Annual Report 2013-2014

Transcription

FUTEBOL CLUBE DO PORTO – Futebol, SAD
Listed Company
Share capital: 75.000.000 euros
Own Capital: 9.882.700 euros (approved in General Meeting on the 25th of November 2013)
Head Office – Estádio do Dragão, Via FC Porto, Entrada Poente Piso 3
Registration at 1st Registration of Commercial Registry of Porto and
Legal Person n.º 504 076 574
Management Report and Consolidated Accounts 2013/2014
A. Management Report
1. Message from the Chairman
2. Governing Bodies
3. Highlights
4. Activity Evolution
5. Other Facts that Occurred During the Financial Year
6. Relevant Facts Occurred after the End of the Financial Year
7. Future perspectives
8. Information on own shares
9. Statement of the Board of Directors
B. Consolidated Financial Statements and Appendix
1. Statements of Consolidated Financial Position
2. Consolidated Statements of Results by Category
3. Consolidated Statements of Comprehensive Income
4. Consolidated Statements of Changes in Equity Capital
5. Consolidated Statements of Cash flow
6. Notes to Consolidated Financial Statements
7. Legal Certification of Accounts and Audit Report
8. Report and Opinion of the Audit Committee
C. Corporate Governance Report
D. Shares held by members of the Board of Directors and Audit Committee
Consolidated Accounts Report
2013/2014
___________________________________________________________________________________________
A. Management Report
1. Message from the Chairman
FC Porto had a season below expectations. After three years of great success, having been national
champion three years in a row, the main objective of the team, and an European competition, we had
a negative year, which we used to do a complete restructuring of the professional squad, including
hiring Julen Lopetegui as coach of the team
We aimed at hiring players with proven quality, all youngsters, offering us excellent prospects to
achieve not only immediate results, but also for midterm results, starting a new cycle of victories.
At the same time, we gave the group the necessary financial tools to adapt to the UEFA regulations,
the so called financial fair-play, assuring us for the future.
As they say, we took one step back to take two or three forward. That has been our path since the
creation of the company and I am certain it will remain that way.
Jorge Nuno Pinto da Costa
___________________________________________________________________________________________
Futebol Clube do Porto – Futebol, SAD
2
2013/2014
___________________________________________________________________________________________
2. Governing Bodies
General Meeting
Chairman:
Secretary
Board of Directors
Chairman:
Directors:
Audit Committee
Chairman:
Members:
– José Manuel de Matos Fernandes
– Rui Miguel de Sousa Simões Fernandes Marrana
– Jorge Nuno de Lima Pinto da Costa
– Adelino Sá e Melo Caldeira
– Fernando Manuel Santos Gomes
– Reinaldo da Costa Teles Pinheiro
– Rui Ferreira Vieira de Sá (non-executive)
– José Paulo Sá Fernandes Nunes de Almeida
– Armando Luís Vieira de Magalhães
– Filipe Carlos Ferreira Avides Moreira
Audit Firm
Deloitte & Associados, SROC SA, represented by António Manuel Martins Amaral
Company Secretary
Secretary:
Substitute:
Advisory Board
Chairman:
Members:
Remuneration Committee
Chairman:
Members:
– Daniel Lorenz Rodrigues Pereira
– Raul Filipe Pais da Costa Figueiredo
– Alípio Dias
– Álvaro Jose Pereira Pinto Júnior
– Álvaro Rola
– António Fernando Maia Moreira de Sá
– António Manuel Gonçalves
– Artur Santos Silva
– Fernando Alberto Pires Póvoas
– Fernando José Guimarães Freire de Sousa
– Fernando Manuel dos Santos Gomes
– Ilídio Costa Leite Pinho
– Ilídio Pinto
– Jaime Eduardo Lamego Lopes
– João Espregueira Mendes
– Jorge Nuno de Lima Pinto da Costa
– Joaquim Manuel Machado Faria e Almeida
– José Alexandre de Oliveira
– José Paulo Sá Fernandes Nunes de Almeida
– Jorge Alberto Carvalho Martins
– Luís Portela
– Rui de Carvalho de Araújo Moreira
– Alípio Dias
– Fernando José Guimarães Freire de Sousa
– Joaquim Manuel Machado Faria e Almeida
___________________________________________________________________________________________
3
2013/2014
___________________________________________________________________________________________
3. Highlights
•
Negative Consolidated Net Incomes of 40,701m€, far inferior to the one obtained in the previous
period, with positive 20,356m€, caused essentially by the fewer gains obtained from the trade of
players. EBITDA (Operational Cash-Flow) remained positive, at 1,817m€;
•
Operational Gains, excluding the trade of players, are down by 5,829m€, reaching 72,613m€,
which still represents a decrease inferior to the revenues from European competitions;
•
Costs with staff decreased 5,180m€, representing a decrease of 10% in comparison to the previous
period, excluding the trade of players, set at 1,410m€;
•
Incomes from the trade of players reached 23,907m€, representing a decrease of 52,538m€ in
comparison to 2012/2013, as the sale of sporting rights of players this season was far inferior to
the previous season, leading to a decrease in operational gains, which reached negative 25,786m€;
•
The gains disclosed do not include the trade of Mangala to Manchester City, for 30,500m€, as it
was done after the period was closed.
•
Despite the negative result, the Company remains within the value recommended by UEFA in
terms of Salaries vs. Operational Gains ratio (70%), excluding the gains with trade of players,
showing a value of about 67% for 2013/2014;
•
Total Net Assets decreased 12% as of the 30th of June 2013, reaching a global amount of
200,396m€, considering the for the decrease in accounts from clients and for the trade value of
the squad;
•
Total Liabilities increased 6%, to 233,463m€, with a bigger impact to the current component. The
Board is analysing the possibility of a financial operation to restructure that Liability to distribute
the debt on the long term;
•
Negative individual Equity Capital, reaching 28,512m€ as of the 30th of June 2014, due to the net
result of that period;
•
By the end of the first semester of the 2014/2015 period, the Company is expecting to once again
present positive Equity Capital, considering the increase of Equity of the Company in 37,500m€,
caused by the cash influx from the private subscription by Futebol Clube do Porto of 7,500,000
preferential stocks, without par value, to be issue by the Company, as approved in the General
Meeting of the 2nd of October.
___________________________________________________________________________________________
4
2013/2014
___________________________________________________________________________________________
4. Activity Evolution
FC Porto – Futebol, SAD fulfils its obligations to present economic and financial information, regarding
the financial year of 2013/2014, from the 1st of July 2013 to the 30th of June 2014.
This document has been executed in compliance with the current legal framework, namely the
provisions of the Companies Code, the Securities Code and the regulations of the Portuguese Securities
Market Commission (Comissão do Mercado de Valores Mobiliários – CMVM).
As required by the regulations of the European Parliament, companies with shares traded in regulated
markets seated in the European Union must use, in their consolidated financial statements, the
international accountancy standards (IAS/IFRS) adopted by the Union for all the financial years starting
on or after the 1st of January 2005.
Regarding FC Porto – Futebol, SAD, these regulations started on the fiscal year of 2005/2006. The
accounts presented for each quarter, and this annual report, were drawn up in accordance with the
international accountancy standards.
___________________________________________________________________________________________
5
2013/2014
___________________________________________________________________________________________
SUMMARY OF SPORTING ACTIVITY
The season 2013-14 started positively, with FC Porto winning another SuperCup and adding to the
history of absolute dominance in the competition. In Aveiro, against Vitória SC, in a stadium brimming
with celebration, the white and blue team won with an undisputable score of 3-0.
The weeks that followed seemed to indicate a good start in the league for FC Porto, a pace that would
prove to be irregular and ended up meaning a premature drop from the first position, a usual position
for FC Porto in last three decades.
For the UEFA competitions, despite having had good performances in the group, FC Porto missed the
qualification in Group G of the UEFA Champions League by a few inches, then moving on to the UEFA
Europa League, where they were able of eliminating Eintracht Frankfurt and Napoli, before being
eliminated by Sevilla (who would win the competition).
As for domestic competitions, FC Porto was able to qualify for several rounds of the Portuguese Cup,
being eliminated in the semi-finals, played in two legs.
At that time, the team was led by Luís Castro, who started has the coach of the B team, but ended up
being invited to lead the main squad, after the Paulo Fonseca mutual termination of contract with
Paulo Fonseca.
By the end of the period in analysis, the Board decided to present Spanish coach Julen Lopetegui as
the future coach of a squad with several well-known players, with the intention of resuming the path
of sporting success that has been the trend in the last years, interrupted in 2013-14.
Apart of the arrivals of Andrés Fernandez, Ricardo Nunes, Opare, Indi, Marcano, José Angel, Casemiro,
Campaña, Evandro, Oliver Torres, Brahimi, Otávio, Adrián Lopez, Tello and Aboubakar, several players
were traded out, including Fernando and Mangala, both to Manchester City.
The participation in the 2014-15 edition of the UEFA Champions League, reached after beating Lille in
the qualification play-off, put FC Porto in a small elite: the club holds the record of participations in the
competition (19), along with Manchester United, Barcelona and Real Madrid.
___________________________________________________________________________________________
6
2013/2014
___________________________________________________________________________________________
ECONOMIC ACTIVITY
The 2013/2014 season will remain in history as one of the most modest for Futebol Clube do Porto –
Futebol, SAD. Not only was the sporting result below expected, as the team only won the SuperCup
Cândido de Oliveira, something unseen in the last years, the Company had the worst economic and
financial net results ever, of around negative 40,701m€.
The economic and financial situation of the Company, analysed in this report, will reflect the
consolidated result, meaning, the results obtained through the individual participations of the
companies of the group included in the consolidation perimeter (FC Porto – Futebol, SAD,
PortoComercial, PortoEstádio, PortoMultimédia, PortoSeguro and Dragon Tour – and, after
2013/2014, also PortoMedia), net of the transactions done among them. Despite the fact that the
business volume of PortoComercial keeps gaining significance in the group, it is still FC Porto – Futebol,
SAD, individually, that is contributing the most for the consolidated results presented.
The period in analysis has, for the first time, the participation of the activity developed by FC Porto
Media, SA. On the 30th of July 2013, FC Porto – Futebol, Sad increased capital, by 4,000m€, in FC Porto
Media, becoming the biggest shareholder of the Company, with a direct participation of 98.78%
(corresponding to 98.81% directly and indirectly). This company’s main goal is the conception,
creation, development, production, recording, promotion, sale, acquirement, display, distribute and
broadcast of audio-visual works and programs, multimedia, television, video, cinema, theme networks,
internet, events regarding tourism, culture and sports, in any formats and system; management, use
and offer of services in the fields of recording, production and communication of audio-visual works,
TV shows, sound, images, multimedia, or any other audio-visual means; edition of periodical
publishing, books and multimedia. Still, the biggest project of this company is the TV network “Porto
Canal”.
Further ahead in this report, there is a summary of the individual results of each company in the
consolidation perimeter, and for now the focus will remain in the analysis of the last two years of
consolidated results.
As mentioned in previous reports, FC Porto – Futebol, SAD, and other Companies in this field of activity,
balance their budgets with gains obtained from trading players. The revenues described in this section,
___________________________________________________________________________________________
7
2013/2014
___________________________________________________________________________________________
which have been a major part of the gains of the Company, are fundamental for the balance of its
budget. The variations in this section are the main cause for positive/negative results of FC Porto –
Futebol, SAD. In this summer’s Transfer Market, and until the end of the current period, there were
not enough gains from the trade of players to cover the costs, as the Company delayed those trades in
order to maximize the possible gains, as happened with the sale of the player Mangala, on the 11th of
August, to Manchester City for 30,500m€.
This means that, in the period analysed, there were gains of 23,907m€, far below the usual amount
the Company achieves, resulting in negative 40,701€. The previous period had gains of around
76,445m€, which led to a net result of 20,356m€.
This result is composed of three different results:
• Operational results excluding the trade of players;
• Results related to the trade of players;
• Financial and obtained from investments results (plus taxes over income)
___________________________________________________________________________________________
8
2013/2014
___________________________________________________________________________________________
All these results had a negative behaviour in comparison to the previous period. The first component,
operational results excluding the trade of players, is the most stable throughout the periods, as they
hold recurring gains and costs year after year, and they are obtained mostly by long term contracts.
The second component, the trade of players, is the most volatile, and reflects the decisions of the
Board to, each year, reinforce, keep or let go of players in the squad. These decisions are usually the
main responsible for positive/ negative results in the Company. Lastly, the financial results show the
need for funds and access to credit of the Company.
By analysing the operational gains, excluding the trade of players, it is noticeable that there was a
significant drop in the income obtained in European competitions, which made a significant impact,
leading to a 7% break in total.
values in thousand euros
Operational Gains, excluding the trade of passes
2013/2014
%
2012/2014
%
Merchandising
3.720
5%
2.786
4%
Tickets
6.228
9%
6.521
8%
UEFA Competitions
9.552
13%
20.390
26%
Other Sporting Revenues
2.400
3%
1.136
1%
TV rights
15.928
22%
13.185
17%
Publicity and Sponsorship
13.594
19%
13.067
17%
Corporate Hospitality
14.353
20%
15.161
19%
Other Services
4.923
7%
5.091
6%
Other Gains
1.915
3%
1.105
1%
TOTAL
72.613
100%
78.441
100%
Opposing all statistics on consumerism in Portugal, the merchandising numbers increased by 34% in
this period, which is remarkable in the current economic context.
The gains from tickets, which include the sales of Dragon Seats (season tickets), game tickets and
quotas paid by the associates, decreased by 4% in 2013/2014, to 6,228m€. Despite the increase in
game tickets in this period, with the bigger number of European matches, the drop in sales of Dragon
Seats led to a decrease of 293m€ in gains from tickets.
___________________________________________________________________________________________
9
2013/2014
___________________________________________________________________________________________
The bad sporting performance in European competitions led to a decrease in revenues for the
Company of 10,838m€. the fact that the team didn’t make it to the Round of 16 of the UEFA Champions
League, being demoted to the UEFA Europa League (where the team made it to the quarter-finals) –
with lower prize money –, partly explain the difference to the previous period, which had prize money
for four victories and one tie, and the prize for the qualification to the Round of 16.
In addition to that, the accounting policy adopted by the Company implicates that the set prize for the
access to the UEFA Champions League is only accounted in the period where it was obtained, which
means that this period only had 2,100m€ for the play-off of the competition in 2014/15. The 8,600m€
that the Company won for playing the 2013/2014 edition were recorded in the 2012/2013 numbers,
when the team assured the access to the competition for the next season.
Under “Other Sporting Gains” are accounted the gains regarding the participation in other sporting
competitions other than the UEFA Champions League – the Portuguese Cup, the Supercup Cândido de
Oliveira, the League Cup and the pre-season tournaments – and the gains from the Dragon Force. The
high gains achieved for the participation of the team in tournaments in the Latin America and the
London Tournament, at the start of the season, led to an increase of 1,265m€ in this category.
Gains from broadcasting rights grew by 2,743m€ in comparison to last year. Part of this growth is due
to the progressive gains assured by the contract between FC Porto – Futebol, SAD and PPTV –
Publicidade de Portugal e Televisão S.A. (a company part of Grupo Controlinveste, which is the
contracting entity of Olivedesportos – Publicidade, Televisão e Media S.A.), for the exclusive rights of
audio-visual communication, national and international, of the FC Porto games played for the main
competition of the Portuguese League for Professional Football when playing at home. Still, the period
analysed also includes the revenues from distribution rights of PortoCanal, around 1,628m€, by
PortoMedia, who joined the Company during the 2013/2014 period.
The gains from advertisement and sponsorship come mainly from the advertisement made in the
official FC Porto gear, by their main sponsors, which were, in 2013/2014, Portugal Telecom, Nike and
Unicer. Apart from the growing set amounts throughout the season, contracts include performance
prizes, which, considering the sporting performance of this period, were below the previous season.
The commercialization of advertisement supports by PortoComercial remained stable, but it was the
gains obtained by the newest company to enter the consolidation perimeter, PortoMedia, that
contributed the most to an increase in this category, by 527m€.
___________________________________________________________________________________________
10
2013/2014
___________________________________________________________________________________________
The item “Corporate Hospitality” includes the gains regarding the management and exploration of this
segment, which belong to the companies analysed here. This business, in short, includes the availability
of a set of products and services meant for companies and include the use of cabins and seats for
companies at the Estádio do Dragão to attend the team matches. These services are billed by
PortoComercial and redirected to the company EuroAntas, held by FC Porto (Club), who uses these
gains to address the debt for the building of the stadium. The amount in excess from this business,
after all the agreements with the project finance are met, is then offered to the sporting company.
This amount was below the previous period as the associated costs were far superior, given the bigger
number of European matches.
The remaining operational gains, still not mentioned, described in the category “Other Services” and
“Other Gains”, come from operational gains of the companies, excluding the already mentioned
Merchandising gains, Rights to Broadcast, Advertise and Sponsor of PortoCanal and PortoMedia. These
gains increased by 642m€ in total.
Below is a graphical representation of the evolution of operational gains, excluding the trade of
players, considering the variables described.
___________________________________________________________________________________________
11
2013/2014
___________________________________________________________________________________________
Now taking in consideration the structure of operational costs, excluding the costs with the trade of
players, there was a decrease of 1,410m€ in comparison to 2012/2013, reaching 95,175m€ in this
period.
Operational Costs excluding costs with passes
2013/2014
%
2012/2013
%
CMV
2.607
3%
2.065
2%
External Supplies and Services
42.048
44%
37.499
39%
Costs with Staff
48.885
51%
54.065
56%
Amortizations excluding depreciation of passes
559
1%
716
1%
Provisions and impairment losses excluding passes
-86
0%
-733
-1%
Other costs
1.162
1%
2.974
3%
TOTAL
95.175
100%
96.585
100%
Following the increase of the merchandising sales, the sales on assets also increased, even if by a lower
percentage, leading to an improvement in this result.
The increased observed in terms of external services is explained by the costs in travelling and stays
during the participation in the pre-season tournaments played in Latin America, but also, and above
all, by the integration of the costs of PortoMedia.
A positive fact in this period is the decrease in costs with personnel, in comparison to the previous
year, by 5,180m€. Despite the inclusion of costs with salary of the employees of PortoMedia, the
decrease in the prizes associated with sporting performance, to be paid to the players, allowed for a
considerable saving to the Company.
Amortizations, excluding devaluation of passes, which have very little impact in the structure of the
costs of the Company, as they reach 1% in total, decreased around 22% in comparison to the last
period.
___________________________________________________________________________________________
12
2013/2014
___________________________________________________________________________________________
The category “Provisions and impairment losses excluding passes” has both the record of new
provisions and impairment losses and the reversion of the ones done before, if the circumstances from
which they originated from were dealt with. This category presents a negative value in both periods,
which means that their total value was above that of the new impairments recorded.
“Other costs”, where lesser, unmentioned, costs are represented, reach only 1% in total, in this period.
In 2012/2013, this category had a bigger impact as it included the repurchase of 15% of the economic
rights of João Moutinho, who ended up being transferred in that period for 25,000m€.
The graphic below shows a global representation of 1,410m€ in operational costs, excluding costs with
trade of players, justified by the described variables.
The net value resulting from the sum of operational gains and costs, excluding trades of players,
reached a global negative value of 22,562m€, representing a decrease of 4,419m€ in comparison to
the previous period.
___________________________________________________________________________________________
13
2013/2014
___________________________________________________________________________________________
It is now important to add to this analysis the second component of the net result, regarding the trade
of players (Amortizations and impairment losses with trade of players and the Result of Transactions
from the Trade of Players) which, in FC Porto – Futebol, SAD, have an undeniable and determinant
weight for the results of the Company. In this period, this balance is negative, which is unusual.
With a negative impact on the results of the Company, amortizations and impairment losses with trade
of players reached 27,131m€, representing an increase of 2% in comparison to the previous period,
associated to an increase in cuts and impairment losses with the trade of players, as amortizations
remained stable.
The Result from Trade of Players, including costs and gains from selling and loaning the sporting rights
of players, has usually been a positive category in the financial reports of the group. The 23,907m€ of
the results obtained basically came from the net assets (the costs of each business and the accounting
net value must be subtracted from any sale value) which result from the sales of sporting and economic
rights of players to other clubs/entities, and have been a substantial part of the gains of FC Porto –
Futebol, SAD and many Companies in the same activity, allowing for the balance of results. The net
assets obtained from trading players have been growing gradually throughout the seasons, but
decreased abruptly in this period by 52,538m€. The period of 2013/2014 includes the sale of sporting
rights of players Otamendi, Iturbe and Fernando to Valencia, Hellas and Manchester City, by 12,000,
15,000 and 15,000m€, respectively. Still, considering that the passes of the first two were shared by
___________________________________________________________________________________________
14
2013/2014
___________________________________________________________________________________________
other entities, the assets obtained by FC Porto – Futebol, SAD were considerably reduced. In the
previous period, the assets from selling players Alvaro Pereira and Hulk, to Inter Milan and Zenit, for
10,000 and 40,000m€, respectively, at the start of the period and, closer to the end, of João Moutinho
and James Rodríguez, to Monaco, for 25,000m€ and 45,000m€, respectively.
The results with the trade of players, which was not enough to compensate for the negative
contribution of Amortizations and impairment losses with passes, resulted in a negative balance of
3,224m€. This is the exact cause why the operational results (results before the costs and financial
gains, results regarding investments and taxes over income) were drastically reduced, going into
negative 25,786m€, representing a break of 57,561m€ in comparison to the previous season.
Lastly, the third component, financial.
In this period, there was a reduction in financial costs, caused by the decrease in costs supported by
interests. Still, financial gains also decreased, regarding the update in deadlines for incoming accounts.
Considering the decrease in gains exceeded the decrease in costs, the financial gains aggravated by
1,048m€ in comparison to the previous period.
___________________________________________________________________________________________
15
2013/2014
___________________________________________________________________________________________
The results regarding investments, which include the results obtained in investments in economic
rights of players of which the Company does not fully hold, improved 216m€ in this period, despite
remaining negative.
Lastly, the last category in the results of the Group, the tax over income of the period, reached
3,220m€. this number, compared to the previous period, grew significantly, as FC Porto – Futebol, SAD
joined a special regime to address tax debts, which hurt the results of the Group in 2,714m€, in this
period. Still, the company will keep building a case to address the audits established, which may mean
the inversion of part of these costs in the next periods.
To conclude this analysis, the Consolidated Net Result of the Company was negative by 40,701m€,
attributable to owners of own capital of the mother-company.
Still, what EBITDA – the operational cash-flow measured by the operational result, net amortizations,
impairment losses and provisions – shows is that, despite presenting a considerable decrease, it
remains positive in this period, by 1,817m€.
___________________________________________________________________________________________
16
2013/2014
___________________________________________________________________________________________
Even if the accounting of the Company is openly negative, it matters to present a fundamental
indicator in this sector of activity, which shows the weight that the costs with staff have on the gain
structure. Using an indicator that has been frequently used by experts in the financial analysis of the
world of football, this ratio, which must not include gains from trade of players, has to be below 70%,
as recommended by UEFA. As the following graphic shows, the Company has been able to keep that
ratio under the number advised, despite the club’s constraints, as a club of a small country, in raising
normal ticket sales (tickets, television revenues and advertisement), in comparison to major European
clubs, in order to retain the same competitiveness and pay lower salaries.
Now moving on to the situation of patrimony of the Group on the 30th of June 2014, the negative own
capital is highlighted, due to the inclusion of the net result presented. The individual own capital of FC
Porto – Futebol, SAD reach negative 28,512m€, so the Company is still under article 35º of the
Portuguese Companies Code.
Regarding the net assets, which reach 200,396m€, there was an overall decrease of 27,457m€, in
comparison to the 30th of June 2013, split by the short and long term component. A big part of that
decrease is based on the drop of amounts being received by clients; still, there was also a decrease in
accounting value on the squad, which now reaches 61,506m€, even if that doesn’t fully reflect the
value of the market, as the Company has been receiving relevant assets in the sale of those rights.
___________________________________________________________________________________________
17
2013/2014
___________________________________________________________________________________________
The total liability of the Group reached, as off the 30th of June 2014, 233,463m€, representing an
increase of 6% in comparison to the 30th of June of the previous year.
___________________________________________________________________________________________
18
2013/2014
___________________________________________________________________________________________
The structure of the liability appears penalized, in comparison to the 30th of June 2014, due to the
proximity of a reimbursement of one of the bond loan, reaching 30M€. At the moment, the Company
has two bond loans active, one for 30M€, to be reimbursed on the 21st of May 2015 and a second one
for 20M€, which will be fully paid on the 6th of June 2017. The Board of Directors is considering a
financial operation to restructure that liability, to settle a significant part of it on the long term.
As stated, FC Porto – Futebol, SAD is, as off the 30th of June 2014, under the terms of article 35º of the
Portuguese Companies Code, with its own capitals, on an individual level, representing less than half
the social capital.
To reinforce the own capital, on the 2nd of October, Futebol Clube do Porto – Futebol, SAD, in a special
General Meeting, approved, among other things, the increase of the social capital of the Company by
37,500m€, allowed by the cash inflow through the private subscription by Futebol Clube do Porto of
7,500,000 shares, not carrying voting rights, to be emitted by the Company.
___________________________________________________________________________________________
19
2013/2014
___________________________________________________________________________________________
INDIVIDUAL PERFORMANCE OF THE COMPANIES IN THE CONSOLIDATION PERIMETER
The numbers shown so far present the consolidated economic and financial situation of FC Porto –
Futebol, SAD, which means that the accounting of all the seven companies (six in 2012/2013) in the
consolidation perimeter are taken into account.
Below is the individual performance of each of them, before the consolidation adjustments:
FC Porto
Porto
Porto
Porto
Porto
Dragon
Porto
Futebol, SAD
Comercial
Estádio
Multimédia
Seguro
Tour
Media
Companies in the group
Operational Gains excluding Trade of Players
48.791
19.196
3.798
648
955
2.787
2.927
Operational Costs excluding Trade of Players
(69.658)
(20.630)
(3.901)
(305)
(573)
(2.817)
(3.780)
Operational Results excluding Trade of Players
(20.867)
(1.434)
(102)
343
381
(30)
Amortizations and Impairment loses with Trades
(27.131)
-
-
-
-
-
-
23.907
-
-
-
-
-
-
(24.091)
(1.434)
(102)
343
381
(30)
(854)
Financial Results
(9.759)
(411)
(0)
-
0
(0)
-
Results related to Investments
(1.532)
-
-
-
-
-
-
Taxes over Income
(3.013)
(39)
(40)
(12)
(93)
(6)
(18)
(38.395)
(1.883)
(143)
331
289
(36)
(872)
(Costs)/Gains with Trades
Operational Results
Net Result of the year
The table above shows that the consolidated result reached by FC Porto – Futebol, SAD was achieved
almost exclusively by the individual result of the Company. Still, the aggregate of the other companies
part of the consolidation perimeter was also negative, leading to a decreased individual result.
___________________________________________________________________________________________
20
(854)
2013/2014
___________________________________________________________________________________________
5. Other Facts Occurred During the Exercise
•
On the 30th of July 2013, FC Porto – Futebol, SAD did an increase to capital by 4,000m€ on FCP
Media, SA with the social object “Activities regarding Public Relations and Communication.
Conception, creation, development, production, recording, promotion, sale, acquirement, display,
distribute and broadcast of audio-visual works and programs, multimedia, television, video,
cinema, theme networks, internet, events regarding arts, culture and sports, in any formats and
system; management, use and offer of services in the fields of recording, production and
communication of audio-visual works, TV shows, sound, images, multimedia, or any other audiovisual means; edition of periodical publishing, books and multimedia; providing of services related
to those activities”, does become the main shareholder.
•
Following the emission of bonds by the Company, there was a payment of interests on coupon n.
2 and n. 3 of the bonds “FC PORTO SAD MAIO 2015”, on the 21st of November 2013 and 21st of
May 2014, respectively. The reimbursement of the operation will occur on the 21st of May 2015,
as set in the prospect of public offer.
•
Following the emission of bonds by the Company, there was a payment of interests on coupon n.
5, on the 3rd of December 2013, and the payment of interests on coupon n. 6 and reimbursement
of bonds “FC PORTO SAD 201-2014”, on the 3rd of June 2014, as set in the terms for the loan,
included in the public offer.
•
Angelino Cândido de Sousa Ferreira renounced, on the 19th of February 2014, to his role as Director
of FC Porto – Futebol, SAD, starting as off the 31st of March 2014. On that same day, Fernando
Manuel Santos Gomes was appointed to replace him.
•
On the 5th of March 2014, FC Porto – Futebol, SAD reached an agreement to terminate the contract
with Paulo Fonseca from coach of the main squad. Luís Castro took over the role of interim coach
on the same day.
•
The Company reached an agreement on the 6th of May 2014 with Julen Lopetegui to become the
coach of the main squad, valid for 3 sporting seasons.
___________________________________________________________________________________________
21
2013/2014
___________________________________________________________________________________________
•
On the 4th of June 2014, in a special regulated market session, the result of the Public Offer for
Subscription of Bonds “FC PORTO SAD 2014-2017” was presented. The offer was composed of 4
million bonds (after the emission was broadened), worth 5€ (global amount: 20,000m€), but the
demand was over 51.9 million bonds (worth 259,000m€), which means it surpassed the offer by
12.98 times, leading to a ratio of around 0.0742. it should be noted that the demand fully
surpassed the offer on the first day, after the extended emission, with 32.2 million bonds and 8,442
investors.
___________________________________________________________________________________________
22
2013/2014
___________________________________________________________________________________________
6. Relevant Facts that Occurred after the Term of the Period
•
On the 12th of July 2014, FC Porto – Futebol, SAD reached an agreement with Club Atlético de
Madrid for the acquisition of the sporting rights, and 60% of the economic rights, of professional
player Adrián López Álvarez, for 11,000m€. The player signed a contract valid for 5 sporting
seasons, with a release fee of 60,000m€.
•
On the 15th of July 2014, FC Porto – Futebol, SAD reached an agreement with Feyenoord Rotterdam
for the acquisition of sporting rights, and full economic rights, of professional player Bruno Martins
Indi, for 7,700m€. The player signed a contract valid for 4 sporting seasons, with a release fee of
40,000m€.
•
On the 16th of July 2014, the Company assured the rights to inscribe player Cristian Tello Herrera,
from Futbol Club Barcelona, for 2 sporting seasons, with a purchase fee for the sporting and
economic rights.
•
On the 19th of July 2014, the Company assure the rights to inscribe player Carlos Henrique
Casemiro, from Real Madrid Club de Fútbol, until the 30th of June 2015, with a purchase fee for the
sporting rights.
•
On the 22nd of July 2014, FC Porto – Futebol, SAD reached an agreement with Granada Club de
Fútbol for the acquisition of the sporting rights, and full economic rights, of professional player
Yacine Brahimi, for 6,500m€. The player signed a contract valid for 5 sporting seasons, with a
release fee of 50,000m€. On the 24th of July 2014, the Company alienated, under economic
association, 80% of the economic rights of this athlete for 5,000m€, to Doyen Sports Investments
Limited.
•
On the 2nd of August 2014, FC Porto – Futebol, SAD extended, for an extra year, until the 30th of
June 2017, the contract binding the Company and player Jackson Martínez, changing his release
fee to 35,000m€. In this renewal process, 5% of the net value of any future transfer was conceded
to his agent – Luiz Henrique Ferreira Pompeo –, as a prize for the negotiations with the athlete.
___________________________________________________________________________________________
23
2013/2014
___________________________________________________________________________________________
•
On the 11th of August 2014, FC Porto – Futebol, SAD reached an agreement with Manchester City
for the full transfer of sporting rights, and the 56.67% of economic rights held by the Company, of
professional player Eliaquim Mangala, for 30,500m€.
•
On the 13th of August 2014, FC Porto – Futebol, SAD, the Company reached an agreement with
Royal Sporting Club Anderlecht for the full transfer of the sporting rights of professional player
Steven Defour, for 6,000m€. The agreement for this transfer included the payment of a variable
prize, which means the total amount may reach 6,500m€.
•
On the 24th of August 2014, FC Porto – Futebol, SAD reached an agreement with Football Club
Lorient Bretagne Sud for the transfer of sporting rights, and 30% of economic rights, of professional
player Vincent Aboubakar, for 3,000m€. The player signed a contract valid for 4 sporting seasons,
with a release fee of 50,000m€.
•
On the 2nd of October 2014, FC Porto – Futebol, SAD gathered in special General Meeting, having
approved, among others, the following orders:
o
Increase of social capital of the Company by 37,500m€, through the cash influx by the private
subscription by Futebol Clube do Porto of 7,500,000 shares, without vote rights, to be issued
by the Company.
o
The acquisition, by the Company to Futebol Clube do Porto, of shares representing 50% of the
social capital of the company EuroAntas, a company whose main asset is Estádio do Dragão,
with an evaluation report being presented, by the independent Auditor, setting its value at
110,120,750 Euros.
•
On that same day, the 2nd of October, Futebol Clube do Porto acquired 2,818,185 ordinary shares
of the Company, for €0.65 per share, from Somague Imobiliária, S.A. and Somague – Engenharia,
S.A., companies under Sacyr Vallehermoso, S.A., corresponding to 18.79% of the social capital and
voting rights of Sociedade Visada, becoming the main holder of the social capital of Futebol Clube
do Porto, SAD.
•
As 50% of the vote rights were overcome, and according to n. 187 of the Portuguese Securities
Market Code, Futebol Clube do Porto launched a public offer to acquire the full ordinary shares
issued by Futebol Clube do Porto – Futebol, SAD.
___________________________________________________________________________________________
24
2013/2014
___________________________________________________________________________________________
7. Future Perspectives
After an economic period with a net result above 20,000m€, FC Porto – Futebol, SAD presents a
negative result in the current period. This period is set by the strategic decision to not selling some of
the assets held by the Company, in order to compete at higher level in 2014/2015. We believe to be in
condition to do so.
The FC Porto DNA is to be national champion, and we will always fight for that trophy that keeps
landing in the FC Porto Museum (FC Porto won 9 of the 14 championships played in the XXI Century).
Apart from sporting glory, the access to the UEFA Champions League is extremely important for
acknowledgement and for the budget of the Company.
This season started with Julen Lopetegui taking the role of coach of the main squad, a man that is seen
as ideal to lead the team. Several young athletes were recruited, players with guaranteed value, quality
and considerable potential. These assets and the ambition of the coach are determinant for a steady
and long evolution of the squad, and to go as far as possible in every competition. The team was able
to win the qualification play-off for the UEFA Champions League, assuring the participation in the
biggest competition in European football, where FC Porto is usually seen, holding a record in
participations, along Barcelona, Real Madrid and Manchester United.
FC Porto insists on winning, but does it with a sense of responsibility, preserving values and anticipating
a surely auspicious future ahead.
___________________________________________________________________________________________
25
2013/2014
___________________________________________________________________________________________
8.
Information on own shares
FC Porto – Futebol, SAD holds 100 own shares, consolidated, worth 499€. These shares, although a
small representation of the social capital of the company, belong to PortoSeguro, a company of the
group held at 90% by FC Porto – Futebol, SAD.
PortoSeguro has acquired 100 shares at the moment the SAD was formed, in 1997, and never alienated
or acquired any more shares. Thus, in the beginning and the end of the financial year, FC Porto –
Futebol, SAD had 100 shares, worth 500€.
9. Statement of the Board of Directors
Under the terms of paragraph c) of point 1 of article 245 of the Securities Code, the directors of FC
Porto – Futebol, SAD, in charge of the company, state that, to their knowledge, the information
presented in this report, the annual accounts and other accounting documents required by law or
legislation, even if not approved by General Meeting, has been gathered in conformity with
international financial reporting standards adopted in the European Union, giving a true and accurate
image of assets and liabilities, of the financial situation and results of the issuer and of the companies
included in the Group, and that the management report faithfully lays out the evolution in business,
performance and position of the issuer and of the companies included in the Group, and contains a
description of the main risks and uncertainties the company has to face.
___________________________________________________________________________________________
26
2013/2014
___________________________________________________________________________________________
Porto, 9th of October 2014
Board of Directors
________________________________
Jorge Nuno Lima Pinto da Costa
________________________________
Adelino Sá e Melo Caldeira
________________________________
Fernando Manuel Santos Gomes
________________________________
Reinaldo da Costa Teles Pinheiro
________________________________
Rui Ferreira Vieira de Sá
___________________________________________________________________________________________
27
2013/2014
___________________________________________________________________________________________
B. Consolidated Financial Statements and Appendix
1. Statements of Consolidated Financial Position
ASSETS
Notes
30.06.2014
30.06.2013
NON-CURRENT ASSETS
Tangible assets
Intangible assets - Players' registrations
Other intangible assets
Other financial assets
Goodwill
Trade receivables
Other non-current assets
Total non current assets
7
8
7
9 and 22
6 and 10
11
13
1.197.406
61.505.641
1.764.128
720.999
3.139.715
11.243.921
24.691.949
104.263.759
1.561.106
76.158.898
1.748.553
2.246.568
238.045
24.766.753
15.253.094
121.973.017
CURRENT ASSETS
Inventories
Trade receivables
Other current assets
Cash and cash equivalents
Total current assets
12 and 22
11 and 22
13
14
1.596.982
64.498.529
15.071.223
14.965.439
96.132.173
1.112.554
64.129.401
22.819.817
17.817.786
105.879.558
200.395.932
227.852.575
16
75.000.000
(499)
259.675
169.075
652.307
(68.266.976)
(40.701.114)
(32.887.532)
75.000.000
(499)
259.675
132.753
188.262
(88.122.609)
20.355.997
7.813.579
17
(179.808)
(186.224)
(33.067.340)
7.627.355
18
18
19
20
21
23
22
19.112.500
19.395.933
1.006.255
12.762.622
448.818
410.555
53.136.683
13.225.000
29.526.645
7.669.894
3.745.563
10.206.032
1.924.649
66.297.783
18
18
19
20
21
71.040.781
29.591.657
10.027.940
35.846.536
33.819.675
180.326.589
43.004.014
9.617.134
61.677.137
39.629.152
153.927.437
TOTAL LIABILITIES
233.463.272
220.225.220
TOTAL EQUITY AND LIABILITIES
200.395.932
227.852.575
TOTAL ASSETS
EQUITY AND LIABILITIES
EQUITY
Share capital
Own shares
Share issue premiums
Legal reserve
Other reserves
Retained earnings
Consolidated net result for the year
Equity attributable to equity holders of the parent company
Non-controlling interests
TOTAL EQUITY
LIABILITIES
NON-CURRENT LIABILITIES
Bank loans
Bonds
Other creditors
Trade payables
Other non current liabilities
Pension liabilities
Provisions
Total non current liabilities
CURRENT LIABILITIES
Bank loans
Bonds
Other creditors
Trade payables
Other current liabilities
Total current liabilities
___________________________________________________________________________________________
28
2013/2014
___________________________________________________________________________________________
2. Consolidated Statements of Results by Category
Notes
Sales
Services rendered
Other income
Cost of goods sold
External supplies and services
Payroll expenses
Amortisation and depreciation excluding amortisation of players' registrations
Provisions and impairment losses excluding players' registrations
Other expenses
Operational profit/(loss) excluding results with players' registrations
Amortisation and impairment losses of players' registrations
Income/(expenses) related with transactions of players' registrations
30.06.2014
30.06.2013
3.720.078
66.978.193
1.914.559
(2.606.929)
(42.048.016)
(48.885.294)
(559.339)
86.273
(1.161.977)
(22.562.452)
2.785.715
74.550.782
1.104.858
(2.064.513)
(37.498.709)
(54.065.254)
(716.489)
733.305
(2.973.531)
(18.143.836)
(27.130.704)
23.906.857
(3.223.847)
(26.526.558)
76.445.209
49.918.651
(25.786.299)
31.774.815
(12.734.466)
2.564.942
(1.532.169)
(37.487.992)
(12.893.251)
3.771.307
(1.747.916)
20.904.955
(3.219.926)
(575.060)
(40.707.918)
20.329.895
17
(40.701.114)
(6.804)
20.355.997
(26.102)
32
(2,71)
1,36
(2,71)
(2,71)
1,36
1,36
24
28
12
25
26
7
22
27
27
Total operacional profit/(loss)
Financial expenses
Financial income
Gains and losses in investments
Profit/(loss) before income tax
Income tax
29
29
9, 10, 22 and 30
15
Consolidated profit/(loss) for the year
Attributable to:
Equity holders of the parent company
Earnings per share
Basic
Diluted
___________________________________________________________________________________________
29
2013/2014
___________________________________________________________________________________________
3. Consolidated Statements of Comprehensive Income
Notes
Net consolidated profit / (loss) for the year
Other comprehensive income for the year
Items that will not be reclassified to net income
Items that future will be reclassified to net income
Total consolidated comprehensive income for the year
Attributable to:
Equity holders of the parent company
17
30.06.2014
30.06.2013
(40.707.918)
20.329.895
-
-
-
-
(40.707.918)
20.329.895
(40.701.114)
(6.804)
20.355.997
(26.102)
___________________________________________________________________________________________
30
75.000.000
-
-
-
Balance as at 30 June 2014
-
75.000.000
Balance as at 1 July 2013
Appropriation of consolidated profit of 2012
Transfer to legal reserve
Transfer to other reserves
Transfer to retained earnings
Changes in reserves
-
-
75.000.000
-
75.000.000
Appropriation of consolidated profit of 2011:
Transfer to retained earnings
Dividends distribution
Share
capital
(499)
-
(499)
(499)
-
(499)
259.675
-
259.675
259.675
-
259.675
652.307 (52.824.085)
169.075
36.322
-
132.753
132.753
19.855.633
-
652.307 (68.266.976)
464.045
-
188.262 (88.122.609)
188.262 (88.122.609)
- (464.045) (35.298.524)
-
132.753
Total
7.813.579
7.813.579
(1)
20.355.997
(40.701.114) (32.887.532)
(36.322)
(464.045)
(19.855.633)
3
3
(40.701.114) (40.701.114)
20.355.997
20.355.997
35.762.568
20.355.997
(35.762.568) (12.542.417)
Attributable to equity holders of the parent company
Share
Acções
Own
issue
Legal
Other
Retained
Consolidated net
Próprias shares premiums reserve reserves
earnigs
result for the year
Total
7.627.355
7.627.355
(1)
(44.444)
20.329.895
(179.808) (33.067.340)
13.220
13.223
(6.804) (40.707.918)
(186.224)
(186.224)
(44.444)
(26.102)
(115.678) (12.658.095)
Non-controlling
interests
2013/2014
___________________________________________________________________________________________
4. Consolidated Statements of Changes in Equity Capital
___________________________________________________________________________________________
31
2013/2014
___________________________________________________________________________________________
5. Consolidated Statements of Cash flow
Notes
Operating activities:
Cash receipts from trade debtors
Cash payments to trade creditors
Cash payments to employees
Other cash receipts/(payments) relating to operating activities
Income taxes (paid)/received
Net cash flow from operating activities (1)
Investment activities:
Cash receipts arising from:
Tangible assets
Players' registrations
Interest and similar income
Cash payments arising from:
Players' registrations
Tangible assets
Net cash from/(used in) investment activities (2)
Financing activities:
Cash receipts arising from:
Loans obtained from investors (Note 19)
Loans obtained
Cash payments arising from:
Loans obtained from investors (Note 19)
Dividends
Loans obtained
Interest and similar charges
Net cash from/(used in) financing activities (3)
Cash and cash equivalents at the beginning of the financial year
14
Net increase/(decrease) of cash and cash equivalents: (1)+(2)+(3)
Cash and cash equivalents at the end of the financial year
14
30.06.2014
65.454.943
(47.834.299)
(50.468.736)
(4.022.410)
(4.566.891) (41.437.393)
(41.437.393)
23.700
71.246.628
620.168
71.890.496
(68.127.923)
(159.085) (68.287.008)
3.603.488
1.500.000
95.368.000
96.868.000
30.06.2013
74.264.191
(44.354.617)
(54.689.110)
(4.667.460)
(613.240)
49.000
122.183.176
1.073.518
(55.690.981)
(597.365)
131.993.634
(30.060.236)
(30.060.236)
123.305.694
(56.288.346)
67.017.348
131.993.634
(51.017.500)
(10.868.942) (61.886.442)
34.981.558
(8.750.000)
(44.444)
(133.132.585)
(11.122.488) (153.049.517)
(21.055.883)
17.817.786
(2.852.347)
14.965.439
1.916.557
15.901.229
17.817.786
___________________________________________________________________________________________
32
2013/2014
___________________________________________________________________________________________
6. Notes to Consolidated Financial Statements
1.
INTRODUCTION
Futebol Clube do Porto - Futebol, S.A.D. (‘FCPorto, SAD’ or ‘the Company’), with head office at
Estádio do Dragão, Via F.C. Porto, Entrada Poente, 3rd Floor, 4350-451 Porto, was incorporated
on 30 July 1997, and is the parent company of a group companies as presented in Note 5 as the
FCP Group (‘Group’). Its’ main activity considers the participation in professional football
competitions and the sporting events promotion and organization.
These consolidated financial statements are presented in euro, rounded to units, which is the
currency presented by the Company in its operations and therefore considered its functional
currency.
2.
SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies used in the preparation of the accompanying consolidated
financial statements are as follows:
2.1 BASIS OF PRESENTATION
The accompanying consolidated financial statements have been prepared on a going concern
basis from the books and accounting records of the companies included in the consolidation,
adjusted in the consolidation process to reflect International Financial Reporting Standards
effective for financial years beginning 1 July 2013, as adopted by the European Union. Such
standards include the International Financial Reporting Standards (‘IFRS’) issued by the
International Accounting Standards Board (‘IASB’), the International Accounting Standards (‘IAS’)
issued by the Accounting Standards Committee (‘IASC’) and the respective interpretations – SIC
and IFRIC issued by the International Financial Reporting Interpretation Committee (‘IFRIC’) and
Standing Interpretation Committee (‘SIC’), that have been adopted by the European Union. These
standards and interpretations are referred to hereinafter collectively as ’IAS/IFRS’.
The interim financial statements were prepared, quarterly, in accordance with IAS 34 – Interim
Financial Report.
During the year ended as of 30 June 2014, no changes occurred in relation to the accounting
policies presented in the consolidated financial statements as of 30 June 2013.
The following standards, interpretations, amendments and revisions adopted (“endorsed”) by the
European Union have become effective during the year ended as of 30 June 2014:
Standard/Interpretation
Effective date
IFRS 1 (Amendment) - First time
adoption of IFRS
01-Jan-2013
This amendment exempts entities adopting IFRS for
the first time the retrospective application of the
provisions of IAS 39 and paragraph 10A of IAS 20
relating to government loans.
___________________________________________________________________________________________
33
2013/2014
___________________________________________________________________________________________
IFRS 7 Disclosures
Instruments
(Amendment) of
Financial
01-Jan-2013
This amendment requires additional disclosures
regarding financial instruments, particularly,
information related with compensation of financial
assets and liabilities.
01-Jan-2013
The revision of this standard included the following
alterations:
(i) Actuarial gains and losses arising from
differences between the assumptions used
in determining liability and the expect
return plan assets and the effective
amounts, as well as those resulting from
change of actuarial and financial
assumptions during the year are to be
recognized immediately and only in "Other
comprehensive income”:
(ii) it shall be applied to a single interest
rate in determining the present value of
liabilities and the expected return on plans
assets;
(iii) The costs recorded in results
correspond only to the current services
and costs with net interests;
(iv) New disclosures are required;
IFRS 13 (New) – Fair value:
measurement
1-Jan-13
This standard establishes a single source of guidance
for fair value measurements and disclosures about
fair value measurement. IFRS 13 applies when
another IFRS requires or permits measurements or
disclosure of fair value.
IFRIC 20 – Discovery costs in the
production phase of an open cast
mine
1-Jan-13
This interpretation clarifies the recording of certain
costs during the production phase of a surface mine.
Improvements to International
Financial Reporting Standards
(cycle 2009-2011)
1-Jan-13
These standards involve the review of several
standards, including IFRS 1 (repeated application of
the standard), IAS 1 (comparative information), IAS
16 (classification of servicing equipment), IAS 32 (tax
effect of equity distributions) and IAS 34 (segment
information).
Amendment to IAS
Employees benefits
19
–
The adoption and application of these standards and interpretations did not produce material
changes in the financial statements of the Group as of 30 June 2014.
The following standards, interpretations, amendments and revisions, with mandatory application
in future years, were, until the approval date of the accompanying financial statements, endorsed
by the European Union:
___________________________________________________________________________________________
34
2013/2014
___________________________________________________________________________________________
Effective date
IFRS 10 – Consolidated 01-Jan-2014
Financial Statements
IFRS
11
–
Arrangements
Joint2014
IFRS 12 – Disclosure of
Interests in Other Entities
01-Jan-2014
IAS 27 - Separate Financial
Statements (2011)
1-Jan-14
This standard requires a parent to present consolidated
financial statements as a single economic entity, replacing
the requirements previously contained in IAS 27
Consolidated and Separate Financial Statements and SIC-12
Consolidation - Special Purpose Entities. The Standard also
introduces new rules with respect to the definition of control
and determination of the scope of consolidation.
This standard replaces IAS 31 - Joint Ventures and SIC 13 Jointly Controlled Entities – Non-Monetary contributions by
ventures and comes to eliminate the possibility of using the
proportionate consolidation method to account the interests
in joint ventures.
This standard has established a new set of disclosures related
to the interests in subsidiaries, joint arrangements,
associates and unconsolidated entities.
This amendment restricts the IAS 27’s scope to the
Separate Financial Statements.
IAS 28 – Investments in
Associates and Joint Ventures
(2011)
1-Jan-14
This amendment is to ensure consistency between IAS
28 - Investments in associates and new standards
adopted, in particular IFRS 11 - Joint Arrangements.
Amendment to the following
standards:
• IFRS 10 - Consolidated
Financial Statements;
• IFRS 12 - Disclosure of
Interests
in
other
entities
1-Jan-14
This amendment introduces an exemption from
consolidation for certain entities that meet the
definition of investment entity. It also determines rules
for measurement of investments held by these
investment entities.
IAS 32 – Amendments (Financial
assets and liabilities)
1-Jan-14
This amendment clarifies certain aspects of the
standard due to the diversity of requirements in
applying for compensation between financial assets and
liabilities.
IAS
36
(Amendment)
–
Impairment
(Recoverable
Amount Disclosures for NonFinancial Assets)
1-Jan-14
This
amendment
eliminates
the
disclosure
requirements of the recoverable amount of a cashgenerating unit like goodwill or intangible assets with
indefinite useful lives allocated to periods where it was
not recorded any impairment loss or reversal of
impairment.
Introduces
additional
disclosure
requirements for assets for which it was recorded an
impairment loss or reversal of impairment and the
recoverable amount of these has been determined
based on fair value less costs to sell.
___________________________________________________________________________________________
35
2013/2014
___________________________________________________________________________________________
IAS 39 (Amendment) – Financial
Instruments: Recognition and
Measurement
(Novation
of
Derivatives and Continuation of
Hedge Accounting)
1-Jan-14
This amendment allows, the continuation of hedge
accounting when a derivative designated as a hedging
instrument is overhauled.
The Group didn’t early adopt any of these standards to the Financial Statements of the year ended
30 June, 2014.
There aren’t expected any material impacts in the consolidated financial statements arising from
its adoption.
The following standards, interpretations, amendments and revisions with mandatory application
in future years, have not yet been endorsed by the European Union at the date of approval of
these financial statements:
IFRS 9 – Financial Instruments (2009)
and subsequent amendments
T
TThis standard is inserted in the IAS 39 revision project and
eestablishes the requirements for classifying and measuring
fifinancial assets.
Amendments to the standards:
• IFRS
9
–
Financial
instruments (2013);
• IFRS
7
–
Financial
instruments - Disclosures
TThe amendment to IFRS 9 is inserted in the IAS 39 revision pproject
and establishes the requirements to the application of the hhedging
accounting rules. IFRS 7 was also revised following this
aamendment.
Amendment to IAS 19 – Employees
benefits
TThis amendment clarifies in what circumstances the employees’
ccontributions to retirement benefit plans constitute a reduction of
t the cost with short-term benefits.
Improvements
to
International
Financial Reporting Standards (cycle
2010-2012)
TThese improvements involve the revision of several standards.
Improvements
to
International
Financial Reporting Standards (cycle
2011-2013)
TThese improvements involve the revision of several standards.
IFRIC 21 – Levies
This amendment establishes the conditions of the timing of
recognition of a liability related with a levy imposed by a
government in result of determined event (for example the
participation in certain market) in cases that payment has, as
counterpart goods or services.
___________________________________________________________________________________________
36
2013/2014
___________________________________________________________________________________________
Amendment to IAS 16 - "Tangible
Fixed Assets" and IAS 38 - "Intangible
Assets"
Amendment to IFRS 11 - "Joint
Arrangements"
IFRS 14accounts”
“Regulatory
deferral
IFRS 15- “Revenue from contracts with
customers”
This amendment clarifies the methods accepted for depreciation
and amortization of tangible and intangible assets.
This amendment clarifies the accounting for acquisitions of
interests in joint arrangements.
The purpose of this standard is to specify the disclosure
requirements applicable to balances arising from the supply of
goods or services to customers at prices or rates that are subject
to regulation.
The purpose of this standard is to specify disclosure requirements
for related with revenue recognition.
These standards have not yet been approved (“endorsed”) by the European Union and, as such,
were not adopted by the Group for the year ended June 30, 2014.
2.2 BASIS OF CONSOLIDATION
The consolidation methods adopted by the Group in the preparation of the consolidated financial
statements are as follows:
a) Investments in Group companies
Investments in companies in which the Group owns, directly or indirectly, more than 50% of
the voting rights at Shareholders’ General Meetings or is able to establish financial and
operational policies (definition of control used by the Group), are included in the consolidated
financial statements using the full consolidation method. Equity and net profit attributable to
minority shareholders are shown separately, under the caption ‘Non-controlling interests’, in
the consolidated statement of financial position and in the consolidated income statement.
Companies included in the consolidated financial statements using the full consolidation
method are listed in Note 5.
Adjustments to the financial statements of Group companies are performed, whenever
necessary and considered relevant, in order to adapt accounting policies to those used by the
Group. Intra-group balances and transactions are eliminated on consolidation process.
b) Goodwill
Differences between the cost of acquisition of investments in Group companies and the fair
value of the identifiable assets and liabilities of those companies at the date of acquisition,
when positive, are shown as Goodwill (Note 10).
___________________________________________________________________________________________
37
2013/2014
___________________________________________________________________________________________
Goodwill is not amortised, being subject to impairment tests on an annual basis. Net
recoverable amount is determined based on business plans performed by the Group
management or on valuation reports issued by independent entities. Impairment losses
recognized in the period are recorded in the income statement under the caption ‘Provisions
and impairment losses, excluding players’ registrations. Impairment losses related with
goodwill may not be reversed.
2.3 MAIN ACCOUNTING POLICIES
The main accounting policies used in the preparation of the consolidated financial statements are
as follows:
a) Tangible assets
Tangible assets acquired up to 1 July 2004 (transition date to IFRS) are recorded at deemed
cost, which corresponds to the acquisition cost net of accumulated depreciation and
impairment losses recorded up to that date.
Tangible assets acquired after that date are recorded at acquisition cost net of accumulated
depreciation and impairment losses.
Depreciation is calculated on a straight line basis, as from the date the assets are first used,
over the expected useful life for each group of assets. The expected useful life of the main
groups of assets is as follows:
Buildings and other constructions - 8 to 20 years
Machinery and equipment - 4 to 10 years
Transport Equipment - 3 to 8 years
Office equipment - 3 to 8 years
Other tangible assets - 1 to 10 years
Maintenance and repair costs relating to tangible assets which do not increase their useful life
nor result in significant benefits or improvements are recorded directly as expenses in the
period they are incurred.
Gains or losses arising on sale or disposal of tangible assets are calculated as the difference
between the selling price and the carrying amount of the asset at the date of its sale/disposal;
these are recorded in the income statement under either ‘Other income’ or ‘Other expenses’.
b) Intangible assets - Players’ registrations
The caption ‘Intangible assets - Players’ registrations’ includes costs related with the
acquisition of players’ registrations, including intermediation service costs, as well as signingon fees paid directly to the players, in accordance with the Decree-Law 103/97 of 13
September.
When the percentage owned of players’ registrations is less than 100% (see Note 8), it means
that although the Company is entitled to full use of the player’s registration, it has entered into
___________________________________________________________________________________________
38
2013/2014
___________________________________________________________________________________________
an associated financial interests contract with a third party, which consists of an investment
partnership in the registration rights, resulting in the proportional sharing of the inherent
results in future the transaction of these rights.
If is estimated a loss on the recoverable amount of a player’s registration (‘impairment loss’),
the corresponding impact is recognized in the income statement under the caption
‘Amortization and impairment losses of players' registrations’. The recognition and
quantification of such impairment losses consider the carrying amount of players’
registrations, as of 30 June 2014, of players whose labour contracts have been terminated up
to the approval date of the consolidated financial statements.
Costs associated with securing the extension of a player’s labour contract are also recorded
under the caption ‘Intangible assets - Players’ registrations’, being determined a new book
value for the player’s registration which is amortized over the remaining revised contract term.
Costs included in the caption ‘Intangible assets - Players’ registrations’ are amortized over the
period covered by contracts celebrated between the players and the Company, in accordance
with Decree-Law 103/97 of 13 September.
“Players on loan”
The acquisition costs of players’ registrations that are on temporary loan to other clubs are
maintained in the caption ‘Intangible assets - Players’ registrations’ and continue to be
amortized over the number of years these rights expire, according to the player’s labour
contract, as it’s considered to exist a potential valorization of the player registration while the
player plays by other club under the referred loan. If a loss is estimated on the recoverable
amount (‘impairment loss’) of the players’ registrations on loan up to the end of the contract
period, namely when the player is borrowed in its last year of contract, the corresponding
effect is recorded in the income statement under the caption ‘Amortization and impairment
losses of players' registrations’.
c) Other intangible assets
Other intangible assets (non-players’ registration) are stated at acquisition cost net of
depreciation and accumulated impairment losses. Intangible assets are only recognized if it is
probable that future economic benefits will flow from them to the Group, if they are controlled
by the Group and if their value can be reliably measured.
Depreciation is charged, on a straight-line basis over the estimated useful life of the assets as
from the date the assets are available for use (Note 7).
d) Leasing and long term rental
Tangible assets acquired under finance lease contracts and the corresponding liabilities are
recorded in accordance with the financial method, when complying with the requirements of
IAS 17 - ‘Leases’. Accordingly, tangible assets are recorded as assets and corresponding
obligations as liabilities in the statement of financial position. Both the finance charge and the
depreciation expense for depreciable assets, calculated as explained in Note 2.3.a), are taken
to the income statement in the period in which they are incurred.
___________________________________________________________________________________________
39
2013/2014
___________________________________________________________________________________________
Long term rental instalments on assets acquired under this regime are recognised in full as
expenses in the period to which they refer.
Determination of whether contracts relate to finance leases or long term rentals is made based
upon the substance rather than the form of the contracts.
Operating lease instalments are recognized as expenses on a straight-line basis over the rental
period.
e) Impairment of non-current assets, except for Goodwill
Assets are assessed for impairment whenever events or changes in circumstances indicate that
the carrying amount of an asset may not be recoverable.
Whenever the book value of an asset exceeds its recoverable amount, an impairment loss is
recognised in the profit and loss statement caption ‘Provisions and impairment losses
excluding players’ registrations’.
The recoverable amount is the higher of an asset’s fair value less costs to sell and its value in
use. Fair value less costs to sell is the amount obtainable from the sale of an asset in an arm’s
length transaction between knowledgeable parties, less costs of disposal. Value in use is the
present value of estimated future cash-flow from the continued use of an asset and from its
disposal at the end of its useful life. Recoverable amounts are estimated for each asset
individually.
Impairment losses recognised in prior years are reversed when it is concluded that the
impairment losses previously recognised no longer exist or have decreased. This assessment
is made whenever there is an indication that impairment losses previously recognised have
been reversed. The reversal is recorded in the income statement caption ‘Other income’.
However, reversal of the impairment loss is recognised only up to the amount at which the
asset would have been recorded (net of depreciation) had no impairment loss been recognised
for that asset in prior years.
f) Borrowing costs
Borrowing costs are recognised on an accruals basis in the income statement for the period in
which they are incurred.
g) Inventories
Inventories are stated at acquisition cost or net realizable value, whichever is lower, using the
average cost as costing method.
Differences between cost and net realizable value, if negative, are shown as operating
expenses under the caption ‘Cost of sales’.
___________________________________________________________________________________________
40
2013/2014
___________________________________________________________________________________________
h) Provisions
Provisions are recognised when, and only when, the Group has a present obligation (legal or
constructive) as result of a past event, it is probable that a outflow of resources will be required
to settle the obligation, and a reliable estimate can be made of that obligation. Provisions are
reviewed and adjusted at the end of the reporting period to reflect the best estimate as of that
date.
i) Financial instruments
i)
Investments
Investments are classified into the following categories:
- Held to maturity
- Investments measured at fair value through profit or loss
- Available-for-sale
Held to maturity investments are classified as non-current assets unless they mature
within 12 months of the end of the reporting period. Investments classified as held to
maturity have defined maturities and the Group has the intention and ability to hold them
until the maturity date.
The investments measured at the fair value through profit or loss include the investments
held for trading that the Group acquires with the purpose of trading in the short term.
They are classified in the consolidated statement of financial position as current
investments.
The Company classifies as available-for-sale investments those that are neither included
as investments measured at fair value through profit or loss neither as investments held
to maturity. These assets are classified as non-current assets, except if the sale is expected
to occur within 12 months from the date of classification.
All purchases and sales of investments are recognised on the trade date, independently
of the settlement date.
Investments are initially measured at cost, which is the fair value of the consideration paid
for them, including transaction costs.
Investments that do not have a quoted price and whose fair value cannot be reliably
measured are stated at cost less any impairment losses.
ii)
Trade receivables and Other receivables
Non-current accounts receivables are measured at amortised cost using the effective
interest method, less any impairment.
Current account receivables are presented in the statement of financial position, net of
any impairment losses, and are recorded at their nominal value, except when the effect
___________________________________________________________________________________________
41
2013/2014
___________________________________________________________________________________________
of discounting is material, when they are recorded at amortised cost using the effective
interest method.
Financial income is calculated in accordance with the effective interest rate, except for
very short term receivables when the income amounts to recognize would be immaterial.
Accounts receivables are recorded as current assets, except when its maturity is greater
than 12 months from the end of the reporting period, when they are classified as noncurrent assets. These financial assets are included in the captions presented in Note 11.
Impairment is recognized if there is objective and measurable evidence that, as a result
of one or more events that occurred, the balance will not be fully received. Therefore,
each group company takes into consideration information that indicates:
- significant financial difficulty of the counterparty;
- default or delinquency in payments;
- it becoming probable that the counterparty will enter bankruptcy or financial reorganization.
iii) Financial liabilities and equity instruments
Financial liabilities and equity instruments are classified and recorded based upon their
contractual substance. Equity instruments are contracts that evidence a residual interest
in the assets of the Group after deducting all of its liabilities, and are recorded at the
proceeds received, net of direct issue costs.
iv) Loans
Loans are recorded as liabilities at their nominal value net of transaction costs directly
related to the issuance of those instruments. Financial expenses are calculated based on
the effective interest rate and are recorded in the income statement on an accruals basis.
v)
Trade payables and Other payables
Accounts payables are recorded at amortized cost using the effective interest rate
method.
Current accounts payable are stated at their nominal value, unless the effect of
discounting is considered material, when they are recorded using the effective interest
rate method.
The financing costs are calculated according to the effective interest rate, except for
amounts payable to very short-term securities which would be to recognize immaterial.
Accounts payable are classified as current liabilities, except in cases where the maturity is
longer than 12 months of the end of the reporting period, which are classified as noncurrent. These liabilities are included in the classes identified in Note 20.
___________________________________________________________________________________________
42
2013/2014
___________________________________________________________________________________________
vi) Discounted bills
Trade receivables represented by discounted bills that have not yet matured at the end
of the reporting period remain recorded in the statement of financial position until they
are collected.
vii) Cash and Cash Equivalents
‘Cash and cash equivalents’ include cash on hand, cash at banks, term deposits and other
treasury applications which mature in less than three months and are subject to
insignificant risk of change in value.
In the consolidated statement of cash-flows, ‘Cash and cash equivalents’ also include bank
overdrafts, which are included in the statement of financial position caption ‘Bank loans’.
viii) Other financial assets – Players economic rights
The amounts includes in the caption “Other financial assets – Players economic rights”
are related to the economic rights over several players whose sporting rights were sold
by FCPorto SAD, while keeping part of their economic rights. These assets are registered
at cost, less possible impairment losses.
ix) Effective interest rate method
Effective interest rate method is a method of calculating the amortized cost of a financial
asset or liability and of allocating interest income or expense over the relevant period.
The effective interest rate method is the one used to calculate the amortization cost of a
financial asset or liability and to realize the income or cost allocation up to maturity of the
financial instrument. The effective interest rate is the one that, being used to discount
estimated future cash flows associated to the financial instrument, allows to meet its
actual value to the financial instrument value on the initial recognition date.
x)
Impairment of financial instruments
Financial assets are analysed at each consolidated financial statement date to verify the
existence of impairment losses indicators.
The financial assets are considered in situation of impairment when there is objective
evidence that, as a consequence of one or more events occurred after the assets initial
recognition the estimated cash flows had been negatively affected.
For the financial assets measured at amortized cost, the impairment is calculated by the
difference between the asset's carrying amount and the present value of estimated future
cash flows, discounted at the financial asset's original effective interest rate.
For investments on subsidiaries, measured at acquisition cost less impairment, the
impairment analysis evolves the use of discounted cash flows models to estimate the
value in use of the referred investments. Such models imply that the Company estimated
___________________________________________________________________________________________
43
2013/2014
___________________________________________________________________________________________
the present value of future cash flows of the subsidiary company according to a discount
rate in line with its associated risk.
It is the Board of Directors understanding that the use of the above mentioned
methodology is adequate to conclude on the eventual existence of financial investments
impairment as it incorporates the best available information as at the date of the financial
statements
j)
Contingent assets and liabilities
Contingent assets are possible assets arising from past events and whose existence will be
confirmed only by the occurrence or non-occurrence of one or more uncertain future events
not within the full control of the Group.
Contingent assets are not recorded in the consolidated financial statements but disclosed
when future economic benefits are probable.
Contingent liabilities are defined by the Group as (i) possible liabilities arising from past events,
the existence of which will only be confirmed by the occurrence, or not, of one or more
uncertain future events not under full control of the Group, or (ii) present obligations arising
from past events, but which are not recognised because it is unlikely that there will be an
outflow of financial benefits to settle the obligation or the amount of the obligation cannot be
reliably measured.
Contingent liabilities are not recorded in the consolidated financial statements. Instead they
are disclosed in the notes to the financial statements, unless the probability of a cash outflow
is remote, in which case, no disclosure is made.
k) Income tax
The below mentioned group of companies, which is dominated by Futebol Clube do Porto –
Futebol, S.A.D., has been taxed in accordance with the special regime for taxation of company
groups (‘Regime Especial de Tributação de Grupo de Sociedades’ – ‘RETGS’).
The companies included in the tax group, the June 30, 2014, taxed according to RETGS are as
follows:
Futebol Clube do Porto – Futebol, S.A.D.
PortoComercial – Sociedade de Comercialização, Licenciamento e Sponsorização, S.A.
PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, S.A.
PortoSeguro - Sociedade Mediadora de Seguros do Porto, Lda.
Dragon Tour – Agência de Viagens, S.A.
Income tax for the year is determined based on the taxable results of the companies included
in the consolidation and takes into consideration deferred taxation.
According to existing Portuguese legislation, company’s tax returns included in the
consolidation are subject to revision and correction by the Tax Administration during a period
of four years (five years for Social Security), unless there were tax losses, have been granted
___________________________________________________________________________________________
44
2013/2014
___________________________________________________________________________________________
tax benefits, or there are ongoing inspections, complaints or disputes, these cases where,
depending on the circumstances, the deadlines are elongated or suspended. Besides the
referred in Note 22 and 35 relatively to inspections, complaints and ongoing impeachments,
the tax situation on the years ended on 30 June 2011 and 30 June 2014 may still be subject to
review and possible corrections.
The Board of Directors of the Parent-Company and its subsidiaries believe that any
adjustments resulting from review by the Tax Administration and the tax situation for taxbusinesses, for the years in open, should not have a significant effect on the consolidated
financial statements.
Under Article 88 of the Tax Code the corporate income businesses of the Group, are subject to
additional taxation on a separate set of charges at the rates provided for in the mentioned
article.
Deferred taxes are calculated using the balance sheet liability method and reflect the
temporary differences between the amount of assets and liabilities for accounting purposes
and the corresponding amounts for tax purposes. Deferred taxes are calculated and annually
evaluated using the tax rates expected to be in force or announced at the time the temporary
differences are reversed.
Deferred tax assets are only recorded when there is reasonable expectation that sufficient
taxable profits will arise in the future to allow such deferred tax assets to be used or when
there are temporary taxable differences that compensate temporary tax deductible
differences in the period they reverse. At the end of each period the Group reviews the
deferred tax assets and reduces them whenever their realisation ceases to be likely.
l) Revenue and Accruals
Revenue is recorded at fair value of assets received or receivable, net of discounts.
i)
Sales of goods
Revenue from the sales of goods (merchandising products) is recognised in the income
statement when: (i) the significant risks and benefits of ownership of the assets have been
transferred to the buyer, (ii) the Group does not retain continued management
involvement of the asset sold to a degree usually associated with ownership or effective
control over it, (iii) the amount of revenue can be reliably measured, (iv) it is likely that
the economic benefits associated with the transaction will flow to the Group, and (v) the
costs incurred or to be incurred with the transaction can be reliably measured. Sales are
recognised net of taxes, discounts and other costs, including commissions, at the fair value
of the amount received or receivable.
ii)
Sale of players’ registrations
Gains or losses on disposal of players’ registrations are recorded in the income statement
under the caption ‘Income/(expenses) related with transactions of players' registrations’
and are calculated as the difference between the selling price and the carrying amount of
the player’s registration at the date of the sale and any other costs related directly with
___________________________________________________________________________________________
45
2013/2014
___________________________________________________________________________________________
the sale, including intermediation service costs and costs with liabilities relating to the
‘solidarity mechanism’ (that corresponds to a compensation at the time of the transfer of
a player to another club, before the term of the respective sporting contract in is actual
club, to its former clubs that the players where registered since their 12th and their 23rd
birthday – this amount corresponds to 5% of the transfer value, to distribute
proportionally among them, 0.25% from 12th to 15th anniversary and 0.5% from 16th to
23rd anniversary). Whenever relevant, the effect of discounting future receipts to its
present value is considered in the determination of the transaction result. Gains or losses
on sale of players’ registrations are recognized in the income statement when the
significant risks and benefits of the player’s registration have been transferred.
iii)
Contracts of association of economic interests
The gains arising from the celebration of contracts of association of economic interests,
which consists of an investment partnership, as mentioned in paragraph b), are recorded
in the income statement or in statement of financial position (liabilities), depending if the
significant benefits and risks arising from those transactions have been, or not, effectively
and materially transferred, according to the contractually defined.
iv)
Bonuses for participation in European Competitions
Fixed bonuses for obtaining the right to participate in the UEFA Champions League are
recognised in the period in which participation is guaranteed, which is independent of the
performance in that competition. The related costs, namely the players’ and technical
staff’s bonuses are equally recorded in the period in which participation is guaranteed.
Variable bonuses depending on sporting performance are recorded in the period the
matches are played.
v)
Other income
Income relating to broadcasting rights, advertising and sponsorships is recorded in the
income statement in accordance with the duration period of the respective contracts.
Income relating to football matches is recognised in the period the matches are played.
Interest and financial income are recognised on an accruals basis at the applicable effective
interest rates.
Other income and expenses are recorded in the period to which they relate, regardless of their
date of payment or receipt. Differences between the amounts received or paid and the
corresponding income and expenses are recognised in captions ‘Other non-current assets’,
‘Other current assets’, ‘Other current liabilities’ and ‘Other non-current liabilities’.
m) Post-Employment benefits
The Group has committed to grant to certain employees cash benefits as pension
complements for retirement, which configure a defined benefit plan.
___________________________________________________________________________________________
46
2013/2014
___________________________________________________________________________________________
In order to estimate its liability for payment of these benefits, actuarial liabilities were
calculated in accordance with the “Projected Unit Credit Method”. Actuarial gains and losses
are recorded in the statement of other comprehensive income in the year they occur, as
defined in IAS 19. Pension liabilities are recognized on the balance sheet date under the
caption "Pension liabilities" and represent the present value of obligations for defined benefit
plans, adjusted for actuarial gains and / or liabilities for past services not recognized.
n) Foreign currency balances and transactions
All foreign currency assets and liabilities are translated to Euro at the official year-end
exchange rates. Exchange gains and losses resulting from differences between the exchange
rates in force on the date of the transactions and those in force on the date of collections,
payment or the end of the reporting period are recognised as gain or loss in the income
statement of the period.
o) Subsequent events
Events after the end of the reporting period that provide additional information on
conditions existing at the end of the reporting period (adjusting events), are reflected in the
consolidated financial statements. Events after the end of the reporting period that provide
information about conditions arising after the end of the reporting period (non-adjusting
events), when material, are disclosed in the notes to the financial statements (Note 36).
p) Judgements and estimates
In the preparation of the accompanying consolidated financial statements judgments and
estimates were made and several assumptions were used that affected the value of the assets
and liabilities presented, as well as the presented amounts of revenues and expenses for the
period.
Estimates used and underlying assumptions were determined based on the best information
available of the ongoing events and transactions, at the approval date of these financial
statements, as well as based on best knowledge of past and present events. However, not
foreseeable situations may occur in subsequent periods, which were not considered in these
estimates. Changes to these estimates that occur in subsequent periods will be prospectively
corrected. For this reason and considering the uncertainty level incorporated, actual results of
these transactions may differ of the corresponding estimates.
The most significant accounting estimates reflected in the consolidated income statements
include:
(i)
(ii)
(iii)
Useful lives of tangible and intangible assets;
Impairment analysis of Goodwill, of financial assets (namely, players’ economic
rights), of the intangible assets – players’ registrations (Note 2.3.b)), and of other
tangible and intangible assets;
Recognition of adjustments on assets and provisions.
___________________________________________________________________________________________
47
2013/2014
___________________________________________________________________________________________
q) Segment information
Every year, the Group’s most adequate applicable segments are identified considering the
developed activities.
Information regarding income by business segment is included in Note 33.
3.
FINANCIAL RISK MANAGEMENT
In addition to the risks inherent to the results of the sports’ activity and its’ impacts on the
economic results and on the assets appreciation, the Group’s activity is also exposed to a variety
of financial risks, such as market risk, credit risk and liquidity risk. These risks are the result of the
uncertainty inherent to the financial markets, which is reflected in the capacity to estimate future
cash-flows and returns. The Group’s risk management policy seeks to minimize any adverse
effects arising from these uncertainties characteristic of financial markets.
3.1.
Market risk
a) Interest rate risk
The interest rate risk is primarily result of loans indexed to variable interest rates.
The Group's debt is mainly indexed to variable and fixed interest rates, exposing the cost
of debt to a risk of volatility. The impact of such volatility in the profits and equity of the
Group is significant given the high level of indebtedness of the Group.
Although the interest rate risk is significant, the Group does not, usually, use interest rate
derivatives for hedging this risk.
As of 30 June 2014 and 2013, the Group presents a debt of approximately 149,169
thousand Euro and 103,043 thousand Euro, respectively, divided between current and
non-current loans (Notes 18 and 19) contracted with various financial institutions.
Interest rate sensitivity analysis
The sensitivity analysis presented below was computed on the basis of the Group's
exposition to changes in interest rate on financial instruments with reference to the
estimate of average indebtedness in the season 2013/2014. For financial instruments, the
analysis was prepared on the understanding that changes in market interest rates affect
interest income or expenses of financial instruments indexed to variable interest rates.
The mentioned analysis pointed out that if the Euribor had been 50 basis points higher and
all other variables held constant, the financial charges for the year ended 30 June 2014
would increase by, approximately 327,000 Euro (207,000 Euro in the financial year ended
30 June 2013).
___________________________________________________________________________________________
48
2013/2014
___________________________________________________________________________________________
b) Exchange rate risk
Developing its activity, the Group carries out some transactions denominated in currencies
other than Euro, namely transactions of players’ registrations. However, such transactions
in foreign currency have been insignificant, being the vast majority contracted in Euro, and
residually in U.S. dollars. Thus, the Group does not use derivatives for hedging, namely
exchange rates forwards.
3.2.
Credit risk
The Group's exposure to credit risk is mainly related with accounts receivable arising from the
sale of players’ registrations and other transactions related with the Group’s activity, namely the
sale of broadcasting rights, advertising and various sponsorships. The credit risk refers to the
risk of the counterparty defaulting on its payment contractual obligations, resulting in a financial
loss to the Group.
The objective of this risk management is to ensure the effective credit collections on established
deadlines without affecting the Group’s financial stability. The evaluation of this risk is made on
a regular basis, and the management’s goal is (a) to evaluate the counterparty in order to assess
its ability to pay the debt, (b) to monitor the evolution of the amount of trade receivables, and
(c) to perform an impairment analysis of accounts receivables on a regular basis.
The Group does not consider there is significant credit risk with any entity in particular, or with
a group of entities with similar characteristics, to the extent that accounts receivables are spread
across various customers and different geographical areas. The Group asks for credit
guarantees, when the financial position of the client recommends so. For customers with higher
credit risk, or when the account receivable is greater than normal, these guarantees should be
bank guarantees.
Impairment losses related to accounts receivables are calculated taking into consideration: (a)
the client’s risk profile, (b) the term of collection of each contract, which differs in each line of
business, and (c) the customer’s financial conditions. Changes in accumulated impairment losses
for the years ended 30 June 2014 and 2013 are disclosed in Note 22.
As of 30 June 2014 and 2013, the Group considers that there is no need to book additional
impairment losses besides the amounts recorded on those dates and summary disclosed in Note
22.
3.3.
Liquidity risk
Liquidity risk is defined as the risk of lack of ability to settle or accomplish its obligations on
stipulated time and reasonable price. The existence of liquidity implies that management
parameters are set which maximize the return and minimize the opportunity costs associated
with the liquidity in a safe and efficient manner.
This risk management in the Group aims to:
___________________________________________________________________________________________
49
2013/2014
___________________________________________________________________________________________
-
Liquidity - ensure the permanent and efficient access to funds to meet correct payments
to the respective due dates;
Security - minimize the probability of default in the refund of any application of funds; and
Financial efficiency -minimise the cost of opportunity of excessive short term liquidity.
The Group aims to make compatible the due dates of assets and liabilities through an active
management of its maturities. Normally, each contract loan is guaranteed by a receivable
account balance (due to player’s registration sale, or due to receivables amounts related to
European competitions bonuses and broadcasting rights); additionally, usually, the maturity
dates of such loans match the due dates of the accounts receivables.
The information considered in the notes to the consolidated financial statements, regarding the
maturity analysis of financial liabilities includes the due amounts, not discounted, and based
upon the worst case scenario, which is, the shortest period in which the liability becomes due,
assuming the compliance of all requirements set contractually.
Regarding the liquidity risk, as of 30 June 2014, despite the consolidated financial statements
show a negative equity attributable to equity holders of the parent company of 33 million Euro
and a negative working capital in approximately 84 million Euro (48 million Euro as of 30 June of
2013), it is conviction of the Board of Directors that based (i) on loans obtained, or in the process
of be obtained, of approximately 48 million Euro, (ii) on the renegotiation of maturities of
existing loans in the amount of 47 million Euro (Note 36), as well as (iii) the predictions of the
eventual financial reinforcement resulting from the sale of players registration sporting rights,
as it has been usual in prior years, this risk is properly mitigated.
3.4.
Regulatory risk - “ Financial Fair Play “
FCP, SAD is subjected to the licensing system for admission of football clubs in participating on
UEFA organized competitions: "UEFA Club Licensing and Financial Fair Play Regulations".
This regulation governs the rights, duties and responsibilities of all parties involved in the club
licensing system for participation in the UEFA competitions and sets in particular the sport’s
related to infrastructures, administrative and staff-related, legal and financial minimum criteria
to be met by a sports company in order to obtain a license to participate in UEFA club
competitions as part of the admission process to the competition.
According to this system FCP SAD, will have to meet a set of requirements, among which the
following stands out:
1. Inexistence of overdue and unpaid debts (i) with football clubs regarding the players’
registrations transfers and (ii) towards employees and/or tax authorities and social security;
2. Verification of the equilibrium ("breakeven") between the relevant revenues and relevant
costs, which the acceptable deviation accumulated raises to a 5 million Euro for a monitoring
period equivalent to the sum of three exercises (the three previous seasons, except the first year
of application of this criteria (season 2013/2014) in which it was considered only two seasons).
However, this deviation may be exceeded if such excesses are fully covered by equity
contributions from shareholders or and / or related parties:
___________________________________________________________________________________________
50
2013/2014
___________________________________________________________________________________________
• Seasons of 2013/14 and 2014/15: 45 million Euro;
• Seasons of 2015/16, 2016/17 and 2017/18: 30 million Euro
The sanctions for non-compliance with these rules may include (i) warnings, (ii) fines, (iii)
retention of premiums paid and, ultimately, (iv) the prohibition to participate in UEFA’s
organized competitions.
The FCP-SAD has been monitoring his situation regarding the new Financial Fair Play criteria and
is currently complying with these requirements.
3.5.
Sportive risk
The main activity of FCP, SAD is the participation in national and international professional
football competitions. Therefore, the Company depends on the existence of these sportive
competitions, the maintenance of their participation’s rights, the maintenance of the premiums
paid under these competitions and the sportive performance achieved by its professional
football team, particularly the possibility of qualifying for the European competitions mainly the
UEFA Champions League. By its turn, sports performance may be affected by the sale or
purchase of players’ registrations considered essential for the sportive performance of FCP, SAD.
As predicted in the sports companies’ activity, FCP, SAD regularly sells regularly its players’
registrations. In the acquisition of each players’ registrations, there is no guarantee that the
value of a potential sale corresponds to their fair value or even that there will be interested
buyers in acquiring the players’ registrations of a certain player. As usual in its activity, FCP, SAD
has players’ registrations that may be sold at any time, and, in case of sale of those players’
registrations, it may not be possible to find players that replace the players that were sold,
providing at least the same level of performance.
Significant part of the operating income of FCP, SAD arises from the sale of football matches’
broadcasting rights of advertising contracts. These revenues are dependent on the media and
sports projection of their main football team as well as the negotiating power of FCP, SAD
towards the entities to which these exploitation rights are transferred of those activities. In
addition, FCP, SAD is dependent on the ability of counterparties to such contracts comply with
the agreed payments and, ultimately, to be possible to find other competitors in the market of
those entities.
Costs related with the set of FCP, SAD football players, assume a determining weight in its
operating results. The profitability and the economic and financial balance of the Company are,
therefore, significantly dependent on the ability of the FCP, SAD Management to ensure a
moderate increase in average costs per player and the rationalization of the number of players,
specially taking into account the criteria of Financial Fair Play defined in Section 3.4.
4.
CHANGES IN ACCOUNTING POLICIES, ESTIMATES AND ERRORS
During the year there were no changes in accounting policies, nor changes in estimates and
material errors related with prior periods.
___________________________________________________________________________________________
51
2013/2014
___________________________________________________________________________________________
5.
COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENTS
The companies included in the consolidation by the full consolidation method (Note 2.2.a), their
head offices, the percentage of share capital held by the Group and activity as of 30 June 2014
and 2013 are as follows:
Head
Office
Activity
%
participation
held
30.06.2014
%
participatio
n held
30.06.2013
Futebol Clube do Porto –
Futebol, S.A.D.
Porto
Participation in professional football
competitions and the sporting events
promotion and organization.
Parent
company
Parent
compan
y
PortoComercial – Sociedade
de
Comercialização,
Licenciamento
e
Sponsorização,
S.A.
(“PortoComercial”)
Porto
Image
rights
commercialization,
sponsoring, merchandising and products
licensing.
93.5%
93.5%
F.C.PortoMultimédia
Edições Multimédia,
(“PortoMultimédia”)
S.A.
Porto
Editing,
production
and
commercialization
of
multimedia
material and to the Internet, periodical
and non-periodical publications.
70%
70%
PortoEstádio – Gestão e
Exploração de Equipamentos
Desportivos,
S.A.
(“PortoEstádio”)
Porto
Sport equipment
exploration.
100%
100%
PortoSeguro - Sociedade
Mediadora de Seguros do
Porto, Lda. (“PortoSeguro”)
Porto
Insurance brokerage.
90%
90%
Dragon Tour, Agência de
Viagens, S.A. (“DragonTour”)
Porto
Organization and sale of travel and tour
packages; ticket and seat reservation;
representation of other travel agencies
and tourism.
93.5%
93.5%
Fc Porto- Media, S.A(a)
Porto
98.78%
1%
Company
management
and
Concept,
design,
development,
production,
direction,
promotion,
marketing, acquisition, exploration rights,
recording, distribution and dissemination
of works and audiovisual programs,
multimedia, television, video, cinema,
theme, internet channels, tourist events,
cultural and sporting in any formats and
systems; managing, operating and
providing services in the areas of
recording,
production
and
communication of audiovisual works,
television shows, sounds, images, and any
other audiovisual media; issue periodic
publicities, books and multimedia.
___________________________________________________________________________________________
52
2013/2014
___________________________________________________________________________________________
(a)
Entity that was included in the consolidation perimeter as of July 31, 2013, and which activity during the
years ended as of June 30, 2014 and 2013 was reduced, not affecting the comparability of financial
statements of this year compared with the previous year.
6.
CHANGES TO THE CONSOLIDATION PERIMITER
The detail of the caption "Goodwill" as of June 30, 2014 and 2013 is as follows:
PortoSeguro
FC Porto - Media, S.A.
30.06.2014 30.06.2013
238,045
238,045
2,901,670
3,139,715
238,045
During the year ended June 30, 2014, FC Porto Media Company, SA was included in the
consolidation perimeter.
On July 30, 2013, was approved at the General Shareholders’ Meeting of FC Porto Media, S.A.,
the increase of its share capital from 50,000 Euro to 4,050,000 Euro by the reinforcement of four
million Euro, carried solely by the shareholder Football Club Porto - Futebol, SAD as follows: (i) in
the form of new contributions in kind - conversion of loans into equity in the amount of 1,355,850
Euro, through the issue of 271,170 shares with a nominal value of 5 Euro each and (ii) in the form
of new cash inflows in the amount of 2,644,150 Euro, through the issuance of 528,830 shares with
a nominal value of 5 Euro each.
In the sequence of this capital increase operation in FC Porto - Media, S.A., FC Porto, SAD now
holds directly 98.78% of the subsidiary’s share capital (which corresponds to a total holding
percentage, directly and indirectly, of 98.81%) and the control of that company, therefore it was
included in the consolidation perimeter by the full consolidation method with reference to that
date.
The fair value of assets and liabilities at the date of the first consolidation of that subsidiary (July
31, 2013), as well as the computation of goodwill generated, was as follows:
___________________________________________________________________________________________
53
2013/2014
___________________________________________________________________________________________
Assets
Tangible fixed assets
Costumers
Cash and cash deposits
Liabilities
Auppliers
Net assets
Total effective percentage
262,933
902,946
340,207
2,149,061
(1,851,128)
(690,469)
1,113,550
98.81%
Equity value acquired
1,100,330
13,220
1,113,550
(i)
Capital increase amount
Investment of the Group on FCP Media
before the capital increase operation
Acquisition value
4,000,000
2,000
4,002,000
(ii)
Computed Goodwill
2,901,670
(iii) = (ii) - (i)
The goodwill of the FCP - Media, S.A., arising from the acquisition, was computed based on the
financial statements of the subsidiary acquired as of July 31, 2013. In fair value allocating exercise
of the assets and liabilities acquired, no differences were detected when comparing with its book
value, so the difference between these and the value of the investment was recorded as Goodwill.
However, the determination of the Goodwill has been provisionally determined, as the Group can
proceed to its recalculation and recognition of eventual adjustments to those provisional values
within twelve months after the acquisition date.
If this acquisition had been reported as of July 1, 2013, the revenue of the Group for the year
ended as of June 30, 2014 would have increased in the amount of approximately 282,000 Euro
and net income would have decreased by approximately 53,000 Euro.
7. TANGIBLE AND OTHER INTANGIBLE ASSETS
During the years ended 30 June 2014 and 2013, the movements in tangible and other intangible
assets, as well as depreciation and accumulated impairment losses, were as follows:
___________________________________________________________________________________________
54
2013/2014
___________________________________________________________________________________________
Tangible Assets
30.06.2014
Buildings and
other
constructions
Machinery and
equipm ent
Vehicles
Office
equipment
Other
tangible
assets
Tangible fixed
assets in
progress
Total
Gross cost:
Opening balance (30.06.2013)
Changes in consolidation perimeter (Note 6)
Additions
Disposals
Regularizations
Closing balance (30.06.2014)
822,598
279,500
1,102,098
3,438,884
6,428
3,445,312
1,264,527
37,303
(158,600)
1,143,230
2,292,025
831
2,292,856
256,679
256,679
218,551
(218,551)
-
8,293,264
280,331
43,731
(158,600)
(218,551)
8,240,175
Accumulated depreciation
and impairment losses
Depreciations
Sales
Regularizations
714,362
17,029
86,500
(2,353)
815,538
2,599,694
197,469
2,797,163
1,129,255
66,858
(158,599)
1,037,514
2,037,514
369
98,260
2,136,143
251,333
5,078
256,411
-
6,732,158
17,398
454,165
(158,599)
(2,353)
7,042,769
Carrying amount
286,560
648,149
105,716
156,713
268
-
1,197,406
Tangible Assets
30.06.2013
Buildings and
other
constructions
Machinery and
equipment
Vehicles
Office
equipment
Other
tangible
assets
Tangible fixed
assets in
progress
Total
Gross cost:
Additions
Sales
Transfers
811,598
11,000
822,598
3,164,753
150,967
123,164
3,438,884
1,511,191
(246,664)
1,264,527
2,292,025
2,292,025
256,679
256,679
123,164
218,551
(123,164)
218,551
8,159,410
380,518
(246,664)
8,293,264
Depreciation
Sales
636,406
77,956
714,362
2,337,647
262,047
2,599,694
1,244,199
131,720
(246,664)
1,129,255
1,895,974
141,540
2,037,514
242,696
8,637
251,333
-
6,356,922
621,900
(246,664)
6,732,158
Carrying amount
108,236
839,190
135,272
254,511
5,346
218,551
1,561,106
30.06.2014
Industrial
property
Others
Total
Gross cost
Additions
2,344,848
120,749
2,465,597
227,432
227,432
2,572,280
120,749
2,693,029
Depreciation
668,603
36,476
705,079
155,124
68,698
223,822
823,727
105,174
928,901
1,760,518
3,610
1,764,128
Carrying amount
___________________________________________________________________________________________
55
2013/2014
___________________________________________________________________________________________
30.06.2013
Industrial
property
Others
Total
Gross cost
Additions
2,344,848
2,344,848
226,632
800
227,432
2,571,480
800
2,572,280
Depreciation
647,287
21,316
668,603
81,851
73,273
155,124
729,138
94,589
823,727
1,676,245
72,308
1,748,553
Carrying amount
The caption ‘Industrial property’ relates, essentially, to the right to use the FCP trademark during
a period of 99 years, and is being amortised over that period.
8. INTANGIBLE ASSETS - PLAYERS’ REGISTRATIONS
During the financial years ended 30 June 2014 and 2013, the movement in ‘Players’
registrations’ as well as depreciation and accumulated impairment losses, was as follows:
Intangible assets
- 'Players' registrations
30.06.2014
30.06.2013
Gross cost:
Opening balance
Acquisitions
Sales
Transfers (Note 9)
Write-offs (Note 27)
Closing balance
120,789,429
18,789,708
(20,827,879)
(8,599)
(1,044,143)
117,698,516
156,767,366
46,509,554
(71,235,609)
(2,883,182)
(8,368,700)
120,789,429
and impairment losses:
Opening balance
Depreciation (Note 27)
Impairment losses (Note 27)
Utilization of impairment losses
Sales
Transfers (Note 9)
Write-offs (Note 27)
Closing balance
44,630,531
26,379,179
563,333
(14,524,217)
(855,951)
56,192,875
57,512,037
26,225,716
300,842
(3,988,349)
(28,090,273)
(1,596,314)
(5,733,128)
44,630,531
61,505,641
76,158,898
Carrying amount
___________________________________________________________________________________________
56
2013/2014
___________________________________________________________________________________________
Acquisitions
The main acquisitions made in the year ended 30 June 2014, in amount, can be resumed as follow:
Player
Quintero
Ghilas
Kayembe
Igor Lichnovski
Others
Economic
rights
Acquisition
percentage
date
50%
50%
85%
100%
Jul-13
Jul-13
Jun-14
Jun-14
Vendor
Delfino Pescara 1936 SRL
Moreirense
Danubio GmbH
Universidade do Chile
Contract
end date
Jun-17
Jun-17
Jun-19
Jun-18
Acquisition
cost
Additional
expenses
5,000,000
3,800,000
2,615,000
1,837,000
Total
acquisition
cost
800,000
61,587
100,000
5,800,000
3,800,000
2,676,587
1,937,000
5,050,444
19,264,031
Discounting effects to NPV
(474,323)
Carrying amount
18,789,708
The caption “Additional expenses” refers to expenses related to the purchase of players’
registrations, namely charges for intermediation services, legal services, signing-on fees paid
directly to the players, etc.
It should be noted that in situations where the registration is less than 100%, although the
Company is entitled to full use of the player’s registration, it has entered into an associated
financial interests contract with a third party, which consists of an investment partnership in the
registration rights, resulting in the proportional sharing of the inherent results in a future
transaction of these rights, if it happens.
The main acquisitions made in the year ended 30 June 2013, in amount, can be resumed as follow:
Player
Jackson Martinez
Diego Reyes
Herrera
James Rodriguez
Hector Quiñones
Ricardo Pereira
Licá
Mauro Caballero
Others
Economic
rights
Acquisitio
percentage
n date
100%
95%
80%
35%
100%
80%
60%
100%
-
Jul-12
Dez-12
Mai-13
Jan-13
Ago-12
Abr-13
Mai-13
Jan-13
-
Vendor
Contract
end date
Club Jaguares de Chapas
Club de Futbol América
Pachuca Club de Fútbol
Gol Football Luxembourg
Asociación Deportivo Cali
Vitória Sport Clube
Estoril Praia
MHD, S.A.
-
Jun-16
Jun-18
Jun-17
Jun-16
Jun-16
Jun-18
Jun-17
Jun-18
-
Acquisition
cost
8.887.453
7.000.000
8.000.000
8.750.000
1.982.396
1.600.000
1.500.000
1.531.863
-
Signatue
bonuses
Additional
expenses
517.320
700.000
Total
acquisition
cost
750.000
2.092.320
1.000.000
99.120
100.000
150.000
-
9.637.453
9.092.320
9.000.000
8.750.000
2.081.516
1.700.000
1.650.000
1.531.863
5.274.516
48.717.668
Discounting effects to NPV
(2.208.114)
Carrying amount
46.509.554
-
The charges for intermediation services related with the purchase of players’ registrations in the
years ended 30 June 2014 and 2013 referred above, as well as with the negotiation and
renegotiation of labour contracts with players, amounted to 4,829,328 Euro and 2,539,120 Euro,
respectively.
In the financial year ended 30 June 2014 these services were provided by Pearl Design Holding
Limited,
Edenresults, Danubio GmbH, DNN Lda., Idolasis, Soc. Unipessoal, Lda., Onsoccer,
Gestão de Carreiras Desportivas S.A., Foot Expande, Lda. RAMP Managment Group International,
DL Soccer Service SAS, Unifoot – Gestão e Eventos de Carreiras de Profissionais Desportivas, SA,
___________________________________________________________________________________________
57
2013/2014
___________________________________________________________________________________________
Asesorias e Inversiones Aim Futbol Limitada, C.B. Nafricatalentsport, Lda., SportConsult and
Pacheco & Teixeira, Lda and by the agent Ricardo Calleri.
In the financial year ended 30 June 2013 these services were provided by Northfields Sports BV,
Grupo Comercializador Conclave S.A., Gondry Financial Services, Foot2Foot - Gestão de Carreiras
Desportivas, Lda., Promosport, JOD Gestão de Carreiras Desportivas, Lda., Proeleven - Gestão
Desportiva Lda., Energy Soccer Lda., Magnitude Partnership e by the agent Giancarlo Uda.
The amounts of players registrations’ purchases in the years ended as of June 30, 2014 and 2013,
consider the effect of discounting future payments to its present value, where applicable, in the
amounts of, approximately, 798,204 Euro and 2,208,000 Euro, respectively. These amounts refer
to the long term account payables balances related with the acquisition of the registrations of
players, namely Ghilas, Quintero, Kayembe, Opare and Igor Lichnovski (as of June 30, 2014) and
Jackson Martinez, Diego Reyes, Herrera, Hector Quinones and James Rodriguez (as of June 30,
2013).
Sales
Sales made during the financial year ended 30 June 2014 generated capital gains of 22,397,504
Euro (Note 27) which result mainly from:
a) sale of the registration rights of Atsu to Chelsea, by the amount of 3,000,000 Euro, generating
capital gains of 1,991,667 Euro after the deduction of (i) the effect of discounting future
medium term receipts and payments to its present value arising from these transactions; (ii)
the proportional sale value of the registration player’s owned by third parties (25%); (iii)
intermediation service costs provided by Energy Soccer and (iv) the carrying amount of the
player’s registration on the date of sale, in the global amount of 1,008,333 Euro;
b) sale of the registration rights of Otamendi to Valencia, by the amount of 12,000,000 Euro,
generating capital gains of 7,980,195 Euro, after deduction of: (i) the effect of discounting
future medium term receipts and payments to its present value arising from these
transactions; (ii) the proportional sale value of the registration player’s owned by third
parties; (iii) intermediation service costs provided by Vela Management Limited; and (iv) the
carrying amount of the player’s registration on the date of sale in the global amount of
4,026,000 Euro. Additionally this agreement foresees the payment of a variable
remuneration, payable upon the achievement of certain sport objectives by the athlete, so
the global amount receivable could rise up to 15,000,000 Euro;
c) sale of the registration rights of André Castro to Kasimpasa, by the amount of 2,058,000 Euro,
generating capital gains of, approximately, 1,654,000 Euro, net of: (i) the effect of discounting
future medium term receipts and payments to its present value arising from these
transactions; (ii) intermediation service costs provided by Pacheco & Teixeira, Ltd.; (iii) the
proportional sale value of the registration player’s owned by third parties (5%); (iv) liabilities
relating to the ‘solidarity mechanism’, and (v) the carrying amount of the player’s registration
on the date of sale in the global amount of approximately 404,000 Euro;
d) sale of the registration rights of Fernando to Hellas Manchester City, by the amount of
15,000,000 Euro, generating capital gains of, approximately, 5,298,000 Euro, net of: (i) the
effect of discounting future medium term receipts and payments to its present value arising
___________________________________________________________________________________________
58
2013/2014
___________________________________________________________________________________________
from these transactions; (ii) intermediation service costs provided by Onsoccer Internacional
Career Gestão de Carreiras, SA; (iii) the proportional sale value of the registration player’s
owned by third parties (20%); (iv) amounts payable to the player as indemnity; and (v) the
carrying amount of the player’s registration on the date of sale in the global amount of
approximately 9,702,000 Euro;
e) sale of the registration rights of Iturbe to Hellas Verona Football Club, by the amount of
15,000,000 Euro, generating capital gains of, approximately, 4,736,000 Euro, net of: (i)
intermediation service costs provided by IG Teams & Players, SA; (ii) the proportional sale
value of the registration player’s owned by third parties (55%); and (iii) the carrying amount
of the player’s registration on the date of sale in the global amount of approximately
10,264,000 Euro;
The disposals in the year ended June 30, 2013, which generated capital gains in the amount of
74,016,304 Euro (Note 27), resulted mainly from:
a) sale of the registration rights of James Rodriguez to AS Monaco, by the amount of
intermediation service costs provided by the entity Gestifute; (ii) the proportional sale
value of the registration player’s owned by Orel (10%) ; (iii) liabilities relating to the
‘solidarity mechanism’; (iv) the carrying amount of the player’s registration on the date of
sale, in the global amount of, approximately, 19,243,000 Euro.
b) sale of the registration rights of Hulk to Zenit St. Petersbourg, by the amount of
40.000.000 Euro, generating capital gains of, approximately, 23.871.000 Euro, net of: (i)
the effect of discounting future medium term receipts and payments to its present value
arising from these transactions (ii) the carrying amount of the player’s registration on the
date of sale and (iii) the annulment of loyalty bonuses in the global amount of,
approximately, 16,129,000 Euro;
c) sale of the registration rights of João Moutinhho to AS Monaco, by the amount of
intermediation service costs provided by the entity Gestifute; (ii) the right to receive 25%
of the capital gains by a higher value of 11,000,000 Euro by Sporting Clube de Portugal –
Futebol, SAD (“Sporting SAD”) established in the original contract of purchase of
economic rights to this entity (iii) liabilities relating to the ‘solidarity mechanism’; and (iv)
the carrying amount of the player’s registration on the date of sale, in the global amount
of, approximately, 9,929,000 Euro;
d) sale of the registration rights of Álvaro Pereira to Inter Milan, by the amount of 10,000,000
Euro, generating capital gains of, approximately, 4,550,000 Euro, net of: (i) intermediation
service costs provided by the entity IG Teams & Players; (ii) the proportional sale value of
the registration player’s owned by Cluj (20%) and Avendi (5%); (iii) the effect of
discounting future medium term receipts and payments to its present value arising from
these transactions; and (iv) the carrying amount of the player’s registration on the date
of sale, in the global amount of approximately 5,450,000 Euro. Additionally this
agreement foresees the payment of a variable remuneration, payable upon the
achievement of certain sport objectives by athlete and the club, so the total amount
___________________________________________________________________________________________
59
2013/2014
___________________________________________________________________________________________
receivable could rise up to 15,000,000 Euro; in 2012/13 season the Company recognized
an additional income of 1,000,000 Euro, regarding this clause.
Additionally, in January 2013, was sold 47.5% of the economic rights of the player Diego Reyes to
Gol Football Luxembourg for 3,500,000 Euro; this operation did not generate any capital gains or
losses.
Impairment losses
During the financial year ended 30 June 2014, impairment losses amounting 563,333 Euro were
recorded related with the registration of the players Stefanovic because FCP SAD terminated the
labour contract with this player during the season 2014/15 and Izmailov, by the fact of the player
has been lent during the season 2014/15 being this the last season with labour contract.
Additionally, during the year ended June 30, 2014, player registrations with a net value of 188,192
Euro were write-offed, related to the players Lucho Gonzalez and Thibaut Vion by the fact that
FCP SAD terminated the labour contract with this players during the season.
During the financial year ended 30 June 2013, impairment losses amounting 300,842 Euro were
recorded related with the registration of the players Emídio Rafael, Bracali, Ukra and Sereno by
the fact that FC Porto SAD terminated the labour contract with this players during the sports
season of 2012/2013 or in the beginning of the sports season 2013/14.
Players’ registrations
As of 30 June 2014 and 2013, the aggregation of the players by range of its’ registrations net book
value is as follows:
Carrying amount of
players registrations
Greather than 2 million Euro
Between 1 and 2 million Euro
Less than 1 million Euro
30.06.2014
Number of
players
Amount
30.06.2013
Number of
players
Amount
10
7
28
42,003,228
9,979,852
9,522,561
12
6
19
59,667,316
8,568,576
7,923,006
45
61,505,641
37
76,158,898
As of 30 June 2014 and 2013, in the carrying amount of players’ registrations are included the
following players:
___________________________________________________________________________________________
60
2013/2014
___________________________________________________________________________________________
30.06.2014
Players'
End of
registration (%)
Contract
100.0%
jun/16
80.0%
jun/17
100.0%
jun/16
50.0%
jun/17
47.5%
jun/18
100.0%
jun/16
Player
Danilo
Herrera
Jackson Martinez
Quintero
Diego Reyes
Alex Sandro
Defour (b) (e)
Mangala (b) (e)
Ghilas (a)
Kayembe
Igor Lichnoski
Walter da Silva (b) (c)
Kléber
(a)
Caballero (a)
Kelvin
Ricardo Pereira
Licá
(a)
Hector Quiñones
Iturbe (d)
Otamendi (d)
(a)
30.06.2013
Players'
End of
registration (%)
Contract
100.0%
jun/16
80.0%
jun/17
100.0%
jun/16
-
-
47.5%
100.0%
jun/18
jun/16
jun/16
jun/16
56.7%
56.7%
jun/16
jun/16
56.7%
56.7%
50.0%
85.0%
100.0%
15.0%
jun/17
jun/19
jun/18
jun/17
-
70.0%
jun/16
70.0%
jun/16
70.0%
75.0%
80.0%
jun/18
jun/16
jun/18
100.0%
75.0%
80.0%
jun/18
jun/16
jun/18
60.0%
jun/17
60.0%
jun/17
100.0%
jun/16
100.0%
jun/16
-
45.0%
100.0%
jun/16
jun/15
-
40.0%
-
jun/15
(a) Player loaned to another club or sports entity in the season 2014/15, whose loan period is not beyond June 30,
2015;
(b) Players whose percentage of economic rights evidenced is deduced, as of June 30, 2014, the share of 50% (Walter
da Silva) and 33.33% (Mangala and Defour) transferred to third parties by associated financial interests contracts;
(c) Player loaned to another club or sports entity in sports season 2013/14, but which the loan period is not beyond
December 31, 2015;
(d) Player whose registration rights was sold to another club or sports entity during the 2013/14 sports season;
(e) Player whose registration rights was sold to another club or sports entity during the 2014/15 sports season (Note
36)
The registrations’ percentages presented above take into consideration the sharing of economic
rights made on the acquisition date of each player’s registration, or its sale at a later date, as well
as the percentages assigned by FCPorto SAD to third parties related with the sharing of the
amount resulting from a future sale of these rights.
In addition, commitments were established with third parties, including clubs and sports agents,
in order to share the amount of future capital gains that may be obtained through FC Porto SAD
players registration rights’ sale, upon verification of specific contractual conditions.
As of 30 June 2014, FCP SAD kept player’s registrations that had been pledged as security for
loans, as follow:
___________________________________________________________________________________________
61
2013/2014
___________________________________________________________________________________________
Amount
30.06.2014
Bank
Millennium BCP
BES
BES
3,750,000
30,000,000
1,750,000
Due date
30/06/2017
31/10/2014
31/01/2016
Player registrations'
Helton
Mangala e Jackson
Mangala e Jackson
End of
contract
Jun17
Jun16 / Jun 17
Jun16 / Jun 17
Additionally, buy and sale option rights contracts regarding players’ economic rights were
established with third parties, namely clubs and sports agents, exercisable for periods and
amounts contractually established.
9. OTHER FINANCIAL ASSETS
During the financial years ended 30 June 2014 and 2013, the movements under the caption ‘Other
financial assets’ as well as accumulated impairment losses, were as follows:
Other financial assets
30.06.2014
30.06.2013
Gross cost:
Opening balance
Adjustments
Transfers (Note 8)
Disposals
Write-offs
Closing balance
3,951,834
(1,999)
8,599
(2,035,398)
1,923,036
3,608,147
(1)
1,286,868
(52,500)
(890,680)
3,951,834
and impairment losses:
Opening balance
Impairment losses for the period (Notes 22 and 30)
Disposals
Write-offs
Closing balance
1,705,266
1,532,169
(2,035,398)
1,202,037
890,680
1,731,516
(26,250)
(890,680)
1,705,266
720,999
2,246,568
Carrying amount
The detail of this caption as of 30 June 2014 and 2013 is as follows:
___________________________________________________________________________________________
62
2013/2014
___________________________________________________________________________________________
Description
30.06.2014
Acquisition
% Held
cost
30.06.2013
Acquisition
% Held
cost
15,120
17,119
Other entities
Other investments
Economic rights of players
Tomás Costa
Stepanov
Prediger
Souza
Soares
Orlando Sá
Other players
Accumulated impairment losses (Note 22)
50%
25%
70%
-
664,950
658,333
448,000
-
50%
50%
50%
25%
70%
25%
861,465
818,750
664,950
658,333
448,000
355,183
136,633
1,907,916
128,035
3,934,716
(1,202,037)
(1,705,267)
720,999
2,246,568
The caption ‘Other financial assets’, detailed above includes economic rights of several players,
whose sporting rights were sold by FCPorto SAD, while keeping part of their economic rights.
During the year ended 30 June 2014 were estimated impairments related to these players’
economic rights that match the best Board of Directors’ estimate of the recoverable value
expected from these investments.
10. GOODWILL
In the year ended June 30, 2014 and 2013, the detail of goodwill is as follows:
PortoSeguro
FC Porto - Media, S.A.
30.06.2014 30.06.2013
238,045
238,045
2,901,670
3,139,715
238,045
This balance as of June 30, 2014, refers to the Goodwill computed as follow:
(i)
(ii)
During the year ended June 30, 2014, following the capital increase operation in FCP
Media, S.A., the FCP SAD holds now 98.78% of the its share capital in the amount of
2,901,670 Euro as described in Note 6.
During the year ended June 30, 2007, in the acquisition of 90% of the share capital of
PortoSeguro, Lda., in the amount of 717, 647 Euro, deducted from the accumulated
impairment losses calculated in previous years in the amount of 479,602 Euro.
The Group carries out annual impairment tests on goodwill and whenever there are indications
that it may be impaired. During the years ended 30 June 2014 and 2013, the Group has tested the
goodwill impairment, having estimated an impairment loss in the amount 221,000 Euro related
to the subsidiary PortoSeguro at the year ended June 30, 2013.
___________________________________________________________________________________________
63
2013/2014
___________________________________________________________________________________________
For impairment assessment purposes of the subsidiaries PortoSeguro and FC Porto – Media, S.A.,
the recoverable amount of the Cash Generating Unit was calculated based of value in use, using
the discounted cash flow method, based on the business plan developed by the company’s
representative and duly approved by the Group’s Board of Directors.
The key assumptions used in the mentioned business plan are as follows:
Period used: 5 years cash-flow projection
Growth rate (g)(1): 2.0%
Discount rate (2): 10,7%
(1)
(2)
Growth rate used to extrapolate cash flows beyond the business plan period
Discount rate applied to projected cash flows
The Board of Directors, based on the discounted value of the forecasted cash flows of the Cash
Generating Unit of these business segments, discounted at the rate of 10.7%, concluded that, as
of 30 June 2014, the recoverable amounts exceed the carrying amount of their net assets, not
having been established any additional need of impairment recognition.
The projected cash flows were based on the historic performance and on the expectations
regarding future development of the business.
11. TRADE RECEIVABLES
Non-current assets
The detail of non-current balances of ‘Trade receivables’ as of 30 June 2014 and 2013 is as follows:
30.06.2014
30.06.2013
Trade receivables:
Transactions of players' registrations
Futebol Clube do Porto
Effect of discouting trade receivables
11,243,921
11,243,921
13,500,000
12,268,718
25,768,718
-
(1,001,965)
11,243,921
24,766,753
The balance of the caption ‘Non-current assets - Trade receivables - Futebol Clube do Porto’ refers
to the medium and long term Futebol Clube do Porto’s account receivable.
The FCPorto, SAD Board of Directors’, together with the FCP Clube Management, defined an
action plan to reduce the debt gradually, having this plan been formalized as of 30 June 2011. This
payment plan requires the Club endowment of financial capacity through a set of different
measures such as: (i) change of the actual operating model of Futebol Clube do Porto Group,
based in the transference of the Dragon Stadium rents’ related income to the Club; (ii) revision of
the price policy and internal redistribution of the quotas of the associates between the Club and
___________________________________________________________________________________________
64
2013/2014
___________________________________________________________________________________________
FCPorto, SAD; and (iii) the amateur sports’ medium term budget rationalization under the Club´s
management.
The mentioned plan, which estimates the recovery of that amount trough fifteen years, until the
season of 2025/26, considers an interest rate at Euribor 6M, increased of a 6% spread.
The payment plan assumes the settlement of biannual raising instalments (capital and interests),
with maturity in 31 December and 30 June of each sporting season. In the season 2014/15 two
instalments totalizing 740,197 Euro of capital and 759,803 Euro of interests will take place at
interest rate above referred. On medium and long term, the maturity of those instalments can be
resumed as follows:
Maturity
Capital
Interests
01.07.2015 a 30.06.2016
621,636
878,364
01.07.2016 a 30.06.2020
3,422,712
2,939,970
01.07.2020 a 30.06.2026
7,199,572
1,754,873
11,243,921
5,573,206
At the time of the statement of financial position, the non-current receivables are not due and
was not recorded any impairment losses on these.
Current assets
The detail of current balances of ‘Trade receivables’ as of 30 June 2014 and 2013 is as follows:
30.06.2014
30.06.2013
Trade receivables - current accounts:
Current operations
Trade receivables - bills receivable:
Current operations
Trade receivables - doubtfull accounts:
Effect of discouting trade receivables
Accumulated impairment losses (Note 22)
40,313,212
19,925,711
44,367,319
15,586,676
60,238,923
59,953,995
5,000,000
5,000,000
4,450,000
4,450,000
4,878,254
5,042,712
70,117,177
69,446,707
(740,393)
(4,878,255)
(274,594)
(5,042,712)
64,498,529
64,129,401
As of 30 June 2014 and 2013 the balance of the current and non-current caption “Trade
receivables - Transactions of players' registrations” includes, essentially, the following receivables:
___________________________________________________________________________________________
65
2013/2014
___________________________________________________________________________________________
Entity
Valencia CF
Zenit St Petersburg
Manchester City
Atlético de Madrid
Fluminense FC
Olympique Lyon
Chelsea FC
Kasimpasa
Inter Milão
AS Monaco
Others
jun/14
Current
Non Current
11,000,000
10,000,000
7,500,000
3,875,803
2,125,000
1,661,788
1,500,000
1,058,000
1,592,622
40,313,212
-
jun/13
Current
Non Current
10,000,000
10,000,000
12,750,000
3,500,000
1,661,788
9,500,000
3,500,000
3,500,000
3,455,531
44,367,319
13,500,000
On June 30, 2014, the balances receivable from entities mentioned above resulted essentially
from the sale of the economic rights of the players Otamendi, Hulk, Fernando Falcao, Ruben
Micael, Walter, Lisandro Lopez, Cissokho, Atsu and Andre Castro.
The account receivables from Zenit St. Petersbourg and Valencia CF were settled after June 30,
2014.
The balance of the caption ‘Trade receivables - Current Accounts - Current operations’ includes
balances resulting from several operations, with emphasis on the account receivables of:
(i)
Futebol Clube do Porto (“Clube”) (5,736,126 Euro as of 30 June 2014 and 989,679 Euro as
of 30 June 2013);
(ii) Euroantas, Promoção e Gestão de Empreendimentos Imobiliários S.A. (“Euroantas”)
(7,102,589 Euro as of 30 June 2014 and 5,715,804 Euro as of 30 June 2013);
(iii) Portugal Telecom SGPS, S.A. (2,244,750 Euro as of 30 June 2014 and 2,469,004 Euro as of
30 June 2013).
The caption ‘Trade receivables – bills receivable’ includes bills not due at the end of the reporting
period, part of which were discounted (Note 18). As of 30 June 2014 and 2013, these bills are
related to accounts receivable resulting from the sale of television broadcasting rights.
The Group's exposition to credit risk is attributed to accounts receivable relating with its’
operational activity. The amounts presented on the face of the statement of financial position are
net of impairment losses, which were estimated, based upon the Group’s past experience and on
the assessment of the actual situation and economic environment. The Group considers that the
book value of accounts receivable, net of impairment losses, reflects their fair value.
As of 30 June 2014 there are no indications that the debtors of trade accounts receivable not due
will not fulfil their obligations on normal conditions, thus no impairment loss was recognised.
As of 30 June 2014 and 2013 the ageing of trade receivables are as follows:
___________________________________________________________________________________________
66
2013/2014
___________________________________________________________________________________________
Due date
30.06.2014
Total
- 90 days
90 - 180 days
180 - 360 days
+ 360 days
Trade receivables - current accounts
Current operations
60,238,923
40,313,212
19,925,711
42,862,552
38,342,945
4,519,607
1,689,711
1,689,711
5,928,599
5,928,599
9,758,061
1,970,267
7,787,794
Trade receivables - bills receivable
Trade receivables - doubtfull accounts
5,000,000
4,878,254
5,000,000
-
-
129,777
4,748,477
70,117,177
47,862,552
1,689,711
6,058,376
14,506,538
Due date
30.06.2013
Total
- 90 days
90 - 180 days
180 - 360 days
+ 360 days
Trade receivables - current accounts
Current operations
59,953,995
44,367,319
15,586,676
43,516,614
36,033,417
7,483,197
5,435,355
4,682,671
752,684
2,930,820
1,889,096
1,041,724
8,071,206
1,762,135
6,309,071
Trade receivables - bills receivable
Trade receivables - doubtfull accounts
4,450,000
5,042,712
4,450,000
-
-
-
5,042,712
69,446,707
47,966,614
5,435,355
2,930,820
13,113,918
At June 30, 2014 and 2013 the majority of the balance of "Trade receivables – current accounts Transactions of players’ registrations” with seniority over 360 days, refers essentially to
receivables from Olympique Lyon regarding interests from the sale of the economic rights of
Lisandro Lopez and Cissokho, having FCP, SAD received, after June 30, 2014, an amount of
approximately 1,000,000 Euro. Since the nature of the invoices paid after June 30, 2014 (having
the Company obtained a communication from FIFA's decision of the Player's Status Committee
condemning Lyon to its payment) is the same of invoices still outstanding after that same date,
the Board of Directors of the Company believes that the remaining amount is due and recoverable
by which does not considers the need to record any impairment loss regarding this account
receivable.
As of June 30, 2014 and 2013 almost of the balance of "Trade receivables - current accounts Transactions of players’ registrations” with seniority over 180 days refers to contractually defined
amounts. There are no cases of significant settlement delays.
As of June 30, 2014 and 2013 a significant portion of the balance of "Trade receivables - current
accounts - Current operations" with seniority over 180 days refers to the accounts receivables
from FC Porto and Euroantas, both related parties belonging to the Futebol Clube do Porto Group.
As of June 30, 2014 and 2013 the balance of "Doubtful Accounts receivable" includes, mainly,
receivables from football clubs, such as União Desportiva de Leiria, Futebol, Futebol SAD, Club
Atlético Independiente and Esporte Clube Vitória.
In determining the recoverability of accounts receivable the Group considers all the changes in
credit quality of counterparties from the date the granting of credit by the reporting date of the
consolidated financial statements. The Group has no significant concentration of credit risk, since
the risk is diluted by a scattered set of customers. Management believes that credit risk does not
exceed the impairment loss recorded for doubtful debts and that the maximum exposure to credit
risk corresponds to the total number of costumers shown in the consolidated statement of
financial position.
___________________________________________________________________________________________
67
2013/2014
___________________________________________________________________________________________
12. INVENTORIES
The detail of the caption ‘Inventories’ as of 30 June 2014 and 2013 is as follows:
30.06.2014
Inventories
Accumulated impairment losses on inventories (Note 22)
30.06.2013
1,974,275
1,415,250
(377,293)
(302,696)
1,596,982
1,112,554
The inventories’ caption, as of 30 June 2014 and 2013, considers the merchandise related with
the exploration of the commercial areas of Futebol Clube do Porto, carried out by the subsidiary
Porto Comercial.
The cost of sales, for the years ended 30 June 2014 and 2013 was calculated as follows:
30.06.2014
Opening balance
Purchases
Closing balance
Impairment losses (Note 22)
1,415,250
3,091,357
1,974,275
2,532,332
74,597
2,606,929
30.06.2013
916,896
2,411,386
1,415,250
1,913,032
151,481
2,064,513
13. OTHER CURRENT AND NON-CURRENT ASSETS
Other non-current assets
The detail of caption "Other non-current assets" as of 30 June 2014 and 2013 is as follows:
30.06.2014
Prepayment - 'Estádio do Dragão' rent (Note 34)
Prepayment - 'Centro de treinos do Olival' rent
Prepayment - Museum exploitation
Deferred expenses - contract loans of players
14,963,937
253,012
9,375,000
100,000
24,691,949
30.06.2013
14,963,937
289,157
15,253,094
During the year ended June 30, 2014 was signed between PortoComercial and the Futebol Clube
do Porto a contract for the exploitation of the FCP Museum (which opening to the public occurred
in October 2013). Under this contract PortoComercial acquired the right to explore the museum
during a period of 8 years and paid in advance the amount of 12 million Euro relating to
outstanding rents. On June 30, 2014 the caption “Other non-current assets - Museum
exploitation” correspond to the rents for the year 2015/16 and following.
___________________________________________________________________________________________
68
2013/2014
___________________________________________________________________________________________
The detail of caption "Other current assets" as of 30 June 2014 and 2013 is as follows:
30.06.2014
State and public sector
Other debtors
Accrual income
Champions league participation bonus (Note 2.3 l) iv))
to be received
Interests receivable from group companies
Advirtising revenue to be billed
Insurance claims
Bonus for FC Porto, SAD players participation in the
Football World Cup 2014 to receive
Other accrual income
Deferred expenses
Advances for expenses relating to the next season
Prepayment - Museum exploitation
Insurance
Other deferred expenses
30.06.2013
4,778,499
2,594,626
7,373,125
2,657,658
8,925,603
11,583,261
2,100,000
8,600,000
393,845
472,044
381,600
177,567
-
555,572
137,378
474,926
1,800,571
1,500,000
303,945
53,143
7,698,098
1,707,373
218,478
58,212
11,236,556
15,071,223
22,819,817
As of 30 June 2014, the amount recorded in the caption “Other debtors” includes advances to
athletes (1,140,527 Euro). As of June 30, 2013 this caption refers essentially to (i) advances to
athletes (755,719 Euro), as well as (ii) advances made to Futebol Clube do Porto (6,547,669 Euro)
intended, mainly to the construction of the Futebol Clube do Porto Museum, which was
inaugurated in October 2013.
As of June 30, 2014 and 2013 the caption "Advances for expenses relating to the next season"
includes essentially deferred expenses related to scouting contracts (940,260 Euro as of June 30,
2014 and 844,270 Euro as of June 30, 2013), deferred costs with players’ loans and intermediation
costs from technical staff hiring (808,200 Euro as of June 30, 2014) and sports equipment (413,102
Euro on June 30, 2013).
As of 30 June 2014 and 2013 the ageing of other debtors is as follows:
Due date
30.06.2014
Athletes
Other debtors
Total
- 90 days
90 - 180 days 180 - 360 days
+ 360 days
1,140,527
1,454,099
46,709
1,056,509
-
309,231
-
784,587
397,590
2,594,626
1,103,218
-
309,231
1,182,177
___________________________________________________________________________________________
69
2013/2014
___________________________________________________________________________________________
Due date
30.06.2013
Athletes
Other debtors
Total
- 90 days
90 - 180 days 180 - 360 days
+ 360 days
755,719
8,169,884
10,489
6,881,946
645,680
130,572
439,547
614,658
202,711
8,925,603
6,892,435
645,680
570,120
817,368
As of 30 June 2014 and 2013 the remaining financial assets recorded in the caption “Other noncurrent assets” and “Other current assets” are not due.
14. CASH AND CASH EQUIVALENTS
The caption ‘Cash and cash equivalents’ as of 30 June 2014 and 2013 is made up as follows:
30.06.2014
Cash
Bank deposits repayable on demand
4,550
14,695,889
Treasury applications
30.06.2013
5,385
17,547,401
265,000
265,000
14,965,439
17,817,786
As of 30 June 2014 and 2013 the amounts recorded in the caption “Treasury applications” refer
to bank deposits repayable in less than three months and bear market interest rates.
15. TAXES
The Group has not recognised deferred taxes in its consolidated financial statements as there are
no significant temporary differences between the amounts of expenses and income recognised
for accounting and for tax purposes, except for deferred tax assets relating to tax losses carried
forward and non-tax deductible provisions and impairment losses, which were not recognised for
reasons of prudence.
The tax losses carried forward according to the income declarations presented by the companies
included in the consolidation perimeter amounted to 116,619,727 Euro and mature as follows:
Amount
Generated in the year ended:
30 de Junho de 2009
Expiry date
11,233,087
30 June 2015
30 de Junho de 2010
12,066,788
30 June 2016
30 de Junho de 2011
12,895,224
30 June 2015
30 de Junho de 2012
39,861,295
30 June 2016
30 de Junho de 2013
1,675,950
30 June 2018
30 de Junho de 2014
38,887,383
116,619,727
30 June 2019
___________________________________________________________________________________________
70
2013/2014
___________________________________________________________________________________________
Following is the reconciliation between profit before income tax and income tax for the year:
30.06.2014
Profit before income tax
Increases:
Non tax deductible amortisation, depreciation and impairment of assets
depreciable or amortizable
Non tax deductible provisions
Fiscal gains
(1)
Accounting losses
(1)
Non tax deductible financing costs
30.06.2013
(37,487,992) 20,904,955
(3)
2,856,537
-
-
1,952,516
11,499,919
51,038,904
-
-
6,499,883
-
Adjustments not deductible or beyond the legal limits
260,494
158,859
Others
489,018
362,226
Decreases:
Accounting gains
(1)
Reversal of non tax deductible adjustments
Others
Taxable profit
Tax losses utilized
Tax base
Income tax rate
Municipal tax rate
Calculated tax
Municipality tax (2)
Autonomous taxation
Corporate income tax assessments
Payments under the RERD
Estimated income tax excess/(insufficiency)
Others
Income tax for the year
(22,296,904) (73,583,305)
(976,237)
(84,063)
(9,570)
(38,263,108)
(151,652)
(254,062)
-
(38,517,170)
(151,652)
25.0%
25.0%
1.5%
22,710
10,902
487,696
1.5%
767
8,443
271,227
-
309,725
2,713,591
-
213
(14,682)
(15,186)
(420)
3,219,926
575,060
(1) In the calculation of the taxable profit, the Group chose to consider the reinvestment of capital gains on
the sale of players registrations', in legal terms, which allowed to deduct 50% of tax capital gains generated
in the year.
(2) Municipality tax of companies taxed according to RETGS and which present taxable profit for the year.
(3) Limitation on the deductibility of financing costs in accordance with Article 67 of the Corporate Income
Tax – CIT (Código do Imposto sobre as Pessoas Colectivas) Code.
Under the Extraordinary Regime for the Settlement of Debts to Social Security and to Tax
Authority ("RERD") granted by the Ministry of Finance to the voluntary payments made by
taxpayers until December 31, 2013, regarding taxes due, the FC Porto SAD paid the amount of
4,227,685 Euro related to tax processes, using the provision recorded for this purpose in the
amount of 1,514,094 Euro (Note 22), recognizing the remaining difference as an expense for the
year, in the amount of 2,713,591 Euro. Notwithstanding the settlement of this amount, the
Company maintains the complaints and judicial claims, having the Company contingent assets
related with them as detailed in Note 35.
___________________________________________________________________________________________
71
2013/2014
___________________________________________________________________________________________
16. SHARE CAPITAL
As of 30 June 2014, the Company’s share capital was fully subscribed and paid for and was made
up of 15,000,000 nominal shares of 5 Euro each.
As of 30 June 2014 the following entities held more than 20% of the subscribed share capital:
- Futebol Clube do Porto – 40%
The individual financial statements of the Company as of 30 June 2014 present a shareholders’
negative equity in the amount of 28,512,038 Euro comparing with a share capital of 75,000,000
Euro, whereby the provisions of Articles 35 and 171 of the Portuguese Commercial Code (Código
das Sociedades Comerciais) are applicable.
With the goal to quickly fulfil this obligation, the Board of Directors has been analysing other
solutions that allow the reinforcement of shareholders’ equity as referred in the Board of
Directors’ Report.
The Board of Directors besides planning to review this matter on the Shareholders’ General
Meeting held to approve the accounts for the year, it may also call upon an Extraordinary
Shareholders’ General Meeting to discuss and approve the proposals that would be presented,
which can include the following alternatives:
• Share capital decrease to an amount not less than the Company’s shareholders’ equity;
• Capital increase paid up by the shareholders; and
• A combination of these two alternatives.
Following this, on September 10, 2014 was called a General Shareholders’ Meeting to be held on
2 October 2014 whose aim is the deliberation of a capital increase in the amount of 37,500,000
Euro (Note 36) of FC Porto SAD.
According to Article 171 of the Portuguese Commercial Code (Código das Sociedades Comerciais),
a company which shareholders’ equity is less than half of its share capital, should indicate the
share capital, the amount of share capital paid and the amount of shareholders’ equity according
to the last approved statement of financial position in all contracts, mail, publications, ads,
websites, and in overall external activity.
17. NON-CONTROLLING INTERESTS
The changes in this caption during the years ended 30 June 2014 and 2013 were as follows:
___________________________________________________________________________________________
72
2013/2014
___________________________________________________________________________________________
Net consolidated profit for the year attributable to non-controlling interests
Distribution of dividends
(115,678)
(26,102)
(44,444)
(186,224)
Net consolidated profit for the year attributable to non-controlling interests
(186,224)
(6,804)
13,220
(179,808)
18. BANK LOANS AND BONDS
The captions ‘Bank loans’ and ‘Bonds’ as of 30 June 2014 and 2013 are made up as follows:
Nature
30.06.2014
Amortised cost
Nominal value
Current
Non-current
Current
Non-current
Bank loans
Credit on current accounts
Factoring
Discounted bills (Note 11)
41,283,012
10,000,000
14,757,769
5,000,000
71,040,781
16,112,500
3,000,000
19,112,500
40,100,000
10,000,000
14,877,500
5,000,000
69,977,500
16,112,500
3,000,000
19,112,500
Bonds
29,591,657
19,395,933
30,000,000
20,000,000
100,632,438
38,508,433
99,977,500
39,112,500
Nature
Bank loans
Credit on current accounts
Factoring
Discounted bills (Note 11)
Bonds
30.06.2013
Amortised cost
Nominal value
Current
Non-current
Current
Non-current
23,964,514
5,100,000
9,489,500
4,450,000
43,004,014
13,125,000
100,000
13,225,000
22,475,000
5,100,000
9,489,500
4,450,000
41,514,500
13,125,000
100,000
13,225,000
9,617,134
29,526,645
10,000,000
30,000,000
52,621,148
42,751,645
51,514,500
43,225,000
As of 30 June 2014 the repayment schedule of the nominal value of non-current loans may be
summarised as follows:
30.06.2014
2015/2016
2016/2017
10,200,000
28,912,500
39,112,500
From the loans classified as liabilities at 30 June 2014, emphasis to:
___________________________________________________________________________________________
73
2013/2014
___________________________________________________________________________________________
Bank
Current
Noncurrent
Total
Open
date
Interest rate
Instalm ents
interest
Maturity
date
Guarantee / collateral
8.25%
6.75%
At face value at maturity
Semi-annual
Semi-annual
May-15
May-17
-
Loan issues
FC Porto SAD 2012-2015
FC Porto SAD 2014-2017
30,000,000
-
30,000,000
20,000,000 20,000,000
Dec-12
May-14
5,500,000
11,500,000 17,000,000
Aug-10
Bank loans
BES (*) (**)
Euribor 12M +
3 and successive annual
Anual
spread
installments
Euribor 6M + 4 semi-annual installments of equal
Semi-annual
spread
value
Euribor 3M +
Quarterly
spread
Euribor 1M + 34 monthly equal and consecutive
Monthly
spread
installments
Euribor 6M +
10 quarterly installments of equal
Quarterly
spread
value
Euribor 1M +
Monthly
spread
BES (*)
875,000
875,000
1,750,000
Jan-14
BES (*) (***)
30,000,000
-
30,000,000
Oct-13
BES (*)
1,650,000
-
1,650,000
Aug-12
Millennium BCP
825,000
1,237,500
2,062,500
Dec-13
Millennium BCP
1,250,000
2,500,000
3,750,000
May-99
Internationales Bankhaus
Bodensee AG
4,489,500
-
4,489,500
Dec-13
6.75%
Internationales Bankhaus
Bodensee AG
4,000,000
-
4,000,000
May-14
6.75%
BIC
1,560,000
1,560,000
3,120,000
Apr-14
BIC
1,440,000
1,440,000
2,880,000
Jul-14
GL Europe Luxembourg
3,388,000
-
3,388,000
Apr-14
6.75%
5,000,000
-
5,000,000
Apr-14
6.32%
10,000,000
-
10,000,000
Feb-13
Euribor 3M +
spread
Sep-16
Jan-16
Revenue for the season tickets, ticket and membership
fees until 2015/2016 season
Tax credits pledge, Club's real estate assets mortgage,
Mangala and Jackson players' registration.
Oct-14
Mangala and Jackson's player registration.
May-15
Advertising revenues
Dec-16
Tax credits pledge and Club's real estate assets
mortgage.
Sep-14
Helton's player registration.
Antecipated
Jan-15
Revenues from advertising sponsorship to receive from
Portugal Telecom from 2014/15 season.
Antecipated
Jan-15
Amount to receive from the play off UCL 14/15 access,
group's stage 14/15 and 14/15 market pool.
Antecipated
Feb-16
Antecipated
Jun-16
Antecipated
Jul-14
Antecipated
Jan-15
Amount receivable from PPTV - TV Broadcasting rights
Quarterly
Aug-14
Amount (partial) to receive f rom Zenit St. Petersbourg
regarding the disposal of Hulk player registation.
"Factoring"
Tw o equal installments in Jul-14
and Jan-15
3 installments on the dates of
receipt of the UEFA scheduled f or
Sep-14, Dec-14 and Jan-15
Euribor 6M +
spread
Euribor 6M +
spread
Unicer f rom 2014/15 and 2015/16 seasons.
Unicer f rom 2014/15 and 2015/16 seasons.
Discounted bill f rom Atletico Madrid - 3,5M€ untill July 31,
2014
Bil ls di scounted
BES (*)
Secured current accounts
BES (*)
99,977,500
39,112,500 139,090,000
(*) Currently designated as “Novo Banco”.
(**) Subsequent to June 30, 2014 the payment due dates of this loan were renegotiated, being this loan now repayable
in five annual instalments: three instalments of 3,000,000 Euro in September 2014, 2015 and 2016; and two instalments
of 4,000,000 Euro in September 2017 and 2018 (Note 36).
(***) Subsequent to June 30, 2014 the payment due dates of this loan were renegotiated, being this loan now repayable
in 3 instalments to occur in September 2014 in the amount of 3,000,000 Euro, in October 2014 in the amount of
2,000,000 Euro and in September 2015 in the amount of 25,000,000 Euro (Note 36).
The average annual rate of bank and bond loans as of 30 June 2014 is 7.31% (8.51% as of 30 June
2013).
19. OTHER CREDITORS
As of 30 June 2014 and 2013, the caption “Other creditors” is as follows:
Entity
Pearl Design
Doyen Sports Investments Ltd.
Doyen Sports Investments Ltd.
Goog for Sports Ltd.
Interests
30.06.2013
Current
Non-current
30.06.2014
Current
Non-current
2,125,000
2,352,941
2,647,059
1,500,000
-
-
2,125,000
2,352,941
2,647,059
-
8,625,000
-
-
7,125,000
1,402,940
-
-
544,894
10,027,940
-
-
7,669,894
___________________________________________________________________________________________
74
2013/2014
___________________________________________________________________________________________
In the financial year ended 30 June 2011, the Company entered into associated financial interests
contracts with third parties, in order to transfer part of the economic rights of two of the players
above mentioned: (i) 25% of Walter economic rights’ by 2,125,000 Euro to Pearl Design Holding,
Ltd.. Once that, according to the referred contracts, the significant risks and benefits regarding to
the detention of those rights were not fully transferred, those transactions were not recorded as
sales, and therefore, the part of the economic rights of that intangible assets was not
derecognised. The amounts received from those entities were recorded in the caption of the
statement of financial position “Other creditors”.
On 14 December 2011, the Company entered, with Doyen Sports Investments Limited, into two
associated financial interests’ contracts in order to transfer part of the economic rights of the
players Defour and Magala amounting 2,352,941 Euro and 2,647,059 Euro, respectively. Once
that, according to the referred contracts, the significant risks and benefits regarding to the
detention of those rights were not fully transferred, those transactions were not recorded as
sales, and therefore, the part of the economic rights of that intangible assets was not
derecognised.
On January 2, 2014, the Group ceded to Good Sports Limited the amount receivable from Chelsea
FC, in the amount of 1,500,000 Euro, related with the sale of the player’s registration rights of
Christian Atsu. This loan bears interest at 8% and the maturity date is August 25, 2014.
Thus, the percentages held of the players, referred to in Note 8, take in consideration the sharing
with those entities of the inherent results in future transactions of the players Walter, Defour and
Mangala.
20. TRADE PAYABLES
Non-current liabilities
The detail and maturity of non-current trade payables balances as of 30 June 2014 and 2013 is as
follows:
30.06.2014
Trade payables - non-current
Tangible and intangible assets' supliers:
Other tangible and intangible assets' supliers
Effect of discounting trade payables
987,333
38,523
12,841
-
-
-
(32,442)
(32,442)
-
-
-
-
30.06.2013
> 2 YEARS > 3 YEARS > 4 YEARS > 5 YEARS
987,333
51,364
1,006,255
Trade payables - non-current
> 1 YEAR
993,414
12,841
-
-
-
> 1 YEAR > 2 YEARS > 3 YEARS > 4 YEARS > 5 YEARS
4,000,000
89,501
4,000,000
38,358
38,357
12,786
-
-
(343,938)
(343,938)
-
-
-
-
3,745,563
3,694,420
38,357
12,786
-
-
___________________________________________________________________________________________
75
2013/2014
___________________________________________________________________________________________
The balance of the non-current trade payable account “Suppliers – transactions of players’
registrations” as at 30 June, 2014, is due to: (I) the acquisition of economic and sporting rights of
Lichonvski in the amount of 612,333 Euro; and (ii) the acquisition of economic and sporting rights
of Chidrera Ezeh in the amount of 375,000 Euro.
The balance of the non-current trade payable account “Suppliers – transactions of players’
registrations” as at 30 June, 2013, is due to: (i) sporting and economic rights of the player Herrera,
in the amount of 2,000,000 Euro; (ii) acquisition of 35% of the economic rights of the player James
Rodriguez, in the amount of 2,000,000 Euro.
Current liabilities
As of 30 June 2014 and 2013, the balances of current trade payables and their exigibility may be
detailed as follows:
30.06.2014
Trade payables - current account
Obligations under finance leases
+ 180 days
11,544,496
-
-
24,534,256
38,524
24,572,780
22,569,104
9,631
22,578,735
51,409
9,631
61,040
1,913,743
19,262
1,933,005
(270,740)
30.06.2013
Payable to
90 - 180 days
11,544,496
35,846,536
Trade payables - current account
Leasing
- 90 days
(156,623)
33,966,608
- 90 days
(45,292)
15,748
Payable to
90 - 180 days
(68,825)
1,864,180
+ 180 days
5,546,113
5,546,113
-
-
56,176,292
60,827
56,237,119
32,497,830
15,207
32,513,037
9,397,801
15,207
9,413,008
14,280,661
30,413
14,311,074
(106,095)
61,677,137
(61,376)
37,997,774
(17,749)
9,395,259
(26,970)
14,284,104
As of 30 June 2014 and 2013 the main balances included in the captions, current and non-current,
‘Fixed assets’ suppliers – Transactions of players’ registrations’ can be detailed as follows:
___________________________________________________________________________________________
76
2013/2014
___________________________________________________________________________________________
Entity
jun/14
Current
jun/13
Non-current
Current
Pencilhill
5,400,000
Onsoccer International, S.A.
2,500,000
Danubio Finanzierungsleistungen und Marketing GMBH
2,065,000
2,000,000
Promotora del Club Pachuca SA de CV
2,000,000
Universidade do Chile
1,224,667
Moreirense Futebol Clube, SAD
1,675,000
Delfino Pescara
1,110,800
MHD, S.A.
586,874
MS Entertainmnet Law-Melanie Schärrer
586,874
Soccer Invest Fund
550,000
DNN Lda.
500,000
Cluj
380,000
River Lane Youyh Club
Estoril - SAD
207,500
Gestifute, S.A.
134,000
Clube de Futebol America S.A. de C.V.
Standard de Liége S.A.
Club Jaguares de Chapas
Orel B.V.
Sporting Sociedade Desportiva Futebol, SAD
Play International B.V.
C.D. Nacional
Others
3,613,541
612,333
375,000
-
238,311
6,750,000
6,000,000
1,548,282
2,200,000
1,330,000
1,500,000
3,057,057
5,500,000
4,233,021
4,204,893
3,945,814
2,841,953
154,500
151,500
6,228,349
24,534,256
987,333
49,645,369
Non-current
2,000,000
2,000,000
4,000,000
On June 30, 2014, the balances payable to the entities mentioned above have resulted mainly
from the acquisition of economic rights, the proportional sale values of the registration player’s
held by third parties and intermediation service costs provided in acquisition and disposals of
players’ registrations regarding the athletes Iturbe, Fernando, Kayembe, James Rodriguez,
Herrera, Ghilas, Igor Lichnovski and Quintero.
21. OTHER CURRENT AND NON-CURRENT LIABILITIES
The captions ‘Other non-current liabilities’ and ‘Other current liabilities’ as of 30 June 2014 and
2013 can be detailed as follows:
30.06.2014
Other non-current liabilities
Accrued expenses:
Cost of transactions of players' registrations, not yet due
Deferred income:
Broadcasting rights advances/antecipated invoicing
- seasons 2015/16 to 2017/18 (Note 31)
Deferred revenue sponsorship - BMG Museum
30.06.2013
1,852,280
2,655,736
6,000,000
5,046,639
(136,297)
8,000,000
(449,704)
12,762,622
10,206,032
___________________________________________________________________________________________
77
2013/2014
___________________________________________________________________________________________
30.06.2014
Advances to clients
Other creditors
Accrued expenses:
Accrued payroll
Competition bonuses pending processing
Other accrued expenses
Deferred income:
- seasons 2014/15 (Note 31)
Sale of season tickets
Advertising
Other deferred income
30.06.2013
3,127,033
5,000,000
9,902,184
18,029,217
6,537,415
4,450,000
9,643,050
20,630,465
767,371
7,839,508
2,071,921
519,099
11,197,899
654,351
7,697,823
330,642
1,329,362
10,012,178
2,000,000
328,613
1,825,000
651,679
221,509
5,026,801
1,750,000
503,576
2,238,102
3,946,300
974,575
9,412,553
(434,242)
(426,044)
33,819,675
39,629,152
The caption ‘Other current/non-current liabilities – Cost of transactions of players' registrations,
not yet due’ includes commitments assumed in players registrations transactions supported by
the respective contracts and not yet invoiced as of the end of the reporting period.
As of 30 June 2014, includes, namely, amounts related to:
(a) intermediation costs of players in the amount of 5,583,452 Euro related, to among others,
with the sale of registration rights of the players Iturbe, Fernando and Otamendi;
(b) celebration and/or renewal of the labour contracts, namely signing-on fees and image rights
in the amount of 3,417,565 Euro related, among others, to the players Reyes and Diego
Herrera.
As of 30 June 2013, includes, namely, amounts related to:
(a) registration’s sale commission amounting 2,730,108 Euro related, among other to: economic
rights acquisition of Danilo , Herrera and Mangala and the sale of Guarín economic rights;
(b) solidarity mechanism, amounting 3,472,400 Euro, related, among others, to economic rights
sale of Falcao and James Rodriguez;
(c) celebration and/or renewal of the labour contracts, namely signing-on and loyalty fees,
amounting 3,857,740 Euro related, among others, to the players: Diego Reyes, Herrera and
Defour.
In the classification as non-current balance, which regards the signing-on fees, were considered
the agreed payment dates.
The item "Other payables" as of June 30, 2014, includes remunerations, bonuses and termination
compensations payable to players who have terms of payment in the short term (approximately
7,567,000 Euro as of June 30, 2014 and 5,800,000 Euro as of June 30, 2013). On June 30, 2013,
___________________________________________________________________________________________
78
2013/2014
___________________________________________________________________________________________
this caption also includes the amount of 600,000 Euro received from the Bank of Minas Gerais as
an advance under the signature of a partnership agreement concerning advertising and support
of the construction of the FCP Museum, inaugurated on 26 October 2013.
On June 30, 2014 and 2013, the caption "Competition bonuses pending processing" includes
amounts relating to matches participation premiums and amounts and bonuses attributed to
certain athletes in order to guarantee the minimum annual wage contracted in their respective
labour contract.
The caption "Deferred Revenue Sponsorship - BMG Museum" refers to the deferral of revenue
related to the agreement signed between the subsidiary PortoComercial and Banco de Minas
Gerais (“BMG”) as an advance under the signature of a partnership agreement concerning
advertising and support of the construction of the FC Porto Museum. This contract establishes the
sponsorship and naming of the Museum in the amount of 8,000,000 Euro until 2025. As
mentioned in Note 13, PortoComercial acquired, in October 2013, to Futebol Clube do Porto the
right to explore the Museum, having paid in advance 12,000,000 Euro, corresponding to the rents
of 8 years of the Museum exploration.
The maturity of the captions ‘Other non-current liabilities’ and ‘Other current liabilities’ as of 30
June 2014 and 2013 can be detailed as follows:
30.06.2014
Accrued expenses:
Deferred income:
- seasons 2015/16 to 2017/18 (Note 31)
> 3 years
> 4 years
> 5 years
1,120,352
453,464
278,464
-
-
6,000,000
2,000,000 2,000,000
2,000,000
-
-
651,679
(33,367)
651,679
(20,490)
651,679
-
2,439,923
-
3,689,592 3,071,776
2,909,653
651,679
2,439,923
5,046,639
(136,297)
Advances to clients
Other creditors
Accrued expenses:
Accrued payroll
> 2 years
1,852,280
12,762,622
Deferred income:
Advertising
> 1 Year
651,679
(82,439)
90-180
days
180-360
days
30.06.2014
< 90 days
3,127,033
5,000,000
9,902,184
18,029,217
3,127,033
9,902,184
13,029,217
-
5,000,000
5,000,000
767,371
7,839,508
2,071,921
519,099
11,197,899
6,887,175
2,071,921
519,099
9,478,195
255,790
612,333
868,123
511,581
340,000
851,581
2,000,000
328,613
1,825,000
651,679
221,509
5,026,801
500,000
500,000
82,153
82,153
912,500
912,500
162,919
162,290
221,509
1,879,081 1,656,943
1,000,000
164,307
326,470
1,490,777
(434,242)
(452,817)
33,819,675
(2,725)
(23,960)
23,933,677 2,522,341
7,318,397
___________________________________________________________________________________________
79
2013/2014
___________________________________________________________________________________________
30.06.2013
Accrued expenses:
Deferred income:
- seasons 2014/15 to 2017/18 (Note 31)
> 2 years
> 3 years
> 4 years
> 5 years
2,655,736
1,156,935
766,873
453,464
278,464
-
8,000,000
2,000,000 2,000,000
2,000,000
2,000,000
-
(449,704)
(195,907) (129,857)
(76,786)
(47,153)
-
10,206,032
2,961,028 2,637,016
2,376,678
2,231,311
-
Advances to clients
Other creditors
Accrued expenses:
Accrued payroll
Rendimentos a reconhecer:
Advertising
Actualização de responsabilidades com terceiros
> 1 Year
90-180
days
180-360
days
30.06.2013
< 90 days
6,537,415
4,450,000
9,643,050
20,630,465
6,537,415
4,450,000
9,643,050
20,630,465
-
-
654,351
7,697,823
330,642
1,329,362
10,012,178
7,269,428
330,642
1,329,362
8,929,432
218,117
43,750
261,867
436,234
384,645
820,879
1,750,000
503,576
2,238,102
3,946,300
974,575
9,412,553
437,500
437,500
125,894
125,894
1,119,051 1,119,051
1,973,150 1,973,150
974,575
4,630,170 3,655,595
875,000
251,788
1,126,788
(426,044)
(402,334)
39,629,152
(2,421)
(21,289)
33,787,733 3,915,041
1,926,378
22. PROVISIONS AND ACCUMULATED IMPAIRMENT LOSSES
The movement in provisions and accumulated impairment losses in the years ended 30 June 2014
and 2013 is as follows:
Captions
Accumulated impairment loss on investments (Note 9)
Accumulated impairment loss on account receivables (Note 11)
Accumulated impairment loss on inventories (Note 12)
Provisions
Captions
Accumulated impairment loss on investments (Note 9)
Accumulated impairment loss on account receivables (Note 11)
Accumulated impairment loss on inventories (Note 12)
Provisions
Opening
Balance
30.06.2013
Increase
1,705,267
5,042,712
302,696
1,924,649
1,532,169
322,016
74,597
-
8,975,324
1,928,782
Opening
Balance
30.06.2012
Increase
Utlisation
(78,184)
Decrease
Closing
Balance
30.06.2014
(1,514,094)
(2,035,399)
(408,289)
-
1,202,037
4,878,255
377,293
410,555
(1,592,278)
(2,443,688)
6,868,140
Utlisation
Decrease
Closing
Balance
30.06.2013
890.680
5.833.849
151.215
1.924.649
1.731.516
821.467
151.481
-
(916.929)
(57.832)
-
(1.554.772)
-
1.705.267
5.042.712
302.696
1.924.649
8.800.393
2.704.464
(974.761)
(1.554.772)
8.975.324
___________________________________________________________________________________________
80
2013/2014
___________________________________________________________________________________________
Provisions
Tax litigations
As of June 30, 2013 the Group presented provisions in the amount of 1,514,094 Euro to cover any
contingencies that might arise from an unfavourable outcome of tax litigations, which had been
challenged through complaints/administrative appeals or judicial challenges by the Group, by the
fact that the Board of Directors and theirs legal and tax advisors consider that the reasons given
by the Tax Administration on the matters referred, were not in accordance with Portuguese law.
However, under the Extraordinary Regime for the Settlement of Debts to Social Security and to
Tax Authority ("RERD") granted by the Ministry of Finance to the voluntary payments made by
taxpayers until December 31, 2013, regarding taxes due, the FC Porto SAD paid the amount of
4,227,685 Euro related to tax processes, using the provision recorded for this purpose in the
amount of 1,514,094 Euro, recognizing the remaining difference as an expense for the year Note
15). Notwithstanding the settlement of this amount, the Company maintains the complaints and
judicial claims, having the Company contingent assets related with them as detailed in Note 35.
Currently, the Company does not have any tax assessments settlements’ pending from
regularization, by which no additional provisions were not registered in order to face tax
contingencies.
Other litigations
During the year ended 30 June 2008 a judicial process was brought by a third party against the
subsidiary PortoEstádio; in May 2009 a sentence was issued by the the Judicial Court’s (7ª Vara
Cível do Tribunal Judicial do Porto) condemning PortoEstádio to pay a compensation of 404,241
Euro, plus default interests. Despite PortoEstádio presented an appeal against this verdict, as of
30 June 2014 the caption ‘Provisions’ consider the amount of, approximately, 410.000 Euro to
cope with the risk of an unfavourable outcome of this process.
Bank guarantees
As of June 30, 2014, the Group had the following bank guarantees:
(a) PortoComercial: bank guarantees in the amount of 137,511 Euro in favour of malls store’s
leaseholders;
(b) PortoEstádio: bank guarantee of 410,555 Euro regarding the judicial process described above;
(c) PortoSeguro: bank guarantees of 15,000 Euro in favour of the “Instituto de Seguros de
Portugal” – “ISP”, the Portuguese Insurance Institute;
(d) Dragon Tour: bank guarantee of 75,000 Euro in favour of IATA - International Air Transport
Association.
As of June 30, 2013, FC Porto, SAD had requested the issuance of bank guarantees in favour of
the Tax Authorities in the amount of 5,445,230 Euro, related with the additional tax settlements
for the years ended June 30, 2004, 2008 and 2009. With the settlement of the amounts claimed
by the Tax Authorities associated with these inspections in December 2013, under the RERD, these
guarantees were extinguished.
___________________________________________________________________________________________
81
2013/2014
___________________________________________________________________________________________
Other responsibilities
The FC Porto, SAD endorsed a guarantee towards FCP Serviços Partilhados, S.A. in the amount of
503,574 Euro, under the financial leasing of computer equipment purchased by this entity of the
Futebol Clube do Porto Group.
Impairment losses
During the financial year ended 30 June 2013, the Company reversed impairment losses on
accounts receivables in the amount of 1,554,772 Euro, from which 1,142,229 Euro are referring
to accounts receivable of FCPBasquetebol, SAD which the respective impairment losses had been
recorded in the year ended as at 30 June 2012, since the accounts receivable proved to be
uncollectible due to the decision of liquidation and dissolution of that company at the beginning
of the season of 2012/13. However given that, by agreement with the FC Porto, the club took their
loss in receivables towards this company, impairment losses were reversed counterpart of an
increase in accounts receivable from Futebol Clube do Porto.
23. PENSION LIABILITIES
The Group has committed to grant to certain employees cash contributions as retirement
complement plans. These benefits are set out in the Collective Agreement between FC Porto and
CESP – “Sindicato dos Trabalhadores do Comércio, Escritórios e Serviços de Portugal e Outros”
(Trade Union for workers of Commerce, Offices and Services of Portugal).
The most recent actuarial valuation of the plan and the present value of defined benefits
obligation was made in July 18, 2014 by Mercer (Portugal) Lda.. The present value of the defined
benefit obligation and the cost of the current services and past services were measured using
Projected Unit Credit method.
The main actuarial assumptions followed in the actuarial evaluation were as follows:
30.06.2014
Retirement normal age
Mortality table
Disability table
Discount rate
Inflation rate
Salaries increase rate
Pension increase rate
66 years
TV 88/90
EVK 80 at 50%
2.75%
2.00%
3.00%
2.00%
During the year ended as of June 30, 2014 the Group recorded, for the first time the
responsibilities associated with this pension plan under the caption "Pension liabilities " with the
respective counterpart the Income Statement in the amount of 448,818 Euro (Note 26).
The major risks for which the pension plan may be exposed are as follow:
• Behaviour of demographic variables;
• Changes to occur in the Social Security system;
• Pension indexation.
___________________________________________________________________________________________
82
2013/2014
___________________________________________________________________________________________
A sensitivity analysis was performed in order to measure the impact on pension liabilities caused by
changes in the discount rate (increase of 25 basis points) and a negative impact of approximately
17,000 Euro was calculated.
24. SERVICES RENDERED
Services rendered for the years ended 30 June 2013 and 2012 are made up as follow:
30.06.2014
Sporting income
European competitions participating bonus
Ticketing income
Season tickets
Membership contributions
Other sporting income
Advertising
Broadcasting rights
Corporate Hospitality (Note 33)
Others
30.06.2013
9,551,956
2,493,309
2,835,578
899,123
2,400,405
18,180,371
20,390,070
2,311,731
3,237,993
971,003
1,135,521
28,046,318
13,594,159
15,928,072
14,352,830
4,922,761
66,978,193
13,067,314
13,185,000
15,161,233
5,090,917
74,550,782
The caption "European competitions participating bonus" includes participation and performance
bonuses regarding the Champions League groups stage and the Europa League qualifiers, where
FC Porto SAD participated in season 2013/14 (3,285,956 Euro); prizes related to Market Pool
(4,166,000 Euro) as well as the guaranteed amount for the access for the play-off of the
Champions League season 2014/15 (2,100,000 Euro). The reduction in this caption is justified by
the fact that, in the year ended June 30, 2013, the Company has recognized the award for
participation in the Champions League 2013/14 group’s stage, in the amount of 8,600,000 Euro,
which didn’t occurred in the 2013/14 season regarding the participation in the Champions League
2014/15 group’s stage because the Company didn´t earned the right to access this stage in the
present season but only for the following season (Note 36).
The increase in the caption "Ticket income" is related to a larger number of matches in the
European competitions (including the Europa League). The decrease in the caption "Season
tickets" is related to a lower level of commercialization of season tickets for the season 2013/14.
The caption "Membership contributions” correspond to the transfer of 25% of the total
contributions charged by FC Porto.
The caption 'Corporate Hospitality' includes: (i) the gross amount of 5,060,155 Euro (777,948 Euro
net of the cost of 4,282,207 Euro - Note 25; 1,191,145 Euro on June 30, 2013) related to the
income of "Lugares Euroantas" (surplus calculated as described in Note 34), (ii) the amount of
1,268,175 Euro (1,272,685 Euro on June 30, 2013) related to the commission over the corporate
segment charged to Euroantas by PortoComercial within the business contract terms between
the two entities; and (iii) the amount of 7,979,500 Euro related by the commercialization of box
seats (commercialization by the subsidiary PortoComercial and charged invoiced by Euroantas Note 25).
___________________________________________________________________________________________
83
2013/2014
___________________________________________________________________________________________
25. EXTERNAL SUPPLIES AND SERVICES
As of 30 June 2014 and 2013, the main balances included in this caption were as follows:
30.06.2014
Specialised services
Corporate Hospitality (Nota 34)
Subcontracts
Rentals
Advertising
Security
Organization costs
Insurance
Fees
Sports equipment
Repair and maintenance
Cleaning up services
Representation expenses
Fuels
Communication
Electricity
Other costs
30.06.2013
10,865,542
12,261,707
4,902,667
3,817,848
1,672,386
1,370,372
1,295,064
1,016,266
787,335
617,127
536,159
515,000
488,439
427,793
392,237
370,819
711,255
6,943,023
12,697,403
3,717,198
3,668,955
1,691,891
1,143,791
975,687
1,206,130
871,723
783,344
584,601
439,658
458,668
400,387
403,787
394,635
1,117,828
42,048,016
37,498,709
The caption ‘Corporate Hospitality” includes: (i) the amount of 4,282,207 Euro – Note 23, related
to “Lugares Euroantas” (surplus calculated as described in Note 33), and (ii) the amount of
7,979,500 Euro related to the use of boxes by Euroantas to commercialization by the subsidiary
PortoComercial – Note 24.
The caption ‘Specialised services’ includes several types of costs associated with the Group’s
activity, namely: (i) expenses with market research services, (ii) costs with legal advisory services,
(iii) costs with advisory services, namely theones provided by FC Porto – Serviços Partilhados S.A.
(Note 31); (iv) costs relating to the cession of the exploitation and management rights of the TV
channel "Porto Canal" and to the alterations of the referred TV Channel grid, as agreed with the
company “Avenida dos Aliados de Comunicações, SA.”. The reason for the increased of this
caption relates to the last refered component, by the integration of company FC Porto Media, S.A.
in the consolidation perimeter for the first time this year (an impact of approximately 3 million
Euro), as well as increased spending on scouting services.
In the caption ‘Subcontracts’ are included costs incurred in connection with the protocol signed
between the Group and Futebol Clube do Porto, mainly related with the use of several facilities,
as well as the utilization of the training centre by the senior team and the junior teams, as well
the costs of travel and accommodation incurred by the subsidiary Dragon Tour.
The caption "Organization costs" considers various costs associated with matches’ organization.
The increase of this caption, of the captions "Subcontracts" and " Security" is justified by the
greater number main team matches’, both official (in Europa League) and pre-season
tournaments, held outside of Portugal.
___________________________________________________________________________________________
84
2013/2014
___________________________________________________________________________________________
26. PAYROLL EXPENSES
The balances related to payroll expenses for the years ended 30 June 2014 and 2013 of the
Company and subsidiaries are detailed as follows:
Governing bodies
Players/Coaches
Technical and administrative staff
Post-Employment Benefits
Indemnities
Charges on salaries
Insurance
Other costs
30.06.2014
30.06.2013
2,853,989
34,362,160
5,303,599
448,818
545,718
3,252,683
1,571,613
546,716
2,564,179
40,662,364
5,106,072
3,673,280
1,537,705
521,654
48,885,294
54,065,254
The decrease in the caption "Players / Coaches" and "Charges on salaries" for the year ended June
30, 2014 is justified mainly by the non-attribution of National Champion and the Champions
League’ Round of 16 prizes, to the professional football team, contrary to what happened in the
year ended June 30, 2013.
Net payroll expenses for the year ended June 30, 2014, of players on temporary loan to other
clubs, amounted to, approximately 3,500,000 Euro (2,100,000 Euro on June 30, 2013).
The remuneration of the members of the Board of Directors of FC Porto, SAD and its subsidiaries
for the years ended June 30, 2014 and 2013 is as follows:
Fixed Remuneration
30.06.2014
30.06.2013
2,853,989
2,564,179
2,853,989
2,564,179
The detail of the remunerations for each Board of Directors’ member and remaining governing
bodies is disclosed in the Corporate Governance Report.
As of 30 June 2014 and 2013, the number of people working for the Group is as follows:
Governing bodies
Administrative staff
Technical staff
Museum
Vendors (stores)
Football players
30.06.2014
30.06.2013
8
159
31
7
33
58
7
120
31
33
52
296
243
___________________________________________________________________________________________
85
2013/2014
___________________________________________________________________________________________
27. RESULTS OF TRANSACTIONS WITH PLAYERS’ REGISTRATIONS
The results of transactions with players’ registrations in the years ended 30 June 2014 and 2013
can be detailed follows:
30.06.2014
Amortisation of players' sporting registration rights (Note 8)
Impairment losses of players' sporting registration rights (Note 8)
Write offs of player's registration rights
Income/(expenses) related with transactions of players' registrations
Costs relating to players on loan
Other costs relating to players
Gains from the sales of players' registrations (Note 8)
Income relating to players on loan
Other income relating to players
30.06.2013
26,379,179
563,333
188,192
27,130,704
26,225,716
300,842
26,526,558
(145,000)
(1,660,800)
(1,805,800)
(727,294)
(727,294)
22,397,504
1,483,937
1,831,215
25,712,656
74,016,304
2,095,000
1,061,199
77,172,503
23,906,857
76,445,209
(3,223,847)
49,918,651
Impairment losses of players’ registrations rights consider the carrying amount of players’
registrations as of 30 June 2014 whose employment contracts were terminated by the Company
until the approval date of these financial statements, as well as the estimated impairment loss of
the players’ registrations considering the players’ sport situation as of the approval date of the
financial statements. The balance of this caption as of 30 June 2014 corresponds essentially to
players Izmailov and Stefanovic. On June 30, 2013 the balance of this caption corresponds mainly
to the players Emidio Rafael, Bracali, Ukra and Sereno.
On June 30, 2014, the caption "Costs relating to players on loan" refers to expenses incurred under
the loan of the player Pavlovsky. The caption "Other costs relating to players” essentially includes
the effect of the adjustment in the calculation of the gain from the sale of the player James
Rodriguez with Orel BV (438,000 Euro) and the compensation paid to Paços Ferreira by the hiring
of the coach Paulo Fonseca (450,000 Euro).
The amounts included in the captions "Gains from the sales of players’ registrations” and "Losses
from the sales of players’ registrations " are presented net of the carrying amount of the players’
registrations, intermediation service costs incurred with that sales, and liabilities under the
“solidarity mechanism” (if and when applicable), the discount effect of accounts receivable and
payable related with those transactions and the cost of eventual compensation payments (Note
8). On June 30, 2014, the caption "Gains from the sales of players’ registrations" mainly refers to
sale of players’ registration rights of: Otamendi (7,974,000 Euro), Fernando (5,298,000 Euro),
Iturbe (4,736,000 Euro), Christian Atsu (1,991,000 Euro) and André Castro (1,654,000 Euro),
among others. On June 30, 2013, the most expressive amounts refer to sale of players’ registration
rights of Hulk, Joao Moutinho, James Rodriguez and Álvaro Pereira.
___________________________________________________________________________________________
86
2013/2014
___________________________________________________________________________________________
The caption "Other income relating to players” includes training compensations and solidarity
mechanism, whereas in the year June 30, 2014 the increase in this caption was due to the amount
received from Sport Lisboa e Benfica, SAD of 913,655 Euro, regarding training rights of the player
Feher (Note 35).
28. OTHER INCOME
As of June 30, 2014, the caption "Other income" included an amount of, approximately, 550,000
Euro to the FIFA compensation for the FCP, SAD players’ participation in the World Cup 2014, and
419,510 Euro (770,148 Euro on June 30, 2013) regarding the refund of withholding taxes of
personnel income tax from athletes of FCP, SAD following the change of theirs status from
resident to non-residents.
29. FINANCIAL RESULTS
Financial expenses and income for the years ended 30 June 2014 and 2013 are made up as follows:
30.06.2014
Financial expenses:
Interest
Discount effect of accounts payable
Other financial expenses
Financial income:
Interest
Discount effect of accounts receivable
Net financial expenses
9,824,932
1,457,890
1,451,644
12,734,466
1,045,448
1,519,494
2,564,942
(10,169,524)
30.06.2013
10,165,873
1,545,787
1,181,591
12,893,251
1,073,517
2,697,790
3,771,307
(9,121,944)
The balance of the captions ‘Discount effect of accounts receivable’ and ‘Discount effect of
accounts payable’ relate to interest resulting from the temporal difference between the
transaction date of sale / purchase of the registration rights of several sports players and the dates
of receipt / payment contractually agreed.
In the year ended 30 June 2014 the income interest relate, mainly, to interest payable by FC Porto
in accordance with the signed debt settlement agreement (Note 11).
30. GAINS AND LOSSES IN INVESTMENTS
The detail of caption “Gains and losses in investments” for the years ended 30 June 2014 and 2013
is as follows:
Impairment losses - players' economic rights (Note 9)
Impairment losses - Goodwill (Note 10)
Capital gain arising on the disposal of economic rights
30.06.2014
30.06.2013
(1,532,169)
-
(1,731,516)
(221,000)
204,600
(1,532,169)
(1,747,916)
___________________________________________________________________________________________
87
2013/2014
___________________________________________________________________________________________
31. RELATED PARTIES
The balances and transactions between the Company and its subsidiaries, which are related
parties, were eliminated in consolidation and therefore are not mentioned in this note. The main
balances with related entities, identified below, as of 30 June 2014 and 2013 and the main
transactions performed with these entities during the year ended as of that date are as follows:
Balances
Futebol Clube do Porto (Note 11)
Euroantas (Notes 24, 25 and 34)
F.C.P. Serviços Partilhados
FCP Media
Fundação Porto-Gaia
PPTV/Olivedesportos
Investiantas
Sportinveste
Balances
Futebol Clube do Porto (Note 11)
F.C.P. Serviços Partilhados
FCP Media
PPTV/Olivedesportos
Investiantas
Sportinveste
Accounts receivable
current and non-current
16,980,047
7,102,589
650,139
10,086
5,000,000
5,600
50,896
29,799,356
Accounts receivable
13,258,397
5,715,804
620,484
1,508,066
4,450,000
102,406
25,655,157
30.06.2014
Accounts payable
Other current and
non-current assets
48,076
4,048,748
641,265
11,600
4,749,689
11,268,845
14,963,937
289,157
26,521,938
30.06.2013
Accounts payable
Other current and
non-current assets
2,306
2,709,177
775,607
61,869
7,037
3,555,996
6,547,669
15,074,195
335,387
21,957,251
Other current and
non-current liabilities
29,523
13,000,000
13,029,523
Other current and
non-current liabilities
44,748
393,981
14,200,000
6,240
14,644,969
30.06.2014
Transactions
FCP Serviços Partilhados
FCP Basket SAD
FCP Media
PPTV/Olivedesportos
Sportinveste
Sales and
services
rendered
2,381,320
6,650,672
109,270
15,303,867
90,072
24,535,201
Purchases and
External supplies
and services
Income
interests
6,700,742
11,633,841
4,900,514
36,145
46,500
23,317,742
Other
expenses
797,629
797,629
976
(751)
225
30.06.2013
Transactions
FCP Serviços Partilhados
FCP Basket SAD
FCP Media
PPTV/Olivedesportos
Sportinveste
Sales and
services
rendered
2,471,793
7,324,041
396,918
1,125
57,555
14,003,951
67,199
24,322,582
Purchases and
External supplies
and services
4,241,828
13,046,586
4,621,870
237,777
36,145
98,674
22,282,880
Income
interests
Other
expenses
843,722
843,722
37,545
350
5,711
891
16,713
61,210
Futebol Clube do Porto is the main shareholder of FC Porto, SAD (Note 16), and Euroantas is
99.99% owned by this entity. Additionally, is presented above information of Group balances and
transactions with the entities Sportinveste - Multimédia, S.A. (‘Sportinveste’) and
___________________________________________________________________________________________
88
2013/2014
___________________________________________________________________________________________
PPTV/Olivedesportos - Publicidade Televisão e Media, S.A. (‘Olivedesportos’), as the Chairman of
the Board of Directors of these entities is a referral shareholder of FC Porto, SAD.
As of 30 June 2014 and 2013, the transactions with the entity PPTV/Olivedesportos recorded in
the caption “Sales and services rendered” are justified by the cession contract, in exclusivity, of
the broadcasting rights relating to the FCP – Futebol, SAD main team games in ‘Estádio do Dragão’
for the Professional Football I League, as well as the static and virtual advertising commercial
exploration relating to those games, signed between the parties. On the other hand, the balance
recorded on the captions ‘Other current/non-current liabilities’ as of 30 June 2014 corresponds,
essentially, to the advance received by the Company form the entity above relating to the
mentioned rights applicable to the seasons 2014/15, as well as anticipated invoicing to the same
entity on televising rights for the seasons 2015/16 to 2017/18 (Note 21).
32. EARNINGS PER SHARE
Earnings per share were calculated considering the following amounts:
30.06.2014
30.06.2013
Earnings
Net profit/(loss) considered for the computation of basic
earnings per share
Effect of potencial shares
Net profit/(loss) considered for computation of diluted earnings
per share
(40,701,114)
20,355,997
-
-
(40,701,114)
20,355,997
15,000,000
15,000,000
-
-
15,000,000
15,000,000
Num ber of shares
Weighted number of shares used to compute the basic earnings
per share
Effect of potencial shares
Weighted number of shares used to compute the diluted earnings
per share
Earning per share (basic and diluted)
(2.71)
1.36
33. SEGMENT INFORMATION
Operationally, the Group is organised in two major segments:
Segment A:
activity related to the participation in professional football competitions, and the
promotion and organisation of sporting events represented by FCP SAD
Segment B:
activity relating to the sale of image rights, sponsorship, merchandising and
product licensing represented by PortoComercial
Other services: includes the activities of the subsidiaries PortoMultimedia, PortoEstádio
,PortoSeguro, FCP Media and Dragon Tour.
___________________________________________________________________________________________
89
2013/2014
___________________________________________________________________________________________
Operational income, indicating transactions with other segments and those resulting from
transactions with third parties, may be presented as follows:
30.06.2014
Segm . B
Other
services
Segm . A
Operational income excluding income related w ith transactions of
players' registrations
Resulting f rom operations w ith external clients
Resulting f rom operations w ith other segments
48,523,451
267,614
18,368,234
827,816
5,721,145
5,394,219
72,612,830
6,489,649
30.06.2013
Segm . B
Other
services
Segm . A
Operational income excluding income related w ith transactions of
players' registrations
Resulting from operations w ith external clients
Resulting from operations w ith other segments
Total
57,640,978
278,016
17,679,770
781,417
Total
3,120,607
4,992,970
78,441,355
6,052,403
The amounts related to operational profit, operational cash-flow and cash-flow, by segment, are
as follows:
Segm . A
Operational profit / (loss)
Amortisation and depreciation excluding amortisation of players'
registrations
Operational cash-flow - EBITDA (a)
Financial expenses
Financial income
Income tax
Cash-flow (b)
Segm . B
30.06.2014
Other
services
Intra-grup
Total
(24,090,881)
(1,434,037)
(261,381)
-
(25,786,299)
342,685
71,009
145,645
-
559,339
(296,686)
27,130,704
3,085,822
210,563
(1,152,465)
(150)
(115,886)
-
(86,273)
27,130,704
1,817,471
(1,532,169)
(12,396,891)
2,637,911
(3,012,708)
(11,218,035)
(626,365)
215,850
(38,868)
(1,601,848)
(236)
207
(168,350)
(284,265)
289,026
(289,026)
(1,532,169)
(12,734,466)
2,564,942
(3,219,926)
(13,104,148)
-
(a) - Earnings before taxes, financial results, depreciation and amortisation, provisions and impairment losses
(b) - Profit plus depreciation and amortisation, provisions and impairment losses
Se gm . A
Operational profit / (los s)
Amortisation and depreciation excluding amortisation of players'
registrations
Operational cash-flow - EBITDA (a)
Financial expenses
Financial income
Income tax
Cash-flow (b)
Segm . B
30.06.2013
Other
services
Intra-grup
Total
30,585,378
900,737
288,700
-
31,774,815
424,207
83,863
208,418
-
716,488
(55,057)
26,526,558
57,481,086
(123,513)
861,087
(554,734)
(57,616)
-
(733,304)
26,526,558
58,284,557
(1,747,916)
(12,382,455)
3,953,674
(376,177)
46,928,212
(435,420)
217,255
(141,868)
501,054
(75,376)
378
(57,015)
(189,629)
(400,000)
(1,747,916)
(12,893,251)
3,771,307
(575,060)
46,839,637
(400,000)
(a) - Earnings before taxes, financial results, depreciation and amortisation, provisions and impairment losses
(b) - Profit plus depreciation and amortisation, provisions and impairment losses
Data on total assets and total liabilities, as well as on the investment made in the year in tangible
and intangible assets, including players’ registrations, can be presented, by segment, as follows:
___________________________________________________________________________________________
90
2013/2014
___________________________________________________________________________________________
Segm . A
Total assets
Total liabilities
Investment made in the current year (c)
Total assets
Total liabilities
Investment made in the current year (c)
30.06.2014
Other
services
183,935,179
212,447,217
23,753,881
27,213,322
7,377,310
6,118,896
Elim inations
and
adjustm ents
(14,670,438)
(12,316,163)
18,834,334
800
-
-
Segm . A
Segm . B
Segm . B
30.06.2013
Other
services
215,068,141
205,185,442
12,914,230
14,490,251
3,745,650
3,171,027
Elim inations
and
adjustm ents
(3,875,446)
(2,621,500)
46,520,554
151,767
218,551
-
Total
200,395,932
233,463,272
18,835,134
Total
227,852,575
220,225,220
46,890,872
As FCP Group is currently developing its activity exclusively in the internal market, geographical
segments are not reported.
34. ‘ESTÁDIO DO DRAGÃO’
On 7 July 2003 a Cooperation Agreement was signed between PortoEstádio, Euroantas, Futebol
Clube do Porto and Futebol Clube do Porto – Futebol, S.A.D. relating to the construction,
financing, operation and utilisation of ‘Estádio do Dragão’ (‘the Stadium’), which consists of an
operating lease contract.
Under this agreement, Euroantas, the present owner of the Stadium, assigned to FCP, SAD the
exploitation of certain activities from the Sporting Area of the Stadium for a period of 30 years, in
return of an annual global charge, which approximates an “linear rent” over the 30 years period,
supported by FCPorto, SAD through two components:
i) An amount equal to the debt service borne by Euroantas during the first 15 years on the
Loan Contract entered into for the construction of the Stadium and, in the last 15 years, a
lower amount indexed to the debt service for the last year (2018) on the Loan Contract;
and
ii) The amount of 14,963,937 Euro, settled in the year ended 30 June 2003 and recorded as
‘Other non-current assets (Note 13), as a remuneration for the amount of the falling due
rents during the 15 year period, determined from 2018. This amount will be recognized as
a linear cost over the period of 15 years from 2018.
In accordance with the agreement, FCPorto, SAD also retains the right to receive from Euroantas,
any excess, determined annually, of the income, net of the inherent operating expenses,
commercialisation of Boxes and Business Seats of ‘Estádio do Dragão’ (‘Lugares Euroantas’) over
the amount of the ‘rent’ mentioned above.
Starting on 2012/13 season, following the change in the accounting method, these two portions
started to be invoiced separately from FCPorto SAD to Euroantas and from Euroantas to FCPorto,
SAD by the gross amount.
Under such terms, the net excess for the year ended 30 June 2014 amounted to 777,948 Euro
(Services rendered – 5,060,155 Euro – Note 24; External services and supplies – 4,282,207 Euro –
___________________________________________________________________________________________
91
2013/2014
___________________________________________________________________________________________
Note 25). Regarding the year ended as of 30 June 2013, the net excess amounted to 1,191,145
Euro (Note 24).
35. CONTINGENT ASSETS AND LIABILITIES
Contingent liabilities
i)
Pepe- Marítimo da Madeira-Futebol SAD
On 14 October 2010, Marítimo da Madeira – Futebol, SAD (“Marítimo”) brought a declarative
action against FCPorto, SAD in the Professional Football Portuguese League claiming a rectification
in the amount due regarding the sale of the Pepe’s registration to Real Madrid in the amount of,
approximately, 840,000 Euro, which includes late payment interests. On 14 September, 2012, the
Arbitral Comission of LPFP decided as unfounded all the claims from Marítimo, acquitting FCP,
SAD. Subsequently, on 17 October, 2012, Marítimo presented appealed to decision to the plenary
of LPFP. In December 2013 the request for the annulment of the decision of the Plenary of the
LPFP Arbitral Commission initiated by Maritime Football SAD within the Porto Civil Courts of Porto
was denied, and from this decision has brought an appeal to the Court of Appeal of Porto, by
Maritimo SAD being this process at the moment yet to be processed.
ii) Kléber- Marítimo da Madeira-Futebol SAD
On 18 October 2011, Marítimo da Madeira – Futebol, SAD (“Marítimo”) brought a declarative
action against FCPorto, SAD in the Professional Football Portuguese League claiming a sum by way
of "compensation for promotion or appreciation" of the player Kléber Laube Pinheiro, having
been rejected. Subsequently, the decision was annulled by the civil courts of Porto at the request
of Marítimo and the appeal of FC Porto, SAD, from this annulment decision was denied. The Board
of Directors, as well as its’ legal consultants, consider that the grounds presented by Marítimo is
not correct; therefore no impacts over the consolidated financial statements are estimated to
occur arising from the outcome of this action.
iii) João Moutinho- Sporting
Was brought by Sporting Clube de Portugal, SAD, within the LPFP Arbitral Commission, a
declarative judgment action concerning the definitive cession of the palyers’ registration rights
relating to the athlete João Filipe Iria Santos Moutinho, contract under which it was attributed to
Sporting SAD the right to receive 25% of the capital gain recorded in a future transfer of the player
to a third club. On September 17, 2014 the LPFP Arbitral Commission notified FCP, SAD from the
decision concerning this process in which the Company has condemned to the payment, to
Sporting Clube de Portugal, SAD, of the amount of 658,047 Euro plus interest. The Board of
Directors of the Company and its legal consultants, understands that the grounds presented by
Sporting are not correct, so it appealed from the decision, not estimating to occur, from the
outcome of this action, any material impacts over the consolidated financial statements.
iv) Feher- Sport Lisboa e Benfica, SAD ( SLB,SAD)
Following the enforcement of the decision from the LPFP Arbitral Commission, FCP SAD, SAD
received from the SLB, in February 2014, the amount of 913,655 Euro regarding a lawsuit brought
___________________________________________________________________________________________
92
2013/2014
___________________________________________________________________________________________
by FCP, SAD against SLB, SAD in 2002, arising from the hiring by SLB of the player Miklos Feher;
this amount was recognized as an income for the year ended 30 June 2014 (Note 27). On June 19,
2014 a decision from the Court of Appeal of Porto was delivered in which denied the appeal
presented by SLB, SAD regarding this process, confirming the decision of the LPFP Arbitral
Commission. On September 8, 2014, the SLB, SAD filed an appeal in the Supreme Court, being the
deadline for submission of counter-allegations on course.
The Board of Directors of the Company and its legal consultants, understands that the grounds
considered by the clubs in the above processes are not correct, by which it was presented
contestation, and it’s not estimated that from the outcome of these processes arise in any
material impact on the consolidated financial statements.
Contingent assets
i)
Tax litigations
As mentioned in Note 22, the Company does not have any tax assessments settlements’ pending
from regularization.
However, this year and in prior years, the Company made payments for additional tax
assessments, recording these payments as expenses in the period in which these payments
occurred. However, the Company maintains the complaints and judicial claims, calling for the
return of such amounts.
In this year, FC Porto SAD paid, in December 2013, 4,227,685 Euro, using the provision of
1,514,094 Euro (Note 22) and recording the differential as an expense for the year in the amount
of 2,713,591 Euro (Note 15).
Thus there are the following contingent tax assets in the June 30, 2014:
Tax
Nature
IRC 2003
IVA 2003
IRC 2005
IRC 2007
IRC e IVA 2008
IRC 2009
IRC e IRS 2010
Additional tax settlement
Amount paid in Amount paid in
prior years
13/14
148,641
626,650
117,484
53,232
316,366
1,262,373
2,007,275
171,369
298,991
770,500
979,550
4,227,685
Contingent
Asset
30.06.2014
2,155,916
171,369
626,650
416,475
823,732
979,550
316,366
5,490,058
36. SUBSEQUENT EVENTS
The following events took place after the date of the financial statements and, by its relevance,
are presented as follows:
___________________________________________________________________________________________
93
2013/2014
___________________________________________________________________________________________
i)
Players’ registration acquisitions:
a. Acquisition of the registration rights for 5 seasons and 60% of the economic rights of
the player Adrian Lopez from Club Atlético Madrid for 11,000,000 Euro;
b. Acquisition of the registration rights for 5 seasons and 100% of the economic rights
of the player Brahimi to Granada Club de Fútbol for 6,500,000 Euro; and disposal,
under the economic regime association, of 80% of the economic rights of the player
for the amount of 5,000,000 Euro, to Doyen Sports Investments Limited, with an
option to repurchase the economic rights;
c. Acquisition of the registration rights for 4 seasons and 30% of the economic rights of
the player Vincent Aboubakar to FC Lorient for 3,000,000 Euro;
d. Acquisition of the registration rights for 4 seasons and 100% of the economic rights
of the player Martins Indi to Feyenord by 7,700,000 Euro;
ii)
Players’ registration sales:
a. Transfer, on a permanent basis, of the player’s registration of the professional
football player Steven Defour in the amount of 6,000,000 Euro. This agreement
forecasts the payment of variable compensation, so the total amount receivable may
reach 6,500,000 Euro.
b. Transfer, on a permanent basis, of the player’s registration, and 56.67% of the
economic rights held of the professional football player Eliakim Mangala in the
amount of 30,500,000 Euro.
iii)
Players’ Contract Renewals
Extension for one more year, until June 30, 2017, of the labour contractual agreement
between the Company and Jackson Martinez Valencia. The amount of the termination
clause was fixed in 35,000,000 Euro. Additionally, a 5% stake of the net value from a future
transfer of the registration rights of the athlete was granted to his agent - Luis Henrique
Ferreira Pompeo - as compensation for the services rendered in negotiations with the
player.
iv)
Loan of Players
The FC Porto SAD secured the registration rights of the player Cristian Tello Herrera from
Futbol Club Barcelona for two sporting seasons, until June 30, 2016 and Carlos Henrique
Casimiro from Real Madrid Club de Fútbol until June 30, 2015. The contracts include the
call option right of those rights and the totality of their economic rights.
v)
Capital Increase
On 2 October 2014 was held a General Shareholders’ Meeting, which included the
resolution of the increase in share capital of the Company in the amount of 37,500,000
___________________________________________________________________________________________
94
2013/2014
___________________________________________________________________________________________
Euro, to be realized by contributions in cash through private subscription by Futebol Clube
do Porto of 7,500,000 preferred shares without voting rights, which aim to reinforce the
shareholder’s equity of FCP, SAD and to fulfil the Financial Fair Play requirements
established by UEFA.
vi)
Acquisition of Euroantas shares
Within the General Shareholder’s Meeting referred in the previous paragraph, it was
approved the acquisition, by the Company to Futebol Clube do Porto, of shares
representing up to 50% of the share capital of the company Euroantas, a company whose
main asset is the Dragao Stadium, having been presented an evaluation report of the
company, from an independent auditor, fixing its value at 110,120, 750 Euro.
vii)
Acquisition of shares and launch of a takeover bid
As a result of the acquisition by FC Porto, on 2 October 2014, of 2,818,185 ordinary shares
of Futebol Clube do Porto, SAD, at the price of 0.65 Euro per share to SOMAGUE
Imobiliária, SA and to Somague - Engenharia SA (corresponding to 18.79% of the share
capital and voting rights of the Company), now is attributed to FC Porto a total of
9,078,035 shares, which represents 60.52% of the share capital and voting rights of the
Company. This forced Futebol Clube do Porto, on the same date to launch a takeover bid
for the same price of the referred acquisition over the totality of the shares of Futebol
Clube do Porto, SAD admitted to negation on the Euronext Lisbon’s regulated market.
viii)
Renegotiation of loans
FC Porto SAD renegotiated in September 2014, two loans with the Novo Banco (formerly
BES). Thus, the financing identified in Note 18 with the total amount of 17,000,000 Euro
had its reimbursement plan extended until September 30, 2018 and will be repaid in 5
annual payments (Note 18). Regarding the loan of 30,000,000 Euro, it was agreed to
extend the reimbursement plan, being now of 3,000,000 Euro in September 15, 2014;
2,000,000 Euro on October 31, 2014 and 25,000,000 Euro on September 15, 2015 (Note
18). According to this renegotiation if FC Porto SAD sell, give away or transfer, ceasing to
obtain the ownership, directly or indirectly, of (i) 100% of the economic rights of the
footballer Danilo Luiz da Silva, or (ii) 100 % of economic rights of footballer Jackson
Martinez, the amounts arising from these sales, free of commissions, will be used to
refund, all or part, of the amounts under the contract.
ix)
Champions League group’s stage qualification
During the 2014/15 season, FC Porto SAD ensured the presence in the Champions League
group’s stage.
37. APPROVAL OF THE FINANCIAL STATEMENTS
The accompanying financial statements were approved by the Board of Directors on 9 October
2014.
___________________________________________________________________________________________
95
2013/2014
___________________________________________________________________________________________
38. EXPLANATION ADDED FOR TRANSLATION
These consolidated financial statements are a translation of financial statements originally issued
in Portuguese in accordance with International Financial Reporting Standards (IFRS/IAS) as
adopted by the European Union and the format and disclosures required by those Standards,
some of which may not conform to or be required by generally accepted accounting principles in
other countries. In the event of discrepancies, the Portuguese language version prevails.
___________________________________________________________________________________________
96
2013/2014
___________________________________________________________________________________________
7. Legal Certification of Accounts and Audit Report
(Translation of a report originally issued in Portuguese – Note 37)
Introduction
1. In compliance with the applicable legislation, we hereby present our Statutory Audit and Auditors’
Report on the consolidated financial information contained in the Board of Directors’ Report and
on the accompanying consolidated financial statements for the year ended 30 June 2013 of Futebol
Clube do Porto – Futebol, S.A.D. (“Company”) and subsidiaries (“Group”), which comprise the
Consolidated Statement of Financial Position as of 30 June 2013 (that presents total net assets of
227,852,575 Euro and shareholders’ equity of 7,627,355 Euro, including a net consolidated profit
attributable to the Parent company of 20,355,997 Euro), the Consolidated Statements of Profit
and Loss, of Comprehensive Income, of Changes in Equity and of Cash Flows for the year then
ended and the corresponding notes.
Responsibilities
2. The Company’s Board of Directors is responsible for: (i) the preparation of consolidated financial
statements that present a true and fair view of the financial position of the companies included in
the consolidation, the consolidated results and comprehensive income of their operations, the
changes in consolidated equity and their consolidated cash flows; (ii) the preparation of historical
financial information in accordance with International Financial Reporting Standards as adopted
by the European Union and that is complete, true, timely, clear, objective and licit, as required by
the Portuguese Securities Market Code; (iii) the adoption of adequate accounting policies and
criteria and the maintenance of appropriate internal control systems; and (iv) the disclosure of any
significant facts that have influenced the operations of the Company and companies included in
the consolidation, their financial position, results and comprehensive income.
3. Our responsibility is to examine the financial information contained in the documents referred to
above, including verifying that, in all material respects, the information is complete, true, timely,
clear, objective and licit, as required by the Portuguese Securities Market Code, and to issue a
professional and independent report based on our examination.
Scope
4. Our examination was performed in accordance with the Auditing Standards (“Normas Técnicas e
as Directrizes de Revisão/Auditoria”) issued by the Portuguese Institute of Statutory Auditors
(“Ordem dos Revisores Oficiais de Contas”) which require that the examination be planned and
performed with the objective of obtaining reasonable assurance about whether the consolidated
financial statements are free of material misstatement. Such an examination includes verifying, on
a test basis, evidence supporting the amounts and disclosures in the consolidated financial
statements and assessing the significant estimates, based on judgments and criteria defined by
the Board of Directors, used in their preparation. Such an examination also includes: verifying the
consolidation procedures and that the financial statements of the companies included in the
consolidation have been appropriately examined, assessing the adequacy of the accounting
policies used and their uniform application and disclosure, taking into consideration the
circumstances, verifying the applicability of the going concern concept, verifying the adequacy of
the overall presentation of the consolidated financial statements, and assessing that, in all material
respects, the consolidated financial information is complete, true, timely, clear, objective and licit.
Our examination also comprised verifying that the consolidated financial information included in
the consolidated Board of Directors’ Report is consistent with the consolidated financial
statements as well as the verifications established in numbers 4 and 5 of the article 451º of the
___________________________________________________________________________________________
97
2013/2014
___________________________________________________________________________________________
Commercial Company Code (“Código das Sociedades Comerciais”). We believe that our
examination provides a reasonable basis for expressing our opinion.
Opinion
5. In our opinion, the consolidated financial statements referred to in paragraph 1, present fairly, in
all material respects, the consolidated financial position of Futebol Clube do Porto – Futebol, S.A.D.
and subsidiaries as of 30 June 2013, the consolidated results and comprehensive income of its
operations, consolidated changes in its equity and its consolidated cash flows for the year then
ended, in accordance with the International Financial Reporting Standards as adopted by the
European Union, and the financial information contained therein is, in terms of the definitions
included in the auditing standards referred to in paragraph 4, complete, true, timely, clear,
objective and licit.
Emphasis
6. The Company’s individual financial statements as of 30 June 2013, show that half of its share
capital has been lost and, as such, the provisions of articles 35 and 171 of the Commercial Company
Code (“Código das Sociedades Comerciais”) are applicable. As mentioned in the Board of Directors’
Report and in Note 16 of the Notes to the consolidated financial statements, the Board of Directors
believes that this situation should be analysed and decided in the Shareholders’ General Meeting
in order to adjust equity to the legal requirements. In addition, the individual and consolidated
financial statements as of that date present a negative working capital and almost all the accounts
receivable from Futebol Clube do Porto have an estimated recovery period in the long term, as
mentioned in Note 11 of the Notes to the consolidated financial statements. The accompanying
consolidated financial statements were prepared on a going concern basis, which considers the
continued financial support of the financial institutions (Note 18), as well as the success of the
Company’s future operations, namely the positive outcome of the disposal of players’
registrations, as has occurred in previous years, and as foreseen in its operating and cash-ﬂow
budgets, essential to the balance and fulfilment of financial commitments.
Reporting over other legal requirements
7. It is also our opinion that the financial information included in the Board of Directors’ Report is in
accordance with the consolidated financial statements of the year and that the Corporate
Governance Report includes the information required to the Company, as established by the
Article 245º- A of the Securities Market Code.
Porto, 11 October 2013
Deloitte & Associados, SROC S.A.
Represented by António Manuel Martins Amaral
___________________________________________________________________________________________
98
2013/2014
___________________________________________________________________________________________
8. Report and Opinion of the Audit Committee
To the Shareholders,
In compliance with the applicable legislation and in accordance with the terms of our mandate, the
Audit Committee issues its report and opinion over the management report and the remaining
documents of individual and consolidated financial statements of FUTEBOL CLUBE DO PORTO –
FUTEBOL SAD, for the year ending on the 30th of June 2014, under the responsibility of the Board of
Directors.
Supervision
During the financial year, we have accompanied the management of the Company, the evolution of its
activities and participations, promoting meetings as we saw fit. These meetings, considering the
subjects analysed, had the presence of the operational heads of the financial department, the Board
of Directors. We also kept a close proximity to the Statutory Auditor, who kept us informed on the
nature and conclusions of the audits performed. On keeping his duties, the Audit Board received from
the Board of Directors, the services of all the companies in the Group and the Statutory Auditor, all the
requested information and explanations, necessary for a full evaluation and understanding of the
evolution of the businesses, the performance and the financial standing, as well as risk management
and internal control.
The Audit Board also accompanied the preparation and disclosing procedures of the financial
information, as well as the review to the documents of individual and consolidated financial
statements of the company, and received from the Statutory Auditor all the information and
explanations required. Additionally, considering the attributions, the Audit Board analysed the
individual and consolidated balances on the 30th of June 2014, the individual and consolidated
demonstrations of the results by type, cash-flows, full income and changes to the own capital in the
period ending in that date and its attachments.
There was also an evaluation of the management report disclosed by the Board of Directors, and the
legal certification of accounts and audit report over accounts, disclosed by the auditor, to which the
Audit Board agrees.
Considering the data, the Audit Board believes that the constant information of the financial
demonstrations was done in conformity with the accounting, legal and statuary regulation applicable,
offering an honest and appropriate view of the of assets and liabilities, financial situation and results
of Futebol Clube do Porto – Futebol, SAD and the companies in the consolidation perimeter and that
the management report faithfully lays out the evolution in business, performance and position of the
issuer and of the companies included in the Group, and contains a description of the main risks and
uncertainties the company has to face.
After the accountings were closed, the Audit Board analysed the facts that occurred and that are fully
explained in the Management Report.
The Audit Board appreciates the cooperation of the Board of Directors and services.
___________________________________________________________________________________________
99
2013/2014
___________________________________________________________________________________________
Advice
As a consequence of what has been stated above, the Audit Committee suggests that the following are
to be approved:
a) the Management Report, the individual and consolidated balance sheets on the 30th of June 2014,
the individual and consolidated statements of results by nature, of cash flows and correspondent
annexes;
b) the proposition to apply the results of individual accounts presented by the Board of Directors.
Certificate of Responsibility
Under the terms of paragraph c) of n. 1 of article 245º of the Securities Code, the members of the Audit
Committee state that, to their knowledge, the information presented in this report, and other
accounting documents, has been gathered in conformity with applicable accounting standards, giving
a true and accurate image of assets and liabilities, of the financial situation and results of the issuer
and of the companies included in the Group.
Furthermore, they believe that the management report faithfully lays out the evolution in business,
performance and position of the Group and of the companies included in the Group, and contains a
description of the main risks and uncertainties the company has to face.
Porto, 10th of October 2014
The Audit Committee
José Paulo Sá Fernandes Nunes de Almeida - Chairman
Armando Luís Vieira de Magalhães - Member
Filipe Carlos Ferreira Avides Moreira - Member
___________________________________________________________________________________________
100
2013/2014
___________________________________________________________________________________________
C. Corporate Governance Report
PART I – INFORMATION ON THE SHAREHOLDER,
ORGANIZATION AND CORPORATE GOVERNANCE STRUCTURE
A. SHAREHOLDER STRUCTURE
I. Capital structure
1. Capital structure
On the 30th of June 2014, the social capital was fully subscribed and conducted, reached seventy five
million Euros, and was split up in fifteen million shares of category A and B (respectively 40 and 60%
of the capital), depending on the entity of the holder. The shares of category A are only in that category
if belonging to Futebol Clube do Porto, or the Managing Company of Social Participation where the
Club has the majority of social capital, automatically switching to category B if alienated to third
parties, on any share. For voting effects, each share counts as one vote.
The category A shares give the holder the following special rights:
• Right to veto the decisions of the general meeting intended to merge, split, transform or dissolve the
company and the change in statutes, increase or reduction of social capital and change of headquarters
(article 7, n. 2 of statutes), according to article 23, n. 3 od Decree 10/2013 of the 25th of January.
• Right to appoint at least one of the members of the Board of Directors, which will have the right to
veto in consideration of that entity with a similar objective as n. 2 of article 7 in the Statutes (article
11, n. 3 in statutes1).
2. Restrictions regarding the transmission of shares and share holders
There are legal restrictions to the holding of shares representing the capital of FC Porto – Futebol, SAD,
due to the specific demands of the sporting activity that rule its existence. Sporting companies are
ruled by the special legal regime set in Decree 67/97, on the 3rd of April according to the changes
introduced by Law n. 107/97, on the 16th of September, followed by Decree n. 10/2013, on the 25th of
January. Among those specific demands are:
•
The existence of two categories for shares, with category A shares remaining subscribed and
held, at any time, by the founding club, can only be legally apprehended or encumbrance in
favour of collective people of public right;
•
The special loyalty system of the Company to the founding club, which means that the club is
forced to maintain a minimum participation in the Company (not inferior to 10%); in attributing
special rights to the shares held by the founding club.
3. Own shares
___________________________________________________________________________________________
101
2013/2014
___________________________________________________________________________________________
FC Porto – Futebol, SAD holds 100 own shares, consolidated, worth 499€. These shares, with a very
small representation in the social capital of the company, are held by PortoSeguro, a company in the
consolidation perimeter, held at 90% by FC Porto – Futebol, SAD.
PortoSeguro acquired 100 shares when the SAD was created, in 1997, and hasn’t alienated or acquired
any share since. Thus, FC Porto – Futebol, SAD had, both at the start and at the end of the period under
analysis, 100 own shares, worth 500€ at the time of buy.
4. Significant agreements involving the company and which start, change or cease in case the control
of the company changes following a public acquisition offer, as well as its effects
There are no significant agreements of which the company is part and that will start, change or cease,
in case the control of the Company changes following a public acquisition, or agreements between FC
Porto – Futebol, SAD and the holders of the board of directors or workers foreseeing compensations
for renounce or destitution of members of the board, nor in case of dismissal of worker, firing without
a cause or termination of work relation, following a public acquisition offer.
FC Porto – Futebol, SAD has also not adopted any measure intending to stop the success of public
offers of acquisition that disrespect the interests of the Company and the shareholders.
5. Regime controlling the renewal or revocation of defensive measures, especially those that foresee
the limitation in number of detainable votes or belonging to a single shareholder, individually or
under several shareholders
FC Porto – Futebol, SAD does not foresee any defensive for automatic and deep erosion to the
patrimony of the Company in case of transition in control or change in composition of the Board,
endangering the free trade of shares and free appreciation by shareholders of the performance of
holders of the Board.
6. Prosocial agreements known to the company and that may lead to restrictions in terms of
transmission of assets or rights to vote
The Board of Directors is unaware of any prosocial agreement as described in Art. 19 of the Portuguese
Security Code regarding the exercise of social rights, or the transmission of shares of FC Porto –
Futebol, SAD.
There is no union to vote or defence agreement against public acquisition offers (OPA).
II. Social Participations and Obligations detained
7. Qualified holdings
Under and for the purposes of Articles 16 and 20 of the CMVM and Article 448 of the Companies Code,
it is reported that the Company and / or individuals with qualified social participation exceeding 2%,
5%, 10%, 20%, a third, 50%, two thirds and 90% of the votes, and according to reports received at the
headquarters of the Company are, as of the 30th of June 2014, as follows:
___________________________________________________________________________________________
102
2013/2014
___________________________________________________________________________________________
Directly
Through Jorge Nuno de Lima Pinto da Costa
Through Reinaldo da Costa Teles Pinheiro
Total Attributable
N. of Shares
6.000.000
206.000
9.850
6.245.850
% Voting rights
40,00%
1,23%
0,07%
41,44%
Imobiliária Sacyr Vallehermoso, S.A.
Through Somague Imobiliária
Through Somague Engenharia
Total Attributable
N. of Shares
1.359.093
1.459.092
2.818.185
% Voting rights
9,06%
9,73%
18,79%
Note: The Company Somague Imobiliária is owned 100% by Vallehermoso, which in turn is owned 100% by Sacyr
Vallehermoso, S.A.
The company Somague Engenharia is owned 100% by Somague, S.G.P.S., S.A., which in turn is owned 100% by Sacyr SAU,
owned 100% by Sacyr Vallehermoso, S.A..
The company Somague Investimentos Gestão e Serviços, S.A. is fully owned by Somague Engenharia, which is owned 100%
by Somague, S.G.P.S., S.A., in turn owned 100% by Sacyr SAU, owned 100% by Sacyr Vallehermoso, S.A..
António Luís Alves Oliveira
Directly
Through Francisco António de Oliveira
Total Attributable
N. of Shares
1.650.750
980
1.651.730
% Voting rights
11,01%
0,01%
11,01%
Joaquim Francisco Alves Ferreira de Oliveira
Through Sportinveste – SGSPS, SA
N. of Shares
1.502.188
% Voting rights
10,01%
8. Number of shares and bounds held by members of the Board of Directors and Advisory Council,
under the terms of n. 5 of art. 447 of the Portuguese Companies Code
Under the terms of art. 447 of the Portuguese Companies Code, it should be informed that, as of the
30th of June 2014, the directors of FC Porto – Futebol, SAD had the following shares:
Shares held by members of the Board of Directors
Jorge Nuno de Lima Pinto da Costa*
Adelino Sá e Melo Caldeira*
Fernando Manuel Santos Gomes *
Reinaldo Costa Teles Pinheiro*
Rui Ferreira Vieira de Sá*
Number of shares
250.000
0
0
9.850
0
* Futebol Clube do Porto, of which he is Chairman/Vice-Chairman of the Board, had 6.000.000 shares as off the
30th of June 2014
Shares held by members of the Advisory Council
José Paulo Sá Fernandes Nunes de Almeida
Armando Luís Vieira de Magalhães
Filipe Carlos Ferreira Avides Moreira
Number of shares
100
0
10
___________________________________________________________________________________________
103
2013/2014
___________________________________________________________________________________________
As off the 30th of June 2014, the Auditor had no representative shares of the social capital of FC Porto
– Futebol, SAD.
9. Special powers of the Board of Directors, regarding the increase of capital
Without prejudice of the several given by Law and the Statutes of the Company, the Board of Directors
must assure the management of any social business and any operation regarding social focus, as they
are given full powers, namely to:
a) Represent the Company, at all times, propose and dispute any actions, demand and release
and make commitments in terms of decisions. For that, the board must delegate these powers
in one mandatary;
b) Create a company budget, to be approved by the General Meeting;
c) Acquire, alienate and ornate or relocate assets, including shares, quotas, bounds and right to
sign players;
d) Sign sporting contracts and sporting training contracts and proceed to dismiss them, by mutual
or unilateral agreement;
e) Acquire real-estate;
f)
Decide if the Company should associate with other entities, under the terms of art. 4 of the
Statutes;
g) Decide on the emission of bounds and apply for loans in the national and/or international
financial market and accept audits from relevant entities;
h) Appoint any other individual or collective entity for social positions in other companies.
The Board of Directors does not hold powers to decide on the increase of capital. As determined in
article 7 of the Statutes of the Company, any increase to the capital requires previous analysis of the
General Meeting, as shares of Category A, held by Futebol Clube do Porto (Clube), offer right to veto
of any decision of the General Meeting which aim at increasing or decreasing if social capital. Still, as
line b) of article 23, n. 2 of Decree n. 10/2013, of the 25th of January goes into effect, FC Porto no longer
has, by Law, the right to veto over the change in statutes of FC Porto SAD or over the increase and
decrease of social capital of that company, now being given the right to veto any chance to the emblem
or equipment of its professional football teams.
10. Relevant commercial relations between owners of bounds and the Company
There are no significant economic businesses for any of the parties involved, between the Company
and the member of the Board of Directors, Audit Board, owners of qualified holdings or Companies
under control of the Group, except the businesses or operations done under normal circumstances for
similar operations, part of the current activity of the Company.
___________________________________________________________________________________________
104
2013/2014
___________________________________________________________________________________________
B. SOCIAL BODIES AND COMMITTEES
I. GENERAL MEETING
a) Members of the General Meeting Board
11. Identification and position of the members of the board of the general meeting and its term
In the General Meeting on the 13th of February 2012, it was decided to elect, for the period 2012/2015,
José Manuel de Matos Fernandes as chairman of the General Meeting and Rui Miguel de Sousa Simões
Fernandes Marrana as secretary of the General Meeting.
b) Exercising right to vote
12. Possible restrictions in terms of right to vote
FC Porto – Futebol, SAD, before each General Meeting, and following the legal dates, discloses the
warning that a meeting will be held, including in the institutional website of the Company
(www.fcporto.pt).
According to the Statutes of the Company, all shareholders with voting right may participate in a
General Meeting, as long as the shares are under their name by zero hours (GMT) of the 5th working
day before the meeting, and if they prove their registration before the Company until the same of that
5th day, stating their intention to be a part of the meeting in a written letter addressed to the Chairman
of the General Meeting no later than the sixth day before the General Meeting, with the option of
using electronic mail to do so. Still, the last Chairmen of the General Meeting have decided that,
considering the issues with delivery of declarations of shares, any copies received by fax or e-mail
should be accepted, as long as they follow the date disclosed in the Statutes and if the original is
received before the General Meeting.
Shareholders that have a statute of singular person may be represented in the General Meetings under
the current Law. Collective should be represented by someone designated to do so through a letter
that must be admitted by the Chairman of the General Meeting.
The Company offers the Shareholders a representation form which can be requested at the Company,
by phone (+351225070500) or e-mail (geral@fcporto.pt). The documents for voluntary representation
must be handed at the social headquarters, addressed to the Chairman of the General Meeting, at
least three days before the General Meeting, and specifying the relevant meeting, by stating the date,
time and location it will be held and the Order of Work, leaving no doubts to the Chairman about the
representative, which must be identified.
The statutes of the Company, on n. 4 of art. 8, admit the issuing of preferential shares, without vote
rights, that may be redeemable, for the nominal value, added of a prize or not, if the General Meeting
decides to do so. Should this be the case, the prize for the remission must be defined. In case the
remission is not complied, the company must compensate the holder, for an amount set during the
remission. However, this type of share was never emitted.
___________________________________________________________________________________________
105
2013/2014
___________________________________________________________________________________________
By the end of each General Meeting, the Company issues a statement, made available on their website,
as well as in the official website of CMVM, with the decisions made, the capital represented and the
results of the voting. The minutes of the meetings are sent to any shareholder that requests them. To
follow the recommendations of CMVM, the Company, as of 2009, made these minutes available at
their website, for fifteen days, as stipulated in Decree n. 49/2010.
13. Maximum percentage of vote rights that may be used by a single shareholder or by shareholders
connected through n. 1 of art. 20
Regarding the right to vote, each share means one vote, and attendance at the General Meeting is not
restricted to a minimum number of shares.
There are also no statutory rules that foresee the existence if shares that do not offer right to vote or
that establish that voting rights should be ignored after a certain number of shares, when issued by a
single shareholder or several related to him.
14. Decisions that, by statutory requirement, can only be taken by a qualified majority
According to article 20 of the Statutes, the General Meeting will rule over any number of shareholders
present or represented, in both calls, without legal demands of a constitutive number for certain acts,
and, namely, the need to, in the first call, there are at least two thirds of the total number of votes for
the Meeting to approve some of the acts foreseen in art. 13, n. 2 of these Statutes (“Any act exceeding
the previsions inscribed in the budget requires authorization of the general meeting, after a
deliberation approved by simple majority, and the alienation and transaction, of any kind, of assets
pertaining to the patrimony of the Company must be approved by two thirds of the votes issued”).
II. ADMINISTRATION AND SUPERVISION
a) Composition
15. Identification of the business model adopted
The structure of the Governing Body of the Company is based on the reinforced Latin model and is
composed of the Board of Directors, Audit Board and the Auditor, voted by the General Meeting of
Shareholders.
16. Statutory rules on procedural requirements and applicable material to appoint and replace the
members, if applicable, of the Board of Directors
The replacement of a director will occur under the terms of the Portuguese Companies Code, as there
are no statutory rules on that matter, occurring in one of the following: if there are no substitute
directors, the Board must choose a director, which will be approved in the next General Meeting; if a
choice isn’t done in 60 days, the Audit Board will appoint a substitute director, which must also be
approved on the next General Meeting; if that doesn’t occur, the new director will be elected on the
General Meeting.
___________________________________________________________________________________________
106
2013/2014
___________________________________________________________________________________________
There are no statutory rules that set the selection process of the non-executive directors. The election
of the Governing Bodies, namely the Board of Directors, including all the members, is done as one
process, in a list presented by the shareholders that wish it and approved in General Meeting.
17. Composition of the Board of Directors
According to the Statutes of the Company, the Company is ran by a Board of Directors, composed of
three, five, seven or nine members, which must be professional managers, elected in General Meeting,
and appoint a chairman, if one hasn’t been set in the Meeting. The mandate of the governing bodies
lasts four years, and re-election may occur one or more times.
Currently, this body is composed of 5 members, 4 of which are executive, and all must manage the
Company.
In a Shareholder General Meeting, held on the 13th of February 2012, the following elements were
elected for the 2012/2015 mandate of the Board of Director, with the following positions:
Name
Jorge Nuno de Lima Pinto da Costa (Chairman)
Fernando Manuel Santos Gomes (*)
Reinaldo Costa Teles Pinheiro
Rui Ferreira Vieira de Sá (non-executive)
Date of first
election
23-Sept-1997
23-Sept-1997
31-Mar-2014
23-Sept-1997
13-Feb-2012
Date of term of
mandate
31-Dec-2015
31-Dec-2015
31-Dec-2015
31-Dec-2015
31-Dec-2015
(*) Following the renunciation of Angelino Cândido de Sousa Ferreira from the position of Director,
Fernando Manuel Santos Gomes was chosen for that position, starting on the 31st of March 2014.
18. Difference between executive and non-executive members and identification of non-executive
members that may be considered independent
On the 30th of June 2014, the Board of Directors included a non-executive member: Rui Ferreira Vieira
de Sá.
The members of the Board of Directors are not independent, as all, except for Rui Ferreira Vieira de
Sá, are part of the Board of Futebol Clube do Porto, holder of about 40% of the capital of Futebol Clube
do Porto – Futebol, SAD, and have a dominant influence on it. Rui Ferreira Vieira de Sá is part of the
Board of Directors of Somague Engenharia, SA, which is owned 100% by Somague, S.G.P.S., S.A., which
in turn is owned 100% by Sacyr SAU, owned 100% by Sacyr SYV, a company that owns 18,79% of the
social capital of Futebol Clube do Porto – Futebol, SAD.
The non-executive director conducted his duties not only by participating in the meetings of the Board
of Directors, but also by accompanying and supervising the work of the executive directors, by
requesting further information on matters analysed by the Board of Directors, such as financial,
governance and regulatory aspects. It should be said there were no restraints to the work done by the
non-executive director.
___________________________________________________________________________________________
107
2013/2014
___________________________________________________________________________________________
Any information requested to the other members of the Governing Bodies was given as quickly as
possible and adequately.
19. Professional qualifications of the members of the Board of Directors
Jorge Nuno de Lima Pinto da Costa
• Education: Secondary complete
• Other positions held at FC Porto Group, referred to in section 2.2.2.
•
•
•
•
•
Degree in Law by the Universidade Federal do Estado do Rio de Janeiro, in 1980
Lawyer since 1980 until today
Member of the Law Firm Graça Moura & Associates from 1996 to 2005
Member of the Law Firm Gil Moreira dos Santos, Caldeira, Cernadas & Associates since 2005
Other positions held at FC Porto Group, referred to in section 2.2.2.
• Degree in Economics by the Instituto Superior de Ciências Económicas e Financeiras da Universidade
Técnica de Lisboa, in 1971
• Member of the Board of Directors of Galp Energia, SGPS
• Other positions held at the Grupo FC Porto, referred to in section 2.2.2.
• Education: 1st Cycle of Basic Education
• Other positions held at FC Porto Group, referred to in section 2.2.2.
• Degree in Civil Engineering by the Faculdade de Engenharia of Universidade do Porto, in 1977
• From 1977 to 1996, Head of Services and Construction Director of Grupo Somague
• Other positions referred to in section 2.2.2.
20. Family or financial relations, usual or significant, between members of the Board of Directors
and shareholders with a qualified participation above 2% of the voting rights
There are no family, professional or business relations, usual or significant, between members of the
Board of Directors and shareholders with a qualified participation above 2% of the voting rights.
21. Organigram or functional maps regarding the distribution of competences between the several
governing bodies, committees and/or departments of the Company, including information about
delegation of competences, especially referring to the delegation of the daily management of the
Company
The Governing Bodies of FC Porto - Futebol, SAD are composed of the General Meeting, the Board of
Directors, the Audit Committee, the Statutory Auditors, the Company Secretary, the Advisory Board
and the Remuneration Committee.
___________________________________________________________________________________________
108
2013/2014
___________________________________________________________________________________________
FC Porto - Futebol, SAD has no executive committee, given its small dimension, and holds the
Management Board responsible for ensuring the daily management of the Company.
b) Functioning
22. Existence and location where the regulations for the functioning of the Board of Directors may
be consulted
The Governing Bodies of FC Porto – Futebol, SAD do not have formally approved functioning
regulations. However, the members intend to set those regulations and disclose them afterwards in
the website of Futebol Clube do Porto (www.fcporto.pt).
23. Number of meetings held and attendance of each member of the Board to the meetings
In this period, the Board of Directors met 11 times, and a minute was made for each meeting. These
are available to any Governing Body who wishes to consult them. All members of the Board attended
all the meetings.
24. Indication of the bodies of the Company that may assess the performance of the executive
directors
Considering the model of the Governing Body implemented by FC Porto – Futebol, SAD, that integrates
a Remuneration Committee, and given the small size of the Company, it was decided that there was
no need for the creation of specialized commissions with the single purpose of evaluating the
performance of the executive directors or the activity of existing commissions.
On the other hand, FC Porto – Futebol, SAD, for its specificity as a Sporting Company, in the
performance of its activity, has a number of obligations to keep in face of sporting bodies. In order to
participate in national and European competitions, the Company has to meet a number of criteria,
especially of financial order, which, in a way, will prove the competence of the Board, as, if they are
not met, the team will be excluded from competing.
___________________________________________________________________________________________
109
2013/2014
___________________________________________________________________________________________
25. Pre-established criteria to evaluate the performance of the executive directors
Under the terms of their competences, the Remuneration Committee, re-elected on February 2012 for
the period 2012/2015, decided to change the remuneration policy approved in General Meeting,
which, despite being analysed annually, remained the same throughout the term. The effects on the
period analysed led to a revocation of variable remunerations, considering the sporting performance
of the main squad of FC Porto.
The proposition for the new remuneration policy of the Board of Directors and supervision of the
Company was presented and analysed by the shareholders in the General Meeting of 2013, having
been approved.
In this period, the remunerations of the members of the governing body did not depend on the
evolution of the quotas of shares or any other variable.
There was no plan to offer shares or options to acquire shares to the directors. There was also no policy
or measure set in terms of offering compensations contractually negotiated, in case of termination of
duties or early retirement, or mechanisms to limit the variable remuneration. There was no contractual
obligation regarding the compensation for dismissal without cause.
26. Availability of each member of the Board of Directors, indicating the positions held
simultaneously with other companies, in and out of the Group, and other relevant activities held by
the members of those Bodies during this period
•
•
•
•
•
•
•
•
•
•
Chairman of the Board of FC Porto
Chairman of the Board of InvestiAntas, SGPS, SA
Chairman of the Board of EuroAntas, Promoção e Gestão de Empreendimentos Imobiliários, SA
Chairman of the Board of Directors of PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, SA
Chairman of the Board of Directors of Fundação PortoGaia para o Desenvolvimento Desportivo
Chairman of the Board of FCPortoMultimédia, Edições Multimédia, SA
Chairman of the Board of PortoComercial, Sociedade de Comercialização, Licenciamento e Sponsorização, SA
Chairman of the Board of FC Porto – Serviços Partilhados, SA
Chairman of the Board of FCP Media, SA
Chairman of the Board of Dragon Tour, Agência de Viagens, SA
•
•
•
•
•
•
•
•
•
•
Vice-Chairman of the Board of FC Porto
Member of the Board of Directors of Investiantas, SGPS, SA
Member of the Board of Directors of EuroAntas, Promoção e Gestão de Empreendimentos Imobiliários, SA
Member of the Board of Directors of PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, SA
Member of the Board of FCPortoMultimédia, Edições Multimédia, SA
Member of the Board of PortoComercial, Sociedade de Comercialização, Licenciamento e Sponsorização, SA
Manager of PortoSeguro – Sociedade Mediadora de Seguros do Porto, Lda.
Member of the Board of FC Porto – Serviços Partilhados, SA
Member of the Board of FCP Media, SA
Member of the Board of Dragon Tour, Agência de Viagens, SA
• Member of the Board of Directors of Galp Energia, SGPS
• Vice-Chairman of the Board of FC Porto
___________________________________________________________________________________________
110
2013/2014
___________________________________________________________________________________________
•
•
•
•
•
•
•
Member of the Board of EuroAntas, Promoção e Gestão de Empreendimentos Imobiliários, SA
Member of the Board of PortoComercial, Sociedade de Comercialização, Licenciamento e Sponsorização, SA
Member of the Board of PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, SA
Manager of PortoSeguro – Sociedade Mediadora de Seguros do Porto, Lda.
Member of the Board of FC Porto – Serviços Partilhados, SA
Member of the Board of FCP Media, SA
Member of the Board of Dragon Tour, Agência de Viagens, SA
Reinaldo Teles da Costa Pinheiro
• Vice-Chairman of the Board of FC Porto
•
•
•
•
•
•
•
•
Chairman of the Board of Somague SGPS, SA, since January 15th 2013;
Chairman of the Board of Somague Engenharia, SA;
Chairman of the Board of Somague Concessões de Infraestruturas, SA;
Chairman of the Board of Somague Imobiliária, SA;
Chairman Director of Somague Engenharia Brasil;
Member of the Board of Directors of Viaexpresso da Madeira, S.A.;
Member of the Board of Directors of Escala Parque – Gestão de Estacionamento, S.A.;
Non-executive Member of the Board of Directors of Somague MPH Construções, S.A.;
c) Commissions in the Governing Bodies and delegated directors
27. Identification of commissions created in the Board of Directors and where can the regulations be
found
The Board of Directors believes that the only specialized commission capable of facing the needs of
the Company, considering the dimension and complexity, is the Remuneration Committee.
The Remuneration Committee of FC Porto – Futebol, SAD aims at setting the remunerations of the
members of the Governing Bodies of the Company and set the remuneration policy to be applied to
the member of the Board of FC Porto – Futebol, SAD.
The current Remuneration Committee of FC Porto – Futebol, SAD (for the period 2012-2015) is
composed of the following members:
•
•
•
Alípio Dias (Chairman)
Fernando Freire de Sousa
Joaquim Manuel Machado Faria de Almeida
28. Composition, if applicable, of the executive commission and/or identification of delegate
director(s)
FC Porto – Futebol, SAD did not appoint an Executive Commission of the Board of Directors, and any
decisions regarding strategies adopted by the Board of Directors as a body will be composed of all
members, executive and non-executive, in the normal performance of their duties.
___________________________________________________________________________________________
111
2013/2014
___________________________________________________________________________________________
29. Competences of each commission created and summary of the activities developed when doing
those competences
The Board of Directors believes that the only specialized commission capable of facing the needs of
the Company, considering the dimension and complexity, is the Remuneration Committee.
The Remuneration Committee is composed of members independent to the administration. To that
extent, the Remuneration Committee does not include any member of another governing body to
which it sets the respective remuneration, and the three members have no family bonds with members
of other bodies, including as their spouses, kin or straight line to the 3rd degree. The members of the
Remuneration Committee have knowledge and experience concerning remuneration policy. During
the financial year of 2013/2014 the Remuneration Committee did not find necessary to hire additional
support to their duties. After each meeting, the Remuneration Committee produces a minute.
This committee is responsible for assessing the performance of the executive directors and consequent
remuneration, and will follow the criteria they see as fit, in compliance with the law and the current
statutory practices.
III. SUPERVISION
a) Composition
30. Identification of the supervision body on the adopted model
The structure of the Governing Body of the Company is based on the reinforced Latin model and is
composed of the Board of Directors, Audit Board and the Auditor, voted by the General Meeting of
Shareholders.
31. Composition of the Audit Committee, indicating the minimum and maximum statutory number
of members, statutory duration of terms, number of effective members, date of the first
appointment and date of term of mandate of each member.
According to the Statutes of the Company, the supervision of the Company will be made by an Audit
Committee and an Auditor. The Audit Committee is composed of three effective members and one
replacement. The mandate of the members of governing bodies lasts for four years, and the re-election
is allowed for one or more times.
In a Shareholder General Meeting held on the 13th of February of 2012, the following members were
elected to be part of the Audit Committee for the period 2012/2015:
Name
Date of first election Date of term of
mandate
13-Nov-2008
31-Dec-2015
29-Feb-2008
31-Dec-2015
29-Feb-2008
31-Dec-2015
___________________________________________________________________________________________
112
2013/2014
___________________________________________________________________________________________
This body is currently composed of three members, as the replacement member asked to be excused
from duties.
32. Identification of the independent members of the Audit Committee, according to art. 414.º, n.º
5 of the CSC
As stated by the members, the regulations for incompatibility and independence criteria foreseen in
nº 1 or article 414 A and nº 5 of article 414, respectively, both part of the Portuguese Companies Code,
apply.
33. Professional qualifications of each member of the audit Committee and other relevant
information
• Degree in Economics from the Faculdade de Economia do Porto
• Business Activity:
1982/1984
Technical Sales Department at the Banco Português do Atlântico.
1984/2005
Director of the Company Sofite - Sociedade Industrial de Fibras Têxteis, SA.
1984/2004
Managing Partner of the ATM - Gabinete de Gestão, Lda.
1990/2000
Manager of the Gorem - Sociedade Técnica de Serviços, Lda.
1991/1993
Director of Risfomento - Sociedade de Fomento Empresarial, SA.
1994/2014
Managing Partner of TRL - Têxteis em Rede, Lda.
1994/2011
Managing Partner of Expomoda – Têxteis e Representações, Lda.
2002/2004
Managing Partner of Ninfamar - Indústria de Confecções, Lda.
2010/2013
Managing Partner of Hot Pink – Comércio, Lda.
• Corporate Activity:
1986/1996
Vice-Chairman of ANJE - Associação Nacional de Jovens Empresários.
1991/1994
Director of APET – Associação Portuguesa dos Exportadores de Têxteis.
1994/2003
Vice-Chairman of the General Council of the ATP – Associação Portuguesa de Têxteis e Vestuário.
1996/2000
Member of the Economic and Social Council.
1996/2002
Chairman of the General Meeting of ANJE – Associação Nacional de Jovens Empresários.
1996/2011
Vice-chairman of the Board of Sport Club do Porto.
1997/2001
Director of the Associação Comercial do Porto – Câmara de Comércio e Indústria do Porto.
1997/2002
Member of the National Commission for Monitoring the IMIT – Iniciativa para a Modernização da
Indústria Têxtil.
Since 1999
Member of the Executive Committee of the project Portugal Fashion.
2001/2003
Member of the Audit Committee of MTV – Movimento do Têxtil e do Vestuário.
2002/2006
Chairman of the General Office of the Associação Gabinete de Desporto do Porto.
2003/2008
Chairman of the Board of ATP – Associação Têxtil e Vestuário de Portugal.
2004/2008
Vice-Chairman of the Board of CIP – Confederação da Indústria Portuguesa.
2004/2010
Member of the Monitoring Committee of Prime – Programa de Incentivos à Modernização da
Economia.
Since 2004
Chairman of the General Meeting of AAJUDE – Associação de Apoio à Juventude Deficiente.
2005/2008
Member of the General Council and the Board of Directors of AEP – Associação Empresarial de
Portugal
Since 2005
Chairman of the Audit Committee ofAssociação Fórum Manufuture Portugal
2007/2013
Chairman of the General Council of PortoLazer – Empresa Municipal
Since 2007
Member of the Advisory Board of Fundação da Juventude.
2007/ 2008
Vice-Chairman of the Supervisory Board of Futebol Clube do Porto
2008/ 2014
Vice-Chairman of General Board and Board of Directors of AEP – Associação Empresarial de
Portugal.
2008/2013
Chairman of the Board of EURISKO Estudos, Projectos e Consultoria, S.A.
Since 2008
Member of the Board of Associação para a Feira Internacional do Porto – Exponor
Since 2008
Vice-Chairman of the Board of Europarque – Centro Económico e Social
___________________________________________________________________________________________
113
2013/2014
___________________________________________________________________________________________
Since 2008
Chairman of General Board of Exponor Brasil – Feiras e Eventos, Lda.
Since 2008
Chairman of the Board of CESAE – Centro de Serviços e Apoio às Empresas
Since 2008
Chairman of the Audit Committee of Futebol Clube do Porto, da Futebol Clube do Porto – Futebol,
SAD, da Porto Estádio – Gestão e Exploração de Equipamentos Desportivos, S.A. and Euroantas – Promoção e
Gestão de Empreendimentos Imobiliários, S.A.
Since 2009
Chairman of the Board of Directors of Fundação AEP
Since 2010
Chairman of the Audit Committee of ATP – Associação Têxtil e Vestuário de Portugal
2011/ 2013
Chairman of the Audit Committee of Futebol Clube do Porto – Basquetebol, SAD.
Since 2011
Vice-Chairman of the General Board of CIP – Confederação Empresarial de Portugal
Since 2011
Chairman of the General Meeting of AGAVI – Associação para a Promoção das Gastronomia, Vinhos,
Produtos Regionais e Biodiversidade
Since 2012
Chairman of the General Meeting of Paredes Industrial- Parques Industriais, S.A.
Chairman of the General Meeting of Tirso Parques – Parques Empresariais de Santo Tirso, S.A.
Chairman of the General Meeting of Parque-Invest – Sociedade Promotora de Parques Industriais, SA., among
others.
Since 2013
Vice-Chairman of CCIAP – Câmara de Comércio e Indústria Árabe-Portuguesa.
Since 2014
Chairman of the General Meeting of Delegação Regional Norte da DECO
Since 2014
Chairman of the General Board and the Board of Directors of AEP – Associação Empresarial de
Portugal.
Other positions referred in 2.3.1.
•
•
•
•
•
•
•
•
•
Executive MBA - European Management (IESF / IFG), completed in 1996
Degree in Economics from the Faculdade de Economia do Porto, completed in 1978
Degree in Accounting (former ICP and current ISCAP), completed in 1972
From 1964 to 1989 he pursued his work in Portuguese credit institution and has held the following functions:
- Technical Analysis of the Department of Management;
- Head of Office of Planning and Management Control in the Northern Region;
- Head of Services Department of Accounting;
- Deputy Director;
- Deputy Director, appointed as head of the department North Executive Operation.
Certified Public Accountant since 1972
Statutory Auditor, individually, since 1989
Statutory Auditor, integrated in Sociedade Santos Carvalho & Associados, SROC, SA from 1989 to 2010
Statutory Auditor, integrated in Sociedade Armando Magalhães, Carlos Silva & Associados, SROC, Lda., since 2010
Other positions held referred to in section 2.3.1.
• Degree in Law at the Faculdade de Direito de Coimbra, in 1996
• Course of Commercial Law (Public Company) at Facoltà di Giurisprudenza dell’Università di Roma “La Sapienza” (Italy)
- in the 1st semester of 1995/96, under the ERASMUS project
• Postgraduate in European Studies at the Centro de Estudos Europeus da Faculdade de Direito de Coimbra, concluded
in 1997
• Accounting Course for Lawyers and Engineers at Universidade Católica Portuguesa, concluded in 1998
• Post-Graduation in Estudos Europeus at the Centro de Estudos Europeus of the Faculdade de Direito de Coimbra,
concluded in December 1997;
• Attendance of Graduate Public Law - The New Legal Director, Universidade Católica Portuguesa, during 2002/2003
• Attendance of Postgraduate in “The New Code for Public Contracts” at Escola de Direito of Universidade Católica
Portuguesa (Porto), 2009/2010
• Training in Specialization in “Public Contracts, Assessment of Propositions in Tender Procedures”, at Faculdade de
Direito of Universidade de Coimbra (CEDIPRE), 2009/2010
• Practiced as a lawyer in a law firm in Porto (February to April 1999)
• Practiced as a lawyer in law firm in Macau (Drª Manuela António) from April 1999 to April 2001;
• Practiced as a lawyer in a law firm in Porto (in his own name and as a collaborator/associate of the Company of
Advocates Cerqueira Gomes & Associados) from 2001 to 2009;
• Lawyer of Câmara Municipal do Porto from March 2003 to June 2004;
• Associate Attorney of Cuatrecasas, Gonçalves Pereira & Associates (from 2009 to 2013);
• Associate of Cuatrecasas, Gonçalves Pereira & Associados (2014);
___________________________________________________________________________________________
114
2013/2014
___________________________________________________________________________________________
• Instructor of the Law Bar, District Center of Porto, in the module “Company Law” (2006/2011);
• Instructor of Course for Expert Evaluators, organized by the Centro de Estudos Judiciários, 2009 Edition;
• Trainer at Cuatrecasas, Gonçalves Pereira in Escola de Direito of Universidade Católica Portuguesa (Porto), for the
seminars on Public Law, since 2010;
• Member of Editorial Board for Legal Area of Editora Brasileira Juruá;
• Member of União Internacional dos Advogados (UIA);
• Member of the Board of Comité Português da UIA since 2012;
• Vice-Chairman of the Conselho de Justiça of the Federação Portuguesa de Ténis since 2012;
• Other positions held referred to in section 2.3.1.
b) Functioning
34. Existence and location where the regulations for the functioning of the Audit Committee may be
consulted
The Governing Bodies of FC Porto – Futebol, SAD do not have formally approved functioning
regulations. However, the members intend to set those regulations and disclose them afterwards in
the website of Futebol Clube do Porto (www.fcporto.pt).
35. Number of meetings held and attendance of each member of the Audit Committee to the
meetings
In this period, the Audit Committee met 4 times, and a minute was made for each meeting. These are
available to any Governing Body who wishes to consult them. All members of the Board attended all
the meetings.
36. Availability of each member of the Audit Committee indicating the positions held simultaneously
with other companies, in and out of the Group, and other relevant activities held by the members
of those Bodies during this period
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Member of the Executive Board of the Project Portugal Fashion
Chairman of the General Assembly of AAJUDE - Associação de Apoio à Juventude Deficiente
Chairman of the Audit Committee of the Associação Fórum Manufuture Portugal
Member of the Advisory Board of Fundação da Juventude
Vice-Chairman of the General Council and the Board of Directors of AEP - Associação Empresarial de Portugal
Chairman of the General Council of Fundação AEP
Vice-Chairman of the Board of Europarque - Económico e Social
Chairman of the General Council of Exponor Brazil - Feiras e Eventos, Lda
Chairman of the Board of CESAE - Centro de Serviços e Apoio às Empresas
Vice-Chairman of the General Board of CIP – Confederação Empresarial de Portugal
Chairman of the General Meeting of AGAVI – Associação para a Promoção das Gastronomia, Vinhos, Produtos Regionais e
Biodiversidade
Chairman of the General Meeting of Paredes Industrial - Parques Industriais, SA
Chairman of the General Meeting of Tirso Parques – Parques Empresariais de Santo Tirso, SA
Chairman of the General Meeting of Parque-Invest – Sociedade Promotora de Parques Industriais, SA
Chairman of the Audit Committee of Futebol Clube do Porto
Chairman of the Audit Committee of PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, SA
Chairman of the Audit Committee of EuroAntas, Promoção e Gestão de Empreendimentos Imobiliários, SA
Chairman of the General Meeting of Delegação Regional Norte da DECO.
___________________________________________________________________________________________
115
2013/2014
___________________________________________________________________________________________
• Vice-Chairman of CCIAP – Câmara de Comércio e Indústria Árabe-Portuguesa.
•
•
•
•
•
•
•
Member of the Audit Committee of Sonae Indústria, SGPS, SA
Member of the Audit Committee of Sonae Capital, SGPS, SA
Member of the Audit Committee of Sonaecom, SGPS, SA
Member of the Audit Committee of the Fundação Eça de Queiroz
Account Rapporteur of the Audit Committee of Futebol Clube do Porto
Member of the Audit Committee Real Vida Seguros, SA
Member of the Audit Committee Sonae Investimentos SGPS, SA
•
•
•
•
Chairman of the General Assembly of the CPC AFRICA, SA
Chairman of the Board of Directors of Porto Digital – Operador Neutro de Telecomunicações, S.A.
Substitute of the Audit Committee of Futebol Clube do Porto
Member of the Audit Committee of PortoComercial, Sociedade de Comercialização, Licenciamento e Sponsorização, SA
c) Competences and duties
37. Description of the procedures and applicable criteria for the intervention of the supervision body
to contract the additional services of an external auditor
The Audit Committee, whenever appropriate, meets with the External Auditor not only in its own name
but also in that of the Company, pursuant to its powers. It is not under his role, however, to propose
the provider of the External Audit, given his recruitment precedes the appointment of a separate Audit
Committee of the Statutory Auditors. The external auditing services have been analysed independently
and standing by the supervisory board, issuing an annual opinion on the activity of the Auditor during
the year and making mention of any facts that could hinder the continuity of the office for just cause.
The Audit Committee is, along with the Board of Directors, the first recipient of the reports issued by
the external audit firm.
38. Other duties of the supervision body
The Audit Committee must supervise the activity of the company, confirming the compliance of the
law and statutes. As a result, the Audit Committee shall, on an annual basis, create a report on the
activities developed, stating any incompliance verified, and issue an opinion on the documents of
accountability and on the proposed appropriation of results, presented by the Board to the General
Meeting. This report is available for consultancy on the website of the Company, and on the website
of CMVM, together with the documents of accountability.
The annual reports on the activity of the Audit Committee are disclosed on the website of the
Company, together with the documents of accountability.
It must also represent the Company, for all purposes, at its External Auditor, responsible for, among
others, propose the person responsible for these services, their remuneration, ensure there are, within
the company, proper conditions to the provision of services, as well as being the partner of the
company, as the recipient of the reports at issue, together with the Board of Directors.
___________________________________________________________________________________________
116
2013/2014
___________________________________________________________________________________________
IV. Statutory Auditor
39. Identification of the statutory auditor and its representative
The position of Statutory Auditors of the Company is held by the Accounting Company Deloitte &
Associados, Sociedade de Revisores Oficiais de Contas, based in Edifício Atrium Saldanha, Praça Duque
de Saldanha, 1 - 6º 1050-094 Lisboa, registered in Ordem dos Revisores Oficiais de Contas with the
number 43 and with the CMVM under number 231, represented by António Manuel Martins Amaral
(ROC n.º 1130).
40. Indication of how long the statutory auditor has been working with the company and/or group
Deloitte & Associados, SROC, S.A. has been responsible for the statutory audits of the Company and
the companies in the Group since 2004, through its representative António Manuel Martins Amaral
since 2011.
41. Description of other services carried out by the Statutory Auditor to the company
The statutory auditor is also the external auditor of the Company, as detailed below.
V. EXTERNAL AUDITOR
42. Identification of the external auditor appointed under art. 8 and the statutory auditor
representative in those duties, and number of registration in the CMVM
The external auditor of the Company, appointed under art. 8 of the CVM, is Deloitte & Associados,
SROC, S.A., registered under the number 231 in the CMVM, represented by António Manuel Martins
Amaral.
43. Indication of how long the statutory auditor has been working with the company and/or group
The statutory auditor was elected for the first time in 2004 and is now on its third mandate, through
its representative António Manuel Martins Amaral since 2011.
44. Policy and frequency of rotation of the external auditor and its representative in its duties
The company has not set a period of rotation for the external auditor. However, the accounting
company has their own internal regulations, which demand the rotation of the external auditor every
seven years. This method has the full support of the Board of FC Porto – Futebol, SAD and its Audit
Committee.
___________________________________________________________________________________________
117
2013/2014
___________________________________________________________________________________________
45. Indication of the body responsible for the evaluation of the external auditor and frequency of
evaluation
The Audit Committee, in the function of its duties, ensures an annual evaluation of the independence
of the External Auditor. Additionally, the Audit Committee promotes, whenever possible or fitting for
the activity of the Company of the general market, an analysis on the adequacy of the External Auditor
to the exercise of its duties.
46. Identification of works, apart from audits, done by the external auditor, as well as indication of
internal procedures for the effects of approval in contracting such services and indication of reason
to the contracting
Other services done by the external auditor in 2013/2014 included those regarding the validation of
financial assumptions, so that the Company may play in the competitions organized by LPFP. Other
services are provided by different technicians involved in the audit procedure, which implies the
independence of the auditor.
The Audit Committee analysed and approved the services mentioned, concluding that they did not
question the independence of the External Auditor. On that consideration, the decision to contract
Deloitte proved to be optimal, due to their consolidated experience and knowledge in the operation
and accounting of the Company.
47. Indication of the amount in annual remuneration paid to the auditor and to other employees
belonging to the same network and indication of the percentages belonging to each service:
By the Company*
Services for account audit (€)
Services for compliance assessment (€)
Services for tax consulting (€)
Other services unrelated to accounting (€)
By entities part of the group*
Services for account audit (€)
Services for compliance assessment (€)
Services for tax consulting (€)
Other services unrelated to accounting (€)
TOTAL
€
89,000
10,000
23,250
0
%
73%
8%
19%
0%
0
0
0
0
122,250
0%
0%
0%
0%
100%
___________________________________________________________________________________________
118
2013/2014
___________________________________________________________________________________________
C. INTERNAL ORGANIZATION
I. Statutes
48. Applicable regulation to the change in statutes of the Company
As line b) of article 23, n. 2 of Decree n. 10/2013, of the 25th of January goes into effect, FC Porto no
longer has, by Law, the right to veto over the change in statutes of FC Porto SAD, and so the regulation
set by the Portuguese Companies Code will apply on this matter.
II. Communication of irregularities
49. Means and policy to communicate irregularities occurring in the company
Although the policy statement of internal irregularities is not formally defined, considering the
proximity of the members of the Board to the activities of the Company and its employees, FC Porto Futebol, SAD considers that such proximity allows the communication of whichever irregularities may
appear to the Board, ensuring the implementation of procedures aimed at dealing effectively and fairly
with any irregularities detected. At the level of expertise in evaluating ethical issues and the structure
and governance of the company, these functions are performed directly by the Board, specifically by
the administrator responsible for the legal department, which maintains a constant debate on the
issue.
The staff of FC Porto – Futebol, SAD must report to the legal department, or to the director in charge,
any irregular practices detected or suspected, in order to prevent or stop irregularities that may be
cause damages to the financial health of the company or to its honour. This report must be done in
writing and describe all the existing elements and information necessary to the assessment of the
irregularity; a first approach to the report may be done directly or by phone.
The communication of irregularities in the Company have ensured confidentiality and its sequel by any
preliminary investigation of the responsibility of those who, to this end, will be designated by the
concerning director.
III. 2.1. Internal control and risk management system
50. Persons, bodies or committees responsible for the internal audit and/or implementation of
internal control
The Internal Audit department is the department responsible for the internal control of the Company.
51. Description of the hierarchical and/or functional dependence relations with other bodies or
committees of the company
Both the Internal Audit and Compliance and the Management Planning and Control depend of the
Board of Directors.
___________________________________________________________________________________________
119
2013/2014
___________________________________________________________________________________________
The Audit Committee has no responsibility in the creation and functioning of the internal control
systems, but takes into consideration its existence and efficacy when assessing the risks to the
company.
52. Other functional areas with competences in risk control
There is also a Management Planning and Control department with the main intent of supporting the
administration in the detection of relevant financial risks, which means analysing periodically the
information related to financial planning and control, such as the business plan, the operation budgets
and treasury and its control, management indicators, among others. These procedures are designed
to help in the quality of the information disclosed to the market.
53. Identification and description of the main types of risk (economic, financial and legal) to which
the company is expose in its activity
The Board of Administration considers that FC Porto – Futebol, SAD is exposed to risks inherent to its
activity. Thus, the main financial risks the company believes to be subjected to are: market risk (interest
rate risk and currency risk), credit risk, liquidity risk, regulation risk (Financial Fair Play) and sporting
risk. The control mechanisms of these risks are described in the attachment regarding financial
demonstrations.
Apart from the financial risk, the activity of the company is also very reliant of the sporting
performance of the main football team. The sporting success is a key factor to obtain the traditional
revenues and to the value of its assets, as they represent invaluable gains to the company due to
transfers.
54. Description of the process of risk identification, evaluation, accompaniment, control and
management
The administration and supervising bodies of the company have been giving growing importance to
the development and improvement of the internal control and risk management systems, concerning
the operational, economic and financial aspects with a relevant impact to the activities of the group,
as recommended by national and international experts, including the CMVM.
Thus, for the financial year of 2010/2011, a department of Internal Audit has been created, developing
its activity in assessing the efficiency and efficacy of the internal control system and the business
procedures concerning the entire group, independently and systematically, in examining and
evaluating the rigour, quality and application of the operational, accounting and financial controls,
promoting an effective control at a reasonable cost and proposing measures that present themselves
as necessary to prevent possible deficiencies in the internal control system. Its function also includes
assuring the full compliance with legislation and regulations affecting the organization.
The department for Internal Audit has set an annual plan where it was determined the audits that
should be carried out in order to assess the quality of the control processes that certify the compliance
of the objectives of the Internal Control System, namely those that certify the operation efficiency, the
reliability of the financial and operational reports and the compliance with laws and regulations. The
___________________________________________________________________________________________
120
2013/2014
___________________________________________________________________________________________
failures in the internal control will be reported to the upper rank and the most severe to the Board of
Directors.
55. Main elements in the internal control and risk management systems implemented in the
company regarding the process of disclosing financial information
Regarding the risk control in financial reporting process, only a very limited number of collaborators of
FC Porto - Futebol, SAD is involved in the financial reporting process.
All those involved in the financial analysis of the Company are deemed to have access to privileged
information and to be particularly aware of their obligations and the sanctions resulting from the
misuse of such information.
The system of internal control in the areas of accounting and preparation and report of financial
information is based on the following key elements:
•
•
•
•
•
•
•
•
The use of accounting principles, detailed throughout the notes to the financial statements,
constitutes one of the bases of the control system;
The plans, procedures and records of the Company and its subsidiaries enable reasonable
assurance that only properly authorized transactions are recorded and that these transactions
are recorded in accordance with generally accepted accounting principles;
Financial information is analysed, in a systematic and orderly manner, by the management of
operating units, ensuring ongoing monitoring and the respective budgetary control;
During the process of preparing and reviewing financial information, a schedule of closing
accounts is provided in advance and shared with the different areas involved, and all
documents are reviewed in depth;
At the level of individual financial statements of the various companies in the group, the
accounting records and the preparation of financial statements are provided by administrative
and accounting services. The financial statements are prepared by statutory auditors and
reviewed by the financial management of each subsidiary;
The consolidated financial statements are prepared quarterly by the consolidation team. This
process represents an additional control element of the reliability of financial reporting,
namely ensuring the uniform application of accounting principles and procedures of cutting
operations as well as the verification of balances and transactions between companies in the
group;
The consolidated financial statements are prepared under the supervision of the CFO. The
documents forming the annual report are sent for review and approval by the Board of
Directors. After approval, the documents are sent to the External Auditor, which emits its Legal
Certification of Accounts and the Audit Report; and
The process of preparing the individual and consolidated financial information and the
Management Report is supervised by the Audit Committee and the Board of Directors. On a
quarterly basis, these bodies gather and analyse the individual and consolidated financial
statements of the Company.
Concerning risk factors that may materially affect the accounting and financial reporting, we
emphasize the use of accounting estimates that are based on the best information available at the
date of preparation of the financial statements as well as the knowledge and experience of past and /
or present events. We emphasize also the balances and transactions with related parties: in the group
___________________________________________________________________________________________
121
2013/2014
___________________________________________________________________________________________
FC Porto, balances and transactions with related parties mainly refer to current operating activities of
the companies in the group, as well as the granting and obtaining of loans bearing interest at market
rates.
The Board, in conjunction with the Audit Committee, regularly examines and supervises the
preparation and disclosure of financial information, in order to circumvent the access, improper and
untimely, of third parties, to relevant information.
IV. Support to the Investor
56. Service responsible for investor relations, composition, functions, information provided by these
services and elements for contact
The representative of FC Porto - Futebol, SAD for relations with the capital market is the main contact
for all investors, institutional and private, national and international.
This representative ensures the provision of all relevant information regarding relevant events,
applicable facts and relevant facts, disclosure of quarterly results and answer to any clarification
requests by investors or the general public about financial information of a public nature. He is also
responsible for all matters pertaining to the relationship with the Committee on Securities Market, to
ensure the timely fulfilment of obligations to the supervisory authority of capital and other financial
authorities. He is also responsible for developing and maintaining the webpage for Investor Relations
in the website of the Company.
For the exercise of his duties, the address, phone and fax number and e-mail of the representative for
market relations are the following:
Address: Estádio do Dragão, Via FC Porto, Entrada Poente, piso 3, 4350-451 Porto
Phone: 22 5070500
Telefax: 22.5506931
E-Mail: fernando.santos.gomes@fcporto.pt
57. Representative for market relations
The current representative of FC Porto - Futebol, SAD for market relations Fernando Manuel Santos
Gomes, member of the Board of Directors.
58. Information on proportion and response time to information requests received during the year
or outstanding from previous years
When necessary, the representative of market relations ensures the provision of all relevant
information regarding relevant events, applicable facts and relevant facts, disclosure of quarterly
results and answer to any clarification requests by investors or the general public about financial
information of a public nature. All information requested by investors is analysed and answered in a
maximum of five working days.
___________________________________________________________________________________________
122
2013/2014
___________________________________________________________________________________________
V. Website
59. Addresses(s)
FC Porto - Futebol, SAD has an internet website (www.fcporto.pt) with a wide range of information
about the Group. The aim is to provide to interested parties a general knowledge of the Group, its
business areas, information of institutional and financial nature. In the webpage dedicated to Investor
Relations, there is frequent presentation of results, documents of accountability, information on
General Meetings of shareholders, including summons and supporting documentation, and
information of institutional nature, namely the Statutes and the identification of Governing Bodies. It
is also possible to consult qualified holdings, all the privileged information and other communications
issued by the Company as well as the minutes of the General Meetings since 2009.
60. Address where information about the firm, its listed company, registered office and other
elements mentioned in Article 171 of the Companies Act can be found
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/futebol-clube-do-porto-futebol-sad.aspx#ancora_topo
61. Address with the statutes and regulations of the functioning of the bodies and/or commissions
N.a.
62. Address with information about the identity of the corporate officers, the representative for
market relations, the Office for Support to the Investor or equivalent, respective roles structure and
means of access
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/futebol-clube-do-porto-futebol-sad.aspx#ancora_topo
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/contactos.aspx#ancora_topo
63. Address with accountability documents, which must be accessible for at least five years, as well
as the biannual calendar of corporate events, at the beginning of each semester, including, among
others, general meetings, disclosure of annual, semi-annual and, if applicable, quarterly accounts
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/r-c-2013-2014.aspx#ancora_topo
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/calendario.aspx#ancora_topo
64. Address with the summon for a General Meeting and all the preparatory and subsequent
information related to it
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/ag-2014.aspx#ancora_topo
65. Address with the historical record of resolutions approved at general meetings of the company,
the represented share capital and the voting results, with reference to the previous 3 years
http://www.fcporto.pt/pt/clube/grupo-fc-porto/Pages/ag-2014.aspx#ancora_topo
___________________________________________________________________________________________
123
2013/2014
___________________________________________________________________________________________
D. REMUNERATIONS
I. Competence for determination
66. Indication as to the competence to determine the remuneration of corporate bodies
The body responsible for conducting the performance evaluation of Executive Directors for the
purpose of remuneration is the Remuneration Committee, which follows the criteria it sees fit in every
moment, complying with legal and statutory standards.
II. Remuneration Committee
67. Composition of the Remuneration Committee, including identification of contracted individual
or collective persons to provide them support and statement on the independence of each of the
members and advisors
The current Remuneration Committee of FC Porto - Futebol, SAD (from 2012 to 2015) is composed of
the following members:
•
•
•
Alípio Dias (Chairman)
Fernando Freire de Sousa
Joaquim Manuel Machado Faria de Almeida
The Remuneration Committee is composed of independent members from the Board. To this extent,
the Remuneration Committee does not include any member of another corporate body to which it
sets its remuneration, and none of the three members in office has any family relationship with other
members of these governing bodies, as their spouses or relatives in a straight line to the 3rd degree.
During the financial year of 2013/2014, the Remuneration Committee did not deem as necessary
contracting services to assist in carrying out its functions.
68. Knowledge and experience of the members of the remuneration committee on remuneration
policy
The members of the Remuneration Committee have knowledge and experience in matters of
remuneration policy.
FC Porto - Futebol, SAD believes that the experience and professional careers of the members of the
Remuneration Committee allow them to perform their duties accurately and efficiently. Additionally,
whenever necessary, that committee will recur to specialized resources, internal or external, to
support their decisions.
___________________________________________________________________________________________
124
2013/2014
___________________________________________________________________________________________
III. Remuneration structure
69. Description of the remuneration policy of the management and supervisory bodies referred to
in Article 2 of Decree n. 28/2009, of the 19th of June
As stipulated in Decree n. 28/2009, of the 19th of June, there is an annual submission to the General
Assembly of a statement on the remuneration policy of the management and supervision bodies.
The policy on remuneration and compensation of corporate bodies of FC Porto - Futebol, SAD,
approved by the General Assembly on the 21st of November, 2013, is as follows:
The Remuneration Committee, which is responsible for setting the remuneration policy of the Board
of Directors, submits to the General Assembly the following statement of principles:
• Members of the Board of Directors should perform their duties diligently and prudently in the
interests of the company, taking into account the interests of its shareholders, employees and
other stakeholders;
•
It is the interest of the company and its shareholders to set a remuneration policy that creates
adequate conditions and procedures to allow the performance of the members of the Board
of Directors to align with the criteria previously defined;
•
The performance and setting should consider, first, the level of compensation currently
practiced, and, secondly, must be conditioned by the degree of achievement of the strategic
objectives for the company.
Taking into account the principles listed above, the Remuneration Committee proposes to the General
Meeting a remuneration model based on a fixed monthly component and possible also fixed annual
bonuses, which will ensure a remuneration that rewards Executive Directors for the performance of
the Company. At the beginning of each term (every 4 years), the Compensation Committee establishes
the general parameters of remuneration of the Board of Directors, with the aim of making it more
competitive in the market and serve as a motivating element for high individual and collective
performance.
The Remuneration Committee considers that the remuneration of the executive members of the Board
of Directors of the Company shall be fixed in the month of June each year with effect staring on the
following month of July, taking into account the sporting results achieved. The executive members of
the Board of Directors of the Company may also be assigned fixed annual bonuses. The remunerations
of members of the board are not dependent on the evolution of the price of the issued shares or of
any other variable, including the profits made each year.
The Remuneration Committee also intends to point out to shareholders that there is no type of plan
of attribution of shares or acquirement of shares to the Directors. Likewise, there is no policy or
measure defined in the sense of granting compensation negotiated by contract, in the event of
termination of service or early retirement. Beyond any fixed annual bonus, there are no explicit
premiums or non-cash benefits.
Regarding the Company of Statutory Auditors of the Company, their remuneration is made through
the contract for provision of audit services to the Group Futebol Clube do Porto, which covers nearly
all of its subsidiaries. The planned remuneration is in line with market practices.
___________________________________________________________________________________________
125
2013/2014
___________________________________________________________________________________________
Members of other corporate bodies: the General Meeting, Audit Board, Company Secretary; Advisory
Board and Remuneration Committee are not remunerated for these duties at FC Porto - Futebol, SAD.
70. Information on how remuneration is structured so as to align the interests of members of the
board with the long-term interests of company, as well as on how it is based on performance
assessment and how it discourages taking extreme risks
The remuneration policy for executive directors intends to ensure proper and rigorous consideration
of the performance and contribution of each director to the organization's success, by aligning the
interests of executive directors with those of shareholders and the Company.
Proposals for remuneration of executive directors are made, taking into account the functions
performed at FC Porto - Futebol, SAD and in its different subsidiaries; responsibility and added value
by individual performance; knowledge and experience gained on the job; the financial position of the
Company; the remuneration in companies of the same sector and other companies listed on NYSE
Euronext Lisbon. Regarding the latter point, the Remuneration Committee takes into account the limits
of available information, all national companies of equivalent size, namely listed on the NYSE Euronext
Lisbon, and also companies in international markets with characteristics equivalent to FC Porto Futebol, SAD.
71. Reference to the existence of a variable remuneration component and information about
possible impact of performance evaluation on this component
The remuneration of the members of the Board of Directors of the company has not foreseen for the
existence of variable components.
72. Deferment of payment of the variable remuneration component, specifying the period of
deferment
The remuneration of the members of the Board of Directors of the company does not foresee the
existence of variable components.
73. Criteria followed when setting the variable remuneration in shares
existence of variable components. There was no sort of plan to attribute shares or allow for the
acquisition of shares to the Directors.
74. Criteria followed when setting the variable remuneration in options
existence of variable components. There was no sort of plan to attribute shares or allow for the
acquisition of shares to the Directors.
___________________________________________________________________________________________
126
2013/2014
___________________________________________________________________________________________
75. Main parameters and grounds for any system of annual bonuses and other non-cash benefits
FC Porto - Futebol, SAD does not have any system of annual bonuses or other non-cash benefits.
76. Main features of supplementary pension or early retirement plans for directors and date they
were approved in general meeting, in individual terms
The Company has not established any plans to attribute shares or allow for the acquisition of shares
or retirement benefit systems options, to members of the board of directors, and, as such, they were
never brought to the attention of the General Assembly.
IV. Disclosure of remunerations
77. Indication of the annual amount of the remuneration, in aggregate and individually, of the
members of the management bodies of the company, coming from the company, including fixed and
variable remuneration and, for the latter, mentioning the different components that led to it
The remunerations attributed to the Board of FC Porto – Futebol, SAD during this financial year reached
2.297.500 euros and are fully paid.
The gross earnings in the year in question, by all the members of the board, relates exclusively to the
executive directors.
Director
Angelino Cândido Sousa Ferreira
Fix
520,000
287,000
287,000
225,500
82,000
0
Prizes
320.000
192.000
192.000
192.000
0
0
78. Amounts paid by other companies in dominion or group, or which are subject to a common
domain
The members of the Board of Directors are not remunerated by other companies in the group or by
companies controlled by shareholders with qualified holdings.
79. Remuneration paid in the form of profit sharing and/or payment of premiums and the reasons
why these bonuses or profit sharing were granted
During the exercise, no remunerations were paid by way of profit sharing or in the form of prizes.
___________________________________________________________________________________________
127
2013/2014
___________________________________________________________________________________________
80. Compensation paid or owed to former executive directors leaving their duties during the year
During the exercise, no amounts were paid or owed relating to compensation to directors whose
functions have ceased.
81. Indication of the annual amount of remuneration, in aggregate and individually, of members of
the supervision bodies of the company
Members of the Audit Board are not remunerated for these duties at FC Porto - Futebol, SAD.
82. Details on the remuneration in the reference year of the chairman of the general meeting
The Chairman of the General Assembly is not paid for these duties at FC Porto - Futebol, SAD.
V. Agreements with implications on remunerations
83. Contractual limitations provided for compensation payable for unfair dismissal of directors and
its relation with the variable remuneration component
The remuneration policy maintains the principle of not contemplating compensations to directors, or
members of other governing bodies, associated with the early termination of duties or the expiry of
their terms, subject to compliance by the Company with legal provisions in force in this field.
84. Reference to the existence and description, indicating the sums involved, of agreements
between the company and members of the board of directors and managers, under the terms of
paragraph 3 of article 248-B of the Portuguese Securities Code, which provide for compensation in
case of dismissal without cause or termination of contract following a change of control of the
company
There are no agreements between the Company and members of the board of directors or other
managers of FC Porto - Futebol, SAD, within the meaning of paragraph 3 of article 248-B of the
Portuguese Securities Code, which provide for compensation in case of resignation, unfair dismissal or
termination of contract following a change of control of the Company. No agreements are foreseen
with the directors to ensure any compensation in the event of non-renewal of the mandate.
VI. Plans to attribute shares or allow for the acquisition of shares (‘stock options’)
85. Identification of the plan and its recipients
The Company does not have in place any kind of Plans to attribute shares or allow for the acquisition
of shares to members of governing bodies or employees.
___________________________________________________________________________________________
128
2013/2014
___________________________________________________________________________________________
86. Characterization of the plan
The Company does not have in place any kind of Plans to attribute shares or allow for the acquisition
of shares.
87. Option rights attributable to the acquisition of shares ('stock options') to workers and employees
of the company
There are no option rights granted for the acquisition of shares to workers and employees of the
company.
88. Control mechanisms in any possible system of employee participation in capital to the extent
that the voting rights are not exercised directly by them
Not applicable as explained above.
E. TRANSACTIONS BETWEEN RELATED PARTIES
I. Control mechanisms and procedures
89. Mechanisms implemented by the Company for purposes of monitoring of transactions with
related parties
Currently, there are no established procedures or criteria to define the relevant level of significance
in business between the Company and the holders of qualifying holdings or entities who are with
them in any relationship or group, from which the intervention is required of the supervisory board.
90. Indication of the transactions that were subject to control in the reference year
No businesses or significant transactions between the Company and members of its governing bodies
(administration and supervision), holders of qualified shareholdings or companies in a control or
dominion or group were performed, except those part of the current activity, and that were carried
out under normal market conditions for similar transactions. There were no business transactions
with members of the Audit Committee. The services rendered by the Statutory Auditors of the
various audit services were approved by the Audit Committee and are detailed in paragraph 47
above.
91. Description of the procedures and criteria for intervention by the supervision body for the
purpose of preliminary assessment of the business carried out between the company and holders of
qualifying holdings or entities that are related to them
In addition to the legal requirements applicable to the activities of the Audit Committee, there were
no additional mechanisms established by the company for the purpose of preliminary assessment of
___________________________________________________________________________________________
129
2013/2014
___________________________________________________________________________________________
conducting business between the Company and holders of qualifying holdings or entities that are
related to them, in accordance with Article 20 of the Securities Code.
II. Business related elements
92. Indication of the location of accounting documents where information about the business with
related parties is made available
Information on the business with related parties can be found in Note 31 of the Attachment to
Consolidated Financial Statements and Note 28 of the Attachment to the individual accounts of the
Company.
___________________________________________________________________________________________
130
2013/2014
___________________________________________________________________________________________
PART II – EVALUATION OF THE CORPORATE GOVERNANCE
1. Identification of the code of corporate governance adopted
This report was prepared in accordance with CMVM Regulation n. 4/2013, of 1st of August and the
Code of Corporate Governance, available at www.cmvm.pt, and to summarize the key aspects of
Company management, regarding the Board of Directors, taking into account the need for
transparency on this matter and the need for communication with investors and other stakeholders.
The reporting model adopted by the Company is stipulated by paragraph 4 of Article 1 of that
Regulation and Annex I thereto.
The report meets the standards of Article 245-A of the Portuguese Securities Code and discloses, to
the principle comply or explain, the degree of compliance with the CMVM Recommendations included
in the 2013 CMVM Code of Corporate Governance.
The duties of disclosure required by Decree 28/2009 of 19th of June, by Articles 447 and 448 of the
Commercial Companies Code and CMVM Regulation n. 5/2008, dated 2nd of October 2008 are also
met.
2. Analysis of compliance with the Code of Corporate Governance adopted
FC Porto - Futebol, SAD complies with most of the CMVM recommendations relating to Corporate
Governance as follows:
CMVM CORPORATE GOVERNANCE RECOMMENDATIONS
I. VOTING AND CORPORATE CONTROL
I.1. Companies shall encourage shareholders to attend and vote at general
meetings and shall not set an excessively large number of shares required for the
entitlement of one vote, and implement the means necessary to exercise the right
to vote by mail and electronically.
I.2. Companies shall not adopt mechanisms that hinder the passing of resolutions
by shareholders, including fixing a quorum for resolutions greater than that
provided for by law.
I.3. Companies shall not establish mechanisms intended to cause mismatching
between the right to receive dividends or the subscription of new securities and
the voting right of each common share, unless duly justified in terms of long-term
interests of shareholders.
I.4. The company’s articles of association that provide for the restriction of the
number of votes that may be held or exercised by a sole shareholder, either
individually or in concert with other shareholders, shall also foresee for a
resolution
by the General Assembly (5 year intervals), on whether that statutory provision is
to be amended or prevails – without super quorum requirements as to the one
legally in force – and that in said resolution, all votes issued be counted, without
applying said restriction.
I.5. Measures that require payment or assumption of fees by the company in the
event of change of control or change in the composition of the Board and that
which appear likely to impair the free transfer of shares and free assessment by
shareholders of the performance of Board members, shall not be adopted.
II. SUPERVISION, MANAGEMENT AND OVERSIGHT
II.1. SUPERVISION AND MANAGEMENT
DEGREE OF
COMPLIANCE
REPORT
Adopted
Part I / B / I. /
b) / 12, 13
and 14
Adopted
Part I / B / I. /
b) / 13 and 14
Adopted
Part I / B / I. /
b) / 12 and 13
Adopted
Part I / B / I. /
b) / 13 and 14
Adopted
Part I / A / I. /
2, 4, 5 and 6
___________________________________________________________________________________________
131
2013/2014
___________________________________________________________________________________________
II.1.1. Within the limits established by law, and except for the small size of the
company, the board of directors shall delegate the daily management of the
company and said delegated powers shall be identified in the Annual Report on
Corporate Governance.
II.1.2. The Board of Directors shall ensure that the company acts in accordance
with its objectives and shall not delegate its responsibilities as regards the
following: i) define the strategy and general policies of the company, ii) define
business structure of the group iii) decisions considered strategic due to the
amount, risk and particular characteristics involved.
II.1.3. The General and Supervisory Board, in addition to its supervisory duties
supervision, shall take full responsibility at corporate governance level, whereby
through the statutory provision or by equivalent means, shall enshrine the
requirement for this body to decide on the strategy and major policies of the
company, the definition of the corporate structure of the group and the decisions
that shall be considered strategic due to the amount or risk involved. This body
shall also assess compliance with the strategic plan and the implementation of key
policies of the company.
II.1.4. Except for small-sized companies, the Board of Directors and the General
and Supervisory Board, depending on the model adopted, shall create the
necessary committees in order to:
a) Ensure a competent and independent assessment of the performance of the
executive directors and its own overall performance, as well as of other
committees;
b) Reflect on the system structure and governance practices adopted, verify its
efficiency and propose to the competent bodies, measures to be implemented
with a view to their improvement.
II.1.5. The Board of Directors or the General and Supervisory Board, depending on
the applicable model, should set goals in terms of risk-taking and create systems
for their control to ensure that the risks effectively incurred are consistent with
those goals.
II.1.6. The Board of Directors shall include a number of non-executive members
ensuring effective monitoring, supervision and assessment of the activity of the
remaining members of the board.
II.1.7. Non-executive members shall include an appropriate number of
independent members, taking into account the adopted governance model, the
size of the company, its shareholder structure and the relevant free float. The
independence of the members of the General and Supervisory Board and
members of the Audit Committee shall be assessed as per the law in force. The
other members of the Board of Directors are considered independent if the
member is not associated with any specific group of interests in the company nor
is under any circumstance likely to affect an exempt analysis or decision,
particularly due to:
a. Having been an employee at the company or at a company holding a
controlling or group relationship within the last three years;
b. Having, in the past three years, provided services or established commercial
relationship with the company or company with which it is in a control or group
relationship, either directly or as a partner, board member, manager or director
of a legal person;
c. Being paid by the company or by a company with which it is in a control or
group relationship besides the remuneration arising from the exercise of the
functions of a board member;
d. Living with a partner or a spouse, relative or any first degree next of kin and up
to and including the third degree of collateral affinity of board members or
natural persons that are direct and indirectly holders of qualifying holdings;
e. Being a qualifying shareholder or representative of a qualifying shareholder.
II.1.8. When board members that carry out executive duties are requested by
other board members, said shall provide the information requested, in a timely
and appropriate manner to the request.
II.1.9. The Chairman of the Executive Board or of the Executive Committee shall
submit, as applicable, to the Chair of the Board of Directors, the Chair of the
Not adopted
Part II / 2 and
Part I / B / II. /
a) / 21
Adopted
Part I / B / II. /
a) / 21
Not applicable
Not adopted
Part II / 2 and
Part I / B / II. /
c) / 29
Not adopted
Part II / 2 and
Part I / C / III.
/ 52, 54 and
55
Part I / B / II. /
a) / 18
Adopted
Not adopted
Part II / 2 and
Part I / B / II. /
a) / 18
Adopted
Part I / B / II. /
a) / 18
Adopted
Part I / B / II. /
a) / 18 and
___________________________________________________________________________________________
132
2013/2014
___________________________________________________________________________________________
Supervisory Board, the Chair of the Audit Committee, the Chair of the General
and
Supervisory Board and the Chairman of the Financial Matters Board, the
convening notices and minutes of the relevant meetings.
II.1.10. If the chairman of the board of directors carries out executive duties, said
body shall appoint, from among its members, an independent member to
ensure the coordination of the work of other non-executive members and the
conditions so that said can make independent and informed decisions or to
ensure the existence of an equivalent mechanism for such coordination.
II.2. SUPERVISION
II.2.1. Depending on the applicable model, the Chair of the Supervisory Board, the
Audit Committee or the Financial Matters Committee shall be independent in
accordance with the applicable legal standard, and have the necessary skills to
carry out their relevant duties.
II.2.2. The supervisory body shall be the main representative of the external
auditor and the first recipient of the relevant reports, and is responsible, inter
alia, for proposing the relevant remuneration and ensuring that the proper
conditions for the provision of services are provided within the company.
II.2.3. The supervisory board shall assess the external auditor on an annual basis
and propose to the competent body its dismissal or termination of the contract as
to the provision of their services when there is a valid basis for said dismissal.
II.2.4. The supervisory board shall assess the functioning of the internal control
systems and risk management and propose adjustments as may be deemed
necessary.
II.2.5. The Audit Committee, the General and Supervisory Board and the
Supervisory Board decide on the work plans and resources concerning the internal
audit services and services that ensure compliance with the rules applicable to the
company (compliance services), and should be recipients of reports made by
these services at least when it concerns matters related to accountability,
identification or resolution of conflicts of interest and detection of potential
improprieties.
II.3. REMUNERATION SETTING
II.3.1. All members of the Remuneration Committee or equivalent should be
independent from the executive board members and include at least one member
with knowledge and experience in matters of remuneration policy.
II.3.2. Any natural or legal person that provides or has provided services in the
past three years, to any structure under the board of directors, the board of
directors of the company itself or who has a current relationship with the
company or consultant of the company, shall not be hired to assist the
Remuneration Committee in the performance of their duties. This
recommendation also applies to any natural or legal person that is related by
employment contract or provision of services with the above.
II.3.3. A statement on the remuneration policy of the management and
supervisory bodies referred to in Article 2 of Law No. 28/2009 of 19 June, shall
also contain the following:
a) Identification and details of the criteria for determining the remuneration paid
to the members of the governing bodies ;
b) Information regarding the maximum potential, in individual terms, and the
maximum potential, in aggregate form, to be paid to members of corporate
bodies, and identify the circumstances whereby these maximum amounts may be
payable;
d) Information regarding the enforceability or unenforceability of payments for
the dismissal or termination of appointment of board members.
II.3.4. Approval of plans for the allotment of shares and/or options to acquire
shares or based on share price variation to board members shall be submitted to
the General Meeting. The proposal shall contain all the necessary information in
order to correctly assess said plan.
Part I / B / II. /
b) / 23
Not adopted
Part II / 2 and
Part I / B / II. /
a) / 18
Adopted
Part I / B / III.
/ a) / 32
Adopted
Part I / B / III.
/ c) / 38
Adopted
Part I / B / V.
/ 45
Not adopted
Part I / B / III.
/ c) / 38
Not applicable
Part I / C / III.
/ 50
Adopted
Part I / D / II.
/ 67 and 68
Adopted
Part I / D / II.
/ 67
Adopted
Part I / D / III.
/ 69
Not applicable
Part I / D / III.
/ 73 and 74
___________________________________________________________________________________________
133
2013/2014
___________________________________________________________________________________________
II.3.5. Approval of any retirement benefit scheme established for members of
corporate members shall be submitted to the General Meeting. The proposal
shall contain all the necessary information in order to correctly assess said system.
III. REMUNERATION
III.1. The remuneration of the executive members of the board shall be based on
actual performance and shall discourage taking on excessive risk-taking.
III.2. The remuneration of non-executive board members and the remuneration of
the members of the supervisory board shall not include any component whose
value depends on the performance of the company or of its value.
Not applicable
Part I / D / III.
/ 76
Adopted
III.3. The variable component of remuneration shall be reasonable overall in
relation to the fixed component of the remuneration and maximum limits should
be set for all components.
III.4. A significant part of the variable remuneration should be deferred for a
period not less than three years, and the right of way payment shall depend on
the continued positive performance of the company during that period.
III.5. Members of the Board of Directors shall not enter into contracts with the
company or with third parties which intend to mitigate the risk inherent to
remuneration variability set by the company.
III.6. Executive board members shall maintain the company's shares that were
allotted by virtue of variable remuneration schemes, up to twice the value of the
total annual remuneration, except for those that need to be sold for paying taxes
on the gains of said shares, until the end of their mandate.
III.7. When the variable remuneration includes the allocation of options, the
beginning of the exercise period shall be deferred for a period not less than three
years.
III.8. When the removal of board member is not due to serious breach of their
duties nor to their unfitness for the normal exercise of their functions but is yet
due on inadequate performance, the company shall be endowed with the
adequate and necessary legal instruments so that any damages or compensation,
beyond that which is legally due, is unenforceable.
IV. AUDITING
IV.1. The external auditor shall, within the scope of its duties, verify the
implementation of remuneration policies and systems of the corporate bodies as
well as the efficiency and effectiveness of the internal control mechanisms and
report any shortcomings to the supervisory body of the company.
IV.2. The company or any entity with which it maintains a control relationship
shall not engage the external auditor or any entity with which it finds itself in a
group relationship or that incorporates the same network, for services other
than audit services. If there are reasons for hiring such services - which must be
approved by the supervisory board and explained in its Annual Report on
Corporate Governance - said should not exceed more than 30% of the total value
of services rendered to the company.
IV.3. Companies shall support auditor rotation after two or three terms whether
four or three years, respectively. Its continuance beyond this period must be
based on a specific opinion of the supervisory board that explicitly considers the
conditions of auditor’s independence and the benefits and costs of its
replacement.
V. CONFLICTS OF INTEREST AND RELATED PARTY TRANSACTIONS
V.1. The company's business with holders of qualifying holdings or entities with
which they are in any type of relationship pursuant to article 20 of the
Portuguese Securities Code, shall be conducted during normal market conditions.
V.2. The supervisory or oversight board shall establish procedures and criteria that
are required to define the relevant level of significance of business with holders of
qualifying holdings - or entities with which they are in any of the relationships
described in article 20/1 of the Portuguese Securities Code – thus significant
relevant business is dependent upon prior opinion of that body.
VI. INFORMATION
Not applicable
Part I / D / III.
/ 70
Part I / D / III.
/ 69 and Part I
/ D / IV. / 78,
81 and 82
Part I / D / III.
/ 69
Adopted
Not applicable
Part I / D / III.
/ 69
Adopted
Part I / D / III.
/ 71
Not applicable
Part I / D / III.
/ 73 and 74
Not applicable
Part I / D / III.
/ 74
Adopted
Part I / D / III.
/ 69 and Part I
/ D / V. / 83
Adopted
Part I / B / III.
/ c) / 38
Adopted
Part I / D / IV.
/ 41 and Part I
/ D / V. / 47
Adopted
Part I / D / V.
/ 44
Adopted
Part I / E / I. /
90
Not adopted
Part II / 2 and
Part I / E / I. /
91
___________________________________________________________________________________________
134
2013/2014
___________________________________________________________________________________________
VI.1. Companies shall provide, via their websites in both the Portuguese and
English languages, access to information on their progress as regards the
economic, financial and governance state of play.
VI.2. Companies shall ensure the existence of an investor support and market
liaison office, which responds to requests from investors in a timely fashion and a
record of the submitted requests and their processing, shall be kept.
Adopted
Part I / C / V.
/ 59 to 65
Adopted
Part I / C / IV.
/ 56 to 58
Recommendations II.1.1., II.1.4., II.1.5., II.1.7., II.1.10., II.2.4. e V.2. are not fully adopted by FC Porto –
Futebol, SAD, as explained below.
• Recommendation II.1.1.: The directors of FC Porto – Futebol, SAD focus their activity in the
management of participations of the Group and in the definition of strategic development
lines. The decisions regarding strategic and relevant matters are adopted by the Board of
Directors as a composed college body by all members, executive and non-executive, in the
normal performance of their duties. Additionally, some of the directors of the Company are in
the Board of Directors of other operational units in the Group, which means the
recommendation is not fully followed.
• Recommendation II.1.4.: FC Porto – Futebol, SAD believes that, given its size, the only
indispensable specialized commission to the needs of the Company in the Remuneration
Committee, not presenting any committees with the specific purpose of identifying candidates
to directors and to reflect on the adopted governing system, for which the recommendation
cannot be considered adopted.
• Recommendations II.1.5.: In this report, there is a description of the most important aspects
in the risk management that were implemented in the Group. However, FC Porto – Futebol,
SAD does not have a system for internal control and risk management to include all the
components foreseen in that type of system, for which the recommendation is not fully
adopted.
• Recommendations II.1.7. and II.1.10.: the members of the Board of Directors are not
independent, as all, with the exception of Rui Ferreira Vieira de Sá, are part of the Board of
Futebol Clube do Porto, holder of around 40% of the capital of Futebol Clube do Porto –
Futebol, SAD, having a dominant influence over it. Rui Ferreira Vieira de Sá is in the Board of
Directors of Somague Engenharia, SA, which is owned 100% by Somague, S.G.P.S., S.A., which
in turn is owned 100% by Sacyr SYV, a company that owns 18,79% of the social capital of
Futebol Clube do Porto – Futebol, SAD. Considering the company model adopted and the
composition and functioning of its governing bodies, namely the independence of audit
bodies, without any delegation of competence between that or any other committees, the
Group believes that appointing independent directors would not add any benefits to the
proper functioning of the model adopted, which has been proving to be adequate and
efficient.
• Recommendations II.2.4.: Even if the Audit Committee does not have any responsibilities in
the creation and functioning of internal control systems, it does take into consideration their
existence and efficiency when analysing the risks to the Company.
• Recommendation V.2.: Currently, there are no procedures or criteria regarding the definition
of relevant level of significance of businesses between the Company and holders of qualified
participations, or entities that are under any type of dominion or group, for which it would be
required an intervention of the audit body. However, the transactions with directors of FC
Porto – Futebol, SAD, or with companies related to the group or dominion represented by the
director, regardless of the amount, should be previously cleared by the Board of Directors,
properly accepted by the audit body, under the terms of art. 397 of the Portuguese Companies
Code.
___________________________________________________________________________________________
135
2013/2014
___________________________________________________________________________________________
3. Other information
Futebol Clube do Porto – Futebol, SAD believes that, despite the only partial compliance with the
recommendations of CMVM, as explained above, the degree of adoption if still wide and complete.
___________________________________________________________________________________________
136
2013/2014
___________________________________________________________________________________________
D. Shares held by members of the Board of Directors and Advisory Council
Board of Directors
Had 206.000 shares as off the 30th of June 2013. By then, further 44.000 shares were acquired, making
a total of 250.000 shares as off the 30th of June 2014. According to n. 7 of article 14 of the Regulation
of CMVM 5/2008, we disclose the operations carried out between 1st of July 2013 and the 30th of
June 2014:
Hour
15:30
15:54
15:30
15:30
15:30
15:30
15:30
15:30
15:30
15:30
15:30
10:30
10:30
10:30
10:30
15:30
15:30
15:30
15:30
15:30
15:30
15:30
15:30
10:30
15:30
15:30
15:30
15:30
15:30
15:30
15:30
10:30
15:30
15:30
15:30
15:30
15:30
15:30
Market Date
08-08-2013
08-08-2013
11-11-2013
11-11-2013
11-11-2013
11-11-2013
02-01-2014
02-01-2014
02-01-2014
02-01-2014
08-01-2014
10-01-2014
15-01-2014
15-01-2014
15-01-2014
16-01-2014
16-01-2014
16-01-2014
16-01-2014
29-01-2014
29-01-2014
18-02-2014
18-02-2014
20-02-2014
20-02-2014
03-03-2014
03-03-2014
03-03-2014
04-03-2014
04-03-2014
04-03-2014
08-05-2014
08-05-2014
08-05-2014
08-05-2014
08-05-2014
08-05-2014
13-05-2014
Operation
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Amount
10
3.990
542
975
40
8.443
1
20
1.500
8.479
3.196
20
40
100
859
341
100
3.000
59
386
614
1
10
500
250
906
170
924
50
198
1.000
40
10
1
100
50
839
3.999
Price
0,3200
0,3200
0,3700
0,3700
0,3700
0,3700
0,4000
0,4000
0,4000
0,4000
0,4000
0,4000
0,4100
0,4100
0,4100
0,4400
0,4400
0,4400
0,4400
0,4200
0,4200
0,4200
0,4200
0,4400
0,4400
0,4400
0,4400
0,4400
0,4400
0,4400
0,4400
0,5200
0,5700
0,5700
0,5700
0,5700
0,5700
0,5800
Amount
(in Euros)
3,20
1.276,80
200,54
360,75
14,80
3.123,91
0,40
8,00
600,00
3.391,60
1.278,40
8,00
16,40
41,00
352,19
150,04
44,00
1.320,00
25,96
162,12
257,88
0,42
4,20
220,00
110,00
398,64
74,80
406,56
22,00
87,12
440,00
20,80
5,70
0,57
57,00
28,50
478,23
2.319,42
Balance
206.010
210.000
210.542
211.517
211.557
220.000
220.001
220.021
221.521
230.000
233.196
233.216
233.256
233.356
234.215
234.556
234.656
237.656
237.715
238.101
238.715
238.716
238.726
239.226
239.476
240.382
240.552
241.476
241.526
241.724
242.724
242.764
242.774
242.775
242.875
242.925
243.764
247.763
___________________________________________________________________________________________
137
2013/2014
___________________________________________________________________________________________
15:30
15:30
15:30
15:30
15:30
13-05-2014
13-06-2014
13-06-2014
13-06-2014
13-06-2014
Buy
Buy
Buy
Buy
Buy
1
1.835
200
200
1
0,5800
0,5400
0,5400
0,5400
0,5400
0,58
990,90
108,00
108,00
0,54
247.764
249.599
249.799
249.999
250.000
Futebol Clube do Porto, of which he is Chairman of the Board, held, on the 30th of June 2014, 6.000.000
shares.
No shares held. Futebol Clube do Porto, of which he is Vice-Chairman of the Board, held, on the 30th
of June 2013, 6.000.000 shares.
No shares held. Futebol Clube do Porto, of which he is Vice-Chairman of the Board, held, on the 30th
of June 2014, 6.000.000 shares.
Reinaldo da Costa Teles Pinheiro
Had 9,850 shares as off the 30th of June 2013. Has not acquired or alienated any share since, and, as
off the 30th of June 2014, had the same number of shares, 9,850. Futebol Clube do Porto, of which he
is Vice-Chairman of the Board, held, on the 30th of June 2013, 6,000,000 shares.
No shares held.
Audit Committee
Had 100 shares as off the 30th of June 2013. Has not acquired or alienated any share since, and, as of
the 30th off June 2014, had the same number of shares, 100.
No shares held.
Had 10 shares as off the 30th of June 2013. Has not acquired or alienated any share since, and, as of
the 30th off June 2014, had the same number of shares, 10.
Statutory Auditors
Deloitte & Associados, SROC S.A. represented by António Manuel Martins Amaral
No shares held.
___________________________________________________________________________________________
138

Annual Report 2013-2014

Transcription

Similar documents

Sustainability and environmental care in the anastylosis and

TOO LATE - Supersudaca

Porto Kalamaki Hotel

BR-101 Conference Call

Villa Seaview Porto Cervo Guests: 12 Bedroom: 6+1

Hôtel San Giovanni

Apartment in Ksenija, Porto Montenegro

airport shuttle

Immobiliare Brunati - Brochure Ref: PC - 98