2015 Annual Report

Transcription

2015 Annual Report

MANAGEMENT REPORT
01 MARTIFER GROUP
Message from the Board
Highlights
Key Financial Indicators
Main Events
02 GUIDELINES
Activity
International Presence
History
Market Environment
03 FINANCIAL PERFORMANCE
Consolidated Result Analysis
Revenues
EBITDA and Net Profit
Consolidated Capex
Consolidated Capital Structure Analysis
04 ANALYSIS BY SEGMENT
Metallic Constructions
RE Developer
Solar
05 INDIVIDUAL FINANCIAL INFORMATION
06 MARTIFER SHARE PERFORMANCE
07 FUTURE PROSPECTS
08 MAIN RISKS
Financial Risks
Operational Risks
Legal Risks
09 PROPOSAL OF RESULTS ALLOCATION
10 OTHER INFORMATION
MANDATORY INFORMATION
CONSOLIDATED FINANCIAL INFORMATION
11 CONSOLIDATED FINANCIAL STATEMENTS
12 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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 ANNUAL REPORT 2015 
INDIVIDUAL FINANCIAL INFORMATION
13 INDIVIDUAL FINANCIAL STATEMENTS
14 NOTES TO INDIVIDUAL FINANCIAL STATEMENTS
CORPORATE GOVERNANCE REPORT
AUDIT AND FISCAL REPORTS
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This translation into English of the Portuguese document was done only for the convenience of non-Portuguese speaking shareholders. For all intents and
purposes, the Portuguese version shall prevail.
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01
01 | MARTIFER GROUP
MESSAGE FROM THE BOARD
Dear Shareholders,
2015 was especially demanding due to the difficult conditions of the world economy and, in particular, in the construction sector, but
was also quite positive for Martifer, which was able to increase its turnover comparing with the previous year in around 17 %, a
significant recovery in the operational performance, with a positive EBITDA of around 11.4 million euros and a positive net profit for
the period of 1.2 million euros (including non-controlling interests).
We were also able to achieve the main goals in the execution of the 2015 Action Plan, namely the conclusion of the financial
restructuring process, the improvement of processes and operational efficiency and the reorganization of the international presence.
We carried on with the sale of non-core assets, having materialized the sale of real estate assets in Portugal and in Poland and the
process of sale of the construction sector in Brazil.
The conclusion of the financial restructuring, with the agreement reached with the main financial institutions allowed us, among
other goals, to significantly reduce the financing cost and to increase the average maturity of the debt (to around eight years), as
well as to reinforce the permanent capital structure.
In the metallic constructions area:
 We reinforced the operational capacity in West Sea (the naval shipyard in Viana do Castelo);
 We advanced towards an ownership structure simplification through the merger of several companies.
In the Renewables area:
 We concluded the sale of the Gizalki wind farm, in Poland, to Ikea Group.
Following the steps taken in 2014 and 2015, in 2016 we will continue focused on the main goals defined in the Group’s strategy:
 Reinforcement of the international presence;
 Focus on the metallic constructions’, the naval industry’s and the renewables’ (through asset rotation) core businesses;
 Consolidation of the adopted organizational model, keeping the focus on:




Resizing and readapting the structure, aligning it with the reinforcement of the international presence;
Improvement of the business processes and operational efficiency;
Development and retention of human resources;
Optimization of the industrial footprint and adjustment of production layouts;
 Improvement of the Group’s financial situation:



Divestment in non-core businesses and sale of real estate assets;
Reduction of cash costs, through a program for the optimization of the cost structure and the working capital;
Gradual decrease of the net debt and the debt/EBITDA ratio.
th
We would also like to highlight that in 2015 Martifer celebrated its 25 anniversary, a milestone that makes us proud, especially its
founders.
Lastly, we would like to thank our employees and co-workers for their commitment and on whom we continue to count on to achieve
the defined goals, and all our stakeholders for their support and trust.
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HIGHLIGHTS

Total Revenues of 253 M€, of which 238 M€ in Metallic Constructions and 14 M€ in
Renewables

Total Revenues in the 4Q2015 with a 23 % growth YoY

Significant recovery in the operational performance, with a positive EBITDA in around
11.4 M€

Positive Net Profit in 1.2 M€, including non-controlling interests

Order Book in Metallic Constructions registers a 6.5 % YTD growth to 262 M€

Net Debt with a 23 M€ decrease compared with Dec. 2014, on a comparable basis
(meaning, without Solar) to 260 M€
MAIN FINANCIAL INDICATORS
M€
Revenues
EBITDA
DEC-15
DEC-14
VAR.%
252.6
225.8
12%
11.4
6.0
90%
EBITDA Margin
4.5%
2.7%
1.9 pp
Depreciation & Amortization
-12.0
-14.6
18%
Provisions & Impairment Losses
0.1
-38.6
n.m.
-0.5
-47.3
99%
-0.2%
-20.9%
20.7 pp
Financial Results
3.0
-19.4
n.m.
Profit before taxes
2.5
-66.7
n.m.
-0.5
-4.9
89%
EBIT
EBIT Margin
Income tax
Profit after taxes on continued operations
Discontinued operations’ Result
Attributable to non-controlling interests
Attributable to shareholders
Net Profit
Earnings per share
2.0
-71.5
n.m.
-0.8
-65.2
99%
0.2
-34.4
n.m.
-1.0
-30.7
97%
1.2
-136.7
n.m.
1.7
-43.2
n.m.
-0.5
-93.5
99%
-0.005
-0.957
99%
 MARTIFER GROUP 
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1
2015
11
253
15
-137
2014
6
226
10
-71
2013
16
320
-200
-100
0
Capex
100
Net Profit
EBITDA
200
300
400
Revenues
MAIN EVENTS
JANUARY 2015
West Sea signs the second shipbuilding contract
West Sea and Scenic Tours signed a contract for the construction of a ship hotel, Scenic Azure. Around 80 meters long, the new
ship will cruise in the Douro River and should be completed by February 2016.
APRIL 2015
Martifer Metallic Constructions was awarded a project in the transport sector in Latin
America
Martifer Metallic Constructions was awarded the execution of the structural steelwork for the Bello Monte Station of Caracas’
Underground, in Venezuela. The project was concluded by the end of 2015.
MAY 2015
Martifer, SGPS, SA Annual General Meeting
th
On 14 May 2015, the annual meeting of Martifer SGPS, S.A. took place, with a participation of 80.38 % of its total share capital,
and all the proposals on the Agenda present in the Call Notice were approved by unanimity.
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JULY 2015
West Sea enters a contract for the construction of two Offshore Patrol Vessels
West Sea was awarded in Consortium with the company EDISOFT, S.A. the construction of two Offshore Patrol Vessels for the
Portuguese Navy for an overall price of 77 million euros, net of VAT. West Sea holds an 83.64 % share in the Consortium. The
enforceability of the contract entered into between the Portuguese Government and the Consortium was subject to the approval of
the Portuguese Court of Auditors.
SEPTEMBER 2015
Martifer reaches an agreement for the sale of the construction segment in Brazil
Following Martifer Group’s restructuring plan, it reached an agreement with a group of investors for the execution of the disposal of
the totality of its shares and transfer of its responsibilities of its Brazilian subsidiaries in the construction segment, Martifer
Construções Brasil Ltda and Martifer Alumínios Brasil Ltda. The operation implies a null impact in Martifer Group’s projected 'Free
Cash Flow to Equity’. The Group will continue to be present in Brazil in the renewable energy segment.
th
The sale agreement was signed in September, being released only on 24 October, after the confirmation of the registry of the
operation by the Brazilian authorities.
OCTOBER 2015
Ventinveste reaches agreement for the sale of wind farms
Ventinveste, a company owned in partnership by Martifer and Galp Energia, has reached an agreement with EDP Renováveis for
the sale of five companies’ holding licenses and interconnection rights corresponding to a total of 216.4 MW of wind energy
capacity, for a reference price of around 17 million euros. Completion of this transaction is subject to approval from administrative
and competition authorities in Portugal.
NOVEMBER 2015
Martifer Renewables concludes agreement for the sale of wind farm
Martifer Renewables concluded the agreement for the sale of the Gizalki wind farm to Ikea Group. This agreement was signed on
July 2014 and has been pending on the completion and grid connection of the wind farm.
DECEMBER 2015
Martifer reaches an agreement for financial restructuring
Following the priorities defined in the restructuring plan, Martifer reached an agreement with a group of creditor financial institutions
for the restructuring of Financial Debt in the Holding and in the construction segment perimeters. The global amount of financing to
be restructured reaches around 260 million euros, which corresponds to around 85 % of the Martifer Group’s gross consolidated
th
Financial Debts on 30 September 2015.
 MARTIFER GROUP 
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SUBSEQUENT EVENTS
FEBRUARY 2016
West Sea delivers the first ship built in Viana do Castelo
West Sea delivered the first ship built by the company in Viana do Castelo to Douro Azul in February. Viking Osfrid is a river cruise
ship and was christened in March.
No other facts that affect the released financial information have occurred since the reference date of the results up until the relase
of this report.
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02 | GUIDELINES
ACTIVITY
Martifer began its activity in 1990 in the steel structures sector. Since 2014, as a consequence of the strategic focus of the
business, Martifer has concentrated its operations in the metallic constructions sector.
The Group’ holding, Martifer, SGPS, S.A., also develops other activities and manages financial participations, namely in the
renewables segment, through the promotion and development of wind farms, and in the solar segment, through the 55 % financial
participation in Martifer Solar, considered an asset held for sale since September 2014.
HOLDING
Martifer SGPS, S.A. is the holding company of the Group. With the changes in the governance model implemented in 2012, Martifer
SGPS, S.A. positions itself as a financial holding, establishing and defining rules and policies for the Group and monitoring the
activity of the business areas, which were given a greater degree of independence and power.
The business areas act independently, although they follow the strategic guidelines defined at the holding level, having the annual
budgets and business plans approved by Martifer SGPS, S.A.’s executive board members.
METALLIC CONSTRUCTIONS
Martifer Metallic Constructions, SGPS, S.A., subholding for the Metallic Constructions business segment 75 % owned by Martifer,
SGPS, S.A. is a player with global recognition in the sector. The company (and its subsidiaries) is focused on three major
geographic areas: Europe and the Middle East, Africa and Latin America, and has industrial units that allow it, from those areas, to
build the most complex projects in diversified places such as Jeddah in Saudi Arabia, Djelfa in Algeria, or Lyon in France. Its
industrial units are located in Portugal, in Romania, in Angola, in Mozambique (in partnership) and in Algeria (in partnership).
This business area bases its development strategy on the differentiation of its engineering quality and its vocation for complex projects.
Martifer Metallic Constructions aims to follow a directed strategy, by partnering with companies from complementary segments, which
will allow it not only to offer more complete solutions, but also to gain a greater dimension, especially on the international stage.
It provides global and innovative engineering solutions, namely in the metal mechanical constructions, aluminium and glass
façades, infrastructures for oil & gas and naval industry (via its subsidiaries Navalria and West Sea) segments.
This industrial and commercial activity has a production capacity that allows it to complete projects in several continents and it
employed 1,674 people at the end of 2015.
RENEWABLES
Martifer Renewables, SGPS, S.A., sub holding for the Renewables business sector 100 % owned by Martifer, SGPS, S.A., acts as
a developer of renewable energy, mainly in wind and PV power projects. More than accumulating power in operation, Martifer
Renewables’ strategy is focused on the rigorous use of capital in the development and construction of projects, having implemented
an asset rotation policy in projects under development, construction management, asset management and operation and
maintenance (O&M).
This business area, which had 39 employees at the end of the year, has a wide experience in the development and management of
wind farms and solar PV parks, being present in five countries: Portugal, Spain, Romania, Poland and Brazil. Owning, in total or in
partnership, a portfolio of over 100 MW in operation, Martifer Renewables has already developed and built more than 700 MW in
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different countries, having had as partners, in the latest projects that were sold, relevant companies such as IKEA in Poland and
Banco Santander, CPFL and Tractelbel in Brazil.
In 2015, Martifer Renewables sold the Gizalki project (36 MW) in Poland and agreed to the sale of the Assú (90 MW) and Floresta
(80 MW) projects in Brazil. In Portugal, through its associated Ventinveste, it agreed to the sale of 216 MW to EDP and started,
through the partnership created between Ventinveste and the Ferrostaal Group, the construction of 171.6 MW of wind farms.
SOLAR
Martifer Solar, S.A., 55 % owned by the Martifer Group, currently plays a leading role in the photovoltaic industry because of its
ability to adapt to a fast-moving industry and its proved track record underpinned by cutting-edge technology, advanced technical
qualifications and a skilled and motivated team.
The area’s main activities are project development, installation of EPC (Engineering, Procurement and Construction) projects,
specialized O&M services and distribution via its subsidiary MPrime.
Martifer Solar covers all market segments: ground mounted, rooftop, BIPV, small generation and off-grid solutions.
Operating since 2006, it continues to expand internationally by initiating activity in new countries, being currently present in more
than 20 countries throughout Europe, Africa, Asia, the Middle East, North America and South America. Martifer Solar has
participated in the implementation of more than 670 MW of PV energy worldwide.
The area employed 267 people at end of 2015.
In September 2014, the Group started to classify the solar business unit (Martifer Solar, SA and its subsidiaries) as a non current
asset held for sale. This change resulted from the fact that Martifer SGPS is presently putting into action its plan to sell its economic
interest (currently 55 %) in Martifer Solar.
In summary, the group is currently organized as follows:
METAL MECHANICAL CONSTRUCTION
DEVELOPMENT OF WIND POWER ASSETS
PROJECT DEVELOPMENT
ALUMINIUM AND GLASS
CONSTRUCTION MANAGEMENT
EPC
INFRASTRUCTURES FOR OIL & GAS
TECHNICAL AND OPERATION
MANAGEMENT
PV SOLUTIONS
NAVAL INDUSTRY
DISTRIBUTION
O&M
 GUIDELINES 
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INTERNATIONAL PRESENCE
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HISTORY
1990
In February 1990, Martifer is established as a limited company, with the capital of approximately 22,500 euros (at the time:
4,500 thousand escudos) and is headquartered in the Industrial Zone of Oliveira de Frades, where it continues to be today.
At the end of its first year of activity, Martifer had 18 employees and a turnover of 240,000 euros.
1998
th
On 26 May, the company which already has 100 employees,
is transformed into a Public Limited Company therefore
changing its shareholder structure. The company's capital is
held by MTO SGPS (currently I’M SGPS) and ENGIL SGPS
(currently MOTA-ENGIL SGPS).
In Portugal, Expo 98 takes place with Martifer participating in
several projects, such as the Vasco da Gama Tower.
1999
In November, Martifer begins its internationalisation process in Spain with the objective of becoming one of the reference
companies in metallic constructions in this country.
2002
Martifer builds its second industrial unit in Portugal, located in Benavente, to meet the construction needs for the Euro 2004 stadiums.
2003
In February 2003, Martifer continues with the internationalisation process by building an industrial unit in Gliwice, in Poland. It starts
nd
operating in the 2 half of 2004.
2004
In February, Martifer begins activity in the renewable energy equipment sector, through Martifer Energia. This company dedicates
itself to the manufacturing of metallic towers for wind turbines and is based in the Industrial Zone of Oliveira de Frades.
In November, Martifer SGPS, S.A. is created with the objective to manage the social holdings of all Martifer Group companies.
 GUIDELINES 
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2005
The metallic structures activity widens its market to Central Europe, opening branches in Romania, in the Czech Republic, in Slovakia
and in Germany.
Investments are initiated in the area of Agriculture and Biofuels in Romania.
Martifer becomes one of the reference shareholders of the German company REpower Systems AG, one of the largest producers
worldwide of wind power equipment, ending the year with a financial holding of 25.4 %. In June, REpower Portugal is established,
aimed at the market of building and giving assistance to wind farms and assembling wind turbines.
In August, Martifer Group creates yet another company called M Energy (today, Martifer Renewables) with the main purpose of
centralising the management of all the activities in the area related to the promotion of renewable energy.
2006
In March, through the Ventinveste Consortium, Martifer
submitted its application to the tender for the attribution of
licences for the production of wind power in Portugal.
In May, Martifer Solar is formed with the social object related to the
projecting, design, manufacturing and installation of solar panels.
At the end of the year, Martifer is awarded the 1st prize of
excellence for the promotion of new areas of investment and
business, awarded by the Chamber of Commerce and Industry of Romania.
2007
In February, Martifer, together with the Indian Group Suzlon,
launches a takeover bid on Repower Systems AG. The
consortium takes control of 56.93 % of the company, and,
thanks to an agreement between Areva and Suzlon, the
consortium took control of 87.1 % of the voting rights of
Repower Systems. Martifer agrees to sell its participation in
Repower Systems to Suzlon in 2009 for 270 million euros.
The Ventinveste consortium - formed by Martifer, Galp Energia,
Enersis, Efacec and REpower Systems AG - came in first place in "Phase B" of the public tender launched by the Portuguese
government for the attribution of 400 MW of injection capacity and the respective reception points associated to the production of
electric power in wind farms.
In June, the Initial Public Offer (IPO) for the Company was concluded. The Company received 199 million in funds through the offer of
25 million shares which were placed at the peak of the price range, 8 euros per share. After the IPO, the Company had 65 thousand
new shareholders.
Martifer Solar formalised the contract with Spire Corporation for the turnkey supply of the automated production line of photovoltaic
modules with an annual capacity of 50 MW.
The Group was also awarded "Organic Grower of the Year 2007” by A.T. Kearney’s "Global Growth Assessment”.
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2008
Martifer Energy Systems buys Navalria. The acquisition price
reached 4.7 million Euros.
The Chairman and Vice-Chairman of Martifer, Carlos Martins and
nd
Jorge Martins win the 2 edition of the national award attributed
by Ernst & Young, Entrepreneur of the Year 2007.
The industrial units for the assembly of wind turbines,
components for wind farms and PV modules start producing.
2009
Martifer and Hirschfeld create a Joint Venture for the production of wind energy components in the USA.
The metallic construction plant in Angola (15,000 tonnes of capacity) begins production in the 2
nd
semester of the year.
Martifer Renewables surpasses 100 MW of installed capacity in May and, at the end of the year, it is awarded 217.8 MW in the first
wind power auction held in Brazil.
In October, the Group adopts the new governance model: Carlos Martins takes on the role of Chairman, Jorge Martins becomes
CEO and Mário Couto is appointed CFO.
2010
In March, Martifer sold 11 % of Prio Foods and Prio Energy for
13.75 million euros, thereby reducing its participation from 60 %
to 49 % in these companies and in the respective subsidiaries.
Also in March, the subsidiary Martifer Metallic Constructions
acquired 45 % of the capital of Martifer Alumínios from
HSF SGPS, owning the company's entire capital.
In April, Martifer Solar increased its capital to 50 million Euros
to meet the company's investment needs, thereby strengthening its capital structure.
In September and in October, Martifer Solar finalises the construction of the two largest photovoltaic solar plants in the African
Continent in the islands of Sal and Santiago, in Cape Verde.
At the end of the year and following the asset rotating policy of Martifer Renewables, the Group sold the wind farms held in
Germany, Bippen and Holleben, with 53.1 MW of installed capacity.
Still in December, Martifer Solar signs an agreement with EDP to sell 60 % of Home Energy.
 GUIDELINES 
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2011
Martifer becomes a multinational company with over 3,000
employees worldwide and focused essentially on two business
areas: metallic constructions and solar energy solutions.
This year, the Group increases its exposure to markets outside
Europe with its entry into promising markets. In the metallic
constructions area, the first semester highlights the start of the
construction of a metallic structures plant in one of the markets
with the biggest growth potential in the next years: Brazil. In
solar, we witnessed the awarding of the first photovoltaic solar energy project in India, in June.
In February, and following the strategic guideline of the Group to focus itself on its core activities, Martifer sold its 50 % participation
in REpower Portugal to REpower Systems AG.
2012
2012 is the year of full operation of Martifer Metallic
Constructions’ plant in Brazil. With a capacity to produce 12,000
tons of steel structures per year, this unit aims to respond to the
great projects of the company in Brazil.
Martifer Solar is awarded its first contract in Brazil: a PV installation
with 300 kW in a General Motors plant in Joinville, State of Santa
Catarina. The company also continues its internationalization
process entering Ukraine, Romania and Mexico.
2013
In 2013, Martifer Solar builds Latin America’s largest PV plant
(30 MW) in Mexico. The company was in charge of the
Engineering, Procurement and Construction of the plant and
was also responsible for the O&M services.
Martifer Renewables concluded the third wind farm in Poland
(Rymanów) for Ikea Group. The farm with 26 MW was
inaugurated in June.
In November, following an international public tender, Martifer Energy Systems and Navalria, Martifer Group’s subsidiaries, are
awarded the sub concession of the lands and the infrastructures of Viana do Castelo Shipyard (ENVC).
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2014
In the beginning of the year, Martifer signs the contract for the
subconcession of the lands and the infrastructures of the old
Viana do Castelo Shipyard (ENVC). It is in May that West Sea,
the company created by Martifer to administer the
subconcession, starts operating in Viana do Castelo. At the end
of the year, West Sea signs the first shipbuilding contract.
Also in 2014, Brazil hosts the FIFA World Cup. Martifer Metallic
Constructions participated in the construction of three stadiums:
Arena Fonte Nova (Salvador da Bahía), Arena Castelão (Fortaleza) and Arena da Amazônia (Manaus). Martifer Solar was also
present in this event, with the installation of the PV roof of the Mineirão Stadium, in Belo Horizonte.
2015
It is in 2015 that West Sea signs a contract with the Portuguese
Navy for the construction of two Ocean Patrol Vessels.
In the Renewables sector, the Group concludes and sells its
fourth wind power project in Poland, Gizalki, to Ikea Group, and
signs an agreement for the sale of a 216.4 MW wind portfolio to
EDP Renováveis
.
 GUIDELINES 
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MARKET ENVIRONMENT
GLOBAL ECONOMY
Economic Growth
The projections for global growth aim for a growth in 2016 lesser
than in 2015. In fact, several factors condition the evolution of
global economies. Firstly, the important economic imbalances in
China, which as one of the greatest importing economies
worldwide, affects most economies, where it is visible a downturn
in activity, as a consequence of less investment and consumption.
Secondly, the drop in commodities’ prices, especially energy and
agriculture, affects the economic evolution of clearly exporting
countries (mostly emerging economies) opposed to importing ones
(generally developed economies). Lastly, the divergence in the
direction of monetary policies, on the one hand contractionary in
countries with sustained growth, such as the United States, and on
the other hand expansionist like in the Euro Area and in Japan,
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where the macroeconomic context demands the interference of central banks, for example, in what concerns the goal for inflation –
in both cases, very low or near 0% inflation.
In conclusion, in 2016 all regions and groups of countries should grow; however, less than in 2015.
In fact, the Chinese economy is significantly connected, through the international trade, with the rest of the world. The slowdown in
the Chinese internal activity affects the rhythm of its exports to the rest of the world, as well as its domestic demand for goods and
services, both substantially interacting with the industrial and construction sectors.
The commodities’ prices had an important drop throughout 2015. In
fact, the energy sector registered a drop in prices of more than 30 %,
being the main factors the excess offer registered in the market
which, despite the low prices, did not lead to the expected drop in
production. Adding to this is also the Iranian offer in the market, after
reaching an agreement with the six global powers (USA, Russia,
China, France, the United Kingdom and Germany). As for the
agriculture commodities, these were significantly affected by the
favourable climate conditions which benefited producion, drowning
the market with production surpluses and stocks. Lastly, the industrial
metals also registered in 2015 historically low prices.
In this context of low commodities’ prices, traditionally exporting
emerging economies registered important drops in their income since
they are very dependent on trade, in this case, of raw materials. In
contrast, advanced economies, still recovering from the 2007
financial crisis and traditionally importing, benefited from this
scenario, but not enough to compensate the slowdown registered in
emerging economies.
Advanced economies currently face an important challenge – to
reach the inflation goal. In fact, the European Central Bank and the Bank of Japan implemented strongly expansionist monetary
policies, injecting liquidity in the market in order to stimulate the economies. However, forecasts for inflation remain low and both
currencies have incentives in depreciation against the US Dollar. In turn, the United States grow at a sustained pace and apply
contractionist monetary policies. The divergence in monetary policies stimulates the appreciation of the US Dollar, in this case to
the detriment of the euro.
In summary:
1. Slowdown in the Chinese economic activity impacts global economy.
2. Widespread drop in commodities prices: energy, agriculture and metals.
3. Different impacts of the price drop in traditionally exporting economies vs importing economies.
4. Monetary policies carried out by the European Central Bank aiming to achieve the goal of 2 % inflation – strong liquidity injection
in the interbank market.
5. Reference interest rates for Europe were maintained historically low, as a stimulus to economy by the European Central Bank.
6. Recovery of the growth and employment in Portugal in 2015 and equally optimistic forecasts for 2016.
 GUIDELINES 
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Global Indicators – (2011-2016e)
2011
2012
2013
2014
2015f
2016e
USA
1.8%
2.3%
2.2%
2.4%
2.4%
2.52%
Euro Zone
1.5%
-0.7%
-0.4%
1.4%
1.5%
1.8%
Germany
3.3%
0.7%
0.5%
1.6%
1.5%
1.8%
Portugal
-1.3%
-3.2%
-1.4%
0.9%
1.7%
1.9%
USA
3.1%
2.1%
1.5%
1.6%
0.1%
1.8%
Euro Zone
2.7%
2.5%
1.3%
0.5%
0.0%
0.9%
Germany
2.5%
2.1%
1.6%
0.9%
0.2%
1.0%
Portugal
3.6%
2.8%
0.4%
-0.3%
0.5%
0.7%
GDP, Annual var. %
Inflation, Annual var. %
Unemployment Rate, Annual var. %
USA
8.9%
8.1%
7.4%
6.1%
5.3%
5.0%
Euro Zone
10.2%
11.3%
11.9%
11.6%
12.4%
10.3%
Germany
6.1%
6.8%
5.3%
5.0%
4.6%
6.2%
Portugal
12.7%
15.7%
16.2%
14.1%
12.7%
12.2%
USA
-8.7%
-7.0%
-4.1%
-5.8%
-4.6%
-2.6%
Euro Zone
-4.1%
-3.7%
-3.0%
-2.5%
-1.8%
-1.9%
Germany
-0.8%
0.2%
-0.2%
-0.2%
+0.2%
+0.1%
Portugal
-4.4%
-6.4%
-4.9%
-4.0%
-2.4%
-3.4%
107.4
111.1
110.8
57.3
37.3
40.9
- Fed (Fed Funds)
0.25%
0.25%
0.25%
0.25 %
0.5%
1%
- ECB
1.00%
0.75%
0.25%
0.05%
0.05%
0.0%
- BoE
0.50%
0.50%
0.50%
0.50%
0.50%
0.75%
USA
1.88%
1.76%
3.03%
2.17%
1.80%
1.80%
Euro Zone
1.83%
1.32%
1.93%
0.54%
0.10%
0.20%
United Kingdom
1.98%
1.83%
3.02%
1.76%
1.40%
1.30%
1.30
1.32
1.38
1.2
1.14
1.08
Weight of the Deficit, % GDP
Price of Crude
USD per Barrel
Interest Rates, End of year (%)
Interest Rates
Long-term Interest Rates (10 y Bonds)
Exchange Rates, End of year
EUR/USD
Source: Reuters, IMF reports, OECD, INE, World Bank, European Central Bank
24
02
THE PULSE OF PORTUGAL
The forecasts for the Portuguese economy indicate an optimist path. In fact, after a 0.9 % growth in 2014, it is expected that in 2015
this growth increases to 1.7 % and to 1.9 % in 2016. These forecasts contemplate a significant increase in exports which, following
the trend of resource transfer for sectors exposed to international competition, will contribute, in turn, to the reduction of the
Portuguese external debt.
The increase in private domestic demand also contributes to the acceleration of the Portuguese growth; in fact, as families and
companies continue the deleverage process, they set income free to the sections of private consumption and investment, in this
case fixed capital formation.
According to the Bank of Portugal’s economic bulletin from December 2015, there are several indicators that show the good
Portuguese performance:
‒
Growth in domestic demand and an important slowdown of demand for imported contents;
‒
Increasingly robust contribution of exports for the GDP breakdown;
‒
Significant increase in employment at a moment of strongly contraccionist measures, with the unemployment rate going from
13.4 % to 11.9 % between 2014 and 2015, respectively in comparable periods;
‒
The reduction of indebtedness of the families in percentage of the disposable income, as well as a recovery in the consumption
of durable goods are also indicators of the readjustment in the Portuguese economy. The reduction of interest rates in the
market, reducing the families’ debt service, also contributes to this.
One can observe, in the Euro Area, low or near zero inflation rates, which intensify the deflation threat. In order to comply with the 2 %
inflation rate goal, the European Central Bank will have to apply additional measures – Quantitative Easing. As a consequence of the
important monetary injection, a depreciation of the Euro is forecasted, as well as the maintenance of substantially low reference
interest rates. Therefore, a relatively depreciated Euro may bring additional stimulus to the extra-communitary exports. The low interest
rates stimulate new financing and also benefit the existent financing, with the economic agents being able to dispose income for
consumption or investment.
 GUIDELINES 
25
02
Portugal started the route to recovery, however, the work needs to be kept in order to demonstrate the commitment and
seriousness taken in the fulfilment of the goals set for 2016.
MARKET RISKS AND VOLATILITY
th
In 2015, the main volatility index – VIX INDEX – closed the year reaching 18.2 points, after reaching its top value on 24 August, of
th
40.7 points. The lowest values occurred on 17 July, registering 11.95 points; the average of the index in 2015 was 16.67 points. The
th
index had a relatively stable performance in the first half of the year, with the top peak matching 24 August, known as the “Flash
Crash”, a day when a generalized sell off occurred in the American stock markets, leading to sharp drops in the stock market rates.
VIX INDEX
45
40
35
30
25
20
15
10
5
0
SOURCE: Reuters
26
02
 THESE ARE THE MAIN RISKS IDENTIFIED FOR 2016
a. Failure of the European Central Bank in the combat of the deflation threat, draining the resources.
b. Instability generated by the geopolitical turmoil and terrorist menace in the world and especially in Europe.
c. Slowdown in the Chinese economic activity, which impacts global economy.
d. Brexit and Grexit – terms associated with the probability of the United Kingdom and Greece (respectively) exiting the
European Union.
 GUIDELINES 
27
02
28
03
03 | FINANCIAL PERFORMANCE
INTRODUCTORY NOTE
In September 2014, the Group started to classify the solar business unit (consisting of Martifer Solar, SA and its subsidiaries) as a
non current asset held for sale. This change resulted from the fact that Martifer is presently putting into action its plan to sell its
economic interest (currently 55 %) in Martifer Solar.
Since the requirements of IFRS 5 are fulfilled, the contribution to Martifer’s consolidated results coming from this segment is presented
in an autonomous line in the Consolidated P&L. The contribution of assets and liabilities of the operational unit, classified as held for
st
sale, are also presented in separate lines from the Group’s remaining consolidated assets and liabilities on 31 December 2015.
The breakdown of these contributions is included in the Notes to the Consolidated Financial Statements.
CONSOLIDATED RESULTS ANALYSIS
M€
DEC-15
DEC-14
VAR.%
252.6
225.8
12%
11.4
6.0
90%
EBITDA Margin
4.5%
2.7%
1.9 pp
-12.0
-14.6
18%
Revenues
EBITDA
0.1
-38.6
n.m.
-0.5
-47.3
99%
-0.2%
-20.9%
20.7 pp
Financial Results
3.0
-19.4
n.m.
Profit Before Taxes
2.5
-66.7
n.m.
-0.5
-4.9
89%
EBIT
EBIT Margin
Income Tax
Profit after taxes on continued operations
Discontinued operations’ Result
Net Profit
Earnings per share
30
2.0
-71.5
n.m.
-0.8
-65.2
99%
0.2
-34.4
n.m.
-1.0
-30.7
97%
1.2
-136.7
n.m.
1.7
-43.2
n.m.
-0.5
-93.5
99%
-0.005
-0.957
99%
03
REVENUES
DEC-15
REVENUES
DEC-14
VAR. (%)
M€
WEIGHT
M€
WEIGHT
Martifer Consolidated
252.6
100%
225.8
100%
12%
238.1
94%
200.5
89%
19%
14.0
6%
24.7
11%
-43%
0.5
0%
0.6
0%
-17%
Renewables
Other
In 2015, the Operating Revenues were 12 % higher than in 2014, reaching 253 million euros, of which 238 million euros in metallic
constructions and 14 million euros in renewables.
The Revenues in Renewables, 14 million euros, result from wind farms in operation.
Despite the almost 20 % increase compared to 2014, the revenues in metallic constructions continue to be penalized by the sharp
recession of the construction sector, especially in Europe, which the Group has been trying to counter via internationalization, clearly
turning to emerging countries, which presented themselves as the engine for construction worldwide.
As can be verified in the chart below, Portugal represents only 34 % of the total sales and services rendered, with the remaining 76 %
resulting from four different regions: the European Union (excluding Portugal) – 32 %, Angola – 15 %, Brazil – 9 % and Saudi Arabia – 9 %.
BREAKDOWN OF SALES AND SERVICES RENDERED – 2015 VERSUS 2014
2015
2014
Saudi Arabia
6%
Saudi Arabia
9%
Brazil
9%
Portugal
34%
Portugal
24%
Brazil
25%
Angola
15%
Other
1%
European
Union (other)
32%
Angola
13%
Other
0%
European
Union (other)
32%
 FINANCIAL PERFORMANCE 
31
03
EBITDA AND NET PROFIT
EBITDA
DEC-15
DEC-14
VAR. (%)
M€
MARG.
M€
MARG.
11.4
5%
6.0
3%
90%
9.2
4%
-7.3
-4%
n.m.
2.7
19%
12.9
52%
-79%
Renewables
Other
-0.5
0.4
n.m.
In 2015, the Group’s consolidated EBITDA reflects a significant increase, when compared to 2014, from 6 million euros to
11.4 million euros.
This rise results mainly from the increase of the EBITDA in Metallic Constructions, which at the end of 2015 reached 9.2 million
euros (positive), which compare with 7.3 million euros (negative) in 2014. This improvement is mainly due to the margin obtained in
ongoing projects. In the renewables segment, EBITDA reached 2.7 million euros with a 19 % margin versus a 52 % margin in the
same period of the previous year.
Depreciation & Amortization suffered a decrease in 2015, reaching 12 million euros versus 15 million euros in 2014. Provisions and
impairment losses for fixed assets registered -1.0 million euros (-2.5 million euros in provisions and 2.4 million euros in impairment
losses), which compare with 38.6 million euros in 2014 (36.6 million euros in provisions and 2 million euros in impairment losses for
fixed assets).
Earnings Before Interest and Taxes (EBIT) reached -0.5 million euros, which compares with -47 million euros in 2014.
Net Financial Expenses totalled 3 million euros, comparing with -19 million euros in the previous year. The registered Net Interest
was -7 million euros, net foreign exchange was negative in 1 million euros and Other Net Financial Expenses reached 11 million
euros. The Financial Results were positively affected by the financial restructuring in December.
The Discontinued Operations’ Result (Solar) was -2.2 million euros, which compares with -66.7 million euros in 2014 and
represents a 97 % change. This significant improvement in the result is explained by the increase of revenues and their margin, as
well as by the fact that the 2014 period was affected by a set of non-current events that involved additional costs and high
provisions and impairment losses.
The Net Profit in 2015 was positive in 1.2 million euros, which compares with negative 137 million euros in 2014, with all the
segments contributing positively to this improvement.
Net Profit attributable to shareholders in 2015 was -0.5 million euros, which compares with -94 million euros in 2014.
NET PROFIT
DEC-15
DEC-14
WEIGHT
M€
WEIGHT
1.2
100%
-136.7
100%
n.m.
6.4
544%
-68.4
50%
n.m.
Renewables
3.4
290%
0.6
0%
>100%
Solar (discontinued operation) *
-2.2
-186%
-66.7
49%
97%
Holding, Other and Adjust.
-6.4
-548%
-2.2
2%
<-100%
* Consolidated Net Profit of Martifer Solar (contribution to the Group was -0.8 million euros). The difference is related to the consolidation
adjustments, included in “Others. Holding and Adjust”
32
VAR. (%)
M€
03
CONSOLIDATED CAPEX
The amount of investment in tangible and intangible fixed assets in 2015 was 4.4 million euros, applied equally in the Metallic
Constructions segment (2.3 million euros) and the Renewables segment (2 million euros).
DEC-15
CAPEX
DEC-14
VAR. (%)
M€
WEIGHT
M€
WEIGHT
4.4
19%
15.0
100%
-71%
2.3
10%
13.3
89%
-82%
Renewables
2.0
9%
1.7
11%
18%
Other
0.0
0%
0.0
0%
n.m.
INVESTMENT IN TANGIBLE AND INTANGIBLE FIXED ASSETS 2014 – 2015 (M€)
15
4
2014
2015
33
03
CONSOLIDATED CAPITAL STRUCTURE ANALYSIS
FINANCIAL POSITION
M€
Fixed Assets (including Goodwill)
Other non-current assets
DEC-15
DEC-14
VAR. %
163.0
181.7
-10%
76.0
91.2
-17%
Inventory and Receivables
179.3
188.5
-5%
Cash and cash equivalents
40.6
23.0
76%
Assets held for sale
147.7
148.3
0%
Total Assets
606.7
632.7
-4%
40.0
40.3
-1%
Shareholders Equity
Non-controlling interests
-26.5
-22.9
-16%
Non-controlling interests related with assets held for sale
-1.9
-2.1
9%
Total Equity
11.7
15.3
-24%
Non-current debt and leasings
286.1
229.4
25%
Other non-current liabilities
32.6
36.5
-11%
Current debt and leasings
14.8
76.1
-81%
Other current liabilities
124.6
143.4
-13%
Liabilities related with Assets held for sale
137.0
132.0
4%
Total Liabilities
595.0
617.4
-4%
st
The total assets amounted to 607 million euros (633 million on 31 December 2014), while non-current assets reached 239 million
euros (273 million euros in 2014).
st
st
The total equity on 31 December 2015 recorded 11.7 million euros, which compares with 15.3 million euros on 31 December
2014, with 40 million euros attributable to shareholders, an amount similar to 2014.
st
Due to the reinforcement of the permanent capital, on 31 December 2015 the liquidity ratio recorded 130 % (102 % in 2014) and
the solvency ratio 138 % (103% in 2014).
34
03
NET DEBT
During 2015, the decreasing trend was maintained, in line with the goals set in Martifer Group’s strategic plan. Thus, on
st
31 December 2015, the consolidated Net Debt reached 260 million euros, reflecting a 23 million euro reduction when compared
with the previous year.
M€
RENEWABLES
HOLDING
MARTIFER CONSOLIDATED
Net Debt 2015
96
34
130
260
Net Debt 2014
114
41
128
283
This variation results mainly from the signing of the Group’s financial restructuring contracts that occurred at the end of the year.
TREND OF CONSOLIDATED NET DEBT (M€)
600
500
485
444
400
321
330
377
336
283
300
260
200
100
0
2008
2009
2010
2011
2012
2013
2014
2015
Note: Net Debt = (Borrowings + Financial Leases (+/-) Derivatives – Cash and Cash Equivalents
The Group continues focused on the Net Debt reduction process, so it will continue to be committed in the process of selling non-core
assets: solar segment, wind farms and residually the sale of real estate projects throughout 2016, as defined in Martifer Group’s
restructuring plan.
The agreement signed between Martifer and the credit financial institutions also allowed the adequacy of inflows maturity of the
operational activity and investment (divestment) to the outflows of the financing activity through the rescheduling of the expiration
over time, increasing the average maturity of the debt to make it coincide with the permanence degree of its long term assets, and a
st
maturity that allows the cash surpluses to be sufficient to comply with its responsibilities. Therefore, on 31 December 2015, the
average debt maturity was of around eight years.
This extension of the average debt maturity allowed the adequacy of the capital reimbursement plan to the maturity of the
associated assets, not jeopardizing the commitments from the short term operational activity.
As a consequence of the signature of the restructuring agreements, the standardization of the debt’s amortization profile, the
significant reduction of the financing all-in costs, as well as the reinforcement of the permanent capital structure were also possible.
35
03
36
04
04 | ANALYSIS BY SEGMENT
SECTOR TRENDS
 According to the analysis performed by Euroconstruct, published in December 2015, the sector is forecasted to
register a 3 % growth. A significant improvement in view of the previous forecasts, which expected a growth of only
2.4 %, reinforcing the idea that the situation is sustainably reversing, after seven years of intense recession in the
construction sector.
 The recovery is especially strong in the residential subsector, making evident the massive migratory flow to Europe,
which makes the need and demand for housing grow.
INTERNATIONAL OUTLOOK
 On the other hand, the non-residential sector also expects an optimistic scenario, with forecasted growth, however
less than the residential sector. Negative growth is forecasted in countries like Finland and Sweden.
38
 For the civil engineering subsector, a growth around 3.3 % is also expected in 2016, with highlight for the important
contribution of Eastern Europe, particularly Poland.
04
ACTIVITY
The order book at the end of 2015 reached 262 million euros, spread by several countries.
From the most recent contracts, we highlight the following projects:
• In Portugal, Âncora Project, Faro Airport and Ocean Patrol Vessels
• In France, Paris-Asia Business Centre
• In Angola, several buildings included in the project “Grandes Moagens de Angola”
• In Algeria, Djelfa combined cycle station
• In the United Kingdom, Midland and Liverpool Hospitals
• In Spain, Ilunion Building
ORDER BOOK BY GEOGRAPHY
GEOGRAPHY
Africa
TOTAL (M€)
%
56
21%
Algeria
22
8%
Sub-Saharan Africa
34
13%
27
10%
179
69%
99
38%
Eastern Europe and Middle East
Western Europe
81
31%
262
100%
DEC-15
DEC-14
VAR.%
238.1
200.5
19%
9.2
-7.3
n.m.
3.9%
-3.6%
7.5 pp
Naval Industry
TOTAL
RESULTS
M€
Revenues
EBITDA
EBITDA Margin
-5.9
-6.8
13%
3.3
-37.3
n.m.
EBIT
6.6
-51.4
n.m.
EBIT Margin
2.8%
-25.6%
28.4 pp
Financial Results
0.8
-16.7
n.m.
Profit Before Taxes
7.4
-68.1
n.m.
-1.0
-0.3
<-100%
6.4
-68.4
n.m.
0.3
0.3
4%
6.1
-68.7
n.m.
Income Tax
Net Profit
 ANALYSIS BY SEGMENT 
39
04
The Revenues in the Metallic Constructions segment reached 238.1 million euros in 2015, which represents an around 20 % growth
when compared with 2014, with Portugal representing around 40 % and the remaining 60 % distributed by several geographies,
which shows the Group’s effort in pursuing internationalization and in focusing on countries with economic growth and an
investment plan for infrastructures.
EU (other)
9%
Angola
14%
United
Kingdom
12%
Saudi
Arabia
9%
Brazil
9%
France
6%
Portugal
40%
Other
1%
The EBITDA in 2015 amounted to 9.2 million euros, which compare with -7.3 million euros in 2014, and is the result of an
improvement in margin in projects, especially in markets such as Saudi Arabia.
The EBIT was positive in 6.6 million euros, which compares with the -51 million euros registered in 2014, when it was negatively
affected by provisions and impairment losses for onerous contracts with a significant value.
The Net Financial Expenses (interests and other financial expenses) in 2014 reached -2.3 million euros (meaning, net receipts of
2.3 million euros), benefiting from the impact of the financial restructuring concluded in December.
The Net Profit at the end of 2015 totalled 6.8 million euros (6.1 million euros attributable to shareholders), which compare with -68.4
million euros in 2014.
st
The Net Financial Debt in the Metallic Constructions area on 31 December 2015 reached 96 million euros, 18 million euros less
st
than on 31 December 2014.
The total CAPEX at the end of 2015 reached 2.3 million euros, mostly applied in the reinforcement of the operational capacity in
West Sea (shipyard in Viana do Castelo, Portugal).
40
04
RE DEVELOPER
SECTOR TRENDS
 The global investment in renewable energy keeps a growing trend throughout the last decade, surpassing 329 billion
US Dollars in 2015, which also reflects the growing environmental concerns.
 Concerning the wind energy sector, the numbers on installed capacity are increasing every year. In fact, since 2014,
every year the record of installed capacity from the previous year has been broken. Although the 2015 figures are
not yet final, it is estimated they surpass 51.4 GW from 2014 and reach 60.0 GW. In 2016, this figure is expected to
be also surpassed.
41
04
 Currently, Asia dominates the wind energy market, having most of the worldwide installed capacity, with China
having 25 GW and a 250 GW target established for 2020. The United States state that it is their goal to supply 10 %
of their needs through wind energy until 2020. Europe stopped being the region that incremented more its installed
capacity yearly. It is expected to remain stable throughout 2016, while in 2015 it only added 2 GW, in Germany. The
reports indicate the United Kingdom as the country with the biggest potential. As for Latin America, both wind and
solar energy are growing at a significant pace. Sub-Saharan Africa has an estimated potential of 1,300 GW.
ACTIVITY
Martifer Renewables acts as a developer of renewable energy, mainly in wind and PV power projects. More than accumulating
power in operation, Martifer Renewables’ strategy is focused on the rigorous use of capital in the development and construction of
projects, having implemented an asset rotation policy in projects under development, a construction management, an asset
management and operation and maintenance (O&M).
This business area, which had 39 employees at the end of the year, has a vast experience in the development and management of
wind farms and solar PV parks, being present in five countries: Portugal, Spain, Romania, Poland and Brazil. Owning, in total or in
partnership, a portfolio of over 100 MW in operation, Martifer Renewables has already developed and built more than 700 MW in
different countries, having as partners in the latest projects sold relevant companies, such as IKEA in Poland and Banco Santander,
CPFL and Tractelbel in Brazil.
In 2015, Martifer Renewables sold the Gizalki project (36 MW) in Poland and agreed to the sale of the Assú (90 MW) and Floresta
(80 MW) projects in Brazil. In Portugal, through its associated Ventinveste, it agreed on the sale of 216 MW to EDP and it started
the construction of 171.6 MW of wind farms through the partnership created between Ventinveste and the Ferrostaal Group.
42
04
RESULTS
M€
Revenues
EBITDA
DEC-15
DEC-14
VAR.%
14.0
24.7
-43%
2.7
12.9
-79%
18.9%
52.2%
-33.3 pp
-5.5
-6.4
14%
-1.7
-1.3
-31%
EBIT
-4.6
5.2
n.m.
-32.7%
21.0%
-53.7 pp
Financial Results
7.4
0.0
n.m.
Profit Before Taxes
2.8
5.2
-45%
0.6
-4.5
n.m.
EBITDA Margin
EBIT Margin
Income Tax
Net Profit
3.4
0.6
>100%
0.1
5.3
-99%
3.3
-4.7
n.m.
The RE Developer’s total Revenues amounted to around 14 million euros which result from the assets in operation. The EBITDA
reached 3 million euros in 2015, showing a 79 % decrease when compared to the previous year.
Brazil
2%
Romania
43%
Spain
37%
Portugal
0%
Poland
18%
Other
0%
The Net Profit was positive in 3 million euros in 2015, with the contribution of the financial results, which include the income from
the sale of the Gizalki wind farm in Poland.
The total Capex in 2015 was 2 million euros and was mainly applied in the development of wind projects.
The Net Debt in 2015 totalled around 34 million euros, a 7 million euro increase when compared with the previous year, as a
consequence of the gross debt reduction and increase in cash.
43
04
DISCONTINUED OPERATIONS’ RESULT (SOLAR)
As described in the introductory note in chapter 3 – Financial Performance, in September 2014, the Group started to classify the
solar business unit (consisting of Martifer Solar, SA and its subsidiaries) as a non-current asset held for sale. This change resulted
from the fact that Martifer is presently putting into action its plan to sell its economic interest (currently 55 %) in Martifer Solar.
Since the requirements of IFRS 5 are fulfilled, the contribution to Martifer’s consolidated results, coming from this segment, is presented
in an autonomous line in the Consolidated P&L, and the contribution of assets and liabilities of the operational unit classified as held for
st
sale are also presented in separate lines from the Group’s remaining consolidated assets and liabilities on 31 December 2015.
The discontinued operations’ Result was -2.2 million euros, being -3.2 million euros attributable to Martifer Solar, S.A.. The result
attributable to shareholders was -0.8 million euros.
st
We present the analysis of the main aspects of the performance and position of this segment on 31 December 2015 is presented
below.
ACTIVITY
The backlog of turnkey (signed) contracts is 209 million euros and is spread throughout Europe, Asia and Africa.
The strategic positioning of the company is based on focusing on mature markets with a favourable regulatory framing and
emerging markets with good solar potential for the execution of on and off grid solutions. However, it is important to highlight that
the margins in the solar segment were reduced throughout the value chain, with significant cuts in government support and an
increase in the competition.
RESULTS
The Solar segment ended 2015 with a 2.2 million euros loss, with the contribution to Martifer Solar, S.A. (consolidated perspective
in this holding) reaching -3.2 million euros.
M€
Revenues
EBITDA
EBITDA Margin
EBIT
EBIT Margin
Financial Results
Profit Before Taxes
Income Tax
Net Profit
DEZ-15
DEZ-14
VAR.%
142.6
119.1
20%
3.6
-27.2
n.m.
2.5%
-22.8%
25.3 pp
-2.5
-2.6
5%
2.2
-19.9
n.m.
3.3
-49.6
n.m.
2.3%
-6.5
-3.2
-41.7%
-8.3
-57.9
44 pp
21%
94%
1.0
-8.8
n.m.
-2.2
-66.7
97%
1.0
-9.5
n.m.
-3.2
-57.2
94%
The Revenues in 2015 increased by 20 % when compared to 2014, totalling 142.6 million euros, mainly justified by a 27 MW EPC
project under construction in Jordan and by the final stage of construction of projects in the United Kingdom.
The EBITDA at the end of 2015 was 3.6 million euros (around -27 million euros in 2014), with a 2.5 % margin vs. -23 % YoY,
showing an improvement in the operational performance of the Solar segment, as opposed to the losses registered in 2014. On the
44
04
other hand, throughout 2015, the projects under construction in the United Kingdom, from 2014 onwards, were affected by
adjustments in their operational margins, having impacted the EBITDA unfavourably and negatively.
This segment’s revenues continue focused on the external market, with highlight to Jordan, as previously referred.
Latin
America
5%
EU (other)
6%
United
Kingdom
19%
Italy
8%
Portugal
9%
Other
0%
Jordan
53%
The Net Financial Expenses in 2015 reached 6.5 million euros (in 2014, 8.3 million euros), registering an improvement YoY. The
Net Profit was -2.2 million euros (-3.2 million euros attributable to Martifer Solar, S.A.).
The Capex registered in 2014 was around 0.9 million euros, explained mainly by the investment made in Portugal (Martifer Solar
S.A., with 750 thousand euros), in Chile and in Jordan.
st
The Net Debt registered on 31 December 2015 was 49 million euros, 9 million euros less than in 2014, which shows the effort to
control it, in line with the Group’s current strategy.
45
04
46
05
05 | INDIVIDUAL FINANCIAL INFORMATION
During 2015, the level of services that Martifer SGPS, S.A. (the Group’s holding) provided to other Group companies was similar to
the one in 2014 and 2013, when a great part of the services that had been previously provided by the company have been
transferred to the business areas, following the strategy of allocating greater autonomy to the business areas, with consequent
greater decentralization and accountability.
The Net Profit of Martifer, SGPS, S.A. was positive amounting to 1.4 million euros, comparing to a negative Net Profit of 121.6
million euros in the previous year.
The most significant impacts in Net Profit were the reversal of impairments on financial investments (positive net balance of 12
million euros) and losses from subsidiaries, associates and joint ventures.
48
06
06 | MARTIFER SHARE PERFORMANCE
SHARE PERFORMANCE | 2015
300
250
200
150
Martifer
PSI 20
100
50
0
SOURCE: Reuters
TRADED VOLUME | 2015 – ’000 shares
1000
800
600
400
200
0
SOURCE: Reuters
Martifer’s shares closed 2015 rising around 21 %, with the PSI-20 (Euronext Lisbon’s main index) rising around 13 % when
compared with the end of 2014. Martifer’s share price closed 2015 at 0.227 euros per share (0.187 euros per share at the end of
2014). The maximum price achieved was 0.45 euros per share (1.20 euros per share in 2014) and minimum 0.195 euros per share
(0.186 euros per share in 2014). The average volume of shares traded daily during 2015 was 55 047 shares (66 898 shares in 2014).
50
06
st
Martifer’s market value on 31 December 2015 was 22.7 million euros versus 18.7 million euros at the end of 2014.
PURCHASE OF OWN SHARES
In accordance with CMVM regulation 5/2008, article 11, numbers 1 and 2, we confirm that Martifer SGPS, SA (Martifer) didn’t
purchase own shares on the Stock Exchange during 2015. Therefore, Martifer holds 2,215,910 own shares representing 2.22 % of
its share capital.
 MARTIFER SHARE PERFORMANCE 
51
06
52
07
07 | FUTURE PROSPECTS
In 2016 we will continue to implement the defined strategy, maintaining the focus on the main strategic goals, having as the main
purpose the improvement in profitability and the consequent turnaround for the Group. We will seek:
 to reinforce the international presence, with focus on core geographies and attractive opportunities in markets profitable above
average;
 to reinforce the order book in the Naval and Aluminium areas and the asset rotation strategy in the Renewables segment;
 to reduce indebtedness through the divestment in non-core businesses and through the sale of non-core assets;
 to resize and adequate the structure in all geographies where we are present:
 to improve processes and operational efficiency.
For 2016, due to the estimates of low growth or even economic recession in countries worldwide, we forecast a difficult and
challenging year, but we believe that the defined strategy will allow us to overcome the difficulties and reach an improvement in the
Group’s profitability.
54
08
08 | MAIN RISKS
FINANCIAL RISKS
A) PRICE RISK
The volatility of the prices of raw material constitutes a risk for the Group, both in metallic constructions and in the solar sector. The
antidumping measures / charges that the European Union decided to implement on steel and aluminium products with origin in China
brought a great uncertainty regarding price, which will affect the operational activity of the metallic constructions business area. In
what concerns the market trend on solar panel prices, they kept constant; however, their variation may also influence the solar
activity. Martifer has sought to mitigate this risk the same way in both areas, by including clauses in the contracts with customers that
allow it to pass on raw material price fluctuations and by negotiating fixed prices for large scale projects with its suppliers.
B) CURRENCY RISK
Currency risk has a strong correlation with other risk types, with highlight to its relation with the countries’ risk, through the evolution
of economies and their impact on inflation and on interest rates, and with credit risk, via currency fluctuations that may jeopardize
future financial flows, reflecting the possibility of registering gains or losses resulting from changes in the foreign exchange rates
between different currencies.
The Group’s internationalization forces it to be exposed to a currency risk in different countries.
Exposure to the currency risk results mainly from operational activities (in which expenses, income, assets and liabilities are
expressed in a currency other than the reporting currency of the Group), from transactions between these subsidiaries and other
Group companies and from the existence of transactions with external parties made by the operational companies in a currency
other than the reporting currency of the Group.
The Group’s currency risk management policy aims to reduce the sensitivity of its results in exchange rate variations.
Subsidiaries, in their day-to-day operational activities, seek to use their local currency. Likewise, loans contracted by foreign
subsidiaries are preferably denominated in their local currency.
In what regards exchange rates’ hedging, hedges are sporadic as their cost is sometimes considered excessive in relation to the
risk level involved. However, whenever considered suitable, the Group contracts exchange rates hedging in order to cover the risk.
During 2015, as a result of the severe economic and financial crisis Angola faced, explained in large part by the significant drop in
oil prices, there was a huge shortage of tradable currency in the Angolan market, causing limitations in the financial flows coming
from this country.
The Group has been trying to mitigate this risk through financial instruments presented by its clients (e. g. letters of credit) in order
to maintain the regular financial flow.
C) INTEREST RATE RISK
Interest rate risk reflects the possibility of changes in future interest charges on loans contracted due to the evolution of the market
interest rate levels.
The cost of financial debt contracted by the Group is indexed to short term base rates, reviewed yearly or less, plus a negotiated
risk premium. Therefore, variations in interest rates may affect the Group’s results.
56
08
The Group’s exposure to interest rates is related to financial liabilities contracted with a fixed and / or floating rate. In the first case,
the Group faces a risk of fair value variation in these assets or liabilities, since every change in market rates involves an opportunity
cost. In the second case, such change has a direct impact on interest value, consequently causing cash variations.
In more significant medium and long-term loans and whenever it considers it appropriate the Group relies, when it considers it
appropriate, on fixed interest rate loans or uses interest rate derivatives to hedge exposure to interest rate risk them. The amounts,
interest due dates and repayment schedules of the loans underlying the interest rate derivatives are identical to those of the loans
they hedge, and so being they are considered perfect hedges.
During 2015, the reference interest rates in the euro area remained at very low levels, even reaching negative values at the end of
the year. According to the European Central Bank’s projections published on March 2016 (“March 2016 ECB staff macroeconomic
projections for the euro area”), rates should remain at very low levels during 2016 and 2017, with a modest growth expected for
2018.
th
On 17 December 2015, Martifer signed the debt restructuring agreements with the banks, which involved the renegotiation of risk
premium rates (spread) to very competitive values, allowing a lower exposure to interest rate risk. This change in the bank financing
st
pricing took effect as of 1 January 2015. This factor, together with the expected stability in the reference rates contribute to
Martifer’s current low exposure to interest rate risk.
D) LIQUIDITY RISK
Liquidity risk reflects the Group’s ability to satisfy its financial responsibilities with the financial resources available.
The main goal of the liquidity risk management program is to ensure that the Group has available, whenever needed, the financial
resources to satisfy its responsibilities and pursue the outlined strategies, honouring all its obligations towards third parties, through
an adequate management of the financing cost / maturity ratio.
As mentioned above, at the end of 2015 the Group restructured its debt with financial institutions, through the rescheduling of bank
financing repayments over time, increasing the debt maturity in order to make it coincide with the long term assets’ continuity and at
the same time to allow the cash surpluses to be sufficient to comply with its responsibilities.
Therefore, and taking in mind the medium / long term features of the investments made, the debt service accompanies the maturity
of the associated assets, not jeopardizing the commitments from its short-term operational activity in the pursuit of the Group’s goal
to adequate the inflows maturity of the operational activity and investment (divestment) to the outflows of the financing activity.
st
As a concequence of the previously mentioned measures, it is verifiable that on 31 December 2015, the Current Assets largely
surpass the Current Liabilities. Therefore, the liquidity risk is quite reduced, due to Martifer’s capacity to transform its short-term
assents into liquidity.
The financial direction accompanies the implementation of the risk management policies defined by the board, in order to ensure
that the economic and financial risks are identified, measured and managed according to those policies.
E) CREDIT RISK
The worsening of the worldwide economic conditions or the adversities affecting local, national and international economies can
influence Martifer Group’s clients’ default rate, with possible negative impacts on the Group’s results.
The Group undergoes credit risk in its operational activity Trade Receivables and Other Receivables.
Aware of this reality, the Group tries to assess all its clients’ credit risk in order to establish credit limits, with the ultimate purpose of
ensuring the collection of the due amounts within the negotiated periods.
 MAIN RISKS 
57
08
With this objective in mind, the Group uses credit rating agencies, regular risk analysis and credit control and collects from and
manages cases in litigation, procedures which are all considered essential to manage the credit conceeded and to minimize the risk
of credit default.
OPERATIONAL RISKS
A) METALLIC CONSTRUCTIONS
Operational risks in the Metallic Constructions area, which also incorporated the energy equipment area as of 2011, are currently
divided into three risk sources – clients, suppliers and external risks, which in turn are sub-divided into specific problems.
Regarding the client risk one can identify, for example, issues at the contractual level, such as the lack of convergence in the
interpretation and application of the contractual dispositions, the distaste or dissatisfaction with the service / product and also the
risk of non-payment of the price stipulated following the delivery of the projects.
In terms of demand volatility, it is important to note that the business area partly depends on the launch of public tenders for public
infrastructures (e.g. bridges, airports, train stations). Within the scope of public tenders, Martifer is subject to complex regulatory
demands, specific to each country, namely in matters concerning the presentation of the proposals and the preparation of complex
administrative documentation files to satisfy the project’s specifications defined by the contracting entity. This may represent
additional costs for Martifer Group. It must be highlighted that, despite the dependence on public tenders, Martifer has been able to
win deals not subject to public tenders, thereby reducing its exposure to this risk.
Under the supplier risk, Martifer Construções as a specialist in engineering projects very often relies on subcontractors. If these fail
in the execution of their work, the project’s delivery deadline cannot be met, in a domino effect. In other words, there is also a risk of
delays in delivering the projects, with the inherent contractual penalties.
Finally, in terms of external risks and considering that the area of Metallic Constructions is strongly correlated with economic growth
and with gross fixed capital formation, it is therefore sensitive to the current economic environment. Accordingly, the worsening of
the sovereign debt crisis in Europe also raises other problems, namely the austerity plans that imply severe transversal cuts in
public investment and the significant decrease in liquidity throughout the financial system, which often causes highly attractive
projects to be shelved due to lack of capital.
In order to mitigate these risks, the Metallic Constructions area diversified its projects in different geographies, namely by entering
markets that register stronger growth in the construction sector, such as Angola and Algeria, or even by ‘visiting countries’ such as Saudi
Arabia, which will allow to compensate both the effects of economic recession in Portugal and the economic slowdown in Europe.
B) SOLAR
In the turnkey park installation activity, end-client delays in obtaining the necessary licences or unanticipated delays in the delivery
of equipment may disrupt the initially foreseen schedule for the completion of the respective projects. Despite the fact that this type
of delay usually carries no contractual penalties, in some cases this situation can constitute a risk for the Group given the planning
difficulties it can represent.
Additionally, the financial market crisis has been hampering the promoters’ access to funding, resulting in the postponement of
some projects. The diversification of the business throughout the value chain and the diversified client portfolio inside and outside
the Group that is currently being adopted shall reduce the possible impact of this situation.
The solar photovoltaic modules produced by the company are traded with a 5-year warranty and a 25-year performance warranty.
As a result, this sector is exposed to the risk of warranty claims many years after the sale of the equipment. Accordingly, any quality
or performance problems that may occur can result in high costs. The performance of solar systems is also guaranteed in terms of
the modules acquired for the construction of solar parks; however, the Group’s responsibility, in this case, is diminished since there
is a right of recourse vis-à-vis the suppliers.
58
08
Additionally, most of the equipment used in the production of solar photovoltaic modules is customized with specific raw materials,
with a resulting dependency risk on key raw material suppliers. The Group has sought to mitigate this risk by establishing long-term
contracts for some raw-materials, carefully selecting suppliers and working towards bringing together a diversification of suppliers
for each of the relevant raw-materials.
C) RENEWABLES
The productivity indices associated with the renewable energy business depend not only on the operational costs, but also on its
revenues (price and volume of energy produced by the assets). The equipment usage and other exogenous factors, such as the
wind that, in turn, depends on the farm location, influence the energy production and consequently its results. Whenever the wind
speed is below or above the equipment limits, no energy is produced. These limits vary according to the manufacturer and the type
of turbine. Additionally, each turbine has a power curve that determines the generated power of each wind speed.
The readiness and power curve of each turbine is contractually guaranteed, with indemnities being payable by the suppliers for
situations where their readiness is not satisfied or the power curve is not attained.
This risk is also mitigated through the geographical distribution of the wind turbines in the wind farms, allowing the set-off of wind
velocity variations on each farm and ensuring the relative stability of the volume of the total produced energy.
Regarding solar photovoltaic energy, the exogenous factors are more easily forecasted and therefore the revenues variation is
minimized.
LICENCING:
Wind farms and solar parks are subject to rigorous regulations in matters such as their development, construction, licensing and
operation. If the relevant authorities in the jurisdictions in which the Group operates stop or reduce their support in the development
of wind farms and solar parks, such actions may have a significant impact on the activity.
LEGAL RISKS
Martifer is subject to the national and local laws and regulations in the various geographies and markets where it operates. These
aim to ensure, among other, labour rights, environment protection, spatial planning and the maintenance of an open and
competitive market. Thus, the legal and regulatory changes that affect the conditions conducive to the development of the Groups’
activities and that consequently harm or impede the attainment of the strategic objectives require the Company to adapt to the new
regulatory realities.
The management of legal risk is carried out by the legal department of the holding company and of each of the Group’s Business
Areas and is monitored within the scope of reviews performed by internal legal and fiscal service providers dedicated to the
respective activities, which operate in the dependence of the Board of Directors and Management, conducting their work in
articulation with the other fiscal and financial departments, so as to ensure the protection of the Company’s interests and ultimately
those of the stakeholders, in strict compliance with their legal duties.
The members of the legal departments and internal advisory service providers referred to above have specialized formal
qualifications and undergo regular formal training and updating.
Legal and fiscal advisory services are also ensured, nationally and internationally by external professionals, selected amongst
reputable firms and in accordance with the highest standards of competence, ethics and experience.
 MAIN RISKS 
59
08
60
09
09 | PROPOSAL OF RESULTS ALLOCATION
The Board of Directors recommends to the General Shareholders’ Meeting, the allocation of the net profit resulting from the
Individual Financial Information totalling of 1,401,241 euros, recorded in 2015, as follows:
 Legal Reserve; 5 % of the Net Result, totalling 70,062.06 euros;
 Retained Earnings; 1,331,179.13 euros.
th
Oliveira de Frades, 6 April 2016
The Board of Directors,
Carlos Manuel Marques Martins
(Chairman of the Board of Directors)
Jorge Alberto Marques Martins
(Vice-Chairman of the Board of Directors)
Pedro Nuno Cardoso Abreu Moreira
(Member of the Board of Directors)
Arnaldo José Nunes da Costa Figueiredo
Jorge Bento Ribeiro Barbosa Farinha
Luís Valadares Tavares
62
10
10 | OTHER INFORMATION
BUSINESS DEVELOPED BY NON-EXECUTIVE MEMBERS OF THE BOARD
OF DIRECTORS
In addition to incorporating Martifer SGPS, SA’s Board of Directors, almost every non-executive board member integrates, at least,
one of the nominated Committees by the Board (Committee for Corporate Governance, Committee for Ethics and Conduct or
Committee for Risk). Each of these Committee’s rules are published in the Group’s website and the functions and activities
developed throughout 2015 are outlined in the Corporate Governance Report.
Throughout the year, the non-executive members of the Board have shared and expressed relevant opinions regarding specific
business segments based on their performance, the risks associated and the outlook, maintaining regular communication with the
executive Board Members, and the Board Members and Directors of the business units.
PERMITS GIVEN TO BUSINESS TRANSACTIONS BETWEEN THE COMPANY
AND ITS BOARD MEMBERS, ACCORDING TO ARTICLE 397 OF THE
PORTUGUESE COMPANIES CODE
In 2015, the following deals or transactions were made between the company and the Board of Directors or the Supervisory Board:
 Sale of 100 % of the share capital of the subsidiary MARTIFER – INOVAÇÃO E GESTÃO, S.A., headquartered in Zona
Industrial de Oliveira de Frades, parish of Oliveira de Frades, Souto de Lafões e Sejães and municipality of Oliveira de Frades,
registered in the trade register of Oliveira de Frades under the single number of register and tax 507 986 644, with a share
capital of € 100,000.00 (one hundred thousand euros), to the subsidiary MARTIFER METALLIC CONSTRUCTIONS – SGPS,
S.A., 75 % owned by MARTIFER SGPS, S.A., and 25 % owned by VECTOR DIÁLOGO – SGPS, S.A., in which the board
members Mr. Carlos Manuel Marques Martins and Mr. Jorge Alberto Marques Martins indirectly own a 53.05 % share, through
th
the company I’M, SGPS, S.A.. The Supervisory Board issued a favourable opinion to the sale on 20 October 2015.

Sale of 100 % of the share capital of the subsidiary MARTIFER ENERGY SYSTEMS, SGPS, S.A., headquartered in Zona
Industrial de Oliveira de Frades, parish of Oliveira de Frades, Souto de Lafões e Sejães and municipality of Oliveira de
Frades, registered in the trade register of Oliveira de Frades under the single number of register and tax 508 338 352, with
a share capital of € 50,000.00 (fifty thousand euros), to the subsidiary MARTIFER METALLIC CONSTRUCTIONS –
SGPS, S.A., 75 % owned by MARTIFER SGPS, S.A., and 25 % owned by VECTOR DIÁLOGO – SGPS, S.A., in which
the board members Mr. Carlos Manuel Marques Martins and Mr. Jorge Alberto Marques Martins indirectly own a 53.05 %
th
share, through the company I’M, SGPS, S.A.. The Supervisory Board issued a favourable opinion to the sale on 14
December 2015.
 Sale of 100 % of the share capital of the subsidiary GEBOX, S.A., headquartered in Zona Industrial de Oliveira de Frades,
parish of Oliveira de Frades, Souto de Lafões e Sejães and municipality of Oliveira de Frades, registered in the trade register of
Oliveira de Frades under the single number of register and tax 507 729 099, with a share capital of € 50,000.00 (fifty thousand
euros), to the subsidiary MARTIFER METALLIC CONSTRUCTIONS – SGPS, S.A., 75 % owned by MARTIFER SGPS, S.A.,
and 25 % owned by VECTOR DIÁLOGO – SGPS, S.A., in which the board members Mr. Carlos Manuel Marques Martins and
Mr. Jorge Alberto Marques Martins indirectly own a 53.05 % share, through the company I’M, SGPS, S.A.. The Supervisory
th
Board issued a favourable opinion to the sale on 14 December 2015.
OTHER INFORMATION
Martifer SGPS, S.A. doesn’t present any debt to the State or any other public entity, including Social Security.
64
MANDATORY INFORMATION
SHAREHOLDINGS OF THE MEMBERS OF THE MANAGEMENT AND
SUPERVISORY BODIES
In accordance with articles 447 and 448 of the Portuguese Companies Code, the securities issued by Martifer, SGPS, SA and
st
st
companies dominated by it, held by members of the governing bodies in the period from 1 January 2015 through to 31 December
2015, are the following:
HOLDER
GOVERNING BODY
NO. SHARES HELD ON 31/12/2015
Carlos Manuel Marques Martins*
Board of Directors
420,542
Board of Directors
230,260
I’M – SGPS, S.A. **
Board of Directors
42,405,689
Board of Directors
3,000
MOTA-ENGIL, SGPS, S.A. ***
Board of Directors
37,500,000
Board of Directors
-
Board of Directors
-
Board of Directors
-
Américo Agostinho Martins Pereira
Supervisory Board
-
Carlos Alberto da Silva e Cunha
Supervisory Board
-
Paulo Sérgio Jesus das Neves
Supervisory Board
-
António Baia Engana
Supervisory Board
-
Statutory Auditor, representing
PricewaterhouseCoopers
-
José Joaquim Neiva Nunes de Oliveira
General Meeting
-
Luís Leitão Marques Vale Lima
General Meeting
-
Luís Neiva Nunes de Oliveira
General Meeting
-
Hermínio António Paulos Afonso
* Shares held by the company Black & Blue Investimentos, S.A. (Carlos Manuel Marques Martins is a board member in this company and, together with his household,
are sole shareholders).
** Directors Carlos Manuel Marques Martins and Jorge Alberto Marques Martins are holders of the share capital of I’M SGPS, SA and are, respectively, its Chairman of
the Board of Directors and Director.
*** Director Arnaldo José Nunes da Costa Figueiredo is a member of the Board of MOTA-ENGIL, SGPS, S.A.
EVENTS DESCRIBED IN ARTICLE 447 OF THE PORTUGUESE COMPANIES
CODE
NAME OF THE MEMBER OF THE GOVERNING BODY
GOVERNING BODY
NO. SHARES HELD ON 31/12/2014
Board of Directors
420,542
Board of Directors
230,260
Board of Directors
0
Arnaldo Nunes da Costa Figueiredo
Board of Directors
3,000
Luís António de Valadares Tavares
Board of Directors
0
Board of Directors
0
Supervisory Board
0
Supervisory Board
0
Supervisory Board
0
Supervisory Board
0
66
Directors Carlos Manuel Marques Martins and Jorge Alberto Marques Martins, respectively Chairman and Vice-Chairman of the
st
Board of Directors, besides the shares held as described above, are sole equal shareholders of I’M SGPS, SA, that on 31
December 2015 held a total of 42,405,689 shares of Martifer SGPS, S.A..
Transactions by the members of the governing bodies in 2014:
MEMBER OF THE GOVERNING BODY
DATE
PURCHASE
SALE
AVERAGE PRICE
07-01-2015
20,000
0.196
15-01-2015
8,524
16-01-2015
6,600
19-01-2015
217
20-01-2015
1,381
26-01-2015
5,420
28-01-2015
2,740
29-01-2015
26,619
02-02-2015
1,941
I’M – SGPS, S.A.
30-12-2015
7,000
I’M – SGPS, S.A.
31-12-2015
33,000
-
0.219
0.212
0.214
0.215
0.220
0.219
0.218
0.215
0.234
0.228
*purchases by the company Black & Blue, S.A. (Carlos Manuel Marques Martins is a shareholder and a Board member of this company)
HOLDERS OF QUALIFYING SHAREHOLDINGS
According to paragraph 1b) of article 8 of CMVM regulation number 5/2008, and fulfilling article 448 of the Portuguese Companies
Code, the following is the list of qualifying shareholders, with an indication of the number of shares and percentage of voting rights
st
held, calculated according to article 20 of the Securities Code (CMVM), as of 31 December 2015:
NO. OF SHARES
% OF SHARE CAPITAL
% OF VOTING RIGHTS 1
42,405,689
42.41%
43.37%
420,542
0.42%
0.43%
Jorge Alberto Marques Martins*
230,260
0.23%
0.24%
Total Imputable to I’M – SGPS, SA
43,056,491
43.06%
44.03%
Mota-Engil – SGPS, SA
SHAREHOLDERS
I’M – SGPS, SA
37,500,000
37.50%
38.35%
Arnaldo José Nunes da Costa Figueiredo **
3,000
0.00%
0.00%
Total Imputable to Mota-Engil, SGPS, SA
37,503,000
37.50%
38.35%
1
% Voting rights = Number shares / (No. shares – Own shares)
* Holder of a position in the Governing Bodies of I’M SGPS, SA
** Holder of a position in the Governing Bodies of Mota-Engil SGPS, SA
 MANDATORY INFORMATION 
67
STATEMENT OF COMPLIANCE ACCORDING TO ARTICLE 245, NUMBER 1,
PARAGRAPH C) OF THE SECURITIES CODE (CMVM)
(Free translation from the original in Portuguese)
Dear Shareholders,
According to article 245, number 1, paragraph c) of the Securities Code (CMVM) and to the best of our knowledge:
(i) The information contained in the consolidated management report faithfully reports the evolution of trading, the performance and
the position of Martifer, SGPS, SA and of the companies in its consolidation perimeter and contains a description of the main risks
and uncertainties facing its business; and
(ii) The information contained in its individual and consolidated financial statements and accompanying notes was prepared in
accordance with the applicable accounting practices, giving a true and fair view of the assets, liabilities, financial position and
results of Martifer, SGPS, SA and of the companies included in its consolidation perimeter.
th
The Board of Directors,
(Chairman of the Board of Directors)
(Vice-Chairman of the Board of Directors)
68
70
11
11 | CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED INCOME STATEMENTS FOR THE YEARS AND QUARTERS ENDED ON
31ST DECEMBER 2015 AND 2014
(The consolidated financial statements were originally issued in Portuguese - Note 44)
Sales and services rendered
NOTES
FY 2015
FY 2014
4TH QUARTER
2015
(NOT AUDITED)
4TH QUARTER
2014
(NOT AUDITED)
54,850,052
3 and 4
220,885,349
188,907,997
42,023,225
Other income
5
31,700,364
36,911,006
5,138,223
12,729,491
Cost of goods sold
6
(67,803,434)
(55,328,809)
(10,594,722)
(18,300,801)
Subcontractors
7
(53,741,731)
(33,997,204)
(7,290,525)
(9,512,768)
External supplies and services
8
(53,677,811)
(48,387,513)
(12,155,711)
(12,885,152)
Staff costs
9
(51,027,329)
(58,151,851)
(10,532,771)
(14,960,854)
Other expenses
10
(14,946,252)
(23,949,574)
(7,747,144)
(14,434,514)
3
11,389,156
6,004,052
(1,159,425)
(2,514,546)
Amortizations
(11,979,677)
(14,633,359)
(2,197,153)
(3,583,699)
Provisions
3, 18 and 19
3 and 11
2,510,217
(36,573,865)
3,415,441
(6,144,254)
Impairment losses on fixed assets
3 and 11
(2,438,713)
(2,057,171)
(2,327,964)
50,375
(519,017)
(47,260,343)
(2,269,101)
(12,192,124)
3
Financial income
12
19,324,708
9,117,405
14,116,620
5,136,762
Financial expenses
12
(16,251,158)
(29,696,065)
3,644,485
(7,740,164)
Gains / (losses) on associate companies and joint arrangements
3 and 13
Profit before tax of continued operational units
(35,768)
1,172,815
185,615
273,589
2,518,765
(66,666,188)
15,677,619
(14,521,937)
Income tax
14
(545,697)
(4,864,257)
361,083
(2,602,419)
Profit after tax of continued operational units
3
1,973,068
(71,530,445)
16,038,702
(17,124,356)
Earnings from discontinued operations
28
(800,771)
(65,171,979)
1,140,146
(40,598,915)
non-controlling interests
28
192,574
(34,428,519)
1,421,699
(23,290,734)
owners of Martifer
28
Attributable to:
Profit for the year
(993,345)
(30,743,460)
(281,553)
(17,308,181)
1,172,297
(136,702,424)
17,178,848
(57,723,271)
1,654,786
(43,166,600)
3,540,439
(10,945,310)
(482,490)
(93,535,824)
13,638,407
(29,768,951)
(0.0049)
(0.9566)
0.1395
(0.3044)
0.0052
(0.6422)
(0.0362)
(0.2541)
(0.0102)
(0.3144)
(0.0029)
(0.0503)
Attributable to:
29
owners of Martifer
Earnings per share:
16
Basic and diluted
from continued operations
from discontinued operations
Note: In September 2014, the Group started to classify the solar business unit (composed by Martifer Solar, SA and its subsidiaries) as a non-current asset held for sale.
Since the requirements of IFRS 5 were fulfilled, the contribution to Martifer’s consolidated results coming from this segment is presented in an autonomous line in the
Consolidated Income Statement. The breakdown of these contributions is included in the Notes to Consolidated Financial Statements (Note 28).
The accompanying notes are part of these financial statements.
72
11
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS AND
QUARTERS ENDED ON 31ST DECEMBER 2015 AND 2014
TH
FY 2014
QUARTER
2015
(NOT AUDITED)
QUARTER
2014
(NOT AUDITED)
1,172,297
(136,702,424)
17,178,848
(57,723,271)
137,271
(362,032)
184,520
72,114
Exchange differences arising from (i) translating foreign operations; (ii) net
investment in subsidiaries and (iii) goodwill
(4,072,691)
(294,561)
6,444,687
(4,311,411)
Income recognized directly in equity
(3,935,421)
(656,593)
6,629,207
(4,239,297)
Total comprehensive income of the period
(2,763,124)
(137,359,017)
23,808,055
(61,962,568)
Profit of the period
Fair value of cash flow hedges (derivatives), net of tax
4
TH
FY 2015
4
Attributable to:
owners of Martifer
194,182
(46,227,226)
6,557,556
(28,078,636)
(2,957,306)
(91,131,791)
17,250,497
(33,883,932)
(1,971,719)
(71,242,460)
20,006,604
(21,478,797)
(791,405)
(66,116,557)
3,801,450
(40,483,771)
Total comprehensive income of the period:
 CONSOLIDATED FINANCIAL STATEMENTS 
73
11
CONSOLIDATED STATEMENTS OF THE FINANCIAL POSITION FOR THE YEARS ENDED ON
NOTES
FY 2015
FY 2014
10,980,675
ASSETS
Non-current assets
Goodwill
17
10,980,675
Intangible assets
18
2,904,590
4,327,472
Tangible fixed assets
19
149,147,425
166,415,160
Investment properties
20
25,951,708
14,367,300
3, 21
3,150,644
7,798,516
Available for sale investments
22
4,266,234
2,191,512
Other non-current receivables
24
36,662,933
62,150,851
Deferred tax assets
14
5,942,206
239,006,415
4,720,190
272,951,676
Financial assets under the equity method
Current assets
Inventories
23
8,657,442
15,135,531
Trade receivables
24
74,986,130
87,582,767
Other receivables
24
52,761,111
36,187,928
14, 25
1,029,684
744,905
Current tax assets
25
5,872,971
7,974,973
Other current assets
26
36,029,340
40,904,841
27
40,549,549
22,981,322
Derivatives
37
31,114
-
Non-current assets held for sale
28
147,707,342
367,624,683
148,265,754
359,778,022
Total assets
3
606,631,099
632,729,698
Income tax
EQUITY
Issued capital
Share premium
Treasury stock
Reserves
Profit of the year
Equity attributable to owners of Martifer
50,000,000
50,000,000
186,500,000
186,500,000
(2,868,519)
(2,868,519)
(193,099,200)
-99,805,371
(482,490)
(93,535,824)
40,049,791
40,290,287
29
(26,500,022)
(22,882,274)
Non-controlling interests attributable to non-current assets held for sale
Total equity
28
(1,877,184)
11,672,584
(2,060,023)
15,347,990
Borrowings
30
275,818,851
215,538,471
Obligations under finance leases
31
10,235,296
13,830,713
Other non-current liabilities
32
11,667,063
12,381,230
Provisions
33
19,973,592
23,199,209
Deferred tax liabilities
14
916,299
318,611,101
930,496
265,880,119
Borrowings
30
13,828,525
73,645,092
Obligation under finance leases
31
988,858
2,481,603
Trade payables
32
61,211,154
63,638,919
Other payables
32
16,550,243
27,179,264
Income tax
14
2,257,208
1,258,326
Current tax liabilities
35
2,972,076
8,995,347
36
41,559,999
42,091,465
Derivatives
37
0
216,614
Liabilities related with non-current assets held for sale
28
Total liabilities
3
136,979,351
276,347,414
594,958,514
131,994,958
351,501,588
617,381,707
606,631,099
632,729,698
LIABILITIES
Non-current liabilities
Current liabilities
Total equity and liabilities
74
11
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED ON 31ST DECEMBER 2015 AND 2014
CASH FLOW HEDGE
DERIVATIVES
FOREIGN
CURRENCY
TRANSLATION
RESERVES
OTHER
RESERVES
NET PROFIT
FOR THE
YEAR
EQUITY
ATTRIBUTABLE
TO OWNERS
OF THE PARENT
NON-CONTROLLING
INTERESTS
TOTAL
EQUITY
(2,868,519)
307,575
(21,990,557)
(42,971,754)
(68,961,164)
100,015,581
39,676,431
139,692,012
-
-
-
(68,961,164)
68,961,164
-
-
-
-
-
-
-
-
(93,535,824)
(93,535,824)
(43,166,600)
(136,702,424)
-
-
-
2,716,484
-
-
2,716,484
(2,994,900)
(278,416)
-
-
-
-
(8,880)
-
-
(8,880)
(7,265)
(16,145)
-
-
-
(303,571)
-
-
-
(303,571)
(58,461)
(362,032)
Total comprehensive income of the year
-
-
-
(303,571)
2,707,604
-
(93,535,824)
(91,131,792)
(46,227,226)
(137,359,018)
Other changes in equity of parent company and
subsidiaries
-
-
-
-
-
(5,541,582)
-
(5,541,582)
(5,154,706)
(10,696,288)
Changes in the consolidation perimeter
-
-
-
-
-
(58,508)
-
(58,508)
(4,230,209)
(4,288,717)
Transactions of non-controlling interests
-
-
-
-
-
37,006,587
-
37,006,587
(9,006,587)
28,000,000
Balance on 31 December 2014
50,000,000
186,500,000
(2,868,519)
4,004
(19,282,953)
(80,526,421)
(93,535,824)
40,290,287
(24,942,297)
15,347,990
Balance on 1st January 2015
50,000,000
186,500,000
(2,868,519)
4,004
(19,282,953)
(80,526,421)
(93,535,824)
40,290,287
(24,942,297)
15,347,990
-
-
-
(93,535,824)
93,535,824
-
-
-
Profit for the year
-
-
-
-
-
-
(482,490)
(482,490)
1,654,786
1,172,296
Exchange differences arising from (i) translating foreign
operations and (ii) net investment in subsidiaries
-
-
-
-
(2,596,242)
-
-
(2,596,242)
(1,510,281)
(4,106,524)
Exchange differences arising from goodwill
-
-
-
-
18,608
-
-
18,608
15,225
33,833
Other changes in equity of parent company
and subsidiaries
-
-
-
17,034
-
85,784
-
102,818
34,453
137,271
Total comprehensive income of the year
-
-
-
17,034
(2,577,635)
85,784
(482,490)
(2,957,306)
194,182
(2,763,125)
Capital increase in subsidiaries
-
-
-
-
-
-
-
-
443,200
443,200
Other changes in equity of parent company and
subsidiaries
-
-
-
-
-
(574,435)
-
(574,435)
-
(574,435)
-
-
-
-
-
3,291,250
-
3,291,250
(4,072,288)
(781,038)
Transactions of non-controlling interests
-
-
-
-
-
(5)
-
(5)
(2)
(8)
50,000,000
186,500,000
(2,868,519)
21,038
(21,860,588)
(171,259,650)
(482,490)
40,049,791
(28,377,206)
11,672,585
ISSUED
CAPITAL
SHARE
PREMIUM
TREASURY
STOCK
50,000,000
186,500,000
-
-
Profit for the year
-
Exchange differences arising from (i) translating foreign
operations and (ii) net investment in subsidiaries
-
Exchange differences arising from goodwill
Other changes in equity of parent company
and subsidiaries
Balance on 1st January 2014
Appropriation of the profit of 2013
FAIR VALUE RESERVES
COMPREHENSIVE INCOME FOR THE YEAR:
st
COMPREHENSIVE INCOME FOR THE YEAR:
Balance on 31st December 2015
 CONSOLIDATED FINANCIAL STATEMENTS 
75
11
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS AND QUARTERS
ENDED ON 31ST DECEMBER 2015 AND 2014
NOTES
FY 2015
FY 2014
TH
4
QUARTER 2015
(NOT AUDITED)
TH
4
QUARTER 2014
(NOT AUDITED)
OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers
Payments to employees
Cash generated from operations
Income tax paid / received
Other receipts / (payments) related to operating activities
27
Cash generated from other operating activities
Net cash generated by operating activities from discontinued operations
28
Net cash generated by operating activities (1)
280,274,301
186,215,670
47,138,020
7,600,508
(197,332,517)
(161,579,157)
(22,582,788)
(41,460,061)
(51,898,967)
(42,881,294)
(11,488,650)
(783,934)
31,042,817
(18,244,781)
13,066,582
(34,643,487)
(1,160,709)
(4,254,094)
(58,923)
(1,986,191)
(2,318,336)
9,347,134
(937,823)
33,108,170
(3,479,045)
5,093,040
(996,746)
31,121,979
11,175,384
(2,927,493)
9,076,780
(5,287,371)
38,739,156
(16,079,234)
21,146,616
(8,808,879)
10,740,108
23,722,134
10,413,874
1,359,012
268
468,724
268
-
2,814,668
15,890,560
1,001,945
6,842,605
INVESTMENT ACTIVITIES
Receipts arising from:
Financial assets
42
Intangible assets
Investment grants
Interest and similar income
Others
-
139,068
-
(1,834)
359,330
1,256,897
(752,732)
1,171,691
526,392
5,700,685
(3,627)
5,503,677
14,440,766
47,178,069
10,659,728
14,875,151
-
-
(4,502,497)
(14,858,320)
(1,724,211)
(3,508,674)
Payments arising from:
Intangible assets
(348,219)
128,871
(75,941)
239,215
Others
(104,049)
(286,120)
223,619
(101,746)
(4,954,765)
(15,015,569)
(1,576,534)
(3,371,205)
1,222,829
561,140
544,127
2,040,360
10,708,830
32,723,640
9,627,320
13,544,306
251,187,666
408,250,707
95,194,494
131,190,267
-
28,000,000
-
13,000,000
49,010
3,142
(1,632)
(48,122)
251,236,676
436,253,849
95,192,862
144,142,145
(250,723,853)
(421,264,705)
(90,463,817)
(142,728,611)
(1,492,745)
(903,174)
(1,110,009)
(399,980)
(10,588,202)
(20,405,045)
(3,616,339)
(4,941,099)
(100,112)
Net cash generated by investment activities from discontinued operations
28
Net cash generated by investing activities (2)
FINANCING ACTIVITIES
Borrowings
Issue of equity shares, supplementary capital and share premiums
29
Others
Borrowings
Leasings
Interest and similar costs
Reductions of equity and others reserves
29
Others
Net cash generated by financing activities from discontinued operations
28
-
(12,292,147)
-
(23,873)
(368,717)
(10,920)
(368,717)
(262,828,673)
(455,233,788)
(95,201,085)
(148,538,519)
(5,082,561)
(8,006,184)
(1,938,662)
(5,161,063)
(16,674,558)
(26,986,123)
(1,946,885)
(9,557,437)
Net increase in cash and cash equivalents (4)=(1)+(2)+(3)
32,773,428
(10,341,717)
28,827,052
(4,822,010)
Changes in the consolidation perimeter and other
(7,455,930)
(959,370)
(7,028,878)
(731,777)
Effect of foreign exchange currencies
(1,133,591)
913,623
381,433
(417,963)
Cash and cash equivalents at the beginning of the period
28,456,245
38,843,709
30,460,545
34,427,995
Net cash generated by financing activities (3)
Cash and cash equivalents at the end of the period
27
40,549,549
22,981,322
40,549,549
22,981,322
28
12,090,603
5,474,923
12,090,603
5,474,923
76
12
12 | NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS
INTRODUCTORY NOTE
Martifer SGPS, S.A., with its registered head-office at Zona Industrial, town of Oliveira de Frades, in Portugal (‘Martifer SGPS’ or
‘Company’), and its group of companies (all denominated ‘Group’), have as their main activities metallic constructions (steel
structures, aluminium and glass façades, infrastructures for oil & gas and naval industry) and the promotion and development of
renewable energy projects (Note 3).
th
Martifer SGPS was incorporated on 29 October 2004, having its share capital been realized through the delivery of market valued
shares that the shareholders held in Martifer Construções, S.A., a company that was incorporated in 1990 and which at that time
was the holding company of the current Martifer Group.
As of the initial public offering in June 2007, the Martifer SGPS, S.A. shares have been listed on Euronext Lisbon.
In September 2014, Martifer SGPS’s Board of Directors decided, following the strategy to focus on the metallic construction area, to
sell its stake in Martifer Solar (composed by Martifer Solar S.A. and its subsidiaries, currently 55 % held by the Group). As the sale
is highly likely, and the requirements of IFRS 5 were fulfilled, Martifer Solar’s assets and liabilities were classified as “non-current
assets held for sale” and “liabilities associated to non current assets held for sale”, respectively, being Martifer Solar’s Net Profit
presented as “discontinued operations’ result” (Note 28).
st
On 31 December 2015, the Group was developing its activity mainly in Portugal, in Spain, in Slovakia, in Romania, in Poland, in
Angola, in Brazil, in Mozambique, in Ireland, in the Netherlands, in France, in Morocco, in the United Kingdom, in Saudi Arabia, in
Germany, in Malta and in Algeria.
All the amounts presented in these notes are expressed in euros (rounded to the unit), unless otherwise indicated.
1. SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PREPARATION
These accompanying consolidated financial statements relate to the consolidated financial statements of Martifer Group and were
prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the European Union, in force at
st
the beginning of the economic period started on 1 January 2015. These are the International Financial Reporting Standards that
were issued by the International Accounting Standards Board (IASB) and whose interpretations were issued by the International
Financial Reporting Interpretations Committee (IFRIC) or by the previous Standing Interpretations Committee (SIC) that have been
endorsed by the European Union.
These consolidated financial statements have been prepared from the books and accounting records of the companies included in
the consolidation (Note 2) and have been prepared under the historical cost convention, except for the revaluation of certain noncurrent assets and certain financial instruments, which are stated at fair value.
The accounting policies and mensuration criteria adopted by the Group in the 2015 financial period are consistent with those
applied in the financial statements of the previous financial period, presented for comparative purposes, except in respect of the
st
standards and interpretations entering into force on or after 1 January 2015, the adoption of which has not had a significant impact
on the Group’s comprehensive income or financial position.
78
12
Standards and changes to standards which were published but are only mandatory for annual periods that start on or after 1
February 2015, and that the Company decided not to adopt in advance:
st
EFFECTIVE DATE
Improvements in norms 2010 - 2012
01-02-2015
IAS 19 – Defined benefit plans
01-02-2015
IAS 16 and IAS 38 – Amortization / depreciation calculation methods
01-01-2016
IAS 27 – Separate financial statements
01-01-2016
IAS 16 and IAS 41 – Agriculture: Plants that produce consumable biological assets
01-01-2016
IFRS 11 – Joint agreements
01-01-2016
IAS 1 – Presentation of the financial statements
01-01-2016
Improvements in norms 2012 – 2014
01-01-2016
The improvements in norms 2010 - 2012 are the result of annual improvement projects implemented in the 2010 - 2012 cycle,
which affected the following standards: IFRS 2 – Share-based Payment, IFRS 3 – Business Combinations, IFRS 8 – Operating
Segments, IFRS 13 – Fair Value Measurement, IAS 16 – Property, Plant and Equipment, IAS 24 – Related Party Disclosures and
IAS 38 – Intangible Assets.
The change in the IAS 19 – Employee Benefits is applied to the contribution of employees or of third parties in defined benefit plans
and aims to simplify the accounting of contributions that are independent of the number of years of service.
The change in IAS 16 – Property, Plant and Equipment and in IAS 38 – Intangible Assets clarifies that the use of depreciation
methods based on revenue are not appropriated since the revenue generated by an activity that includes the use of an asset
usually reflects other factors besides the consumption of the economic benefits incorporated on the asset. Additionally, the change
also clarifies that the revenue is usually considered an inappropriate basis for measurement of the consumption of economic
benefits incorporated in an intangible asset.
The change in IAS 27 – Consolidated and Separate Financial Statements allows the use of the equity method in the accounting of
shares in subsidiaries, joint ventures and associate companies, in the preparation of separate financial statements.
The change in IAS 16 – Property, Plant and Equipment and in IAS 41 – Agriculture defines the concept of a plant that produces
consumable biological assets and transfers this type of assets from IAS 41 – Agriculture to IAS 16 – Property, Plant and Equipment, with
the consequent impact in its measurement. However, the biological assets produced by those plants are kept within IAS 41 – Agriculture.
The change in IFRS 11 – Joint Arrangements adds new guidelines in the way of accounting the acquisition of a share in a joint
venture that constitutes a deal.
The change in IAS 1 – Presentation of Financial Statements includes guidelines related with the materiality and aggregation, the
presentation of subtotals, the structure of the financial statements, the release of accounting policies and the presentation of the
items for other comprehensive income generated by investments measured by the equity method.
The improvements in norms 2012 – 2014 affect the following standards: IFRS 5 – Non-Current Assets Held for Sale and Discontinued
Operations, IFRS 7 – Financial Instruments: Disclosures, IAS 19 – Employee Benefits and IAS 34 – Interim Financial Reporting.
The company estimates that the future adoption of these standards will not have a significant impact in its consolidated financial
statements.
st
Standards effective on or after 1 February 2015, not yet endorsed by the European Union
At present, the following standards, interpretations, changes and revisions have already been issued but have not yet been
endorsed by the European Union:
EFFECTIVE DATE
Changes in IFRS 10, 12 and IAS 28: application of the exemption of consolidation
01-01-2016
IFRS 9 – Financial instruments
01-01-2018
IFRS 14 – Regulatory deferral accounts
01-01-2016
IFRS 15 – Revenue from contracts with customers
01-01-2018
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 
79
12
The changes in standards IFRS 10 – Consolidated Financial Statements, IFRS 12 – Disclosure of interests in other entities and IAS
28 – Investment in Associates clarify that the exemption to the obligation of consolidation applies to an intermediate holding
company that constitutes a subsidiary of an investment entity. Additionally, the option to apply the equity method, according to IAS
28, is extendable to an entity that is not an investment entity, but that owns an interest in an associate or joint venture that is an
investment entity.
IFRS 9 – Financial Instruments replaces the requirements of IAS 39, regarding: (i) the classification and measurement of financial
assets and liabilities; (ii) the recognition of impairment on accounts receivable (through the expected loss model); and (iii) the
requirements for acknowledgment and classification of hedge accounting.
IFRS 14 – Regulatory Deferral Accounts allows entities that adopt the IFRS for the first time to continue to register the regulatory
assets and liabilities according to the policy followed within the previous standards. However, to allow comparability with the entities
that already adopt the IFRS and do not register regulatory assets or liabilities, the referred amounts must be disclosed separately in
the financial statements.
IFRS 15 – Revenue from Contracts with Customers is applied only to contracts for the delivery of products or provision of services
and demands that the entity registers the revenue when the contractual obligation of delivering assets or render services is fulfilled,
by the amount that reflects the consideration to which the entity is entitled, as provided in the “five steps methodology”.
The company estimates that the future adoption of these standards will not have a significant impact in its consolidated financial
statements.
st
Standards and changes effective as of 1 January 2015
EFFECTIVE DATE
01-01-2015
IFRIC 21 – Levies
17-06-2014
Regarding the improvements in norms 2011 - 2013, these changes are the result of annual improvement projects implemented in
the 2011 - 2013 cycle, which affected the following standards: IFRS 1 – First-time Adoption of the International Financial Reporting
Standards, IFRS 3 – Business Combinations, IFRS 13 – Fair Value Measurement and IAS 40 – Investment Property. IFRIC 21
(new) is an interpretation of IAS 37 and of the registry of liabilities and clarifies that the past event that results in a payment
obligation of a rate or tax (except Income Tax) corresponds to the activity described in the relevant regulation that forces the
payment.
st
The effect in the Group’s financial statements for the period ending on 31 December 2015, arising from the adoption of the
standards, interpretations, amendments and revisions referred above was not material.
st
The 1 January 2004 corresponds to the Group’s first period of application of the IAS/IFRS, in accordance with IFRS 1 – First-time
adoption of the International Financial Reporting Standards.
The consolidated financial statements are presented in euros since this is the main currency of the Group’s operations. The
financial statements of Group companies expressed in foreign currency were converted to euros in accordance with the accounting
policies described in Note 1 xiv).
In the preparation of the consolidated financial statements, in accordance with IAS/IFRS, the Group’s Board of Directors adopted
certain assumptions and estimates that can affect the assets and liabilities reported, as well as the profits and losses incurred in the
reporting periods (Note 1 xxvi). All the Board of Directors’ estimates and assumptions were made taking into consideration the best
knowledge and available available at the financial statements’ approval date and the information.
The accompanying consolidated financial statements were prepared for appreciation and approval at the annual Shareholder’s
th
General Meeting. The Board of Directors approved them for issuance on 6 April 2016 and believes that these will be approved
without any changes.
80
12
BASIS OF CONSOLIDATION
The Group’s consolidation methods are as follows:
a) Group companies
Investments in the companies in which the Group owns, directly or indirectly, more than 50 % of the voting rights at the
Shareholder’s General Meetings and / or is able to establish the financial and operational policies (definition of control normally
used by the Group) are included in the consolidated financial statements using the full consolidation method.
The Equity and Net Profit attributable to minority shareholders are shown separately in the consolidated statement of financial
position (in the equity caption ‘non-controlling interests’) and in the consolidated income statement (included in the consolidated net
profit attributable to non-controlling interests) respectively. Companies included in the consolidated financial statements using the
full consolidation method are listed in Note 2.
st
In business combinations occurring after 1 January 2004, the assets and liabilities of each subsidiary (including contingent
liabilities) are measured at fair value on the date of acquisition as established in IFRS 3. Any excess / deficit of the cost of the
business combination over the Group’s interest in the fair value of the identifiable assets and liabilities acquired is recognized as
Goodwill or, when identified, added to the asset that originated such difference. Any excess of the Group’s share in the fair value of
the identifiable assets acquired over the cost of the business combination (Badwill) is recognized as income in the income
statement for the year, after the reassessment of the estimated fair value. Non-controlling interests include their proportion of the
fair value of net identifiable assets, liabilities and contingent liabilities determined at the date of acquisition of the Group companies.
st
In business combinations occurring after 1 January 2011 (IFRS 3R), any excess of the cost of the business combination, of the fair
value of any investment held before the acquisition of control and of the value of non-controlling interests, over the fair value of
assets, liabilities and identifiable contingent liabilities is recognized as Goodwill. If the cost of the business combination, the fair
value of any investment held before the acquisition of control and the value of non-controlling interests, is lower than the fair value
of the net assets of the subsidiary acquired, the difference is recognized in the income statement for the year. Transaction costs
arising in business combinations occurring after this date are recognized as an expense when incurred.
Transactions of disposal or acquisition of shares to / from non-controlling interests do not result in the recognition of gains, losses or
Goodwill and in any difference between the value of the transaction and the carrying value of the investment traded is recognized in equity.
The negative results generated in each period by subsidiaries with non-controlling interests are allocated, based on the percentage
held, to non-controlling interests, even if these become negative.
The non-controlling interests, recognized in business combinations, are measured at their respective proportion of the fair value of
identified net assets, transaction by transaction.
The results of the Group companies acquired or disposed of during the year are included in the consolidated income statement as
of the date of their acquisition and up to the date of their disposal.
Adjustments to the financial statements of Group companies are carried out, whenever necessary, in order to adapt their
accounting policies to those used by the Group. All intra-group transactions, balances and distributed dividends are eliminated in the
consolidation process. Whenever the Group has, in substance, control over other entities incorporated for a specific purpose, even if
st
no share capital interests are directly held in those entities, they are consolidated using the full consolidation method. On 31
December 2015, there are no entities in this situation.
b) Associate and jointly controlled companies
Investments in associate companies (companies in which the Group has significant influence but does not have control over the
financial and operational decisions - mainly investments representing between 20 % and 50 % of the company’s share capital) and
in jointly controlled companies (companies in which the Group shares control with other partners) are included in the accompanying
consolidated financial statements in accordance with the equity method in the caption ‘Investments in associate companies and
joint arrangements’.
Under the equity method, investments are recorded at cost, adjusted by the amount corresponding to the share of changes in
equity and net profit of associate and jointly controlled companies and by the dividends received, net of impairment losses.
The assets and liabilities of each associate and jointly controlled company (including contingent liabilities) are identified at their fair
value on the acquisition date. Any excess of the cost of acquisition over the Group’s share of the fair value of the identifiable assets
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and liabilities of the associate companies is recognized at the date of acquisition as Goodwill. This Goodwill is included in the
carrying amount of the investment in associate companies and joint arrangements and analysed annually for recoverability as part
of the financial asset. Any excess of the Group’s share of the fair value of the identifiable assets and liabilities over the cost of the
business combination (Badwill) after reassessment, is immediately recognized in the income statement.
An assessment of the investments in associate and jointly controlled companies is performed whenever there is evidence that the
asset might be impaired. Any impairment loss detected is recorded in the income statement.
When the Group’s share of losses exceeds the carrying amount of the investment, such investment is reported at nil value for as
long as the equity of the associate or jointly controlled company is negative, except when the Group has assumed commitments in
respect of the said associate or jointly controlled company (ies). In this case, a provision is recorded for those commitments.
The Group’s share of unrealized gains arising from transactions with associate and jointly controlled companies is eliminated.
Unrealized losses are eliminated, but only to the extent that there is no evidence of impairment of the assets transferred.
Investments in associate and jointly controlled companies which are consolidated using the equity method are listed in Note 2.
MAIN ACCOUNTING POLICIES, JUDGEMENTS AND ESTIMATES
The main accounting policies, judgements and estimates used in the preparation of the Group’s consolidated financial statements
for the periods presented are as follows:
i) Goodwill
The excess of the cost of acquisition over the Group’s interest in the fair value of the identifiable assets, liabilities and contingent
liabilities of subsidiaries, associate companies or jointly controlled companies at the date of acquisition, is recorded in the caption
‘Goodwill’ (in the case of investments in subsidiaries) or in the caption ‘Investments in associate companies and joint arrangements’
(in the case of investments in associate companies or jointly controlled companies).
st
Goodwill arising on acquisitions prior to the date of transition to IFRS (1 January 2004) or Goodwill arising from the constitution of
the Group is recorded at its net carrying amount, calculated in accordance with generally accepted accounting principles in
Portugal, and is subject, as of that date, to annual impairment tests.
Goodwill is not amortized but it is subject to impairment tests on an annual basis when its carrying amount is compared to its
recoverable amount. Impairment losses identified during the year are recorded in the income statement in the caption ‘Provisions
and impairment losses’. The recoverable amount is the highest between the fair value minus the cost to sell and minus the value in
use. The fair value minus the cost to sell is the amount that could be obtained in an arms-length transaction. The value in use is the
present value of the estimated future cash flows from the continuous use of such asset and from its sale at the end of its life-cycle.
The recoverable amount is estimated individually for each asset, or when this is not possible, for the cash-generating unit to which the
asset belongs.
ii) Non-current assets held for sale
Non-current assets are classified as held for sale if their carrying amount is to be recovered through a sale transaction rather than
through their continued use. Nevertheless, such classification requires that the sale be highly probable and that the asset (or
disposal group) is available for immediate sale in its present condition. In addition, the Board of Directors must be committed to the
sale, which should occur in the short-term (normally, but not exclusively, within one year from the date of that classification).
Non-current assets (and disposal groups) classified as held for sale are measured at the lowest of their carrying amount and their
fair value minus cost to sell and are not amortised or depreciated during the period they are classified as held for sale.
iii) Intangible assets
Intangible assets acquired by the Group are stated at their acquisition cost, net of depreciation and accumulated impairment losses.
Intangible assets are only recognized if they are controlled by the Group and if their cost can be reliably measured.
Intangible assets comprise mainly software and other rights, which are depreciated on a straight-line basis over a 3-year period, and
costs incurred obtaining licences to explore wind farms, which are depreciated in line with the granted license period (currently 20 years).
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Costs incurred with the licensing of wind farms are recognized as intangible assets if, and only if, all of the following requirements
have been fulfilled:
- economic feasibility studies confirm that the wind farms will generate future economic benefits;
- the Group has the technical and financial capacity to install and explore those wind farms; and
- the expenditure attributable to the wind farms during the licencing phase can be reliably measured.
Expenditure on research and installation activities related with wind farms is recognized as an expense in the year in which it is incurred.
The remaining research expenses are recognized as costs in the year in which they are incurred.
Intangible assets acquired in a business combination are identified and recognized separately from Goodwill if their fair value can be
reliably measured. The cost of such intangible assets is the fair value on the acquisition date.
Subsequent to initial recognition, intangible assets acquired in a business combination are recorded at cost minus accumulated
amortization and minus impairment losses, on the same basis as intangible assets acquired separately. These assets are
depreciated on a straight-line basis, usually during the period over which the economic benefits are expected to occur.
iv) Tangible assets
Tangible assets are recorded at their acquisition cost, net of depreciation and accumulated impairment losses.
The Group did not register provision for the dismantling of wind farms or solar parks, since it does not currently have any legal or
contractual obligation to dismantle these assets.
Depreciation is calculated on a straight-line basis over the assets’ life-cycle, and land is not subject to depreciation.
Tangible assets in progress are fixed assets still under construction / development and are recorded at their acquisition cost, net of
impairment losses. Those assets are depreciated as of the moment they become available for use with the quality and technical
conditions required to operate efficiently. Depreciation is calculated on a straight-line basis, over the expected useful life for each
class of tangible assets. The useful life is estimated taking into consideration the expected use of each class of tangible assets, as
well as their natural consumption and technical obsolescence.
The depreciation rates used correspond to the following estimated life-cycles:
Buildings
Equipment:
Basic equipment
Transportation equipment
Tools and dies
Office equipment
Other tangible assets:
Equipment installed in wind farms and solar parks
Other tangible assets
20 to 50 years
3 to 7 years
4 to 5 years
3 to 5 years
3 to 10 years
15 to 20 years
3 to 10 years
Maintenance and repair costs that neither increase the life-cycle nor create significant improvement in tangible assets are
recognized as costs in the year in which they occur.
v) Leasing
Leases are classified as (i) finance leases whenever the terms of the lease substantially transfer all the risks and rewards of
ownership to the lessee. All other leases are classified as (ii) operating leases.
A lease is classified as finance or operating depending on the substance of the transaction rather than on the form of the contract.
Fixed assets acquired under finance lease contracts and the related liabilities are recorded in accordance with the financial method.
Under this method the tangible assets, the corresponding accumulated depreciation (as defined in iii) and iv) above) and the
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liabilities are recorded in accordance with the contracted financial plan. In addition, the interest included in lease payments and the
depreciation of the tangible assets are both recognized as expenses in the income statement of the year to which they relate.
Assets under long-term rental contracts are recorded in accordance with the operational lease method. In accordance with this
method, the rents paid are recognized as expenses over the rental period.
vi) Investment properties
An investment property is a property held to earn rentals and / or for capital appreciation and not for use in the course of current
operations.
Investment property is initially measured at cost, including transaction costs. Subsequent to the initial recognition, investment
property is measured at fair value, and gains or losses arising from changes in the fair value are included in the income statement
of the period in which they arise.
Costs incurred with investment property (maintenance, repair, insurance and property tax), as well as the related revenue and
rental income are included in the income statement of the period in which they arise.
vii) Financial assets and liabilities
Financial assets and liabilities are recognized in the Group’s statement of financial position when, and only when, the Group is a
contractual party to the instrument.
a) Financial instruments:
The Group classifies financial instruments in the following categories: ‘Financial investments at fair value through profit or loss’,
‘Borrowings and receivables’, ‘Held-to-maturity investments’ and ‘Available-for-sale investments’. The classification depends on
the intention inherent to the investment’s acquisition.
The classification is made at the initial recognition and re-appreciated on a quarterly basis.
 Financial assets at fair value through profit or loss: this category is divided into two: ‘financial assets classified as held for
trading’ and ‘financial assets designated by the Group at fair value through profit or loss’. A financial asset is classified under
this category, namely if it is acquired for the purpose of selling it in the short-term. Derivatives are also classified as
instruments held for trading, except if designated as effective hedging instruments. Financial instruments in this category are
classified as current if they are held for trading or if it is expected that they are going to be realized within twelve months of
the end of the reporting period;
 Held-to-maturity financial assets: this category includes financial assets, non-derivative, with fixed or variable
reimbursements with a fixed maturity, and which the Board of Directors intends to hold to maturity.
 Available-for-sale financial assets: these include financial assets, non-derivative, that are designated as available-for-sale
and those that are not classified as ‘borrowings and receivables’, ‘held-to-maturity investments’ or ‘financial assets at fair
value through profit or loss’. This category is classified as non-current, unless the Board of Directors intends to sell them
within 12 months from the end of the reporting period.
Held-to-maturity financial assets are classified as non-current, unless their maturity is less than a year from the end of the
reporting period. Financial assets designated by the Group at fair value through profit or loss are classified as current in the
statement of financial position.
All purchases and sales of financial instruments are recognized on the trade date, this means on the date when the Group assumes
the risks and obligations inherent to the acquisition and disposal of the assets. These investments are initially measured at cost,
which is the fair value of the consideration paid for it, including transaction costs, with the exception of ‘Financial investments at
fair value through profit or loss’. In the latter, the financial assets are initially recognized at their fair value and the transactions
costs are recognized in the income statement. Financial investments are derecognized when the right or obligation to receive or
pay financial flows, respectively, has expired or has been transferred, and therefore, all the risks and benefits have been
transferred.
‘Available-for-sale financial assets’ and ‘Financial assets at fair value through profit or loss’ are subsequently measured and
recorded in the financial statements at fair value.
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Gains and losses, realized or not, resulting from a change in the fair value of the ‘Financial investments at fair value through profit
or loss’ are recognized in the income statement of the year. Gains and losses resulting from a change in the fair value of
‘Available-for-sale assets’ are recognized directly in the statement of comprehensive income, under the caption ‘Fair value
reserves – Available-for-sale assets’ until the investment is sold, received or in any way alienated, at which moment the
accumulated gain or loss is recognized in the income statement.
The fair value of financial assets is based on current market prices. If the market on which the investments are traded is not active
(no quoted price exists), the Group establishes the instrument’s fair value using other valuation techniques such as recourse to
similar transactions, discounted cash flow analysis or the use of option pricing models to reflect the specific circumstances. The
fair value of listed investments is calculated using the closing price on Euronext Lisbon at the end of the reporting period.
To determine the fair value of a financial asset or liability when there is an active market, the market price is applied. This
constitutes level 1 of the hierarchy of fair value, as defined in IFRS 13 – Fair value: mensuration and disclosure.
If the market on which the investments are traded is not active, which is the case of some financial assets and liabilities, valuation
techniques generally accepted in the market, based on market assumptions, are used. This constitutes level 2 of the hierarchy of
fair value, as defined in IFRS 13.
The entity applies valuation techniques for unlisted financial instruments, such as derivatives, financial investments at fair value
through profit or loss and available-for-sale investments. The most frequently used valuation models are discounted cash flow
analysis and option valuation models which incorporate market information such as interest rate curves.
For some complex financial instruments, complex valuation models with assumptions and information that is not directly
observable in the market, and for which an entity applies internal estimates and assumptions, are used. This constitutes level 3 of
the hierarchy of fair value, as defined in IFRS 13. ‘Borrowings and receivables’ and ‘Held-to-maturity investments’ are recorded at
their amortized cost using the effective interest rate method.
Financial assets are assessed, by the Group, for indicators of impairment at each reporting period. In the case of equity
instruments classified as available-for-sale, a significant decline or a prolonged decline in their fair value to amounts lower than
their acquisition cost, are indicators of impairment. For all other financial assets objective evidence of impairment could include:
 significant financial difficulty of the issuer or counterparty; or
 default or delinquency in interest or main payments; or
 it becoming probable that the borrower will enter bankruptcy or financial restructuring.
For financial assets carried at amortized cost, the amount of the impairment is the difference between the asset’s carrying amount
and the present value of the estimated future cash flows, discounted at the financial asset’s original effective interest rate.
The carrying amount of the financial assets is reduced directly by the impairment losses for all financial assets with the exception
of trade and other receivables, for which the carrying amount is reduced through the use of an allowance account. When a trade
or other receivable is considered uncollectable, it is written-off against the allowance account. Subsequent recoveries of amounts
previously written-off are credited in the income statement for the period. Changes in the carrying amount of the allowance
account are recognized in the income statement in the caption ‘Accumulated impairment losses’.
With the exception of ‘Available-for-sale investments’, which correspond to capital instruments in another company, if in a subsequent
period the amount of the impairment loss decreases and the decrease can be objectively related to an event occurring after the
impairment was recognized, the previously recognized impairment loss is reversed through the income statement.
b) Trade receivable and other receivables
Trade and other debtors balances do not bear interest and are recorded at their nominal value minus any impairment losses,
recognized in the allowance account ’Accumulated impairment losses‘, in order to reflect their net realizable value.
c) Borrowings
Borrowings are recorded as liabilities at their nominal value, net of up-front fees and commissions related with the issuance of
these instruments. Financial expenses are calculated based on the effective interest rate and are recorded in the income
statement on an accruals basis.
d) Trade payables and other payables
Accounts payable that do not bear interest are recorded at their nominal value, which is substantially equivalent to their fair value.
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e) Financial liabilities and equity instruments
Financial liabilities and equity instruments are classified and accounted for based on their contractual substance. The Group
classifies as equity instruments the contracts that evidence the Group’s residual interest in a group of assets after deducting all of
its liabilities. The Group classifies as financial liabilities all those that are expected to give rise to a disbursement of funds.
f) Derivatives
The Group uses derivative instruments to manage its exposure to financial risks. Derivative instruments are only used for hedge
accounting purposes, with the appropriate approval of the Group’s Board of Directors, and never for speculative purposes.
The derivative instruments used by the Group, classified as cash flows hedges, are exclusively related to the hedging of interest
rates and exchange rates on loans obtained. The loan’s amount, the interest’s maturity and the loan’s reimbursement plans
inherent to the hedging instrument are in all respects similar to the established conditions for the contractual loans, configuring
totally effective correlations.
The criteria used by the Group to classify the derivative instruments as cash flow hedges are as follows:




The hedge is expected to be highly effective in offsetting changes in the cash flows attributable to the hedged risk;
Hedge effectiveness can be reliably measured;
There is adequate documentation on the transaction at the inception of the hedge;
The transaction to be hedged is highly probable.
Cash flow hedges are initially recorded at fair value, if any, and subsequently revaluated at their fair value. The effective portion of
the changes in the fair value of derivatives that are designated and qualify as cash flow hedges is deferred in the statement of
comprehensive income in the caption ‘Fair value reserves – Cash flow hedge derivatives’, being transferred to results in the same
periods the hedged instruments affect these. The gains or losses relating to the ineffective portion are immediately recognized in
the income statement, when determined.
Hedge accounting is discontinued when the hedging instrument expires or is sold. When a hedging instrument no longer qualifies
for hedge accounting, the accumulated gain or loss deferred in the statement of comprehensive income remains in equity and
subsequent revaluations of the derivative are recorded in the income statement.
g) Green certificates
Green certificates are instruments that approve the production of a certain volume of electricity from renewable energy sources.
In Romania, green certificates of two types were attributed to Martifer Renewables: certificates available for transaction (valid for a
12-month period since their emission date) and suspended green certificates (that can be traded from 2018 on).
At the date of the publication of the financial statements, there is no accounting standard or interpretation in the International Financial
Reporting Standards (IFRS) that deals specifically with the accounting for emission permits or renewable energy certificates.
Upon receipt of the green certificates, the company recognizes an asset under “Available-for-sale investments” or under “Other
current financial assets” (depending on the type of certificate) as well as its corresponding “Deferred income”. The deferred income
is recorded in the income statement when the green certificates are sold. At the end of each period, the green certificates are
valued using their fair value, which corresponds to their market price on that date. The differences arising are recorded in the
income statement as “Other financial income” or as “Other financial expenses”. The value of the reversed certificates, for lack of
use before the expiration date, will be registered under “Other financial expenses”.
h) Notes receivable and factoring
The Group only derecognizes a financial asset when, and only when, the contractual rights to the cash flows from the financial
asset expire; or it substantially transfers the contractual risks and rewards inherent to the possession of such financial asset to a
third party. If the Group substantially retains the risks and benefits inherent to the possession of such assets, it continues to recognizes
these in its financial statements, recording a liability in the caption ‘Borrowings’ as the monetary collateral for the assets transferred.
Therefore, notes receivable and factored accounts receivable are recorded at each reporting period as liabilities in the statement of the
financial position, with the exception of ‘non-recourse factoring’ operations, until the underlying assets are fully collected by the Group.
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viii) Cash and cash equivalents
Cash and cash equivalents include cash on hand, cash at banks, term deposits and other treasury applications with a maturity of
less than three months, which are subject to an insignificant risk of change in value.
ix) Inventories
Merchandise, subsidiary and consumable raw-materials are stated at the lowest of their average acquisition cost or net realizable
value (estimated sales price less cost to make the sale). Finished and intermediate goods are recorded at production cost (which
includes the cost of incorporated raw-materials, direct labour and overheads), which is lower than their market value.
Impairment losses are recognized in the income statement when it is estimated that the inventories’ net realizable value is lower
than its carrying amount (Note 10).
x) Accrual basis
Expenses and income are recorded in the year to which they relate, regardless of their date of payment or receipt. The captions of
’Other non-current assets’, ‘Other current assets’, ‘Other non-current liabilities’ and ‘Other current liabilities’ include expenses and
income relating to the current period, whose payment and receipt will occur in future periods, as well as payments and receipts in
the current period but which relate to future periods.
xi) Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. Revenue is recorded net of returns, rebates and
similar allowances.
a) Construction contracts (metallic structure constructions and the construction of turnkey wind farms and solar parks)
The Group recognizes income and costs associated with construction contracts, on an individual basis, using the stage of
completion method. Under this method, at the end of each period, income and expenses are recognized with reference to the
stage of completion of the contract activity. The stage of completion is determined based on the ratio between costs incurred to
the balance sheet date and the total estimated contract costs.
The difference between income determined applying this ratio and the total amount invoiced is recorded in ‘Other current assets’
as ‘Work in progress’ or in ‘Other current liabilities’ as ‘Advanced invoicing’.
Revenue arising on contract variations is recorded when these are agreed with the customer, or when negotiations are at an
advanced stage and it is probable that these will be favourable to the Group, and it can be reliably measured.
To cater for the costs that will be incurred during the guarantee period, the Group recognizes a provision, created on an annual
basis, to cover for such legal obligation. This provision is estimated taking into consideration the annual production as well as the
historical costs incurred in the past with this obligation.
Claims for reimbursement of expenditure not covered in the contract price are included in the contract revenue when negotiations with
the client are at an advanced stage and it is probable that these will be favourable to the Group and that they can be reliably measured.
When it is likely that the total estimated costs of the construction contract will exceed the revenue negotiated, the expected loss is
immediately recognized in the income statement.
b) Short-term construction contracts
In these types of contracts, the Group recognizes revenue and costs as they are billed or incurred, respectively.
c) Recognition of revenue resulting from real estate activity
Relevant costs incurred with real estate projects include the direct construction costs, the costs associated with the realization of the
projects as well as their licensing costs. Borrowing costs attributable to real estate projects are capitalized until the project is completed.
Borrowing costs are only capitalized if the project is in progress, i.e. if it is awaiting licenses from local authorities, or if it is under
construction. In all other cases, it is considered to be suspended and no capitalization of borrowing costs occur.
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Revenue on these types of operations is generated and recognized when the contractual position held by the Group is
transferred, which, generally, coincides with the signing of the transfer deed.
d) Revenue recognition related with the sale of goods (merchandise and finished products)
Revenue from the sale of goods is only recognized when all the following conditions are met:
 the Group has transferred to the buyer the significant risks and rewards of ownership of the goods;
 the Group neither retains continuing managerial involvement to the degree usually associated with ownership nor effective
control over the goods sold;
 the amount of revenue can be reliably measured;
 it is probable that the economic benefits associated with the transaction will be handed to the entity; and
 the costs incurred or to be incurred related to the transaction can be reliably measured.
xii) Own worked capitalized
The internal costs (materials, staff and production costs) incurred during the production of tangible fixed assets are capitalized only
when the following requirements are fulfilled:
 the underlying assets are identifiable;
 there is strong probability that the assets will generate future economic benefits; and
 the production costs can be reliably measured.
xiii) Costs incurred with proposal preparation
Costs incurred with proposal preparation are recognized in the income statement as they are incurred due to the unpredictability of
their outcome.
xiv) Balances and transactions in foreign currency
Individual financial statements:
All the assets and liabilities expressed in foreign currencies are translated to the functional currency, using the official exchange
rates at the reporting date. The exchange differences, favourable or unfavourable, originated by the differences between the
exchange rates on the transaction dates and those used at the collection, payment or in the reporting period, are recognized in their
gross amounts as profits and losses in the income statement of the period.
Consolidated financial statements:
Assets and liabilities of the Group’s foreign operations are translated into Euros using the exchange rates prevailing at the reporting
date in the preparation of the consolidated financial statements. Income and expense items, as well as cash flows, are translated at
the average exchange rates of the year. In addition, some medium-, long-term or undefined maturity loans granted to subsidiaries,
denominated in a currency other than the Euro are considered as part of the Group's net investment. Whenever exchange
differences arise, they are recorded in equity and recognized in the Group’s foreign currency translation reserve. Such exchange
rate differences are recognized in the income statement in the year in which the foreign entity is disposed.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign
entity and therefore, are translated at the closing rate.
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The following exchange rates have been used in the preparation of the financial statements:
1 € EQUALS:
CLOSING RATE
AVERAGE RATE
31 DECEMBER
2015
31 DECEMBER
2014
Australian dollar
1.490
Polish zloty
4.264
New Romanian leu
US dollar
South African Rand
Brazilian real
Thai Baht
EVOLUTION IN %
31 DECEMBER
2015
31 DECEMBER
2014
EVOLUTION IN %
1.483
0.5%
1.478
1.472
0.4%
4.273
-0.2%
4.184
4.184
0.0%
4.524
4.483
0.9%
4.445
4.444
0.0%
1.089
1.214
-10.3%
1.110
1.329
-16.5%
16.953
14.035
20.8%
14.172
14.404
-1.6%
4.312
3.221
33.9%
3.700
3.121
18.6%
-11.9%
39.248
39.910
-1.7%
38.028
43.147
Angolan kwanza
146.120
124.910
17.0%
132.733
130.294
1.9%
Moroccan dirham
10.740
10.990
-2.3%
10.808
11.151
-3.1%
0.734
0.779
-5.8%
0.726
0.806
-10.0%
-3.2%
Pound sterling
Canadian dollar
1.512
1.406
7.5%
1.419
1.466
Mozambique metical
50.500
40.100
25.9%
43.134
41.135
4.9%
Mexican peso
18.915
17.876
5.8%
17.616
17.655
-0.2%
-16.3%
Saudi Riyal (Saudi Arabia)/ SAR
4.083
4.560
-10.5%
4.169
4.982
768.728
737.820
4.2%
726.296
756.857
-4.0%
26.045
18.975
37.3%
24.105
15.634
54.2%
217.228
-
-
199.424
-
-
0.769
-
-
0.786
-
-
131.070
145.230
-9.8%
134.314
140.306
-4.3%
Peruvian Sol
3.700
3.631
1.9%
3.525
3.767
-6.4%
Turkish Lira
3.176
2.832
12.2%
3.025
2.906
4.1%
Chilean Peso
Hryvna (Ukraine)
Venezuelan Bolívar
Jordan dinar
Japanese Yen
xv) Income tax
Income tax for the period includes the current and deferred income tax, in accordance with IAS 12. Current income tax is calculated
based on taxable profits and taking into consideration the local tax laws applicable to each Group company.
Deferred tax is recognized on timing differences arising between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax base used in the calculation of taxable profit, as well as on certain tax credits attributed to the
Group, and is accounted for using the balance sheet liability method.
Deferred tax assets and liabilities are measured and annually revalued at the tax rates expected to apply in the period in which the
liabilities are settled or the assets are realized, based on tax rates (and tax laws) enacted or substantially enacted.
Deferred tax assets are generally recognized for all deductible timing differences to the extent that it is probable that taxable profits
will be available against which those deductible timing differences can be used. The carrying amount of deferred tax assets is
reviewed at each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be
available to allow for all or part of the asset to be recovered.
The deferred tax amount resulting from transactions or events recognized directly in equity is also registered directly in equity, not
affecting the income for the year.
xvi) Borrowing costs
Borrowing costs are recorded in the income statement on an accrual basis.
Borrowing cost related to loans obtained to finance the construction of tangible fixed assets and some inventories (real estate projects)
are capitalized, forming part of the asset’s carrying amount. The capitalization begins when the preparation of the construction activity
starts and ceases when the asset enters into use, at the end of its production or construction or when the project is suspended.
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xvii) Provisions
Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable
that the Group will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. These
provisions are reviewed at each reporting period and are adjusted to reflect the best estimate at the date, taking into consideration
all the risks and uncertainties inherent to such estimates. When a provision is determined using the future cash flows estimated to
settle the present obligation, its carrying amount is the present value of those cash flows.
The provisions recognized by the Group result mainly from:
i)
Construction guarantees
The Group recognizes a provision for the costs estimated to be incurred in the future with construction guarantees provided on metallic
structures or farms (wind or solar) that were sold. This provision is recognized on the date of the sale or when the service is
rendered, thus affecting the profit made on the deal. At the end of the guarantee period (a 5-year average) any remaining amount of
provision is reversed in the income statement.
ii)
Onerous contracts
The Group recognizes a provision for onerous contracts when, for construction contracts in progress, it is established that the costs
to be incurred to satisfy the obligation assumed exceed the future economic benefits. This analysis is made on a contract by
contract basis, based on information provided by the project managers.
iii)
Legal claims in progress
A provision for legal claims in progress is recognized when there is a reliable estimate of the costs to be incurred as a consequence
of lawsuits proposed by third parties.
iv)
Financial assets accounted for under the equity method
A provision is recognized whenever an associate or jointly controlled company has a negative equity and it is considered that the
Group has assumed responsibilities over and above its share of the capital.
xviii) Government grants
Grants received for staff training programmes and new hiring actions are recognized as income in the same period the relevant
expenses are incurred.
Grants received to finance tangible fixed asset investments are recorded as deferred income and are recognized as income, in the
caption ‘Other operating income’, on a straight-line basis over the expected life-cycle of the underlying assets.
xix) Impairment of tangible and intangible assets excluding Goodwill
At each reporting period and whenever an event or change in circumstance is identified, the Group reviews the carrying amounts of
its tangible and intangible assets to determine whether there is any indication that these assets are impaired. When the asset
carrying amount is greater than its recoverable amount, an impairment loss is recognized and recorded in the caption ‘Impairment
losses’. The recoverable amount is the higher of fair value less cost to sell and value in use. The fair value less cost to sell is the
amount that could be obtained in an arms-length transaction. Value in use is calculated by assessing the estimated future cash
flows generated by the asset discounted to the present value, taking into consideration its residual value. When it is not possible to
estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to
which the asset belongs.
The reversal of impairment losses recorded in previous years is recognized when the underlying reasons that caused that entry are
no longer applicable and, consequently, the asset is no longer impaired. The reversal of impairment losses is recognized in the
income statement as an operating result. However, the reversal of an impairment loss is performed just up to the limit of the amount
that would be recorded through the historical cost, or through the revalued amount, net of amortization and depreciation, if the
impairment loss had not been recorded in previous years.
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12
xx) Employee benefits
Variable remuneration
According to the statutes of some Group companies, the shareholders of those companies approved at the General Meeting or
within a Remuneration Committee elected by the shareholders, the fixed and variable remuneration to be distributed to the
members of governing bodies. Bonus payments are recorded in the period to which they relate.
xxi) Statement of financial position presentation
Assets to be realized and liabilities to be settled twelve months after the reporting date are classified as non-current. Likewise, given
their nature, ‘Deferred taxes’ and ‘Provisions’ are classified as non-current in the statement of financial position.
xxii) Contingent assets and liabilities
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.
Contingent assets are not recorded in the consolidated financial statements but are disclosed when future economic benefits are probable.
xxiii) Consolidated cash flow statement
The consolidated cash flow statement is prepared using the direct method, according to IAS 7. The Group classifies as ‘Cash and cash
equivalents’ applications which mature in less than three months and which are subject to an insignificant risk of change in value.
The consolidated cash flow statement is classified into operating, investing and financing activities. Operating activities include cash
receipts from clients, cash payments to suppliers, cash payments to and on behalf of employees and other operating activities’
payments and receipts. Investing activities’ cash flows include, essentially, payments and receipts related with acquisitions and
sales of tangible and intangible assets and investments.
Financing activities’ cash flows include, essentially, payments and receipts of loans and borrowings, financial lease contracts and
dividend payments.
xxiv) Subsequent events
Events occurring after the reporting period that provide further evidence of conditions existing at the end of the reporting period
(“adjusting events”), are recognized in the consolidated financial statements. Events occurring after the reporting period that are
indicative of conditions occurring after the end of the reporting period (“non-adjusting events”), if material, are disclosed in the notes
to the consolidated financial statements.
xxv) Judgements and estimates
In the process of preparing the Group’s consolidated financial statements the Board of Directors used its best knowledge and
accumulated experience in past and / or current events in making certain assumptions as to future events.
st
The most significant accounting estimates reflected in the consolidated financial statements for the years ended on 31 December
2015 and 2014 include:







The life-cycle of the tangible assets;
Fair value of the investment properties;
Impairment analysis of goodwill;
Recognition of provisions and impairment losses;
Revenue recognition on construction contracts and guarantees;
Recognition of deferred tax assets arising from tax losses;
Fair value of derivatives.
The estimates used were based on the best information available during the preparation of the consolidated financial statements
and on the best knowledge of past and present events. Although future events are neither controlled by the Group nor foreseeable,
some can occur and have an impact on the estimates. Changes to the estimates used by the Board, that occur after the date of these
consolidated financial statements, will be recognized in net income, in accordance with IAS 8, using a prospective methodology.
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xxvi) Financial risk management
Financial markets include a high degree of uncertainty, to which the Group is exposed. This uncertainty is translated into several
risks, to which the Group is exposed, namely price risk, currency risk, interest rate risk, liquidity risk and credit risk.
a) Price Risk
The volatility of the prices of raw materials constitutes a risk for the Group, both in the metallic constructions and in the solar areas.
The antidumping measures / charges that the European Union decided to implement on steel and aluminium products with origin in
China brought a great uncertainty regarding price, which will affect the operational activity of the metallic constructions business
area. Concerning the market trend on solar panel prices, they kept constant; however, their variation may also influence the solar
activity. Martifer has sought to mitigate this risk the same way in both areas, by including clauses in the contracts with customers
that allow it to pass on raw-material price fluctuations and by negotiating fixed prices for large scale projects with its suppliers.
b) Currency Risk
Currency risk has a strong correlation with the other types of risks, with highlight to its relation with countries’ risk, through the
evolution of economies and their impact in inflation and interest rates, and with credit risk, via currency fluctuations that may
jeopardize future financial flows, reflecting the possibility of registering gains or losses resulting from changes in the foreign
exchange rates between different currencies.
The Group’s internationalization forces it to be exposed to currency risk from different countries.
Exposure to currency risk results mainly from operational activities (in which expenses, income, assets and liabilities are expressed
in a currency other than the reporting currency of the Group), from transactions between these subsidiaries and other Group
companies and from the existence of transactions with external parties made by the operational companies in a currency other than
the reporting currency of the Group.
Concerning exchange rates’ hedging, hedges are sporadic as their cost is sometimes considered excessive in relation to the risk
level involved. However, whenever considered suitable, the Group contracts exchange rates hedging in order to cover the risk.
During 2015, as a result of the severe economic and financial crisis Angola has been facing, largely explained by the significant
drop in oil prices, there was a huge shortage of tradable currency in the Angolan market, causing limitations in the financial flows
coming from this geography.
The Group has been trying to mitigate this risk through financial instruments presented by its clients (e. g. letters of credit) in order
to maintain the regular financial flow.
The relevant amounts of the Group’s assets and liabilities recorded in a currency other than the Euro are as follows:
ASSETS
1 € EQUALS:
LIABILITIES
FY 2015
FY 2014
FY 2015
FY 2014
161,612,233
153,491,552
80,752,203
80,784,186
Zloty (Poland)
45,098,567
48,873,273
55,248,476
72,153,956
US Dollar (the USA)
68,136,067
58,399,403
100,758,256
91,895,201
Kwanza (Angola)
51,758,761
47,788,457
40,866,935
35,859,913
Real (Brazil)
11,362,507
58,631,399
3,083,794
32,374,745
1,498,646
811,748
1,386,124
1,377,394
97,042
628,133
560,015
4,633,416
-
22,477
-
6,912
34,628,343
52,449,377
29,992,917
49,565,474
New leu (Romania)
Moroccan dirham (Morocco)
Australian dollar (Australia)
Czech koruna (Czech Republic)
Pound sterling (the United Kingdom)
Mexican Peso (Mexico)
4,307,723
2,402,537
2,626,470
14,610,584
21,815,654
16,923,521
19,995,294
16,488,074
143,577
483,099
284,187
670,552
Metical (Mozambique)
54,114
-
461,719
-
Rand (South Africa)
28,586
-
273,634
-
Saudi Riyal (Saudi Arabia)
Hryvnia (Ukraine)
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12
If a negative change of 1 p.p. in the foreign exchange rates of the currencies just identified was to occur, the likely impact on the
Group’s financial statements might be as follows (amounts in Euro):
1 € EQUALS:
LOCAL CURRENCY
CHANGE AGAINST
EURO
FY 2015
FY 2014
IMPACT ON
PROFITS
IMPACT ON
EQUITY
IMPACT ON
PROFITS
IMPACT ON
EQUITY
New leu (Romania)
1%
26,864
(800,594)
208,991
(719,875)
Zloty (Poland)
1%
2,543
100,494
46,437
230,502
US Dollar (the U.S.A.)
1%
(2,090)
322,992
355,801
331,642
Pound sterling (the United Kingdom)
1%
42,967
(45,895)
23,439
(28,553)
Czech koruna (Czech Republic)
1%
-
-
719
(154)
Moroccan dirham (Morocco)
1%
(6,801)
(1,114)
(169)
5,600
Australian dollar (Australia)
1%
(1,389)
4,584
5,960
39,656
Kwanza (Angola)
1%
(13,494)
(107,840)
(16,013)
(118,104)
Real (Brazil)
1%
39,299
(81,967)
(75,308)
(259,967)
Mexican Peso (Mexico)
1%
(9,269)
(16,646)
89,631
120,872
Saudi Riyal (Saudi Arabia)
1%
(12,560)
(18,023)
(3,671)
(4,311)
Hryvnia (Ukraine)
1%
647
1,392
7,323
1,856
Metical (Mozambique)
1%
1,183
4,036
-
-
Rand (South Africa)
1%
-
2,426
-
-
c) Interest Rate Risk
The cost of financial debt contracted by the Group is indexed to short term base rates, reviewed with a year or less frequency, plus
a negotiated risk premium. Therefore, variations in interest rates may affect the Group’s results.
the Group faces a risk of fair value variation on these assets or liabilities, since every change in market rates involves an
opportunity cost. In the second case, such change has a direct impact on interest value, consequently causing cash variations.
In more significant medium and long-term loans and whenever it considers it appropriate the Group relies, when it considers it
appropriate, on fixed interest rate loans or uses interest rate derivatives to hedge exposure to interest rate risk them. The amounts,
interest due dates and repayment schedules of the loans underlying the interest rate derivatives are identical to those of the loans
they hedge, and so being they are considered perfect hedges.
During 2015, the reference interest rates in the euro area remained at very low levels, even reaching negative values at the end of the
year. According to the European Central Bank projections published on March 2016 (“March 2016 ECB staff macroeconomic
projections for the euro area”), rates should remain at very low levels during 2016 and 2017, with a modest growth expected for 2018.
th
premium rates (spread) to very competitive values, allowing a lower exposure to interest rate risk. This change in the bank financing
st
pricing took effect as of 1 January 2015. This factor, together with the expected stability in the reference rates contribute to
Martifer’s current low exposure to interest rate risk.
The analysis of the sensitivity to variation for more or less 1 p.p. in interest rate is presented in Note 30 - ‘Borrowings’.
d) Liquidity Risk
As mentioned above, at the end of 2015 the Group restructured its debt with financial institutions, through the rescheduling of bank
financing repayments over time, increasing the debt maturity in order to make it coincide with the long term assets’ continuity and,
at the same time to allow the cash surpluses to be sufficient to comply with its responsibilities.
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12
Therefore, and having in mind the medium / long term features of the investments made, the debt service accompanies the maturity
of the associated assets, not jeopardizing the commitments from its short term operational activity in the pursuit of the Group’s goal
st
As a consequence of the previously mentioned measures, it is verifiable that on 31 December 2015 the Current Assets largely
surpass the Current Liabilities. Therefore, the liquidity risk is quite reduced, due to Martifer’s capacity to transform its short term
The financial department accompanies the implementation of the risk management policies defined by the Board, in order to ensure
that the economic and financial risks are identified, measured and managed according to those policies.
e) Credit Risk
The Group undergoes credit risk in its operational activity – Trade Receivables and Other Receivables.
ensuring the collection of the amounts due within the negotiated periods.
manages cases in litigation, procedures which are all considered essential to manage the credit conceded and to minimize the risk
of credit default.
The rating of the financial institution of the Group’s cash is as follows:
MOODY'S RATING
Not rated*
AMOUNT OF CASH
12,787,164
A1
3,575,271
A2
2,529,049
A3
15,883
AA2
25,912
B1
1,426,560
BA1
3,298,115
BA3
1,061,038
BAA1
622,292
BAA3
166,223
CAA1
15,042,040
Total
40,549,549
* In ‘Not Rated’ are considered 10 million euros of Angolan financial institutions
xxvii) Operational Risk Management
a) Metallic Constructions
divided into three risk sources – client, supplier and external risks, which in turn are sub-divided into specific problems.
Under the client risk one can identify, for example, issues at the contractual level, such as the lack of convergence in the
interpretation and application of the contractual dispositions, the distaste or dissatisfaction with the service / product and also the
risk of non-payment of the price stipulated following the delivery of the projects.
94
12
Under the supplier risk, Martifer Construções, as a specialist in engineering projects, relies on subcontractors very often. If these fail
in the execution of their work the project’s delivery deadline cannot be met, in a domino effect. In other words, there is also a risk of
Arabia, which will allow to compensate both the effects of the economic recession in Portugal and the economic slowdown in Europe.
b) Solar
of equipment may disrupt the initially foreseen schedule for the completion of the respective projects. Despite the fact that this type
difficulties it can present.
the Group, currently being adopted, shall reduce the possible impact of this situation.
with a resulting dependency risk on key raw-material suppliers. The Group has sought to mitigate this risk by establishing long-term
c) Renewables
revenues (price and volume of energy produced by the assets). The equipment use and other exogenous factors, such as the wind
that in turn depends on the farm location, influence the energy production and consequently its results. Whenever the wind speed is
below or above the equipment limits, no energy is produced. These limits vary according to the manufacturer and type of turbine.
Additionally, each turbine has a power curve that determines the generated power at each wind speed.
velocity variations at each farm and ensuring the relative stability of the volume of total energy produced.
Regarding solar photovoltaic energy, the exogenous factors are more easily forecasted and therefore the revenue variation is minimized.
LICENCING:
Wind farms and solar parks are subject to rigorous regulations in matters such as their development, construction, licensing and
95
12
xxviii) Legal Risk Management
Martifer is subject to the national and local laws and regulations in the various geographies and markets where it operates. These aim to
ensure, among other, labour rights, environment protection, spatial planning and the maintenance of an open and competitive market.
Thus, the legal and regulatory changes that affect the conditions conducive to the development of the Groups’ activities and that
consequently harm or impede the attainment of the strategic objectives, require the Company to adapt to the new regulatory realities.
respective activities, which operate in the dependence of the Board of Directors and management, conducting their work in
of the stakeholders’ interests, in strict compliance with their legal duties.
The members of the legal departments and the internal advisory service providers referred to above have formal specialized
Legal and fiscal advisory services are also ensured, nationally and internationally, by external professionals, selected amongst
2. GROUP COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL
STATEMENTS
The Group companies included in the consolidated financial statements, their consolidation methods, registered offices and
st
percentage of share capital held by the Group on 31 December 2015 and 2014 are the following:
COMPANIES CONSOLIDATED USING THE FULL CONSOLIDATION METHOD
COMPANY
Martifer SGPS, S.A.
Martifer Gestiune Si Servicii, S.R.L.
Martifer Metallic Constructions
SGPS, S.A.
Martifer - Construções
Metalomecânicas, S.A.
Martifer Mota-Engil Coffey
Construction Joint Venture Limited
Martifer Alumínios Angola, S.A.
Martifer Aluminium Limited
Martifer Aluminium UK Limited
Martifer Aluminium SAS
Martifer – Construcciones Metálicas
España, S.A.
Martifer – Construções Metálicas
Angola, S.A.
Martifer Construction Limited
Martifer Polska Sp. Zo.o.
Martifer Constructions, SAS
Martifer Inovação e Gestão, S.A.
Martifer Romania SRL
Park Logistyczny Biskupice
Martifer Konstrukcje Sp. Z o.o.
Martifer Slovakia S.R.O.
Sociedade de Madeiras do Vouga, S.A.
Martifer - Gestão de Investimentos, S.A.
Nagatel Viseu, Promoção
Imobiliária, S.A.
Martifer Retail & Warehousing
Angola, S.A.
Martifer Aluminium Pty, Ltd
Martifer - Alumínios, S.A.
Martifer Alumínios Ltda.
Martifer UK Limited
MT Construction Maroc, S.A.R.L.
Martifer - Construções Metálicas, Ltda.
96
HEAD OFFICE
Oliveira de Frades
Bucharest
COUNTRY
Portugal
Romania
DESIGNATION
Martifer SGPS
Martifer Inovação Roménia4)
Oliveira de Frades
Portugal
Oliveira de Frades
Portugal
Martifer Construções
1)
SHARE CAPITAL HELD PERCENTAGE
FY 2014
DIRECTLY
Holding
-
INDIRECTLY
TOTAL
TOTAL
-
-
100.00%
75.00%
-
75.00%
75.00%
-
75.00%
75.00%
79.18%
Dublin
Ireland
MMECC
-
45.00%
45.00%
47.51%
Luanda
Dublin
London
Rungis
Angola
Ireland
United Kingdom
France
Martifer Alumínios Angola 5)
Martifer Aluminium Irlanda 5)
Martifer Aluminium Reino Unido 5)
Martifer Aluminium França 5)
-
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
Madrid
Spain
Martifer Espanha
-
75.00%
75.00%
75.00%
Luanda
Angola
Martifer Angola
-
59.06%
59.06%
59.06%
Dublin
Gliwice
Rungis
Oliveira de Frades
Bucharest
Gliwice
Gliwice
Bratislava
Albergaria-a-Velha
Oliveira de Frades
Ireland
Poland
France
Portugal
Romania
Poland
Poland
Slovakia
Portugal
Portugal
Martifer Irlanda
Martifer Polska
Martifer França
Martifer Inovação
Martifer Romania4)
Biskupice
Martifer Konstrukcje
Martifer Slovakia
Madeiras do Vouga
MGI
2%
-
75.00%
75.00%
75.00%
75.00%
73.50%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.50%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
100.00%
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
Oliveira de Frades
Portugal
Nagatel Viseu
-
75.00%
75.00%
75.00%
Luanda
Angola
Martifer Retail Angola
-
75.00%
75.00%
75.00%
Sydney
Oliveira de Frades
São Paulo
London
Tangier
Fortaleza
Australia
Portugal
Brazil
United Kingdom
Morocco
Brazil
Sassall
Martifer Alumínios 5)
Martifer Alumínios Brasil
Martifer UK
Martifer Marrocos
Martifer Brasil
-
75.00%
75.00%
75.00%
-
75.00%
75.00%
75.00%
-
75.00%
75.00%
74.99%
75.00%
75.00%
74.85%
12
COMPANY
HEAD OFFICE
COUNTRY
DESIGNATION
Saudi Martifer Constructions LLC
Martifer Beteiligungsverwaltungs GmbH
M City Gliwice Sp. Zo.o
Martifer Energy Systems II, SGPS, S.A.
Martifer Energia S.R.L.
Martifer Energia LLC
Martifer Wind Energy Systems LLC
Martifer Energy Systems PTY
Navalria – Docas, Construções e
Reparações Navais, S.A.
Gebox, S.A.
West Sea - Estaleiros Navais, Lda.
Martifer Global SGPS, S.A.
Martifer Construcciones Peru, S.A.
Martifer Amal, S.A.
Global Holding Limited
Global Engineering & Construction
Limited
Riyadh
Vienna
Gliwice
Oliveira de Frades
Bucharest
Kiev
San Angelo TX
Cape Town
Saudi Arabia
Austria
Poland
Portugal
Romania
Ukraine
USA
South Africa
Martifer Arábia Saudita
Martifer GmbH
M City Gliwice
Martifer Energy Systems II
Martifer Energia Roménia
Martifer Energia Ucrânia
Martifer Wind USA
Martifer Energia África do Sul
Aveiro
Portugal
Ílhavo
Oliveira de Frades
Oliveira de Frades
Lima
Oliveira de Frades
Zebbug
Portugal
Portugal
Portugal
Peru
Portugal
Malta
Zebbug
Martifer Solar SGPS, S.A.
Martifer Solar, S.A.
Martifer Solar Sistemas Solares, S.A.
Solar Parks Construccion Parques
Solares ETVE, S.A.
Parque Solar Seseña III, S.L.
MTS Solar Sistemas Solares, S.A.
Martifer Solar Chile Holding, Lda
Martifer Solar Chile Operaciones
Limitada
Mencey Solar SpA
Dehesa Solar SpA
Martifer Solar Servicios México
Martifer Solar S.R.L.
MTS1 S.R.L.
MTS2 S.R.L.
MTS3 S.R.L.
Martifer Solar RO S.R.L.
Martifer Solar Inc.
MT Silverado Fund I LLC
Martifer Solar Finance LLC
Martifer Solar Hellas, A.T.E.
Martifer Solar Angola
Martifer Solar N.V.
Martifer Solar UK Limited
MTS Exbury Solar Limited
MTS Manton Manor Solar Limited
MTS Stud Farm Solar Limited
MTS Penderi Solar Limited
Martifer Solar S.A.S.
Martifer Solar CZ
Home Energy France SAS
PVGlass S.r.l
MPrime Solar Solutions, S.A.
MPrime GMBH
Sol Cativante, Lda.
Martifer Solar Investments, B.V.
MTS6 S.R.L.
Martifer Solar SK s.r.o.
Ginosa Solar Farm, S.R.L.
Solar Spritehood S.R.L
MTS7, S.R.L.
Canopy - Naos
Steadfast Fairview Solar, Ltd
Martifer Solar UA, LLC
Inspira Martifer Solar Limited
Societé Developpement Local SA
Martimak Solar
Martiper Solar
Martifer Solar Lasout
Martifer Solar Parrou
Martifer Solar Parroc
FY 2014
DIRECTLY
INDIRECTLY
TOTAL
TOTAL
100.00%
-
75.00%
75.00%
75.00%
75.00%
75.00%
75.00%
63.75%
75.00%
100.00%
75.00%
75.00%
75.00%
75.00%
75.00%
63.75%
75.00%
100.00%
75.00%
100.00%
100.00%
100.00%
100.00%
85.00%
Navalria
-
75.00%
75.00%
100.00%
Gebox
West Sea
Martifer Global
Martifer Peru
Martifer Amal
-
75.00%
75.00%
75.00%
75.00%
45.00%
75.00%
75.00%
75.00%
75.00%
75.00%
45.00%
75.00%
100.00%
100.00%
100.00%
100.00%
30.00%
100.00%
Malta
Global Engineering
-
75.00%
75.00%
100.00%
Oliveira de Frades
Oliveira de Frades
Madrid
Portugual
Portugal
Spain
Martifer Solar SGPS
Martifer Solar 2)
Martifer Solar Sistemas Solares2)
100.00%
-
55.00%
55.00%
100.00%
55.00%
55.00%
100.00%
55.00%
55.00%
Madrid
Spain
Solar Parks2)
-
55.00%
55.00%
55.00%
Madrid
Mexico City
Santiago
Spain
Spain
Chile
Seseña III2)
Martifer Solar México2)
Martifer Solar Chile2) 3)
-
55.00%
55.00%
55.00%
55.00%
55.00%
54.45%
55.00%
Santiago
Chile
Solar Chile Operaciones2) 3)
-
-
-
55.00%
Santiago
Santiago
Mexico City
Milan
Siracusa
Siracusa
Siracusa
Bucharest
S. Francisco CA
S. Francisco CA
S. Francisco CA
Athens
Luanda
Deerlijk
London
London
London
London
London
Lyon
Prague
Lyon
Milan
Oliveira de Frades
Munich
Sever do Vouga
Amesterdam
Siracusa
Dolny Kubin
Rome
Rome
Rome
Paris
Andover
Kiev
Mumbai
Dakar
Besiktas
Besiktas
Lyon
Lyon
Lyon
Chile
Chile
Mexico
Italy
Italy
Italy
Italy
Romania
USA
USA
USA
Greece
Angola
Belgium
United Kingdom
United Kingdom
United Kingdom
United Kingdom
United Kingdom
France
Czech Republic
France
Italy
Portugal
Germany
Portugal
Netherlands
Italy
Slovakia
Italy
Italy
Italy
France
United Kingdom
Ukraine
India
Senegal
Turkey
Turkey
France
France
France
Mencey Solar2)
Dehesa Solar 2)
Martifer Solar Servicios México2)
Martifer Solar Itália2)
MTS12)
MTS22)
MTS32)
Martifer Solar Roménia2)
Martifer Inc. 2)
Silverado 1) 2)
Martifer Solar Finance2)
PVI 1) 2)
Martifer Solar Angola 1) 2)
Martifer Solar Bélgica2)
Martifer Solar UK2)
MTS Exbury Solar Limited2)
MTS Manton Manor Solar Limited2)
MTS Stud Farm Solar Limited2)
MTS Penderi Solar Limited2)
Martifer Solar França2)
Martifer Solar República Checa2)
Home Energy França 2)
PVGlass Itália2)
Mprime2)
MPrime GMBH2)
Sol Cativante 2)
Martifer Solar Holanda2)
MTS62)
Martifer Solar Eslováquia2)
Ginosa Solar Farm2)
Solar Spritehood2)
MTS72)
Canopy Naos2)
Steadfast Fairview Solar2)
Martifer Solar Ucrânia2)
Inspira Martifer Solar 1) 2)
Martifer Solar Senegal 1) 2)
Martimak1) 2)
Martiper1) 2)
MTSFR-Lasout2)
MTSFR-Parrou 2)
MTSFR-Parroc 2)
-
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
31.42%
39.13%
41.25%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
28.05%
28.05%
44.00%
44.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
31.42%
39.13%
41.25%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
28.05%
28.05%
44.00%
44.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
31.42%
55.00%
39.13%
41.25%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
55.00%
28.05%
28.05%
44.00%
44.00%
-
97
12
COMPANY
HEAD OFFICE
COUNTRY
DESIGNATION
Martifer Solar Singapura PTE. LTD.
Martifer Solar Japan KK
Solariant Portfolio GK One
EVIVA SOLAR 1 LTD
EVIVA SOLAR 2 LTD
MTS Tonge Solar Limited
Khepri Solar B.V._NL
Martifer Solar MZ, S.A.
Greencoverage Unipessoal, Lda.
Martifer Solar, Ltda
Visiontera Unipessoal, Lda
Singapore
Tokio
Tokio
Athens
Athens
London
Amsterdam
Maputo
Oliveira de Frades
Pindamonhangaba
Oliveira de Frades
Martifer Solar Middle East
Dubai
Belive in Bright Unipessoal, LDA.
Martifer Solar S.A (Sucursal Jordânia)
Oliveira de Frades
Amman
Singapore
Japan
Japan
Greece
Greece
United Kingdom
Netherlands
Mozambique
Portugal
Brazil
Portugal
United Arab
Emirates
Portugal
Jordan
Martifer Renewables SGPS, S.A.
Martifer Renewables, S.A.
Martifer Renewables ETVE, S.A.U.
Eurocab FV 1 S.L.
Eurocab FV 2 S.L.
Eurocab FV 3 S.L.
Eurocab FV 4 S.L.
Eurocab FV 5 S.L.
Eurocab FV 6 S.L.
Eurocab FV 7 S.L.
Eurocab FV 8 S.L.
Eurocab FV 9 S.L.
Eurocab FV 10 S.L.
Eurocab FV 11 S.L.
Eurocab FV 12 S.L.
Eurocab FV 13 S.L.
Eurocab FV 14 S.L.
Eurocab FV 15 S.L.
Eurocab FV 16 S.L.
Eurocab FV 17 S.L.
Eurocab FV 18 S.L.
Eurocab FV 19 S.L.
Eviva Energy S.R.L.
Eviva Nalbant S.R.L.
Eviva Agighiol S.R.L.
Eviva Casimcea S.R.L.
Premium Management Consulting,
S.R.L.
MW Topolog, S.R.L.
Martifer Renewables Pty, Ltd.
Eviva Beteiligungsverwaltungs GmbH
Eviva Hidro S.R.L.
Martifer Deutschland GmbH
Wind Farm Odrzechowa Sp. Zo.o
Wind Farm Bukowsko Sp. Zo.o
Wind Farm Markowa Sp. Zo.o
Wind Farm Lada Sp. Zo.o
Wind Farm Jawornik Sp. Zo.o
Wind Farm Piersno Sp. Zo.o
Wind Farm Oborniki Sp. Zo.o
Martifer Renewables Brazil B.V.
Martifer Renewables Investments
ETVE, S.A.
Martifer Renewables Italy BV
Martifer Renewables Brasil
Participações LTDA
Martifer Renováveis - Geração
de Energia e Participações S.A.
Eólica Cajueiro da Praia, Ltda.
SBER – Sociedade Brasileira
de Energias Renováveis, Ltda.
Melosa – Geração de Energia
e Participações, Ltda.
MSPAR Energia e Participações, SA
Floresta I, Geração de Energia S.A.
Oliveira de Frades
Oliveira de Frades
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Madrid
Bucharest
Bucharest
Bucharest
Bucharest
Portugal
Portugal
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Spain
Romania
Romania
Romania
Romania
Martifer Renewables SGPS
Martifer Renewables SA
Martifer Renovables
Eurocab 1
Eurocab 2
Eurocab 3
Eurocab 4
Eurocab 5
Eurocab 6
Eurocab 7
Eurocab 8
Eurocab 9
Eurocab 10
Eurocab 11
Eurocab 12
Eurocab 13
Eurocab 14
Eurocab 15
Eurocab 16
Eurocab 17
Eurocab 18
Eurocab 19
Eviva Roménia
Eviva Nalbant
Eviva Agighiol
Eviva Casimcea
Bucharest
Romania
Bucharest
Gliwice
Sidney
Vienna
Bucharest
Berlin
Gliwice
Gliwice
Gliwice
Gliwice
Gliwice
Gliwice
Gliwice
Amsterdam
Romania
Poland
Australia
Austria
Romania
Germany
Poland
Poland
Poland
Poland
Poland
Poland
Poland
Netherlands
Madrid
Spain
Amsterdam
Netherlands
Fortaleza
98
FY 2014
DIRECTLY
INDIRECTLY
TOTAL
TOTAL
Martifer Solar Singapura2)
Martifer Solar Japan2)
Solariant Portfolio GK One2)
Eviva Solar 12)
Eviva Solar 22)
MTS Tonge2)
Khepri Solar2)
Martifer Solar Moçambique 1) 2)
Greencoverage2)
Martifer Solar Brasil2)
Visiontera2)
-
55.00%
55.00%
55.00%
54.90%
54.90%
55.00%
28.05%
55.00%
54.45%
55.00%
55.00%
55.00%
55.00%
54.90%
54.90%
55.00%
28.05%
55.00%
54.45%
55.00%
55.00%
55.00%
55.00%
54.90%
54.90%
55.00%
28.05%
55.00%
54.45%
55.00%
Martifer Solar Middle East2)
-
55.00%
55.00%
55.00%
Belive in Bright2)
Martifer Solar Jordânia 2)
-
55.00%
55.00%
55.00%
55.00%
55.00%
-
100.00%
-
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
99.00%
99.00%
Premium Management
-
85.00%
85.00%
85.00%
MW Topolog
Eviva Polónia
Eviva Austrália
Eviva GmbH
Eviva Hidro
Martifer Deutschland
Wind Odrzechowa
Wind Farm Bukowsko
Wind Farm Markowa
Wind Farm Lada
Wind Farm Jawornik
Wind Farm Piersno
Wind Farm Oborniki
Renewables Holanda
1.00%
-
100.00%
100.00%
100.00%
99.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
99.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
Eurocab 21
-
100.00%
100.00%
100.00%
Renewables Italy Holanda
-
100.00%
100.00%
100.00%
Brazil
Martifer Renewables Brasil
-
100.00%
100.00%
100.00%
Fortaleza
Brazil
Ventania
-
55.00%
55.00%
55.00%
Fortaleza
Brazil
Cajueiro
-
55.00%
55.00%
55.00%
Fortaleza
Brazil
SBER 1)
-
46.88%
46.88%
41.25%
Fortaleza
Brazil
Melosa
-
-
-
55.00%
Barueri
Areia Branca
Brazil
Brazil
MSPAR
Floresta I
-
100.00%
99.00%
100.00%
99.00%
100.00%
-
12
COMPANY
Floresta II, Geração de Energia S.A.
Floresta III, Geração de Energia S.A.
Floresta IV, Geração de Energia S.A.
Martifer Renewables O&M Sp. z o.o.
HEAD OFFICE
COUNTRY
DESIGNATION
Areia Branca
Areia Branca
Areia Branca
Gliwice
Brazil
Brazil
Brazil
Poland
Floresta II
Floresta III
Floresta IV
Martifer Renewables O&M
FY 2014
DIRECTLY
INDIRECTLY
TOTAL
TOTAL
-
99.00%
99.00%
99.00%
52.00%
99.00%
99.00%
99.00%
52.00%
52.00%
1) The consolidation of these companies using the full consolidation method is a consequence of the Group having stepped shareholdings, exercising control at each level.
st
2) This company, on 31 December 2014 and 2015 was classified as a non-current asset held for sale (Note 28).
3) Martifer Solar Chile Operaciones Limitada and Martifer Solar Chile Holding, Lda. merged on December 2015.
4) Martifer Gestiune Si Servicii, S.R.L merged with Martifer Constructii, S.R.L., changing its name to Martifer Romania, S.R.L.
5) Martifer Alumínios, S.A. merged with Martifer Construções Metalomecânicas, S.A.
COMPANIES CONSOLIDATED USING THE EQUITY METHOD
The companies consolidated using the equity method; their registered offices and the percentage of share capital held by the Group
are as follows:
COMPANY
Metallic Constructions:
Associate companies:
Liszki Green Park, Sp. Zo.o
Martifer Amal, S.A.
Martifer Amal, S.A.
Martimetal Spa
Joint control companies:
Promoquatro – Investimentos
Imobiliários, Lda.
M City Bialystok Sp. Zo.o
M City Radom Sp. Zo.o
M. City Szczecin Sp. Z o.o.
Solar
Parque Solar Seseña I, S.L.
Canaverosa Renovables, SL
Empresa de Energia Renovable
Maria del Sol Norte S.A.
MSN Solar Uno SpA
MSN Solar Dos SpA
MSN Solar Tres SpA
MSN Solar Cuatro SpA
MSN Solar Cinco SpA
Martifer Solar Canadá, Ltd.
Renewables
Eviva Gizalki Sp. Zo.o
Joint control companies:
Ventinveste, S.A.
Âncora Wind – Energia Eólica, S.A
Parque Eólico do Douro Sul, S.A.
Parque Eólico de Vale do
Chão, S.A.
Parque Eólico de Torrinheiras, S.A.
Parque Eólico do Pinhal do Oeste, S.A.
Parque Eólico de Vale Grande. S.A.
Parque Eólico do Cabeço Norte, S.A.
Parque Eólico da Serra do Oeste, S.A.
Parque Eólico do Planalto, S.A.
Eviva Dunowo, Sp. Z o.o.
SPEE 3 – Parque Eólico do Baião, S.A.
SPEE 2 – Parque Eólico de Vila
Franca de Xira, S.A.
Parque Eólico da Penha
da Gardunha, Lda.
Other
Prio Energy SGPS. S.A.
Prio Biocombustíveis. S.A.
Prio Energy. S.A.
Mondefin
Prio Parque de Tanques de Aveiro, S.A.
FY 2014
DIRECTLY
INDIRECTLY
TOTAL
TOTAL
Liszki Green Park
Martifer Amal
Martifer Amal
Martimetal
-
33,75%
26,25%
36,75%
33,75%
26,25%
36,75%
45,00%
35,00%
30,00%
49,00%
Portugal
Promoquatro
-
37,50%
37,50%
37,50%
Gliwice
Gliwice
Gliwice
Poland
Poland
Poland
M City Bialystok
M City Radom
M City Szczecin
-
37,50%
37,50%
37,50%
37,50%
37,50%
37,50%
37,50%
37,50%
37,50%
Madrid
Madrid
Spain
Spain
Seseña I 1)
Canaverosa 1)
-
20,61%
20,61%
20,61%
26,94%
Santiago
Chile
Maria del Sol 1)
-
26,95%
26,95%
26,95%
Santiago
Santiago
Santiago
Santiago
Santiago
Toronto
Chile
Chile
Chile
Chile
Chile
Canada
MSN Solar Uno 1)
MSN Solar Dos 1)
MSN Solar Tres 1)
MSN Solar Cuatro 1)
MSN Solar Cinco 2)
2)
Martifer Solar Canadá
-
26,95%
26,95%
26,95%
26,95%
26,95%
27,50%
26,95%
26,95%
26,95%
26,95%
26,95%
27,50%
26,95%
26,95%
26,95%
26,95%
26,95%
27,50%
Miastko
Poland
Eviva Gizalki
-
-
-
100,00%
Lisbon
Lisbon
Lisbon
Portugal
Portugal
Portugal
Ventinveste SA
Âncora
PE Douro Sul
6%
-
42,5%
24,25%
24,25%
48,50%
24,25%
24,25%
48,50%
24,25%
24,25%
Lisbon
Portugal
PE Vale do Chão
-
24,25%
24,25%
24,25%
Lisbon
Lisbon
Lisbon
Lisbon
Lisbon
Lisbon
Gliwice
Lisbon
Portugal
Portugal
Portugal
Portugal
Portugal
Portugal
Poland
Portugal
PE Torrinheiras
PE Pinhal do Oeste
PE Vale Grande
PE Cabeço Norte
PE Serra do Oeste
PE Planalto
Eviva Dunowo
SPEE 3
-
48,50%
48,50%
48,50%
48,50%
48,50%
48,50%
50,00%
48,50%
48,50%
48,50%
48,50%
48,50%
48,50%
50,00%
48,50%
48,50%
48,50%
48,50%
48,50%
48,50%
50,00%
50,00%
Oliveira de Frades
Portugal
SPEE 2
-
50,00%
50,00%
50,00%
Oliveira de Frades
Portugal
PE Penha da Gardunha
-
50,00%
50,00%
50,00%
Oliveira de Frades
Oliveira de Frades
Oliveira de Frades
Coimbra
Oliveira de Frades
Portugal
Portugal
Portugal
Portugal
Portugal
Prio Energy SGPS 3)
Prio Biocombustíveis 3)
Prio Energy 3)
Mondefin 3)
Prio Tanques 3)
-
-
-
5,00%
5,00%
5,00%
5,00%
5,00%
HEAD OFFICE
COUNTRY
DESIGNATION
Gliwice
Nacala
Oliveira de Frades
Algiers
Poland
Mozambique
Portugal
Algeria
Oliveira de Frades
2)
99
12
COMPANY
Prio.E-Electric, S.A.
PRIO.E - Mobility Solutions, Lda
Prio. E – SGPS, S.A.
Share Motivation, Lda.
IMO 505, Lda
Prio Gas Lisboa, SA
1)
2)
3)
HEAD OFFICE
COUNTRY
DESIGNATION
Oliveira de Frades
Oliveira de Frades
Oliveira de Frades
Oliveira de Frades
Coimbra
Aveiro
Portugal
Portugal
Portugal
Portugal
Portugal
Portugal
Prio.E-Electric
3)
Park Charge
3)
Prio E SGPS
3)
Share Motivation
3)
IMO 505
Prio Gas 3)
3)
FY 2014
DIRECTLY
INDIRECTLY
TOTAL
TOTAL
-
-
-
5,00%
5,00%
5,00%
5,00%
5,00%
2,50%
st
This company on 31 December 2015 was classified as a non-current asset held for sale (Note 28).
The consolidation of this company using the equity method is justified because the Group only has significant influence over it
In 2015, the share on Prio Group was transferred to other financial investments. In 2014 the consolidation of the Prio Companies was performed using the equity
method and this was justified because the Holding had a significant influence over them (Note 21).
st
During the periods ended on 31 December 2015 and 2014, the changes occurred in the consolidation perimeter were as follows:
COMPANIES INCORPORATED
FY 2015
HEAD OFFICE
COUNTRY
Floresta I, Geração de Energia S.A.
Areia Branca
Brazil
Floresta II, Geração de Energia S.A.
Areia Branca
Brazil
Floresta III, Geração de Energia S.A.
Areia Branca
Brazil
Floresta IV, Geração de Energia S.A.
Areia Branca
Brazil
Martifer Solar Lasout
Lyon
France
Martifer Solar Parrou
Lyon
France
Martifer Solar Parroc
Lyon
France
Martifer Solar S.A (Sucursal Jordânia)
Amman
Jordan
Khepri Solar B.V._NL
Amsterdam
Netherlands
Mencey Solar SpA
Santiago
Chile
Dehesa Solar SpA
Santiago
Chile
HEAD OFFICE
COUNTRY
Algiers
Algeria
MTS Exbury Solar Limited
London
United Kingdom
MTS Manton Manor Solar Limited
London
United Kingdom
MTS Stud Farm Solar Limited
London
United Kingdom
MTS Penderi Solar Limited
London
United Kingdom
MTS Hill Farm Solar Limited
London
United Kingdom
Lisbon
Portugal
Aveiro
Portugal
HEAD OFFICE
COUNTRY
Lisbon
Portugal
Renewables
Subsidiary companies:
Solar
FY 2014
Martimetal Spa
Solar
Renewables
Âncora Wind – Energia Eólica, S.A
Other
Prio Gas Lisboa, SA
COMPANIES ACQUIRED
FY 2015
Other
Moléculaviva-Unipessoal, Lda
100  ANNUAL REPORT 2015 
12
FY 2014
HEAD OFFICE
COUNTRY
Tokyo
Japan
Coimbra
Portugal
HEAD OFFICE
COUNTRY
Martifer - Construções Metálicas, Ltda.
Fortaleza
Brazil
Martifer Alumínios Ltda
São Paulo
Brazil
Canopy Naos
Paris
France
Martifer Solar Finance LLC
San Francisco, CA
USA
Cañaverosa Renovables
Madrid
Spain
MTS7, S.R.L.
Rome
Italy
MTS3 S.R.L.
Siracusa
Italy
Martifer Solar CZ
Prague
Czech Republic
Parque Solar Seseña III, S.L.
Madrid
Spain
MPrime GMBH
Munich
Germany
MTS Tonge Solar Limited
London
United Kingdom
Melosa- Geração de Energia e Participações, Ltda.
Fortaleza
Brazil
Eviva Dunowo, Sp. Z o.o.
Gliwice
Poland
Eviva Gizalki Sp. Zo.o
Miastko
Poland
MW Topolog, S.R.L.
Bucharest
Romania
HEAD OFFICE
COUTRY
MTS Spittleborough Solar Limited
London
United Kingdom
Montidílico Unipessoal, LDA.
Oliveira de Frades
Portugal
Inovsun, Lda.
Oliveira de Frades
Portugal
MTS Francis Court Solar Limited
London
United Kingdom
MTS Hill Farm Solar Limited
London
United Kingdom
MTS Rydon Solar Limited
London
United Kingdom
Steadfast Molland Solar, Ltd
Andover
United Kingdom
Martifer Solar USA, Inc.
Santa Monica, CA
USA
Martifer Aurora Solar, LLC
Santa Monica, CA
USA
Martifer Solar Sistemas Solares Equador S.A.
Sangolquí
Ecuador
Vesto EAD
Varna
Bulgaria
DVP1 Limited
Varna
Bulgaria
DVP2 Limited
Varna
Bulgaria
Rosa dos Ventos - Geração e Comercialização de Energia, S.A
Fortaleza
Brazil
Ventinveste Indústria SGPS, S.A.
Oliveira de Frades
Portugal
Eólica Coqueirais, Ltda.
Fortaleza
Brazil
Solar
Solariant Portfolio GK One
Other
IMO 505, Lda
COMPANIES SOLD / LIQUIDATED
FY 2015
Solar
Renewables
FY 2014
Solar
Renewables
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  101
12
FY 2014
HEAD OFFICE
COUTRY
Eólica Paraipaba, Ltda .
Fortaleza
Brazil
Eólica Chapadão, Ltda.
Fortaleza
Brazil
Eólica Macaúbas, Ltda.
Fortaleza
Brazil
Eólica Sobradinho, Ltda.
Fortaleza
Brazil
Nutre SGPS, S.A.
Oliveira de Frades
Portugal
Nutre, S.A.
Oliveira de Frades
Portugal
Nutre - Industrias Alimentares, S.A.
Oliveira de Frades
Portugal
Nutre MZ. S.A.
Maputo
Mozambique
Nutre Farming, S.R.L.
Bucharest
Romania
Prio Agromart S.R.L.
Bucharest
Romania
Prio Balta S.R.L.
Bucharest
Romania
Prio Facaieni S.R.L.
Bucharest
Romania
Prio Ialomita S.R.L.
Bucharest
Romania
Prio Rapita S.R.L.
Bucharest
Romania
Nutre Farming West Part S.R.L.
Bucharest
Romania
Prio Terra Agricola S.R.L.
Bucharest
Romania
Prio Turism Rural S.R.L
Bucharest
Romania
Agromec Balaciu
Bucharest
Romania
Miharox S.R.L.
Bucharest
Romania
Zimbrul. S.A.
Bucharest
Romania
Agrozootehnica. S.A.
Bucharest
Romania
Prio Agrotrans S.R.L.
Bucharest
Romania
Nutre Brasil LTDA
S. Luís do Maranhão
Brazil
Prio Extractie S.R.L.
Bucharest
Romania
Prio Agro Industries. Sp. Z o.o.
Gliwice
Poland
Prio Biocombustibil S.R.L.
Bucharest
Romania
Prio Meat S.R.L
Bucharest
Romania
Prio Foods – AJFS Construções, ACE
Lisboa
Portugal
Nutre Farming B.V.
Amsterdam
Netherlands
Bunge Prio Cooperativa U.A.
Amsterdam
Netherlands
Bunge Roménia S.R.L.
Buzau
Romania
Centralrest, Lda
Ilhavo
Portugal
Prio Agriculture, B.V.
Delft
Netherlands
Porthold Project Development BV
Amsterdam
Netherlands
Fertilis Agro-Indústrias, Lda
Luanda
Angola
Other
CHANGES IN THE CONSOLIDATION METHOD:
In 2015:
Martifer Amal, S.A. (Portugal) – from equity to full consolidation method due to the increase in participation by Martifer Global to 60 %,
with the Group owning only 45 % (due to the sale of Martifer SGPS, S.A.’s share in Martifer Global SGPS, S.A. to Martifer Metallic
Constructions SGPS, S.A., but with control over it).
Cañaverosa Renovables, SL – from equity to full consolidation method due to the increase in participation by the Group to 54.98 %.
This participation was meanwhile sold during the second quarter of 2015.
Prio Group – in 2015 it stopped being consolidated through the equity method, since the Group does not have any significant influence,
due to the residual value of the Group’s share and with the share reduction prospect confirmed.
In 2014:
MTS 3 – from equity to full consolidation method due to the increase in participation by Martifer Solar Itália from 49 % to 100 %.
Martifer Solar Canadá – from full consolidation to equity method due to the reduction of participation by Martifer Solar Investments
B.V. from 100 % to 50 %.
12
Eviva Gizalki - from full consolidation to equity method due to loss of control over the company, namely for not managing its
financial and operational policies. In the fourth quarter of 2015, this company was sold.
OTHER CHANGES IN THE CONSOLIDATION PERIMETER
In 2015:
Eviva Nalbant, srl – increase in the shareholding held from 99.99997 % to 100 %.
Eviva Casimcea, srl – increase in the shareholding held from 99 % to 100 %.
Eviva Agighiol, srl – increase in the shareholding held from 99 % to 100 %.
SBER- Sociedade Brasileira de Energias Renováveis- increase in the shareholding held from 41.25 % to 46.88 %.
Martifer - Construções Metalomecânicas, S.A. – decrease in the shareholding held from 79.18 % para 75 % due to the Group’s
corporate reorganization
Martifer Inovação e Gestão, S.A. - decrease in the shareholding held from 100 % to 75 % due to the Group’s corporate reorganization
Martifer Mota-Engil Coffey Construction Joint Venture Limited - decrease in the shareholding held from 47.51 % to 45 % due to the
Group’s corporate reorganization
Martifer Energy Systems II, SGPS, S.A. - decrease in the shareholding held from 100 % to 75 % due to the Group’s corporate
reorganization.
Martifer Energia S.R.L. - decrease in the shareholding held from 100 % to 75 % due to the Group’s corporate reorganization.
Martifer Energia LLC - decrease in the shareholding held from 100 % to 75 % due to the Group’s corporate reorganization.
Martifer Wind Energy Systems LLC - decrease in the shareholding held from 100 % to 75% due to the Group’s corporate
reorganization.
Martifer Energy Systems PTY - decrease in the shareholding held from 85 % to 63.75 % due to the Group’s corporate reorganization
Navalria – Docas, Construções e Reparações Navais, S.A. - decrease in the shareholding held from 100 % to 75 % due to the Group’s
corporate reorganization.
Gebox, S.A. - decrease in the shareholding held from 100 % to 75 % due to the Group’s corporate reorganization.
West Sea - Estaleiros Navais, Lda. - decrease in the shareholding held from 100 % to 75 % due to the Group’s corporate
reorganization.
Martifer Global SGPS, S.A. - decrease in the shareholding held from 100 % to 75 % due to the Group’s corporate reorganization.
Martifer Construcciones Peru, S.A. - decrease in the shareholding held from 100 % to 75 % due to the Group’s corporate
reorganization.
Global Holding Limited - decrease in the shareholding held from 100 % to 75 % due to the Group’s corporate reorganization.
Global Engineering & Construction Limited - decrease in the shareholding held from 100 % to 75 % due to the Group’s corporate
reorganization
Martifer Amal, S.A. (Moçambique) - decrease in the shareholding held from 35 % to 26.25 % due to the Group’s corporate
reorganization.
In the third quarter, the Group carried out a corporate reorganization, having Martifer Metallic Constructions SGPS, S.A. acquired
several shareholdings from Martifer SGPS, S.A., included in the Metallic Constructions sector, as reported above.
Martifer Gestiune Si Servicii, S.R.L. merged with Martifer Constructii S.R.L., creating Martifer Romania S.R.L., which is participated 2 %
directly and a 73.5 % indirectly by the Holding.
Martifer Solar Chile Operaciones Limitada merged with Martifer Solar Chile Holding, Lda, and the later was maintained.
MTS Solar Sistemas Solares, S.A. – increase in the indirect participation from 54.45 % to 55 %.
12
Martifer Alumínios, S.A. merged with Martifer Construções Metalomecânicas, S.A..
In 2014:
MS Par Energia e Participações – transfer of shareholding from Martifer Renováveis, SA to Martifer Renewables Brasil
Participações, Ltda.
Prio Energy SGPS – decrease in the share held by Martifer SGPS, SA, from 10 % to 5 %.
Martifer Metallic Constructions SGPS, S.A – decrease in the share held by Martifer SGPS, SA, from 100% to 75%.
Martifer Aluminium PTY – transfer of shareholding from Martifer Alumínios, SA to Martifer Metallic Constructions SGPS, SA.
Ventinveste, S.A – increase in the share held directly and indirectly by Martifer SGPS, SA from 46% to 48,5%
FTP Power LLC (previously FTP Solar LLC) – discontinuation of the equity method due to the loss of significant influence.
Martifer Solar USA – deconsolidation due to the loss of control verified with the signature of the “settlement, plan, support and
release agreement”.
Martifer Aurora Solar LLC – deconsolidation due to the loss of control verified with the signature of the “settlement, plan, support
and release agreement”.
3. INFORMATION BY BUSINESS SEGMENTS
The Group bases its disclosure of information on the primary segments of its internal organisation for management purposes.
The Group is organised in two business areas: ‘Metallic Constructions’ and ‘Renewables’ that are coordinated and supported by
Martifer SGPS.
The Metallic Constructions business area includes all the construction activities involving metal mechanical constructions,
aluminium and glass façades, infrastructures for oil & gas and naval industry. The Renewables segment includes the promotion and
development of renewable energy projects, with special emphasis on the wind sector.
The amounts presented in ‘Other’ are related to the services rendered by Martifer SGPS, S.A., Martifer Solar SGPS, S.A. and by
Martifer Inovação e Gestão S.A. (the later up until August 2015, since in September it was transferred to the Metallic Constructions
perimeter).
In September 2014, the Group started to classify the solar business unit (composed by Martifer Solar, SA and its subsidiaries) as a
non current asset held for sale. Since the requirements of IFRS 5 were fulfilled, the contribution to Martifer’s consolidated results,
coming from this segment, is presented in an autonomous line in the Consolidated P&L. The breakdown of these contributions is in
the Notes to Consolidated Financial Statements (Note 28).
The accounting policies used in the preparation of the information by each business segment are the same as the ones used in the
preparation of the attached financial statements (Note 1).
st
On 31 December 2015 and 2014, the breakdown of sales and services rendered by primary segments is as follows:
SALES TO EXTERNAL CUSTOMERS
Renewables
Other
Intersegment eliminations
Own work capitalized (Note 5)
INTERSEGMENT SALES
TOTAL
FY 2015
FY 2014
FY 2015
FY 2014
FY 2015
FY 2014
205,403,265
179,331,294
29,701,146
33,946,559
235,104,411
213,277,853
13,066,360
9,711,819
822,500
758,734
13,888,860
10,470,553
2,415,723
1,249,161
530,055
4,541,729
2,945,778
5,790,890
220,885,349
190,292,274
31,053,701
39,247,022
251,939,050
229,539,296
(29,496,741)
(35,588,422)
(1,556,960)
(5,042,877)
220,885,349
188,907,997
12
Sales and services rendered to non-group clients by geographical origin and by segment are as follows:
FY 2015
FY 2014
Iberian Peninsula
73,745,258
54,508,612
Renewables
5,109,917
5,254,348
Other
2,415,722
1,108,386
55,421,556
41,453,619
7,879,525
3,210,350
-
126,037
76,236,451
82,179,439
Central Europe
Renewables
Other
Other markets
Renewables
76,918
1,067,206
220,885,349
188,907,997
´
The sales and services rendered reached 221 million euros, which represents a 17 % growth when compared with 2014. In the
‘Metallic Constructions’ segment, they increased 15 % to 205 million euros, with significant growth in the ‘Iberian Peninsula’ and
‘Central Europe geographies and a decrease in ‘Other markets’, due to the impact of Brazil (business sold in September). Excluding
Brazil, the geography ‘Other markets’ would also grow when compared with 2014. In the ‘Renewables’ segment, sales increased 37
% mainly due to the growth of sales in Romania and Poland. The Group is focused in internationalization, focusing in emerging
countries and in markets with profitability above average.
st
On 31 December 2015 and 2014, the earnings before interest, taxes, amortization, provisions and impairment losses (EBITDA),
the earnings before interest and taxes (EBIT) and the net profit by primary segment are as follows:
EBITDA
EBIT
NET PROFIT
FY 2015
FY 2014
FY 2015
FY 2014
FY 2015
FY 2014
9,214,427
(7,284,819)
6,584,892
(51,393,311)
6,381,448
(68,411,237)
Renewables
2,650,403
12,904,338
(4,580,960)
5,192,718
3,397,081
614,180
Other
(475,675)
384,533
(2,522,950)
(1,059,750)
(7,805,461)
(3,733,388)
11,389,156
6,004,052
(519,017)
(47,260,343)
1,973,068
(71,530,445)
n,a,
n,a,
n,a,
n,a,
(800,771)
(65,171,979)
11,389,156
6,004,052
(519,017)
(47,260,343)
1,172,297
(136,702,424)
Non-current operation held for sale
In 2015, the Group’s Consolidated EBITDA reflects a significant increase, when compared with 2014, from 6 million euros to 11.4
million euros, which represents a growth in around 90 %. This increase in EBITDA is strongly influenced by the increase in the
EBITDA of Metallic Constructions, from negative 7.2 million euros to positive 9.2 million euros. In the Renewables segment,
EBITDA reached 2.7 million euros in 2015showing a 79 % decrease when compared with the previous year, mainly justified by the
significant effect of the sale of Rosa dos Ventos in Brazil in 2014. The EBITDA in 2015 results from Martifer Renewables’
throughout the year and from the impairment of a credit in Brazil. Without this impairment, Martifer Renewables’ EBITDA would
reach 6 million euros.
The gains and losses in associate companies, the carrying amount of the investments in associate companies, as well as the
increases and reversals of provisions and impairment losses by primary segment are as follows:
LOSSES IN ASSOCIATE
COMPANIES
Renewables
Other (Note 13)
GAINS IN ASSOCIATE COMPANIES
CARRYING AMOUNT OF THE
FINANCIAL ASSETS RECORDED
UNDER EQUITY METHOD
FY 2015
FY 2014
FY 2015
FY 2014
FY 2015
588,112
467,155
-
-
1,352,192
722,768
73,516
2,587
625,860
449,587
1,798,452
5,564,732
-
1,192,970
-
1,511,016
469,742
625,860
1,642,557
3,150,644
7,798,516
661,628
FY 2014
12
PROVISIONS AND IMPAIRMENT
LOSSES RECORDED IN THE YEAR
REVERSALS OF PROVISIONS
AND IMPAIRMENT LOSSES
RECORDED IN THE YEAR
FY 2015
FY 2014
FY 2015
FY 2014
1,237,867
37,716,031
4,530,161
386,977
Renewables
1,481,720
1,550,224
31,620
248,243
Other
1,770,689
-
-
-
4,490,277
39,266,255
4,561,781
635,219
st
The Group’s net assets and liabilities by operating segments on 31 December 2015 and 2014 are as follows:
ASSETS
LIABILITIES
FY 2015
FY 2014
FY 2015
FY 2014
287,696,541
310,078,424
276,515,809
306,200,108
Solar (*)
146,991,407
143,313,447
142,930,364
137,358,237
Renewables
155,495,991
157,464,362
60,704,009
63,327,919
Holding and Martifer Solar SGPS
Intragroup eliminations
472,517,464
521,568,741
164,916,271
161,701,757
(456,070,303)
(499,695,276)
(50,107,938)
(51,206,314)
606,631,099
632,729,698
594,958,514
617,381,707
(*) Martifer Solar Consolidated. The difference regarding Note 28 arises from inter-area eliminations and consolidation adjustments
The Group’s capital expenditure (acquisition of tangible and intangible assets) and depreciation / amortization, by operating
st
segments up until 31 December 2015 and 2014 were as follows:
CAPITAL EXPENDITURES
AMORTIZATIONS
FY 2015
FY 2014
FY 2015
FY 2014
2,347,221
13,310,159
5,921,829
6,963,558
Renewables
2,008,856
1,681,481
5,521,590
6,228,282
750
18,091
536,258
1,441,519
4,356,827
15,009,731
11,979,677
14,633,359
Other
Assets and capital expenditure by geographical areas were as follows:
ASSETS
CAPITAL EXPENDITURES
FY 2015
FY 2014
FY 2015
FY 2014
Iberian Peninsula
268,851,853
277,102,155
1,881,587
2,419,640
European Union (other)
205,407,930
233,800,945
495,381
3,495,055
132,371,315
121,826,598
1,979,859
9,095,035
606,631,099
632,729,698
4,356,827
15,009,731
Other markets
st
The amount of assets and liabilities at 31 December 2015 and 2014 include amounts relating to ‘Assets held for sale’ (Note 28).
4. SALES AND SERVICES RENDERED
st
On 31 December 2015 and 2014, the breakdown of the sales and services rendered was as follows:
Revenue from the sale of merchandise
Revenue from the sale of goods
Services rendered
FY 2015
FY 2014
1,713,444
16,877,890
84,775,055
58,317,393
134,396,850
113,712,714
220,885,349
188,907,997
In 2015, sales and services rendered increased 17 %, when compared with 2014, to 220 million euros. This variation is the result of
the increase that occurred both in the Metallic Constructions and in the Renewables segments.
12
5. OTHER INCOME
st
On 31 December 2015 and 2014, the breakdown of the caption ‘Other income’ was as follows:
FY 2015
FY 2014
Change in production
(1,991,230)
656,997
Own work capitalised
1,557,460
5,042,877
33,739
-
Trade debtors (Note 24)
2,560,800
265,273
Other impairment losses
5,024,277
779,109
870,581
1,617,559
Taxes
Reversals of impairment losses:
Supplementary income
Gains in inventories
Capital gains in non-financial assets
Operating subsidies
Investments subsidies
Foreign exchange gains
Other operational gains
Total
2,021
34,019
12,510,304
20,454,680
134,676
222,470
50,332
164,322
6,077,593
4,101,128
4,869,810
3,572,572
31,700,364
36,911,006
The amount of ‘Change in production’ in 2015 is mainly related to Martifer – Construções Metálicas, Ltda. (Brazilian company sold
in September 2015) from the Metallic Constructions segment.
The amount of ‘Own work capitalized’ in 2015, as in the previous year, is essentially related to the construction of infrastructures in
the Metallic Constructions segment.
st
On 31 December 2015 ‘Capital Gains in non-financial assets’ include 9.5 million euros from the fair value gain registered with the
transfer of a real estate asset from inventories to investment property and its revaluation to fair value, as well as 1.6 million euros
st
related with capital gains in the sale of fixed assets. On 31 December 2014 the amount includes essentially the gains with the sale
of Rosa dos Ventos Geração e Comercialização de Energia, SA.
st
On 31 December 2015 for the reversal of impairment losses in ‘Trade debtors’ strongly contribute the companies in the Metallic
Constructions segment in Poland (2.1 million euros) and for the reversions in ‘Other impairment losses’ the reversion of
impairments related with ongoing projects in Portugal (2.8 million euros) and in Romania (2.15 million euros).
The caption ‘foreign exchange gains’ is related with exchange variations in non financial transactions, mainly in non-Euro Zone
Group companies (note 1).
From the amount included under ‘Other operational gains’ in 2015, we highlight 2 million euros due to the registry, in 2015, of the
deferred income related with the adjustment of sale price of the share in Repower Portugal.
6. COST OF GOODS SOLD
st
On 31 December 2015 and 2014 the cost of goods sold was as follows:
MERCHANDISE
RAW-MATERIALS, SUBSIDIARIES
AND OTHER CONSUMABLES
TOTAL
Opening balance
4,067,430
8,071,479
12,138,909
54,133,349
FY 2014
Purchases
9,666,850
44,466,499
Changes in the consolidation perimeter, currency exchange differences, transfers and others
(435,246)
(387,919)
(823,165)
Closing balance
3,276,957
6,843,327
10,120,284
10,022,077
45,306,732
55,328,809
12
RAW-MATERIALS, SUBSIDIARIES
AND OTHER CONSUMABLES
TOTAL
3,276,957
6,843,327
10,120,284
378,657
62,438,559
62,817,216
Changes in the consolidation perimeter, currency exchange differences, transfers and others
(190,729)
769,570
578,841
Closing balance
3,114,973
2,597,933
5,712,906
349,912
67,453,523
67,803,434
FY 2015
MERCHANDISE
Opening balance
Purchases
The increase in this caption in 2015 is a consequence of the increase in production and respective sales.
7. SUBCONTRACTORS
st
On 31 December 2015 and 2014, costs with subcontractors were as follows:
Subcontractors
FY 2015
FY 2014
53,741,731
33,997,204
53,741,731
33,997,204
The subcontracts are related with construction works carried out mainly in the ‘Metallic Constructions’ segment, and the increase in
the amount is connected with the sales and services rendered.
8. EXTERNAL SUPPLIES AND SERVICES
st
The breakdown in external supplies and services on 31 December 2015 and 2014 was as follows:
FY 2015
Transportation of goods
FY 2014
6,330,156
6,633,487
Specialized works
12,471,454
10,886,355
Leases and rents
18,359,871
12,272,660
898,950
1,485,836
Travelling expenses
2,604,158
3,996,127
Electricity and Fuel
3,021,670
2,827,055
Insurance
2,051,345
2,308,957
Maintenance and repairs
1,829,861
1,563,430
Communications
669,926
897,904
Security
873,490
892,985
Legal and notarial fees
401,973
183,388
Commissions
748,920
195,971
Advertising
293,906
391,483
Cleaning, health and safety
511,766
544,284
Service Fees
Tools and devices
Other
407,058
326,772
2,203,310
2,980,819
53,677,811
48,387,513
In general, an increase of external supplies and services is verified, following the increase in activity in 2015, with highlight to
Leases and rents.
Specialized works include costs with auditing, consulting, information systems, studies and reports.
12
9. STAFF COSTS
st
On 31 December 2015 and 2014, staff costs were as follows:
FY 2015
FY 2014
Salaries
39,951,103
45,335,404
Social contributions and others
11,076,227
12,816,447
51,027,329
58,151,851
The social charges relate primarily to social security contributions, the food and health subsidies, insurance costs and indemnities.
AVERAGE STAFF NUMBERS
During 2015 and 2014, the Group’s average staff numbers were as follows:
FY 2015
Directors
Other employees
Portuguese
Portuguese in foreign countries and foreigners
FY 2014
15
18
1,702
2,649
1,717
2,667
1,112
1,389
605
1,278
1,717
2,667
FY 2015
FY 2014
2,612,443
5,575,851
10. OTHER EXPENSES
st
On 31 December 2015 and 2014, other expenses were as follows:
Taxes
Impairment losses
Trade debtors (Note 24)
3,877,669
592,161
Other impairment losses
-
3,268,582
Losses in inventories
Losses in non-financial assets
Foreign exchange losses
Trade debtors write-off
Fines and penalties
Other operational losses
992
81
215,992
9,002,765
4,678,291
2,305,869
(1,827)
263,854
583,776
246,485
2,978,916
2,693,926
14,946,252
23,949,574
The caption Impairment Losses in ‘Clients’ includes an impairment registered by Martifer Renewables Brasil Participações Ltda.,
totalling 3,173,742 euros, related with the balance with Martifer – Construções Metálicas, Ltda. With the sale of the company
Martifer – Construções Metálicas, Ltda and the economic recession in Brazil, it was considered that this balance will be of hard
recovery, and so the impairment was recognized. In 2014 this caption included losses with the sale of assets in Metallic
Constructions and with expenses with discontinued wind projects in Brazil.
The caption ‘Unfavourable exchange differences’ is related with the occurrence of foreign exchange variations in non-financial
transactions, primarily in the non-Euro Zone Group affiliates (Note 1).
In 2014, ‘Other impairment losses’ includes impairments in inventories and impairments associated with ongoing projects in the
Metallic Constructions segment.
In 2015, in ‘Other operational losses’, we highlight the amount of 1.6 million euros related with a lost legal process on Budimex in
Poland.
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11. PROVISIONS AND IMPAIRMENT LOSSES
st
The provisions and impairment losses for the periods ended on 31 December 2015 and 2014 were as follows:
FY 2015
FY 2014
1,515,437
3,992
Impairment losses
in financial assets (Note 21)
In intangible assets (Note 16)
1,295
-
921,981
2,053,179
2,438,713
2,057,171
In tangible assets (Note 17)
Provisions (Note 33)
Arising from the use of the equity method
215,000
511,790
Quality guarantees
107,620
(63,456)
Onerous contracts
(4,038,972)
26,744,094
(35,569)
8,584,261
1,241,704
797,176
(2,510,217)
36,573,865
Others
‘Provisions for onerous contracts’ are related to ongoing construction contracts in which it is estimated that the costs associated
with the obligation exceeds the forecasted economic benefits. These provisions are mainly related with the Metallic Constructions
segment. In 2015, the amount of provisions related to onerous contracts is negative since they were used or reverted.
In 2014, the reinforcement of provisions for ‘Legal claims in progress’ is mainly due to a provision in Martifer Construções for an
indemnity to Alstom related to the Sostanj (Slovenia) and the Manheim (Germany) legal claims. This indemnity was agreed and
paid in 2015.
12. NET FINANCIAL RESULTS
st
The net financial results for the years ended on 31 December 2015 and 2014 may be analysed as follows:
FINANCIAL INCOME
FY 2015
FY 2014
1,735,855
1,323,391
- Foreign exchange gains
3,671,489
3,018,807
- Gains on the sale of financial assets
6,959,341
(99,225)
Loans and accounts receivable (including bank deposits)
- Interest income
Other financial income related to other financial assets
- Other financial income
6,958,023
4,874,432
19,324,708
9,117,405
FY 2015
FY 2014
8,352,517
22,703,297
- Foreign exchange losses
4,695,819
2,188,076
- Other financial expenses
3,202,822
4,804,692
16,251,158
29,696,065
FINANCIAL EXPENSES
Loans and accounts payable
- Interest expenses in bank loans and in finance leases
Other financial income related to other financial liabilities
The amount in the caption ‘Gains on the sale of financial assets’ is related with the capital gains arising from the sale of Eviva
Gizalki Sp. Zoo (Note 21).
The captions ‘Foreign exchange gains / (losses)’ are essentially related with exchange variations registered in non-Euro Zone
Group companies (Note 1).
12
‘Other financial income’ in 2015 concern mainly to the gain arising from the debt renegotiation process with Banco Bilbao y
Viszcaya, in which the financing was amortized with a discount on the outstanding capital and a partial pardon of interests.
The ‘other financial expenses’ concern mainly with bank commission costs, in which expenses with bank guarantees are included.
The decrease in ‘Interest expenses in bank loans and in finance leases’, from 22.7 million euros in 2014 to 8.35 million euros in
2015 is due to the decrease in the spread associated to contracts under the financial debt restructuring signed with the financial
st
credit institutions on December 2015 and with retroactive effects to 1 January 2015.
13. GAINS / (LOSSES) IN ASSOCIATE COMPANIES AND JOINT ARRANGEMENTS
st
On 31 December 2015 and 2014, the gains and losses in associate companies and joint-ventures were as follows:
FY 2015
FY 2014
Nutre Group
-
1,364,038
Prio Energy Group
-
(171,551)
SPEE 2 – Parque Eólico de Vila Franca de Xira, S.A.
472,172
482,476
SPEE 3 – Parque Eólico do Baião, S.A.
153,689
202,079
Promoquatro – Investimentos Imobiliários, Lda.
-
(120,260)
Liskin Green Park
-
(28,495)
Eviva Gizalki Sp. ZO.o
(73,516)
(234,968)
Martifer Amal (Mozambique)
(141,404)
(212,198)
Martimetal
(446,708)
(106,202)
Other
-
(2,104)
(35,768)
1,172,815
The detail of the financial investments is presented in Note 21.
14. INCOME TAX
st
The detail of the assets and liabilities that originated deferred taxes on 31 December 2015 and 2014 was as follows:
FY 2015
DEDUCTIBLE TEMPORARY DIFFERENCES
FY 2014
BASIS
DEFERRED TAX
BASIS
DEFERRED TAX
7,410,159
1,852,540
122,377
41,608
21,349,590
4,770,794
17,641,521
4,556,170
84,482
With impact in Net Profit
Provisions not accepted for tax purposes
Tax losses
Other
Deferred Tax Assets Compensation
5,437,444
1,233,943
775,607
(9,300,000)
(1,953,000)
-
-
24,897,193
5,904,277
18,539,505
4,682,260
252,863
37,929
252,863
37,929
252,863
37,929
252,863
37,929
25,150,056
5,942,206
18,792,368
4,720,190
With impact in Equity
Other
12
FY 2015
TAXABLE TEMPORARY DIFFERENCES
BASIS
FY 2014
DEFERRED TAX
BASIS
DEFERRED TAX
With impact in Net Profit
Differences between cost and fair value
1,197,918
317,448
1,197,918
317,448
Deferral of capital gains taxation
(450,750)
(119,449)
(450,750)
(119,449)
78,030
Accruals not accepted for tax purposes
Investment properties revaluation
294,452
78,030
294,452
9,300,000
1,953,000
-
-
17,677
3,359
17,639
3,351
(9,300,000)
(1,953,000)
-
-
1,059,297
279,388
1,059,259
279,381
2,334,898
605,354
3,260,832
619,558
140,510
31,557
140,510
31,557
2,475,408
636,911
3,401,343
651,115
3,534,705
916,299
4,460,602
930,496
Other
Deferred tax liabilities Compensation
With impact in Equity
Fair value on the acquisition of subsidiaries
Other
The deferred tax assets and deferred tax liabilities of tax losses and to investment properties revaluation include an amount of
9,300,000 euros in bases and 1,953,000 euros in tax, which were compensated, since it is forecasted by the Board of Directors that
the Investment Property will be sold in the deferred tax assets recovery period, which means that at the moment of sale these
deferred tax assets and deferred tax liabilities will be used simultaneously.
Deferred tax assets and liabilities, by geography, are as follows:
DEFERRED TAX ASSETS
DEFERRED TAX LIABILITIES
FY 2015
FY 2014
FY 2015
FY 2014
Portugal
2,102,431
2,116,635
912,940
927,145
Spain
3,330,721
2,056,022
-
Brazil
-
41,608
-
3,351
Poland
Romania
USA
Other
-
-
3,359
440,441
444,488
-
-
61,437
-
-
68,614
-
-
-
5,942,206
4,720,190
916,299
930,496
According to tax returns and tax estimates of the companies that recognize deferred tax assets in respect of tax losses carried
st
forward, on 31 December 2014 and 2013, using tax rates applicable on those dates, the details are as follows:
FY 2015
TIME LIMIT
FY 2014
BASIS
DEFERRED TAX
BASIS
DEFERRED TAX
2015
-
-
393,193
104,196
2016
360,492
28,523
6,436,793
1,638,744
2017
-
-
3,958,129
757,208
2020
-
-
1,687,494
506,247
2021
-
-
3,373,785
849,055
2022
2,752,753
440,441
369,254
110,775
2024
-
-
1,422,872
589,946
-
2026
8,562,058
2,255,258
-
2027
9,300,000
1,953,000
-
-
20,975,303
4,677,222
17,641,520
4,556,170
Without time limit
374,286
93,572
-
-
21,349,590
4,770,794
17,641,521
4,556,170
12
st
On 31 December 2015, the deferred tax assets and liabilities were, respectively, 5,942,206 euros and 916,299 euros (2014:
4,720,190 euros and 930,496 euros, respectively), with a positive impact on the income statement of 1,329,116 (in 2013, negative
impact of 1,681,071 euros).
In 2014, deferred tax assets recognized on tax losses were annulled in what concerns risks of recoverability materialized, based on
projections made by the respective businesses. We highlight the value of deferred taxes in the Solar segment, concerning the
activity in the USA, included in ‘Result from discontinued operations’ (note 28).
st
On 31 December 2015 and 2014, taking into consideration the Portuguese tax legislation applicable to dividends, no deferred tax
liabilities were recorded for the timing differences arising on the appropriation of the results of affiliated companies, due to their
immaterial effect on the accompanying financial statements.
st
On 31 December 2015 there are tax losses carried forward, in the companies taxed under the groups of companies’ mechanism
(Regime Especial de Tributação de Grupos de Sociedades “RETGS”), in which Martifer SGPS is the dominant company, before
st
and after the application of RETGS, amounting 175,762,608 euros (197,928,781 euros on 31 December 2014), which potential
st
deferred tax assets reach 39,546,587 euros (44,533,976 euros on 31 December 2014). As caution, deferred tax assets related
with tax losses in Portugal were recorded to use in the future, only in the amount of 3,980,136 euros.
The breakdown of the total tax losses carried forward and credit potential may be analysed as follows:
FY 2015
FY 2014
TAX LOSS
TAX CREDIT
TIME LIMIT
TAX LOSS
TAX CREDIT
TIME LIMIT
Generated in 2008
26,678,470
6,002,656
2,015
27,564,225
6,201,951
2,014
Generated in 2009
11,817,774
2,658,999
2015/2016
11,817,774
2,658,999
2,015
Generated in 2010
12,722,095
2,862,471
2,017
19,515,648
4,391,021
2,014
Generated in 2011
24,942,511
5,612,065
2,015
24,942,511
5,612,065
2,015
Generated in 2012
24,924,811
5,608,082
2,017
24,924,811
5,608,082
2,017
Generated in 2013
37,128,240
8,353,854
2,018
37,128,240
8,353,854
2,018
Generated in 2014
31,138,106
7,006,074
2,026
52,035,572
11,708,004
2,026
Generated in 2015
6,410,603
1,442,386
2,027
-
-
-
175,762,608
39,546,587
197,928,781
44,533,976
The reconciliation between current tax and income tax is summarized as follows:
Current tax
Deferred tax - generated by temporary differences
Deferred tax - reversal of temporary differences
Effect of changes in the income tax rate
Deferred tax assets- tax losses recognition
Other
Deferred tax
Income tax
FY 2015
FY 2014
1,874,812
3,183,186
(1,007,392)
(95,748)
67,888
2,541,671
-
(26,141)
(214,624)
(591,826)
(174,988)
(146,886)
(1,329,116)
1,681,071
545,697
4,864,257
12
st
On 31 December 2015 and 2014, the reconciliation between the current and effective tax rate is as follows:
FY 2015
FY 2014
2,518,765
(66,666,188)
528,941
(16,333,216)
Sale of financial assets
(1,461,462)
(2,321,616)
Investment properties revaluation
(1,953,000)
-
1,953,000
-
Profit before tax
Income tax rate (nominal rate of 21% and 24,5% - contains municipal surcharge)
Non-taxable gains and losses:
Registration of deferred tax on tax losses
Reversions/Amortizations on revalued fixed assets
325,109
-
Impairment losses
294,181
504,007
Others
Results of associates using equity method
(932,789)
652,835
(7,511)
(287,340)
Tax benefits
(409,424)
(274,222)
Not recognized deferred tax assets arising from losses of current year
2,902,994
16,973,761
Creation / Reversion of deferred tax assets in the year
(1,400,000)
2,541,671
Different tax rates
143,796
3,352,954
Municipal surcharge and autonomous taxes
440,023
-
Excess/ Insufficiency of income tax estimate
121,839
55,423
Effective income tax
545,697
4,864,257
In 2015, Martifer SGPS and its companies located in Portugal are individually taxed and are subject to a tax rate of 21 % in terms of
corporate income tax (‘Imposto sobre o Rendimento das Pessoas Coletivas’ or IRC), increased by a municipal surcharge that can
reach 1.5 % of the taxable profit.
Additionally, on the portion of taxable profits above 1,500,000 euros and not exempt from corporate income tax (IRC), the following
additional state surcharges are applied: 3 % on the amount above 1,500,000 euros and up to 7,500,000 euros; 5 % on the amount
above 7,500,000 euros and up to 35,000,000 euros; and 7 % on the amount of taxable profits which exceed 35,000,000 euros.
According to Article 88 of the Tax Code ‘Imposto sobre o Rendimento das Pessoas Coletivas’, Portuguese companies are also
subject to autonomous taxes on some expenses, at tax rates defined in the said code.
During 2011, Martifer SGPS, SA opted for the special taxation of groups of companies’ mechanism (Regime Especial de Tributação
de Grupos de Sociedades “RETGS”), which contemplates the companies in which it holds, directly or indirectly, at least 75 % of
their capital and that simultaneously meet the other conditions set by that mechanism.
The remaining affiliated companies of the Group, not contemplated by this mechanism, are taxed individually, based on their
taxable profits and the tax rates applicable.
st
After the changes in corporate income tax (IRC) for 2015, decreed on 31 December 2014, deferred taxes in Portugal were
calculated based on a 21 % rate.
The net income generated by foreign subsidiaries is taxed at local tax rates, namely, those generated in Spain, in Poland, in Romania,
in France, in Italy, in Belgium, in the United States of America, in Brazil and in the United Kingdom are taxed at 28 %, 19 %, 16 %,
34.43 %, 27.5 %, 33.99 %, 35 %, 34 % and 20 % respectively.
According to the current tax legislation in Portugal, tax returns of Portuguese companies can be reviewed by the tax authorities for a
period of four years (and five years for Social Security), except when tax losses have been generated, tax benefits have been
granted or when any review, claim or impugnation is in course, under which circumstances the periods can be extended or
suspended. Therefore, all annual tax returns for the year 2012 through 2015 are still open to such review.
st
On 31 December 2015 and 2014, income tax receivable and payable is as follows:
FY 2015
Income tax – Assets
FY 2014
1,029,684
744,905
Income tax – Liabilities
(2,257,208)
(1,258,326)
Net income tax
(1,227,524)
(513,421)
12
15. DIVIDENDS
In 2015 and 2014, the Group did not distribute dividends.
16. EARNINGS PER SHARE
Martifer SGPS, SA has only issued ordinary shares and, as such, no shares have special voting or dividend rights.
Martifer has just one type of potential ordinary dilutive shares: stock options. In order to calculate diluted earnings per share it is
necessary to determine whether these stock options, irrespective of whether they are exercised or not, have a diluting effect, which
happens when the option exercise price is lower than the average market price of the shares.
st
st
Since the average market price of Martifer’ s shares, during the period between 1 January 2015 and 31 December 2015, was
0.29 euros, below that of the exercise price of the stock options (Euro 3.84), these stock options are non-diluting because, if the
options were to be exercised, the number of outstanding shares would be reduced.
st
Therefore, on 31 December 2015 there are no differences between the basic earnings per share and the diluted earnings per
share calculation. The share capital of Martifer SGPS, SA is represented by 100,000,000 ordinary shares, fully paid up,
representing a share capital of Euro 50,000,000.
The average number of shares outstanding is net of 2,215,910 shares corresponding to the volume of own shares acquired by
Martifer SGPS, SA.
st
On 31 December 2015 and 2014, the basic and diluted earnings per share may be summarised as follows:
Profit for the year (I)
Weighted average number of shares outstanding (II)
Basic and diluted earnings per share (I) / (II)
from continuing operations
from assets held for sale
FY 2015
FY 2014
(482,490)
(93,535,824)
97,784,090
97,784,090
(0.0049)
(0.9566)
0.0052
(0.6422)
(0.0102)
(0.3144)
17. GOODWILL
st
The movements occurring during the years ended on 31 December 2015 and 2014 may be summarised as follows:
FY 2015
FY 2014
15,639,252
17,568,009
Gross amount
Opening balance
Acquisition of subsidiaries
-
329,311
Sale of subsidiaries
-
(359,777)
Effect of foreign currency exchange differences
-
(16,145)
Reclassification of non-current assets held for sale (Note 28)
-
(1,882,146)
15,639,252
15,639,252
Opening balance
4,658,577
4,658,577
Closing balance
4,658,577
4,658,577
Carrying amount at the beginning of the period
10,980,675
12,909,432
Carrying amount at the end of the period
10,980,675
10,980,675
Closing balance
Accumulated impairment losses
12
st
st
The breakdown of ‘Goodwill’, on 31 December 2015 and on 31 December 2014, was as follows:
FY 2015
COST
FY 2014
IMPAIRMENT LOSSES
CARRYING AMOUNT
CARRYING AMOUNT
5,448,792
5,448,792
-
5,448,792
Sassall Aluminium
4,658,577
(4,658,577)
-
-
3,898,809
-
3,898,809
3,898,809
Navalria
1,618,675
-
1,618,675
1,618,675
MGI
8,373
-
8,373
8,373
Martifer GmbH
6,026
-
6,026
6,026
15,639,252
(4,658,577)
10,980,675
10,980,675
Both the fair value allocation of the assets and liabilities acquired and the goodwill calculation were performed using the financial
statements of the acquired companies at the date of acquisition.
The Group performs annual impairment tests on Goodwill, at the end of each year, as disclosed in the section ‘Main accounting
policies, judgements and estimates’.
For impairment assessment purposes, Goodwill was allocated to the cash generating units that are expected to benefit from the
business combination within each operational segment. The recoverable amount for each cash generating unit was determined
based on its value in use, using the discounted cash flow method, supported by the business plans drawn up by the persons in
charge of each unit and approved by the Board of Directors of the Group. Different discount rates were used according to the risks
inherent to each company.
st
On 31 December 2015, the methods and assumptions used in the identification, or not, of any impairment loss in the more
significant amounts of Goodwill recorded by each of the segments in the accompanying financial statements, was as follows:
MARTIFER
CONSTRUÇÕES
Goodwill
(1)
Period used
Growth rate (g) (2)
Average growth rate of Turnover for 5 years
Discount rate (4)
(1)
(2)
(3)
(4)
(3)
MARTIFER METALLIC
CONSTRUCTIONS
NAVALRIA
5,449
3,899
1,619
5 years cash flow
projection
5 years cash flow
projection
5 years cash flow
projection
2%
2%
1%
7.72%
10.20%
7.97%
6.95%
6.95%
7.25%
Values in thousand euros
Growth rate used to extrapolate cash flows beyond the business plan period
Average growth rate estimated based on the company’s 5-year business plan, carried out according to the Board of Directors’ estimates and assumptions, based on
their best knowledge at the date of the approval of financial statements
Discount rate applied to the projected cash flows
The average turnover growth calculated in each segment underlies the following estimates and expectations: (i) in Martifer
Construções, a stagnation in 2016 and from 2017 on a 10 % annual growth, resulting from projects in the order book, which
development will mostly occur on the second half of 2016 and in 2017, several proposals in an advanced stage of negotiation and
which award is expected to occur in 2016 and the announced consolidation of the economic recovery, with a sharper growth in the
Portuguese economy and in the main world economies; (ii) in Martifer Metallic Constructions, a 10 % annual growth, resulting from
the estimated growth in the Metallic Constructions area, due to projects, both ongoing or expecting award, as well as by the entry
on new markets or growth in markets where Martifer has already a strong presence and which economies are estimated to growth
sharper than in the previous years, and by the consolidation of growth in shipbuilding, in which the rhythm of projects awarded has
been very significant; (iii) in Navalria, the sharp growth rate the naval area has been facing, both in shipbuilding and repair, and
synergies with West Sea.
The Board of Directors, based on the discounted value of the provisional cash flows of the cash generating units of this business
st
segment, discounted at the applicable rate, concluded that, on 31 December 2015, the carrying amount of the net assets,
including Goodwill, did not exceed its recoverable amount.
12
The projected cash flows are based on the historic performance and on the expectations of efficiency improvements. Those in
charge of this segment believe that (in a scenario of normality) a change in the main assumptions used in the calculation of the
recoverable amount would have the impact shown on the following table:
MARTIFER CONSTRUÇÕES:
6.95%
6.95%
6.95%
2.72%
7.72%
7.72%
7.07%
7.57%
6.57%
5.95%
6.95%
7.72%
12.72%
7.07%
7.07%
WACC
DECREASE
IN 1.0 P.P.
Weighted Average Cost of Capital (WACC)
6.95%
7.95%
Average growth rate turnover [2015;2020] (3)
7.72%
7.72%
EBITDA / Turnover average margin [2015;2020]
7.07%
7.07%
Net Book Value
DECREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
VAR.
TURNOVER
WACC
INCREASE IN
1.0 P.P.
(4)
INCREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
VAR.
TURNOVER
+5.0 P.P. (1)
MARTIFER
CONSTRUÇÕES
-5.0 P.P. (1)
5,449
5,449
5,449
5,449
5,449
5,449
5,449
Total recoverable amount (4)
39,558
20,147
68,891
68,857
16,535
46,142
29,481
Estimated impact (4)
34,109
14,698
63,442
63,409
11,086
40,694
24,032
No
impairment
No
impairment
No
impairment
No
impairment
No
impairment
No
impairment
No
impairment
Conclusions of the sensitivity analysis
(1)
(2)
(3)
(4)
Yearly variation of turnover in 5 p.p. (2015 = 100 %), maintaining a constant EBITDA / Turnover margin
Variation in EBITDA / Turnover margin, maintaining a constant turnover
Estimated Average growth rate based on the company’s 5-year business plan, carried out according to the Board of Directors’ estimates and assumptions
Amounts in thousand euros
MARTIFER METALLIC CONSTRUCTIONS:
MMC
Net Book Value
(4)
WACC
INCREASE IN
1.0 P.P.
WACC
DECREASE
IN 1.0 P.P.
VAR.
TURNOVER
+5.0 P.P. (1)
VAR.
TURNOVER
-5.0 P.P. (1)
INCREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
DECREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
6.95%
7.95%
5.95%
6.95%
6.95%
6.95%
6.95%
10.20%
10.20%
10.20%
15.20%
5.20%
10.20%
10.20%
5.20%
5.20%
5.20%
5.20%
5.20%
5.70%
4.70%
3,899
3,899
3,899
3,899
3,899
3,899
3,899
42,994
20,835
76,276
82,695
9,289
72,232
36,369
39,095
16,936
72,377
78,797
5,390
68,333
32,470
No
impairment
No
impairment
No
impairment
No
impairment
No
impairment
No
impairment
No
impairment
(1)
(2)
(3)
(4)
NAVALRIA:
INCREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
DECREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
7.25%
7.25%
7.25%
7.47%
7.97%
7.97%
MMC
WACC
INCREASE IN
1.0 P.P.
WACC
DECREASE
IN 1.0 P.P.
VAR.
TURNOVER
+5.0 P.P. (1)
VAR.
TURNOVER
7.25%
8.25%
6.25%
7.25%
7.97%
7.97%
7.97%
8.47%
-5.0 P.P. (1)
12.58%
12.58%
12.58%
12.58%
12.58%
13.08%
12.08%
Net Book Value (4)
1,619
1,619
1,619
1,619
1,619
1,619
1,619
1,800
874
3,084
1,797
1,488
1,057
535
182
(745)
1,465
178
(131)
(562)
(1,083)
No
impairment
Impairment
No
impairment
No
impairment
Impairment
Impairment
Impairment
Estimated impact
(4)
(1)
(2)
(3)
(4)
12
18. INTANGIBLE ASSETS
This caption is analysed as follows:
FY 2015
FY 2014
18,213,095
18,687,921
Gross amount, reduced by impairment losses:
Software and other rights
Intangible assets in progress
-
127,117
18,213,095
18,815,038
15,308,505
14,487,566
15,308,505
14,487,566
2,904,590
4,327,472
Accumulated depreciation:
Software and other rights
Carrying amount
The value registered in ‘Software and other rights’ is mainly related with computer software acquired by the Group companies.
st
The gross amount of ‘Intangible assets’, net of impairment losses, for the periods ended on 31 December 2015 and 2014, may be
analysed as follows:
FY 2014
Opening balance 1st January 2014
Reclassification to non current assets held for sale (note 28)
Additions
Sales, disposals and write-offs
SOFTWARE AND
OTHER RIGHTS
INTANGIBLE
ASSETS IN
PROGRESS
ADVANCES FOR THE
ACQUISITION OF
INTANGIBLE ASSETS
19,447,719
1,198,497
-
20,646,216
(448,746)
(967,150)
-
(1,415,896)
70,213
58,658
-
128,871
(636,924)
-
-
(636,924)
51,899
TOTAL
49,248
2,651
-
206,411
(165,540)
-
40,871
18,687,921
127,116
-
18,815,038
SOFTWARE AND
OTHER RIGHTS
INTANGIBLE
ASSETS IN
PROGRESS
ADVANCES FOR THE
ACQUISITION OF
INTANGIBLE ASSETS
TOTAL
18,687,921
127,116
-
18,815,038
348,219
-
-
348,219
(1,082)
-
-
(1,082)
(104,933)
-
-
(104,933)
(699,624)
(127,116)
-
(826,740)
Transfers and other movements
Closing balance 31st December 2014
FY 2015
Additions
Impairment losses (Note 11)
(1,295)
-
-
(1,295)
(16,111)
-
-
(16,111)
18,213,095
-
-
18,213,095
st
The amounts of the accumulated depreciation of ‘Intangible assets’, for the periods ended on 31 December 2015 and 2014, may
be analysed as follows:
SOFTWARE AND
OTHER RIGHTS
INTANGIBLE
ASSETS IN
PROGRESS
ADVANCES FOR THE
ACQUISITION OF
INTANGIBLE ASSETS
TOTAL
13,142,745
-
-
13,142,745
Reclassification to non current assets held for sale (note 28)
(384,741)
-
-
(384,741)
Additions
1,876,474
-
-
1,876,474
(168,199)
-
-
(168,199)
2,889
-
-
2,889
18,397
-
-
18,397
14,487,565
-
-
14,487,565
FY 2014
12
FY 2015
st
Opening balance 1 January 2015
Additions
SOFTWARE AND
OTHER RIGHTS
INTANGIBLE
ASSETS IN
PROGRESS
ADVANCES FOR THE
ACQUISITION OF
INTANGIBLE ASSETS
TOTAL
14,487,565
-
-
14,487,565
967,708
-
-
967,708
(814)
-
-
(814)
-
(24,591)
-
(156,596)
-
(24,591)
(156,596)
35,234
-
-
35,234
15,308,506
-
-
15,308,505
31 December 2014
4,200,356
127,116
-
4,327,473
31st December 2015
2,904,589
-
-
2,904,590
st
Closing balance 31 December 2015
Carrying Amount:
st
19. TANGIBLE FIXED ASSETS
This caption is analysed as follows:
FY 2015
FY 2014
Gross amount, reduced by impairment losses:
Land and buildings
82,087,659
85,294,132
Equipment
89,510,588
100,487,147
Tangible assets in progress
14,628,512
15,049,013
49,240,030
49,280,291
235,466,789
250,110,583
Land and buildings
21,024,326
20,957,152
Equipment
46,558,542
46,238,960
18,736,495
16,499,311
Accumulated depreciation:
Carrying amount
86,319,363
83,695,423
149,147,425
166,415,160
The gross amounts of land and buildings, equipment, tangible assets in progress and other fixed assets, net of impairment losses,
st
for the periods ended on 31 December 2015 and 2015, may be analysed as follows:
LAND AND
BUILDINGS
FY 2014
st
EQUIPMENT
TANGIBLE ASSETS
IN PROGRESS
OTHER
TANGIBLE ASSETS
TOTAL
102,774,906
125,126,470
12,988,029
54,281,804
295,171,209
Reclassification for assets held for sale (Note 28)
(10,600,418)
(14,618,301)
(4,100,050)
(5,223,749)
(34,542,518)
133,708
1,624,652
13,079,736
42,764
14,880,860
(21,883,844)
Additions
(15,953,853)
(3,987,325)
(2,069,800)
127,134
135,550
368,933
(98,007)
7,744
414,220
415,276
(11,845,539)
8,225,339
42,687
(3,162,237)
(2,053,179)
Impairment losses (note 11)
(1,408,318)
-
(644,861)
-
9,797,281
3,818,257
(12,331,373)
1,907
1,286,072
85,294,132
100,487,147
15,049,013
49,280,291
250,110,583
12
FY 2015
st
LAND AND
BUILDINGS
EQUIPMENT
TANGIBLE ASSETS
IN PROGRESS
OTHER
TANGIBLE ASSETS
TOTAL
250,110,583
85,294,132
100,487,147
15,049,013
49,280,291
Additions
576,798
2,202,992
1,222,958
5,860
4,008,608
(82,744)
(4,293,982)
(4,887)
-
(4,381,613)
(1,090,510)
(1,183,896)
(361,485)
(14,393)
(2,650,284)
-
(7,410,227)
197,811
(106,336)
(7,318,752)
(174,087)
(420,661)
(327,357)
-
(922,105)
(2,435,930)
129,214
(1,147,541)
74,609
(3,379,648)
82,087,659
89,510,587
14,628,512
49,240,031
235,466,789
Capital expenditure in 2015 was mainly applied in the Renewables segment, with a strong investment in Brazil, acquisition of
equipment and cost capitalization in projects under development, and in the Metallic Constructions segment, with special emphasis
to the naval area with the reinforcement of operational capacity in West Sea (Shipyard in Viana do Castelo) and to the increase in
basic equipment en Angola, in order to reinforce the production capacity in this country.
The changes in the consolidation perimeter occurred due to the sale of the construction segment in Brazil.
The amounts of the accumulated depreciation of land and buildings, equipment, tangible assets in progress and other fixed assets,
st
for the periods ended on 31 December 2015 and 2014, may be analysed as follows:
LAND AND
BUILDINGS
EQUIPMENT
TANGIBLE ASSETS
IN PROGRESS
OTHER
TANGIBLE ASSETS
TOTAL
19,542,256
50,836,318
-
15,247,837
85,626,412
Reclassification for assets held for sale
(1,009,295)
(11,288,164)
FY 2014
st
(1,699,554)
(8,579,315)
Additions
3,463,558
6,840,260
-
2,259,030
12,562,848
(454,373)
(2,918,943)
-
(1,482)
(3,374,798)
260,123
105,264
151,638
-
3,221
-
22
-
-
22
-
(91,019)
-
-
(91,019)
20,957,151
46,238,961
-
16,499,311
83,695,423
LAND AND
BUILDINGS
EQUIPMENT
TANGIBLE ASSETS
IN PROGRESS
OTHER
TANGIBLE ASSETS
TOTAL
20,957,151
46,238,961
-
16,499,311
83,695,423
2,845,912
4,822,928
-
2,258,567
9,927,407
(26,774)
(3,340,737)
-
-
(3,367,511)
(221,984)
(625,911)
-
(8,292)
(856,187)
75,149
(839,602)
-
(16,380)
(780,833)
(2,605,128)
302,904
-
3,289
(2,298,935)
21,024,326
46,558,543
-
18,736,495
86,319,364
31st December 2014
64,336,981
54,248,186
15,049,013
32,780,980
166,415,160
31st December 2015
61,063,333
42,952,044
14,628,512
30,503,536
149,147,425
FY 2015
st
Additions
Carrying Amount:
The valuation criteria and depreciation rates used for tangible fixed assets are disclosed in captions iv) and v) of the section ‘Main
accounting policies, judgements and estimates’ in Note 1 ‘Accounting Policies’.
st
The acquisition cost of tangible fixed assets held by the Group, acquired under financial leases, on 31 December 2015 amounted
to 23,919,554 euros and their carrying amount, at that date was 17,596,214. The amount of debts related to financial leases is
presented in Note 31.
st
On 31 December 2015 and 2014, there were no tangible fixed assets pledged or mortgaged to financial institutions as guarantees for
loans granted, except for those acquired through financial lease contracts or through Project Finance and those mentioned in Note 38.
During the year, the Group assessed the estimated recoverable amount of some tangible fixed assets, taking into account internal
and external factors which indicated that some assets might be recorded at a value higher than their recoverable amount.
12
The assessment of impairment losses in tangible and intangible fixed assets of the Group was based on the business plans of the
companies, using the assumptions described below.
RENEWABLES
SPAIN
(1)
Period
Growth rate (g)
(2)
Average growth rate of Turnover [2015; 2028]
(3)
(4)
ROMANIA
29,526
46,128
20 years
25 years
n.a.
n.a.
-0.95%
0.85%
7.67%
7.53%
(1)
Average growth rate estimated based on the company’s business plan, carried out according to the Board of Directors’ estimates and assumptions
(4)
(2)
(3)
recoverable amount would be impacted as follows:
SPAIN:
CASH
GENERATING
UNIT
Average growth rate turnover [2015;2028]
(3)
Present value of discounted cash flows – Imp.
test - Working Capital 2015 (4)
Net Book Value
(4)
Conclusions of sensitivity analysis
WACC
INCREASE IN
1.0 P.P.
WACC
DECREASE
IN 1.0 P.P.
VAR.
TURNOVER
+1.0 P.P. (1)
VAR.
TURNOVER
-1.0 P.P. (1)
INCREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
DECREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
7.67%
8.67%
6.67%
7.67%
7.67%
7.67%
7.67%
-0.95%
-0.95%
-0.95%
0.04%
-1.94%
-0.95%
-0.95%
77.34%
77.34%
77.34%
77.34%
77.34%
77.39%
77.29%
29,674
28,141
31,345
30,884
28,551
29,689
29,658
29,526
29,526
29,526
29,526
29,526
29,526
29,526
29,373
27,841
31,045
30,584
28,250
29,389
29,358
(153)
(1,685)
1,518
1,058
(1,276)
(137)
(168)
Impairment
No
impairment
No
impairment
Impairment
Impairment
Impairment
Impairment
(1)
(3)
Estimated average growth rate based on the company’s business plan, carried out according to the Board of Directors’ estimates and assumptions
(4)
(2)
ROMANIA:
(3)
Net Book Value
(4)
Total recoverable amount
(4)
CASH
GENERATING
UNIT
WACC
INCREASE IN
1.0 P.P.
WACC
DECREASE
IN 1.0 P.P.
VAR.
TURNOVER
+1.0 P.P. (1)
VAR.
TURNOVER
7.53%
8.53%
6.53%
7.53%
7.53%
-1.0 P.P. (1)
INCREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
DECREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
7.53%
7.53%
0.85%
0.85%
0.85%
1.86%
-0.16%
0.85%
0.85%
67.61%
67.61%
67.61%
67.61%
67.61%
67.66%
67.56%
46,128
46,128
46,128
46,128
46,128
46,128
46,128
46,168
42,807
49,948
49,925
42,793
46,198
46,138
40
(3,321)
3,820
3,797
(3,336)
70
10
Impairment
No
impairment
No
impairment
No
impairment
Impairment
No
impairment
No
impairment
(1)
Estimated average growth rate based on the company’s business plan, carried out according to the Board of Directors’ estimates and assumptions
(4)
(2)
(3)
12
In the period, impairments were recognized for all Oborniki assets owned in Poland, since there was a risk of non development due
to the current economic constraints around these projects.
MARTIFER CONSTRUÇÕES
(1)
34,266
Period
5 years
Growth rate (g)
(2)
2%
5-year average growth rate of Turnover
Discount rate
(3)
7.72%
(4)
6.95%
(1)
(3)
Average growth rate estimated based on the company’s 5-year business plan, carried out according to the Board of Directors’ estimates and assumptions
(4)
(2)
The average turnover growth calculated underlies a stagnation in 2016 and from 2017 on a 10 % annual growth, resulting from
projects in the order book, which development will mostly occur on the second half of 2016 and in 2017, several proposals in an
advanced stage of negotiation and which award is expected to occur in 2016 and the announced consolidation of the economic
recovery, with a sharper growth in the Portuguese economy and in the main world economies.
recoverable amount will not result in further impairment losses, as shown below:
(3)
INCREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
DECREASE IN
EBITDA/
TURNOVER
MARGIN
IN 0.5 P.P. (2)
6.95%
6.95%
6.95%
2.72%
7.72%
7.72%
VAR.
TURNOVER
+5.0 P.P. (1)
VAR.
TURNOVER
5.95%
6.95%
7.72%
12.72%
CASH
GENERATING
UNIT
WACC
INCREASE IN
1.0 P.P.
WACC
DECREASE
IN 1.0 P.P.
6.95%
7.95%
7.72%
7.72%
-5.0 P.P. (1)
7.07%
7.07%
7.07%
7.07%
7.07%
7.57%
6.57%
Net Book Value (4)
34,266
34,266
34,266
34,266
34,266
34,266
34,266
98,279
78,867
127,611
127,578
75,256
104,863
88,201
64,013
44,602
93,346
93,312
40,990
70,597
53,936
No
impairment
No
impairment
No
impairment
No
impairment
No
impairment
No
impairment
No
impairment
Estimated impact
(4)
(1)
(3)
Average growth rate estimated based on the company’s 5-year business plan, carried out according to the Board of Directors’ estimates and assumptions
(4)
(2)
20. INVESTMENT PROPERTIES
The caption ‘Investment properties’ relates to the following investment properties held by the Martifer Group: Benavente Business
Centre, Warehouses in Albergaria-a-Velha and “Martifer Construções property”, all located in Portugal, as well as the Szczecin real
estate project in Poland, all held for rental income or sale.
These assets are carried at their fair market value, based on independent appraisals made by specialized entities, applying the
RICS Valuation Standards (RICS Red Book). Martifer Group performs regular revaluations of these properties and the eventual
changes in fair value are registered in the results. In 2015, an exception was made in the Szczecin real estate project, as explained
below.
12
In 2015 and 2014, the movements occurring in the caption ‘Investment properties’ were as follows:
FY 2015
FY 2014
Opening balance
14,367,300
16,195,865
Sales and disposals
(3,588,000)
-
Transfers and other
-
(1,828,565)
10,047,000
-
5,114,528
-
Transfers - Martifer Construções property
Transfers - Szcecin (Note 28)
10,881
Closing balance
25,951,708
14,367,300
In 2015, the Vagos industrial unit was sold, and the Szcecin real estate project (in 2014 considered as an asset held for sale – Note
28) and Martifer Construções property were transferred to investment property.
The table below presents the global value of the assessments performed in the period, as well as the values at which the assets are
booked in the Group’s financial statements:
FAIR VALUE
INDEPENDENT
APPRAISAL
Mad. Vouga
1,415,300
1,419,000
Benavente
9,364,000
9,310,000
Szczecin
5,125,408
4,564,296
10,047,000
10,131,000
25,951,707
25,424,296
FY 2015
Martifer Construções Property
In 2015, the Szczecin municipality expropriated part of the land included in the Szczecin real estate projects and the amount of
compensation to earn from this expropriation is currently under discussion. The independent evaluation value reflects only the part
of the land that remains a property of Martifer SGPS. No fair value variation was registered, since it will only be definitely calculated
when the compensation value on the referred expropriation is decided. The board of Directors expects that the difference from the
book value will be recovered.
Earnings obtained from investment properties in 2015 amounted to 361,530 euros (444,992 euros in 2014) and are recorded in the
caption ‘Sales and Services Rendered’.
21. FINANCIAL ASSETS UNDER THE EQUITY METHOD
st
On 31 December 2015 and 2014, financial assets under the equity method were as follows:
Prio Energy
% SHARES HELD FY 2014
EQUITY FY 2014
NET INCOME FY 2014
FY 2014
5.00%
30,220,314
1,160,419
1,511,016
100.00%
3,877,141
(122,779)
3,877,141
Martimetal
49.00%
1,197,688
(216,739)
586,867
SPEE 3 - Parque eólico de Baião, SA
50.00%
1,063,864
404,158
531,932
SPEE 2 - Parque eólico de Vila Franca de Xira, SA
50.00%
2,311,319
964,952
1,155,660
Promoquatro - Investimentos Imobiliários, Lda.
50.00%
(537,945)
(778,465)
-
Martifer Amal, S.A. (Portugal)
30.00%
(43,050)
Martifer Amal, S.A. (Mozambique)
35.00%
404,013
(563,423)
141,404
Eviva Gizalki
Other
-
(5,504)
7,798,516
12
% SHARES HELD FY 2015
EQUITY FY 2015
NET INCOME FY 2015
Prio Energy
5.00%
35,503,367
5,181,266
-
Martimetal
49.00%
2,741,905
(911,649)
1,343,533
SPEE 3 - Parque eólico de Baião, SA
50.00%
1,091,242
307,378
545,621
SPEE 2 - Parque eólico de Vila Franca de Xira, SA
50.00%
2,505,662
944,343
1,252,831
Martifer Amal, S.A. (Mozambique)
35.00%
(39,833)
(416,645)
Other
FY 2015
-
-
8,659
3,150,644
The presented equity values are net of supplementary payments.
In 2015, we highlight the sale of Eviva Gizalki (Note 12) and the registration of impairment on the amount of investment in Prio
Energy SGPS, S.A., identified in the table below, with the remaining variation in investment value resulting from the activity in the
companies in 2015.
st
On 31 December 2015 and 2014, the movements occurring in this caption were as follows:
FY 2015
FY 2014
Opening balance
7,798,516
41,282,069
Acquisitions
1,267,975
683,389
Application of the equity method:
- From performance in results
- Other equity changes
Sales
(35,768)
1,172,815
(489,442)
(2,585,199)
(4,010,167)
Changes resulting from the loss of control in subsidiaries
-
3,877,141
Reclassification to assets held for sale
-
(36,620,942)
Other changes
Impairments movements (nota 11)
Closing balance
133,607
-
1,360
(10,757)
(1,515,437)
-
3,150,644
7,798,516
In the end of the 2015, the share held by the Group in Prio Energy was considered in impairment since it is not expected any return, and
this share was afterwards transferred to other available for sale investments, due to the lack of significant influence over the company
22. AVAILABLE FOR SALE INVESTMENTS
st
On 31 December 2015 and 2014, available for sale investments were the following:
Non-current financial investments
FY 2015
FY 2014
4,040,920
1,954,435
Others
225,314
237,077
4,266,234
2,191,512
The movements occurring in the caption ‘Available-for-sale investments’ in 2015 and 2014 were as follows:
FY 2015
FY 2014
Opening balance
2,191,512
575,622
Additions
2,084,175
1,896,367
(1,003)
(24,715)
Reductions
Reclassification to assets held for sale
Other
Closing balance
-
(10,378)
(8,451)
(245,384)
4,266,234
2,191,512
The increase in this caption in 2015, as occurred in 2014, is due to the attribution of green certificates held by Eviva Nalbant, Srl.
The available for sale investments do not have a defined maturity.
12
23. INVENTORIES
st
On 31 December 2015 and 2014, inventories were as follows:
FY 2015
FY 2014
Raw-materials, subsidiaries and other consumables
2,473,717
5,611,712
Work in progress
3,616,333
3,610,149
Merchandise
2,354,765
2,596,749
Finished and intermediate goods
212,626
3,316,921
8,657,442
15,135,531
In 2014, a decrease in inventories occurred, when compared with 2013, as a consequence of the reduction in the Group’s activity
and of the reclassification of the Solar segment as a non-current asset held for sale.
24. TRADE RECEIVABLES AND OTHER RECEIVABLES
st
On 31 December 2015 and 2014, trade receivables and other receivables, other than those previously described in Notes 21 and
22, are detailed below.
st
The detail of the captions ‘Trade receivables’ and ‘Other receivables’, for the periods ended on 31 December 2015 and 2014, is as
follows:
NON CURRENT
CURRENT
FY 2015
FY 2014
FY 2015
FY 2014
910,432
739,397
75,714,449
87,642,194
-
-
10,027,163
12,390,293
910,432
739,397
85,741,612
100,032,487
35,765,018
38,524,408
12,472,065
13,635,740
-
5,222
6,898,890
7,194,649
3,255,257
22,997,663
38,562,766
20,615,943
39,020,275
61,527,293
57,933,721
41,446,332
39,930,707
62,266,690
143,675,333
141,478,819
Cost:
Trade receivables:
Trade receivables
Doubtful trade receivables
Other receivables:
Related companies (Note 40)
Advances to suppliers
Others
The caption ‘Others’ includes 19.6 million euros related to the sale of the 49 % share held in Nutre to CERES AGRICULTURE
HOLDINGS COÖPERATIEF U.A., since the share purchase agreement defines that the value is due in 2016.
Accumulated impairment losses in accounts receivable are as follows:
NON-CURRENT
31ST DECEMBER 2015
CURRENT
31ST DECEMBER 2014
31ST DECEMBER 2015
31ST DECEMBER 2014
12,449,720
Accumulated impairment losses:
-
-
10,755,481
3,267,774
115,839
5,172,610
5,258,404
3,267,774
115,839
15,928,091
17,708,124
Carrying amount – trade receivables
910,432
739,397
74,986,131
87,582,767
Carrying amount – other receivables
35,752,501
61,411,454
52,761,110
36,187,928
Total
36,662,933
62,150,851
127,747,241
123,770,695
Other receivables
12
The changes in accumulated impairment losses relating to accounts receivable are as follows:
TRADE RECEIVABLES
Opening balance
Additions (note 10)
Reductions (Note 5)
Applications
Changes of consolidation perimeter, foreign currency exchange rate difference
and transfers
Reclassification to assets held for sale (Note 28)
Closing balance
OTHER RECEIVABLES
FY 2015
FY 2014
FY 2015
FY 2014
12,449,720
28,754,831
5,374,243
7,556,749
3,992
739,302
592,161
3,138,367
(2,520,687)
(265,273)
(40,113)
-
-
(5,888,082)
(2,047,201)
(3,516,126)
87,147
(158,690)
2,015,089
1,373,206
-
(10,585,227)
-
(43,578)
10,755,481
12,449,720
8,440,384
5,374,243
The increase in impairments under ‘Other receivables’ is related to the impairment registered in Martifer Renewables Brasil
Participações Ltda., in 3,137,742 euros, related with the retained credit on Martifer - Construções Metálicas, Ltda. With the sale of
the company Martifer - Construções Metálicas, Ltda and the economic recession in Brazil, it was considered this credit will be of
difficult recovery in its total amount, and therefore the impairment was recognized.
st
On 31 December 2015 and 2016, the ageing’s of accounts receivable, before accumulated impairment losses, were as follows:
FY 2014
Trade receivables
PAST DUE
TOTAL
NOT DUE
UNTIL 90 DAYS
90 TO 180
DAYS
180 TO 360
DAYS
MORE THAN
360 DAYS
88,381,591
43,339,962
14,642,077
5,437,479
5,537,590
19,424,483
-
101,445
12,265,446
5,639,035
55,634,625
12,390,293
-
23,402
Other receivables
102,973,624
74,286,452
4,742,476
Total
203,745,508
117,626,414
19,407,955
5,437,479
TOTAL
NOT DUE
UNTIL 90 DAYS
TOTAL
NOT DUE
UNTIL 90 DAYS
Trade receivables
76,624,881
31,850,966
13,955,663
3,220,339
5,662,220
21,935,691
10,027,163
-
48,817
-
226,808
9,751,537
Other receivables
96,953,996
70,136,478
2,244,273
1,114,281
1,017,287
22,441,677
183,606,040
101,987,444
16,248,753
4,334,620
6,906,315
54,128,905
FY 2015
Total
23,944,696
PAST DUE
The Group’s credit risk exposure is attributable, primarily, to accounts receivable from its operating activities. The amounts
presented in the statement of financial position are net of accumulated impairment losses for doubtful debts, which have been
estimated by the Group based on its experience, current conditions and the economic environment.
st
On 31 December 2015, the accounts receivable recorded as ‘Doubtful trade debtors’ was considered to be totally impaired.
For the remaining outstanding balances, the Group considers that there has been no deterioration of the credit capacity of the
counterparts and, therefore, that such balances are not uncollectible.
The average collection period of the Group’s accounts receivable during 2015 was 235 days, the main factor behind this being the
current economic environment. Despite this unfavourable environment, the Group is committed to the compliance with its credit risk
policy, namely in terms of the strict selection of given credit, both in quantity and in quality, as well the respective collection.
The Board of Directors believes that the amount recorded in the caption ‘Trade and other receivables’ is very similar to its fair value,
considering, in particular, that the accounts receivables more than 180 days overdue are not expected to generate important
losses in addition to the impairment losses recorded.
The Group does not charge any interest as long as the established collection period (on average 90 days) is being respected. After
that period, interest is invoiced if contractually agreed, and in accordance with the applicable law, depending on each situation,
which tends to occur only in extreme situations.
st
On 31 December 2015 and 2014 the non-current balances with related companies, both subsidiaries and participating, refer
mainly to supplementary capital granted, bearing no interest and with no reimbursement date; the current balances with ‘associate
companies and other shareholders’ are related, mainly, with loans granted to joint ventures and associates, which bear interests at
three-month Euribor, with an added 6.75 % spread.
12
In the caption ‘Trade receivables’ not due, are included withholdings made by clients that consist in a percentage of the predefined
withholding in individual contract for each project, with a total of 13 million euros in 2015. These withholdings are opened during the
warranty period and therefore we can’t collect this amount from the client. When bank guarantees are issued on our behalf, we can
then collect the amount.
st
On 31 December 2015 and 2014, the Group does not have any held-to-maturity financial assets or ‘financial assets at fair value
through profit or loss.
25. CURRENT TAX ASSETS
st
On 31 December 2015 and 2014, ‘current tax assets’ are as follows:
FY 2015
FY 2014
Income tax
1,029,684
744,905
Value added tax
3,590,493
5,071,580
VAT requested refunds
1,545,544
633,052
736,934
2,270,341
5,872,971
7,974,973
Other taxes
Current tax assets
The value added tax in 2015, as in 2014, largely corresponds to the recoverable amount of this tax, essentially in respect of the
acquisition of turbines, in the Renewables segment (2.2 million euros). The remaining value is mainly because the activity in
Portugal in the Metallic Constructions segment is primarily for export.
In 2014, in the caption ‘Other taxes’ are reflected the values of tax over revenues (ICMS, PIS, COFINS and ISS) to pay in Brazil,
related to projects (metallic constructions segment), with the exit of the Metallic Constructions segment of the country in 2015
contributing for the reduction of this asset.
26. OTHER CURRENT ASSETS
st
On 31 December 2015 and 2014, the breakdown of the caption ‘Other current assets’ is as follows:
FY 2015
FY 2014
Accrued income:
Construction contracts
Cost
29,389,956
43,554,431
Impairment losses
(2,374,973)
(7,132,109)
Carrying amount
27,014,983
36,422,322
Interest to be received
1,474,328
97,803
Other accrued income
5,601,831
1,933,955
34,091,142
38,454,080
492,128
578,537
-
40,362
Prepayments:
Insurances
Financial expenses
Rents
164,708
32,948
Other prepayments
848,789
413,222
1,505,625
1,065,069
Other (current) financial assets
432,574
1,385,692
36,029,340
40,904,841
The gross value of accrued income in 2015 had a significant reduction mainly explained by the exit in Brazil in the Metallic
Constructions segment and by a strong reduction in Portugal and Angola.
The increase in 2015 of the caption ‘Other accrued income’ is strongly related to invoices to issue in the Metallic Constructions
segment in Portugal and in the United Kingdom.
12
st
On 31 December 2015, the caption ‘Other prepayments’ includes, essentially, the prepayments relating to specialized works, that
will be rendered / performed during 2016.
The caption ‘Other current financial assets’, in 2014, refers mainly to green certificates that the Group received for the production of
st
electricity in Romania that were still unsold on 31 December 2014.
st
On 31 December 2015 and 2014, the information regarding construction contracts in progress was as follows:
FY 2015
FY 2014
381,874,971
477,742,213
144,687,816
113,468,868
380,788,023
534,617,140
170,559,583
137,647,901
6,363,463
4,379,791
9,483,652
7,195,844
32,812,394
19,445,406
- Metallic Constructions
29,389,956
43,554,431
Total of Production not invoiced (construction contracts)
29,389,956
43,554,431
25,902,289
20,972,205
Total of Production invoiced and not yet performed (construction contracts) – Note 36
25,902,289
20,972,205
Total costs incurred with construction contracts in progress:
Costs incurred with construction contracts in progress in the year
Total revenue incurred with construction contracts in progress:
Revenue incurred with construction contracts in progress in the year:
Advanced payments received from customers of construction contracts in progress:
- Metallic Constructions (Note 32)
Retentions performed by customers in construction contracts in progress:
Guarantees provided to customers in relation to construction contracts in progress:
- Metallic Constructions (Note 38)
Accrued income and accounts receivables related with construction contracts in progress:
Deferred income and accounts payable related with construction contracts in progress:
The guarantees provided to customers, in the Metallic Constructions segment, disclosed in Note 38, include both construction
contracts in progress and finished construction contracts under warranty period. The average period of the warranty is five years.
12
st
On 31 December 2015 and 2014, the Group’s main construction contracts in progress justifying the outstanding balance of the
caption ‘Production not invoiced - construction contracts’ are as follows:
FY 2015
FY 2014
Scotland's National Arena (Martifer Construções and Martifer UK)
4,244,110
3,858,672
Baltic Arena Gdansk (Martifer Polska)
2,092,291
2,087,737
Djelfa project (Martifer Construções and Martifer RO)
1,754,608
Iter TB 03 (Martifer Construções and Martifer RO)
1,593,819
Abi Bakr Bridge (Martifer Arábia Saudita)
1,579,521
Holland Green (Martifer Alumínios UK)
1,520,816
EDP Lisbon New Corporate Headquarters (Martifer Construções and Martifer Alumínios)
1,485,864
1,193,826
Viaduc Hachef (Martifer Construções and Martifer Marrocos)
1,179,362
1,302,824
Railway Arc Bridge (Martifer RO)
915,186
C39 Hall de Pintura (Martifer Construções)
771,971
Stade de Lyon (Martifer Construções)
749,704
Park Lake Plaza (Martifer RO)
541,051
Kilamba Building (Martifer Angola)
442,019
1,787,910
5,083,578
1,479,087
Museu do Amanhã (Martifer Construções BR)
4,781,466
Marina Baía Building - Luanda (Martifer Construções)
2,822,385
Birmingham New Street - Facade and Cladding Works (Martifer UK)
1,167,143
Kasc - Supporting Towers (Martifer RO)
814,851
Viaduct Sibiu (Martifer RO)
812,019
Graneleiro Facaieni (Martifer RO)
807,454
Transcarioca (Martifer Construções BR)
789,484
Juá Station (Martifer Construções BR)
753,762
Paralimpic Centre (Martifer Construções BR)
698,376
Renault Tanger Mediterranee (Martifer Construções)
646,928
Arena da Amazônia (Martifer Construções)
606,406
The Horizon (Martifer Alumínios)
598,621
Condomínio Esso 2059 (Martifer Angola)
580,479
Salvador station (Martifer Construções BR)
564,912
1822 – Future Beer Factory (Martifer Angola)
563,990
Other
10,519,634
9,752,521
29,389,956
43,554,431
27. CASH AND CASH EQUIVALENTS
The ‘Cash and cash equivalents’ caption may be analysed as follows:
FY 2015
FY 2014
40,512,347
22,905,607
Cash and cash equivalents:
Bank deposits
Cash
37,201
75,715
40,549,549
22,981,322
’Cash and cash equivalents‘ includes cash on hand and in banks, maturing in no more than 3 months, which is subject to an
st
insignificant risk of change in value. On 31 December 2015 and 2014, no restrictions exist as to the usage of the amounts
recorded in the caption ‘Cash and cash equivalents’.
In the caption ‘Bank deposits’ are included 10.3 million euros of companies headquartered in Angola which, due to the financial
crisis in the country, are subject to restrictions on transfers to outside Angola.
12
28. ASSETS HELD FOR SALE
Martifer SGPS, SA decided in September 2014, to focus the Group’s activity in Metallic Constructions (steel structures, aluminium and
glass façades, oil & gas infrastructures and naval industry) and fulfil the active sale plan of its 55 % share of Martifer Solar. As the sale
is highly likely, Martifer Solar’s assets and liabilities were classified as “non-current assets held for sale” and “liabilities associated to
non-current assets held for sale” respectively, being Martifer Solar’s Net Profit presented as “discontinued operations’ result”.
st
The breakdown of the assets and the liabilities associated with the assets held for sale on 31 December 2015 and 2014 is as follows:
Non - current Assets
Goodwill
Intangible Assets
Tangible Assets
Investment properties
Equity investments in associates
FY 2014
63,432,611
76,182,182
1,937,729
1,906,896
986,905
1,186,599
12,157,142
17,159,333
-
4,988,563
164,419
212,610
Available for sale investments
27,008,189
20,650,754
Trade receivables and other receivables
20,066,270
29,082,551
Deferred tax assets
Current Assets
Inventories
1,111,957
994,876
84,274,731
72,083,574
5,406,698
5,165,675
Trade receivables
13,331,291
20,455,344
Other receivables
16,776,236
8,673,135
Current tax assets
4,370,790
5,645,539
Other current assets
32,298,836
26,667,415
12,090,603
5,474,923
Derivatives
277
1,543
147,707,342
148,265,754
Non-controlling interests attributable to Assets held for sale
(1,877,184)
(2,060,023)
27,325,377
26,810,844
Borrowings
20,244,415
20,562,740
444,931
607,039
Total assets held for sale
Leasing Creditors
Other creditors
1,384,069
474,964
Provisions
4,980,395
4,245,496
Current liabilities
Borrowings
Leasing Creditors
271,567
920,605
109,653,974
105,184,114
40,300,209
41,978,047
162,463
152,761
Trade payables
40,540,357
34,682,918
Other payables
18,047,134
4,169,611
2,638,853
9,005,572
7,964,958
15,144,524
Derivatives
Liabilities related to Assets held for sale
Assets net of liabilities and Non-controlling interests related to Assets held for sale
1)
FY 2015
-
50,681
136,979,351
131,994,958
12,605,175
18,330,819
Szczecin real estate projects, which stopped being an asset held for sale in 2015
st
The total value of Martifer Solar’s consolidated assets, on 31 December 2015, were 147 million euros, being the contribution to the
st
Group of 148 million euros (on 31 December 2014 it reached Euro 148 million). The value of non-current assets totals 62 million
st
euros, being the contribution to the Group 63 million euros (on 31 December 2014, reached 71 million euros).
st
Consolidated equity value of Martifer Solar on 31 December 2015 totalled 4 million euros, being the contribution to the Group
st
10.7 million euros (on 31 December 2014 Martifer Solar’s Equity reached 6 million euros). The decrease is mainly due to the
period’s net income.
12
Consolidated equity value of Martifer Solar attributable to the Group is 10.7 million euros, being the contribution to the Group
12.6 million euros.
st
The Net Debt registered on 31 December 2015 was 49 million euros, 9 million euros less than in 2014, showing the effort to
control it, in line with the Group’s current strategy.
The Szczecin real estate project started to be classified as an investment property in 2015 (Note 20).
st
The detail of the result attributable to discontinued activities on 31 December 2015 and 2014 is as follows:
Other income
FY 2015
FY 2014
127,480,781
108,307,715
14,702,994
9,858,833
Cost of goods sold
(60,945,309)
(63,664,631)
Subcontractors
(18,271,340)
(26,198,035)
External supplies and services
(43,008,541)
(28,245,447)
Staff costs
(12,585,469)
(15,742,738)
(2,525,815)
(10,092,944)
4,847,301
(25,777,247)
Other operational gains and losses
Amortizations
(2,452,495)
(2,580,503)
Provisions and Impairment losses
2,178,213
(19,893,463)
Operating income
4,573,019
(48,251,213)
Financial income
2,587,176
7,925,365
(8,926,844)
(15,947,341)
Financial expenses
Gains / (losses) on associate companies and joint arrangements
Profit before tax
(71,111)
(125,740)
(1,837,760)
(56,398,929)
Income tax
1,036,988
(8,773,051)
Net profit
(800,771)
(65,171,979)
192,574
(34,428,519)
(993,345)
(30,743,460)
Attributable:
owners of Martifer
As referred in the Management Report, revenues in 2015 registered a sharp increase justified, mainly, by a 57 MW EPC project
under construction in Jordan and by the final stage of construction of projects in the United Kingdom.
The caption ‘Other operating income’ includes the gains on the sale of the Tongue project in the United Kingdom (2.5 million euros),
the income from the temporary loaning of the module factory (2.4 million euros) and operational capital gains (1 million euros).
The EBITDA in the end of 2015 was 4.9 million euros (-25.7 million euros in 2014), showing therefore an improvement in the overall
operational performance in the Solar segment, contrasting with the losses registered in 2014, related to the Aura Solar project in
Mexico and the respective force majeure event, as well as with the entities in the United States involved in the Chapter 11 process,
reported in the previous period. On the other hand, during 2015, the projects under construction in the United Kingdom, which
transited from 2014, were affected by adjustments in their operational margins, having a negative impact in EBITDA.
The Revenues of this segment continue focused in the external market, with highlight to Jordan, as previously stated.
It is also important to refer that the EBIT in 2015 includes a partial reversion (around 3.8 million euros) of the impairment registered
in 2014 in the investment in FTP Power (USA).
The Net Financial Results in 2015 reached 6.4 million euros (in 2014 were 8.1 million euros, registering an improvement compared
with the previous period, despite the registration of high financial expenses, namely in bank commissions in various projects and
bank fees by SBLC’s (collateral to lines of credit).
12
st
Detailed cash flows of discontinued activities on 31 December 2015 and 2014 is as follows:
FY 2015
FY 2014
Net cash generated by operating activities
11,175,384
(2,927,493)
Net cash generated by investing activities
1,222,829
561,140
Net cash generated by financing activities
(5,082,561)
(8,006,184)
Net increase in cash and cash equivalents (4) = (1) + (2) + (3)
7,315,652
(10,372,537)
Changes in the consolidation perimeter and others
(662,909)
320,089
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents at the end of the period
(37,063)
109,642
5,474,923
15,417,730
12,090,603
5,474,923
29. SHARE CAPITAL, RESERVES, TREASURY SHARES AND NONCONTROLLING INTERESTS
Share capital and treasury shares
st
Martifer SGPS’ share capital, fully subscribed and paid up on 31 December 2015 and 2014 amounts to 50,000,000 euros and is
represented by 100,000,000 bearer shares with a nominal value of Euro 50 cents each. All shares have the same rights,
corresponding to one vote per share. During 2015 and 2014, no changes occurred in the number of shares of the Group.
During 2015, Martifer SGPS did not acquire treasury shares on the stock exchange. Martifer holds 2,215,910 own treasury shares,
corresponding to 2.22 % of its share capital.
st
On 31 December 2015, the share capital of the company was held as follows: 42.4 % by I’M SGPS, S.A., 0.65 % by two board
members related to I’M SGPS, S.A., 37.5 % by Mota-Engil SGPS, S.A., 2.22 % are treasury shares, and the remaining 17.23 %
represent free-float listed on Euronext Lisbon.
Share premium
The share premium corresponds to additional amounts obtained with the issuance of share capital increases. In accordance with
the Portuguese commercial legislation, the amounts included in this caption follow the regime established for the ‘Legal reserve’,
and consequently, they are non-distributable, except in the event of the liquidation of the company. However, they may be used to
absorb losses, after all the other reserves are exhausted, or to increase share capital.
Reserves
Legal reserve
Portuguese commercial legislation requires that at least 5 % of the annual net profit be appropriated to a legal reserve, until such
reserve attains at least 20 % of the share capital. This reserve is non-distributable, except in the event of the liquidation of the
company. However, it may be used to absorb losses, after all the other reserves are exhausted, or to increase share capital.
This reserve is included in the caption ‘Other reserves’ and amounts to 7,696,844 euros.
Own treasury shares
The Group holds 2,215,910 own treasury shares, corresponding to 2.22 % of its share capital. In accordance with the Portuguese
legislation, it is mandatory to keep non-distributable reserves in the amount of own treasury shares, included in ‘Other Reserves’.
Fair value reserves – Cash flow hedge derivatives
‘Fair value reserves – Cash flow hedge derivatives’ reflect the fair value changes in the cash flow hedges considered effective and
cannot be distributed to shareholders nor used to absorb losses.
Foreign currency translation reserves
12
Foreign currency translation reserves reflect the foreign currency exchange differences arising from: (i) translation of foreign
operations; (ii) net investment in subsidiaries and (iii) goodwill. These reserves cannot be distributed to shareholders nor used to
absorb losses, being transferred to the income statement when the affiliates are sold or liquidated.
Other reserves
In addition to the legal reserve, totalling 7,696,844 euros, this caption includes the results of prior years and a non-distributable
reserve in the amount of 2,868,519 euros relating to the value of the treasury shares.
In accordance with the Portuguese legislation, the amount of the distributable reserves is determined taking into consideration the
individual financial statements of Martifer, SGPS, SA, which has been prepared in accordance with IFRS.
st
On 31 December 2015 Martifer, SGPS, SA does not have distributable reserves.
The detail in the main non-controlling interests are as follows:
FY 2015
Opening balance
FY 2014
(24,942,297)
39,676,431
1,654,786
(43,166,602)
Other changes in equity of subsidiaries
(1,510,281)
(5,154,704)
(4,072,288)
(4,230,209)
(2)
(9,006,587)
Net profit of the year
Transactions with non-controlling interests
Other
From continued operations
From which attributable to non-current assets held for sale (Note 28)
492,877
(3,060,626)
(28,377,206)
(24,942,297)
(26,500,022)
(22,882,274)
(1,877,184)
(2,060,023)
In 2015, the main impacts that justify the reduction in non-controlling interests, despite the positive net profit for the period, mainly
result from changes in the consolidation perimeter with the corporate restructuring that occurred in the Group in 2015 (Note 2), in
which the companies in the Metallic Constructions segment are all below Martifer Metallic Constructions SGPS, S.A. (75 % owned
by the Group, as well as Martifer Inovação e Gestão, S.A.. ‘Other changes in equity of subsidiaries’ also have a negative impact
that results mainly from the exchange devaluation in some geographies.
st
Non controlling interests on 31 December 2015 reflect, besides the result defined: i) the impact of decrease in participation in
Martifer Metallic Constructions, SGPS, SA, owned by Martifer, SGPS, SA at 75 %, following the equity increase (28 million euros) in
this company by the new shareholder Vector Diálogo, SGPS, SA; ii) the impact of the sale of Rosa dos Ventos in the RE Developer
segment; iii) the impact of deconsolidation of Martifer Solar USA and Martifer Aurora Solar LLC, following the loss of control (Note
2); iv) the distribution of dividends in the RE Developer segment (12 million euros) to a minority shareholder for a value different
from its capital share; and v) the classification of Martifer Solar as a non-current asset held for sale (Note 28).
12
% NON-CONTROLLING INTERESTS
FY 2015
FY 2014
40.94%
1,896,945
2,053,776
25.00%
679,350
785,888
25.00%
25.00%
(2,377,785)
(3,244,930)
Martifer Constructions, SAS
25.00%
25.00%
(740,897)
(249,529)
Martifer UK Limited
25.00%
25.00%
(1,129,597)
(1,339,662)
Martifer Polska Sp. Zo.o.
25.00%
25.00%
(2,425,379)
(2,467,012)
Martifer Konstrukcje Sp. z o.o.
25.00%
25.00%
(703,071)
(786,160)
Martifer - Construções Metalomecânicas, S.A.
25.00%
20.83%
(13,511,006)
(7,132,255)
Martifer - Alumínios, S.A.
25.00%
25.00%
-
(5,962,520)
25.00%
25.00%
(2,246,586)
(2,217,060)
Gebox, S.A.
25.00%
0.00%
(631,599)
-
Navalria – Docas, Construções e Reparações Navais, S.A.
25.00%
0.00%
(1,986,184)
-
Martifer Metallic Constructions SGPS, S.A.
25.00%
25.00%
(6,066,752)
(3,664,488)
Martifer Energy Systems SGPS, S.A.
25.00%
0.00%
9,105,814
-
Martifer Constructii S.R.L.
24.50%
25.00%
(3,330,460)
(3,184,647)
Martifer Energia S.R.L.
25.00%
0.00%
(765,987)
-
Martifer Wind Energy Systems LLC
25.00%
0.00%
(2,812,541)
-
West Sea-Estaleiros Navais,Lda
25.00%
0.00%
394,080
-
45.00%
45.00%
435,801
827,794
(1,877,184)
(2,060,023)
(284,169)
3,698,530
(28,377,206)
(24,942,297)
FY 2015
FY 2014
Martifer – Construções Metálicas Angola, S.A.
40.94%
Martifer Alumínios Angola, S.A.
25.00%
Martifer Aluminium Pty, Ltd
Renewables
Martifer Renováveis - Geração de Energia e Participações S.A.
Other
Non controlling interests associated to non-current assets held for sale (note 28)
Other non controlling interests
30. BORROWINGS
st
On 31 December 2015 and 2014, borrowings may be analysed as follows:
FY 2014
UNTIL 1 YEAR
BETWEEN 1 AND 3 YEARS
MORE THAN 5 YEARS
TOTAL
Bank loans
14,448,560
33,760,563
88,624,207
71,088,200
207,921,530
Bank overdrafts
13,458,228
-
812,636
1,784,259
16,055,123
Authorized overdrafts
24,238,327
205,556
3,498,822
12,045,122
39,987,827
Financial institutions borrowings:
Other borrowings:
Commercial paper
5,000,000
-
-
-
5,000,000
Other borrowings
16,499,977
723,155
999,962
1,995,989
20,219,083
73,645,092
34,689,274
93,935,627
86,913,570
289,183,563
UNTIL 1 YEAR
MORE THAN 5 YEARS
TOTAL
Bank loans
7,451,983
9,356,708
168,303,524
93,389,981
278,502,196
Bank overdrafts
1,036,155
-
-
-
1,036,155
4,763,520
-
-
-
4,763,520
-
-
-
-
-
FY 2015
Other borrowings:
Commercial paper
Other borrowings
576,867
800,119
568,394
3,400,124
5,345,504
13,828,525
10,156,827
168,871,918
96,790,105
289,647,376
12
st
On 31 December 2015, the Group’s net debt was 260,290,867 euros. The net debt calculation includes, besides the borrowings
mentioned above, ‘finance leases’, ‘derivatives’ and ‘cash and cash equivalents’. This amount corresponds to an 8 % reduction
when compared with the last year, in line with the decreasing of the Martifer Group’s debt has been presenting over the last years
and in result of a debt reduction policy.
This variation is influenced by the financial debt restructuring agreements signed between Martifer and the financial credit
institutions at the end of 2015.
Following this debt reduction policy, Martifer Group will continue, in 2016, the process of sale of non-core assets: Solar segment,
wind farms and, residually, real estate projects.
The financial debt restructuring agreement also allowed the adequacy of the inflows maturity of the operational activity and
investment (divestment) to the outflows of the financing activity, through the rescheduling of the maturity over time, increasing the
average debt maturity to make it more coincident with the degree of permanence of its long term assets and a maturity that allows
st
the cash surpluses to be sufficient to comply with its responsibilities. Therefore, on 31 December 2015, the average debt maturity
was around 8 years.
Other borrowings
The amount of ‘Other borrowings’ includes 2.7 million euros in obligations under finance leases (related to the financing of the real
estate projects recorded as ‘Work in progress’ – Note 19) which, in the event of the sale of the referred projects, will be settled at
that moment and not in accordance with the established reimbursement plan, which contractually occurs after 2015.
This caption also includes 1.2 million euros from a payment to a suppliers’ grouped credit line.
The caption ‘Other borrowings’ also includes the loans obtained from the Portuguese Agency for Foreign Investment and
Commerce (Agência para o Investimento e Comércio Externo de Portugal - AICEP), Institute for Support to Medium and Small
Companies and to Investment (Instituto de Apoio às Pequenas e Médias Empresas e ao Investimento - IAPMEI), as support for the
investment carried out by the Group amounting 2.2 million euros.
st
On 31 December 2014 and 2013, the outstanding borrowings are denominated in the following currencies:
FY 2014
FINANCIAL INSTITUTIONS
OTHER BORROWINGS
TOTAL
Real
302,991
5,534,794
5,837,785
Euro
246,438,425
19,684,289
266,122,714
14,171,179
-
14,171,179
3,051,885
-
3,051,885
263,964,480
25,219,083
289,183,564
FINANCIAL INSTITUTIONS
OTHER BORROWINGS
TOTAL
New Leu
American Dollar
FY 2015
Kwanza
Euro
New Leu
American Dollar
1,310,567
-
1,310,567
265,923,649
5,345,505
271,269,154
13,604,901
-
13,604,901
3,462,757
-
3,462,757
284,301,874
5,345,505
289,647,378
The average interest rates of the bank overdrafts and the borrowings are as follows:
FY 2014
AVERAGE RATES
RANGE OF INTEREST RATES (%)
Bank loans
5.51%
[3.00% to 23.00%]
Bank overdrafts
4.32%
[3.02% to 6.46%]
5.68%
[4.73% to 6.46%]
Other borrowings:
Commercial paper
6.38%
[6.38%]
Other borrowings
10.30%
[0.00% to 25.34%]
12
FY 2015
AVERAGE RATES
RANGE OF INTEREST RATES (%)
Bank loans
1.82%
[0.96% to 6.77%]
Bank overdrafts
3.13%
[3.00% to 3.21%]
6.45%
[4.07% to 12.50%]
1.71%
[0.00% to 4.00%]
Other borrowings:
Commercial paper
Other borrowings
The average interest rates on borrowings, by geography, are as follows:
COUNTRY
INDEX
SPREAD
Spain
Euribor
[3.5 to 6.50]
Libor
Portugal
[1.00 to 4.50]
Euribor
Romania
Robor
[2.50 to 3.75]
Currently, more than 90 % of the debt is subject to floating rate.
As a consequence of the signature of the restructuring agreement, there is a strong reduction in the loans’ spreads. This factor,
together with the ongoing decreasing trend in the indexes, translated into a reduction in debt cost.
st
On 31 December 2015, the main bank borrowings of the Group are as follows:
CONTRACT
CURRENCY
VALUE
(EURO)
CONTRACT
DATE
GRACE PERIOD
OF CAPITAL
INSTALMENT
PAYMENTS
FIRST
INSTALMENT
AMOUNT
LAST
INSTALMENT
AMOUNT
Martifer SGPS, S.A. [PT]
Metalomecânicas, S.A. [PT]
Gebox, S.A. [PT]
Martifer Metallic Constructions SGPS,
S.A. [PT]
[PT]
EUR
26,250,000
31-12-2020
1,640,625
6,820,164
2,150,000
31-03-2025
Quarterly
32,673
587,887
EUR
1,500,000
31-03-2025
Quarterly
-
410,139
EUR
6,500,000
31-03-2025
4 Months + 4
Years
4 Months + 4
Years
1 + 4 Years
Quarterly
EUR
Quarterly
325,000
969,510
EUR
20,000,000
31-03-2025
2 + 4 Years
Quarterly
1,250,000
7,584,363
EUR
5,250,000
31-03-2025
1,5 + 4 Years
Quarterly
76,924
1,016,312
Martifer Inovação e Gestão, S.A. [PT]
EUR
1,368,924
15-08-2025
3 Years + 5
Years
Quarterly
206,944
264,351
EUR
1,200,179
01-02-2018
5 Years
Quarterly
25,004
75,011
COMPANY
Reparações Navais, S.A. [PT]
EUR
1,086,466
09-04-2016
-
Quarterly
42,552
188,687
EUR
15,000,000
31-12-2020
-
Quarterly
10,250,000
4,992,127
EUR
1,900,000
31-12-2020
-
1,924,346
5,000,000
31-03-2025
Quarterly
-
2,329,169
EUR
7,500,000
31-12-2020
Quarterly
-
8,012,163
EUR
2,500,000
31-03-2025
1 Quarter + 4
Years
2 Years + 3
Years
Quarterly
EUR
Quarterly
-
1,056,919
EUR
851,052
31-03-2025
5 Years
Quarterly
-
395,739
EUR
5,000,000
31-12-2020
-
Quarterly
-
5,092,361
EUR
50,000,000
31-12-2020
-
Quarterly
-
50,923,408
EUR
20,000,000
31-12-2020
-
Quarterly
-
20,369,363
S.A. [PT]
S.A. [PT]
S.A. [PT]
EUR
8,000,000
31-12-2020
-
Quarterly
-
8,147,745
EUR
14,000,000
31-03-2025
5 Years
Quarterly
-
6,592,042
EUR
2,500,000
31-03-2025
4 Years
Quarterly
-
1,167,433
EUR
2,500,000
31-12-2020
-
Quarterly
-
2,536,378
EUR
2,600,000
31-03-2025
4 Years
Quarterly
-
1,209,710
EUR
29,347,440
31-12-2019
-
Quarterly
-
2,274,427
EUR
59,922
31-03-2025
3 Years
Quarterly
-
27,864
12
COMPANY
Promoquatro – Investimentos
Imobiliários, Lda. [PT]
[PT]
Gebox, S.A. [PT]
S.A. [PT]
Martifer Renewables Investments
ETVE, S.L.
Martifer Renewables ETVE, S.A.U. [ES]
CONTRACT
CURRENCY
VALUE
(EURO)
CONTRACT
DATE
GRACE PERIOD
OF CAPITAL
INSTALMENT
PAYMENTS
FIRST
INSTALMENT
AMOUNT
LAST
INSTALMENT
AMOUNT
EUR
3,244,218
31-03-2025
4 Years
Quarterly
-
1,508,562
EUR
113,172
31-03-2025
3 Years
Quarterly
-
52,625
EUR
513,233
31-03-2025
3 Years
Quarterly
-
238,653
EUR
5,101,563
31-12-2020
-
Quarterly
-
5,101,563
EUR
16,254,302
31-12-2020
-
Quarterly
-
16,433,645
EUR
2,035,204
31-03-2025
4 Years
Quarterly
-
946,370
EUR
3,048,379
31-03-2025
4 Years
Quarterly
-
1,417,496
EUR
254,032
31-03-2025
4 Years
Quarterly
-
118,125
EUR
1,624,246
31-03-2025
4 Years
Quarterly
-
755,274
EUR
310,155
31-03-2025
4 Years
Quarterly
-
144,222
EUR
1,016,422
31-03-2025
4 Years
Quarterly
-
472,636
EUR
1,016,126
31-03-2025
4 Years
Quarterly
-
472,499
EUR
3,299,532
31-03-2025
4 Years
Quarterly
-
1,534,282
EUR
4,318,537
31-03-2025
4 Years
Quarterly
-
2,008,120
EUR
3,299,468
31-03-2025
4 Years
Quarterly
-
1,534,253
EUR
3,048,645
31-03-2025
4 Years
Quarterly
-
1,417,620
EUR
351,719
31-03-2025
4 Years
Quarterly
-
163,549
EUR
11,500,000
12-06-2016
-
Quarterly
718,750
722,500
EUR
28,556,250
26-05-2027
2 Years
Quarterly
700,000
600,000
INSTALMENT
PAYMENTS
FIRST
INSTALMENT
AMOUNT
LAST
INSTALMENT
AMOUNT
1,491,680
1,188,122
st
On 31 December 2015, the main Project Finance obtained by the Group are as follows:
COMPANY
Eviva Nalbant, srl_RO
CONTRAC
T
CURRENCY
VALUE
(EUROS)
CONTRAC
T DATE
PERIOD
GRACE PERIOD OF
CAPITAL
RON
17,907,317
Apr-11
13
Years
2 Years + 1 Half
Half-yearly
This amount is presented in the caption ‘Bank loans’.
st
On 31 December 2015 the Group had no commercial paper programmes.
st
On 31 December 2015, the Group’s interest rate sensitivity analysis may be summarized as follows:
ESTIMATED IMPACT 2015
Change in financial results due to a 1 p.p. alteration of the interest rate applied to the entire debt
Fixed-rate hedging
2,896,474
36,630
Interest rate derivatives instruments hedging
-
Sensitivity of the financial results due to interest rate changes
2,859,844
For this financing, the guarantees indicated on note 38 were provided.
12
31. OBLIGATION UNDER FINANCIAL LEASES
st
On 31 December 2015, the major finance lease contracts were as follows:
CONTRACT
AMOUNT
PURCHASE
PERIOD
PURCHASE OPTION
AMOUNT
ASSET DESCRIPTION
PERIOD
GUARANTEES
Wind energy converters
144 months
18,205,554 End of contract
364,111
Blank promissory note
Energy converters
144 months
180,158
Mobile metallic structure
210 months
924,699
Building Units A, B, C, D, E, F, G, H, I, J, L, M and N in
Benavente Business Centre
164 months
2,234,287
Martifer’s Fixed machinery
210 months
626,246
Mobile metallic structure
202 months
323,786
Various pieces of equipment
97 months
101,811
Urban building
217 months
53,130
Various pieces of equipment (stripping camera, cutting
table, Calandra)
190 months
113,174
Martifer’s Fixed machinery
210 months
117,546
Cutting table and stripping robot
95 months
963,200 End of contract
19,264
Rural building
159 months
21,100
Ventilation system
60 months
47,014
Gebox Land - Vagos 2 parcels (articles n. 2874 and 2896)
182 months
47,284
End of contract
1,946
Promissory note guaranteed
by Motofil and Martifer SGPS
Building
120 months
37,906
End of contract
5,472
Building
Ford Mondeo Station Diesel
159 months
24,975
End of contract
2,237
Ventilator
60 months
24,674
End of contract
4,694
Blank promissory note, and
guarantee of MMC SGPS
st
On 31 December 2015 and 2014, obligations under finance leases contracts were as follows:
MINIMUM LEASE PAYMENTS
PRESENT VALUE OF MINIMUM LEASE PAYMENTS
FY 2015
FY 2014
FY 2015
FY 2014
No more than 1 year
1,154,414
3,071,572
988,858
2,481,603
More than 1 year and less than 5 years
1,735,462
9,744,719
1,098,476
8,217,999
More than 5 years
9,805,627
6,363,406
9,136,820
5,612,714
12,695,503
19,179,698
11,224,154
16,312,316
Future finance charges
(1,471,349)
(2,867,382)
Present value of minimum lease payments
11,224,154
16,312,316
11,224,154
16,312,316
Included in the financial statements as:
- Current borrowings
- Non-current borrowings
1,154,414
3,071,572
988,858
2,481,603
10,069,740
13,240,743
10,235,296
13,830,713
11,224,154
16,312,316
11,224,154
16,312,316
The value of assets under financial leases is presented in Note 19.
st
Additionally, on 31 December 2015 and 2014, rentals associated with operational lease contracts are as follows:
FY 2015
FY 2014
No more than 1 year
200,343
1,485,827
More than 1 year and less than 5 years
282,159
133,649
-
105,134
482,502
1,724,610
More than 5 years
st
On 31 December 2015 the caption ‘External supplies and services’ includes the amount of 1,206,738 euros, relating to operational
lease rentals.
12
32. TRADE PAYABLES AND OTHER PAYABLES
st
On 31 December 2015 and 2014, trade payables and other payables may be analysed as follows:
NON CURRENT
Trade payables
CURRENT
FY 2015
FY 2014
FY 2015
FY 2014
11,578,310
11,522,691
61,211,154
63,638,919
-
-
1,284,903
791,014
7,263
7,247
989,946
924,734
81,490
-
7,495,466
19,217,883
-
851,292
6,779,928
6,245,633
88,753
858,539
16,550,243
27,179,264
11,667,063
12,381,230
77,761,397
90,818,183
Other creditors
Fixed assets suppliers
Related companies and other shareholders
Advanced payments received from customers (Note 26)
Other creditors
Other payables
Total
The balance of non-current ‘Trade payables’ is primarily related with retentions on work performed by external parties, which will be
released at the end of the guarantee period. These amounts bear no interest.
st
On 31 December 2015 and 2014, this caption includes balances payable to suppliers resulting from the Group’s operating
activities, as well as from tangible and intangible asset acquisitions. The Board of Directors believes that the carrying amount of
these balances is very similar to their fair value and that the effect of the financial discounting of these amounts is not material. The
reduction of advances from clients justifies the significant reduction in 2015.
st
On 31 December 2015 and 2014, the ageing of accounts payable in the captions ’Trade payables’ and ‘Other payables’ was as follows:
PAST DUE
FY 2014
TOTAL
NOT DUE
UNTIL 90 DAYS
90 TO 180
DAYS
Trade payables
75,161,610
39,439,880
9,983,147
7,006,362
7,771,345
Other payables
28,037,803
5,361,532
8,325,045
1,206,744
5,091,078
8,053,404
103,199,413
44,801,412
18,308,192
8,213,106
12,862,423
19,014,280
180 TO 360
DAYS
MORE THAN
360 DAYS
8,375,063
Total
180 TO 360
DAYS
MORE THAN
360 DAYS
10,960,876
PAST DUE
FY 2015
TOTAL
NOT DUE
UNTIL 90 DAYS
90 TO 180
DAYS
Trade payables
72,789,464
37,690,824
16,168,175
5,373,877
5,181,525
Other payables
16,638,997
4,158,328
1,123,407
491,803
1,233,791
9,631,668
Total
89,428,459
41,849,152
17,291,582
5,865,680
6,415,316
18,006,731
The average payment period of the Group hovers around 260 days.
As happens with trade receivables (Note 24), under the caption ‘Trade Payables’ are included the withholdings to suppliers, with
exception for the ones in which the bank guarantee is issued by the supplier and not by Martifer, being these considered ‘Not due’.
Accounts payable more than 180 days overdue relate to amounts payable to trade creditors with which the Group maintains regular
commercial relations.
st
On 31 December 2015 and 2014, the balances due to ‘associate companies and to other shareholders’ relate, primarily, to loans
obtained from jointly controlled entities and associate companies, that bear interest at Euribor 3M increased by a 6.75 % spread.
Besides the financial liabilities previously disclosed and in Notes 30 and 31 above, the Group does not have any other financial
liabilities.
12
33. PROVISIONS
st
The information relating to ‘Provisions’ on 31 December 2015 and 2014 may be detailed as follows:
Quality guarantees
Provisions arising from the use of the equity method
Onerous Contracts
Contractual obligations
FY 2015
FY 2014
2,452,973
1,447,244
803,708
1,258,968
7,049,726
6,763,255
436,536
5,777,177
9,230,649
7,952,565
19,973,592
23,199,209
st
The movements occurring in the caption ‘Provisions’ during the period ended on 31 December 2015 are as follows:
CHANGE OF CONSOLIDATION
PERIMETER, EXCHANGE RATE
DIFFERENCES, TRANSFERS
CLOSING
BALANCE
-
898,108
2,452,973
(150,000)
(269,691)
803,708
-
71,470
7,049,726
(4,038,972)
-
(1,301,669)
436,536
(54,307)
(12,821)
49,202
9,230,649
(4,570,445)
(162,821)
(552,580)
19,973,592
OPENING
BALANCE
ADDITIONS
REDUCTIONS
Quality guarantees
1,447,244
232,584
(124,964)
1,258,968
254,020
(289,590)
Provisions arising from the use of the
equity method
6,763,255
277,613
(62,612)
Onerous Contracts
5,777,177
-
Other
7,952,565
1,296,011
23,199,209
2,060,228
APPLICATIONS
Quality guarantee provisions were recorded to meet potential quality problems resulting from the Group’s operating activities. On
average, quality guarantees have a 5 year limit. The provisions reflect a percentage of the construction value, which varies between
0.08 % and 0.22 %, depending on the business segment and the company. In 2015 a reclassification/transfer was made of part of
the amount registered under the caption ‘Onerous contracts’ to the caption ‘Quality guarantees’, since it is the most adequate
framing regarding the recognized obligation.
In 2014, provisions for onerous contracts concern to estimated responsibilities associated to possible contract obligations in the
operational activity of the Metallic Constructions segment, and its value was used in totality in 2015
The increase in caption ‘Other’ is related to the registration of a provision I the Metallic Constructions segment in Angola, related
with the already concluded Kanhangulo project.
As referred to in note 1, a provision for investments in associate companies which capital is negative (based on the owned
shareholding) (Note 21).
Considering the uncertainties surrounding these provisions, as well as their nature, the Group did not financially discount these amounts.
34. CONTINGENT LIABILITIES
st
On 31 December 2015, the contingent liabilities are as follows:
a)
th
On 29 October 2009, Martifer Polska, in consortium with ‘Ocekon Engineering s.r.o.’ (Slovakia), concluded with
Energomontaz – Południe S.A. an agreement for Works, whose object was the manufacture, execution, delivery and
installation of the steel roof on the Baltic Arena Stadium in Gdańsk (Poland), in the approximate amount of 11.3 million euros.
nd
On 2 September 2010, Martifer received a notice of the immediate termination of the agreement from Energomontaz –
Południe S.A., without any prior warning. The main reason alleged for the termination were delays in the execution, which, in
th
Martifer’s opinion, was totally unfounded and ultimately ineffective. On 17 December 2010, Martifer lodged an official lawsuit
in the Court in Katowice, against Energomontaz. The amount of the lawsuit was approximately 12.6 million euros, including
th
interest, the cost of the capital involved and the damages caused to Martifer by the lack of cooperation. On 17 January 2012,
Energomontaz - Południe SA lodged its legal suit against Martifer, involving 5.7 million euros. Court hearings are in progress
12
and Martifer Group has recognized in its financial statements impairment losses relating to the account receivable, production
not invoiced and the executed bank guarantee; therefore it considers that this litigation risk is adequately covered in its
financial statements. Meanwhile, the company Energomontaz has entered a bankruptcy process. In April 2013, Martifer
submitted the list of claims, totalling 16.9 million euros, to the insolvency administrator. To date, there is no information on the
list of credits of the insolvency estate.
st
b)
Martifer signed, on 1 August 2014, an investment agreement denominated “Agreement”, related with a 30 million euros
investment in Nutre, SGPS, SA to be performed by a company to be owned in 80 % by Ceres Investment, and within which,
depending on certain conditions, Martifer sells its 49 % share held in Nutre, SGPS, SA’s share capital.
th
The closing of the transaction occurred on 19 December 2014, when 50 % of the investment was executed by Ceres
Investments. However, all documentation related to the investment and transfer of shares was in custody of a Notary until the
date Ceres Investments executes the remaining investment, of 15 million euros, which occurred in January 2015.
According to the investment agreement mentioned above, Martifer SGPS, SA is responsible, in proportion to the sold share,
for the payment of compensations to third parties due by Nutre SGPS SA or any of its subsidiaries, in case they are condemned
and the amount of compensation exceeds an accumulated total of 500,000 euros, with a maximum of 14.7 million euros, by
facts that occurred before the date of the investment agreement, and on a 3 year period after the closing of the operation.
After this closing, the company Koninklijke Bunge B.V. lodged an arbitration procedure against Nutre Farming B.V.
(subsidiary of Nutre SGPS, S.A.), in which the companies Koninklijke Bunge B.V (“Bunge”) e Bunge Prio Coöperatief U.A.
claim from Nutre Farming B.V. a total of 22,711,607 Romanian Leus and 19,558,282 euros. In its turn, Nutre, in counterclaim,
claims from Bunge the amount of 13,839,700 euros for itself and 19,747,265 euros for Bunge Prio Coöperatief U.A.. The trial
hearings were concluded in March 2016, with an expected ruling by the Arbitration Court in April 2016.
To date, Martifer SGPS SA was not notified of any occurrence from which may surge the obligation to compensate the
acquirer of its share on Nutre SGPS, SA, as indicated above.
c)
The Romanian subsidiary, Martifer Constructii, acquired, on 9 March 2007, a plot of land in Aricesti, Prahova province, in
Romania, for approximately 8.2 million RON. The referred acquisition is under a judicial dispute, currently pending judicial
action, with its terms running under appeal, being expected one of two outcomes:
1.
The Court rules a decision under which the land is maintained in property of the Romanian State, initial owner, in which
Martifer Constructii shall have the right to an indemnity, at least, at an equivalent amount of the price paid on the land
when it was acquired
2.
The Court rules a decision under which the land transits to Martifer Constructii assets, with Martifer Constructii
acquitting the totality of the rights of the land.
According to the developments on the current judicial action, Martifer considers as most probable the happening of the
scenario presented on 1), with a high probability of recovery of the amount paid when the land was acquired.
th
The Group's expectation is that no losses will occur with these processes over and above the ones already recognized in its
financial statements.
35. CURRENT TAX LIABILITIES
st
On 31 December 2015 and 2014 ‘Current tax liabilities’ are as follows:
FY 2015
FY 2014
Income tax
2,257,208
1,258,326
Value added tax
1,439,583
2,145,790
Social security contributions
709,971
3,678,660
Withholding tax
226,385
249,716
Other taxes
596,138
2,921,181
2,972,076
8,995,347
The caption ‘Other taxes’ registered a significant reduction mainly due to the exit of the Metallic Constructions segment from Brazil.
12
36. OTHER CURRENT LIABILITIES
st
On 31 December 2015 and 2014, other current liabilities are as follows:
FY 2015
FY 2014
Holiday pay and bonuses
4,128,940
5,000,578
Interest borne but not yet overdue
2,998,531
5,274,578
11,359
1,304,965
Accrued expenses
Production performed by third parties not yet invoiced
Other accrued expenses
3,266,105
2,941,373
10,404,935
14,521,494
25,902,289
20,972,205
Deferred income
Production invoiced and not yet performed (related to construction contracts)
Subsidies / Government grants
Other deferred income
636,062
688,811
4,616,714
5,908,955
31,155,065
27,569,971
41,559,999
42,091,465
st
The ‘Other accrued expenses’, on 31 December 2015, relate to the supplies and external services rendered in 2015 not yet
invoiced.
The ‘Interest borne but not yet overdue’ suffered a significant reduction due to the restructuring process that occurred in 2015.
The increase in ‘Production invoiced and not yet performed’ is mainly related to the Metallic Constructions segment in Saudi Araba
and in the shipbuilding area in Portugal.
‘Other deferred income’ in 2015, as in 2014, is mainly the result of the recognition of a deferred income with the attribution of green
certificates in Eviva Nalbant S.R.L.
12
st
On 31 December 2015 and 2014, the Group’s main construction contracts in progress justifying the outstanding balance of the
caption ‘Production invoiced and not yet performed (related to construction contracts)’ are as follows:
FY 2015
FY 2014
OPVs (West Sea)
3,018,986
-
Future Beer Factory (Martifer Angola)
2,505,873
-
Dammam University Multipurpose Hall (Martifer Arábia Saudita)
1,920,587
-
Sodiba - Supply (Martifer Construções)
1,706,526
-
Stadium Steel Structure - Erection (Martifer Arábia Saudita)
1,730,595
1,416,418
Scenic River Cruiser (West Sea)
1,576,344
1,274,870
KAFD Parcel (Martifer Alumínios)
1,330,989
2,215,903
ITER Building 13 (Martifer Construções França)
838,512
-
Shopping Nova Vida Kero (Martifer Angola)
754,201
-
Holland Green (Martifer Alumínios)
820,000
-
KAPSARC – King Abdullah Petroleum Studies and Research Center (Martifer Arábia Saudita)
763,361
-
Âncora Project (Martifer Construções)
746,688
2,039,363
C39 Painting Hall (Martifer Construções França)
728,413
-
Birmingham New Street - Facade and Cladding Works (Martifer UK)
699,157
-
Viking Osfrid (West Sea)
651,659
-
Estación Bello Monte- Tramo PZA Venezuela- Miranda II (Martifer Construções)
648,508
-
375 KHS (Martifer Alumínios)
635,533
-
Hotel Tivoli Estoril Residence (Martifer Alumínios)
528,901
534,278
Bridges 1-6 Trinidad (Martifer RO)
319,722
532,978
44,380
610,829
8,602
885,383
Sambiente Project (Martifer Angola)
-
997,646
Halls- Centro Olímpico (Martifer Construções BR)
-
866,374
Martifer-Amal_Mozambique Factory (Martifer Construções)
-
750,930
Grand Stade de Lyon (Martifer França)
-
665,779
Building facades (Martifer Arábia Saudita)
-
567,585
Serrano Tower (Martifer Alumínios)
-
553,251
Birmingham New Street - WP3201 (Martifer Alumínios)
Kero Rocha Pinto (Martifer Angola)
Loures Business Park (Martifer Construções)
Other
-
515,627
3,924,751
6,544,991
25,902,289
20,972,205
37. DERIVATIVES
The Group uses derivatives to manage its exposure to interest rate risk so as to reduce the Group’s exposure to variable interest
st
rates on its financing contracts, thereby fixing interest rates. On 31 December 2015 and 2014, the derivative contracts in place
were as follows:
st
31 December 2015
DERIVATIVE
COMPANY
Flexible Forward Sell EUR Buy
USD (PUT/CALL)
Martifer Metallic
Constructions SGPS SA
Martifer Metallic
COUNTERPART
Novo Banco
FC Stone
NOCIONAL
675,000
TYPE
CLOSING
DATE
FAIR
VALUE
Fixed Exchange rate with fixed rate
at 1.14.
5-Jul-2016
27,911
Regular margin calls
3,203
31,114
12
st
31 December 2014
TYPE
FAIR
VALUE
COMPANY
COUNTERPART
EUR CALL / GBP PUT –
Sintetic Forward
Martifer Metallic
Novo Banco
1,000,000
Fixed Exchange rate EUR Call
GBP Put strike 0.8280
20-May-2015
(73,118)
EUR CALL / GBP PUT Sintetic Forward
Martifer Metallic
Novo Banco
1,000,000
Fixed Exchange rate EUR Call
GBP Put strike 0.8320
5-Jun-2015
(78,479)
Deliverable Foreign Exchange
Forward
Martifer Metallic
Martifer Metallic
Monex Europe
1,000,000
Fixed Exchange rate 0.825. Sell
GBP Buy EUR
10-Jun-2015
(68,237)
FC Stone
NOCIONAL
CLOSING
DATE
FINANCIAL INSTRUMENT
Regular margin calls
3,221
(216,614)
The fair value of the above derivative contracts has been determined by the counterparties and, as these derivatives qualify as cash flow
hedges, they have been recorded in the equity caption ‘Fair value reserves – Derivatives’ and in ‘Derivatives’, under Assets and Liabilities.
The fair value valuation of the derivatives contracted by the Group (essentially interest rate swaps) was performed by the respective
financial institutions acting as counterparties. The fair value valuation model used by the counterparties is based on the discounted
cash flows method, using the swaps par rates, listed in the Interbank market, and available on Reuters and/or Bloomberg terminals, for
the negotiated periods, which are used to calculate the forward interest rates and discount factors. The present value of the fixed cash
flows (fixed leg) and the present value of the variable cash flows (floating leg) are then calculated. From the addition of the two legs
results the NPV (Net Present Value or discounted value of the future cash flows or fair value of the derivatives).
38. COMMITMENTS
Financial Guarantees
st
On 31 December 2015 and 2014, the financial guarantees (bank guarantees and credit insurance) provided by the Group to third
parties, namely to customers whose civil works are performed by Group companies may be detailed, by currency, as follows:
FY 2015
FY 2014
Euro
64,418,579
62,776,134
Zloty
23,453
1,527,692
New Leu
74,432
582,705
US dollar
29,277,189
57,260,888
Moroccan Dirham
83,733
81,825
16,778,366
14,845,136
Real
-
5,452,876
Rupee
-
544,845
Chilean Peso
-
59,758
Jordan Dinar
65,045
-
United Arab Emirates Dirham
12,514
-
110,733,311
143,131,859
Pound Sterling
12
The breakdown by Group company is as follows:
FY 2015
FY 2014
Martifer Construções Metalomecânicas SA
34,573,154
28,049,199
Martifer Metallic Constructions SGPS
10,511,752
8,034,731
Navalria
West Sea Lda.
Martifer Alumínios SA
Martifer Construcciones Metálicas Espanha
Martifer Polska
Martifer Constructii
Eviva Hidro SRL
Sassal Aluminium PTY LTD
13,382
13,382
7,505,494
435,500
-
7,627,965
762,061
1,252,100
-
554,820
582,879
1,367,981
-
-
-
-
1,134,195
853,427
Martifer Konstrukcje
23,453
841,132
EUROCAB FV 1 SL
29,770
29,770
EUROCAB FV 8 SL
11,227
11,227
EUROCAB FV 9 SL
11,227
11,227
EUROCAB FV 10 SL
11,227
11,227
EUROCAB FV 11 SL
11,227
11,227
EUROCAB FV 12 SL
11,227
11,227
EUROCAB FV 17 SL
11,227
11,227
EUROCAB FV 18 SL
11,227
11,227
Martifer Construções SK
Martifer Construções SAS
Martifer Construções Lda. (Brasil)
Martifer SGPS
Martifer Construções Metálicas Angola S.A.
Martifer solar ME – Dubai
Martifer Solar Srl
Martifer Solar
Martifer Solar Sistemas Solares
Martifer Solar NV
Martifer Silverado Fund, LLC
Inspira Martifer Solar Lda.
Martifer Solar JO
MARTIFER SOLAR CHILE OPERACIONES [CH]
MARTIFER SOLAR UK [UK]
-
-
70,000
70,000
-
5,452,876
2,549,740
-
10,445,767
3,763,951
12,514
-
2,278,537
2,411,610
12,634,205
14,905,136
-
37,350
90,957
1,459,388
14,211,169
53,062,359
-
544,845
65,045
-
183,705
59,758
12,976,941
12,225,987
110,733,311
143,131,859
Regarding guarantees issued to customers, there are two types, addition and good execution:
Addition aim to ensure the amount delivered by the client in the beginning of the project for material purchase. The amount
advanced is defined in contract and is regularized upon invoice. The client cancels the guarantee when the totality of the
advance is deducted.
Good execution aims to guarantee the compliance with the contract (execution deadlines, quality, etc.). The expiry of this
type of guarantee is defined in contract and they are cancelled when the final acceptance of the project is issued.


st
On 31 December 2015, there were no commitments relating to import documentary credits.
12
Additionally, the most significant operating guarantees in force are as follows:
FY 2015
FY 2014
Martifer Construções SA
2,053,221
-
West Sea
1,836,026
-
Martifer Solar SA
Martifer Solar Sistemas Solares
Martifer SGPS
924,904
-
-
4,118,277
36,511,436
33,795,789
111,642,567
88,898,000
152,968,155
126,812,065
The amount of operational guarantees registered in Martifer Construções and West Sea correspond mainly to guarantees to third
parties regarding contracting of raw material supply plateaux.
In 2015, guarantees were issued by Martifer Metallic Constructions to its subsidiaries outside Portugal for the issuance of local bank
guarantees.
As EPC contracts entered into by Martifer Solar to build solar parks oblige it and / or associate companies to provide certain
guarantees, amongst which, concerning the quality of the materials and design, the photovoltaic facilities, the performance ratios
and the power output of the installed photovoltaic modules, Martifer SGPS has agreed to endow Martifer Solar and / or its associate
companies with the necessary means to fully comply with these contractual obligations. Martifer Solar is presently considered to
have the capacity to support its own commitments, without recourse to the Holding Company.
The amount of the Martifer Solar, SA commitments relates to guarantees provided for the development and construction of solar parks.
st
Lastly, we also present the credit insurance on 31 December 2015:
CREDIT INSURANCE
Martifer Solar SA
Empresa de Energía Renovable María Sol del Norte S.A
FY 2015
26,638,192
149,589
26,787,782
No reimbursements are expected from the commitments above.
12
Pledges or Mortgages
st
On 31 December 2015 the assets pledged or mortgaged to financial institutions were as follows:
COMPANY
GUARANTEE
ASSET VALUE
DEBT AMOUNT
Share pledge of Martifer Construções SA 45 % (nr. shares 1,500,000)
3,426,137
16,310,458
5M€ Generic Mortgage of building Vale Tripeiro, lot 10 - I/J/K/L/M/N/O (Benavente)
3,082,176
5,008,967
1,286,359
3,299,468
1 degree mortgage of industrial building Cutting Unit (Monoblocos).
st
1 degree mortgage of administrative building,
nd
2 degree mortgage of industrial building Tower’s plant (article 1914)
5,658,844
3,299,532
Mortgage of industrial building Martifer Construções (article 2079)
1,137,344
Navalria SA
st
1,624,246
Martifer SGPS
1,924,346
Promoquatro Lda.
3,048,645
1st degree share pledge of 25% of Martifer Renewables SGPS (nr. Shares
25,000,000)
23,221,630
3,048,379
Promisory Loan Note Class A n. 6 pledge
Mortgage of pilot building
Mortgage of Warehouse in Alverca
Mortgage of Warehouse in Trofa
Mortgage of Land and Warehouse in Albergaria
4,500,000
2,510,610
88,701
2,601,527
148,080
70,437
Share pledge of Martifer Solar SA 55 % (nr. shares 27,500,000)
Martifer SGPS
Mortgage of building in Oliveira de Frades (article 1943) - Components’ plant Assets
pledge Martifer Construções
7,133,939
Martifer SGPS
Generic Mortgage (7.5M€) of industrial building Towers’ plant (article 1914).
8,314,077
nd
10,676,719
Martifer SGPS
2 degree share pledge of Martifer Solar SA 55 % (nr. shares 27,500,000), 1st
degree share pledge of Martifer Renewables SGPS 65 % (nr. shares 65,000,000)
71,052,955
Martifer SGPS
Mortgage of building in Oliveira de Frades (article P-2003) Unit OlF MTC
10,047,000
Martifer SGPS
Loan Note Class A n. 5 pledge
4,500,000
Martifer OF warehouse
Martifer Roménia SRL
361,646
Other Lands MGI
357,300
1st degree share pledge of Martifer Renewables SGPS (nr. shares 10,000,000)
Martifer Solar SA
9,288,652
Various equipment commercial pledge
320,688
Equipment commercial pledge
102,708
1st degree share pledge of 100% shares of the following companies: Eurocab FV 1,
S.L., Eurocab FV 2, S.L., Eurocab FV 3, S.L., Eurocab FV 4, S.L., Eurocab FV 5,
S.L., Eurocab FV 6, S.L., Eurocab FV 7, S.L., Eurocab FV 8, S.L., Eurocab FV 9,
S.L., Eurocab FV 10, S.L., Eurocab FV 11, S.L., Eurocab FV 12, S.L., Eurocab FV
13, S.L., Eurocab FV 14, S.L., Eurocab FV 15, S.L., Eurocab FV 16, S.L., Eurocab
FV 17, S.L., Eurocab FV 18, S.L., Eurocab FV 19, S.L.,
3,099,764
Share pledge of 50 % of Martifer Renovables ETVE shares
6,077,555
Mortgage of the factory
4,332,895
Mortgage of farm land and all equipment/construction included in the project/farm
Eviva Nalbant
128,428,917
95,337
Multipark Paços de Ferreira
Martifer Renovables ETVE, S.A.U.
14,176,435
1,415,300
Martifer SGPS
Martifer SGPS
1,016,126
2,035,204
Martifer Energy Systems SGPS
3,123,996
711,731
45,467,612
Share pledge of 100% of Eviva Nalbant shares
5,675,788
Pledge over all movable assets (insurance, bank accounts, accounts receivable,
intellectual property, etc.)
2,625,195
Mortgage of estate and Promisory pledge of equipment/stock
28,556,250
12,944,878
8,846,980
3,964,928
242,411,818
237,634,641
12
Regarding fixed assets acquired, attention is drawn to the following contractual commitments:
th
On 27 November was signed the renegotiation agreement of the agreement for the ‘Attribution of Energy Injection Capacity to the
National Electricity Grid for Electrical Energy produced at Wind Parks’ celebrated between Ventinveste S.A. and the Portuguese
th
Authorities (Direcção Geral de Energia e Geologia (DGEG) on 18 September 2007 was signed. This agreement allowed the
change in the society structure and the complete separation between the industrial cluster and the wind cluster. Regarding the
industrial commitments, negotiations with DGEG allowed for the exoneration of Martifer Group of all investment and job creation
obligations in the industrial cluster. It was also agreed that all the principles upon which the research financing to be determined by
the Ministry of Economy and Innovation (through the Innovation Fund) would be definitely formalized.
In 2015, following the reinforcement of guarantees foreseen in Martifer Group’s debt restructuring contract, a reinforcement of
guarantees was made with the financing banks and the holding. In this contract is foreseen that the sale of some assets will be
used for the amortization of the existent bank debt.
39. SUBSIDIES AND GOVERNMENT GRANTS
st
On 31 December 2015, investment subsidies and government grants attributed to the Group are as follows:
INVESTMENT
AMOUNT
SUBSIDIES
GRANTED
DEFERRED INCOME (NOTE 36)
AMOUNT RECORDED IN INCOME
STATEMENT
Buildings and other constructions
5,797,465
4,203,885
384,712
49,219
Basic equipment
7,832,920
2,373,768
250,973
-
89,387
89,387
-
1,113
Administrative equipment
Other Investment subsidies
61,233
53,022
377
-
13,781,005
6,720,062
636,062
50,332
st
On 31 December 2015, operational subsidies and government grants attributed to the Group recorded in the income statement
caption ‘Other gains and losses’ are as follows:
AMOUNT RECORDED IN THE INCOME
STATEMENT (NOTE 5)
COMPANY
DESIGNATION
IEFP
67,455
Navalria
IEFP
40,560
Martifer Renewables
IEFP
54
Martifer Inovação e Gestão
IEFP
2,969
Martifer SGPS
IEFP
183
West Sea
IEFP
23,455
134,676
40. RELATED PARTIES
a) Balances and transactions
Group companies have commercial relations with each other that qualify as related parties transactions. All of these transactions
are performed on an arm’s length basis.
Consequently, all these transactions are eliminated, since the consolidated financial statements disclose information regarding the
holding company and its subsidiaries as if they were a single entity.
12
The amounts of the balances and transactions with associate companies and joint-ventures, as well as with other shareholders and
shareholder-related companies, are as follows:
COSTS
Associate companies
Joint Ventures
Other related parties
REVENUES
ACCOUNTS RECEIVABLE
ACCOUNTS PAYABLE
FY 2015
FY 2014
FY 2015
FY 2014
FY 2015
FY 2014
FY 2015
FY 2014
888,055
456,641
2,542,019
1,429,223
38,829,489
5,804,058
1,106,859
458,850
-
1,965
669,203
2,749,988
2,964,722
41,745,438
270,001
942,851
807,810
3,301,725
3,166,636
2,233,316
8,680,774
4,697,138
3,347,773
3,728,268
1,695,865
3,760,331
6,377,858
6,412,527
50,474,985
52,246,634
4,724,633
5,129,969
In addition to the balances and transactions described in the tables above and below, no other balances or transactions exist with
the Group’s related parties.
st
Accounts receivable and payable vis-à-vis related parties will be cash settled and are not covered by any guarantees. On 31
December 2015 and 2014, no impairment losses were recognized in connection with accounts receivable with related parties.
b) Board of Directors and key management staff remuneration
st
On 31 December 2015 and 2014, the Board of Directors and the key management staff remuneration amounted to 589,810 euros
and 940,825 euros, respectively.
This remuneration is determined by the Remuneration Committee, taking into consideration the individual performance and the
evolution in this type of labour market.
Remuneration assigned to the Board of Directors and to key management staff, by remuneration grade, may be summarized as
follows (amounts in Euro):
Fixed remuneration
FY 2015
FY 2014
493,936
819,464
95,874
121,361
589,810
940,825
The statement on the remuneration policy applicable to the management and supervisory bodies of Martifer SGPS, approved in
accordance with Law 28/2009, as well as the total amount of the remuneration attributed to the members of these bodies,
individually and aggregated, are presented in the Corporate Governance Report.
Martifer SGPS, S.A.’s Board of Directors is constituted by:
i.
ii.
iii.
iv.
v.
vi.
Luis Valadares Tavares
41. SUBSEQUENT EVENTS
Since the reference date of the results, no facts that affect the released financial information occurred.
12
42. CASH RECEIVABLES / CASH PAYMENTS RELATED TO FINANCIAL
ASSETS
Cash receivables and cash payments related to financial assets in 2015 and 2014 were as follows:
FY 2015
FY 2014
Sale of Martifer - Construções Metálicas, Ltda.
2
-
Sale of Martifer Alumínios Ltda.
2
-
10,740,104
-
9,899
-
262,890
-
Sale of MTS3 S.R.L.
10,000
-
Sale of MTS7, S.R.L.
10,000
-
Sale of Vesto
-
80,000
Sale of Rosa dos Ventos
-
23,642,134
Sale of MTS Spittleborough Solar Limited
-
38,720
Sale of 50% of MT Solar Canada
-
26,675
Sale of MTS Francis Court
-
128
Sale of MTS Hill Farm
-
1
Sale of MTS Rydon Solar, Ltd
-
42,665
Sale of Steadfast Molland Solar
-
49,473
Sale of Gargano Solar Park s.r.l.
-
15,000
10,740,108
23,722,134
292,790
172,661
-
(272,074)
Cash Receivables:
Sale of Eviva Gizalki Sp. Zo.o
Sale of Canopy Naos
Sale of Canaverosa Renovables, SL
Receipts:
Cash Payments:
Acquisition of 100% of Solariant Portfolio GK One
Cash Payments:
-
-
-
(272,074)
43. APPROVAL OF THE FINANCIAL STATEMENTS
th
The accompanying consolidated financial statements were approved by the Board of Directors on 6 April 2016. Furthermore, the
st
attached financial statements for the period ended on 31 December 2015, are still subject to approval on the annual Shareholder’s
General Meeting. The Board of Directors believes that these will be approved with no significant changes.
12
44. EXPLANATION ADDED FOR THE TRANSLATION OF THE FINANCIAL
STATEMENTS
These financial statements are a translation of the consolidated financial statements originally issued in Portuguese, in accordance
with the International Financial Reporting Standards as adopted by the European Union. In the event of discrepancies, the
Portuguese version prevails.
th
The Registered Accountant
The Board of Directors
__________________________________
__________________________________
João Alexandre Queiroz Oliveira
(Chairman)
__________________________________
(Vice- Chairman)
__________________________________
__________________________________
__________________________________
__________________________________
12
154  2015 ANNUAL REPORT 
13
13 | INDIVIDUAL FINANCIAL STATEMENTS
INDIVIDUAL INCOME STATEMENTS FOR THE YEARS ENDED ON 31ST DECEMBER 2015
AND 2014
(TRANSLATION OF INDIVIDUAL FINANCIAL STATEMENTS ORIGINALLY ISSUED IN PORTUGUESE - NOTE 26)
CAPTION
NOTES
2
Operating subsidies
FY 2015
FY 2014
1,178,583
1,016,372
183
Supplies and external services
3
(314,344)
(381,089)
Staff costs
4
(392,872)
(589,932)
Other operating income
Other operational losses
Earnings before depreciation, financing costs and tax
Depreciation and amortization costs/reversals
Impairment on non-depreciable investments (costs/reversals)
9/10
5
Operational earnings (before financing costs and tax)
78,605
244,502
(117,844)
(23,760)
432,311
266,093
(3,789)
(8,076)
12,228,914
(119,189,472)
12,657,436
(118,931,455)
6
1,202,875
6,264,453
Interest and similar expenses
6
(3,691,241)
(9,948,345)
Gains/losses from subsidiaries, associated companies and joint ventures
11
(8,720,321)
969,707
1,448,749
(121,645,640)
Interest and similar revenue
Earnings before taxes
Corporate Income tax
7
Net income for the period
(47,508)
32,710
1,401,241
(121,612,930)
Earnings per share:
Basic
8
0,0143
(1,2437)
Diluted
8
0,0143
(1,2437)
The accompanying notes are part of these financial statements
13
INDIVIDUAL STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED ON
Caption
Net income for the year
FY 2015
FY 2014
1,401,241
(121,612,930)
1,401,241
(121,612,930)
Fair value of cash flow hedges (derivatives), net of tax
Income recognised directly in equity
Total comprehensive income for the year
 INDIVIDUAL FINANCIAL STATEMENTS  157
13
INDIVIDUAL STATEMENTS OF FINANCIAL POSITION ON 31ST DECEMBER 2015 AND 2014
CAPTION
NOTES
FY 2015
FY 2014
ASSETS
Non-current assets
10
2,794
4,749
Intangible assets
9
104
1,189
Financial Investments
11
165,549,283
160,287,373
Group companies
12
22,819,237
22,141,319
Other accounts receivable
13
Deferred tax assets
7
19,600,000
2,065,066
2,065,066
190,436,484
204,099,696
3,728,876
3,331,425
Current assets
Trade receivables
13
State and other public entities
165,972
Group companies
12
8,761,355
5,934,932
Other accounts receivable
13
21,102,357
2,296,335
11,737
12,813
Deferrals
Other financial investments
385
15
TOTAL ASSETS
290,955
598,842
33,895,665
12,340,319
224,332,149
216,440,015
EQUITY
Share capital
16
50,000,000
50,000,000
Treasury Stock
16
(2,868,519)
(2,868,519)
Share premiums
16
186,500,000
186,500,000
Legal reserves
16
7,696,844
7,696,844
Other reserves
16
2,868,519
2,868,519
Retained earnings
Net profit for the year
TOTAL EQUITY
(184,775,355)
(63,162,425)
1,401,241
(121,612,930)
60,822,730
59,421,489
LIABILITIES
Provisions
19
618,500
618,500
Borrowings
17
130,353,263
104,184,334
130,971,763
105,092,959
938,867
Other accounts payable
290,125
Current liabilities
Trade payables
18
753,338
State and other public entities
14
861,050
60,551
Group companies
12
29,804,805
25,150,567
Borrowings
17
188,686
23,343,601
18
929,777
2,431,981
32,537,656
51,925,567
TOTAL LIABILITIES
163,509,419
157,018,526
TOTAL EQUITY AND LIABILITIES
224,332,149
216,440,015
1
INDIVIDUAL STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED ON 31ST DECEMBER 2015 AND 2014
SHARE
CAPITAL
TREASURY
STOCK
SHARE
PREMIUMS
LEGAL
RESERVES
OTHER
RESERVES
RETAINED
EARNINGS
NET PROFIT FOR
THE YEAR
TOTAL EQUITY
50,000,000
(2,868,519)
186,500,000
7,696,844
2,868,519
(13,782,430)
(49,379,995)
181,034,419
(121,612,930)
(121,612,930)
Comprehensive income
(121,612,930)
(121,612,930)
DESCRIPTION
st
Balance on 1 January 2014
NOTES
Changes in the period
st
Balance on 31 December 2014
(49,379,995)
(49,379,995)
50,000,000
(2,868,519)
186,500,000
7,696,844
2,868,519
(63,162,425)
(121,612,930)
59,421,489
50,000,000
(2,868,519)
186,500,000
7,696,844
2,868,519
(63,162,425)
(121,612,930)
59,421,489
1,401,241
1,401,241
Comprehensive income
1,401,241
1,401,241
st
Balance on 1 January 2015
Changes in the period
Balance on 31st December 2015
50,000,000
(2,868,519)
186,500,000
7,696,844
2,868,519
(121,612,930)
121,612,930
(184,775,355)
1,401,241
60,822,730
 INDIVIDUAL FINANCIAL STATEMENTS 
159
13
INDIVIDUAL CASH FLOW STATEMENTS FOR THE PERIODS ENDED ON 31ST DECEMBER
2015 AND 2014
CAPTION
NOTES
FY 2015
FY 2014
OPERATING ACTIVITIES
Receipts from customers
919,207
801,644
Payments to suppliers
(477,245)
(446,761)
Payments to employees
(384,230)
(470,435)
57,732
(115,552)
544,873
(173,036)
Cash generated from operations
Income tax paid/received
Other receipts/(payments) relating to operating activities
Net cash generated by operating activities [1]
(285,156)
234,377
317,449
(54,211)
INVESTING ACTIVITIES
Tangible assets
(1,987)
(7,843)
Financial assets
(32,954,950)
(18,643,735)
Other assets
(502)
(32,957,439)
(18,651,578)
Tangible assets
13,767
3,549
Financial assets
28,870,909
23,080,260
Other assets
Interest and similar income
Net cash generated by investing activities [2]
146
1,228,013
772,834
30,112,835
23,856,643
(2,844,604)
5,204,965
68,080,151
33,668,947
68,080,151
33,668,947
(64,586,395)
(31,345,659)
FINANCING ACTIVITIES
Borrowings
Borrowings
Interest and similar costs
(1,274,488)
(8,414,780)
(65,860,883)
(39,760,439)
Net cash generated by financing activities [3]
2,219,268
(6,091,492)
Net increase in cash and cash equivalents [1+2+3]
(307,887)
(940,738)
Cash and cash equivalents at the beginning of the year
598,842
1,539,580
Cash and cash equivalents at the end of the year
290,955
598,842
Change in fair value
13
14 | NOTES TO THE INDIVIDUAL FINANCIAL STATEMENTS
INTRODUCTORY NOTE
Martifer SGPS, S.A. (“Company”) is a limited company, with its registered office at Zona Industrial, Apartado 17, Oliveira de Frades
- Portugal, incorporated on October 29, 2004 and having as its principal activities the management of shareholdings held and the
rendering of support services to the Group companies.
From June 2007, and following the successful an Initial Public Offer (IPO), Martifer SGPS, S.A. started trading on the Portuguese
Stock Exchange, Euronext Lisbon.
th
The Company is obliged, in terms of Article 4 of Regulation no. 1606/2002, of the European Parliament and Council, of 19 July, to
prepare its consolidation financial statements in conformity with the International Financial Reporting Standards (IFRS) as adopted
by the European Union in terms of Article 3 of the said regulation.
th
As allowed by decree-law no. 158/2009, from 13 July, the individual financial statements were prepares according to the
International Financial Reporting Standards.
All the amounts presented in these notes are expressed in Euro, unless otherwise indicated.
1. SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PREPARATION
These accompanying consolidated financial statements relate to the individual financial statements of Martifer SGPS, S.A. and
were prepared in accordance with the International Financial Reporting Standards (“IFRS”), as adopted by the European Union, in
st
force at the beginning of the economic period started on 1 January 2015. These are the International Financial Reporting
Standards, issued by the International Accounting Standards Board ("IASB"), and interpretations issued by the International
Financial Reporting Interpretations Committee ("IFRIC") or by the previous Standing Interpretations Committee ("SIC"), that have
been endorsed by the European Union.
These consolidated financial statements have been prepared from the books and accounting records of the companies included in
the consolidation (Note 2) and have been prepared under the historical cost convention, except for the revaluation of certain noncurrent assets and certain financial instruments, which are stated at fair value.
The accounting policies and mensuration criteria adopted by the Company in the 2015 financial period are consistent with those
applied in the financial statements of the previous financial period, presented for comparative purposes, except in respect of the
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standards and interpretations entering into force on or after 1 January 2015, the adoption of which has not had a significant impact
on the Group’s comprehensive income or financial position.
st
Standards and changes to standards which are published but are mandatory for annual periods that start on or after 1 February
2015, and that the Company decided not to adopt in advance:
EFFECTIVE DATE
01-02-2015
IAS 19 – Defined benefit plans
01-02-2015
IAS 16 e IAS 38 – Amortization / depreciation calculation methods
01-01-2016
IAS 27 – Separate financial statements
01-01-2016
IAS 16 e IAS 41 – Agriculture: Plants that produce consumable biological assets
01-01-2016
IFRS 11 – Joint agreements
01-01-2016
IAS 1 – Presentation of the financial statements
01-01-2016
01-01-2016
The effect on the Company’s financial statements of the adoption of the standards, interpretations, amendments and revisions
st
referred above, on the period ended on 31 December 2015 was not material.
st
Standards effective on or after 1 February 2015, not yet endorsed by the European Union
As at this date, the following standards, interpretations, changes and revisions have already been issued but have not yet been
endorsed by the European Union:
EFFECTIVE DATE
Changes IFRS 10, 12 and IAS 28: application of the exemption of consolidation
01-01-2016
IFRS 9 – Financial instruments
01-01-2018
IFRS 14 – Regulatory deferral accounts
01-01-2016
IFRS 15 – Revenue from contracts with customers
01-01-2018
No significant effects are expected from the adoption of these standards in the Company’s financial statements.
In the preparation of the consolidated financial statements, in accordance with IAS/IFRS, the Company’s Board of Directors adopted
certain assumptions and estimates that can affect the assets and liabilities reported, as well as the profits and losses incurred in the
reporting periods (Note 1 xxvii). All the Board of Directors’ estimates and assumptions were made taking into consideration the best
knowledge available at the financial statements’ approval date and the information available at that time.
The accompanying consolidated financial statements were prepared for appreciation and approval by the annual Shareholder’s
th
General Meeting. The Board of Directors has approved them for issuance, on 6 April 2016 and believes that these will be
approved without any changes.
MAIN ACCOUNTING POLICIES, JUDGEMENTS AND ESTIMATES
The main accounting policies, judgements and estimates used in the preparation of the Company’s individual financial statements
for the years presented are as follows:
i) Financial investments
The equity holdings in Group and associated companies are registered at acquisition cost. An evaluation of the investments in
Group and associated companies is performed when there are signs that the asset may be impaired, being registered as expense
the impairment losses that may arise.
Subsidiaries are all the entities (including entities with special purposes) on which Martifer SGPS has the power to decide on
financial or operational policies, to which is usually associated the control, direct or indirect, of more than half of voting rights.
Associates are entities on which Martifer owns between 20 % and 50 % of voting rights, or on which Martifer has a significant
influence on the definition of the financial and operational policies.
ii) Intangible assets
Intangible assets acquired by the Company are stated at their acquisition cost, net of accumulated depreciation and impairment
losses, and are only recognized if it is probable that future economic benefits will flow from them to the Company, their value can be
reliably measured and if they are controlled by the Company.
Intangible assets comprise mainly software and other industrial property rights, which are depreciated on a straight-line basis over a
3 year period.
iii) Tangible fixed assets
Tangible assets are recorded at their acquisition cost, net of depreciation and accumulated impairment losses.
13
The depreciation rates used correspond to the following estimated useful lives:
Office equipment
4 years
3 to 5 years
Maintenance and repair costs that neither increase the useful life nor create significant improvements in tangible fixed assets are
recognized as costs in the year in which they are incurred.
iv) Financial assets and liabilities
Financial assets and liabilities are recognized in the balance sheet when the Company is a contractual party to the instrument.
a) Financial instruments:
The Company classifies financial assets in the following categories: ‘Financial assets at fair value through profit or loss’,
‘Borrowings and receivables’, ‘Held-to-maturity investments’ and ‘Available-for-sale financial assets’. The classification depends on
the intention inherent to the investment’s acquisition.
The classification is made at the initial recognition date and re-appreciated on a quarterly basis.
 Financial assets at fair value through profit or loss: this category is divided into two sub-categories: ‘financial assets classified
as held for trading’ and ‘financial assets designated at fair value through profit or loss’. A financial asset is classified under this
category, namely, if it is acquired for the purpose of selling it in the short term. Derivatives are also classified as instruments
held for trading, except if designated as an effective hedging instrument. Financial instruments in this category are classified
as current if they are held for trading or if it is expected that they are going to be realized within twelve months from the
balance sheet date;
 Held-to-maturity investments: this category includes financial assets, non-derivative, with fixed or variable reimbursements
with a fixed maturity, and which the Board of Directors intends to hold to maturity
 Available-for-sale financial assets: these include financial assets, non-derivative, that are designated as available-for-sale or
those that are not and cannot be classified in the preceding categories. This category is classified as non-current, unless the
Board of Directors has the intention to sell the investment within 12 months from the balance sheet date.
Held-to-maturity investments are classified as non-current investments, unless their maturity is less than a year from the balance
sheet date. Financial assets designated by the Group at fair value through profit or loss are classified as current.
All purchases and sales of financial instruments are recognized on the trade date, irrespective of the date of the financial settlement.
These financial assets are initially measured at cost, which is the consideration paid for them, and include transaction costs in the
case of available-for-sale investments.
After the initial recognition, financial assets valued at fair value through profit or loss and the available-for-sale investments are
re-valued at their fair values with reference to their market value at the balance sheet date (measured by their quoted price or
through an independent valuation), without regard for any transaction costs that may be incurred until their sale. Financial assets
not quoted and in respect of which it is not possible to reliably estimate their fair value, are maintained at acquisition cost less
impairment losses.
Gains and losses resulting from a change in the fair value of the ‘available–for-sale financial assets’ are recognized directly in
equity, under the caption Fair value reserves until the investment is sold, received or in any way alienated, or until the fair value of
the investment falls below the acquisition cost and this corresponds to an imparity, at which moment the accumulated gain or loss
is recognized in the income statement.
Gains and losses resulting from changes in the fair value of ‘Financial assets at fair value through profit or loss’ are recognized in
the income statement, under the caption ‘Gains/losses in financial assets’.
‘Held-to-maturity investments’ are recorded at their amortized cost using the effective interest rate method, net of capital
repayments and interest received.
Investments in subsidiaries and associated companies, as laid down by IAS 27, are valued at acquisition cost net of impairment losses.
b) Trade and other receivables
Trade and other receivable amounts have no implicit interest and are recorded at their nominal value less any impairment losses,
recognized in the allowance account ‘Accumulated Impairment losses’, in order to reflect their net realization value.
c) Borrowings
Borrowings are recorded as liabilities at the nominal value received, net of up-front fees and commissions relating to the issuance
of these instruments. Financial expenses are calculated based on the effective interest rate and are recorded in the income
statement on an accruals basis.
d) Trade and other payables
Accounts payable, which do not bear interest, are recorded at their nominal value which is substantially equivalent to their fair value.
e) Financial liabilities and equity instruments
Financial liabilities and equity instruments are classified based on their contractual substance. The Company classifies as equity
instruments those contracts that evidence a residual interest of the Group in a group of assets after deducting a group of liabilities.
f) Derivatives
The Company uses derivative instruments solely to manage its exposure to financial risks by hedging these, and not with a
trading objective. The use of derivative instruments has been approved by the Company’s Board of Directors.
The derivative instruments used by the Company, classified as cash-flows hedges, are exclusively related to the hedging of
interest rates on loans obtained. The loan amount, interest maturity and loan reimbursement plans inherent to the hedging
instrument are in all respects similar to the established conditions for the contracted loans, resulting in perfect hedges.
Interest rate derivatives (Cash-flow hedges) are initially recorded at cost, if any, and subsequently re-valued at their fair value.
The portion of the changes in the fair value of derivatives effectively covered are deferred in the statement of comprehensive
income in the caption ‘Fair value reserves – Derivatives’, being transferred to the income statement in the same period that the
hedge instrument affects the income statement. The gain or loss relating to the ineffective portion is recognized immediately in the
income statement, when determined.
Hedge accounting is discontinued when the hedging instrument expires or is sold. When a hedging instrument no longer qualifies
for hedge accounting the cumulative gain or loss that was deferred in the statement of comprehensive income in the caption ‘ Fair
value reserves – Derivatives’ is transferred to the income statement for the period and the subsequent revaluations of the
derivative are also recorded in the income statement.
v) Cash and cash equivalents
Cash and cash equivalents include cash on hand, cash at banks, term deposits and other treasury operations with a maturity under
three months, readily convertible to a known amount of cash, and which are subject to insignificant value changes.
vi) Revenue recognition and accrual based accounting
Revenue and expenses are recorded in the period to which they relate, regardless of their date of payment or receipt. The captions
of ‘Other accounts receivable’, ‘Deferred expenses’ and ‘Other accounts payable’ include expenses and income relating to the
current period, where payment and receipt will occur in future periods, as well as payments and receipts in the current period but
which relate to future periods.
Dividends from investments are recognized when the Company’s right to receive them has been established.
Interest revenue is accrued on a time basis, with reference to the principal outstanding and the effective interest rate applicable for
the operations.
13
vii) Balances and transactions expressed in foreign currency
All the assets and liabilities expressed in foreign currencies are translated to the functional currency, using the official exchange
rate at the reporting date. The exchange differences, favourable or unfavourable, originating from the differences between the
exchange rates at the transaction dates and those used at the collection, payment or at the balance sheet date, are recognized at
their gross amount as gains and losses in the income statement.
viii) Income Taxes
The Income tax charge for the period includes current and deferred tax, in accordance with IAS 12. Current tax is calculated based
on the taxable profit, in accordance with the local tax laws applicable to the location where the Company has its registered office.
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax base used in the calculation of taxable profit as well as in respect of some fiscal credits
attributed to the Company, and it is accounted for using the balance sheet liability method.
Deferred tax assets and liabilities are measured at the tax rates and based on the tax legislation expected to apply in the period in
which the differences reverse, and evaluated annually using tax rates (and tax laws) that have been enacted or substantively
enacted at each balance sheet date.
Deferred tax assets are generally recognized to extent that there is a reasonable probability that taxable profits will be available
against which to offset them. The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the
extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
The deferred tax amount that results from transactions or events recognized directly in equity is registered directly in equity as well,
not affecting the net income for the period.
ix) Interest charges on borrowings
Borrowing costs incurred with borrowings are recorded in the income statement on the accrual basis.
x) Provisions
Provisions are recognized when, and only when, the Group has an existing obligation (legal or constructive) as a result of a past
event, it is probable that the Group will be required to settle the obligation and a reliable estimate can be made of the amount of the
said obligation. These provisions are reviewed at each balance date and are adjusted to reflect the best estimate at that date,
taking into consideration all the risks and uncertainties inherent to such estimates. When a provision is determined using the future
cash flows estimated to settle the existing obligation, its carrying amount is the present value of those cash flows.
xi) Impairment of assets
The Company reviews the carrying amounts of its assets at each balance sheet date or whenever there is any indication (an event
or alteration of circumstances) that these assets may have suffered an impairment loss. When the asset carrying amount is greater
than its recoverable amount an impairment loss is recognized and recorded in the caption ‘Provisions and impairment losses’. The
recoverable amount is the higher of fair value less selling costs and value in use. The fair value less selling costs is the amount that
can be obtained in an arms-length transaction. Value in use is calculated by assessing the estimated future cash flows to be generated
by the asset and its residual value, all discounted to their present value. When it is not possible to estimate the recoverable amount
of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The reversal of impairment losses recorded in previous years is recognized when the underlying reasons that caused that entry are
no longer applicable and, consequently, the asset is no longer impaired. The reversal of impairment losses is recognized in the
income statement as an operational result. However, the reversal of an impairment loss is only recognised up to the amount that
would be recorded using the historical cost, or the revalued amount, net of amortization and depreciation, if the impairment loss had
not been recorded in previous years.
xii) Employee benefits
Variable remunerations
According to the statutes of some Group companies, the shareholders of those companies approved at the General Meeting or a
Remuneration Committee elected by shareholders, establish the fixed and variable remuneration to be distributed to members of
governing bodies. Bonus payments are recorded in the period to which they relate.
xiii) Statement of financial positions presentation
Assets to be realized and liabilities to be settled twelve months after the reporting date are classified as non-currents. Likewise,
given their nature, ‘Deferred tax’ and ‘Provisions’ are classified as non-current on the statement of financial position.
xiv) Contingent assets and liabilities
Contingent liabilities are not recorded in the financial statements. Instead, they are disclosed in the notes to the financial
statements, unless the probability of a cash outflow is remote.
Contingent assets are not recorded in the financial statements but are disclosed in the notes to the financial statements when future
economic benefits are probable.
xv) Cash Flow Statement
The cash flow statement is prepared, using the direct method, in accordance with IAS 7. The Company classifies as ‘Cash and
cash equivalents’ treasury operations which mature in less than three months, readily convertible to a known amount of cash, and
which are subject to insignificant value changes.
The cash flow statement is classified by operating, investing and financing activities. Operating activities include cash receipts from
clients, cash payments to suppliers, cash payments to and on behalf of employees and other operating activities’ payments and
receipts. Investing activities’ cash flows include, essentially, payments and receipts related with the acquisitions and sales of
tangible and intangible assets.
Financing activities’ cash flows include, essentially, payments and receipts of loans and borrowings, financial lease contracts and
dividend payments.
xvi) Subsequent events
Events occurring after the balance sheet date that provide additional information about conditions existing at the balance sheet date
(adjusting events), are recognized in the financial statements. Events occurring after the balance sheet date that provide
information on conditions occurring after the balance sheet date (non-adjusting events), if material, are disclosed in the notes to the
financial statements.
xvii) Judgements and estimates
In preparing the financial statements the Board of Directors used its best knowledge and accumulated experience of past and
current events in making certain assumptions as to future events.
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The most significant accounting estimates reflected in the financial statements for the periods ended on 31 December 2015 and
2014 include:




Impairment analysis of financial assets;
Recording of provisions and impairment losses;
Fair value of financial instruments; and
Recognition of deferred tax assets in respect of reportable tax losses.
Estimates used are based on the best information available during the preparation of the financial statements. However, events
may occur in subsequent periods that, not being foreseeable, were not considered in these estimates. Changes to the estimates
that occur after the date of these financial statements, will be recognized in net income, in accordance with IAS 8, using the
prospective methodology.
13
xviii) Financial risk management
Uncertainty, a characteristic of the financial markets, translates into a number of risks to which the activities of the Martifer Group
are exposed, namely price risk, currency risk, interest rate risk, liquidity risk and credit risk.
a) Currency risk
Currency risk is the possibility of registering gains or losses resulting from the changes in the foreign exchange rates between
different currencies. The Company’s exposure to currency risk results from the existence of foreign based subsidiaries in countries
with a currency other than the Euro and of transactions between these subsidiaries and other Group companies and the existence
of transactions made by companies operating in currency other than the reporting currency of the Group.
The currency risk management policy of the Company aims to reduce the sensitivity of its income statement to foreign exchange
rate variations.
The exposure to currency risk results mainly from the operational activities (in which the gains, earnings, assets and liabilities are
expressed in currency other than the reporting currency), from the operations performed between these subsidiaries and other
companies and the existence of operations performed by operational companies in a currency different from the reporting currency.
b) Interest rate risk
Interest rate risk reflects the possibility of changes in future interest charges in loans borrowings obtained as a result of changes in
market interest rate levels.
The Company relies on external financing to fund its activity and it is exposed to interest rate risk as a significant part of its
borrowings are indexed to market interest rates.
In the more significant long term loans the Company relies on fixed interest rate loans or uses interest rate derivatives to hedge
exposure to interest rate risk on these loans. The amounts, interest due dates and repayment schedules of the interest rate
derivatives are identical to those of the loans they hedge and, as such, these derivatives are considered perfect hedges.
During 2015, the reference interest rates in the euro area remained at very low levels, even reaching negative values at the end of the
year. According to the European Central Bank projections published on March 216 (“March 2016 ECB staff macroeconomic projections
for the euro area”), rates should remain at very low levels during 2016 and 2017, with a modest growth expected for 2018.
th
premium rates (spread) to very competitive values, allowing for a lower exposure to interest rate risk. This change in the bank
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financing pricing took effect as from 1 January 2015. This factor, together with the expected stability in the reference rates
contribute for Martifer’s current low exposure to interest rate risk.
c) Liquidity risk
Liquidity risk reflects the prospect of the Company and the Group not satisfying their financial responsibilities with the available
financial resources.
The main objective of liquidity risk management policy is to ensure that the Group has at its disposal at any time the sufficient
financial resources to meet its responsibilities and proceed with strategy outlined, honouring all commitments with third parties,
through proper management of the relation cost - maturity of debt.
As mentioned above, at the end of 2015, the Group restructured its debt with financial institutions, through the rescheduling of bank
at the same time, to allow the cash surpluses to be sufficient to comply with its responsibilities.
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As a consequence of the previously mentioned measures, it is verifiable that, on 31 December 2015, the Current Assets largely
The financial management monitors the implementation of risk management policies set by the management to ensure that the
economic and financial risks are identified, measured and managed in accordance with such policies.
d) Credit risk
The Company’s credit risk results fundamentally from its relationship with financial institutions, occurring within the scope of its
normal activity, associated with the potential default, by the financial institutions, with which it has contracted, in the regular course
of business, term deposits, current accounts and derivatives.
To mitigate this risk, the Company diversifies its counterparties, to avoid an excessive concentration of credit risk, and privileges the
contracting of less complex financial instruments in detriment of instruments which structure is not fully known.
2. SALES AND SERVICES RENDERED
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Sales and services rendered for the periods ended on 31 December 2015 and 2014 refer, essentially, to management fees
charged to Group companies:
CAPTION
Services rendered (Note 22)
FY 2015
FY 2014
1,178,583
1,016,372
1,178,583
1,016,372
3. SUPPLIES AND EXTERNAL SERVICES
st
The breakdown of supplies and external services for the periods ended on 31 December 2015 and 2014 is as follows:
CAPTION
FY 2015
FY 2014
Specialized services
213,747
261,030
Advertising
3,274
Fees
1,200
14,675
Maintenance and repairs
2,725
2,827
Stationery
6,195
221
808
5,541
16,723
27,745
Articles for offering
Fuel
Travel and accommodation
66
Leases and rents
36
Communications
4,462
2,918
55,257
56,178
Legal and notarial fees
7,030
3,861
Representation expenses
2,169
2,044
Insurance
Cleaning, health and safety
Other
13
705
3,983
314,344
381,089
The caption Supplies and external services decreased in 2015 which is closely related with the captions ‘Specialized services’,
‘Fees’ and ‘Travel and accommodation’. The caption ‘Specialized Services’ is related with the provision of financial and consulting
services.
13
4. STAFF COSTS
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O Staff costs for the periods ended on 31 December 2015 and 2014 can be analysed as follows:
CAPTION
FY 2015
FY 2014
Remuneration
329,770
477,377
55,822
101,245
Social charges
Charges on remuneration
Other
7,280
11,310
392,872
589,932
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On 31 December 2015 and 2014, the caption ‘Other’ includes, essentially, costs supported with training, medical expenses and
with labour accident insurance.
The decrease in the caption ‘Staff Costs’ in 2015 is due to the decrease of staff in the company. During 2015 and 2014, the
company’s average staff number was as follows:
CAPTION
FY 2015
FY 2014
Directors
3
5
Other employees
1
9
4
14
FY 2015
FY 2014
12,228,914
(119,189,472)
12,228,914
(119,189,472)
Functional division
5. PROVISIONS AND IMPAIRMENT LOSSES
st
Provisions and impairment losses for the periods ended on 31 December 2015 and 2014 are as follows:
CAPTION
Impairment losses in financial assets (Note 11)
Provisions
At the end of 2015, impairment losses and reversal were recorded, totalling 3,735,269 euros (Martifer Solar, SGPS, S.A. 3,174,976
euros and Prio Energy SGPS, S.A. 560,293 euros) and 15,964,182 euros (Martifer Renewables, SGPS, S.A. 949,354 euros and
Martifer Metallic Constructions, SGPS, S.A. 8,498,978 euros), respectively, following impairment tests performed to those assets.
The reinforcement of impairment losses in the period is mainly due to the deterioration of equity in its subsidiaries, due to losses in
the operational activity (see Note 11).
31ST DECEMBER 2015
Accumulated impairment losses
OPENING BALANCE
ADDITIONS
REVERSAL
USE
CLOSING BALANCE
298,867,316
3,735,269
15,964,182
41,792,033
244,846,370
298,867,316
3,735,269
15,964,182
41,792,033
244,846,370
This use is mainly due to the sale of Martifer Global and Martifer Energy Systems to Martifer Metallic Constructions.
Impairment tests for various financial assets of the company have been prepared in accordance with the Discounted Cash Flow
evaluation model (DCF). The values of these evaluations are determined by past performance and the expectation of market
development, with future cash-flow projections, for a five year period, being drawn up for each of the businesses, based on
medium/long term plans approved by the Board of Directors.
These estimates were made considering a discount rate and a growth rate as mentioned on Note 11.
6. FINANCIAL RESULTS
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The financial results for the periods ended on 31 December 2015 and 2014 may be analysed as follows:
CAPTION
FY 2015
FY 2014
1,202,555
2,014,453
320
4,250,000
1,202,875
6,264,453
FY 2015
FY 2014
3,511,786
9,513,736
Interest and similar revenue
Borrowings and accounts receivable (including bank deposits)
Interest earned
Other revenue and financial gains
CAPTION
Interest and similar expenses
Borrowings and accounts payable
Interest charges on bank loans
Other expenses and financial losses relating to other financial liabilities
Other expenses and financial losses
179,455
434,609
3,691,241
9,948,345
During 2014 the caption ‘other revenue and financial gains’ is mainly related to the agreement with Barclays, concerning the
settlement of commercial paper of 9,616,688.56 euros, obtaining a debt relief in the amount above mentioned.
The significant decrease in interest charges on bank loans reflects the new conditions agreed in the financial restructuring
st
concluded on December 2015, but which effects report to 1 January 2015.
The caption ‘Other expenses and financial losses’ results, essentially, from the fees incurred in authorized overdrafts.
7. INCOME TAX
st
The breakdown of assets giving rise to deferred taxes in the periods ended on 31 December 2015 and 2014 may be analysed as follows:
CAPTION
Tax losses carried forward
Fair value of derivatives
Deferred tax assets
FY 2015
FY 2014
2,027,137
2,027,137
37,929
37,929
2,065,066
2,065,066
In accordance with the tax statements presented by companies that recorded deferred tax assets arising from tax losses carried
st
forward, as on 31 December 2015 and 2014, and using exchange rates effective at that time, tax losses carried forward can be
summarised as follows:
31 DECEMBER 2015
Generated in 2014
31 DECEMBER 2014
TAX LOSSES
CARRIED
FORWARD
DEFERRED TAX
ASSET
TIME LIMIT
9,009,498
2,027,137
2026
9,009,498
2,027,137
TAX LOSSES
CARRIED
FORWARD
DEFERRED TAX
ASSET
TIME LIMIT
Generated in 2009
393,193
104,196
2015
Generated in 2011
6,076,302
1,610,221
2015
Generated in 2014
1,180,075
312,720
2026
7,649,570
2,027,137
13
st
On 31 December 2015 there were tax losses, calculated by the companies taxed under the Special Regime for Taxation of
Corporate Groups (RETGS), in which the Company is the dominant company before and during the application of RETGS,
st
amounting to 175,762,608 euros (197,928,779 euros on 31 December 2014), which potential deferred tax assets amounted to
st
39,546,587 euros (44,533,976 euros on 31 December 2014. In a perspective of prudence, deferred tax assets were registered,
related with tax losses in Portugal to use in the future, just totalling 2,027,137 euros. The decomposition can be analysed as
follows:
31 DECEMBER 2015
TAX LOSSES
CARRIED
FORWARD
DEFERRED TAX
ASSET
Generated in 2008
26,678,470
Generated in 2009
11,817,774
Generated in 2010
31 DECEMBER 2014
TIME LIMIT
TAX LOSSES
CARRIED
FORWARD
DEFERRED TAX
ASSET
TIME LIMIT
6,002,656
2015
27,564,225
6,201,951
2014
2,658,999
2015/2016
11,817,774
2,658,999
2015
12,722,095
2,862,471
2017
19,515,648
4,391,021
2014
Generated in 2011
24,942,511
5,612,065
2015
24,942,511
5,612,065
2015
Generated in 2012
24,924,811
5,608,082
2017
24,924,811
5,608,082
2017
Generated in 2013
37,128,240
8,353,854
2018
37,128,239
8,353,854
2018
Generated in 2014
31,138,106
7,006,074
2026
52,035,571
11,708,004
2026
Generated in 2015
6,410,603
1,442,386
2027
175,762,608
39,546,587
197,928,779
44,533,976
The reconciliation of the income tax charge for the period and the current tax charge may be analysed as follows:
CAPTION
FY 2015
FY 2014
69,134
3,875
Under / (over) taxation estimates
(21,626)
(36,585)
Tax charge for the period
(21,626)
(36,585)
47,508
(32,710)
FY 2015
FY 2014
1,448,749
(121,645,640)
1,448,749
(121,645,640)
304,237
(27,978,497)
(2,568,072)
27,413,578
849
(223,033)
Current tax
Deferred taxes relating to the reversal of timing differences
Effective tax rate
Net profit
st
On 31 December 2015 and 2014, the reconciliation between the normal and effective rate is as follows:
CAPTION
Net income before taxes
Nominal income tax on results (nominal rate 21 % / 23 %)
Costs not deductible for tax purposes:
Permanent differences
Impairment losses
Restitution of not deductible taxes and over taxation estimates
Capital gain or loss in sale of financial assets
Accounting capital losses
Limitation to deduction of net financial expenses
Other
Accounting capital gains
Tax benefits
Tax losses arising in this period in respect of which no deferred tax assets were recognised
Under / (over) taxation estimates
Autonomous taxation
Municipality tax
Effective tax charge on income
Net profit
(9,146)
1,841,814
(530)
305,949
617,644
(2,714)
265
(1,378,876)
(1,951)
1,536
1,552,473
178,183
(21,626)
(36,585)
2,637
3,875
12,788
47,508
(32,710)
1,401,241
(121,612,930)
In 2015, Martifer SGPS, S.A. is subject to corporate income tax (IRC) at the normal rate of 21 %, increased by the municipal
surcharge of up to 1.5% of the taxable profit.
Additionally, when the taxable profit subject to corporate income tax is between 1,500,000 euros and 7,500,000 euros there is an
additional state surcharge of 3 %, for the amount between 7,500,000 euros and 35,000,000 euros applies a tax rate of 5 %, for the
amount above 35,000,000 euros applies a tax rate of 7 %.
In terms of article 88 of the Corporate Tax Code, the company is, additionally, subject to autonomous tax over a number of
expenses, at the rates laid down in the said Code.
Since January 2011, Martifer SGPS, SA is covered by the “RETGS”, which comprises companies in which it holds, directly or
indirectly, at least 75 % of its capital and meet simultaneously with the other conditions set by that mechanism. The remaining
Martifer Group companies, not covered by the special tax mechanism, are taxed individually, based on their taxable profit and at the
applicable tax rates.
In accordance with the legislation in force, tax declarations remain subject to review and adjustment by the tax authorities during a
period of four years (five years for social security), except when there are tax losses, fiscal benefits were conceded, or inspections,
claims or impugnations are underway, in which cases, depending on the circumstances, the period is extended or suspended.
Consequently, the tax declarations for the years 2012 through 2015 may be subject to review.
The payment of 36 instalments regarding the IRC 2013 in the total amount of 435.187 euros, and that on noncurrent liabilities is
considered 290,125.18 euros, is underway based on an agreement with the Tax Authority.
The Board of Directors believes that any adjustments resulting from reviews/inspections by the tax authorities will have no
st
significant impact on the financial statements on 31 December 2014.
8. EARNINGS PER SHARE
Martifer SGPS has issued solely ordinary shares so there are no special dividends or voting rights.
Martifer has a single type of potentially dilutive ordinary share: stock options. To calculate the diluted earnings per share it is
necessary to determine whether these options, regardless of whether they may or not be exercised, have a dilutive effect, which
occurs when the option exercise price is lower than the quoted share price. Considering that Martifer’s quoted share price averaged
st
st
0.29 euros between 1 January 2015 and 31 December 2015, which is lower than the option exercise price (3.84 euros), the latter
can be considered non-dilutive as their exercising would result in a reduction in the ordinary shares in circulation.
st
Hence, on 31 December 2015 there is no difference between the basic and diluted earnings per share calculation.
Martifer SGPS SA’s share capital is represented by 100,000,000 ordinary shares, totally subscribed and realized, representing a
share capital of Euro 50,000,000.
The weighted average number of shares in circulation is reduced in 2,215,910 shares, corresponding to own shares acquired by
Martifer SGPS.
st
On 31 December 2015 and 2014, the calculation of earnings per share, basic and diluted, may be demonstrated as follows:
CAPTION
Net profit for the period (I)
Weighted average number of shares in circulation (II)
Earnings per share, basic and diluted (I) / (II)
FY 2015
FY 2014
1,401,241
(121,612,930)
97,784,090
97,784,090
0,0143
(1,2437)
13
9. INTANGIBLE ASSETS
st
Gross intangible assets for the period ended on 31 December 2015 and 2014 may be analysed as follows:
31 DECEMBER 2015
Computer programs
Other intangible assets
31 DECEMBER 2014
Computer programs
OPENING
BALANCE
ADDITIONS
DISPOSALS AND
WRITE-OFFS
TRANSFERS AND
OTHER MOVEMENTS
CLOSING
BALANCE
1,349
1,349
42,265
42,265
43,614
0
0
0
43,614
OPENING
BALANCE
ADDITIONS
DISPOSALS AND
WRITE-OFFS
TRANSFERS AND
OTHER MOVEMENTS
CLOSING
BALANCE
1,349
1,349
42,265
42,265
43,614
0
0
0
43,614
st
Accumulated amortization and impairment losses for the period ended on 31 December 2014 and 2013 may be analysed as follows:
31 DECEMBER 2015
Computer programs
31 DECEMBER 2014
Computer programs
OPENING
BALANCE
ADDITIONS
DISPOSALS AND
WRITE-OFFS
TRANSFERS AND
OTHER MOVEMENTS
1,349
CLOSING
BALANCE
1,349
41,076
1,085
42,161
42,425
1,085
0
0
43,510
OPENING
BALANCE
ADDITIONS
DISPOSALS AND
WRITE-OFFS
TRANSFERS AND
OTHER MOVEMENTS
CLOSING
BALANCE
1,349
1,349
36,078
4,998
37,427
4,998
41,076
0
0
42,425
Net value
2015
104
2014
1,189
10. TANGIBLE FIXED ASSETS
st
Gross amounts in respect of transportation and office equipment for the periods ended on 31 December 2015 and 2014 may be
analysed as follows:
31 DECEMBER 2015
OPENING
BALANCE
ADDITIONS
DISPOSALS AND
WRITE-OFFS
TRANSFERS AND
OTHER MOVEMENTS
CLOSING
BALANCE
31,741
(31,741)
0
Office equipment
36,429
750
(2,552)
34,627
68,170
750
(34,293)
0
34,627
OPENING
BALANCE
ADDITIONS
DISPOSALS AND
WRITE-OFFS
TRANSFERS AND
OTHER MOVEMENTS
CLOSING
BALANCE
31 DECEMBER 2014
48,504
Office equipment
36,518
2,250
(2,339)
85,022
2,250
(19,102)
(16,763)
31,741
36,429
0
68,170
Accumulated depreciation and impairment losses respecting transportation and office equipment for the periods ended on
st
31 December 2014 and 2013 may be analysed as follows:
31 DECEMBER 2015
OPENING
BALANCE
ADDITIONS
DISPOSALS AND
WRITE-OFFS
TRANSFERS AND
OTHER MOVEMENTS
CLOSING
BALANCE
31,741
(31,741)
0
Office equipment
31,680
2,704
(2,552)
31,832
63,421
2,704
(34,293)
0
31,832
OPENING
BALANCE
ADDITIONS
DISPOSALS AND
WRITE-OFFS
TRANSFERS AND
OTHER MOVEMENTS
CLOSING
BALANCE
31 DECEMBER 2014
48,051
453
(16,763)
Office equipment
31,394
2,625
(2,339)
79,445
3,078
(19,102)
31,741
31,680
0
63,421
Net value
2015
2,794
2014
4,749
11. FINANCIAL INVESTMENTS
st
On 31 December 2015 and 2014, the breakdown of financial investments in subsidiaries and associated companies was as follows:
% HELD
ACQUISITION
VALUE
SUPPLEMENTARY
CAPITAL
IMPAIRMENT
LOSS
TOTAL
100%
99,765,968
145,462,327
(152,341,778)
92,886,517
1%
47
2,006,564
(2,006,611)
0
75%
12,273,756
123,089,899
(73,522,874)
61,840,781
st
31 December 2015
Eviva Hidro
Martifer Gmbh
100%
21,800
99,970
(2,770)
119,000
Ventinveste
6%
3,000
805,000
(808,000)
0
Prio Energy SGPS
5%
267,100
293,193
(560,293)
0
100%
26,280,763
(15,604,044)
10,676,719
Martifer Solar SGPS
Ancora Wind - Energia Eólica
Martifer Romania SRL
CEC
1%
1
1
98%
1,265
1,265
3%
25,000
25,000
138,638,700
271,756,953
(244,846,370)
165,549,283
100%
99,765,968
145,462,327
(153,291,132)
91,937,163
1%
47
2,006,564
(2,006,611)
0
100%
12,273,756
123,089,899
(88,537,702)
46,825,953
100%
101,291
6,176,455
(2,148,492)
4,129,254
Martifer Gmbh
100%
21,800
99,971
(2,821)
118,950
5%
3,000
805,000
(808,000)
0
100%
6,087,775
36,165,765
(39,415,740)
2,837,800
293,193
31st December 2014
Eviva Hidro
Ventinveste
Prio Energy SGPS
10%
267,100
Martifer Gestuni si Servicii
100%
1,265
Martifer Solar SGPS
100%
26,280,763
Martifer Global SGPS
100%
50,000
1%
1
1
25,000
25,000
Ancora Wind - Energia Eólica
CEC
144,877,766
560,293
1,265
227,750
314,326,924
(12,429,068)
13,851,695
(227,750)
50,000
(298,867,316)
160,337,374
The financial investments are measured as to its recoverable amount whenever there are impairment indicators, being considered
for evidence whenever the equity of subsidiaries (considering the consolidated equity whenever applicable) is lower than their
acquisition value. Based on this principle, we identified indicators of impairment in the shareholdings in Martifer Metallic
13
Constructions, SGPS, S.A., in Martifer Renewables SGPS, S.A. and in Martifer Solar, SGPS, S.A.. The impairment tests performed
considered the following assumptions:
For the shareholdings of Martifer Metallic Constructions, SGPS, S.A., it was considered adequate to assess its recoverable
amount based on the value in use, using a discounted cash flow method, supported by the business plans drawn by the people
in charge of the business unit and approved by the respective Board of Directors and using different discount rates according
to the risks inherent to each business.

st
On 31 December 2015, it was recorded an impairment loss of 73,522,874 euros, which compares with the impairment
recorded in 2014, of 88,537,702 euros, with the resulting reversion of 15,014,828 euros. The methods and assumptions used
in the identification, or not, of impairment losses to these financial assets were as follows:
MARTIFER METALLIC
CONSTRUCTIONS, SGPS, S.A.
Consolidated equity
11,180,873
Financial asset
135,363,655
Period use
1
2
5-year cash flow projections
Growth rate (g) 1
2.00%
Average growth rate of EBITDA for five years
5.20%
Discount rate 2
6.95%
Growth rate used to extrapolate the cash flows beyond the business plan period
A change (of normal scenarios) of the main assumptions used in the recoverable amount calculation would have the impact
constant in the table below:
MMC
WACC
INCREASE
IN 1,0 P.P
WACC
DECREASE
IN 1,0 P.P
VAR.
TURNOVER
+5,0 P.P.(1)
VAR.
TURNOVER
- 5,0 P.P.(1)
INCREASE
IN EBITDA/
TURNOVER MARGIN
IN 0.5 P.P. (2)
DECREASE
IN EBITDA/
TURNOVER MARGIN
(2)
IN 0.5 P.P.
6.95%
7.95%
5.95%
6.95%
6.95%
6.95%
6.95%
10.2%
10.2%
10.2%
15.2%
5.2%
10.2%
10.2%
5.20%
5.20%
5.20%
5.20%
5.20%
5.7%
4.7%
Net Book Value (2)
61,841
61,841
61,841
61,841
61,841
61,841
61,841
61,841
38,155
97,441
116,008
14,909
99,421
53,368
0
(23,686)
35,600
No
impairment
54,168
No
impairment
(46,932)
37,580
(8,473)
Impairment
No impairment
Impairment
(1)
(2)
Impairment
Estimated Average growth rate estimated based on the company’s 5 year business plan, carried out according to the Board of Directors’ estimates and assumptions
In the situations where impairment was recorded, the book value was adjusted for the use value resulting from the impairment
test.

For Martifer Renewables, SGPS, S.A. and Martifer Solar, SGPS, S.A., the Group considers as a valid indicator consolidated
Equity, and in this way, impairments were recorded in 152,341,778 euros and 15,604,044 euros respectively. When comparing
with the impairments recorded in 2014, following the impairments recorded in 2015, in this period a reversal of 3,174,976 euros
was recorded to Martifer Renewables SGPS, S.A. and a reinforcement of impairment of 3,174,976 for Martifer Solar, SGPS,
S.A.. this principle underlies the fact that Martifer Renewables SGPS, S.A. and Martifer Solar, SGPS, S.A. have a relatively low
turnover, considering their assets, and include in their consolidated, mainly assets related to wind farms and solar projects
under development and to which, when applicable, their realisable value has been measured and their impairments registered
and so the consolidated equity already reflects these adjustments.
Supplementary capital doesn’t bear interests or repayment term.
12. GROUP COMPANIES
st
On 31 December 2015 and 2014, shareholder loans and other financial operation balances (assets) are as follows:
LOANS
Nutre SGPS
Navalria
2015
OTHER
FINANCIAL OP.
71,409
8,094
254,779
TOTAL
LOANS
71,409
2014
OTHER
FINANCIAL OP.
1,071,409
1,071,409
896,894
1,555,275
896,894
1,555,275
196,078
127,400
1,699
2,085,707
196,078
1,527,400
20,726,319
16,699
2,085,707
470
5,934,932
470
28,076,251
TOTAL
Prio Energy SGPS
Martifer Alumínios
Martifer Renewables SGPS SA
107,190
366,631
Martifer Renewables
Martifer Solar SGPS
Ventinveste
Martifer Gmbh
West Sea - Estaleiros Navais
Other
5,575
7,040,510
125,486
1,400,000
21,396,737
22,500
22,819,237
0
220,206
4,097
216,783
340,370
225
8,761,355
7,040,510
1,620,206
21,396,737
26,597
216,783
1,400,000
20,726,319
15,000
30,372,242
22,141,319
These loans bear interest at a market rate.
st
The liabilities presented by the company, with Group companies, on 31 December 2015 and 2014, are as follows:
Martifer Alumínios
31 DECEMBER 2015
31 DECEMBER 2014
2,247,059
2,156,161
45,415
Martifer Solar SGPS
3,500
Gebox
7,363
1,000
65,506
65,506
Navalria
5,872
Martifer Solar SRL
Martifer Gestão de Investimentos
10,592
23,410
27,314,859
22,789,734
Martifer Renewables
17,640
16,670
62,240
73,045
Sociedade de Madeiras do Vouga
11,876
4,500
8,084
4,519
4,498
5,109
1,540
541
Nagatel Viseu - Promoção Imobiliária
4,498
4,500
West Sea - Estaleiros Navais
135
29,804,805
25,150,567
st
On 31 December 2014, the amount presented in Group companies in liabilities refers mainly to liabilities that the company has
with its subsidiaries under the special taxation of groups of companies’ mechanism (“RETGS”) and to treasury transactions
conceded by Martifer Renewables SGPS, S.A.. These treasury transactions bear interests at market rates.
The main amounts relate to the transfer of tax losses carried forward that have been recognized by the subsidiaries and that,
according with the Directors’ expectation, will be recovered within the Group.
13
13. TRADE RECEIVABLES AND OTHER ACCOUNTS RECEIVABLE
st
On 31 December 2015 and 2014, the trade and other accounts receivable were as follows:
CAPTION
Trade receivables
FY 2015
FY 2014
3,728,876
3,331,425
3,728,876
3,331,425
21,928,719
21,896,336
Other accounts receivables
Other debtors
Other debtors – impairment losses
(826,362)
21,102,357
21,896,336
st
On 31 December 2015 and 2014, the ageing of balances in these captions was as follows:
OVERDUE
31 DECEMBER 2015
Trade receivables
TOTAL
NOT OVERDUE
LESS THAN 90 DAYS
90 TO 180 DAYS
180 TO 360 DAYS
MORE THAN 360 DAYS
3,728,876
1,320,829
267,411
895,693
227,990
1,016,953
21,102,357
20,557,635
4,084
96
1,742
538,800
24,831,233
21,878,464
271,495
895,789
229,732
1,555,753
OVERDUE
31 DECEMBER 2014
Trade receivables
TOTAL
NOT OVERDUE
LESS THAN 90 DAYS
TOTAL
NOT OVERDUE
LESS THAN 90 DAYS
3,331,425
2,102,042
80,486
182
52,490
1,096,225
21,896,336
20,439,330
485,720
342,389
628,898
-
25,227,761
22,541,372
566,206
342,571
681,388
1,096,225
The company considers that there is no deterioration of credit rating of the counterparty (including subsidiaries and associate
companies) meaning that the old balances are not at risk of uncollectibility. The increase in the caption “Other accounts receivables” is
related to the sale of NUTRE SGPS, S.A. and until December 2016 CERES AGRICULTURE HOLDINGS COOPERATIEF U.A. has to
pay the amount of 19,600,000 euros under the terms of the contract of sale.
14. STATE AND OTHER PUBLIC ENTITIES
st
On 31 December 2015 and 2014, the balances of the caption ‘State and other public entities’ are as follows:
CAPTION
FY 2015
FY 2014
Liabilities
Income tax
676,516
Withholding taxes
13,977
7,276
Value added taxes
163,723
38,635
Social Security contributions
6,834
14,640
861,050
60,551
FY 2015
FY 2014
290,955
598,842
290,955
598,842
15. CASH AND CASH EQUIVALENTS
The caption ‘Cash and cash equivalents’ may be analysed as follows:
CAPTION
Bank deposits
‘Cash and cash equivalents’ include short term bank deposits, with maturities not exceeding 3 months, for which the risk of value
st
alteration is insignificant. On 31 December 2015 and 2014, there were no restrictions associated with the balances of the caption
‘Cash and cash equivalents’.
16. SHARE CAPITAL, RESERVES AND OWN SHARES
Share capital
st
Martifer SGPS’s share capital, fully subscribed and realized on 31 December 2015, amounted to 50,000,000 euros and is represented
by 100,000,000 bearer shares with a par value of 50 cents each. All shares have the same rights, namely one share one vote.
During the 2015 and 2014 economic periods there were no changes in the number of shares representing the Company’s share capital.
Treasury Stock
During the 2015 economic period, Martifer SGPS didn’t acquire, through the stock exchange, own shares. The Group held
2,215,910 treasury shares, corresponding to 2.22% of its capital. In accordance with Portuguese commercial legislation, company
is required to keep unavailable a reserve corresponding to the own shares amount, in which is included the caption other reserves.
st
On 31 December 2015, the share capital of Martifer SGPS, S.A. was held in 42.7 % by I’M SGPS, S.A., 37.5 % by Mota-Engil
SGPS, S.A., 2.22 % are treasury shares and 0.65% by board members. The remaining 17.22 % represents free-float listed in
Euronext Lisbon.
Share premium
Share premiums correspond to excess amounts gained with the issue of or an increase in share capital. In accordance with
Portuguese commercial legislation, the amounts included in this caption must comply with the regime applicable to ‘legal reserves’,
that is, they are not distributable except in the event of liquidation, but they may be used to offset losses, after all the other reserves
have been used up, and/or be incorporated in share capital.
Reserves
Legal reserve
Portuguese commercial legislation establishes that at least 5 % of the annual net income must be used to increase the legal
reserve until the latter represents at least 20 % of the share capital. This reserve is non-distributable, except in the event of
liquidation, but may be used to offset losses, after all the other reserves have been used up, and/or be incorporated in share capital.
Other reserves
st
On 31 December 2015, this caption included a reserve that is not available, amounting to 2,868,519 euros (2014: 2,868,519
euros), related to the own shares amount.
Under Portuguese legislation, the amount of reserves considered distributable is determined based on the Company’s individual
st
financial statements, prepared in accordance with International Financial Reporting Standards (IFRS). On 31 December 2015,
Martifer SGPS, S.A. has no distributable reserves available.
13
17. BORROWINGS
st
The borrowings obtained, with reference to the periods ended on 31 December 2015 and 2014 are as follows:
31 DECEMBER 2015
UP TO 1 YEAR
OVER 5 YEARS
TOTAL
Amounts due to financial institutions
Bank loans
31 DECEMBER 2014
188,686
130,353,263
130,541,949
188,686
0
130,353,263
0
130,541,949
UP TO 1 YEAR
BETWEEN 1 AND 3
YEARS
OVER 5 YEARS
TOTAL
2,844,153
23,884,399
60,991,409
19,308,526
107,028,487
Amounts due to financial institutions
Bank loans
Authorized Overdrafts
15,499,448
15,499,448
Other loans obtained
Commercial paper
5,000,000
23,343,601
5,000,000
23,884,399
60,991,409
19,308,526
127,527,935
The debt restructuring agreement made with the financial institution made possible the adequacy of the maturity of the inflows in the
Group’s operational activity to the (divestment) investment to the outflows in the financing activity, through the rescheduling of
maturities over time, enlarging the average debt maturity to make it more coincident with the permanence degree of the long term
st
assets and a maturity which allows the cash surpluses to be enough to comply with its needs. Therefore, on 31 December 2015,
the average debt maturity was around 5 years.
The average interest rate on Martifer SGPS’s borrowings, during 2015, was 0.98 % (in 2014 was 6.38 %).
18. TRADE PAYABLES AND OTHER ACCOUNTS PAYABLES
The information regarding trade and other accounts payable for the periods ended December 31, 2014 and 2013 may be analysed
as follows:
CAPTION
FY 2015
FY 2014
Trade payables
753,338
938,867
753,338
938,867
Expense accruals
458,572
2,199,461
Other accruals
97,979
96,130
Other creditors
373,226
136,390
929,777
2,431,981
1,683,115
3,370,848
st
On 31 December 2015 and 2014, this caption includes amounts due to suppliers arising from the Company’s operational activity
and from the acquisition of tangible and intangible fixed assets.
The Board of Directors believes that the fair value of these balances do not differ significantly from their carrying value and the
impact of updating these amounts is not material.
st
On 31 December 2015 and 2014, the ageing of accounts payable in captions ’Trade payables’ and ‘Other payables’ is as follows:
OVERDUE
31 DECEMBER 2015
TOTAL
Trade payables
753,338
Other creditors
373,227
NOT OVERDUE
UP TO 90 DAYS
90 TO 180 DAYS
180 TO 360 DAYS
OVER 360 DAYS
55,865
10,335
37,593
649,545
371,721
1,506
409,314
651,051
1,126,565
0
55,865
10,335
TOTAL
NOT OVERDUE
UP TO 90 DAYS
TOTAL
NOT OVERDUE
UP TO 90 DAYS
938,867
373,114
9,295
8,979
4,002
543,475
136,390
136,390
1,075,257
509,504
9,295
8,979
4,002
543,475
OVERDUE
31 DECEMBER 2014
Trade payables
Other creditors
The accounts payable due for more than 180 days refers to amounts to pay to trade creditors with which the Group maintains
regular commercial relations.
Besides the financial liabilities disclosed above and in Notes 16 and 17, the Group does not have any other financial liabilities.
19. PROVISIONS
The amount of provisions, of 618,500 euros, refers to potential contractual obligations related with its subsidiaries.
20. COMMITMENTS
Operating Guarantees
st
On 31 December 2014 and 2013, the main operating guarantees issued by the Company are as follows:
Martifer SGPS
FY 2015
FY 2014
111,642,567
88,898,000
111,642,567
88,898,000
The amount registered in Martifer SGPS corresponds to guarantees presented to third parties, related with contractual obligations in
Martifer Solar.
Given that the EPC solar park construction contracts require Martifer Solar and/or companies it has shareholdings in to guarantee,
amongst others, the quality of the materials and design, photovoltaic installations, the achievement of certain performance and
wattage ratios with the photovoltaic modules, Martifer SGPS undertook to provide Martifer Solar and/or companies it has
shareholdings in with the means necessary to guarantee full compliance with contractual obligations. Martifer Solar is presently
considered to have the capacity to support its own commitments without recourse to the Holding Company.
13
Pledges or Mortgages
st
On 31 December 2015 the collateral given by the Company may be summarized as follows:
COMPANY
GUARANTEE
ASSET VALUE
DEBT AMOUNT
Martifer SGPS, SA
Martifer SGPS, SA
Martifer SGPS, SA
1,924,346
Share pledge of Martifer Solar SA 55 % (No. shares 27,500,000)
Mortgage of building in Oliveira de Frades (article 1943) - Components’ plant
Assets pledge MT Construções
General Mortgage (7.5 M€) of the wind tower industrial building (article 1914)
Martifer SGPS, SA
7,133,939
8,314,077
nd
2 degree share pledge of Martifer Solar SA 55 % (no. shares 27,500,000)
st
1 degree share pledge of Martifer Renewables SGPS 65 % (no. shares 65,000,000)
Martifer SGPS, SA
Mortgage of building in Oliveira de Frades (article P-2003) Plant OlF MTC
Martifer SGPS, SA
Loan Note Class A n. 5
Warehouse Martifer OF
Multipark Paços de Ferreira
Martifer SGPS, SA
10,676,719
Other lands MGI
1st degree share pledge of Martifer Renewables SGPS 10% (no. shares 10,000,000)
Market pledge several equipment
Market pledge equipment
71,052,955
522,043
4,500,000
128,428,917
95,337
361,646
357,300
9,288,652
320,688
102,708
124,207,738
130,353,263
‘* Besides the loan of the company, these mortgages also warrant the current account of the Martifer Construções, S.A. and Navalria, S.A.,
amounting to 8 million euros.
21. REMUNERATION PAID TO MANAGEMENT, THE SUPERVISORY BOARD
AND THE CHARTERED ACCOUNTANT
Remuneration attributed to the key management personnel, by remuneration category, can be summarized as follows:
CAPTION
FY 2015
FY 2014
Fixed remuneration
130,793
116,367
130,793
116,367
The remuneration attributed to the Supervisory Board in 2015 amounted to 14,400 euros (2014: Euro 14,400) and the remuneration
paid to the Chartered Accountant amounted to 41,000 euros (2014: 41,520 euros).
The remuneration policy applicable to Martifer’ s management and supervisory bodies, approved in terms of Law 28/2009, as well
as the annual remuneration received by the members of the said bodies, in total and individually, are presented in the Corporate
Governance Report.
22. RELATED PARTIES
Beyond the balances and transactions described in the notes above, the balances or transactions performed with related parties
are as follows:
COSTS
FY 2015
REVENUES
FY 2014
FY 2015
ACCOUNTS RECEIVABLE
FY 2014
Shareholders
Group and associated companies
FY 2015
FY 2014
1,016,263
74,579
ACCOUNTS PAYABLE
FY 2015
FY 2014
1,610,355
628,192
1,709,297
2,314,495
298,607,746
339,211,336
30,171,448
24,957,222
1,610,355
628,192
1,709,297
2,314,495
299,624,009
339,285,915
30,171,448
24,957,222
Accounts receivable include supplementary capital amounts registered in financial investments. (see Note 11).
23. CASH RECEIVABLES / CASH PAYMENTS RELATED TO FINANCIAL
ASSETS
Cash receipts and cash payments related to financial assets in 2015 and 2014 are mainly due to supplementary capital (see Note 11).
24. SUBSEQUENT EVENTS
Since the reference date of the results, no facts that affect the released financial information occurred.
25. APPROVAL OF THE FINANCIAL STATEMENTS
th
These financial statements were approved by the Board of Directors on 6 April 2016. Additionally, the attached financial
statements are pending approval at the Shareholders General Meeting. However, the Board of Directors of the Company believes
these will be approved without significant alterations.
13
26. EXPLANATION ADDED FOR TRANSLATION OF THE FINANCIAL
STATEMENTS
These financial statements are a translation of the individual financial statements originally issued in Portuguese in accordance with
the International Financial Reporting Standards as adopted by the European Union. In the event of discrepancies, the Portuguese
version prevails.
th
The Chief Accountant
The Board of Directors
__________________________________
__________________________________
João Alexandre Queiroz Oliveira
(Chairman)
__________________________________
(Vice-Chairman)
__________________________________
__________________________________
__________________________________
__________________________________
I
CONTENTS
PART I
INFORMATION ON SHAREHOLDER STRUCTURE, ORGANISATION
AND CORPORATE GOVERNANCE
A. Shareholder Structure
B. Corporate Boards and Committees
C. Internal Organisation
D. Remuneration
E. Related Party Transactions
PART II
CORPORATE GOVERNANCE ASSESSMENT
ANNEXES
Annex I – Professional Qualifications
Annex II – Positions held and duties carried out by the members
of the Board of Directors
Annex III - Statement on the remuneration policy for 2015
This translation into English of the Portuguese document was made only for the convenience of non-Portuguese speaking shareholders. For all intents and
purposes, the Portuguese version shall prevail.
I
PART I
Information on shareholder structure, organisation
and corporate governance
A. SHAREHOLDER STRUCTURE
I. CAPITAL STRUCTURE
1. Capital Structure
The share capital of Martifer SGPS, S.A., Public Company (henceforth also referred to as ‘Company’ or Martifer’), amounts to €
50,000,000.00 (fifty million Euros), is fully subscribed and paid up and is represented by 100,000,000 (one hundred million)
nominative, scriptural shares, with a par value of € 0.50 (fifty cents) each.
All the shares are ordinary, no different categories of shares existing, nor rights and duties beyond those foreseen in law or in the
Company’s Articles of Association (henceforth also ‘Articles of Association’).
All the shares issued by Martifer have been admitted to trading on the Euronext Lisbon regulated market, corresponding to ISIN
Code PTMFR0AM0003, trading under the Mnemo Code MAR.
The itemized information on the distribution of share capital by the reference shareholders is present in Section 7, Part I of the
Corporate Governance Report.
2. Restrictions on transfer and ownership of shares
There are neither restrictions on the free transfer of the Company’s shares, nor shareholders holding special rights. Consequently,
all shares admitted to trading on the stock exchange are freely transmissible in accordance with the normal regulations applicable.
3. Own shares
During 2015, no transactions involving own shares occurred. Consequently, at 31 December 2015 the Company held, as it did in
2014, own shares totalling 2,215,910, representative of 2.22 % of its share capital. These shares correspond to 2.22% of the voting
rights of the Company.
4. Impact of changes in shareholder control over the Company on important agreements
Martifer neither celebrated nor is it part of any important agreement that comes into effect, is amended or terminates in the event of
a change in shareholder control over the Company due to a takeover bid.
Similarly, the Company has not adopted, via the approval of any statutory provisions or other measures adopted by the Company,
rules or regulations designed to prevent the success of takeover bids.
Likewise, there are no statutory provisions limiting the number of votes that can be held or exercised by a single shareholder,
individually or in conjunction with other shareholders.
I
5. Countermeasures in the event of changes in shareholder control
During the 2015 financial period, no countermeasures were adopted in the event of changes in shareholder control.
6. Shareholder Agreements that the Company is Aware of
th
The only shareholders agreement the company is aware of was celebrated on 28 May 2007 between I’M SGPS, S.A. (ex- MTO
nd
th
SGPS, S.A.) and Mota-Engil SGPS, S.A., and was changed by the amendments celebrated on 22 December 2009 and 17 April
2012.
st
The shares subject to the shareholders agreement, on 31 December 2015, are held by the referred shareholders in the following
amounts:
SHAREHOLDERS
NO. SHARES
PERCENTAGE
VOTING RIGHTS
Mota-Engil, SGPS, S.A.
37,500,000
37.50%
38.35%
I’M SGPS, S.A.
42,405,689
42.41%
43.37%
Total
79,905,689
79.91%
81.72%
The referred shareholders agreement regulates a few aspects of the company’s life, namely:
1. Imputing voting rights – The shareholders agree to exercise, on the company’s General Meeting, in a concerted way, their
voting rights regarding the matters for which the law demands the deliberation by the shareholders to be made by a qualified
majority.
2. Various provisions - At the request of anyone of them, the shareholders oblige themselves to deliberate changes in the
company’s articles of association, whenever they are needed to ensure, broadly, the execution of the provisions in the shareholders
agreement;
The shareholders commit, during the validity of the shareholders agreement, not to celebrate with other shareholders any
shareholders agreement; and
The shareholders agreement does not underlie any restrictions regarding share transfer.
3. Validity - The shareholders agreement will last for an undetermined period of time, but any of the shareholders can freely
terminate it with a minimum 30-day notice before the date the termination should take effect.
II. SHAREHOLDINGS AND BONDS HELD
7. Qualifying Holdings
At 31 December 2015, the main shareholders holders of qualifying holdings continued to be the companies I’M SGPS, S.A. and
Mota-Engil SGPS, S.A..
The directors of Martifer, Mr Carlos Manuel Marques Martins and Mr Jorge Alberto Marques Martins, are the majority shareholders
of the company I´M SGPS, S.A., holding, respectively, shares representing 48 % and 50 % of its share capital.
Mota-Engil SGPS, S.A.’s voting rights are held, pursuant to Article 20 of the Securities Code (Código de Valores Mobiliários CVM), by the company Mota-Engil, SGPS, SA.
To both these shareholders combined is imputed, at 31 December 2015, 82.38 % of the voting rights of the Company, under the
shareholder agreement in force at that date.
 CORPORATE GOVERNANCE REPORT  189
I
The 420,542 shares held by the shareholder Carlos Manuel Marques Martins are held on an indirect basis, under the household of
this Member of the Board of Directors of the Company, through the company BLACK AND BLUE INVESTMENTS, SA, of which that
Member is a minority shareholder.
The 230,260 and 3,000 shares held respectively by the shareholders and directors Jorge Alberto Marques Martins and Arnaldo
José Nunes da Costa Figueiredo are held on a direct basis.
st
On 31 December 2015, based on the information made available to the Company, the following entities were holders of qualifying
shareholdings, calculated in accordance with no. 1 of Article 20 of the Securities Code, in the share capital of the Company:
SHAREHOLDERS
NO. SHARES
I’M – SGPS, SA
Jorge Alberto Marques Martins*
% OF SHARE CAPITAL
% OF VOTING RIGHTS1
42,405,689
42.41%
43.37%
420,542
0.42%
0.43%
230,260
0.23%
0.24%
Total Imputable to I’M – SGPS, SA
43,056,491
43.06%
44.03%
Mota-Engil – SGPS, SA
37,500,000
37.50%
38.35%
Arnaldo José Nunes da Costa Figueiredo **
3,000
0.00%
0.00%
Luís Filipe Cardoso da Silva ** 2
2,000
0.00%
0.00%
37,503,000
37.50%
38.35%
3
Total Imputable to Mota-Engil , SGPS, SA
1
% Voting rights = No. Shares Held / (No. Total Shares – Own Shares)
Terminated his duties on 14th May 2015, following the election of the new governing bodies in the General Meeting which took place on that same date
3
Total Imputable on 31st December 2015, takes in consideration the termination of duties of the Board member Luís Filipe Cardoso da Silva on 14th
May 2015
* Member of a corporate body of I’M SGPS, SA; ** Member of a corporate body of Mota-Engil SGPS, SA
2
8. Number of shares and bonds held by members of the management and supervisory boards
(In accordance with the dispositions of no. 5 of Article 447 of the Portuguese Commercial Companies Code – “CCC”)
NAME OF THE MEMBER OF THE
CORPORATE BODY
CORPORATE BODY
SHARES HELD ON 31.12.2015
Board of Directors
420,542
Board of Directors
230,260
Board of Directors
0
Arnaldo Nunes da Costa Figueiredo
Board of Directors
3,000
Luís Filipe Cardoso da Silva **
Board of Directors
2,000
Luis António de Valadares Tavares
Board of Directors
0
Board of Directors
0
Manuel Simões de Carvalho e Silva **
Supervisory Board
0
João Carlos Ferreira de Carreto Lages **
Supervisory Board
0
Juvenal Pessoa Miranda **
Supervisory Board
0
Supervisory Board
0
Supervisory Board
0
Supervisory Board
0
Supervisory Board
0
*The 420,542 shares held by the shareholder Carlos Manuel Marques Martins are held on an indirect basis, under the household of this Member of
the Board of Directors of the Company, through the company BLACK AND BLUE INVESTMENTS, SA, of which that Member is a minority shareholder.
** Terminated his duties on 14th May 2015, following the election of the new governing bodies in the General Meeting which took place on that same date
Note: There are bonds held by members of the Board and supervisory bodies.
I
9. Special powers of the Board of Directors, namely in matters concerning resolutions
of capital increases
In accordance with the Articles of Association in force, the Board of Directors is authorised, having obtained a positive opinion from
the Supervisory Board and in compliance with the remaining provisions of the Company’s Articles of Association, to increase the company’s
share capital in cash, once or more than once, up to a maximum limit of one hundred and twenty-five million Euros. The Board of
Directors will set the terms and conditions of each capital increase, as well as the form and date/period of the subscription and realisation, as
set forth by Article 4, Number 8 of the Company Bylaws, as amended by the resolution approved on the General Meeting Assembly held on
May 25,2007.
Up till the present date, no capital increase has yet occurred pursuant to these powers attributed to the Board of Directors.
10. Significant Business Relationships between the Holders of Qualifying Holdings and the
Company
At 31 December 2015, the main shareholders holders of qualifying holdings continued to be the companies I’M SGPS, S.A. and
Mota-Engil SGPS, S.A..
During the 2015 financial period, no significant business or commercial transactions occurred between the Company and the
holders of qualifying holdings in the Company.
Regarding the business or transactions between holders of qualifying holdings in the Company and other Company affiliates fall
within the normal activities of these companies and were conducted under normal market conditions.
B. CORPORATE BOARDS AND COMMITTEES
I. GENERAL MEETING
a) Composition of the Presiding Board of the General Meeting
11. Details and position of the members of the Presiding Board of the General Meeting and
respective terms of office
The Board of the Shareholders’ General Meeting comprises a chairman, a vice chairman and a secretary; the present holders of
th
these positions having been elected at the 14 May 2015 Shareholders’ General Meeting, for a three-year term of office, ending on
st
31 December 2017.
The members of the Board of the Shareholders’ General Meeting are:
CHAIRMAN
José Joaquim Neiva Nunes de Oliveira
VICE CHAIRMAN
Luis Leitão Marques Vale Lima
SECRETARY
Luis Neiva de Oliveira Nunes de Oliveira
I
th
Up until the 14 May 2015 General Meeting, the board of the Shareholders’ General Meeting was composed by:
CHAIRMAN
José Carreto Lages
VICE CHAIRMAN
Francisco Artur dos Prazeres Ferreira da Silva
SECRETARY
Ana Maria Tavares Mendes
12. Restrictions on the right to vote
The Company Articles of Association do not establish any percentage or maximum limit regarding the exercising of voting rights by
any shareholder. The Company has not issued preference shares without voting rights.
The Shareholders’ General Meeting is, therefore, comprised of shareholders holding Martifer shares, each share carrying one vote.
Shareholders can participate provided they hold shares, at the least, up to five days prior to the date set for the General Meeting,
and provided these shares are registered in their name in securities’ accounts.
Up to three days prior to the date set for the General Meeting, a certificate, issued by the relevant entity, shall be presented to the
Company as proof of ownership of the shares. In the event of suspension of the General Meeting, the Company does not require
the blockage of the shares for the full suspension period; instead, compliance with the ordinary notice period for the first meeting
suffices.
Shareholders may be represented at Shareholders’ General Meetings by way of a written proxy mandate addressed to the
Chairman of the General Meeting Board. Said mandate may also be sent by electronic mail in accordance with the respective
Shareholders’ General Meeting convening notice instructions.
Shareholders may also exercise their vote by correspondence on all matters subject to approval at the General Meeting.
The proposals to be submitted for approval at the General Meeting, as well as the other information necessary for the preparation
and participation at said meetings are made available to the shareholders up to 21 days prior to date of the General Meeting, at
Martifer’s registered office and in the Company’s Website. Such documentation can be consulted in the Company’s Website at
http://www.martifer.pt/. In addition to the Company’s Website, said documentation is also made available to shareholders, for
consultation, at the company’s registered office during working hours, as well as in the CMVM’s Information Disclosure System
(www.cmvm.pt), as from the date the convening notice is issued. The Company’s Website also discloses the minutes of the
General Meetings within five days following said meetings.
Martifer has been applying and implementing measures to promote and encourage shareholder participation in general meetings:
−
Postal vote;
−
Availability of proxy letters and voting ballots in the Company’s Website;
−
Disclosure in the Website, in Portuguese and English languages, of the general meeting convening notice, the different forms of
voting and the procedures to adopt for correspondence voting or for voting through a proxy;
−
Disclosure in the Website, in Portuguese and English languages, of the preparatory documentation relating to the various points
on the Agenda;
−
The creation of an internet email address, publicised in the convening notice, exclusively dedicated to the general meeting, in
order to facilitate the clarification of any doubts.
I
13. Details of the maximum percentage of voting rights that may be exercised by a single
shareholder or by shareholders that are in any relationship as set out in no. 1 of Article 20
There is no restriction on the number of votes that can be held or exercised by a single shareholder or group of shareholders.
14. Shareholders' resolutions that, imposed by the articles of association, may only be
taken with a qualified majority
Article 18 of the Company’s Articles of Association establishes both for a first or second call notice, the rule of a simple majority of
the votes issued to pass resolutions, unless otherwise foreseen in the CCC or in the Articles of Association.
The only exception to this rule relates to the provision in the Company’s Articles of Association that sets a qualified majority of twothirds of the votes counted for the passing of resolutions relating to the unfair dismissal of directors.
II. MANAGEMENT AND SUPERVISION
a) Composition
15. Details of the corporate governance model adopted
Martifer’s corporate governance structure comprises a Board of Directors, a Supervisory Board and a Statutory Auditor, all elected
at Shareholders’ General Meetings. For the term of office corresponding to the triennium 2015-2017, the Board of Directors
delegated powers governing the day-to-day affairs of the Company to an Executive Committee, under the terms and within the
limits defined in Point 21.1 below.
The members comprising the corporate bodies, the General Meeting Board and the Remuneration Setting Committee were elected
for a triennium (2012-2014). The Remuneration Setting Committee, elected at a Shareholders’ General Meeting, is responsible for
setting the remuneration of the members of the Company’s corporate bodies as well as for defining the general guidelines to be
observed in objectively setting the amounts.
16. Articles of association rules on the procedural and material requirements governing the
appointment and replacement of members of the Board of Directors
The members of the Board of Directors are proposed and elected every third year by the Shareholders at a Shareholders’ General
Meeting or co-opted by the Board of Directors, subject to ratification at the General Meeting, their re-election being permitted once
or more than once.
In accordance with the Articles of Association, a member of the management board may be designated by a minimum number of
Shareholders, holding at least 10% of the share capital, who voted against the proposal to elect the directors passed.
The Board of Directors designates the Chairman and Vice Chairman from amongst its members and, to the extent it considers
pertinent and appropriate, constitutes an Executive Committee or delegates powers to executive directors.
The substitution of directors is made as set forth in Article 393 of the CCC. In accordance with the Company’s Articles of Association,
for the purposes of substituting directors under no. 1 of said Article of the CCC, absence is qualified as permanent when, without
acceptable justification to the management body, a director is absent from more than five meetings, consecutive or not.
I
17. Composition of the Board of Directors
In accordance with the Company’s Articles of Association, Martifer’s Board of Directors is composed of 5 to 9 members, elected at
a General Meeting.
The term of office of the members nominated to the Board of Directors is 3 calendar years and there are no restrictions regarding
their re-election. The members of the Board of Directors are considered vested as soon as they are elected and remain in office
until replaced by newly elected directors.
At 31 December 2015, the Board of Directors was composed of 6 members, elected at the Company’s General Meeting for a three
calendar year term of office, ending on 31 December 2017.
At 31 December 2015, the composition of the Board of Directors for the 2015-2017 term of office was as follows:
NAME OF DIRECTOR
FIRST NOMINATION
END OF CURRENT TERM OF OFFICE
Carlos Manuel Marques Martins (Chairman of the BD)
2004
2017
Jorge Alberto Marques Martins (Vice Chairman)
2004
2017
2015
2017
2010
2017
Luis Filipe Cardoso da Silva *
2010
-
Luis António de Castro de Valadares Tavares
2008
2017
2008
2017
*Terminated his duties on 14th May 2015, following the election of the new governing bodies in the General Meeting which took place on that same date
18. Distinction between executive and non-executive members
STATUS
(Executive / Non-executive)
INDEPENDENT or NON- INDEPENDENT
Carlos Manuel Marques Martins (Chairman of the BD)
Executive
-
Jorge Alberto Marques Martins (Vice Chairman)
Executive
-
Executive
-
Non-executive
Non-independent
Luís Filipe Cardoso da Silva *
Non-executive
Non-independent
Luis António de Castro de Valadares Tavares
Non-executive
Independent
Non-executive
Independent
NAME OF DIRECTOR
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*Terminated his duties on 14 May 2015, following the election of the new governing bodies in the General Meeting which took place on that same date
At 31 December 2015, of the 6 directors on the Board of Directors, 3 are non-executive directors, whose duties are to monitor and
appraise the management of the Company by the executive directors, 2 of these 3 non-executive directors being independent directors.
Given the Company’s size and shareholder structure, the number of independent directors is considered adequate. To verify the
independence of the members of the Board of Directors, the criteria used is that foreseen in Article 414, no. 5 of the CCC, as well
as that established in Point 18.1 of Annex 1 of the 4/2104 Regulation of the CMVM and in Recommendation II. 1.7 Code of
Corporate Governance of the CMVM (2013).
I
19. Professional qualifications of the members of the Board of Directors
The experience and knowledge of the members of the Board of Directors is detailed in their curricula, presented in the document
attached to this report as Annex I; these attest, in a rigorous and specific manner, their ability to carry out the duties attributed to them.
20. Customary and meaningful family, professional or business relationships of members
of the Board of Directors with shareholders that are assigned qualifying holdings
The Chairman of the Board of Directors, Carlos Manuel Marques Martins and the Vice Chairman, Jorge Alberto Marques Martins,
both hold shares and voting rights in one of the major shareholders, I’M - SGPS, S.A.. The abovementioned Board Members are
brothers.
The non-executive director Arnaldo José Nunes da Costa Figueiredo exercises management functions in Mota-Engil Group
companies; Mota-Engil SGPS, S.A., Martifer’s other major shareholder, being the holding company of said Group.
The remaining Board Members have no kinship relations between them.
21. Organizational charts or flowcharts concerning the allocation of powers between the
various corporate boards, committees and/or departments within the Company, including
information on delegating powers, particularly as regards the delegation of the Company's
daily management
21.1 ORGANIZATIONAL CHART
GENERAL
MEETING
Remuneration
Setting Committee
STATUTORY
AUDITOR (ROC)
Board of Directors
Executive
Committee
Ethics and Conduct
Committee
Supervisory Board
Company Secretary
Corporate
Governance
Committee
Risk Committee
I
21.2 POWER DELEGATION
In accordance with the Articles of Association and under Article 407, no. 3 of the CCC, daily management powers were delegated
to an Executive Committee, positions now held by Messrs Carlos Manuel Marques Martins (President), Jorge Alberto Marques
Martins and Pedro Nuno Cardoso Abreu Moreira. Said executive directors are responsible for the execution of the strategic
decisions taken by the Board of Directors, as well as for the daily management of the holding company, whilst company managing
financial shareholdings, all within the scope of the powers delegated to them.
The duties delegated to the Executive Committee include the guidance afforded to the various Business Areas’ performance, as
well as the running of the corporate services, the supervision of all the business areas, the promotion of synergies between these,
the deployment of the resources necessary, the management of human and financial resources, the definition of the strategies for
each business area and the supervision of the attainment of the objectives of each business area, establishing policies transversal
to the Company as a whole. It is also the Executive Committee’s duty to exercise the powers that, at any moment, have been
delegated to it by resolution of the Board of Directors, except over matters for which the delegation of powers is forbidden by law or
by the Articles of Association.
According to the Board of Directors’ resolution dated 28 July 2015, the following powers and respective limits were delegated:
−
−
−
−
−
−
−
−
−
Subscription, acquisition or disposal of shareholdings in any companies;
−
Participation in Joint-Ventures and in Economic Interest European Groups and, additionally, celebration of consortium and
associative partnership contracts, incorporation or participation in any other forms of temporary or permanent associations of
companies and/or private or public entities, except when the said associations have as their objective projects involving turnover
in excess of one hundred million Euros;
−
Appointment of representatives to the general meetings of the companies in which Martifer – SGPS, S.A., Public Company, has
shareholdings and determination of voting intentions at said meetings;
−
Representation of the company in court and outside it, actively or passively, including the submission, opposition and appeal
regarding any legal or arbitration proceedings, including also the confession , withdrawal, or transactions extinguishing lawsuits
or pending issues and the acceptance of arbitration commitments; and
−
Appointment of proxies to carry out specific acts or categories of acts, defining the extent of the respective mandates.
Acquisition or disposal of real estate and other assets;
Investment or commitment to invest, excluding those involving new business areas;
Acquisition and disposal of own shares within the limits of the resolution of the Company’s General Meeting;
Investment and disinvestment foreseen in the annual budgets or, if not foreseen, which amount is below five million Euros;
Contracting of services;
Hiring of employees, defining levels, categories, remuneration conditions and other benefits or complements;
Exercising of disciplinary powers and applying sanctions;
Issuance of binding instructions to wholly controlled Martifer – SGPS, S.A. group companies, as defined in the Portuguese
Commercial Companies Code;
Pursuant to Article 407, no. 1 of the Portuguese Commercial Companies Code, the Board of Directors also attributed to Director
Pedro Nuno Cardoso Abreu Moreira the special charge of assuming responsibility for the Financial Area, as well as of Company
Representative vis-à-vis relations with the Market and with the CMVM.
Save for the matters that cannot be delegated by law pursuant to Article 407, nos. 4 and 8 of the CCC, the Board of Directors has
expressly stated that certain matters are excluded from the powers delegated to Executive Directors, namely the:
I. Approval of the activity plans and budgets for Martifer Group’s companies;
II. Investment or commitment to invest in new business areas;
III. Investment and disinvestment unforeseen in the annual budgets of Martifer Group’s companies, when the amounts involved
are equal or above five million euros
IV. Constitution of any liens and charges on Martifer Group’s companies’ social parties;
I
V. Participation in Joint-Ventures and in Economic Interest European Groups and, additionally, celebration of consortium and
associative partnership contracts, incorporation or participation in any other forms of temporary or permanent associations of
companies and/or private or public entities, except when the said associations have as their objective projects involving
turnover in excess of one hundred million Euros;
VI. Appointment of proxies, natural or legal, to hold social roles in other companies;
VII. Constitution of the Executive Committee as well as the definition of the matters to delegate to it.
The delegation of powers will cease with the passing of a resolution by the Board of Directors or, automatically, with the end of the
term of office of the Board of Directors that delegated said powers.
b) Functioning
22. Availability and place where rules on the functioning of the Board of Directors may be viewed
The Board of Directors’ Organisational and Functional Regulation is presented in Martifer’s Website at – www.martifer.pt (Tab:
Investors, Section: Corporate Governance/Articles of Association).
23. The number of meetings held and the attendance report for each member of the Board
of Directors
The Board of Directors meets regularly, once per quarter and, as defined in the Articles of Association and in the respective
Regulation, whenever the Chairman or two board members call a meeting; valid resolutions being passed with the attendance or
representation of a majority of its members.
Without prejudice to the above and considering the fact that the Chairman of the Board of Directors accumulates the position of
President of the Executive Committee, the Board of Directors’ Regulation sets forth that the non executive directors may, even so,
conduct meetings, when such meeting is called by a non-executive director on his own initiative or at the request of any two of
those directors, for the purposes of exercising their powers of monitoring, supervising and appraising the activity of the members to
whom the Board of Directors delegated powers.
To that end, and in order to safeguard the exercising, in an independent and informed manner, of the powers of the non-executive
directors referred to in the previous paragraph, the following mechanisms and procedures were instituted by the Board of Directors
and enshrined in its Regulation:
(i)
obligation to deliver to the directors sans delegated powers all the information considered necessary or convenient and that is
requested by them of the Company or of any of the directors with delegated powers;
(ii) the satisfaction of the requests of directors with no delegated powers shall be made in an appropriate and timely manner;
(iii) possibility of any non-executive director requesting the calling of meetings so that non-executive directors can exercise the
powers attributed to them; and
(iv) the specialised committees with monitoring, supervisory and appraisal competencies over the activities of the directors with
delegated powers shall be presided and largely composed of directors with no delegated powers.
During the 2015 financial year, no constraints were detected regarding the management and operations of the Company; it can
therefore be considered that the mechanism that assures the coordination of the work of the non-executive directors is safeguarded.
In 2015, the Board of Directors met fourteen times. The minutes are written up and signed by the Directors and the Company
Secretary and recorded in the respective minute book, with copies also being sent to the Chairman of the Supervisory Board.
I
The attendance level of each Director at said meetings, in the conduct of his respective duties, was as follows:
NAME OF DIRECTOR
ATTENDANCE
Carlos Manuel Marques Martins (Chairman of the BD)*
93%
Jorge Alberto Marques Martins (Vice Chairman)*
50%
100%
Arnaldo José Nunes da Costa Figueiredo*
86%
Luis Filipe Cardoso da Silva * **
75%
Luis António de Castro de Valadares Tavares *
43%
Jorge Bento Ribeiro Barbosa Farinha*
43%
* The director justified his absence and was represented by another director at the respective meeting, as per proxy letter issued to the effect.
** Terminated his duties on 14th May 2015, following the election of the new governing bodies in the General Meeting which took place on that same date
24. Competent Corporate Boards undertaking the performance appraisal of executive directors
The Company’s Corporate Governance Committee is composed of non-executive members of the Company’s Board of Directors
and presided over by an independent director that meets all the independence and compatibility requirements foreseen in Point
18.1 of Annex I of the 4/2013 Regulation of the CMVM and in Recommendation II.1.7 of the CMVM (2013). This Committee has,
amongst others, the power to appraise the performance of the executive directors and the overall performance of the Board of
Directors, as well as that of the various committees in existence.
The Company’s Remuneration Committee also undertakes, within its scope of powers, the performance appraisal of the members
of the Board of Directors, endeavouring towards a convergence of the interests of the directors, the remaining corporate bodies and
the managers with the interests of the Company, promoting a long-term perspective.
25. Predefined criteria for assessing executive directors' performance
Directors’ performance is appraised based on the principles listed in the Remuneration Policy Statement. The remuneration policy
and the remuneration of the Company’s Corporate Bodies is reviewed annually and submitted for approval at the Company’s
Annual Shareholders’ General Meeting.
The remuneration policy is oriented along principles and criteria based on the duties carried out, the degree of complexity and
responsibility assumed, the alignment of the interests of the management board members with the interests of the company, the
performance appraisal, the economic situation of the company and general market conditions for equivalent situations, as better set
out in Point 70 below.
26. The availability of each member of the Board of Directors and details of the positions held
at the same time in other companies, within and outside the group, and other relevant
activities undertaken by members of this Board throughout the financial year
The indication and description of the positions held and duties carried out by the members of the Board of Directors are better
described in the document attached to the present report as Annex II.
The company considers that all the members of the Board of Directors have shown total availability to perform the duties decurring
from the bodies to which they were elected to by the shareholders. Considering, on the one hand, the board members’ availability to
participate in the meetings of the bodies they are a part of (Board of Directors, Risk Committee Ethics and Conduct Committee and
Corporate Governance Committee) and, on the other hand, the total availability to perform the tasks attributed to them by the board
of directors, regarding both their areas of work and the management responsibilities in given business areas.
I
c) Committees within the Board of Directors or Supervisory Board and Board Delegates
27. Details of the Committees created within the Board of Directors and the place where the
rules on the functioning thereof are available
With the aim of adopting the best corporate governance practices, the Board of Directors nominated 3 (three) specialised
committees to boost its operational effectiveness.
BOARD OF
DIRECTORS
COMPANY SECRETARY
Corporate Governance
Committee
Ethics and Conduct
Committee
Risk Committee
The Corporate Governance, Ethics and Conduct and the Risk Committees have their own regulations that lay down the rules
relating to their composition, functioning and powers, which can be consulted in the Company’s Website at http://www.martifer.pt/
(Tab: Investors, Section: Corporate Governance/Articles of Association).
28. Details of the Executive Committee’s Members
The Board Members nominated by the Company’s Board of Directors to be a part of the Executive Committee are:
- Carlos Manuel Marques Martins;
- Jorge Alberto Marques Martins;
- Pedro Nuno Cardoso Abreu Moreira
The powers delegated to the Executive Committee are set down in Point 21.2 above.
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29. Description of the powers of each of the committees established and a summary of
activities undertaken in exercising said powers
CORPORATE GOVERNANCE COMMITTEE
The Corporate Governance Committee shall, as per the respective Regulation, be composed of 2 to 6 members that are also
members of the Supervisory Board and/or Board of Directors, but that do not exercise executive functions. Presently, the Corporate
Governance Committee has the following composition:
PRESIDENT
Mr. Jorge Bento Farinha (Independent, non-executive Director)
MEMBERS
Mr. Luis Valadares Tavares (Independent, non-executive Director)
Mr. Américo Pereira (President of the Supervisory Board)
The Corporate Governance Committee has the power to issue suggestions for the improvement of Martifer’s Corporate Governance Model,
with the purpose of promoting the compliance with rigorous ethical and deontological principles and the observance of practices which
assure compliance with the norms and established corporate governance best practices that sustain a diligent, effective, balanced, ethical
conduct and responsibility promoting management, from the perspective of the interests of the shareholders and other stakeholders.
Other than the presence of its members in informal meetings and in work groups, the Corporate Governance Committee met
formally twice in 2015. This Committee records the minutes of its meetings.
The Corporate Governance Committee has its own Regulation, which lays down the rules regarding its composition, functioning
and powers, which can be consulted in the company’s Website at http://www.martifer.pt/ (Tab: Investors, Section: Corporate
Governance/Articles of Association and Regulations).
The Corporate Governance Committee has as its main responsibilities and powers to:
−
−
−
−
evaluate and develop the corporate governance model;
reflect on the governance system adopted and verify its effectiveness;
advise and propose to the Company’s relevant corporate bodies the promotion of measures aimed at improving Corporate
Governance;
undertake performance appraisals of the executive directors and of the Board of Directors as a whole, as well as of the other
Committees in existence.
ETHICS AND CONDUCT COMMITTEE
The Ethics and Conduct Committee is composed of three to seven members, nominated by the Board of Directors, which also
designates the President. Presently, the Ethics and Conduct Committee has the following composition:
PRESIDENT
Mr. Luis Valadares Tavares (Independent, non-executive Director)
MEMBERS
Mr. Carlos Eduardo Gil (Martifer’s Corporate Legal Department Manager); and
Mr. Paulo César Ferreira (Martifer’s Corporate Planning and Control Manager)
The Ethics and Conduct Committee has its own Regulation, which lays down the rules relating to its composition, functioning and
powers regarding the elaboration, implementation, monitoring and control of ethics and conduct norms at the Martifer Group. The
Ethics and Conduct Committee Regulation can be consulted in the Company’s Website at http://www.martifer.pt/ (Tab: Investors,
Section: Corporate Governance/Articles of Association).
I
The Ethics and Conduct Committee is also responsible for constituting and assuring compliance with the irregularities disclosure policy
regarding irregularities occurring inside the Martifer Group, under which employees can communicate, in an adequate, immediate and
confidential (if requested) manner whilst safeguarding their professional integrity, information relating to the denunciation of irregularities
occurring within Martifer, establishing and publicizing the most adequate and effective communication channels for this purpose.
The Ethics and Conduct Committee coordinates its activity with the company’s Supervisory Board, given the specific powers resting
with that board, namely those laid down in the CCC.
The Committee meets periodically or whenever it is called by its President, by convening notice sent by the President to its
members with a minimum notice period of seven working days, which will also indicate the respective agenda. The Ethics and
Conduct Committee writes up minutes of all its meetings.
In addition to the informal meetings and to the presence of its members in workgroups, the Ethics and Conduct Committee met
formally twice in 2015. This Committee records the minutes of its meetings.
RISK COMMITTEE
The Risk Committee is composed of three to six members that integrate the Board of Directors and/or the Supervisory Board, but
the majority of the members cannot hold executive functions. The Chairman of the Company’s Board of Directors may not form part of
the Risk Committee, but may participate in the meetings, without the right to vote. The Risk Committee has the following composition:
PRESIDENT
Mr. Jorge Bento Farinha (Independent, non-executive Director)
VICE PRESIDENT
Mr. Américo Pereira (President of the Supervisory Board)
MEMBER
Mr. Pedro Nuno Cardoso Abreu Moreira (Member of the Executive Committee)
The Risk Committee has its own Regulation, which lays down the rules relating to its composition, functioning and powers regarding
the preparation, implementation and monitoring of a risk management system transversal to the Martifer Group. The Risk Committee
Regulation can be consulted in the company’s Website at http://www.martifer.pt/ (Tab: Investors, Section: Corporate
Governance/Articles of Association).
The mission of the Risk Committee is to propose and monitor the implementation of the Martifer Group’s risk management policy,
which aims to establish a strategy for the prevention and management of risk transversal to the Martifer Group, so as to reduce the
exposure to risk and safeguard the Groups’ worth and the creation of value for its stakeholders.
The main responsibilities attributed to the Risk Committee are to:
−
−
−
−
−
−
issue recommendations or opinions as to: (a) the definition of a risk policy for Martifer Group; (b) the content, format and
methodologies to consider in investment analysis reports, be they organic or of company acquisitions; and (c) the creation of
risk identification, monitoring, control and management systems of a (i) legal and contractual, (ii) financial, (iii) technical and
operational, (iv) commercial, (v) environmental, (vi) political and (vii) other nature, that the Risk Committee considers relevant;
ensure compliance with the guiding principles of the Martifer Group Risk policy, assisting the Board of Directors with the setting
of the strategic objectives of the company in matters of risk assumption;
prepare opinions on financing operations and investments that require the prior opinion of the Risk Committee;
submit to the Board of Directors proposals and suggestions of methodologies to identify and cover risks that are appropriate and
that should be adopted by Martifer Group as measures aimed at improving the risk management model in place and to facilitate
the pursuit of higher corporate objectives;
inform the Board of Directors of any situation or occurrence of which it has become aware that, in its opinion, configures noncompliance with the Risk identification, monitoring and control rules and practices; and
monitor and analyse the reflections and guidance produced on risk management by national and international organisms, so as
to take advantage of these to improve the Martifer Group Risk Management model.
In addition to the informal meetings and the presence of its members in work groups, the Risk Committee met formally for 2 times
during 2015.
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III. SUPERVISION
a) Composition
30. Details of the Supervisory Board
Martifer’s supervisory model is based on a Supervisory Board and a Statutory Auditor (ROC). The functional separation between
the Supervisory Board and the Statutory Auditor basically follows a division of the functions into two: the political supervision being
exercised by the Supervisory Board, with the review and certification of the financial statements resting with the Statutory Auditor.
31. Composition of the Supervisory Board with details of the articles of association’s minimum
and maximum number of members, duration of the term of office, number of effective
members, date of first appointment and date of end of the term of office for each member
th
The Company’s Supervisory Board is composed of three effective members and an alternate member, elected on the 14 May
2015 General Meeting, for the triennium 2015-2017, re-electable as permitted by law.
The members of the Supervisory Board may only be elected, as a rule, at the Shareholders’ General Meeting and, in the event of a
vacancy in the Supervisory Board, such vacancy shall be filled by the alternate member. If another vacancy occurs, such vacancy
can only be filled through the election of a new member at a Shareholders’ General Meeting.
The members, Mr. Américo Agostinho Martins Pereira (President), Mr. Paulo Sérgio Jesus das Neves (Member) and Mr. António
Baia Engana (Alternate) were appointed for the first mandate in 2015, ending the current mandate in 2017. The member Mr. Carlos
Alberto da Silva e Cunha (Member) was appointed for the first mandate in 2008, ending his current and third mandate in 2017.
32. Details of the members of the Supervisory Board
Currently, Martifer’s Supervisory Board has the following composition:
PRESIDENT
Mr. Américo Agostinho Martins Pereira
MEMBERS
Mr. Carlos Alberto da Silva e Cunha
Mr. Paulo Sérgio Jesus das Neves
ALTERNATE
Mr. António Baia Engana
Up until the Shareholders’ General Meeting on 14th May 2015, inclusive, Martifer’s Supervisory Board had the following
composition:
PRESIDENT
Mr. Manuel Simões de Carvalho e Silva
MEMBERS
Mr. João Carlos Tavares Ferreira de Carreto Lages
ALTERNATE
Mr. Juvenal Pessoa Miranda
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33. Professional qualifications of each member of the Supervisory Board and other
important curricular information
The experience and knowledge of the current members of the Supervisory Board are better described in their curricula presented in the
document attached to this report and attest, in a rigorous and specific manner, their ability to carry out the duties attributed to them.
The Company’s Supervisory Board is composed of independent members, who are subject to the legal and regulatory requirements
regarding incompatibility, independence, and specialisation in force, namely those foreseen in Article 414-A of the CCC, as well as
the independence criteria referred to in no. 5 of Article 414 of the CCC.
The members comprising the Supervisory Board meet the incompatibility and independence criteria identified above with, at 31
December 2015, none of the members holding Martifer shares, in compliance with Article 447 of the CCC.
b) Functioning
34. Availability and place where the rules on the functioning of the Supervisory Board may
be viewed
The Supervisory Board’s powers are described in its respective Regulation, which can be consulted in the company’s Website at
http://www.martifer.pt/ (Tab: Investors, Section: Corporate Governance/Articles of Association).
35. The number of meetings held and the attendance report for each member of the
Supervisory Board
The Supervisory Board meets, at the minimum, once a quarter, whenever its President decides or whenever any of the members
request he call a meeting. The President is responsible for calling and running the meetings. Resolutions are passed when the
majority of the members are present and by a simple majority of the votes expressed.
In 2015, the Supervisory Board met 7 times, minutes being prepared of all the meetings.
The attendance level of each Member at said meetings, in the conduct of his respective duties, was as follows:
ATTENDANCE
Mr. Manuel Simões de Carvalho e Silva *
100%
Mr. João Carlos Tavares Ferreira de Carreto Lages*
100%
Mr. Américo Agostinho Martins Pereira
100%
100%
Mr. Paulo Sérgio Jesus das Neves
100%
th
* Terminated his duties on 14 May 2015, following the election of the new governing bodies in the General Meeting which took place on that same date
I
36. The availability of each member of the Supervisory Board, indicating the positions held
simultaneously in other companies, inside and outside the Group, and other relevant
activities undertaken
All the members of the Supervisory Board demonstrated throughout the 2015 financial year full availability to exercise the functions
attributed to them, having regularly attended meetings called as well as being present whenever such presence was considered convenient.
In so far as the activities of the members of the Supervisory Board are concerned, all the members of the Supervisory Board are
statutory auditors and develop their activity in different entities, as described in the curricula presented in the annexes of this report,
endowing this board with important operational knowledge of the Company’s business areas.
The President is adequately supported by the remaining members of the Supervisory Board.
Within the scope of the most relevant activities of the members of the Supervisory Council we refer to the information contained in
Point 33.
c) Powers and duties
37. Description of the procedures and criteria applicable to the supervisory body for the
purposes of hiring additional services from the external auditor
The Company’s External Auditor has been the company PricewaterhouseCoopers & Associados, SROC, SA (PwC) since the 2010
financial period. The change in External Auditors followed a market consultation that year, which was the object of analysis and
assessment by the Supervisory Board.
Services falling outside the statutory and external audit scope requested by Martifer Group companies from the External Auditor
and from other entities belonging to the same network, in 2015, do not attain relevant amounts. The Supervisory Board approved
the engagement of services outside the scope of the statutory and external audit from the External Auditor, considering that these
services, in addition to not exceeding a relative weight in excess of 30% of the total services rendered to the Company, do not
impair the External Auditors’ independence.
Additionally, any new service to be rendered by PwC and its companies (national or international) to the Martifer Group is subject to
the prior approval of both the management of Martifer and the PwC Partner responsible for the PwC work at the Martifer Group,
within the scope of its quality control system.
Martifer’s Supervisory Board, within the scope of its supervisory duties vis-à-vis the company’s activity, has analytical and appraisal
responsibilities over the more significant aspects of the relationship with the External Auditor, namely in aspects relating to the
independence of its work. During 2015, the Company’s Supervisory Board appraised the activity carried out by the External Auditor,
having concluded that it was conducted in a manner consistent with applicable regulations and norms, and that it had acted with
technical rigor, transparency and elegance.
The Supervisory Board furthermore reflects, whenever necessary or adequate in function of developments at the Company or the
market configuration in general, on the adequacy of the External Auditor vis-à-vis the performance of the duties attributed to it.
38. Other duties of the supervisory body
In addition to the duties described in the previous point, the Supervisory Board has the powers set forth in law and in the Articles of
Association, amongst others, those relating to the monitoring of the Company’s operations, the compliance with the applicable
legislation, Articles of Association and regulations, as well as to issue opinions on the budget, the balance sheet, the inventories
and the annual financial statements.
I
Hence, in exercising its powers and carrying out its duties, the Supervisory Board proposes to the General Meeting:
−
−
Nominates the Company’s effective and alternate Statutory Auditors;
−
−
−
−
−
−
Examines, whenever it considers convenient and with regularity, the Company's bookkeeping;
Monitors the Statutory Auditors’ independence, namely in respect of the rendering of additional services and the scope of these,
and in respect of the statutory audit of the Company’s financial statements;
Monitors the Company’s activity and compliance with the applicable laws, Articles of Association and regulations;
Represents or arranges to represent itself at the Board of Directors’ meetings whenever it considers such presence convenient;
Requests the call of the Shareholders’ General Meeting whenever it considers such call convenient;
Examines situations periodically presented to it by the Board of Directors during its term of office;
Issues opinions on the budget, the balance sheet, the inventories and the annual accounts.
The Supervisory Board is also responsible for representing the Company vis-à-vis the External Auditor, and for:
−
−
−
proposing the supplier of these services and the respective remuneration;
−
proposing the destitution of the External Auditor with just cause.
ensuring that conditions adequate for the rendering of these services are made available at the Company;
annually appraising the services rendered as well as for acting as the Company’s go-between, receiving, simultaneously with
the Board of Directors, the respective reports; and
Finally, Martifer’s Supervisory Board is responsible for inspecting and assessing the effectiveness of the risk management systems
and monitoring of the activity of internal audit, including the functioning of the systems of internal control and risk management, both
the object of regular monitoring and evaluation by the Supervisory Board within the scope of its functional and legal powers, as can
be inferred from the minutes of the meetings and the annual report and opinion issued by the Supervisory Board.
IV. STATUTORY AUDITOR
39. Details of the statutory auditor and the partner that represents same
th
The Statutory Auditors, effective and alternate, were elected for the triennium 2015-2017 at the 14 May 2015 General Meeting,
following the resignation on 25 February 2013 of the Statutory Auditor and of the respective alternate, are:
PRESIDENT
PRICEWATERHOUSECOOPERS & Associados – Sociedade de Revisores Oficiais de Contas, Lda.,
Statutory Auditor (effective)
ALTERNATE
Mr JOSÉ PEREIRA ALVES, Statuary Auditor (alternate)
The Statutory Auditor can only be elected at a General Meeting. If a vacancy occurs in this body it shall be filled by the alternate
member, and, if the latter does not remain in that function, it can only be filled through the election of a new member at a
Shareholders’ General Meeting.
The Statutory Auditor may be represented by Hermínio António Paulos Afonso or by António Joaquim Brochado Correia, it being
understood that for the 2015 financial year the representative of the Statutory Auditor was Hermínio António Paulos Afonso.
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40. Indication of the number of years that the statutory auditor consecutively carries out
duties at the company and/or group
As better described in the previous point, the current Statutory Auditor, PricewaterhouseCoopers & Associados, SROC, Lda, was
appointed at the General Meeting of 10 April 2013, carrying out its duties since then.
41. Description of other services that the statutory auditor provides to the company
The Statutory Auditor also provides the Company with External Audit services, as described in the follow points that.
V. EXTERNAL AUDITOR
42. Details of the external auditor appointed in accordance with Article 8 and of the partner
that represents same in carrying out these duties, and the respective registration number at
the CMVM
The Company’s External Auditor is the company PricewaterhouseCoopers & Associados, SROC, SA (PwC) registered under no.
9077 at the Comissão de Mercado de Valores Mobiliários (CMVM), pursuant to a contract initially celebrated for that financial year,
and which has been extended to the 2015 financial year.
PwC has, since 2010, been represented by Mr Hermínio António Paulos Afonso.
43. Indication of the number of years that the external auditor and respective partner that
represents same in carrying out these duties have consecutively carried out duties at the
company and/or group
As better described in the previous point, the External Auditor, PricewaterhouseCoopers & Associados, SROC, Lda. and the
respective statutory auditor partner representing the prior in the conduct of its duties, have exercised said duties consecutively at
the Company since 2010, i.e. around 5 years.
44. Rotation policy and schedule of the external auditor and the respective partner that
represents said auditor in carrying out such duties
In so far as a rotation schedule of the External Auditor is concerned, the Martifer Group has no formal policy regarding External
Auditor rotation.
The Supervisory Board carries out an annual assessment of the External Auditor’s work, ensuring compliance with those laid down
in Article 54 of Decree-law no. 487/99, of 16 November (amended by Decree-law no. 224/2008, of 20 November), relating to the
rotation of the partner responsible for the execution of the work.
Nevertheless, both the External Auditor and its partner, a Statutory Auditor representing it in the carrying out of said duties, are still
in a second term of office in the Company, and therefore complying with the rules presently in force.
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45. Details of the Board responsible for assessing the external auditor and the regular
intervals when said assessment is carried out
The Supervisory Board, in the conduct of its functions, carries out an annual assessment of the External Auditor’s independence.
Additionally, the Supervisory Board, throughout each financial period and whenever necessary or adequate in function of
developments in the activity of the Company or the general market configuration, reflects on the adequacy of the External Auditor
vis-à-vis the conduct of its duties.
46. Details of services, other than auditing, carried out by the External Auditor for the
Company and/or companies in a control relationship and an indication of the internal
procedures for approving the recruitment of such services and a statement on the reasons
for said recruitment
In addition to auditing services, tax advisory services in respect of foreign companies and a due diligence in respect of an affiliate
were carried out for the Company and/or the Group’s companies.
The approval and recruitment of the services rendered by the External Auditor, other than the auditing services, was based on the
procedures described in Point 37, it being understood that said recruitment occurred due to the lack of internal resources at the
relevant company.
The Supervisory Board approved the engagement of services outside the scope of the statutory and external audit from the
External Auditor, considering that these services, in addition to not exceeding a relative weight in excess of 30% of the total
services rendered to the Company, do not impair the External Auditors’ independence.
Additionally, any new service to be rendered by PwC and its companies (national or international) to the Martifer Group is subject to
the prior approval of both the management of Martifer and the PwC Partner responsible for the PwC work at the Martifer Group,
within the scope of Martifer’ s quality control system.
47. Details of the annual remuneration paid by the Company and/or legal entities in a
control or group relationship to the auditor and other natural or legal persons pertaining to
the same network and the percentage breakdown relating to the services in question
During the 2015 financial period, the annual remuneration paid to the auditors and other private or corporate bodies belonging to
the same network, borne by the Company and / or legal entities in a control or group relationship, amounted to 369,924 thousand
Euros (including expenses and remuneration paid by foreign subsidiaries). The breakdown of that remuneration is as follows:
OTHER
Statutory and external audit services
2015
%
2014
%
2013
%
295,769
90.11%
305,485
99.00%
365,508
90.68%
0
0.00%
0
0.00%
0
0.00%
Tax advisory services
14,495
4.42%
3,065
1.00%
34,506
8.56%
Other services outside the statutory audit scope
17,940
0.00%
0
0.00%
3,074
0.76%
328,204
100.00%
Other due diligence / verification services
Total
308,550
100.00%
403,088
100.00%
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MT SGPS
Statutory and external audit services
2015
41,720
%
100.00%
2014
41,720
%
100.00%
2013
41,720
%
100.00%
Other due diligence / verification services
0
0.00%
0.00%
0.00%
Tax advisory services
0
0.00%
0.00%
0.00%
Other services outside the statutory audit scope
Total
GLOBAL TOTAL
0
41,720
369,924
0.00%
100.00%
0.00%
41,720
350,270
10.35%
0.00%
41,720
100.00%
444,808
** Including individual and consolidated accounts
C. INTERNAL ORGANISATION
I. ARTICLES OF ASSOCIATION
48. Rules governing amendment to the Articles of Association (Article 245-A/1/h))
Martifer’s Articles of Association do not contain special rules regulating amendments to the same; being, thus, applicable the rules
laid down in the CCC. Hence:
−
Constitutive quorum: the provisions laid down in Article 383 of the CCC apply. At a first meeting, for a Shareholders’ General
Meeting to pass resolutions on amendments to the Company’s Articles of Association, the presence, or representation, of
shareholders holding at least one third of the company’s share capital is required;
−
Deliberative quorum: the provisions laid down in Article 18 of the Articles of Association and Article 386, no. 3 of the CCC apply,
namely, corporate resolutions in a Shareholders’ General Meeting as to amendments to the Articles of Association are taken, at
a first or second meeting, by two thirds of the votes issued.
II. REPORTING OF IRREGULARITIES
49. Reporting means and policy on the reporting of irregularities in the company
The policy on the reporting of irregularities defines the Ethics and Conduct Committee as the entity responsible for the reception and
management of denunciations or reports of irregularities, without prejudice to the Supervisory Board’s own powers in this matter.
In complement to the Supervisory Board, the Committee pursues, applies and follows up on the procedures underlying the
denunciation of internal irregularities, affording the appropriate internal treatment to the denunciations and reporting of irregularities
and ensuring the rapid resolution of the facts denounced.
In this manner, Martifer Group seeks to create conditions that allow any employee to freely report his concerns on these matters to
the Ethics and Conduct Committee and to facilitate the early detection of irregular situations that, being practiced, could damage the
Martifer Group, as well as its stakeholders.
Any notification, reporting or denunciation of irregularities occurring internally at the Martifer Group is forwarded directly in a special
mail box, which can be accessed solely by the President of the Ethics and Conduct Committee. The anonymity and confidentiality
are assured whenever so requested in the report or denunciation. This channel was considered the most appropriate and
independent means for the reception of denunciations, without prejudice to those being received through the post.
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The direct reporting of irregularities to the Supervisory Board, and all those that are of the exclusive competence of the Supervisory
Board, are likewise immediately reported to that body’s President by the President of the Ethics and Conduct Committee.
During 2015, no irregularities were reported to the Martifer Group’s Ethics and Conduct Committee.
The Company’s reporting and denunciation of irregularities policy is disclosed in the Company’s Website at http://www.martifer.pt/,
as well as in the Company’s intranet site.
Martifer’s reporting of irregularities policy applies to the entire Martifer Group perimeter.
III. INTERNAL CONTROL AND RISK MANAGEMENT
50. Individuals, boards or committees responsible for the internal audit and / or
implementation of the internal control systems
Board of Directors
The risk policy is defined by the Board of Directors based on the analysis and measurement of risk, which also coordinates and
develops risk management processes so as to guarantee an integrated risk management streamlined with the strategy and
objectives of the Martifer Group.
Risk Committee
Martifer’s Risk Committee, which constitutes a Specialised Committee at the service of the Board of Directors, has as its main
attributions the compliance with the guiding principles subjacent to Martifer Group Risk policy, aiding the Board of Directors with the
setting of the Company’s strategic objectives in matters pertaining to the assumption of risk, issuing recommendations and
opinions, amongst others, on the definition of a Risk Policy for the Martifer Group and as to the creation of risk identification,
monitoring, control and management systems of a (i) legal and contractual, (ii) financial, (iii) technical and operational, (iv)
commercial, (v) environmental, (vi) political and (vii) other nature.
The composition, functioning, attributions and powers of the Risk Committee are described in Point 29 above, and can be consulted
in the Company’s Website at http://www.martifer.pt/ (Tab: Investors, Section: Corporate Governance / Articles of Association).
Supervisory Board
The assessment of the risk management and control systems constitutes a matter which is the object of regular analysis and
discussion by Martifer’s Supervisory Board, within the scope of the framework of its legal powers.
External Audit
As part of its duties it evaluates the risks subjacent to the reliability and integrity of the accounting and financial information,
reporting on same to the Supervisory Board.
Internal Audit Department
Martifer has in its organisational structure an Internal Audit Department that carries out its activities with the purpose of assessing
the effectiveness and efficiency of the internal control system and of the business processes throughout the Martifer Group, in an
independent and systematic manner, that verifies whether the assets at Martifer Group level are duly recorded and sufficiently
protected against risks and losses, that examines and evaluates the accuracy, the quality and the application of operational,
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accounting and financial controls, promoting effective control at a reasonable cost and proposing measures that reveal themselves
to be necessary to overcome potential weaknesses detected in the internal control systems.
Martifer’s internal audit department reports functionally to Mr. Jorge Bento Ribeiro Barbosa Farinha, a non-executive, independent
director sitting on the Company’s Board of Directors.
The scope of the audits to be conducted in order to assess the quality of the control processes that assure compliance with the
objectives of the Internal Control System, namely those that guarantee the efficiency of the operations, the reliability of the financial
and operational reports and the respect for the law and regulations, is defined annually. Internal control deficiencies are reported up
the hierarchy, the gravest matters being reported directly to the Board of Directors.
The activities of the Internal Audit Department, including the functioning of the internal control and risk management systems, are
regularly monitored by the Company’s Supervisory Board whilst supervisory body, within the scope of its functional powers, namely
those foreseen in paragraph i) of Article 420 of the CCC. It should be pointed out that the Company’s Supervisory Board meets
regularly, fully complying with all its duties and attributions, as can be inferred from the minutes of the meetings and from the
Supervisory Board’s annual report and opinion.
During 2015, due to the exit of some employees from the internal audit department, its activity was significantly reduced. However,
the company is currently taking active measures to, throughout 2016, endow the internal audit department with the resources
needed to fully comply with the roles attributed to it as an integral part of the Group’s organizational structure.
Planning and Management Control and Consolidation and Reporting Departments
Martifer also has a Planning and Management Control Department that, supported by the Company’s information systems
produces, monitors and analyses management information, raising questions at unit level.
The consolidated financial statements are prepared by Martifer’s Consolidation and Reporting Department, which guarantees
consistency in the application of the accounting policies adopted.
It should be highlighted that the risks subjacent to the reliability and integrity of the accounting and financial information are also
assessed and reported on as part of the activities of the Statutory and External Auditors.
It should also be pointed out that there is an Ethics and Conduct Code and a system for the reporting of irregularities, which fosters
Martifer Group’s control culture.
51. Details, even if through the inclusion of an organisational chart, of hierarchical and/or
functional dependency in relation to other boards or committees of the Company
Regarding hierarchical or functional dependency amongst the corporate bodies and departments responsible for the
implementation and monitoring of the internal control systems, better described in the preceding point:
−
The Risk Committee is a specialised committee constituted by the Board of Directors, formed primarily by non-executive
members of the Board of Directors and/or the Supervisory Board, and is chaired by an independent director;
−
−
The Supervisory Board is elected at the Company’s Shareholders’ General Meeting and is an independent body;
−
The Internal Audit Department reports functionally to an independent non-executive director of the Board of Directors –
Professor Jorge Bento Farinha;
−
The Planning and Management Control and the Consolidation and Reporting Departments both report to the Company’s Board
of Directors.
The External Auditor, proposed by the Supervisory Board, is elected at the Company’s Shareholders’ General Meeting and the
results of its activity are assessed by the Supervisory Board;
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52. Other functional areas responsible for risk control
We consider that this point is already explained in detail in the preceding point and, therefore, refer thereto for the response to this point.
53. Details and description of the major economic, financial and legal risks to which the
company is exposed in pursuing its business activity
FINANCIAL RISKS
A) PRICE RISK
The volatility of the prices of raw material constitutes a risk for the Group, both in metallic constructions and in solar. The
antidumping measures/charges that the European Union decided to implement on steel and aluminium products with origin in China
brought a great uncertainty regarding price, which will affect the operational activity of the metallic constructions business area.
Concerning the market trend on solar panel prices, they kept constant; however, their variation may also influence the solar activity.
Martifer has sought to mitigate this risk the same way in both areas, by including clauses in the contracts with customers that allow
it to pass on raw-material price fluctuations and by negotiating fixed prices for large scale projects with its suppliers.
B) CURRENCY RISK
Currency risk has a strong correlation with the other types of risk, with highlight to its relation with countries’ risk, through the
evolution of economies and their impact in inflation and interest rates, and with credit risk, via currency fluctuations that may
jeopardize future financial flows, reflecting the possibility of registering gains or losses resulting from changes in the foreign
exchange rates between different currencies.
The Group’s internationalization forces it to be exposed to currency risk from different countries.
Exposure to currency risk results mainly from operational activities (in which expenses, income, assets and liabilities are expressed
in a currency other than the reporting currency of the Group), from transactions between these subsidiaries and other Group
companies and from the existence of transactions with external parties made by the operational companies in a currency other than
the reporting currency of the Group.
Concerning exchange rates’ hedging, hedges are sporadic as their cost is sometimes considered excessive in relation to the risk
level involved. However, whenever considered suitable, the Group contracts exchange rates hedging in order to cover the risk.
During 2015, as a result of the severe economic and financial crisis Angola has been facing, explained, in large part, by the
significant drop in oil prices, there was a huge shortage of tradable currency in the Angolan market, causing limitations in the
financial flows coming from this geography.
The Group has been soughing to mitigate this risk through financial instruments presented by its clients (e. g. letters of credit) in
order to maintain the regular financial flow.
C) INTEREST RATE RISK
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The cost of financial debt contracted by the Group is indexed to short term base rates, reviewed with a year or less frequency, plus
a negotiated risk premium. Therefore, variations in interest rates may affect the Group’s results.
the Group faces a risk of fair value variation on these assets or liabilities, since every change in market rates involves an
opportunity cost. In the second case, such change has a direct impact on interest value, consequently causing cash variations.
During 2015, the reference interest rates in the euro area remained at very low levels, even reaching negative values at the end of
the year. According to the European Central Bank projections published on March 216 (“March 2016 ECB staff macroeconomic
projections for the euro area”), rates should remain at very low levels during 2016 and 2017, with a modest growth expected for
2018.
th
premium rates (spread) to very competitive values, allowing for a lower exposure to interest rate risk. This change in the bank
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financing pricing took effect as from 1 January 2015. This factor, together with the expected stability in the reference rates
contribute for Martifer’s current low exposure to interest rate risk.
D) LIQUIDITY RISK
As mentioned above, at the end of 2015, the Group restructured its debt with financial institutions, through the rescheduling of bank
at the same time, to allow the cash surpluses to be sufficient to comply with its responsibilities.
st
As a consequence of the previously mentioned measures, it is verifiable that, on 31 December 2015, the Current Assets largely
The financial direction accompanies the implementation of the risk management policies defined by the board, in order to ensure
that the economic and financial risks are identified, measured and managed according with those policies.
E) CREDIT RISK
The Group undergoes credit risk in its operational activity – Trade Receivables and Other Receivables.
ensuring the collection of the amounts due within the negotiated periods.
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manages cases in litigation, procedures which are all considered essential to manage the credit conceded and to minimize the risk
of credit default.
OPERATIONAL RISKS
A) METALLIC CONSTRUCTIONS
divided into three risk sources – client, supplier and external risk, which in turn are sub-divided into specific problems.
Under client risk one can identify, for example, issues at the contractual level, such as the lack of convergence in the interpretation
and application of the contractual dispositions, the distaste or dissatisfaction with the service / product and also the risk of nonpayment of the price stipulated following the delivery of the projects.
Under supplier risk, Martifer Construções, as a specialist in engineering projects, relies on subcontractors very often. If these fail in
the execution of their work the project’s delivery deadline cannot be met, in a domino effect. In other words, there is also a risk of
Arabia, which will allow to compensate both the effects of economic recession in Portugal and the economic slowdown in Europe.
B) SOLAR
of equipment may disrupt the initially foreseen calendars for the completion of the respective projects. Despite the fact that this type
difficulties it can present.
the Group, currently being adopted, shall reduce the possible impact of this situation.
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with a resulting dependency risk on key raw material suppliers. The Group has sought to mitigate this risk by establishing long-term
C) RENEWABLES
revenues (price and volume of energy produced by the assets). The equipment use and other exogenous factors, such as the wind
that, in turn, depends on the farm location, influence the energy production and consequently its results. Whenever the wind speed
is below or above the equipment limits, no energy is produced. These limits vary according to the manufacturer and type of turbine.
Additionally, each turbine has a power curve that determines the generated power on each wind speed.
velocity variations at each farm and ensuring the relative stability of the volume of total energy produced.
Regarding solar photovoltaic energy, the exogenous factors are more easily forecasted and therefore the revenues variation is
minimized.
LICENCING:
Wind farms and solar parks are subject to rigorous regulations in matters such as the development, construction, licensing and
LEGAL RISKS
Martifer is subject to the national and local laws and regulations in the various geographies and markets where it operates. These
aim to ensure, among other, labour rights, environment protection, spatial planning and the maintenance of an open and
competitive market. Thus, the legal and regulatory changes that affect the conditions conducive to the development of the Groups’
activities and that consequently harm or impede the attainment of the strategic objectives require the Company to adapt to the new
regulatory realities.
respective activities, which operate in the dependence of the Board of Directors and management, conducting their work in
of the stakeholders’ interests, in strict compliance with their legal duties.
The members of the legal departments and internal advisory service providers referred to above have specialized formal
Legal and fiscal advisory services are also ensured, nationally and internationally, by external professionals, selected amongst
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54. Description of the procedure for identification, assessment, monitoring, control and risk
management
RISK MANAGEMENT SYSTEMS
Risk Management is one of the components of Martifer’s culture, being present in all management processes and representing a
responsibility of all managers and employees at the various levels of organisation.
Risk policy is defined by the Board of Directors based on the analysis and measurement of risk, which also coordinates and
develops risk management processes in order to guarantee an integrated risk management streamlined with the strategy and
objectives of the Group.
In parallel, Martifer continues to implement internal control and risk management procedures with the objective of reinforcing the
integrated risk management, establishing a strategy for the prevention and management of risk transversal to the Group, so as to reduce
exposure to risk and safeguard the value of the Group. The procedure is characterised, summarily, by the identification of the risks in
each business area, accompanied, in parallel, by the formalisation of an assessment, management, prevention and mitigation of risk
process, to be elaborated by the Company’s Board of Directors, supported by the Risk Committee.
Risk Management comprises the processes of identifying current and potential risks, analysing their possible impact on the
strategic objectives of the organisation and estimating the probability of their occurrence, in order to determine the best way to
manage exposure to these.
All these risks are duly identified, assessed and monitored, and it is the responsibility of the different structures in the company to
manage and/or mitigate them.
Risk Management at Martifer Group starts at the operational company level, with the identification, measurement and analysis of the
different risks to which it is subject, with special emphasis on risks of an operational and market nature, seeking to estimate the
probability of the occurrence of the various factors that determine such risks and their potential impact on the business of the Company
or activity in question.
Without prejudice to the definition of the risk strategy by Martifer’s Board of Directors, the persons responsible for the operations are
also responsible for the implementation of risk control mechanisms, which are scrutinised by the competent Financial, Tax and
Legal Departments.
The identification of the risks is a responsibility transversal to the different levels of the organisation, specific templates having
been created to identify and categorise the main risks in each Business Area, as well as the new risks that may arise as the
respective activities develop, including:
(i) economic and business risks,
(ii) financial risks, and
(iii) legal risks.
The Risk Committee is also responsible for the analysis and issuance of opinions, which are submitted to the Board of Directors on,
amongst others, new Group investments above certain amounts and new geographies for Martifer Group’s activities.
The efficiency of these mechanisms is periodically assessed by the Holding Company, through the Internal Audit Department,
during the execution of the audit plan covering the financial aspects, information systems, processes and conformity with the
procedures approved. This audit plan is prepared and developed annually, based on a prior assessment of the business risks, the
mechanisms and assessments of the internal audit department being monitored and verified by the Company’s Supervisory Board
within the scope of its functional powers.
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The function of Planning and Management Control also promotes and supports the integration of risk management in the
companies’ planning and management control processes.
It is an objective of the Holding Company to obtain an integrated vision of the risks the Group faces in each of its different activities
or business areas and to guarantee the consistency of the resulting risk profile with that of the Group’s global strategy and, in
particular, to determine what it considers an acceptable risk level, given the structure of its capital.
To this effect, operations with the highest relevance and impact on Martifer Group, as well as those of a more financial nature are
directly assessed and validated by the Financial, Tax and Legal Departments at the Holding Company level, in line with the policies
and risk strategies set by management.
55. Core details on the internal control and risk management systems implemented in the
company regarding the procedure for reporting financial information (Article 245-A/1/m)
Concerning the release of financial information, the Martifer Group promotes strict cooperation amongst all the bodies, departments
and remaining participants in the process, so that the financial information is prepared in accordance with the legal requirements in
force, complying with the best practices of transparency, relevance and reliability, is subject to an effective verification, whether by
internal analysis, by the supervisory bodies and the External Auditor, is approved by the responsible corporate body and its
disclosure complies with all the legal requirements and recommendations, namely those of the CMVM.
In the financial information disclosure process we highlight:
−
−
The use of accounting policies that are explained in the Notes to the Financial Statements;
−
The accounting records and the preparation of the financial statements are prepared by the Financial, Accounting and Planning
and Management Control Departments, that guarantee the control over the recording of the transactions of the business
processes and over the balances of the asset, liability and equity accounts;
−
The consolidated financial statements are prepared periodically, on a quarterly basis, by the Consolidation and Reporting
Department and validated by the Planning and Management Control Department;
−
The Management Report is prepared by the competent internal departments, with the contribution and additional review of the
various business and support areas. The Statutory Auditor also reviews the content of this report (the annual and half-yearly
versions) and its conformity with the supporting financial information;
−
The Group’s financial statements are prepared under the supervision of the executive directors of the Group. The documents comprising
the half-yearly and annual reports are sent for the review and approval of the Board of Directors. Subsequent to their approval, these
documents are sent to the External Auditor, who issues his legal certification of the accounts and the External Audit’s Report;
−
The Statutory Auditor carries out both an annual audit and a limited review at the half-year of the individual and consolidated
accounts, carried out in accordance with the Auditing Standards in force.
The financial information is analysed by the persons responsible for the management of the respective business areas, seeking
to exercise permanent monitoring and the respective budgetary control;
IV. INVESTOR ASSISTANCE
56. Department responsible for investor assistance, composition, functions, the information
made available by said department and contact details
Martifer privileges a permanent contact with the capital market, seeking to guarantee a permanent access to information on the
Group in a continued and consistent manner, be it through the disclosure of periodic financial information or through contacts with
institutional investors, namely by participating in road-shows and conferences, or through permanent contact with financial analysts.
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Shareholders and investors can generally obtain all the relevant Group information from Martifer’s Website at http://www.martifer.pt/,
in particular from the Investor Relations page, where they can find, in addition to the mandatory information of a corporate and
financial nature, information on the evolution of its quoted share price. Shareholders and Investors can also contact the Investor
Assistance Office, which assures a permanent contact with the market.
During the 2015 financial year, Martifer participated in various events amongst which roadshows, seminars, one-on-one meetings
and conferences aimed at institutional investors.
The Investor Relations and Communications Office seeks to assure the market, investors, analysts and journalists the disclosure of
information on the Martifer Group in a continued, opportune and balanced manner.
The main functions of the Investor Assistance Office are, amongst others:
−
−
−
−
Assuring, vis-à-vis the authorities and the market, compliance with the legal and regulatory reporting obligations applicable to
Martifer SGPS, SA. The disclosure of information falling within the scope of “ announcement of privileged information”, the
announcement of quarterly information on the activities and results of the Group and the preparation of the annual, half-yearly
and quarterly reports and financial statements, are to be highlighted;
Satisfy investor (institutional and private), financial analyst and other agents’ requests for information;
Supporting and advising Martifer’s Executive Committee in aspects relating to the company’s public status, an example being
the monitoring of the evolution of Martifer’s quoted share price, in its multiple aspects, supporting the Executive Committee with
the direct contacts it regularly maintains with financial analysts and institutional investors (national and foreign), through
conferences, meetings and road-shows. At an organic level, the Investor Assistance Office reports directly to the Executive
Committee of the Board of Directors of Martifer SGPS.
Information made available by the Investor Assistance Office:
•
•
•
•
•
•
•
Investor Kit
General Information
Main Indicators
Corporate Governance
Corporate Bodies
Articles of Association
Ethics and Conduct
•
•
•
•
•
•
•
General meetings
Share Price Quotation
Agenda
Publications
Financial Information
Presentations
Notices
The Investor Assistance Office may be contacted at the following contacts:
[email protected]
Martifer SGPS, Apartado 17
3684-001 Oliveira de Frades Portugal
Telephone: +351 232 767 702
Fax: +351 232 767 750
57. Market Liaison Officer
For purposes of the Securities Code, the Market Liaison Officer is, Mr. Pedro Nuno Cardoso Abreu Moreira.
Mr. Pedro Nuno Cardoso Abreu Moreira
Martifer SGPS, Apartado 17
3684-001 Oliveira de Frades Portugal
Telephone: +351 232 767 702
Fax: +351 232 767 750
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58. Data on the extent and deadline for replying to the requests for information received
throughout the year or pending from preceding years
−
Requests for information received by the Investor Assistance Office recorded a significant increase as from the second-half of
2015, which is justified by the improvement in the financial markets’ expectations regarding Portugal and company performance.
Information requests were by and large made by institutional investors, but some information requests were also placed by
small retail investors.
−
The Market Liaison Office aims to minimize the response time for the requests, and when an immediate response is not
possible, it shall not exceed 24 hours, except for exceptional circumstances.
V. WEBSITE
59. Address(es)
Martifer has a Website bearing the electronic address (http://www.martifer.pt/) with a wide range of information on the Martifer Group.
60. Place where information on the firm, public company status, registered office and other
details referred to in Article 171 of the Commercial Companies Code is available
Information can be consulted at the following electronic address:
http://www.martifer.com/pt/grupo/legal-disclaimer/
61. Place where the articles of association and regulations on the functioning of the
available
boards and / or committees are
http://www.martifer.pt/pt/grupo/investidor/corporate-governance/estatutos/
62. Place where information is available on the names of the corporate bodies' members,
the Market Liaison Officer, the Investor Assistance Office or comparable structure,
respective functions and contact details
http://www.martifer.pt/pt/grupo/investidor/corporate-governance/orgaos-sociais/
http://www.martifer.pt/pt/grupo/investidor/informacoes-gerais/gabinete-de-apoio/
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63. Place where the documents are available and relate to financial accounts reporting, which
should be accessible for at least five years and the half-yearly calendar on company events
that is published at the beginning of every six months, including, inter alia, general meetings,
disclosure of annual, half-yearly and where applicable, quarterly financial statements
http://www.martifer.pt/pt/grupo/investidor/publicacoes/informacoes-financeiras/
64. Place where the notice convening the general meeting and all the preparatory and
subsequent information related thereto is disclosed
http://www.martifer.pt/pt/grupo/investidor/corporate-governance/assembleias-gerais/
65. Place where the historical archive on the resolutions passed at the company's General
Meetings, share capital and voting results relating to the preceding three years are available
http://www.martifer.pt/pt/grupo/investidor/corporate-governance/assembleias-gerais/
D. REMUNERATION
I. Power to establish
66. Details of the powers for establishing the remuneration of corporate boards, members
of the executive committee or chief executive and directors of the company
The remuneration policy and the remuneration of the Company’s Corporate Bodies are established by a Remuneration Setting
Committee, elected at the Shareholders’ General Meeting. This policy is reviewed annually and submitted for approval at the
Company’s Annual Shareholders’ General Meeting, where at least one representative of said Remuneration Setting Committee is
present.
The Remuneration Setting Committee’s activity is dedicated to the preparation of master guidelines and the determination of the
remuneration policy of the Company’s corporate bodies, to monitoring the execution of that policy and to guaranteeing the
alignment of the actions of those bodies with the interests of the Company.
The Remuneration Setting Committee has as its main powers:
−
Defining the remuneration policy of the Corporate Bodies of the Company, particularly of the executive members of the Board of
Directors, fixing the criteria to determine the variable component of the remuneration;
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−
Determining the various components of the fixed and variable remuneration, possible benefits and complements, as well as the
annual remuneration payable to the members of Martifer’s Corporate Bodies;
−
Monitoring the performance of the executive members of the Board of Directors for the purposes of determining the variable
remuneration;
−
−
Monitoring the performance of the non-executive members of the Board of Directors;
Submitting, in an advisory capacity, an informative exposition on the company’s remuneration policy to the annual General
Meeting.
The Remuneration Setting Committee sporadically requests, if necessary, from Martifer’s internal departments (namely the Human
Resources Department, the Planning and Management Control Department and the Legal Department) specialised information and
data of a technical nature, amongst other, relating to the structure of the company, results of the Group and members and activities
of the corporate bodies. The information requested and received by the Committee is aimed at the compilation of a body of
information and technical data that permits the definition and implementation of the Group’s remuneration policy.
The information requested is provided free of charge, and the Committee has no need to hire persons, natural or legal, to carry out
its duties.
The External Auditor is also obliged to verify the application of the policies described and the remuneration systems of the
corporate bodies, being obliged to report any potential non-conformity detected to the Supervisory Board.
II. Remuneration Committee
67. Composition of the remuneration committee, including details of individuals or legal
persons recruited to provide services to said committee and a statement on the
independence of each member and advisor
The composition of the current Remuneration Setting Committee, elected at a Shareholders’ General Meeting for a three-year term
of office (2015-2017), is as follows:
PRESIDENT
António Manuel Queirós Vasconcelos da Mota
MEMBERS
Maria Manuela Queirós Vasconcelos Mota dos Santos
Júlia Maria Rodrigues de Matos Nogueirinha
The members of the Remuneration Setting Committee are independent of the management body, considering the explanation
contained in the paragraph that follows.
During the 2015 corporate period, a member of the Remuneration Setting Committee – Mrs. Júlia Matos – was also a member of a
corporate body of a company, which share capital is held by two executive directors of the Company, namely Messrs Carlos
Marques Martins and Jorge Marques Martins. However, the Company considers that the independence of the Remuneration
Setting Committee is safeguarded not only because of the professional training of this member in particular, but also because of the
fact that the remaining members of the Committee, which for the majority, are independent from the executive members of the
management body of the Company.
No persons were hired to integrate the Remuneration Setting Committee.
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68. Knowledge and experience in remuneration policy issues by members of the
Remuneration Committee
The Company considers that all the individuals comprising this Remuneration Setting Committee, totally fit to carry out their duties
with excellence from a professional training perspective or based on positions previously held,.
Ms. Maria Manuela Queirós Vasconcelos Mota dos Santos is President of the Human Resources Development Commission of the
Mota-Engil Group.
The experience and knowledge of the members of the Remuneration Setting Committee are better described in their curricula
presented in the document attached to this report and attest, in a rigorous and specific manner, their ability to carry out the duties
attributed to them.
III. Remuneration structure
69. Description of the remuneration policy of the Board of Directors and Supervisory Board
as set out in Article 2 of Law No. 28/2009 of 19 June
The remuneration of the members of the Board of Directors and of the Supervisory Board of the Company is determined, in terms
of the Articles of Association, by the Remuneration Setting Committee, which submits a annual document, for appraisal at the
General Meeting, containing the general guidelines to be followed in establishing the specific amounts to attribute to the members
of the various Corporate Bodies.
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At the Company’s General Meeting of 14 May 2015, the remuneration policy of the management and supervisory bodies, prepared
by the Remuneration Setting Committee, in compliance with Article 2 of Law no. 28/2009, of 19 June, and available in the
Company’s Website at http://www.martifer.pt/ (Tab: Investors, Section: Corporate Governance /General Meeting), was discussed
and submitted for approval.
In general terms, said remuneration policy of the management and supervisory bodies seeks to closely follow the CCC and the
Portuguese Securities Market Commission’s Corporate Governance Code provisions applicable, this being reflected in the
statement submitted for approval at the General Meeting referred to in the point that follows.
In defining the remuneration policy for the 2015 year, the legal provisions foreseen in (i) the CCC, namely in Article 399; (ii) Law
28/2009, of 19 June; (iii) the 2010 Corporate Governance Code issued by the CMVM; and (iv) the special regime laid down in the
Company’s Articles of Association, were considered.
70. Information on how remuneration is structured so as to enable the aligning of the interests
of the members of the Board of Directors with the Company's long-term interests and how
it is based on the performance assessment and how it discourages excessive risk taking
Martifer’s remuneration policy aims to promote the convergence of the interests of the directors, those of the other corporate bodies
and of the managers with the Company’s interests, namely those regarding the creation of value for the shareholder and real
growth for the Company, privileging a long-term perspective.
Hence, the Committee structured the components of the remuneration of the Management bodies so as to reward their
performance in achieving high and, simultaneously, sustained growth, discouraging, however, excessive risk-taking. Additional
determining factors include the company’s economic situation and general market conditions practiced for equivalent functions.
I
The remuneration of the executive members of the Board of Directors shall comprise a fixed and, when so deliberated by the
Remuneration Setting Committee, a variable component, with the latter variable part of the remuneration to not exceed 5% (five per
cent) of the results for the period, as laid down in law and in Article 20, no. 3 of the Articles of Association.
The informative principles observed by the Committee in establishing the remuneration are:
a) DUTIES CARRIED OUT, degree of complexity inherent to the duties, responsibilities attributed, time spent and the added
value to the Company of the work produced. Other duties carried out at group companies are also relevant, in virtue of the
increased responsibilities and of their constituting additional sources of revenue.
b) ALIGNMENT OF THE INTERESTS OF THE MEMBERS OF THE MANAGEMENT BODY WITH THOSE OF THE COMPANY,
appraisal of the performance of the members of the management body and of the creation of value for the shareholders.
c) ECONOMIC SITUATION OF THE COMPANY, present and future, privileging the interests of the Company in the long-term
term and the achievement of real growth for the Company and the creation of value for its shareholders, based on criteria
defining the economic situation of the Company, amongst others, those of a financial nature.
d) GENERAL MARKET CONDITIONS FOR EQUIVALENT SITUATIONS, considering that the remuneration shall be aligned with
market practice, permitting it to serve as a means to achieving high individual and collective performance, assuring the
interests of the member but essentially those of the Company and of the shareholders.
The general guidelines governing the remuneration policy followed by the Remuneration Setting Committee during the 2015
financial period were those contained in the Remuneration Policy Statement, which was subject to resolution at the Company’s
th
General Meeting of 14 May 2015, and can be found on Annex III of this report.
71. Reference, where applicable, to there being a variable remuneration component and
information on any impact of the performance appraisal on this component
As described in more detail in the preceding point the remuneration of the executive members of the Board of Directors shall
comprise a fixed and, when attributed, a variable component.
The fixed component of the remuneration of the members of the Board of Directors with executive functions, as well as of the nonindependent, non-executive members (when attributed), shall consist of a monthly amount payable fourteen times a year, the
variable portion not being permitted to exceed five per cent of the results for the financial period, as laid down by law and in Article
20, no. 3 of the Articles of Association.
In setting all remuneration, including, namely, in distributing the total amount of the variable remuneration amongst the members of
the Board of Directors, the general principles consigned above shall be observed: duties carried out, alignment with the interests of
the Company, privileging the long-term, the situation of the Company and market criteria.
The process of attributing variable remuneration (VR) to the executive members of the Board of Directors shall follow the criteria
laid down by the Remuneration Setting Committee, namely, their position in the hierarchy, the performance appraisal carried out,
the company’s real growth, seeking in determining those criteria to strengthen the convergence of the interests of the Management
bodies with those of the Company, privileging the long-term perspective, this perspective being considered in the performance
criteria applied to Management. The following will therefore be decisive for the appraisal and mensuration of VR:
−
−
−
−
the contribution of the executive directors to the results obtained;
the profitability of the businesses from the shareholder perspective;
the evolution of the share price quotation; and
the extent to which the projects integrated and measured by the Balanced Scorecard of the Group are realised.
During the course of 2015, no contracts were celebrated, be it with the Company, or with third parties, which effects are to mitigate
the risk inherent to the variable remuneration established by the Company for the members of the management board.
I
72. The deferred payment of the remuneration’s variable component, specifying the
relevant deferral period
During the 2015 financial year, no variable remuneration was attributed to the directors of Martifer; consequently, the issue of
deferral of this remuneration component did not arise. On the other hand, the Remuneration Policy of the management and
th
supervisory bodies, drawn up by the Remuneration Setting Committee and approved at the General Meeting of 14 May 2015,
does not foresee the deferral of variable remuneration, when attributed.
Therefore, during the relevant financial year the company’s directors did not receive variable remunerations and, consequently, the
issue of deferral of this remuneration component did not arise.
73. The criteria whereon the allocation of variable remuneration on shares is based, and
also on maintaining company shares that the executive directors have had access to, on
the possible share contracts, including hedging or risk transfer contracts, the
corresponding limit and its relation to the total annual remuneration value
Martifer’s existing Remuneration Plan in Stock Options was constituted and attributed in the 2008 corporate period, foreseeing the
deferral of the exercising of the options for a period of 4 years; consequently, the exercising of the options related thereto expired
during the 2013 corporate period.
Regarding the 2008 Plan, none of the directors exercised their option rights during the respective deferral period.
During the course of the 2015 corporate year, the Company neither implemented nor attributed another stock and/or stock options
plan and, consequently, no variable remuneration was allocated on shares to the directors and no criteria were established for the
maintenance of those shares by the executive directors.
74. The criteria whereon the allocation of variable remuneration on options is based and
details of the deferral period and the exercise price
As better described in the preceding, and given that during the fiscal year 2015, the Company has not implemented, nor charge
allocation of shares and / or share purchase option plan, point the Company considers this point not applicable.
75. The key factors and grounds for any annual bonus scheme and any additional nonfinancial benefits
The Company has neither implemented any annual bonus scheme nor any additional non-financial benefits.
76. Key characteristics of the supplementary pensions or early retirement schemes for
directors and date when said schemes were approved at the General Meeting, on an
individual basis
The Company does not have supplementary pensions or early retirement schemes for the members of the management and
supervisory bodies and for other managers, as defined in no. 3 of Article 248-B of the Securities Code.
I
77. Details on the amount relating to the annual remuneration paid as a whole and
individually to members of the Company's Board of Directors
DIRECTOR
EXECUTIVE
DIRECTOR
FIXED
REMUNERATION
VARIABLE
REMUNERATION
STOCK
OPTIONS
ATTENDANCE
FEES
TOTAL (€)
(Chairman)
Yes
€63,123.82
0
0
0
€63,123.82
(Vice Chairman)
Yes
€27,300,00
0
0
0
€27,300,00
Pedro Nuno Cardoso Abreu
Moreira
Yes
€113,190.54
0
0
0
€113,190.54
Arnaldo Nunes da Costa
Figueiredo
No
0
0
0
0
0
Luis António de Valadares
Tavares
No
0
0
0
€15,000,00
€15,000,00
Jorge Bento Barbosa Farinha
No
0
0
0
€15,000,00
€15,000,00
78. Any amounts paid, for any reason whatsoever, by other companies in a control or group
relationship, or are subject to a common control
During 2015, only the following members of the Board of Directors earned a fixed remuneration from the following Company
affiliates:
DIRECTOR
COMPANY
FIXED REMUNERATION
Martifer Construções Metalomecânicas, S.A.
€127,588.50
Martifer Construções Metálicas, Lda (Brasil)
R$ 42.600,14 (i)
SPEE 2 - Parque Eólico de Vila Franca de Xira, S.A.
€28.000,00
SPEE 3 - Parque Eólico de Baião S.A
€28.000,00
(i) Remuneration received in local currency – Brazilian Real, which global amount corresponds to €9,875,77, at the 31/12/2015 foreign exchange rate (R$ 4.3136), i.e.
that of the last day of the financial period being reported on.
79. Remuneration paid in the form of profit sharing and/or bonus payments and the reasons
for said bonuses and/or profit sharing being awarded
During the 2015 financial period, no remuneration was paid in the form of profit sharing and/or bonus payments.
80. Compensation paid or owed to former executive directors concerning contract
termination during the financial year
During 2015, no compensation was paid, nor is it owed, to former executive directors in respect of contract termination.
I
81. Details of the annual remuneration paid, as a whole and individually, to the members of
the Company's Supervisory Board for the purposes of Law no. 28/2009, of 19 June
MR. MANUEL SIMÕES DE CARVALHO E SILVA**
€2,000.00
MR. JOÃO CARLOS TAVARES CARRETO LAGES**
€2,000.00
MR. JUVENAL PESSOA MIRANDA **
0
MR. AMÉRICO AGOSTINHO MARTINS PEREIRA*
€2,400.00
MR. CARLOS ALBERTO DA SILVA E CUNHA
€4,800.00
MR. PAULO SÉRGIO JESUS DAS NEVES*
€2,400.00
MR. ANTÓNIO BAIA ENGANA*
€ 0.00
TOTAL
€ 13,600.00
* elected on the 14th May 2015 Annual General Meeting.
** Terminated his duties on 14th May 2015, with the election of the new governing bodies in the General Meeting which took place on the same date
82. Details of the remuneration in said year of the Board of the General Meeting
JOSÉ CARRETO LAGES**
€1,200.00
FRANCISCO ARTUR DOS PRAZERES FERREIRA
DA SILVA**
€0.00
ANA MARIA TAVARES MENDES**
€400.00
JOSÉ JOAQUIM NEIVA NUNES DE OLIVEIRA*
€400.00
LUIS LEITÃO MARQUES VALE LIMA*
€400.00
LUIS NEIVA DE OLIVEIRA NUNES DE OLIVEIRA*
€400.00
TOTAL
€ 1,600.00
* elected on the 14th May 2015 Annual General Meeting.
** Terminated his/her duties on 14th May 2015, with the election of the new governing bodies in the General Meeting which took place on the same date
I
V. Agreements with remuneration implications
83. Envisaged contractual restraints for compensation payable for the unfair dismissal of
directors and relevance thereof to the remunerations’ variable component
The Company has neither established nor agreed to any contractual restraints for compensation payable to directors of the
Company on unfair dismissal.
th
Likewise, the Remuneration Policy approved at the General Meeting of 14 May 2015 does not foresee any calculation or
determination formula for the amount due to a director in these circumstances; consequently, the normal regime would apply in
such circumstances.
84. Reference to the existence and description, with details of the sums involved, of agreements
between the company and members of the Board of Directors and managers, pursuant to
Article 248-B/3 of the Securities Code that envisages compensation in the event of resignation or
unfair dismissal or termination of employment following a takeover bid (Article 245-A/1/l))
The Company is not part to any agreement with the members of the management body or other managers, as defined in no. 3 of
Article 248-B of the Securities Code, that foresees compensation in the event of resignation, unfair dismissal or employment
termination following a takeover bid.
VI. Share-Allocation and/or Stock Option Plans (“stock options”)
85. Details of the plan and the number of persons included therein
Martifer currently has no active Remuneration Plan in Stocks and Stock Options.
86. Characteristics of the plan (allocation conditions, non-transfer of share clauses, criteria
on share-pricing and the exercising option price, the period during which the options may
be exercised, the characteristics of the shares or options to be allocated, the existence of
incentives to purchase and/or exercise options
As better described in the preceding point, the Company has no active Stock or Stock Options Plan; consequently, the information
pertaining to this point is not applicable.
87. Stock option plans for the company employees and staff
The Company has no active Stock or Stock Options Plan; consequently, the information pertaining to this point is not applicable.
88. Control mechanisms for a possible employee-shareholder system inasmuch as the
voting rights are not directly exercised by said employees (Article 245-A/1/e))
The Company has no active Stock or Stock Options Plan; consequently, the information pertaining to this point is not applicable.
I
E. RELATED PARTY TRANSACTIONS
I. Control mechanisms and procedures
89. Mechanisms implemented by the Company for the purpose of controlling transactions with
related parties (For said purpose, reference is made to the concept resulting from IAS 24)
Transactions with Directors of Martifer or with entities in a group or dominant relationship in which the former are likewise also
Directors, irrespective of the amount, are subject to the prior approval of the Board of Directors with the approval of the supervisory
body, in terms of Article 397 of the CCC.
90. Details of transactions that were subject to control in the referred year
In 2015, the following deals or transactions were made between the company and the Board of Directors or the Supervisory Board:
 Sale of 100 % of the share capital of the subsidiary MARTIFER – INOVAÇÃO E GESTÃO, S.A., headquartered in Zona
capital of € 100,000.00 (one hundred thousand euros), to the subsidiary MARTIFER METALLIC CONSTRUCTIONS – SGPS,
S.A., 75 % owned by MARTIFER SGPS, S.A., and 25 % owned by VECTOR DIÁLOGO – SGPS, S.A., in which the board
members Mr. Carlos Manuel Marques Martins and Mr. Jorge Alberto Marques Martins indirectly own a 53.05 % share, through
th
the company I’M, SGPS, S.A.. The Supervisory Board issued a favourable opinion to the sale on 20 October 2015.
 Sale of 100 % of the share capital of the subsidiary MARTIFER ENERGY SYSTEMS, SGPS, S.A., headquartered in Zona
capital of € 50,000.00 (fifty thousand euros), to the subsidiary MARTIFER METALLIC CONSTRUCTIONS – SGPS, S.A., 75 %
owned by MARTIFER SGPS, S.A., and 25 % owned by VECTOR DIÁLOGO – SGPS, S.A., in which the board members Mr.
Carlos Manuel Marques Martins and Mr. Jorge Alberto Marques Martins indirectly own a 53.05 % share, through the company
th
I’M, SGPS, S.A.. The Supervisory Board issued a favourable opinion to the sale on 14 December 2015.
 Sale of 100 % of the share capital of the subsidiary GEBOX, S.A., headquartered in Zona Industrial de Oliveira de Frades,
parish of Oliveira de Frades, Souto de Lafões e Sejães and municipality of Oliveira de Frades, registered in the trade register of
Oliveira de Frades under the single number of register and tax 507 729 099, with a share capital of € 50,000.00 (fifty thousand
euros), to the subsidiary MARTIFER METALLIC CONSTRUCTIONS – SGPS, S.A., 75 % owned by MARTIFER SGPS, S.A.,
and 25 % owned by VECTOR DIÁLOGO – SGPS, S.A., in which the board members Mr. Carlos Manuel Marques Martins and
Mr. Jorge Alberto Marques Martins indirectly own a 53.05 % share, through the company I’M, SGPS, S.A.. The Supervisory
th
Board issued a favourable opinion to the sale on 14 December 2015.
91. A description of the procedures and criteria applicable to the Supervisory Body when
same provides preliminary assessment of the business deals to be carried out between the
company and the holders of qualifying holdings or entity relationships with the former, as
envisaged in Article 20 of the Securities Code
The Supervisory Board established the procedures and criteria necessary to define the relevant ‘level of significance’, of business
between the company and the holders of qualifying holdings or entities with which the former are linked in any relationship of
dominium or group, in excess of which amount, the intervention of the supervisory body is required.
Hence, without prejudice to the provisions foreseen in Article 397 of the CCC, deals between, on the one hand, the Company or
Group companies and, on the other hand, holders of qualifying holdings or entities with which the former are linked in any
relationship, shall be subject to assessment and prior approval of the Supervisory Board if they meet any one of the following
criteria:
I
a)
Are for an amount equal to or in excess of half-a-million Euros, or, when lower, when aggregated with other transactions
carried out with the same Shareholder holder of qualifying holdings, during the same financial period, result in an amount
equal to or in excess of one million Euros, except those relating to normal Company business;
b)
Regardless of the amount, when they may cause a material impact on the Company’s reputation, in matters concerning the
independence in its relations with holders of qualifying holdings.
II. Data on business deals
92. Details of the place where the financial statements including information on business
dealings with related parties are available, in accordance with IAS 24, or alternatively a
copy of said data
Business dealings with related parties are described in Note 39 of the Notes to the Consolidated Financial Statements, forming part
of the 2015 Consolidated Report and Accounts, available in the Company’s Website at http://www.martifer.pt/ (Tab: Investors,
Section: Financial Information).
II
PART II
Corporate Governance Assessment
1. Details of the Corporate Governance Code implemented
Martifer, whilst issuer of shares that have been admitted to trading on an official stock exchange, is subject to the Portuguese
Securities Market Commission’s (“Comissão do Mercado de Valores Mobiliários”, henceforth also CMVM) Regulation no. 4/2013, of
18 July 2013, and abides by the recommendations contained in the 2013 Corporate Governance Code approved by the CMVM,
both documents available in the CMVM’s Website at www.cmvm.pt.
Martifer has not voluntarily adhered to any other corporate governance code.
The present report was prepared and follows, under no. 2 of Article 4 of CMVM Regulation no. 4/2013, the model appended to said
Regulation, having as its reference the 2013 CMVM Corporate Governance Code.
2. Analysis of compliance with the Corporate Governance Code implemented
In the matter of Corporate Governance and whilst Public Company, Martifer has sought to promote the implementation and adopt
the best corporate governance practices, including those contained in the new 2013 CMVM Corporate Governance Code, guiding
its policy along the highest standards of conduct, ethics and social responsibility, which are intended to be transversal to the Group.
It is an objective of the Board of Directors to implement an integrated and effective management of the Group, enabling the
Company to create value by promoting and guaranteeing the legitimate interests of its Shareholders, clients, suppliers, employees,
the capital market as well as of the community in general, permanently seeking transparency in its relations with the investors and
the market.
Martifer considers that, despite the fact that it does not comply fully with the recommendations contained in the 2013 CMVM
Corporate Governance Code, as amply described and justified in the following chapters of this report, the degree of adoption of the
recommendations is extremely wide and thorough.
3. Analysis of compliance with the Corporate Governance Code adopted
3.1 STATEMENT ON THE ACCEPTANCE OF THE CORPORATE GOVERNANCE CODE
Pursuant to and for the purposes of that laid down in paragraph o) of no. 1 of Article 245-A of the Securities Code, the recommendations
included in the CMVM’s Corporate Governance Code, with the indication of whether adopted or not, whenever applicable to Martifer’s
structure, and references to the text in the report where the form of adoption is described in greater detail, are listed below:
II
CMVM RECOMMENDATIONS
ADOPTION
REFERENCE
CHAPTER, TITLE,
SECTION
I. VOTING AND CORPORATE CONTROL
Part I
B. I b) - 12
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.
Partially
Adopted
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.
Partially
Adopted
I.3. Companies shall not establish mechanisms intended to cause mismatching between the
right to receive dividends or the subscription of new securities and the voting right of each
common share, unless duly justified in terms of long-term interests of shareholders.
Adopted
Part I
B. I b) 12
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.
Adopted
Part I
B. I b)
13
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.
Adopted
Part I
A. I
5
Part II – 3.2
Part I
B. I b) - 12 and 14
Part II – 3.2
CHAPTER, TITLE,
SECTION
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.
Adopted
Adopted
II.1.3. The General and Supervisory Board, in addition to its supervisory duties, 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.
Not applicable
Adopted
Adopted
Part I
B. II a)
21.2
Part I
B. II a)
21.2
Part II – 3.3
Part I
B. II c)
27 and 29
Part I
C. III
50 and 54
II
ADOPTION
REFERENCE
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.
Adopted
Part I
B. II a)
17 and 18
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:
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 a 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, 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.
Adopted
Part I
B. II a)
18
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.
Adopted
Part I
B. II b)
23
II.1.9. The Chair 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.
Not applicable
Part II – 3.2
II.1.10. If the chair 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.
Adopted
Part I
B. II b)
23
Adopted
Part I
B. III a)
33
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.
Adopted
Part I
B. III c)
38 and
V 45
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.
Adopted
Part I
B. III c)
38 and
V 45
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.
Adopted
Part I
B. III c)
38 and
C. III 50
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.
Adopted
Part I
B. III c)
38
II.2. OVERSIGHT
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
ADOPTION
REFERENCE
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.
Partially
Adopted
Part I
D. II
67
and
Part II – 3.2
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 its duties. This
recommendation also applies to any natural or legal person that is related by employment
contract or provision of services with the above.
Adopted
Part I
D. II
67
Partially
Adopted
Part I
D. III
69 and 70
and
Part II – 3.2
II.3. REMUNERATION SETTING
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;
c) 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
bodies shall be submitted to the General Meeting. The proposal shall contain all the
necessary information in order to correctly assess said system.
Not applicable
Part I
D. III
73 and 74
Part II – 3.2
Not applicable
Part I
D. III
76
Part II – 3.2
CHAPTER, TITLE,
SECTION
III. REMUNERATION
III.1. The remuneration of the executive members of the board shall be based on actual
performance and shall discourage excessive risk-taking.
Adopted
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.
Adopted
Part I
D. III
69, 70 and 71
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.
Adopted
Part I
D. III
69 and 70
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.
Not Adopted
Part I
D. III
72
and
Part II – 3.2
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.
Adopted
Part I
D. III
71
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
Adopted
Part I
D. III
Part I
D. III
69 and 70
II
ADOPTION
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.
REFERENCE
73 and 74
Not applicable
Part I
D. III
74
and
Part II – 3.2
Adopted
Part I
D. V
83
CHAPTER, TITLE,
SECTION
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.
Adopted
Part I
C. III
50 and
D. I
66
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 Corporate Governance - said should not exceed more than
30% of the total value of services rendered to the company.
Adopted
Part I
B. V
46 and 47
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.
Adopted
Part I
B. V
44
CHAPTER, TITLE,
SECTION
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 under normal market conditions.
Adopted
Part I
A. II
10
E. I
89 and 90
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.
Adopted
Part I
E. I
91
CHAPTER, TITLE,
SECTION
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 affairs.
Adopted
Part I
V.
59 and following
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
V.
63 a 65
II
3.2 CLARIFICATIONS AS TO DIVERGENCES BETWEEN THE COMPANY’S GOVERNANCE PRACTICES AND THE CMVM
RECOMMENDATIONS
In this chapter, the grounds for the non-adoption or non-application of every single recommendation, which should be read together
with the table presented in the preceding chapter, are explained.
Recommendation 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.
Martifer encourages its Shareholders to participate in the General Meetings and promotes the active exercise of the right to
vote, namely:
−
Disclosure in the Website, in the Portuguese and English languages, of the General Meetings’ convening notices, the
forms of exercising the vote and the procedures to adopt for correspondence or proxy voting;
−
Disclosure in the Website, in the Portuguese and English languages, of the preparatory information in respect of the
various points on the Agenda;
−
−
Access to proxy forms and voting ballots in the Website;
−
Statutory provision that each share is entitled to one vote.
The creation of an electronic mail exclusively dedicated to the General Meeting, and disclosed in the convening notice, to
facilitate the clarification of doubts;
Under Article 17 of Martifer’s Articles of Association, correspondence voting is permitted, without any restriction, in respect of all
matters subject to the appreciation of the Shareholders.
Martifer considers it has only adopted this recommendation partially due to the fact that its Articles of Association do not foresee
electronic correspondence voting. It should be noted that Martifer has adopted a flexible stance vis-à-vis the acceptance of
documentation in respect of correspondence or proxy voting sent via electronic means.
On the other hand, up till the present date, the Company has received no request or manifestation of interest from any
Shareholders or Investors as to the availability of electronic voting, as a result of which Martifer considers that the
correspondence voting system in place, as foreseen in the Articles of Association, totally safeguards all the Shareholders’
access to participation in the decisions submitted for deliberation.
Recommendation 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.
Article 18 of the Company Articles of Association establishes the rule of a simple majority of the votes to pass corporate
resolutions, except when otherwise established by the CCC or the Articles of Association.
Hence, Martifer considers it has adopted this Recommendation, except as to the provision in the Articles of Association that
requires a greater quorum than that foreseen in the CCC for resolutions on the unfair dismissal of Directors.
The reason for the inclusion in the Articles of Association of a quorum greater that that foreseen in the CCC for unfair dismissal
of directors was to protect the interest of the Company, namely to mitigate the risk of the Company being obliged to compensate
directors for unfair dismissal as laid down in no. 5 of Article 403 of the CCC. Indeed, considering the gravity and impact of an
unfair dismissal of directors, the intention was to avoid the occurrence of such a resolution passed by a simple majority of
shareholders as opposed to one based on grounds approved by a more expressive and representative majority of the
Shareholders.
Martifer considers this is the model that best defends corporate interests.
Recommendation II.1.3. . The General and Supervisory Board, in addition to its supervisory duties, 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
II
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.
Martifer considers this Recommendation as not being applicable since said Recommendation relates to a governance model not
adopted by Martifer. Under the terms and conditions foreseen in Article 278 of the Portuguese Commercial Companies Code,
the corporate governance model adopted by Martifer comprises a Board of Directors, a Supervisory Board and a Statutory
Auditor.
Recommendation II.1.9. The Chair 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.
Martifer considers this Recommendation as not being applicable since the Corporate Governance Model of the Company,
applicable during the 2013 financial year, does not foresee the existence of a chairman of an executive board or an executive
committee, but rather the delegation of powers by the Board of Directors on executive directors. Consequently, a formal
structure of executive directors subject to convening notices and meeting minutes has not been set up.
Recommendation 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.
Martifer considers this Recommendation to be partially adopted.
The Company’s Remuneration Setting Committee comprises three members, including one with knowledge and experience in
matters pertaining to Remuneration policy.
During the 2013 financial period, one of the members of the Remuneration Setting Committee - Mrs Júlia Matos – was also a
member of a corporate body of a commercial company which share capital is held by two of the Company’s executive directors,
namely Messrs Carlos Marques Martins and Jorge Marques Martins. However, the Company considers that the purpose of this
Recommendation is duly safeguarded not solely because of the professional training of this member in particular, but also
because the majority of the members of the Remuneration Setting Committee are independent from the executive members of
the Company’s management body, and also because the remaining provisions of this recommendation are fully complied with.
Recommendation 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;
c) Information regarding the enforceability or unenforceability of payments for the dismissal or termination of appointment
of board members.
Martifer considers this Recommendation to be partially adopted.
th
The declaration on the remunerations policy was submitted and approved in the Company’s General Meeting on 14 May 2015,
th
with all the elements contained in article 2 of the Law no. 28/2009, from 19 June, as well as part of the included on the
Recommendation II.3.3 of the 2013 Corporate Governance Code.
Concerning the item b) of the recommendation II.3.3, the company considers that the maximum potential amounts, aggregate
and individual, as well as the circumstances in which these amounts may be due, is exclusively under the Remunerations
Committee’s responsibility, a corporate body independent from the Board of Directors. Therefore, the total compliance of the
referred recommendation is exclusively under the Remuneration Committee’s powers, which decided not to comply with the
recommendation, since it believes that the way the board member’s remuneration is structured is adequate and allows the
alignment of their interests with the Company’s interests on the long term and is in line with the remuneration practices of most
similar companies, keeping in mind the company’s characteristics.
II
Recommendation 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.
Martifer’s existing Stock Options Remuneration Plan was constituted and allocated in the 2008 financial year and the exercising
of the options deriving therefrom expired during the 2013 financial period; consequently, during the course of this financial year
there was no need to assess or approve said plan at the Company’s General Meeting.
Furthermore, during the 2013 financial year, no additional stock attribution or stock options plan existed or was allocated;
consequently, there was no need to submit any proposal related to stock options’ plans for approval at the General Meeting.
Hence, Martifer considers this Recommendation not applicable.
Recommendation II.3.5. Approval of any retirement benefit scheme established for members of corporate bodies shall be
submitted to the General Meeting. The proposal shall contain all the necessary information in order to correctly assess said
system.
During the 2013 financial year, no retirement benefits scheme existed or was established in respect of the members of the
corporate bodies; consequently, there was no need to submit any proposal related to retirement benefit schemes for approval at
the General Meeting.
Hence, Martifer considers this Recommendation not applicable.
Recommendation 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.
The Company’s Remuneration Setting Committee established the exact annual amount for the fixed remuneration component
payable to the directors receiving remuneration from the Company. In parallel, the Company Articles of Association, under
Article 20, no. 3, state that the directors’ variable remuneration may not result in an allocation in excess 5% of the year’s profit,
under law. In this manner, the maximum remuneration limits for the fixed and variable remuneration components are set.
During the 2013 financial period, the Remuneration Setting Committee opted to attribute only the fixed remuneration component
to the directors and not the variable remuneration component, with the purpose of harmonizing the amount of the remuneration
received by the members of the Company’s Board of Directors in accordance with the measures implemented over the last few
periods, relating to the expense and structural cost reduction adopted transversally throughout the Martifer Group so as to
safeguard the highest number of jobs and the Company’s sustainability.
Consequently, the Company considers that it has partially adopted this Recommendation since, even though the Remuneration
Setting Committee has set the exact fixed annual remuneration amount and a statutory limit has already been set for the
variable remuneration component, during the 2013 financial period no variable remuneration was attributed to Martifer’s
directors.
Recommendation 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.
Martifer considers this recommendation to not have been adopted as the remuneration policy established by the Remuneration
Setting Committee for the management and supervisory bodies does not foresee the deferral of the variable remuneration
component, when attributed.
Notwithstanding said non-adoption of this Recommendation, the Company considers that the purpose of said recommendation
was safeguarded during the 2013 financial period in that no variable remuneration component was attributed to the directors of
Martifer during that period. The Remuneration Setting Committee is analysing the definition of criteria to fix the deferral of part of
the variable remuneration, when same is attributed.
II
Recommendation 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.
Martifer considers this Recommendation as not applicable as no variable remuneration was attributed to the directors of Martifer
in 2013 and therefore there was no place for its deferral.
Furthermore, during the 2008 financial period, stock options were attributed and their exercise was deferred for a period of four
years, inclusive. Up till the present date, these stock options allocated as variable remuneration have not been exercised and, in
fact, the possibility of such exercise expired at the end of the 2013 financial period.
4. Other Information
Besides the information and explanations presented in the present Report, there is no additional information of relevance that
should be presented for a proper understanding of the model and the governance practices adopted by Martifer.
th
The Board of directors,
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
ANNEX I
Professional Qualifications
BOARD OF DIRECTORS
Carlos Manuel Marques Martins is the Chairman of the Management Board of Martifer (Chairman of the Board of Directors and
executive director) and one of the founding shareholders of Martifer Group in 1990, having started his professional activities in 1987
in the Company Carvalho & Nogueira, Lda, as Director of Production in the iron sector. He has a degree in Mechanical Engineering
completed at FEUP (Faculdade de Engenharia, Universidade do Porto).
Jorge Alberto Marques Martins is a Board Member of Martifer (Vice Chairman of the Board of Directors and executive director)
and one of the founding shareholders of Martifer Group in 1990, having started his professional activities in 1987 at SOCARPOR Sociedade de Cargas Portuárias (Douro e Leixões), Lda as Adjunct to the Financial Director. He has a degree in Economics
completed at FEP (Faculdade de Economia, Universidade do Porto) and a MBA completed at UCP (Universidade Católica
Portuguesa).
Pedro Nuno Cardoso Abreu Moreira is a member of the Board of Directors of Martifer (executive and non-independent director)
since January 6, 2015, date on which he was co-opted further to the resignation of Mr. Mário Rui Rodrigues Matias. He has a
degree in Economics at Faculdade de Economia da Universidade do Porto (1999), and has been granted an Advanced
Management Programme for Managers by Oporto Business School and an In-Company Executive Training Programme by AESE
Business School. Has extensive international experience, initially being appointed to perform corporate financial coordination
functions within Mota Engil Group's operations in Central Europe, Africa and Latin America; lived between 2008 and 2014 in
Warsaw and Budapest, and was appointed to several board positions of the Mota-Engil Group's operations in Central Europe in the
areas of Real Estate, PPP / PFI, M&A and Corporate Development. During this period was appointed as member of the Board of
Directors at several companies within Mota Engil Group, notably Mota Engil Central Europe SA (Poland), Mota-Engil Real Estate
Management (Holding Real Estate Central Europe), Mota Engil EC CZ (Czech Republic) Mota-Engil EC Slovakia (Slovakia), MotaEngil Magyar (Hungary), Mota Engil EC RO (Romania)), Mota-Engil Brand Management (Netherlands), Mota-Engil Brand
Development (Ireland).
Arnaldo José Nunes da Costa Figueiredo is a member of the Board of Directors of Martifer (non executive and non independent
th
director) since 30 April 2010. He has a degree in Civil Engineering at Faculdade de Engenharia da Universidade do Porto (1977).
He was Chairman of Mota-Engil, Engenharia e Construção, SA and of the Board of Directors of MEITS - Mota-Engil, imobiliária e
turismo, SA; Manager of Mota Internacional, LDA.; Chairman of Board of the Shareholders General Assembly of Maprel-Nelas,
Indústria de Pré-Fabricados em Betão, SA; Member of the Board of the Shareholders General Assembly of Paviterra, SARL;
Chairman of the Remuneration Committee (on behalf of Mota-Engil, Engenharia e Construção, SA) of Ferrovias e Construções, SA;
of Aurimove – Sociedade Imobiliária, SA; of Nortedomus – Sociedade Imobiliária, SA; and of Planinova – Sociedade Imobiliária,
SA.
Jorge Bento Ribeiro Barbosa Farinha is a Board member at Martifer SGPS, SA since 2008. In his academic work, he is a
teacher since 1987, in the category of Assistant Professor at Faculdade de Economia, Universidade do Porto from 1989 and since
1991 he occupied several positions at EGP / University of Porto Business School (EGP - UPBS) and performed duties as the VicePresident of EGP – UPBS (2009-2015). He was also a teacher at Instituto de Estudos Superiores Empresariais (ISEE),
Universidade do Porto (1999-2001), and Vice President of the Pedagogical Council at Faculdade de Economia do Porto (FEP,
2002-2006). In his extra-academic activities, he was a Financial Analyst of Capital Markets at Cisf- Companhia de Investimentos e
Serviços Financeiros, S.A. (1987-1989), a Senior Analyst of the Mergers & Acquisitions Department at Banco Português de
Investimento, S.A. (1990-1992 ), Sub-director of the Mergers & Acquisitions Department at Banco Português de Investimento, S.A.
(1992-1993), partner of Cf&A Associados - Consultores de Gestão, Lda (1993-1994), partner of Futop – Consultores de Gestão,
S.A. ( 1994-1995) and a non-executive Board member at Enotum.com (companies establishment helper in the area of
telecommunications) (2000-2002). He has a degree in Economics (Faculdade de Economia, Universidade do Porto), a MBA at
INSEAD (Institut Européen d'Administration des Affaires, Fontainebleau, France) and a PhD in Accounting and Finance by the
University of Lancaster (Management School), UK. He is a non-executive and independent Board member.
Luís António de Castro de Valadares Tavares is a Board member at Martifer SGPS, SA (independent non-executive director)
since 2008. Since 1980 he is Professor of Systems Management at Instituto Superior Técnico, Universidade Técnica de Lisboa,
and, from 2002, President of the Centre for Prospective - OPET. He is president of APMEP - Portuguese Association of Public
Markets and EDP´s Customer Ombudsman, an EDP independent entity. Previously, he was President of the National Institute of
Administration (2003-2007), First Coordinator of the Master Degree in Operational Research and Systems Engineering (IST),
Director of the Distance Education in Management Program (Dislogo) at UCP, Director and Founder of the Master Degree in Health
Engineering at UCP, First Coordinator of the MBA at the Inter-University Institute of Macau, General Director of the Studies and
Planning Office at the Ministry of Education (PRODEP),, Manager of the Program for the Development of Education in Portugal
(PRODEP), Director of the World Bank‟s Program for Educational System Financing, Director of the Minerva Program (Informatics
in Schools), Vice-President of the Committee for Education (OCDE), President of the Committee for Education (OCDE), President
of the Education Committee of the European Communities (first Portuguese Presidency), First President of the Portuguese
Association of Operational Research (APDIO), Vice-President of the Operational Research Societies Federation (IFORS), Visiting
Professor at the following Universities: North Carolina (Raleigh, USA), Colorado (Denver, USA) , Columbia (NY, USA), Princeton
(NY, USA), UCLA (Los Angeles, USA), Business School of the University of Newcastle (Newcastle, UK), Paris-Dauphine (Paris,
France), Mohammed (Rabat, Morocco), Middle East Technical University (Ankara, Turkey), Technical of Poznan (Poznan, Poland),
Technical of Helsinki (Helsinki, Finland); PUC (Rio de Janeiro, Brazil); Federal of Santa Catarina (Florianopolis). He has a degree in
Civil Engineering completed at IST, a Masters Degree in Operations Research completed at the University of Lancaster (UK), a
PhD degree in Science and Engineering completed at IST, and Aggregated in Operational Research at IST.
SUPERVISORY BOARD
Américo Agostinho Martins Pereira holds a Diploma in Accounting Audit, with Superior Specialized Studies in Audit. He is a
Statutory Auditor, registered with the Ordem dos Revisores Oficiais de Contas under the number 887, performing this activity since
April 1994, initially individually and since March 2013 as a partner in the company M.PEREIRA & ASSOCIADOS, SROC, LDA..
Carlos Alberto da Silva e Cunha holds a Diploma in Advanced Studies (program of PhD degree on Management Sciences),
completed at Vigo University, Spain. A Master degree in Accounting and Administration completed at the University of Minho and is
Postgraduate in "The Impact of the Euro in Business" by the Institute for High Studies on Finances and Tax. He has a degree in
Auditing and the course of Specialized High Studies in Auditing at Instituto Superior de Contabilidade e Administração do Porto. He
also has a graduation completed in Accounting at Instituto Comercial do Porto. He is a registered Auditor in the official list since
March 1990. Also performs duties as Assistant Professor, teaching at Escola de Economia e Gestão, Universidade do Minho as
well at Universidade Lusíada, in Oporto. In 2008 and 2009 was invited to teach in the Post-Graduation Course "Fraud
Management" promoted by Faculdade de Economia, Universidade do Porto.
Paulo Sérgio Jesus das Neves holds a diploma in Accounting Audit, with Superior Specialized Studies in Audit. He holds an MBA
in Finance by the Economics Faculty of Porto (FEP). He is a Statutory Auditor registered with the Ordem dos Revisores Oficiais de
Contas under the number 1342, performing this activity since February 2008. He is a company consultant, in the fields of
organization and management, financial, tax and accounting.
António Baia Engana holds a diploma in Economics by Instituto Superior de Economia (ISE) and a bachelor’s degree in
Accounting by Instituto Comercial de Lisboa (ICL). He is a Statutory Auditor registered with the Ordem dos Revisores Oficiais de
Contas under the number 612, being currently a partner at ALVES DA CUNHA, A. DIAS & ASSOCIADOS, SROC, LDA.. He is,
since 1994, a member of the General Council and Executive Committee of the Commission of Accounting Standards, having
presided to the Executive Committee between 1999 and 2005. He is a member of Supervisory Boards in insurance companies
since October 2009.
REMUNERATION COMMITTEE
António Manuel Queirós Vasconcelos da Mota has a degree in Civil Engineering (Inland Communications) completed at
Faculdade de Engenharia, Universidade do Porto. Currently performs duties as Chairman of the Board of Directors of Mota-Engil,
SGPS, SA, a position he holds since 2000. He has already served as Chairman of the Board in other companies, in particular,
Mota-Engil, Engenharia e Construção, SA (2003-2006), Mota-Engil Internacional, SA (2000-2003), Engil - Sociedade de
Construção Civil, SA (2000-2003) and Mota & Companhia, SA (1995-2003), where he also held the position of Vice-Chairman
(1987-1995). He started his professional life in 1977 as a trainee in Mota & Companhia, Lda, and between 1979 and 1981, he
worked in several departments of the same company, where he also worked as General Director of Production (1981-1987).
Maria Manuela Queirós Vasconcelos Mota dos Santos has a degree in Economics from the Faculdade de Economia,
Universidade do Porto. She has worked in several companies of Mota-Engil Group, being responsible for the Human Resources
Department. Presently she is a member of the Board of Directors at Mota-Engil, SGPS, SA.
Júlia Maria Rodrigues de Matos Nogueirinha has a degree in Law from Faculdade de Direito da Universidade de Coimbra and is
registered with the Portuguese Bar Association since 2002. She is presently a member of the Board of Directors of I’M SGPS, S.A ,
having held the post of Member of the Board of Directors in other companies of the I’M group, namely in Almina – Minas do
Alentejo, S.A.
ANNEX II
Positions Held and Activities Undertaken by the members of the Board Of Directors
CARLOS MANUEL MARQUES MARTINS
a) Positions within the Martifer Group:
CHAIRMAN OF THE BOARD OF DIRECTORS:
Martifer - SGPS, S.A.
Martifer – Alumínios, S.A.
Navalria- Docas,constr. e reparações navais, S.A.
Gebox, S.A.
Martifer Energy Systems, SGPS, S.A.
Nagatel Viseu - Promoção Imobiliária, S.A.
Martifer – Amal, S.A
Martifer Construcciones Metálicas España, S.A.
Martifer Aluminium PTY LTD (Austrália)
Martifer Beteiligungsverwaltungs GmbH (Áustria)
Eviva Beteiligungsverwaltungs GmbH
MEMBER OF THE BOARD OF DIRECTORS:
Martifer – Inovação e Gestão, S.A.
Prio Agriculture B.V. (Holanda)
Porthold B.V. (Holanda)
Martifer Aluminium LTD (UK)
Martifer Construction UK, LTD (UK)
Martifer Aluminium LTD (Irlanda)
Martifer Construction Ltd (Irlanda)
Martifer Constructions SAS (França)
Martifer Aluminium SAS (França)
MT Constructions Maroc, SARL (Marrocos)
Martifer Construcciones PERÚ, SA
Martifer Construções Metalomecânicas, SA, Suc. Colombia
Martifer Mota Engil Coffey Joint Venture Limited
MEMBER OF THE SUPERVISORY BOARD:
Martifer Renewables, SA (Polónia)
MANAGER:
Parque Eólico da Penha da Gardunha, Lda.
Promoquatro - Investimentos Imobiliários Lda.
West Sea – Estaleiros Navais, Lda.
CHAIRMAN OF THE REMUNERATION COMMITTEE:
SECRETARY:
Martifer Renovables ETVE S.A.
b) Positions in companies with shareholding by Martifer Group:
Prio E. SGPS, S.A.
Prio Energy, S.A.
Prio Biocombustíveis, S.A.
Mondefin Combustíveis, S.A.
MARTIMETAL Spa
Prio Parque de Tanques De Aveiro, S.A.
PRIO.E – Electric, S.A.
Nutre SGPS, S.A.
Nutre, S.A.
Nutre - Indústrias Alimentares, S.A
Nutre Farming West Part SRL (Roménia)
Nutre Brasil, Ldta. (Brasil)
Prio Agro Industries Sp. Z.o.o (Polónia)
Agromec Balaciu S.A. (Roménia)
Agrozootehnica Facaeni S.A. (Roménia)
Miharox S.A. (Roménia)
Prio Agricultura Ialomita SRL (Roménia)
Prio Agro Facaeni SRL (Roménia)
Prio Agromart SRL (Roménia)
Prio Balta SRL (Roménia)
Prio Rapita SRL (Roménia)
Prio Terra Agricola SRL (Roménia)
Prio Turism Rural SRL (Roménia)
Prio Agrotrans SRL (Roménia)
Prio Meat SRL (Roménia)
Zimbrul SRL (Roménia)
Ventinveste, S.A.
Bunge Prio Cooperatie U.A.
Nutre Farming B.V.
Nutre – MZ
MANAGER:
Centralrest, Lda.
a) Positions outside the Group:
I’M - SGPS, S.A.
I´M Mining, SGPS, S.A.
ESTIA – SGPS, S.A.
ESTIALIVING, SGPS S.A.
Tavira Gran Plaza, SA
EPDM – Empresa de Perfuração e Desenvolvimento Mineiro, SA
Severis, SGPS S.A.
ESTIALIVING, SGPS S.A.
PCI - Parque de Ciência e Inovação, S.A.
Estia Retail & Warehousing S.R.L.
Mamaia Investments S.R.L.
OFFICE BUILDING VACARESTI SRL
MANAGER:
Exclusipolis, SGPS, Lda.
PANNN - Consultores de Geociências, Lda.
SOLE DIRECTOR:
Black and Blue Investimentos, S.A.
Expertoption, SGPS, SA
JORGE ALBERTO MARQUES MARTINS
a)
Positions within the Martifer Group:
Martifer Solar - SGPS, S.A.
Martifer Solar Ltda. (Brasil)
Martifer Renewables, SGPS, S.A.
MPRIME – Solar Solutions, S.A.
Martifer Renovables ETVE, S.A. (Espanha)
Martifer Renewables Investments ETVE, S.L.
SPEE 3 - Parque Eólico do Baião, S.A.
VICE-CHAIRMAN OF THE BOARD OF DIRECTORS:
Martifer Metallic Constructions - SGPS, S.A.
SPEE 2 – Parque Eólico de Vila Franca de Xira, S.A.
Martifer
Renewables Italy B.V. (Holanda)
Martifer Renewables Brazil B.V. (Holanda)
Martifer Beteiligungsverwaltungs GmbH (Austria)
Eviva Beteiligungsverwaltungs GmbH (Austria)
Martifer Deutschland GmbH (Alemanhã)
Martifer Renováveis Geração de Energia e Particip S.A.
Rosa dos Ventos Geração e Comerc. de Energia S.A. (Brasil)
Martifer – Construções Metálicas, Ltda (Brasil)
Martifer Wind Energy Systems LLC (EUA)
Martifer Construcciones Metálicas España, S.A.
MEMBER OF THE SUPERVISORY BOARD:
Martifer Renewables, SA (Poland)
MANAGER:
Martifer Contruções Metálicas Ltda.
Martifer – Aluminios, Ltda
Global Engineering & Consulting Limited
SOLE DIRECTOR:
Martifer Renewables Investments Etve, S.L.
CHAIRMAN OF THE REMUNERATION COMMITTEE:
Martifer Alumínios, S.A.
Martifer – Construções Metalomecânicas, S.A.
MEMBER OF THE REMUNERATION COMMITTEE:
SECRETARY:
Martifer Construcciones Metálicas España
REPRESENTATIVE:
EUROCAB FV 1, S.L.; EUROCAB FV 2, S.L.; EUROCAB FV 3, S.L.;
EUROCAB 19, S.L.
b)
Positions in companies with shareholding by Martifer Group:
MEMBER OF THE BOARD OF DIRECTORS
c)
Ventinveste, S.A.
Positions outside the Group:
I´M– SGPS, S.A.
I´M Mining, SGPS, S.A.
ESTIA SGPS, S.A.
MANAGER:
BRASEME -INVESTIMENTOS e Consultoria, Lda.
ARNALDO JOSÉ NUNES DA COSTA FIGUEIREDO
b) Positions outside the Group:
CHAIRMAN OF THE MANAGEMENT BOARD:
Mota-Engil, Indústria e Inovação, SA
VICE-CHAIRMAN OF THE MANAGEMENT BOARD:
Mota-Engil, SGPS, SA (vice-chairman and executive director)
MEMBER OF THE GENERAL BOARD:
AEM-Associação de Empresas Emitentes de Valores Cotados em
Mercado
ELO – Associação Portuguesa para o Desenvolvimento Económico e a
Cooperação
CHAIRMAN OF THE GENERAL MEETING:
Mercado Urbano – Gestão Imobiliária, S.A.
MEMBER OF DIRECTOR:
Tabella Holding, B.V.
PEDRO NUNO CARDOSO ABREU MOREIRA
Martifer Metallic Constructions, SGPS, S.A.
Martifer – Alumínios, S.A.
Gebox, S.A.
Nagatel Viseu - Promoção Imobiliária, S.A.
Martifer – Amal, S.A
Martifer Solar SGPS, S.A.
Martifer Solar, S.A.
Liszki Green Park Spółka Z Ograniczona Odpowiedzialnoscia (Polónia)
M-City Białystok Sp. Z O.O (Polónia)
M-City Szczecin Sp. Z O.O (Polónia)
Park Logistyczny Biskupice Sp. Z O.O. (Polónia)
Martifer Energia Ro (Roménia)
MANAGER:
Promoquatro - Investimentos Imobiliários Lda.
West Sea - Estaleiros Navais, Lda.
Does not take part on any other company outside Martifer Group.
LUIS ANTÓNIO DE CASTRO DE VALADARES TAVARES
Does not take part on any other company inside or outside Martifer Group.
JORGE BENTO RIBEIRO BARBOSA FARINHA
Does not take part on any other company inside or outside Martifer Group.
ANNEX III
[STATEMENT ON THE REMUNERATION POLICY OF THE MANAGEMENT AND SUPERVISORY BODIES APPROVED ON
TH
THE GENERAL MEETING ON 14 MAY 2015]
I - INTRODUCTION
In use of a legal right conferred by Article 399º of the Portuguese companies code (CSC), the Bylaws of Martifer SGPS, in its article
20, delegate to a Remuneration Committee the powers to decide on the remunerations of the Management and Supervisory Bodies
of the Company.
According to the applicable provisions of the Articles of Association, the Remuneration Committee was appointed by the
Shareholders General Meeting on281th April 2014, to exercise its duties for the three year period years 2012-2014 and currently is
formed by:
António Manuel Queirós Vasconcelos da Mota (President)
Maria Manuela Queirós Vasconcelos Mota dos Santos (Member)
Júlia Maria Rodrigues de Matos Nogueirinha (Member)
In order to promote a clear and legitimate fixing of the remuneration of corporate bodies, the Remuneration Committee, in
compliance with article 2 of Law 28/2009, of 19 June, hereby submits for approval of the General Meeting of Shareholders of
th
Martifer SGPS, S.A. of 14 May 2015, this declaration on the policy of remunerations of the Management and Supervisory Board.
This statement seeks to follow closely the applicable provisions of the CSC and the 2013 Corporate Government Code of Comissão
Mercado dos Valores Mobiliários (“CMVM”).
It is also relevant to point out that the present statement, more than mandatory by law, intends to be an important instrument of
good Corporate Governance, aiming the proper information of the shareholders, the protection of their interests and the
transparency of Corporate Governance in matters of remuneration of Corporate Bodies.
II – REGULATORY REGIME
In the definition of the remuneration policy to be established by the Remunerations Committee, were first taken into account the
legal provisions of CSC, namely in its article 399º; the Law 28/2009, 19 June, concerning the regime of approval and disclosure of
remunerations policy of the Management and Supervisory Bodies in Listed Companies, as well the 2013 Corporate Governance
Code of CMVM, in particular the provisions of Recommendation II.3.3.
In second place, it has also been taken into consideration, for the definition of the remuneration policy, the special regime
established in the Company’s Bylaws. The Portuguese Companies’ Code provides, in Article 399, the statutory scheme of
remuneration for the board of directors, which, in summary, establishes that:
-
The setting of the remunerations is a responsibility of the General Shareholders' Meeting or by a committee appointed by it for
this purpose and shall take into account the duties performed and the economic situation of the company;
-
The remuneration may be fixed or partially represent a percentage of the financial year´s profit, nevertheless the maximum
percentage allocated to the directors shall be authorized by a clause of the articles of association and shall not be levied on
the distribution of reserves or to any portion of the profits not legally available for distribution to the shareholders.
Regarding the members representing the Supervisory Board and the Board of the General Meeting the Portuguese Companies’
Code provides that remuneration shall consist of a fixed amount which is equally determined either on a General Shareholders'
Meeting or by a committee appointed by it for this purpose, taking into consideration each member's performance and the
company's economic situation.
Moreover, Articles 13 and 20 of the Articles of Incorporation state the following:
-
The remunerations of the members of the Corporate Bodies shall be fixed by the Remuneration Committee;
-
The General Meeting that elects the corporate bodies shall also elects the Remuneration Committee;
-
As The remuneration of the Board of Directors may be formedby a fixed part and a variable one , the latter representing a
percentage that can never exceed five per cent of the net profits for the year; and
-
The remuneration of the Supervisory Board shall consist of a fixed amount.
III – GENERAL PRINCIPLES
The Remunerations Committee pursues, in its remunerations policy, to promote the convergence of the interests of Directors, other
Corporate Bodies and Managers with the interests of the Company, namely shareholder value creation and real growth of the
Company, privileging here a long term perspective.
Pursuing this aspiration, and accordingly to the policy adopted in previous years, the Committee structured the integrant
components of the income of the Board of Directors in order to reward their performance, discouraging however excessive riskstaking. This way, it is intended to promote a high-level sustained growth.
Finally, it is relevant to say that is determinant in this Committee’s mission the economic position of the Company as well the
general market practices for similar situations.
Specifying the general policy herein stated, we hereby present to the shareholders the principals informants observed by this
Committee in the definition of the remunerations:
a) Interests alignment between the Management and Supervisory Bodies and the Company – Performance evaluation
In the decision of the remuneration of each member of the Board of Directors, shall be taken into account, for each single
member, the functions performed by individual members, the complexity of his duties, the responsibilities that are, in fact,
attributed to him, the time dedicated and the added value the result of his work brings to the Company.
In that extent, one cannot fail to differentiate the remuneration between the Executive Board members and the non-Executive
Board members, as well as the remuneration amongst each of the cited group.
There are also duties performed in other controlled companies which cannot be excluded from this consideration, as this means,
on one side, there is an increase in terms of responsibility and, on the other, in terms of the collective source of income.
b) Interests alignment between the Management and Supervisory Bodies and the Company – Performance evaluation
In order to grant an efficient alignment of interests of the Management and Supervisory Bodies with the ones of the Company,
this Committee shall not fail to pursue a policy that rewards the Board Directors by the performance of the Company in a long
term perspective and in the creation of value for the shareholder.
c) Economic position of the Company
This criterion has to be understood and interpreted carefully. The size of the Company and the inevitable complexity of
management associated to it is clearly one of the relevant aspects to determine the economic situation of the Company and of
remuneration, understood in its sense. To a higher level of complexity, corresponds a higher remuneration, but it has to be
adjusted accordingly to other criteria informants of the economic situation of the Company (of financial nature, human resources
nature, etc).
d) Market Criteria
The balance between supply and demand is unavoidable when setting any remuneration and the situation regarding members
of the Corporate Bodies is no exception. Only by taking into account market practices will allow the Company to maintain
professionals guided to perform at an adequate level of complexity and responsibility, It is important that the remuneration is
aligned with market practices and that it is stimulant, allowing it to become an instrument to help achieve a single and collective
high level of performance, thus ensuring not only the individual interest, but mostly the interests of the Company and of the
shareholders.
IV – CONCRETE OPTIONS
Based on the above mentioned principles, this Committee disclosure the relevant information regarding the concrete options of the
remunerations policy, which hereby are submitted to the Company’s shareholders appreciation:
1
st
Remuneration of Executive members of the Board of Directors, shall be made up of a fixed and, when so determined by the
Remuneration Committee, a variable part, and, according to the law and article 20.3 of the Articles of Association, the variable
part may not exceed 5% (five per cent) of the annual net profit.
2
nd
Remuneration for non-Executive independent members of the Board of Directors, members of the Supervisory Board and
members of the Board of the General Meeting shall only consist of a fixed part.
rd
3 The fixed part of the remuneration of the Executive members of the Board of Directors, as well the non-Executive Members non
independent (when applicable), shall consist in a monthly amount payable fourteen times per annum.
4
th
A fixed remuneration, for each participation in the meetings of the Board of Directors, shall be set for the non-Executive and
independent Board members.
5
th
Fixed remuneration of members of the Supervisory Board shall be set in a monthly value payable twelve times per annum.
6
th
In setting all remunerations, including in distributing the global amount of the variable pay of the members of the Board of
Directors, the general principles referred to above will be observed: functions carried out, alignment with the interests of the
company, privileging the long term, the company situation and market criteria.
7
th
Fixed remuneration of the members of the Board of the General Meeting will be a predetermined value for each meeting.
8
th
The process of attribution of variable remuneration to Executive members of the Board of Directors must follow the criteria
proposed by the Remunerations Committee, namely their hierarchal stand, evaluation of performance and real growth of the
Company, seeking to promote in those the convergence of the interests of the Management Body with the Company, with
emphasis on the long-term performance. Thus, will be considered decisive for the evaluation and measurement of the VR:




9
th
The contribution of the Executive Directors for the results obtained;
The profitability of business in the perspective of the shareholder;
The evolution of the stock quotes;
The degree of achievement of the projects integrated in and measured by the Balanced Scorecard of the Company.
Notwithstanding the policies above mentioned of protection of the shareholders and Company’s interests on the long term, the
Committee, in search of the best practices of Corporate Governance regarding remuneration policies of the Corporate Bodies,
continues: (i) promoting a study and comparative analysis of remuneration policies and practices of other groups of companies
in the same sector with respect to the fixing of remuneration for future implementation and adoption in Martifer, as well as (ii)
studying the possibility of adoption of politics that, shown to be feasible and balanced to all actors, foresee the possibility of the
variable remuneration – when attributed - to be payable, in part or totally, only after clearance of the fiscal accounts of all the
mandate and, on the other hand, that allows a limitation to the variable remuneration in case the results show a relevant
deterioration of the company’s Performance in the last cleared fiscal year or when it is expected in the designated year.
V – LIMITS
In case of verification of an permanent and not exceptional increase of the volume of activity associated with the exercise of the
functions by General Meeting and the Supervisory Board members, the maximum amount payable to the members of the governing
bodies, in particular the members of the General Meeting and the Supervisory Board may not exceed, respectively, either
individually or in aggregate, 25% of the average amount paid on the last 3 financial years, for the corresponding member of the
governing body.
VI – OTHER RESPONSIBILITIES
Regarding the process of hiring or appointing members to its governing bodies, the Company shall not enter into any contracts or
agreements with such members that allow the recognition or assignment of the right to receive payment of any damages or
compensation beyond the amounts legally payable, in the event of dismissal or termination of service.
It is our understanding that, in light of what is said in the above, these options should be maintained until the next General Meeting.
REPORT AND OPINION OF THE SUPERVISORY BOARD
On the consolidated Accounts of 2015
(TRANSLATION OF A REPORT ORIGINALLY ISSUED IN PORTUGUESE)
Dear Shareholders,
1.
In accordance with the law, the statutes and our mandate, we enclose our report on our supervisory activity and
our opinion on Martifer – SGPS, S.A. management report and consolidated accounts for the year ending 31st
December 2015, presented by the Board of Directors
2.
We followed regularly the activity of the company and of its major subsidiaries, having received from the
executive members of the Board and from company officials all required explanations and support for the
completion of our duties.
3.
We noted that the Group’s turnover increased 17 % to around 220.9 million euros, equity was reduced 24 % to
around 11.7 million euros, liabilities reached 595 million euros, to assets of around 606.6 million euros and the
Net Debt decreased 23 million euros, currently reaching around 260 million euros. The Net profit was positive in
around 1.2 million euros, which compares with -136-7 million euros in 2014.
4.
We accompanied the preparation of the consolidated accounts, the work of the statutory auditor with whom we
met and we reviewed the Legal Certification of Consolidated Accounts, issued without reservations or highlights,
which have our agreement.
5.
Within the scope of competence conferred upon us, we have found that:
a) The Consolidated Statements of Financial Position, the Consolidated Income Statements, the Consolidated
Statements of Comprehensive Income, the Consolidated Cash-flow Statements and the Consolidated
Statement of Changes in Shareholders’ Equity, and respective accompanying Notes give a true and fair view
of the Company and its subsidiaries financial position and financial results.
b) The accounting policies and valuation criteria used are in accordance with the International Financial
Reporting Standards (IFRS) as adopted by the European Union.
c) The Management Report shows a clear picture of the most significant aspects of the evolution of the
businesses and the position of the Company and its subsidiaries, describing clearly the most important
activities of the Group.
6.
Therefore, taking into account the information received from the Board of Directors and from the statutory
auditor, and the conclusions of the Legal Certification of Consolidated Accounts and the Auditor’s Report on
Consolidated Financial Statements issued by the external auditors, we are of the opinion that:
a)
The Management Report should be approved; and
b)
The Consolidated Financial Statements should be approved.
Oliveira de Frades, 26th April 2016
___________________________________________________
Chairman of the Supervisory Board
___________________________________________________
Member of the Supervisory Board
___________________________________________________
REPORT AND OPINION OF THE SUPERVISORY BOARD
On the individual Accounts of 2015
(TRANSLATION OF A REPORT ORIGINALLY ISSUED IN PORTUGUESE)
Dear Shareholders,
1.
In accordance with the law, the statutes and our mandated started from the General Meeting on 14 th May 2015
on, we enclose our report on our supervisory activity and our opinion on Martifer – SGPS, S.A. management
report and individual accounts for the year ending on 31st December 2015, presented by the Board of Directors
2.
We followed regularly the activity of the company and of its major subsidiaries, having received from the
executive members of the Board and from company officials all required explanations and support for the
completion of our duties.
3.
We accompanied the work of the statutory auditor, with whom we met, and we reviewed the Legal Certification
of Accounts, with no reservations and highlights, which has our agreement.
4.
In accordance with no. 4 of article 397 of the Portuguese Companies Code, the supervisory board issued the
following opinions about businesses between the companies’ and its board members:
5.
a)
Favourable opinion issued on 20th October 2015, regarding the sale of 100 % of the share capital of the
subsidiary MARTIFER – INOVAÇÃO E GESTÃO, S.A., headquartered in Zona Industrial de Oliveira de Frades,
parish of Oliveira de Frades, Souto de Lafões e Sejães and municipality of Oliveira de Frades, registered in
the trade register of Oliveira de Frades under the single number of register and tax 507 986 644, with a
share capital of € 100,000.00 (one hundred thousand euros), to the subsidiary MARTIFER METALLIC
CONSTRUCTIONS – SGPS, S.A., 75 % owned by MARTIFER SGPS, S.A., and 25 % owned by VECTOR DIÁLOGO –
SGPS, S.A., in which the board members Mr. Carlos Manuel Marques Martins and Mr. Jorge Alberto Marques
Martins indirectly own a 53.05 % share, through the company I’M, SGPS, S.A.;
b)
Favourable opinion issued on 14th December 2015, regarding the sale of 100 % of the share capital of the
subsidiary MARTIFER ENERGY SYSTEMS, SGPS, S.A., headquartered in Zona Industrial de Oliveira de Frades,
parish of Oliveira de Frades, Souto de Lafões e Sejães and municipality of Oliveira de Frades, registered in
the trade register of Oliveira de Frades under the single number of register and tax 508 338 352, with a
share capital of € 50,000.00 (fifty thousand euros), to the subsidiary MARTIFER METALLIC CONSTRUCTIONS –
SGPS, S.A., 75 % owned by MARTIFER SGPS, S.A., and 25 % owned by VECTOR DIÁLOGO – SGPS, S.A., in which
the board members Mr. Carlos Manuel Marques Martins and Mr. Jorge Alberto Marques Martins indirectly
own a 53.05 % share, through the company I’M, SGPS, S.A.;
c)
subsidiary MARTIFER GLOBAL, S.A., headquartered in Zona Industrial de Oliveira de Frades, parish of
Oliveira de Frades, Souto de Lafões e Sejães and municipality of Oliveira de Frades, registered in the trade
register of Oliveira de Frades under the single number of register and tax 510 364 705, with a share capital
of € 50,000.00 (fifty thousand euros), to the subsidiary MARTIFER METALLIC CONSTRUCTIONS – SGPS, S.A., 75
% owned by MARTIFER SGPS, S.A., and 25 % owned by VECTOR DIÁLOGO – SGPS, S.A., in which the board
members Mr. Carlos Manuel Marques Martins and Mr. Jorge Alberto Marques Martins indirectly own a 53.05 %
share, through the company I’M, SGPS, S.A.; and
d)
subsidiary GEBOX, S.A., headquartered in Zona Industrial de Oliveira de Frades, parish of Oliveira de Frades,
Souto de Lafões e Sejães and municipality of Oliveira de Frades, registered in the trade register of Oliveira
de Frades under the single number of register and tax 507 729 099, with a share capital of € 50,000.00 (fifty
thousand euros), to the subsidiary MARTIFER METALLIC CONSTRUCTIONS – SGPS, S.A., 75 % owned by
MARTIFER SGPS, S.A., and 25 % owned by VECTOR DIÁLOGO – SGPS, S.A., in which the board members Mr.
Carlos Manuel Marques Martins and Mr. Jorge Alberto Marques Martins indirectly own a 53.05 % share,
through the company I’M, SGPS, S.A..
Within the scope of competence conferred upon us, we have found that:
a)
The management report and financial statements show a clear picture of the financial position, financial
results and cash flows of the Company;
6.
b)
It is our duty to point out that the net profit in the period was positive in 1,401,241 euros, which compare
with -121,612,930 euros in 2014;
c)
The accounting policies and valuation criteria used, in accordance with the generally accepted accounting
principles in Portugal, are appropriate to understanding the net worth of the Company at the end of the
financial year and its results; and
d)
The proposal of results allocation is adequate under the current circumstances.
Therefore, taking into account the information received from the Board of Directors, from the statutory auditor
and the conclusions of the Legal Certification of Accounts, we are of the opinion that:
1)
The Management Report should be approved;
2)
The Individual Financial Statements should be approved;
3)
The proposal of results allocation should be approved.
___________________________________________________
___________________________________________________
___________________________________________________
STATEMENT OF COMPLIANCE
(In the terms of article 245, number 1, paragraph C of the Securities Code)
Dear Shareholders,
We hereby declare that as to the best of our knowledge:
i)
The information in the individual and consolidated financial statements, as well as in the appendices, was
compiled in accordance with the applicable accounting standards, giving a true and appropriate picture of the
assets and liabilities, financial position and performance of Martifer - SGPS, S.A. and of the companies included
in the consolidation perimeter;
ii)
The information contained in the Management Report truthfully represents the operational performance and
position of Martifer – SGPS, S.A. and the companies included in the consolidation perimeter, including a
description of the main risks and uncertainties faced by the company.
___________________________________________________
___________________________________________________
___________________________________________________
Audit Report for Statutory and Stock Exchange Regulatory Purposes on
the Consolidated Financial Information
Introduction
1
As required by law, we present the Audit Report for Statutory and Stock Exchange Regulatory
Purposes on the financial information included in the Directors’ Report and in the attached
consolidated financial statements of Martifer SGPS, SA, comprising the consolidated statement of
financial position as at December 31, 2015 (which shows total assets of Euro 606,631,099 and total
shareholder's equity of Euro 11,672,584 including non-controlling interests of Euro 28,377,206 and a
net loss of Euro 482.490), the consolidated statement of income by nature, the consolidated statement
of comprehensive income, the consolidated statement of changes in equity and the consolidated
statement of cash flows for the year then ended, and the corresponding notes to the accounts.
Responsibilities
2
It is the responsibility of the Company’s Board of Directors (i) to prepare the Directors’ Report
and the consolidated financial statements which present fairly, in all material respects, the financial
position of the Company and its subsidiaries, the consolidated results and the consolidated
comprehensive income of their operations, the changes in consolidated equity and the consolidated
cash flows; (ii) to prepare historic financial information in accordance with International Financial
Reporting Standards as adopted by the European Union and which is complete, true, up-to-date, clear,
objective and lawful, as required by the Portuguese Securities Market Code; (iii) to adopt appropriate
accounting policies and criteria; (iv) to maintain appropriate systems of internal control; and (v) to
disclose any significant matters which have influenced the activity, financial position or results of the
Company and its subsidiaries.
3
Our responsibility is to verify the financial information included in the financial statements
referred to above, namely as to whether it is complete, true, up-to-date, clear, objective and lawful, as
required by the Portuguese Securities Market Code, for the purpose of issuing an independent and
professional report based on our audit.
Scope
4
We conducted our audit in accordance with the Standards and Technical Recommendations
issued by the Institute of Statutory Auditors which require that we plan and perform the audit to
obtain reasonable assurance about whether the consolidated financial statements are free from
material misstatement. Accordingly, our audit included: (i) verification that the Company and its
subsidiaries’ financial statements have been appropriately examined and, for the cases where such an
audit was not carried out, verification, on a sample basis, of the evidence supporting the amounts and
disclosures in the consolidated financial statements and assessing the reasonableness of the estimates,
based on the judgements and criteria of the Board of Directors used in the preparation of the
PricewaterhouseCoopers & Associados - Sociedade de Revisores Oficiais de Contas, Lda.
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Inscrita na lista das Sociedades de Revisores Oficiais de Contas sob o nº 183 e na CMVM sob o nº 20161485
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consolidated financial statements; (ii) verification of the consolidation operations and the utilization of
the equity method; (iii) assessing the appropriateness of the accounting principles used and their
disclosure, as applicable; (iv) assessing the applicability of the going concern basis of accounting; (v)
assessing the overall presentation of the consolidated financial statements; and (vi) assessing the
completeness, truthfulness, accuracy, clarity, objectivity and lawfulness of the consolidated financial
information.
5
Our audit also covered the verification that the information included in the Directors’ Report is
consistent with the financial statements as well as the verification set forth in paragraphs 4 and 5 of
Article 451º of the Companies Code.
6
We believe that our audit provides a reasonable basis for our opinion.
Opinion
7
In our opinion, the consolidated financial statements referred to above, present fairly in all
material respects, the consolidated financial position of Martifer SGPS, SA as at December 31, 2015,
the consolidated results and the consolidated comprehensive income of its operations, the changes in
consolidated equity and the consolidated cash flows for the year then ended, in accordance with
International Financial Reporting Standards as adopted by the European Union and the information
included is complete, true, up-to-date, clear, objective and lawful.
Report on other legal requirements
8
It is also our opinion that the information included in the Directors’ Report is consistent with
the consolidated financial statements for the year and that the Corporate Governance Report includes
the information required under Article 245º-A of the Portuguese Securities Market Code.
April 22, 2016
PricewaterhouseCoopers & Associados
- Sociedade de Revisores Oficiais de Contas, Lda
Registered in the Comissão do Mercado de Valores Mobiliários with no. 20161485
represented by:
Hermínio António Paulos Afonso, R.O.C.
Audit Report for Statutory and Stock Exchange Regulatory
Purposes on the Consolidated Financial Information
31 December 2015
Martifer SGPS, SA
PwC 2 of 2
Audit Report for Statutory and Stock Exchange Regulatory Purposes on
the Individual Financial Information
Introduction
1
As required by law, we present the Audit Report for Statutory and Stock Exchange Regulatory
Purposes on the financial information included in the Directors’ Report and in the attached financial
statements of Martifer SGPS, SA, comprising the statement of financial position as at December 31,
2015 (which shows total assets of Euro 224,332,149 and total shareholder's equity of Euro 60,822,730
including a net profit of Euro 1,401,241, the statement of income by nature, the statement of
comprehensive income, the statement of changes in equity and the statement of cash flows for the year
then ended, and the corresponding notes to the accounts.
Responsibilities
2
It is the responsibility of the Company’s Board of Directors (i) to prepare the Directors’ Report
and the financial statements which present fairly, in all material respects, the financial position of the
Company, the results and the comprehensive income of its operations, the changes in equity and the
cash flows; (ii) to prepare historic financial information in accordance with International Financial
Reporting Standards as adopted by the European Union and which is complete, true, up-to-date, clear,
objective and lawful, as required by the Portuguese Securities Market Code; (iii) to adopt appropriate
accounting policies and criteria; (iv) to maintain an appropriate system of internal control; and (v) to
disclose any significant matters which have influenced the activity, financial position or results of the
Company.
3
Our responsibility is to verify the financial information included in the financial statements
referred to above, namely as to whether it is complete, true, up-to-date, clear, objective and lawful, as
required by the Portuguese Securities Market Code, for the purpose of issuing an independent and
professional report based on our audit.
Scope
4
We conducted our audit in accordance with the Standards and Technical Recommendations
issued by the Institute of Statutory Auditors which require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from material
misstatement. Accordingly, our audit included: (i) verification, on a sample basis, of the evidence
supporting the amounts and disclosures in the financial statements, and assessing the reasonableness
of the estimates, based on the judgements and criteria of the Board of Directors used in the
preparation of the financial statements; (ii) assessing the appropriateness of the accounting principles
used and their disclosure, as applicable; (iii) assessing the applicability of the going concern basis of
accounting; (iv) assessing the overall presentation of the financial statements; and (v) assessing the
completeness, truthfulness, accuracy, clarity, objectivity and lawfulness of the financial information.
PricewaterhouseCoopers & Associados - Sociedade de Revisores Oficiais de Contas, Lda.
o′Porto Bessa Leite Complex, Rua António Bessa Leite, 1430 - 5º, 4150-074 Porto, Portugal
Tel +351 225 433 000 Fax +351 225 433 499, www.pwc.pt
Matriculada na CRC sob o NUPC 506 628 752, Capital Social Euros 314.000
Inscrita na lista das Sociedades de Revisores Oficiais de Contas sob o nº 183 e na CMVM sob o nº 20161485
PricewaterhouseCoopers & Associados - Sociedade de Revisores Oficiais de Contas, Lda. pertence à rede de entidades que são membros
da PricewaterhouseCoopers International Limited, cada uma das quais é uma entidade legal autónoma e independente.
Sede: Palácio Sottomayor, Rua Sousa Martins, 1 - 3º, 1069-316 Lisboa, Portugal
5
Our audit also covered the verification that the information included in the Directors’ Report is
consistent with the financial statements as well as the verification set forth in paragraphs 4 and 5 of
Article 451º of the Companies Code.
6
We believe that our audit provides a reasonable basis for our opinion.
Opinion
7
In our opinion, the financial statements referred to above, present fairly in all material respects,
the financial position of Martifer SGPS, SA as at December 31, 2015, the results and the comprehensive
income of its operations, the changes in equity and the cash flows for the year then ended, in
accordance with International Financial Reporting Standards as adopted by the European Union and
the information included is complete, true, up-to-date, clear, objective and lawful.
Report on other legal requirements
8
It is also our opinion that the information included in the Directors’ Report is consistent with
the financial statements for the year and that the Corporate Governance Report includes the
information required under Article 245º-A of the Portuguese Securities Market Code.
April 22, 2016
PricewaterhouseCoopers & Associados
- Sociedade de Revisores Oficiais de Contas, Lda
Registered in the Comissão do Mercado de Valores Mobiliários with no. 20161485
represented by:
Hermínio António Paulos Afonso, R.O.C.
Audit Report for Statutory and Stock Exchange Regulatory
Purposes on the Individual Financial Information
31 December 2015
Martifer SGPS, SA
PwC 2 of 2

2015 Annual Report

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