IMPORTANT NOTICES
IMPORTANT: You must read the following disclaimer before continuing. The
following disclaimer applies to the attached prospectus in respect of the share capital
increase with pre-emptive rights (the “Rights Issue”) of Pescanova, S.A. (“Pescanova”)
delivered to you in Spanish together with a translation into English for information
purposes (“Folleto Informativo”, the “Prospectus”), whether received by e-mail, accessed
from an internet page or otherwise received as a result of electronic communication and
you are therefore advised to read this disclaimer page carefully before reading, accessing
or making any other use of the attached Prospectus. In accessing the attached Prospectus,
you agree to be bound by the following terms and conditions, including any modifications
to them from time to time, each time you receive any information from us as a result of
such access.
You acknowledge that this electronic transmission and the delivery of the attached
Prospectus is confidential and intended for you only and you agree you will not
forward, reproduce or publish this electronic transmission or the attached
Prospectus to any other person.
IF YOU ARE NOT THE INTENDED RECIPIENT OF THIS MESSAGE, PLEASE
DO NOT DISTRIBUTE OR COPY THE INFORMATION CONTAINED IN THIS
E-MAIL, BUT INSTEAD DELETE AND DESTROY ALL COPIES OF THIS EMAIL.
This Prospectus has been sent to you in an electronic form. You are reminded that
documents transmitted via this medium may be altered or changed during the process of
transmission and consequently neither Pescanova, S.A. (the “Pescanova”), nor any person
who controls, or is a director, officer, employee or agent of it, nor any affiliate of any such
person accepts any liability or responsibility whatsoever in respect of any difference
between the Prospectus distributed to you in electronic format and the hard copy version
available to you on request from Pescanova.
You are responsible for protecting against viruses and other destructive items. Your
receipt of this electronic transmission is at your own risk and it is your responsibility to
take precautions to ensure that it is free from viruses and other items of a destructive
nature.
Confirmation of Your Representation: In order to be eligible to view this Prospectus,
you must not be located in the United States. You have been sent the attached Prospectus
on the basis that you have confirmed to Pescanova, being the sender of the attached, that
(A) (i) you and any customers you represent are not located in the United States and (ii)
the electronic mail (or e-mail) address to which it has been delivered is not located in the
United States and (B) you are not resident in Canada, Australia or Japan.
No registration statement relating to these securities has been filed with the U.S. Securities
and Exchange Commission. Nothing in this electronic transmission constitutes an offer of
securities for sale in the United States or any other jurisdiction. Any securities to be issued
will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities
Act”) or any state securities laws and may not be offered or sold in the United States
unless registered under the Securities Act and applicable state securities laws, or pursuant
to an exemption from such registration.
In addition, in order to be eligible to view this e-mail and/or access the Prospectus or make
an investment with respect to the securities described therein, you must either be (A) a
person who is outside the United Kingdom or (B) an investment professional falling
within Article 19(1) of the Financial Services and Markets Act 2000 (Financial Promotion)
Order 2005 (the “Order”) or (C) a high net worth entity, or any other person to whom this
Prospectus may be lawfully communicated, falling within Article 49(1) of the Order.
NOTHING IN THIS ELECTRONIC TRANSMISSION CONSTITUTES AN OFFER
TO SELL OR THE SOLICITATION OF AN OFFER TO BUY, NOR SHALL
THERE BE ANY SALE OF SECURITIES, IN ANY JURISDICTION WHERE
SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL.
You are reminded that the attached Prospectus has been delivered to you on the basis that
you are a person into whose possession this Prospectus may be lawfully delivered in
accordance with the laws of the jurisdiction in which you are located and you may not nor
are you authorized to deliver this Prospectus to any other person.
The attached English translation of the Spanish Prospectus is a free translation of the
original Spanish formed by the registration document of Pescanova (the “Registration
Document”) (Annex I of Regulation (EC) no. 809/2004 of the Commission, of 29 April
2004), the share securities note (the “Securities Note”) and the summary (the
“Summary”) (Annexes III of Regulation (EC) no. 809/2004, and XXII of Commission
Delegated Regulation (EU) no. 486/2012 of 30 march 2012), approved by and registered
with the Spanish National Securities Market Commission (Comisión Nacional del
Mercado de Valores –CNMV–) on 26 June 2012 and on 10 July 2012, respectively, and
which together form the Prospectus of the Rights Issue.
In the event of any discrepancy between the English translation of the Spanish Prospectus
and the original Spanish Prospectus, the original Spanish Prospectus shall prevail.
The English translation of the Spanish Prospectus has been prepared exclusively for
information purposes.
No representation, warranty or undertaking (express or implied) is made and no
responsibility or liability is accepted by Pescanova or the Underwriters as to the accuracy
of the English translation of the Spanish Prospectus.
Investors should rely solely on the Spanish language Prospectus registered with the
CNMV when making an investment decision in relation to the securities. Nothing herein
should be construed as a recommendation or advice to invest in any securities. No
document other than the Spanish language Prospectus registered with the CNMV may be
considered as having any legal effect whatsoever in respect of the securities and the capital
increase. Copies of the Spanish language Prospectus are available on the web sites of the
CNMV (http://www.cnmv.es) and of Pescanova (http://www.pescanova.com).
The English translation of the Spanish Prospectus has not been and will not be registered
by the CNMV or by any other equivalent regulatory authority or stock exchange.
IMPORTANT INFORMATION
GENERAL
This document has been registered with the Spanish National Securities Market
Commission (Comisión Nacional del Mercado de Valores) and has not nor will be
passported into any other jurisdiction outside Spain.
The pre-emptive subscription rights and the new shares issued in the capital increase will
not be offered or sold, and no solicitation activities in respect of the pre-emptive
subscription rights or the new shares of the capital increase will be carried out, in any
jurisdiction (other than Spain) in circumstances that involve or could involve breach of the
applicable laws and regulations in such jurisdiction or the need to carry out any type of
registration with the competent securities exchange authority for that purpose.
UNITED STATES, CANADA, AUSTRALIA, JAPAN
This document and the information contained herein is not intended for release,
publication or distribution, directly or indirectly, to persons in the United States, Canada,
Australia, Japan or any other jurisdiction where the distribution of such information is
restricted by law. This document does not constitute an offer to subscribe, or solicitation of
an offer to subscribe for, securities in the United States, Canada, Australia, Japan or in any
other jurisdiction in which it is unlawful to make such an offer or solicitation.
The securities referred to herein have not been and will not be registered under the U.S.
Securities Act of 1933 (the “Securities Act”), as amended, or the securities laws of any
state of the United States or other jurisdictions. The securities may not be offered or
subscribed for in the United States (as defined in Regulation S under the Securities Act),
absent registration or an exemption from registration under the Securities or in any other
jurisdiction other than in compliance with the laws of that jurisdiction. There is no
intention to register any portion of the offering in the United States or to conduct a public
offering of securities in the United States. Each investor acquiring new shares in the
capital increase described in this document will be deemed to have represented and
warranted that such investor has not received this document or any information related to
the capital increase in the United States, is not located in the United States and is acquiring
such new shares in an “offshore transaction”, as such term is defined in Regulation S of
the Securities Act.
UNITED KINGDOM
PESCANOVA, S.A. and the Underwriters (i) have only communicated or caused to be
communicated and will only communicate or cause to be communicated any invitation or
inducement to engage in investment activity (within the meaning of Section 21 of the
Financial Services and Markets Act 2000 of England –the “FSMA”–) received by them in
connection with the issue or sale of the pre-emptive subscription rights or the new shares
subject to this document in circumstances in which Section 21(1) of the FSMA does not
apply to PESCANOVA, S.A. and (ii) have complied and will comply with all applicable
provisions of the FSMA with respect to anything done by it in relation to the pre-emptive
subscription rights or the new shares subject to this document in, from or otherwise
involving the United Kingdom.
OTHER EUROPEAN ECONOMIC AREA MEMBER STATES
Neither PESCANOVA, S.A. nor the Underwriters have offered or sold and will not offer
or sell the pre-emptive subscription rights nor the new shares subject to this document to
persons in any of the member States of the European Economic Area (“EEA”) other than
//
1
Spain except in circumstances in which there is an exemption under the Prospectus
Directive and/or applicable implementing legislation or regulations from the obligation to
make available to the public an approved prospectus prior to the making of such offer and
in any event will observe the selling restrictions set out in the Prospectus regarding the
pre-emptive subscription rights or the new shares subject to this document.
For the purposes of this provision, the expression an “offer of the securities to the public”
in relation to the pre-emptive subscription rights or the new shares subject to this
document means the communication in any form and by any means of sufficient
information on the terms of the offer and the securities to be offered so as to enable an
investor to decide to purchase or subscribe the securities, and the expression “Prospectus
Directive” means Directive 2003/71/EC of the European Parliament and of the Council, of
4 November 2003, on the prospectus to be published when securities are offered to the
public or admitted to trading and includes any relevant implementing measure in any
member State of the EEA.
//
2
SHARE REGISTRATION DOCUMENT
(ANNEX I OF REGULATION (EC) No. 809/2004 OF THE COMMISSION OF
29 APRIL 2004)
PESCANOVA
This Share Registration Document was registered in the records of the Spanish
Securities Market Commission (Comisión Nacional del Mercado de Valores) on
26 June 2012.
CONTENTS
SHARE REGISTRATION DOCUMENT (Annex I of Regulation EC No. 809/2004
of the Commission of 29 April 2004)
0. RISK FACTORS
1. PERSONS RESPONSIBLE
2. STATUTORY AUDITORS
3. SELECTED FINANCIAL INFORMATION
4. RISK FACTORS
5. INFORMATION ABOUT THE ISSUER
6. DESCRIPTION OF THE BUSINESS (OF THE COMPANY)
7. ORGANISATIONAL STRUCTURE
8. PROPERTY, PLANTS AND EQUIPMENT
9. OPERATING AND FINANCIAL REVIEW
10. CAPITAL RESOURCES
11. RESEARCH AND DEVELOPMENT, PATENTS AND LICENCES
12. TREND INFORMATION
13. PROFIT FORECASTS OR ESTIMATES
14. ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES
AND SENIOR MANAGEMENT
15. REMUNERATION AND BENEFITS
16. BOARD PRACTICES
17. EMPLOYEES
18. MAJOR SHAREHOLDERS
19. RELATED PARTY TRANSACTIONS
20. FINANCIAL INFORMATION CONCERNING THE ISSUER’S ASSETS
AND LIABILITIES, FINANCIAL POSITION AND PROFITS AND
LOSSES
21. ADDITIONAL INFORMATION
22. MATERIAL CONTRACTS
23. THIRD PARTY INFORMATION AND STATEMENTS BY EXPERTS AND
DECLARATIONS OF INTEREST
24. DOCUMENTS ON DISPLAY
25. INFORMATION ON HOLDINGS
Share Registration Document
0
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1
9
10
11
14
15
21
62
68
74
79
90
93
94
95
110
112
116
117
120
124
152
167
168
169
170
0.
RISK FACTORS OF THE ISSUER
The principal risk factors to which the PESCANOVA Group is exposed are
described below.
Although it is considered that all principal factors have been described,
additional risks or uncertainties may exist which are not currently identified
or are not considered significant and which could represent an adverse effect
in the future on the business or financial position of the PESCANOVA
Group.
0.1. RISK FACTORS SPECIFIC TO THE ISSUER
0.1.1 Risks deriving from level of debt.
Although the PESCANOVA Group can meet its current level of debt, as
explained in Section 3 of this Registration Document, reasons may exist such
as reductions in profits, investment requirements or acquisitions of other
businesses as well as increased financing or cash requirements which could
give rise to the need for an increase in debt of the PESCANOVA Group. In
this respect, consideration must further be given to the current context of
difficulty in obtaining or improving financing as a result of the economic
situation of the banking-financial sector. On 31 March 2012 total net
financial debt amounted to 832 million euros, with the ratio to EBITDA
being 4.4. The average interest rate on debt with credit institutions was
7.03%. 75% of the debt to financial institutions was subject to variable
interest rates. The three bond issues made in 2010, 2011 and 2012, in force
at the present time, were subscribed for at market interest rates current at
each time, and in all cases the rates achieved were the best possible given the
current market conditions.
At the present date the PESCANOVA Group is not in a situation of default
of its financial obligations or of any type of obligation which could give rise
to a situation of early maturity of its financial commitments.
In the event of breach of its financial obligations, lenders could demand
early payment of the principal amount of the debt and interest.
The capacity of the PESCANOVA Group to comply with financial
covenants, meet indebtedness or be able to refinance it if necessary, is
conditioned by obtaining business results and by other economic factors and
factors of the sector in which the PESCANOVA Group operates, as
described in the remaining parts of this section.
Share Registration Document
1
0.1.2 Risks deriving from impairment in value of goodwill.
Goodwill is recognised at cost, 70.8 million euros at 31 March 2012,
meaning the excess of the cost of the combination of businesses over the
holding of the parent Company in the reasonable net value of the assets,
liabilities and identifiable contingent liabilities acquired. Although goodwill
is not depreciated, its recoverable value is reviewed at least once each year,
or within a lesser period if there is an indication of loss of value. For these
purposes, calculations of recoverable value are adjusted to reasonable value
and are based on cash flow projections of the cash generating units assigned
to the goodwill. In this review, hypotheses are taken relating to future
operations, profit and loss and market situation, which involves the use of
estimates of sales, margins, percentage growth and discount rates. Since
these hypotheses are subjective, uncertainties exist and the possibility of
events occurring which could give rise to the need to reflect losses in the
book value of goodwill, which could negatively affect results for the period
and our financial ratios.
0.1.3 Interest rate risk.
Variations in interest rates modify the reasonable value of those assets and
liabilities which accrue a fixed interest rate as well as future flows from
assets and liabilities referenced to a variable interest rate, basically affecting
financial debt.
The objective of interest rate risk management is to achieve a balance in the
debt structure which permits the cost of debt to be minimised over a multiyear horizon with reduced volatility in the profit and loss account.
Depending on Group estimates and the objectives of the debt structure,
hedging operations may be carried out by contracting derivatives which
mitigate these risks. The sensitivity analysis carried out by the
PESCANOVA Group with respect to the interest rate to which it is exposed
is detailed below:
Description
Variation in interest rate
of 50 basis points
31/03/2012
P&L
Equity
31/12/2011
P&L
Equity
± 5%
± 5%
± 0.5%
± 0.5%
The reference interest rate of the debt contracted by the PESCANOVA Group
is basically the EURIBOR.
Share Registration Document
2
0.1.4 Exchange rate risk.
Exchange rate risks at 31.03.2012 basically relate to the following
transactions:
•
•
•
Debts in foreign currency in accordance with the currency rates in which
they are contracted amount to 197.3 million euros of which 172.8 million
correspond to debts in US dollars and the remaining 24.5 to various debts
in yen, meticais, Namibian dollars and Australian dollars.
Debt denominated in foreign currency contracted by Group and associate
Companies (18.4% in USD and the remainder, approximately 2.8%, in
various currencies in different countries in which the PESCANOVA
Group works).
Payments to be made in countries outside the Euro Zone as a result of
acquiring services of all types. Payment obligations in currencies other
than the euro are approximately 29% of the total.
In addition, net assets deriving from net investments made in foreign
Companies with a functional currency other than the euro (105 million
euros) are subject to exchange rate fluctuation risk on conversion of the
financial statements of these Companies in the consolidation process.
In order to mitigate the exchange rate risk, the PESCANOVA Group
attempts to bring about a balance between receipts and payments in cash of
its assets and liabilities denominated in foreign currency.
The sensitivity analysis carried with respect to the exchange rates to which
the PESCANOVA Group is exposed is as follows:
Description
Variation in the quotation of currencies
with respect to the euro of 5%
31/03/2012
P&L
Equity
31/12/2011
P&L
Equity
± 1%
± 1%
± 0.1%
± 0.1%
0.1.5 Liquidity risk.
The Group maintains a consistent liquidity policy consisting of contracting
commited credit facilities and temporary investments in sufficient amount to
meet forecast needs for a period based on the situation and expectations of
debt and capital markets.
The general situation of financial markets, particularly the banking market,
during recent months has been particularly unfavourable to credit seekers.
The Company pays permanent attention to evolution of the different factors
which can assist in the future in overcoming possible liquidity crises, and in
particular to sources of financing and their characteristics.
Pillars or reference points of liquidity Risk Management:
Share Registration Document
3
•
•
•
•
Liquidity of monetary assets: surpluses are always placed for very short
periods. Placements for periods exceeding three months require express
authorisation.
Diversification of credit line maturities and monitoring of financing and
refinancing.
Monitoring of the remaining life of financing lines.
Diversification of sources of financing.
0.1.6 Credit risk.
The principal financial assets of the Group are cash and bank balances, trade
debtors and other accounts receivable, and investments, which represent the
maximum exposure of the Group to credit risk in relation to financial assets.
The credit risk of the Group is principally attributable to its trade debts.
Amounts are shown in the Balance Sheet net of provisions for bad debts,
estimated by Group Management based on experience in previous years and
its assessment of the current economic environment.
The Group does not have a significant concentration of credit risk, with the
largest debtor not exceeding 5% of turnover, with exposure distributed
among a large number of counterparties and customers. Furthermore,
historic bad debts can be classified as very low (historically they do not
reach 0.5%), and this has not changed significantly despite the current
economic climate.
Share Registration Document
4
0.2 RISK FACTORS OF THE ISSUER’S SECTOR OF ACTIVITY
0.2.1 Risks of the general economic situation, consumption and distribution
channels.
The PESCANOVA Group is subject to some of the trends which are taking
place in the national and international market in general and in the
foodstuffs sector in particular:
• Slow-down in consumption combined with a growing move by part of
consumption towards distribution or white brands and the cheaper
product categories. Thus, according to studies by the TNS agency of the
foodstuffs sector in Spain, white brands between 1993 and 2011 have
grown from representing approximately 10% to 35% of the sector total
by value. The data which has been revealed in the media in recent
months points to the growth trend continuing, encouraged by the current
economic situation. This also leads to an increase in barriers to the
introduction of new references in distribution channels, due to the
existence of fewer consumers prepared to spend beyond what is strictly
necessary and known.
• Increase, on the one hand, in distributor concentration operations, which
increases their bargaining power with supplier companies, and, on the
other hand, insolvencies of small and medium-sized distribution
businesses, in this case leading to an increase in bad debts.
• Global increase in prices (fish, energy and transport) which gives rise to a
widespread increase in the costs of the PESCANOVA Group (see also
following section on impact on raw materials and animal food).
• The impact of the contraction in purchasing expenditure is more negative
in products of higher retail price in absolute terms, which affects some of
our products.
Although the strategy of the PESCANOVA Group is geared to
compensating for these trends in the market and also taking advantage of
some of them, it cannot be guaranteed that they will not have a material
effect on the capacity of the PESCANOVA Group to increase its sales and
margins.
0.2.2 Risks deriving from the effect of oscillations in fish prices.
The price of fish raw materials, which represents the largest component of
the cost of products on sale, is volatile and in some cases cyclical (much
historical variation). The volatility is determined by diverse factors over
which the PESCANOVA Group has no or only partial control, such as
climatic and weather changes, pathologies of fish farmed, restrictions on
import and export, use of cereals in biofuels, energy prices and impact on
transport costs, etc.
Share Registration Document
5
In Section 6.2 of this Registration Document oscillations in consumption of
frozen fish products in Spain are quantified and shown graphically, by
volume (tonnes) and value (euros), from which a trend can be seen in the
evolution of market prices for derivative fish products between 2001 and the
present time. There is no possibility of insuring the prices of fish raw
materials, since there are no futures or other markets in which this insurance
can take place.
Furthermore, and based on the specific characteristics of the markets in each
country, the capacity which operators may have to pass on increases or falls
in the price of fish to the market varies between the different countries in
which the PESCANOVA Group is present. This is also influenced by
competition from products other than fish (meat or others) of protein content
which can substitute for fish products in the event of price fluctuations.
0.2.3 Risks deriving from the existence of situations which affect foodstuffs
safety which can have a negative impact on PESCANOVA.
As a result of the sector in which the PESCANOVA Group operates, it is
subject to the general risks associated with health and welfare of consumers,
both real and those which can be caused by perceptions of consumers
themselves. These risks include evolution of consumer preferences,
nutritional concerns, the effect of adverse publicity, liability claims by
consumers, damage or contamination in products, more restrictive
legislation, etc. Likewise, the potential for sale of products could be affected
by the actions of other companies operating in the same sector if they cause
a general loss of confidence amongst consumers.
The PESCANOVA Group is subject in its production plants to numerous
regulations relating to the foodstuffs safety field, including constant
inspections both by authorities from different countries and internally
through its quality department, present in all production activities. In
addition, within the production process itself monitoring and control
systems are applied at all stages, in order to reduce and avoid the risks of
foodstuffs safety. To this must be added the regular training of plant
personnel and, with respect to the Companies making up the PESCANOVA
Group, the establishment of rigorous standards aligned to ISO 9001
standards which are certified by the Spanish Association of Standardisation
and Certification (Asociación Española de Normalización y Certificación (AENOR). Furthermore, it must be emphasised that plants of the
PESCANOVA Group in virtually all countries in which it operates comply
with ISO 9001 Standards regarding Quality systems, ISO 14000 Standards
on the environment and other specific Standards in certain countries such as
HACCP, BRC ISO 22000 in Ecuador, and PAC (AI) and (A2) IFS in Chile,
amongst others. Nevertheless, the existence cannot be prevented of a risk
factor in those products resulting from human error despite all control
elements. It must further be considered that this can occur after the
production stage as a result of unsuitable handling by a distributor or the
consumer himself.
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6
PESCANOVA products are destined for human consumption. If, despite the
multiple controls which the PESCANOVA Group establishes, they do not
reach the consumer in optimum condition, situations may occur which are
the cause of administrative, civil and even criminal liability to
PESCANOVA as well as reputational loss.
These events could give rise to the reputation, business, profit and loss,
prospects and financial, economic or equity situation of PESCANOVA
being negatively affected.
0.2.4 Risks deriving from the effect of specific regulation concerning the
environmental sector on the activities of PESCANOVA.
In Section 8.2 of this Registration Document the principal environmental
aspects which affect the PESCANOVA Group are described in greater
detail, as well as the investments and expenditure made in the
environmental field.
As with all environmental activities, and more specifically those of the
foodstuffs industry, the activities of PESCANOVA are subject to extensive
and full environmental regulation in the countries in which it operates,
which includes obtaining various licences and administrative authorisations
to engage in activities. Different administrations (legal, regional, State,
Community and supra-national) have competences in the environmental
field.
Non-compliance with environmental legislation, including failure to obtain
the requisite licences or authorisations to engage in activities, can, as the
case may be, have negative consequences for PESCANOVA. In addition,
environmental legislation is increasingly stringent, and therefore it cannot
be ruled out, as the case may be, that PESCANOVA has to incur substantial
expenditure and investment in order to comply with new legal requirements
or settle new taxes or levies of an environmental nature.
Hypothetically, this all means that PESCANOVA could need to incur
expenditure and investment or pay penalties in an amount which can be very
high, which could negatively affect the business, profit and loss, prospects
and financial, economic or equity situation of PESCANOVA.
0.2.5 Risks deriving from the effect of specific regulation of the foodstuffs
industry on the activities of PESCANOVA.
The activities of PESCANOVA, as with the whole of the foodstuffs
industry, are subject to extensive regulation in the countries in which it
operates and distributes its products. The regulation affects the production
process, packaging, storage, distribution, labelling, advertising and
commercialisation of PESCANOVA products.
If, despite the multiple controls established by the PESCANOVA Group,
any breach occurs of applicable legislation, this could have serious
Share Registration Document
7
consequences for PESCANOVA which could incur liabilities and it could
negatively affect the business, profit and loss, prospects and financial,
economic or equity situation of PESCANOVA.
0.2.6 Risks deriving from the effect of specific regulation of the fishery or fish
farming sector on the activities of PESCANOVA.
The activities of PESCANOVA are subject, in Spain, to national and
European regulation of the fishing or fish farming sector, of commercial
activity in fisheries products and foreign trade in them. Furthermore, in the
rest of the world the activities of PESCANOVA are subject to the specific
legislation of the countries and territorial waters in which it operates, as also
happens in countries where it farms fish. This legislation seeks to rationalise
the exploitation of fishery resources, fleet management and ensure the
viability of certain fish stocks, limiting the annual amounts to which fleets
have access and establish fishing ground regeneration periods.
If, despite the multiple controls established by the PESCANOVA Group,
any breach occurs of applicable regulation, this could have serious
consequences for PESCANOVA which could incur liabilities and it could
have a negative effect on the business, profit and loss, prospects and
financial, economic or equity situation of PESCANOVA, S.A.
Share Registration Document
8
1. PERSONS RESPONSIBLE
1.1 All persons responsible for the information given in the Registration
Document and, as the case may be, for certain parts of it, with, in the
latter case, an indication of such parts. In the case of natural persons
including members of the issuer’s administrative, management or
supervisory bodies, indicate the name and function of the person; in case
of legal persons, indicate the name and registered office.
Mr. Manuel Fernández de Sousa-Faro, Chairman of the Company, of legal
age, Spanish nationality and with National ID Document number 1385544 R,
currently in force, assumes responsibility for the information contained in
this Registration Document, pursuant to resolution passed by the Board of
Directors of 3 September 2010.
1.2 A declaration by those responsible for the registration document that,
having taken all reasonable care to ensure that such is the case, the
information contained in the registration document is, to the best of their
knowledge, in accordance with the facts and contains no omission likely
to affect its import.
Mr. Manuel Fernández de Sousa-Faro declares that, after acting with
reasonable care to ensure that such is the case, the information contained in
the Registration Document is, to the best of his knowledge, in accordance
with the facts and contains no omission which could affect its import.
Share Registration Document
9
2. STATUTORY AUDITORS
2.1 Names and addresses of the issuer’s auditors for the period covered by
the historical financial information (together with their membership of a
professional body).
The auditors, BDO Auditores, registered under number S-1273 in the Official
Register of Auditors of the Institute of Accounting and Auditing, with
registered office in Barcelona, at calle Elías, 29-35, carried out audits of
PESCANOVA, S.A. and its consolidated Group of undertakings in the
financial years ending 31 December 2011, 2010 and 2009.
2.2 If auditors have resigned, been removed or not been re-appointed during
the period covered by the historical financial information, indicate
details if material.
The auditors, BDO Auditores, have been auditing PESCANOVA, S.A. and its
Consolidated Group of undertakings since the year 2002 without interruption.
During the period covered by the historical financial information and up to
the date of submission of this Document, they have not resigned or been
removed from their functions.
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10
3. SELECTED FINANCIAL INFORMATION
3.1 Selected historical financial information regarding the issuer, presented
for each financial year for the period covered by the historical financial
information, and any subsequent interim financial period, in the same
currency as the financial information.
The financial information presented below relates to data on the activities of
the PESCANOVA Group to 31 December in the 2011, 2010 and 2009
financial years, based on the audited Consolidated Annual Financial
Statements, prepared in accordance with the International Financial Reporting
Standards adopted by the European Union (FIRS-EU), in accordance with
Regulation (EC) no. 1606/2002 of the European Parliament and Council
(hereinafter “FIRS”).
Section 20.1 of this Document includes the consolidated historical financial
statements of the PESCANOVA Group in relation to the 2011, 2010 and
2009 financial years, which have been audited.
An extract is shown below of the principal items from these financial
statements.
The most significant figures on the balance sheet and their evolution and
variations in the 2009 to 2011 period of the PESCANOVA Consolidated
Group are shown in the following table:
CONSOLIDATED GROUP BALANCE SHEET
Thousands of euros
Financial data
% variation
10-11
% variation
09-10
2011
2010
2009
Non-current assets
1,120,143
1,123,169
1,129,682
0%
-1%
Current assets
1,156,338
1,066,973
948,592
8%
12%
Total Assets
2,276,481
2,190,142
2,078,274
4%
5%
Equity
531,890
477,166
444,459
11%
7%
Non-current Liabilities
924,275
810,950
642,647
14%
26%
Current Liabilities
820,316
902,026
991,168
-9%
-9%
2,276,481
2,190,142
2,078,274
4%
5%
336,022
164,947
-42,576
104%
487%
Total Liabilities + Equity
Working Capital
Comments in relation to the most important figures and balances and their
variations can be found in Sections 9.2 and 20. Financial information relating
to assets and liabilities of the issuer, financial position and profit and loss.
Share Registration Document
11
CONSOLIDATED INCOME STATEMENT
Thousands of euros
GROUP PROFIT AND LOSS ACCOUNT
% variation % variation
10-11
09-10
2011
2010
2009
Operating revenue
1,701,821
1,609,397
1.496,126
5.74%
7.57%
Operating expenses
1,579,966
1,502,931
1,394,439
5.13%
7.78%
EBITDA
183,526
163,349
149,709
12.35%
9.11%
CONSOLIDATED OPERATING PROFIT
121,855
106,466
101,687
14.45%
4.70%
2,604
294
499
785.71%
-41.08%
55,397
53,507
54,388
3.53%
-1.62%
-52,793
-53,213
-53,889
-0.79%
-1.25%
-4,286
-3,569
-2,294
20.09%
55.58%
64,776
49,684
45,504
30.38%
9.19%
-13,174
-11,293
-8,412
16.66%
34.25%
51,602
38,391
37,092
34.41%
3.50%
Net profit and loss on discontinued operations
-1,181
-1,531
-4,508
-22.86%
-100%
CONSOLIDATED PROFIT FOR THE YEAR
50,421
36,860
32,584
36.79%
13.12%
281
563
493
-50.09%
14.20%
50,140
36,297
32,091
38.14%
13.11%
Financial income
Financial expenses
FINANCIAL PROFIT AND LOSS
OTHER PROFIT AND LOSS
CONSOLIDATED PRE-TAX
PROFIT
Tax on profits
Consolidated profit and loss from
continuing operations
Attributable to:
Outside shareholders
Parent company
Variations in the most significant figures from the income statements are
described in Section 20, Financial Information, relating to Assets and
Liabilities of the issuer, Financial Position and Profit and Loss.
Principal financial ratios
Thousands of euros
% variation % variation
10-11
09-10
2011
2010
2009
Gross operating profit (EBITDA) (*)
183,526
163,349
149,709
12.35%
9.11%
Net Financial Debt (**)
688,168
540,768
545,144
27.26%
-0.80%
Total Net Financial Debt
Return on Equity
(ROE = Net Profit /Net Equity)
Financial Gearing
Net Debt/Assets)
818,291
662,984
649,950
23.43%
2.01%
9.48%
7.72%
7.33%
22.72%
5.37%
30.23%
24.69%
26.23%
22.43%
-5.87%
3,8
3.31
3.64
14.79%
-9.09%
4.46
4.06
4.34
9.86%
-6.51%
Working Capital
336,022
164,947
-42,576
103.72%
487.42%
EBITDA/Turnover
10.99%
10.44%
10.16%
5.23%
2.71%
Net Financial Debt/EBITDA
Total Net Financial Debt/EBITDA
(*) EBITDA represents profit and loss of the company before tax, financial
expenses and depreciation and coincides with operating profit and loss
plus depreciation.
(**) Net financial debt includes solely financial debt with recourse.
Share Registration Document
12
3.2 If selected financial information for interim periods is provided,
comparative data from the same period in the prior financial year must
also be provided, except that the requirement for comparative balance
sheet information is satisfied by presenting the year-end balance sheet
information.
Unaudited consolidated financial information is included, in relation to the
first quarter of 2012.
BALANCE SHEET
Thousands of euros
31/03/2012
31/12/2011
Non-current Assets
1,118,793
1,120,143
-0.12%
Current Assets
1,113,680
1,156,338
-3.69%
Total Assets
2,232,473
2,276,481
-1.93%
Net Equity
525,245
531,890
-1.25%
Non-current Liabilities
911,849
924,275
-1.34%
Current Liabilities
795,379
820,316
-3.04%
2,232,473
2,276,481
-1.93%
318,301
336,022
-5.27%
Financial Data
Total Liabilities + Net Equity
Working Capital
% variation
INCOME STATEMENT
Thousands of euros
% variation
31/03/2012 31/03/2011
11-12
350,960
329,571
6.49%
38,318
34,280
11.78%
23,238
20,388
13.98%
9,042
8,553
5.72%
GROUP PROFIT AND LOSS ACCOUNT
Consolidated turnover
EBITDA
EBIT
PROFIT AFTER-TAX
Principal financial ratios 2012 (RT (running total)
31/03/2012 31/12/2011 Variation
Thousands of euros
Gross Operating Profit
(EBITDA) (*)
Net Financial Debt (**)
Total Net Financial Debt
Financial Gearing
(Net Debt/Assets)
Net Financial
Debt/EBITDA
Total Net Financial
Debt/EBITDA
Working Capital
EBITDA/Turnover
(*)
187,564
709,557
832,387
183,526
688,168
818,291
31.78%
30.23%
3.78
3.75
4.44
318,301
11.08%
4.46
336,022
10.99%
2,20%
3.11%
1.72%
-5.27%
EBITDA represents profit and loss of the company before tax, financial expenses and
depreciation and coincides with operating profit and loss plus depreciation.
(**) Net financial debt includes solely financial debt with recourse.
Share Registration Document
13
4.
RISK FACTORS
Dealt with in Section 0 of this Registration Document.
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14
5. INFORMATION ABOUT THE ISSUER
5.1 History and development of the issuer.
5.1.1 Legal and commercial name of the issuer.
The legal name of the ISSUER is PESCANOVA, S.A. (hereinafter
PESCANOVA, the ISSUER or the Company) and its commercial name is
PESCANOVA.
We will indistinctly use PESCANOVA Group, Consolidated Group or Group
to refer to its group of undertakings.
The head offices of PESCANOVA, S.A. are located at the same address as its
registered office.
5.1.2 The place of registration of the issuer and its registration number.
PESCANOVA., S.A. is registered in the Pontevedra Commercial Registry in
Book 580, Folio 215, Sheet no. PO-877.
5.1.3 The date of incorporation and length of life of the issuer, except where
indefinite.
PESCANOVA, S.A. was formed by notarised public deed executed before
the Madrid Notary Public Mr. Manuel Pardo de Vera, on 23 June 1960,
numbered 1909 in order in his records. It is registered in the Pontevedra
Commercial Registry, in Book 580, Folio 215, Sheet no. PO-877. Its duration
in accordance with Article 6 of the Articles of Association is indefinite.
5.1.4 The domicile and legal form of the issuer, the legislation under which
the issuer operates, its country of incorporation, and the address and
telephone number of its registered office (or principal place of business
if different from its registered office).
The registered office of PESCANOVA, S.A. is located at Rúa de José
Fernández López s/n, Chapela-Redondela (Pontevedra), and its telephone
number is 986 81 81 00, the latter being its principal place of business. Its
Tax ID Code is A-36603587.
PESCANOVA, S.A. is incorporated in Spain, takes the legal form of a
sociedad anónima (joint stock company), and is subject to Spanish laws
relating to this type of company. The Company adapted its Articles of
Association to current commercial legislation by notarised public deed
executed before the Vigo Notary Public Mr. Alberto Casal Rivas, on 8 March
1990, and numbered 929 in his records.
The Articles of Association can be consulted in the Pontevedra Commercial
Registry by the legal means provided for the purpose, at the registered office
of the ISSUER on prior request for the purpose, and on the corporate website
www.pescanova.com.
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PESCANOVA, S.A. is a sociedad anónima subject to the regulation
established by the current Capital Companies Act (Ley de Sociedades Capital
- “CCA”), Securities Market Legislation and other applicable provisions.
5.1.5 The important events in the development of the issuer’s business.
1960/1969
Mr. José Fernández López incorporated the joint stock company
PESCANOVA, based in Vigo.
The freezer vessels Lemos and Andrade are launched, the first fishing vessels
with on-board freezing in the world. They are successfully sent to the fishing
grounds of South Africa and Argentina.
Fishing ground research activities begin by continuous prospecting with
different vessels. Several fishing grounds of very significant species are
discovered, such as giant squid, hake and prawns.
New freezer fishing vessels are constructed, more technically sophisticated
and appropriate for the different fishing grounds.
Joint businesses are created in countries such as South Africa (Sea Harvest
Corporation), Ireland (Eiranova) and Argentina.
In the distribution field, PESCANOVA contributes to the popularisation of
frozen fish and assists commercial distributors with the introduction of chest
fridges and freezers where the end product can be suitably conserved.
The trademark PESCANOVA is born.
The fishing grounds of certain countries (Peru, Canada, etc.) begin to be
defined as exclusive economic areas, extending the territoriality of their
waters from 12 to 200 miles from the coast. In practice, this means expulsion
of a large part of the Spanish fleet without fishing permits.
1970/1979
Virtually all countries with coastlines extend their waters, defining economic
exclusivity of resources 200 miles around them.
In Spain mixed undertakings are regulated, facilitating the export of fishing
equipment and vessels and import of the fish products caught with such
vessels.
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Pursuant to the new legislation, the PESCANOVA Group grows, with new
undertakings in countries such as Mozambique (Pescamar Ltda.), Guinea
(Afripesca), Cameroon, Morocco, Uruguay (Pesquerías Belnova SA), etc.
The character Rodolfo Langostino appeared for the first time.
1980/1989
Commercial activities are expanded to Europe by the formation of trading
subsidiaries in Portugal (PESCANOVA Ltda.) and France (PESCANOVA
France).
In Spain, Frinova S.A. and Bajamar Séptima, S.A. are formed, which
construct plants for fish processing and prepared and pre-cooked products in
Galicia.
Fishing activities continue in new fishing grounds, with undertakings formed
in Chile, Argentina, Australia, Mauritania and Scotland, amongst others.
Fish farming activities begin in the PESCANOVA Group.
1990/1999
Farming of salmon in Chile, prawns in southern Spain and turbot in northern
Spain begins to bear fruit. Fish farming activities increase in these areas.
NovaNam Ltd is formed, a fishing undertaking in Namibia when it becomes
independent from the Republic of South Africa.
Polar Ltd is formed, from which squid fishing activities begin in the Falkland
Islands.
PESCANOVA Inc. is formed in the USA, as well as PESCANOVA Italia.
2000/2012
The expansion of the PESCANOVA Group leans more towards commercial
and farming areas than fishing, which up to this time has been more
traditional in growth of the firm.
Control is acquired of Pescafina (2000), in the wholesale field, Fricatamar
(2007) and Congepesca (2005), engaged in the cephalopod field,
Ultracongelados Antártida (2002), shellfish preparation in Spain, as well as
undertakings with large commercial presence in their respective countries,
such as Krustanord (2006) in France, and Ladex (2007) in the US, whilst new
commercial undertakings are formed in Japan (2006), Greece (2004), Poland
(2006), etc.
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17
In the farming field, the largest turbot projects in the world are constructed in
Mira (Portugal) and Xove (Lugo).
The development and processing is strengthened of vannamei prawns in
Nicaragua (2006), Honduras (2008), Guatemala (2008) and Ecuador (2008)
by the purchase of various prawn farming companies.
The equity structure of the PESCANOVA Group is strengthened by an
increase in capital of 100 million euros during 2009 with financial
strengthening by issues of convertible bonds carried out in 2010 in the
amount of 110 million euros, 2011 in the amount of 180 million euros and
2012 (February) in the amount of 160 million euros.
In June 2012 the Board of Directors of PESCANOVA, S.A. resolved on stock
exchange flotation in Santiago de Chile of its subsidiary Acuinova Chile,
which is the head of its salmon fish farming activities.
5.2 Investments.
5.2.1 A description (including the amount) of the issuer’s principal
investments for each financial year for the period covered by the
historical financial information up to the date of the registration
document.
Investments and disinvestments in Fixed Assets (property, plant and
equipment)
A table is included below showing net changes and their evolution in the
2009 to 2011 period.
2011
(Thousands of euros)
Land and buildings
Technical installations and
machinery
Fleet
Other fixed assets
Advances and fixed assets in
progress
Additions to the consolidation
perimeter
Total
66,847
2010
88,413
2009
78,704
27,098
8,311
44,606
1,462
31,429
-10,559
-737
6,593
-2,074
-57,062
-115,306
-16,603
-44,457
-25,768
-80,897
As indicated in Section 6, the PESCANOVA Group is based on vertical
integration, ranging from obtaining the products which it commercialises to
placement in the principal markets in Europe, America and Japan, taking in
their transformation until obtaining the desired end product. Within this
vertical integration, initial access to resources can take place either as fish
catches through its fishing fleet, or their cultivation in its different farms. The
most significant investments in fixed assets have historically been related to
the fishing fleet and in recent years with the new challenge of the Group in
relation to its fish farming efforts, to which the vast majority of investments
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18
relate, both in land, plant and equipment, as well as financial investments.
2011
During 2011 the principal investments were aimed at strengthening,
complementing and consolidating those made in previous years in connection
with fish farming, in particular that relating to the prawn projects in Ecuador,
and others for salmon in southern Chile, whilst investments in the traditional
fishing business and industrial processes were reduced to lower levels.
2010
What can be highlighted of investments in fixed assets in 2010 is that they
were much less compared with those in previous years or periods since it was
considered that the projects which required significant investment in the areas
of vannamei prawn and turbot cultivation were complete. For the first time in
recent years net investment was less than depreciation for the year.
2009
During 2009 net investment in fixed assets amounted to 81 million euros, of
which 79 million related to investment in land and buildings and 31 million to
technical installations and machinery, both principally connected with the
investments in cultivation of vannamei prawn in Central America and
Ecuador and turbot in Portugal, whilst some disinvestment took place in the
fleet through sales and other removals to a value of 10 million euros.
Reductions further occurred in advances and fixed assets in progress as a
result of them being applied to their purposes in a value of 17 million euros.
The consolidation perimeter in 2009 did not undergo significant changes, and
therefore there was no variation in fixed assets for this reason.
Investments and disinvestments in intangible assets
Variations are shown below in the intangible fixed asset accounts for the
2011 to 2009 period in the PESCANOVA Group.
(Thousands of euros)
Concessions and licences
Others
Inclusions in the
consolidation perimeter
Total
2011
1,345
-1,416
2010
7,378
1,671
2009
4,150
4,129
--71
-9,049
-8,279
In relation to other non-current assets, intangible assets are of very low
amount.
Share Registration Document
19
In 2011 variations in intangible assets were insignificant.
In 2010 the variation in intangible assets was due to increases in concessions
for the production of salmon species in Chile, IT software and research and
development.
In 2009 the increase in intangible assets was basically due to the purchase of
fishing licences in the fishing grounds of Australia and Chile, and to a lesser
extent IT applications and other lesser investments.
5.2.2 A description of the issuer’s principal investments that are in progress,
including the geographic distribution of those investments (home and
abroad) and the method of financing (internal or external).
The large investments made in previous years and which were in progress at
prior year-ends have been completed and in practice only minor items
remain. At the present time there is no investment of any scale in progress
either in Spain or abroad.
No significant variations had taken place at the date of Registration of this
Document.
5.2.3 Information concerning the issuer’s principal future investments on
which its management bodies have already made firm commitments.
There are no future investments of the issuer of significant size in respect of
which its management bodies have already adopted firm commitments.
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20
6. DESCRIPTION OF THE BUSINESS
6.1 Principal activities
6.1.1 A description of, and key factors relating to, the nature of the issuer’s
operations and its principal activities, stating the main categories of
products sold and/or services performed for each financial year for the
period covered by the historical financial information.
The corporate objects of PESCANOVA, S.A. are determined by Article 2 of
the Articles of Association, which literally reads as follows:
“The industrial operation of all activities connected with products
destined for human or animal consumption, including their production,
transformation,
distribution,
commercialisation
and
other
complementary activities or those deriving from the principal activity,
both of an industrial and commercial nature, as well as participation in
national or foreign undertakings”.
The principal activity of PESCANOVA and its Group of undertakings is
connected with the different species of seafood products and marine proteins,
their production, transformation and placement in the end market. The
principal activity of PESCANOVA, S.A. in its initial period consisted of
obtaining fish resources by fishing and their subsequent commercialisation.
Until the mid-nineteen eighties it continued this activity, combining it with
the preparation of fish and, to a lesser extent, other foodstuffs products such
as vegetables or pizzas, amongst others, by transformation of fishing products
into products of higher added value in its prepared dish or pre-cooked plants.
Until relatively recent times the activity of obtaining fish had not varied
greatly in relation to the manner in which it took place formally, from land
and with artisan systems. With the arrival of steam vessels at the beginning of
the last century, the evolution began in obtaining fish species through more
distant fishing grounds. The gradual transformation in the design of vessels
and the evolution of the technology used, in the direction of increased
performance, was extraordinary as from that time. The useful life of fish was
easily reduced, however, as a result of lack of means of conservation. Only
methods for conserving fish in salt or in ice were used. The arrival of the onboard freezing system constituted a major revolution in the conservation of
fish, and consequently in the capacity and autonomy of vessels. Before long,
all fishing grounds in the world were within the reach of the fishing industry.
PESCANOVA was the first undertaking to construct a freezer vessel to
operate long distance, the vessel Lemos in 1960, which gave rise to the birth
of the undertaking and to a technological revolution in the fishing sector,
being the ability to access remote fishing grounds and preserve the fish by
freezing it on board.
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In the nineteen seventies, coastal countries with fishing resources close to
their coastlines, unknown until that time in some cases, decreed the extension
of 12 miles of jurisdictional waters, but it was in a 1980 UN Convention
when worldwide agreement was reached to extend the Exclusive Economic
Zone for exploitation of natural resources (fauna, flora and minerals), which
has become known as the EEZ, to 200 miles.
With the extension to 200 miles of the EEZ, the first legal regulation began of
fishing grounds by coastal countries owning the resources, developing the
criteria under which fishing licences were granted in each particular country.
At a second and no less important stage, regulations began to be established
relating to the biological control of the species which inhabited their waters,
strictly defining the catches which could be made each year in order to
preserve the wealth of their waters. This regulation, which is fundamental to
preserving species, takes place by systems of temporary prohibition, study of
the available annual biomass of species and defining the total annual catch
(TAC) for each of the species, as well as other elements of their regulation
and preservation such as definition of fishing areas, and restrictions on fishing
equipment, restrictions on accompanying fauna, etc., all measures aimed at
preserving the volume and quality of the resource and at the same time
favouring a reduction in production costs in catches per unit of effort.
The PESCANOVA Group is made of a group of foodstuffs undertakings
engaged in obtaining marine protein which it receives through different
sources which include fishing,
aquaculture (fish farming) and the
commercialisation of marine products produced by third parties. The origin of
the products which it commercialises can be seen in the following chart
where it can particularly be observed that 31% of products sold by the
PESCANOVA Group come from fish farming and 65% from catches made
by vessels of the PESCANOVA Group or purchases of wild fish from third
parties. A specific characteristic of the PESCANOVA Group is vertical
integration which enables it to undertake all processes from origin to
commercialisation, maintaining the global margins generated during the
different processes within the Group. In the 2004/2009 period investments by
the PESCANOVA Group were aimed basically at marine farming processes,
maintaining its volumes of fish and/or trading which, given the maturity
period of the species cultivated (up to 30 months) enables it to be considered
that in forthcoming years the future development of the Group will mean that
the percentage of products sold originating from fish farming exceeds the
current percentage, to the detriment of the others.
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22
Origin of sales
(in Tm)
31.03.2012
32%
37%
Own fishing
Own fish farming
Trading
31%
Own fishing: Catches obtained by the PESCANOVA Group fleet.
Own fish farming: Production from cultivation, principally of vannamei
prawn, salmon species and turbot.
Trading: Portion of sales originating from other producers.
PROFIT AND LOSS BY BUSINESS UNIT
( €m)
FISH FARMING
2007
2008
2009
2010
2011
Q1 2011
Q1 2012
284.5
202.6
81.9
322.4
235.3
87.1
353.5
259.2
94.3
406.9
272.0
134.9
465.3
293.5
171.8
95.6
67.8
27.9
114.9
81.5
30.4
10.4
3.7%
0.7
0.3%
9.7
11.8%
23.7
7.4%
7.3
3.1%
16.4
18.8%
34.0
9.6%
14.9
5.7%
19.1
20.3%
45.5
11.2%
17.2
6.3%
28.3
21.0%
63.2
13.6%
29.1
9.9%
34.1
19.8%
10.4
10.9%
4.7
6.9%
5.7
20.6%
13.4
11.7%
8.9
10.9%
4.5
14.8%
TURNOVER
EBITDA
%
1,008.8
112.0
11.1%
1,020.9
114.6
11.2%
1,119.5
115.7
10.3%
1,158.0
117.8
10.2%
1,205.3
120.4
10.0%
234.0
23.9
10.2%
236.1
24.9
10.5%
TURNOVER
EBITDA
%
1,293.4
122.4
9.5%
1,343.2
138.3
10.3%
1,473.0
149.7
10.2%
1,564.8
163.3
10.4%
1,670.7
183.5
11.0%
329.6
34.3
10.4%
351.0
38.3
10.9%
TURNOVER
CRUSTACEANS
FISH
EBITDA
%
CRUSTACEANS
%
FISH
%
TRADITIONAL BUSINESS
TOTAL
 Fish farming currently represents over 1/3 of EBITDA and continues to grow at a
good rate.
Share Registration Document
23
EBITDA
200
150
100
50
0
€m
2007
2008
Traditional Business
2009
2010
2011
Fish Farming
During recent years, particularly from 2005 until 2010, investments by the
PESCANOVA Group led to the amount of fixed assets net of depreciation
growing until it almost duplicated. The majority of the investments made in
that period were in the fish farming area.
The evolution can be seen in the attached table of operating profit and
turnover from 2007 until the most recent quarter and it highlights the increase
in EBITDA in the five-year period from 2007 to 2011, from 122.4 to 183.5
million euros, a 50% increase in five years, whilst turnover grew by 29%.
These increases principally derive from the fish farming area which grew by
63% in sales and 507% in EBITDA, whilst the remaining business of the
Group, the traditional business, deriving from catches, their processing and
trading, grew by 19% and 8%, respectively. Both areas grew continuously,
particularly that connected with fish farming, as a result of the major
investments made by the PESCANOVA Group between 2005 and 2010.
Year after year, since the major investment in fish farming was completed,
both sales and EBITDA have continued to grow as a result of the maturity
periods of the species cultivated, of long cycle in the case of salmon and
turbot.
The PESCANOVA model is a vertically integrated model geared to being
able to supply, in sustainable manner, a “wide range” of products of marine
origin to a large extent under the PESCANOVA trademark.
What is important to the company is thus being able to offer a global basket
of products, some complementing others, independently of their fishery or
fish farming origin and the area of the world from which they originate. Each
product taken individually thus benefits from the possibility which
PESCANOVA can offer of covering a broad spectrum of demand.
Furthermore, however, the range variety, in certain circumstances of shortage
of one product, enables it to be substituted by another and in this manner
satisfy market requirements, avoiding loss of positioning amongst customers.
In order to be able to comply with this “mission”, the different initiatives
which have been carried out within the Group have been carried out under a
strategy of “diversification”, not only of species but also of origins and
markets. This philosophy of diversification is one of the identifying marks of
PESCANOVA and without doubt constituted the foundation for the sustained
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24
growth of the Group, avoiding situations which would have occurred if a
philosophy had been followed of mono-cultivation or concentration in a
single product. The materialisation of this strategy, independently of the fish
farming or fishing origin of the species, has taken concrete form in actions
aimed at achieving:
• More than one species per country.
• More than one country for the same species.
• More than one species per market.
• More than one market for the same species.
Diversification is a response to and is connected with type of activity; both
fishing and fish farming are activities which are highly sensitive to the
intrinsic conditions of fishing grounds, bioclimatic conditions, health factors,
etc. Thus the great importance of having alternative supplies in order to be
able to ensure continuity of the Group’s presence in markets. It is a question
of compensating not only for the natural variability of extractive potential in
fishing grounds, but also the differences which, by reason of seasonality and
geographical situation, occur in different countries. In short, diversification
enables possible changing situations, inherent in the type of activity carried
out, to be compensated for.
Investments of the PESCANOVA Group made in recent times were and are
principally aimed at the fish farming area where variable periods of time are
required, based on the species it is intended to farm, in order to reach fish
maturity. In the case of salmon, and depending on the species farmed, the
maturity period, i.e. the period necessary in order for a salmon to reach an
adequate size for sale, varies between 18 months in the case of the Pacific
salmon and 28 months in the case of the Atlantic salmon. In the case of turbot
farming, a period is needed of up to 30 months in order to obtain the best
results in terms of margin/kilo ratio, whilst in the case of vannamei prawn or
tilapia, a period of five months can be appropriate for their harvesting.
Farms raise a population of living beings and therefore their production is
subject to the oscillations inherent in this process. It is furthermore an activity
of high technological component, since fish farms are susceptible to operation
by a more or less intensive breeding and raising regime based on the technical
level of the solutions applied, from genetic selection of specimens, taking in
water oxygenation and recirculation processes, as a result of the population
density per cubic meter of water, which means that potential production
capacity in some cases, depending on the species, can vary over a very broad
range.
Furthermore, the period for raising species can extend up to two years, such
that there is a considerable lapse in time between starting operation of a farm
and commencing production. This all means that any information which can
be provided regarding the expected production capacity of the fish farming
installations of the Group after completion of the investment process and with
respect to their current degree of occupation, would necessarily include very
wide ranges and therefore could lead to confusion.
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25
PESCANOVA represents a unique business proposal and can be
distinguished from its competitors in:
Large undertakings in the list of the 10 largest by turnover of the
seafood product industry. (Own preparation with data obtained from
public information and the annual financial statements of businesses
in the sector on their most recent closing).
Vertically integrated.
Strong brands.
Fish farming: diversified and differentiated fish farming projects.
Fishing: large fishing fleet.
Reduction in risks by means of diversification by species and
geography.
50 years of uninterrupted organic growth.
In the map below the activities of the PESCANOVA Group are detailed by
nature and geographical location.
•
•
•
•
Countries coloured red: Traditional activity.
Countries coloured blue: Fish farming activity.
Countries coloured yellow: Commercial activity.
Countries with stripes on colour: Fish farming plus that inherent in the
colour.
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26
A. Activities by nature:
Fishing or extraction business
The traditional sector par excellence is catching fish in natural fishing
grounds which basically consist of fishing and preparing the frozen product
through companies located in the countries where the sources of supply are
found and in those which, in addition, the transformation costs are very
competitive. The RESOURCES-MARKETS binomial constitutes a decisive
role, combining the raw materials obtained in the southern hemisphere in
Pacific, Atlantic and Indian waters with the developed markets of the
northern hemisphere, principally in Europe, North America and Japan.
In order to achieve fishing concessions throughout the world the
PESCANOVA Group has created several businesses with local partners in
countries with abundant fishing resources. The joint businesses have shown
themselves to be a hugely useful tool, which enables the economies of these
countries to benefit from the development and utilisation of their own
resources, whilst the PESCANOVA Group manages to maintain a concession
in an almost guaranteed manner as a result of having decided to establish
itself in these countries. In this manner the PESCANOVA Group enjoys an
adequate supply of fish in order to sell to end consumers.
Fishing rights are granted by governments, whether directly to companies or
indirectly through other governments or supra-national organisations, which
distribute the fishing quotas amongst their member states.
Thanks to this policy of subsidiaries, the PESCANOVA Group has not been
substantially affected by application of the 1980 UN resolution regarding the
EEZ, by operating its vessels under the flag of the coastal countries which
own and manage the fishing grounds.
On the contrary, the PESCANOVA Group has benefitted from the more
rational exploitation of fishing banks which the new system meant and which
led to the following principal consequences:
1. Guarantee of survival of the fishing ground and its continuity as source
of supply.
2. Increase in the price of fish deriving from the reduction in supply due to
the reduction in catches.
3. Improvement in the size of fish as a result of rationalisation of their
catching, giving rise to a higher commercial return for fishing
companies.
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27
Historically, the PESCANOVA Group has dedicated a large part of its efforts
to improving the design of its vessels in order to adapt them to the evolution
of R&D processes which began with on-board freezing. Improvements in
fishing systems which have involved substantial innovations, such as
inclusion for the first time amongst Spanish fleets of the prow ramp, factory
ships and the system of deep fishing lines. In the last three years the Group
has invested 30 million euros in these improvements (in 2011, 6 million in
expenses and 8 million in investments; in 2010, 5.8 million in expenses and
2.3 in investments; in 2009, 5.4 in expenses and 2.5 in investments). In the
fishing world, what is fundamental is not only having the most suitable
vessels for each species and fishing grounds but also having access to the
fishing ground itself, which different countries regulate through the grant of
licences and fishing quotas.
The fishing rights of the PESCANOVA Group have a high strategic value,
being in those countries where the undertaking has followed a policy of
subsidiaries being the determining factor in its current competitive position
within the sector.
Fish catches for human consumption made by the PESCANOVA Group are
made in the principal fishing grounds of the world (all located away from
Spain), with the most important being those of Namibia, Mozambique,
Angola, South Africa, Australia, Uruguay, Argentina and Chile. One of the
most important consequences of the Group’s strategy is the large fishing
quota which it maintains in the fishing grounds in which it is present.
The activities of the PESCANOVA Group take place in diverse fishing zones
or fishing grounds and for different species, with the most important being
those specified in the following table:
Countries/zones where the greatest
catches are made
Namibia, South Africa, Chile and
Argentina
Mozambique, Angola, Australia and
Argentina
Argentina, Australia and Chile
Species in respect of which the
greatest catches are obtained
Hake
Prawn
Deep water species
The existence of species common to several fishing grounds and fishing
grounds with several species (diversification which ensures nonconcentration) guarantees the supply of goods independently of specific
situations with a reduction in supplies in some of them.
A good part of the product preparation process is carried out on board freezer
vessels, in which the fish is subjected to an immediate process of selection,
butchering, filleting and ultra-freezing, in such manner than on land the
product can in some cases be used directly for selling or subjected to other
final stages of cleaning, preparation and packaging. This production system is
of particular importance, giving rise to optimum use made of the capacity of
the fleet for catching and storing.
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28
Furthermore, it must be indicated that the countries owning the resources
expect that at least part of the profits generated from use of their natural
resources revert to their own economies.
Thus, both through its fleet and the plants which it has in the countries where
it operates, the PESCANOVA Group becomes an important source of foreign
currency for them and facilitates the generation of employment. The plants
which the PESCANOVA Group operates in these countries are devoted both
to handling the frozen fish and its freezing and maintenance. This
organisation permits an international division of work in order to maximise
efficiency in the utilisation of resources.
The quantity of fish extracted from the sea by the different fishing companies
of the PESCANOVA Group in the last three years has remained stable at
around 110,000 tonnes annually.
Sales by the PESCANOVA Group of seafood products originating from
fishing in 2011 exceeded 200,000 tonnes.
Fish farming Activities
Fish farming activities have been present on land for around 4,000 years, by
the use of backwaters in estuaries to retain fresh water species such as carp, or
in intertidal zones in marine estuaries with the savorin.
It was not until the decade of the nineteen seventies when what can really be
called the fish farming industry began, in which development in the
knowledge of nutritional requirements permitted the application of balanced
diet preparation technologies, the development and implementation of biosafety, hygiene, prophylaxis, immunisation, etc. systems which improve
survival rates, as well as knowledge of reproductive processes, identification
of the different complex larval phases or metamorphosis processes, assisted
by the application of genetics as an element in improvement, which overall
made the process of domestication possible.
Rearing activities can be carried out in salt or fresh water depending on the
species in question, and thus molluscs are cultivated (oysters, clams or
mussels), crustaceans (prawns, lobsters) or fish (trout, tilapia and scad in
fresh water, salmon in the two media depending on their development stage,
and turbot, sea bass or sea bream in salt water), to cite the most significant
examples.
Molluscs are raised in the marine medium, basically in intertidal areas, and
their feeding is natural, being provided by the medium in the form of
plankton.
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29
With crustaceans rearing takes place in intertidal areas of tropical zones in the
case of prawns, in large pools of up to 20 hectares, having four clearly
distinct stages, reproduction, larva, fry and fattening.
For fish the technology is essentially similar to that of crustaceans, with two
principal classes, swimming fishes and bottom fishes. The first are cultivated
in plants in tanks which can be of concrete or plastic materials on dry land,
until they reach a minimum size, when they are transferred to the sea where
they are enclosed in mesh cages or enclosures where they are kept, feeding
them until they reach commercial size.
Bottom fish such as turbot are cultivated in tanks on dry land, also of concrete
or plastic materials, pumping the necessary water from the sea in order to
fulfil its function as medium for substrate, transport and food distribution,
provision of oxygen and removal of waste.
At the present time feeding consists of complex products in the form of dry
pellets, the composition of which includes the elements which must cover all
nutritional requirements, guaranteeing hygiene and facilitating transport and
storage.
Biosecurity must be understood as the series of organised measures which
comprise human, technical and environmental elements designed to protect
all living human and animal beings and the environment from the risks
involved in the permanent presence of infecto-contagious agents or physical
and mechanical elements.
Genetics is the branch of science which facilitates improvement of the general
qualities of a live being by the application of legal techniques. By applying
them, the capacity for resistance to illnesses is increased, and growth rates
and general characteristics as a whole are improved.
Fish farming in the PESCANOVA Group began in 1984 in the installations in
Galicia, with cultivation of live fish prey originating from marine plankton
for feeding the larval stages of the different species, such as different types of
micro-algae, rotifera or artemia salina, as well as from knowledge of
cultivation of the shrimp of the Vigo estuary.
The Group currently cultivates the following species:
•
•
•
•
Salmon species in Chile, with the varieties of Atlantic salmon, coho
salmon and rainbow trout.
Turbot in Spain and Portugal.
Tilapia in Brazil.
Crustaceans in Central and South America, with the white shrimp, and in
Andalusia the Japanese prawn.
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30
According to FAO data, and as can be seen in the following graph (most
recent available data), world catches have remained stable without growing or
falling for 20 years, at around 90 million tonnes of fish annually worldwide.
Of these, some two thirds, approximately 63 million tonnes of fish extraction,
is devoted directly to human consumption.
Fish extraction for human consumption
(64m tonnes in 2010 est.)
Source: FAO
Also according to the FAO, it can be seen that world demand for fish has
been growing in recent years at a rate of 3% annually, which in the last 21
years (most recent available data) is a cumulative increase of almost 50%. It
can be seen from the following graph that the increase in demand arises in the
market based on species cultivation and not on the basis of fish catches,
which as we have seen are being maintained.
Aquaculture v. Fish Extraction
160
140
120
100
Total Aquaculture (excluding
g aquatic plants)
80
60
40
Total Fish Extraction (Excluding aquatic plants)
20
0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
World population has been growing at a rate of 1% annually in the last
decade. During the same period growth in marine protein consumption (fish
from fish farming) has grown 69%.
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31
Growth in world population. 2010 Revision (Millions of persons)
12,000
10,000
8,000
6,000
4,000
2,000
0
2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Constant Proj.
Average Proj.
High Proj.
Low Proj.
Source: UN, Department of Economic and Social Affairs, Population Section (2011)
And the contribution of products from aquaculture to human consumption
grew by 48%.
According to the most recent date provided by GOAL (Global Aquaculture
Alliance), it is estimated that in the next 10 years world aquaculture
production will grow up to 90 million tonnes annually and therefore will
equal the amounts generated by fish extraction and which as can be seen
above has not varied in amount for decades.
A chart is shown below with consumption of the principal aquaculture
species, highlighting those in which the PESCANOVA Group is present.
Legend:
Principal aquaculture species consumed in western countries, 2010
(thousands of tonnes)
Carp, barbels and other cyprinidae
Various fresh water fish
Clams, cockles, arcas
Oysters
Prawns, shrimps
Tilapia and other cyclidae
Salmon, trout, smelt
Scallops
Various marine molluscs
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32
Source: FAO. Most recent available data
•
The majority of the tonnes produced by fish farming are generated and
consumed in the largest world market, China.
•
The three principal species consumed in the markets of Europe and the
US and produced in fish farming systems reach an annual production of
6.28 million tonnes.
According to the NFI (National Fisheries Institute (USA)), the consumption
of fish per capita in one of the largest markets in the world, that of the USA,
is shown below, where it can be seen that in the last 23 years for which
information is available the consumption of prawns per capita and year went
from 1.04 kg per year to 1.81 kg per person/year; and that of salmon from 200
g/year to 901 g per person/year. There was a similar evolution in European
markets. The only possibility to supply the demand in these markets consists
of being able to access resources, either by direct fishing or by cultivation of
the principal species in demand.
Rank
1
2
3
4
5
6
7
8
9
10
1987
Tinned tuna
Prawn
Cod
Haddock
Flatfish
Clam
Catfish
Salmon
Crab
Scallop
Others
Total top 10
Total Sea P.
Kg
1.59
1.04
0.76
0.40
0.33
0.30
0.27
0.20
0.15
0.15
2.16
5.19
7.35
%/Total
21.63
14.15
10.34
5.44
4.49
4.08
3.67
2.72
2.04
2.04
29.39
70.61
100.00
2010
Prawn
Tinned tuna
Salmon
Tilapia
Haddock
Catfish
Crab
Cod
Pangasius
Clam
Others
Total top 10
Total Sea P.
Most recent available data. Source: National Fisheries Institute(NFI)
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33
Kg
1.81
1.22
0.91
0.66
0.54
0.36
0.26
0.21
0.18
0.15
0.85
6.32
7.17
%/Total % Variation
25.3%
74%
17.1%
-23%
12.7%
353%
9.2%
7.5%
35%
5.1%
34%
3.6%
73%
2.9%
-72%
2.6%
2.2%
-48%
11.9%
88.1%
100.0%
Aware of the scarcity of fish products, in the nineteen eighties
PESCANOVA, S.A. began to develop the activity of fish farming, or
aquaculture (cultivation of marine species). In this field the Company’s
objective is that the volume of production from fish farming grows in order to
thereby increase the production of fish at a rate which it would be difficult to
achieve by fishing, which will enable it to maintain its current positioning in
the world fish sector.
The fish farming activities of the PESCANOVA Group are basically
structured through Acuinova Chile, S.A., Novaustral, S.A., Promarisco, S.A.,
Servicios y Contrataciones, S.A., Camarones de Nicaragua, S.A., Camanica
Zona Franca, S.A., Zona Franca Río Real, S.A., Kokua Development
Corporation, S.A., Río Tranquilo Empresa de Camarón, S.A., Yang Shrimps,
S.A., PESCANOVA Nicaragua, S.A., Novahonduras, S.A., Novaguatemala,
S.A., PESCANOVA Brasil, S.A., Acuinova Actividades Piscícolas, S.A. and
Insuiña, S.L.
Following market criteria, the PESCANOVA Group developed species
reproduction techniques, which constitute an alternative to the shortage of
natural sources. Fish farming of the PESCANOVA Group is basically
focused on high value species such as prawns, turbot, salmon and tilapia,
although it is engaged in development of the necessary technology to produce
other high value species in the future.
The PESCANOVA Group has already passed through an initial stage of study
and creation of the necessary infrastructures for development of fish farming
of the majority of the species which it produces. It is currently at a second
stage, which we could call industrial, in which it begins to see the fruit of the
investments and studies carried out in the past.
These new investments, in their initial stage, require working capital or
financing until the commencement of production which can be
commercialised.
After passing through the initial stage of creating business structures, work
takes place on consolidation of these structures, for which advertising
campaigns are required in order to promote the consumption of fish amongst
the population and make them aware of the quality of the products obtained.
These campaigns take place through different producer associations in which
the PESCANOVA Group actively participates.
Independently of the stage of development of each of the species in fish
farming, the PESCANOVA Group continues to promote research in this area
for the purpose of continuing to improve the quality of the product offered to
its customers and increase the efficiency of the operations managed. At the
present time each Group business carries out Research and Development
work in relation to the species which they obtain, being coordinated by
PESCANOVA, S.A. from Spain.
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34
With respect to its fish farming activities abroad, the PESCANOVA Group is
present in Chile (particularly salmon species), Ecuador, Nicaragua, Honduras
and Guatemala (principally prawns), Brazil (tilapia) and Portugal (turbot).
Sales of fish farming products of the PESCANOVA Group represented
92,900 tonnes of own production in 2011.
According to FAO data (most recent available data) in the last 50 years the
growth in fish farming production has been vertiginous, and all the
indications are that in the next two years the contribution of fish farming to
the human diet will reach the same figure as that of wild fish.
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35
Acuicultura destinadaal
Aquaculture
for human consumption
consumohumano (60m tn
tons
in 2010)
in 2010)
Source: FAO
Growth in Consumption of Products from Aquaculture
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
80%
69%
70%
64%
58%
60%
53%
50%
46%
40%
40%
32%
27%
30%
20%
20%
10%
14%
8%
2% 1.3%
0%
0%
4%
5%
3%
-1%
-10%
Cumulative Aquaculture Growth
8%
4%
1%
12%
10%
5%
-3%
6%
0%
Cumulative Meat Growth
17%
15%
8%
10%
9%
9%
Cumulative Cereal Growth
10%
8%
11%
13%
Transformation activities
As well as the transformation activities which the Group carries out in its
fishing vessels (first processing, cleaning, filleting and freezing),
transformation activities take place in the industrial plants on land (detailed
preparation, incorporation of added value, obtaining pre-cooked products,
their refrigeration and freezing).
36
12%
20%
Cumulative World Population Growth
“aquaculture continues to grow more rapidly than any other sector of food production of animal origin and at a
higher rate than the population” (FAO – The World State of Fishing and Aquaculture, 2010)
Share Registration Document
24%
22%
19%
13%
19%
Distribution and commercialisation activities
Since the beginning of fishing activities in 1960, PESCANOVA has
developed an intensive activity of distribution and commercialisation of its
products in the market. This favoured the creation in Spain of the logistics
distribution network for frozen products, both transport and storage, and the
appearance of the first chest freezers for the sale of frozen products in
foodstuffs establishments in the Spanish market. Its own logistics and
commercial network, spread over the whole country, enables it to reach all
Spanish households.
In the nineteen eighties the Company also began a process of product
diversification, such that it acquired a presence in the sector of frozen food
distribution other than fish and shellfish, such as flour derivatives and
vegetables. The ultimate objective was to be able to meet the requirements for
stocking large stores as a multi-product supplier, and at the same time
optimising its commercial and logistical resources.
From the end of the nineteen eighties up to the present time the
PESCANOVA Group has diversified its commercial activities
geographically, opening up markets with commercial structures in Europe
(Portugal, France, Italy, Greece, Poland), the USA and Japan.
The PESCANOVA Group has continuously adapted its commercial and
distribution activities to customer concentration processes and to changes in
consumer habits both inside and outside the domestic sphere.
B. Activities by segments:
The PESCANOVA Group distinguishes segments related to sales of foodstuff
products from the provision of services such as leasing of refrigeration
installations, container service, shipyards in Mozambique and others.
Amounts turned over with third parties outside the Group during the 2009 to
2011 period are shown below:
(Thousands of euros)
Foodstuffs
Provision of services
Total
Share Registration Document
2011
%
1,630,578
98%
40,086
2%
1,670,664 100%
37
2010
%
1,532,568
98%
32,257
2%
1,564,825 100%
2009
%
1,445,257
98%
27,719
2%
1,472,976 100%
FOODSTUFFS
(Thousands of euros)
%
Variation
2009
10-11
%
Variation
09-10
2011
2010
Turnover
1,630,578
1,532,568
1,445,257
6.40%
6.04%
EBITDA
180,886
161,386
147,976
12.08%
9.06%
48,792
35,738
31,308
36.53%
14.15%
PROFIT OF PARENT
COMPANY
SERVICES
(Thousands of euros)
2010
%
Variation
10-11
2009
%
Variation
09-10
Turnover
40,086
32,257
27,719
24.27%
16.37%
EBITDA
2,640
1,963
1,733
34.49%
13.27%
PROFIT OF PARENT
COMPANY
1,348
559
783
141.14%
-28.61%
Consolidated Balance Sheet by segments
ASSETS
NON-CURRENT ASSETS
Tangible Fixed Assets
Intangible Assets
Goodwill
Investments recorded by the Acquisition Method
Long Term Investments
Deferred Taxes
CURRENT ASSETS
Stocks
Trade Debtors and Other Accounts Receivable
Short Term Investments
Cash and Equivalents
Other Assets
Non-current Assets Classified as Held for Sale
TOTAL ASSETS
31/12/2011
Foodstuffs
Services
1,105,254
14,889
991,633
13,149
37,931
-70,580
300
2,242
-218
140
2,650
1,300
1,132,643
23,695
672,103
4,702
240,625
18,634
1,748
-142,490
146
20,517
213
55,160
-2,237,897
38,584
EQUITY AND LIABILITIES
EQUITY
Of the Parent Company
Of Minority Shareholders
LONG TERM LIABILITIES
Deferred Income
Long Term Provisions
Bonds and Other Negotiable Securities
Long Term Financial Debt without Recourse
Long Term Financial Debt with Recourse
Other Long Term Accounts Payable
SHORT TERM LIABILITIES
Short Term Financial Debt without Recourse
Short Term Financial Debt with Recourse
Trade Creditors and other Short Term Accounts Payable
TOTAL EQUITY AND LIABILITIES
31/12/2011
517,294
492,223
25,071
920,474
111,522
2,613
244,704
128,031
383,556
50,048
800,129
4,803
193,671
601,655
2,237,897
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38
14,596
13,387
1,209
3,801
-9
--3,792
-20,187
-2,370
17,817
38,584
Thousands of euros
31/12/2010
Foodstuffs
Services
1,105,841
17,328
985,980
13,916
38,876
-70,415
355
149
-1,633
4,662
5,759
1,424
1,045,699
21,274
574,632
3,976
246,014
16,173
-8,264
130,834
613
21,512
512
64,443
-2,151,540
38,602
Thousands of euros
31/12/2010
462,020
15,146
434,543
13,941
27,477
1,205
4,316
806,634
119,677
-7
3,443
104,254
-120,046
-391,234
4,309
67,980
-19,140
882,886
-2,170
169,460
2,958
711,256
16,182
2,151,540
38,602
31/12/2009
Foodstuffs
Services
1,115,432
14,250
990,118
11,509
31,580
-74,900
276
1,654
-10,562
1,271
6,618
1,194
927,361
21,231
496,217
2,996
226,772
17,655
11,296
-99,686
215
24,559
365
68,831
-2,042,793
35,481
31/12/2009
432,342
404,728
27,614
629,614
125,831
8,714
-102,513
335,393
57,163
980,837
2,293
303,467
675,077
2,042,793
12,117
11,270
847
13,033
-8
--3,584
9,441
10,331
-2,601
7,730
35,481
PROFIT AND LOSS BY BUSINESS UNIT
(€m)
AQUACULTURE
2011
2010
2009
TURNOVER
CRUSTACEANS
FISH
465.3
293.5
171.8
406.9
272.0
134.9
353.5
259.2
94.3
EBITDA
%
CRUSTACEANS
%
FISH
%
63.2
13.6%
29.1
9.9%
34.1
19.8%
45.5
11.2%
17.2
6.3
28.3
21.0
34.0
9.6%
14.9
5.7%
19.1
20.3%
TRADITIONAL BUSINESS
TURNOVER
EBITDA
%
1,205.3
120.4
10.0%
1.158.0
117.8
10.2%
1,119.5
115.7
10.3%
TURNOVER
EBITDA
%
1,670.7
183.5
11.0%
1,564.8
163.3
10.4%
1,473.0
149.7
10.2%
TOTAL
During recent years, particularly from 2005 until 2010, investments by the
PESCANOVA Group led to the amount of fixed assets net of depreciation
growing until it almost doubled. The majority of the investments made in that
period were in the fish farming area.
The evolution can be seen in the attached table of operating profits and
turnover in the historical financial information period and highlighting the
increase in EBITDA in the 2009 to 2011 period, from 149.7 to 183.5 million
euros, a 22.6% increase, whilst turnover grew by 13.4%. This growth
principally derived from the fish farming area which grew by 31.6% in sales
and 85.9% in EBITDA. Both areas grew continuously, particularly that
connected with fish farming as a result of the major investments made by the
PESCANOVA Group between 2005 and 2010.
Year after year since the major investment in fish farming was completed
both sales and EBITDA continue growing as a result of the maturity periods
of the species cultivated, of long cycle in the case of salmon and turbot.
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39
C. Activities by geographic markets:
A table is shown below which includes a breakdown of sales of foodstuff
products and services by geographic areas:
%
%
Variation Variation
%
11-10
09-10
(Thousands of
euros)
1st
quarter
2012
%
2011
%
2010
%
2009
Domestic Market
160,975
46%
800,289
48%
794,665
51%
779,372
53%
1%
2%
Exports:
189,985
54%
870,375
52%
770,160
49%
693,604
47%
13%
11%
European Union
88,406
25%
402,259
24%
376,311
24%
348,609
24%
7%
8%
Other Countries
101,579
29%
468,116
28%
393,849
25%
344,995
23%
19%
14%
1,472,976 100%
7%
6%
Total
350,960 100% 1,670,664 100% 1,564,825 100%
The evolution in sales during 2009 maintained the same trend as in the
previous year by growing overall by 9.7% in relation to the previous year.
This growth took place in all areas in which the PESCANOVA Group
operates, and in particular sales outside the European Community, which
grew by 26%, headed up by the good data on sales in the USA. In the
domestic market there was a growth in sales of 4.4%, representing 53% of
Group sales. In markets in the rest of the European Community growth
reached 8%. A growing diversification can be seen in sales of the
PESCANOVA Group which now almost reaches 50% in the different
markets outside Spain.
During 2010 evolution of sales was very favourable in all markets in which
the PESCANOVA Group operates, with growth in all of them, both in Spain
(2%) and particularly in the US market.
During 2011, and for the first time in the history of PESCANOVA, more than
half of Group sales took place abroad, 24% in the rest of the EU and 28% in
markets outside the EU, in particular the USA and Japan, as well as other
emerging markets such as Cuba, Russia, Mexico and Brazil. Whilst the
increase in sales in Spain reached 2%, the increase in overseas markets grew
by 13%, in line with what happened in previous years and as a result of the
gradual maturity of investments made in past years in the fish farming area.
As well as diversification by product, the Company has been increasing its
geographical diversification (first Europe and then Asia and America) over
the whole of its history, with the objective of reducing its dependency on
local markets.
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40
6.1.2 An indication of any significant new products and/or services that have
been introduced and, to the extent that development of new products or
services has been publicly disclosed, give the status of development.
No significant product or service has been introduced recently.
6.2 Principal markets
A description of the principal markets in which the issuer competes,
including a breakdown of total revenues by category of activity and
geographic market for each financial year for the period covered by the
historical financial information.
The most important markets are shown below where PESCANOVA is
present, based on its current sales.
Geographic breakdown of sales, 2011
Note: Other EU: The most significant (Greece and Poland)
The geographic breakdown of sales was similar in 2009, 2010 and 2011.
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41
SPANISH MARKET
I.
THE SOCIO-ECONOMIC ENVIRONMENT
Spain currently has 47.2 million inhabitants and over 17 million households,
which continue growing although at slightly lower rates than those
experienced in recent years.
Growth in Number of Households
Source: Ministry of Agriculture, Foodstuffs and the Environment
This growth in the number of households favours growth in mass
consumption markets.
II.
PROSPECTS FOR THE SEAFOOD PRODUCTS MARKET
AND PESCANOVA
THE HOUSEHOLD CONSUMPTION MARKET
Foodstuffs consumption in Spanish households reached the figures of 30,283
(millions kg/lts) and 67,520 million euros in 2011 (according to the
household panel of the Ministry of Agriculture, Foodstuffs and the
Environment), growing at 0.6% in volume compared with the same period of
the previous year.
Other data such as the Nielsen panel, which audits the Foodstuffs, Drinks and
Household Cleaning and Hygiene Product markets in the self service channel,
puts the annual mass consumption market at 69,300 million euros at August
2011 RT, which means an increase of 1.3% with respect to the previous year.
THE SEAFOOD PRODUCTS MARKET
The Spanish market for consumption of Seafood Products in 2011 reached
10.116 billion euros, concentrating 76.2% in Household consumption sales
and the remaining 23.8% in Foodservice.
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42
TOTAL SEAFOOD PRODUCTS VALUE
Value (000 €)
% Vertical Share
Total HOUSEHOLD
Super + Hyper
Fishmonger + Market
Freezer Centre
Others
OUTSIDE HOUSEHOLD
TOTAL SEA PROD.
7,712,178
76.2%
4,451,361
2,453,922
322,764
484,130
44.0%
24.3%
3.2%
4.8%
2,404,250
23.8%
10,116,428
100%
Source: Kantar Worldpanel, data Q4 2011 RT.
The market for seafood product consumption in Households is divided into
four categories: packaged frozen seafood products, loose frozen seafood
products, fresh seafood products and refrigerated seafood products. It is the
market for fresh seafood products which concentrates the majority of the
market, 69.6%, followed by the market for frozen seafood products, at 29.1%
(packaged 20.6% and loose 8.5%), and refrigerated seafood products which
begin development of the market with 1.2% of the market
Legend:
Refrigerated 1.2%
Packaged Frozen 20.6%
Loose Frozen 8.5%
Fresh 69.6%
Refrigerados
1,2%
Congelados
Envasados
20,6%
Congelados Granel
8,5%
Frescos
69,6%
Source: Kantar Worldpanel, data Q4 2011 RT. (Percentage of amount)
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43
The Spanish market for Seafood products has grown constantly over recent
years, in the most recent Running Total reaching 7,712 million euros and
increasingly concentrating weight in the Spanish household shopping basket
(which currently means 11.4% of the total foodstuffs market), being one of
the most important categories.
9,000
8,000
1,157
7,000
825
6,000
1,137
816
1,332
1,415
1,506
1,588
929
840
768
705
658
592
580
4,000
761
1,159
1,048
764
5,000
894
741
670
3,000
2,000
1,249
971
3,562
3,897
4,154
4,452
2001
2002
2003
5,360
5,475
5,469
5,372
5,271
5,370
2005
2006
2007
2008
2009
2010
2011
40.8
52.9
57.2
59.7
68.7
80.0
95.8
1,249
1,332
1,415
1,506
1,588
4,794
5,030
2004
1,000
0
2000
Refrigerated
580
Packaged Frozen
592
764
816
825
971
1,157
670
761
741
894
1,048
1,159
1,137
929
840
768
705
658
Fresh
3,562
3,897
4,154
4,452
4,794
5,030
5,360
5,475
5,469
5,372
5,271
5,370
Total
4,812
5,249
5,659
6,162
6,666
7,200
7,706
7,711
7,700
7,624
7,562
7,712
Loose Frozen
Source: Kantar Worldpanel. Data in millions of euros.
With respect to the principal sales channels, the self service household
channel (which covers supermarkets and hypermarkets) concentrates over
half of sales (57.7%), and it is the fresh seafood products which achieve the
highest sales (65.1%), compared with 32.7% of frozen seafood products and
2.2% of refrigerated seafood products.
SEAFOOD PRODUCTS VALUE Market
Total HOUSEHOLD
Super+ Hyper
Value
% Vertical
Value
% Share
% Vertical
Packaged Frozen
1,588,378
20,6%
1,181,155
74.4%
26.5%
Loose Frozen
658,376
8,5%
274,486
41.7%
6.2%
Fresh
5,369,652
69,6%
2,899,948
54.0%
65.1%
Refrigerated
95,772
1,2%
95,772
100.0%
2.2%
Total
7,712,178
100%
4,451,361
57.7%
100%
Source: Kantar Worldpanel, data Q4 2011 RT.
% Share= Weight of the Super+Hyper Channel in the Total HOUSEHOLD Market.
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44
Focusing on the packaged frozen seafood products market commercialised in
the self service household channel where the PESCANOVA brand engages in
its branding activity, market figures also show a sustained growth during
recent years.
ENVIRONMENT BY VOLUME (tn)
110,412
82,002
87,053
90,067
98,506
97,746
74,409
59,580
40,272
2001
FISH BASED PREPARED DISHES
SURIMI+EEL SUBSTITUTE
PREPARED FISH
SHELLFISH
NATURAL FISH
44,512
2002
68,399
51,767
2003
2004
2005
2006
2007
2008
2009
2010
Tam
S52'10
Tam
S52'11
194
8,147
300
8,568
419
1214,9
560
12,703
592
14,386
718
14,844
848
15,018
696
14,566
445
14,453
388
15,036
701
14.932
611
15.759
12,038
11,704
12,413
12,327
13,435
13,777
14,154
15,989
14,492
19,893
14,240
22,652
14,121
26,993
15,465
29,503
15,804
30,644
16,438
33,129
16.498
32.097
17.985
34.854
8,190
40,272
10,903
44,512
12,921
51,767
16,173
59,580
19,036
68,399
21,955
74,409
25,022
82,002
26,823
87,053
28,721
90,067
33,516
98,506
33.518
97.746
41.203
110.412
(Source: Nielsen).
EVOLUTION IN VALUE (Thousands of euros)
713,845
573,469 603,164
472,674
648,032
644,900
598,592
518,483
422,793
380,574
298,035 317,440
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
FISH BASED PREPARED DISHES 1,713
2,648
3,633
5,282
5,462
6,405
7,515
7,235
4,459
3,823
6,421
5,398
SURIMI+EEL SUBSTITUTE
44,626
76,554
81,688
84,172
82,812
86,090
83,348
80,637
80,490
80,505
83,225
72,568
68,294
94,906
43,925
Tam S52'10
Tam S52'11
PREPARED FISH
64,931
67,328
73,594
74,287
72,358
79,137
77,528
84,687
85,241
SHELLFISH
120,964
118,903 127,582
141,421
166,685
189,308 217,505
228,453
234,026
258,298
251,999 269,615
66,501
83,934
100,237
120,808
142,068
167,601 194,065
204,991
201,942
220,735
220,735 260,700
298,035
317,440 380,574
422,793
472,674
518,483 573,469
603,164
598,592
648,032
644,900 713,845
NATURAL FISH
(Source: Nielsen).
The Seafood Product category, with a total of 110,412 tonnes, accounts for
31.4% of the volume and 52.3% of the total value of packaged frozen
products which are commercialised in the Spanish self-service household
channel.
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45
It comprises the markets for Shellfish, Natural Fish, Prepared Fish and
Shellfish and Surimi and shows growths of 13% by volume and 10.7% by
value in the most recent week 52/2011 RT vs. previous year. Acting as a
motor for growth in the frozen food market since the remaining categories
show much lower growth (1% by volume and 2.7% by value).
Total Frozen
SHARES by VALUE
Total Frozen
SHARES by VALUE
47.7%
68.6%
52.3%
31.4%
RT Week 52´11
Seaf. Prod.
RT Week 52´11
Remaining categories
Seaf. Prod.
Remaining categories
The PESCANOVA brand continues to be the leading operator in this market,
which a share of 19% by value and 17.6% by volume. (Source: Nielsen, data
RT week 52-2011).
Frozen Seafood products
SHARES by VALUE
Frozen Seafood products
SHARES by VOLUME
48.5%
54.7%
32.5%
27.8%
19.0%
17.6%
TAM Week 52´11
PESCANOVAOther Brands
TAM Week 52´11
DB
(Source: Nielsen).
DB= Distributor Brand
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46
PESCANOVA Other Brands
DB
Packaged Frozen Products are present in 97.8% of Spanish households, with
Seafood products being the type of frozen food which is most consumed, with
a penetration of 92.9%. Average Spending on Packaged Seafood products
increased last year by 4.7%.
The commercial activity of PESCANOVA focuses on sale of a broad variety
of Frozen, Fresh and Refrigerated Products, particularly originating in the
Fishing and Fish Farming world.
PESCANOVA engages in commercial activities in four channels:
 Self-service Household Channel, which includes hypermarkets and
supermarkets.
 Specialist Household Channel, which includes stores specialising in
frozen foods, fishmongers and traditional markets.
 “Food Service” Outside Household Channel, which includes catering
establishments (bars, hotels, cafes, etc.), catering businesses and
collectives, etc.
 Wholesale Channel.
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PORTUGUESE MARKET
I.
THE SOCIO-ECONOMIC ENVIRONMENT
In March 2011 the resident population of Portugal was 10.6 million (Source:
INE). During the 2006-2011 period the number of residents in Portugal grew
at an average rate of 0.21% per year.
II. PROSPECTS FOR THE SEAFOOD PRODUCTS MARKET AND
PESCANOVA
According to data provided by TNS Worldpanel regarding the Portuguese
internal market for household consumption of frozen products, it can be
concluded that in the 2010-2011 period it grew by 2.2% in value terms.
III.
HOUSEHOLD FROZEN FOOD RETAIL MARKET
According to Nielsen data, for the 52 weeks of 2011 the frozen food market
reached 418.1 million euros and 92.1 thousand tonnes (market for products
with retail packaging). In the same period, also according to Nielsen, the
market for frozen seafood products reached 230.8 million euros and 31.4
thousand tonnes (market for products with retail packaging).
Analysing the Nielsen Report on the Portuguese market for RT 2011.52, it
can be concluded that the frozen product market grew between 2010 and
2011 by 0.9% in terms of volume and 4.2% in terms of value. Moreover, the
sea product market from 2010 to 2011 grew by 3.5% in volume terms and
7.7% in terms of value.
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FROZEN SEAFOOD PRODUCTS
Vs
TOTAL FROZEN FOODSTUFFS
% VOLUME
100
90
80
70
66.7
65.9
33.3
34.1
60
50
40
30
20
10
0
RT UP TO 2010 52
91,224.3
RT UP TO 2011 52
92,065.7
SEAFOODS
OTHER FROZEN
Source: TNS
IV. PRINCIPAL SALES CHANNELS
In Portugal the PESCANOVA Group sells in the Retail and Food Service
channels with a broad range of products. PESCANOVA is the leading brand
in the Retail channel, with a share of 13.7% by value, which represents six
points more than the second operator (Source: Nielsen TAM 2011.52).
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49
FRENCH MARKET
I.
THE SOCIO-ECONOMIC ENVIRONMENT
In 2012 the resident population of France was estimated at 65.35 million.
II.
PROSPECTS FOR THE SEAFOOD PRODUCTS MARKET AND
PESCANOVA
The French market for frozen seafood products is strategic to the
PESCANOVA Group due to its large size (240,000 tonnes). It is furthermore
a highly competitive market with the presence of several well-known brands
and distribution brands.
At market level, spending per French family on foodstuffs is in third position
only after spending on accommodation and transport.
III.
LAUNCH OF PESCANOVA IN THE FRENCH MARKET
The fact that PESCANOVA is market leader in the branded segment of the
Spanish frozen seafood product market (Nielsen data RT Week 2011.52) has
helped the Group to introduce its products into a highly competitive market.
IV.
RETAIL SECTOR
Direct distribution is the leading retail channel for food sales, representing
more than 66% in terms of value in 2011. The remaining 33% takes place
through stores and food stores. Carrefour, Auchan, Intermarché, Leclerc,
Super-U, Casino and Cora make up around 50% of the market and the
remaining 50% is distributed between all other retailers. The French retail
sector is sophisticated, well-developed and professional.
Modern distribution is the principal channel for the domestic consumption
market and remained stable at 46% of the frozen food sector (distributor
brand) in 2010. This type of distributor has traditionally increased its
presence at the cost of small local brands, which strengthens the role of
specialised distributors like PESCANOVA which has benefitted from both
the reduction in number of competitors and higher sales volumes.
V.
POSITIONING OF PESCANOVA
PESCANOVA is a global figure in seafood products with an important
strategic positioning and a broad concentration of consumers in both the
Retail and Food Service channels. The fact that the Group is capable of
supplying large volumes represents a competitive advantage compared to
other suppliers. In the French market the principal seafood products are
packaged in retail format and presented in natural form, although coated
products are also present (battered, breaded, etc.).
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50
In the Food Service channel PESCANOVA has a strong position as global
provider of seafood products (prawns, lobsters, hake, etc.) and it is precisely
in this channel in which PESCANOVA has most presence with its capacity
and reliability as supplier. Consequently, this channel has undergone the
highest increase in sales and it is the one which presents the most pronounced
competitive edge.
In terms of volume, the French market is the second largest in the EU for the
Group.
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51
ITALIAN MARKET
I.
THE SOCIO-ECONOMIC ENVIRONMENT
In 2012 the population of Italy was estimated to grow by 0.38%, reaching
61.2 million.
II. PROSPECTS FOR THE SEAFOOD PRODUCTS MARKET AND
PESCANOVA
The Italian frozen seafood market is strategic to the Group due to its size
(116,000 tonnes or 1,410 million euros). In 2009, due to the global financial
crisis, growth in Italy was just 1.7%. In 2010 growth by volume remained
practically the same with similar percentages to 2009: 1.7% (Source: IIAS). It
is a highly competitive market with competition between multinational
companies such as Nestlé and leading investment firms in the consumer
sector such as Lion Capital (new owners of the Findus brand), as well as
distribution brands.
III. LAUNCH OF PESCANOVA IN THE ITALIAN MARKET
In the Italian frozen seafood market the PESCANOVA Group is capable of
ensuring adequate production management (wild, caught or cultivated) as
well as its processes and marketing. This is of great importance in
understanding the capacity of PESCANOVA to supply products from their
source, react to new market trends and innovate.
IV. POSITIONING OF PESCANOVA
PESCANOVA is a global integrated supplier of frozen seafoods which offers
its products (including in retail packaging, both natural and coated) through
channels which are capable of reaching the maximum number of customers
(supermarkets and hypermarkets as well as frozen food stores).
In the wholesale market, PESCANOVA is also present as supplier of seafood,
particularly prawns, and it is in this market in which PESCANOVA is wellknown for the quality of its products. This market underwent a growth of
66% between 2010 and 2011.
In terms of volume, the Italian market is the fourth largest in the EU for the
Group.
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52
GREEK MARKET
I.
THE SOCIO-ECONOMIC ENVIRONMENT
In 2010 GDP underwent negative growth of 4.5% compared with 2009.
In May 2011 the Greek population amounted to 10.7 million.
II. PROSPECTS FOR THE SEAFOOD PRODUCTS MARKET AND
PESCANOVA
The frozen seafood market in Greece has undergone sustained growth in
recent years, having exceeded 320 million euros per year, thanks in part to the
development of fish farming and the success of frozen food in general in
retail format. The market has begun to consume this type of foodstuffs with a
more uniform distribution over the whole of the year, as a simple and
nutritive alternative, following marketing campaigns.
The market is organised through the National Association of Frozen Food
Business, formed by 10-12 large companies, five of which have their own
plants.
Despite the fact that data is not available on frozen seafoods, since the
existing data relates to the total frozen foodstuffs market, PESCANOVA
considers that the market has a total value of 320 million euros and that it will
continue to grow despite the bad economic situation.
III. THE GREEK MARKET FOR SEAFOOD
The market is divided into two categories, retailers aiming at the household
consumption market (less than 40% of total sales) and Food Service (60% of
sales), which includes hotels, restaurants and so-called cash & carry points of
sale.
The principal products in 2010 in this sector were hake, perch, cod, different
types of squid, octopus, cuttlefish, mussels and prawns. 90% of these were
imported in 2010.
IV. POSITIONING OF PESCANOVA
The history of PESCANOVA in Greece is still short but branded products
have already been present for some years in the lines of the principal
distribution chains, and it is a reference supplier in the Food Service channel.
Last year, 2011, the range of products sold by PESCANOVA increased
considerably.
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53
The principal products which the Group sells in Greece originate from South
America (particularly hake). On the other hand, crustaceans, particularly
prawns, have been gradually gaining market share and overall have in a
certain manner helped the consumer to become accustomed to new types of
food, which is the ultimate objective of the Group.
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54
POLISH MARKET
I.
THE SOCIO-ECONOMIC ENVIRONMENT
Growth in the Polish economy in 2010 was 3.9% (GDP) (Source: Eurostat).
At the end of the third quarter of 2011 growth was 4.3% (GDP), according to
data from the same source.
According to Eurostat, the number of inhabitants of Poland in 2011 was 38.3
million.
II. PROSPECTS FOR THE SEAFOOD PRODUCTS MARKET AND
PESCANOVA
In general the trend has been positive, with approximate growth of 5% in
2010. The consumption of seafoods grew in 2011 to 13.8 kg/person. Poland
has undergone a fall in the supply of local species due to excessive fishing in
the Baltic Sea, which has led to importing frozen raw materials from other
parts of the world. The most significant imported species were pangasius,
haddock, tilapia, grenadier, hoki, mackerel, herring and prawns. The most
common sources were China, Vietnam, India, Thailand, Indonesia,
Bangladesh, Argentina, Chile, Peru, Norway, The Netherlands, Spain,
Ireland, United Kingdom, France, Russia and Latvia.
Frozen products grew by 5% in 2010, reaching a value of 1,720 million zlotys
(the equivalent of the Polish zloty, PLN, at 31/12/2011, was 4.46 PLN/EUR).
In relation to the frozen seafood market, 80% of sales took place through the
retail channel and the remaining 20% through the Food Service channel,
reaching 60,000 tonnes. In value terms the market for frozen seafood
generates 670 million PLN. Seafood of better quality is served solely in the
best hotels and restaurants. Salmon is the most important species in the Food
Service sector, with its source 95% from Norway and being sold fresh. Retail
sales, for household consumption, traditionally take place in food stores;
nevertheless, the share of supermarkets and hypermarkets has increased in the
last four years, reaching 30%-45% depending on the product.
The Polish market has undergone an increase in demand for seafood. In the
first three quarters of 2011, 76% of Polish families purchased frozen seafood
in the retail sector, spending 430 million PLN.
III. POSITIONING OF PESCANOVA
The presence of PESCANOVA in Poland is relatively recent, although
PESCANOVA products can now be found in the principal distribution
channels and it is aiming at the Food Service sector.
The principal products which the Group sells in Poland (Food Service
channel) originate from South America.
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55
US MARKET
PROSPECTS FOR THE SEAFOOD PRODUCTS MARKET AND
PESCANOVA
The US seafood products sector is a market of 74.1 billion dollars which has
grown by 37% in the last decade (2000-2009). This growth has mainly been
achieved due to the growing perception of the benefits of its consumption to
health and the reality of efficient fish farming.
The US market records the third highest volume of consumption of seafood
products at world level. In 2009, of the total consumed, some 84% was
imported product.
It is estimated that global production from fish farming in forthcoming years
will represent 50% of the world supply of seafood products. Of the 157
million Tm of world production in 2011, 90 million tonnes related to catches
and 67 million tonnes to aquaculture. For 2012 a small fall in catches is
estimated of 0.4% and an increase of around 6% in aquaculture with respect
to 2011 volumes. (Source: FAO).
With respect to the four principal cultivated species, growth rates are
projected for them in forthcoming years.
Tilapia has increased by more than 100% since 2002 when production was
around 1.5 million tonnes, in 2010 exceeding production of 3 million tonnes.
With an ongoing growth trend, it is estimated that production will exceed 3.5
million tonnes in 2013.
The production of prawns reached 3.4 million tonnes in 2008, the year in
which for the first time the percentage of fish farming production exceeded
that of fish caught (52%). After a slight fall in 2009, in 2011 the figure for
world production was 3.2 million tonnes. A change in trend is forecast in
2012, with an estimated growth rate of 10.3% in 2012 and 2013.
Salmon has recovered the growth rates of recent years, reaching volumes of
1.9 million tonnes in 2011 and with production expectations for 2012 in
excess of 2 million tonnes.
Another significant product in fish farming has been pangasius. Production in
2010 exceeded 1.8 million tonnes.
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56
US Seafood Product market:
Total annual sales
(Billions $)
Source: National Marine Fisheries Service (NMFS). (Most recent available information).
Volume of imports (edible weight)
(Millions of tonnes)
Source: National Marine Fisheries Service (NMFS). (Most recent available information)
Share Registration Document
57
The market
Annual per capita consumption in the US market during 2010 was 7.17 kg.
In broad terms, the market is divided into two categories, Food Service
(Horeca) and Retail.
In 2009 the Food Service channel reached 50.3 billion dollars, 68% of the
total market, while the retail channel represented 23.8 billion dollars or 32%
of the market. However, the widespread opinion is that in a five to seven year
period these percentages will tend to equal out until achieving a 50%
distribution, as the retail channel increases it market share by promoting an
offer of products from sustainable and economic aquaculture available over
the whole of the year. Many cultivated products, including prawn and salmon,
are ceasing to be considered as luxury items or delicacies, and are becoming
items of mass consumption.
Seafood Products in the USA – Categories
o Prawn
Prawn continues to be the most popular product of greatest consumption in
the US market. In 2010 annual per capita consumption exceeded 1.81 kg. In
2009 the market remained world leader in imports of prawn at 545 thousand
tonnes, followed by Japan at 270 thousand tonnes. In 2010 the volume of
imports exceeded 558 thousand tonnes.
o Tuna
Consumption of tinned tuna has been falling constantly (the fall was 11% in
2009 with respect to 1996), and tilapia and salmon have been the products
which have benefitted with growth.
o Salmon
This continues to occupy third position in the list of the National Fisheries
Institute (NFI) of the principal seafood products consumed in 2009. Annual
per capita consumption reached 0.91 kg in 2010. Imports reached 221
thousand tonnes in 2010.
o Tilapia
In 2010 per capita consumption of tilapia reached 0.66 kg, rising from 0.52 kg
in 2007 and 0.45 kg in 2006. It continues to occupy fourth position in the list
of the National Fisheries Institute of the principal seafood products consumed
in 2009.
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58
o Overall demand
Assuming that the demand for seafood products continues to increase in
forthcoming years, cultivated species will cover the demand given the
stability of availability of wild species.
The following table, NFI data (USA) shows evolution of consumption of
seafood products, for the 10 most important, in the USA in the last two
decades, where the trend can be seen referred to in the previous paragraph.
Rank
1
2
3
4
5
6
7
8
9
10
1987
Tinned tuna
Prawn
Cod
Haddock
Flatfish
Clam
Catfish
Salmon
Crab
scallop
Others
Total top 10
Total Sea Prod.
Kg %/Total
1.59
21.63
1.04
14.15
0.76
10.34
0.40
5.44
0.33
4.49
0.30
4.08
0.27
3.67
0.20
2.72
0.15
2.04
0.15
2.04
2.16
29.39
5.19
70.61
7.35
100.00
Source: National Fisheries Institute (NFI)
Share Registration Document
59
2010
Prawn
Tinned tuna
Salmon
Tilapia
Haddock
Catfish
Crab
Cod
Pangasius
Clam
Others
Total top 10
Total Sea Prod.
Kg
%/Total % Variation
25.3%
74%
1.81
17.1%
-23%
1.22
12.7%
353%
0.91
9.2%
0.66
7.5%
35%
0.54
5.1%
34%
0.36
3.6%
73%
0.26
2.9%
-72%
0.21
2.6%
0.18
2.2%
-48%
0.15
11.9%
0.85
88.1%
6.32
100.0%
7.17
JAPANESE MARKET
I.
THE SOCIO-ECONOMIC ENVIRONMENT
The world financial crisis, appreciation of the yen against principal
currencies, and the major earthquake in Japan in 2011 have substantially
affected the Japanese economy. Nevertheless, PESCANOVA Group sales in
Japan have been positive if compared with 2010.
In 2010 the population of Japan was slightly above 128 million.
II. PROSPECTS FOR THE SEAFOOD PRODUCTS MARKET AND
PESCANOVA
Japan is one of the principal consumers of seafood and the consumption of
fish and shellfish is deeply rooted in Japanese culture (61 kg per capita/year).
It is in second place worldwide, solely after Iceland (87 kg) (Source:
FAOSTAT, 2007).
In 2010, 2.72 million tonnes of seafood were imported by Japan with a total
value of 1.37 billion JPY. The principal species were tuna (13%), prawns
(13%) and salmon (10.5%). No other species accounted for over 4%.
By value, imports were as follows: salmon (8.64%), tuna (7.94%), prawns
(7.57%), squid (2.86%), mackerel (2.80%), cod (2.5%), flatfish (2%), crab
(1.8%), octopus (1.65%), cod roe (1.47%). Other species are below 1.47%.
III. POSITIONING OF PESCANOVA
The role of PESCANOVA in the Japanese market is principally as importer
and trader. It offers both wild and farmed species: salmon from Chile, prawns
from different sources, squid and other specialities of the Group are sold in
this market. The Group presence in Japan is gradually increasing by the sale
of higher volumes and introduction of new species.
For PESCANOVA, the Japanese market is the second largest after the USA,
outside the EU.
Share Registration Document
60
6.3 Where the information given pursuant to items 6.1 and 6.2 has been
influenced by exceptional factors, mention that fact.
It is not considered that exceptional factors have arisen which must be
mentioned.
6.4 If material to the issuer’s business or profitability, a summary
information regarding the extent to which the issuer is dependent on
patents or licences, industrial, commercial or financial contracts or new
manufacturing processes.
It is considered that the dependency of the issuer on patents or licences,
industrial, commercial or financial contracts or new manufacturing processes
is not important to business activities or the profitability of the issuer, except
with respect to fishing licences, of which part are owned and others have been
historically renewed without difficulty.
Licences and quotas
The fishing activities of the PESCANOVA Group are determined by catches
made by Group vessels. The PESCANOVA Group fleet comprises freezer
and fresh fish vessels, trawlers, longliners, squid fishing vessels, and boom
trawlers, in general flagged in the countries in whose territorial waters they
operate with their corresponding licences and fish quotas. In order for a vessel
to operate in a particular fishing ground it requires a licence to fish in the
territorial waters of the country. The vast majority of such licences are not
limited in time and are perpetual, lasting even after the disposal of the vessel
by transfer to a replacement vessel of similar characteristics. Fishing quotas
are determined by the sustainability of the fishing ground in which they are
located and can vary in quantity if attempting to preserve the quality of the
fishing ground for the future.
Fishing licences include some which are valued in relation to an active
market and which are considered of indefinite useful life. These licences
amount to 7.8 million euros and the reasons for assuming an indefinite useful
life are ownership for an unlimited period and conservationist measures of the
Australian government and fishing industry aimed at maintaining the fishing
resource under optimum conditions. The acquisition cost of these licences
was 4.9 million euros.
6.5 The basis for any statement made by the issuer regarding its
competitiveness must be disclosed
Whenever the ISSUER includes data regarding its competitive position over
the course of this Registration Document, it specifies the source of this data.
Share Registration Document
61
7.
ORGANISATIONAL STRUCTURE
7.1. If the issuer is part of a group, a brief description of the group and the
issuer’s position within the group
PESCANOVA, S.A. is the parent of a large industrial group which includes
the PESCANOVA Group companies, whose activity is industrial operation
of all activities connected with products for human and animal consumption,
including their production, transformation, distribution, commercialisation
and engaging in other activities complementary or deriving from the
principal activity, both of an industrial and commercial nature, and holdings
in national and foreign undertakings.
A table is shown below with the organisational structure of the
PESCANOVA Group at the date of submission of this Registration
Document (no change has taken place since 31 December 2011, the date of
the attached table).
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62
PESCANOVA, S.A.
31 DECEMBER 2011
EUROPE
SPAIN
100%
100%
EIRANOVA
FISHERIES
100%
PESCANOVA
ITALIA
100%
NOVAPESCA
ITALIA
100%
PESCANOVA
LTDA.
FRIGODIS
ASIA
100%
NOVAPESCA
TRADING
90,36%
FRINOVA
99%
PESCAFINA
ACUINOVA
AC.PISCÍCOLAS
100%
PESCANOVA
ALIMENTACIÓN
100%
100%
FRIVIPESCA
CHAPELA
100%
ACUINOVA
S.L.
100%
100%
100%
PESCANOVA
HELLAS
100%
SEABEL SAS
25,1%
24,9%
AUSTRAL
FISHERIES
100%
ULTRACONGEL.
ANTÁRTIDA
100%
FRICATAMAR
50%
HASENOSA
100%
51%
PESCA CHILE
ACUINOVA
CHILE
MOREKIN
ANTARCTIC
FISHING
LICENCES
100%
PESQUERIAS
BELNOVA
19%
AMER. SHIPING
KFH HOLDINGS
100%
NOVA
AUSTRAL
100%
COMERCIAL
AUSTRAL
ACN 009286346
BOAPESCA
100%
CAMANICA
100%
PESCANOVA
JAPAN
100%
CAMANICA
ZONA FRANCA
32%
100%
ABAD EXM
KOKUA D.C.
100%
100%
ZONA FRANCA
RÍO REAL
ABAD OVERSEAS
PRIVATE
PESCAFRESCA
100%
RÍO
TRANQUILO
70%
PESCAMAR
100%
PESCABOM
71%
BEIRANAVE
99%
PESCANOVA 1%
USA
100%
COPOIC
92,50%
100%
NOVAPERÚ
100%
100%
AFRICA
33,33%
PESQUERA
YELCHO
INSUIÑA S.L.
BAJAMAR
49%
100%
100%
RENTKEEP
PESCANOVA
POLSKA
100%
ARGENOVA
100%
50%
PESCANOVA
FRANCE
100%
ANTARCTIC
POLAR
100%
100%
PESCAFINA
BACALAO
100%
100%
AMERICA
100%
NOVAOCÉANO
100%
NOVAGUATEMALA
NOVAGROUP
60%
NOVATECH
100%
NOVASHIP NAM.
49%
NOVANAM
LIMITED
100%
NOVANAM
FISHING IND.
100%
SKELETON
COAST TRAWL.
100%
KALAHARI
TRAWLING
35%
DIAZ FISHING
100%
49%
EYETHU
NOVA
NOVANAM HLG OF
NAMIBIA
49%
DIAZ TRAWL.
40%
100%
NAUTILUS
49%
PROMARISCO
OMUHUKA
100%
100%
NOVAHONDURAS
COASTAL MARINE
DEEP OCEAN
GENDOR RESOUR.
GENDOR FISHING
67%
SERVICONSA
EROS FISHING
LALANDI HLG
100%
EMPIRE TRW.
100%
OYA
100%
CONBAROYA
MANGETTI OYA
98,5%
PESCANOVA
BRASIL
CMI TRAWLING
98,26%
PAMWE FISHING
GENDOR
HOLDING
100%
GLOMAR
100%
99,85%
PESCAFINA
TAMPICO
Share Registration Document
63
VENTURE
7.2. A list of the issuer’s significant subsidiaries, including name, country of
incorporation or residence, proportion of ownership interest and, if
different, proportion of voting power held.
Details of the most significant subsidiary and multi-group Companies (voting
rights in which correspond to the holding) included in the consolidated
PESCANOVA Group are as follows:
%
Holding
FRINOVA, S.A.- Pol.Ind.Gándaras-PORRIÑO-SPAIN
Activity
90.36
Processing and commercialisation of seafood products
Production and commercialisation of seafood products
EIRANOVA FISHERIES LIMITED.- Dinish Island-Castletownbere-CORK-IRELAND
100.00
PESQUERÍAS BELNOVA, S.A.- Florida 1613-MONTEVIDEO-URUGUAY
100.00
Production and commercialisation of seafood products
PESCAFRESCA, S.A.- Puerto Pesquero-Lonja de Altura-Almacén 41/42-VIGO-SPAIN
100.00
Commercialisation of seafood products
NOVAGROUP (Pty) Ltd.- 12th Floor Metlife Centre - 7 Coen Steytler - CAPE TOWN-R.S.A.
92.50
Other services
PESCANOVA FRANCE, S.A.- 1 rue Albert Schweitzer - 14280 Caen - Saint Contest - FRANCE
100.00
Commercialisation of seafood products
PESCANOVA LDA.- Av.da Republica 1 B 4º 1495 110 ALGÉS-PORTUGAL
100.00
Commercialisation of seafood products
PESCANOVA ALIMENTACIÓN, S.A. Rúa José Fernández López-CHAPELA-VIGO-SPAIN
100.00
Commercialisation of seafood products
ARGENOVA, S.A.- Av.Belgrano, 920-924-BUENOS AIRES-REP.ARGENTINA
100.00
Production and commercialisation of seafood products
PESCANOVA ITALIA, S.R.L.- Vía Independenza, 42-BOLOGNA-ITALY
100.00
Commercialisation of seafood products
FRIVIPESCA CHAPELA, S.A.- Rúa J.Fdez.López s/n-CHAPELA-VIGO-SPAIN
100.00
Processing and commercialisation of seafood products
FRIGODIS, S.A.- Jacinto Benavente, 18-2º-VIGO-SPAIN
100.00
Other services
BAJAMAR SÉPTIMA, S.A.- Pol.Ind.Sabón parcela 13-ARTEIXO-LA CORUÑA-SPAIN
100.00
Processing and commercialisation of seafood products
NOVAPESCA TRADING S.L..- Rúa J.Fdez.López s/n-CHAPELA-VIGO-SPAIN
100.00
Other services
PESCAMAR, LDA.- Rúa Bagamoyo s/n-BEIRA-MOZAMBIQUE
70.00
Production and commercialisation of seafood products
ACUINOVA, S.L..- Finca El Dique-AYAMONTE-HUELVA-SPAIN
100.00
Production and commercialisation of seafood products
INSUIÑA, S.L..- Rúa J.Fdez.López s/n-CHAPELA-VIGO-SPAIN
100.00
Production and commercialisation of seafood products
PESCA CHILE, S.A.- Pº Peatonal E.Echaurren 2631 Of.61-PROVIDENCIA-CHILE
100.00
Production and commercialisation of seafood products
AUSTRAL FISHERIES Pty.Ltd.- 14 Neil Street-Osborne Park-6017 PERTH-AUSTRALIA
50.00
Production and commercialisation of seafood products
PESCAFINA, S.A.- Ferraz, 50 – 5ª planta-28008 MADRID-SPAIN
99.00
Commercialisation of seafood products
100.00
Commercialisation of seafood products
PESCANOVA USA- 201 Alhambra Circle Suite 514-33134 MIAMI-FLORIDA-USA
PESCANOVA BRASIL, LDA.- Avda.das Americas 297,sala 201-RIO DE JANEIRO-BRAZIL
98.50
Commercialisation of seafood products
Onteniente,12-Pol.Fuente del Jarro-PATERNA-VALENCIA-SPAIN
PESCAFINA BACALAO, S.A.-
100.00
Processing and commercialisation of seafood products
ULTRACONGELADOS ANTÁRTIDA, S.A.- Páramo,9-Pol.Ind.Villayuda-BURGOS-SPAIN
100.00
Processing and commercialisation of seafood products
NOVA AUSTRAL, S.A..- Pº Peatonal E.Echaurren 2631 Of.61-PROVIDENCIA-CHILE
100.00
Production and commercialisation of seafood products
PESCANOVA HELLAS. Achileos 1 A & Trias Str. 152 35 VRILISSIA-ATENAS-GREECE
100.00
Commercialisation of seafood products
NOVAPESCA ITALIA, S.R.L. Triggiano (BA)-S. Statale 16, Km.810,250-Bari-ITALY
100.00
Other services
SEABEL SAS.-Z.I.s ecteur A 33, Allée des Pêcheurs-6700 ST. LAURENT DU VAR-FRANCE
100.00
Processing and commercialisation of seafood products
SERVICONSA. Reparto la Garnacha, s/n-Chinandega-NICARAGUA
67.00
Production and commercialisation of seafood products
PESCANOVA POLSKA-Sp.z.o.o.- ul.Wladyslawa IV nr 11-70651-SZCZECIN-POLAND
100.00
Commercialisation of seafood products
PESCANOVA JAPON KK
-104-0061Hinoki Ginza Wing 6F 14-5, Ginza 1, Chome, Chuo-Ku - JAPAN
100.00
Commercialisation of seafood products
ACUINOVA ACT.PISCÍCOLAS S.A.- Docapesca de Pedrouços-LISBOA-PORTUGAL
100.00
Production and commercialisation of seafood products
NOVAPERÚ. S.A.C. -Francisco del Castillo 643-2 Barranco-Lima-PERU
100.00
Commercialisation of seafood products
CAMARONES DE NICARAGUA, SACiudad de Chinandenga-Dpto.de Chinandenga.NICARAGUA
100.00
Production and commercialisation of seafood products
FRICATAMAR, S.L.- Fusters s/n-Pol.Ind.d'Obradors-46110 Godella-Valencia - SPAIN
100.00
Production and commercialisation of seafood products
NOVAOCEANO, SA DE CV- c/29 s/n-Col.Punta de Lastre-Guaymas-85430 SONORA-MEXICO
100.00
Production and commercialisation of seafood products
NOVAGUATEMALA, S.A.- Calzada Aguilar Batres,35-35 Zona 12- GUATEMALA
100.00
Production and commercialisation of seafood products
PROMARISCO, S.A..- Km. 6.5 Vía Durán Tambo, Guayaquil-ECUADOR
100.00
Production and commercialisation of seafood products
NOVAHONDURAS, S.A.-Los Mangos Costado Sur Iglesia Sagarada Familia - Choluteca-HONDURAS
100.00
Production and commercialisation of seafood products
Share Registration Document
64
The financial year and closing date of the most recent Annual Financial
Statements coincide with the calendar year and 31 December, respectively,
for all subsidiary and multi-group Companies of the Group.
Subsidiary Companies are consolidated by the global integration method,
including in the consolidated financial statements all of their assets, liabilities,
income, expenses and cash flows after making the adjustments and
eliminations corresponding to intra-Group operations. Subsidiary Companies
are those in which the parent Company controls a majority of voting rights or,
if this situation does not apply, it has power to direct their financial and
operating policies.
The results of subsidiary Companies acquired or disposed of during the year
are included in the consolidated accounts from the effective date of
acquisition or until the effective date of disposal, as appropriate.
Consolidation of operations of the parent Company and consolidated
subsidiary Companies took place in accordance with the following basic
principles:
1. On the date of acquisition, the assets, liabilities and contingent liabilities
of the subsidiary Company are recorded at market value. If there is a
positive difference between the acquisition cost of the subsidiary
Company and the market value of its assets and liabilities, corresponding
to the holding of the parent Company, this difference is recorded as
goodwill. If the difference is negative, it is recorded by crediting the
Consolidated Income Statement.
2. The value of the holding of minority shareholders in the equity and profit
and loss of subsidiary Companies consolidated by global integration are
respectively shown under the headings “Net equity - Of minority
shareholders” in the Consolidated Balance Sheet, and “Profit and loss for
year of minority shareholders” in the Consolidated Income Statement.
3. Conversion of the financial statements of foreign Companies with a
different functional currency to the euro takes place in the following
manner:
a)
Assets and liabilities using the exchange rate in force at the closing
date of the consolidated financial statements.
b)
Items in the Income Statement using the average exchange rate for
the year.
c)
Net equity is maintained at historic exchange rate at the date of
their acquisition (or the average exchange rate for the year of
generation, both in the case of cumulative profit and loss and
contributions made), as appropriate.
Exchange rate differences arising on conversion of financial statements
Share Registration Document
65
are recorded net of their tax effect under the heading “Conversion
differences” within Net Equity.
4. All balances and transactions between Companies consolidated by global
integration have been eliminated in the consolidation process.
The proportional integration method was applied for joint businesses,
meaning contractual agreements pursuant to which two or more
undertakings engage in operations or maintain assets in such manner that
any strategic decision of a financial or operational nature which affects
them requires the unanimous consent of all participants, without such
operations or assets being integrated in financial structures other than
those of the participants. The only company consolidated by proportional
integration is Austral Fisheries Pty. Ltd.
By application of this consolidation method, the aggregation of balances
and subsequent eliminations take place solely in the proportion which the
holding of the Group represents in relation to the capital of these entities.
Assets and liabilities assigned to joint operations and the assets and
liabilities which are jointly controlled with other participants are shown in
the Consolidated Balance Sheet classified in accordance with their specific
nature. In the same manner, income and expenses arising in joint
businesses are shown in the consolidated income statement in accordance
with their nature.
Identification of the most significant associate Companies (voting rights in
which correspond to the holding) is as follows:
%
Holding
Activity
NOVANAM LIMITED- Industry Street -9000 -LÜDERITZ -NAMIBIA
49.00
Production and commercialisation of seafood products
BOAPESCA, S.A.- Primo de Rivera,10-1º-LA CORUÑA-SPAIN
50.00
Other services
HARINAS Y SÉMOLAS DEL NOROESTE , S.A.- P.Ind.Gándaras-PORRIÑO -SPAIN
50.00
Production and commercialisation of special flour
AMERICAN SHIPPING S.A.- Convención 1511 piso 1º-MONTEVIDEO – URUGUAY
19.00
Production and commercialisation of seafood products
ABAD EXIM PVT LTD.- Plot nº 32833 Kakkanad, Cochin-37 INDIA
32.00
Production and commercialisation of seafood products
ABAD OVERSEAS PRIVATE LTD.- Plot nº C 2-SIPCOT -CHENNAI -INDIA
45.00
Production and commercialisation of seafood products
EYETHU NOVA.- 12th Floor Metlife Centre - 7 Coen Steytler - CAPE TOWN-R.S.A
49.00
Production and commercialisation of seafood products
PESQUERA YELCHO, S.A.- Pº Peatonal E .Echaurren 2631 Of.61-PROVIDENCIA -CHILE
33.30
Production and commercialisation of seafood products
Investments recorded by the equity method
Holdings in Companies in which the Group exercises control jointly with
another Company or in which it has a significant influence are recorded
following the equity method. In general significant influence is presumed in
those cases in which the Group has a holding in excess of 20%.
Share Registration Document
66
The equity method consists of recording the holding in the Balance Sheet and
the fraction of its net equity represented by the Group holding in its capital
after adjustment, as the case may be, for the effect of transactions carried out
with the Group plus the latent capital gains corresponding to the goodwill
paid on acquisition of the Company.
If the resulting amount is negative the holding is left at zero in the
Consolidated Balance Sheet unless there is a commitment by the Group to
restore the net equity situation of the Company, in which case the
corresponding provision for contingencies and expenses is made.
Dividends received from these Companies are recorded by reducing the value
of the holding, and the profits and loss obtained by these Companies
corresponding to the Parent Company in accordance with its holding are
incorporated, net of their tax effect, in the Consolidated Income Statement
under the heading “Profit and Loss of Companies by the equity method”.
Share Registration Document
67
8. PROPERTY, PLANTS AND EQUIPMENT
8.1. Information regarding any existing or planned material tangible fixed
assets, including leased properties, and any major encumbrances
thereon.
TANGIBLE FIXED ASSETS
Movements under each heading in the Consolidated Balance Sheet included
under this heading and their corresponding cumulative depreciation and
provisions, are as follows:
Share Registration Document
68
Thousands of euros
Land and
Buildings
Description:
Gross amount at 1 January 2010
Technical
.
Insts.
.
& Machinery
Fleet
Other
Fixed Assets
Advances and
in progress
Total
297,954
371,139
464,987
20,397
192,240
1,346,717
(77,922)
(164,253)
(92,631)
(10,284)
--
(345,090)
220,032
206,886
372,356
10,113
192,240
1,001,627
Additions
7,532
9,315
6,726
381
30,447
54,401
Transfers of non-current assets classified as held for sale
7,039
4,395
2,446
368
2,023
16,271
Removals
(3,753)
(15,381)
(2,497)
(795)
(121)
(22,547)
Others
90,615
47,665
1,821
10,106
(147,655)
2,552
(13,020)
(1,388)
(7,034)
(3,467)
--
(24,909)
88,413
44,606
1,462
6,593
(115,306)
25,768
3,725
15,030
2,309
700
--
21,764
(13,128)
(28,516)
(9,144)
(2,684)
--
(53,472)
1,326
944
1,456
483
--
4,209
(8,077)
(12,542)
(5,379)
(1,501)
--
(27,499)
386,367
415,745
466,449
26,990
76,934
1,372,485
(85,999)
(176,795)
(98,010)
(11,785)
--
(372,589)
300,368
238,950
368,439
15,205
76,934
999,896
Cumulative depreciation, Provisions
and Loss by Impairment at
,
01.01.10
Net amount at 1 January 2010
Transfers to non-current assets classified as held for sale
Sub-total at 31 December 2010
Removals
Depreciation
Transfers to non-current assets classified as held for sale
Sub-total at 31 December 2010
Gross amount at 31 December 2010
Cumulative Depreciation, ,Provisions and Loss by Impairment at
31.12.09
Net amount at 31 December 2010
Share Registration Document
69
Thousands of euros
Land and
Buildings
Description:
Net amount at 1 January 2011
Technical
.
Insts.
& Machinery
Other
Fixed Assets
Fleet
Advances and
in progress
Total
300,368
238,950
368,439
15,205
76,934
999,896
Additions
2,830
2,657
19,186
3,410
39,178
67,261
Net additions from conversion differences
7,036
4,445
4,994
1,169
1,836
19,480
Removals
(3,824)
(8,669)
(2,736)
(1,787)
(177)
(17,193)
Others
67,034
29,579
537
736
(97,899)
(13)
Transfers to non-current assets classified as held for sale
(6,229)
(914)
(13,670)
(4,265)
--
(25,078)
Sub-total at 31 December 2011
66,847
27,098
8,311
(737)
(57,062)
44,457
3,824
8.352
2,680
1,700
--
16,556
(17,733)
(27,028)
(10,900)
(3,704)
--
(59,365)
606
290
2,321
21
--
3,238
Sub-total at 31 December 2011
(13,303)
(18,386)
(5,899)
(1,983)
--
(39,571)
Gross amount at 31 December 2011
453,214
442,843
474,760
26,253
19,872
1,416,942
(99,302)
(195,181)
(103,909)
(13,768)
--
(412,160)
353,912
247,662
370,851
12,485
19,872
1,004,782
Removals
Depreciation
Transfers to non-current assets classified as held for sale
Cumulative depreciation, Provisions
and Loss by Impairment at
,
31.12.10
Net amount at 31 December 2011
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Under the heading of “Land and Buildings” and “Fleet” there are a series of items to
which their market value was assigned as attributed cost at date of transition to IFRS
(1 January 2004), based on their independent expert valuation.
The book value of “Land and Buildings” and “Fleet” if book value had been assigned
as initial attributed value, would be 101.4 million euros and 295.4 million euros,
respectively. The revaluation reserves deriving from these assets amounted to 110
million euros at 31 December 2011 with scarcely any movement since 1 January
2004.
There are no significant fixed assets which are not permanently and directly assigned
to operations.
The different types of production plants of the PESCANOVA Group and their
geographic location are shown below.
Production of the PESCANOVA Group is centred on several production areas which
correspond to fishing grounds where the 90 owned vessels operate (there are no
leased vessels in the Group), the farms for cultivating salmon (Chile), prawn
(Ecuador, Nicaragua, Honduras and Guatemala), tilapia (Brazil) and turbot (Spain
and Portugal) and the 25 plants for processing seafood products. Maps are included
with the location of the different production centres.
Companies of the PESCANOVA Group with fleet
Novaocéano
Nova
Perú
Factory longliners
í
Pescamar
Marnova
NovaNam
Pesca
Chile
Belnova
Argenova
Novagroup
Deep water trawlers
Squid fishing vessels
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71
Austral
Fisheries
Countries with fish farms and Countries with seafood processing plants
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The market value of fixed assets assigned to security at 31 December 2011 amounted
to 86 million euros. The corresponding debts amounted to 55.5 million euros, the
majority long term.
The Group has adequate insurance policies in order to cover possible contingencies to
which its tangible fixed assets are subject.
Leased properties are not significant in either number or in participation in the
production process.
8.2. A description of any environmental issues that may affect the issuer’s utilisation
of the tangible fixed assets.
PESCANOVA engages in its activities in different areas, both in the marine medium
(fishing and marine aquaculture) and on land (production activities and aquaculture
on land) and in the most diverse geographic areas.
These activities are currently regulated sectors in the different countries, and
amongst others there are regulations governing environmental aspects.
PESCANOVA has all licences, permits and authorisations required for the different
state environmental legislations, and therefore there are no environmental aspects
which could affect use of its tangible fixed assets.
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73
9. OPERATING AND FINANCIAL REVIEW
9.1. Financial situation
The information relating to the financial situation of the PESCANOVA Group is
covered in detail in Section 20.
9.2. Operating results
A breakdown is shown below of the operating results of the Consolidated Group at
the end of the last three financial years:
Thousands of euros
2011
Net turnover
Increase in stocks
Other operating income
Operating income
Consumption and reduction of stocks
of products, finished and in progress
Consumption of sales
Reduction in stocks
Reduction in stocks to
sales
Personnel expenses
Personnel expenses to sales
Provisions for depreciation
Other operating expenses
Other operating expenses to
sales
Operating expenses
EBITDA
EBITDA to net
turnover
CONSOLIDATED OPERATING
PROFIT
Operating profit to turnover
1,670,664
15,057
16,100
1,701,821
1,117,968
66.92%
% Variation % Variation
09-10
10-11
6.24%
6.76%
2010
1,564,825
2009
1,472,976
23,217
21,355
23,150
-35.15%
-24.61%
100.00%
-7.75%
1,609,397
1,496,126
5.74%
7.57%
1,057,593
971,465
5.71%
8.87%
67.59%
65.95%
13,174
-100.00%
0.89%
168,723
10.10%
61,671
231,604
160,012
149,172
10.23%
10.13%
56,883
13.86%
1,579,966
183,526
5.44%
7.27%
48,022
8.42%
18.45%
228,443
212,606
1.38%
7.45%
14.60%
14,43%
1,502,931
1,394,439
5.13%
7.78%
163,349
149,709
12.35%
9.11%
10.99%
10.44%
10.16%
121,855
106,466
101,687
14.45%
4.70%
7.29%
6.80%
6.90%
Evolution of Group turnover in the last eight financial years is shown below:
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74
Consolidated turnover
1800
1600
1400
1200
1000
800
600
400
€m)
CAGR: 8.7% (2004- -2011)
933
999
1,133
1,293 1,343
1,670
1,473 1,565
2004 2005 2006 2007 2008 2009 2010 2011
During 2009 the PESCANOVA Group continued to consolidate its business strategy,
both in the area of extraction and production of products of fishery origin and in the
area of markets, strengthening its brand activity in an ongoing effort to establish itself
more solidly in the resources-markets binomial with strategic positioning in locations
with sustainable competitive advantages and markets where the PESCANOVA brand
permits price differentials for its products. This has all enabled the figure of 1.472
billion euros of consolidated turnover to be exceeded.
During the 2010 financial year consolidated turnover of the Group amounted to 1.565
billion euros (6.2% higher than the previous year).
During the 2011 financial year the consolidated turnover of the Group amounted to
1.670 billion euros (6.7% higher than the previous year).
During the 2011 financial year obtaining resources through fishing exceeded 100,000
tonnes of fish, which meant maintaining the fishing quotas of the Group. In parallel,
market shares of the PESCANOVA brand in the frozen foodstuffs sector in Spain
(Kantar Worldpanel and Ministry of Agriculture, Foodstuffs and the Environment, in
accordance with Section 6.2 Spanish Market) maintained the growth line with respect
to the previous year at the same time that the market for seafood products also grew
(2% Kantar Worldpanel an Ministry of Agriculture, Foodstuffs and the Environment).
Furthermore, in the area of fishery resources, as an integral part of risk diversification
and development of industrial capacity in the fishing field, the Group during 2011
intensified its R&D activities in prospecting for new profitable and sustainable fishing
grounds. In the area devoted to the development of aquaculture the process continued
of research and improvement of land and underwater farming conditions. Research
and development outlay recognised as expense for the 2011 financial year amounted
to 5.7 million euros (in 2010 it amounted to 5.8 million euros).
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As part of its fishing vocation which led to its formation 51 years ago, PESCANOVA
has been and continues to be aware of the major importance to the industry of a
suitable strict legal and biological regulation of marine resources, as the only path to
stability of a sustainable annual catch.
The Group has participated actively with Governments of the countries where it
carries out fishing activities for a progressive and better legal and biological
regulation of their marine resources. This philosophy of conservation and
rationalisation of fishing activities has and today continues to constitute one of the
strategic pillars of PESCANOVA industrial activities, enabling it to look forward with
a high degree of optimism to the future of fishing resources where investments have
been made over the course of recent decades.
With respect to the figures which summarise the economic activity of the Group in
2011, we could highlight that consolidated turnover amounted to 1.670 billion euros,
which generated gross consolidated funds (EBITDA) in the amount of 183.5 million
euros (12.4% higher than 2010).
The PESCANOVA Group, since its foundation in 1960, has sought protection and
improvement of the environment, either directly through its own investments in
resources which facilitate maximum respect for nature, or by pressing for the
enactment of laws and regulations which protect it. In the first case, all factories and
vessels of the Group are equipped in order to achieve maximum respect for the
environment, whilst in the second case, and given the fishing activity of the Group,
maximum preservation of the natural fishing wealth of seas is sought by delineating
catches and creating sufficiently long prohibition periods to maintain the fishing
grounds in which PESCANOVA participates in suitable manner year after year.
Provisions are made for depreciation of 61.6 million euros, 8.4% more than the
previous year, and with ordinary activities obtaining a profit of 121.8 million, 14.5%
higher than the previous year. The results after provisions for corporate income tax
amounted to 50.1 million, representing an increase of 38% over the previous year.
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76
The evolution of EBITDA for the financial years between 2004/2011 are shown in the
following chart.
EBITDA and EBITDA Margin ( €m.%)
200
180
160
140
120
100
80
60
40
20
0
CAGR: 15.8% (2004-2011)
9.0%
9.7% 9.5%
10.3% 10.2% 10.4%
11.0%
10%
7.0%
65
12%
8%
89
122
110
138
150
163
183
6%
4%
2%
0%
2004 2005 2006 2007 2008 2009 2010 2011
EBITDA increased from 110.1 million euros in 2006 to 122.4 million in 2007, 138.4
million in 2008 and 149.7 million in 2009, 163.3 million in 2010 and 183.5 million in
2011, in percentage terms from 9.5% of sales in 2007 to 10.9% in 2011.
Turnover and EBITDA for each segment is shown below:
FOODSTUFFS
(Thousands of euros)
2011
2010
2009
Turnover
1,630,578
1,532,568
1,445,257
EBITDA
180,886
161,386
147,976
2011
2010
2009
Turnover
40,086
32,257
27,719
EBITDA
2,640
1,963
1,733
SERVICES
(Thousands of euros)
9.2.1 Information regarding significant factors, including unusual or infrequent
events or new developments, materially affecting the issuer’s income from
operations, indicating the extent to which income was so affected.
There have been no significant factors which have substantially affected the
operating income of the PESCANOVA Group.
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77
9.2.2 Where the financial statements disclose material changes in net sales or
revenues, provide a narrative discussion of the reasons for such changes.
There have been no material changes in net sales or income of the PESCANOVA
Group.
9.2.3 Information regarding any governmental, economic, fiscal, monetary or
political policies or factors that have materially affected or could materially
affect, directly or indirectly, the issuer’s operations.
Despite the difficult international economic situation, there have been no factors of
economic, fiscal, monetary or political origin which have affected operations of the
PESCANOVA Group.
Potential risks of this nature which could affect Group supplies are highly tempered
by engaging in fishing activities in countries with proven political stability and
absence of concentration of species in countries which could hamper supplies.
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78
10. CAPITAL RESOURCES
10.1 Information concerning the issuer’s capital resources (both short and long
term).
Details are set out below of the Net Equity and Liabilities of the Consolidated Group
at 31 December 2009, 2010, 2011 and the first quarter of 2012, obtained from the
Balance Sheets at the end of the corresponding financial period. The information was
prepared in accordance with the IFRS adopted by the European Union.
Short and long term capital resources
Thousands of euros
st
1 Quarter
2012 (*)
116,683
57,043
330,384
(6,936)
(4,315)
(1,967)
9,042
499,934
2011
116,683
57,043
285,234
(6,434)
4,911
(1,967)
50,140
505,610
2010
116,683
57,043
245,114
(4,734)
828
(2,747)
36,297
448,484
2009
116,683
57,043
219,442
(3,778)
(2,582)
(2,901)
32,091
415,998
25,311
525,245
109,655
346,525
293,534
121,320
40,319
496
911,849
26,280
531,890
111,522
244,704
390,059
125,320
50,048
2,622
924,275
28,682
477,166
119,677
104,254
395,543
120,046
67,980
3,450
810,950
28,461
444,459
125,831
0
338,977
102,513
66,604
8,722
642,647
Debts to credit institutions
184,203
196,041
172,418
306,068
Trade creditors and other accounts payable
485,965
487,242
596,426
559,143
Subscribed capital
Issue premium
Other reserves
Hedging operations
Conversion differences
Treasury shares
Profits attributable to the parent Company
Net equity of the parent Company
Net equity of minority shareholders
Net equity
Subsidies
Bonds and Other Negotiable Securities
Debts to credit institutions
Other financial liabilities without recourse
Non-current liabilities
Provisions
Non-current liabilities
Other financial liabilities
Other current liabilities
Current liabilities
Total Liabilities
Total Liabilities + Net Equity
Financial Debt with recourse, short term
Financial Debt with recourse, long term
Gross financial debt with recourse
NFD (Net Financial Debt) with recourse, total
Net Financial Debt, total (With + Without Recourse)
Financial Debt with recourse ST/Financial Debt with recourse, total
NFD / Net Equity
NFD / EBITDA
1,510
4,803
2,170
2,293
131,012
123,664
123,701
132,230
902,026
991,168
795,379
820,316
1,633,815
1,707,228
1,744,591 1,712,976
2,232,473
2,276,481 2,190,142
2,078,274
172,418
306,068
184,203
196,041
640,059
634,763
499,797
338,977
672,215
645,045
824,262
830,804
709,557
688,168
540,768
545,144
832,387
818,291
662,984
649,950
22%
24%
26%
47%
135%
129%
113%
123%
3.78
EBITDA / Financial expenses (without exchange rate differences)
3.75
3.31
3.64
3.1
3.2
3.1
2.9
Cash and Banks
(114,705)
(142,636)
(131,447)
(99,901)
EBITDA
187,564
183,526
163,349
Financial expenses
Exchange rate differences
Financial expenses (without exchange rate differences)
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79
149,709
(58,775)
(55,397)
(53,507)
(54,388)
1,060
1,246
(1,163)
(2,810)
(59,835)
(56,643)
(52,344)
(51,578)
(*) Data from the Income Statement, used in the ratios, is not quarterly, but annual.
Variation in the principal figures included in the above table are examined below:
a) Own funds:
The principal changes occurring during the financial years referred to relate to
allocation to Net Equity of that part of profit and loss from the previous year not
distributed.
During the 2009 financial year a capital increase took place of 38.7 million euros
with gross issue premium in the amount of 61.9, which is explained in more
detail in the section on Net Equity.
b) Outside funds:
Variations on 31 March 2012
During the first quarter current liabilities were reduced by 12.4 million mainly as
a result of the issue of bonds in the amount of 160 million and reduction of 53.5
million of bonds issued in 2010 and 2011, and reduction in credit included in
debts to credit institutions in the amount of 96.5 million. Furthermore, long term
liabilities were also reduced by 9.7 million.
Current liabilities were reduced by 25 million, of which 11.8 relate to debts to
credit institutions.
Variations in 2011
During 2011 an increase took place in non-current liabilities of 113.3 million
euros, which in particular include the issue of convertible bonds in April 2011 in
the amount of 180 million, of which further details are provided in section 21.1.4.
Financial debt without recourse grew by 5.3 million, reaching 125 million euros
long term. A syndicated facility was refinanced in the amount of 150 million
euros with final maturity in 2015.
Short term debts to credit institutions increased by 23.6 million.
Variations in 2010
During 2010 an increase took place in non-current liabilities of 168.3 million
euros, which particularly included the issue of convertible bonds in March 2010
in the amount of 110 million, of which further details are provided in section
21.1.4, and to a lesser extent the restructuring of part of short to long term
liabilities which involved a net increase of 56.5 million euros. Financial debt
without recourse grew by 17.5 million, reaching 120 million euros long term. The
restructured liabilities referred to correspond to two syndicated loans/facilities in
nominal amounts of 105 and 75 million euros, with European banks and savings
banks which matured in 2010, the new final maturity of which is 2015, operations
which were closed on financial terms similar to the original.
On the other hand, short term debt to credit institutions fell by 133.6 million.
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80
Variations in 2009
The principal movements in 2009 were:
o Decrease in non-current liabilities of 113 million euros, from 755.4 million to
642.6 million euros. This reduction in non-current outside funds was basically
due to:
a1) Decrease in non-current financial debt with recourse, which moved from
482.5 million euros to 339 million, a reduction in debt of 142.5 million, the
principal reason for which was the transfer of debt from long to short term.
a2) Increase in deferred income from subsidies for fixed asset investments which
increased from 117.7 to 125.8 million euros in 2009.
a3) Increase in long term financial debt without recourse, from 85.9 to 102.5
million euros during 2009, due to financing of the last construction stage of
the turbot fish farm in Portugal.
o Increase in short term liabilities, from 988.7 to 991.2 million euros during
2009. This increase was basically due to:
a1) Growth in current financial debt with recourse, from 250.3 to 306.1 million
euros, as a result of the reclassification of long term liabilities.
a2) Reduction under the heading “Trade creditors and other short term accounts
payable” plus other current liabilities, from 735.1 million to 682.8 million, as
a result of the lesser effect of purchases and expenses associated with
investments in fixed assets.
10.2 An explanation of the sources and amounts of and a narrative description of the
issuer’s cash flows.
A
Evolution of Working Capital.
The following table shows the evolution of working capital during the first quarter of
2012 and the 2011/2009 period.
(Thousands of euros)
Current assets
Current liabilities
Working capital
Share Registration Document
1st
Quarter
2012
1,113,680
795,379
318,301
81
2011
2010
1,156,338 1,066,973
820,316
902,026
336,022
164,947
2009
948,592
991,168
(42,576)
B
Consolidated Cash Flow Statement.
For better understanding of cash flows, the table below is provided which shows cash
and bank flows of the Consolidated Group for the years 2009, 2010, 2011 and the first
quarter of 2012.
Consolidated cash flow statement
Thousands of euros
31/03/2012
Gross profit and loss before tax and outside shareholders
Depreciation
2011
2010
2009
9,886
64,776
49,684
45,504
15,080
61,671
56,883
48,022
Profit and loss on discontinued operations
(65)
(1,181)
(1,531)
(4,508)
Profit and loss on sales of assets
(96)
(588)
(551)
(5,763)
(864)
(13,174) (11,293)
(8,412)
(13,578)
(8,262) (10,512)
8,682
Corporate income tax
Other profit and loss which does not generate movement of funds
Funds generated by operations
10,363
Variation in current operating assets/liabilities
NET CASH FLOWS FROM OPERATING
ACTIVITIES
Acquisition of tangible and intangible fixed assets
Disposals of assets and receipts from investments
Disposals of other investments
5,026
15,389
(14,068)
83,525
(192,217) (49,628) (53,979)
(88,975)
33,052
29,546
(68,790) (66,744) (134,447)
12,610
31,362
15,463
3
6,406
7,438
13,542
(1,470)
(4,346)
3,336
(14,846)
Issue/redemption of Equity instruments
(4,908)
(1,120)
191,607
Repayment of long term financial debt
82,680
339
Subsidies and other deferred income
NET CASH FLOWS EMPLOYED IN
INVESTMENT ACTIVITIES
Drawdown of long term financial debt
103,242
(51,244) (32,290) (102,106)
12,568
6,097
95,726
447,485 294,412
85,396
(190,312) (307,245) (128,578) (212,355)
Net flow of financial debt with short term maturity
Payment of dividends to the parent Company
(15,132)
---
Other receipts/(payments) from financing activities
26,256 (133,772) 54,774
(9,724)
(8,751)
(5,850)
(9,729)
(17,932)
1,376
4,577
NET CASH FLOWS FROM FINANCING ACTIVITIES
(28,474)
151,408
30,784
22,268
TOTAL NET FLOWS
(27,931)
11,189
31,546
(50,292)
31,546
(50,292)
VARIATION IN CASH AND OTHER LIQUID ASSETS
(27,931)
11,189
INITIAL CASH AND OTHER LIQUID ASSETS
142,636
131,447
FINAL CASH AND OTHER LIQUID ASSETS
114,705
142,636 131,447
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82
99,901 150,193
99,901
Variations at 31 March 2012
During the first quarter of 2012 in particular there was cash generation from operating
activities in the amount of 15.4 million deriving from the positive variation in
working capital (over 5 million) which meant a significant change in relation to the 12
previous months in which a negative variation was generated of 192 million.
In parallel, investments in tangible and intangible fixed assets amounted to 14.1
million, in line with the Group strategy of investing below depreciation in the period.
Variations in 2011
Funds generated by operating activities.
Profit and loss for the year and depreciation provisions enabled funds of 103.2 million
euros to be achieved, of which 192.2 million were consumed during the year in
financing current assets, with mention principally of the increase in biomass (live fish
and crustaceans in the different farms) by 77.1 million, financing provided by fish
trade creditors as a result of the higher own production in fish farms of the
PESCANOVA Group, as forecast in the consolidation generated by the vertical
integration of the Group.
Application of funds to investment activities, 69.1 million (compared with 30.9
million applied in 2010) is in line with the figure for depreciation.
Variations in 2010
Funds generated by operating activities.
Profit and loss for the year and depreciation provisions enabled funds of 82.7 million
euros to be achieved, of which during the year 49.6 million were consumed in
financing current assets, including principally the increase in biomass of 68.6 million
of which part was financed by the increase in the balance with trade suppliers, at the
same time reducing the need for current financing by reduction of other stocks such as
raw materials and finished products.
However, the application of funds was investment activities was contained, with a
reduction to just 30.9 million (against 97.5 million applied in 2009).
In this manner the generation of funds after operating activities and investments was
positive.
Variations in 2009
The most significant variations in 2009 relate to the following net flows:
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83
-
Funds generated by operations.
During 2009 the highest figure in recent years was obtained, which meant
generation of 83.5 million euros, 21% higher than in the previous year, the
principal component of which was obtained from gross profit before tax and
depreciation which overall amounted to 93.5 million compared with 79.7 million
euros, a 17% increase.
-
Net cash flows used in investment activities.
A significant improvement can be seen with respect to the previous year with a
reduction by 115 million in financing requirements as a result of investments now
completed and in progress. In addition, as mentioned in other sections, these
investment flows fell much more during 2010 since the main investments were
considered virtually completed.
-
Issue of Equity Instruments.
These relate to subscriptions for the share issue which meant a net increase in
incoming flows of 95.7 million euros.
C
Most significant indices.
AVERAGE CUSTOMER COLLECTION PERIOD
Meaning the average balance of the figure for customers from sales and provision of
services with respect to total sales turnover in each year.
(Thousands of
euros)
1st
quarter
2012
2011
2010
%
%
Variation Variation
10-11
09-10
2009
Average customer
243,280
260,723
253,307
248,649
balance
1,692,053
1,670,664 1,564,825 1,472,976
Net sales
Average collection
period (days)
52
57
59
62
2.93%
6.76%
1.87%
6.24%
-3.59%
-4.11%
STOCK ROTATION
Meaning net sales with respect to average stock.
(Thousands of euros)
Net sales
Average stock balance
Stock rotation
Share Registration Document
1st
quarter
2012
2011
2010
1,692,053 1,670,664 1,564,825
%
%
Variation Variation
2009
10-11
09-10
1,472,976
6.76%
6.24%
640,890
627,707
538,911
500,567
16.48%
7.66%
2.64
2.66
2.90
2.94
-8.34%
-1.32%
84
10.3 Information on the borrowing requirements and funding structure of the issuer.
In the breakdown of financial debt of the Group (previous Section 10.1), the most
significant item is that of debts to credit institutions, a source of financing which is
examined below.
Debt to Financial Institutions during the period examined was basically subject (75%)
to variable interest rates.
Variations in amounts and structure of financing in 2011 were basically due to the
growth in debt in respect of bonds, which increased to 244.7 million as a result of the
issue of convertible bonds, partly applied to early cancellation of bonds from the issue
in force at the beginning of the year, the conversion price of which was equal to or
less than that of the PESCANOVA share listing. The funds were applied to financing
the increase in biomass and other working capital requirements.
The breakdown of debts to credit institutions at 31 March 2012, 31 December 2011,
2010 and 2009 in accordance with their terms, was as follows:
(Thousands of euros)
Non-current financial debt
Bonds and other negotiable
securities (*)
Debts to credit institutions with
recourse (long term)
Debts to credit institutions
without recourse/other financial
liabilities (long term)
Current financial debt
Debts to credit institutions with
recourse (short term)
Debts to credit institutions
without recourse/other financial
liabilities (short term)
TOTAL
1st
quarter
2012
2011
2010
2009
761,379
760,083
619,843
441,490
346,525
244,704
104,254
293,534
390,059
395,543
338,977
121,320
185,713
125,320
200,844
120,046
174,588
102,513
308,361
184,203
196,041
172,418
306,068
1,510
947,092
4,803
960,927
2,170
794,431
2,293
749,851
(*) In accordance with value recorded as long term debt. The difference up to 369.3 million is shown in own
funds.
The increases in financing in the 2011, 2010 and 2009 financial years were devoted
basically to investments in the turbot fish farming field (Xove and Mira) and prawn
farming (Central America), as dealt with below and in Section 20.1.
Within the consolidation perimeter there are holdings in various companies whose
objects in general are to engage in a specific activity, the financing formula for which
is through project financing without recourse.
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85
The projects financed under the Financing without Recourse mode at the end of the
2011 financial year are the fish farming projects belonging to the companies Insuiña,
S.L. located in Spain and Acuinova Actividades Piscícolas, S.A., in Portugal, both
100% owned. Cancellation of the Financing without Recourse Applied to Projects is
planned between 2012 and 2023 in accordance with the forecasts of cash flow to be
generated by the projects.
The breakdown of financial debt at 31 March 2012, in accordance with its maturity,
was as follows:
Debts to Credit
Institutions
( Millions of euros)
Financial debt with recourse
Up to
31.03.2013
Rest of
2013
2014
2015
2016
Following
Total
184.2
84.4
92.9
83.0
17.1
16.1
477.7
Financial debt without recourse
1.5
6.9
8.9
11.1
11.2
83.3
122.9
Convertible bonds
0.0
0.0
0.0
46.3
0.0
300.2
346.5
185.7
91.3
101.8
140.4
28.3
399.6
947.1
TOTAL
The most significant variation in the first quarter of 2012 was the issue of bonds in the
amount of 160 million euros.
Interest accrued at 31 December 2011 and pending payment at that date amounted to
6.3 million euros and is included in financial debt with maturity in 2011.
Interest on the debt to credit institutions is paid monthly or quarterly, whilst that of the
convertible bonds is settled by half-yearly periods, the cost thereof corresponding to
the EURIBOR plus an average margin of 2.75% for the debt to credit institutions and
6.75% for the convertible bonds, 2015 bonds, 5.125% for the 2017 bonds and 8.75%
for the 2019 bonds.
The average interest rate on the debt to credit institutions during the 2011 financial
year was 6.97%, in 2010 it was 6.83% and during 2009 it was 7.21%.
Net Financial Expenses of the Group during the 2011 financial year amounted to
54.976 million euros, and in 2010 to 47.416 million euros. This amount includes
6.384 million euros accrued and pending settlement (2.298 million euros in 2010 and
1.603 million euros in 2009).
At 31 December 2011, current financial debt to credit institutions represented 21% of
total financial debt to credit institutions.
Of the 200.8 million euros of current debt, 95% comprises loans and operating
facilities with maturity within a year which is renewed regularly.
The amount available under credit facilities at the end of the 2011 financial year in
Group Companies amounted to over 236 million euros, at the end of 2010 to 275
million euros, and 330 million euros at the end of 2009.
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86
The financial debt of the Company contains normal covenants in agreements of this
nature, and to date the ISSUER has not at any time been in a situation of default in its
financial obligations or of any other type which could give rise to a situation of early
maturity of its financial commitments.
HEDGING OPERATIONS AND DERIVATIVE INSTRUMENTS
The derivatives maintained by the Group relate to operations to insure interest rates
and have the purpose of eliminating or significantly reducing these risks in the
underlying operations which are the subject of hedging.
At 31 March 2012 the Group held interest rate insurance contracts treated as hedging
insurance.
The principal characteristics of the contracts were as follows:
Amounts of
underlying
Description of the
Type of derivative
Hedging
Period
insured
2023
88,278
Reasonable
value
31/03/12
Cash flow hedging
Interest Rate Swap
Cash flows
(9,470)
(Data in thousands of euros)
The impact recognised in the first quarter of 2012 on consolidated net equity deriving
from valuation of positions open at 31 March 2012 under the said contracts meant a
reduction of 587 thousand euros. At 31 March 2012, the balance of the hedging
reserve amounted to -7.021 million euros.
MARKET RISK SENSITIVITY ANALYSIS.
Interest rate risk: derives from the financial debt basically referenced to the
EURIBOR. The sensitivity analysis carried out by the Group with respect to the
interest rate risk to which it is exposed is detailed below:
Description
Variation in interest rate
by 50 basis points
31/03/2012
P&L
Equity
± 5%
± 0.5%
31/12/2011
P&L
Equity
± 5%
± 0.5%
Exchange rate risk: The monetary policy followed by the Group is aimed at reducing
any impact deriving from variation in currency exchange rates. The majority of Group
income is produced in the euro area where 75% of Group sales are concentrated. A
similar amount by percentage (78%) is used in the currency in which financial debts
are established.
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Our payment obligations in currencies other than the euro are approximately 29% of
the total and our flows in currencies other than the euro are approximately 23% of the
total.
Debts in foreign currencies by type of currency in which they are contracted
amounted, at 31.03.2012, to 197.3 million euros (210.1 at 31.12.2011) of which 172.8
million (184.9 at 31.12.2011) relate to debts in US dollars and the remaining 24.5
(25.2 at 31.12.2011) to various debts in yen, meticais, Namibian dollars and
Australian dollars.
In relation to risks deriving from costs generated in currencies other than the
functional currency, these are very diversified (over 15 countries) and therefore any
variation in any of these currencies against the euro would not have a significant
impact on profit and loss accounts or consolidated equity. Since these countries are in
very distant geographic zones, it is very remote that parity between them all would
evolve in a direction contrary to that of the Group’s functional currency.
The sensitivity analysis carried out with respect to exchange rate to which the Group
is exposed is as follows:
Description
Variation in quotation of currencies
with respect to the euro by 5%
31/03/2012
P&L
Equity
± 1%
± 0.1%
31/12/2011
P&L
Equity
± 1%
± 0.1%
10.4 Information regarding any restrictions on the use of capital resources that have
materially affected or could materially affect, directly or indirectly, the issuer’s
operations.
Part of the financial debt of the Group contains normal financial covenants in
agreements of this nature.
At the date of Registration of this Document, neither PESCANOVA, S.A. nor any of
its relevant subsidiaries is in a situation of default of its financial obligations or any
other type of obligation which could give rise to a situation of early maturity of its
financial commitments. During the 2011 financial year no default took place in
payment of principal and interest or other defaults, nor was any waiver requested.
At the end of the 2011 financial year all covenants had been complied with.
37% of the balances on financial debts with recourse correspond to loans and
facilities syndicated amongst several banks and savings banks headed by the bank
EBN Banco, which contain clauses with financial obligations which have been
permanently complied with since their grant and which relate to gearing ratio and
interest coverage ratio.
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88
The ratios to be complied with are:
•
•
•
Net Debt with recourse/Equity < 1.8
EBITDA/Financial Expenses >3
NFD with recourse/EBITDA <4
In the event of non-compliance with these coefficients, the Company could be
obliged to cancel loans early.
None of these syndicated facilities contain restrictions on free use of assets or
payment of dividends, or any others.
The financial debts with security in rem granted to Companies included in the
consolidation perimeter amounted, at 31.12.2011, to 55.5 million euros, for which
security was instrumented over fixed assets with a valuation amounting to 86 million
euros, being different vessels, buildings and other financial securities.
During the 2010 financial year two syndicated loans/facilities were renewed in
nominal amounts of 105 and 75 million euros, with European banks and savings
banks, with a new final maturity in 2015, operations which were closed on financial
conditions similar to the original ones. These syndicated facilities, as with the original
ones renewed, do not contain any type of restriction or additional security.
10.5 Information regarding the anticipated sources of funds needed to fulfil
commitments referred to in items 5.2.3. and 8.1.
At 31 December 2011, a total of 266.7 million euros (183.3 in land and buildings,
82.3 in plants and 1.1 in fixed assets in progress) related to fixed assets in projects
financed by “Project Finance”. These fixed assets secure repayment of the loans by
which they are being financed.
After completion of construction of the Mira project, there are no commitments to
significant acquisitions of tangible fixed assets, or other investments.
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89
11. RESEARCH AND DEVELOPMENT, PATENTS AND LICENCES
11.1 Description of the area and its activities.
The R&D&i Area of the PESCANOVA Group comprises more than 80 experts in
three central departments of the Parent:
•
•
•
Fleet Technical Department
Aquaculture Technical Department
Foodstuffs Technical Department
and in the different New Product Departments and Technical Offices of each of the
Group undertakings.
The Technical Departments of the Parent basically carry out tasks of management,
coordination and integration of tasks and projects with different Departments of
Group companies, as well as heading up cross projects which can involve several
production units, as well as integrated projects which involve of different production
units within the value chain of the Group itself.
Furthermore, the Technical Departments of the Parent provide technical support to all
Group businesses in relation to process improvement, implementation of new
production schemes, incorporation of new technologies, technological monitoring,
legal advice and aspects relating to intellectual property, etc.
11.2 R&D&i Policies.
The R&D&i policy of the PESCANOVA Group is based on:
•
•
•
•
Seeking new sources of protein of marine origin and better use of that already
used.
Ongoing improvement of processes and products in the market, based on
application of the most recent available technologies and ad hoc research for each
product type.
Development of new foodstuffs solutions based on those attributes most relevant
to the consumer.
The implementation of more energy efficient production systems.
For which:
Market Studies are regularly carried out –in those markets in which the Company
operates– and Consumer Tests, as well as systematic Technologyl Monitoring in areas
of most interest.
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90
Different research products are being continuously carried out, in different areas, in
collaboration with national and international Research Groups of prestige and
different Universities and Technology Centres, as well as active participation in
Technology Platforms and Associations related to the policies indicated.
Different pilot plants are maintained in operation in several Group Companies and
specific tests are carried out in external Laboratories and Development Centres of
different specialist areas.
The most recent available techniques in relation to studies and areas of interest are
implemented in Group laboratories.
11.3 Table of R&D investment and expenditure.
A table is shown below with the investment and expenditure in R&D&i in the last
three financial years of the PESCANOVA Group:
Millions of euros
TOTAL
2011
2010
2009
5.7
5.8
5.4
The Group has intensified its R&D activities in prospecting for new areas of
profitable and sustainable fishing.
In the area devoted to the development of aquaculture, the process continues of
research and improvement into land and underwater cultivation conditions.
PESCANOVA deploys ongoing efforts in innovation, adapting its portfolio of
seafood products to new consumer requirements, in terms of both product and in
presentation and manner of conservation.
The focus of innovation in PESCANOVA is centred on the principal current
consumption vectors:
o Health (products which help consumers to feel better/care for themselves)
o Convenience (products which are easier and quicker to prepare)
o Pleasure (products which are tasty, delicious, etc.)
Innovation has focused on research into the benefits of seafood products and health,
giving rise both to the launch of new products –new gluten-free product line– and
improvement of current products.
From the point of view of new products, developments have translated into launches
in all frozen product portfolios as well as increase in the range of refrigerated
products.
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91
Innovation in research has meant demonstrating the significant presence of Omega 3
oil acids in hake, both natural and in its different forms of preparation, breadcrumb
and batter coated, and its relationship to health, with hospital studies already
concluded and others still in progress.
Research into Omega 3 content in hake has enabled the Company clearly to
communicate through its advertising and packaging the natural content of Omega 3 in
PESCANOVA natural hake, and in the Grumete PESCANOVA range of breaded or
battered hake products, supporting the nutritional message to children relating to this
range of products.
Research continues into the presence of Omega 3 oil acid and other compounds of
nutritional interest in other fish species or commercial products of interest such as
crustaceans, cephalopods or surimi.
Focusing on the consumption vector of Convenience, the whole range of prepared and
battered fish has been relaunched, adapting its preparation to the oven, which provides
consumers with an easier and healthier form of preparation.
Frozen natural fish has been subject to innovation in freezing processes, introducing
ongoing improvements which enable better and quicker freezing of hake products
which guarantee improved quality of our products. Furthermore, the available offer in
species has been increased, giving consumers other fish such as cod, monkfish and
pink bream.
In the PESCANOVA Surimi range, there has been innovation in improvement of the
use and functionality of the product, introducing products such as Tronquitos (surimi
sticks), Anguriñas (surimi baby eels) and Muslitos (surimi mixture) in portions, both
frozen and refrigerated. The launch can be emphasised of a range of surimi products
with 0% fat.
Innovations have been developed in formulation and particular processes which
permit the current offering of all products of the range without gluten, suitable for
people with celiac syndrome.
In frozen Shellfish, particularly prawns, investment in farming by the Group and
innovation in origin and processes guarantee the quality and stable supply of products
around the year with maximum freshness and in presentations, both for cooked and
uncooked products, adapted to the needs of Spanish consumers, whether frozen, fresh
or refrigerated.
PESCANOVA thus currently commercialises under its brand frozen prawns in
different presentations, and at the same time does so with the packaged refrigerated
product and in presentations for sale in fishmongers.
With respect to patents, the Group does not hold any significant patents of interest.
The Group commercialises its products principally under the PESCANOVA brand,
with the remaining brands used not being significant.
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92
12. TREND INFORMATION
12.1 The most significant recent trends in production, sales and inventory, and costs
and selling prices since the end of the last financial year to the date of the
registration document.
Information relating to the 2011 financial year is set out in Section 20.6.1 of this
Document.
No significant variations have taken place at the date of Registration of this
Document.
12.2 Information on any known trends, uncertainties, demands, commitments or
events that are reasonably likely to have a material effect on the issuer’s
prospects for at least the current financial year.
The information requested can be found in Risk Factors, Section 0, and in Section 20
of this Registration Document.
Furthermore, on 22 June 2012, the Board of Directors of PESCANOVA, S.A. resolved
to float on the Santiago de Chile Stock Exchange its subsidiary Acuinova Chile, S.A.,
the company which heads its salmon aquaculture activities, which would mean placing
amongst others investors a percentage not exceeding 49% of the share capital of
Acuinova Chile, S.A., through an operation (Public Offering) for sale of shares and
increase in capital of Acuinova Chile, S.A.
The purpose of this operation, which will take place before the end of the first quarter
of 2013, is to finance growth in the salmon business area, maintaining and at the same
time strengthening its equity.
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93
13. PROFIT FORECASTS OR ESTIMATES
PESCANOVA has elected not to include profit forecasts or estimates in this
document.
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94
14. ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES AND SENIOR
MANAGEMENT
14.1 Names, professional addresses and functions in the issuer of the following
persons, and an indication of the principal activities performed by them outside
that issuer, where these are significant with respect to that issuer:
a) Members of the administrative, management or supervisory bodies:
In accordance with Article 33 of the Articles of Association of PESCANOVA, the
Board of Directors will comprise a minimum of three and a maximum of fifteen
members. At the date of Registration of this Document the number of members of
the Board of Directors is thirteen, and the name and function of each member is as
follows:
Name
Mr. Manuel Fernández de Sousa-Faro.
Mr. Alfonso Paz Andrade
Mr. Robert A. Williams
ICS HOLDINGS LIMITED (represented by Mr.
Fernando Fernández de Sousa-Faro)
Mr. Antonio Basagoiti García - Tuñón
Mr. Yago Méndez Pascual
Inverlema, S.L. (represented by Mr. Pablo Javier
Fernández Andrade)
Liquidambar Inversiones Financieras, S.L.
(represented by Mr. Javier Soriano Arosa)
Iberfomento, S.A. (represented by Mr. José
Antonio Pérez-Nievas Heredero)
Sociedad Gallega de Importación de Carbones,
S.A. (represented by Mr. Jesús C. García
García)
Ms. Ana Belén Barreras Ruano.
Mr. José Carceller Arce
Luxempart, S.A. (represented by Mr. François
Tesch)
Share Registration Document
Business Address
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
Rúa de José Fernández López s/n,
36320, Chapela, Redondela
(Pontevedra)
95
Position
Chairman
Type
Executive
Member
Designated (*)
Member
Independent
Member
Designated (*)
Member
Independent
Member
Independent
Member
Designated(*)
Member
Designated(*)
Member
Designated(*)
Member
Designated(*)
Member
Designated(*)
Member
Designated(*)
Member
Designated
* Mr. Alfonso Paz Andrade was appointed Director on the proposal of Nova Ardara Equities, S.A., formerly
Josechu, S.A.
* ICS Holding Limited was appointed Director by co-opting and ratified in the position by the Shareholders
General Meeting held on 25 February 2010, on the proposal of Sociedad Anónima de Desarrollo y Control, S.A.
(Sodesco) (controlled by Mr. Manuel Fernández de Sousa-Faro).
* Inverlema, S.L. was appointed Director on the proposal of Mr. Manuel Fernández de Sousa-Faro.
* Liquidambar Inversiones Financieras, S.L. was appointed Director on the proposal of Liquidambar Inversiones
Financieras, S.L.
* Iberfomento, S.A. was appointed Director on the proposal of Golden Limit, S.L., indirect holding of Mr. José
Antonio Pérez-Nievas Heredero
* Sociedad Gallega de Importación de Carbones, S.A. was appointed Director on the proposal of Sociedad Gallega
de Importación de Carbones, S.A., indirect holding of Mr. Manuel Fernández de Sousa-Faro.
* Ms. Ana Belén Barreras Ruano was appointed Director on the proposal of Transpesca, S.A., indirect holding of
Mr. José Alberto Barreras Barreras.
* Mr. José Carceller Arce was appointed Director on the proposal of Corporación Económica Damm, indirect
holding of Sociedad Anónima Damm.
The functioning and composition of the Audit and Remuneration Committees is
covered in Section 16.3) of this Registration Document.
b) Partners with unlimited liability, in the case of a limited partnership with
share capital.
Not applicable, since it is a Sociedad Anónima (joint stock company).
c) Founders, if the issuer has been established for fewer than five years.
Not applicable, since the Company was incorporated more than five years ago.
d) Any senior manager who is relevant to establishing that the issuer has the
appropriate expertise and experience for the management of the issuer’s
business.
The table of Senior Executives of PESCANOVA at the date of verification of this
Document, as well as the Executive Director on the Board of Directors previously
mentioned, is shown below:
NAME
POSITION
Casal Cabaleiro, Olegario
Area Chief Executive
De la Cerda López-Baspino, Juan José
Technical Director, Foodstuffs
Fernández Andrade, Pablo Javier
Area Chief Executive
Fernández Pellicer, Eduardo
Director of Organisation
Gallego García, Joaquín
Technical Director, Fleet
García García, Jesús Carlos
Adviser to the Chairman
López Uroz, Alfredo
Administration
Mata Moretón, César
Legal Department
Real Rodríguez, César
Area Chief Executive
San Segundo Fernández, Susana
Head of Human Resources
Táboas Moure, Antonio
Financial Director
Troncoso García-Cambón, David
Viña Tamargo, Joaquín
Area Chief Executive
Internal Auditing
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96
The nature of any family relationship between any of these persons.
According to the definition of “close relatives” laid down in legislation applicable to
related transactions (Order EHA/3050/2004, of 15 September), these relations are
strictly limited to (i) spouse or person with similar affective relationship, (ii)
ascendants, descendants and siblings, and the respective spouses or persons with
similar affective relationship, and (iii) ascendants, descendents and siblings of the
spouse or person with similar affective relationship, and the following relationships of
family nature exist between the persons identified in Section 14.1 of this section of
the Document:
Mr. Manuel Fernández de Sousa-Faro, Chairman of the Board of Directors is the
brother of Mr. Fernando Fernández de Sousa-Faro, representative of the Director ICS
Holdings Limited.
Mr. Manuel Fernández de Sousa-Faro, Chairman of the Board of Directors, is the
father of Mr. Pablo Javier Fernández Andrade, representative of the Director
Inverlema, S.L. and Area Chief Executive.
Mr. Fernando Fernández de Sousa-Faro is representative of the Director ICS Holdings
Limited, and is the uncle of Mr. Pablo Javier Fernández Andrade, representative of
the Director Inverlema, S.L. and Area Chief Executive.
In the case of each member of the administrative, management or supervisory
bodies of the issuer and of each person mentioned in points b) and d) of the first
paragraph, details of that person’s relevant management experience and
experience and the following information:
Information is briefly summarised below regarding the education and professional
career of members of administrative bodies, as well as management and supervisory
bodies (or their representatives):
MR. MANUEL FERNÁNDEZ DE SOUSA-FARO
EDUCATION:
Graduate in Physical Sciences from the Madrid Complutense University.
After completion of his university studies he undertook different Masters in senior
business management.
PROFESSIONAL HISTORY
In January 1977 he joined the workforce of PESCANOVA, moving through different
Departments of the Company. In June of the same year 1977, he joined the Board of
Directors of the Company as Director, participating in the economic strategy of the
Company.
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97
In 1978 he was appointed Chief Executive of PESCANOVA and subsequently, in
1985, was appointed by the Board of Directors as Chairman of PESCANOVA, which
position he currently holds, as well as the position of Chief Executive.
Within the scope of the corporate structure of PESCANOVA, he participated in the
creation of Joint Companies throughout the world, forming part of various company
Boards of Directors.
EXTRA-PROFESSIONAL ACTIVITIES:
He is a lover of letters and the arts and further enjoys various sports, such as sailing
and horse-riding.
MR. ALFONSO PAZ-ANDRADE RODRÍGUEZ
Graduate in Law.
In 1977 he joined the workforce of PESCANOVA as well as its Board of Directors.
Within PESCANOVA he carried out executive functions and was head of various
business areas, such as Ireland and Mozambique, until his retirement.
He has been Executive Chairman of several events of the World Fishing Exhibition,
forming part of the Boards of Directors of various undertakings and institutions
connected with the world of fishing.
He is Director of the economic review Industrias Pesqueras.
MR. ROBERT A. WILLIAMS
Bachelor of Arts (BA) and Law (LLB) from Cape Town University.
After completing his studies he joined Barlows Manufacturing Company, where he
was appointed Managing Director in 1979. In 1985 he was appointed Chairman of C
G Smith Foods and Tiger Brands, as well as member of the Board of Directors of
Barlow Rand.
After the division of CG Smith he continued to be Chairman of Tiger Brands until
2006.
At the present time he is Chairman of Illovo Sugar Limited and Director of Oceana
Group Limited.
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98
MR. FERNANDO FERNÁNDEZ DE SOUSA-FARO (representative of ICS
Holdings Limited)
Graduate in Law.
He collaborated in different areas of activity of the PESCANOVA Group, both
domestic and international.
He has been a Director of PESCANOVA since 11 June 1980.
Since its formation in 2003, he has been a member of the Audit Committee. Since
2009 he has occupied the position of Chairman of this body on behalf of ICS
Holdings Limited.
MR. ANTONIO BASAGOITI GARCÍA-TUÑÓN
Graduate in law.
Chairman of Banco Español de Crédito (Banesto).
Director, member of the Executive Committee, of the Delegate Risk Committee and
of the Technology, Productivity and Quality Committee of the Santander Group.
Honorary Chairman of Unión Fenosa. Deputy Chairman of FAES FARMA. Director
of PESCANOVA and Chairman of Appointments and Remuneration Committee, and
member of the Advisory Board of A.T. Kearney, of the Executive Board of Club
Español de la Industria, Tecnología y Minería and of Círculo de Empresarios.
MR. YAGO E. MÉNDEZ PASCUAL
Graduate in Economic Sciences from Universidad San Pablo CEU, MBA from IESE,
and Masters in Financial Markets from the CEU.
He has combined his professional career as executive in Banca Corporativa in Spain
and in Banca de Inversión in the USA with his presence as advisor on various Boards
of Directors of companies connected with foodstuffs, infrastructures, banking and
insurance.
At the present time he is independent business advisor of various investment
companies in Europe, Asia and South America with a presence in foodstuffs, real
estate, the financial sector and infrastructures.
MR. PABLO J. FERNÁNDEZ ANDRADE (representative of INVERLEMA, S.A. and
Area Chief Executive)
Graduate in Business Administration from the Northeastern University of Boston.
He has been a member of the Board of Directors of the PESCANOVA Group since
2000. Area Chief Executive since June 2007.
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99
In addition, he is Chairman of the PESCANOVA Group subsidiaries Frigodis (a
company devoted to Group logistics management) and Frinova (production of precooked products).
Prior to his appointment as Area Chief Executive, he worked in the Planning and
Development Department.
Since 2003 he has been a member of the Board of Mutua de Seguros de Armadores de
Buques de Pesca de España.
MR. JAVIER SORIANO AROSA
INVERSIONES FINANCIERAS, S.L.)
(representative
of
LIQUIDAMBAR
Graduate in Economic Sciences.
Thirty five years experience in financial services undertakings. Financial and
company analyst, responsible for team training and management. Executive with
senior responsibility in undertakings engaged in Analysis, Market Intermediation and
Derivatives of Banca de Negocios e Inversión.
His professional trajectory began in Safeí, and subsequently passing through Gesinca,
Gesmosa and Ahorro Corporación.
In 1992 he joined EBN Banco as Managing Director, which position he occupied until
his retirement on 30 August 2009.
MR. JOSÉ ANTONIO PÉREZ-NIEVAS HEREDERO (representative of
IBERFOMENTO, S.A.
Academic Qualifications:
− Doctorate in Industrial Engineering (ETSH, Barcelona).
− Masters in Specialist Engineering (University of Paris).
− Graduate in Advanced Management (Harvard Business School).
Professional Trajectory:
1974 –1977 President of Piher Corporation (USA).
1977 –1993 Founder and Executive Chairman of the CESELSA Group and its
subsidiaries in France and the United Kingdom.
1993 –1998 Deputy Chairman and Director of INDRA (outcome of the CESELSAINISEL merger).
1991 – 1993 Deputy Chairman of the COTEC Foundation.
1996 – 2001 Director of REPSOL YPF, S.A.
1995 – 2002 Director of the International Council of INSEAD (France).
2001 – 2004 Director of PETRONOR.
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100
Current positions:
− Chairman of IBERFOMENTO, S.A.
− Deputy Chairman of the Spain-USA Board.
− Patron of the COTEC Foundation.
− Patron of the REPSOL Foundation.
− Member of the Board of Directors of various companies.
MR. JESÚS C. GARCÍA GARCÍA (representative of GICSA and Advisor to the
Chairman)
Doctorate in Industrial Engineering.
He joined PESCANOVA at the beginning of 1964, having carried out executive
functions, as Chief Executive of the foodstuffs area.
He participated in expansion projects of the PESCANOVA Group, both national and
international.
He is presently Advisor to the Chairman and Director of the PESCANOVA Group
companies Frinova and Frigodis.
He is member of the Delegate Committee of the Federation of Foodstuffs and Drinks
Industries, FIAB.
MS. ANA BELÉN BARRERAS RUANO
Graduate in Business Management, and Business Management Programme at the
Caixanova Business School.
Masters in Financial Management and Control from the Instituto de Empresa.
2005-2006 Caixanova Business School, Vigo, Spain.
Business Management and Administration Programme.
1994–1998 ESERP Madrid, Spain.
MR. JOSÉ CARCELLER ARCE
Born on 22 March 1972. Graduate in Business Management and Administration in
1994 from the European Business School in London. MBA from IESE, Barcelona
(2003).
In the same year he joined Disa Corporación Petrolífera, S.A. as Director of Corporate
Development.
In 2005 he was appointed Director-Chief Executive, which position he holds at the
present time.
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As well as participating in Boards of the Disa Group, he is present on the Board of
Directors of S.A. Damm, Corporación Económica Damm and other subsidiaries of the
Group.
MR. FRANÇOIS TESCH
Born on 16 January 1951.
Graduate in Economics from the University of Aix-en-Provence, he also undertook
MBA studies in INSEAD (Institut Européen d’Administration des Affaires).
He has been a Director of Luxempart since 15 April 1999.
He is also Chief Executive (CEO) of Foyer S.A. and of Luxempart S.A.
He is also Director of Atenor Group S.A. and Deputy Chairman of the Board of SES.
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Information is briefly summarised below regarding education and professional career
of the Senior Executives:
MR. CÉSAR REAL RODRÍGUEZ, AREA CHIEF EXECUTIVE
Telecommunications Engineer from the Madrid Polytechnic University.
He completed his education in Business Management and Administration in Paris and
London.
He worked as Consultant for three years in France, Belgium and Spain. From 1981 he
was Managing Director of other fishing companies. He joined PESCANOVA in 1991
as Area Chief Executive. He is currently responsible for management of the
commercial subsidiaries in Europe and Japan.
Representing PESCANOVA, he is Managing Director of Mutuapesca, Director of
Conxemar, Director of Vigo Port and Chairman of the Fishing Companies Cluster in
third party countries.
MR. JUAN JOSÉ DE LA CERDA LÓPEZ-BASPINO, TECHNICAL
DIRECTOR, FOODSTUFFS
Graduate in Biology from the University of Murcia. Masters in Business
Administration (MBA) – Fishing and Aquaculture - from ICAI - ICADE. Advanced
Management Programme at the Business School of the Instituto de Empresa (IE). CS
Commercial Management and Marketing from the Caixanova Business School. CS
Organisation and Management of Technology Innovation from the University of Vigo
- MINER.
Since 1991 he has occupied different positions in the Parent and other PESCANOVA
Group Companies: Refrigerated Product Division Manager, Group Product Manager
(Marketing Division), Fishing Resources Area Project Expert - Aquaculture, Head of
Plant and Quality Control.
Since 2001 he has formed part of the Board of Directors of several commercial and
production companies of the PESCANOVA Group and is Technical Foodstuffs Head
of the Group.
MR.
EDUARDO
ORGANISATION
FERNÁNDEZ
PELLICER,
DIRECTOR
OF
Industrial Engineer in Business Organisation. Professor of Production Organisation at
the Tarrasa Advanced School of Industrial Engineering and Implementation Member
of Sistemas, S.A. (Sabadell) from 1975 to 1980. Professor of Operational Research at
the Vigo Advanced School of Industrial Engineering between 1982 and 1983.
He has been with PESCANOVA since May 1981 as Systems Analyst and from 1994
as Director of Organisation.
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MR. JOAQUÍN GALLEGO GARCÍA, TECHNICAL DIRECTOR, FLEET
Marine Engineer.
Between 1996 and1998 he worked as head of the technical office at Astilleros
Navales Santodomingo. Between 1998 and 2000, head of Swedish chemical vessel
project for United Tankers in Factorías Vulcano.
From 2000 up to the present time, with PESCANOVA as Technical Director, Fleet.
MR. ALFREDO LÓPEZ UROZ, ADMINISTRATION
Studies:
Industrial Engineering, Madrid Advanced School of Industrial Engineering.
Professional:
INECO (Transport Engineering and Economy), Economic and Technical Engineering,
RENFE.
Budget Control (Management Consultancy).
PESCANOVA (1982-2009) (Head of Analytical Accounting. Head of
Administration).
MR. CÉSAR MATA MORETÓN, LEGAL DEPARTMENT
Graduate in Law from the University of Santiago de Compostela.
In 1992 he joined the Legal Department of PESCANOVA. Between 1993 and 2011
he also practised as lawyer in a professional firm. In September 2001 he was
appointed Secretary of the Board of Directors of PESCANOVA.
MS. SUSANA SAN SEGUNDO FERNÁNDEZ
Born in Vigo on 29 March 1963.
Education:
1981-1986: Graduate in the History of Art (University of Santiago de Compostela),
specialising in Modern and Contemporary Art.
Supplementary education:
Human Resources Management and Employment Law (Madrid Polytechnic
University, Centre for Post-graduate Studies in Business Management).
Professional experience:
1988-1991: Argenova S.A. – PESCANOVA Group - (Buenos Aires, Argentina)
1992-present: PESCANOVA S.A.:
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Feb/92-June/11:
July/11-Sep/11:
Sep/11-present:
Human Resources Expert
Sub-director for Personnel and HR
Director of Personnel and HR
MR. ANTONIO TÁBOAS MOURE, HEAD OF FINANCE
Graduate in Economics from the University of Bilbao.
Masters in Business from the University of Vigo. He is member of the College of
Economists and of the Asociación Nacional de Tesoreros de España.
He began working as State Economist. He also worked in an internationally wellknown textile business. In 1972 he joined PESCANOVA and in 1980 was appointed
Head of Finance, which position he currently occupies.
MR. DAVID TRONCOSO GARCÍA-CAMBÓN, AREA CHIEF EXECUTIVE
Graduate in Economics and Business Sciences, Business Section, specialising in
Personnel Management, at the University of Santiago de Compostela, 1989.
Qualification as Insurance Broker and Agent, 1990.
Languages: English, written and spoken. Portuguese, written and spoken.
1989: PESCANOVA, S.A. – Commercial Department, branch administration and
budget preparation section.
1990: PESCANOVA, S.A. – Commercial Department, branch administration section.
Participated in implementing new administrative and IT management in the branches
at Toledo, Cádiz, Lérida, Murcia and Córdoba in PESCANOVA Spain, and in the
Oporto and Lisbon branches of PESCANOVA Portugal.
1990-92: PESCANOVA, S.A. – Head of Administration of the Murcia branch.
Murcia.
1992-94 PESCANOVA, S.A. – Head of Administration of the Madrid branch.
1994-2005 Pescamar, Lda. – General Manager. From 1997 to 2005 Honorary Consul
of Spain in Beira, Mozambique, for the provinces of Sofala, Manica and Tete.
Current Position: In PESCANOVA, S.A., as Chief Executive for Africa.
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MR. OLEGARIO CASAL CABALEIRO, AREA CHIEF EXECUTIVE
Graduate in Economics.
Joined PESCANOVA in 1963, in the Administration Department and was later
appointed Head of General Accounting until 1980, when he became responsible for
the Area of Mozambique, Equatorial Guinea and Ireland until July 2007, and since
August of the same year up to the present time as Director of the Vannamei Area.
MR. JOAQUÍN VIÑA TAMARGO, INTERNAL AUDITING
Graduate in Economics and Business Sciences.
He worked at Ernst & Young until 1985, since when he has worked in the
PESCANOVA Group as Head of Auditing.
Furthermore, add the following information:
a) The names of all companies and partnerships of which such person has been
a member of the administrative, management or supervisory bodies or
partner at any time in the previous five years, indicating whether or not the
individual is still a member of the administrative, management or
supervisory bodies or partner. It is not necessary to list all the subsidiaries of
an issuer of which the person is also a member of the administrative,
management or supervisory bodies.
All undertakings are detailed below of which the Directors of PESCANOVA, S.A.
have been members of the administrative, management or supervisory body, or
partner, in the last five years, except for (i) those companies of a purely holding or
family nature, (ii) share blocks in listed companies which do not constitute a
significant holding, and (iii) any others which are of no relevance for the purposes
of the Company’s activities.
Name of Director
.
Name of the entity
Position
Ms. Ana Belén Barreras Ruano
MONTEBALITO, S.A.
Director
BANCO ESPAÑOL DE CRÉDITO, S.A.
Mr. Antonio Basagoiti García-Tuñón (BANESTO)
Chairman
Mr. Antonio Basagoiti García-Tuñón SCH
Director
Mr. Antonio Basagoiti García-Tuñón FAES FARMA, S.A.
LIQUIDAMBAR INVERSIONES
FINANCIERAS, S.L. (EBN BANCO)DURO FELGUERA, S.A.
LIQUIDAMBAR INVERSIONES
FINANCIERAS, S.L. (EBN BANCO)LA SEDA DE BARCELONA, S.A.
Deputy Chairman
Director and Shareholder
IBERFOMENTO, S.A.
INDO INTERNACIONAL, S.A.
Director and Shareholder
IBERFOMENTO, S.A.
CARTERA INDUSTRIAL REA, S.A. Director and Shareholder
IBERFOMENTO, S.A.
NATRA, S.A.
Director and Shareholder
IBERFOMENTO, S.A.
TAVEX ALGODONERA, S.A.
Director and Shareholder
Share Registration Document
106
Director and Shareholder
PESCANOVA, S.A. is not aware that any of its Senior Executives are members of
administrative, management or supervisory bodies, or partners in entities other than
those referred to in their respective professional curricula, which are summarised
above, without prejudice to the fact that they may represent PESCANOVA, S.A.
on the Boards of Directors of different Group Companies.
b) Any convictions in relation to fraudulent offences for at least the previous five
years.
According to the information provided to the Company by each Director and
Senior Executive, it is recorded that none of the Directors or Senior Executives of
the Company referred to in this Section 14.1 has been convicted in relation to
fraudulent offences.
c) Details of any bankruptcies, receiverships or liquidations with which a person
described in a) and d) of the first paragraph who was acting in the capacity of
any of the positions set out in a) and d) of the first paragraph was associated
for at least the previous five years.
According to the information provided to the Company by each Director and
Senior Executive, it is recorded that none of the Directors or Senior Executives of
the Company referred to in this Section 14.1 has been a member of the
administrative, management or supervisory body or of the senior management of
entities which have been the subject of bankruptcy, receivership or other
insolvency processes.
d) Details of any official public incrimination and/or sanctions of such person by
statutory or regulatory authorities (including designated professional bodies)
and whether such person has ever been disqualified by a court from acting as
a member of the administrative, management or supervisory bodies of an
issuer or from acting in the management or conduct of the affairs of any
issuer for at least the previous five years.
According to the information provided to the Company by each Director and
Senior Executive, it is recorded that none of the Directors or Senior Executives of
the Company referred to in this Section 14.1 have been sentenced in criminal
proceedings or sanctioned by statutory or regulatory authorities (including
designated professional bodies) or disqualified on any occasion by a court as a
result of their action as member of the administrative, management or supervisory
bodies of the ISSUER or for their action in management of the affairs of the
ISSUER.
14.2 Administrative, management and supervisory bodies and senior management
conflicts of interest.
14.2.1 Conflict of interest.
PESCANOVA, S.A. has established specific rules relating to the regulation of
situations of conflict of interest which could affect any Director.
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107
In accordance with Section 23 of the Board Regulations, directors must notify the
Board of Directors of any situation of conflict, direct or indirect, which they may
have with the interests of the Company. In the event of a conflict the Director must
abstain from taking part in the operation to which the conflict relates.
Furthermore, the Internal Conduct Regulations, in section 4, also provide that those
affected by these Regulations must notify PESCANOVA, S.A. of possible
conflicts of interest with the Company to which they are subject as a result of their
family relationships, personal wealth or for any other reason. For these purposes,
and without prejudice to the obligation of loyal conduct deriving from corporate
and labour legislation, engaging in transactions of any type in securities, whether
listed or not, in entities which engage in the same type of business as
PESCANOVA, S.A. will be considered a conflict of interest.
Furthermore, section 25 of the Board Regulations of PESCANOVA, S.A.
establishes, in compliance with the duty of loyalty to which each Director is
subject, that they may not use the name of the Company or invoke their status as
Directors thereof in order to engage in operations for own account or for account of
persons connected with them, and that no Director may for own benefit or that of
persons connected with him make investments or engage in any transactions
connected with the property of the Company, which the same has become aware of
by reason of occupying the position, when the investment or transaction has been
offered to the Company or it has an interest in it, provided that it has not rejected
the said investment or transaction without influence from the Director.
No Director has notified PESCANOVA, S.A. of holdings in the capital of entities
which have the same, similar or complementary activities to those constituting the
corporate objects of either PESCANOVA, S.A. or its Group or that they occupy
positions or carry out functions in such entities, in compliance with Section 229.2
of the Capital Companies Act.
The Company has engaged in transactions with related parties which are described
in Section 19 of the Document.
In general, PESCANOVA, S.A. always tries to maintain all precautions laid down
by the principles of good corporate governance in cases of conflicts of interest, real
or potential, and ensure compliance with Sections 225 and following of the Capital
Companies Act.
According to the information available to the Company, no members of the Board
of Directors nor the Senior Executives referred to in the previous Section 14.1,
have a conflict of interest (in accordance with the definition under Sections 225
and following of the Capital Companies Act) between their duties to the Company
and their private interests of any other type, nor engage in activities for own or
third party account of similar or complementary nature to the activities which
constitute the corporate objects of PESCANOVA, S.A.
14.2.2. Any arrangement or understanding with major shareholders, customers, suppliers or
others, pursuant to which any person referred to in item 14.1 was selected as a
member of the administrative, management or supervisory bodies or member of
senior management.
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108
PESCANOVA has not become aware of any arrangement or understanding with
major shareholders, customers, suppliers or others pursuant to which any person
referred to in the foregoing section 14.1 has been designated member of
administrative, management or supervisory bodies, or as Senior Executive, except
for the Designated Directors as well as the individual representative of the Director
of GICSA, Mr. Jesús García García, who previously carried out executive
functions in the Company.
14.2.3. Details of any restrictions agreed by the persons referred to in section 14.1 on the
disposal within a certain period of time of their holdings in the issuer’s securities.
PESCANOVA is not aware of the existence of restrictions agreed by the persons
referred to in the foregoing Section 14.1 on the disposal within a certain period of
time of their holding in the securities of PESCANOVA.
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109
15. REMUNERATION AND BENEFITS
In relation to the last full financial year for those persons referred to in points a)
and d) of the first sub-paragraph of section 14.1.
15.1 The amount of remuneration paid (including any contingent or deferred
compensation), and benefits in kind granted to such persons by the issuer and its
subsidiaries for services in all capacities to the issuer and its subsidiaries by any
person.
In accordance with the provisions of Article 41 of the Articles of Association, the
position of Director will be remunerated, with the remuneration consisting of a fixed
annual amount, an attendance allowance, and reimbursement of travelling expenses.
The foregoing receipts must be compatible with and independent of remuneration or
financial benefits of an employment nature which any Director may receive for
services or functions other than occupying the position of Director.
Aggregate remuneration of members of the Board of Directors accrued during the
financial years relating to the historical information was as follows: (data in thousands
of euros)
ITEM OF REMUNERATION
2011
2010
2009
Variable remuneration
300
0
0
Fixed remuneration (salaries)
618
618
557
Allowances
513
562
453
Articles of Association provisions
Stock options and/or other
financial instruments
460
472
429
0
0
0
0
0
1,652
0
1,439
Others
Total
1,891
The Directors of PESCANOVA have not received any remuneration for belonging to
other Boards of Directors of PESCANOVA Group Companies.
Total remuneration by type of Director: (data in thousands of euros)
BY COMPANY
2011
TYPE OF DIRECTOR
BY COMPANY
2010
BY COMPANY
2009
Executive
989
693
620
Designated External
653
780
664
Independent External
249
179
155
0
0
1,439
Other External
Total
Share Registration Document
0
1,891
110
1,652
Total remuneration paid under the sole items of wages and salaries to members of
Senior Management of PESCANOVA at 31 December 2011, 2010 and 2009,
amounted to:
Total Senior Management Remuneration
(Thousands of euros)
2011
2010
2,161
1,982
2009
1,886
15.2 The total amounts set aside or accrued by the issuer or its subsidiaries to provide
pension, retirement or similar benefits.
There are no amounts set aside or accumulated by PESCANOVA or its subsidiaries
for pension, retirement or similar benefits.
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111
16. BOARD PRACTICES
16.1 Data of expiration of the current term of office, if applicable, and the period
during which the person has served in that office.
At the date of this Document the Board of Directors of PESCANOVA has the
following composition:
Date of 1st
appointment
Date of appointment
in force
Expiration date
Mr. Manuel Fernández de Sousa-Faro
25.06.77
23.04.08
23.04.13
Mr. Alfonso Paz-Andrade Rodríguez
25.06.77
23.04.08
23.04.13
Mr.Robert Albert Williams
29.06.93
06.04.10
06.04.15
Mr. Antonio Basagoiti García-Tuñón
20.06.96
08.04.11
28.04.16
Mr. Yago E. Méndez Pascual
28.04.06
08.04.11
08.04.16
Ms. Ana Belén Barreras Ruano
25.04.07
13.04.12
13.04.17
Mr. José Carceller Arce
09.09.11
30.01.12
30.01.17
INVERLEMA, S.L.
SOCIEDAD GALLEGA DE IMPORTACIÓN
DE CARBONES, S.A. (GICSA)
13.04.12
13.04.12
13.04.17
28.04.06
08.04.11
08.04.16
ICS HOLDINGS LIMITED
LIQUIDAMBAR INVERSIONES
FINANCIERAS, S.L.
04.09.09
25.02.10
25.02.15
28.02.06
08.04.11
08.04.16
IBERFOMENTO, S.A.
28.04.06
08.04.11
08.04.16
LUXEMPART, S.A.
09.09.11
30.01.12
30.01.17
DIRECTORS
The Articles of Association of the Company fix the term of office of Directors at five
years, without prejudice to re-election which may take place indefinitely.
The position of Secretary (non-director) of the Board of Directors has been held since
21 September 2001 by Mr. César Mata Moretón.
16.2 Information about members of the administrative, management or supervisory
bodies’ service contracts with the issuer or any of its subsidiaries providing for
benefits upon termination of employment, or an appropriate negative statement.
At the date of this Document, the PESCANOVA Group does not have contracts with
these characteristics.
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112
16.3 Information about the issuer’s audit committee and remuneration committee,
including the names of committee members and a summary of the terms of
reference under which the committee operates.
Audit Committee
The Shareholders General Meeting of PESCANOVA, S.A. on 25 April 2003
approved a modification of the Articles of Association in order to incorporate an
Additional Provision One regulating the Audit Committee, thereby complying with
Additional Provision Eighteen of the Securities Market Act, 24/1988, of 28 July, a
provision introduced by Section 47 of Act 44/2002 on Reform of the Financial
System, without there consequently being a special regulation for these purposes.
The fundamental competences of the Committee are basically those relating to
internal information and control systems, supervising internal audit services,
acquaintance with financial information processes and internal control systems of the
Company, proposing the appointment of external auditors to the Board of Directors
for submission to the Shareholders General Meeting, and any competence which may
legally apply to it.
The Board of Directors must from among its members designate the Audit
Committee, comprising three members. The majority of the Directors appointed to
make up this Committee must be Non-Executive Directors. The Chairman, who must
be elected from Non-Executive Board members, must convene meetings of this
Committee when he considers it appropriate and/or is so requested by two of its
members, and these meetings must be held at the registered office of the Company.
The Secretary, with the approval of the Chairman, is responsible for certifying
resolutions of the Committee and issuing minutes of meetings held. The Committee
will be validly constituted when the meeting is attended by at least two of its
members. Attendance may be in person or by special delegation in each case to
another member of the committee.
At the date of this Document the members of this Committee are as follows:
Position
Name
ICS Holdings Limited
Chairman
Mr. Robert Albert Williams
Secretary-Member
Mr. Alfonso Paz-Andrade
Member
Type
Designated
Independent
Designated
The members of the Audit Committee will be entitled to the fixed remuneration and
allowances due to them as a result of their status as members of the Board of
Directors, as well as an allowance for attending meetings of this Committee and
reimbursement of travelling expenses, all in accordance with the provisions of section
5 of Additional Provision One of the Articles of Association of PESCANOVA, S.A.
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113
In accordance with the provisions of section 3 of Additional Provision One of the
Articles of Association of PESCANOVA, S.A., the powers and functions of the Audit
Committee are as follows:
a) Reporting to the Shareholders General Meeting on matters raised with it by
shareholders in matters within its competence.
b) Proposal of the appointment of external auditors to the Board of Directors for
submission to the Shareholders General Meeting, as referred to by Section 264 of
the Capital Companies Act enacted by Royal Legislative Decree 1564/1989, of 22
December.
c) Supervision of internal audit services if the same exist within the business
organisation.
d) Acquaintance with financial information processes and internal control systems of
the Company.
e) Relations with external auditors to receive information regarding those matters
which may place their independence at risk and any others relating to the process
of auditing accounts, as well as those other communications provided for in
legislation on auditing and in technical auditing standards.
f) Any others which may legally apply to it.
During the 2011 and 2010 financial years the Audit Committee has met in each of the
years on two occasions.
Appointments and Remuneration Committee
During the 2011 financial year the Appointments and Remuneration Committee met
on three occasions (two occasions in 2010).
The Appointments and Remuneration Committee is regulated in the Board
Regulations of PESCANOVA, S.A. (Article 11.bis), approved on 1 April 2004.
It is made up of three members of the Board who are not Executive Directors, and the
Board of Directors is responsible for appointing the Chairman and Secretary of the
Committee.
Without prejudice to those other tasks which may be allocated to it by the Board, this
Committee has the function of proposing to the Board of Directors the system of
remuneration of Executive Directors in the amounts they receive for management
functions in the Company other than those which they receive as a result of their
position as Directors, periodically reviewing remuneration systems, weighing up their
adequacy and ensuring transparency of remuneration. It must further propose to the
Board of Directors the system of remuneration of Directors for the amounts which
they receive in such capacity, in accordance with the Law and the Articles of
Association.
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114
The Committee must meet whenever the Board or its Chairman so request and at least
once a year.
The Committee will be validly constituted when the meeting is attended in person or
by proxy by at least two of its members. Resolutions must be passed by simple
majority of Directors present at the meeting. In the event of a tie, the Chairman or
person carrying out the functions thereof will have a casting vote.
As well as the fixed remuneration and allowances due to them as a result of their
position as members of the Board of Directors, members of the Committee will be
entitled to an allowance for attending meetings of the Committee and reimbursement
of travelling expenses.
At the date of this Document the members of this Committee are as follows:
Name
Position
Mr. Antonio Basagoiti García-Tuñón
Chairman
ICS Holdings Limited
Secretary-Member
Mr. Robert Albert Williams
Member
Type
Independent
Designated
Independent
16.4 A statement as to whether or not the issuer complies with its country’s of
incorporation corporate governance regime(s). In the event that the issuer does
not comply with such a regime, a statement to that effect must be included
together with an explanation regarding why the issuer does not comply with
such regime.
PESCANOVA, S.A. is materially in compliance with the recommendations laid down
in the Unified Code of Good Governance approved by the Spanish Securities Market
Commission (Comisión Nacional del Mercado de Valores) on 22 May 2006, with an
explanation in the Annual Report on Corporate Governance for the financial year
ending 31 December 2011 of those recommendations which are not the subject of
compliance in full. This Report is available on the Internet (www.pescanova.com), at
the Spanish Securities Market Commission (www.cnmv.es), and is incorporated by
reference into this Registration Document.
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115
17. EMPLOYEES
17.1 Either the number of employees at the end of the period or the average for each
financial year for the period covered by the historical financial information up
to the date of the registration document (and changes in such numbers, if
material) and, if possible and material, a breakdown of persons employed by
main category of activity and geographic location. If the issuer employs a
significant number of temporary employees, include disclosure of the number of
temporary employees on average during the most recent financial year.
Information relating to employees of the PESCANOVA Group and movements
therein during the last three financial years is broken down below.
AVERAGE PERSONNEL
IN PERIOD
SPAIN
REST OF EUROPE
AMERICAS
AFRICA
OTHERS
TOTAL
2011
1,262
398
7,944
658
16
10,278
2010
1,297
311
7,035
672
16
9,331
2009
1,377
254
7,194
792
15
9,632
The increase in the Group workforce in 2011 basically took place in the Americas
and was due fundamentally to the incorporation/entry into production of Aquaculture
plants in Central America.
The percentage which temporary employees represent with respect to the workforce
as a whole is not significant.
At the date of Registration of this Document no significant modifications have taken
place in relation to December 2011.
17.2 Shareholdings and stock options.
There are no plans for acquisition of shares or stock options by employees.
The information on shareholdings of Directors of the Company is included in section
18.1.
17.3 Description of any arrangements for involving the employees in the capital of the
issuer.
There are no agreements for participation by employees in the capital of the ISSUER.
Share Registration Document
116
18. MAJOR SHAREHOLDERS
18.1 Insofar as is known to the issuer, the name of any person other than a member
of the administrative, management or supervisory bodies who, directly or
indirectly, has an interest in the issuer’s capital or voting rights which is
notifiable under the issuer’s national law, together with the amount of each such
person’s interest or, if there are no such persons, an appropriate negative
statement.
According to the most recent available public information, the principal shareholders
of PESCANOVA and their percentage holding in its capital are as follows:
I.
NON-BOARD MEMBER SHAREHOLDERS WITH SIGNIFICANT HOLDINGS
Name
No. of
No. of
Total no. of
direct voting indirect voting voting
rights
rights
rights
GOVERNANCE FOR OWNERS LLP
% of total
voting
rights
0
986,827
986,827
5,074
MR. JOSE ANTONIO PÉREZ-NIEVAS HEREDERO(2)
0
974,307
974,307
5,010
SOCIEDAD ANÓNIMA DAMM
0
972,366
972,366
5,000
0
748,100
748,100
3,847
0
3,681,600
3,681,600
18,931
(1)
(3)
(4)
MR. JOSÉ ALBERTO BARRERAS BARRERAS
TOTAL
Through:
(1) Governance for Owners European Focus Found
(2) Golden Limit, S.L.
(3) Corporación Económica Damm
(4) Transpesca
Note: The holdings of NOVA ARDARA EQUITIES, S.A. and of SODESCO are not incorporated since they are shown as indirect
holdings of the Board, whose owners are Mr. Alfonso Paz-Andrade and Mr. Manuel Fernández de Sousa-Faro.
Share Registration Document
117
II.
BOARD MEMBER SHAREHOLDERS WITH VOTING RIGHTS IN THE COMPANY
No. of direct
voting
rights
Name or company name of the
Director
FERNÁNDEZ DE SOUSA--FARO, MANUEL
No. of
indirect voting
rights
Total no. of
voting rights
% of total
Voting rights
18,073
4,283,603 (1)
4,301,676
22.120
PAZ-ANDRADE RODRÍGUEZ, ALFONSO
2,631
992,120 (2)
994,751
5.116
BASAGOITI GARCÍA-TUÑÓN, ANTONIO
1,100
0
1,100
0.006
1
0
1
0.000
221
0
221
0.001
975,000
0
975,000
5.014
39,420
0
39,420
0.203
1,000,000
0
1,000,000
5.142
1,000
0
1,000
0.005
2,037,446
5,275,723
7,313,169
37.607
INVERLEMA, S.L.
ROBERT ALBERT WILLIAMS
LIQUIDAMBAR INVERSIONES FINANCIERAS, S.L
SOCIEDAD GALLEGA DE IMPORTACIÓN DE
CARBONES, S.A. (GICSA)
LUXEMPART, S.A.
JOSÉ CARCELLER ARCE
TOTAL
(
Through:
(1) SODESCO (14.823%) and INVERPESCA, S.A. (7.204%). GICSA is not included since it is Director and submits separate statements.
(2) Nova Ardana Equities, S.A. (previously Josechu, S.A.) (5.097%). Sipsa (0.004) and Ibercisa (0.001).
No Director holds PESCANOVA stock options.
III.
SHARES HELD BY MINOR SHAREHOLDERS
Total number of
shares
8,452,485
% of total
share capital
43.462
In accordance with the foregoing, at the date of this Document non-Board
shareholders of PESCANOVA with major holdings overall, directly or indirectly,
hold 3,681,600 shares, representing 18.931% of capital. Board members hold
7,313,169 shares, amounting to 37.607% of capital. Shares held by minor
shareholders total 8,452,485, amounting to 43.462%.
IV.
The Directors not included in Table II (Ms. Ana Belén Barreras Ruano, Mr.
Yago Enrique Méndez Pascual, ICS HOLDINGS LTD and IBERFOMENTO,
S.A.) do not hold shares in the Company.
The Company is not aware that any high level executive who regularly has
access to privileged information relating directly or indirectly to the ISSUER
and who furthermore is competent to take management decisions which affect
the future development and business prospects of the ISSUER, holds shares or
options in the Company.
Share Registration Document
118
18.2 Whether the issuer’s major shareholders have different voting rights, or an
appropriate negative statement.
The voting rights of major holders are proportional to their respective percentage
capital holdings indicated in the previous section 18.1 of this section of the
Document, with all shares having the same rights.
18.3 To the extent known to the issuer, state whether the issuer is directly or
indirectly owned and controlled and by whom and describe the nature of such
control and describe the measures in place to ensure that such control is not
abused.
PESCANOVA is the parent company of the PESCANOVA Group and is an
independent entity which constitutes the final level of control and does not form part
of any other group of companies, as defined in Section 42 of the Commercial Code,
nor is it controlled by any natural or legal person.
PESCANOVA is not aware of the existence at the present time of quasi-corporate
agreements or concerted actions between shareholders.
18.4 A description of any arrangement, known to the issuer, the operation of which
may at a subsequent date result in a change of control of the issuer.
PESCANOVA is not aware of any arrangements the application of which may at a
subsequent date give rise to a change of control of the ISSUER.
Share Registration Document
119
19. RELATED PARTY TRANSACTIONS
Details of related party transactions (which for these purposes are those set out
in the Standards adopted according to Regulation (EC) no. 1606/2002), that the
issuer has entered into during the period covered by the historical financial
information and up to the date of the registration document, must be disclosed in
accordance with the respective standard adopted according to Regulation (EC)
no. 1606/2002, if applicable.
If such standards do not apply to the issuer, the following information must be
disclosed:
a) The nature and extent of any transactions which are –as a single transaction
or in their entirety– material to the issuer. Where such related party
transactions are not concluded at arm’s length, provide an explanation of why
these transactions were not concluded at arm’s length. In the case of
outstanding loans, including guarantees of any kind, indicate the amount
outstanding.
b) The amount or the percentage to which related party transactions form part
of the turnover of the issuer.
Transactions between the Company and its subsidiary Companies which are related
parties form part of the normal traffic of the Company with respect to their subject
matter and conditions, and are eliminated in the consolidation process, and are not
therefore broken down in this note.
Transactions existing during the period covered by the selected financial
information with members of the Board of Directors, all closed on market terms,
were the following:
Share Registration Document
120
RELEVANT TRANSACTIONS WITH SIGNIFICANT SHAREHOLDERS DURING
THE 2009 FINANCIAL YEAR
Name or trading name of the directors or executives
Name or trading name of the
company or entity in its group
Nature of the transaction
Type of transaction
Nominal
Amount
(000 euros)
PESCANOVA AND VARIOUS
Contractual-Through its
shareholder Caixa Galicia
Loan financing agreements and
capital contributions (borrower)
165,750
INSUÍÑA, S.L.
Contractual-Through its
shareholder Caixa Galicia
Loan financing agreements and
capital contributions (borrower)
900
BAJAMAR SEPTIMA, S.A.
Contractual-Through its
shareholder Caixa Galicia
Loan financing agreements and
capital contributions (borrower)
750
PESCAFRESCA
Contractual-Through its
shareholder Caixa Galicia
Loan financing agreements and
capital contributions (borrower)
450
PESCANOVA INC.
Contractual-Through its
shareholder Caixa Galicia
Loan financing agreements and
capital contributions (borrower)
7,100
PESCANOVA PORTUGAL
Contractual-Through its
shareholder Caixa Galicia
Loan financing agreements and
capital contributions (borrower)
2,500
NOVA AUSTRA, S.A.
Contractual-Through its
shareholder Caixa Galicia
Loan financing agreements and
capital contributions (borrower)
25,000
PESCANOVA, S.A.
Contractual-Through its
shareholder Caixa Galicia
Loan financing agreements and
capital contributions (borrower)
51,000
HASENOSA
Contractual-Through its
shareholder Caixa Galicia
Loan financing agreements and
capital contributions (borrower)
8,230
PESCANOVA, S.A.
Contractual-Through EBN
Banco
Loan financing agreements and
capital contributions (borrower)
18,500
LLIQUIDAMBAR INVERSIONES FINANCIERAS, S.L.
INSUÍÑA, S.L.
Contractual-Through EBN
Banco
Loan financing agreements and
capital contributions (borrower)
2,000
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
PESCANOVA, S.A.
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
35,000
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
12,900
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
5,000
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
3,900
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
1,400
4,200
CXG CORPORACIÓN CAIXAGALICIA, S.A.
CXG CORPORACIÓN CAIXAGALICIA, S.A.
CXG CORPORACIÓN CAIXAGALICIA, S.A.
CXG CORPORACIÓN CAIXAGALICIA, S.A.
CXG CORPORACIÓN CAIXAGALICIA, S.A.
CXG CORPORACIÓN CAIXAGALICIA, S.A.
CXG CORPORACIÓN CAIXAGALICIA, S.A.
CXG CORPORACIÓN CAIXAGALICIA, S.A.
CXG CORPORACIÓN CAIXAGALICIA, S.A.
LLIQUIDAMBAR INVERSIONES FINANCIERAS, S.L.
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
PESCANOVA AND VARIOUS
PESCA CHILE, S.A.
FRIVIPESCA CHAPELA
FRIGODIS, S.A.
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
PESCAFRESCA
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
PESCAFINA BACALAO, S.A.
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
2,000
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
FRINOVA
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
3,950
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
INSUÍÑA, S.L.
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
2,000
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
2,600
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
2,500
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
CAIXA DE AFORROS DE VIGO, OURENSE E PONTEVEDRA
(CAIXANOVA)
Share Registration Document
PESCAFINA, S.A.
HASENOSA
121
RELEVANT TRANSACTIONS WITH SIGNIFICANT SHAREHOLDERS 2010
Name or company name of the directors or executives
Name or company name of the
company or entity in its group
Nature of the transaction
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
BAJAMAR SEPTIMA, S.A.
FRIGODIS, S.A.
Type of transaction
Nominal
Amount
(000 euros)
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
750
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
1,400
3,950
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
FRINOVA, S.A.
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
FRIVIPESCA CHAPELA
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
3,900
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
HASENOSA, S.A.
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
7,680
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
INSUIÑA, S.A.
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
2,000
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
25,000
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
5,000
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
2,000
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
2,600
2,000
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
NOVA AUSTRAL, S.A.
PESCA CHILE, S.A.
PESCAFINA BACALAO, S.A.
PESCAFINA, S.A.
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
PESCAFRESCA AND VARIOUS
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
PESCAFRESCA
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
2,350
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
PESCANOVA PORTUGAL
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
2,500
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
PESCANOVA AND VARIOUS
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
108,900
CONTRACTUAL
Loan financing agreements and
capital contributions (borrower)
92,000
INSUIÑA, S.A.
Contractual-Through EBN
Banco
Loan financing agreements and
capital contributions (borrower)
2,000
PESCANOVA, S.A.
Contractual-Through EBN
Banco
Loan financing agreements and
capital contributions (borrower)
16,000
CAIXA DE AFORROS DE GALICIA, VIGO, OURENSE
E PONTEVEDRA (NOVACAIXAGALICIA)
LLIQUIDAMBAR INVERSIONES FINANCIERAS, S.L.
LLIQUIDAMBAR INVERSIONES FINANCIERAS, S.L.
PESCANOVA, S.A.
RELEVANT TRANSACTIONS WITH SIGNIFICANT SHAREHOLDERS 2011
Name or company name of the directors or executives
Name or company name of the
company or entity in its group
Nature of transaction
LLIQUIDAMBAR INVERSIONES FINANCIERAS, S.L.
LLIQUIDAMBAR INVERSIONES FINANCIERAS, S.L.
Share Registration Document
Type of transaction
Nominal
Amount (000
euros)
PESCANOVA, S.A.
Contractual-Through EBN
Banco
Loan financing agreements and
capital contributions (borrower)
18,170
INSUÍÑA, S.L.
Contractual-Through EBN
Banco
Loan financing agreements and
capital contributions (borrower)
2,000
122
RELEVANT TRANSACTIONS WITH SIGNIFICANT SHAREHOLDERS DURING
THE FIRST QUARTER OF 2012
Name or company name of the
directors or executives
LLIQUIDAMBAR INVERSIONES FINANCIERAS, S.L.
LLIQUIDAMBAR INVERSIONES FINANCIERAS, S.L.
Name or company name
of the company or entity
in its group
Nature of the transaction
PESCANOVA, S.A.
Contractual-Through EBN
Banco
INSUÍÑA, S.L.
Contractual-Through EBN
Banco
Type of transaction
Nominal
Amount (000 euros)
Loan financing agreements and
capital contributions (borrower)
10,670
Loan financing agreements and
capital contributions (borrower)
2,000
The outstanding balance of loans and security at 31 March 2012 with LIQUIDAMBAR
INVERSIONES FINANCIERAS, S.L. was 11.5 million euros.
There are no transactions with other significant shareholders or Senior Executives of the
Company.
Share Registration Document
123
20. FINANCIAL INFORMATION CONCERNING THE ISSUER’S ASSETS AND
LIABILITIES, FINANCIAL POSITION AND PROFITS AND LOSSES
20.1 Historical financial information.
The audited Financial Statements for the 2011, 2010 and 2009 financial years were
approved by the Shareholders General Meetings held on 13 April 2012, 8 April 2011
and 6 April 2010, respectively.
Comparison of information in annual financial statements.
The financial information relating to the Annual Financial Statements is uniform in
the sense that no significant changes took place in the application of IFRS during the
historical period covered by this Document.
Modifications to the consolidation perimeter.
In section 7 of this Document, “Organisational Structure”, the principal Subsidiary,
“Multi-group and Associate” Companies which make up the PESCANOVA Group
are listed.
Changes in the consolidation perimeter in the 2009 to 2011 period.
During 2011 and 2010 there were no changes as a result of purchases or
takeovers.
In the financial year ending 31 December 2009 the only change in the
consolidation perimeter was that relating to acquisition of 100% of Corporación
Novamar S.A.C., a Peruvian company.
Share Registration Document
124
The selected information is described below:
A.
BALANCE SHEET
Thousands of euros
ASSETS
2011
2010
2009
NON-CURRENT ASSETS
1,120,143
1,123,169
1,129,682
Tangible Fixed Assets
% Variation
10-11
% Variation 09-10
-0.3%
-0.6%
1,004,782
999,896
1,001,627
0.5%
-0.2%
Intangible Assets
37,931
38,876
31,580
-2.4%
23.1%
Goodwill
70,880
70,770
75,176
0.2%
-5.9%
2,242
149
1,654
1404.7%
-91.0%
Investments recorded by the Equity Method
358
6,295
11,833
-94.3%
-46.8%
3,950
7,183
7,812
-45.0%
-8.1%
Long Term Financial Investments
Deferred Taxes
1,156,338
1,066,973
948,592
8.4%
12.5%
Stocks
676,805
578,608
499,213
17.0%
15.9%
Trade Debtors and Other Accounts Receivable
259,259
262,187
244,427
-1.1%
7.3%
1,748
8,264
11,296
-78.8%
-26.8%
CURRENT ASSETS
Short Term Financial Investments
142,636
131,447
99,901
8.5%
31.6%
Other Assets
20,730
22,024
24,924
-5.9%
-11.6%
Non-current Assets classified as held for sale
55,160
64,443
68,831
-14.4%
-6.4%
2,276,481
2,190,142
2,078,274
3.9%
5.4%
Cash and Equivalents
TOTAL ASSETS
Thousands of euros
NET EQUITY AND LIABILITIES
2011
NET EQUITY
Of the Parent Company
Of Minority Shareholders
LONG TERM LIABILITIES
Deferred Income
Long Term Provisions
Bonds? and other Negotiable Securities
2010
% Variation
10-11
2009
% Variation09-10
531,890
477,166
444,459
11.5%
7.4%
505,610
448,484
415,998
12.7%
7.8%
26,280
28,682
28,461
-8.4%
0.8%
924,275
810,950
642,647
14.0%
26.2%
111,522
119,677
125,831
-6.8%
-4.9%
2,622
3,450
8,722
-24.0%
-60.4%
244,704
104,254
--
134.7%
100.0%
Long Term Financial Debt without Recourse
125,320
120,046
102,513
4.4%
17.1%
Long Term Financial Debt with Recourse
390,059
395,543
338,977
-1.4%
16.7%
50,048
67,980
66,604
-26.4%
2.1%
820,316
902,026
991,168
-9.1%
-9.0%
Other Long Term Accounts Payable
SHORT TERM LIABILITIES
Short Term Financial Debt Without Recourse
4,803
2,170
2,293
121.3%
-5.4%
Short Term Financial Debt With Recourse
196,041
172,418
306,068
13.7%
-43.7%
Trade Creditors and Other Short Term Accounts Payable
619,472
727,438
682,807
-14.8%
6.5%
2,276,481
2,190,142
2,078,274
3.9%
5.4%
TOTAL NET EQUITY AND LIABILITIES
Comments on significant variations in the historical period considered, 2009 to 2011:
Share Registration Document
125
1.
Variations in 2011
NON-CURRENT ASSETS
Con-current assets decreased in 2011 by 3 million euros, -0.3% compared with the
opening balance. Of total non-current assets, 89.7% relate to tangible fixed assets
which grew by 0.5% during the year to 1,004 million euros and variations and
composition of which are reported in greater detail in sections 5.2.1 and 8.1,
“Investments and disinvestments in fixed assets (property, plants and equipment)”.
Goodwill grew in 2011 by 0.1 million and accounts for 6.3% of total non-current
assets. Other intangible assets account for 3.3% of total non-current assets and are
reported in section 5.2.1, “Investments and disinvestments in intangible assets”.
The Group has not acquired any holdings during the course of this financial year.
The movement in consolidation goodwill is as follows:
Thousands of euros
75,176
Opening balance 01/01/10
Adjustments to opening balance
Additions
Reductions for impairment of assets
Closing balance 31/12/10
Adjustments to opening balance
Additions
Reductions for impairment of assets
Closing balance 31/12/11
--(4,406)
70,770
45
65
--70,880
During 2011 there were no significant additions to consolidated goodwill since there
were no Company purchases.
The discount rate applied to cash flow projections was determined taking into account
the weighted average cost of capital of the Group corrected to reflect the specific risks
associated with the different cash generating units analysed.
CURRENT ASSETS
During 2011 current assets increased by 89 million euros, 8.4%. The main component
of current assets relates to stocks which amounted to 676 million, with an increase of
98 million with respect to the previous year. This increase is mainly determined by
biological assets, biomass, which rose by 77.1 million euros as a result of maintaining
industrial development of salmon and turbot farming activities as well as prawns.
Assets classified as held for sale are five of its vessels, all active, of the Group’s
fishing fleet which it is estimated will be sold and may be replaced by other more
specialised ones. They are valued at book cost (28 million euros), and therefore their
new classification did not result in any profit and loss and it is estimated that their net
sale price will be equal to or higher than this. In addition, production or aquaculture
land and installations and other assets principally located in Europe, Australia, Central
Share Registration Document
126
America and South America are in the same situation, recorded at their book value
(27.1 million euros) and the final sale price of which is estimated will not be less.
The breakdown of stocks by uniform groups of activities and degree of termination,
and provisions made, are as follows:
Provisions
Thousands of euros
2011
2010
164,454
162,722
135,627
125,238
268,938
219,160
62,161
39,083
46,824
33,309
678,004
579,512
(1,199)
(904)
Total
676,805
Commercial stocks
Raw materials and other supplies
Products semi-completed and in progress
Completed products
Sub-products, waste, materials recovered and advances
578,608
There are no firm purchase and sale commitments nor future contracts relating to
stocks. There are no significant restrictions on the disposability of stocks as a result of
security, pledges, or other similar reasons, nor substantive circumstances which affect
the ownership, disposability or valuation of stocks, such as litigation, insurance or
attachments.
Biological assets relate to cultivated fish at different stages of growth, and are
recorded in the balance sheet under Products in Progress and Semi-completed.
No profit or loss was generated as a result of initial recognition of biological assets, or
as a result of changes in reasonable value less estimated costs at point of sale.
Movements during 2011 in these assets are shown below:
Biological Assets
Amount at 31 December 2010
Variation in stocks
Amount at 31 December 2010
Thousands of euros
182.596
77.112
259.708
Of the remaining components of current assets these related to trade debts and other
debts receivable are relevant, amounting to 259 million and 22%, having decreased by
-1.1% with respect to the previous year.
Share Registration Document
127
NET EQUITY
This amounted to 531 million and variations with respect to the previous year were
principally due to obtaining profits and distribution of dividends. Explanations
relating to capital and other own funds are included in section 10.
Breakdown and movements in net equity of the Group at 31 December 2011 and 2010
are as follows (thousands of euros):
Share Registration Document
128
Reserves for
own
Securities
Profit
Retained
Total
Net Equity
of the
Parent
Company
Net Equity
of
Minority
Shareholders
175,071
415,998
28,461
444,459
Total
Net Equity
Share
Capital
Issue
Premium
Balance at 01/01/10
116,683
57,043
15,600
(3,778)
(2,901)
(2,582)
60,862
--
Distribution of P & L
--
--
1,431
--
--
--
--
--
(1,431)
--
--
--
Income and expenses recognised
in net equity
--
--
--
(956)
--
3,410
720
--
(4,485)
(1,311)
--
(1,311)
P & L for the year
--
--
--
--
--
--
--
--
36,297
36,297
Dividend
--
--
--
--
--
--
--
--
(8,751)
(8,751)
--
(8,751)
Other transactions with members/owners --
--
--
--
--
--
--
6,097
--
6,097
--
6,097
Others
--
--
--
--
154
--
--
--
--
154
(342)
Balance at 31/12/10
116,683
57,043
17,031
(4,734)
(2,747)
828
61,582
6,097
196,701
448,484
28,682
477,166
Balance at 01/01/11
116,683
57,043
17,031
(4,734)
(2,747)
828
61,582
6,097
196,701
448,484
28,682
477,166
Distribution of P & L
Income and expenses recognised
in net equity
--
--
1,545
--
--
--
--
--
(1,545)
--
--
--
--
--
--
(1,700)
--
4,083
950
--
29
3,362
--
3,362
P & L for the year
--
--
--
--
--
--
--
--
50,140
50,140
281
50,421
Dividend
Other transactions with members
or owners
--
--
--
--
--
--
--
--
(9,724)
(9,724)
--
(9,724)
--
--
--
--
--
--
--
17,854
(5,286)
12,568
--
12,568
Others
--
--
--
--
780
--
--
--
--
780
(2,683)
116,683
57,043
18,576
(6,434)
(1,967)
4,911
62,532
23,951
230,315
505,610
Description:
Balance at 31/12/11
Share Registration Document
Legal
Hedging
Reserve Reserve
Conversion
Reserves from
Other
Revaluation of Net Equity
Assets and
Instruments
Liabilities
129
Differences
563
26,280
36,860
(188)
(1,903)
531,890
Share Capital
The amount of share capital subscribed for and paid up in PESCANOVA at 31
December 2011 was 116,683,524 euros, represented by 19,447,254 shares with a
nominal value of 6 euros each.
The Company which at 31 December 2011 held 10% or more of the share capital of
PESCANOVA, S.A. was SOCIEDAD ANÓNIMA DE DESARROLLO Y
CONTROL (SODESCO): 14.823%.
Treasury Instruments
Pursuant to the authorisation granted by the Ordinary Shareholders General Meeting
held on 8 April 2011, and in order to facilitate liquidity of the security at specific
times, during the financial year 31,333 own shares with a nominal value of 6 euros
each were disposed of, with a variation of 780 thousand euros.
NON-CURRENT LIABILITIES
Long term liabilities particularly include long term financial debt to credit institutions
with recourse, which at the end of 2011 amounted to 390 million and accounted for
42% of total non-current liabilities. This debt was structured with various Spanish and
foreign credit institutions. In addition, there were long term debts without recourse in
a value of 125 million euros directly connected with financing of the turbot projects in
Lugo and Portugal. Further details are provided in section 10, “Capital Resources”.
In April 2011, and with final maturity in 2017, convertible bonds were issued which
at the end of the 2011 financial year are included at a value of 164.4 million euros
amongst long term liabilities and which are reported in greater detail in section 21.
Non-current liabilities include the balance of deferred receipts which amounted to
111.5 million, with the balance having reduced since the beginning of 2011 by 8
million euros, resulting from regular repayments. The greater part of the balance was
due to subsidies received in the process of constructing the fish farm in Mira,
Portugal, and to a lesser extent Xove, to the north of the Rías Altas in the province of
Lugo, both connected with the farming of turbot and deriving from EU IFOP Funds.
CURRENT LIABILITIES
At the end of 2011 net financial debt, i.e. short term financial debt with recourse less
cash and banks, amounted to 53 million euros, compared with a net debt with recourse
in the previous year of 41 million.
The remaining short term liabilities comprise trade creditors (487.2 million) and other
short term accounts payable (132 million).
Documento de Registro de Acciones
130
Variations in 2010
NON-CURRENT ASSETS
Non-current assets decreased during 2010 by 6.5 million euros, -1% with respect to
the opening balance. Of total non-current assets, 89% relate to tangible fixed assets
which decreased by 0.2% during the year to 999 million euros and variations in and
the composition of which are reported in greater detail in sections 5.2.1 and 8.1,
“Investments and disinvestments in fixed assets (property, plants and equipment)”.
Goodwill fell in 2010 by 4.4 million as a result of provisions for impairment and
accounted for 6.3% of total non-current assets. Other intangible assets constituted
3.5% of total non-current assets and are reported in section 5.2.1, “Investments and
disinvestments in intangible assets”.
The Group did not acquire any holdings over the course of this financial year.
Movement in consolidation goodwill was as follows:
Thousands of euros
79,967
3,909
(8,700)
Opening balances 01/01/09
Additions
Reductions for impairment of assets
Closing balance 31/12/09
Additions
Reductions for impairment of assets
75,176
--(4,406)
Closing balance 31/12/10
70,770
During 2010 there were no additions to consolidation goodwill since there were no
purchases of companies nor were initial goodwill values modified. The reduction as a
result of impairment in assets derives from the new estimate of goodwill calculated as
indicated below.
The discount rate applied to cash flow projections was determined taking into account
the weighted average cost of capital of the Group corrected to reflect specific risks
associated with the different cash generating units analysed.
Increases occurring during 2009 derived basically from the purchase of Corporación
Novamar, S.A.C. and payment of a deferred variable acquisition price of Seabel,
S.A.S. The reduction for impairment of assets derived from the new estimate of the
value of goodwill calculated as shown in the previous paragraph.
In July 2009 acquisition was completed of control of Corporación Novamar, S.A.C.,
devoted to the transformation, commercialisation and catching of fish products on
acquisition by the Group of 50% of its capital. As a result of this acquisition it began
to be consolidated by global integration from 1 July 2009.
Share Registration Document
131
Intangible assets represented 2.7% of non-current assets, having been reduced in 2009
as a result of depreciation and sale of certain licences. Other variations during the year
were due to changes in the consolidation perimeter in the case of concessions and
licences and others which include purchases of IT programs.
CURRENT ASSETS
During 2010 current assets increased by 118 million euros, 12.5%. The main
component of current assets related to stocks which amounted to 578 million, an
increase of 79 million with respect to the previous year. This increase was principally
determined by biological assets, biomass, which rose by 68.6 million euros as a result
of maintaining industrial development of salmon and turbot farming activities as well
as prawns. Assets classified as held for sale are six of its vessels, all active, of the
Group’s fishing fleet, which it is estimated will be sold and may be replaced by other
more specialised vessels. They are valued at book cost (32.4 million euros), and
therefore their new classification did not give rise to any profit and loss and it is
estimated that their net sale price will be equal to or higher than this. In addition,
production or aquaculture land and installations and other assets principally located in
Europe, Australia, Central America and South America are in the same situation,
which are recorded at their book value (32.4 million euros) and the final sale price of
which is estimated will not be less.
The breakdown of stocks by uniform groups of activities and degree of termination,
and provisions made, are as follows:
Thousands of euros
Commercial stocks
Raw materials and other supplies
Products semi-completed and in progress
Completed products
Sub-products, waste, materials recovered and advances
Provisions
Total
31/12/2010
162,722
125,238
219,160
39,083
33,309
579,512
(904)
578,608
31/12/2009
157,197
105,775
141,501
35,323
59,796
499,592
(379)
499,213
There are no firm purchase and sale commitments nor future contracts relating to
stocks. There are no significant restrictions on the disposability of stocks as a result of
security, pledges, or other similar reasons, nor substantive circumstances which affect
the ownership, disposability or valuation of stocks, such as litigation, insurance or
attachments.
Biological assets relate to cultivated fish at different stages of growth, and are
recorded in the balance sheet under Products in Progress and Semi-completed.
No profit or loss was generated as a result of initial recognition of biological assets, or
as a result of changes in reasonable value less estimated costs at point of sale.
Share Registration Document
132
Movements during 2010 in these assets are shown below:
Biological Assets
Amount at 31 December 2009
Variation in stocks
Amount at 31 December 2010
Thousands of euros
113,986
68,610
182,596
The remaining components of current assets particularly include those related to trade
debts and others debts receivable, which amount to 262 million and account for 24%
of the total, having grown by 7.3% with respect to the previous year, a similar growth
and in line with growth in sales which originated debts receivable.
NET EQUITY
This amounted to 477 million and variations with respect to the previous year were
principally due to obtaining profits and distribution of dividends. Explanations
relating to capital and other own funds are included in section 10.
Breakdown and movements in net equity of the Group at 31 December 2010 and 2009
are as follows (thousands of euros):
Share Registration Document
133
Description:
Share
Capital
Issue
Premium
Legal
Reserve
Balance at 01/01/09
78,000
--
15,600
Distribution of P & L
--
--
--
Income expenses recognised
in net equity
--
--
--
P & L for the year
--
--
--
Dividend
--
--
38,683
Capital Increase
Others
Balance at 31/12/09
-116,683
Description:
Share
Capital
Balance at 01/01/10
(5,159)
--
148,830
294,095
28,214
322,309
--
--
--
--
--
--
--
--
901
--
901
493
32,584
2,577
--
--
--
--
--
32,091
32,091
--
--
--
--
--
--
(5,850)
(5.850)
61,894
--
--
--
--
--
--
--
(4,851)
--
--
--
--
--
--
60,862
--
175,071
15,600
Issue
Premium
Legal
Reserve
116,683
57,043
15,600
--
1,431
--
--
--
P & L for the year
--
--
--
Dividend
Other transactions with members
or owners
--
--
--
Others
(1,676)
(3,778)
(965)
(2,901)
(2,582)
Other
Reserve from Net Equity
Reserve for Conversion Revaluation of
own
Assets and Instruments
Securities Differences
Liabilities
Hedging
Reserve
(3,778)
--
(2,901)
(2,582)
60,862
--
Retained
Profit
175,071
--
--
--
--
(1,431)
--
3,410
720
--
(4,485)
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
6,097
--
--
--
--
154
--
--
116,683
57,043
17,031
828
61,582
(956)
(4,734)
(2,747)
134
Total
Net Equity
60,862
--
57,043
--
(1,936)
Net Equity
of
Minority
Shareholders
--
--
Share Registration Document
(2,102)
Retained
Profit
Total
Net Equity
of the
Parent
Company
--
Distribution of P & L
Income expenses recognised
in
net
Balance at 31/12/10
Hedging
Reserve
Other
Reserve from Net Equity
Reserve for Conversion Revaluation of
Assets and
Instruments
own
Liabilities
Securities Differences
36,297
(8,751)
100,577
(5,816)
--
(5,850)
--
100,577
(246)
(6,062)
415,998
28,461
Total
Net Equity
of the
Parent
Company
Net Equity
of
Minority
Shareholders
415,998
28,461
444,459
--
--
--
--
(1,311)
(1,311)
36,297
563
444,459
Total
Net Equity
36,860
(8,751)
--
(8,751)
--
6,097
--
6,097
--
--
154
6,097
196,701
448,484
(342)
28,682
(188)
477,166
Share Capital
The amount of share capital subscribed for and paid up in PESCANOVA at 31
December 2010 was 116,683,524 euros, represented by 19,447,254 shares with a
nominal value of 6 euros each.
The Company which at 31 December 2011 held 10% or more of the share capital of
PESCANOVA, S.A. was SOCIEDAD ANÓNIMA DE DESARROLLO Y
CONTROL (SODESCO): 14.823%
Treasury Instruments
Pursuant to the authorisation granted by the Ordinary Shareholders General Meeting
held on 6 April 2010 and in order to facilitate liquidity of the security at specific
times, during the financial year 4,721 own shares with a nominal value of 6 euros
each were disposed of, with a variation of 154 thousand euros.
NON-CURRENT LIABILITIES
Long term liabilities particularly include long term financial debt to credit institutions
with recourse, which at the end of 2010 amounted to 395 million and accounted for
49% of total non-current liabilities. This debt was structured with various Spanish and
foreign credit institutions. In addition, there were long term debts without recourse in
a value of 120 million euros directly connected with financing of the turbot projects in
Lugo and Portugal. Further details are provided in section 10, “Capital Resources”.
In March 2010, and with final maturity in 2017, convertible bonds were issued which
at the end of the 2010 financial year are included at a value of 104.2 million euros
amongst long term liabilities and which are reported on in greater detail in section 21.
Non-current liabilities include the balance of deferred income which amounted to
119.6 million, with the balance having reduced since the beginning of 2010 by 6
million euros, resulting from regular repayments. The greater part of the balance was
due to subsidies received in the process of constructing the fish farm in Mira,
Portugal, and to a lesser extent Xove, to the north of the Rías Altas in the province of
Lugo, both connected with the farming of turbot and deriving from EU IFOP Funds.
CURRENT LIABILITIES
At the end of 2010 net financial debt, i.e. short term financial debt with recourse less
cash and banks, amounted to 41 million euros, compared with a net debt with recourse
in the previous year of 206 million, having fallen by 165 million, the variation in
which is reported section 10.
The remaining short term liabilities comprise trade creditors (596.4 million) and other
short term accounts payable (131 million), an increase of 6.5% in parallel with the
general increase in turnover of the Group.
Documento de Registro de Acciones
135
Variations in 2009
NON-CURRENT ASSETS
Non-current assets increased during 2009 by 64.5 million euros, 6% with respect to
the opening balance. Of total non-current assets, 89% relate to tangible fixed assets
which decreased by 61.0% during the year to 1,001 million euros and variations and
composition of which are reported in greater detail in sections 5.2.1 and 8.1,
“Investments and disinvestments in fixed assets (property, plants and equipment)”.
Goodwill fell in 2009 by 4.8 million as a result of provisions for impairment and
accounted for 6.6% of total non-current assets. Other intangible assets constitute 2.7%
of total non-current assets and are reported in section 5.2.1, “Investments and
disinvestments in intangible assets”.
Over the course of the 2009 financial year the Group acquired the following holdings:
Name
Corporación Novamar S.A.C.
Activity
Registered Office
Production and commercialization of seafood products.
Peru
Percentage
Acquired
50.00%
Thousands of euros
Corporación
Balance at
Novamar
31/12/09
S.A.C.
Purchases
Total amount of purchases
1,000
1,000
Reasonable value of the net assets acquired
100
100
Difference
900
900
Goodwill generated
900
900
Share Registration Document
136
Acquisition
Date
01-Jul-09
The reasonable value and book amount of assets and liabilities identifiable at the date
of acquisition amounted to:
Corporación
Novamar S.A.C.
Cash and equivalents
Thousands of euros
Reasonable
Value
Amount in
Books
4
4
4
Properties, plants and equipment
128
128
128
Other fixed assets
376
376
376
Other current assets
539
539
539
Accounts payable
295
295
295
Loans received
513
513
513
Other long term liabilities
139
139
139
Net
100
100
100
---
---
---
100
100
100
Minority interests
Net assets acquired
Movement in consolidation goodwill was as follows:
Thousands of euros
52,878
1,094
Opening balance 01/01/08
Adjustments to opening balance
Additions
Reductions for impairment of assets
Closing balance 31/12/08
Additions
34,995
(9,000)
79,967
3,909
Reductions for impairment of assets
Closing balance 31/12/09
(8,700)
75,176
Increases occurring during the year derive basically from the purchase of Corporación
Novamar, S.A.C. and payment of a deferred variable acquisition price of Seabel,
S.A.S. The reduction for impairment of assets derives from the new estimate of the
value of goodwill calculated as shown in the following paragraph.
The discount rate applied to cash flow projections was determined taking into account
the weighted average cost of capital of the Group corrected to reflect the specific risks
associated with the different cash generating units analysed.
In July 2009 acquisition was completed of control of Corporación Novamar, S.A.C.,
devoted to the transformation, commercialisation and catching of fish products on
acquisition by the Group of 50% of its capital. As a result of this acquisition it began
to be consolidated by global integration from 1 July 2009.
Share Registration Document
137
Estimates for goodwill were made on a provisional basis.
Intangible assets represented 2.7% of non-current assets, having been reduced in 2009
as a result of depreciation and sale of certain licences. Other variations during the year
were due to changes in the consolidated perimeter in the case of concessions and
licences and others which include purchases of IT programs.
CURRENT ASSETS
During 2009 current assets increased by 52.8 million euros, 12.5%. The main
component of current assets relates to stocks which amounted to 499 million, very
similar to that at the end of 2008. There was a particular reduction in the general stock
level despite increase in biological stocks, from 94 to 114 million euros as a result of
commencement of industrial farming activities with prawns and turbot. Assets
classified as held for sale are eight of its vessels, all active, of the Group’s fishing
fleet, which it is estimated will be sold and may be replaced by other more specialised
vessels. They are valued at book cost (39 million euros), and therefore their new
classification did not give rise to any profit and loss and it is estimated that their net
sale price will be equal to or higher than this. In addition, production or aquaculture
land and installations and other assets principally located in Europe, Australia, Central
America and South America are in the same situation, which are recorded at their
book value (29.8 million euros) and the final sale price of which is estimated will not
be less.
The breakdown of stocks by uniform groups of activities and degree of termination,
and provisions made, are as follows:
Thousands of euros
Commercial stocks
Raw materials and other supplies
Products semi-completed and in progress
Completed Products
Sub-products, waste, materials recovered and advances
Provisions
Total
Share Registration Document
138
31/12/2009
157,197
105,775
141,501
35,323
59,796
499,592
(379)
499,213
31/12/2008
174,973
134,532
104,637
39,481
48,653
502,276
(356)
501,920
There were no firm purchase and sale commitments nor future contracts relating to
stocks. There were no significant restrictions on the disposability of stocks as a result
of security, pledges, or other similar reasons, nor substantive circumstances which
affect the ownership, disposability or valuation of stocks, such as litigation, insurance
or attachments.
Biological assets relate to cultivated fish at different stages of growth.
No profit or loss was generated as a result of initial recognition of biological assets, or
as a result of changes in reasonable value less estimated costs at point of sale.
Movements during 2009 under this balance sheet heading are shown below:
Biological assets
Amount at 31 December 2008
Variation in stocks
Amount at 31 December 2009
Thousands of euros
93,870
20,116
113,986
Accounts receivable amounted to 26% (25% in the previous year) of current assets,
due to the new customer portfolio composition mix.
NET EQUITY
This amounted to 444 million and variations with respect to the previous year were
principally due to the increase in capital obtaining profits and distribution of
dividends. Explanations relating to capital and other own funds are included in section
10.
Breakdown and movements in net equity of the Group at 31 December 2009 and 2008
are as follows (thousands of euros):
Share Registration Document
139
Description:
Share
Capital
Balance at 01/01/08
Issue
Premium
Reserves from
Reserve for Conversion Revaluation of
Assets and Retained
own
Liabilities
Profit
Securities Differences
Legal
Reserve
Hedging
Reserve
78,000
14,932
--
--
--
668
--
--
(1,889)
61,733
129,324
Total
Net Equity Net Equity
of
of the
Minority
Parent
Company Shareholders
282,100
29,146
311,246
--
--
--
Distribution of P & L
Income and expenses recognised
in
net
--
--
--
P & L for the year
--
--
--
--
--
--
--
25,765
25,765
Dividend
--
--
--
--
--
--
--
(5,850)
(5,850)
Inclusions and Removals of Companies --
--
--
--
--
--
--
--
Others
--
--
--
--
--
--
--
78,000
--
15,600
60,862
148,830
Balance at 31/12/08
Description:
Balance at 01/01/09
Income and expenses recognised
in net equity
Share
Capital
Issue
Premium
Legal
Reserve
(2,102)
(2,102)
--
15,600
(2,102)
--
--
--
(1,676)
P & L for the year
--
--
--
Dividend
--
--
38,683
Others
Balance at 31/12/09
Share Registration Document
-116,683
(1.936)
(1.936)
(3,270)
(5,159)
-(871)
(668)
259
Reserves from
Reserves for Conversion Revaluation of
Hedging
Assets and
Retained
own
Reserve
Liabilities Profit
Securities Differences
78,000
Capital Increase
--
--
(5,984)
-(1,936)
-(161)
--
(5,984)
25,604
(5,850)
(29)
(29)
(742)
(2,678)
294,095
28,214
Total
Net Equty
of the
Parent
Company
Net Equity
of
Minority
Shareholders
322,309
Total
Net Equity
(5,159)
60,862
148,830
294,095
28,214
322,309
--
2,577
--
--
901
--
901
--
--
--
--
32,091
32,091
493
32,584
--
--
--
--
--
(5,850)
(5,850)
--
(5.850)
61,894
--
--
--
--
--
100,577
--
100,577
(4,851)
--
--
--
--
--
60,862
175,071
57,043
15,600
(3,778)
(1,936)
Total
Net Equity
(965)
(2,901)
140
(2,582)
(5,816)
415,998
(246)
28,461
(6,062)
444,459
Share Capital
The amount of share capital subscribed for and paid up in PESCANOVA at 31
December 2009 was 116,683,524 euros, represented by 19,447,254 shares with a
nominal value of 6 euros each.
The Companies which at 31 December 2009 held 10% or more of the share capital of
PESCANOVA, S.A. were: CXG CORPORACIÓN CAIXAGALICIA, S.A., 20.00%,
and SOCIEDAD ANÓNIMA DE DESARROLLO Y CONTROL (SODESCO):
14.823%.
Treasury Instruments
Pursuant to the authorisation granted by the Ordinary Shareholders General Meeting
held on 24 April 2009 and in order to facilitate liquidity of the security at specific
times, there was acquisition during 2009 of 36,704 own shares with a nominal value
of 6 euros each at a total cost of 0.9 million euros.
NON-CURRENT LIABILITIES
Long term liabilities particularly included long term financial debt with recourse,
which at the end of 2009 amounted to 339 million and accounted for 53% of total
non-current liabilities. This debt was structured with various Spanish and foreign
credit institutions. In addition, there were long term debts without recourse in a value
of 103 million euros directly connected with financing of the turbot projects in Lugo
and Portugal. Further details are provided in section 10, “Capital Resources”.
Non-current liabilities include the balance of deferred income which amounted to
125.8 million, with the balance having increased since the beginning of 2009 by 8
million euros, resulting from regular repayments. The greater part of the increase was
due to subsidies received in the process of constructing the fish farm in Mira,
Portugal, and to a lesser extent Xove, to the north of the Rías Altas in the province of
Lugo, both connected with the farming of turbot (99 million in total, from EU IFOP
Funds).
CURRENT LIABILITIES
At the end of 2009 net financial debt, i.e. short term financial debt with recourse less
cash and banks, amounted to 206 million euros, compared with a net debt with
recourse in the previous year of 100 million, an increase of 106 million, the variation
in which is reported section 10.
The remaining short term liabilities comprise trade creditors (559.1 million) and other
short term accounts payable (123.7 million), a reduction of 7% with respect to the
previous year. The origin of the reduction is related to the reduction in investments in
fixed assets as well as balances payable to suppliers of fixed assets and similar which
form part of other short term accounts payable and which fell by 164.7 million to
123.7 million euros, 25%.
Documento de Registro de Acciones
141
B. INCOME STATEMENT
Thousands of euros
Sales
% Variation
10-11
% Variation
09-10
2011
2010
2009
1,670,664
1,564,825
1,472,976
6.76%
6.24%
16,100
21,355
17,387
-24.61%
22.82%
(13,174)
Other Operating Income
+/- Variation in stocks
15,057
23,217
-35.15%
-276.23%
1,117,968
1,057,593
971,465
5.71%
8.87%
Personnel Expenses
168,723
160,012
149,172
5.44%
7.27%
Other Operating Expenses
233,792
227,188
212,606
2.91%
6.86%
2.188
(1.255)
5,763
-274.34%
-121.78%
Supplies
Profit / (Loss) on Fixed Assets
GROSS OPERATING PROFIT (EBITDA)
183,526
163,349
149,709
12.35%
9.11%
61,671
56,883
48,022
8.42%
18.45%
OPERATING PROFIT AND LOSS
121,855
106,466
101,687
14.45%
4.70%
Net Financial Expenses
54,976
47,416
40,574
15.94%
16.86%
Depreciation of Fixed Assets
Exchange Rate Differences
1,246
(1,163)
(2,810)
-207.14%
-58.61%
P & L of Companies by the Equity Method
(4,286)
(3,569)
(2,294)
20.09%
55.58%
P & L on Temporary Financial Investments
(34)
(763)
(827)
-95.54%
-7.74%
2,638
1,057
1,326
149.57%
-20.29%
Income from Capital Holdings
P & L on Conversion
Provision for Impairment of Value of Assets
PRE-TAX PROFIT AND LOSS
(60)
(50)
(2,304)
20.00%
-97.83%
(1,607)
(4,878)
(8,700)
-67.06%
-43.93%
64,776
49,684
45,504
30.38%
9.19%
13,174
11,293
8,412
16.66%
34.25%
51,602
38,391
37,092
34.41%
3.50%
(1,181)
(1,531)
13.12%
Corporate Income Tax
P & L FOR YEAR ON CONTINUING OPERATIONS
P & L for the year on interrupted Operations (Net of Taxes)
(4,508)
PROFIT AND LOSS FOR YEAR
50,421
36,860
32,584
36.79%
PARENT COMPANY
50,140
36,297
32,091
38.14%
13.11%
281
563
493
-50.09%
14.20%
Minority Shareholders
The explanation of variations in Operating Profit are set out in section 9.2 of this
Registration Document.
The remaining items in the Profit and Loss Account are explained below.
Financial results.
Financial results include items relating to financial income and expenses, special
provisions basically related to impairment of assets, principally consolidation
goodwill, exchange rate differences and profit and loss on currency conversion.
During the 2010 financial year the breakdown was strengthened of the maturity
timetable of PESCANOVA Group financial debt, by the issue of convertible bonds in
the amount of 110 million euros and refinancing of syndicated loans and facilities in
the amount of 180 million euros, with maturity up to 2015. The costs of issue,
opening and placement of this financial liability led to an extraordinary non-recurring
increase in the total amount of financial expenses.
Share Registration Document
142
During the 2011 financial year, and as in the previous year, convertible bonds were
issued in the amount of 180 million euros maturing in 2017 and facilities were
refinanced in the amount of 150 million euros with maturity up to 2015. The costs
inherent in these operations further led to an extraordinary non-recurring increase in
financial expenses.
Tax on profits.
The average tax rate of the PESCANOVA Group has in recent years been between
10% and 22%, due to the weighting, based on individual results, of the rates in force
in each of the different countries in which Group Companies operate.
Net profit and loss on discontinued operations.
Between the 2009 and 2011 financial years it was considered that profit and loss
obtained in certain fishing activities with experimental fishing in unexplored fishing
grounds, principally located on the coasts of Uruguay and other nearby coastal areas,
was encouraging but made it advisable to postpone their operation for commercial
purposes to more suitable times, and therefore it was decided to discontinue these
practices completely in expectation of more propitious times. Furthermore, in the
south of Chile other aquaculture activities were also discontinued.
Consolidated profit and loss attributed to the Parent Company
Consolidated after-tax profit
60
(€m)
CAGR: 21.5% (2004-2011)
50
40
30
50
20
10
13
18
23
25
26
2006
2007
2008
32
36
2009
2010
0
2004
Share Registration Document
2005
143
2011
In 2009 it grew by 24.9% with an increase in sales of 9.7%. In 2010 it grew by 13%
with an increase in sales of 6.2%. In 2011 it grew by 38% with an increase in sales of
6.7%.
Net profit and loss attributed to the Parent Company grew in the years included in the
historical period, from 12.5 in 2004 to 50.1 million euros.
C. CASH FLOW STATEMENT.
Set out in section 10.2 of this Registration Document.
D. ACCOUNTING POLICIES AND EXPLANATORY NOTES.
These are set out in the Annual Financial Statements for the 2009, 2010 and
2011 financial years.
20.2 Pro-forma financial information.
Not applicable.
20.3 Financial Statements.
If the issuer prepares both own and consolidated annual financial statements,
include at least the consolidated annual financial statements in the registration
document.
Section 20.1 incorporates consolidated annual financial statements for the 2009/2011
period.
20.4 Auditing of historical financial information.
20.4.1 A statement that the historical financial information has been audited. If audit
reports on the historical financial information have been refused by the
statutory auditors or if they contain qualifications or disclaimers, such refusal
or such qualifications or disclaimers must be reproduced in full and the
reasons given.
As described in the previous section 20.1, the firm of BDO AUDITORES, S.L. has
audited the financial information of PESCANOVA and its Consolidated Group for
the 2009, 2010 and 2011 financial years. The audit reports issued on information
on these years contained a favourable opinion without qualifications.
20.4.2 Indication of other information in the registration document which has been
audited by the auditors.
Not applicable.
Share Registration Document
144
20.4.3 Where financial data in the registration document is not extracted from the
issue’s audited financial statements, state the source of the data and state that
the data is unaudited.
Not applicable.
20.5 Age of latest financial information.
The most recent audited Consolidated Annual Financial Statements included in this
Registration Document relate to the financial year ended 31 December 2011.
20.6 Interim and other financial information.
Unaudited consolidated financial information at 31 March 2012 is included below.
BALANCE SHEET
Thousands of euros
1st Quarter
2012
ASSETS
31.12.2011
% Variation
11-12
NON-CURRENT ASSETS
1,118,793
1,120,143
-0.1%
Tangible Fixed Assets
1,005,220
1,004,782
0.0%
Intangible Fixed Assets
37,066
37,931
-2.3%
Goodwill
70,772
70,880
-0.2%
113
2,242
-95.0%
Long Term Financial Investments
1,903
358
431.6%
Deferred Taxes
3,719
3,950
-5.8%
1,113,680
1,156,338
-3.7%
Stocks
676,396
676,805
-0.1%
Trade Debtors and Other Accounts Receivable
247,044
259,259
-4.7%
1,853
1,748
6.0%
Cash and Equivalents
114,705
142,636
-19.6%
Other Current Assets
73,682
75,890
-2.9%
2,232,473
2,276,481
-1.9%
Investments recorded by the Equity Method
CURRENT ASSETS
Short Term Financial Investments
TOTAL ASSETS
Share Registration Document
145
Thousands of euros
1st Quarter
2012
NET EQUITY AND LIABILITIES
NET EQUITY
% Variation
11-12
2011
525,245
531,890
-1.2%
499,934
505,610
-1.1%
25,311
26,280
-3.7%
LONG TERM LIABILITIES
911,849
924,275
-1.3%
Deferred Income
109,655
111,522
-1.7%
496
2,622
-81.1%
Bonds and Other Negotiable Securities
346,525
244,704
100.0%
Long Term Financial Debt Without Recourse
121,320
125,320
-3.2%
Long Term Financial Debt With Recourse
293,534
390,059
-24.7%
40,319
50,048
-19.4%
795,379
820,316
-3.0%
1,510
4,803
-68.6%
Short Term Financial Debt With Recourse
184,203
196,041
-6.0%
Trade Creditors and Other Short Term Accounts Payable
609,666
619,472
-1.6%
2,232,473
2,276,481
-1.9%
Of the Parent Company
Of Minority Shareholders
Long Term Provisions
Other Long Term Accounts Payable
SHORT TERM LIABILITIES
Short Term Financial Debt Without Recourse
TOTAL NET EQUITY AND LIABILITIES
INCOME STATEMENT
1st Quarter
2012
Sales
1st Quarter
2011
350,960
Other Operating Income
% Variation
11-12
329,571
6.49%
2,842
2,710
4.87%
227,333
214,564
5.95%
Personnel Expenses
38,387
36,004
6.62%
Other Operating Expenses
49,860
47,433
5.12%
96
--
100.00%
GROSS OPERATING PROFIT (EBITDA)
38,318
34,280
11.78%
Depreciation of Fixed Assets
15,080
13,892
8.55%
OPERATING PROFIT AND LOSS
23,238
20,388
13.98%
Net Financial Expenses
Cost of Sales
Profit / (Loss) on Fixed Assets
14,272
11,076
28.86%
Exchange Rate Differences
437
623
-29.86%
Profit and Loss of Companies by the Equity Method
(341)
(642)
-46.88%
Income from Capital Holdings
809
623
29.86%
Profit and Loss on Conversion
15
11
36.36%
9,886
9,927
-0.41%
864
1,291
-33.08%
9,022
8,636
4.47%
3.72%
PRE-TAX PROFIT AND LOSS
Corporate Income Tax
PROFIT AND LOSS FOR YEAR FROM ONGOING OPERATIONS
Profit and loss for year from Interrupted Operations (Net of Tax)
(65)
PROFIT AND LOSS FOR YEAR
8,957
8,636
PARENT COMPANY
9,042
8,553
5.72%
83
-202.41%
Minority Shareholders
Share Registration Document
(85)
146
RESULTS BY BUSINESS UNIT
(€m)
AQUACULTURE
Q1 2012
Q1 2011
TURNOVER
CRUSTACEANS
FISH
114.9
81.5
30.4
95.6
67,8
27.9
EBITDA
%
CRUSTACEANS
%
FISH
%
13.4
11.7%
8.9
10.9%
4.5
14.8%
10.4
10.9%
4.7
6.9%
5.7
20.6%
TURNOVER
EBITDA
%
236.1
24.9
10.5%
234.0
23.9
10.2%
TURNOVER
EBITDA
%
351.0
38.3
109%
329.6
34.3
10.4%
TRADITIONAL BUSINESS
TOTAL
The same trend which was seen in the analysis of evolution of profit and loss by
business unit during the 2007 to 2011 period (section 6.1.1.) was maintained in the
last quarter where growth was achieved of 6.5% in sales and 11.7% in EBITDA,
caused by growth of 20.2% in sales and 28.8% in EBITDA in aquaculture products
and growth of 0.9% in sales and 4.2% in EBITDA in the traditional area.
The growth in the first quarter in the aquaculture area is reinforced by the fact that
sales of crustaceans grew by 20.2% whilst EBITDA grew by 89.3%. This effect,
which can also be seen in analysis of the complete year 2011 compared with 2010
(section 6.1.1.) where an increase in EBITDA of 7.9% in sales of cultivated
crustaceans led to an increase of 69.1% in EBITDA, results from the process of
replacing products without added value (trading) by products cultivated and processed
by the Group with high added value. Furthermore, in the fish field, which includes
salmon species, turbot and tilapia, it can be seen that the EBITDA generated in the
first quarter of 2012, and which amounts to 4.5 million euros, fell with respect to the
same period in the previous year, as a result of a fall in prices of Atlantic salmon.
Share Registration Document
147
BREAKDOWN OF SALES BY GEOGRAPHIC AREAS
1st quarter
2012
%
Internal Market
160,975
46%
Export:
189,985
54%
European Union
88,406
25%
Other Countries
101,579
29%
350,960
100%
(Thousands of euros)
Total
CASH FLOW STATEMENTS
Consolidated Cash Flow Statement
Thousands of euros
st
st
1 Quarter
2012
Gross P & L before tax and outside shareholders
Depreciation
1 Quarter
2011
9,886
9,927
15,080
13,892
Profit and loss on interrupted operations
(65)
---
Profit and loss on sales of assets
(96)
(10)
(864)
(1,291)
(13,578)
(4,761)
10,363
17,757
5,026
(75,862)
15,389
(58,105)
(14,068)
(11,266)
Corporate income tax
Other profit and loss which does not generate movement of funds
Funds generated from operations
Variation in current operating assets/liabilities
NET CASH FLOWS FROM
OPERATING ACTIVITES
Acquisitions of tangible and intangible fixed assets
Disposals of assets and receipts from investments
Disposals of other investments
339
3
Subsidies and other deferred income
NET CASH FLOWS EMPLOYED IN
INVESTMENT ACTIVITIES
Issue/redeemption of Equity Instruments
1,687
(26)
(1,120)
(1,063)
(14,846)
(10,668)
(4,908)
---
Drawdowns of long term financial debt
191,607
37,319
Repayments of long term financial debt
(190,312)
(35,236)
(15,132)
54,471
(9,729)
(3,814)
NET CASH FLOWS FROM FINANCING ACTIVITIES
(28,474)
52,740
TOTAL NET FLOWS
(27,931)
(16,033)
VARIATION IN CASH AND EQUIVALENTS
(27,931)
(16,033)
INITIAL CASH AND OTHER EQUIVALENTS
142,636
131,447
FINAL CASH AND OTHER EQUIVALENTS
114,705
115,414
Net flow of financial debt with short term maturity
Other receipts/(payments) on financing activities
Share Registration Document
148
During the first quarter of 2012 the same evolution continued as occurred over the
course of 2011, since turnover continued to expand by 6.5% in the last quarter whilst
the profit generated on operations, EBITDA, grew by 11.7% (both with respect to the
same first quarter in the previous year). The increase in sales took place in the Spain
area (+1% in the first quarter of 2012) and especially outside Spain where sales grew
by 12%, as they did in 2011, in particular in established markets such as the USA,
Japan and France, as well as emerging markets such as China, Russia, Mexico and
Brazil. This expansion was in parallel to progressive maturity of aquaculture projects,
particularly salmon and vannamei prawn. The EBITDA/sales margin grew 50 basis
points from 10.4% to 10.9%, and therefore growth was maintained of 50 basis points
since the end of 2010.
The continuing increase in margins, sales and EBITDA was determined by the
gradual maturity of aquaculture projects for salmon, vannamei prawn and turbot,
which involved major investments in fixed assets between 2005 and 2009 and final
maturity of which will be obtained, as forecast, in 2013/2014 without the need for
further investments.
It can be emphasised that the evolution of EBITDA in the first quarter of quarter 2012
(and over the whole of 2011) was reinforced by the slight increase in margins
(EBITDA to sales) in the traditional business which covers fishing, transformation,
trading and commercialisation (4% with respect to the same quarter in the previous
year) and a large increase in margin (EBITDA to sales) deriving from aquaculture
products, 29% in the first quarter of 2012 with respect to 2011, 39% in 2011 with
respect to 2010, and 34% in 2010 with respect to 2009.
Profit and loss after tax during the first quarter of 2012 grew by 5.7%, reaching a total
of 9 million euros. This positive result derives from the good evolution of operating
profit by reason of increases in production in the aquaculture area, both turbot as well
as salmon and prawns, as well as good upward movement in the prices of prawns and
turbot.
The change in the origin of aquaculture products was particularly important, which
tend to be mainly of own production, thereby replacing products purchased from third
parties without any preparation process. In this manner a moderate increase in
turnover in the vannamei prawn area (20% in the first quarter 2012 and 8% in 2011
with respect to the previous year) led to a huge increase in EBITDA which grew by
89% in the first quarter of 2012 with respect to the first quarter of 2011, and 69% in
the previous year.
Share Registration Document
149
The evolution of prices overall was stable with an upward effect. Prices were
increased or maintained of prawns, hake species and cephalopods, as well as those of
coho (Pacific) salmon and rainbow trout. Only the prices of Atlantic salmon fell in the
last 12 months, although they have been recently recovering.
Non-current assets scarcely underwent a net variation during the first quarter of 2012
(1.00%) as a result of the investment policy pursued for years since the investments
made at the present time are almost maintenance since they are very similar to the
figures which are depreciated.
With respect to current assets it can be seen that during the first quarter of 2012 there
was a reduction of 43 million mainly due to the use of cash and banks which fell by
28 million as well as the reduction in balances receivable which generated 7 million,
whilst the stock figure remained similar to that at the beginning of the year, broken
down into a slight increase in biomass (+6M) and a fall of similar size in other stocks.
Current liabilities fell by 10 million as a result of the volume of purchases in the first
quarter, less than the volume of purchases in the last quarter of the year.
Overall, current assets generated positive cash flow of 5 million, cutting the negative
trend seen in the 2011 financial year.
20.7 Dividend policy
In accordance with current legislation, the General Meeting resolved to apply profit
and loss in accordance with the approved Balance Sheet (Section 273 of the Capital
Companies Act), determining, in the resolution, the time and manner of payment
(Section 276 of the said Act).
The Company has not resolved on any policy with respect to the distribution of
dividends; during recent financial years a dividend has been paid of 0.45 euros gross
per share in 2009, 0.50 euros gross for 2010 and 0.55 euros gross in 2011. The total
amount by way of dividends constitutes the following percentages of Net Profit of the
Parent Company: in the 2009 financial year, 61%, 63% in 2010, and 66% in 2011.
Share Registration Document
150
20.7 The amount of the dividend per share for each financial year for the period covered by
the historical financial information adjusted, where the number of shares in the issuer
has changed, to make it comparable. Profits and dividend per share.
Details are given below of profit and loss and dividends per share in relation to
PESCANOVA:
DATA (Thousands of euros)
2011
Profit per share
2009
0,83
0,79
2,61
10.696
9.724
8.751
0,55
0,50
0,45
19.447.254
19.447.254
19.447.254
Profits devoted to dividends
Dividend per share
Number of shares
2010
20.8 Legal and arbitration proceedings.
Neither PESCANOVA nor its Group are involved or have been involved in the 12
months prior to the date of this Document in any governmental, legal or arbitration
proceedings (including proceedings pending or those which the ISSUER is aware will
affect it) which could have or in the recent past have had a significant effect on
PESCANOVA or its Group and/or their financial position or profitability.
Furthermore, to date there have been no challenges of corporate resolutions passed by
PESCANOVA bodies.
20.9 Significant changes in the issuer’s financial or trading position.
A description of any significant change in the financial or trading position of the
group which has occurred since the end of the last financial period for which
either audited financial information or interim financial information have been
published, or provide an appropriate negative statement.
There has been no significant change in the financial or trading position of the
PESCANOVA Group since the last financial period for which financial information
was published, i.e. 31 March 2012.
Share Registration Document
151
21. ADDITIONAL INFORMATION
21.1.
Share Capital.
21.1.1. The amount of issued capital, and for each class of share capital: number of
shares authorised, the number of shares issued and fully paid and issued but
not fully paid, the par value per share or that the shares have no par value,
and a reconciliation of the number of shares outstanding at the beginning and
end of the year. If more than 10% of capital has been paid for with assets
other than cash within the period covered by the historical financial
information, state that fact.
The amount of nominal capital subscribed for and paid up in PESCANOVA at the
date of Registration of this Document was 116,683,524 euros, represented by
19,447,254 shares, with a nominal value of 6 euros each.
The share capital increased during the period covered by the historical financial
information, form 78 million euros (13 million shares) at 1 January 2009 to the
current situation by the capital increase made in the fourth quarter of 2009.
21.1.2. If there are shares not representing capital, state the number and main
characteristics of such shares.
PESCANOVA does not have shares which do not represent capital.
21.1.3. The number, book value and face value of shares in the issuer held by or on
behalf of the issuer itself or by subsidiaries of the issuer.
At 31 December 2011 treasury shares held by the Company amounted to 69,428
shares with a book value of 1.9 million euros and a nominal value of 416,568.
YEAR END
TRANSACTIONS
SECURITIES
YEAR
PURCHASES
SALES
NO. SECURITIES. % CAPITAL
BOOK VALUE
NOMINAL VALUE
P&L
(000 €)
2008
76,788
8,000
68,788
0.53%
1,936,000
412,728
(17)
2009
37,954
1,250
105,492
0.54%
2,901,000
632,952
(1)
2010
40,005
44,736
100,761
0.52%
2,747,000
604,566
(85)
2011
0
31,333
69,428
0.35%
1,900,000
416,568
(75)
31.03.2012
0
0
69,428
0.35%
1,900,000
416,568
0
Share Registration Document
152
21.1.4. The amount of any convertible securities, exchangeable securities or securities
with warrants, with an indication of the conditions governing and the
procedures for conversion, exchange or subscription.
A Issues of Convertible Bonds:
1. February 2012 Issue (hereinafter 2019 Bonds):
During the month of February PESCANOVA issued Convertible Bonds and/or
Bonds Exchangeable for shares of the Company on the final terms of the Issue:
Issuer
Ranking
Amount
Maturity
Conversion premium
Initial Price of Conversion
Total number of underlying
shares
Coupon
Structure
Conversion period
Modes of conversion/exchange
Early redemption at the
option of the ISSUER
Early redemption at the
option of the investor
Share Registration Document
PESCANOVA, S.A.
Senior, unsecured.
€160 million
Net receipts (before tax and commissions) of
approximately €100 million (after deducting the cash
amount of Repurchase).
7 years, with an option for early maturity at election of
the investor on the fourth anniversary of the Issue.
25% of the weighted average price based on volume of
contracting shares of the ISSUER in the Stock Exchange
interconnection system (“Continuous Market”) during
the period between announcement of the Issue and the
time of fixing its final terms.
€32.81
4.88 million shares (approximately 25.1% of share
capital).
8.75% per year, half-yearly payment.
Par/Par Structure.
Subject to the terms and conditions of the Issue, from 29
March 2012 until no later than the seventh day prior to
the maturity date. If the ISSUER has exercised an early
redemption option, until the seventh day prior to the
date fixed for the redemption.
Into shares (new or existing), cash or a combination of
both, at the option of the ISSUER and in a combination
of cash and shares at the option of the Bondholder in
certain cases established in the Terms and Conditions.
After 4 years and 15 days have elapsed provided that the
market value of the underlying shares exceeds the
conversion price by 30%.
At any time if over 85% of the nominal value of the
ISSUER has been converted, redeemed or repurchased
and cancelled, at a par plus current coupon.
On the fourth anniversary of the Issue, at par plus
current coupon.
In the event of change of control of the ISSUER, at par
153
Protection against dividend
payment
Mode of international
placement
Listing
Use of the funds
plus current coupon.
Adjustment of the conversion price in the event of
payment of dividends above the values indicated below
for each year: 2012 €0.55; 2013 €0.74; 2014 €0.91;
2015 €1.05; 2016 €1.15; 2017 €1.25; 2018 €1.41; and
2019 €1.59.
Regulation S under the US Securities Act 1933.
Luxembourg EuroMTF Market (not regulated).
Net receipts from the Issue will be devoted to
diversification of the sources of financing of the
ISSUER, strengthening its financial resources and partly
to financing the Repurchase.
On 17 February 2012, after registration of the corresponding notarised public
deed relating to the issue in the Pontevedra Commercial Registry, subscription
and payment up took place of the whole of the issue of Convertible Bonds
and/or Bonds exchangeable into shares of PESCANOVA, in the amount of 160
million euros. The Bonds were admitted to trading on the EuroMTF Market of
the Luxembourg Securities Exchange.
At the date of Registration of this Document no application for exchange has
been submitted by bondholders.
2. April 2011 Issue (hereinafter 2017 Bonds):
On 20 April 2011 PESCANOVA, S.A. completed the process of placing the
issue of Convertible Bonds amongst qualified and institutional investors in the
amount of 180 million euros, maturing in April 2017.
In accordance with the Terms and Conditions, the Bonds will be exchangeable,
at the option of bondholders, at any time during the life of the Bonds at a fixed
price. The ISSUER may decide at the time when investors exercise their right of
exchange, whether to deliver shares in the Company, cash or a combination of
cash at the nominal amount and shares for the difference. The ISSUER has at
each time expressly notified bondholders of the selected payment option.
Furthermore, the ISSUER will have the option to redeem the Bonds at any time
in the event that (i) less than 15% of the Bonds issued remain in circulation, or
(ii) as from 5 March 2014, if the shares underlying the Bonds during a certain
period of time represent a percentage equal to or in excess of 132% of the
nominal value of the Bonds.
PESCANOVA, S.A. intends on any future circumstances to exercise its right to
deliver shares in exchange for the Bonds.
In summary, the Terms and Conditions of the issue which were finally fixed are
as follows:
a) Amount, 180 million with maturity after six years.
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154
b) Initial conversion price: 36.24 euros.
Total number of underlying shares: 4.966 million.
c) Fixed annual interest rate payable half-yearly of 5.125, plus a repayment
premium (repayment price on maturity 111.78%, total yield on the Bond
6.75%).
d) The Bonds will be exchangeable, at the option of bondholders, for new or
existing shares of the Company.
In accordance with the Terms and Conditions, the ISSUER may decide at the
time when investors exercise their right of exchange whether to deliver
shares in the Company or a combination of cash for the nominal amount and
shares for the difference. PESCANOVA, S.A. intends, on any future
circumstances, to exercise its right to deliver shares in exchange for the
Bonds.
3. March 2010 Issue (hereinafter 2015 Bonds):
On 5 March 2010 PESCANOVA, S.A. completed the process of placing the
issue of Convertible Bonds in the amount of 110 million euros amongst
qualified and institutional investors. In summary, the Terms and Conditions of
the issue which were finally fixed are as follows:
a) The issue of Bonds is made in the amount of 110 million euros with maturity
after five years.
b) Initial conversion price: 28.02 euros.
Total number of underlying shares: 3.925 million.
c) The Bonds will accrue fixed annual interest rate payable half-yearly of
6.75% annually.
d) The Bonds will be exchangeable at the option of bondholders for new or
existing shares in the Company.
In accordance with the Terms and Conditions the ISSUER may decide, at the
time when investors exercise their right of exchange, whether to deliver
shares in the Company or a combination of cash for the nominal amount and
shares for the difference. PESCANOVA, S.A. intends, in any future
circumstances, to exercise its right to deliver shares in exchange for the
Bonds.
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155
B Cash assets from issues:
1. February 2012 Issue (hereinafter 2019 Bonds):
Initial payment up
Repurchase of Bonds March 2010 Issue
Repurchase of Bonds April 2011 Issue
160.00 Million €
43.63 Million €
16.03 Million €
Net outlay (before expenses and commissions)
100.34 Million €
(Nominal 37.45 M.€)
(Nominal 16.15 M.€)
2. April 2011 Issue (hereinafter 2017 Bonds):
Initial payment up
Repurchase of Bonds March 2010 Issue
180.00 Million €
31.90 Million €
Net outlay (before expenses and commissions)
148.10 Million €
3. March 2010 Issue (hereinafter 2015 Bonds):
Initial outlay =
= Net outlay (before expenses and commissions)
110.00 Million €
C Evolution of issues (nominal amount pending repayment):
1. February 2012 Issue (hereinafter 2019 Bonds):
Initial outlay
Nominal amount pending repayment
at present date
160.00 Million €
160.00 Million €
2. April 2011 Issue (hereinafter 2017 Bonds):
Initial outlay
Repurchase February 2012 Issue
Nominal amount pending repayment
at present date
Share Registration Document
180.00 Million €
16.15 Million €
163.85 Million €
156
(Nominal 26.60 M.€)
4. March 2010 (hereinafter 2015 Bonds):
Initial outlay
Repurchase of April 2011 Issue
2011 repurchases
Repurchase February 2012
Nominal amount pending repayment
at present date
110.00
26.60
0.50
37.45
Million €
Million €
Million €
Million
45.45 Million €
21.1.5. Information about and terms and conditions of any acquisition rights and/or
obligations with respect to capital authorised but unissued or an undertaking
to increase capital.
At the Shareholders General Meeting held on 13 April 2012 authorisations were
renewed for the Board of Directors to issue convertible debentures and bonds and,
during a period of five years, to increase the capital of the Company on one or
more occasions up to one half of share capital, i.e. 58,341,762 euros, at the time of
the authorisation, with or without premium and at the time and in the amount it
considers suitable, consequently authorising it to modify Article 7 of the Articles
of Association of the Company.
21.1.6. Information about any capital of any member of the group which is under
option or agreed conditionally or unconditionally to be put under option and
details of such options, including those persons to whom such options relate.
There are no options of any Company over the capital of PESCANOVA or of its
subsidiaries nor has it been agreed conditionally or unconditionally to subject it to
any option.
21.1.7. A history of share capital, highlighting information about any changes, for the
period covered by the historical financial information.
The modifications during the period covered by the historical financial
information:
Date of
resolution
Type of operation
Nominal
amount
euros
24/04/2009
Increase in capital with premium
38,683,524
Resulting
no. of
shares
Resulting
capital
euros
19,447,254
116,683,524
At its meeting of 24 April 2009 the Ordinary Shareholders General Meeting of
PESCANOVA resolved to delegate power to the Management Body to increase the
share capital of the Company, consequently at the Board meeting held on 1
October 2009, attended by all members, it was resolved to increase share capital by
the amount of thirty eight million six hundred and eighty three thousand five
hundred and twenty four euros (38,683,524 euros) by the issue of six million four
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157
hundred and forty seven thousand two hundred and fifty four (6,447,254) new
shares with a nominal value of six euros (6 euros) each, of the same class and
series and with the same rights as the other shares of PESCANOVA in circulation
as from the date on which the capital increase is declared subscribed for and paid
up, with express provision for the possibility of incomplete subscription. The said
shares would be subscribed for at an issue premium of nine euros and sixty cents
(9.60 euros) per share.
On compliance with the periods and conditions for subscription and payment up of
the new shares, and with the increase having been covered in full, the share capital
of PESCANOVA was fixed at one hundred and sixteen million six hundred and
eighty three thousand five hundred and twenty four euros (116,683,524 euros)
represented by nineteen million four hundred and forty seven thousand two
hundred and fifty four (19,447,254) shares with a nominal value of six euros (6
euros), all of the same class and series, and all fully subscribed for and paid up.
An explanatory table is included below of the principal characteristics of the
increases referred to.
FINANCIAL YEAR
Date of resolutions passed by the Shareholders General Meeting
Amount of increase (euros)
24/04/2009
38,683,524
Final Variation (euros)
38,683,524
Premium
of 9.60 euros
100 new shares
for 202 old shares
Conditions
Proportion
Theoretical Value of free allotment right(1)/subscription right
(1)
2009
2.85
Theoretical value calculated in accordance with the following formula:
D = N x (C - E)
V
Where:
D = Value in euros of the right of free allotment.
N = Number of new shares.
C = List price (in euros) of old shares. The list value is taken from closing of the day prior to the stock
exchange execution of the 2009 increase (24.20 euros).
E = Issue price of new shares.
V= Number of shares after the increase.
After the said operations no change has taken place in the capital of
PESCANOVA, S.A.
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158
21.2.
Articles of Association and incorporation document.
21.2.1. A description of the issuer’s objects and purposes and where they can be
found in the incorporation document and articles of association.
The corporate objects of PESCANOVA are determined by Article 2 of the Articles
of Association, which is literally worded as follows:
“The industrial operation of all activities connected with products destined for
human or animal consumption, including their production, transformation,
distribution, commercialisation and other complementary activities or those
deriving from the principal activity, both of an industrial and commercial nature,
as well as participation in national or foreign undertakings”.
The Articles of Association can be consulted at the registered office of
PESCANOVA, at Rúa José Fernández López s/n, Chapela, Redondela
(Pontevedra), on the website (www.pescanova.com) and in the Pontevedra
Commercial Registry.
The incorporation document of PESCANOVA can also be consulted in the said
Commercial Registry.
21.2.2. A summary of any provisions of the issuer’s articles of association or internal
regulations with respect to the members of the administrative, management
and supervisory bodies.
The articles from the Articles of Association of PESCANOVA which regulate the
regime of functioning of the Board are transcribed below:
“Article 33. Election. The Shareholders General Meeting shall be responsible for
designating persons, whether or not shareholders, to manage, administer and
represent the Company as permanent body. Those designated shall constitute a
Board of Directors comprising a number of members of not less than three nor
more than fifteen. Within these limits the said General Meeting shall determine
the number.
Article 34. Representation of minorities. Shares which are voluntarily grouped
until meeting a capital figure equal to or exceeding that resulting from dividing it
by the number of members which has been established by the Shareholders
General Meeting between the minimum and maximum established in Article 33 of
the Articles of Association, shall be entitled to elect those who, exceeding whole
fractions, result from the corresponding proportion. This rule shall be applied
even in the case of partial renewals. In order to exercise the right granted it shall
be essential that at least five days prior to the date of the General Meeting notice
thereof is given to the Board of Directors in writing and recording the shares
deposited for this purpose.
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159
After exercising the said right, the shares involved therein shall not take part in
election of the remaining members of the Board.
Article 35. Disqualification. Directors of the Company need not be shareholders.
Persons subject to any grounds of disqualification laid down by law may not be
elected.
Article 36. Officers. The Board of Directors shall from within it designate the
person to carry out the functions of Chairman; it shall designate a Secretary, a
position which may be held by a non-director; it may regulate its own
functioning; it shall accept the resignation of Directors and may from within it
designate an Executive Committee and one or more Managing Directors.
Article 37. Effective date. The appointment of Directors shall take effect from the
time of their acceptance. As from the date thereof, within a period of ten days, the
document shall be submitted for registration recording acceptance in the
Commercial Registry, setting out the first and last names, age, address and
nationality, if natural persons, or corporate name, registered office and
nationality if legal persons, and other information laid down in Section 38 of the
Commercial Registry Regulations.
Article 38. Powers and functions of the Board. The Board of Directors shall have
the fullest powers, and be responsible for resolving on and carrying out all
matters not expressly reserved to the General Meeting by law or these Articles of
Association.
It shall therefore have full representation of the Company and on behalf thereof
may engage in all types of acts and contracts, whether of ordinary or
extraordinary administration, disposal, obligations or ownership, whether civil,
commercial, of governance or of any other nature, and may consequently carry
out everything which the Company in itself can carry out without exception other
than as set out in the previous paragraph of this Article.
In accordance with the provisions of the Companies Act, and the requirements
laid down therein, the Board of Directors may delegate all or part of its powers
except for those which are incapable of delegation by law, to an Executive
Committee and to Managing Directors.
Article 39. The Chairman. The Chairman shall have maximum authority and
representation of the Company, chair Shareholders General Meetings and
meetings of the Board of Directors. The same may convene meetings of the Board
of Directors when considered appropriate and with a casting vote settle ties
which may occur within it.
Article 40. The Secretary. The Secretary shall be responsible for certifying
resolutions of the Board and the General Meeting. He shall also be responsible
for drawing up minutes and for custody of the records of the Company.
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160
In the event of absence, impossibility or vacancy, he shall be replaced in the said
functions by the Director of lowest age, or, in default, the Director designated by
a majority of Board members.
Article 41. Liability and remuneration. Directors shall carry out their functions
with the diligence of an orderly trader and loyal representative. They shall be
subject to the liability determined by the Companies Act and any other legally
applicable.
Directors shall be entitled to fixed annual remuneration and attendance
allowance, and reimbursement of travelling expenses.
The foregoing receipts shall be compatible with and independent of the
remuneration or financial benefits of an employment nature which any director
may receive for services or functions other than carrying out the functions of
Director.
Article 42. Term of office. The term of office of Directors is fixed at five years,
without prejudice to re-election which may take place indefinitely.
The Board itself may on a temporary basis fill vacancies from amongst
shareholders which arise until the next General Meeting which is held, in
accordance with the provisions of the Companies Act.
Article 43. Removal. The Shareholders General Meeting may resolve at any time
to remove the Directors, or any of them, as well as appointments necessary to fill
vacancies.
Article 44. Delegation of powers. Without prejudice to the grant of powers which
the Board of Directors considers appropriate, the Board may delegate all or part
of its powers, other than those incapable of delegation. In order for such
delegation resolutions to be valid votes in favour shall be required by two thirds
of Directors and shall not take effect until registration in the Commercial
Registry”.
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161
On 1 April 2004 the Regulations of the Board of Directors itself were approved,
which can be consulted on the website (www.pescanova.com). These Regulations
have the purpose of determining the principles under which the Board of Directors
of PESCANOVA, S.A. acts, the basic rules of its organisation, internal regime and
functioning, as well as rules governing conduct of its members.
The Regulations must be interpreted in accordance with provisions of the law and
articles of association which may be applicable. Doubts or problems in
interpretation which may arise in application of these Regulations shall be resolved
by the Board of Directors.
Modification of the Regulations may be considered on proposal of the Chairman,
any Director or the Secretary of the Board of Directors.
21.2.3. A description of the rights, preferences and restrictions attaching to each class
of the existing shares.
The share capital of PESCANOVA is divided into NINETEEN MILLION FOUR
HUNDRED AND FORTY SEVEN TWO HUNDRED AND FIFTY FOUR
(19,447,254) shares with a nominal value of SIX EUROS (6 euros) each, all
belonging to a single class and series, fully subscribed for and paid up, which grant
identical voting, information and financial rights to their holders. There are no
restrictions or preference between them.
There are no securities representing benefits attributed to founders and promoters,
nor shares with special benefits.
21.2.4 A description of what action is necessary to change the rights of holders of the
shares, indicating whether conditions are more significant than is required by
law.
There are no provisions in the Articles of Association or in the regulation of
corporate governance of PESCANOVA which impose restrictions or requirements
in addition to those laid down by the Companies Act, and the Securities Market
Act, as the case may be, in order to change or modify the rights of shareholders,
without prejudice to the requirement of a minimum of one hundred (100) shares as
a requirement to attend the General Meeting and establishment in Article 27 of the
Articles of Association of a special quorum of 50% of subscribed capital with
voting rights in order for the General Meeting to be validly constituted on first call
(compared with 25% of subscribed capital with voting rights laid down in Section
193.1 of the Companies Act).
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162
Quorum for constitution of the Shareholders General Meeting (Articles of
Association of the Company):
ARTICLE 27.
CONSTITUTION OF THE GENERAL MEETING. NORMAL QUORUM:
The Shareholders General Meeting, whether ordinary or extraordinary, will be
deemed to be validly constituted on first call when shareholders present in person
or by proxy hold at least 50% of subscribed capital with voting rights. On second
call the General Meeting will be legally constituted whatever the capital present.
The majorities required to pass resolutions are regulated in Article 28 of the
Articles of Association, the wording of which coincides with the contents of
Section 1 of the Companies Act, and therefore no special majorities are required
in order to pass resolutions.
ARTICLE 28.
CONSTITUTION OF THE GENERAL MEETING. SPECIAL QUORUM:
In order that the ordinary or extraordinary General Meeting can validly resolve
on the issue of debentures, an increase or reduction in capital, transformation,
merger or demerger of the Company, and any modification in general of the
Articles of Association, the attendance shall be necessary on first call of
shareholders in person or by proxy holding at least 50% of subscribed capital
with voting rights.
On second call the attendance of 25% of the said capital shall be sufficient.
When shareholders attend representing less than 50% of subscribed capital with
voting rights, the resolutions referred to in the previous sub-article may only be
validly passed with votes in favour by two thirds of capital present in person or
by proxy at the Meeting.
Right of attendance at the Shareholders General Meeting (Articles of
Association and General Meeting Regulations):
ARTICLE 25. (ARTICLES OF ASSOCIATION)
RIGHT OF ATTENDANCE:
All those persons holding one hundred (100) or more shares may attend
Shareholders General Meetings.
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163
In order to exercise the right to attend and vote shares may be grouped, but not
split, such that all shares belonging to the same shareholder must have a single
representative.
ARTICLE 9. (GENERAL MEETING REGULATIONS)
RIGHT OF ATTENDANCE:
In order to attend General Meetings shareholders must hold one hundred (100) or
more shares, and they must be registered in their name in the respective registers
at least five days prior to that on which the General Meeting is to be held.
Shareholders holding a lesser number than that indicated in the previous subarticle may combine them, granting their representation to one of the combined
shareholders or be represented at the General Meeting by another shareholder
who is entitled to attend, thereby grouping the shares of the former with those of
the latter. A single shareholder may not split the shares held by the same and
appoint more than one representative, and therefore may only have a single
representative.
21.2.5. A description of the conditions governing the manner in which annual general
meetings and extraordinary general meetings of shareholders are called,
including the conditions of admission.
In accordance with the Articles of Association and the Shareholders General
Meeting Regulations (which were approved at the meeting held on 20 April 2004
and Article 5 thereof modified at that held on 28 April 2006) of PESCANOVA, the
conditions governing the manner of convening Shareholders General Meetings and
the conditions for admission are as follows:
•
General Meetings must be formally convened by the Board of Directors of the
Company or person to whom such power is delegated, as the case may be.
•
The Board of Directors may convene the General Meeting whenever it
considers it appropriate or desirable in the interests of the Company.
•
The Board of Directors shall be obliged to convene the General Meeting in
the cases laid down by law.
•
The provisions shall apply of the Capital Companies Act in the case of Full
General Meetings of all shareholders.
•
The General Meeting must be convened by announcement published in the
Commercial Registry Official Gazette and in one newspaper of major
circulation it the province of the registered office of the Company, at least one
month prior the date established for holding it, except in the cases in which
the law establishes a different period, for which the provisions thereof shall
apply.
•
The announcement shall set out the date of the meeting on first call and
clearly and concisely determine all matters to be dealt with. The date may
Share Registration Document
164
also be recorded on which, if appropriate, the General Meeting shall be held
on second call. A period of at least 24 hours must elapse between the meeting
on first and second call.
•
Any shareholder may attend the General Meeting who holds one hundred
(100) or more shares, and which are registered in the name thereof in the
respective register at least five days prior to that on which the General
Meeting is to be held, by accreditation through the corresponding attendance
card or certificate issued by any authorised entity or in any other manner
allowed by current legislation.
•
All shareholders entitled to attend may be represented at the General Meeting
by another person, provided that the same is a shareholder, unless the
representative is the spouse, ascendant or descendant of the person
represented and when the former holds a general power of attorney granted by
notarised public document with powers to administer the assets of the person
represented in national territory. Proxies shall be granted in writing and
signed on a special basis for each General Meeting and shall always be
revocable. The provisions of the Articles of Association shall apply to grant
of proxies by remote means of communication.
•
The Company shall on its website publish the documents relating to ordinary
and extraordinary General Meetings with information regarding the agenda
and proposals for resolution to be submitted to the General Meeting.
Furthermore, the information made available to shareholders at the registered
office of the Company shall be included on the website of the Company.
21.2.6. A brief description of any provision of the issuer’s articles of association or
internal regulations that would have an effect of delaying, deferring or
preventing a change in control of the issuer.
Neither the Articles of Association nor any internal provision of the ISSUER
contains any provision which has the effect of delaying, deferring or preventing a
change in control thereof.
21.2.7. An indication of the articles of association or internal regulations, if any,
governing the ownership threshold above which shareholder ownership must
be disclosed.
There is no provision which regulates the procedure for giving notice of the
identity of major shareholders, and the Company is governed by the provisions of
Royal Decree 1362/2007, of 19 October, regulating the notification of significant
holdings in listed companies and acquisition by them of their own shares.
21.2.8. A description of the conditions imposed by the articles of association or
internal regulations which govern changes in capital, where such conditions
are more stringent than is required by law.
In order to determine the conditions which govern changes in the capital of the
Company, PESCANOVA, S.A. abides by the provisions of the law.
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165
22. MATERIAL CONTRACTS
Apart from the contracts inherent in ordinary business it is not considered that there
are others worthy of mention, after completion of the corresponding investments
made in 2009 which were related to the investment in the plant at Mira, Portugal, for
turbot production.
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166
23. THIRD PARTY INFORMATION AND STATEMENTS BY EXPERTS AND
DECLARATIONS OF ANY INTEREST
23.1 Where a statement or report attributed to a person as an expert is included in
the registration document, provide such person’s name, business address,
qualifications and material interest, if any, in the issuer. If the report has been
produced at the issuer’s request, a statement to the effect that such statement or
report is included, the form and context in which it is included, with the consent
of the person who has authorised the contents of that part of the registration
document.
This Document does not include statements or reports attributed to persons in their
capacity as experts.
23.2 Where information has been sourced from a third party, provide a confirmation
that this information has been accurately reproduced and that as far as the
issuer is aware and is able to ascertain from information published by that third
party, no facts have been omitted which would render the reproduced
information inaccurate or misleading. In addition, identify the source(s) of the
information.
Not applicable.
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167
24. DOCUMENTS FOR CONSULTATION
During the period of validity of the Information regarding the ISSUER of this
Document, the following documents can be inspected in the locations indicated
below:
o The Articles of Association, Regulations of the Shareholders General
Meeting, Regulations of the Board of Directors and Internal Conduct
Regulations in matters relating to the securities market, are available to the
public and can be consulted at the registered office, at Rúa de José Fernández
López s/n, Chapela, Redondela, Pontevedra, or through the website of the
Company (www.pescanova.com).
o The Articles of Association of the Company can also be consulted in the
Commercial Registry.
o The historical financial information of PESCANOVA, consisting of the
audited individual and consolidated annual financial statements for the
financial years ending 31 December 2009, 2010 and 2011, are available to the
public and can be consulted at the registered office of the Company, at Rúa de
José Fernández López s/n, Chapela, Redondela, Pontevedra, through the
website of the Company (www.pescanova.com) and on the website of the
CNMV (Spanish Securities Market Commission) (www.cnmv.es) and in
relation to the said individual and consolidated annual financial statements,
also at the Pontevedra Commercial Registry.
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168
25. INFORMATION ON HOLDINGS
Section 7.1 of this Document includes information regarding details of subsidiaries and
associated companies of the PESCANOVA Group at the date of this Document.
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169
SHARE SECURITIES NOTE RELATING TO THE
CAPITAL INCREASE OF PESCANOVA
(ANNEX III OF COMMISSION REGULATION (EC) No. 809/2004 OF 29
ABRIL 2004 AND ANNEX XXII OF COMMISSION DELEGATED
REGULATION (EU) No. 486/2012 OF 30 MARCH 2012
This Share Securities Note was registered in the records of the Spanish Securities Market Commission
(Comisión Nacional del Mercado de Valores) on 10 July 2012.
This Share Securities Note is complemented by the Share Registration Document (Annex I of
Commission Regulation (EC) 809/2004 of 29 April 2004) registered in the records of the Spanish
Securities Market Commission on 26 June 2012, which is incorporated by reference.
CONTENTS
SHARE SECURITIES NOTE RELATING TO THE CAPITAL
INCREASE OF PESCANOVA (Annex III of Commission Regulation (EC)
No 809/2004 of 29 April 2004 and Annex XXII of Delegated Regulation
(EU) No 486/2012 of the Commission of 30 March 2012)
I.
SUMMARY
SECTION A – INTRODUCTION AND WARNINGS
SECTION B – ISSUER
SECTION C – SECURITIES
SECTION D – RISKS
SECTION E - OFFER
II.
0.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
Contents
INFORMATION ON THE SECURITIES OF THE CAPITAL
INCREASE
RISK FACTORS
PERSONS RESPONSIBLE
RISK FACTORS
KEY INFORMATION
INFORMATION CONCERNING THE SECURITIES TO BE OFFERED/ADMITTED TO
TRADING
TERMS AND CONDITIONS OF THE CAPITAL INCREASE
ADMISSION TO TRADING AND DEALING ARRANGEMENTS
SELLER HOLDERS OF SECURITIES
EXPENSES OF THE CAPITAL INCREASE
DILUTION
ADDITIONAL INFORMATION
UPDATE OF THE REGISTRATION DOCUMENT
1
I.
SUMMARY
Summaries are made up of disclosure requirements known as ‘Elements’. These
elements are numbered in Sections A – E (A.1 – E.7).
This summary contains all the Elements required to be included in a summary for this
type of securities and Issuer. Because some Elements are not required to be addressed,
there may be gaps in the numbering sequence of the Elements.
Even though an Element may be required to be inserted in the summary because of the
type of securities and Issuer, it is possible that no relevant information can be given
regarding the Element. In this case a short description of the Element is included in the
summary with the mention of ‘not applicable’.
Where information is not included in the body of a prospectus in relation to a particular
Element, a reference to ‘not applicable’ should appear followed by a short description of
the disclosure requirement. ‘Not applicable’ should not be abbreviated to ‘N/A’.
Section A — Introduction and warnings
A.1
•
This Summary should be read as introduction to the Prospectus (which comprises the Registration Document of
PESCANOVA, S.A. –“PESCANOVA” or the “COMPANY”– and the Share Securities Note registered in the official
records of the Spanish Securities Market Commission (CNMV) on 26 June and 10 July 2012, respectively).
•
Any decision to invest in the securities should be based on consideration of the Prospectus as a whole by the investor.
•
When a claim relating to the information contained in the Prospectus is brought before a court, the plaintiff investor
might under the national legislation of the Member States have to bear the costs of translating the prospectus before the
legal proceedings are initiated.
Civil liability attaches only to those persons who have tabled the summary including any translation thereof, but only if
the summary is misleading, inaccurate or inconsistent when read together with the other parts of the Prospectus or it
does not provide, when read together with the other parts of the Prospectus, key information in order to aid investors
when considering whether to invest in such securities.
•
Section B — Issuer
B.1
B.2
B.3
The legal and
commercial name
of the issuer.
The domicile and
legal form of the
issuer, the
legislation under
which the issuer
operates and its
country of
incorporation.
A description of,
and key factors
relating to, the
nature of the
issuer’s current
operations and its
principal
activities, stating
the main
categories of
products sold
and/or services
performed and
identification of
the principal
markets in which
Summary
The name of the COMPANY is PESCANOVA, S.A., which operates under the commercial name of
“PESCANOVA”.
The COMPANY was incorporated in Spain and has its registered office at calle José Fernández
López s/n, 36320, Chapela-Redondela (Pontevedra).
PESCANOVA has the legal form of a “sociedad anónima” (joint stock company) and is governed by
Spanish law. Its Tax ID Number is A-36603587.
The corporate purpose of PESCANOVA are “The industrial operation of all activities connected
with products destined for human or animal consumption, including their production,
transformation, distribution, commercialisation and other complementary activities or those deriving
from the principal activity, both of an industrial and commercial nature, as well as participation in
national or foreign undertakings”.
The key factors relating to the nature of current operations of PESCANOVA particularly include the
following:
•
Implementation of a vertical integration model geared to being able to supply a wide range of
products in order to maintain the global margins which are generated during the different
processes within the group of companies of which PESCANOVA is ultimate parent (the
“PESCANOVA Group”).
•
Pursuing a strategy of diversification which enables market requirements to be met, avoiding loss
of positioning in certain circumstances of product shortage. Diversification is linked to the type
2
Section B — Issuer
of activity which is very sensitive to certain factors such as conditions of fishing grounds, bioclimatic conditions, health factors, consumer tastes, etc.
the issuer
competes.
• Strengthening investments in the field of aquaculture due to its high technological component.
The products of PESCANOVA could be classified on the basis of the following categories:
•
Fishing or extraction activity: comprises activities connected with the capture in natural fishing
grounds, i.e. fish and preparation of frozen products. The strategy of PESCANOVA in this
segment centres on developing a broad range of undertakings with local partners in countries
with abundant fishing resources in order to facilitate obtaining the necessary conditions to
operate the fishing grounds from local governments. In this manner fishing rights of the
PESCANOVA Group have a high strategic value. This range of activities particularly includes
product preparation through freezer vessels.
•
Aquaculture, or fish farming activities: focus on development of technique for reproduction of
species in fresh and salt water as alternative to the shortage of natural sources, maintaining
positioning in the sector.
•
Transformation activities: PESCANOVA engages in transformation activities in its fishing
vessels and in industrial plants on land.
• Distribution and commercialisation activities
The principal markets in which PESCANOVA competes are Spain (48% of sales), USA (13%),
France (10%), Italy (6%), Portugal (5%), Japan (5%), and the rest of the European Union (3%), with
the remaining 10% in other countries.
B.4a
A description of
the most
significant recent
trends affecting
the issuer and the
industries in which
it operates.
Trends which affect PESCANOVA
The most significant recent event is the resolution of the Board of Directors of PESCANOVA of 22
June 2012 where it was approved the admission to trading on the Santiago de Chile Stock Exchange
of Acuinova Chile, S.A., the head of its salmon aquaculture activities, which will take place through
an initial public offering of shares.
Trends which affect the sectors in which PESCANOVA operates
The following can be highlighted: (i) modification of source of aquaculture products, which tend for
the most part to be of own production, replacing products purchased from third parties and without
any preparatory processing, (ii) consolidation of sales in emerging markets such as Brazil, China,
México and Russia, and (iii) maturity of the aquaculture projects, particularly salmon and vannamei
prawn.
B.5
B.6
If the issuer is part
of a group, a
description of the
group and the
issuer’s position
within the group.
Insofar as it is
known to the
issuer, the name of
any person who,
directly or
indirectly, has an
interest in the
issuer’s capital or
voting rights
which is notifiable
under the issuer’s
national law,
together with the
amount of each
such person’s
interest.
Summary
PESCANOVA is the ultimate parent company of an industrial group (the PESCANOVA Group)
present in Europe, Asia, the Americas and Africa, the activities of which are indicated in the previous
Element B.3. PESCANOVA does not in turn form part of any other group of companies.
According to the most recent available public information, the principal shareholders of
PESCANOVA and their percentage holding in capital are as follows:
Board member Shareholders (voting rights)
Name
Mr. Manuel Fernández de Sousa-Faro
Luxempart, S.A.
Mr. Alfonso Paz-Andrade Rodríguez
Liquidambar Inversiones Financieras, S.L
Mr. Antonio Basagoiti García Tuñón
Mr. José Carceller Arce
Mr. Robert Albert Williams
Inverlema, S.L.
TOTAL
No director holds PESCANOVA stock options.
Direct
18,073
1,000,000
2,631
975,000
1,100
1,000
221
1
2,037,446
Indirect
4,323,023(1)
–
992,120(2)
–
–
–
–
–
5,275,723
Total
4,341,096
1,000,000
994,751
975,000
1,100
1,000
221
1
7,313,169
% of total voting rights
22.322%
5.142%
5.116%
5.014%
0.006%
0.005%
0.001%
0.000%
37.607%
Through: (1) Sociedad Anónima de Desarrollo y Control (SODESCO) (14.823%), INVERPESCA, S.A. (7.204%) and Sociedad Gallega de Importación
de Carbones, S.A. (GICSA) (0.203%), the latter company which is in turn director of PESCANOVA (2) Nova Ardara Equities, S.A. (5.097%), SIPSA
(0.004) and IBERCISA (0.001).
Non-board member significant shareholders (voting rights)
Name
Direct
Indirect
Total
% of total voting rights
Governance for Owners Llp (1)
–
986,827
986,827
5.074%
(2)
Mr. Jose Antonio Pérez-Nievas Heredero
–
974,307
974,307
5.010%
Sociedad Anónima Damm (3)
–
972,366
972,366
5.000%
Mr. José Alberto Barreras Barreras (4)
–
748,100
748,100
3.847%
TOTAL
–
3,681,600
3,681,600
18.931%
The holding of Nova Ardara Equities, S.A. and of SODESCO are not included since they are included as indirect holders of the Board, whose holders
are Mr. Alfonso Paz-Andrade and Mr. Manuel Fernández de Sousa-Faro.
Through: (1) Governance for Owners European Focus Found; (2) Golden Limit, S.L. Jose Antonio Pérez-Nievas Heredero is in turn individual
representative of the designated director Iberfomento, S.A., (3) Corporación Económica Damm, S.A., (4) Transpesca, S.A. Mr. José Alberto Barreras
3
Section B — Issuer
Barreras is in turn the father of the designated director Ms. Ana Belén Barreras Ruano.
B.7
Selected historical
key financial
information
regarding the
issuer, presented
for each financial
year of the period
covered by the
historical financial
information, and
any subsequent
interim financial
period
accompanied by
comparative date
from the same
period in the prior
financial year,
except that the
requirement for
comparative
balance sheet
information is
satisfied by
presenting the
year-end balance
sheet information.
The financial information presented below relates to data on activities of the PESCANOVA Group at
31 December in the financial years 2011, 2010 and 2009, based on the audited consolidated annual
financial statements, prepared in accordance with international financial information standards
adopted by the European Union, in accordance with Regulation (EC) no. 1606/2002 of the European
Parliament and Council (“FIRS”). An extract is shown below of the principal items from these
annual financial statements:
Consolidated balance sheet (thousands of euros)
Non-current assets
Current assets
TOTAL ASSETS
Net equity
Non-current liabilities
Current liabilities
TOTAL LIABILITIES + NET EQUITY
Working capital
2011
2010
2009
1,120,143
1,156,338
2,276,481
531,890
924,275
820,316
2,276,481
336,022
1,123,169
1,066,973
2,190,142
477,166
810,950
902,026
2,190,142
164,947
1,129,682
948,592
2,078,274
444,459
642,647
991,168
2,078,274
-42,576
% Variation 1110
0%
8%
4%
11%
14%
-9%
4%
104%
% Variation 10-09
-1%
12%
5%
7%
26%
-9%
5%
487%
Consolidated income statement (thousands of euros)
Operating income
Operating expenses
EBITDA
CONSOLIDATED OPERATING PROFIT
Financial income
Financial expenses
FINANCIAL RESULTS
OTHER RESULTS
CONSOLIDATED PRE-TAX PROFIT
Tax on profit
Consolidated profit from continuing activities
Net profit from discontinued operations
CONSOLIDATED PROFIT FOR YEAR
Attributable to:
Outside shareholders
Parent company
2011
2010
2009
1,701,821
1,579,966
183,526
121,855
2,604
55,397
-52,793
-4,286
64,776
-13,174
51,602
-1,181
50,421
1,609,397
1,502,931
163,349
106,466
294
53,507
-53,213
-3,569
49,684
-11,293
38,391
-1,531
36,860
1,496,126
1,394,439
149,709
101,687
499
54,338
-53,889
-2,294
45,504
-8,412
37,092
-4,508
32,584
% Variation 1110
5.74%
5.13%
12.35%
14.45%
785.71%
3.53%
-0.79%
20.09%
30.38%
16.66%
34.41%
-22.86%
36.79%
281
50,140
563
36,297
493
32,091
-50.09%
38.14%
2010
2009
% Variation 10-09
7.57%
7.78%
9.11%
4.70%
-41.08%
-1.62%
-1.25%
55.58%
9.19%
34.25%
3.50%
-100%
13.12%
14.20%
13.11%
Principal financial ratios
2011
% Variation 11-10
% Variation 10-09
183,526
163,349
149,709
12.35%
9.11%
Gross Operating Profit EBITDA (*)
688,168
540,768
545,144
27.26%
-0.80%
Net Financial Debt (**)
818,291
662,984
649,950
23.43%
2.01%
Total Net Financial Debt
Return on Equity
9.48%
7.72%
7.33%
22.72%
5.37%
(ROE = Gross Profit/Net Equity)
30.23%
24.69%
26.23%
22.43%
-5.87%
Financial Gearing (Net Debt/Assets)
3.8
3.31
3.64
14.79%
-9.09%
Net Financial Debt / EBITDA
4.46
4.06
4.34
9.86%
-6.51%
Total Net Financial Debt / EBITDA
336,022
164,947
-42,576
103.72%
487.42%
Working Capital
10.99%
10.44%
10.16%
5.23%
2.71%
EBITDA/ Turnover
(*) EBITDA represents the profit and loss of the COMPANY before tax, interest and depreciation and coincides with operating profit plus depreciation.
(**) Net financial debt includes exclusively financial debt with recourse.
Selected consolidated financial information is included below of the PESCANOVA Group, which
has not been the subject of audit or limited review, relating to the first quarter of 2012 with a
comparative column at 31 December 2011, in relation to the balance sheet, and to the same period in
the financial year with respect to the income statement. No significant changes have occurred in the
financial position of the PESCANOVA Group since 31 March 2012.
Consolidated balance sheet (thousands of euros)
Non-current assets
Current assets
Total Assets
Net equity
Non-current liabilities
Current liabilities
Total Liabilities + Net Equity
31/03/2012
31/12/2011
% Variation
1,118,793
1,113,680
2,232,473
525,245
911,849
795,379
2,232,473
1,120,143
1,156,338
2,276,481
531,890
924,275
820,316
2,276,481
-0.12%
-3.69%
-1.93%
-1.25%
-1.34%
-3.04%
-1.93%
31/03/2012
31/03/2011
% Variation
350,960
38,318
23,238
9,042
329,571
34,280
20,388
8,553
6.49%
11.78%
13.98%
5.72%
Consolidated income statement (thousands of euros)
Consolidated turnover
EBITDA
EBIT
Profit before tax
Summary
4
Section B — Issuer
Principal financial ratios
31/03/2012
31/12/2011
% Variation
187,564
183.526
2.20%
Gross Operating Profit EBITDA (*)
709,557
688.168
3.11%
Net Financial Debt (**)
832,387
818.291
1.72%
Total Net Financial Debt
31.78%
30.23%
Financial Gearing (Net Debt/Assets)
3.78
3.75
Net Financial Debt / EBITDA
4.44
4.46
Total Net Financial Debt / EBITDA
318,301
336.022
-5.27%
Working capital
11.08%
10.99%
EBITDA/ Turnover
(*) EBITDA represents the profit and loss of the COMPANY before tax, interest and depreciation and coincides with operating profit plus depreciation.
(**) Net financial debt includes exclusively financial debt with recourse.
B.8
B.9
B.10
B.11
Selected key pro
forma financial
information,
identified as such.
Not applicable. No significant changes have occurred in the financial situation of the COMPANY
nor will occur as a result of the capital increase described in the following Section E (the “Capital
Increase”), which require the preparation of pro rata financial information in accordance with
applicable legislation.
Where a profit
forecast or
estimate is made,
state the figure.
A description of
the nature of any
qualifications in
the audit report on
the historical
financial
information.
If the issuer’s
working capital is
not sufficient for
the issuer’s
present
requirements, an
explanation should
be included.
PESCANOVA has elected not to include a profit estimate.
The audit reports issued in respect of the individual annual financial statements of PESCANOVA and
of its consolidated group for the 2011, 2010 and 2009 financial years contain separate favourable
opinions without qualifications.
Not applicable, since working capital is sufficient for the current requirements of the Issuer.
Section C — Securities
C.1
C.2
C.3
C.4
A description of
the type and the
class of the
securities being
offered and/or
admitted to
trading,
including any
security
identification
number.
Currency of the
securities issued.
The number of
shares issued
and fully paid
and issued but
not fully paid.
The par value
per share, or
that the shares
have no par
value.
A description of
the rights
attached to the
securities.
Summary
The shares which are offered (the “New Shares”) are ordinary shares of PESCANOVA with a nominal
value of 6 euros each, of the same class and series as those in existence and will grant their holders the
same rights as those currently in circulation.
The ISIN Code of the shares of the COMPANY currently in circulation is ES0169350016. The New
Shares will be assigned a provisional different ISIN Code until this code is made equivalent with that of
the current shares.
The shares of the COMPANY are referred to in euros.
The share capital of PESCANOVA prior to the Capital Increase is divided into 19,447,254 shares with
a nominal value of 6 euros each, fully paid up.
•
Right to participate in dividends which it is resolved to distribute to PESCANOVA shareholders as
from the time when the Capital Increase is declared subscribed for and paid up (hereinafter the
“Transaction Date”, which is expected to take place on 7 August 2012).
•
Information right, as set out in Sections 93.d), 297 and 527 of Royal Legislative Decree 1/2010, of
5
Section C — Securities
2 July, enacting the Revised Text of the Capital Companies Act (the “Capital Companies Act”)
and the rights which, as special aspects of information rights, are contained in the said Capital
Companies Act and in Act 3/2009, of 3 April, on structural modifications of commercial
companies.
C.5
C.6
C.7
A description of
any restrictions
on the free
transferability
of the securities.
An indication as
to whether the
securities
offered are or
will be the
object of an
application for
admission to
trading on a
regulated
market and the
identity of all
the regulated
markets where
the securities
are or are to be
traded.
A description of
dividend policy.
•
Rights of attendance and voting at Shareholders General Meetings and to challenge corporate
resolutions in accordance with the general regime established by the Capital Companies Act and
the Articles of Association of PESCANOVA.
•
Preferential subscription right on issues of new ordinary or preference shares by contributions in
cash, or of bonds convertible into shares, without prejudice to the possibility of exclusion of this
right.
•
Right of free allotment of shares on capital increases charged to reserves.
•
Right to participate in any surplus in the event of liquidation of the COMPANY in proportion to
the nominal value of the shares held by each shareholder.
•
Right of separation in accordance with the provisions of Sections 346 and 468 of the Capital
Companies Act.
There are no restrictions on the free transferability of the COMPANY’s shares.
It is expected that the New Shares will be admitted to trading on the Madrid and Bilbao Stock
Exchanges and included in the Stock Exchange Interconnection System (Continuous Market) on a date
which is estimated will not be after 15 August 2012.
The COMPANY does not have a specific policy with respect to dividend distribution. The total amount
distributed by way of dividends represented 61%, 63% and 66% of the individual net profit of
PESCANOVA in the years 2009, 2010 and 2011, respectively (26.86%, 26.38% and 21.21% of
consolidated net profit).
Section D — Risks
D.1
Key information
on the key risks
that are specific
to the issuer or
its industry.
Summary
Risk factors specific to the issuer
Risks deriving from level of debt.
Although the PESCANOVA Group can meet its current level of debt, as explained in Section 3 of
this Registration Document, reasons may exist such as reductions in profits, investment
requirements or acquisitions of other businesses as well as increased financing or cash
requirements which could give rise to the need for an increase in debt of the PESCANOVA Group.
In this respect, consideration must further be given to the current context of difficulty in obtaining
or improving financing as a result of the economic situation of the banking-financial sector. On 31
March 2012 total net financial debt amounted to 832 million euros, with the ratio to EBITDA being
4.4. The average interest rate on debt with credit institutions was 7.03%. 75% of the debt to
financial institutions was subject to variable interest rates.
The three bond issues made in 2010, 2011 and 2012, in force at the present time, were subscribed
for at market interest rates current at each time, and in all cases the rates achieved were the best
possible given the current market conditions.
At the present date the PESCANOVA Group is not in a situation of default of its financial
obligations or of any type of obligation which could give rise to a situation of early maturity of its
financial commitments.
In the event of breach of its financial obligations, lenders could demand early payment of the
6
Section D — Risks
principal amount of the debt and interest. The capacity of the PESCANOVA Group to comply with
financial covenants, meet indebtedness or be able to refinance it if necessary, is conditioned by
obtaining business results and by other economic factors and factors of the sector in which the
PESCANOVA Group operates.
Risks deriving from impairment in value of goodwill.
Goodwill is recognised at cost, 70.8 million euros at 31 March 2012, meaning the excess of the
cost of the combination of businesses over the holding of the parent company in the reasonable net
value of the assets, liabilities and identifiable contingent liabilities acquired. Although goodwill is
not depreciated, its recoverable value is reviewed at least once each year, or within a lesser period
if there is an indication of loss of value. For these purposes, calculations of recoverable value are
adjusted to reasonable value and are based on cash flow projections of the cash generating units
assigned to the goodwill. In this review, hypotheses are taken relating to future operations, profit
and loss and market situation, which involves the use of estimates of sales, margins, percentage
growth and discount rates. Since these hypotheses are subjective, uncertainties exist and the
possibility of events occurring which could give rise to the need to reflect losses in the book value
of goodwill, which could negatively affect results for the period and the financial ratios.
Interest rate risk
Variations in interest rates modify the reasonable value of those assets and liabilities which accrue
a fixed interest rate as well as future flows from assets and liabilities referenced to a variable
interest rate, basically affecting financial debt.
The objective of interest rate risk management is to achieve a balance in the debt structure which
permits the cost of debt to be minimised over a multi-year horizon with reduced volatility in the
profit and loss account.
Depending on Group estimates and the objectives of the debt structure, hedging operations may be
carried out by contracting derivatives which mitigate these risks. The sensitivity analysis carried
out by the PESCANOVA Group with respect to the interest rate to which it is exposed is detailed
below:
Description
Variation in interest rate of 50 basis points
31/03/2012
P&L
Equity
± 5%
± 0.5%
P&L
± 5%
31/03/2011
Equity
± 0.5%
The reference interest rate of the debt contracted by the PESCANOVA Group is basically the
EURIBOR.
Exchange rate risk.
Exchange rate risks at 31.03.2012 basically relate to the following transactions:
•
Debts in foreign currency in accordance with the currency rates in which they are contracted
amount to 197.3 million euros of which 172.8 million correspond to debts in US dollars and
the remaining 24.5 to various debts in yen, meticais, Namibian dollars and Australian dollars.
•
Debt denominated in foreign currency contracted by Group and associated companies (18.4%
in US Dollars and the remainder, approximately 2.8%, in various currencies in different
countries in which the PESCANOVA Group operates).
•
Payments to be made in countries outside the Euro Zone as a result of acquiring services of all
types. Payment obligations in currencies other than the euro are approximately 29% of the
total.
In addition, net assets deriving from net investments made in foreign companies with a functional
currency other than the euro (105 million euros) are subject to exchange rate fluctuation risk on
conversion of the financial statements of these companies in the consolidation process.
In order to mitigate the exchange rate risk, the PESCANOVA Group attempts to bring about a
balance between receipts and payments in cash of its assets and liabilities denominated in foreign
currency.
The sensitivity analysis carried with respect to the exchange rates to which the PESCANOVA
Group is exposed is as follows:
31/03/2012
Description
Variation in the quotation of currencies with respect to
the euro of 5%
P&L
Equity
P&L
± 1%
± 0.1%
± 1%
31/03/2011
Net Equity
± 0.1%
Liquidity Risk.
The Group maintains a consistent liquidity policy consisting of contracting committed credit
facilities and temporary investments in sufficient amount to meet forecast needs for a period based
on the situation and expectations of debt and capital markets.
The general situation of financial markets, particularly the banking market, during recent months
has been particularly unfavourable to credit seekers. The COMPANY pays permanent attention to
evolution of the different factors which can assist in the future in overcoming possible liquidity
Summary
7
Section D — Risks
crises, and in particular to sources of financing and their characteristics.
The following are pillars or reference points of liquidity Risk Management:
•
Liquidity of monetary assets: surpluses are always placed for very short periods.
Placements for periods exceeding three months require express authorisation.
•
Diversification of credit line maturities and monitoring of financing and refinancing.
•
Monitoring of the remaining life of financing lines.
•
Diversification of sources of financing.
Credit risk.
The principal financial assets of the Group are cash and bank balances, trade debtors and other
accounts receivable, and investments, which represent the maximum exposure of the Group to
credit risk in relation to financial assets.
The credit risk of the Group is principally attributable to its trade debts. Amounts are shown in the
Balance Sheet net of provisions for bad debts, estimated by Group Management based on
experience in previous years and its assessment of the current economic environment.
The Group does not have a significant concentration of credit risk, with the largest debtor not
exceeding 5% of turnover, with exposure distributed among a large number of counterparties and
customers. Furthermore, historic bad debts can be classified as very low (historically they do not
reach 0.5%), and this has not changed significantly despite the current economic climate.
Risk factors of the issuer’s sector of activity
Risks of the general economic situation, consumption and distribution channels.
The PESCANOVA Group is subject to some of the trends which are taking place in the national
and international market in general and in the foodstuffs sector in particular:
•
Slow-down in consumption combined with a growing move by part of consumption
towards distribution or white brands and the cheaper product categories. Thus, according
to studies by the TNS agency of the foodstuffs sector in Spain, white brands between
1993 and 2011 have grown from representing approximately 10% to 35% of the sector
total by value. The data which has been revealed in the media in recent months points to
the growth trend continuing, encouraged by the current economic situation. This also
leads to an increase in barriers to the introduction of new references in distribution
channels, due to the existence of fewer consumers prepared to spend beyond what is
strictly necessary and known.
•
Increase, on the one hand, in distributor concentration operations, which increases their
bargaining power with supplier companies, and, on the other hand, insolvencies of small
and medium-sized distribution businesses, in this case leading to an increase in bad debts.
•
Global increase in prices (fish, energy and transport) which gives rise to a widespread
increase in the costs of the PESCANOVA Group (see also following section on impact
on raw materials and animal food).
•
The impact of the contraction in purchasing expenditure is more negative in products of
higher retail price in absolute terms, which affects some Group products.
Although the strategy of the PESCANOVA Group is geared to compensating for these trends in the
market and also taking advantage of some of them, it cannot be guaranteed that they will not have a
material effect on the capacity of the PESCANOVA Group to increase its sales and margins.
Risks deriving from the effects of oscillations in fish prices.
The price of fish raw materials, which represents the largest component of the cost of products on
sale, is volatile and in some cases cyclical (much historical variation). The volatility is determined
by diverse factors over which the PESCANOVA Group has no or only partial control, such as
climatic and weather changes, pathologies of fish farmed, restrictions on import and export, use of
cereals in biofuels, energy prices and impact on transport costs, etc.
Furthermore, and based on the specific characteristics of the markets in each country, the capacity
which operators may have to pass on increases or falls in the price of fish to the market varies
between the different countries in which the PESCANOVA Group is present. This is also
influenced by competition from products other than fish (meat or others) of protein content which
can substitute for fish products in the event of price fluctuations.
Risks deriving from the existence of situations which affect foodstuffs safety which can have a
negative impact on PESCANOVA.
As a result of the sector in which the PESCANOVA Group operates, it is subject to the general
risks associated with health and welfare of consumers, both real and those which can be caused by
perceptions of consumers themselves. These risks include evolution of consumer preferences,
nutritional concerns, the effect of adverse publicity, liability claims by consumers, damage or
Summary
8
Section D — Risks
contamination in products, more restrictive legislation, etc. Likewise, the potential for sale of
products could be affected by the actions of other companies operating in the same sector if they
cause a general loss of confidence amongst consumers.
The PESCANOVA Group is subject in its production plants to numerous regulations relating to the
foodstuffs safety field, including constant inspections both by authorities from different countries
and internally through its quality department, present in all production activities. In addition, within
the production process itself monitoring and control systems are applied at all stages, in order to
reduce and avoid the risks of foodstuffs safety. To this must be added the regular training of plant
personnel and, with respect to the companies making up the PESCANOVA Group, the
establishment of rigorous standards aligned to ISO 9001 standards which are certified by the
Spanish Association of Standardisation and Certification (Asociación Española de Normalización y
Certificación - (AENOR). Furthermore, it must be emphasised that plants of the PESCANOVA
Group in virtually all countries in which it operates comply with ISO 9001 Standards regarding
Quality systems, ISO 14000 Standards on the environment and other specific Standards in certain
countries such as HACCP, BRC ISO 22000 in Ecuador, and PAC (AI) and (A2) IFS in Chile,
amongst others. Nevertheless, the existence cannot be prevented of a risk factor in those products
resulting from human error despite all control elements. It must further be considered that this can
occur after the production stage as a result of unsuitable handling by a distributor or the consumer
himself.
PESCANOVA products are destined for human consumption. If, despite the multiple controls
which the PESCANOVA Group establishes, they do not reach the consumer in optimum condition,
situations may occur which are the cause of administrative, civil and even criminal liability to
PESCANOVA as well as reputational loss.
These events could give rise to the reputation, business, profit and loss, prospects and financial,
economic or equity situation of PESCANOVA being negatively affected.
Risks deriving from the effect of specific regulation concerning the environmental sector on the
activities of PESCANOVA.
As with all environmental activities, and more specifically those of the foodstuffs industry, the
activities of PESCANOVA are subject to extensive and full environmental regulation in the
countries in which it operates, which includes obtaining various licences and administrative
authorisations to engage in activities. Different administrations (legal, regional, State, Community
and supra-national) have competences in the environmental field.
Non-compliance with environmental legislation, including failure to obtain the requisite licences or
authorisations to engage in activities, can, as the case may be, have negative consequences for
PESCANOVA. In addition, environmental legislation is increasingly stringent, and therefore it
cannot be ruled out, as the case may be, that PESCANOVA has to incur substantial expenditure
and investment in order to comply with new legal requirements or settle new taxes or levies of an
environmental nature.
Hypothetically, this all means that PESCANOVA could need to incur expenditure and investment
or pay penalties in an amount which can be very high, which could negatively affect the business,
profit and loss, prospects and financial, economic or equity situation of PESCANOVA.
Risks deriving from the effect of specific regulation of the foodstuffs industry on the activities of
PESCANOVA.
The activities of PESCANOVA, as with the whole of the foodstuffs industry, are subject to
extensive regulation in the countries in which it operates and distributes its products. The
regulation affects the production process, packaging, storage, distribution, labelling, advertising
and commercialisation of PESCANOVA products.
If, despite the multiple controls established by the PESCANOVA Group, any breach occurs of
applicable legislation, this could have serious consequences for PESCANOVA which could incur
liabilities and it could negatively affect the business, profit and loss, prospects and financial,
economic or equity situation of PESCANOVA.
Summary
9
Section D — Risks
Risks deriving from the effect of specific regulation of the fishery or fish farming sector on the
activities of PESCANOVA.
The activities of PESCANOVA are subject, in Spain, to national and European regulation of the
fishing or fish farming sector, of commercial activity in fisheries products and foreign trade in
them. Furthermore, in the rest of the world the activities of PESCANOVA are subject to the
specific legislation of the countries and territorial waters in which it operates, as also happens in
countries where it farms fish. This legislation seeks to rationalise the exploitation of fishery
resources, fleet management and ensure the viability of certain fish stocks, limiting the annual
amounts to which fleets have access and establish fishing ground regeneration periods.
If, despite the multiple controls established by the PESCANOVA Group, any breach occurs of
applicable regulation, this could have serious consequences for PESCANOVA which could incur
liabilities and it could have a negative effect on the business, profit and loss, prospects and
financial, economic or equity situation of PESCANOVA, S.A.
D.3
Key information
on the key risks
that are specific
to the securities.
Irrevocability of subscription.
The shareholders of PESCANOVA who exercise preferential subscription rights held by them, and
investors who acquire and exercise them, during the Preferential Subscription Period of the
Increase may not revoke subscriptions made in the said period nor applications which they make to
subscribe for additional shares, even if the Underwriting Agreement referred to in the following
Element E.3 is terminated on the grounds laid down therein, or it does not come into force as a
result of failure to fulfil any of the conditions precedent provided in it. As sole exception to the
foregoing, if the Underwriting Agreement is terminated, applications for subscriptions for shares
made during the Discretionary Allotment Period would be automatically revoked.
Consequently, shareholders and those acquiring preferential subscription rights will be obliged to
acquire the shares even if the quotation price in the Continuous Market of the PESCANOVA
shares is below the Subscription Price of the New Shares.
Partial underwriting of the Capital Increase.
The Capital Increase is guaranteed in part in respect of approximately 84% of the New Shares, of
which 20% relate to commitments to subscription assumed to the COMPANY by major
shareholders who are in turn directors of the COMPANY, or who have proposed the appointment of
proprietary directors, and approximately 64% to underwriting commitments assumed by BNP
Paribas and Banco BPI, S.A. in the event that New Shares remain undistributed after the
Discretionary Allotment Period.
Consequently, approximately 16% of the Capital Increase may not be issued in the event that there
is insufficient demand, in which case incomplete subscription of the Capital Increase would be
declared in the cash amount subscribed for, which as previously indicated would be at least
approximately 105 million euros.
Uncertainty regarding development of an active market for the preferential subscription rights.
The preferential subscription rights relating to the Capital Increase covered by this Prospectus will
be negotiable on the Madrid and Bilbao Stock Exchanges through the Stock Exchange
Interconnection System (Continuous Market) during trading sessions which fall within the 15
calendar days following publication of the announcement of the Capital Increase in the
Commercial Registry Official Gazette (Boletín Oficial del Registro Mercantil —BORME—).
PESCANOVA cannot guarantee that an active trading market will develop for the said rights or the
price at which the said rights will be traded.
A possible significant fall in the quotation price of the PESCANOVA shares could negatively affect
the value of the quotation price of the preferential subscription rights.
Since the trading price of the preferential subscription rights depends on the trading price of the
PESCANOVA shares, a possible significant fall in the quotation price of PESCANOVA shares
could negatively affect the value of the preferential subscription rights and therefore this value
could be affected by the same risks as those of the shares of PESCANOVA.
PESCANOVA cannot guarantee to holders of preferential subscription rights that the price of the
PESCANOVA shares will not fall below the subscription price for shares after the holders of
preferential subscription rights have decided to exercise them. If this occurs, the holders of
preferential subscription rights will have committed to acquiring New Shares at a price higher than
that of the market. Furthermore, PESCANOVA cannot guarantee to holders of preferential
Summary
10
Section D — Risks
subscription rights that after exercise of the said rights they can manage to sell their shares at a
price equal to or higher than the Subscription Price.
Those shareholders who do not exercise their preferential subscription rights over the New Shares
will see their holding in the capital of PESCANOVA diluted.
Since, with the Capital Increase, New Ordinary Shares of PESCANOVA will be issued, those
shareholders who do not exercise their preferential subscription rights will experience dilution of
their holding in PESCANOVA by 32.33% of their current holding, in the event that there is
subscription for 100% of the New Shares issued. Furthermore, even in the event that the
shareholder transfers his unexercised preferential subscription rights, the price he receives as
consideration may not be sufficient to compensate him completely for dilution of his holding in the
share capital of PESCANOVA as a result of the Capital Increase. Also, after the Preferential
Subscription Period has elapsed, preferential subscription rights which have not been exercised will
be extinguished and shareholders who have not exercised their rights will not be compensated in
any manner.
Shareholders who are also directors of PESCANOVA have notified the COMPANY of their
decision to subscribe for and pay up, overall, a minimum of 25,000,012.65 euros by subscription
and payment up of 1,858,737 New Shares, representing approximately 20% of the total New
Shares which are issued pursuant to the Capital Increase.
The remaining members of the Board of Directors and members of senior management of
PESCANOVA have not given any indication to the COMPANY regarding their intention to
exercise the preferential subscription rights they may hold.
Potential future dilution deriving from the conversion of convertible bonds.
The COMPANY has at the date of approval of this Share Securities Note issued convertible bonds
and/or bonds exchangeable for PESCANOVA shares, belonging to three different issues, with an
outstanding overall balance of 369.3 million euros.
In accordance with their terms and conditions, maturity of these bond issues will take place
between the years 2015 and 2019, and the prices for conversion and/or exchange for shares of
PESCANOVA vary between 26.32 euros and 36.24 euros at the present date (although the said
prices will be adjusted by application of the anti-dilution adjustments provided in these issues by
reason of issue of the New Shares on the Capital Increase). The holders of these bonds may
voluntarily request their conversion into PESCANOVA shares during the lifetime of the issue until
the seventh day prior to the maturity date. In accordance with normal practice of holders of this
type of security, these applications for conversion and/or exchange will be more likely to take place
at the end of the lifetime of each of the issues and to the extent that the traded price of the
PESCANOVA shares on the Stock Exchanges is above the conversion and/or exchange price.
Furthermore, in accordance with the terms and conditions of these issues, the COMPANY is able
to meet these applications by delivery of shares (new or existing shares), cash or a combination of
both. In the event that the COMPANY elects to deliver new shares to the holders of these
debentures, the shareholders of the COMPANY would suffer a dilution of their shareholding in the
COMPANY to the extent that, in accordance with Section 304 of the Capital Companies Act, there
would be no right to preferential subscription with respect to the capital increase necessary to meet
the conversion of bonds into shares.
Illiquidity of the New Shares in the event of delay in admission to trading.
The New Shares will be admitted to trading on the Madrid and Bilbao Stock Exchanges, and
included in the Stock Exchange Interconnection System (Continuous Market) on a date which it is
estimated will not be after 15 August 2012. Any delay in commencement of stock exchange trading
of the New Shares would deprive investors of liquidity in the market for these shares, hampering
their disposal by investors.
Summary
11
Section D — Risks
Subsequent illiquidity of the New Shares based on level of capitalisation and volume of contracting
of the PESCANOVA shares.
The market capitalisation of PESCANOVA before the Capital Increase was around 430 million
euros on 6 July 2012. For its part, the average volume of daily trading of PESCANOVA shares in
the Continuous Market during the 2011 financial year was around 750,000 euros and around
586,174 euros during the 2012 financial year. Based on the limited volume of trading in
PESCANOVA shares in the Continuous Market and the relatively reduced capitalisation of the
COMPANY, it cannot be guaranteed to shareholders and those acquiring preferential subscription
rights who subscribe for New Shares issued pursuant to the Capital Increase that they will be able
to have a sufficiently liquid market to sell their shares at the time they wish.
Volatility of the quotation price of PESCANOVA shares.
PESCANOVA cannot ensure that the New Shares issued as a result of the Capital Increase will
subsequently be traded at a price equal or similar to the price at which the issue is made. The
market price of PESCANOVA shares may be volatile. Factors such as fluctuations in the results of
the COMPANY, changes in the recommendations of financial analysts regarding the COMPANY,
and the situation of financial markets, could have a negative impact on the trading price of
PESCANOVA shares.
Shares susceptible to subsequent sale.
The issue or sale of a substantial number of PESCANOVA shares in the market after the Capital
Increase, or a perception that such sales could occur, could negatively affect the quotation price of
PESCANOVA shares.
Section E — Offer
E.1
E.2a
The total net
proceeds and an
estimate of the
total expenses of
the issue/offer,
including
estimated
expenses
charged to the
investor by the
issuer or the
offeror
Reasons for the
offer, use of
proceeds,
estimated net
amount of the
proceeds.
The expenses of the Capital Increase (without including VAT) are those indicated below on a purely
informative basis given the difficulty of specifying their definitive amount:
EXPENSES
CNMV Fees
Fees of Spanish Stock Exchanges
Fees of IBERCLEAR
Management and distribution fees
Other expenses (including agency fee, legal and commercial publicity, printing,
legal advice, auditing)
TOTAL
Estimated Amount
(thousands of €)
9.5642
7
7
4,450
330
4,803.5642
The total expenses of the Capital Increase represent approximately 3.84% of the countervalue of the
New Shares, assuming full subscription of the estimated amount (124,956,740.80 euros) of the
Capital Increase, such that net receipts from the Capital Increase amount to 120,153,176.60 euros.
As a result of the increasing demand in European, Asian and USA markets for seafood products from
wild fish and from aquaculture, the PESCANOVA Group in recent years has engaged in a strategy of
positioning in fish production areas and in particular aquaculture, in order to be able to supply
markets with the species most in demand, to which end investments were made in this latter area
basically aimed at the production of species such as prawn, turbot and salmon, which strengthen the
vertical integration of the PESCANOVA Group.
The COMPANY has engaged in substantial investment efforts, as well as financing the working
capital necessary for the activity of these plants, by partially making use of outside resources,
thereby increasing the gearing ratio of PESCANOVA.
In this situation, and further taking into account the current economic environment, PESCANOVA
has decided to carry out the Capital Increase covered by this Securities Note, by which the
COMPANY expects to obtain funds of 120.2 million euros (net of the expenses indicated in Element
E.1 of this Securities Note and assuming it is fully subscribed for and paid up), with the objective of
strengthening its own funds and the financial structure of the COMPANY, reducing its gearing and
improving its debt ratios. PESCANOVA will use the funds obtained from the Capital Increase to
cover general financing requirements of the Group and reduce its dependency on financing through
the credit market, and reduce its third party liabilities as appropriate. In this respect the Capital
Increase follows the strategy initiated by PESCANOVA in 2010 of diversifying its sources of
Summary
12
Section E — Offer
financing and reducing the weight of bank debt in the overall financial liabilities of the COMPANY
in which the three issues of bonds convertible into shares made by PESCANOVA in 2010 and 2011
are set.
The following table shows the estimated impact of the Capital Increase on the ratios of “own
funds/financial debt with recourse” and “financial debt with recourse/EBITDA”, assuming it is fully
subscribed, compared with the ratios at 31 March 2012.
PESCANOVA Group
E.3
A description of
the terms and
conditions of the
offer.
Pre-Capital Increase
(data at 31 March 2012)
Post-Capital Increase
Ratio of Own Funds/Financial Debt with Recourse
0.74
1.11
Ratio of Financial Debt with Recourse/EBITDA
3.78
3.12
Total amount of the Capital Increase.
The Capital Increase pursuant to which the New Shares will be issued has a nominal amount of
55,742,784 euros and will take place by issue and placement into circulation of 9,290,464 newly
issued ordinary shares of the COMPANY, with a nominal value of 6 euros each and of the same
class and series as those currently in circulation. The New Shares will be issued at an issue premium
of 7.45 euros per share, which means a total issue premium of 69,213,956.80 euros, and a unit issue
rate of 13.45 euros per New Share (the “Subscription Price”). The total cash amount will be
124,956,740.80 euros or the resulting amount, as the case may be, in the event of incomplete
subscription.
Procedure for subscription and payment.
First round: Preferential Subscription Period
The New Shares are issued with acknowledgement of preferential subscription rights of the current
shareholders of the COMPANY (other than the COMPANY itself) which are accredited as such in
accordance with the book records of IBERCLEAR at 23:59 hours Madrid time on the day prior to
commencement of the preferential subscription period (hereinafter the “Preferential Subscription
Period”), who may exercise their right of preferential and proposal subscription with respect to all of
the shares issued, in the proportion of 1 New Share for each 2 shares of the COMPANY in
circulation which they hold.
It is recorded that the COMPANY is holder of a total of 88,460 own shares, and is party to an equity
swap with Commerzbank AG in respect of 777,866 shares of PESCANOVA entered into on 20 June
2011, which remains in force, which can be assimilated, for the purposes of not acknowledging right
of preferential subscription to the direct holding of own shares by the COMPANY itself and
therefore they have been deducted from the total number of shares in circulation for the purpose of 1
New Share for each 2 shares in circulation of the COMPANY. No entity controlled by the
COMPANY is holder of shares in PESCANOVA.
The Preferential Subscription Period for shareholders and investors acquiring preferential
subscription rights will begin on the day following that of publication of the resolution of the Board
of Directors of 2 July 2012 relating to the Capital Increase by issue and placement into circulation of
the New Shares in the Commercial Registry Official Gazette (the “BORME”), i.e. 12 July 2012 and
will end when 15 calendar days have elapsed, i.e. on 26 July 2012. The preferential subscription
rights will be transferable on the same conditions as the shares from which they derive, in
accordance with Section 306.2 of the Capital Companies Act, and will be negotiable on the Madrid
and Bilbao Stock Exchanges through the Stock Exchange Interconnection System (Continuous
Market).
During the Preferential Subscription Period, shareholders and investors may, at the time of
exercising their preferential subscription rights, in addition, and on an unconditional and irrevocable
basis, apply for subscription of shares of the COMPANY in the event that at the end of the
Preferential Subscription Period remain shares which are not subscribed for in exercise of
preferential subscription rights (hereinafter “Additional Shares”), and therefore the total amount of
this Capital Increase has not been covered.
In order to exercise the preferential subscription rights and, as the case may be, apply to subscribe for
Additional Shares, shareholders and/or investors must approach the Participant Entity in
IBERCLEAR in whose book records the preferential subscription rights are recorded (which in the
case of shareholders would be the Participant Entity in which they have deposited the shares which
grant them the said rights), indicating their desire to exercise their right of preferential subscription
and, as the case may be, to apply for subscription for shares in the Additional Allotment Period (as
this term is subsequently defined). In order to apply for Additional Shares the shareholder or investor
must have exercised all their preferential subscription rights.
Summary
13
Section E — Offer
Orders given relating to exercise of preferential subscription rights will be deemed to be made on a
firm, irrevocable and unconditional basis and will mean subscription for the New Shares to which
they relate. Orders relating to applying for Additional Shares must be made in a particular amount,
will not be subject to a quantitative limit and will also be deemed to be made on a firm, irrevocable
and unconditional basis, without prejudice to the fact that they may not be fulfilled in whole on
application of the rules for allotment of Additional Shares described later on. The Additional Shares
allotted to shareholders and/or Acquirers of Rights who have requested them will be deemed to be
subscribed for during the Additional Allotment Period.
Preferential subscription rights not exercised will be extinguished automatically on completion of the
Preferential Subscription Period.
The theoretical value of each preferential subscription right will be calculated on the closing price on
the day prior to commencement of the Preferential Subscription Period, in accordance with the
following formula:
(PC – PE) * NAN
VTD=--------------------NAP + NAN
Where:
VTD:
Theoretical value of the right, taking into account that a dividend distribution has not been
resolved.
PC:
Closing quotation price corresponding to the stock exchange session of the day prior to
commencement of the Preferential Subscription Period.
PE:
Issue price: 13.45 euros per Share.
NAP:
Number of shares prior to the Capital Increase with preferential subscription rights
(discounting treasury shares as indicated previously - 866,326): 18,580,928.
NAN:
Number of New Shares: 9,290,464.
Based on the quotation price of the PESCANOVA share at session closing on 6 July 2012, (22.11
euros) the theoretical value of each preferential subscription right would amount to 2.8867 euros.
Second round: Additional Allotment Period
In the event that after completion of the Preferential Subscription Period New Shares remain without
being subscribed for, such Additional Shares will be allotted to those shareholders and/or investors
who have applied for them during the Preferential Subscription Period (the “Additional Allotment
Period”).
For these purposes, by no later than 18:00 hours Madrid time on the fourth business day following
the date of completion of the Preferential Subscription Period, the Agent indicated in the following
E.4 will inform PESCANOVA of the precise number of Additional Shares for allotment to those
shareholders and/or Acquirers of Rights who have applied for them. It is expected that the allotment
of Additional Shares will take place on 1 August 2012.
In the event that the total number of Additional Shares applied for in the Preferential Subscription
Period for allotment in the Additional Allotment Period exceeds the number of New Shares which
remain unallotted pursuant to exercise of preferential subscription rights, the Agent shall make a pro
rata spreading amongst applicants for Additional Shares in proportion to the percentage which the
number of Additional Shares applied for by each applicant bears to the total volume of Additional
Shares applied for.
To this end the Agent will calculate the number of Additional Shares which will correspond to each
applicant for Additional Shares applying the coefficient resulting from dividing the Additional Shares
available by the total Additional Shares applied for.
In no event shall more New Shares be allotted to shareholders or investors than they have applied for.
Third round: Discretionary Allotment Period
In the event that the shares subscribed for during the Preferential Subscription Period, together with
the Additional Shares assigned to subscribers, are not sufficient to cover the whole of the New Shares
covered by this Capital Increase (the difference between the total New Shares and the sum of those
subscribed for in the Preferential Subscription Period and in the Additional Allotment Period is
referred to as the “Discretionary Allotment Shares”), the Agent shall give notice thereof to the
COMPANY and the Underwriters by no later than 18:00 hours Madrid time on the fourth business
day following the end of the Preferential Subscription Period and a discretionary allotment period
will begin for these shares after completion of the Additional Allotment Period. This will be for a
maximum duration of one business day, beginning on 18:00 hours Madrid time on the fourth business
Summary
14
Section E — Offer
day after the end of the Preferential Subscription Period and ending on the fifth business day after the
said end (in accordance with the expected timetable 2 August 2012) (the “Discretionary Allotment
Period”).
During the Discretionary Allotment Period the Underwriters will engage in activities of active
promotion and dissemination in order to obtain proposals for subscription in respect of the
Discretionary Allotment Shares from persons who have the status of qualified investors in Spain, as
the said term is defined in Section 39 of Royal Decree 1310/2005, of 4 November, or who have the
status of qualified investors outside Spain in accordance with applicable legislation in each country.
After allocation of Discretionary Allotment Shares to investors their proposals will become firm.
Underwriting and distribution
An underwriting and distribution agreement (the “Underwriting Agreement”) has been signed,
under which approximately 64% of the New Shares are underwritten by BNP Paribas (“BNP
Paribas”), which will act as global coordinator and Sole Bookrunner of the Capital Increase and with
Banco BPI, S.A. (jointly with BNP Paribas, “Underwriters”).
The number of New Shares underwritten by each Underwriter and the percentage of the Capital
Increase underwritten by each of them are as follows:
New Shareholders
underwritten
Underwriter
(By
number)
(By %)
52%
BNP Paribas ............................................................................ 4,832,714
12%
Banco BPI, S.A. ....................................................................... 1,115,242
Total Underwriting Commitment .......................................... 5,947,956
64%
It is further reported that certain significant shareholders who are also directors of PESCANOVA, or
who proposed the appointment of proprietary directors of PESCANOVA, have undertaken to
subscribe for and pay up overall a cash amount of at least 25,000,012.65 euros by subscription and
payment up of 1,858,737 New Shares representing approximately 20% of the Capital Increase,
consequently with approximately 16% of the Capital Increase not underwritten.
Estimated timetable
A tentative timetable is shown below of the Capital Increase:
Forecast Timetable for the Capital Increase
Action/Stage
Estimated date
Approval and registration of the Securities Note by the
CNMV ........................................................................................
Publication of the announcement in the BORME .......................
Commencement of the Preferential Subscription Period and
of application for Additional Shares............................................
End of the Preferential Subscription Period and for
application of Additional Shares .................................................
Additional Allotment Period .......................................................
Relevant fact reporting on the result of the Preferential
Subscription Period and of the Additional Allotment Period ......
Commencement, as the case may be, of the Discretionary
Allotment Period .........................................................................
10 July 2012
11 July 2012
12 July 2012
26 July 2012
1 August 2012
1 August 2012
1 August 2012
Payment up of the shares subscribed for in the Preferential
2 August 2012
Subscription Period and in the Additional Allotment Period .......
Completion, as the case may be, of the Discretionary
Allotment Period .........................................................................
Payment up of shares subscribed for in the Discretionary
Allotment Period .........................................................................
Resolution to execute the Capital Increase/relevant fact
(“Transaction Date”) .................................................................
Execution of notarised public deed of capital increase ................
Registration of the public deed of Capital Increase in the
Commercial Registry ..................................................................
Allocation by IBERCLEAR of registry references
corresponding to the New Shares subscribed ..............................
Commencement of listing of the New Shares .............................
Summary
15
2 August 2012
7 August 2012
7 August 2012*
7 August 2012
8 August 2012
9 August 2012
15
August 2012
Section E — Offer
* In the event that the Discretionary Allotment Period is not commenced since no surplus shares
remain after the Preferential Subscription Period and the Additional Allotment Period, the
Transaction Date would be brought forward to 2 August 2012, and consequently bringing forward the
rest of the timetable.
E.4
A description of
any interest that
is material to the
issue/offer
including
conflicting
interest.
BNP Paribas, which acts as Global Coordinator and Sole Bookrunner of the Capital Increase was
underwriter of the capital increase with preferential subscription rights in cash amount of 100.5
million euros carried out by PESCANOVA in October 2009 and of the three issues of bonds
convertible into shares made by the COMPANY in March 2010, April 2011 and February 2012, the
current outstanding of which is 369.3 million euros. Furthermore, it is a lender to the COMPANY in
syndicated financing obtained by PESCANOVA in non-significant amounts.
BNP Paribas Securities Services, Sucursal en España, a company belonging to the BNP Paribas
Group and which acts as Agent of the Increase, is in turn a trustee of the three issues of bonds
convertible and/or exchangeable for shares of PESCANOVA currently in circulation. BNP Paribas
Securities Services, Bank of Spain, also acted as Agent in the aforesaid capital increase with
preferential subscription rights of PESCANOVA in October 2009.
For its part, BNP Paribas Securities Services, Luxembourg Branch, a company in the BNP Group,
acts as payment, transfer and conversion agent and as body responsible for registration of each of
these issues of convertible and/or exchangeable bonds.
Banco BPI, S.A., underwriter of the Capital Increase, was underwriter of the capital increase with
preferential subscription rights of October 2009 and of the issues of bonds convertible into shares
made by the COMPANY in March 2010 and April 2011 previously referred to and also finances the
activities of PESCANOVA and subsidiary companies in an overall amount of approximately 71
million euros (of which approximately 27 million relate to project finance transactions without
recourse).
E.5
Name of the
person or entity
offering to sell
the security.
Lock-up
agreements: the
parties involved,
and indication of
the period of the
lock-up.
Name of the person or entity offering to sell the security
BNP Paribas will act as Global Coordinator and Sole Bookrunner of the Capital Increase. BNP
Paribas together with Banco BPI, S.A. are the Underwriters of the Increase.
Lock-up agreements: the parties involved, and indication of the period of the lock-up
The COMPANY has undertaken, without authorisation of both Underwriters (which may not be
unreasonably refused or postponed without cause) not to issue, offer, sell, agree to issue or sell or, in
any other way, directly or indirectly dispose of, or perform any transaction that might have an
economic effect similar to the issuance or sale, or the announcement of the issuance or sale, of shares
of the COMPANY, securities that are convertible or exchangeable into or otherwise giving access to
shares of the COMPANY, warrants, or any other instruments that might give the right to subscribe or
acquire shares of the COMPANY, including by means of derivative transactions, from the date of the
Underwriting Agreement until one hundred and eighty (180) days following the date of the admission
to trading of the New Shares on the Stock Exchanges.
As the only exceptions to such undertaking, PESCANOVA may, without being necessary the
aforementioned prior authorization of the Underwriters, carry out: (i) issuances and/or deliveries of
options and shares granted to employees and officers of the COMPANY or its material subsidiaries
within the framework of compensation for such employees or officers (including those shares that,
within the framework of such programmes, are subscribed or acquired by financial entities), as well
as shares that are issued as a result of the exercise of such options; (ii) transfer of shares resulting
from the ordinary-course trading by PESCANOVA on its treasury shares in a manner consistent with
its past practice; (iii) transfers of shares between entities belonging to the same group (within the
meaning of article 42 of the Spanish Commercial Code) provided the acquiring entity commits not to
transfer the shares for the remaining period; (iv) issue of shares to honour the conversion of the
convertible bonds issued by the COMPANY prior to the closing date into shares; and (v) transfer of
the equity swap shares at maturity or in the event of early termination of the equity swap by the
counterparty.
Furthermore, the shareholder Sociedad Anónima de Desarrollo y Control (SODESCO), a company
controlled by Mr. Manuel Fernández de Sousa-Faro, has also entered into similar agreements which
prohibit the disposal of shares of the COMPANY from the date of the Underwriting Agreement until
180 days have elapsed from the date of admission to trading of the New Shares. As sole exception to
this commitment, the said shareholder may without requiring the authorisation of the two
Underwriters (i) transfer shares between entities belonging to the same group within the meaning of
Section 42 of the Commercial Code, provided that any transferee has agreed to be bound by the same
restrictions for the remainder of such 180 day period, (ii) transfer shares by way of tendering them in
Summary
16
Section E — Offer
a takeover offer over the COMPANY, and (iii) transfer those preferential subscription rights as it is
not required to retain and exercise in order to reinvest in full the proceeds of those sales in the
subscription of New Shares.
In the event that (i) the COMPANY notifies shareholders that it has no intention to carry out the
Capital Increase, or (ii) for any reason the Underwriting Agreement is terminated, the COMPANY
and the shareholder referred to above will immediately and automatically be released from the
commitments not to transfer shares assumed to the Underwriters.
E.6
E.7
Amount and
percentage of
immediate
dilution
resulting from
the offer
Estimated
expenses
charged to the
investor by the
issuer or offeror
Summary
The shareholders of the COMPANY have preferential subscription rights for the New Shares covered
by the Capital Increase, and therefore if they exercise the said rights they will not suffer any dilution
in their holding in the share capital of the COMPANY.
In the event that a shareholder of the COMPANY does not subscribe for New Shares in the
percentage corresponding thereto as a result of preferential subscription rights, the holding thereof
would suffer a dilution of 32.33% of the capital prior to the Capital Increase.
The Capital Increase is made free of expenses to subscribers, who will only have to subscribe in the
amount of nominal value and issue premium of each New Share without prejudice to the expenses,
brokerage and commissions expressly established in their tariff leaflets by Iberclear Participants
through which shareholders and investors process their orders for subscription for New Shares.
17
II. INFORMATION
INCREASE
ON
THE
SECURITIES
OF
THE
CAPITAL
(Share Securities Note drawn up in accordance with Annex III of Regulation
(EC) No. 809/2004, of the European Commission, of 29 April 2004, relating
to the application of Directive 2003/71/EC)
0.
RISK FACTORS
0.1 Irrevocability of subscription.
The shareholders of PESCANOVA who exercise preferential subscription
rights held by them, and investors who acquire and exercise them, during the
Preferential Subscription Period of the Increase may not revoke subscriptions
made in the said period nor applications which they make to subscribe for
additional shares, even if the Underwriting Agreement referred to in the
following section 5.4.3 is terminated on the grounds laid down therein or it
does not come into force as a result of failure to fulfil any of the conditions
precedent provided in it. As sole exception to the foregoing, if the
Underwriting Agreement is terminated, applications for subscriptions for
shares made during the Discretionary Allotment Period would be
automatically revoked.
Consequently, shareholders and those acquiring preferential subscription
rights will be obliged to acquire the shares even if the quotation price in the
Continuous Market of the PESCANOVA shares is below the Subscription
Price of the New Shares.
0.2 Partial underwriting of the Capital Increase.
The Capital Increase is guaranteed in part in respect of approximately 84% of
the New Shares, of which 20% relate to commitments to subscription
assumed to the COMPANY by major shareholders who are in turn directors
of the COMPANY, or who have proposed the appointment of proprietary
directors, and approximately 64% to underwriting commitments assumed by
BNP Paribas and Banco BPI, S.A. in the event that New Shares remain
undistributed after the Discretionary Allotment Period.
Consequently, approximately 16% of the Capital Increase may not be issued
in the event that there is insufficient demand, in which case incomplete
subscription of the Capital Increase would be declared in the cash amount
subscribed for, which as previously indicated would be at least approximately
105 million euros.
0.3 Uncertainty regarding development of an active market for the preferential
subscription rights.
The preferential subscription rights relating to the Capital Increase covered by
this Prospectus will be negotiable on the Madrid and Bilbao Stock Exchanges
Securities Note
18
through the Stock Exchange Interconnection System (Continuous Market)
during trading sessions which fall within the 15 calendar days following
publication of the announcement of the Capital Increase in the Commercial
Registry Official Gazette (Boletín Oficial del Registro Mercantil —
BORME—). PESCANOVA cannot guarantee that an active trading market
will develop for the said rights or the price at which the said rights will be
traded.
0.4 A possible significant fall in the quotation price of the PESCANOVA shares
could negatively affect the value of the quotation price of the preferential
subscription rights.
Since the trading price of the preferential subscription rights depends on the
trading price of the PESCANOVA shares, a possible significant fall in the
quotation price of PESCANOVA shares could negatively affect the value of
the preferential subscription right and therefore this value could be affected
by the same risks as those of the shares of PESCANOVA.
PESCANOVA cannot guarantee to holders of preferential subscription rights
that the price of the PESCANOVA shares will not fall below the subscription
price for shares after the holders of preferential subscription rights have
decided to exercise them. If this occurs, the holders of preferential
subscription rights will have committed to acquiring New Shares at a price
higher than that of the market. Furthermore, PESCANOVA cannot guarantee
to holders of preferential subscription rights that after exercise of the said
rights they can manage to sell their shares at a price equal to or higher than
the Subscription Price.
0.5 Those shareholders who do not exercise their preferential subscription
rights over the New Shares will see their holding in the capital of
PESCANOVA diluted.
Since, with the Capital Increase, New Ordinary Shares of PESCANOVA will
be issued, those shareholders who do not exercise their preferential
subscription rights will experience dilution of their holding in PESCANOVA
by 32.33% of their current holding, in the event that there is subscription for
100% of the New Shares issued. Furthermore, even in the event that the
shareholder transfers his unexercised preferential subscription rights, the price
he receives as consideration may not be sufficient to compensate him
completely for dilution of his holding in the share capital of PESCANOVA as
a result of the Capital Increase. Also, after the Preferential Subscription
Period has elapsed, preferential subscription rights which have not been
exercised will be extinguished and shareholders who have not exercised their
rights will not be compensated in any manner.
As described in section 5.2.2 of the Share Securities Note, shareholders who
are also directors of PESCANOVA have notified the COMPANY of their
decision to subscribe for and pay up, overall, a minimum of 25,000,012.65
euros by subscription and payment up of 1,858,737 New Shares, representing
Securities Note
19
approximately 20% of the total New Shares which are issued pursuant to the
Capital Increase.
The remaining members of the Board of Directors and members of senior
management of PESCANOVA have not given any indication to the
COMPANY regarding their intention to exercise the preferential subscription
rights they may hold.
0.6 Potential future dilution deriving from the conversion of convertible bonds.
The COMPANY has at the date of approval of this Share Securities Note
issued convertible bonds and/or bonds exchangeable for PESCANOVA
shares, belonging to three different issues, with an outstanding overall balance
of 369.3 million euros.
In accordance with their terms and conditions, maturity of these bond issues
will take place between the years 2015 and 2019, and the prices for
conversion and/or exchange for shares of PESCANOVA vary between 26.32
euros and 36.24 euros at the present date (although the said prices will be
adjusted by application of the anti-dilution adjustments provided in these
issues by reason of issue of the New Shares on the Capital Increase). The
holders of these bonds may voluntarily request their conversion into
PESCANOVA shares during the lifetime of the issue until the seventh day
prior to the maturity date. In accordance with normal practice of holders of
this type of security, these applications for conversion and/or exchange will
be more likely to take place at the end of the lifetime of each of the issues and
to the extent that the traded price of the PESCANOVA shares on the Stock
Exchanges is above the conversion and/or exchange price.
Furthermore, in accordance with the terms and conditions of these issues, the
COMPANY is able to meet these applications by delivery of shares (new or
existing shares), cash or a combination of both. In the event that the
COMPANY elects to deliver new shares to the holders of these debentures,
the shareholders of the COMPANY would suffer a dilution of their
shareholding in the COMPANY to the extent that, in accordance with Section
304 of the Capital Companies Act, there would be no right to preferential
subscription with respect to the capital increase necessary to meet the
conversion of bonds into shares.
0.7 Illiquidity of the New Shares in the event of delay in admission to trading.
The New Shares will be admitted to trading on the Madrid and Bilbao Stock
Exchanges, and included in the Stock Exchange Interconnection System
(Continuous Market) on a date which it is estimated will not be after 15
August 2012. Any delay in commencement of stock exchange trading of the
New Shares would deprive investors of liquidity in the market for these
shares, hampering their disposal by investors.
Securities Note
20
0.8 Subsequent illiquidity of the New Shares based on level of capitalisation
and volume of contracting of the PESCANOVA shares.
The market capitalisation of PESCANOVA before the Capital Increase was
around 430 million euros on 6 July 2012. For its part, the average volume of
daily trading of PESCANOVA shares in the Continuous Market during the
2011 financial year was around 750,000 euros and around 586,174 euros
during the 2012 financial year. Based on the limited volume of trading in
PESCANOVA shares in the Continuous Market and the relatively reduced
capitalisation of the COMPANY, it cannot be guaranteed to shareholders and
those acquiring preferential subscription rights who subscribe for New Shares
issued pursuant to the Capital Increase that they will be able to have a
sufficiently liquid market to sell their shares at the time they wish.
0.9 Volatility of the quotation price of PESCANOVA shares.
PESCANOVA cannot ensure that the New Shares issued as a result of the
Capital Increase will subsequently be traded at a price equal or similar to the
price at which the issue is made. The market price of PESCANOVA shares
may be volatile. Factors such as fluctuations in the results of the COMPANY,
changes in the recommendations of financial analysts regarding the
COMPANY, and the situation of financial markets, could have a negative
impact on the trading price of PESCANOVA shares.
0.10
Shares susceptible to subsequent sale.
The issue or sale of a substantial number of PESCANOVA shares in the
market after the Capital Increase, or a perception that such sales could occur,
could negatively affect the quotation price of PESCANOVA shares.
1.
PERSONS RESPONSIBLE
1.1 Identification of persons responsible.
Manuel Fernández de Sousa-Faro, on behalf of Pescanova, S.A.
(“PESCANOVA” or the “COMPANY”), in his capacity as Chairman of the
Board of Directors of the COMPANY, and duly authorised for the purpose
pursuant to resolutions passed by the Board of Directors of the COMPANY
on 2 July 2012, assumes liability for the contents of this share securities note (
“Securities Note”) in respect of the capital increase of PESCANOVA (the
“Increase” or the “Capital Increase”).
Securities Note
21
1.2 Declaration by persons responsible.
Manuel Fernández de Sousa-Faro, as person responsible for this Securities
Note, declares that after acting with reasonable diligence to ensure that the
same is the case, the information contained therein is to his knowledge in
accordance with the facts and there are no omissions which could affect its
contents.
2.
RISK FACTORS
See the previous section 0 of this Securities Note.
3.
KEY INFORMATION
3.1 Working capital statement.
PESCANOVA considers that its working capital at the present time (prior to
the Capital Increase) is sufficient to meet current obligations of the
COMPANY as they fall due over the forthcoming 12 months.
3.2 Capitalisation and indebtedness.
A table is included below setting out the capitalisation and indebtedness of
PESCANOVA at consolidated level, in accordance with the provisional
unaudited balance sheet at 31 March 2012. Between 31 March 2012 and the
date of verification of this Securities Note no significant variation has taken
place with respect to the capitalisation and debt information of the
COMPANY detailed in this section:
Thousands of euros
Own Funds
(Unaudited data) (in accordance with IAS)
Subscribed capital
31/03/2012
116,683
Issue premium
57,043
Reserves (parent and consolidated companies)
328,417
Conversion differences
-4,315
Other valuation adjustments
-6,936
Profit for year
9,042
TOTAL
499,934
External shareholders
25,311
Own Funds + external shareholders
525,245
Total Liabilities (Unaudited data) (in accordance with IAS)
Current Liabilities
185,713
Secured or guaranteed (1)
5,891
Unsecured
Securities Note
179,822
22
Thousands of euros
Own Funds
(Unaudited data) (in accordance with IAS)
Non-current liabilities
31/03/2012
761,379
Secured or guaranteed (2)
46,310
Unsecured
715,069
Total Financial Liabilities
947,092
Other Non-Financial liabilities
760,136
TOTAL
1,707,228
(1) and (2) do not include financial debt “without recourse” (that which cannot be
enforced against the parent).
Thousands of euros
Breakdown of Financial Debt
(Unaudited data) (in accordance with IFRS)
Current debt with recourse with credit institutions
Current debt without recourse
31/03/2012
184,203
1,510
Current debt
185,713
Bonds and other negotiable securities
346,525
Non-current debt with recourse with credit institutions
293,534
Non-current debt without recourse
121,320
Non-current debt
761,379
Total Financial Debt
947,092
Cash and banks and other financial investments (2)
114,705
Total Net Debt (1) - (2)
832,387
The PESCANOVA Group does not show any indirect or contingency debt.
3.3 Interest of natural and legal persons involved in the Capital Increase.
BNP Paribas, which acts as Global Coordinator and Sole Bookrunner of the
Capital Increase, was underwriter of the capital increase with preferential
subscription rights in the cash amount of 100.5 million euros made by
PESCANOVA in October 2009 and of the three issues of bonds convertible
into shares made by the COMPANY in March 2010, April 2011 and February
2012, the current outstanding balance of which amounts to 369.3 million
euros. Furthermore, it is a creditor of the COMPANY in syndicated financing
obtained by PESCANOVA in amounts which are not significant.
BNP Paribas Securities Services, Sucursal en España, a company belonging
to the PNP Paribas Group, and which acts as Agent for the Increase, is in turn
trustee of the three issues of bonds convertible and/or exchangeable for shares
Securities Note
23
of PESCANOVA currently in circulation. BNP Paribas Securities Services,
Sucursal en España, also acted as agent of the aforesaid capital increase with
preferential subscription rights of PESCANOVA of October 2009.
For its part, BNP Paribas Securities Services, Luxembourg Branch, a
company in the BNP group, acted as payment, transfer and conversion agent
and as entity responsible for registration of each of the said issues of
convertible and/or exchangeable bonds.
Banco BPI, S.A., underwriter of the Capital Increase (together with BNP
Paribas, the “Underwriters”) was underwriter of the aforesaid capital
increase with preferential subscription rights of October 2009 and of the
issues of bonds convertible into shares made by the COMPANY in March
2010 and April 2011 previously referred to and also finances the activities of
PESCANOVA and subsidiary companies in an overall amount of
approximately 71 million euros (of which approximately 27 million relate to
project finance transactions without recourse).
Apart from the said interests, the COMPANY is unaware of the existence of
any other connection or financial interest between PESCANOVA and the
entities listed in this Securities Note.
3.4 Reasons for the Capital Increase and use of proceeds.
As a result of the increasing demand in European, Asian and USA markets
for seafood products from wild fish and from aquaculture, the PESCANOVA
Group in recent years has engaged in a strategy of positioning in fish
production areas and in particular aquaculture, in order to be able to supply
markets with the species most in demand, to which end investments were
made in this latter area basically aimed at the production of species such as
prawn, turbot and salmon, which strengthen the vertical integration of the
PESCANOVA Group.
The COMPANY has engaged in substantial investment efforts, as well as
financing the working capital necessary for the activity of these plants, by
partially making use of outside resources, thereby increasing the gearing ratio
of PESCANOVA.
In this situation, and further taking into account the current economic
environment, PESCANOVA has decided to carry out the Capital Increase
covered by this Securities Note, by which the COMPANY expects to obtain
funds of 120.2 million euros (net of the expenses indicated in section 8 of this
Securities Note and assuming it is fully subscribed for and paid up), with the
objective of strengthening its own funds and the financial structure of the
COMPANY, reducing its gearing and improving its debt ratios.
PESCANOVA will use the funds obtained from the Capital Increase to cover
general financing requirements of the Group and reduce its dependency on
financing through the credit market and, as appropriate, reducing its third
party liabilities. In this respect the Capital Increase follows the strategy
initiated by PESCANOVA in 2010 of diversifying its sources of financing
Securities Note
24
and reducing the weight of bank debt in the overall financial liabilities of the
COMPANY in which the three issues of bonds convertible into shares made
by PESCANOVA between 2010 and 2012 are set.
The following table shows the estimated impact of the Capital Increase on the
ratios of “own funds/financial debt with recourse” and “financial debt with
recourse/EBITDA”, assuming it is fully subscribed, compared with the ratios
at 31 March 2012.
Pre-Capital
Increase
(data at 31
March 2012)
Post-Capital Increase
Ratio of Own Funds/Financial Debt with Recourse
0.74
1.11
Ratio of Financial Debt with Recourse/EBITDA
3.78
3.12
PESCANOVA Group
4.
INFORMATION CONCERNING THE
OFFERED/ADMITTED TO TRADING
SECURITIES
TO
BE
4.1 Type, class and identification of the securities.
The New Shares are ordinary shares of PESCANOVA, with a nominal value
of six euros each, of the same class and series as the existing shares and will
grant their holders the same rights as those which are currently in circulation,
as from the time when the Capital Increase pursuant to which the New Shares
are issued is declared subscribed for and paid up by the Board of Directors
or, by delegation therefrom, by the Chairman of the Board of Directors
(hereinafter the “Transaction Date”).
The ISIN Code or international identification number of the shares of the
COMPANY currently in circulation is ESO169350016. The New Shares will
have a different provisional ISIN Code until this code is made the same as
that of the current shares, and, after admission to trading, they will be listed,
as are the shares of the COMPANY currently in circulation, on the Madrid
and Bilbao Stock Exchanges through the Stock Exchange Interconnection
System (Continuous Market).
4.2 Legislation under which the securities have been created.
The legal regime applicable to the New Shares is that laid down by Spanish
law, and specifically the provisions of Royal Legislative Decree 1/2010, of 2
July, enacting the revised text of the Capital Companies Act (the “Capital
Companies Act” or “CCA”) and the Securities Market Act, 24/1988 of 28
July (the “SMA”), and their respective implementing regulations which are
applicable.
Securities Note
25
4.3 Form of representation of the Shares.
The New Shares will be represented by book entry, which will be recorded in
the corresponding accounting records maintained by “Sociedad de Gestión de
los Sistemas de Registro, Compensación y Liquidación de Valores, S.A.U.”
(“IBERCLEAR”), with registered office at Plaza de la Lealtad 1, 28014
Madrid, and its authorised participants (“Participant Entities”).
4.4 Currency of issue of the Shares.
The shares of the COMPANY are referred to in euros.
4.5 Description of rights attached to the Shares, including any limitations on
these rights, and procedure for exercising them.
The New Shares are ordinary shares and will have the same voting,
information and financial rights as the remaining PESCANOVA shares as
from the Transaction Date. In particular, the following rights can be
mentioned, on the terms laid down in the Articles of Association of the
COMPANY:
Right to dividends:
a)
Fixed date or dates on which the entitlement arises.
The New Shares grant their holders the right to participate in the
distribution of corporate profits and resulting assets on liquidation on the
same conditions as the remaining shares in circulation and, as with the
other shares which make up the capital of the COMPANY, they carry no
right to receive a minimum dividend since they are all ordinary shares.
The New Shares will grant entitlement to participate in dividends which
it is resolved to distribute to PESCANOVA shareholders as from the
Transaction Date.
b)
Time limit after which entitlement to dividends lapses and an
indication of the person in whose favour the lapse operates.
The returns to which the New Shares give rise will be given effect to in
the manner announced in each case, with the prescription period of the
right of collection being five years in accordance with Section 947 of the
Commercial Code. The beneficiary of prescribed financial rights will be
PESCANOVA.
c)
Dividend restrictions and procedures for non-resident holders.
The COMPANY is not aware of the existence of any restriction on
receipt of dividends by non-resident holders, who will receive their
dividends in the manner described in the previous paragraph, without
prejudice to the withholdings on account of Non-Resident Income Tax
which may be applicable (see section 4.11 of this Securities Note).
Securities Note
26
d)
Dividend rate or method for calculating it, periodicity and
cumulative or non-cumulative nature of payments.
The New Shares, as with the other shares which make up the share
capital, do not incorporate the right to any fixed dividend. Consequently,
the right to the dividend on these shares will arise solely from the time
when the Shareholders General Meeting, or the Board of Directors of
PESCANOVA as the case may be, resolves to distribute corporate
profits.
The New Shares will grant entitlement to participate in interim or final
dividends of the COMPANY which it is resolved to distribute as from
the Transaction Date.
Information rights:
All New Shares grant their holders the right to information set out in general
in Sections 93.d), 297 and 527 of the CCA. They further enjoy the rights
which, as special manifestations of the right to information, are set out in
detail in the provisions of the Companies Act and Act 3/2009, of 3 April, on
structural modifications of mercantile companies, since this relates to a
modification of Articles of Association, increase and reduction in capital,
approval of annual financial statements, issue of debentures, convertible or
otherwise into shares, transformation, merger and demerger, dissolution and
liquidation of the COMPANY, general assignment of assets and liabilities,
international transfer of registered office and other corporate acts or
operations.
Rights of attendance and voting at Shareholders’ General Meetings:
The New Shares grant their holders the right to attend and vote at
Shareholders General Meetings and to challenge corporate resolutions on the
same conditions as the remaining shareholders of the COMPANY, in
accordance with the general regime established by the Capital Companies Act
and the Articles of Association of PESCANOVA. Each New Share will grant
entitlement to one vote.
The Articles of Association of PESCANOVA do not establish a restriction on
the maximum number of votes which can be cast by each shareholder or by
companies belonging to the same group, in the case of legal persons.
Shareholders who so wish can exercise their voting rights remotely, by post
or electronic communication, in accordance with the provisions of Article 30
of the Articles of Association of PESCANOVA.
General Meetings may be attended by shareholders who, individually or in
combination with other shareholders, hold 100 or more PESCANOVA shares.
These shares must be registered in the book entry records of one of the
Participant Entities in IBERCLEAR five (5) days prior to the date set down
Securities Note
27
for holding the Shareholders General Meeting. The document evidencing
compliance with these requirements will be nominative and will have
legitimating effect in relation to the COMPANY.
Preferential subscription rights on offers for subscription for securities of the
same class:
All PESCANOVA shares grant their holders the right of preferential
subscription on the issue of new ordinary or preference shares by
contributions in cash or bonds convertible into shares, all on the terms laid
down in the Capital Companies Act and the Articles of Association of the
COMPANY, and without prejudice to the possibility of total or partial
exclusion of the said right pursuant to resolution of the Shareholders General
Meeting or of the Board of Directors of PESCANOVA on the terms laid
down by Sections 308, 504, 505 and 506 (in the case of capital increase) and
414, 417 and 511 (in the case of issues of convertible bonds) of the CCA.
Furthermore, all PESCANOVA shares grant their holders the right to free
allotment on capital increases charged to reserves, in both cases in accordance
with the provisions of the CCA and related provisions.
Rights to share in any surplus in the event of liquidation:
The holders of the New Shares will be entitled to share in the assets resulting
from liquidation of the COMPANY, in proportion to their nominal value.
Right of separation:
In accordance with the provisions of Sections 346 and 468 of the CCA,
shareholders of the COMPANY will have a right of separation when the
COMPANY resolves to substitute or substantially modify its corporate
objects, on transformation of the COMPANY, transfer of registered office
abroad, a merger which involves the creation of a European joint stock
company domiciled in another Member State, or absorption by a European
joint stock company domiciled in another Member State, provided that the
said shareholders have not voted in favour of the corresponding resolution at
the Shareholders General Meeting.
4.6 Resolutions, authorisations and approvals pursuant to which the securities
have been issued.
Resolutions relating to the Capital Increase
The Capital Increase is made pursuant to the resolutions passed at the
Ordinary Shareholders General Meeting of the COMPANY held on 13 April
2012.
This General Meeting resolved, under item five on the agenda, to authorise
the Board of Directors, with express power of delegation in turn to the
Chairman of the Board of Directors, pursuant to the provisions of Section 297
Securities Note
28
of the CCA, to increase share capital, with or without issue premium, up to
50% of the share capital at the time of the authorisation, on one or more
occasions and at the time and in the amount the same considers suitable,
consequently authorising the Board to modify Article 7 of the Articles of
Association of the COMPANY and rendering without effect the authorisation
resolved by the General Meeting on 30 January 2012.
At its meeting held on 2 July 2012, the Board of Directors of PESCANOVA
resolved to make use of the authorisation granted in its favour by the said
Shareholders’ General Meeting held on 13 April 2012 and to increase the
share capital of PESCANOVA by the issue and placement of the shares
covered by the Capital Increase, i.e. 9,290,464 shares, with a nominal value of
six euros each, of the same class and series as those currently in circulation,
with provision in any event for the possibility of incomplete subscription. The
Capital Increase was resolved with preferential subscription rights in favour
of the PESCANOVA shareholders.
Authorisations
Issue of the New Shares covered by the Capital Increase is subject to the
general regime of approval and registration with the Spanish Securities
Market Commission (Comisión Nacional del Mercado de Valores —
CNMV—), in accordance with the provisions of the Securities Market Act
and its implementing regulations.
4.7 The expected date of issue of the securities.
The expected date for commencement of the subscription period for the New
Shares corresponding to the Capital Increase is 12 July 2012.
At the end of the subscription period, on subscription and payment up of the
Capital Increase, the corresponding notarised public deed will be executed for
subsequent registration in the Pontevedra Commercial Registry, planned for 8
August 2012.
4.8 Description of any restriction on the free transferability of the securities.
There are no restrictions on the free transferability of the shares of the
COMPANY and therefore the New Shares will be fully transferrable in
accordance with the provisions of the CCA, the SMA and their corresponding
implementing regulations which are applicable.
4.9 Existence of any mandatory takeover bids and/or squeeze-out and sell-out
rules in relation to the securities.
No mandatory takeover bid has been launched over the PESCANOVA shares.
Furthermore, there is no special legislation which regulates obligatory offers
for acquisition or mandatory squeeze-out or sell-out of the shares of
PESCANOVA, other than those deriving from legislation on takeover bids
contained in the Securities Market Act and its implementing regulations.
Securities Note
29
4.10 Takeover bids by third parties in respect of the capital of the issuer, which
have taken place during the current and previous financial year.
No takeover bid has been launched with respect to the shares of
PESCANOVA during the financial year ending 31 December 2011 nor
during the financial year in progress.
4.11 Tax considerations.
A general description is provided below, in accordance with Spanish
legislation in force (including its regulatory implementation) at the date of
approval of this Securities Note, of the tax regime applicable to the
acquisition, holding, and subsequent transfer, as the case may be, of the New
Shares.
It must be taken into account that this analysis does not set out all possible tax
consequences of those transactions which could be relevant with respect to a
decision to take part in the Capital Increase, nor the regime applicable to all
categories of investors, some of whom (such as financial institutions,
collective investment undertakings, or cooperatives, for example) may be
subject to special rules. Furthermore, this description also does not take into
account regional tax regimes of Economic Arrangements and Agreements in
force respectively in the Historical Territories of the Basque Country and in
the Region of Navarre, nor the legislation enacted by different Autonomous
Regions which, with respect to certain taxes, may be applicable to investors.
Investors, both Spanish and foreign, wishing to take part in the Capital
Increase, are advised in this respect to consult their lawyers or tax advisors
with a view to determining those tax consequences applicable to their specific
case. Likewise, investors must take into account the changes which current
legislation at the present time may undergo in the future as well as the
interpretation of its content which may be made by Spanish tax authorities,
which could differ from that set out below.
(1) Indirect imposition on the acquisition and transfer of the New Shares
Subscription, and subsequent transfer of the New Shares as the case may
be, will be exempt from the Tax on Capital Transfers and Stamp Duty
and from Value Added Tax, on the terms laid down by Section 108 of the
Securities Market Act and related of laws regulating the taxes referred to.
(2) Direct imposition deriving from holding and subsequent transfer of the
New Shares
Securities Note
30
(i) Shareholders resident in Spanish territory
(a)
Natural Persons
(a.1) Individual Income Tax
(a.1.1) Yields on securities
In accordance with Section 25 of the Individual Income Tax Act,
35/2006 of 28 November (the “Individual Income Tax Act”),
the following, amongst others, will be treated as yields on
securities: dividends, premiums for attending General Meetings,
yields deriving from the creation or assignment of rights or rights
of use or enjoyment over the New Shares and participation in
general in the profits of PESCANOVA as well as any other profit
received from the said entity in their capacity as shareholder.
Yields on securities obtained by shareholders as a result of
ownership of the New Shares will be included at the net yield
resulting from deducting, as the case may be, the expenses of
administration and deposit from the gross amount, but not those
of discretionary and individual portfolio management, in taxable
savings income for the financial year in which they are due to
their recipient, being taxed in the 2012 and 2013 tax periods in
accordance with the provisions of Additional Provision Thirty
Five of the Individual Income Tax Act, introduced by Royal
Decree-Act 20/2011, of 30 December (“RDL 20/2011”), at the
fixed rate of 21% (for the first 6,000 euros of savings income
obtained by the natural person), 25% (for income between 6,001
euros and 24,000 euros) and 27% (for income exceeding 24,000
euros), and no deduction may be applied to avoid double taxation.
However, in accordance with the provisions of letter y) of Section
7 of the Individual Income Tax Act, there will be exemption from
Individual Income Tax ( the “Individual Income Tax”), with a
limit of 1,500 euros annually, in respect of dividends, premiums
for attending General Meetings and participation in the profits in
any type of entity (including participation in the profits of
PESCANOVA), as well as yields from any class of assets, except
delivery of paid up shares which, pursuant to the Articles of
Association or by a decision of corporate bodies, grant
entitlement to participate in the profits of an entity (including
PESCANOVA). This limit will be applicable to the whole of the
dividends and participation in profits obtained during the calendar
year by the Individual Income Tax taxpayer in his capacity as
shareholder or member of any entity.
The said exemption will not be applied to dividends deriving from
securities acquired within the two months prior to the date on
which they have been paid when, subsequent to the said date and
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within the same period, a transfer of homogenous securities takes
place.
Furthermore, in the 2012 and 2013 tax periods, shareholders will
in general be subject to a withholding on account of Individual
Income Tax, in accordance with Additional Provision Thirty Five
of the Individual Income Tax Act, introduced by RDL 20/2011, of
21% of the entire amount of the profit distributed, without taking
into account for these purposes the exemption of 1,500 euros
previously described. The withholding on account will be
deductible from the amount of tax payable and, if it is
insufficient, will give rise to the repayments provided for in
Section 103 of the Individual Income Tax Act.
(a.1.2) Capital gains and losses
Variations in the value of assets of Individual Income Tax
taxpayers which are manifested on the occasion of any alteration
in these assets will give rise to capital gains or losses which, in
the case of transfer for good consideration of the New Shares, will
be quantified at the negative or positive difference, respectively,
between the acquisition value of these securities and their transfer
value, which will be determined (i) by their list value on the date
on which the said transfer takes place, or (ii) the agreed price
when it is higher than the said list value.
Both acquisition value and transfer value will be respectively
increased or reduced by the taxes and expenses inherent in these
transactions which have been paid by the transferee or transferor,
respectively.
Capital gains or losses manifested as a result of transfers of New
Shares carried out by shareholders will be included and set off in
their respective savings tax bases for the year in which the change
in assets takes place, and taxed in 2012 and 2013, in accordance
with Additional Provision Thirty Five of the Individual Income
Tax Act, introduced by RDL 20/2011, if the balance resulting
from the inclusion and set off in the savings tax base is positive,
at the fixed rate of 21% (for the first 6,000 euros of savings
income obtained by the natural person), 25% (for income between
6,001 euros and 24,000 euros) and 27% (for income exceeding
24,000 euros), independently of the period during which it has
been generated.
Capital gains deriving from transfer of New Shares are not subject
to withholding.
Finally, certain losses deriving from transfers of the New Shares
will not be taken into account as losses when homogeneous
securities have been acquired within the two months before or
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after the date of transfer which gave rise to the said loss. In these
cases, capital losses will be included to the extent that the
securities are transferred which still remain in the assets of the
taxpayer.
(a.1.3) Preferential subscription rights
The amount obtained from the sale of preferential subscription
rights over New Shares does not constitute income but reduces
the acquisition costs of the shares from which they derive for the
purposes of future transfers, until this cost is reduced to zero.
Amounts received in excess of the acquisition cost will be treated
as capital gain for the year in which the transfer of the rights has
taken place, being subject to taxation in the 2012 and 2013 tax
periods, in accordance with the provisions of Additional
Provision Thirty Five of the Individual Income Tax Act,
introduced by RDL 20/2011, at the fixed rate of 21% (for the first
6,000 euros of savings income obtained by the natural person),
25% (for income between 6,001 euros and 24,000 euros) and 27%
(for income exceeding 24,000 euros), independently of the period
during which it has been generated.
(a.2) Wealth Tax
In accordance with the provisions of Royal Decree-Act 13/2011,
of 16 September, with effect for the 2012 financial year natural
person shareholders resident in Spanish territory in accordance
with the provisions of Section 9 of the Individual Income Tax Act
are subject to Wealth Tax (“WT”) in respect of the whole of the
net assets which they hold at 31 December in each year,
irrespective of the location of the goods or where rights can be
exercised.
Taxation will take place in accordance with the provisions of the
WT Act, which for these purposes establishes an exempt
minimum of 700,000 euros for the 2012 financial year, in
accordance with a tax scale with marginal rates varying between
0.2% and 2.5%, all without prejudice to specific legislation
enacted, as the case may be, by each Autonomous Region.
Those natural persons resident for tax purposes in Spain who
subscribe for New Shares pursuant to this Capital Increase and
who are obliged to file a WT return, must declare the New Shares
which they hold at 31 December in each year, which will be
computed in accordance with the average trading value of the
fourth quarter of the year. The Ministry of Finance and Public
Administration publishes this average trading value each year for
the purposes of this tax.
(a.3)
Securities Note
Inheritance and Gift Tax
33
Transfers of shares without consideration (on death or by gift) in
favour of natural persons resident in Spain are subject to
Inheritance and Gift Tax (“IGT”) on the terms laid down by Act
29/1987, of 18 December, with the taxpayer being the person
acquiring the securities, and without prejudice to specific
legislation enacted, as the case may be, by each Autonomous
Region. The tax rate applicable to the tax base varies between
7.65% and 34%; after the amount of tax is obtained, certain
multipliers are applied to it based on the pre-existing wealth of
the taxpayer and his degree of relationship with the donor or
deceased, which can finally give rise to an effective tax rate
which will vary between 0% and 81.6% of the tax base.
(b)
Corporate Income Tax Taxpayers
(b.1)
Dividends
Corporate Income Tax (“CIT”) taxpayers or those who, being
taxpayers for Non-Resident Income Tax (“NRIT”), act in Spain
through a permanent establishment, must include in their tax base
the entire amount of dividends or participation in profits received
as a result of owning the securities subscribed for, as well as the
expenses inherent in the holding, in the manner laid down by
Section 10 and following of the Revised Text of the Corporate
Income Tax Act, enacted by Royal Legislative Decree 4/2004, of
5 March (the “CIT Act”), in general paying tax at the rate of
30%.
Provided that none of the grounds for exclusion apply laid down
by Section 30 of the CIT Act, taxpayers for this tax will be
entitled to a deduction of 50% of gross tax corresponding to the
tax base deriving from dividends or participation in profits
obtained, for which purposes it must be taken into account that
the tax base is the entire amount of these dividends or
participation in profits.
The foregoing deduction will be 100% when, on compliance with
the remaining requirements laid down by legislation, the
dividends or participation in profits derive from a direct or
indirect holding of at least 5% of capital, and provided that the
latter has been held without interruption during the year prior to
the day on which the profit which is distributed is due or, in
default, it is held during the time necessary to complete the year.
Under certain conditions, this deduction will also be applicable in
cases in which this percentage holding of 5% has been held but,
however, without the whole of the holding being transferred, the
percentage ownership has been reduced to a minimum of 3% as a
result of the entity held having carried out (i) an operation subject
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to the special tax regime established in Chapter VIII of Title VII
of the CIT Act, or (ii) an operation in the field of public takeover
bids.
Furthermore, in the 2012 and 2013 tax periods, CIT taxpayers
will be subject to a withholding on account of this tax in
accordance with the provisions of Additional Provision Fourteen
of the CIT Act, introduced by RDL 20/2011, of 21% of the entire
amount of the profit distributed, unless any of the exclusions from
withholding laid down by current legislation are applicable to
them, which include possible application of the double taxation
deduction of 100% of dividends received, in which case, provided
that the minimum holding period of one year has been complied
with without interruption, no withholding will be made. The
withholding made will be deductible from the amount of CIT and,
if it is insufficient, will give rise to the repayments laid down in
Section 139 of the CIT Act.
(b.2)
Income deriving from transfer of the securities
The profit or loss deriving from transfer with or without
consideration of the New Shares, or from any other change in
assets relating to them, will be included in the tax base for CIT
taxpayers or NRIT taxpayers who for these purposes act through a
permanent establishment in Spain, in the manner laid down by
Section 10 and following of the CIT Act, being in general taxed at
the rate of 30%.
The income deriving from transfer of the New Shares will not be
subject to withholding.
Furthermore, on the terms laid down by Section 30.5 of the CIT
Act, transfer of New Shares by taxpayers for this tax may grant to
the transferor the right to apply the double taxation deduction and,
as the case may be, will enable it to enjoy the deduction for
reinvestment of extraordinary profits, in accordance with the
provisions of Section 42 of the CIT Act, for that part of the
income which has not benefitted from the double taxation
deduction, provided that the requirements contained in this
section are fulfilled.
Finally, in the case of free acquisition of New Shares by a CIT
taxpayer, the income generated by it will likewise be taxed in
accordance with the rules of this tax and the Inheritance and Gift
Tax will not be applicable.
(ii) Shareholders not resident in Spanish territory
This section examines the tax treatment applicable to shareholders
not resident in Spanish territory who have the status of effective
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beneficiaries of the securities, excluding those who act in Spanish
territory through a permanent establishment, the tax regime of
whom was described together with that of CIT taxpayer
shareholders.
Natural persons will be considered non-resident shareholders who
are not Individual Income Tax taxpayers as well as entities not
resident in Spanish territory in accordance with the provisions of
Section 6 of the Revised Text of the Non-Resident Income Tax
Act, promulgated by Royal Legislative Decree 5/2004, of 5
March (the “NRIT Act”).
The regime which is described below is of a general nature, and
therefore the particular features of each taxpayer must be taken
into account and those which may result from Double Taxation
Treaties (“DTT”) entered into between third party countries and
Spain.
(a)
Non-Resident Income Tax
(a.1)
Yields on securities
Dividends and other yields deriving from participation in the own
funds of an entity, obtained by natural or legal persons not
resident in Spain who act for these purposes without a permanent
establishment in the said territory, will in the 2012 and 2013 tax
periods be subject to taxation for NRIT at the general tax rate of
21% of the entire amount received, in accordance with the
provisions of Additional Provision Three of the NRIT Act,
introduced by RDL 20/2011.
Nevertheless, dividends and participation in profits referred to in
the previous section (a.1.1) will be exempt, which are obtained
without the mediation of a permanent establishment in Spain, by
natural persons resident for tax purposes in the European Union
or in countries or territories with which there is an effective
exchange of tax information, with a limit of 1,500 euros,
computable during each calendar year. This exemption will not be
applicable to the yields obtained through countries or territories
classified by regulations as tax havens.
This limit will be applicable to the whole of the dividends and
participation in profits obtained during the calendar year by the
NRIT taxpayer as a result of being shareholder or member of any
type of entity. This exemption will not be applied when the
dividends or participation in profits derives from securities
acquired within the two months prior to the date on which they
have been paid when, after that date, within the same period, a
transfer takes place of homogenous securities.
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In general, the COMPANY will, at the time of payment of the
dividend, in the 2012 and 2013 tax periods make a withholding on
account of NRIT of 21% in accordance with the provisions of
Additional Provision Three of the NRIT Act, introduced by RDL
20/2011.
However, when pursuant to tax residency of the recipient a DTT
entered into by Spain or internal exemption is applicable, the
reduced tax rate will be applied, as appropriate, laid down in the
DTT for this type of income or exemption, on prior accreditation
of the tax residence of the shareholder in the manner established
in current legislation. For these purposes, at the present time a
special procedure is in force, approved by Order of the Ministry
of Economy and Finance of 13 April 2000, to give effect to
withholdings from non-resident shareholders, at the
corresponding rate in each case, or to exclude the withholding,
when in the payment procedure financial institutions are involved
which are domiciled, resident or represented in Spain, which are
depositaries or manage the receipt of income from the said
securities.
In accordance with this rule, at the time of distributing the
dividend, PESCANOVA will make a withholding from the entire
amount of the dividend at the rate of 21% and will transfer the
amount to the depository institutions. The depository institutions
which, in turn, evidence in the manner established the right to
apply reduced rates or the exclusion of withholdings from their
customers (for which they must provide the depository before the
10th of the month following that in which the dividend is
distributed, with a certificate of tax residence issued by the tax
authority of their country of residence, which, as the case may be,
must expressly record that the investor is resident within the
meaning defined in the DTT which is applicable; or, in those
cases in which a tax limit is applied laid down in a DTT
implemented by an Order establishing the use of a specific form,
this form instead of certificate) will immediately receive for
crediting to them the excess amount withheld. The certificate of
residence previously mentioned is valid for these purposes in
general for one year from its date of issue.
When an exemption is applicable or, by application of a DTT, the
withholding rate is less than 21%, and the shareholder has not
been able to evidence his residence for tax purposes within the
period established for the purpose, the former may apply to the
Tax Office for repayment of the excess amount withheld subject
to the procedure and model declaration laid down by Order
EHA/3316/2010, of 17 December 2010. Shareholders are advised
to consult their advisors regarding the procedure to be followed in
each case in order to apply for the said repayment from the
Spanish Tax Office.
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The procedure set out in the Order of the Ministry of Economy
and Finance of 13 April 2000 previously described, will not be
applicable with respect to dividends or participation in profits
which, with a limit of 1,500 euros, is exempt from taxation for
NRIT on the terms previously indicated. In this case
PESCANOVA will at the time of paying the dividend make a
withholding on account of NRIT of 21% and the shareholder can,
as appropriate, apply to the Tax Office for repayment of the
excess amount withheld subject to the procedure laid down in
Order EHA/3316/2010, of 17 December 2010.
In any event, after making the withholding on account of NRIT or
on acknowledgement of the exemption, non-resident shareholders
will not be obliged to submit a return in Spain for NRIT.
Investors are advised to consult their lawyers or tax advisors
regarding the procedure to be followed in each case in order to
apply for the said repayment from the Spanish Tax Office.
(a.2)
Capital gains and losses
In accordance with the NRIT Act, capital gains obtained by nonresident natural persons or entities without the mediation of a
permanent establishment in Spain from the transfer of securities
or any other capital gain related to the said securities, will be
subject to taxation for NRIT which will be quantified in general
in accordance with the rules laid down in the Individual Income
Tax Act. In particular, capital gains deriving from the transfer of
shares will be taxed for NRIT, in the 2012 and 2013 tax periods,
at the rate of 21% in accordance with the provisions of Additional
Provision Three of the NRIT Act, introduced by RDL 20/2011,
unless an internal exemption or DDT entered into by Spain is
applicable, in which case the provisions will apply of the said
DDT.
In this respect, the following capital gains will be exempt by
application of Spanish internal law:
Securities Note
(i)
Those deriving from transfers of the New Shares in
Spanish official secondary securities markets obtained
without the mediation of a permanent establishment in
Spain by natural persons or entities resident in a State
which has entered into a DDT with Spain with an
information exchange clause, provided that they have not
been obtained through countries or territories classified by
regulations as tax havens.
(ii)
Those deriving from transfer of New Shares obtained
without the mediation of a permanent establishment in
38
Spain by natural persons or entities resident for tax
purposes in another European Union Member State or
through permanent establishments of such residents
situated in another European Union Member State,
provided that they have not been obtained through
countries or territories classified by regulations as tax
havens. The exemption does not extend to the capital gains
deriving from the transfer of shares or rights in an entity
when (i) the assets of the said entity consist principally,
directly or indirectly, of real estate situated in Spanish
territory, or (ii) at any time during the 12 months prior to
the transfer the taxpayer has had a direct or indirect
holding of at least 25% in the capital or equity of the
Issuer.
The capital gain or loss will be calculated and subject to taxation
separately for each transfer, and it is not possible to set off gains
and losses in the event of more than one transfer with results in
different directions. They will be quantified by applying the rules
of Section 24 of the NRIT Act.
In accordance with the provisions of the NRIT Act, capital gains
obtained by non-residents without the mediation of a permanent
establishment will not be subject to withholding or payment in on
account of NRIT.
The non-resident shareholder will be obliged to submit a return
determining, and paying in as the case may be, the corresponding
tax debt. The return and payment in may also be made by their tax
representative in Spain or depository or manager of the shares,
subject to the procedure and model return provided in Order
EHA/3316/2010, of 17 December 2010.
If an exemption is applicable, whether pursuant to Spanish law or
a DTT, the non-resident investor must evidence his right by
providing a certificate of tax residence issued by the
corresponding tax authority of his country of residence (in which,
as the case may be, it must expressly record that the investor is
resident in the said country within the meaning defined in the
DTT which is applicable) or the form provided in the Order
implementing the DTT which is applicable. This certificate of
residence in general for these purposes is valid for one year from
its date of issue.
(b)
Wealth Tax
Without prejudice to the result of DTTs entered into by Spain, in
accordance with the provisions of Royal Decree-Act 13/2011, of
16 September, and with effect for the 2012 financial year, natural
persons are subject to WT who do not have their normal residence
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in Spanish territory in accordance with the provisions of Section 9
of the Individual Income Tax Act and who are holders on 31
December in each year of the said years of property located in
Spanish territory or rights which can be exercised or must be
performed therein. These property or rights will be taxed for WT,
although taxpayers may make the corresponding reduction
corresponding to the exempt minimum in the amount of 700,000
euros, applying the general tax scale to them, the marginal rates of
which vary for 2012 between 0.2% and 2.5%.
The Spanish authorities have held that the shares of a Spanish
company must be considered property located in Spain for tax
purposes in each case.
If WT taxation is appropriate, the New Shares owned by nonresident natural persons which are admitted to trading on a
Spanish official secondary securities market will be computed at
the average quotation price for the fourth quarter of each year.
The Ministry of Finance and Public Administration each year
publishes this average quotation price for the purposes of this tax.
(c)
Inheritance and Gift Tax
Without prejudice to the results of DTTs entered into by Spain,
acquisitions without good consideration by natural persons nonresident in Spain, and wherever the residence of the transferor,
will be subject to IGT when the acquisition is of goods situated in
Spanish territory or rights which can be exercised or must be
performed in that territory. The Spanish tax authorities have held
that the shares of a Spanish company must be considered as
property located in Spain for tax purposes in each case.
Companies not resident in Spain are not taxpayers for this tax and
the income which they obtain without good consideration will
generally be taxed as capital gains in accordance with the NRIT
rules previously described, without prejudice to the provisions of
DTTs which may be applicable.
Non-resident shareholders are advised to consult their tax
advisors regarding the terms on which IGT must be applied in
each specific case.
Securities Note
40
5.
TERMS AND CONDITIONS OF THE CAPITAL INCREASE
5.1 Conditions, statistics, expected timetable and procedure for subscription for
the securities.
5.1.1
Conditions to which the Capital Increase is subject.
The Capital Increase is not subject to any type of condition.
5.1.2
Total amount of the Capital Increase.
The Capital Increase pursuant to which the New Shares will be issued
has a nominal amount of 55,742,784 euros and will take place by issue
and allocation of 9,290,464 newly issued ordinary shares of the
COMPANY, with a nominal value of six euros each and of the same
class and series as those currently in circulation. The New Shares will be
issued at an issue premium of 7.45 euros per share, which means a total
issue premium of 69,213,956.80 euros, and an issue price of 13.45 euros
per New Share (the “Subscription Price”).
In any event, the resolution to increase share capital, pursuant to which
the New Shares will be issued and which was referred to in section 4.6 of
this Securities Note, expressly provided for the possibility of incomplete
subscription, and therefore in the event that the Increase is not subscribed
for in full within the period established for subscription, the capital will
be increased in the amount of subscriptions effectively made. At the end
of the subscription period, the Board of Directors, or by delegation the
Chairman of the Board of Directors, will determine the definitive amount
of the Increase, which will be announced to the market as soon as
possible through a publication of the corresponding price-sensitive
information notice (hecho relevante or relevant fact) which will be sent
to the Spanish Securities Market Commission (CNMV).
In the event that the New Shares are subscribed for in full at the
Subscription Price, the total cash amount of the Capital Increase (nominal
amount and issue premium) will be 124,956,740.80 euros and the New
Shares would represent 47.77% of the share capital of the COMPANY
before the Capital Increase and 32.33% after the Capital Increase.
5.1.3 Subscription period, including any possible modification, of the Capital
Increase and description of the application process.
1. First round: Preferential Subscription Period
The New Shares are issued with acknowledgement of preferential
subscription rights of the current shareholders of the COMPANY (other
than the COMPANY itself) which are accredited as such in accordance
with the book records of IBERCLEAR at 23:59 hours Madrid time on the
day prior to commencement of the preferential subscription period (the
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“Preferential Subscription Period”), who may exercise their right of
preferential and proposal subscription with respect to all of the shares
issued, in the proportion of 1 New Share for each 2 shares of the
COMPANY in circulation which they hold.
It is recorded that the COMPANY is holder of a total of 88,460 own
shares, representing 0.45% of share capital, to which, in accordance with
Section 148 of the Capital Companies Act, no preferential subscription
rights will be assigned for preferential subscription for New Shares of the
Capital Increase. Furthermore, on 20 June 2011 the COMPANY notified
by relevant fact entry on the same date into an equity swap agreement
with Commerzbank AG in respect of 777,866 shares of the COMPANY,
representing 3.99% of PESCANOVA share capital.
The term of this contract was fixed at 6 months, renewable, and it was
last renewed in June 2012, maturing in the absence of further renewal on
23 December 2012, and is therefore in force at the date of this Securities
Note.
At maturity Commerzbank AG will undo its cover and the party resulting
debtor must settle in cash with the other the difference in sale value of
the cover in the market from the initial purchase value of the shares (30
euros, as notified to the market in the aforesaid relevant fact of 20 June
2012).
On the basis of the terms and conditions of this agreement, the said
shares can be treated, for the purposes of not acknowledging right of
preferential subscription, as direct holding of own shares by the
COMPANY itself (insofar as Commerzbank AG has covered the
financial risks inherent in these shares). Consequently, one and other
shares have been deducted from the total number of shares in circulation
for the ratio of 1 New Share for each 2 shares in circulation of the
COMPANY.
It is further recorded that no company controlled by PESCANOVA is
holder of shares of the COMPANY.
The Board of Directors has resolved that the shares referred to in the
previous paragraphs will not be the subject of purchase and sale
transactions during the period between the date of passing the Capital
Increase resolution and the final date of the Discretionary Allotment
Period (as this term is subsequently defined).
The Preferential Subscription Period for shareholders and investors
acquiring preferential subscription rights (the “Acquirers of Rights”)
will begin on the day following that of publication of the resolution of the
Board of Directors of 2 July 2012 relating to the Capital Increase by issue
and placement into circulation of the New Shares in the Commercial
Registry Official Gazette (Boletín Oficial del Registro Mercantil —
“BORME”—), i.e. 12 July 2012 and will end when 15 calendar days
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42
have elapsed, i.e. on 26 July 2012.
During the Preferential Subscription Period, shareholders and Acquirers
of Rights may, at the time of exercising their preferential subscription
rights, in addition, and on an unconditional and irrevocable basis, apply
for subscription of shares of the COMPANY in the event that at the end
of the Preferential Subscription Period remain shares which are not
subscribed for in exercise of preferential subscription rights (“Additional
Shares”), and therefore the total amount of this Capital Increase has not
been covered.
In order to exercise the preferential subscription rights and, as the case
may be, apply to subscribe for Additional Shares, shareholders and/or
Acquirers of Rights must approach the Participant Entity in
IBERCLEAR in whose book records the preferential subscription rights
are recorded (which in the case of shareholders would be the Participant
Entity in which they have deposited the shares which grant them the said
rights), indicating their desire to exercise their right of preferential
subscription and, as the case may be, to apply for subscription for shares
in the Additional Allotment Period (as this term is subsequently defined).
Orders given relating to exercise of preferential subscription rights will
be deemed to be made on a firm, irrevocable and unconditional basis and
will mean subscription for the New Shares to which they relate. Orders
relating to applying for Additional Shares must be made in a particular
amount, will not be subject to a quantitative limit and will also be
deemed to be made on a firm, irrevocable and unconditional basis,
without prejudice to the fact that they may not be fulfilled in whole on
application of the rules for allotment of Additional Shares described in
the following section 5.1.3.(2). As described in this section, the
Additional Shares allotted to shareholders and/or Acquirers of Rights
who have requested them will be deemed to be subscribed for during the
Additional Allotment Period.
After publication in the BORME of the announcement relating to the
Capital Increase, the Agent shall send, through IBERCLEAR, a notice to
all Participant Entities informing them of the periods for issue of the New
Shares, and of the possible existence of a second round (Additional
Allotment Period) and of a third round (Discretionary Allotment Period).
Subscription rights will be negotiable in the Stock Exchange
Interconnection System (Continuous Market).
Preferential subscription rights not exercised will be extinguished
automatically on completion of the Preferential Subscription Period.
The result of subscription relating to the Preferential Subscription Period
will be notified by the Agent to Participant Entities and to the
COMPANY in order that the latter can give notice of these results to the
CNMV through the corresponding relevant fact.
Securities Note
43
2. Second round: Additional Allotment Period
In the event that after completion of the Preferential Subscription Period
New Shares remain without being subscribed for, such Additional Shares
will be allotted to those shareholders and/or Acquirers of Rights who
have applied for them during the Preferential Subscription Period (the
“Additional Allotment Period”).
For these purposes, by no later than 18:00 hours Madrid time on the
fourth business day following the date of completion of the Preferential
Subscription Period, the Agent shall inform PESCANOVA of the exact
number of Additional Shares for allotment to those shareholders and/or
Acquirers of Rights who have applied for them. It is expected that the
allotment of Additional Shares will take place on 1 August 2012.
The possibility of allotment of Additional Shares in this Additional
Allotment Period is therefore subject to:
a)
The existence of remaining New Shares after exercise of their rights
by shareholders and/or Acquirers of Rights at the end of the
Preferential Subscription Period.
b)
An indication in the order for subscription sent to Participant
Entities during the Preferential Subscription Period, of an intention
to subscribe for Additional Shares in the Additional Allotment
Period.
c)
Exercise by the shareholder and/or Acquirer of Rights applying of
all the preferential subscription rights of which the same is holder
during the Preferential Subscription Period. For these purposes
Participant Entities will be responsible for verifying that the
shareholders and/or Acquirers of Rights who apply for Additional
Shares have exercised all the preferential subscription rights of
which the Participant Entities are aware correspond to them.
In the event that the total number of Additional Shares applied for in the
Preferential Subscription Period for allotment in the Additional
Allotment Period exceeds the number of New Shares which remain
without being allotted pursuant to exercise of preferential subscription
rights, the Agent shall make a pro rata distribution amongst applicants
for Additional Shares in proportion to the percentage which the number
of Additional Shares applied for by each applicant bears to the total
volume of Additional Shares requested.
To this end the Agent will calculate the number of Additional Shares
which will correspond to each applicant for Additional Shares applying
the coefficient resulting from dividing the Additional Shares available by
the total Additional Shares applied for.
Securities Note
44
The coefficient which will be used for the proportional allotment
indicated will be rounded down to three (3) decimal places (i.e. 0.098983
to 0.098). In the case of fractions on allotment, they will be rounded
upwards such that there is a whole number of New Shares.
If, after application of the pro rata distribution referred to in the previous
paragraphs, there are New Shares not allotted as a result of the effect of
rounding down, these will be distributed one by one in order of greater to
lesser quantity of the application for Additional Shares and, in the case of
equality, in alphabetical order of shareholders and/or Acquirers of Rights
who have made the said applications, taking the first position in the field
“First and Last Names or Company Name”, whatever the content thereof,
as from letter “A”.
In no event shall more New Shares be allotted to shareholders or
Acquirers of Rights than they have applied for.
Communications by Participant Entities to the Agent in relation to the
Preferential Subscription Period and the Additional Allotment Period
Participant Entities must notify the Agent by e-mail or, in default, by
facsimile, daily during the Preferential Subscription Period of the total
number of New Shares subscribed for in exercise of preferential
subscription rights and the total number of Additional Shares applied for,
in all cases on cumulative terms from commencement of the Preferential
Subscription Period.
Furthermore, Participant Entities must notify reserves of the total volume
of subscriptions made with them indicating to the Agent for information
purposes the number of New Shares subscribed during the Preferential
Subscription Period and, separately, the total number of Additional
Shares for which subscription is applied for.
Finally, Participant Entities must send to the Agent the electronic file
transfers, or in default magnetic media, with information regarding the
New Shares subscribed for in the Preferential Subscription Period and the
Additional Shares applied for by no later than 12:00 Madrid time on the
fourth business day following the end of the Preferential Subscription
Period, i.e. on 1 August 2012, which must comply with the specifications
of Section 61, format A1, of the Manual of Operations with Issuers of the
Spanish Banking Association (“AEB”), in 120 position format,
incorporating the modifications introduced by AEB Circulars 857 and
875, following the operating instructions which have been established for
the purpose by the Agent.
The Agent may not accept those communications from Participant
Entities which have been transmitted on a date or time after that
indicated, or those which do not comply with any of the requirements
required in this Securities Note or in current legislation, without any
liability on its or PESCANOVA’s part and without prejudice to the
Securities Note
45
possible liability which the infringing Participant Entity may incur to
holders of orders submitted in due time and manner to the said
Participant Entity.
The result of the subscription corresponding to the Preferential
Subscription Period and Additional Allotment Period will, as the case
may be, be notified by the Agent to the Participant Entities and to the
COMPANY in order that the latter can give notice of this result to the
CNMV by the corresponding relevant fact.
The Agent shall notify Participant Entities through which the respective
applications have been made for subscription for New Shares in the
Additional Allotment Period of the number of Additional Shares allotted
to subscribers, which will foreseeably take place on the final day of the
Additional Allotment Period, and in no event later than the following
business day, i.e. in accordance with the expected timetable, on 2 August
2012.
The Additional Shares allotted to subscribers during the Additional
Allotment Period will be deemed to be subscribed for during the said
Period.
3. Third round: Discretionary Allotment Period
In the event that the New Shares subscribed for during the Preferential
Subscription Period (including the shares subscribed for by the
shareholders referred to in the following section 5.2.2), together with the
Additional Shares assigned to subscribers, are not sufficient to cover the
whole of the New Shares covered by this Capital Increase (the difference
between the total New Shares and the sum of those subscribed for in the
Preferential Subscription Period and in the Additional Allotment Period
is referred to as the “Discretionary Allotment Shares”), the Agent shall
give notice thereof to the COMPANY and the Underwriters by no later
than 18:00 hours Madrid time on the fourth business day following the
end of the Preferential Subscription Period.
In this case a discretionary allotment period will begin for these shares
after completion of the Additional Allotment Period which will be for a
maximum duration of one business day, beginning on 18:00 hours
Madrid time on the fourth business day after the end of the Preferential
Subscription Period and ending on the fifth business day after the said
end (forecast for 2 August 2012) (the “Discretionary Allotment
Period”). If the Discretionary Allotment Period is opened,
PESCANOVA will give notice thereof to the CNMV by communication
of relevant fact.
Without prejudice to the foregoing provisions, if after the end of the
Additional Allotment Period, Discretionary Allotment Shares exist, the
Global Coordinator, acting on behalf of the Underwriters, may decide at
any time during the Discretionary Allotment Period on subscription by
Securities Note
46
the Underwriters directly for the Discretionary Allotment Shares in
proportion to their respective underwriting commitments, subject to the
limit stipulated in the following section 5.4.3, and at the Subscription
Price, bringing the Capital Increase to an early end. In this case, the date
of closing and payment up of the Capital Increase provided in the
tentative timetable in the following section 5.1.3.(5) may be brought
forward.
Commencement of the Discretionary Allotment Period will be subject to
subscription and payment by the shareholders indicated in the following
section 5.2.2 of, overall, a minimum cash amount of 25,000,012.65
euros, by subscription and payment up in respect of 1,858,737 New
Shares, representing approximately 20% of the total New Shares issued
pursuant to the Capital Increase, within the first three business days of
the Preferential Subscription Period. Compliance with this commitment
will be notified to the market through a relevant fact on the same date on
which it takes place.
During the Discretionary Allotment Period the Underwriters (as the said
term is subsequently defined) will engage in activities of active
promotion and dissemination in order to obtain proposals for subscription
in respect of the Discretionary Allotment Shares from persons who have
the status of qualified investors in Spain, as the said term is defined in
Section 39 of Royal Decree 1310/2005, of 4 November, or who have the
status of qualified investors outside Spain in accordance with applicable
legislation in each country (the “Investors”), such that in accordance
with applicable legislation subscription and payment up of the New
Shares does not require any approval or registration, other than those
expressly provided in this Securities Note.
Subscription proposals must be firm and irrevocable and include the
number of Discretionary Allotment Shares which each Investor is
prepared to subscribe for at the Subscription Price, without prejudice to
ceasing to have effect in the event of termination of the Underwriting
Agreement.
The Underwriters who receive proposals for subscription for
Discretionary Allotment Shares must give notice to the Agent on behalf
of their principals of the total volume of proposals for subscription for
Discretionary Allotment Shares made to them, on the last date of the
Discretionary Allotment Period (i.e. 2 August 2012). The Agent shall in
turn inform the COMPANY of the said total volume.
Notwithstanding the foregoing, PESCANOVA by mutual agreement with
the Global Coordinator, may declare that the Discretionary Allotment
Period has ended at any time prior to its termination provided that the
Capital Increase has been subscribed in full.
During the Discretionary Allotment Period, the Chairman of the Board of
Directors of the COMPANY, after hearing the opinion of the Global
Securities Note
47
Coordinator, pursuant to the delegation granted for these purposes by the
Board of Directors at its meeting held on 2 July 2012, shall evaluate the
proposals submitted, applying criteria of quality and stability of
investment, and may reject or accept proposals for subscription
submitted, in whole or in part, in his discretion and without the need to
give reasons, but acting in good faith and ensuring that no unjustified
discrimination takes place between proposals of the same ranking and
characteristics. Notwithstanding the foregoing, the COMPANY may not
reject proposals for subscription if this means that the Underwriters must
meet their respective underwriting commitments.
The COMPANY shall give notice of definitive allocation of the
Discretionary Allotment Shares to the Agent on the final day of the
Discretionary Allotment Period (i.e. 2 August 2012). The Agent shall in
turn immediately notify this allotment to the Underwriters, who in turn
will notify it to the Investors. After notifying allocations of Discretionary
Allotment Shares to the Investors, their proposals will automatically be
converted into firm subscription orders, unless prior to the date of
payment up of the New Shares subscribed for in the Discretionary
Allotment Period (initially planned for 7 August 2012, as described in the
following section 5.1.8 – (the “Disbursement date”) termination of the
Underwriting Agreement takes place, in which case they would be
automatically revoked.
As described in section 5.4.3 of this Securities Note, an underwriting and
placement agreement was signed between the COMPANY, as issuer,
with BNP Paribas (“BNP Paribas”) which will act as Global
Coordinator and Sole Bookrunner of the Capital Increase, and with
Banco BPI, S.A. (jointly with BNP Paribas, the “Underwriters”), in
relation to underwriting approximately 64% of the New Shares
(deducting the commitments referred to in section 5.2.2 of the Securities
Note, approximately 16% of the Capital Increase not being underwritten)
(the “Underwriting Agreement”).
Consequently, in the event that after the Discretionary Allotment Period
has elapsed, the sum of New Shares subscribed for by subscribers in the
Preferential Subscription Period and in the Additional Allotment Period
and, as the case may be, by the Investors in the Discretionary Allotment
Period, is less than 84% of the total number of New Shares, the
Underwriters undertake on their own name and behalf to subscribe for
and pay up the New Shares the subscription of which corresponds to
them in exercise of their respective underwriting commitments in the
amounts and in the proportions and subject to the limits indicated in the
following section 5.4.3.
The foregoing commitments are conditional, in accordance with the
following section 5.2.2, on the significant shareholders who are also
directors of PESCANOVA or proposed the appointment of proprietary
directors, having subscribed for and paid up, by no later than the third
business day of the Preferential Subscription Period, an overall cash
Securities Note
48
amount of at least 25,000,012.65 euros by subscription and payment up
of 1,858,737 New Shares, representing approximately 20% of the New
Shares in exercise of preferential subscription rights in the context of the
Capital Increase. Compliance with this commitment shall be notified to
the market by relevant fact on the same date on which it takes place.
The Underwriters must send to the Agent the electronic transfers of files,
or in default magnetic media, with information on proposals for
subscription of Discretionary Allotment Shares allocated, which must
comply with the specifications of Section 61, format A1, of the Manual
of Operations with Issuers of the Spanish Banking Association
(Asociación Española de Banca —“AEB”—), in 120 position format,
incorporating the modifications introduced by AEB Circulars 857 and
875, by no later than 12:00 hours Madrid time on the business day
following that of the end of the Discretionary Allotment Period, i.e. 3
August 2012.
Payment up in full of the Subscription Price of each New Share
subscribed for during the Discretionary Allotment Period must take place
in accordance with the provisions of the following section 5.1.8.
4. Early closing of the Capital Increase
Notwithstanding the previous sections, the COMPANY may at any time
treat the Capital Increase as completed early, after the Preferential
Subscription Period or Additional Allotment Period has concluded,
provided that the Capital Increase has been subscribed in full.
Furthermore, if after the end of the Additional Allotment Period
Discretionary Allotment Shares exist, the Global Coordinator acting on
behalf of the Underwriters may decide at any time during the
Discretionary Allotment Period on direct subscription by the
Underwriters for the Discretionary Allotment Shares, within the limits
laid down in the following section 5.4.3 in proportion to their respective
underwriting commitments and at the Subscription Price, closing the
Capital Increase early. In this case the dates for closing and payment up
of the Capital Increase provided in the tentative timetable in the
following section 5.1.3.(5) may be brought forward.
Without prejudice to the foregoing, if after the Preferential Subscription
Period, or of the Additional Allotment Period, as the case may be, and/or
the Discretionary Allotment Period, there has not been subscription for
the full amount of the Capital Increase as a result of termination of the
Underwriting Agreement as a result of non-subscription for part of the
Increase not underwritten, or because the underwriting obligations
thereunder have not come into force, the Board of Directors, or by
delegation therefrom, the Chairman of the Board of Directors, may
declare incomplete subscription of the Capital Increase.
Securities Note
49
5. Tentative timetable of the Capital Increase
A tentative timetable is shown below of the Capital Increase:
Forecast Timetable for the Capital Increase
Stage/Action
Estimated date
Approval and registration of the Securities Note by the CNMV............
10 July 2012
Publication of the announcement in the BORME ..................................
11 July 2012
Commencement of the Preferential Subscription Period and of
application for Additional Shares ...........................................................
12 July 2012
End of the Preferential Subscription Period and for application of
Additional Shares ...................................................................................
26 July 2012
Additional Allotment Period ..................................................................
1 August 2012
Relevant fact reporting on the result of the Preferential Subscription
Period and of the Additional Allotment Period ......................................
1 August 2012
Commencement, as the case may be, of the Discretionary Allotment
Period .....................................................................................................
1 August 2012
Payment up of the shares subscribed for in the Preferential
Subscription Period and in the Additional Allotment Period .................
2 August 2012
Completion, as the case may be, of the Discretionary Allotment
Period .....................................................................................................
2 August 2012
Payment up of shares subscribed for in the Discretionary Allotment
Period .....................................................................................................
7 August 2012
Resolution to execute the Capital Increase/relevant fact
(“Transaction Date”) ............................................................................
7 August 2012*
Execution of notarised public deed of Capital Increase .........................
7 August 2012
Registration of the notarised deed of Capital Increase in the
Commercial Registry .............................................................................
8 August 2012
Allocation by IBERCLEAR of registry reference corresponding to
the New Shares subscribed.....................................................................
9 August 2012
Commencement of listing of the New Shares ........................................
15 August 2012
*In the event that the Discretionary Allotment Period is not commenced since no surplus
shares remain unsubscribed after the Preferential Subscription Period and the Additional
Allotment Period, the Transaction Date would be brought forward to 2 August 2012, and
consequently bringing forward the rest of the timetable.
It is recorded that the periods previously indicated may not be complied with
and consequently execution of the actions described may be delayed, which,
if it occurs, will be notified by the COMPANY by relevant fact.
5.1.4 Circumstances in which the Capital Increase may be revoked or
suspended and whether revocation may take place after dealing has begun.
No grounds have been provided for withdrawal or revocation of the Capital
Increase covered by this Securities Note, outside those which may result
from application of the law or compliance with a judicial or administrative
order.
Securities Note
50
It is recorded that the force and effect of the Underwriting Agreement
executed by PESCANOVA is subject to a series of terms and conditions
normal in this type of transaction, which include that the underwriting
obligations of the Underwriters shall be terminated and, as the case may be,
applications for Discretionary Allotment Shares rendered without effect, by
unanimous decision of the Underwriters in the event that at any time from its
signature and until execution of the deed of Capital Increase (initially
planned for 7 August 2012, as described in the following section 5.1.8 (the
“Disbursement Date”), any circumstances arise of force majeure (events
which are described in the following section 5.4.3 of this Securities Note)
which in the unanimous opinion of the Underwriters make it impracticable
or unadvisable to continue with the Capital Increase.
Even if the agreement is terminated of grounds of force majeure or does not
come into force as a result of failure to comply with any of the conditions
laid down, the shareholders and Acquirers of Rights who exercise their
preferential subscription rights may not revoke subscriptions made. Neither
may applications for Additional Shares already made be revoked.
Notwithstanding the foregoing, if the Underwriting Agreement is terminated
on or before 9:00 hours Madrid time on the day of publication of the
announcement of the Capital Increase in the BORME (which is planned to
occur on 11 July 2012), the Company may decide not to carry out the Capital
Increase or, alternatively, continue with the Capital Increase without
underwriting, in which case the Capital Increase may remain incomplete.
Termination of the Underwriting Agreement shall be notified by
PESCANOVA by relevant act as soon as it occurs.
5.1.5 Description of the possibility of reducing subscriptions and the manner of
excess amount paid by applicants.
There is no possibility of reducing subscriptions in the Preferential
Subscription Period since subscription orders are firm and irrevocable and
only the holders of preferential subscription rights can exercise the right to
acquire New Shares. The possibility is provided for reducing applications for
subscription or Additional Shares in the event that the number of Additional
Shares applied for exceeds the number of New Shares pending allotment, in
accordance with the rules of allocating Additional Shares described in the
previous section 5.1.3.(2).
Securities Note
51
As indicated in greater detail in the following section 5.1.8, Participant
Entities may ask subscribers for a provision of funds in the amount
corresponding to the Subscription Price of the Additional Shares and, as the
case may be, the Discretionary Allotment Shares applied for. In any event, if
the number of Additional Shares eventually allocated to each applicant is
less than the number of Additional Shares applied for by the same or, if the
proposal for subscription of Discretionary Allotment Shares made by the
applicant is not confirmed in whole or in part by the COMPANY, the
Participant Entity will be obliged to return the corresponding amount of the
provision of funds or the amount corresponding to the excess of what has not
been allotted to the said applicant free of any expenses or commissions, in
accordance with the procedures applicable to such entities, and all within the
periods indicated in the said section 5.1.8.
5.1.6 Minimum and/or maximum amount of application for subscriptions.
The quantity of New Shares which may be subscribed for by shareholders of
the COMPANY in exercise of preferential subscription rights will be one
New Share for each 2 shares of the COMPANY in circulation which they
hold. There is no maximum amount of application for New Shares.
Furthermore, subscribers for New Shares who have made the corresponding
application for Additional Shares during the Preferential Subscription Period
may subscribe for Additional Shares on the terms indicated in the foregoing
sections 5.1.3.(1) and 5.1.3.(2). The maximum effective number of
Additional Shares which the said shareholders and Acquirers of Rights may
subscribe for will depend on the number of New Shares which remain to be
subscribed for in the Additional Allotment Period and the rules for allocation
of Additional Shares described in the previous section5.1.3.(2).
In the Discretionary Allotment Period there will be no minimum or
maximum number for proposals for subscription by the Investors in question
nor, as the case may be, for the Underwriters in exercise of their
underwriting commitments.
5.1.7 Period in which subscription applications may be withdrawn.
Applications for subscription of shares made during the Preferential
Subscription Period and the Additional Allotment Period (i.e. both those in
exercise of preferential subscription rights and applications for Additional
Shares) shall be treated as firm subscription orders and will therefore be
irrevocable, without prejudice to the said applications for Additional Shares
not being met in application of the rules for allocation of Surplus Shares
described in the previous section 5.1.3.(2).
Furthermore, proposals for subscription of Discretionary Allotment Shares
shall likewise be firm and irrevocable, except in the event that the
Underwriting Agreement is terminated as a result of reasons of force
majeure or does not come into force as a result of failure to comply with any
of the conditions to which it is subject. In such cases, proposals for
Securities Note
52
subscription of Discretionary Allotment Shares may be revoked and the
Capital Increase shall be subscribed for and paid up in the amount effectively
subscribed for in the Preferential Subscription Period and in the Additional
Allotment Period, which could give rise to incomplete subscription of the
Capital Increase.
5.1.8 Payment up and delivery of the Securities.
Payment up of the New Shares
Payment up of the shares subscribed for in the Preferential Subscription
Period
Payment up in full of the nominal value and issue premium of each of the
New Shares subscribed for in exercise of preferential subscription rights by
shareholders and/or Acquirers of Rights who exercise the corresponding
preferential subscription rights during the Preferential Subscription Period
shall take place at the same time as subscription, through the Participant
Entities which have processed the corresponding subscription orders.
Subscription orders which are not paid up on these terms will be treated as
not made.
By no later than 12:00 Madrid time on 2 August 2012, Participant Entities
with which subscription orders have been made shall be charged through
IBERCLEAR, with amounts received for subscription of the New Shares
during the Preferential Subscription Period which shall be paid into the
account opened in the name of PESCANOVA with the Agent, with value
date on the same day, in accordance with the operating instructions of the
Agent, with the exception of amounts corresponding to the subscription of
New Shares made in accordance with the provisions of section 5.2.2 by the
shareholders referred to therein, which shall be paid up by no later than the
third business day of the Preferential Subscription Period into the accounts
opened for these purposes in the name of PESCANOVA with Participant
Entities other than the Underwriters agreed between the COMPANY and the
shareholders referred to in the said section.
If any of the Participant Entity entities cannot be charged in full with the
amount corresponding to payment up of the said subscriptions within the
periods referred to, the Agent may not allocate the New Shares to the
Participant Entity in question, without any liability on the part of the Agent
or PESCANOVA and without prejudice to the possible liability which the
infringing Participant Entity may incur to those giving subscription orders
for New Shares made in due time and manner to the Participant Entity.
If any of the Participant Entities, after having been charged with the
corresponding amounts of the said subscriptions within the said period, does
not notify the Agent of the list of subscribers on the terms provided in this
Securities Note, the Agent shall assign the New Shares paid up in the name
of the said Participant Entity, all without any liability on the part of the
Agent or PESCANOVA and without prejudice to the possible liability which
Securities Note
53
the infringing Participant Entity may incur to those giving subscription order
for New Shares made in due time and manner to the said Participant Entity.
Payment up of shares subscribed for in the Additional Allotment Period
In relation to orders for subscription of Additional Shares which are allotted,
as the case may be, to shareholders and/or Acquirers of Rights in the
Additional Allotment Period, Participant Entities may request the provision
of unremunerated funds from shareholders and/or Acquirers of Rights for the
amount applied for subsequent payment up of these New Shares, after they
have been allotted. In any event, if the number of Additional Shares
eventually allotted to each applicant is less than the number of Additional
Shares applied for, the Participant Entity will be obliged to return to the
applicant the amount corresponding to the provision of funds, free from any
expenses or commissions, in the event of application, or the excess of that
not allotted, in accordance with the procedures applicable to such Participant
Entities. If for reasons attributable to the Participant Entity a delay occurs in
return of the corresponding provision of funds, the said Participant Entity
must pay late payment interest at the legal interest rate in force (currently
4%) which will accrue from the date on which the return should have been
made up to the date on which it is effectively made.
The Agent shall notify Participant Entities of the New Shares allotted to
shareholders and/or Acquirers of Rights foreseeably on the final day of the
Additional Allotment Period and in no event later than the business day
following the end of the said Additional Allotment Period (i.e., in
accordance with the forecast timetable, 2 August 2012).
Thereafter Participant Entities shall notify shareholders and/or Acquirers of
Rights of the Additional Shares which have been finally allotted to them. In
the event that a provision of funds has been made the Participant Entity shall
apply the provision. If no provision of funds has been made, the shareholder
or Acquirer of Rights must pay the amount of subscription at the time of
notification of allotment given to them by the Participant Entity.
By no later than 18:00 hours Madrid time on 2 August 2012, Participant
Entities to which subscription orders have been given will be charged with
amounts received for the subscription of New Shares during the Additional
Allotment Period for crediting to the account opened in the name of
PESCANOVA with the Agent, with value date on the same day, in
accordance with the operating instructions of the Agent.
If it is not possible to charge any of the Participant Entities in full with the
amount corresponding to payment up of the said subscriptions within the
said period, the Agent may not allocate the Additional Shares to the
Participant Entity in question without any liability on the part of the Agent or
PESCANOVA and without prejudice to possible liability which the
infringing Participant Entity may incur to those giving subscription orders
for Additional Shares submitted in due time and manner to the said
Participant Entity.
Securities Note
54
If any of the Participant Entities, after amounts corresponding to the said
subscriptions have been charged within the said period, does not notify the
Agent of the list of subscribers on the terms provided in this Securities Note,
the Agent shall allocate the Additional Shares paid up in the name of the said
Participant Entity, all without any liability on the part of the Agent or
PESCANOVA and without prejudice to the possible liability which the
infringing Participant Entity may incur to those giving subscription orders
for Additional Shares submitted in due time and manner to the said
Participant Entity.
Payment up of shares subscribed for in the Discretionary Allotment Period.
By no later than 18:00 hours on 2 August 2012, the COMPANY shall give
notice of definitive allocation of Discretionary Allotment Shares to the
Agent. The Agent shall in turn immediately notify this allotment to the
Underwriters. After allotments of Discretionary Allotment Shares have been
notified to the Investors, their proposals will automatically be converted into
firm subscription orders unless prior to the time of execution of the notarised
public deed of Capital Increase termination takes place of the Underwriting
Agreement, in which case they would be automatically revoked.
By no later than 09:00 hours Madrid time on 7 August 2012, the Investors
allotted the Discretionary Allotment Shares shall pay up the same through
the Underwriters.
By no later than 09:30 hours Madrid time on 7 August 2012, the
Underwriters shall credit amounts received for subscription of the
Discretionary Allotment Shares to the account opened in the name of
PESCANOVA with the Agent, with value date on the same date, in
accordance with the operating instructions of the Agent.
Delivery of the New Shares
Each of the subscribers for the New Shares shall be entitled to obtain from
the Participant Entity with which it has processed the subscription, a signed
copy of the subscription receipt with the content required by Section 309 of
the Capital Companies Act, within a maximum period of one week from
when the application for subscription is made. The said subscription receipt
shall not be negotiable and shall be in force until the registry references are
allocated corresponding to the New Shares subscribed, without prejudice to
their validity for evidentiary purposes in the event of possible claims or
incidents.
After payment up of the Capital Increase the corresponding notarised public
deed of capital increase shall be executed before notary public for
subsequent registration in the Pontevedra Commercial Registry. After the
said registration is made (which it is expected to take place on 8 August
2012) the corresponding deed of Capital Increase will be delivered to the
CNMV, to IBERCLEAR and to the Madrid Stock Exchange, as lead Stock
Securities Note
55
Exchange.
The New Shares will be created by their registration in the records of
IBERCLEAR after the Capital Increase public deed is registered in the
Commercial Registry.
On the same day of registration in the central register of IBERCLEAR,
Participant Entities will make the corresponding entries in their book records
in favour of holders of the New Shares. For these purposes the Agent will
notify IBERCLEAR through the Madrid and Bilbao Stock Exchanges of
information relating to the allotted investors such that they are allocated the
corresponding registry references.
The holders of the New Shares will be entitled to obtain certificates of
accreditation from the Participant Entities corresponding to the said shares in
accordance with the provisions of Royal Decree 116/1992, of 14 February.
Finally, it is planned that on a date which is not estimated to be after 15
August 2012, the New Shares will be admitted to trading on the Madrid and
Bilbao Exchanges and will be included in the Stock Exchange
Interconnection System (Continuous Market).
5.1.9 Full description of the manner and date on which the results of the offer
are to be made public.
The COMPANY will publish through a relevant fact:
(i)
Of compliance with the commitment assumed by significant
shareholders referred to in the following section 5.2.2 to subscribe for
and pay up within the first three business days of the Preferential
Subscription Period the Committed Shares (as the said term is defined
in that section), on the same date on which it takes place.
(ii)
After the Additional Allotment Period: Of the number of shares
subscribed for during the Preferential Subscription Period and the
number of Additional Shares allotted, indicating as appropriate whether
there has been pro rata distribution and whether or not the
Discretionary Allotment Period is opened and, if not, the result of the
Capital Increase detailing the number of New Shares subscribed for in
each of the periods.
(iii) After the Discretionary Allotment Period, in the event that it is opened:
Of the result of the Capital Increase, detailing the number of New
Shares subscribed for in each of the periods.
Securities Note
56
5.1.10 The procedure for the exercise of any right of pre-emption, the
negotiability of subscription rights and the treatment of subscription
rights not exercised.
Shareholders and Acquirers of Rights who, as a result of having acquired
them, are holders of preferential subscription rights for the New Shares
shall be entitled to preferential subscription, all as explained in more detail
in the previous section 5.1.3.
Preferential subscription rights shall be transferable on the same conditions
as the shares from which they derive, in accordance with Section 306.2 of
the Capital Companies Act. Consequently, preferential subscription rights
will be freely traded on the Madrid and Bilbao Stock Exchanges through
the Stock Exchange Interconnection System (Continuous Market), and the
valuation which the market gives to them cannot be anticipated.
At the end of the Preferential Subscription Period, preferential subscription
rights which have not been exercised will be extinguished.
The theoretical value of each preferential subscription right will be
calculated on the closing price on the day prior to commencement of the
Preferential Subscription Period, in accordance with the following formula:
(PC – PE) * NAN
VTD=--------------------NAP + NAN
Where:
VTD: Theoretical value of the right, taking into account that a dividend
distribution has not been resolved.
PC: Closing quotation price corresponding to the stock exchange session
of the day prior to commencement of the Preferential Subscription
Period.
PE: Issue price: 13.45 euros per New Share.
NAP: Number of shares prior to the Capital Increase with preferential
subscription rights (discounting treasury shares as indicated in
section 5.1.3 of the Securities Note, - 866,326): 18,580,928.
NAN: Number of New Shares: 9,290,464.
Based on the quotation price of the PESCANOVA share at session closing
on 6 July 2012, (22.11 euros) the theoretical value of each preferential
subscription right would amount to 2.8867 euros.
In any event, as indicated, preferential subscription rights will be freely
negotiable and the value which the market gives to these rights cannot be
anticipated.
Securities Note
57
5.2 Plan of distribution and allotment.
5.2.1 Categories of potential investors and markets for listing the securities.
The Capital Increase is aimed at the current shareholders of PESCANOVA,
who are accredited as such in accordance with the book records of
IBERCLEAR at 23:59 Madrid time on the day prior to commencement of
the Preferential Subscription Period, and investors who acquire preferential
subscription rights and, if Shares remain unsubscribed at the end of the
Additional Allotment Period, potential foreign and national qualified
investors.
This document and the information it contains are not aimed at investors in
Australia, Canada, the USA or Japan and it does not constitute an offering of
securities nor may it be communicated to any person within these countries.
No security may be offered or sold within Australia, Canada, the USA or
Japan, in the absence of prior registration under the securities market
legislation which is applicable (and in the specific case of the USA, under
the U.S. Securities Act of 1933) or the availability of a registration exception
for such offering or sale. The COMPANY has no intention of registering the
offering or sale of its New Shares in Australia, Canada, the USA or Japan
nor of making a public offering in these countries. Furthermore, no
exception from registration will be applied for in order to permit the
preferential subscription rights or New Shares of the COMPANY being
offered, exercised, sold or delivered in Australia, Canada, the USA or Japan.
Consequently, neither the preferential subscription rights nor the New Shares
of the COMPANY may be offered, exercised, sold or delivered in these
countries.
In the specific case of US investors, no subscription for shares may be
accepted from an investor within the United States of America nor from any
person acting on behalf of or on behalf of an investor within the United
States of America. It will be deemed that each investor (or the financial
institution representing him) makes the following declaration at the time of
exercising his preferential subscription rights or proceeding to subscribe for
New Shares:
“I confirm that (i) I have not received within the United States of America
either the Prospectus (comprising registration document, securities note and
summary) nor any other document connected with the Capital Increase of
PESCANOVA, S.A. or the exercise of preferential subscription rights
corresponding to the shares of PESCANOVA, S.A., and (ii) at the time when
I exercise my preferential subscription rights I am outside the United States
of America, I do not act on behalf of or on behalf of persons within the
United States of America and I am acquiring the shares of PESCANOVA,
S.A. in the framework of an off-shore transaction in accordance with the
provisions of Regulation S of the U.S. Securities Act of 1933.”
Securities Note
58
Authorised financial intermediaries must not accept the exercise of
preferential subscription rights or proposals for subscription of New Shares
made by clients who have their address in the United States of America.
5.2.2 Major shareholders or members of administrative, management or
supervisory bodies of the issuer who intend to subscribe to the Capital
Increase and persons who intend to subscribe for more than 5% of the
Capital Increase.
The shareholders who are also directors of PESCANOVA or who have
proposed the appointment of proprietary directors, Mr. Manuel Fernández de
Sousa-Faro (through Sociedad Anónima de Desarrollo y Control), Mr.
Alfonso Paz-Andrade Rodríguez (through Nova Ardara Equities, S.A.),
Luxempart, S.A. and Corporación Económica Damm (which proposed the
appointment of the director Mr. José Carceller Arce), who are (direct and
indirect) holders in total of 37.58% of the share capital of PESCANOVA,
have notified the COMPANY of their unconditional and irrevocable
commitment to subscribe for and pay up overall at least 25,000,012.65 euros
by subscription and payment up of 1,858,737 New Shares, representing
approximately 20% of the total New Shares (the “Shares Committed”).
The subscription and payment up of the total Shares Committed will take
place by the said shareholders by no later than the third business day of the
Preferential Subscription Period. Payment up will take place into the account
PESCANOVA indicates to the shareholder of those it has open with Spanish
credit institutions. Compliance with this commitment will be notified to the
market by relevant fact on the same date on which it takes place.
The said shareholders may, if they so wish, insofar as they have exercised the
whole of their preferential subscription rights, further during the Preferential
Subscription Period make orders for subscription of Additional Shares for
allotment in the Additional Allotment Period.
It is recorded that during the Preferential Subscription Period, the shareholder
Sociedad Anónima del Desarrollo y Control a company directly holding
14.823% of the capital of PESCANOVA controlled by Mr. Manuel
Fernández de Sousa-Faro, will carry out sale operations of those preferential
subscription rights which it does not need to retain in order to be able to
reinvest the funds from the sale of the said rights in subscription for New
Shares issued by the COMPANY pursuant to the Capital Increase.
The remaining members of the Board of Directors and members of senior
management of PESCANOVA have not given any firm indication to the
COMPANY of their intention to exercise or not the preferential subscription
rights which they may hold.
5.2.3 Pre-allotment disclosure.
Not applicable.
Securities Note
59
5.2.4 Process for notification to applicants of the amount allotted and indication
whether dealing may begin before notification is made.
See the previous section 5.1.3 of this Securities Note.
5.2.5 Over-allotment and green shoe.
Not applicable.
5.3 Pricing.
5.3.1 Price of the securities and method for its determination; expenses of the
subscriber.
Price and method for its determination
The nominal value of the New Shares relating to the Capital Increase is six
euros per New Share and the issue premium is 7.45 euros. Consequently, the
issue price per New Share is 13.45 euros (the “Subscription Price”).
Expenses specifically charged to the subscriber
The Capital Increase is made free of expenses to subscribers, who will only
have to subscribe in the amount of nominal value and issue premium of each
New Share.
PESCANOVA will not recover any expense from subscribers in relation to
the New Shares. No expenses will accrue for first registration of the New
Shares in the book records of Participant Entities. Nevertheless, Participant
Entities who maintain accounts for holders of PESCANOVA shares may, in
accordance with current legislation, establish the commissions and expenses
recoverable in respect of administration as they freely determine, resulting
from maintenance of the securities in their accounting records, in accordance
with the respective tariff leaflets duly registered with the CNMV and the
Bank of Spain.
Furthermore, Participant Entities through which subscription takes place
may, in accordance with current legislation, establish the commissions and
expenses recoverable by way of processing orders for subscription for
securities and purchase and sale of preferential subscription rights as they
freely determine.
5.3.2 Process for publication of the price of the securities.
As indicated, the Subscription Price is 13.45 euros per New Share.
5.3.3 Restriction or elimination of preferential subscription rights of
shareholders; issue price of the securities.
It is not appropriate to make any reference as a result of acknowledgement of
Securities Note
60
the preferential subscription rights of PESCANOVA shareholders in relation
to the New Shares covered by the Capital Increase.
5.3.4 Disparity between the issue price and effective cash cost to members of
administrative, management or supervisory bodies or senior executives or
affiliated persons, of securities acquired by them in transactions carried
out during the most recent year, or which they have the right to acquire.
Comparison of the public contribution in the issue and cash contributions
of such persons.
Members of the Board of Directors of the COMPANY or management or
supervisory bodies or senior executives of the COMPANY or related
persons who subscribe for New Shares, as the case may be, will do so at the
Subscription Price.
Within the last year no acquisitions of shares of the COMPANY have taken
place by members of the administrative, management or supervisory bodies
or senior executives or persons related to them.
5.4 Placing and underwriting.
5.4.1 Name and address of the global coordinator.
BNP Paribas, with registered office at 16 boulevard des Italiens, 75009
Paris, France, acts as Global Coordinator and Sole Bookrunner of the
Capital Increase covered by this Securities Note.
5.4.2 Name and address of any payment Agent and of depositaries.
BNP Paribas Securities Services, S.A., Sucursal en España, with address at
Ribera del Loira, 28 28042 Madrid, Spain, has been appointed by the
COMPANY as Agent of the Capital Increase covered by this Securities
Note.
5.4.3 Name and address of placement entities and underwriters.
BNP Paribas, with registered office at 16 boulevard des Italiens, 75009
Paris, France, and Banco BPI, S.A., with registered office at Rua Tenente
Valadim 284, Oporto, Portugal, have been appointed by the COMPANY as
Underwriters of the Capital Increase covered by this Securities Note.
As previously mentioned, approximately 64% of the New Shares are
underwritten by the Underwriters, such that approximately 16% of the New
Shares which are not underwritten by either the Underwriters or by the
significant shareholders indicated in the previous section 5.2.2.
In the event that the underwriting commitment assumed to the COMPANY
by the Underwriters (the terms of which are described below) does not or
ceases to have effect, the capital of the COMPANY would be increased
solely by the amount of subscriptions made, consequently giving rise to a
Securities Note
61
case of incomplete subscription covered by Section 311.1 of the Capital
Companies Act.
An Underwriting Agreement was executed in relation to the Capital Increase
between the Underwriters and the COMPANY.
The principal terms of the Underwriting Agreement are as follows:
(A)
Underwriting commitment
Approximately 64% of the New Shares are subject to underwriting by the
Underwriters under the Underwriting Agreement. The total number of New
Shares underwritten is referred to as the “Total Underwriting
Commitment”. The number of New Shares underwritten by each
Underwriter and the percentage of the Capital Increase underwritten by each
of them are as follows:
Underwriter
BNP Paribas ............................................................
Banco BPI, S.A. .......................................................
Total Underwriting Commitment..........................
New Shares underwritten
(by number)
(by %)
4,832,714
52%
1,115,242
12%
5,947,956
64%
The underwriting commitment of each Underwriter, in proportion to its
participation in the Total Underwriting Commitment, will be reduced by the
number of New Shares which have been subscribed for in the Preferential
Subscription Period, in the Additional Allotment Period and in the
Discretionary Allotment Period.
Consequently, in the event that 84% of the New Shares are subscribed for in
the three periods referred to (taking into account the Shares Committed), the
Underwriters would be released from the underwriting commitments.
Thus, if that after the Discretionary Allotment Period has elapsed, the sum of
the New Shares subscribed for by shareholders and Acquirers of Rights in
the Preferential Subscription Period and in the Additional Allotment Period
and, as the case may be, by Investors in the Discretionary Allotment Period,
is less than 84% of total number of New Shares (taking into account the
Shares Committed), the Underwriters undertake to subscribe for and pay up
in their own name and behalf the New Shares corresponding to them for
subscription pursuant to their respective underwriting commitments, in the
amount and proportion indicated in this section.
The foregoing commitment is conditional, in accordance with the previous
section 5.2.2, on the significant shareholders who are also directors of
PESCANOVA or who have proposed the appointment of proprietary
directors identified therein having subscribed for and paid up within the first
three days of the Preferential Subscription Period, a minimum cash amount
of 25,000,012.65 euros by subscription and payment up of 1,858,737 New
Shares, representing approximately 20% of the Capital Increase.
Securities Note
62
By way of exception to the foregoing, in the event that after completion of
the Additional Allotment Period, Discretionary Allotment Shares exist, the
Global Coordinator on behalf of the Underwriters may at any time during the
Discretionary Allotment Period decide to subscribe directly for the
Discretionary Allotment Shares in proportion to their respective
underwriting commitments at the Subscription Price, bringing the Capital
Increase to an early close. In this event, the dates of closing and payment of
the Capital Increase provided in the tentative timetable in the foregoing
section 5.1.3.(5) may be brought forward.
In no event will the Underwriters have to subscribe for a number of
Discretionary Allotment Shares exceeding the number of shares covered by
the Total Underwriting Commitment.
The underwriting commitments undertook by the Underwriters are of a joint
pro rata nature. In the event of breach by any Underwriter of its underwriting
obligations, the Underwriter in breach will not receive any commission for
placement or underwriting
(B)
Fees
As remuneration for the services provided in relation to the Capital Increase,
PESCANOVA will pay to BNP Paribas, as Global Coordinator and Sole
Bookrunner on the Capital Increase, a management fee of 1% applied of the
result of multiplying the number of New Shares by the Subscription Price.
PESCANOVA will further pay to the Underwriters a distribution fee of 4%
of the result of multiplying the Total Underwriting Commitment by the
Subscription Price which will be distributed between the Underwriters in
proportion to their respective underwriting commitments.
The foregoing fees will be paid by the Agent, acting on behalf of the
COMPANY, on the business day following the Disbursement Date (initially
expected on 7 August 2012), with value date on the same day.
(C)
Grounds for termination as a result of force majeure and conditions
precedent
The Underwriting Agreement may be terminated by unanimous decision of
both Underwriters if at any time from signature until execution of the public
deed of capital increase any event of force majeure arises which in the
unanimous opinion of the Underwriters makes it impracticable or
inadvisable to continue with the Capital Increase.
For these purposes only the following will be considered as reasons of force
majeure:
(a)
Securities Note
A material adverse change in the condition (financial, operational, legal
or otherwise) or in the earnings or business affairs or prospects of
63
PESCANOVA and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business.
(b)
A material adverse change in the financial markets in Spain, the United
States, the United Kingdom or in the national or international currency
exchange rates or controls.
(c)
A general suspension of the trading of shares declared by the competent
authorities at the Spanish Stock Exchanges, the London Stock
Exchange or the New York Stock Exchange
(d)
The suspension of the trading of the Company’s shares on the Stock
Exchanges either (a) lasting more than twenty four (24) consecutive
hours, if taking place within the first thirteen calendar days of the
Preferential Subscription Period, or (b) regardless of its length of time,
if taking place from the second-to-last calendar day of the Preferential
Subscription Period to the Disbursement Date.
(e)
The general suspension declared by the competent authorities, or a
material disruption, of banking activities or of securities clearing and
settlement services, in Spain, the United Kingdom or the United States
of America.
(f)
An outbreak or aggravation of hostilities or any similar conflict or a
large-scale terrorist attack or a declaration of war or national
emergency where such event has a material adverse effect on the
indices of the Spanish Stock Exchanges, the London Stock Exchange or
the New York Stock Exchange.
(g)
A change in European Union or Spanish legislation or an official
announcement of, or approval of any bill that foreseeably entails a
change of European Union or Spanish legislation that negatively and
materially affects the activities of the Company and its Material
Subsidiaries taken as a whole or the Capital Increase.
In the event of termination of the Underwriting Agreement, PESCANOVA
will make this public by relevant fact sent to the CNMV and the Capital
Increase will remain without being underwritten, and incomplete
subscription may take place. The consequences of this termination will be
the following, depending on the time when it takes place:
(a)
Securities Note
If the Underwriting Agreement is terminated at or prior to 9:00 hours
Madrid time on the day of publication of the announcement of the
Capital Increase in the BORME (which is expected to happen on 11
July 2012), the Board of Directors of the COMPANY, or by delegation
from it, the Chairman of the Board of Directors, may decide not to
carry out the Capital Increase or, alternatively, continue with the
Capital Increase without underwriting.
64
(b)
If the Underwriting Agreement is terminated after 9:00 hours Madrid
time on the day of publication of the announcement of the Capital
Increase in the BORME (which is expected to happen on 11 July
2012), proposals for subscription sent, as the case may be, by qualified
investors during the Discretionary Allotment Period, irrespective of
whether they have been allocated New Shares (whether to them or to
any of the Underwriters in compliance with their underwriting
commitments) shall be deemed to be revoked and terminated and if the
amount of New Shares subscribed by shareholders and Acquirers of
Rights in the Preferential Subscription Period and in the Additional
Allotment Period together with the Shares Committed are insufficient
to cover the whole of the New Shares, the Board of Directors of the
COMPANY or, by delegation from it, the Chairman of the Board of
Directors, shall declare the subscription incomplete and the share
capital of PESCANOVA shall be increased by the amount of
subscriptions effectively made.
In addition, the obligations of the Underwriters are subject to compliance by
the COMPANY, in any event prior to 7 August 2012, with several
conditions precedent regular in this type of transaction, such as (i)
registration of the Securities Note by the CNMV, (ii) publication of the
announcement of the Capital Increase in the BORME, (iii) delivery to the
Underwriters of legal opinions from the legal advisors of the COMPANY,
both on the date of registration of the Securities Note (or any possible
supplement to it) and on execution of the deed of Capital Increase, or (iv)
delivery to the Underwriters by the auditors of the COMPANY of comfort
letters regarding certain financial data included in the Securities Note and in
the Registration Document registered in the Records of the CNMV on 26
June 2012, both on the date of registration thereof and on that of execution
of the deed of Capital Increase.
In particular, in accordance with the provisions of the previous section 5.2.2
of this Securities Note, subscription and payment up by the shareholders
identified therein by no later than the third business day of the Preferential
Subscription Period in respect of an overall minimum cash amount
25,000,012.65 euros by subscription and payment up of 1,858,737 New
Shares, representing approximately 20% of the total New Shares is
established as a condition precedent of the obligations of the Underwriters.
Compliance with this commitment will be notified to the market by a
relevant fact on the same date on which it takes place.
In the event that any of the conditions precedent laid down in the
Underwriting Agreement are not fulfilled, the obligations of the
Underwriters, including those of underwriting, will not come into force and
the consequences will be applicable stipulated in the immediately previous
paragraph (b), i.e. subscription proposals sent, as the case may be, by
Investors in the Discretionary Allotment Period will be deemed revoked if
the amount of New Shares subscribed by shareholders and Acquirers of
Rights in the Preferential Subscription Period and in the Additional
Allotment Period are not sufficient to cover the whole of the New Shares,
Securities Note
65
and the COMPANY will declare incomplete subscription of the Capital
Increase.
(D) Commitment not to transfer shares (lock-up)
The Underwriting Agreement further includes a commitment by the
COMPANY, without authorisation of the two Underwriters (which may not
be unreasonably refused or postponed without cause) not to issue, offer, sell,
agree to issue or sell or, in any other way, directly or indirectly dispose of, or
perform any transaction that might have an economic effect similar to the
issuance or sale, or the announcement of the issuance or sale, of shares of the
COMPANY, securities that are convertible or exchangeable into or
otherwise giving access to shares of the COMPANY, warrants, or any other
instruments that might give the right to subscribe or acquire shares of the
COMPANY, including by means of derivative transactions, from the date of
the Underwriting Agreement until one hundred and eighty (180) days
following the date of the admission to trading of the New Shares on the
Stock Exchanges.
As the only exceptions to such undertaking, PESCANOVA may, without
being necessary the aforementioned prior authorization of the Underwriters,
carry out: (i) issuances and/or deliveries of options and shares granted to
employees and officers of the COMPANY or its material subsidiaries within
the framework of compensation for such employees or officers (including
those shares that, within the framework of such programmes, are subscribed
or acquired by financial entities), as well as shares that are issued as a result
of the exercise of such options; (ii) transfer of shares resulting from the
ordinary-course trading by PESCANOVA on its treasury shares in a manner
consistent with its past practice; (iii) transfers of shares between entities
belonging to the same group (within the meaning of article 42 of the Spanish
Commercial Code) provided the acquiring entity commits not to transfer the
shares for the remaining period; (iv) issue of shares to honour the conversion
of the convertible bonds issued by the COMPANY prior to the closing date
into shares; and (v) transfer of the equity swap shares at maturity or in the
event of early termination of the equity swap by the counterparty (in the case
of the equity swap entered into with Commerzbank on 20 June 2011,
referred to in the previous section 5.1.3 in December 2012, in the absence of
renewal of the agreement).
Furthermore, the shareholder Sociedad Anónima de Desarrollo y Control
(SODESCO), a company controlled by Mr. Manuel Fernández de SousaFaro, has also entered into similar agreements which prohibit the disposal of
shares of the COMPANY from the date of the Underwriting Agreement until
180 days have elapsed from the date of admission to trading of the New
Shares. As sole exception to this commitment, the said shareholder may
without requiring the authorisation of the two Underwriters (i) transfer
shares between entities belonging to the same group within the meaning of
Section 42 of the Commercial Code, provided that any transferee has agreed
to be bound by the same restrictions for the remainder of such 180 day
period, (ii) transfer shares by way of tendering them in a takeover offer over
Securities Note
66
the COMPANY, and (iii) transfer those preferential subscription rights as it
is not required to retain and exercise in order to reinvest in full the proceeds
of those sales in the subscription of New Shares pursuant to the Capital
Increase in accordance with the previous section 5.2.2.
In the event that (i) the COMPANY notifies shareholders that it has no
intention to carry out the Capital Increase, or (ii) for any reason the
Underwriting Agreement is terminated, the COMPANY and the shareholder
referred to above will immediately and automatically be released from the
commitments not to transfer shares assumed to the Underwriters.
5.4.4 When the underwriting agreement has been or will be reached.
See previous section 5.4.3.
6
ADMISSION TO TRADING AND DEALING ARRANGEMENTS
6.1 Application for admission to listing.
In exercise of the delegation by the Ordinary Shareholders General Meeting
of the COMPANY on 13 April 2012, the Board of Directors of the
COMPANY, at its meeting held on 2 July 2012, resolved to apply for
admission to listing of the New Shares on the Madrid and Bilbao Stock
Exchanges and their trading through the Stock Exchange Interconnection
System (Continuous Market).
After registration of the deed of capital increase pursuant to which the New
Shares will be issued in the Pontevedra Commercial Registry, and
submission of a notary copy of the said deed to IBERCLEAR and registration
of the New Shares as book entries by IBERCLEAR and its Participant
Entities, admission to trading of the New Shares on the Madrid and Bilbao
Stock Exchanges will be immediately processed.
In this respect, PESCANOVA estimates that, in the absence of unforeseen
events, the New Shares will be admitted to listing on the Madrid and Bilbao
Stock Exchanges through the Stock Exchange Interconnection System
(Continuous Market) on 15 August 2012, and in any event by no later than 15
Stock Exchange business days following the date on which the Board of
Directors of PESCANOVA or, by delegation therefrom, the Chairman of the
Board of Directors, declares that the Increase has been executed pursuant to
which the New Shares will be issued. In the event that delays occur in
admission to trading in relation to the planned date, PESCANOVA
undertakes immediately to publicise the reasons for the delay in the listing
bulletins of the Madrid and Bilbao Stock Exchanges and to give notice
thereof to the market by relevant fact.
PESCANOVA is aware of the requirements and conditions for admission,
continuation and exclusion of the shares representing its share capital on the
markets previously referred to, and undertakes to comply with them.
Securities Note
67
6.2 Regulated markets or equivalent markets on which, securities of the same
class of the securities to be issued are already admitted to trading.
The shares of PESCANOVA are listed on the Madrid and Bilbao Stock
Exchanges through the Stock Exchange Interconnection System (Continuous
Market).
6.3 Existence of other securities for which admission is sought on a regulated
market.
Not applicable.
6.4 Entities which will act as intermediaries in secondary trading, providing
liquidity through bid and offer rates.
Not applicable.
6.5 Stabilisation activities.
Not applicable.
6.5.1 Possibilities and guarantees that the stabilisation activities can be carried
out or halted.
Not applicable.
6.5.2 Beginning and end of the period during which stabilisation activities can
be carried out.
Not applicable.
6.5.3 Entity directing the stabilisation.
Not applicable.
6.5.4 Possibility that stabilisation operations could give rise to a higher market
price than that which they would otherwise be.
Not applicable.
7. SELLING SECURITIES HOLDERS
7.1 Person or entity offering to sell the securities; material relationship which
the sellers have had in the last three years with the issuer or with any of its
predecessors or related persons.
Not applicable.
Securities Note
68
7.2 Number and class of the securities offered by each of the holders selling
securities.
Not applicable.
7.3 Lock-up agreements.
There are no commitments not to dispose of shares of the COMPANY other
than those covered by section 5.1.3.(1) with respect to the treasury shares held
by the COMPANY directly and the shares subject to the equity swap
agreement entered into by PESCANOVA with Commerzbank AG which are
treated as direct treasury shares, as well as in section 5.4.3.(D) in relation to
the Underwriting Agreement.
8.
EXPENSES OF THE CAPITAL INCREASE
8.1 Total net income and calculation of total expenses of the Capital Increase.
The expenses of the Capital Increase (without including VAT) are those
indicated below on a purely informative basis given the difficulty of
specifying their definitive amount at the date of this Securities Note:
EXPENSES
Estimated amount
(thousands of €)
CNMV Fees
9.5642
Fees of Spanish Stock Exchanges
7
Fees of IBERCLEAR
7
4,450
Management and distribution fees
Other expenses (including agency fee, legal and commercial publicity,
printing, legal advice, auditing)
330
4,803.5642
TOTAL
The total expenses of the Capital Increase represent approximately 3.84% of
the countervalue of the New Shares, assuming full subscription of the
planned amount (124,956,740.80 euros) of the Capital Increase, such that net
income from the Capital Increase amounts to 120,153,176.60 euros.
9.
DILUTION
9.1 Amount and percentage of immediate dilution resulting from the Capital
Increase.
As referred to in section 5.1.2 of this Securities Note, the shareholders of the
COMPANY have preferential subscription rights for the New Shares covered
by the Capital Increase, and therefore if they exercise the said rights they will
not suffer any dilution in their holding in the share capital of the COMPANY.
Securities Note
69
9.2 Subscription offer to current holders, amount and percentage of immediate
dilution if not subscribing for the Capital Increase.
In the event that a shareholder of the COMPANY does not subscribe for
New Shares in the percentage corresponding thereto as a result of
preferential subscription rights, the holding thereof would undergo a dilution
of 32.33% of the share capital prior to the Capital Increase.
Notwithstanding the above, it is stated that, as indicated in the previous
section 5.2.2, certain significant shareholders of PESCANOVA who are also
directors or have proposed the appointment of proprietary directors have
undertaken to subscribe and pay up by no later than the third business day of
the Preferential Subscription Period a minimum overall cash amount of
25,000,012.65 euros by subscription and payment up of 1,858,737 New
Shares, representing approximately 20% of the total New Shares in exercise
of preferential subscription rights in the framework of the Capital Increase.
10. ADDITIONAL INFORMATION
10.1 Advisors connected with the issue.
Without prejudice to the provisions of the previous section 5.4, the following
entities have provided advisory services in relation to the Capital Increase:
(i)
Uría Menéndez Abogados, S.L.P., law firm responsible for providing
Spanish legal advice to PESCANOVA.
(ii)
BDO Audiberia Auditores, S.L., the auditors of accounts of
PESCANOVA.
(iii) Linklaters, S.L.P., law firm responsible for providing legal advice to the
Underwriters.
10.2 Additional information regarding the securities which has been audited
and reviewed by auditors and if the auditors have submitted a report.
The individual and consolidated annual financial statements and management
reports of the COMPANY for the 2009, 2010 and 2011 financial years have
been audited by the external audit firm BDO Audiberia Auditores, S.L., with
registered office in Barcelona, at calle San Elías number 29 to 35, and
registered in the Official Register of Auditors under number S-1273.
10.3 Declaration or report attributed to persons in the capacity of expert.
Not applicable.
10.4 Third party information; confirmation that the information has been
reproduced accurately and that no facts have been omitted which would
make the information reproduced inaccurate or misleading.
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Not applicable.
11. UPDATING OF THE REGISTRATION DOCUMENT
Most relevant events occurred after the date of registration of the Registration
Document of the issuer.
Since 26 June 2012, the registration date of the PESCANOVA Registration
Document in the official records of the CNMV, and up to the present date, no
events have occurred which significantly affect the COMPANY susceptible to
affecting the valuation of the Capital Increase by investors.
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This Securities Note has been initialized on all pages and signed in ChapelaRedondela, Pontevedra, on 10 July 2012.
Signed on behalf of PESCANOVA, S.A.
______________________________
Mr. Manuel Fernández de Sousa-Faro
Chairman
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