Annual Report 2014-2015

Transcription

FUTEBOL CLUBE DO PORTO – Futebol, SAD
Listed Company
Share capital: 112.500.000 euros
Individual own capital in accordance to the last balance approved and referring to June 30, 2014: €-28.512.038; individual own capital in
accordance to balance of December 31, 2014: €306.812 (of limited revision and not subjected to audit)
Head Office – Estádio do Dragão, Via FC Porto, Entrada Poente Piso 3
Registration at 1st Registration of Commercial Registry of Porto and
Legal Person n.º 504 076 574
Management Report and Consolidated Accounts 2014/2015
A. Management Report
1. Message from the Chairman
2. Governing Bodies
3. Highlights
4. Activity Evolution
5. Other Facts that Occurred During the Financial Year
6. Relevant Facts Occurred after the End of the Financial Year
7. Future perspectives
8. Information on own shares
9. Statement of the Board of Directors
B. Consolidated Financial Statements and Appendix
1. Statements of Consolidated Financial Position
2. Consolidated Statements of Results by Category
3. Consolidated Statements of Comprehensive Income
4. Consolidated Statements of Changes in Equity Capital
5. Consolidated Statements of Cash flow
6. Notes to Consolidated Financial Statements
7. Legal Certification of Accounts and Audit Report
8. Report and Opinion of the Audit Committee
C. Corporate Governance Report
D. Shares held by members of the Board of Directors and Audit Committee
Consolidated Accounting Report
2014/2015
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A. Management Report
1. Message from the Chairman
This financial year is clearly set by the increase of capital that allowed FC Porto to reacquire most of
the shares of the company, shielding it from potential capital acquisitions, as can be seen throughout
football in Europe. At the same time, we gave the company the tools needed to uphold the tight
financial criteria for fair play set by UEFA, which gives us tranquillity regarding the future.
Our challenge is to maintain the capacity of our professional team to keep fighting on the pitch with
the best in Europe, knowing that it is an uneven fight, given the income of the clubs in the richest
countries. FC Porto reached the quarter-finals of the UEFA Champions League, which means we were
in the group of eight best teams in Europe. That alone is an impressive achievement, considering that
the teams that were demoted from the English Premiership receive more from television rights than
the entire budget of this company.
Still, Futebol Clube do Porto has been able to match the best in Europe, always aiming at exceeding
itself.
Jorge Nuno Pinto da Costa
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Futebol Clube do Porto – Futebol, SAD
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2. Governing Bodies
General Meeting
Chairman:
Secretary
– José Manuel de Matos Fernandes
– Rui Miguel de Sousa Simões Fernandes Marrana
Board of Directors
Chairman:
Directors:
– Jorge Nuno de Lima Pinto da Costa
– Adelino Sá e Melo Caldeira
– Fernando Manuel Santos Gomes
– Reinaldo da Costa Teles Pinheiro
– Rui Ferreira Vieira de Sá (non-executive)
Audit Committee
Chairman:
Members:
Reserve Member:
– José Paulo Sá Fernandes Nunes de Almeida
– Armando Luís Vieira de Magalhães
– Filipe Carlos Ferreira Avides Moreira
– José Augusto dos Santos Saraiva
Audit Firm
Deloitte & Associados, SROC SA, represented by António Manuel Martins Amaral
Company Secretary
Secretary:
Substitute:
– Daniel Lorenz Rodrigues Pereira
– Raul Filipe Pais da Costa Figueiredo
Advisory Board
Chairman:
Members:
– Alípio Dias
– Álvaro Jose Pereira Pinto Júnior
– Álvaro Rola
– António Fernando Maia Moreira de Sá
– António Manuel Gonçalves
– Artur Santos Silva
– Fernando Alberto Pires Póvoas
– Fernando José Guimarães Freire de Sousa
– Fernando Manuel dos Santos Gomes
– Ilídio Costa Leite Pinho
– Ilídio Pinto
– Jaime Eduardo Lamego Lopes
– João Espregueira Mendes
– Jorge Nuno de Lima Pinto da Costa
– Joaquim Manuel Machado Faria e Almeida
– José Alexandre de Oliveira
– José Paulo Sá Fernandes Nunes de Almeida
– Jorge Alberto Carvalho Martins
– Luís Portela
Remuneration Committee
Chairman:
Members:
– Alípio Dias
– Fernando José Guimarães Freire de Sousa
– Joaquim Manuel Machado Faria e Almeida
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3. Highlights
•
Integration of EuroAntas, a company whose main activity is the management of Estádio do
Dragão, part of the group FC Porto – Futebol, SAD. The impact of this integration is reduced in
terms of results, but clearly significant in terms of patrimony for the Group.
•
The consolidated own capital reaches 83,104m€ in June 30 2015, with the integration of
EuroAntas, whose patrimony structure is firmly consolidated, and with the increase of social
capital in 37,500m€, with the issue of preferential shares without the right to vote. Following
this increase of capital, which was fully subscribed by Futebol Clube do Porto, the social capital
of FC Porto – Futebol, SAD now reaches a total of 112,500m€. In addition, with the acquisition
of the shares belonging to Somague and the take-over made, FC Porto now holds about 75%
of the capital of FC Porto – Futebol, SAD.
•
Net assets increase by 80%, reaching 359,235m€, for the incorporation of Estádio do Dragão,
property of EuroAntas, with a net value of 138,800m€, as of June 30 2015.
•
The total liabilities reach 276,131m€, which represents a growth of 42,668m€ in comparison
to June 30 2014, explained, partly, by the inclusion of the liabilities of EuroAntas, a company
that took over the project finance for the construction of the stadium.
•
Consolidated Net Result reaches 19,958m€, with 19,352m€ attributable to the capital holders
of the home company, far superior to the one obtained in the previous year, especially because
of the growth in results with transactions of passes of players, reaching 82,500m€.
•
Operational gains, excluding gains with passes, increase by 20,976m€, corresponding to 29%,
now reaching 93,589m€, basically due to the increase in revenues obtained for participating
in European competitions.
•
Operational costs, excluding the costs with passes of players, increase by 16%, 15,159m€,
following the increase of costs with staff. However, it should be pointed out that, during this
period, there were prizes paid for the good sporting performance of the team in European
competitions.
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•
Operational results are positive in 34,381m€ in 2014/2015, representing a significant increase
in comparison to the negative 25,789m€ achieved in the previous year.
•
Positive contribution of the companies part of the group in obtaining the result now achieved;
•
The results presented do not take into account the transfer of the athlete Alex Sandro, to
Juventus, for 26,000m€, as it was done after the end of the period.
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4. Activity Evolution
FC Porto – Futebol, SAD fulfils its obligations to present economic and financial information, regarding
the financial year of 2014/2015, from July 1 2014 to June 30 2015.
This document has been executed in compliance with the current legal framework, namely the
provisions of the Companies Code, the Securities Code and the regulations of the Portuguese Securities
Market Commission (Comissão do Mercado de Valores Mobiliários – CMVM).
As required by the regulations of the European Parliament, companies with shares traded in regulated
markets seated in the European Union must use, in their consolidated financial statements, the
international accountancy standards (IAS/IFRS) adopted by the Union for all the financial years starting
on or after the 1st of January 2005.
Regarding FC Porto – Futebol, SAD, these regulations started on the fiscal year of 2005/2006. The
accounts presented for each quarter, and this annual report, were drawn up in accordance with the
international accountancy standards.
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SUMMARY OF SPORTING ACTIVITY
The 2014-15 season was bittersweet in terms of sporting results. On one hand, the team had a good
performance in the UEFA Champions League, reaching the quarter-finals, having started the
competition in the play-offs, where they beat Lille, then winning the group stage, and finally
eliminating Basel. In 12 matches in the most difficult clubs competition, FC Porto lost only once, to
Bayern Munich, and ended up eliminated, which doesn’t erase an extremely positive path.
Less fortunate was the path of the team in the national championship, ended in the second place,
below the objective. Despite achieving a high number of points, enough to become champion in
comparison to the last seasons, the team ended up not being fortunate with the contingencies of the
game, namely the refereeing in some matches, those of the club and those of the opponents.
2014-15 was a season of transition for FC Porto, as the club hired a new coach, Julen Lopetegui, and a
number of new players, almost all of very young age: Andrés Fernández, Ricardo Nunes, Marcano, Indi,
José Ángel, Opare, Casemiro, Campaña, Óliver Torres, Evandro, Otávio, Brahimi, Tello, Adrían López,
Aboubakar, and the promotion to the first squad of Rúben Neves, who debuted in the main team aged
only 17.
By the end of the season, FC Porto, as is normal in this field of activity, made some changes to the
squad. Andrés Fernández, Ricardo Nunes, Opare, Casemiro, Campaña, Óliver Torres, Otávio, Brahimi,
Adrían López, Danilo, Jackson Martínez and Quaresma left the club, and reinforcements Iker Casillas,
Maxi Pereira, Layún, Cissokho, Danilo Pereira, Imbula, André André, Sérgio Oliveira, Corona, Osvaldo,
Varela and Bueno arrived.
With six matchdays played so far for the Portuguese League, FC Porto is in the lead, with 17 points,
from five victories and two ties. In the Champions League, with two matchdays played, FC Porto tied
in Kiev and beat Chelsea, and is in good position to qualify to the round of 16. In nine matches played
this season, FC Porto remains undefeated.
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ECONOMIC ACTIVITY
Futebol Clube do Porto – Futebol, SAD, after a less fortunate season, presents, in the financial year of
2014/15, a consolidated net result of 19,958m€, with 19,352m€ attributable to the holders of own
capital of the parent company.
Even if, this year, the team of FC Porto didn’t reach the objectives concerning the national
championship, in European competitions the team came up as one of the eight best in Europe, reaching
the quarter-final of the UEFA Champions League, which, apart from sporting glory, assured significant
gains for the Company.
The economic and financial situation, analysed in this period, will refer to the consolidated result,
meaning, the one obtained through the individual participation of the companies of the group included
in the consolidation parameter, obtained in the transactions done between them. However, the
individual result of FC Porto – Futebol, SAD is what contributed decisively for the consolidated result.
The year being analysed counts on, for the first time, the participation of the activity developed by
EuroAntas, Promoção e Gestão de Empreendimentos Imobiliários, S.A.. On October 22, FC Porto –
Futebol, SAD acquired a participation of 47% of social capital of EuroAntas from Futebol Clube do
Porto. This company, started on March 22, 2000, has the social objective of “promoting and managing
real estate”, and the main activity is the management of Estádio do Dragão and keeping the project
finance for its construction.
The Board of Directors, with the mission of controlling the financial and operational policies of
EuroAntas (as the members of that Board of Directors are the same as the one belonging to the
sporting company), decided that the company should integrate the consolidation parameter, following
the acquisition of 47% of social capital, which occurred after October 22, 2014.
The effect of the integration of this Company is not deeply impacted in the net result of the financial
year, as most of its activity is made by the billing and registration of costs already considered in other
companies of the Group. Thus, with the consolidation, certain movements are eliminated, which will
leave to changes in the values described in each segment, not deriving from changes in the activity. As
for patrimony, the balance of the company is significantly changed, especially in the assets, with the
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incorporation of Estádio do Dragão, but also in the liabilities, with the integration of the bank funding
associated to the project finance for the construction of the stadium.
Also in terms of patrimony, on October 31, 2014, FC Porto – Futebol, SAD proceeded to a increase in
social capital worth 37,500m€, with the issuing of preferential shares, without the right to vote.
Following that increase in capital, which was subscribed by Futebol Clube do Porto, the social capital
of the Company now reaches the total value of 112,500m€. In addition, FC Porto acquired from
Somague 2,818,185 shares, representative of the social capital of the Group, now detaining most of
the capital, which lead to a take-over, for the price per share of 0.65€, resulting in the acquisition of
464,746 shares. Thus, as a result from these operations, Futebol Clube do Porto now holds 16,782,931
shares 17,055,881, including the shares held by members of the Board of the shareholder),
representing 74.59% (75.80% including the shares held by members of the Board of shareholder) of
own capital. As for the rights to vote of the Group, FC Porto holds 61.89% directly, and 63.71% including
the shares owned by members of its Board.
Considering the facts presented, the comparison between both periods should be done carefully,
especially considering the situation with the patrimony of the Group.
Further ahead in this report, there is a summary of the individual results of each company in the
consolidation perimeter, and for now the focus will remain in the analysis of the last two years of
consolidated results.
As can be seen in the graphic below, in the period being analysed Futebol Clube do Porto – Futebol,
SAD achieved a net result of 19,352m€, contrasting with the negative 40,701m€ achieved in the
previous year.
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The net result of FC Porto – Futebol, SAD, like other companies in the same field of activity, comes
from three components:
• Operational results excluding the trade of players;
• Results related to the trade of players;
• Financial and obtained from investments results (plus taxes over income)
All these components had a positive behaviour in comparison to the previous year. The first
component, operational results excluding the trade of players, is the most stable throughout the years,
as it holds the recurring gains and costs year after year, which mostly come from contracts set on the
long term. This includes the gains obtained from participating in European competitions, a relevant
and recurring item in the financial statements of the Group. The second, related to trade of players, is
the most volatile, as it reflects the decisions of the Board, each year, in reinforcing, maintaining or
release players from the squad. The differences registered here are what mainly determines the
positive/negative results of the Group. Finally, the financial results reflect the needs of money and
access to credits of the Company. In this financial year, the results with trade of passes of players
definitely determined the end result.
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Looking at the operational gains, excluding gains with trade of players, there was an increase of
20,976m€, representing 29% in comparison to the previous year. This growth is mainly explained by
the revenues obtained from participating in European competitions.
values in thousand euros
Operational Gains, excluding the trade of passes
2014/2015
%
2013/2014
%
Merchandising
3.828
4%
3.720
5%
Tickets
7.878
8%
6.228
9%
UEFA Competitions
36.170
39%
9.552
13%
Other Sporting Revenues
1.177
1%
2.400
3%
TV rights
17.251
18%
15.928
22%
Publicity and Sponsorship
13.565
14%
13.594
19%
Corporate Hospitality
8.201
9%
14.353
20%
Other Services
4.269
5%
4.923
7%
Other Gains
1.250
31
1.915
3%
TOTAL
93.589
100%
72.613
100%
As can be seen in the chart above, the items that are part of the operational gains, excluding gains with
passes, had different behaviours when compared to the previous year.
Merchandising had a 3% growth in comparison to 2013/2014. Billing had a bigger increase, however,
as part of these sales go to the company EuroAntas, which is now part of the Group, these sales void
themselves in this year.
The ticket gains, which globally mean the sale of Dragon Seats (yearly passes), tickets sold per match
and the fees paid by the FC Porto associates, which are part of the gains of the sporting group, had a
26% increase in 2014/2015, to 7,878m€. This increase comes from the sale of tickets per match, in
both the national championship and European competitions, for the match for the quarter-finals of
the UEFA Champions League, played at Estádio do Dragão.
The biggest highlight of the chart goes for the increase in the gains obtained from the participation of
FC Porto in UEFA competitions, caused by two factors: the accounting of the prize for reaching the
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competition in this year, and for the sporting performance in the competition. Considering the
accounting policy systematically adopted, in which the prize obtained for accessing the UEFA
Champions League is accounted in the year the access is guaranteed, the 8,600m€ that the Group
gained for participating in the 2014/2015 edition of the competition, after the qualification from the
play-off, in August, were only accounted in this financial year, unlike what usually happens. On the
other hand, the performance of the team this season (4 victories and two ties, qualification to the
round of 16, and then to the quarter-finals, where they lost to Bayern Munich) was far better than the
one in the previous season (1 victory and two ties and the qualification to the UEFA Europa League).
In addition, as the place reached by FC Porto in the national championship allowed for the direct
qualification to the 2015/2016 edition of the UEFA Champions League, that access prize was also
accounted here, a prize that reaches 12,000m€ for the period of 2015 to 2018.
In Other Sporting revenues, the gains for participating in the Portuguese Cup are accounted, as well as
the pre-season tournaments and the gains coming from Dragon Force. The management of the Dragon
Force schools has been growing throughout the years and this one was no exception. However, as
there were no significant revenues coming from the participation in pre-season tournaments (in
2013/14, FC Porto participated in tournaments in Latin America and in the tournament of London),
and as the team was eliminated early from the Portuguese Cup, this item suffered a loss of 1,224m€.
TV rights grew by 1,323m€ in comparison to the previous year. Part of this growth is due to the
progressive income covered by the contract between FC Porto - Futebol, SAD and PPTV - Publicidade
de Portugal e Televisão S.A. for the transfer of broadcasting rights of the domestic league, when playing
at home. However, there was also an increase in income from the distribution rights of Porto Canal,
exploited by PortoMedia, which integrated the Group during the year 2013/2014.
Gains from advertising and sponsorship remained almost unchanged from the previous period. This
item consists mostly, by advertising revenue made on the official equipment of FC Porto, by the main
sponsors, which in the year under review are Portugal Telecom, Unicer and Warrior (new technical
sponsor). PortoComercial is also responsible for attracting advertising, with the sale of available
advertising media. Finally, PortoMedia, collaborates in this item with advertising made in Porto Canal.
The item “Corporate Hospitality” covers the revenue from the management and operation of this
segment, which are gains of the companies analysed here, purged of consolidation adjustments. This
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business, which, summarily, is the transfer of a set of products and services for businesses, which
include the rights to use of cabins and seats for companies at Estádio do Dragão to watch FC Porto
games, are charged by PortoComercial and then directed to EuroAntas, using this liquidity to meet the
debt for the construction of the stadium. During the reporting period, the value of this item declined,
not because the sale revenue of this concept fell, but because the merger of EuroAntas in the Group
led to that billing to this company is disregarded in the period in question, from October 22.
The remaining operating income, not yet mentioned, registered in “Other Services” and “other gains”
and that are based mainly on operating income of subsidiaries, except for income, cited above, from
Merchandising, TV Rights and Advertising and Sponsorship from PortoComercial and PortoMedia, fell
1,319m€. It is also included here, in 2013/2014, the amount allocated by FIFA as compensation for the
use of the FC Porto players in the World Cup in Brazil, of 556m€, which explains part of the decrease.
As a result of the facts presented, the operational gains excluding gains from trade of players reached
93,589m€, an increase of 20,976m€ in comparison to the previous year, as can be seen in the graphic
below.
Concerning operational costs, still excluding trade of players, there was an increase of 16% in
comparison to 2013/14.
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Operational Costs excluding costs with passes
2014/2015
%
2013/2014
%
CMV
2.655
2%
2.607
3%
External Supplies and Services
33.237
30%
42.048
44%
Costs with Staff
69.999
63%
48.885
51%
Amortizations excluding depreciation of passes
2.775
3%
559
1%
632
1%
-86
0%
1.037
1%
1.162
1%
110.334
100%
95.175
100%
Provisions and impairment losses excluding passes
Other costs
TOTAL
Accompanying the increase in merchandising sales, so did the cost of goods sold, albeit to a lesser
extent, leading to improved outcome of this business.
Concerning supplies and external services, there was a decrease of 8,811m€ divided by several types
of spending that compose them.
The increase in personnel costs was due, primarily, to the strong investment made in the squad, which
led to a significant increase in salaries. However, the period also includes the prizes paid to athletes,
associated with the excellent sporting performance in European competitions.
The increase in amortization excluding depreciation of passes is due to the integration of EuroAntas,
since this company holds Estádio do Dragão, which is being amortized over a period of 50 years.
Provisions and impairment losses, excluding passes, reach 632m€ for the registration of new provisions
and impairment losses considered adequate.
The “other costs”, which represent less significant costs not listed, and that represent only 1% of the
total, decreased by 11% over the same period.
In summary, operating costs excluding costs with trade of players reach 110,334m€, an increase of
15,159m€, as shown in the chart below:
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The net value of the sum of operating gains and costs excluding trade of player passes, reached a
negative overall value of 16,745m€, which is still an improvement of 5,817m€ over the same period.
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We now turn to the second component of net income, the results related to trade of players
(amortization and impairment losses with passes and Result of Transaction of passes) that, in FC Porto
- Futebol, SAD, has an indisputable and decisive weight for the result of the company.
Contributing negatively to the result of Group, amortization and impairment losses with trade of
players recorded a value of 31,374m€, which represents an increase of 4,243m€ in comparison to the
previous period. The increase in depreciation resulting from contracts agreed with the players and the
investments made in the acquisition of sporting rights, reflects the investment in the team, while the
increase in impairment losses relates to increased economic costs with estimated losses in the
realization value the passes of some players.
The result of Passes Transactions, which includes the costs and revenues from the sale and loan of
sports rights of players, has traditionally been a positive item in the financial statements of the group.
The results obtained come primarily from net capital gains (the value of the sale must be subtracted
of the costs to each business and the net book value of its sports rights) resulting from sales of sporting
and economic rights of players to other clubs / entities, that have represented a substantial part of the
income of FC Porto - Futebol, SAD and of many other companies in this line of activity, thus balancing
its operating results. Net capital gains from the sale of sports rights of players have been growing
gradually over seasons, and in the period under review, reached the highest level ever of Portuguese
SADs – 82,500m€, corresponding to gross 119,488m€. The focus on giving the team good values, not
only contributes to the sporting success, it also enables the achievement of important revenue for this
company. During this period, the capital gains from the sale of sports rights, at the start of the season,
of players Eliaquim Mangala and Steven Defour, to Manchester City and Anderlecht, respectively, by
30,504m€ and 6,000m€, are recorded, and so are the ones for Danilo and Jackson Martinez to Real
Madrid for 31,500m€ and Atletico de Madrid for 35,000m€, respectively, which came closer to the end
of this exercise. This period also includes 7,500m€ paid by Real Madrid to cancel the execution of the
option for definitive purchase of sports rights of Casemiro, attributed to FC Porto in the agreement of
loan of the player. In the previous period, the gains resulting from the transfer of Otamendi, Iturbe and
Fernando to Valencia, Hellas Verona and Manchester City for 12,000m€, 15,000m€, and 15,000m€,
respectively, are registered.
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It’s exactly the variation of this item that justifies the growth in operational results (results before the
costs and gains, results relative to investments and taxes over income), which reach 34,381m€, far
above the negative 25,786m€ registered in the previous year.
It is now added to this analysis the third component, the financial results and relating to investments,
adding to it the taxes over income for the year.
In this exercise, the worsening of the financial results in 4,749m€ in comparison to the previous period,
was largely due to the integration of EuroAntas in the group, as this company, as owner of Estádio do
Dragão, is responsible for the compliance of the financing project for its construction, which has to be
fulfilled scrupulously. On the other hand, there is also a decrease in financial income, since the club
stopped, in October 2014, paying interests on the debt with the sports society, as it was liquidated on
that date.
The investment income, where the results obtained with investment in economic rights of players in
which the Company does not own the sports rights are accounted, have improved significantly in the
period under review, as it was accounted the percentage owed to FC Porto - Futebol, SAD for the
transfer of player Souza from São Paulo to Fenerbahçe, as the Company still held 25% of sports rights
of the athlete.
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Finally, the last item that completes the results of the Group, the tax over income for the year, reaches
601m€. This tax in the same period showed a significantly higher value, since FC Porto - Futebol, SAD
agreed to special arrangements for settlement of tax liabilities, which came to impair the Group's
results in 2,714m€ in 2013/2014.
As epilogue for the analysis made, the Group reported a consolidated net profit of 19,958m€, with
19,352m€ attributable to equity holders of the parent company. This result stands out from the
negative 40,708m€ presented in 2013/2014.
This positive evolution of net income becomes more significant if we focus on EBITDA (operating cash
flow), which reflects the resources freed by the operating activity of the company and is obtained by
operating income, net of amortization, impairment losses and provisions. The growth in EBITDA, which
reached this year 69,162m€, allows the Group greater self-financing capacity.
Now looking at the financial position of the Group on June 30 2015 there are two facts that stand out:
the increase in own capital of FC Porto - Futebol, SAD and the increase in tangible assets.
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The total of own capital of FC Porto - Futebol, SAD is, on June 30, 2015, of 83,104m€, which represents
a strong strengthening of the equity structure of the group on a consolidated basis.
There were two factors contributing for this growth. On one hand, the incorporation of positive net
results obtained in the period under review led to a recovery of the equity of FC Porto - Futebol, SAD
of 19,352m€. On the other hand, the Company had its share capital increase by 37,500m€, with the
issuing of 7,500,000 preferential shares without voting rights, fully subscribed by its shareholder FC
Porto. Thus, the share capital of FC Porto - Futebol, SAD now amounts to 112,500m€. However, given
the incorporation of EuroAntas in the group, whose social capital is not held by FC Porto - Futebol, SAD
in 53%, the exclusion of minority interests means that the equity attributable to shareholders of the
Parent Company is substantially lower (24,340m€).
With regard to the assets, which reached 359,235m€ on June 30, 2015, there is a very significant
growth in terms of tangible assets, by incorporation of Estádio do Dragão, owned by EuroAntas, whose
net value amounts to 138,200m€. There was also an increase of the amount receivable, which includes
the amount receivable from Atletico Madrid on activating the release fee for player Jackson Martinez.
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Regarding liabilities, amounting to 276,131m€ on June 30, 2015, there was an increase of 42,668m€,
based on the amounts payable to suppliers and financial debt. This growth was largely due to the
aggregate liabilities of EuroAntas, the company which took over the project finance for the
construction of Estádio do Dragão.
___________________________________________________________________________________________
20
2014/2015
___________________________________________________________________________________________
However, with regards to the structure of liabilities, the company managed to ease the financial
pressure, since current liabilities decreased by 26,866m€, now representing 55% of its total, whereas
on June 30, 2014, represented 77%.
Part of this restructuring went through the issuing of a new bond loan. According to the final results of
the operation, calculated by Euronext Lisbon in Special Stock Exchange Session, held on May 22, 2015,
4,778 subscription orders were collected that, in its sum, corresponded to an amount of approximately
110,000m€. The marketing operation proved to be a success. The total amount of the subscription,
after extending the amount of 40,000m€ to 45,000€, was fully subscribed on the 1st day of the offer,
which reached 69,477m€. At this time the company has two bond loans, one for 20,000m€, with
reimbursement on June 6 2017 and another for 45,000m€, the full payment will be made on May 28,
2018.
___________________________________________________________________________________________
21
2014/2015
___________________________________________________________________________________________
INDIVIDUAL PERFORMANCE OF THE COMPANIES IN THE CONSOLIDATION PERIMETER
The numbers shown so far present the consolidated economic and financial situation of FC Porto –
Futebol, SAD, which means that the accounting of all the eight companies (seven in 2013/2014) in the
consolidation perimeter are taken into account.
Below is the individual performance of each of them, before the consolidation adjustments:
FC Porto
Porto
Porto
Porto
Porto
Dragon
Porto
Futebol, SAD
Comercial
Estádio
Multimédia
Seguro
Tour
Media
EuroAntas
Companies in the group
Operational Gains excluding Trade of Players
72.809
23.210
3.495
29
1.057
3.477
4.864
9.814
Operational Costs excluding Trade of Players
(93.722)
(21.276)
(3.263)
(86)
(565)
(3.342)
(4.626)
(7.972)
Operational Results excluding Trade of Players
(20.913)
1.935
232
(57)
492
136
238
1.842
Amortizations and Impairment losses with Trades
(31.374)
-
-
-
-
-
-
(Costs)/Gains with Trades
82.500
-
-
-
-
-
-
Operational Results
30.213
1.935
232
(57)
492
136
238
1.842
(13.479)
(396)
(1)
-
0
(0)
-
(812)
1.096
-
-
-
-
-
-
-
97
(337)
(98)
1
(133)
(40)
(47)
(87)
17.928
1.202
134
(56)
360
96
191
944
Financial Results
Results related to Investments
Taxes over Income
Net Result of the year
The table above shows that the result achieved by FC Porto - Futebol, SAD on a consolidated basis was
obtained almost exclusively by the individual result of the Group. However, the aggregate of the
remaining companies included in the consolidation perimeter contributed positively to the result of
the Company on a consolidated basis.
All companies, except for PortoMultimédia showed positive net income, thus following the good
performance of the parent company.
___________________________________________________________________________________________
22
2014/2015
___________________________________________________________________________________________
5. Other Facts Occurred During the Exercise
•
On October 31 2014 there was a capital increase by issuing preferential shares, without voting
rights, amounting to 37,500m€. Following this capital increase, which was fully subscribed by
Futebol Clube do Porto, the capital of the Group amounts to a total of 112,500m€ on December
31, 2014.
•
Following the acquisition of the shares of FC Porto - Futebol, SAD that were held by Somague
(2,818,185 shares representing the social capital of the Group and with voting rights) by Futebol
Clube do Porto, this has become majority holder of the share capital of the Group (58.79%) and
therefore was obliged to launch a takeover bid. The value offered by the shareholder was 0.65€,
which was subject to an assessment by a firm of independent auditors, appointed by the CMVM
due to the reduced liquidity of the securities, to ensure that the amount offered did not harm small
shareholders. In this operation 464,746 shares were acquired, representing 3.10% of the share
capital, excluding preferential shares. Thus, as a result of these transactions, Futebol Clube do
Porto became holder of 16,782,931 shares (17,055,881 including the shares held by members of
the shareholder Board of Directors), representing 74.59% (75.80% including shares held by
members of the shareholder Board of Directors) of the social capital. With regard to voting rights
in the Group, FC Porto holds 61.89% directly and 63.71% including the shares held by members of
its Board of Directors.
•
Also in this period, the Group acquired, from Futebol Clube do Porto, 47% of EuroAntas, Promoção
e Gestão de Empreendimentos Imobiliários, S.A., a company whose main asset is Estádio do
Dragão, with an evaluation report of the group being done, to ensure the fair value of transaction,
by independent auditor, which set the value at 110,121m€.
•
As part of the bond issue by the Group, there was a payment of interest for coupon n. 4, on
November 21, 2014, and payment of interest for coupon n. 5 and reimbursement of the obligation
“FC PORTO SAD MAY 2015”, on May 21, 2015, as defined under the terms of the respective loan
and included in the public offering prospectus.
•
As part of the bond issue by the Group, there was a payment of interest for coupon n. 1 and n. 2
of the obligations "FC PORTO SAD 2014-2017", on November 9, 2014 and June 8, 2015,
respectively. The repayment of the transaction will take place on June 6, 2017, as defined in the
public offering brochure.
___________________________________________________________________________________________
23
2014/2015
___________________________________________________________________________________________
6. Relevant Facts that Occurred after the Term of the Period
•
On July 1, 2015 FC Porto - Futebol, SAD reached an agreement with Olympique de Marseille for
the acquisition of the sporting registration rights and all economic rights of professional football
player Imbula for the amount of 20,000m€. The player signed a contract for 5 sporting seasons
with a release fee of 50,000m€.
•
FC Porto - Futebol, SAD reached an agreement with Juventus Football Club, on August 20, 2015,
for the sale of sporting registration rights of professional footballer Alex Sandro for the amount of
26,000m€.
•
On August 31, 2015, the Company gave the sporting registration rights of player Juan Quintero to
Stade Rennais Football Club (“Rennes”) until June 30, 2016, with the Rennes having buy fee option
of such rights for a total value of 20,000m€.
•
On that same day, FC Porto, Futebol, SAD reached an agreement with FC Twente for the acquisition
of the sporting and economic rights of athlete Jesus Corona in the amount of 10,500m€. Twente
is also guaranteed, if the player is transferred to a third club during the term of his contract with
FC Porto, the right to an amount corresponding to 30% of the transfer fee. The player signed a
contract for 5 sporting seasons with a release fee of 50,000m€.
•
The Group announced to the market on September 24, 2015, that athlete Yacine Brahimi was
offered a new contract, changing the release fee of 50,000m€ to 60,000m€.
___________________________________________________________________________________________
24
2014/2015
___________________________________________________________________________________________
7. Future Perspectives
The time of our Group is marked by one of the best economic performance since its establishment.
The approximately 20 million euros profit attest to the reliability of the management model of this
administration. However, the sporting season was far below expectations. Despite the good European
campaign, FC Porto failed the most desired celebration, the title of national champion. The demand to
which we commit daily does not allow us to an effusive balance. What is extraordinary for many, is
recurring for us. Winning is our most remarkable facet. Since 1893.
So, the 2015/2016 season is a new challenge.
Alongside the continuity of the head coach, Spanish Julen Lopetegui, the sporting strategy has become
hiring some well-established athletes and other still young, with unquestionable quality and
remarkable margin for progression, which will be subject to strong appreciation in the short term. FC
Porto decided to strengthen the first team with the likes of Iker Casillas, Maxi Pereira, Layún, Cissokho,
Danilo Pereira, Imbula, André André, Sérgio Oliveira, Corona, Osvaldo, Varela and Bueno.
These assets and the head coach's ambition will be determinant for a continued and long lasting
evolution of the squad, and to get as far as possible in all competitions.
We won’t always win, but we will always win again.
___________________________________________________________________________________________
25
2014/2015
___________________________________________________________________________________________
8. Information on own shares
FC Porto – Futebol, SAD holds 100 own shares, consolidated, worth 499€. These shares, although a
small representation of the social capital of the company, belong to PortoSeguro, a company of the
group held at 90% by FC Porto – Futebol, SAD.
PortoSeguro has acquired 100 shares at the moment the SAD was formed, in 1997, and never alienated
or acquired any more shares. Thus, in the beginning and the end of the financial year, FC Porto –
Futebol, SAD had 100 shares, worth 500€.
9. Statement of the Board of Directors
Under the terms of paragraph c) of point 1 of article 245 of the Securities Code, the directors of FC
Porto – Futebol, SAD, in charge of the company, state that, to their knowledge, the information
presented in this report, the annual accounts and other accounting documents required by law or
legislation, even if not approved by General Meeting, has been gathered in conformity with
international financial reporting standards adopted in the European Union, giving a true and accurate
image of assets and liabilities, of the financial situation and results of the issuer and of the companies
included in the Group, and that the management report faithfully lays out the evolution in business,
performance and position of the issuer and of the companies included in the Group, and contains a
description of the main risks and uncertainties the company has to face.
___________________________________________________________________________________________
26
2014/2015
___________________________________________________________________________________________
Porto, October 8 2015
Board of Directors,
________________________________
Jorge Nuno Lima Pinto da Costa
________________________________
Adelino Sá e Melo Caldeira
________________________________
Fernando Manuel Santos Gomes
________________________________
Reinaldo da Costa Teles Pinheiro
________________________________
Rui Ferreira Vieira de Sá
___________________________________________________________________________________________
27
2014/2015
___________________________________________________________________________________________
B. Consolidated Financial Statements and Appendix
1. Statements of Consolidated Financial Position
ASSETS
NON-CURRENT ASSETS
Tangible assets
Intangible assets - Players' registrations
Other intangible assets
Other financial assets
Goodwill
Trade receivables
Other non-current assets
Total non current assets
CURRENT ASSETS
Inventories
Trade receivables
Other current assets
Other financial assets
Cash and cash equivalents
Total current assets
Notes
30.06.2015
30.06.2014
7
8
7
9
4 and 10
11
13
139.965.096
65.909.714
1.715.184
292.167
3.139.715
13.545.184
8.091.867
232.658.927
1.197.406
61.505.641
1.764.128
720.999
3.139.715
11.243.921
24.691.949
104.263.759
12
11
13
14
14
2.180.310
74.757.925
24.571.205
6.826.271
18.240.722
126.576.433
1.596.982
64.498.529
15.071.223
14.965.439
96.132.173
359.235.360
200.395.932
112.500.000
(499)
259.675
169.075
652.307
(108.260.976)
(331.262)
19.351.824
24.340.144
75.000.000
(499)
259.675
169.075
652.307
(68.266.976)
(40.701.114)
(32.887.532)
TOTAL ASSETS
EQUITY AND LIABILITIES
EQUITY
Share capital
Own shares
Share issue premiums
Legal reserve
Other reserves
Retained earnings
Other changes in equity
Consolidated net result for the year
Equity attributable to equity holders of the parent company
16
Non-controlling interests
17
58.763.775
(179.808)
83.103.919
(33.067.340)
18
18
33
20
21
23
15
22
36.288.117
63.711.415
526.226
5.635.495
15.963.736
335.224
2.210.218
124.670.431
19.112.500
19.395.933
1.006.255
12.762.622
448.818
410.555
53.136.683
18
18
19
20
21
61.454.581
11.089.200
46.132.804
32.784.425
151.461.010
71.040.781
29.591.657
10.027.940
35.846.536
33.819.675
180.326.589
276.131.441
233.463.272
359.235.360
200.395.932
TOTAL EQUITY
LIABILITIES
NON-CURRENT LIABILITIES
Bank loans
Bonds
Derivatives
Trade payables
Other non current liabilities
Pension liabilities
Deferred tax liabilities
Provisions
Total non current liabilities
Bank loans
Bonds
Other creditors
Trade payables
Other current liabilities
Total current liabilities
Total liabilities
TOTAL EQUITY AND LIABILITIES
___________________________________________________________________________________________
28
2014/2015
___________________________________________________________________________________________
2. Consolidated Statements of Results by Category
Notes
Sales
Services rendered
Other income
Cost of goods sold
External supplies and services
Payroll expenses
Amortisation and depreciation excluding amortisation of players' registrations
Provisions and impairment losses excluding players' registrations
Other expenses
Operational profit/(loss) excluding results with players' registrations
Amortisation and impairment losses of players' registrations
Income/(expenses) related with transactions of players' registrations
30.06.2015
30.06.2014
3.828.129
88.510.534
1.250.341
(2.654.892)
(33.236.607)
(69.998.566)
(2.774.532)
(632.435)
(1.037.215)
(16.745.243)
3.720.078
66.978.193
1.914.559
(2.606.929)
(42.048.016)
(48.885.294)
(559.339)
86.273
(1.161.977)
(22.562.452)
(31.373.937)
82.500.431
51.126.494
(27.130.704)
23.906.857
(3.223.847)
34.381.251
(25.786.299)
28
28
29
(17.009.385)
2.090.505
1.096.113
20.558.484
(12.734.466)
2.564.942
(1.532.169)
(37.487.992)
15
(600.791)
(3.219.926)
19.957.693
(40.707.918)
24
12
25
26
7
22
27
27
Total operacional profit/(loss)
Financial expenses
Financial income
Gains and losses in investments
Profit/(loss) before income tax
Income tax
Consolidated profit/(loss) for the year
___________________________________________________________________________________________
29
2014/2015
___________________________________________________________________________________________
3. Consolidated Statements of Comprehensive Income
Notes
Net consolidated profit / (loss) for the year
Other comprehensive income for the year
Items that will not be reclassified to net income
Items that future will be reclassified to net income
Change in fair value of cash flow hedge derivatives
Actuarial gains and losses
Total consolidated comprehensive income for the year
Attributable to:
Equity holders of the parent company
33
23
17
30.06.2015
30.06.2014
19.957.693
(40.707.918)
-
-
249.011
138.526
20.345.230
-
(40.707.918)
19.739.361
605.869
(40.701.114)
(6.804)
___________________________________________________________________________________________
30
Balance as at 30 June 2015
6
112.500.000
-
-
37.500.000
-
16
-
75.000.000
Balance as at 1 July 2014
Appropriation of consolidated profit of 2013
Transfer to legal reserve
Transfer to other reserves
Transfer to retained earnings
Dividends distributed
Capital increase amount
Changes in reserves
Changes in perimeter
-
-
75.000.000
-
Acções
Próprias
75.000.000
Share
capital
Appropriation of consolidated profit of 2012:
Transfer to legar reserve
Transfer to other reserves
Transfer to retained earnings
Changes in perimeter
Notes
(499)
-
(499)
(499)
-
(499)
Own
shares
259.675
-
259.675
259.675
-
259.675
169.075
-
169.075
169.075
36.322
-
132.753
652.307
-
652.307
652.307
464.045
-
188.262
(108.260.976)
(40.701.114)
707.114
-
(68.266.976)
(68.266.976)
19.855.633
-
(88.122.609)
-
(331.262)
(11.685)
(707.114)
387.537
Attributable to equity holders of the parent company
Share
issue
Legal
Other
Retained
Other changes
premiums reserve reserves
earnigs
in equity
19.351.824
40.701.114
19.351.824
(40.701.114)
(40.701.114) -
(36.322)
(464.045)
(19.855.633)
3
(40.701.114)
20.355.997
Consolidated net
result for the year
24.340.144
37.500.000
(11.685)
19.739.361
(32.887.532)
(32.887.532)
3
(40.701.114)
7.813.579
Total
58.763.775
(25.716)
(1)
58.363.431
605.869
(179.808)
(179.808)
13.220
(6.804)
(186.224)
Non-controlling
interests
83.103.919
(25.716)
37.500.000
(11.686)
58.363.431
20.345.230
(33.067.340)
(33.067.340)
13.223
(40.707.918)
7.627.355
Total
2014/2015
___________________________________________________________________________________________
4. Consolidated Statements of Changes in Equity Capital
___________________________________________________________________________________________
31
2014/2015
___________________________________________________________________________________________
5. Consolidated Statements of Cash flow
Notes
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
Net cash flow from operating activities (1)
90.429.496
(38.604.559)
(73.965.833)
(1.411.969)
(601.276)
Investment activities:
Cash receipts arising from:
Tangible assets
Players' registrations
Interest and similar income
76.585.758
1.025.838
Cash payments arising from:
Investments
Players' registrations
Tangible assets
Net cash from/(used in) investment activities (2)
(37.500.000)
(45.402.780)
(112.499)
Financing activities:
Cash receipts arising from:
Investments
Loans obtained from investors (Note 19)
Loans obtained
Cash payments arising from:
Loans obtained from investors (Note 19)
Dividends
Loans obtained
Interest and similar charges
Net cash from/(used in) financing activities (3)
Cash and cash equivalents at the beginning of the financial year
Variation of consolidation perimeter
Net increase/(decrease) of cash and cash equivalents: (1)+(2)+(3)
Cash and cash equivalents at the end of the financial year
30.06.2015
37.500.000
5.000.000
77.408.767
(3.000.000)
(25.716)
(70.733.861)
(13.326.972)
14
6
14
(24.154.141)
(24.154.141)
77.611.596
(83.015.279)
(5.403.683)
119.908.767
(87.086.549)
32.822.218
14.965.439
10.889
3.264.394
18.240.722
30.06.2014
65.454.943
(47.834.299)
(50.468.736)
(4.022.410)
(4.566.891)
23.700
71.246.628
620.168
(68.127.923)
(159.085)
1.500.000
95.368.000
(51.017.500)
(10.868.942)
(41.437.393)
(41.437.393)
71.890.496
(68.287.008)
3.603.488
96.868.000
(61.886.442)
34.981.558
17.817.786
(2.852.347)
14.965.439
___________________________________________________________________________________________
32
2014/2015
___________________________________________________________________________________________
6. Notes to Consolidated Financial Statements
1.
INTRODUCTION
Futebol Clube do Porto - Futebol, S.A.D. (‘FCPorto, SAD’ or ‘the Company’), with head office at
Estádio do Dragão, Via F.C. Porto, Entrada Poente, 3rd Floor, 4350-451 Porto, was incorporated
on 30 July 1997, and is the parent company of a group companies as presented in Note 5 as the
FCP Group (‘Group’). Its’ main activity considers the participation in professional football
competitions and the sporting events promotion and organization.
These consolidated financial statements are presented in euro, rounded to units, which is the
currency presented by the Company in its operations and therefore considered its functional
currency.
2.
SIGNIFICANT 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 included in the consolidation,
adjusted in the consolidation process to reflect International Financial Reporting Standards
effective for financial years beginning 1 July 2014, as adopted by the European Union. Such
standards include the International Financial Reporting Standards (‘IFRS’) issued by the
International Accounting Standards Board (‘IASB’), the International Accounting Standards (‘IAS’)
issued by the Accounting Standards Committee (‘IASC’) and the respective interpretations – SIC
and IFRIC issued by the International Financial Reporting Interpretation Committee (‘IFRIC’) and
Standing Interpretation Committee (‘SIC’), that have been adopted by the European Union. These
standards and interpretations are referred to hereinafter collectively as ’IAS/IFRS’.
The interim financial statements were prepared, quarterly, in accordance with IAS 34 – Interim
Financial Report.
During the year ended as of 30 June 2015, no changes occurred in relation to the accounting
policies presented in the consolidated financial statements as of 30 June 2014.
The following standards, interpretations, amendments and revisions adopted (“endorsed”) by the
European Union have become effective during the year ended as of 30 June 2015:
The adoption and application of these standards and interpretations did not produce material
changes in the financial statements of the Group as of 30 June 2015.
The following standards, interpretations, amendments and revisions, with mandatory application
in future years, were, until the approval date of the accompanying financial statements, endorsed
by the European Union:
1 – Standards, interpretations, amendments and revisions which have mandatory application in
the financial year ended as of 30 June 2015:
___________________________________________________________________________________________
33
2014/2015
___________________________________________________________________________________________
The following standards, interpretations, amendments and revisions were endorsed by the
European Union and have mandatory application for the first time in the financial year ended as
of 30 June 2015:
Standard / Interpretation
Effective
date (annual
periods
beginning
on or after)
IFRS 10 - Consolidated Financial
Statements
1-Jan-14
This standard is to establish requirements for
the presentation of consolidated financial
statements by the parent company, replacing,
in these respects, IAS 27 - Consolidated and
Separate Financial Statements and SIC 12 Consolidation - Special Purpose Entities. This
standard also introduces new rules concerning
the definition of control and the
determination of the scope of consolidation.
IFRS 11 - Joint Arrangements
1-Jan-14
This standard replaces IAS 31 - joint Ventures
and SIC 13 - Jointly Controlled Entities - NonMonetary Contributions by Ventures and
eliminates the possibility of using the
proportional consolidation method in
accounting for interests in joint ventures.
IFRS 12 – Disclosure of Interests in
other entities
1-Jan-14
This standard establishes a new set of
disclosures relating to investments in
subsidiaries, joint arrangements, associates
and unconsolidated entities.
IAS 27 – Separate Financial
Statements (2011)
1-Jan-14
This amendment restricts the scope of IAS 27
to the separate financial statements.
IAS 28 – Investments in
Associates and joint ventures
(2011)
1-Jan-14
This amendment aims to ensure consistency
between IAS 28 - Investments in Associates
and new standards adopted, in particular IFRS
11 - Joint Arrangements.
Amendments:
• IFRS 10 - Consolidated
Financial Statements;
• IFRS 12 - Disclosure of
Interests
in
other
entities
(Investment
activities)
1-Jan-14
This amendment introduces an exemption
from consolidation for certain entities that
meet the definition of investment entity. It
also determines rules for measurement of
investments held by these investment entities.
IAS 32 (Amendment) - Offsetting
Financial Assets and Financial
Liabilities
1-Jan-14
This amendment clarifies certain aspects of
the standard due to the diversity of
requirements in applying for compensation.
1-Jan-14
___________________________________________________________________________________________
34
2014/2015
___________________________________________________________________________________________
IAS
36
(Amendment)
–
Impairment
(Recoverable
Amount disclosures for nonfinancial assets)
1-Jan-14
IAS 39 (Amendment) - Financial
Instruments: Recognition and
Measurement
(Novation of Derivatives and
Continuation
of
Hedge
Accounting)
1-Jan-14
IFRIC 21 - Levies
Defined Benefit Plans: Employee
Contributions (Amendments to
IAS 19)
This amendment eliminates the disclosure
requirements of the recoverable amount of a
cash-generating unit like goodwill or
intangible assets with indefinite useful lives
allocated to periods where it was not recorded
any impairment loss or reversal of
impairment. Introduces additional disclosure
requirements for assets for which it was
recorded an impairment loss or reversal of
impairment and the recoverable amount of
these has been determined based on fair value
less costs to sell.
This amendment allows, in certain
circumstances, the continuation of hedge
accounting when a derivative designated as a
hedging instrument is overhauled.
This interpretation establishes the conditions
regarding the timing of recognition of a
liability related with a levy imposed by a
government in result of a determined event
(for example the participation in a certain
market) in cases that payment has, as
counterpart specified goods or services.
1-Jul-14
Amends IAS 19 Employee Benefits to clarify
the requirements that relate to how
contributions from employees or third parties
that are linked to service should be attributed
to periods of service. In addition, it permits a
practical expedient if the amount of the
contributions is independent of the number of
years of service, in that contributions, can, but
are not required, to be recognised as a
reduction in the service cost in the period in
which the related service is rendered.
The effect in the consolidated financial statements of the Group for the year ended as of 31 June
2015, due to the adoption of the standards, interpretations, amendments and revisions
mentioned above has not been significant.
2 – Standards, interpretations, amendments and revisions with mandatory application in future
years
The following standards, interpretations, amendments and revisions, with mandatory application
in future years, were, until the approval date of the accompanying financial statements, endorsed
by the European Union:
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___________________________________________________________________________________________
Standard
Improvements
to
the
International Financial Reporting
Standards (2011-2013)
Effective
date (annual
periods
beginning
on or after)
1-Jan-15
These improvements involve the clarification
of some aspects of IFRS 1 - First-time Adoption
of International Financial Reporting Standards,
IFRS 3 - Business Combinations, IFRS 13 - Fair
Value Measurement and IAS 40 - Investment
Properties.
3 – Standards, interpretations, amendments and revisions not endorsed by the European Union
The following standards, interpretations, amendments and revisions with mandatory application
in future years, have not yet been endorsed by the European Union at the date of approval of
these financial statements:
Standard
IFRS 9 - Financial Instruments
(2009)
and
subsequent
amendments
This amendment in inserted in the IAS 39 revision project and
establishes the requirements for the classification and
measurement of financial assets and liabilities and for the
application of hedge accounting rules.
IFRS 14 – Regulatory Deferral
Accounts
This standard establishes the reporting requirements, by entities
who first adopt IFRS / IAS applicable to regulatory deferral
accounts.
IFRS 15 – Revenue from Contracts
with Costumers
This standard introduces a revenue recognition structure based on
principles and based on a model to be applied to all contracts
entered into with customers.
IFRS 11 – Joint Arrangements
This amendment clarifies the IFRS 3 and should be applied when an
investor acquires an interest in a jointly controlled entity when it is
a business as defined by this standard. The application of IFRS 3 is
required in the acquisition of the initial interest and subsequent
acquisition of interests.
Amendments:
• IAS 16 - Property, Plant
and Equipment;
• IAS 38 - Intangible
Assets.
The amendments clarify which methods of depreciation of tangible
fixed assets and intangible assets that are allowed.
Amendments:
• IAS 16 - Property, Plant
and Equipment;
• IAS 41 - Agriculture.
These amendments establish that biological assets that fall within
the definition of that bearer plants (eg vineyards, fruit trees, etc.)
should be recorded as tangible fixed assets.
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IAS 19 –Employee
(Amendment)
Benefits
Amendments to IFRS 10 Consolidated
Financial
Statements and IAS 28 Investments in Associates
IAS 27 – Separate Financial
Statements (2011) - Amendment
This amendment clarifies the circumstances under which employee
contribution for post-employment benefit plans are a reduction in
the cost of short-term benefits.
These amendments delete an existing conflict between the
standards, related to the sale or contribution of assets between the
investor and the associate or jointly controlled entity.
This amendment introduces the possibility of applying the equity
method in the valuation of investments in subsidiaries, associates
and jointly controlled entities in the separate financial statements
of an entity that presents consolidated financial statements.
These amendments include the clarification of various aspects
related to the application of the exception of consolidation by
investment entities.
Amendments to IFRS 10 Consolidated
Financial
Statements, IFRS 12 - Disclosure
of interests in other entities, and
IAS 28 - Investments in associates
and joint ventures (2011)
Amendment - IAS 1 –
Presentation
of
Financial
Statements (Disclosures)
This amendment introduces a set of instructions and guidelines to
improve and simplify the disclosures in the context of current IFRS
reporting requirements.
These improvements involve the review of several standards.
Improvements to International
Financial Reporting Standards
(cycles 2010-2012 and 20122014)
These standards have not yet been approved (“endorsed”) by the European Union and, as such,
were not adopted by the Group for the year ended as of June 30 2015.
2.2 BASIS OF CONSOLIDATION
The consolidation methods adopted by the Group in the preparation of the consolidated financial
statements are as follows:
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 ‘Non-controlling interests’, in
the consolidated statement of financial position and in the consolidated income statement.
Companies included in the consolidated financial statements using the full consolidation
method are listed in Note 5.
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Adjustments to the financial statements of Group companies are performed, whenever
necessary and considered relevant, in order to adapt accounting policies to those used by the
Group. Intra-group balances and transactions are eliminated on consolidation process.
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, excluding players’ registrations. 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.
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:
Buildings and other constructions - 8 to 50 years
Machinery and equipment - 4 to 50 years
Transport Equipment - 3 to 8 years
Office equipment - 3 to 8 years
Other tangible assets - 1 to 10 years
The building associated with the Dragon Stadium is being amortized over a period of 50 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 income’ or ‘Other expenses’.
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b) Intangible assets - Players’ registrations
The caption ‘Intangible assets - Players’ registrations’ includes costs related with the
acquisition of players’ registrations, including intermediation service costs, as well as signingon fees paid directly to the players, in accordance with the Decree-Law 103/97 of 13
September.
When the percentage owned of players’ registrations is less than 100% (see Note 8), it means
that although the Company 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.
If is estimated a loss on the recoverable amount of a player’s registration (‘impairment loss’),
the corresponding impact is recognized in the income statement under the caption
‘Amortization and impairment losses of players' registrations’. The recognition and
quantification of such impairment losses consider the carrying amount of players’
registrations, as of 30 June 2015, 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 player’s labour contract are also recorded
under the caption ‘Intangible assets - Players’ registrations’, being determined a new book
value for the player’s registration which is amortized over the remaining revised contract term.
Costs included in the caption ‘Intangible assets - Players’ registrations’ are amortized over the
period covered by contracts celebrated between the players and the Company, in accordance
with Decree-Law 103/97 of 13 September.
“Players on loan”
The acquisition costs of players’ registrations that are on temporary loan to other clubs are
maintained in the caption ‘Intangible assets - Players’ registrations’ and continue to be
amortized over the number of years these rights expire, according to the player’s labour
contract, as it’s considered to exist a potential vaporization of the player registration while the
player plays by other club under the referred loan. If a loss is estimated on the recoverable
amount (‘impairment loss’) of the players’ registrations on loan up to the end of the contract
period, namely when the player is borrowed in its last year of contract, the corresponding
effect is recorded in the income statement under the caption ‘Amortization and impairment
losses of players' registrations’.
c) Other intangible assets
Other intangible assets (non-players’ registration) are stated at acquisition cost net of
depreciation and accumulated impairment losses. Intangible assets are only recognized if it is
probable that future economic benefits will flow from them to the Group, 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 assets are available for use (Note 7).
d) Leasing 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
___________________________________________________________________________________________
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2014/2015
___________________________________________________________________________________________
IAS 17 - ‘Leases’. Accordingly, tangible assets are recorded as assets and corresponding
obligations as liabilities in the statement of financial position. 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 recognized 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.
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 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
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___________________________________________________________________________________________
reviewed and adjusted at the end of the reporting period 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 end of the reporting period. Investments classified as held to maturity have defined
maturities and the Group has the intention and ability to hold them until the maturity date.
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 statement of financial position 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 statement of financial position, 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.
Financial income is calculated in accordance with the effective interest rate, except for very short
term receivables when the income amounts to recognize would be immaterial.
Accounts receivables are recorded as current assets, except when its maturity is greater than 12
months from the end of the reporting period, when they are classified as non-current assets.
These financial assets are included in the captions presented in Note 11.
Impairment is recognized 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 counterparty;
- Default or delinquency in payments;
- It becoming probable that the counterparty will enter bankruptcy or financial re-organization.
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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.
The preferred shares issued by the company are classified as equity instrument when redemption
occurs only by company’s option and the dividends are paid by the company on a discretionary
basis.
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 rate 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 rate 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 end of the reporting period, which are classified as non-current. These
liabilities are included in the classes identified in Note 20.
vi) Discounted bills
Trade receivables represented by discounted bills that have not yet matured at the end of the
reporting period remain recorded in the statement of financial position 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 statement of financial position caption ‘Bank loans’.
viii) Other financial assets – Players economic rights
The amounts includes in the caption “Other financial assets – Players economic rights” are related
to the economic rights over several players whose sporting rights were sold by FCPorto SAD, while
keeping part of their economic rights. These assets are registered at cost, less possible impairment
losses.
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ix) Effective interest rate method
Effective interest rate method is a method of calculating the amortized cost of a financial asset or
liability and of allocating interest income or expense over the relevant period. The effective
interest rate method is the one used to calculate the amortization cost of a financial asset or
liability and to realize the income or cost allocation up to maturity of the financial instrument. The
effective interest rate is the one that, being used to discount estimated future cash flows
associated to the financial instrument, allows to meet its actual value to the financial instrument
value on the initial recognition date.
x) Impairment of financial instruments
Financial assets are analysed at each consolidated financial statement date to verify the existence
of impairment losses indicators.
The financial assets are considered in situation of impairment when there is objective evidence
that, as a consequence of one or more events occurred after the assets initial recognition the
estimated cash flows had been negatively affected.
For the financial assets measured at amortized cost, the impairment is calculated by the difference
between the asset's carrying amount and the present value of estimated future cash flows,
discounted at the financial asset's original effective interest rate.
For investments on subsidiaries, measured at acquisition cost less impairment, the impairment
analysis evolves the use of discounted cash flows models to estimate the value in use of the
referred investments. Such models imply that the Company estimated the present value of future
cash flows of the subsidiary company according to a discount rate in line with its associated risk.
It is the Board of Directors understanding that the use of the above mentioned methodology is
adequate to conclude on the eventual existence of financial investments impairment as it
incorporates the best available information as at the date of the financial statements
h) 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 full control of the Group.
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
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’).
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The companies included in the tax group, the June 30, 2015, taxed according to RETGS are as
follows:
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.
Dragon Tour – Agência de Viagens, S.A.
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. Besides the referred in Note 22 and 34
relatively to inspections, complaints and ongoing impeachments, the tax situation on the years
ended on 30 June 2012 and 30 June 2015 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 88 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 mentioned article.
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 and annually evaluated
using the tax rates expected to be in force or announced 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 when 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 and Accruals
Revenue is recorded at fair value of assets received or receivable, net of discounts.
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,
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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 with transactions of 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 and costs with liabilities relating to the ‘solidarity
mechanism’ (that corresponds to a compensation at the time of the transfer of a player to
another club, before the term of the respective sporting contract in is actual club, to its former
clubs that the players where registered since their 12th and their 23rd birthday – this amount
corresponds to 5% of the transfer value, to distribute proportionally among them, 0.25% from
12th to 15th anniversary and 0.5% from 16th to 23rd anniversary). 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 recognized in the income
statement when the significant risks and benefits of the player’s registration have been
transferred.
iii)
Contracts of association of economic interests
The gains arising from the celebration of contracts of association of economic interests, which
consists of an investment partnership, are recorded in the income statement or in statement
of financial position (liabilities), depending if the significant benefits and risks arising from
those transactions have been, or not, effectively and materially transferred, according to the
contractually defined.
iv)
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. The related costs, namely the players’ and technical staff’s
bonuses are equally recorded in the period in which participation is guaranteed. Variable
bonuses depending on sporting performance are recorded in the period the matches are
played.
v)
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 non-current assets’,
‘Other current assets’, ‘Other current liabilities’ and ‘Other non-current liabilities’
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m) Post-Employment benefits
The Group has committed to grant to certain employees cash benefits as pension
complements for retirement, which configure a defined benefit plan.
In order to estimate its liability for payment of these benefits, actuarial liabilities were
calculated in accordance with the “Projected Unit Credit Method”. Actuarial gains and losses
are recorded in the statement of other comprehensive income in the year they occur, as
defined in IAS 19. Pension liabilities are recognized on the balance sheet date under the
caption "Pension liabilities" and represent the present value of obligations for defined benefit
plans, adjusted for actuarial gains and / or liabilities for past services not recognized.
n) 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 end of the reporting period are recognised as gain or loss in the income
statement of the period.
o) Subsequent events
Events after the end of the reporting period that provide additional information on conditions
existing at the end of the reporting period (adjusting events), are reflected in the consolidated
financial statements. Events after the end of the reporting period that provide information
about conditions arising after the end of the reporting period (non-adjusting events), when
material, are disclosed in the notes to the financial statements (Note 35).
p) Judgements and estimates
In the preparation of the accompanying consolidated financial statements judgments and
estimates were made and several assumptions were used that affected the value of the assets
and liabilities presented, as well as the presented amounts of revenues and expenses for the
period.
Estimates used and underlying assumptions were determined based on the best information
available of the ongoing events and transactions, at the approval date of these financial
statements, as well as based on best knowledge of past and present events. However, not
foreseeable situations may occur in subsequent periods, which were not considered in these
estimates. Changes to these estimates that occur in subsequent periods will be prospectively
corrected. For this reason and considering the uncertainty level incorporated, actual results of
these transactions may differ of the corresponding estimates.
The most significant accounting estimates reflected in the consolidated income statements
include:
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(i)
(ii)
(iii)
Useful lives of tangible and intangible assets;
Impairment analysis of Goodwill, of financial assets (namely, players’ economic
rights), of the intangible assets – players’ registrations (Note 2.3.b)), and of
other tangible and intangible assets;
Recognition of adjustments on assets and provisions.
q) 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 32.
3.
FINANCIAL RISK MANAGEMENT
In addition to the risks inherent to the results of the sports’ activity and its’ impacts on the
economic results and on the assets appreciation, the Group’s activity is also 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 and fixed 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 2015 and 2014, the Group presents a debt of approximately 172,543 thousand
Euro and 149,169 thousand Euro, respectively, divided between current and non-current loans
(Notes 18 and 19) contracted with various financial institutions.
Interest rate sensitivity analysis
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
indebtedness in the season 2014/2015. For financial instruments, the analysis was prepared on
the understanding that changes in market interest rates affect interest income or expenses of
financial instruments indexed to variable interest rates.
The mentioned analysis pointed out that if the Euribor had been 50 basis points higher and all
other variables held constant, the financial charges for the year ended 30 June 2015 would
increase by, approximately 234,000 Euro (327,000 Euro in the financial year ended 30 June 2014).
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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 insignificant, 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 exposure 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 various sponsorships. The credit risk refers to the risk of
the 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, or
when the account receivable is greater than normal, 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 2015 and 2014 are disclosed in Note 22.
As of 30 June 2015 and 2014, 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
22.
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.
This 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. Normally, each contract loan is guaranteed by a receivable
account balance (due to player’s registration sale, or due to receivables amounts related to
___________________________________________________________________________________________
48
2014/2015
___________________________________________________________________________________________
European competitions bonuses and broadcasting rights); additionally, usually, 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, and 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.
Regarding the liquidity risk, as of 30 June 2015, despite the consolidated financial statements
show a equity attributable to equity holders of the parent company of 24 million Euro and a
negative working capital in approximately 25 million Euro (84 million Euro as of 30 June of 2014),
it is conviction of the Board of Directors that based (i) on loans obtained, or in the process of be
obtained (ii) on the renegotiation of maturities of existing loans, as well as (iii) the predictions
of the eventual financial reinforcement resulting from the sale of players registration sporting
rights, as it has been usual in prior years, this risk is properly mitigated.
3.4.
Regulatory risk - “ Financial Fair Play “
FCP, SAD is subjected to the licensing system for admission of football clubs in participating on
UEFA organized competitions: "UEFA Club Licensing and Financial Fair Play Regulations".
This regulation governs the rights, duties and responsibilities of all parties involved in the club
licensing system for participation in the UEFA competitions and sets in particular the sport’s
related to infrastructures, administrative and staff-related, legal and financial minimum criteria
to be met by a sports company in order to obtain a license to participate in UEFA club
competitions as part of the admission process to the competition.
According to this system FCP SAD, will have to meet a set of requirements, among which the
following stands out:
1. Inexistence of overdue and unpaid debts (i) with football clubs regarding the players’
registrations transfers and (ii) towards employees and/or tax authorities and social security;
2. Verification of the equilibrium ("breakeven") between the relevant revenues and relevant
costs, which the acceptable accumulated deviation raises to a 5 million Euro for a monitoring
period equivalent to the sum of three exercises (the three previous seasons, except the first year
of application of this criteria (season 2013/2014) in which it was considered only two seasons).
However, this negative deviation may be exceeded if such excesses are fully covered by equity
contributions from shareholders or and / or related parties:
• Seasons of 2013/14 and 2014/15: 45 million Euro;
• Seasons of 2015/16, 2016/17 and 2017/18: 30 million Euro
The sanctions for non-compliance with these rules may include (i) warnings, (ii) fines, (iii)
retention of premiums paid and, ultimately, (iv) the prohibition to participate in UEFA’s
organized competitions.
The FCP-SAD has been monitoring his situation regarding the new Financial Fair Play criteria
and is currently complying with these requirements.
3.5.
Sportive risk
The main activity of FCP, SAD is the participation in national and international professional
football competitions. Therefore, the Company depends on the existence of these sportive
competitions, the maintenance of their participation’s rights, the maintenance of the premiums
paid under these competitions and the sportive performance achieved by its professional
___________________________________________________________________________________________
49
2014/2015
___________________________________________________________________________________________
football team, particularly the possibility of qualifying for the European competitions mainly the
UEFA Champions League. By its turn, sports performance may be affected by the sale or
purchase of players’ registrations considered essential for the sportive performance of FCP, SAD.
As predicted in the sports companies’ activity, FCP, SAD regularly sells regularly its players’
registrations. In the acquisition of each players’ registrations, there is no guarantee that the
value of a potential sale corresponds to their fair value or even that there will be interested
buyers in acquiring the players’ registrations of a certain player. As usual in its activity, FCP, SAD
has players’ registrations that may be sold at any time, and, in case of sale of those players’
registrations, it may not be possible to find players that replace the players that were sold,
providing at least the same level of performance.
Significant part of the operating income of FCP, SAD arises from the sale of football matches’
broadcasting rights of advertising contracts. These revenues are dependent on the media and
sports projection of their main football team as well as the negotiating power of FCP, SAD
towards the entities to which these exploitation rights are transferred of those activities. In
addition, FCP, SAD is dependent on the ability of counterparties to such contracts comply with
the agreed payments and, ultimately, to be possible to find other competitors in the market of
those entities.
Costs related with the set of FCP, SAD football players, assume a determining weight in its
operating results. The profitability and the economic and financial balance of the Company are,
therefore, significantly dependent on the ability of the FCP, SAD Management to ensure a
moderate increase in average costs per player and the rationalization of the number of players,
specially taking into account the criteria of Financial Fair Play defined in Section 3.4.
4.
CHANGES IN ACCOUNTING POLICIES, ESTIMATES AND ERRORS
During the year there were no changes in accounting policies, nor changes in estimates and
material errors related with prior periods.
5.
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, the percentage of share capital held by the Group and activity as of 30 June 2015
and 2014 are as follows:
___________________________________________________________________________________________
50
2014/2015
___________________________________________________________________________________________
Company
Futebol Clube do Porto – Futebol,
S.A.D.
Head Office
Porto
Activity
Participation in professional footbal competitions and the
sporting events promotion and organization
PortoComercial – Sociedade de
Comercialização, Licenciamento e
Porto
Sponsorização, S.A. (“PortoComercial”)
Image rights commercialization, sponsoring, merchandising and
products licensing.
F.C.PortoMultimédia - Edições
Multimédia, S.A. (“PortoMultimédia”)
Editing, production and commercialization of multimedia material
and to the Inetrnet, periodical and non-periodical publications.
Porto
%
participation
held
%
participation
held
30.06.2015
30.06.2014
Parent
company
Parent
company
93.50%
93.50%
70%
70%
100%
100%
90%
90%
PortoEstádio – Gestão e Exploração de
Equipamentos Desportivos, S.A.
Porto
(“PortoEstádio”)
Sport equipmentmanagement and exploration.
PortoSeguro - Sociedade Mediadora de
Porto
Seguros do Porto, Lda. (“PortoSeguro”)
Insurance brokerage.
Dragon Tour, Agência de Viagens, S.A.
Porto
(“DragonTour”)
Organization and sale of travek and tour packages; ticket and
seat reservation; representation of other travel agencies and
tourism.
93.50%
93.50%
FC Porto – Media, S.A. (“FCPMedia”)
Porto
Concept, design, development, production, direction, promotion,
marketing, acquisition, exploration rights, recording, distribution
and dissemination of works and audiovisual progrms,
multimedia, television, video, cinema, theme, internet, channels,
tourist events, cultural and sporting in any formats and systems;
managing, operating ad providing services in the areas of
recording, production and communication of audiovisual works,
television shows, souns, images, and any other audiovisual
media; issue periodic publicities, books and multimedia.
98.78%
98.78%
Euroantas, Promoção e Gestão de
Empreendimentos Imobiliários, S.A.
(“Euroantas”) (a)
Porto
Exploration of property assets, namely "Estádio do Dragão"
47%
0%
(a) An entity that became part of the consolidation perimeter on 22 October 2014.
6.
CHANGES TO THE CONSOLIDATION PERIMITER
2014/15
On 22 October 2014 FC Porto SAD acquired a stake equivalent to 47% of the share capital of
Euroantas to FC Porto (Club). The Board of Directors of FC Porto, SAD understood that, by
acquiring this participation and by having passed to control the financial and operating policies of
Euroantas, FC Porto SAD holds control over Euroantas; as so this entity became part of the
consolidation perimeter as from that date.
As at that date (22 October 2014) the fair value of the assets and liabilities of that subsidiary as
well as the computation of goodwill, are as follows:
___________________________________________________________________________________________
51
2014/2015
___________________________________________________________________________________________
Assets
Tangible fixed assets (Note 7)
Costumers
Cash and cash deposits
Deferred assets
Other accounts payable
106,779,263
4,154,557
10,889
6,298,324
3,901,535
340,232
Liabilities
Loans obtained
Derivatives
Suppliers
Deferred liabilities
Others
(15,269,690)
(786,967)
(8,845,392)
(18,571,199)
(120,332)
Net assets
Total effective percentage
Equity value acquired
77,891,220 (iii)
47.00% (ii)
51,756,250 (i)
32,228,461 (iv)=(i)/(ii)-(iii)
Diference between the accounting value and tax value of the Stadium
Tax rate
Deferred tax liabilities
10,727,247
21%
2,252,722 (v)
Total Goodwill (Nota 7)
34,481,183 (vi)=(v)+(iv)
58,363,431 (vii)=(i)/(ii)-(i)
The Goodwill of Euroantas, arising from the acquisition, was computed based on the financial
statements of the acquired subsidiary reported as of October 22, 2014. It fair allocation
exercise of the acquired assets and liabilities, differences were detected in relation to the book
value, having this Goodwill been fully allocated to the value of the fixed tangible asset "Estádio
do Dragão" (the main activity of this company is the exploitation of real estate assets, namely
the " Estádio do Dragão ", which is the major component of its assets) in accordance with an
independent evaluation. However, the determination of the goodwill was been provisionally
determined, as the Group can proceed to its recalculation and recognition of eventual
adjustments to those provisional values within twelve months after the date after the
acquisition date.
If this acquisition had been reported as of 1 July 2014, the income for the year the Group ended
June 30, 2015 would increase in the amount of approximately 282,000 Euros and net income
would have decreased by approximately 7,000 euros.
2013/14
On July 30, 2013, was approved at the General Shareholders’ Meeting of FC Porto Media, S.A.,
the increase of its share capital from 50,000 Euro to 4,050,000 Euro by the reinforcement of
four million Euro, carried solely by the shareholder Football Club Porto - Futebol, SAD as
follows: (i) in the form of new contributions in kind - conversion of loans into equity in the
amount of 1,355,850 Euro, through the issue of 271,170 shares with a nominal value of 5 Euro
___________________________________________________________________________________________
52
2014/2015
___________________________________________________________________________________________
each and (ii) in the form of new cash inflows in the amount of 2,644,150 Euro, through the
issuance of 528,830 shares with a nominal value of 5 Euro each.
In the sequence of this capital increase operation in FC Porto - Media, S.A., FC Porto, SAD now
holds directly 98.78% of the subsidiary’s share capital (which corresponds to a total holding
percentage, directly and indirectly, of 98.81%) and the control of that company, therefore it
was included in the consolidation perimeter by the full consolidation method with reference
to that date.
The fair value of assets and liabilities at the date of the first consolidation of that subsidiary
(July 31, 2013), as well as the computation of goodwill generated, was as follows:
Assets
Tangible fixed assets
Costumers
Cash and cash deposits
Liabilities
Auppliers
Net assets
Total effective percentage
262,933
902,946
340,207
2,149,061
(1,851,128)
(690,469)
1,113,550
98.81%
Equity value acquired
1,100,330
13,220
1,113,550
(i)
Capital increase amount
Investment of the Group on FCP Media
before the capital increase operation
Acquisition value
4,000,000
2,000
4,002,000
(ii)
Computed Goodwill
2,901,670
(iii) = (ii) - (i)
The goodwill of the FCP - Media, S.A., arising from the acquisition, was computed based on the
financial statements of the subsidiary acquired as of July 31, 2013. In fair value allocating
exercise of the assets and liabilities acquired, no differences were detected when comparing
with its book value, so the difference between these and the value of the investment was
recorded as Goodwill. However, the determination of the Goodwill has been provisionally
determined, as the Group can proceed to its recalculation and recognition of eventual
adjustments to those provisional values within twelve months after the acquisition date.
If this acquisition had been reported as of July 1, 2013, the revenue of the Group for the year
ended as of June 30, 2014 would have increased in the amount of approximately 282,000 Euro
and net income would have decreased by approximately 53,000 Euro.
___________________________________________________________________________________________
53
2014/2015
___________________________________________________________________________________________
7.
TANGIBLE AND OTHER INTANGIBLE ASSETS
During the years ended 30 June 2015 and 2014, the movements in tangible and other intangible
assets, as well as depreciation and accumulated impairment losses, were as follows:
Tangible Assets
30.06.2015
Land and
Buildings
natural
and other Machinery and
resources Construtions Equipment
Gross cost:
Opening balance (30.06.2014)
Changes in consolidation perimeter (Note 6)
Imputation of the fair value (Note 6)
Additions
Regularizations
Closing balance (30.06.2015)
1,102,098
13,830,598 93,909,553
- 34,481,183
101
13,830,598 129,492,935
Carrying value
Fixed
tangible
assets in
equipment
assets
progress
35,398,545
1,143,230
1,143,230
2,292,856
19,764
2,312,620
256,679
126,504
383,183
815,538
19,809,090
2,129,295
22,753,923
2,797,163
13,095,364
489,943
16,382,470
1,037,514
46,303
1,083,817
2,136,143
17,109
57,731
2,210,983
256,411
18,594
2,316
277,321
13,830,598 106,739,012
19,016,075
59,413
101,637
105,862
Accumulated depreciation
and impairment losses
Depreciation
-
3,445,312
31,833,001
120,232
Vehicles
Other
Office
Total
8,240,175
- 139,719,420
- 34,481,183
112,499
232,731
101
112,499 182,673,610
-
7,042,769
32,940,157
2,725,588
42,708,514
112,499 139,965,096
Tangible Assets
30.06.2014
Buildings and
other
constructions
Machinery and
equipment
Vehicles
Office
equipment
Other
tangible
assets
Tangible fixed
assets in
progress
Total
Gross cost:
Additions
Disposals
Regularizations
822,598
279,500
1,102,098
3,438,884
6,428
3,445,312
1,264,527
37,303
(158,600)
1,143,230
2,292,025
831
2,292,856
256,679
256,679
218,551
(218,551)
-
8,293,264
280,331
43,731
(158,600)
(218,551)
8,240,175
Depreciations
Sales
Regularizations
714,362
17,029
86,500
(2,353)
815,538
2,599,694
197,469
2,797,163
1,129,255
66,858
(158,599)
1,037,514
2,037,514
369
98,260
2,136,143
251,333
5,078
256,411
-
6,732,158
17,398
454,165
(158,599)
(2,353)
7,042,769
Carrying amount
286,560
648,149
105,716
156,713
268
-
1,197,406
Other intangible assest
30.06.2015
Industrial
property
Others
Total
Gross cost
2,465,597
2,465,597
227,432
227,432
2,693,029
2,693,029
Depreciation
705,079
45,466
750,545
223,822
3,478
227,300
928,901
48,944
977,845
1,715,052
132
1,715,184
Carrying amount
___________________________________________________________________________________________
54
2014/2015
___________________________________________________________________________________________
Other intangible assets
30.06.2014
Industrial
property
Others
Total
Gross cost
Additions
2,344,848
120,749
2,465,597
227,432
227,432
2,572,280
120,749
2,693,029
Depreciation
668,603
36,476
705,079
155,124
68,698
223,822
823,727
105,174
928,901
1,760,518
3,610
1,764,128
Carrying amount
The caption ‘Industrial property’ relates, essentially, to the right to use the FCP trademark
during a period of 99 years, and is being amortised over that period.
8. INTANGIBLE ASSETS - PLAYERS’ REGISTRATIONS
During the financial years ended 30 June 2015 and 2014, the movement in ‘Players’
registrations’ as well as depreciation and accumulated impairment losses, was as follows:
Intangible Assets
- Player's registrations
30.06.2015
30.06.2014
Gross Cost
Opening balance
Acquisitions
Sales
Transfers (Note 9)
Disposals (Note 27)
Closing balance
117,698,516
53,372,782
(46,285,529)
(250,000)
(4,326,192)
120,209,577
120,789,429
18,789,708
(20,827,879)
(8,599)
(1,044,143)
117,698,516
Opening balance
Depreciation (Note 27)
Impairment losses for the year (Note 27)
Sales
Disposals (Note 27)
Closing balance
56,192,875
30,227,292
1,146,645
(29,955,014)
(3,311,935)
54,299,863
44,630,531
26,379,179
563,333
(14,524,217)
(855,951)
56,192,875
65,909,714
61,505,641
Carrying amount
Acquisitions
The main acquisitions made in the year ended 30 June 2015, in amount, can be resumed as follow:
___________________________________________________________________________________________
55
2014/2015
___________________________________________________________________________________________
Player
Adrian Lopez
Martins Indi
Brahimi
Quintero
Aboubakar
Marcano
Hernani
Otávio
Evandro
Outros
Economic
rights
percentage
Acquisition
date
Vendor
Contract
end date
60%
100%
100%
50%
30%
100%
75%
33%
100%
jul-14
jul-14
jul-14
dez-14
ago-14
ago-14
fev-15
ago-14
jul-14
Club Atlético de Madrid
Feyenoord Rotterdam N.V.
Granada Club de Futbol
Delfino Pescara 1936 SRL
Football Club Lorient
Football Club Rubin
Vitória Sport Clube - Futebol, SAD
Coimbra Esporte Clube Ltda.
Estoril Praia, SAD
jun-19
jun-18
jun-19
jun-17
jun-18
jun-18
jun-19
jun-19
jun-18
Acquisition
cost
Additional
expenses
11,000,000
7,700,000
6,500,000
4,500,000
3,000,000
2,650,000
2,900,000
2,500,000
2,350,000
600,000
361,620
580,000
640,000
120,000
400,000
500,000
Efeito atualização financeira
Valor líquido
Total
acquisition
cost
11,000,000
8,300,000
6,861,620
4,500,000
3,580,000
3,290,000
3,020,000
2,900,000
2,850,000
4,492,963
50,794,583
2,578,199
53,372,782
The caption “Additional expenses” refers to expenses related to the purchase of players’
registrations, namely charges for intermediation services, legal services, signing-on fees paid
directly to the players, etc.
It should be noted that in situations where the registration is less than 100%, although the
Company 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 a future
transaction of these rights, if it happens.
The main acquisitions made in the year ended 30 June 2014, in amount, can be resumed as follow:
Player
Quintero
Ghilas
Kayembe
Igor Lichnovski
Outros
Economic
rights
percentage
Acquisition
date
50%
50%
85%
100%
jul-13
jul-13
jun-14
jun-14
Vendor
Delfino Pescara 1936 SRL
Moreirense
Danubio GmbH
Universidade do Chile
Contract
end date
jun-17
jun-17
jun-19
jun-18
Acquisition
cost
5,000,000
3,800,000
2,615,000
1,837,000
Additional
expenses
800,000
61,587
100,000
Total
acquisition
cost
5,800,000
3,800,000
2,676,587
1,937,000
5,050,444
19,264,031
Efeito actualização financeira
(474,323)
Valor líquido
18,789,708
The charges for intermediation services related with the purchase of players’ registrations in the
years ended 30 June 2015 and 2014 referred above, as well as with the negotiation and
renegotiation of labour contracts with players, amounted to 6,863,545 Euro and 4,829,328 Euro,
respectively.
In the financial year ended 30 June 2015 these services were provided by Gespro Sport, SL, Bahía
Atlántica S.L., Japer Sport, S.R.L., Eurogol – Consultoria e Marketing Esportivo, Ltda, Gesdek –
Gestão Desportiva, Lda., RAMP – Managment Group International, A.R.B. Sport Asesores SL, Idub
Servicios Desportivos, SL, Idoloasis – Soc. Unipessoal, Lda., Termford Managment Limited, SP
International Management GMBH, Northfields Sports B.V, Tramontin Advogados, Foot2Foot –
Gestão de Carreiras Desportivas, Lda., Prestige Sports Managment Limited, FootInvest, SA, D.L.
Soccer Service SAS, JOD - Gestão de carreiras desportivas, Lda., Vela Managment Limited and
Unifoot – Gestão e Eventos de carreiras de profissionais desportivos, S.A., Nescar Sports, S.L. and
by the agents Maxime Nana, Luis Pompeo, Graham Heydorn and José Caldeira.
___________________________________________________________________________________________
56
2014/2015
___________________________________________________________________________________________
In the financial year ended 30 June 2014 these services were provided by Pearl Design Holding
Limited, Edenresults, Danubio GmbH, DNN Lda., Idolasis, Soc. Unipessoal, Lda., Onsoccer, Gestão
de Carreiras Desportivas S.A., Foot Expande, Lda., RAMP Managment Group International, DL
Soccer Service SAS, Unifoot – Gestão e Eventos de Carreiras de Profissionais Desportivas, SA,
Asesorias e Inversiones Aim Futbol Limitada, C.B. Nafricatalentsport, Lda., SportConsult and
Pacheco & Teixeira, Lda. And by the agent Ricardo Calleri.
The amounts of players registrations’ purchases in the years ended as of June 30, 2015 and 2014,
consider the effect of discounting future payments to its present value, where applicable, in the
amounts of, approximately, 2,578,199 Euro and 798,204 Euro, respectively. These amounts refer
to the long term account payables balances related with the acquisition of the registrations of
players, namely Adrian Lopez, Brahimi, Evandro, Martins Indi, Octávio, Hernâni, Sérgio Oliveira
and Quintero (30 June 2015) and Ghilas, Quintero, Kayembe, Opare and Igor Lichnovski (30 June
2014).
Sales
Sales made during the financial year ended 30 June 2015 generated capital gains of 86,470,297
Euro (Note 27) which result mainly from:
a) sale of the registration rights of Mangala to Manchester, by the amount of 30,503,590 Euro,
generating capital gains of 22,806,942 Euro after the deduction global values of 11,073,331 Euro
relative to (i) the effect of discounting future medium term receipts and payments to its present
value arising from these transactions; (ii) responsibilities with the solidarity mechanism; (iii)
intermediation service costs provided by Gestifute – Gestão de carreiras de Profissionais
Desportivos, S.A and (iv) amounts payable to the player as termination compensation; (v) the
carrying amount of the player’s registration on the date of sale. Additionally, the buying club
assumed the obligation to pay directly to Doyen the proportion that this entity held on the
economic rights of the player for the liability recognized in the caption "Other creditors" on June
30, 2014, in the amount of 3,376,684 Euro, which was reversed and recognized in the computation
of the capital gain;
b) Sale of registration rights of Defour to Anderlecht by the amount of 6,000,000 Euros, generating
a capital gains of 2,683,593 Euro, after deducting the total amount of 3,316,407 Euro relating to:
(i) solidarity costs, (ii) liabilities relating to the solidarity mechanism; (iii) the proportional sale
value of the registration player’s owned by third parties (10%); (iv) annulment of amounts payable
to the player; and (v) the carrying amount of the player’s registration on the date of sale;
c) Sale of registration rights of the player Danilo to Real Madrid by the amount of 31,500,000 Euro,
generating capital gains of 23,101,403 Euro, after deducting the total amount of 8,398,597 Euros
relating to: (i) the effect of discounting future medium term receipts and payments to its present
value arising from these transactions; (ii) proportion of the capital gain attributable to Santos
Football Club; (iii) intermediation service costs provided by Elenka B2F Sports LTDA; and (iv) the
carrying amount of the player’s registration on the date of sale;
d) Sale of registration rights of the player Jackson Martinez to Atletico Madrid for the amount of
35,000,000 Euro, which generated a capital gain of 26,633,515 Euro, after deducting the total
amount 8,366,485 Euro relating to: (i) the proportional sale value of the registration player’s
owned by third parties (5%), (ii) the proportion of the capital gain attributable to Northfields
___________________________________________________________________________________________
57
2014/2015
___________________________________________________________________________________________
Sports BV, (iii) compensation for the termination of the player’s sports employment contract; and
(iv) the carrying amount of the player’s registration on the date of sale.
The disposals for the year ended June 30, 2014, which generated capital gains in the amount of
22,397,504 Euro (Note 27) resulted primarily from:
a) sale of the registration rights of Atsu to Chelsea, by the amount of 3,000,000 Euro, generating
capital gains of 1,991,667 Euro after the deduction of (i) the effect of discounting future medium
term receipts and payments to its present value arising from these transactions; (ii) the
proportional sale value of the registration player’s owned by third parties (25%); (iii)
intermediation service costs provided by Energy Soccer and (iv) the carrying amount of the player’s
registration on the date of sale, in the global amount of 1,008,333 Euro;
b) sale of the registration rights of Otamendi to Valencia, by the amount of 12,000,000 Euro,
generating capital gains of 7,980,195 Euro, after deduction of: (i) the effect of discounting future
medium term receipts and payments to its present value arising from these transactions; (ii) the
proportional sale value of the registration player’s owned by third parties; (iii) intermediation
service costs provided by Vela Management Limited; and (iv) the carrying amount of the player’s
registration on the date of sale in the global amount of 4,026,000 Euro. Additionally this agreement
foresees the payment of a variable remuneration, payable upon the achievement of certain sport
objectives by the athlete, so the global amount receivable could rise up to 15,000,000 Euro;
c) sale of the registration rights of André Castro to Kasimpasa, by the amount of 2,058,000 Euro,
generating capital gains of, approximately, 1,654,000 Euro, net of: (i) the effect of discounting
future medium term receipts and payments to its present value arising from these transactions;
(ii) intermediation service costs provided by Pacheco & Teixeira, Ltd.; (iii) the proportional sale
value of the registration player’s owned by third parties (5%); (iv) liabilities relating to the
‘solidarity mechanism’, and (v) the carrying amount of the player’s registration on the date of sale
in the global amount of approximately 404,000 Euro;
d) sale of the registration rights of Fernando to Hellas Manchester City, by the amount of 15,000,000
Euro, generating capital gains of, approximately, 5,298,000 Euro, net of: (i) the effect of
discounting future medium term receipts and payments to its present value arising from these
transactions; (ii) intermediation service costs provided by Onsoccer Internacional Career Gestão
de Carreiras, SA; (iii) the proportional sale value of the registration player’s owned by third parties
(20%); (iv) amounts payable to the player as indemnity; and (v) the carrying amount of the player’s
registration on the date of sale in the global amount of approximately 9,702,000 Euro;
e) sale of the registration rights of Iturbe to Hellas Verona Football Club, by the amount of 15,000,000
Euro, generating capital gains of, approximately, 4,736,000 Euro, net of: (i) intermediation service
costs provided by IG Teams & Players, SA; (ii) the proportional sale value of the registration player’s
owned by third parties (55%); and (iii) the carrying amount of the player’s registration on the date
of sale in the global amount of approximately 10,264,000 Euro;
___________________________________________________________________________________________
58
2014/2015
___________________________________________________________________________________________
Impairment losses for the year
During the year ended June 30, 2015 impairment losses were recorded amounting 1,146,645 Euro
were recorded related with the registration of the players Djalma, Opare and Quinones, because FCP
SAD terminated the labour contract with this player during the season 2015/16.
During the financial year ended 30 June 2014, impairment losses amounting 563,333 Euro were
recorded related with the registration of the players Stefanovic because FCP SAD terminated the
labour contract with this player during the season 2014/15 and Izmailov, by the fact of the player has
been lent during the season 2014/15 being this the last season with labour contract.
Additionally, during the year ended June 30, 2014, player registrations with a net value of 188,192 Euro
were write-offed, related to the players Lucho Gonzalez and Thibaut Vion by the fact that FCP SAD
terminated the labour contract with this players during the season.
Player’s registration
On June 30, 2015 and 2014, the aggregation of players by range of its’ registration net book value is as
follows:
30.06.2015
Carrying amount of
players registrations
Number of
players
Amount
30.06.2014
Number of
players
Amount
Greather than 2 million Euro
Between 1 and 2 million Euro
12
5
46,152,407
7,860,617
10
7
42,003,228
9,979,852
Less than 1 million Euro
40
57
11,896,690
65,909,714
28
45
9,522,561
61,505,641
As of 30 June 2015 and 2014, in the carrying amount of players’ registrations are included the following
players:
___________________________________________________________________________________________
59
2014/2015
___________________________________________________________________________________________
30.06.2015
Player
Adrian Lopez (a)
Quintero (a)
Martins Indi
Brahimi (b)
Herrera
(a)
Hernâni
Aboubakar
Diego Reyes
Marcano
Alex Sandro
(a)
(e)
(a)
Otavio
Evandro
Kayembe
(a)
(a)
Ghilas
Andrés Fernandez
Gudiño
Ricardo Pereira
(a)
(e)
Kléber
Licá
(a)
(a)
(a)
Kelvin
Igor Lichnovsky
Walter da Silva (b) (d)
Hector Quiñones
Defour (c)
(f)
Mangala (c)
Danilo (c)
Jackson Martinez
a)
b)
c)
d)
e)
f)
(c)
30.06.2014
Players'
registration (%)
End of
Contract
Players'
registration (%)
End of
Contract
60.0%
jun/19
-
-
100.0%
100.0%
jun/17
jun/18
50.0%
-
jun/17
-
50.0%
80.0%
jun/19
jun/17
80.0%
jun/17
75.0%
30.0%
jun/19
jun/18
-
-
47.5%
100.0%
jun/18
jun/18
47.5%
-
jun/18
-
100.0%
jun/16
100.0%
jun/16
32.5%
100.0%
jun/19
jun/18
-
-
85.0%
jun/19
85.0%
jun/19
50.0%
jun/17
50.0%
jun/17
90.0%
85.0%
jun/18
jun/18
-
-
80.0%
Jun-19
80.0%
Jun-18
70.0%
jun/16
70.0%
jun/16
60.0%
Jun-17
60.0%
Jun-17
75.0%
55.0%
jun/18
Jun-18
75.0%
55.0%
jun/16
Jun-18
15.0%
jun/17
15.0%
jun/17
100.0%
jun/16
100.0%
jun/16
-
-
56.7%
jun/16
-
-
56.7%
jun/16
-
-
100.0%
jun/16
-
-
100.0%
jun/16
Player loaned to another club or sports entity in the season 2015/16, whose loan period is not beyond June 30, 2016;
Players whose percentage of economic rights evidenced is deduced, as of June 30, 2014, the share of 50% (Walter
da Silva) and 50% (Brahimi) transferred to third parties by associated financial interests contracts;
Player whose registration rights was sold to another club or sports entity during the 2014/15 sports season;
Player loaned to another club or sports entity in sports season 2015/16, but which the loan period is not beyond
December 31, 2015;
Player whose registration rights was sold to another club or sports entity during the 2015/16 sports season;
Player which terminated the employment contract in the beginning of the season 2015/16.
The registrations’ percentages presented above take into consideration the sharing of economic rights
made on the acquisition date of each player’s registration, or its sale at a later date, as well as the
percentages assigned by FCPorto SAD to third parties related with the sharing of the amount resulting
from a future sale of these rights.
In addition, commitments were established with third parties, including clubs and sports agents, in
order to share the amount of future capital gains that may be obtained through FC Porto SAD players
registration rights’ sale, upon verification of specific contractual conditions.
___________________________________________________________________________________________
60
2014/2015
___________________________________________________________________________________________
As of 30 June 2015, FCP SAD kept player’s registrations that had been pledged as security for loans, as
follow:
Bank
Amount
30.06.2015
Millennium BCP 2,500,000
Novo Banco
25,000,000
Due date
30/06/2017
30/09/2015
Player
registrations'
Helton
Herrera e Brahimi
End of
contract
Jun17
Jun17 e Jun19
Additionally, buy and sale option rights contracts regarding players’ economic rights were established
with third parties, namely clubs and sports agents, exercisable for periods and amounts contractually
established.
9. OTHER FINANCIAL ASSETS
During the financial years ended 30 June 2015 and 2014, the movements under the caption ‘Other
financial assets’ as well as accumulated impairment losses, were as follows:
30.06.2015
Gross cost
Opening balance
Acquisitions
Transfers (Note 8)
Sales
Disposals
Closing balance
30.06.2014
1,923,036
157
250,000
(658,333)
(1,199,434)
315,426
3,951,834
(1,999)
8,599
(2,035,398)
1,923,036
1,202,037
432,114
(411,458)
(1,199,434)
23,259
1,705,266
1,532,169
(2,035,398)
1,202,037
292,167
720,999
Accumulated impairment losses
Opening balance
Impairment losses of the year (Notes 22 and 30)
Sales
Disposals
Closing balance
Carrying amount
The detail of this caption as of 30 June 2015 and 2014 is as follows:
___________________________________________________________________________________________
61
2014/2015
___________________________________________________________________________________________
Description
30.06.2015
Acquisition
% participation
cost
Other companies
30.06.2014
Acquisition
% participation
cost
15,277
Other investments
Carlos Eduardo
Prediger
Souza
Soares
50%
-
15,120
250,000
-
50%
25%
70%
664,950
658,333
448,000
Other palyers
50,150
300,150
136,633
1,907,916
Accumulated impairment losses (Note 22)
(23,260)
292,167
(1,202,037)
720,999
The caption ‘Other financial assets’, detailed above includes economic rights of several players, whose
sporting rights were sold by FCPorto SAD, while keeping part of their economic rights.
During the year ended 30 June 2015 and 2014 were estimated impairments related to these players’
economic rights that match the best Board of Directors’ estimate of the recoverable value expected
from these investments.
10. GOODWILL
In the year ended June 30, 2015 and 2014, the detail of goodwill is as follows:
PortoSeguro
FC Porto - Media, S.A.
30.06.2015
238,045
2,901,670
3,139,715
30.06.2014
238,045
2,901,670
3,139,715
This balance as of June 30, 2015, refers to the Goodwill computed as follow:
(i)
(ii)
During the year ended June 30, 2014, following the capital increase operation in FCP Media,
S.A., the FCP SAD holds now 98.78% of the its share capital in the amount of 2,901,670 Euro
as described in Note 6.
During the year ended June 30, 2007, in the acquisition of 90% of the share capital of
PortoSeguro, Lda., in the amount of 717, 647 Euro, deducted from the accumulated
impairment losses calculated in previous years in the amount of 479,602 Euro.
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 2015 and 2014, the Group has tested the goodwill
impairment, haven’t estimated additional impairment losses to be recognized.
For impairment assessment purposes of the subsidiaries PortoSeguro and FC Porto – Media, S.A., 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 mentioned business plan are as follows:
Period used: 5 years cash-flow projection
___________________________________________________________________________________________
62
2014/2015
___________________________________________________________________________________________
Growth rate (g)(1): 2.0%
Discount rate (2): 10,7%
(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, based on the discounted value of the forecasted cash flows of the Cash
Generating Unit of these business segments, discounted at the rate of 10.7%, concluded that, as
of 30 June 2015, the recoverable amounts exceed the carrying amount of their net assets, not
having been established any additional need of impairment recognition.
The Company performed sensitivity analyzes as follows:
- An increase of 0.5% in the assumption of the discount rate over the years of the projections
would not generate additional impairment losses, on June 30, 2015;
- A null perpetuity growth rate would not generate additional impairment losses, on June 30,
2015;
The projected cash flows were based on the historic performance and on the expectations
regarding future development of the business.
11. TRADE RECEIVABLES
Non-current assets
The detail of non-current balances of ‘Trade receivables’ as of 30 June 2015 and 2014 is as follows:
Trade receivables - current accounts
Transactions of players' registrations
Futebol Clube do Porto
Effect of discouting trade receivables
30.06.2015
30.06.2014
14,500,000
14,500,000
11,243,921
11,243,921
(954,816)
-
13,545,184
11,243,921
As of June 30, 2014, the caption "Non-current assets - Customers - Futebol Clube do Porto" refers
to the medium and long-term Futebol Clube do Porto’s account receivable, which was settled in
the second semester of 2014.
Current Assets
The detail of current balances of ‘Trade receivables’ as of 30 June 2015 and 2014 is as follows:
___________________________________________________________________________________________
63
2014/2015
___________________________________________________________________________________________
30.06.2015
Trade receivables - current accounts:
Current operations
60,563,818
14,405,300
74,969,118
40,313,212
19,925,711
60,238,923
-
5,000,000
5,000,000
5,039,019
4,878,254
80,008,137
70,117,177
(211,193)
(5,039,019)
(740,394)
(4,878,254)
74,757,925
64,498,529
Trade receivables - bills receivable:
Current operations
Trade receivables - doubtfull accounts:
Effect of discouting trade receivables
Accumulated impairment losses (Note 22)
30.06.2014
As of 30 June 2014 and 2013 the balance of the current and non-current caption “Trade receivables Transactions of players' registrations” includes, essentially, the following receivables:
Entity
Atlético de Madrid
Real Madrid
Al Hilal
Manchester City
Doyen Sports Investments Limited
Fluminense FC
São Paulo
Kasimpasa
Gol Football Luxembourg
Valencia CF
Zenit St Petersburg
Olympique Lyon
Chelsea FC
Outros
jun/15
Current
35,000,000
9,356,500
5,500,000
2,719,255
2,500,000
2,125,000
2,000,000
529,000
375,000
459,062
60,563,817
jun/14
Non current
12,000,000
2,500,000
14,500,000
Current
3,875,803
7,500,000
2,125,000
1,058,000
11,000,000
10,000,000
1,661,788
1,500,000
1,592,622
40,313,212
Non current
-
On June 30, 2015, the accounts receivable of the above entities resulted essentially from the sale of
the economic rights of players Jackson Martinez, Danilo, Fernando, Brahimi, Walter, Celestin Djinn,
Carlos Eduardo and Souza.
The balance of the caption ‘Trade receivables - Current Accounts - Current operations’ includes
balances resulting from several operations, with emphasis on the account receivables of:
(i)
Futebol Clube do Porto (“Clube”) (7,412,444 Euro as of June 30, 2015 and 5,736,126 Euros
as of June 30, 2014);
(ii)
Euroantas, Promoção e Gestão de Empreendimentos Imobiliários S.A. ("Euroantas")
(7,102,589 Euros on June 30, 2014).
___________________________________________________________________________________________
64
2014/2015
___________________________________________________________________________________________
The caption ‘Trade receivables – bills receivable’ includes bills not due at the end of the reporting
period, part of which were discounted (Note 18). As of 30 June 2014, these bills are related to accounts
receivable resulting from the sale of television broadcasting rights.
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 statement of financial position 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, reflects their fair value.
As of 30 June 2015 there are no indications 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 2015 and 2014 the ageing of trade receivables are as follows:
Due date
30.06.2015
Trade receivables - current accounts:
Current operations
Trade receivables - doubtfull accounts:
Total
- 90 dias
90 - 180 dias
180 - 360 dias
+ 360 dias
74,969,118
60,563,818
14,405,300
64,663,490
57,809,818
6,853,672
1,147,664
60,000
1,087,664
2,281,532
2,205,000
76,532
6,876,432
489,000
6,387,432
5,039,019
-
-
-
5,039,019
80,008,137
64,663,490
1,147,664
2,281,532 11,915,451
Due date
30.06.2014
Total
- 90 days
90 - 180 days
180 - 360 days
+ 360 days
Trade receivables - current accounts
Current operations
60,238,923
40,313,212
19,925,711
42,862,552
38,342,945
4,519,607
1,689,711
1,689,711
5,928,599
5,928,599
9,758,061
1,970,267
7,787,794
Trade receivables - bills receivable
Trade receivables - doubtfull accounts
5,000,000
4,878,254
5,000,000
-
-
129,777
4,748,477
70,117,177
47,862,552
1,689,711
6,058,376
14,506,538
As of June 30, 2015 and 2014 almost of the balance of "Trade receivables - current accounts Transactions of players’ registrations” with seniority over 180 days refers to contractually defined
amounts. There are no cases of significant settlement delays.
As of June 30, 2015 and 2014 a significant portion of the balance of "Trade receivables - current
accounts - Current operations" with seniority over 180 days refers to the accounts receivables from FC
Porto.
As of June 30, 2015 and 2014 the balance of "Doubtful Accounts receivable" includes, mainly,
receivables from football clubs, such as União Desportiva de Leiria, Futebol, Futebol SAD, Club Atlético
Independiente and Esporte Clube Vitória.
In determining the recoverability of accounts receivable the Group considers all the changes in credit
quality of counterparties from the date the granting of credit by the reporting date of the consolidated
financial statements. The Group has no significant concentration of credit risk, since the risk is diluted
by a scattered set of customers. Management believes that credit risk does not exceed the impairment
loss recorded for doubtful debts and that the maximum exposure to credit risk corresponds to the total
number of costumers shown in the consolidated statement of financial position.
___________________________________________________________________________________________
65
2014/2015
___________________________________________________________________________________________
12. INVENTORIES
The detail of the caption ‘Inventories’ as of 30 June 2015 and 2014 is as follows:
30.06.2015
Inventories
Accumulated impairment losses on inventories (Note 22)
30.06.2014
2,789,761
1,974,275
(609,451)
(377,293)
2,180,310
1,596,982
The inventories’ caption, as of 30 June 2015 and 2014, considers the merchandise related with the
exploration of the commercial areas of Futebol Clube do Porto, carried out by the subsidiary
PortoComercial.
The cost of sales, for the years ended 30 June 2015 and 2014 was calculated as follows:
30.06.2015
Opening balance
Purchases
Closing balance
Impairment losses (Note 22)
30.06.2014
1,974,275
3,238,220
2,789,761
2,422,734
232,158
2,654,892
1,415,250
3,091,357
1,974,275
2,532,332
74,597
2,606,929
13. OTHER CURRENT AND NON-CURRENT ASSETS
Other non-current assets
The detail of caption "Other non-current assets" as of 30 June 2015 and 2014 is as follows:
30.06.2015
Prepayment - "Estádio do Dragão" rent
Prepayment - Museum exploitation
Prepayment - "Centro de Treinos do Olival" rent
Deferred expenses - contract loans of players
7,875,000
216,867
8,091,867
30.06.2014
14,963,937
9,375,000
253,012
100,000
24,691,949
During the year ended June 30, 2014 was signed between PortoComercial and the Futebol Clube do
Porto a contract for the exploitation of the FCP Museum (which opening to the public occurred in
October 2013). Under this contract PortoComercial acquired the right to explore the museum during
a period of 8 years and paid in advance the amount of 12 million Euro relating to outstanding rents.
On June 30, 2015 the caption “Other non-current assets - Museum exploitation” correspond to the
rents for the year 2016/17 and following.
The change in the caption "Prepayment - "Estádio do Dragão" rent" is justified by the fact that
Euroantas have been included in the consolidation perimeter in the year ended June 30, 2015 and thus
___________________________________________________________________________________________
66
2014/2015
___________________________________________________________________________________________
the respective outstanding amount, which corresponds to the "Estádio do Dragão" utilization prepaid
rent for 2015/16 and subsequent years, was annulled on the consolidation process.
The detail of caption "Other current assets" as of 30 June 2015 and 2014 is as follows:
30.06.2015
State and public sector
Other debtors
Accrual income
Champions league participation bonus (Note 2.3 l) iv) to be received
Protocol for services rendered - FCP
Interests receivable from group companies
Advirtising revenue to be billed
Insurance claims
Bonus for FC Porto, SAD players participation in the
Football World Cup 2014 to receive
Other accrual income
Deferred expenses
Advances for expenses relating to the next season
Prepayment - Museum exploitation
Insurance
Other deferred expenses
30.06.2014
3,744,503
3,547,165
7,291,668
4,778,499
2,594,626
7,373,125
12,000,000
1,500,000
-
2,100,000
393,845
472,044
381,600
151,885
555,572
137,378
1,619,545
1,500,000
251,789
256,318
17,279,537
1,800,571
1,500,000
303,945
53,143
7,698,098
24,571,205
15,071,223
On June 30, 2015 and 2014 the amount recorded in "Other debtors" includes advances made to
athletes 1,428,279 Euro and 1,140,527 Euro, respectively.
As of June 30, 2015 and 2014 the caption "Advances for expenses relating to the next season" includes
essentially deferred expenses related to scouting contracts (223,744 Euro on June 30, 2015 and
940,260 Euro on 30 June 2014), deferred costs with players’ loans and intermediation costs from
technical staff hiring (1,277,213 Euro on June 30, 2015 and 808,200 Euro on June 30, 2014) and sports
equipment.
14. CASH AND CASH EQUIVALENTS
The caption ‘Cash and cash equivalents’ as of 30 June 2015 and 2014 is made up as follows:
30.06.2015
Cash
Bank deposits repayable on demand
Treasury applications
30.06.2014
23,727
17,951,996
265,000
4,550
14,695,889
265,000
18,240,722
14,965,439
___________________________________________________________________________________________
67
2014/2015
___________________________________________________________________________________________
As of 30 June 2015 and 2014 the amounts recorded in the caption “Treasury applications” refer
to bank deposits repayable in less than three months and bear market interest rates.
Other financial assets – current
A of June 30, 2015 and 2014, the caption "Other financial assets" in the amount of 6,826,271 Euro
refers to the cash with restricted utilization allocated to reserves for debt payment (4,529,224
Euro on June 30, 2015) and for other operating and maintenance costs of the “Estádio do Dragão”
(2,297,047 Euro on June 30, 2015), as described in Note 18 of this notes to the consolidated
financial statements.
15. TAXES
The tax losses carried forward according to the income declarations presented by the companies
included in the consolidation perimeter amounted to 92,100,660 Euro and mature as follows:
Amount
Generated in the year ended:
30 June 2010
30 June 2012
30 June 2013
30 June 2014
30 June 2015
12,633,841
39,783,989
1,190,982
38,434,907
56,941
92,100,660
Expiry date
30 June 2016
30 June 2016
30 June 2018
30 June 2019
30 June 2027
Current taxes
Following is the reconciliation between profit before income tax and income tax for the year:
___________________________________________________________________________________________
68
2014/2015
___________________________________________________________________________________________
30.06.2015
Profit before income tax
Increases:
Non tax deductible amortisation, depreciation and impairment of assets
depreciable or amortizable
Non tax deductible provisions
(1)
Fiscal gains
(1)
Accounting losses
(3)
Non tax deductible financing costs
Post-employment benefit
Adjustments not deductible or beyond the legal limits
Others
Decreases:
(1)
Accounting gains
Distributed dividends from subsidiaries
Reversal of tax deductible adjustments
Contributions
Utilization of non tax deductible provision
Others
20,558,484
1,756,485
60,053,122
792,195
1,166,675
30.06.2014
(37,487,992)
2,856,537
11,499,919
6,499,883
260,494
489,018
(82,648,005)
(231,449)
(602,808)
(64,508)
(355,501)
(12,865)
(22,296,904)
(84,063)
411,825
(38,263,108)
Tax losses utilized
(903,218)
(254,062)
Tax base
(491,393)
(38,517,170)
23.0%
1.5%
602,525
48,709
714,689
25.0%
1.5%
22,710
10,902
487,696
(721,593)
(42,504)
(1,035)
2,713,591
213
(15,185)
600,791
3,219,927
Taxable profit
Income tax rate
Municipal tax rate
Calculated tax
(2)
Municipality tax
Autonomous taxation
Payments under the RERD
Estimated income tax excess/(insufficiency)
Gains /losses RETGS
Deferred taxes
Others
Income tax for the year
(1) In the calculation of the taxable profit, the Group chose to consider the reinvestment of capital
gains on the sale of players registrations', in legal terms, which allowed to deduct 50% of tax capital
gains generated in the year.
(2) Municipality tax of companies taxed according to RETGS and which present taxable profit for the
year.
(3) Limitation on the deductibility of financing costs in accordance with Article 67 of the Corporate
Income Tax – CIT (Tax Code of Legal Persons)
Under the Extraordinary Regime for the Settlement of Debts to Social Security and to Tax Authority
("RERD") granted by the Ministry of Finance to the voluntary payments made by taxpayers until
December 31, 2013, regarding taxes due, the FC Porto SAD paid the amount of 4,227,685 Euro related
to tax processes, using the provision recorded for this purpose in the amount of 1,514,094 Euro (Note
22), recognizing the remaining difference as an expense for the year, in the amount of 2,713,591 Euro.
___________________________________________________________________________________________
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___________________________________________________________________________________________
Notwithstanding the settlement of this amount, the Company maintains the complaints and judicial
claims, having the Company contingent assets related with them as detailed in Note 34.
Deferred taxes
The changes in the caption "Deferred tax liabilities" in the year ended June 30, 2015, can be
summarized as follows:
30.06.2015
Opening balance
Diference between the fair value
and the tax value of the Stadium (Note 6)
Changes during the year
Impact on the net profit
Closing balance
2,252,722
(42,504)
2,210,218
16. CAPITAL
On June 30, 2015, the share capital of FC Porto, SAD was fully subscribed and paid up and consisted of
22,500,000 nominative shares of 5 Euros each, 15,000,000 ordinary shares and 7,500,000 preference
shares.
Preference shares are non-voting shares, entitled to priority dividend, which will be entitled to vote if
no dividend will be paid in two consecutive years.
However, FC Porto, SAD approved, in the same Shareholder’s General Meeting where it was approved
the share capital increase, the adoption of a maximum percentage of voting rights to be exercised by
each shareholder in the case that the preferred shares without voting rights may acquire this right in
future. Thus, if this happens - preference shares acquire voting rights, and over the period of time in
which it is inherent this right, there will not be considered the votes by a shareholder, in his own name
or in representation of another, exceeding more than one-third of the total votes corresponding to the
share capital.
On June 30, 2015, the following entities held share in the subscribed capital of at least 20% of the
ordinary shares with voting rights:
- FC Porto - 61.89% (corresponding to an imputable percentage of 63.71% attributable). This
percentage amounts to 74.59% in the case of considering the ordinary shares and the preferred shares
without voting rights.
On 2 October 2014, Futebol Clube do Porto acquired 2,818,185 ordinary shares, representing 18.79%
of the voting rights, from the companies Somague Imobiliária, SA and Somague. - Engenharia, SA. As a
result of this transaction, to Futebol Clube do Porto has become attributable more than 50% of the
voting rights in the Company at the club was forced to launch a takeover bid on the shares on offer.
From the conclusion of this process Futebol Clube do Porto acquired an additional 464,746 shares,
corresponding to 3.1% of the voting rights.
For the year ended June 30, 2015, a capital increase of 37.5 million Euro was accomplished, through
cash contribution through private subscription by Futebol Club of the Port, of 7,500,000 preferred
shares without voting rights.
___________________________________________________________________________________________
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___________________________________________________________________________________________
The individual financial statements of the Company as of June 30, 2015 present a shareholder’s equity
less than half the share capital, whereby the provisions of Articles 35 and 171 of the Portuguese
Companies Code ("CSC") are applicable. As mentioned in the Director’s Report, the Board of Directors
of FC Porto, SAD considers that the improvement in the economic and financial results will continue in
the upcoming years, and it will comply with the provisions of that article.
With the goal to quickly fulfil this obligation, the Board of Directors has been analysing other solutions
that allow the reinforcement of shareholders’ equity as referred in the Board of Directors’ Report.
The Board of Directors besides planning to review this matter on the Shareholders’ General Meeting
held to approve the accounts for the year, it may also call upon an Extraordinary Shareholders’ General
Meeting to discuss and approve the proposals that would be presented, which can include the
following alternatives:
• Share 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.
According to Article 171 of the Portuguese Commercial Code (Código das Sociedades Comerciais), a
company which shareholders’ equity is less than half of its share capital, should indicate the share
capital, the amount of share capital paid and the amount of shareholders’ equity according to the last
approved statement of financial position in all contracts, mail, publications, ads, websites, and in
overall external activity.
17. NON-CONTROLLING INTERESTS
The changes in this caption during the years ended 30 June 2015 and 2014 were as follows:
Net consolidated profit for the year attributable to non-controlling interests
(186,224)
(6,804)
13,220
(179,808)
Net consolidated profit for the year attributable to non-controlling interests
Distribution of dividends
Other changes
(179,808)
605,869
(25,716)
58,363,431
(1)
58,763,775
18. BANK LOANS AND BONDS
The captions ‘Bank loans’ and ‘Bonds’ as of 30 June 2015 and 2014 are made up as follows:
___________________________________________________________________________________________
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2014/2015
___________________________________________________________________________________________
Nature
Bank loans
Factoring
Discounted bills (Note 11)
30.06.2015
Amortised cost
Nominal value
Current
Non-current
Current
Non-current
34,979,147
16,475,435
10,000,000
61,454,581
23,879,350
12,408,767
36,288,117
35,141,831
16,500,000
10,000,000
61,641,831
23,879,350
12,408,767
36,288,117
-
63,711,415
-
65,000,000
61,454,581
99,999,532
61,641,831
101,288,117
Bonds
Nature
30.06.2014
Amortised cost
Nominal value
Current
Non-current
Current
Non-current
Bank loans
Credit on current accounts
Factoring
Discounted bills (Note 11)
41,283,012
10,000,000
14,757,769
5,000,000
71,040,781
16,112,500
3,000,000
19,112,500
40,100,000
10,000,000
14,877,500
5,000,000
69,977,500
16,112,500
3,000,000
19,112,500
Bonds
29,591,657
19,395,933
30,000,000
20,000,000
100,632,438
38,508,433
99,977,500
39,112,500
As of 30 June 2015 the repayment schedule of the nominal value of non-current loans may be
summarised as follows:
30.06.2015
2016/2017
2017/2018
2018/2019
41,627,629
57,366,361
2,294,127
101,288,117
The detail of loans classified as liabilities at June 30, 2015 is as follows:
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___________________________________________________________________________________________
Bank
Current
Non-current
Total
Open date
Interest rate
Instalments
interest
Maturity date
Guarantee / collateral
Bond loan 2015-2018
Bond loan 2014-2017
-
45,000,000
20,000,000
45,000,000
20,000,000
May-15
Jun-14
5.00%
6.75%
At nominal value at maturity
Semi-annual
Semi-annual
May-18
Jun-17
-
NOVO BANCO
3,000,000
11,000,000
14,000,000
Aug-10
Euribor 12M +
spread
Annual
Sep-18
Revenue for the season tickets, ticket and membership fees
until the season 2017/18
NOVO BANCO
875,000
-
875,000
Jan-14
Tax credit pledge, Club's real estate assets mortgage
NOVO BANCO
25,000,000
-
25,000,000
Oct-13
Millennium BCP
825,000
412,500
1,237,500
Dec-13
Millennium BCP
1,250,000
1,250,000
2,500,000
May-99
Montepio Geral
390,000
1,110,000
1,500,000
Feb-15
Banking sindicate - BPI leader
bank
3,801,831
10,106,850
13,908,681
-
12,000,000
Loan issues
Bank loans
4 annual instalments in Sep-15 and
Sep-16 of 3,000,000 Euro each and in
Set-17 and Set-18 of 4,000,000 Euro
each.
3 semi-annual instalments of equal
amount
Euribor 6M +
spread
Euribor 3M +
spread
Euribor 6M +
spread
Euribor 1M +
spread
EUR 6M +
4,25%
Semi-annual
Jan-16
Quarterly
Sep-15
Herrera and Brahimi player's registrations (**)
11 quarterly instalments of equal value
Quarterly
Dec-16
Tax credit pledge, Club's real estate assets mortgage
Jul-03
12,000,000
Apr-15
8 quarterly instalments of equal value
Monthly
Jun-17
Helton player's registrations
4 capital depreciations
In arrears
Aug-17
Coca-Cola sponsorship contract
(*)
28 semi-annual instalments
Semi-annual
Sep-18
(*)
5.00%
receiving of the 3rd instalment of
Danilo's sale to Real Madrid
Anticipated
Jul-16
"Factoring"
Internationales Bankhaus
Bodensee AG
Bodensee AG
Amounts to be received by Real Madrid form the sale of
Danilo's player's registration
Amounts to be received for the UCL 15/16 group's stage
qualification
12,000,000
-
12,000,000
May-15
4.00%
On the dates of receipt of the UEFA
Anticipated
Oct-15
BIC
1,560,000
-
1,560,000
Apr-14
Euribor 6M +
spread
At face value at maturity
Anticipated
Feb-16
Unicer sponsorship contract
Bodensee AG
1,500,000
408,767
1,908,767
Jan-15
3.00%
On the dates of receipt of the Warrior
Anticipated
Nov-16
Warrior sponsorship contract
BIC
1,440,000
-
1,440,000
Apr-14
Euribor 3M +
spread
Anticipated
Feb-16
Unicer sponsorship contract
5,000,000
5,000,000
-
5,000,000
5,000,000
Jul-14
Dec-14
6.32%
5.08%
Anticipated
Anticipated
Sep-15
Jan-16
Amounts to be received from PPTV
Amounts to be received from PPTV
61,641,831
101,288,117
162,929,948
Bills discounted
NOVO BANCO
Montepio Geral
(*) Funding for the construction of the "Estádio do Dragão"
(**) Loan were renegotiated in the beginning of the season 2015/16, being reimbursed 8.000.000 Euro in Jul-15 and Sep-15, and the extension of the maturity of the remaining amount to September 2016.
On July 8, 2003 a long-term loan agreement amounting to 40 million Euro between Euroantas, the FC
Porto and five financial institutions (with the BPI bank as the leader) was signed, in order to finance
the “Estádio do Dragão” construction project. The repayment of the loan is to be paid in 28 semiannual installments, with the first one on March 31, 2005 and the last one shall become due on
September 28, 2018.
The obtained financing bears market interest rates. Under Decree-Law No 284/2001, the Group
benefits from an interest subsidy over the amount of 25,289,053 Euro of the total loan obtained. As of
June 30, 2015 the subsidized loan tranche still owed amounts to 6,322,263 Euro. However, following
the publication of Decree-Law No. 166/2004, of 7 July, which revoked the no. 3 of the Article 2 of
Decree-Law No. 284/2001 of 26 October and, in conjunction with the approved Regulation by
Ordinance No. 535/2002, of 27 May, and given the provisions of No. 5 of Article 2 of Decree No.
284/2001, Euroantas is entitled to 10 years of interest subsidy (as the term financing is higher) counted
from the contract award date, so that the concession ended for the year ended June 30, 2014.
Thus, the loan bears interest as follows:
• Not subsidized installments: Interest rate: 4.53125% + Spread;
• Subsidized installments: Interest rate: Euribor 6M + Spread (with a SWA" to fixed rate of 4.26%).
Under this financing agreement, in addition to the voluntary mortgage, made payable to those
financial institutions, Euroantas and FC Porto assume certain obligations, from which highlight:
Euroantas
(i) Prohibition of sell of transfer of its assets (land and buildings), in the present or in the future;
(ii) Non-encumbrance or lien pledge of its assets, in the present or in the future;
(iii) Failure to contract additional bank loans with other financial institutions.
___________________________________________________________________________________________
73
2014/2015
___________________________________________________________________________________________
FC Porto
(i) Prohibition of sell or promise to sell, their Euroantas shares;
(ii) Prohibition to propose or vote, any changes to Euroantas’ statutes;
(iii) Prohibition to sell, or promise to sell, any shares of Futebol Clube do Porto - Futebol, SAD without
the prior agreement of the financial institutions which provided the funding.
Also as part of this financing agreement, Euroantas assumes the obligation of, in each year, fully endow
a reserve fund for the corresponding debt service to one year's debt service (amount equivalent to the
repayment of principal and charges with interest thereon, not considering the amount related to the
aforementioned interest rate subsidies), which on June 30, 2015 amounts to approximately 4,529,224
Euro (4,423,321 Euro to June 30, 2014) (Note 14).
The average annual rate on bank loans and bonds as of 30 June 2015 is 5.57%.
19. OTHER CREDITORS
As of 30 June 2015 and 2014, the caption “Other creditors” is as follows:
Entity
Pearl Design
Doyen Sports Investments Ltd.
Good for Sport Ltd.
For Gool
Interests
30.06.2015
30.06.2014
2,125,000
1,200,000
5,000,000
2,125,000
5,000,000
1,500,000
-
8,325,000
8,625,000
2,764,200
1,402,940
11,089,200
10,027,940
In the financial year ended 30 June 2011, the Company entered into associated financial interests
contracts with third parties, in order to transfer of 25% of Walter economic rights’ by 2,125,000 Euro
to Pearl Design Holding, Ltd.. Once that, according to the referred contracts, the significant risks and
benefits regarding to the detention of those rights were not fully transferred, those transactions were
not recorded as sales, and therefore, the part of the economic rights of that intangible assets was not
derecognised. The amounts received from those entities were recorded in the caption of the
statement of financial position “Other creditors”.
On December 14, 2011, the Group entered, with Doyen Sports Investments Limited, into two
associated financial interests’ contracts in order to transfer part of the economic rights of the players
Defour and Mangala amounting 2,352,941 Euro and 2,647,059 Euro, respectively, which were settled
during the year ended as of 30 June 2015 as a result of the sale of sporting registration rights of these
players (Note 8).
On July 23, 2014, the Group entered, with Doyen Sports Investments Limited, into an associated
financial interests’ contracts in order to transfer part of the economic rights of the player Brahimi
player in the amount of 5,000,000 Euro. This agreement foresees call options by FCP, SAD up to 55%
of the economic rights until June 2017, and put options of up to 80% of the economic rights by Doyen
___________________________________________________________________________________________
74
2014/2015
___________________________________________________________________________________________
until September 2017. Once that, according to the referred contracts, the significant risks and benefits
regarding to the detention of those rights were not fully transferred, those transactions were not
recorded as sales, and therefore, the part of the economic rights of that intangible assets was not
derecognised. As of the year ended June 30, 2015 the Company exercised two call options
corresponding to 30% of the economic rights of the player for 3.8 million Euro, having this amount
been deducted from the corresponding liability.
Thus, the percentages held of the players, referred to in Note 8, take in consideration the sharing with
those entities of the inherent results in future transactions of the players Walter and Brahimi.
On February 24, 2015, it was obtained a financing of 5,000,000 Euro from For Gool Co Ltd reimbursable
until September 30, 2015.
20. TRADE PAYABLES
Non-current liabilities
The detail and maturity of non-current trade payables balances as of 30 June 2015 and 2014 is as
follows:
30.06.2015
Trade payables - non-current
Tangible and intangible assets' suppliers:
Effect of discounting trade payables
> 1 YEAR
6,000,000
6,000,000
-
-
-
-
(364,505)
(364,505)
-
-
-
-
5,635,495
5,635,495
30.06.2014
Trade payables - non-current
Tangible and intangible assets' supliers:
Other tangible and intangible assets' supliers
> 2 YEARS > 3 YEARS > 4 YEARS > 5 YEARS
> 1 YEAR
-
-
-
-
987,333
51,364
987,333
38,523
12,841
-
-
-
(32,442)
(32,442)
-
-
-
-
1,006,255
993,414
12,841
-
-
-
The balance of the non-current trade payable account “Suppliers – transactions of players’
registrations” as at 30 June, 2015, is due to: (i) the acquisition of economic and sporting rights of
Brahimi in the amount of 5,500,000 Euro; and (ii) the acquisition of economic and sporting rights of
Gudiño in the amount of 500,000 Euro.
The balance of the non-current trade payable account “Suppliers – transactions of players’
registrations” as at 30 June, 2014, is due, essentially, to the acquisition of sporting and economic rights
of the player Lichnovsky, in the amount of 612,333 Euro.
___________________________________________________________________________________________
75
2014/2015
___________________________________________________________________________________________
Current liabilities
As of 30 June 2015 and 2014, the balances of current trade payables and their eligibility may be
detailed as follows:
30.06.2015
Trade payables - current account
Tangible and intangible assets' suppliers:
- 90 days
9,402,719
-
-
36,855,915
36,855,915
13,528,265
13,528,265
3,257,500
3,257,500
20,070,150
20,070,150
(125,830)
30.06.2014
+ 180 days
9,402,719
(46,187)
46,132,804
Trade payables - current account
Tangible and intangible assets' supliers:
Obligations under finance leases
Payable to
90 - 180 days
(11,121)
22,884,797
- 90 days
(68,522)
3,246,379
20,001,628
Payable to
90 - 180 days
+ 180 days
11,544,496
11,544,496
-
-
24,534,256
38,524
24,572,780
22,569,104
9,631
22,578,735
51,409
9,631
61,040
1,913,743
19,262
1,933,005
(270,740)
35,846,536
(156,623)
33,966,608
(45,292)
(68,825)
15,748
1,864,180
As of 30 June 2015 and 2014 the main balances included in the captions, current and non-current,
‘Fixed assets’ suppliers – Transactions of players’ registrations’ can be detailed as follows:
Entity
Club Atlético de Madrid SAD
Feyenoord Rotterdam NV
Danubio Finanzierungsleistungen und Marketing GMBH
Coimbra Esporte Clube
Vitoria Sport Clube - Futebol SAD
Delfino Pescara
Onsoccer International, S.A.
Santos FC
Pencilhill
Chivas Corazón
Universidade do Chile
Gol Football Luxembourg
Estoril - SAD
Gestifute, S.A.
Granada Club de Futbol SAD
Promotora del Club Pachuca SA de CV
Moreirense Futebol Clube, SAD
MHD, S.A.
MS Entertainmnet Law-Melanie Schärrer
Soccer Invest Fund
DNN Lda.
Cluj
River Lane Youyh Club
Others
jun/15
Current
11,000,000
3,720,000
2,676,000
2,500,000
2,300,000
2,250,000
2,000,000
1,718,500
1,618,223
1,500,000
924,667
800,000
705,000
600,150
500,000
150,000
1,893,376
36,855,915
jun/14
Non-current
500,000
5,500,000
6,000,000
Current
2,065,000
1,110,800
2,500,000
5,400,000
1,224,667
2,000,000
207,500
134,000
2,000,000
1,675,000
586,874
586,874
550,000
500,000
380,000
3,613,541
24,534,256
Non-current
612,333
375,000
987,333
___________________________________________________________________________________________
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2014/2015
___________________________________________________________________________________________
On June 30, 2015, the balances payable to the entities mentioned above have resulted mainly from
the acquisition of economic rights, the proportional sale values of the registration player’s held by third
parties and intermediation service costs provided in acquisition and disposals of players’ registrations
regarding the athletes Adrian Lopez, Brahimi, Martins Indi, Celestin Djim, Kayembe, Otavio, Hernani,
Quintero and Fernando, among others.
21. OTHER CURRENT AND NON-CURRENT LIABILITIES
The captions ‘Other non-current liabilities’ and ‘Other current liabilities’ as of 30 June 2015 and 2014
can be detailed as follows:
30.06.2015
Other non-current liabilities
Accrued expenses:
Cost of transactions of players' registrations, not yet due
Deferred income:
Broadcasting rights advances/anticipated invoicing
(Note 30)
Deferred revenue sponsorship - BMG Museum
30.06.2014
6,166,478
1,852,280
4,000,000
6,000,000
5,957,167
(159,909)
5,046,639
(136,297)
15,963,736
12,762,622
2,638,865
8,557,715
11,196,580
3,127,033
5,000,000
9,902,184
18,029,217
780,856
10,967,739
3,338,422
3,658,014
18,745,031
767,371
7,839,508
2,071,921
519,099
11,197,899
2,000,000
98,688
695,576
645,920
3,440,184
2,000,000
328,613
1,825,000
651,679
221,509
5,026,801
(597,370)
(434,242)
32,784,425
33,819,675
Advances to clients
Other creditors
Accrued expenses:
Accrued payroll
Competition bonuses pending processing
Other accrued expenses
Deferred income:
Broadcasting rights advances/anticipated invoicing (Note 30)
Sale of season tickets
Advertising
Other deferred income
The caption ‘Other current/non-current liabilities – Cost of transactions of players' registrations, not
yet due’ includes commitments assumed in players registrations transactions supported by the
respective contracts and not yet invoiced as of the end of the reporting period.
As of 30 June 2015, includes, namely, amounts related to:
___________________________________________________________________________________________
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2014/2015
___________________________________________________________________________________________
(a)
The costs of intermediation services of players totaling 14,683,295 Euros relating, among others,
the sale of Jackson Martinez and Iturbe player’s registration and the exercise price of the call
options to purchase a percentage of the economic rights of Brahimi (Note 19).
(b)
Celebration and/or renewal of the labour contracts, namely signing-on fees in the amount of
1,670,893 Euro related, among others, to the players Andrés Fernandez and Walter.
As of 30 June 2014, includes, namely, amounts related to:
(a) intermediation costs of players in the amount of 5,583,452 Euro related, to among others, with
the sale of registration rights of the players Iturbe, Fernando and Otamendi;
(b) celebration and/or renewal of the labour contracts, namely signing-on fees and image rights in the
amount of 3,417,565 Euro related, among others, to the players Reyes and Diego Herrera.
In the classification as non-current balance, which regards the signing-on fees, were considered the
agreed payment dates.
The item "Other payables" as of June 30, 2015, includes remunerations, bonuses and termination
compensations payable to players who have terms of payment in the short term (approximately
6,115,000 Euro as of June 30, 2015 and 7,567,000 Euro as of June 30, 2014).
On June 30, 2015 and 2014, the caption "Competition bonuses pending processing" includes amounts
relating to matches participation premiums and amounts and bonuses attributed to certain athletes in
order to guarantee the minimum annual wage contracted in their respective labour contract.
The caption "Deferred Revenue Sponsorship - BMG Museum" refers to the deferral of revenue related
to the agreement signed between the subsidiary PortoComercial and Banco de Minas Gerais (“BMG”)
as an advance under the signature of a partnership agreement concerning advertising and support of
the construction of the FC Porto Museum. This contract establishes the sponsorship and naming of the
Museum in the amount of 8,000,000 Euro until 2025. As mentioned in Note 13, PortoComercial
acquired, in October 2013, to Futebol Clube do Porto the right to explore the Museum, having paid in
advance 12,000,000 Euro, corresponding to the rents of 8 years of the Museum exploration.
The maturity of the captions ‘Other non-current liabilities’ and ‘Other current liabilities’ as of 30 June
2015 and 2014 can be detailed as follows:
30.06.2015
Accrued expenses:
Deferred income:
Broadcasting rights advances/anticipated invoicing
(Note 30)
> 1 YEAR
6,166,478
5,746,478
420,000
-
-
-
4,000,000
2,000,000
2,000,000
-
-
-
5,957,167
(159,909)
695,576
(149,017)
695,576
(10,892)
695,576
-
695,576
-
3,174,863
-
15,963,736
8,293,037
3,104,684
695,576
695,576
3,174,863
___________________________________________________________________________________________
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2014/2015
___________________________________________________________________________________________
30.06.2015
90-180
DAYS
< 90 DAYS
180-360
DAYS
Other creditors
Accrued expenses:
Accrued payroll
Deferred income:
Broadcasting rights advances/anticipated invoicing (Note 30)
30.06.2014
Accrued expenses:
Deferred income:
Broadcasting rights advances/
antecipated invoicing (Note 30)
2,638,865
8,557,715
11,196,580
2,638,865
8,557,715
11,196,580
-
-
780,856
10,967,739
3,338,422
3,658,014
18,745,031
8,857,017
3,338,422
3,658,014
15,853,453
260,285
1,201,611
1,461,896
520,571
909,111
1,429,682
2,000,000
98,688
695,576
645,920
3,440,184
500,000
98,688
173,894
645,920
1,418,502
500,000
173,894
673,894
1,000,000
347,788
1,347,788
(597,370)
(420,901)
(22,875)
(153,594)
32,784,425
28,047,634
2,112,915
2,623,876
> 1 Year
Accrued expenses:
Accrued payroll
Deferred income:
Broadcasting rights advances/
antecipated invoicing (Note 30)
Advertising
> 3 years
> 4 years
1,852,280
1,120,352
453,464
278,464
> 5 years
-
-
6,000,000
2,000,000
2,000,000
2,000,000
-
-
5,046,639
(136,297)
651,679
(82,439)
651,679
(33,367)
651,679
(20,490)
651,679
-
2,439,923
-
12,762,622
3,689,592
3,071,776
2,909,653
651,679
2,439,923
30.06.2014
Advances to clients
Other creditors
> 2 years
< 90 days
90-180
days
180-360
days
3,127,033
5,000,000
9,902,184
18,029,217
3,127,033
9,902,184
13,029,217
-
5,000,000
5,000,000
767,371
7,839,508
2,071,921
519,099
11,197,899
6,887,175
2,071,921
519,099
9,478,195
255,790
612,333
868,123
511,581
340,000
851,581
2,000,000
328,613
1,825,000
651,679
221,509
5,026,801
500,000
82,153
912,500
162,919
221,509
1,879,081
500,000
82,153
912,500
162,290
1,656,943
1,000,000
164,307
326,470
1,490,777
(434,242)
(452,817)
(2,725)
(23,960)
33,819,675
23,933,677
2,522,341
7,318,397
___________________________________________________________________________________________
79
2014/2015
___________________________________________________________________________________________
22. PROVISIONS AND ACCUMULATED IMPAIRMENT LOSSES
The movement in provisions and accumulated impairment losses in the years ended 30 June 2015 and
2014 is as follows:
Captions
Accumulated impairment loss on investments (Note 9)
Accumulated impairment loss on account receivables (Note 11)
Accumulated impairment loss on inventories (Note 12)
Provisions
Captions
Accumulated impairment loss on investments (Note 9)
Accumulated impairment loss on account receivables (Note 11)
Accumulated impairment loss on inventories (Note 12)
Provisions
Opening
Balance
30.06.2014
Changes of
the perimeter
Increase
Utilization
Decrease
Closing
balance
30.06.2015
1,202,037
4,878,255
377,293
410,555
60,963
-
432,114
1,429,549
232,158
-
(1,610,892)
(943,189)
-
(386,559)
(410,555)
23,259
5,039,019
609,451
-
6,868,140
60,963
2,093,821
(2,554,081)
(797,114)
5,671,729
Opening
balance
30.06.2013
Changes of
the perimeter
Increase
1,705,267
5,042,712
302,696
1,924,649
-
1,532,169
322,016
74,597
-
8,975,324
-
1,928,782
Utilization
(78,184)
Decrease
Closing
balance
30.06.2014
(1,514,094)
(2,035,399)
(408,289)
-
1,202,037
4,878,255
377,293
410,555
(1,592,278)
(2,443,688)
6,868,140
Provisions
Tax litigations
As of June 30, 2013 the Group presented provisions in the amount of 1,514,094 Euro to cover any
contingencies that might arise from an unfavourable outcome of tax litigations, which had been
challenged through complaints/administrative appeals or judicial challenges by the Group, by the fact
that the Board of Directors and theirs legal and tax advisors consider that the reasons given by the Tax
Administration on the matters referred, were not in accordance with Portuguese law.
However, under the Extraordinary Regime for the Settlement of Debts to Social Security and to Tax
Authority ("RERD") granted by the Ministry of Finance to the voluntary payments made by taxpayers
until December 31, 2013, regarding taxes due, the FC Porto SAD paid the amount of 4,227,685 Euro
related to tax processes, using the provision recorded for this purpose in the amount of 1,514,094
Euro, recognizing the remaining difference as an expense for the year Note 15). Notwithstanding the
settlement of this amount, the Company maintains the complaints and judicial claims, having the
Company contingent assets related with them as detailed in Note 34.
Currently, the Company does not have any tax assessments settlements’ pending from regularization,
by which no additional provisions were not registered in order to face tax contingencies.
Other litigations
During the year ended 30 June 2008 a judicial process was brought by a third party against the
subsidiary PortoEstádio; in May 2009 a sentence was issued by the the Judicial Court’s (7ª Vara Cível
do Tribunal Judicial do Porto) condemning PortoEstádio to pay a compensation of 404,241 Euro, plus
default interests, having the Group presented an appeal against this verdict. In July 2015 the outcome
of this process was known, a favorable decision for PortoEstádio by which the previously recorded
provision was reversed.
___________________________________________________________________________________________
80
2014/2015
___________________________________________________________________________________________
Bank guarantees
As of June 30, 2015, the Group had the following bank guarantees:
a) FC Porto SAD: active bank guarantee in the amount of 2,250,000 Euro in Banco Montepio Geral
regarding the acquisition of Quintero’s player’s registration to Pescara. The amount covered by
the guarantee was fully paid in July 2015, and the bank guarantee has been withdrew.
b) Porto Estádio: bank guarantee of 410,555 Euro regarding the judicial process described above,
having this warranty however been withdrew in the beginning of the season 2015/16 due to the
favourable decision to the Group;
c) PortoComercial: bank guarantees in the amount of 137,511 Euro in favour of malls store’s
leaseholders;;
d) PortoSeguro: bank guarantees of 15,000 Euro in favour of the “Instituto de Seguros de Portugal”
– “ISP”, the Portuguese Insurance Institute;
e) Dragon Tour: bank guarantee of 75,000 Euro in favour of IATA - International Air Transport
Association.
Other responsibilities
FC Porto, SAD endorsed a guarantee towards FCP Serviços Partilhados, S.A. in the amount of 503,574
Euro, under the financial leasing of computer equipment purchased by this entity of the Futebol Clube
do Porto Group.
23. PENSION LIABILITIES
The Group has committed to grant to certain employees cash contributions as retirement complement
plans. These benefits are set out in the Collective Agreement between FC Porto and CESP – “Sindicato
dos Trabalhadores do Comércio, Escritórios e Serviços de Portugal e Outros” (Trade Union for workers
of Commerce, Offices and Services of Portugal).
The most recent actuarial valuation of the plan and the present value of defined benefits obligation
was made in July 25, 2015 by Mercer (Portugal) Lda.. The present value of the defined benefit
obligation and the cost of the current services and past services were measured using Projected Unit
Credit method.
The main assumptions followed in the actuarial valuation referred above are as follows:
30.06.2015
Retirement normal age
Mortality table
Disability table
Discount rate
Inflation rate
Salaries increase rate
Pension increase rate
30.06.2014
66 years
66 years
TV 88/90
TV 88/90
EVK 80 at 50%
EVK 80 at 50%
2.25%
2.75%
2.00%
2.00%
3.00%
3.00%
2.00%
2.00%
Movements in the present value of the defined benefit obligation for the years ended June 30,
2015 and 2014 are described as follows:
___________________________________________________________________________________________
81
2014/2015
___________________________________________________________________________________________
30.06.2015
Opening Balance
Constitution
Interest Cost
(Gains) /actuarial losses
Closing Balance
30.06.2014
448,818
24,932
(138,526)
335,224
448,818
448,818
The major risks for which the pension plan may be exposed are as follow:
• Behaviour of demographic variables;
• Changes to occur in the Social Security system;
• Pension indexation.
A sensitivity analysis was performed in order to measure the impact on pension liabilities caused by
changes in the discount rate (increase of 50 basis points) and a negative impact of approximately
26,000 Euro was calculated.
24. SERVICE RENDERED
Services rendered for the years ended 30 June 2013 and 2012 are made up as follow:
30.06.2015
Sporting income
European competitions participating bonus
Ticketing income
Season tickets
Membership contributions
Other sporting income
Advertising
Broadcasting rights
Others
30.06.2014
36,169,711
4,269,628
2,690,530
918,144
1,176,611
45,224,624
9,551,956
2,493,309
2,835,578
899,123
2,400,405
18,180,371
13,564,684
17,251,214
8,200,550
4,269,462
88,510,534
13,594,159
15,928,072
14,352,830
4,922,761
66,978,193
The increase in revenues from " European competitions participating bonus" is justified by the fact
that: (i) the revenue for the UEFA Champions League 2014/15 Group’s stage, on the amount of 8.6
million Euro has been recorded in the year ended as of June 30, 2015 and not in season 2013/2014 by
the fact that the Company only won the right to participate in this stage this season, while the revenues
of the same nature relating to the homologous period have been recorded in the 2012/13 season, due
to the fact that the main team have won the access, in that same season, to the UEFA Champions
League 2013/14 Group’s stage, (ii) best sporting performance of when compared with the homologous
period in the UEFA Champions League, which already includes the revenue for the participation on the
quarter finals of that competition and (iii) revenue from the Champions’ League group stage of the
2015/16 season, amounting to 12 million Euro, since it has been assured with the second place in the
2014/15 National Championship.
___________________________________________________________________________________________
82
2014/2015
___________________________________________________________________________________________
The increase in the caption "Ticket income" is related to a higher number of matches in the European
competitions. The decrease in the caption "Season tickets" is related to a lower level of
commercialization of season tickets for the season 2014/15. The caption "Membership contributions”
correspond to the transfer of 25% of the total contributions charged by FC Porto.
Under the loan and cooperation agreement signed in July 2003 between PortoEstádio – Gestão e
Exploração de Equipamentos Desportivos, S.A. (“PortoEstádio”), FCPorto e Futebol Clube do Porto –
Futebol, S.A.D. (“FCP, SAD”), Euroantas holds the exclusive right to commercialize Boxes and Business
Seats ("Lugares Euroantas"). The reduction in this caption when compared with 2013/14 sporting
season is related to the inclusion, for the first time, of Euroantas in the Group's consolidation
perimeter, remaining under this caption, the net value, at Group level, of income related to the
commercialization of "Lugares Euroantas".
25. EXTERNAL SUPPLIES AND SERVICES
As of 30 June 2015 and 2014, the main balances included in this caption were as follows:
30.06.2015
Specialised services
Subcontracts
Rentals
Advertising
Security
Organization costs
Repair and maintenance
Insurance
Sports equipment
Fees
Cleaning up services
Representation expenses
Communication
Electricity
Fuels
Other costs
11,813,892
5,336,446
3,956,461
2,168,258
1,592,689
1,382,672
1,359,541
1,146,193
835,074
736,189
544,618
500,442
470,155
327,418
212,528
854,031
33,236,607
30.06.2014
10,865,542
4,902,667
3,817,848
1,672,386
1,370,372
1,295,064
536,159
1,016,266
617,127
787,335
515,000
488,439
392,237
370,819
427,793
12,261,707
711,255
42,048,016
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) costs with advisory services, namely the ones provided by FC Porto – Serviços Partilhados S.A.
(Note 31); (iv) costs relating to the cession of the exploitation and management rights of the TV
channel "Porto Canal" and to the alterations of the referred TV Channel grid, as agreed with the
company “Avenida dos Aliados de Comunicações, SA.”.
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,
___________________________________________________________________________________________
83
2014/2015
___________________________________________________________________________________________
as well as the utilization of the training centre by the senior team and the junior teams, as well
the costs of travel and accommodation incurred by the subsidiary Dragon Tour.
The caption "Organization costs" considers various costs associated with matches’ organization
and the balance of the caption “Travel expenses” includes, essentially, travel expenses performed
by the main football team in the national championship, in the European competitions and in preseason tournaments.
The absence of the caption "Corporate Hospitality" towards the season 2013/14 is related to the
inclusion for the first time, of Euroantas in the Group's consolidation perimeter.
The increase in the captions "Subcontracts", "Security" and "Organization costs” is related to the
increase in the number of matches, neamely in what refers to the European competitions. The
increase in the caption "Maintenance and repair" caption is related to extraordinary expenses of
the substitution of the “Estádio do Dragão’s”’ lawn.
26. PAYROLL EXPENSES
The balances related to payroll expenses for the years ended 30 June 2015 and 2014 of the Company
and subsidiaries are detailed as follows:
30.06.2015
Governing bodies
Players/Coaches
Technical and administrative staff
Post-Employment Benefits
Indemnities
Charges on salaries
Insurance
Other costs
1,827,494
54,120,242
4,891,902
24,035
473,169
4,627,194
2,316,993
1,717,537
69,998,566
30.06.2014
2,853,989
34,362,160
5,303,599
448,818
545,718
3,252,683
1,571,613
546,714
48,885,294
The increase in the captions "Players/Coaches", "Charges on salaries" and "Insurance" in the year
ended June 30, 2015 is justified mainly by the strong investment made in the squad, which led to a
significant increase in labour costs.
For the year ended June 30, 2015, compensation costs with players loaned out to other clubs
amounted to approximately 600,000 Euro (3,5 million Euro on June 30 2014) and the salaries costs for
players borrowed from other clubs amounted to approximately 6,1 million Euro.
The remuneration of the members of the Board of Directors of FC Porto, SAD and its subsidiaries for
the years ended June 30, 2015 and 2014 is as follows:
30.06.2015
Fixed Remuneration
30.06.2014
1,827,494
2,853,989
1,827,494
2,853,989
The detail of the remunerations for each Board of Directors’ member and remaining governing bodies
is disclosed in the Corporate Governance Report.
___________________________________________________________________________________________
84
2014/2015
___________________________________________________________________________________________
As of 30 June 2015 and 2014, the number of people working for the Group is as follows:
30.06.2015
30.06.2014
7
133
37
32
43
77
8
159
31
7
33
58
329
296
Governing bodies
Administrative staff
Technical staff
Museum
Vendors (stores)
Football players
27. RESULTS OF TRANSACTIONS WITH PLAYERS’ REGISTRATIONS
The results of transactions with players’ registrations in the years ended 30 June 2015 and 2014
can be detailed follows:
30.06.2015
Amortisation of players' sporting registration rights (Note 8)
Impairment losses of players' sporting registration rights (Note 8)
Elimination of player's passes
Income/(expenses) related with transactions of players' registrations
Costs relating to players on loan
Other costs relating to players
Gains from the sales of players' registrations (Note 8)
Income relating to players on loan
Other income relating to players
30.06.2014
30,227,292
1,146,645
31,373,937
26,379,179
563,333
188,192
27,130,704
(3,511,210)
(3,975,181)
(7,486,391)
(145,000)
(1,660,800)
(1,805,800)
86,470,297
1,017,500
2,499,025
89,986,822
22,397,504
1,483,937
1,831,215
25,712,656
82,500,431
23,906,857
51,126,494
(3,223,847)
Impairment losses of players’ registrations rights consider the carrying amount of players’ registrations
as of 30 June 2015 whose employment contracts were terminated by the Company until the approval
date of these financial statements, as well as the estimated impairment loss of the players’
registrations considering the players’ sport situation as of the approval date of the financial
statements. The balance of this caption as of 30 June 2015 corresponds essentially to the players
Djalma, Opare and Quiñones. On June 30, 2014 the balance of this caption corresponds mainly to the
players Izmailov and Stefanovic.
On June 30, 2015, the caption "Costs relating to players on loan" refers to expenses incurred under the
loan of the players Malthe Johansen, Roniel, Oliver, Pavlovski, Tello, Casimir, Ruiz, Campaña and
Gudiño.
___________________________________________________________________________________________
85
2014/2015
___________________________________________________________________________________________
For the year ended June 30, 2015, the caption "Other income relating to players" includes the solidarity
mechanism for the transfer of player James Rodriguez from AS Monaco to Real Madrid (1,069,000
Euro). The caption "Other costs relating to players", in the same period, includes (i) compensation
payable to the Clube Corinthians Alagoano arising from a dispute with this entity on the transfer of the
player Pepe, for which the two companies reached an agreement, that foresees a payment of
compensation in the amount of 1,650,000 Euro and (ii) adjustments to capital gains arising from
negotiation process completed during the year ended 30 June 2015 amounting to 1,300,000 Euro.
For the year ended June 30, 2014, the value of "Other income relating to players" includes the amount
of 913,655 Euro received from SL Benfica, SAD following the execution of the arbitration decision made
by the Arbitration Commission of the Portuguese Professional Football League. This outcome resulted
from a lawsuit brought by FC Porto, SAD in 2002, as part of the transfer by SL Benfica, SAD of the player
Miklos Feher.
The amounts included in the captions "Gains from the sales of players’ registrations” and "Losses from
the sales of players’ registrations " are presented net of the carrying amount of the players’
registrations, intermediation service costs incurred with that sales, and liabilities under the “solidarity
mechanism” (if and when applicable), the discount effect of accounts receivable and payable related
with those transactions and the cost of eventual compensation payments. On 30 June 2015 the caption
"Gains from the sales of players’ registrations" mainly refers to sale of players’ registration rights of:
Mangala (22,806,942 Euro), Danilo (23,101,403 Euro), Jackson Martinez (26,633,515 Euro) and Defour
(2,683,593 Euro), among others. On June 30, 2014, the most significant figures refer to the sale of
sports and economic rights of Otamendi (7,974,000 Euro), Fernando (5,298,000 Euro), Iturbe
(4,736,000 Euro), Christian Atsu (1,991,000 Euro) and André Castro (1,654,000 Euro), among others.
28. FINANCIAL RESULTS
Financial expenses and income for the years ended 30 June 2015 and 2014 are made up as follows:
30.06.2015
Financial expenses:
Interest
Discount effect of accounts payable
Other financial expenses
Financial income:
Interest
Discount effect of accounts receivable
Net financial expenses
30.06.2014
12,844,769
2,239,002
1,925,614
17,009,385
9,824,932
1,457,890
1,451,644
12,734,466
641,150
1,449,355
2,090,505
1,045,448
1,519,494
2,564,942
(14,918,880)
(10,169,524)
The balance of the captions ‘Discount effect of accounts receivable’ and ‘Discount effect of accounts
payable’ relate to interest resulting from the temporal difference between the transaction date of sale
/ purchase of the registration rights of several sports players and the dates of receipt / payment
contractually agreed.
In the years ended 30 June 2015 and 2014 the income interest relate, mainly, to interest payable by
FC Porto in accordance with the signed debt settlement agreement and in the meanwhile settled in
the year ended as of 30 June 2015 (Note 11).
___________________________________________________________________________________________
86
2014/2015
___________________________________________________________________________________________
29. INVESTMENT INCOME
The detail of caption “Gains and losses in investments” for the years ended 30 June 2015 and 2014 is
as follows:
30.06.2015
Impairment losses - players' economic rights (Note 9)
Capital gain arising on the disposal of economic rights (Note 9)
30.06.2014
(432,113)
1,528,226
1,096,113
(1,532,169)
(1,532,169)
In the year ended June 30, 2015 Santos FC sold the sporting registration rights of the player Sousa to
Fenerbahce for 8 million Euro; having FCP, SAD entitled to a value of 2,000,000 Euro, regarding 25% of
the economic rights of this player, generating a capital gain of 1,528,226 Euro.
30. RELATED PARTIES
Balances and transactions between the Company and its subsidiaries, which are related parties of this
have been eliminated in consolidation and therefore are not releases this Note. The principal balances
with other related parties, identified below, on 30 June 2015 and 2014 and the main transactions with
related entities during the year ended on that date, are detailed as follows:
Balances
FCP Clube
FCP Serv. Part.
Investiantas
Fundação Porto Gaia
PPTV/Olived./Sport TV
Sportinveste
Balances
Futebol Clube do Porto (Note 11)
Euroantas (Notes 24, 25 and 34)
F.C.P. Serviços Partilhados
FCP Media
Fundação Porto-Gaia
PPTV/Olivedesportos
Investiantas
Sportinveste
Transactions
FCP Serviços Partilhados
PPTV/Olivedesportos
Sportinveste
Investiantas
Fundação Porto Gaia
Accounts
Receivable
7,412,444
722,411
61,067
8,195,922
Accounts receivable
current and non-current
16,980,047
7,102,589
650,139
10,086
5,000,000
5,600
50,896
29,799,356
Sales and services
rendered
4,210,983
108,883
16,463,326
82,096
20,865,289
30.06.2015
Other current and non
current assets
Accounts
Payable
48,894
980,986
8,760
1,038,639
Other current and non
current liabilities
12,693,331
67,261
5,600
263,098
23,568
13,052,858
515,692
155,183
2,460
6,000,000
48,534
6,721,869
30.06.2014
Accounts payable
Other current and
current and non-current
non-current assets
48,076
4,048,748
641,265
11,600
4,749,689
Purchases and External
supplies and services
5,165,065
5,045,019
(695)
59,753
36,145
10,305,286
Other current and
non-current liabilities
11,268,845
14,963,937
289,157
26,521,938
30.06.2015
Income
interests
269,268
269,268
29,523
13,000,000
13,029,523
Interest
expenses
(47,396)
(47,396)
Other
expenses
471
(34,503)
(14,424)
(48,456)
___________________________________________________________________________________________
87
2014/2015
___________________________________________________________________________________________
30.06.2014
Transactions
Euroantas (Notes 24, 25 and 34)
FCP Serviços Partilhados
FCP Basket SAD
FCP Media
Fundação Porto-Gaia
PPTV/Olivedesportos
Sportinveste
Sales and
services
rendered
2,381,320
6,650,672
109,270
15,303,867
90,072
24,535,201
Purchases and
External supplies
and services
6,700,742
11,633,841
4,900,514
36,145
46,500
23,317,742
Income
interests
Other
expenses
797,629
797,629
976
(751)
225
Futebol Clube do Porto is the main shareholder of FC Porto, SAD (Note 16), Euroantas and FC Porto
Serviços Partillhados, S.A. are owned by this entity (53% and 96%, respectively). Additionally, is
presented above information of Group balances and transactions with the entities Sportinveste Multimédia, S.A. (‘Sportinveste’) and PPTV/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.
As of 30 June 2015 and 2014, the transactions with the entity PPTV/Olivedesportos recorded in the
caption “Sales and services rendered” are justified by the cession contract, in exclusivity, of the
broadcasting rights relating to the FCP – Futebol, SAD main team games in ‘Estádio do Dragão’ for the
Professional Football I League, as well as the static and virtual advertising commercial exploration
relating to those games, signed between the parties. On the other hand, the balance recorded on the
captions ‘Other current/non-current liabilities’ as of 30 June 2015 and 2014 corresponds, essentially,
to the advance received by the Company form the entity above relating to the mentioned rights, as
well as anticipated invoicing to the same entity on televising rights for the next seasons (Note 21).
As described in Note 4, the FCP Media became part of the consolidation perimeter since July 30, 2013
and Euroantas from 22 October 2014.
31. EARNINGS PER SHARE
Earnings per share for the year, were calculated according to the following amounts:
___________________________________________________________________________________________
88
2014/2015
___________________________________________________________________________________________
Earnings per share
30.06.2015
30.06.2014
Net profit/(loss) considered for the computation of basic earnings per share
19,351,824
(40,701,114)
Net profit/(loss) considered for computation of diluted earnings per share
19,351,824
(40,701,114)
15,000,000
15,000,000
4,972,603
-
19,972,603
15,000,000
1.29
0.97
(2.71)
(2.71)
Earnings
Number of shares
Weighted number of shares used to compute the basic earnings per share
Effect of potencial shares
Weighted number of shares used to compute the diluted earnings per share
Basic earnings per share
Diluted earnings per share
32. SEGMENT INFORMATION
Operationally, the Group is organised in two major segments:
Segment A:
activity related to the participation in professional football competitions, and
the promotion and organisation of sporting events represented by FCP SAD;
Segment B:
activity relating to the sale of image rights, sponsorship, merchandising and
product licensing represented by PortoComercial and Euroantas;
Other services: includes the activities of the subsidiaries PortoMultimedia, PortoEstádio
,PortoSeguro, FCP Media and Dragon Tour.
Operational income, indicating transactions with other segments and those resulting from transactions
with third parties, may be presented as follows:
Segm. A
Operational income excluding income related with transactions of
players' registrations
Resulting from operations with external clients
Resulting from operations with other segments
68,219,820
4,589,249
Segm. A
Operational income excluding income related with transactions of
players' registrations
Resulting from operations with external clients
Resulting from operations with other segments
48,523,451
267,614
Segm. B
30.06.2015
Other services
17,960,046
15,064,089
Segm. B
7,409,138
5,512,835
30.06.2014
Other services
18,368,234
827,816
5,721,145
5,394,219
Total
93,589,004
25,166,173
Total
72,612,830
6,489,649
The amounts related to operational profit, operational cash-flow and cash-flow, by segment, are as
follows:
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Segm. A
Operational profit / (loss)
Amortisation and depreciation excluding amortisation of players'
registrations
Operational cash-flow - EBITDA (a)
Financial expenses
Financial income
Income tax
Cash-flow (b)
30.06.2015
Other services
Segm. B
Eliminations
and
adjustments
Total
30,213,392
3,776,902
1,041,545
(650,588)
34,381,251
181,773
1,879,304
62,866
650,588
2,774,531
901,610
31,373,937
62,670,712
76,566
5,732,772
(345,740)
758,671
-
632,436
31,373,937
69,162,155
1,096,113
(15,975,098)
2,496,510
97,303
50,385,540
(1,414,034)
205,982
(423,732)
4,100,988
(848)
57
(316,866)
441,014
380,595
(612,044)
42,504
(188,945)
1,096,113
(17,009,385)
2,090,505
(600,791)
54,738,597
(a) - Earnings before taxes, financial results, depreciation and amortisation, provisions and impairment losses
(b) - Profit plus depreciation and amortisation, provisions and impairment losses
Segm. A
Operational profit / (loss)
Amortisation and depreciation excluding amortisation of players'
registrations
Operational cash-flow - EBITDA (a)
Financial expenses
Financial income
Income tax
Cash-flow (b)
30.06.2014
Other services
Segm. B
Eliminations
and
adjustments
Total
(24,090,881)
(1,434,037)
(261,381)
-
(25,786,299)
342,685
71,009
145,645
-
559,339
(296,686)
27,130,704
3,085,822
210,563
(1,152,465)
(150)
(115,886)
-
(86,273)
27,130,704
1,817,471
(1,532,169)
(12,396,891)
2,637,911
(3,012,708)
(11,218,035)
(626,365)
215,850
(38,868)
(1,601,848)
(236)
207
(168,350)
(284,265)
289,026
(289,026)
(1,532,169)
(12,734,466)
2,564,942
(3,219,926)
(13,104,148)
-
(a) - Earnings before taxes, financial results, depreciation and amortisation, provisions and impairment losses
(b) - Profit plus depreciation and amortisation, provisions and impairment losses
Data on total assets and total liabilities, as well as on the investment made in the year in
tangible and intangible assets, including players’ registrations, can be presented, by segment, as
follows:
Total assets
Total liabilities
Investment made in the current year (c)
Segm. A
Segm. B
268,782,076
241,878,838
136,932,732
60,112,251
53,485,281
120,232
Segm. A
Total assets
Total liabilities
Investment made in the current year (c)
Segm. B
30.06.2015
Other services
10,599,669
8,729,318
Eliminations
and
adjustments
(57,079,117)
(34,588,966)
359,235,360
276,131,441
-
-
53,605,513
30.06.2014
Other services
183,935,179
212,447,217
23,753,881
27,213,322
7,377,310
6,118,896
Eliminations
and
adjustments
(14,670,438)
(12,316,163)
18,834,334
800
-
-
Total
Total
200,395,932
233,463,272
18,835,134
(c) Fixed tangible and intagible assets acquisitions including players' registrations
As FCP Group is currently developing its activity exclusively in the internal market, geographical
segments are not reported.
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33. DERIVATIVE FINANCIAL INSTRUMENTS
In order to reduce its exposure to volatility from interest rates, the Group hires interest rate swaps.
These contracts are valued according to their fair value at the date of the financial statements and the
corresponding amount recognized in "Other financial instruments - derivatives" of the assets or
liabilities, as appropriate.
Derivative financial instruments recorded in the financial statements as of 30 June 2015 correspond to
an interest rate swap relating to a Group's financing loan. The Board of Directors believes that this
derivative fully meets the requirements of IAS 39 - Financial Instruments: Recognition and
Measurement, to be classified as a hedging instrument, so changes in their fair value are recorded
directly in equity.
On June 30, 2015, the derivative (swap) contracted by the Group had the following characteristics:
30.06.2015
Opening balance
Changes in the perimeter
Change in fair value
Accrued interests
Closing balance
Currency
EUR
Notional
(in currency)
6,322,263
Notional
(in Euro)
6,322,263
30.06.2014
-
(1,012,172)
(786,966)
-
249,011
204,372
11,729
20,834
(526,226)
(786,966)
Agreement date
29/08/2003
Due date
28/09/2018
34. CONTINGENT ASSETS AND LIABILITIES
Contingent Liabilities
i) Pepe - Maritime Madeira - Futebol SAD
On 14 October 2010, Marítimo da Madeira – Futebol, SAD (“Marítimo”) brought a declarative action
against FCPorto, SAD in the Professional Football Portuguese League claiming a rectification in the
amount due regarding the sale of the Pepe’s registration to Real Madrid in the amount of,
approximately, 840,000 Euro, which includes late payment interests. On 14 September, 2012, the
Arbitral Comission of LPFP decided as unfounded all the claims from Marítimo, acquitting FCP, SAD.
Subsequently, on 17 October, 2012, Marítimo presented appealed to decision to the plenary of LPFP.
In December 2013 the request for the annulment of the decision of the Plenary of the LPFP Arbitral
Commission initiated by Maritime Football SAD within the Porto Civil Courts of Porto was denied, and
from this decision has brought an appeal to the Court of Appeal of Porto, by Maritimo SAD being this
process at the moment yet to be processed.
The Board of Directors of the Company and its legal consultants, understands that the grounds
considered by the clubs in the above processes are not correct, by which it was presented contestation,
and it’s not estimated that from the outcome of these processes arise in any material impact on the
consolidated financial statements.
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ii) Kléber - Maritime Madeira - Futebol SAD
On 18 October 2011, Marítimo da Madeira – Futebol, SAD (“Marítimo”) brought a declarative action
against FCPorto, SAD in the Professional Football Portuguese League claiming a sum by way of
"compensation for promotion or appreciation" of the player Kléber Laube Pinheiro, having been
rejected. Subsequently, the decision was annulled by the civil courts of Porto at the request of
Marítimo and the appeal of FC Porto, SAD, from this annulment decision was denied. The Board of
Directors, as well as its’ legal consultants, consider that the grounds presented by Marítimo is not
correct; therefore no impacts over the consolidated financial statements are estimated to occur arising
from the outcome of this action.
iii) João Moutinho - Sporting
Was brought by Sporting Clube de Portugal, SAD, within the LPFP Arbitral Commission, a declarative
judgment action concerning the definitive cession of the palyers’ registration rights relating to the
athlete João Filipe Iria Santos Moutinho, contract under which it was attributed to Sporting SAD the
right to receive 25% of the capital gain recorded in a future transfer of the player to a third club. On
September 17, 2014 the LPFP Arbitral Commission notified FCP, SAD from the decision concerning this
process in which the Company has condemned to the payment, to Sporting Clube de Portugal, SAD, of
the amount of 658,047 Euro plus interest. The Board of Directors of the Company and its legal
consultants, understands that the grounds presented by Sporting are not correct, so it appealed from
the decision to the LPFP Arbitral Commission Plenary in October 6, 2014, not estimating to occur, from
the outcome of this action, any material impacts over the consolidated financial statements.
The Board of Directors of the Company and its legal consultants, understands that the grounds
considered by the clubs in the above processes are not correct, by which it was presented contestation,
and it’s not estimated that from the outcome of these processes arise in any material impact on the
consolidated financial statements.
Contingent Assets
i) Tax litigations
The Company made in previous years, payments for additional assessments of tax, recording such
payments as an expense in the period in which such payments occurred. However, the Company
maintains the complaints and judicial claims, calling for the return of such amounts.
Thus there are the following contingent assets of tax to 30 June 2015:
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Tax
Nature
IRC 2003
IVA 2003
IRC 2005
IRC 2007
IRC and IVA 2008
IRC 2009
IRC e IRS 2010
Additional tax settlement
Contingent
asset
30.06.2015
2,155,916
171,369
626,650
416,475
823,732
979,550
316,366
5,490,058
ii) Property municipality tax
In a public meeting of the Municipal Council of Porto held on April 18, 2006, it was unanimously
approved the proposed classification of the “Estádio do Dragão” as "property of municipal interest."
In February 2008, an order by the Porto Tax Services approving the request for Property municipality
tax exemption ("IMI") was issued in respect to the property, and that, according to legislation
expressed in the Tax Benefits Statute will apply for the years 2006 and following. In October 2006, the
Board of Directors of Euroantas addressed a request to the Minister of Finance requesting that the IMI
exemption obtained would be applicable since 2004. However, in February 2008, the Group received
an IMI settlement note for the years 2004 and 2005 whose total value amounted to 343,871 Euro.
Despite this amount was recorded as an expense in the income statement for the year ended June 30,
2008, the Company’s Board of Directors understands that there is grounding to justify that the
exemption would also apply to the years 2004 and 2005, in July 2008, the Group presented an
administrative claim regarding the referred settlement; this claim was dismissed and subsequently
there has been presented a judicial claim.
As has not yet been any further development in this process, the Group continues to wait for a final
decision.
35. SUBSEQUENT EVENTS
The following events took place after the date of the financial statements and, by its relevance, are
presented as follows:
i) Players’ registration acquisitions:
a) Acquisition of the sporting registration rights for 5 seasons and 100% of the economic rights
of the player Imbula from Olympique de Marseille by 20,000,000 Euro.
b) Acquisition of the sporting registration rights for 5 seasons and 70% of the economic rights of
the player Corona from FC Twentepor for 10,500,0000 Euro;
j) Players’ registration sales:
Transfer, on a permanent basis, of the player’s registration of the professional football player Alex
Sandro in the amount of 26,000,000 Euro.
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k) Players’ Contract Renewals
Renegotiation of the player's sports employment contract of Brahimi and increasing the termination
clause from 50,000,000 Euro to 60,000,000 Euro.
l) Players’ loans
FC Porto SAD gave the sporting registration rights of the player Quintero to Stade Rennais Football
Club for a sporting season, until July 2016. The agreement contemplates the call option over the
economic rights of the player in the amount of 20,000,000 Euro.
36. APPROVAL OF THE FINANCIAL STATEMENTS
The accompanying financial statements were approved by the Board of Directors on 8 October 2015.
37. 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) as adopted by
the European Union and the format and disclosures required by those Standards, 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.
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7. Legal Certification of Accounts and Audit Report
(Translation of a report originally issued in Portuguese – Note 37)
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
on the accompanying consolidated financial statements for the year ended 30 June 2015 of Futebol
Clube do Porto – Futebol, S.A.D. (“Company”) and subsidiaries (“Group”), which comprise the
Consolidated Statement of Financial Position as of 30 June 2015 (that presents total net assets of
359,235,360 Euro and shareholders’ equity of 83,103,919 Euro, including a net consolidated profit
attributable to the Parent company of 19,351,824 Euro), the Consolidated Statements of Profit
and Loss, of Comprehensive Income, of Changes in Equity and of Cash Flows 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, the consolidated results and comprehensive income of their operations, the
changes in consolidated 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 internal control systems; and (iv) the disclosure of any
significant facts that have influenced the operations of the Company and companies included in
the consolidation, their financial position, results and comprehensive income.
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 independent report based on our examination.
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 test basis, evidence supporting the amounts and disclosures in the consolidated financial
statements and assessing the significant estimates, based on judgments and criteria defined by
the 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 assessing that, in all material
respects, the consolidated financial information is complete, true, timely, clear, objective and licit.
Our examination also comprised verifying that the consolidated financial information included in
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the consolidated Board of Directors’ Report is consistent with the consolidated financial
statements as well as the verifications established in numbers 4 and 5 of the article 451º of the
Commercial Company Code (“Código das Sociedades Comerciais”). 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, 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 2015, the consolidated results and comprehensive income of its
operations, consolidated changes in its equity and its consolidated cash flows for the year then
ended, in accordance 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, complete, true, timely, clear,
objective and licit.
Emphasis
6. The Company’s individual financial statements as of 30 June 2015, show that almost of its share
capital has been lost and, as such, the provisions of articles 35 and 171 of the Commercial Company
Code (“Código das Sociedades Comerciais”) are applicable. Additionally, the individual and
consolidated financial statements on that date represents a negative working capital. As
mentioned in the Board of Directors’ Report and in Note 16 of the Notes to the consolidated
financial statements, the Board of Directors understands that this situation should be analysed and
decided by the General Shareholders Meeting, in order to fulfill the requirements of the legislation
referred above. The accompanying consolidated financial statements were prepared on a going
concern basis, which considers the continued financial support of the financial institutions and
other financing institutions, namely the renovation/reinforcement of existing credit lines (Note
18), as well as the success of the Company’s future operations, including the positive outcome of
the disposal of players’ registrations, and as foreseen in its operating and cash-ﬂow budgets,
essential to the balance and fulfilment of financial commitments.
Reporting over other legal requirements
7. It is also our opinion that the financial information included in the Board of Directors’ Report is in
accordance with the consolidated financial statements of the year and that the Corporate
Governance Report includes the information required to the Company, as established by the
Article 245º- A of the Securities Market Code.
Porto, 9 October 2015
Deloitte & Associados, SROC S.A.
Represented by António Manuel Martins Amaral
l
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8. Report and Opinion of the Audit Committe
Shareholders,
The Audit Committee of FC Porto - Futebol, SAD, in compliance with legal and statutory provisions and
the mandate given to it, is to report and evaluate the management report and other provision of
individual financial statements and consolidated accounts for the year ending on June 30 2015, at the
responsibility of the Board of Directors.
Supervision
During the year, the Audit Committee tracked and monitored the management of the group, the
evolution of its activity and its subsidiaries, and to this end made meetings with the frequency and
length considered appropriate. These meetings had the participation, considering the matters being
analysed, of those responsible for the areas of Accounting and Taxation, Financial Planning and Control
Management, Legal Department and the Board of Directors. Also kept close contact with the official
auditor and external auditor that kept us informed of the nature and findings of audits. In fulfilling
these functions the Audit Committee always received, from the Board, the various services of the
group, the companies included in the group, and the auditor all information and explanations required,
in particular for the proper understanding and evaluation of business development, performance and
financial position and of risk management and internal control systems.
There was a monitoring of the process of preparation and disclosure of financial information, as well
as reviewing the provision of individual and consolidated accounts of company documents, and the
official auditor received all information and explanations required. As part of its responsibilities, the
Audit Committee examined the individual and consolidated balance sheets on June 30, 2015, the
individual and consolidated statements of profit and loss, cash flows and comprehensive income and
changes in equity for the year than ended in that date and the accompanying notes.
The annual report issued by the Board of Directors was analysed, and the legal certification of accounts
and audit report on the accounts, issued by the statutory auditor, which deserve the agreement of the
Audit Committee.
Given the above, the Audit Committee is of the opinion that the information in the financial statements
has been drafted in accordance with the accounting, legal, and statutory standards applicable and give
a true and fair view of the assets and liabilities, financial position and results of Futebol Clube do Porto
- Futebol, SAD and the undertakings included in the consolidation perimeter and that the management
report faithfully reflects the development of business, performance and financial position of the same
and the undertakings included in the consolidation perimeter and contains a description of the
principal risks and uncertainties that they face.
The most relevant facts occurred after the closure of accounts were analysed and duly explained in the
Management Report.
The Audit Committee expresses its thanks for the invaluable collaboration of the Board of Directors
and services.
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Advice
Accordingly, we are of the opinion that the conditions are met so that the General Assembly approves:
a)
the Management Report, the individual and consolidated balance sheets on June 30 2015, the
individual and consolidated statements of results by nature, of cash flows and correspondent
annexes;
b)
the proposition to apply the results of individual accounts presented by the Board of Directors.
Certificate of Responsibility
The members of the Audit Committee of Futebol Clube do Porto - Futebol, SAD, in accordance with
line c) of n. 1 of article 245 of the Portuguese Securities Code, declare that, to the best of their
knowledge, the information specified in line a) of that article, including the documents of the individual
and consolidated accounts, was prepared in accordance with the applicable accounting standards, give
a true and fair view of the assets and liabilities, financial position and results of the Group and
undertakings included in the consolidation perimeter, and contains a description of the principal risks
and uncertainties that it faces.
Porto, October 9 2015
The Audit Committee
José Paulo Sá Fernandes Nunes de Almeida – Chairman
Armando Luis Vieira de Magalhães - Member
Filipe Carlos Ferreira Avides Moreira – Member
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C. Corporate Governance Report
PART I – INFORMATION ON THE SHAREHOLDER,
ORGANIZATION AND CORPORATE GOVERNANCE STRUCTURE
A. SHAREHOLDER STRUCTURE
I. Capital structure
1. Capital structure
The share capital of FC Porto - Futebol, SAD is, on June 30, 2015, of 112,500,000€ (one hundred and
twelve million five hundred thousand euros), represented by 22,500,000 (twenty two million five
hundred thousand) shares with a nominal value of 5€ (five euros) each.
On June 30, 2014, the share capital was 75,000,000. However, the General Meeting of Shareholders
on October 2 2014, approved the capital increase in the amount of 37,500,000€ through the issuing of
preferential shares without voting rights. Following this capital increase, which was fully subscribed by
Futebol Clube do Porto, the capital of the Group now amounts to a total of 112.500.00€ (one hundred
and twelve million five hundred thousand euros), having not been any changes to the social capital of
FC Porto - Futebol, SAD since then.
Thus, to this date, the share capital is fully subscribed and paid up and is divided into 7,500,000
preferential shares without voting rights and 15,000,000 ordinary shares Category A and Category B
(respectively 61.89 % and 38.11% of the capital), depending on the identity of the holder. Category A
shares only integrate this category while held by Futebol Clube do Porto, or the Management Company
of shareholdings in which the club holds the majority of share capital, automatically converting into
Category B shares in the event of alienation to a third party in any way. For the purpose of exercising
the right to vote, each ordinary share represents one vote.
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___________________________________________________________________________________________
June-30-2015
June-30-2014
Category A
9.282.931
6.000.000
Category B
5.717.069
9.000.000
Preferential without voting rights
7.500.000
0
22.500.000
15.000.000
Shares in category A give the shareholder the following special rights:
• Right to veto the decisions of the general meeting intended to merge, split, transform or dissolve the
company and the change in statutes, increase or reduction of social capital and change of headquarters
(article 7, n. 2 of statutes), according to article 23, n. 3 od Decree 10/2013 of January 25.
• Right to appoint at least one of the members of the Board of Directors, which will have the right to
veto in consideration of that entity with a similar objective as n. 2 of article 7 in the Statutes (article
11, n. 3 in statutes1).
2. Restrictions regarding the transmission of shares and share holders
There are legal restrictions to the holding of shares representing the capital of FC Porto – Futebol, SAD,
due to the specific demands of the sporting activity that rule its existence. Sporting companies are
ruled by the special legal regime set in Decree 67/97, on April 3 according to the changes introduced
by Law n. 107/97, on September 16, followed by Decree n. 10/2013, on January 25. Among those
specific demands are:
•
The existence of two categories for shares, with category A shares remaining subscribed and
held, at any time, by the founding club, can only be legally apprehended or encumbrance in
favour of collective people of public right;
•
The special loyalty system of the Company to the founding club, which means that the club is
forced to maintain a minimum participation in the Company (not inferior to 10%); in attributing
special rights to the shares held by the founding club.
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3. Own shares
FC Porto – Futebol, SAD holds 100 own shares, consolidated, worth 499€. These shares, with a very
small representation in the social capital of the company, are held by PortoSeguro, a company in the
consolidation perimeter, held at 90% by FC Porto – Futebol, SAD.
PortoSeguro acquired 100 shares when the SAD was created, in 1997, and hasn’t alienated or acquired
any share since. Thus, FC Porto – Futebol, SAD had, both at the start and at the end of the period under
analysis, 100 own shares, worth 500€ at the time of buy.
4. Significant agreements involving the company and which start, change or cease in case the control
of the company changes following a public acquisition offer, as well as its effects
There are no significant agreements of which the company is part and that will start, change or cease,
in case the control of the Company changes following a public acquisition, or agreements between FC
Porto – Futebol, SAD and the holders of the board of directors or workers foreseeing compensations
for renounce or destitution of members of the board, nor in case of dismissal of worker, firing without
a cause or termination of work relation, following a public acquisition offer.
FC Porto – Futebol, SAD has also not adopted any measure intending to stop the success of public
offers of acquisition that disrespect the interests of the Company and the shareholders.
5. Regime controlling the renewal or revocation of defensive measures, especially those that foresee
the limitation in number of detainable votes or belonging to a single shareholder, individually or
under several shareholders
Under the terms of line 3 of article 7 of the statutes FC Porto - Futebol, SAD, the votes of shareholders
of the Group who hold preferential shares without voting rights that may confer voting rights pursuant
to Article 342, n. 3 of the Companies Act, will not be considered during the period in which to exercise
his right to vote (i.e., the period after two fiscal years without receiving the priority dividend until the
date of payment of a preferred dividend), if their share in total capital exceeds more than a third of
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the total votes corresponding to the share capital of FC Porto - Futebol, SAD. Therefore, if FC Porto has
voting rights corresponding to 7,500,000 preferential shares without voting rights, such right will not
be exercised in view of this vote limit.
6. Prosocial agreements known to the company and that may lead to restrictions in terms of
transmission of assets or rights to vote
The Board of Directors is unaware of any prosocial agreement as described in Art. 19 of the Portuguese
Security Code regarding the exercise of social rights, or the transmission of shares of FC Porto –
Futebol, SAD.
There is no union to vote or defence agreement against public acquisition offers (take-overs).
II. Social Participations and Obligations detained
7. Qualified holdings
Under and for the purposes of Articles 16 and 20 of the Securities Code and Article 448 of the
Companies Code, it is reported that the Company and / or individuals with qualified social participation
exceeding 2%, 5%, 10%, 20%, a third, 50%, two thirds and 90% of the votes, and according to reports
received at the headquarters of the Company are, as of June 30 2015, as follows:
Directly – Ordinary Shares
Directly – Preferential Shares
Through Jorge Nuno de Lima Pinto da Costa
Through Alípio Jorge Calisto Fernandes
Through Álvaro José Pereira Pinto Júnior
Through Eduardo Jorge Tentugal Valente
Through Ilídio Borges Pinto
Through Reinaldo da Costa Teles Pinheiro
Total Attributable
N. of Shares
9,282,931
7,500,000
250,000
2,175
275
200
10,450
9,850
17,055,881
% Voting rights
61.89%
0.00%
1.67%
0.01%
0.00%
0,00%
0.07%
0.07%
63.71%
António Luís Alves Oliveira
Directly
Through Francisco António de Oliveira
Total Attributable
N. of Shares
1.650.750
980
1.651.730
% Voting rights
11,01%
0,01%
11,01%
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Joaquim Francisco Alves Ferreira de Oliveira
Through Olivedesportos – SGSPS, SA
N. of Shares
1.502.188
% Voting rights
10,01%
8. Number of shares and bounds held by members of the Board of Directors and Advisory Council,
under the terms of n. 5 of art. 447 of the Portuguese Companies Code
Under the terms of art. 447 of the Portuguese Companies Code, it should be informed that, as of June
30 2015, the directors of FC Porto – Futebol, SAD had the following shares:
Shares held by members of the Board of Directors
Jorge Nuno de Lima Pinto da Costa*
Number of shares
250.000
Adelino Sá e Melo Caldeira*
0
Fernando Manuel Santos Gomes *
0
Reinaldo Costa Teles Pinheiro*
9.850
0
* Futebol Clube do Porto, of which he is Chairman/Vice-Chairman of the Board, had 9.282.931 shares in June 30
2015
Shares held by members of the Advisory Council
José Paulo Sá Fernandes Nunes de Almeida
Number of shares
100
Armando Luís Vieira de Magalhães
0
Filipe Carlos Ferreira Avides Moreira
10
José Augusto dos Santos Saraiva
0
As of June 30 2015, the Auditor had no representative shares of the social capital of FC Porto – Futebol,
SAD.
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9. Special powers of the Board of Directors, regarding the increase of capital
Without prejudice of the several given by Law and the Statutes of the Company, the Board of Directors
must assure the management of any social business and any operation regarding social focus, as they
are given full powers, namely to:
a) Represent the Company, at all times, propose and dispute any actions, demand and release
and make commitments in terms of decisions. For that, the board must delegate these powers
in one mandatary;
b) Create a company budget, to be approved by the General Meeting;
c) Acquire, alienate and ornate or relocate assets, including shares, quotas, bounds and right to
sign players;
d) Sign sporting contracts and sporting training contracts and proceed to dismiss them, by mutual
or unilateral agreement;
e) Acquire real-estate;
f)
Decide if the Company should associate with other entities, under the terms of art. 4 of the
Statutes;
g) Decide on the emission of bounds and apply for loans in the national and/or international
financial market and accept audits from relevant entities;
h) Appoint any other individual or collective entity for social positions in other companies.
The Board of Directors does not hold powers to decide on the increase of capital. As determined in
article 7 of the Statutes of the Company, any increase to the capital requires previous analysis of the
General Meeting, as shares of Category A, held by Futebol Clube do Porto (Clube), offer right to veto
of any decision of the General Meeting which aim at increasing or decreasing if social capital. Still, as
line b) of article 23, n. 2 of Decree n. 10/2013, of January 25 goes into effect, FC Porto no longer has,
by Law, the right to veto over the change in statutes of FC Porto SAD or over the increase and decrease
of social capital of that company, now being given the right to veto any chance to the emblem or
equipment of its professional football teams.
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10. Relevant commercial relations between owners of bounds and the Company
There are no significant economic businesses for any of the parties involved, between the Company
and the member of the Board of Directors, Audit Board, owners of qualified holdings or Companies
under control of the Group, except the businesses or operations done under normal circumstances for
similar operations, part of the current activity of the Company.
B. SOCIAL BODIES AND COMMITTEES
I. GENERAL MEETING
a) Members of the General Meeting Board
11. Identification and position of the members of the board of the general meeting and its term
In the General Meeting on February 13 2012, it was decided to elect, for the period of 2012/2015, José
Manuel de Matos Fernandes as chairman of the General Meeting and Rui Miguel de Sousa Simões
Fernandes Marrana as secretary of the General Meeting.
b) Exercising right to vote
12. Possible restrictions in terms of right to vote
FC Porto – Futebol, SAD, before each General Meeting, and following the legal dates, discloses the
warning that a meeting will be held, including in the institutional website of the Company
(www.fcporto.pt).
According to the Statutes of the Company, all shareholders with voting right may participate in a
General Meeting, as long as the shares are under their name by zero hours (GMT) of the 5th working
day before the meeting, and if they prove their registration before the Company until the same of that
5th day, stating their intention to be a part of the meeting in a written letter addressed to the Chairman
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of the General Meeting no later than the sixth day before the General Meeting, with the option of
using electronic mail to do so. Still, the last Chairmen of the General Meeting have decided that,
considering the issues with delivery of declarations of shares, any copies received by fax or e-mail
should be accepted, as long as they follow the date disclosed in the Statutes and if the original is
received before the General Meeting.
Shareholders that have a statute of singular person may be represented in the General Meetings under
the current Law. Collective should be represented by someone designated to do so through a letter
that must be admitted by the Chairman of the General Meeting.
The Company offers the Shareholders a representation form which can be requested at the Company,
by phone (+351225070500) or e-mail ([email protected]). The documents for voluntary representation
must be handed at the social headquarters, addressed to the Chairman of the General Meeting, at
least three days before the General Meeting, and specifying the relevant meeting, by stating the date,
time and location it will be held and the Order of Work, leaving no doubts to the Chairman about the
representative, which must be identified.
The statutes of the Company, on n. 4 of art. 8, admit the issuing of preferential shares, without vote
rights, that may be redeemable, for the nominal value, added of a prize or not, if the General Meeting
decides to do so. Should this be the case, the prize for the remission must be defined. In case the
remission is not complied, the company must compensate the holder, for an amount set during the
remission. On October 31 2014, there was an increase to the issuing capital by issuing preferential
shares, without the right to vote, worth 37.500.000€.
By the end of each General Meeting, the Company issues a statement, made available on their website,
as well as in the official website of CMVM, with the decisions made, the capital represented and the
results of the voting. The minutes of the meetings are sent to any shareholder that requests them. To
follow the recommendations of CMVM, the Company, as of 2009, made these minutes available at
their website, for fifteen days, as stipulated in Decree n. 49/2010.
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13. Maximum percentage of vote rights that may be used by a single shareholder or by shareholders
connected through n. 1 of art. 20
Regarding the right to vote, each share means one vote, and attendance at the General Meeting is not
restricted to a minimum number of shares.
Under the terms of line 3 of article 7 of the statutes FC Porto - Futebol, SAD, the votes of shareholders
of the Group who hold preferential shares without voting rights that may confer voting rights pursuant
to Article 342, n. 3 of the Companies Act, will not be considered during the period in which to exercise
his right to vote (i.e., the period after two fiscal years without receiving the priority dividend until the
date of payment of a preferred dividend), if their share in total capital exceeds more than a third of
the total votes corresponding to the share capital of FC Porto - Futebol, SAD. Therefore, if FC Porto has
voting rights corresponding to 7,500,000 preferential shares without voting rights, such right will not
be exercised in view of this vote limit.
The Group intends to submit to the General Meeting the maintenance / termination of this vote limit
in future Meetings.
14. Decisions that, by statutory requirement, can only be taken by a qualified majority
According to article 20 of the Statutes, the General Meeting will rule over any number of shareholders
present or represented, in both calls, without legal demands of a constitutive number for certain acts,
and, namely, the need to, in the first call, there are at least two thirds of the total number of votes for
the Meeting to approve some of the acts foreseen in art. 13, n. 2 of these Statutes (“Any act exceeding
the previsions inscribed in the budget requires authorization of the general meeting, after a
deliberation approved by simple majority, and the alienation and transaction, of any kind, of assets
pertaining to the patrimony of the Company must be approved by two thirds of the votes issued”).
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II. ADMINISTRATION AND SUPERVISION
a) Composition
15. Identification of the business model adopted
The structure of the Governing Body of the Company is based on the reinforced Latin model and is
composed of the Board of Directors, Audit Board and the Auditor, voted by the General Meeting of
Shareholders.
16. Statutory rules on procedural requirements and applicable material to appoint and replace the
members, if applicable, of the Board of Directors
The replacement of a director will occur under the terms of the Portuguese Companies Code, as there
are no statutory rules on that matter, occurring in one of the following: if there are no substitute
directors, the Board must choose a director, which will be approved in the next General Meeting; if a
choice isn’t done in 60 days, the Audit Board will appoint a substitute director, which must also be
approved on the next General Meeting; if that doesn’t occur, the new director will be elected on the
General Meeting.
There are no statutory rules that set the selection process of the non-executive directors. The election
of the Governing Bodies, namely the Board of Directors, including all the members, is done as one
process, in a list presented by the shareholders that wish it and approved in General Meeting.
17. Composition of the Board of Directors
According to the Statutes of the Company, the Company is ran by a Board of Directors, composed of
three, five, seven or nine members, which must be professional managers, elected in General Meeting,
and appoint a chairman, if one hasn’t been set in the Meeting. The mandate of the governing bodies
lasts four years, and re-election may occur one or more times.
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Currently, this body is composed of 5 members, 4 of which are executive, and all must manage the
Company.
In a Shareholder General Meeting, held on the 13th of February 2012, the following elements were
elected for the 2012/2015 mandate of the Board of Director, with the following positions:
Jorge Nuno de Lima Pinto da Costa (Chairman)
Date of first
election
23-Sept-1997
Date of term of
mandate
31-Dec-2015
23-Sept-1997
31-Dec-2015
Fernando Manuel Santos Gomes (*)
31-Mar-2014
31-Dec-2015
Reinaldo Costa Teles Pinheiro
23-Sept-1997
31-Dec-2015
Rui Ferreira Vieira de Sá (non-executive)
13-Feb-2012
31-Dec-2015
Name
(*) Following the renunciation of Angelino Cândido de Sousa Ferreira from the position of Director,
Fernando Manuel Santos Gomes was chosen for that position, starting on March 31 2014.
18. Difference between executive and non-executive members and identification of non-executive
members that may be considered independent
On June 30 2015, the Board of Directors included a non-executive member: Rui Ferreira Vieira de Sá.
The members of the Board of Directors are not independent, with the exception of Rui Ferreira Vieira
de Sá, as they are part of the Board of Directors of Futebol Clube do Porto, which holds about 75% of
the capital and 62% of the voting rights, of Futebol Clube do Porto - Futebol, SAD, and that exercises a
dominant influence over it.
The non-executive director conducted his duties not only by participating in the meetings of the Board
of Directors, but also by accompanying and supervising the work of the executive directors, by
requesting further information on matters analysed by the Board of Directors, such as financial,
governance and regulatory aspects. It should be said there were no restraints to the work done by the
non-executive director.
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Any information requested to the other members of the Governing Bodies was given as quickly as
possible and adequately.
19. Professional qualifications of the members of the Board of Directors
Jorge Nuno de Lima Pinto da Costa
• Education: Secondary complete
• Other positions held at FC Porto Group, referred to in section 2.2.2.
• Degree in Law by the Universidade Federal do Estado do Rio de Janeiro, 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
• Degree in Economics by the Instituto Superior de Ciências Económicas e Financeiras da Universidade
Técnica de Lisboa, in 1971
• Other positions held at the Grupo FC Porto, referred to in section 2.2.2.
• Education: 1st Cycle of Basic Education
• Degree in Civil Engineering by the Faculdade de Engenharia of Universidade do Porto, in 1977
• From 1977 to 1996, Head of Services and Construction Director of Grupo Somague
• Other positions referred to in section 2.2.2.
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20. Family or financial relations, usual or significant, between members of the Board of Directors
and shareholders with a qualified participation above 2% of the voting rights
There are no family, professional or business relations, usual or significant, between members of the
Board of Directors and shareholders with a qualified participation above 2% of the voting rights.
21. Organigram or functional maps regarding the distribution of competences between the several
governing bodies, committees and/or departments of the Company, including information about
delegation of competences, especially referring to the delegation of the daily management of the
Company
The Governing Bodies of FC Porto - Futebol, SAD are composed of the General Meeting, the Board of
Directors, the Audit Committee, the Statutory Auditors, the Company Secretary, the Advisory Board
and the Remuneration Committee.
FC Porto - Futebol, SAD has no executive committee, given its small dimension, and holds the
Management Board responsible for ensuring the daily management of the Company.
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b) Functioning
22. Existence and location where the regulations for the functioning of the Board of Directors may
be consulted
The Governing Bodies of FC Porto – Futebol, SAD do not have formally approved functioning
regulations. However, the members intend to set those regulations and disclose them afterwards in
the website of Futebol Clube do Porto (www.fcporto.pt).
23. Number of meetings held and attendance of each member of the Board to the meetings
In this period, the Board of Directors met 9 times, and a minute was made for each meeting. These are
available to any Governing Body who wishes to consult them. All executive members of the Board
attended all the meetings.
24. Indication of the bodies of the Company that may assess the performance of the executive
directors
Considering the model of the Governing Body implemented by FC Porto – Futebol, SAD, that integrates
a Remuneration Committee, and given the small size of the Company, it was decided that there was
no need for the creation of specialized commissions with the single purpose of evaluating the
performance of the executive directors or the activity of existing commissions.
On the other hand, FC Porto – Futebol, SAD, for its specificity as a Sporting Company, in the
performance of its activity, has a number of obligations to keep in face of sporting bodies. In order to
participate in national and European competitions, the Company has to meet a number of criteria,
especially of financial order, which, in a way, will prove the competence of the Board, as, if they are
not met, the team will be excluded from competing.
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25. Pre-established criteria to evaluate the performance of the executive directors
Under the terms of their competences, the Remuneration Committee, re-elected on February 2012 for
the period 2012/2015, decided to change the remuneration policy approved in General Meeting,
which, despite being analysed annually, remained the same throughout the term. Just as in the
previous period, there were no variable remunerations, considering the sporting performance of the
main squad of FC Porto.
The proposition for the new remuneration policy of the Board of Directors and supervision of the
Company was presented and analysed by the shareholders in the General Meeting of 2014, having
been approved.
In this period, the remunerations of the members of the governing body did not depend on the
evolution of the quotas of shares or any other variable.
There was no plan to offer shares or options to acquire shares to the directors. There was also no policy
or measure set in terms of offering compensations contractually negotiated, in case of termination of
duties or early retirement, or mechanisms to limit the variable remuneration. There was no contractual
obligation regarding the compensation for dismissal without cause.
26. Availability of each member of the Board of Directors, indicating the positions held
simultaneously with other companies, in and out of the Group, and other relevant activities held by
the members of those Bodies during this period
• Chairman of the Board of FC Porto
• 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 Directors 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 FC Porto – Serviços Partilhados, SA
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• Chairman of the Board of FCP Media, SA
• Chairman of the Board of Dragon Tour, Agência de Viagens, SA
• Vice-Chairman of the Board of FC Porto
• 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 FCPortoMultimédia, Edições Multimédia, SA
• Member of the Board of PortoComercial, Sociedade de Comercialização, Licenciamento e Sponsorização, SA
• Manager of PortoSeguro – Sociedade Mediadora de Seguros do Porto, Lda.
• Member of the Board of FC Porto – Serviços Partilhados, SA
• Member of the Board of FCP Media, SA
• Member of the Board of Dragon Tour, Agência de Viagens, SA
• Member of the Board of Directors of Galp Energia, SGPS
• Member of the Board of EuroAntas, Promoção e Gestão de Empreendimentos Imobiliários, SA
• Member of the Board of PortoComercial, Sociedade de Comercialização, Licenciamento e Sponsorização, SA
• Member of the Board of PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, SA
• Manager of PortoSeguro – Sociedade Mediadora de Seguros do Porto, Lda.
• Member of the Board of FC Porto – Serviços Partilhados, SA
• Member of the Board of FCP Media, SA
• Member of the Board of Dragon Tour, Agência de Viagens, SA
Reinaldo Teles da Costa Pinheiro
• Chairman of the Board of Somague SGPS, SA, startingJanuary 15 2013;
• Chairman of the Board of Somague Engenharia, SA;
• Chairman of the Board of Somague Concessões de Infraestruturas, SA;
• Chairman of the Board of Engenharia S.A. do Brasil;
• Chairman of the Board of Escala Braga - Sociedade Gestora do Edifício, S.A.;
• Chairman of the Board of Escala Vila Franca – Sociedade Gestora do Edifício, S.A.;
• Chairman of the Board of Neopul – Sociedade de Estudos e Construções, S.A.;
• Member of the Board of Somague Engenharia Sucursal Cabo Verde ;
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• Member of the Board of da Viaexpresso da Madeira, S.A.;
• Member of the Board of Escala Parque – Gestão de Estacionamento, S.A.;
• Member of the Board of PNH – Parque do Novo Hospital, S.A.;
• Member of the Board of Soconstroi PMG, S.A.;
• Member of the Board of CVC – Construções de Cabo Verde, SARL;
• Member of the Board of Administração da Somague MPH Construções, S.A.; e
• Member of the Board of Estudos e Construções, S.A. Sucursal Espanha.
c) Commissions in the Governing Bodies and delegated directors
27. Identification of commissions created in the Board of Directors and where can the regulations be
found
The Board of Directors believes that the only specialized commission capable of facing the needs of
the Company, considering the dimension and complexity, is the Remuneration Committee.
The Remuneration Committee of FC Porto – Futebol, SAD aims at setting the remunerations of the
members of the Governing Bodies of the Company and set the remuneration policy to be applied to
the member of the Board of FC Porto – Futebol, SAD.
The current Remuneration Committee of FC Porto – Futebol, SAD (for the period 2012-2015) is
composed of the following members:
•
Alípio Dias (Chairman)
•
Fernando Freire de Sousa
•
Joaquim Manuel Machado Faria de Almeida
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28. Composition, if applicable, of the executive commission and/or identification of delegate
director(s)
FC Porto – Futebol, SAD did not appoint an Executive Commission of the Board of Directors, and any
decisions regarding strategies adopted by the Board of Directors as a body will be composed of all
members, executive and non-executive, in the normal performance of their duties.
29. Competences of each commission created and summary of the activities developed when doing
those competences
The Board of Directors believes that the only specialized commission capable of facing the needs of
the Company, considering the dimension and complexity, is the Remuneration Committee.
The Remuneration Committee is composed of members independent to the administration. To that
extent, the Remuneration Committee does not include any member of another governing body to
which it sets the respective remuneration, and the three members have no family bonds with members
of other bodies, including as their spouses, kin or straight line to the 3rd degree. The members of the
Remuneration Committee have knowledge and experience concerning remuneration policy. During
the financial year of 2014/2015 the Remuneration Committee did not find necessary to hire additional
support to their duties. After each meeting, the Remuneration Committee produces a minute.
This committee is responsible for assessing the performance of the executive directors and consequent
remuneration, and will follow the criteria they see as fit, in compliance with the law and the current
statutory practices.
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III. SUPERVISION
a) Composition
30. Identification of the supervision body on the adopted model
The structure of the Governing Body of the Company is based on the reinforced Latin model and is
composed of the Board of Directors, Audit Board and the Auditor, voted by the General Meeting of
Shareholders.
31. Composition of the Audit Committee, indicating the minimum and maximum statutory number
of members, statutory duration of terms, number of effective members, date of the first
appointment and date of term of mandate of each member.
According to the Statutes of the Company, the supervision of the Company will be made by an Audit
Committee and an Auditor. The Audit Committee is composed of three effective members and one
replacement. The mandate of the members of governing bodies lasts for four years, and the re-election
is allowed for one or more times.
In a Shareholder General Meeting held on the 13th of February of 2012, the following members were
elected to be part of the Audit Committee for the period 2012/2015:
Name
Date of first election Date of term of
mandate
13-Nov-2008
31-Dec-2015
29-Feb-2008
31-Dec-2015
29-Feb-2008
31-Dec-2015
José Augusto dos Santos Saraiva (*)
13-Nov-2014
31-Dec-2015
(*) Following the resignation of José Manuel Taveira dos Santos from the position of substitute
member of the Audit Committee of FC Porto - Futebol, SAD, was elected at the General Meeting of
November 13, 2014, José Augusto dos Santos Saraiva to the respective position.
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32. Identification of the independent members of the Audit Committee, according to art. 414, n. 5
of the CSC
As stated by the members, the regulations for incompatibility and independence criteria foreseen in
n. 1 or article 414 A and n. 5 of article 414, respectively, both part of the Portuguese Companies Code,
apply.
33. Professional qualifications of each member of the audit Committee and other relevant
information
• Degree in Economics from the Faculdade de Economia do Porto
• Business Activity:
1982/1984
Technical Sales Department at the Banco Português do Atlântico.
1984/2005
Director of the Company Sofite - Sociedade Industrial de Fibras Têxteis, SA.
1984/2004
Managing Partner of the ATM - Gabinete de Gestão, Lda.
1990/2000
Manager of the Gorem - Sociedade Técnica de Serviços, Lda.
1991/1993
Director of Risfomento - Sociedade de Fomento Empresarial, SA.
1994/2014
Managing Partner of TRL - Têxteis em Rede, Lda.
1994/2011
Managing Partner of Expomoda – Têxteis e Representações, Lda.
2002/2004
Managing Partner of Ninfamar - Indústria de Confecções, Lda.
2010/2013
Managing Partner of Hot Pink – Comércio, Lda.
• Corporate Activity:
1986/1996
Vice-Chairman of ANJE - Associação Nacional de Jovens Empresários.
1991/1994
Director of APET – Associação Portuguesa dos Exportadores de Têxteis.
1994/2003
Vice-Chairman of the General Council of the ATP – Associação Portuguesa de Têxteis e Vestuário.
1996/2000
Member of the Economic and Social Council.
1996/2002
Chairman of the General Meeting of ANJE – Associação Nacional de Jovens Empresários.
1996/2011
Vice-chairman of the Board of Sport Club do Porto.
1997/2001
Director of the Associação Comercial do Porto – Câmara de Comércio e Indústria do Porto.
1997/2002
Member of the National Commission for Monitoring the IMIT – Iniciativa para a Modernização da
Indústria Têxtil.
1999/2014
Member of the Executive Committee of the project Portugal Fashion.
2001/2003
Member of the Audit Committee of MTV – Movimento do Têxtil e do Vestuário.
2002/2006
Chairman of the General Office of the Associação Gabinete de Desporto do Porto.
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2003/2008
Chairman of the Board of ATP – Associação Têxtil e Vestuário de Portugal.
2004/2008
Vice-Chairman of the Board of CIP – Confederação da Indústria Portuguesa.
2004/2010
Member of the Monitoring Committee of Prime – Programa de Incentivos à Modernização da
Economia.
Since 2004
Chairman of the General Meeting of AAJUDE – Associação de Apoio à Juventude Deficiente.
2005/2008
Member of the General Council and the Board of Directors of AEP – Associação Empresarial de
Portugal
Since 2005
Chairman of the Audit Committee ofAssociação Fórum Manufuture Portugal
2007/2013
Chairman of the General Council of PortoLazer – Empresa Municipal
Since 2007
Member of the Advisory Board of Fundação da Juventude.
2007/ 2008
Vice-Chairman of the Supervisory Board of Futebol Clube do Porto
2008/2014
Vice-Chairman of General Board and Board of Directors of AEP – Associação Empresarial de
Portugal.
2008/2013
Chairman of the Board of EURISKO Estudos, Projectos e Consultoria, S.A.
Since 2008
Member of the Board of Associação para a Feira Internacional do Porto – Exponor
2008/2015
Vice-Chairman of the Board of Europarque – Centro Económico e Social
Since 2008
Chairman of General Board of Exponor Brasil – Feiras e Eventos, Lda.
Since 2008
Chairman of the Board of CESAE – Centro de Serviços e Apoio às Empresas
Since 2008
Chairman of the Audit Committee of Futebol Clube do Porto, da Futebol Clube do Porto – Futebol,
SAD, da Porto Estádio – Gestão e Exploração de Equipamentos Desportivos, S.A. and Euroantas – Promoção e
Gestão de Empreendimentos Imobiliários, S.A.
Since 2009
Chairman of the Board of Directors of Fundação AEP
2010/2015
Chairman of the Audit Committee of ATP – Associação Têxtil e Vestuário de Portugal
2011/2013
Chairman of the Audit Committee of Futebol Clube do Porto – Basquetebol, SAD.
Since 2011
Vice-Chairman of the General Board of CIP – Confederação Empresarial de Portugal
Since 2011
Chairman of the General Meeting of AGAVI – Associação para a Promoção das Gastronomia, Vinhos,
Produtos Regionais e Biodiversidade
Since 2012
Chairman of the General Meeting of Paredes Industrial- Parques Industriais, S.A.
Chairman of the General Meeting of Tirso Parques – Parques Empresariais de Santo Tirso, S.A.
Chairman of the General Meeting of Parque-Invest – Sociedade Promotora de Parques Industriais, SA., among
others.
Since 2013
Vice-Chairman of CCIAP – Câmara de Comércio e Indústria Árabe-Portuguesa.
Since 2014
Chairman of the General Meeting of Delegação Regional Norte da DECO
Since 2014
Chairman of the General Board and the Board of Directors of AEP – Associação Empresarial de
Portugal.
Since 2015
Chairman of the Board of Europarque – Centro Económico e Social
Other positions referred in point 36.
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• Executive MBA - European Management (IESF / IFG), completed in 1996
• Degree in Economics from the Faculdade de Economia do Porto, completed in 1978
• Degree in Accounting (former ICP and current ISCAP), 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 as head of the department North Executive Operation.
• Certified Public Accountant since 1972
• Statutory Auditor, individually, since 1989
• Statutory Auditor, integrated in Sociedade Santos Carvalho & Associados, SROC, SA from 1989 to 2010
• Statutory Auditor, integrated in Sociedade Armando Magalhães, Carlos Silva & Associados, SROC, Lda., since 2010
• Other positions held referred to in point 36.
• Degree in Law at the Faculdade de Direito de Coimbra, in 1996
• 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
• Postgraduate in European Studies at the Centro de Estudos Europeus da Faculdade de Direito de Coimbra, concluded
in 1997
• Accounting Course for Lawyers and Engineers at Universidade Católica Portuguesa, concluded in 1998
• Attendance of Graduate Public Law - The New Legal Director, Universidade Católica Portuguesa, during 2002/2003
• Attendance of Postgraduate in “The New Code for Public Contracts” at Escola de Direito of Universidade Católica
Portuguesa (Porto), 2009/2010
• Training in Specialization in “Public Contracts, Assessment of Propositions in Tender Procedures”, at Faculdade de
Direito of Universidade de Coimbra (CEDIPRE), 2009/2010
• Postgraduate in “Direiro das Empresas”, by the Faculdade de Direito da Universidade de Coimbra, 2015 (attendance);
• Practiced as a lawyer in a law firm in Porto (February to April 1999)
• Practiced as a lawyer in law firm in Macau (Drª Manuela António) from April 1999 to April 2001;
• Practiced as a lawyer in a law firm in Porto (in his own name and as a collaborator/associate of the Company of
Advocates Cerqueira Gomes & Associados) from 2001 to 2009;
• Lawyer of Câmara Municipal do Porto from March 2003 to June 2004;
• Associate Attorney of Cuatrecasas, Gonçalves Pereira & Associates (from 2009 to 2013);
• Associate of Cuatrecasas, Gonçalves Pereira & Associados (2014);
• Instructor of the Law Bar, District Center of Porto, in the module “Company Law” (2006/2011);
• Instructor of Course for Expert Evaluators, organized by the Centro de Estudos Judiciários, 2009 Edition;
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• Trainer at Cuatrecasas, Gonçalves Pereira in Escola de Direito of Universidade Católica Portuguesa (Porto), for the
seminars on Public Law, since 2010;
• Member of Editorial Board for Legal Area of Editora Brasileira Juruá;
• Member of União Internacional dos Advogados (UIA);
• Member of the Board of Comité Português da UIA since 2012;
• Vice-Chairman of the Conselho de Justiça of the Federação Portuguesa de Ténis since 2012;
• Degree in Economia, by the Faculdade de Economia da Universidade do Porto (1982/3)
• Degree in Finanças in the Escola Prática de Administração Militar (1983)
• Auditor (Nº 25239)
• Trainer, Monitor and certified programmer (CAP EDF1202/98 DN; CCPFC/RFO-10585/00)
• HSaW Technician (Certificate n. 83/2015)
• From June 2012 to September 2015 – Member of the Board of IDARN, representing AEP,
• Since March 2012 – Member of the Board of APCER-Certificação SA, representing AEP
• From March2012 to May 2014 – Assistant of the Board of Directors of AEP,
• Since November 1995 – Admnistrative, Financial and Maintenance Coordenator CESAE,
• From October 1985 to October 1995 – Senior Official Economist and trainer / Coordenator of the IT Management
Department of CESAI.
• From January 1985 to September 1985 – Senior Official Economist CICCOPN,
• From August 1983 to October 1984 – Aspiriring Militiaman Official – Economist EPAM and UGF of the Região Militar
Centro QG-BAS Coimbra,
b) Functioning
34. Existence and location where the regulations for the functioning of the Audit Committee may be
consulted
The Governing Bodies of FC Porto – Futebol, SAD do not have formally approved functioning
regulations. However, the members intend to set those regulations and disclose them afterwards in
the website of Futebol Clube do Porto (www.fcporto.pt).
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35. Number of meetings held and attendance of each member of the Audit Committee to the
meetings
In this period, the Audit Committee met 4 times, and a minute was made for each meeting. These are
available to any Governing Body who wishes to consult them. All members of the Board attended all
the meetings.
36. Availability of each member of the Audit Committee indicating the positions held simultaneously
with other companies, in and out of the Group, and other relevant activities held by the members
of those Bodies during this period
• Chairman of the General Assembly of AAJUDE - Associação de Apoio à Juventude Deficiente
• Chairman of the Audit Committee of the Associação Fórum Manufuture Portugal
• Member of the Advisory Board of Fundação da Juventude
• Vice-Chairman of the General Council and the Board of Directors of AEP - Associação Empresarial de Portugal
• Chairman of the General Council of Fundação AEP
• Chairman of the Board of Europarque - Económico e Social
• Chairman of the General Council of Exponor Brazil - Feiras e Eventos, Lda
• Chairman of the Board of CESAE - Centro de Serviços e Apoio às Empresas
• Vice-Chairman of the General Board of CIP – Confederação Empresarial de Portugal
• Chairman of the General Meeting of AGAVI – Associação para a Promoção das Gastronomia, Vinhos, Produtos Regionais e
Biodiversidade
• Chairman of the General Meeting of Paredes Industrial - Parques Industriais, SA
• Chairman of the General Meeting of Tirso Parques – Parques Empresariais de Santo Tirso, SA
• Chairman of the General Meeting of Parque-Invest – Sociedade Promotora de Parques Industriais, SA
• Chairman of the Audit Committee of Futebol Clube do Porto
• Chairman of the Audit Committee of PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, SA
• Chairman of the Audit Committee of EuroAntas, Promoção e Gestão de Empreendimentos Imobiliários, SA
• Chairman of the General Meeting of Delegação Regional Norte da DECO.
• Vice-Chairman of CCIAP – Câmara de Comércio e Indústria Árabe-Portuguesa.
• Member of the Audit Committee of Sonaecom, SGPS, SA
• Member of the Audit Committee of the Fundação Eça de Queiroz
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• Account Rapporteur of the Audit Committee of Futebol Clube do Porto
• Member of the Audit Committee of Real Vida Seguros, SA
• Member of the Audit Committee of Sonae Investimentos SGPS, SA
• Member of the Audit Committee of Companhia de Seguros Caravela
• Chairman of the Board of CPC ÁFRICA, SA
• Member of the Audit Committee of Futebol Clube do Porto
• Member of the Audit Committee of PortoComercial, Sociedade de Comercialização, Licenciamento e Sponsorização, SA
• Chairman of the General Meeting of Ach Brito & CA, SA
• Chairman of the General Meeting of Saboaria e Perfumaria Confiança, SA
• Chairman of the General Meeting of Companhia Portuguesa de Computadores e Sistemas de Informação, SA
• Chairman of the Audit Committee of IDARN, representing AEP,
• Chairman of the Audit Committee of ADDICT, representing AEP,
• Former Chairman of the Audit Committee of Comissão de Melhoramentos de Figueiró da Serra, IPSS,
• Member of the Audit Committee of Associação dos Parques e Exposições do Norte-EXPONOR, representing AEP,
• Substitute Member of the Audit Committee of FCP Futebol SAD
• Member of the Audit Committee of CERTIF, representing AEP,
• Member of the Audit Committee of Escola de Gestão Empresarial, representing AEP,
• Member of the Audit Committee of Fundação AEP, representing AEP,
• Member of the Audit Committee of DragonTour SA,
• Member of the Audit Committee of Futebol Clube do Porto Serviços Partilhados SA,
• Member of the Audit Committee of EuroAntas SA e Porto Estádio SA,
• Rapporteur of the Audit Committee of FC Porto,
• Trainer/Consultant/ Freelance Economist.
c) Competences and duties
37. Description of the procedures and applicable criteria for the intervention of the supervision body
to contract the additional services of an external auditor
The Audit Committee, whenever appropriate, meets with the External Auditor not only in its own name
but also in that of the Company, pursuant to its powers. It is not under his role, however, to propose
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the provider of the External Audit, given his recruitment precedes the appointment of a separate Audit
Committee of the Statutory Auditors. The external auditing services have been analysed independently
and standing by the supervisory board, issuing an annual opinion on the activity of the Auditor during
the year and making mention of any facts that could hinder the continuity of the office for just cause.
The Audit Committee is, along with the Board of Directors, the first recipient of the reports issued by
the external audit firm.
As for other work carried out by the external auditor, different from audit, related to the validation of
financial nature so that the Group may play in competitions organized by LPFP, since the engagement
of Deloitte proved to be the most appropriate, considering the light of its solid experience and
knowledge of the operation and accounts of the Group, the Audit Committee reviewed and approved
the scope of those services and concluded that they did not affect the independence of the external
auditor.
38. Other duties of the supervision body
The Audit Committee must supervise the activity of the company, confirming the compliance of the
law and statutes. As a result, the Audit Committee shall, on an annual basis, create a report on the
activities developed, stating any incompliance verified, and issue an opinion on the documents of
accountability and on the proposed appropriation of results, presented by the Board to the General
Meeting. This report is available for consultancy on the website of the Company, and on the website
of CMVM, together with the documents of accountability.
The annual reports on the activity of the Audit Committee are disclosed on the website of the
Company, together with the documents of accountability.
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, ensure there are, 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.
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IV. Statutory Auditor
39. Identification of the statutory auditor and its representative
The position of Statutory Auditors of the Company is held by the Accounting Company Deloitte &
Associados, Sociedade de Revisores Oficiais de Contas, based in Edifício Atrium Saldanha, Praça Duque
de Saldanha, 1 - 6º 1050-094 Lisboa, registered in Ordem dos Revisores Oficiais de Contas with the
number 43 and with the CMVM under number 231, represented by António Manuel Martins Amaral
(ROC n. 1130).
40. Indication of how long the statutory auditor has been working with the company and/or group
Deloitte & Associados, SROC, S.A. has been responsible for the statutory audits of the Company and
the companies in the Group since 2004, through its representative António Manuel Martins Amaral
since 2011.
41. Description of other services carried out by the Statutory Auditor to the company
The statutory auditor is also the external auditor of the Company, as detailed below.
V. EXTERNAL AUDITOR
42. Identification of the external auditor appointed under art. 8 and the statutory auditor
representative in those duties, and number of registration in the CMVM
The external auditor of the Company, appointed under art. 8 of the CVM, is Deloitte & Associados,
SROC, S.A., registered under the number 231 in the CMVM, represented by António Manuel Martins
Amaral.
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43. Indication of how long the statutory auditor has been working with the company and/or group
The statutory auditor was elected for the first time in 2004 and is now on its third mandate, through
its representative António Manuel Martins Amaral since 2011.
44. Policy and frequency of rotation of the external auditor and its representative in its duties
The company has not set a period of rotation for the external auditor. However, the accounting
company has their own internal regulations, which demand the rotation of the external auditor every
seven years. This method has the full support of the Board of FC Porto – Futebol, SAD and its Audit
Committee.
45. Indication of the body responsible for the evaluation of the external auditor and frequency of
evaluation
The Audit Committee, in the function of its duties, ensures an annual evaluation of the independence
of the External Auditor. Additionally, the Audit Committee promotes, whenever possible or fitting for
the activity of the Company of the general market, an analysis on the adequacy of the External Auditor
to the exercise of its duties.
46. Identification of works, apart from audits, done by the external auditor, as well as indication of
internal procedures for the effects of approval in contracting such services and indication of reason
to the contracting
Other services done by the external auditor in 2014/2015 included those regarding the validation of
financial assumptions, so that the Company may play in the competitions organized by LPFP. Other
services are provided by different technicians involved in the audit procedure, which implies the
independence of the auditor.
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The Audit Committee analysed and approved the services mentioned, concluding that they did not
question the independence of the External Auditor. On that consideration, the decision to contract
Deloitte proved to be optimal, due to their consolidated experience and knowledge in the operation
and accounting of the Company.
47. Indication of the amount in annual remuneration paid to the auditor and to other employees
belonging to the same network and indication of the percentages belonging to each service:
By the Company*
€
%
Services for account audit (€) [€/%]
47,000
47%
Services for compliance assessment (€) [€/%]
10,000
10%
Services for tax consulting (€)[€/%]
0%
Other services unrelated to accounting (€) [€/%]
0%
By entities part of the group*
Services for account audit (€) [€/%]
42,000
42%
Services for compliance assessment (€) [€/%]
0%
Services for tax consulting (€) [€/%]
0%
Other services unrelated to accounting (€) [€/%]
0%
TOTAL
99,000
100%
C. INTERNAL ORGANIZATION
I. Statutes
48. Applicable regulation to the change in statutes of the Company
As line b) of article 23, n. 2 of Decree n. 10/2013, of January 25 goes into effect, FC Porto no longer
has, by Law, the right to veto over the change in statutes of FC Porto SAD, and so the regulation set by
the Portuguese Companies Code will apply on this matter.
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II. Communication of irregularities
49. Means and policy to communicate irregularities occurring in the company
Although the policy statement of internal irregularities is not formally defined, considering the
proximity of the members of the Board to the activities of the Company and its employees, FC Porto Futebol, SAD considers that such proximity allows the communication of whichever irregularities may
appear to the Board, ensuring the implementation of procedures aimed at dealing effectively and fairly
with any irregularities detected. At the level of expertise in evaluating ethical issues and the structure
and governance of the company, these functions are performed directly by the Board, specifically by
the administrator responsible for the legal department, which maintains a constant debate on the
issue.
The staff of FC Porto – Futebol, SAD must report to the legal department, or to the director in charge,
any irregular practices detected or suspected, in order to prevent or stop irregularities that may be
cause damages to the financial health of the company or to its honour. This report must be done in
writing and describe all the existing elements and information necessary to the assessment of the
irregularity; a first approach to the report may be done directly or by phone.
The communication of irregularities in the Company have ensured confidentiality and its sequel by any
preliminary investigation of the responsibility of those who, to this end, will be designated by the
concerning director.
III. 2.1. Internal control and risk management system
50. Persons, bodies or committees responsible for the internal audit and/or implementation of
internal control
The Internal Audit department is the department responsible for the internal control of the Company.
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51. Description of the hierarchical and/or functional dependence relations with other bodies or
committees of the company
Both the Internal Audit and Compliance and the Management Planning and Control depend of the
Board of Directors.
The Audit Committee has no responsibility in the creation and functioning of the internal control
systems, but takes into consideration its existence and efficacy when assessing the risks to the
company.
52. Other functional areas with competences in risk control
There is also a Management Planning and Control department with the main intent of supporting the
administration in the detection of relevant financial risks, which means analysing periodically the
information related to financial planning and control, such as the business plan, the operation budgets
and treasury and its control, management indicators, among others. These procedures are designed
to help in the quality of the information disclosed to the market.
53. Identification and description of the main types of risk (economic, financial and legal) to which
the company is expose in its activity
The Board of Administration considers that FC Porto – Futebol, SAD is exposed to risks inherent to its
activity. Thus, the main financial risks the company believes to be subjected to are: market risk (interest
rate risk and currency risk), credit risk, liquidity risk, regulation risk (Financial Fair Play) and sporting
risk. The control mechanisms of these risks are described in the attachment regarding financial
demonstrations.
Apart from the financial risk, the activity of the company is also very reliant of the sporting
performance of the main football team. The sporting success is a key factor to obtain the traditional
revenues and to the value of its assets, as they represent invaluable gains to the company due to
transfers.
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54. Description of the process of risk identification, evaluation, accompaniment, control and
management
The administration and supervising bodies of the company have been giving growing importance to
the development and improvement of the internal control and risk management systems, concerning
the operational, economic and financial aspects with a relevant impact to the activities of the group,
as recommended by national and international experts, including the CMVM.
Thus, for the financial year of 2010/2011, a department of Internal Audit has been created, developing
its activity in assessing the efficiency and efficacy of the internal control system and the business
procedures concerning the entire group, independently and systematically, in examining and
evaluating the rigour, quality and application of the operational, accounting and financial controls,
promoting an effective control at a reasonable cost and proposing measures that present themselves
as necessary to prevent possible deficiencies in the internal control system. Its function also includes
assuring the full compliance with legislation and regulations affecting the organization.
The department for Internal Audit has set an annual plan where it was determined the audits that
should be carried out in order to assess the quality of the control processes that certify the compliance
of the objectives of the Internal Control System, namely those that certify the operation efficiency, the
reliability of the financial and operational reports and the compliance with laws and regulations. The
failures in the internal control will be reported to the upper rank and the most severe to the Board of
Directors.
55. Main elements in the internal control and risk management systems implemented in the
company regarding the process of disclosing financial information
Regarding the risk control in financial reporting process, only a very limited number of collaborators of
FC Porto - Futebol, SAD is involved in the financial reporting process.
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All those involved in the financial analysis of the Company are deemed to have access to privileged
information and to be particularly aware of their obligations and the sanctions resulting from the
misuse of such information.
The system of internal control in the areas of accounting and preparation and report of financial
information is based on the following key elements:
•
The use of accounting principles, detailed throughout the notes to the financial statements,
constitutes one of the bases of the control system;
•
The plans, procedures and records of the Company and its subsidiaries enable reasonable
assurance that only properly authorized transactions are recorded and that these transactions
are recorded in accordance with generally accepted accounting principles;
•
Financial information is analysed, in a systematic and orderly manner, by the management of
operating units, ensuring ongoing monitoring and the respective budgetary control;
•
During the process of preparing and reviewing financial information, a schedule of closing
accounts is provided in advance and shared with the different areas involved, and all
documents are reviewed in depth;
•
As for individual financial statements of the various companies in the group, the accounting
records and the preparation of financial statements are provided by administrative and
accounting services. The financial statements are prepared by statutory auditors and reviewed
by the financial management;
•
The consolidated financial statements are prepared quarterly by the consolidation team. This
process represents an additional control element of the reliability of financial reporting,
namely ensuring the uniform application of accounting principles and procedures of cutting
operations as well as the verification of balances and transactions between companies in the
group;
•
The consolidated financial statements are prepared under the supervision of the CFO. The
documents forming the annual report are sent for review and approval by the Board of
Directors. After approval, the documents are sent to the External Auditor, which emits its Legal
Certification of Accounts and the Audit Report; and
•
The process of preparing the individual and consolidated financial information and the
Management Report is supervised by the Audit Committee and the Board of Directors. On a
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quarterly basis, these bodies gather and analyse the individual and consolidated financial
statements of the Company.
Concerning risk factors that may materially affect the accounting and financial reporting, we
emphasize the use of accounting estimates that are based on the best information available at the
date of preparation of the financial statements as well as the knowledge and experience of past and /
or present events. We emphasize also the balances and transactions with related parties: in the group
FC Porto, balances and transactions with related parties mainly refer to current operating activities of
the companies in the group, as well as the granting and obtaining of loans bearing interest at market
rates.
The Board, in conjunction with the Audit Committee, regularly examines and supervises the
preparation and disclosure of financial information, in order to circumvent the access, improper and
untimely, of third parties, to relevant information.
IV. Support to the Investor
56. Service responsible for investor relations, composition, functions, information provided by these
services and elements for contact
The representative of FC Porto - Futebol, SAD for relations with the capital market is the main contact
for all investors, institutional and private, national and international.
This representative ensures the provision of all relevant information regarding relevant events,
applicable facts and relevant facts, disclosure of quarterly results and answer to any clarification
requests by investors or the general public about financial information of a public nature. He is also
responsible for all matters pertaining to the relationship with the Committee on Securities Market, to
ensure the timely fulfilment of obligations to the supervisory authority of capital and other financial
authorities. He is also responsible for developing and maintaining the webpage for Investor Relations
in the website of the Company.
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For the exercise of his duties, the address, phone and fax number and e-mail of the representative for
market relations are the following:
Address: Estádio do Dragão, Via FC Porto, Entrada Poente, piso 3,
4350-451 Porto
Phone: 22 5070500
Telefax: 22.5506931
E-Mail: [email protected]
57. Representative for market relations
The current representative of FC Porto - Futebol, SAD for market relations Fernando Manuel Santos
Gomes, member of the Board of Directors.
58. Information on proportion and response time to information requests received during the year
or outstanding from previous years
When necessary, the representative of market relations ensures the provision of all relevant
information regarding relevant events, applicable facts and relevant facts, disclosure of quarterly
results and answer to any clarification requests by investors or the general public about financial
information of a public nature. All information requested by investors is analysed and answered in a
maximum of five working days.
V. Website
59. Addresses(s)
FC Porto - Futebol, SAD has an internet website (www.fcporto.pt) with a wide range of information
about the Group. The aim is to provide to interested parties a general knowledge of the Group, its
business areas, information of institutional and financial nature. In the webpage dedicated to Investor
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Relations, there is frequent presentation of results, documents of accountability, information on
General Meetings of shareholders, including summons and supporting documentation, and
information of institutional nature, namely the Statutes and the identification of Governing Bodies. It
is also possible to consult qualified holdings, all the privileged information and other communications
issued by the Company as well as the minutes of the General Meetings since 2009.
60. Address where information about the firm, its listed company, registered office and other
elements mentioned in Article 171 of the Companies Act can be found
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/futebol-clube-do-porto-futebol-sad.aspx#ancora_topo
61. Address with the statutes and regulations of the functioning of the bodies and/or commissions
62. Address with information about the identity of the corporate officers, the representative for
market relations, the Office for Support to the Investor or equivalent, respective roles structure and
means of access
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/contactos.aspx#ancora_topo
63. Address with accountability documents, which must be accessible for at least five years, as well
as the biannual calendar of corporate events, at the beginning of each semester, including, among
others, general meetings, disclosure of annual, semi-annual and, if applicable, quarterly accounts
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/r-c-2013-2014.aspx#ancora_topo
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/calendario.aspx#ancora_topo
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64. Address with the summon for a General Meeting and all the preparatory and subsequent
information related to it
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/ag-2014.aspx#ancora_topo
65. Address with the historical record of resolutions approved at general meetings of the company,
the represented share capital and the voting results, with reference to the previous 3 years
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/ag-2014.aspx#ancora_topo
D. REMUNERATIONS
I. Competence for determination
66. Indication as to the competence to determine the remuneration of corporate bodies
The body responsible for conducting the performance evaluation of Executive Directors for the
purpose of remuneration is the Remuneration Committee, which follows the criteria it sees fit in every
moment, complying with legal and statutory standards.
II. Remuneration Committee
67. Composition of the Remuneration Committee, including identification of contracted individual
or collective persons to provide them support and statement on the independence of each of the
members and advisors
The current Remuneration Committee of FC Porto - Futebol, SAD (from 2012 to 2015) is composed of
the following members:
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•
Alípio Dias (Chairman)
•
Fernando Freire de Sousa
•
Joaquim Manuel Machado Faria de Almeida
The Remuneration Committee is composed of independent members from the Board. To this extent,
the Remuneration Committee does not include any member of another corporate body to which it
sets its remuneration, and none of the three members in office has any family relationship with other
members of these governing bodies, as their spouses or relatives in a straight line to the 3rd degree.
During the financial year of 2014/2015, the Remuneration Committee did not deem as necessary
contracting services to assist in carrying out its functions.
68. Knowledge and experience of the members of the remuneration committee on remuneration
policy
The members of the Remuneration Committee have knowledge and experience in matters of
remuneration policy.
FC Porto - Futebol, SAD believes that the experience and professional careers of the members of the
Remuneration Committee allow them to perform their duties accurately and efficiently. Additionally,
whenever necessary, that committee will recur to specialized resources, internal or external, to
support their decisions.
III. Remuneration structure
69. Description of the remuneration policy of the management and supervisory bodies referred to
in Article 2 of Decree n. 28/2009, of June 19
As stipulated in Decree n. 28/2009, of June 19, there is an annual submission to the General Assembly
of a statement on the remuneration policy of the management and supervision bodies.
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The policy on remuneration and compensation of corporate bodies of FC Porto - Futebol, SAD,
approved by the General Assembly on November 13 2014, is as follows:
The Remuneration Committee, which is responsible for setting the remuneration policy of the Board of Directors,
submits to the General Assembly the following statement of principles:
•
Members of the Board of Directors should perform their duties diligently and prudently in the interests
of the company, taking into account the interests of its shareholders, employees and other
stakeholders;
•
It is the interest of the company and its shareholders to set a remuneration policy that creates adequate
conditions and procedures to allow the performance of the members of the Board of Directors to align
with the criteria previously defined;
•
The performance and setting should consider, first, the level of compensation currently practiced, and,
secondly, must be conditioned by the degree of achievement of the strategic objectives for the
company.
Taking into account the principles listed above, the Remuneration Committee proposes to the General Meeting
a remuneration model based on a fixed monthly component and possible also fixed annual bonuses, which will
ensure a remuneration that rewards Executive Directors for the performance of the Company. At the beginning
of each term (every 4 years), the Compensation Committee establishes the general parameters of remuneration
of the Board of Directors, with the aim of making it more competitive in the market and serve as a motivating
element for high individual and collective performance.
The Remuneration Committee considers that the remuneration of the executive members of the Board of
Directors of the Company shall be fixed in the month of June each year with effect staring on the following month
of July, taking into account the sporting results achieved. The executive members of the Board of Directors of
the Company may also be assigned fixed annual bonuses. The remunerations of members of the board are not
dependent on the evolution of the price of the issued shares or of any other variable, including the profits made
each year.
The Remuneration Committee also intends to point out to shareholders that there is no type of plan of attribution
of shares or acquirement of shares to the Directors. Likewise, there is no policy or measure defined in the sense
of granting compensation negotiated by contract, in the event of termination of service or early retirement.
Beyond any fixed annual bonus, there are no explicit premiums or non-cash benefits.
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Regarding the Company of Statutory Auditors of the Company, their remuneration is made through the contract
for provision of audit services to the Group Futebol Clube do Porto, which covers nearly all of its subsidiaries.
The planned remuneration is in line with market practices.
Members of other corporate bodies: the General Meeting, Audit Board, Company Secretary; Advisory Board and
Remuneration Committee are not remunerated for these duties at FC Porto - Futebol, SAD.
70. Information on how remuneration is structured so as to align the interests of members of the
board with the long-term interests of company, as well as on how it is based on performance
assessment and how it discourages taking extreme risks
The remuneration policy for executive directors intends to ensure proper and rigorous consideration
of the performance and contribution of each director to the organization's success, by aligning the
interests of executive directors with those of shareholders and the Company.
Proposals for remuneration of executive directors are made, taking into account the functions
performed at FC Porto - Futebol, SAD and in its different subsidiaries; responsibility and added value
by individual performance; knowledge and experience gained on the job; the financial position of the
Company; the remuneration in companies of the same sector and other companies listed on NYSE
Euronext Lisbon. Regarding the latter point, the Remuneration Committee takes into account the limits
of available information, all national companies of equivalent size, namely listed on the NYSE Euronext
Lisbon, and also companies in international markets with characteristics equivalent to FC Porto Futebol, SAD.
The setting of remunerations also takes into account the long-term performance of the group,
compliance with the rules applicable to its business, the restraint in taking risks and market knowledge.
71. Reference to the existence of a variable remuneration component and information about
possible impact of performance evaluation on this component
The remuneration of the members of the Board of Directors of the company has not foreseen for the
existence of variable components.
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72. Deferment of payment of the variable remuneration component, specifying the period of
deferment
The remuneration of the members of the Board of Directors of the company does not foresee the
existence of variable components.
73. Criteria followed when setting the variable remuneration in shares
existence of variable components. There was no sort of plan to attribute shares or allow for the
acquisition of shares to the Directors.
74. Criteria followed when setting the variable remuneration in options
existence of variable components. There was no sort of plan to attribute shares or allow for the
acquisition of shares to the Directors.
75. Main parameters and grounds for any system of annual bonuses and other non-cash benefits
FC Porto - Futebol, SAD does not have any system of annual bonuses or other non-cash benefits.
76. Main features of supplementary pension or early retirement plans for directors and date they
were approved in general meeting, in individual terms
The Company has not established any plans to attribute shares or allow for the acquisition of shares
or retirement benefit systems options, to members of the board of directors, and, as such, they were
never brought to the attention of the General Assembly.
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IV. Disclosure of remunerations
77. Indication of the annual amount of the remuneration, in aggregate and individually, of the
members of the management bodies of the company, coming from the company, including fixed and
variable remuneration and, for the latter, mentioning the different components that led to it
The remunerations attributed to the Board of FC Porto – Futebol, SAD during this financial year reached
1.381.000 euros and are fully paid.
The gross earnings in the year in question, by all the members of the board, relates exclusively to the
executive directors.
Director
Fix
Prizes
520,000
0
287,000
0
287,000
0
287,000
0
0
0
78. Amounts paid by other companies in dominion or group, or which are subject to a common
domain
The members of the Board of Directors are not remunerated by other companies in the group or by
companies controlled by shareholders with qualified holdings.
79. Remuneration paid in the form of profit sharing and/or payment of premiums and the reasons
why these bonuses or profit sharing were granted
During the exercise, no remunerations were paid by way of profit sharing or in the form of prizes.
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80. Compensation paid or owed to former executive directors leaving their duties during the year
During the exercise, no amounts were paid or owed relating to compensation to directors whose
functions have ceased.
81. Indication of the annual amount of remuneration, in aggregate and individually, of members of
the supervision bodies of the company
Members of the Audit Board are not remunerated for these duties at FC Porto - Futebol, SAD.
82. Details on the remuneration in the reference year of the chairman of the general meeting
The Chairman of the General Assembly is not paid for these duties at FC Porto - Futebol, SAD.
V. Agreements with implications on remunerations
83. Contractual limitations provided for compensation payable for unfair dismissal of directors and
its relation with the variable remuneration component
The remuneration policy maintains the principle of not contemplating compensations to directors, or
members of other governing bodies, associated with the early termination of duties or the expiry of
their terms, subject to compliance by the Company with legal provisions in force in this field.
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84. Reference to the existence and description, indicating the sums involved, of agreements
between the company and members of the board of directors and managers, under the terms of
paragraph 3 of article 248-B of the Portuguese Securities Code, which provide for compensation in
case of dismissal without cause or termination of contract following a change of control of the
company
There are no agreements between the Company and members of the board of directors or other
managers of FC Porto - Futebol, SAD, within the meaning of paragraph 3 of article 248-B of the
Portuguese Securities Code, which provide for compensation in case of resignation, unfair dismissal or
termination of contract following a change of control of the Company. No agreements are foreseen
with the directors to ensure any compensation in the event of non-renewal of the mandate.
VI. Plans to attribute shares or allow for the acquisition of shares (‘stock options’)
85. Identification of the plan and its recipients
The Company does not have in place any kind of Plans to attribute shares or allow for the acquisition
of shares to members of governing bodies or employees.
86. Characterization of the plan
The Company does not have in place any kind of Plans to attribute shares or allow for the acquisition
of shares.
87. Option rights attributable to the acquisition of shares ('stock options') to workers and employees
of the company
There are no option rights granted for the acquisition of shares to workers and employees of the
company.
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88. Control mechanisms in any possible system of employee participation in capital to the extent
that the voting rights are not exercised directly by them
Not applicable as explained above.
E. TRANSACTIONS BETWEEN RELATED PARTIES
I. Control mechanisms and procedures
89. Mechanisms implemented by the Company for purposes of monitoring of transactions with
related parties
Currently, there are no established procedures or criteria to define the relevant level of significance
in business between the Company and the holders of qualifying holdings or entities who are with
them in any relationship or group, from which the intervention is required of the supervisory board.
90. Indication of the transactions that were subject to control in the reference year
No businesses or significant transactions between the Company and members of its governing bodies
(administration and supervision), holders of qualified shareholdings or companies in a control or
dominion or group were performed, except those part of the current activity, and that were carried
out under normal market conditions for similar transactions. There were no business transactions
with members of the Audit Committee. The services rendered by the Statutory Auditors of the
various audit services were approved by the Audit Committee and are detailed in paragraph 47
above.
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91. Description of the procedures and criteria for intervention by the supervision body for the
purpose of preliminary assessment of the business carried out between the company and holders of
qualifying holdings or entities that are related to them
In addition to the legal requirements applicable to the activities of the Audit Committee, there were
no additional mechanisms established by the company for the purpose of preliminary assessment of
conducting business between the Company and holders of qualifying holdings or entities that are
related to them, in accordance with Article 20 of the Securities Code.
II. Business related elements
92. Indication of the location of accounting documents where information about the business with
related parties is made available
Information on the business with related parties, for the period of 2014/2015, can be found in Note
30 of the attachment to consolidated financial statements and Note 26 of the Attachment to the
individual accounts of the Company.
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PART II – EVALUATION OF THE CORPORATE GOVERNANCE
1. Identification of the code of corporate governance adopted
This report was prepared in accordance with CMVM Regulation n. 4/2013, of August 1 and the Code
of Corporate Governance, available at www.cmvm.pt, and to summarize the key aspects of Company
management, regarding the Board of Directors, taking into account the need for transparency on this
matter and the need for communication with investors and other stakeholders. The reporting model
adopted by the Company is stipulated by paragraph 4 of Article 1 of that Regulation and Annex I
thereto.
The report meets the standards of Article 245-A of the Portuguese Securities Code and discloses, to
the principle comply or explain, the degree of compliance with the CMVM Recommendations included
in the 2013 CMVM Code of Corporate Governance.
The duties of disclosure required by Decree 28/2009 of 19th of June, by Articles 447 and 448 of the
Commercial Companies Code and CMVM Regulation n. 5/2008, dated October 2 2008 are also met.
2. Analysis of compliance with the Code of Corporate Governance adopted
FC Porto - Futebol, SAD complies with most of the CMVM recommendations relating to Corporate
Governance as follows:
CMVM CORPORATE GOVERNANCE RECOMMENDATIONS
I. VOTING AND CORPORATE CONTROL
I.1. Companies shall encourage shareholders to attend and vote at general
meetings and shall not set an excessively large number of shares required for the
entitlement of one vote, and implement the means necessary to exercise the right
to vote by mail and electronically.
I.2. Companies shall not adopt mechanisms that hinder the passing of resolutions
by shareholders, including fixing a quorum for resolutions greater than that
provided for by law.
I.3. Companies shall not establish mechanisms intended to cause mismatching
between the right to receive dividends or the subscription of new securities and
DEGREE OF
COMPLIANCE
REPORT
Adopted
Part I / B / I. /
b) / 12, 13
and 14
Adopted
Part I / B / I. /
b) / 13 and 14
Adopted
Part I / B / I. /
b) / 12 and 13
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the voting right of each common share, unless duly justified in terms of long-term
interests of shareholders.
I.4. The company’s articles of association that provide for the restriction of the
number of votes that may be held or exercised by a sole shareholder, either
individually or in concert with other shareholders, shall also foresee for a
resolution
by the General Assembly (5 year intervals), on whether that statutory provision is
to be amended or prevails – without super quorum requirements as to the one
legally in force – and that in said resolution, all votes issued be counted, without
applying said restriction.
I.5. Measures that require payment or assumption of fees by the company in the
event of change of control or change in the composition of the Board and that
which appear likely to impair the free transfer of shares and free assessment by
shareholders of the performance of Board members, shall not be adopted.
II. SUPERVISION, MANAGEMENT AND OVERSIGHT
II.1. SUPERVISION AND MANAGEMENT
II.1.1. Within the limits established by law, and except for the small size of the
company, the board of directors shall delegate the daily management of the
company and said delegated powers shall be identified in the Annual Report on
Corporate Governance.
II.1.2. The Board of Directors shall ensure that the company acts in accordance
with its objectives and shall not delegate its responsibilities as regards the
following: i) define the strategy and general policies of the company, ii) define
business structure of the group iii) decisions considered strategic due to the
amount, risk and particular characteristics involved.
II.1.3. The General and Supervisory Board, in addition to its supervisory duties
supervision, shall take full responsibility at corporate governance level, whereby
through the statutory provision or by equivalent means, shall enshrine the
requirement for this body to decide on the strategy and major policies of the
company, the definition of the corporate structure of the group and the decisions
that shall be considered strategic due to the amount or risk involved. This body
shall also assess compliance with the strategic plan and the implementation of key
policies of the company.
II.1.4. Except for small-sized companies, the Board of Directors and the General
and Supervisory Board, depending on the model adopted, shall create the
necessary committees in order to:
a) Ensure a competent and independent assessment of the performance of the
executive directors and its own overall performance, as well as of other
committees;
b) Reflect on the system structure and governance practices adopted, verify its
efficiency and propose to the competent bodies, measures to be implemented
with a view to their improvement.
II.1.5. The Board of Directors or the General and Supervisory Board, depending on
the applicable model, should set goals in terms of risk-taking and create systems
for their control to ensure that the risks effectively incurred are consistent with
those goals.
II.1.6. The Board of Directors shall include a number of non-executive members
ensuring effective monitoring, supervision and assessment of the activity of the
remaining members of the board.
II.1.7. Non-executive members shall include an appropriate number of
independent members, taking into account the adopted governance model, the
size of the company, its shareholder structure and the relevant free float. The
independence of the members of the General and Supervisory Board and
members of the Audit Committee shall be assessed as per the law in force. The
other members of the Board of Directors are considered independent if the
member is not associated with any specific group of interests in the company nor
is under any circumstance likely to affect an exempt analysis or decision,
particularly due to:
Not adopted
Part I / B / I. /
b) / 13 and 14
Adopted
Part I / A / I. /
2, 4, 5 and 6
Not adopted
Part II / 2 and
Part I / B / II. /
a) / 21
Adopted
Part I / B / II. /
a) / 21
Not applicable
Not adopted
Part II / 2 and
Part I / B / II. /
c) / 29
Not adopted
Part II / 2 and
Part I / C / III.
/ 52, 54 and
55
Part I / B / II. /
a) / 18
Not adopted
Not adopted
Part II / 2 and
Part I / B / II. /
a) / 18
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a. Having been an employee at the company or at a company holding a
controlling or group relationship within the last three years;
b. Having, in the past three years, provided services or established commercial
relationship with the company or company with which it is in a control or group
relationship, either directly or as a partner, board member, manager or director
of a legal person;
c. Being paid by the company or by a company with which it is in a control or
group relationship besides the remuneration arising from the exercise of the
functions of a board member;
d. Living with a partner or a spouse, relative or any first degree next of kin and up
to and including the third degree of collateral affinity of board members or
natural persons that are direct and indirectly holders of qualifying holdings;
e. Being a qualifying shareholder or representative of a qualifying shareholder.
II.1.8. When board members that carry out executive duties are requested by
other board members, said shall provide the information requested, in a timely
and appropriate manner to the request.
II.1.9. The Chairman of the Executive Board or of the Executive Committee shall
submit, as applicable, to the Chair of the Board of Directors, the Chair of the
Supervisory Board, the Chair of the Audit Committee, the Chair of the General
and
Supervisory Board and the Chairman of the Financial Matters Board, the
convening notices and minutes of the relevant meetings.
II.1.10. If the chairman of the board of directors carries out executive duties, said
body shall appoint, from among its members, an independent member to
ensure the coordination of the work of other non-executive members and the
conditions so that said can make independent and informed decisions or to
ensure the existence of an equivalent mechanism for such coordination.
II.2. SUPERVISION
II.2.1. Depending on the applicable model, the Chair of the Supervisory Board, the
Audit Committee or the Financial Matters Committee shall be independent in
accordance with the applicable legal standard, and have the necessary skills to
carry out their relevant duties.
II.2.2. The supervisory body shall be the main representative of the external
auditor and the first recipient of the relevant reports, and is responsible, inter alia,
for proposing the relevant remuneration and ensuring that the proper conditions
for the provision of services are provided within the company.
II.2.3. The supervisory board shall assess the external auditor on an annual basis
and propose to the competent body its dismissal or termination of the contract as
to the provision of their services when there is a valid basis for said dismissal.
II.2.4. The supervisory board shall assess the functioning of the internal control
systems and risk management and propose adjustments as may be deemed
necessary.
II.2.5. The Audit Committee, the General and Supervisory Board and the
Supervisory Board decide on the work plans and resources concerning the internal
audit services and services that ensure compliance with the rules applicable to the
company (compliance services), and should be recipients of reports made by
these services at least when it concerns matters related to accountability,
identification or resolution of conflicts of interest and detection of potential
improprieties.
II.3. REMUNERATION SETTING
II.3.1. All members of the Remuneration Committee or equivalent should be
independent from the executive board members and include at least one member
with knowledge and experience in matters of remuneration policy.
II.3.2. Any natural or legal person that provides or has provided services in the
past three years, to any structure under the board of directors, the board of
directors of the company itself or who has a current relationship with the
company or consultant of the company, shall not be hired to assist the
Remuneration Committee in the performance of their duties. This
Adopted
Part I / B / II. /
a) / 18
Adopted
Part I / B / II. /
a) / 18 and
Part I / B / II. /
b) / 23
Not adopted
Part II / 2 and
Part I / B / II. /
a) / 18
Adopted
Part I / B / III.
/ a) / 32 and
I.A.II.8
Not adopted
Part I / B / III.
/ c) / 38
Adopted
Part I / B / V.
/ 45
Not adopted
Part I / B / III.
/ c) / 38
Not adopted
Part I / C / III.
/ 50
Not adopted
Part I / D / II.
/ 67 and 68
Adopted
Part I / D / II.
/ 67
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recommendation also applies to any natural or legal person that is related by
employment contract or provision of services with the above.
II.3.3. A statement on the remuneration policy of the management and
supervisory bodies referred to in Article 2 of Law No. 28/2009 of 19 June, shall
also contain the following:
a) Identification and details of the criteria for determining the remuneration paid
to the members of the governing bodies ;
b) Information regarding the maximum potential, in individual terms, and the
maximum potential, in aggregate form, to be paid to members of corporate
bodies, and identify the circumstances whereby these maximum amounts may be
payable;
d) Information regarding the enforceability or unenforceability of payments for
the dismissal or termination of appointment of board members.
II.3.4. Approval of plans for the allotment of shares and/or options to acquire
shares or based on share price variation to board members shall be submitted to
the General Meeting. The proposal shall contain all the necessary information in
order to correctly assess said plan.
II.3.5. Approval of any retirement benefit scheme established for members of
corporate members shall be submitted to the General Meeting. The proposal
shall contain all the necessary information in order to correctly assess said system.
III. REMUNERATION
III.1. The remuneration of the executive members of the board shall be based on
actual performance and shall discourage taking on excessive risk-taking.
III.2. The remuneration of non-executive board members and the remuneration of
the members of the supervisory board shall not include any component whose
value depends on the performance of the company or of its value.
III.3. The variable component of remuneration shall be reasonable overall in
relation to the fixed component of the remuneration and maximum limits should
be set for all components.
III.4. A significant part of the variable remuneration should be deferred for a
period not less than three years, and the right of way payment shall depend on
the continued positive performance of the company during that period.
III.5. Members of the Board of Directors shall not enter into contracts with the
company or with third parties which intend to mitigate the risk inherent to
remuneration variability set by the company.
III.6. Executive board members shall maintain the company's shares that were
allotted by virtue of variable remuneration schemes, up to twice the value of the
total annual remuneration, except for those that need to be sold for paying taxes
on the gains of said shares, until the end of their mandate.
III.7. When the variable remuneration includes the allocation of options, the
beginning of the exercise period shall be deferred for a period not less than three
years.
III.8. When the removal of board member is not due to serious breach of their
duties nor to their unfitness for the normal exercise of their functions but is yet
due on inadequate performance, the company shall be endowed with the
adequate and necessary legal instruments so that any damages or compensation,
beyond that which is legally due, is unenforceable.
IV. AUDITING
IV.1. The external auditor shall, within the scope of its duties, verify the
implementation of remuneration policies and systems of the corporate bodies as
well as the efficiency and effectiveness of the internal control mechanisms and
report any shortcomings to the supervisory body of the company.
IV.2. The company or any entity with which it maintains a control relationship
shall not engage the external auditor or any entity with which it finds itself in a
group relationship or that incorporates the same network, for services other
than audit services. If there are reasons for hiring such services - which must be
approved by the supervisory board and explained in its Annual Report on
Adopted
Part I / D / III.
/ 69
Not applicable
Part I / D / III.
/ 73 and 74
Not applicable
Part I / D / III.
/ 76
Adopted
Part I / D / III.
/ 70
Part I / D / III.
/ 69 and Part I
/ D / IV. / 78,
81 and 82
Part I / D / III.
/ 69
Adopted
Not applicable
Not applicable
Part I / D / III.
/ 69
Adopted
Part I / D / III.
/ 71
Not applicable
Part I / D / III.
/ 73 and 74
Not applicable
Part I / D / III.
/ 74
Adopted
Part I / D / III.
/ 69 and Part I
/ D / V. / 83
Adopted
Part I / B / III.
/ c) / 38
Adopted
Part I / D / IV.
/ 41 and Part I
/ D / V. / 47
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Corporate Governance - said should not exceed more than 30% of the total value
of services rendered to the company.
IV.3. Companies shall support auditor rotation after two or three terms whether
four or three years, respectively. Its continuance beyond this period must be
based on a specific opinion of the supervisory board that explicitly considers the
conditions of auditor’s independence and the benefits and costs of its
replacement.
V. CONFLICTS OF INTEREST AND RELATED PARTY TRANSACTIONS
V.1. The company's business with holders of qualifying holdings or entities with
which they are in any type of relationship pursuant to article 20 of the
Portuguese Securities Code, shall be conducted during normal market conditions.
V.2. The supervisory or oversight board shall establish procedures and criteria that
are required to define the relevant level of significance of business with holders of
qualifying holdings - or entities with which they are in any of the relationships
described in article 20/1 of the Portuguese Securities Code – thus significant
relevant business is dependent upon prior opinion of that body.
VI. INFORMATION
VI.1. Companies shall provide, via their websites in both the Portuguese and
English languages, access to information on their progress as regards the
economic, financial and governance state of play.
VI.2. Companies shall ensure the existence of an investor support and market
liaison office, which responds to requests from investors in a timely fashion and a
record of the submitted requests and their processing, shall be kept.
Adopted
Part I / D / V.
/ 44
Adopted
Part I / E / I. /
90
Not adopted
Part II / 2 and
Part I / E / I. /
91
Adopted
Part I / C / V.
/ 59 to 65
Adopted
Part I / C / IV.
/ 56 to 58
Recommendations I.4., II.1.1., II.1.4., II.1.5., II.1.6, II.1.7., II.1.10., II.2.2., II.2.4., II.2.5., II.3.1. e V.2. are
not fully adopted by FC Porto – Futebol, SAD, as explained below.
•
Recommendation I.4.: For the purpose of exercising the right to vote, each share corresponds
to one vote, and the presence at the General Meeting is not conditioned on holding a minimum
number of shares. However, under the terms of line 3 of Article 7 of the statutes of FC Porto Futebol, SAD, the votes of shareholders of the Group who hold preferential shares without
voting rights that may confer voting rights, pursuant to Article 342, n. 3 of the Commercial
Companies Code, shall not be considered during the period in which they can exercise their
right to vote if their share in the total capital exceed more than one third of all the votes
attached to the capital of FC Porto - Futebol, SAD. There is no provision in the Company's
statutes any maintenance or modification of this statutory provision to the General Meeting.
•
Recommendation II.1.1.: The directors of FC Porto – Futebol, SAD focus their activity in the
management of participations of the Group and in the definition of strategic development
lines. The decisions regarding strategic and relevant matters are adopted by the Board of
Directors as a composed college body by all members, executive and non-executive, in the
normal performance of their duties. Additionally, some of the directors of the Company are in
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the Board of Directors of other operational units in the Group, which means the
recommendation is not fully followed.
•
Recommendation II.1.4.: FC Porto – Futebol, SAD believes that, given its size, the only
indispensable specialized commission to the needs of the Company in the Remuneration
Committee, not presenting any committees with the specific purpose of identifying candidates
to directors and to reflect on the adopted governing system, for which the recommendation
cannot be considered adopted.
•
Recommendation II.1.5.: In this report, there is a description of the most important aspects in
the risk management that were implemented in the Group. However, FC Porto – Futebol, SAD
does not have a system for internal control and risk management to include all the
components foreseen in that type of system, for which the recommendation is not fully
adopted.
•
Recommendation II.1.6.: FC Porto - Futebol, SAD does not meet the II.1.6 recommendation,
which recommends that the Board of Directors includes a number of non-executive members
to ensure effective monitoring capacity, supervision and evaluation of the activities of other
members of the management body. Although the Group understands that, given its small size
and the fact that its executive members are very competent in the management of the group,
the existence of a non-executive director ensures the efficient supervision, auditing and
assessment of activities of non-executive members, it is the understanding of CMVM that, to
comply with this recommendation, at least one third of the total number of directors shall be
non-executive.
•
Recommendations II.1.7. and II.1.10.: the members of the Board of Directors are not
independent, with the exception of Rui Ferreira Vieira de Sá, as all are part of the Board of
Futebol Clube do Porto, holder of around 75% of the capital, and 62% of the voting rights, of
Futebol Clube do Porto – Futebol, SAD, having a dominant influence over it. Rui Ferreira Vieira
de Sá is in the Board of Directors of Somague Engenharia, SA, which is owned 100% by
Somague, S.G.P.S., S.A., which in turn is owned 100% by Sacyr SYV, a company that owned
18,79% of the social capital of Futebol Clube do Porto – Futebol, SAD, until October 2014.
Considering the company model adopted and the composition and functioning of its governing
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2014/2015
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bodies, namely the independence of audit bodies, without any delegation of competence
between that or any other committees, the Group believes that appointing independent
directors would not add any benefits to the proper functioning of the model adopted, which
has been proving to be adequate and efficient.
•
Recommendation II.2.2.: The recommendation has not been fully complied with, as the reports
issued by the external auditor have the first recipient the Supervisory Board, together with the
Board of Directors. However, FC Porto - Futebol, SAD believes that this procedure does not
affect the criterion of independence and conflict of interest, since the external auditor's report
is not influenced or changed depending on the presentation to the Board of Directors.
•
Recommendation II.2.4.: Even if the Audit Committee does not have any responsibilities in the
creation and functioning of internal control systems, it does take into consideration their
existence and efficiency when analysing the risks to the Company.
•
Recommendation II.2.5.: Given that the Internal Audit and Planning and Management Control
departments depend on the Board of Directors, this recommendation is considered not met.
However, in spite of the Supervisory Board does not take responsibility in the creation and
operation of internal control systems, it takes into account their existence and effectiveness
during the examination of the risks of the group.
•
Recommendation II.3.1.: The recommendation has not been fully complied with since two of
the members of the Remuneration Committee have positions in the structure of the majority
shareholder of the company. However, since both are non-executive in Futebol Clube do
Porto, with up to one of only advisory positions, FC Porto - Futebol, SAD considers that the
accuracy and impartiality of this body is not questionable.
•
Recommendation V.2.: Currently, there are no procedures or criteria regarding the definition
of relevant level of significance of businesses between the Company and holders of qualified
participations, or entities that are under any type of dominion or group, for which it would be
required an intervention of the audit body. However, the transactions with directors of FC
Porto – Futebol, SAD, or with companies related to the group or dominion represented by the
director, regardless of the amount, should be previously cleared by the Board of Directors,
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2014/2015
___________________________________________________________________________________________
properly accepted by the audit body, under the terms of art. 397 of the Portuguese Companies
Code.
3. Other information
Futebol Clube do Porto – Futebol, SAD believes that, despite the only partial compliance with the
recommendations of CMVM, as explained above, the degree of adoption if still wide and complete.
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2014/2015
___________________________________________________________________________________________
D. Shares held by members of the Board of Directors and Advisory Council
Board of Directors
On June 30, 2014, had 250.000 shares. Has not acquired or alienated any share since, and, as of June
30 2015, had 250.000 shares. Futebol Clube do Porto, of which he is Chairman of the Board, had, on
June 30 2015, 9.282.931 shares.
No shares held. Futebol Clube do Porto, of which he is Vice-Chairman of the Board, held, on June 30
2015, 9.282.931 shares.
No shares held. Futebol Clube do Porto, of which he is Vice-Chairman of the Board, held, on June 30
2015, 9.282.931 shares.
Reinaldo da Costa Teles Pinheiro
On June 30, 2014, had 9.850 shares. Has not acquired or alienated any share since, and, as of June 30
2015, had 9.850 shares. Futebol Clube do Porto, of which he is Vice-Chairman of the Board, held, on
June 30 2015, 9.282.931 shares.
No shares held
Audit Committee
Had 100 shares as of June 30 2014. Has not acquired or alienated any share since, and, as of June 30
2015, had 100 shares.
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2014/2015
___________________________________________________________________________________________
No shares held.
Had 10 shares as of June 30 2014. Has not acquired or alienated any share since, and, as of June 30
2015, had 10 shares.
No shares held.
Statutory Auditors
Deloitte & Associados, SROC S.A. represented by António Manuel Martins Amaral
No shares held.
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154

Annual Report 2014-2015

Transcription

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