| The Board of Directors approves financial statements as of 31 December 2007 and financial statements for the quarter ending 31 March 2008. Two new alternative investment funds authorized for Sopaf Capital Management SGR. |
|
The Board of Directors approves financial statements as of 31 December 2007:
- Consolidated net profit: €35.8 million (€10.1 million for the previous fiscal year of six months)
- Consolidated shareholders' equity: €174.9 million (€156.3 million as of 31 December 2006)
- Consolidated net financial position: €151.6 million (€121.7 million as of 31 December 2006)
- Sopaf S.p.A. net profit: 20.1 million (€1.8 million for the previous fiscal year of six months)
and financial statements for the quarter ending 31 March 2008:
- Consolidated net profit: net loss of €2.2 million (€43.8 million net profit in the first quarter of 2007)
- Consolidated shareholders' equity: €167.8 million (€174.9 million as of 31 December 2007)
- Consolidated net financial position: €176.3 million (€151.6 million as of 31 December 2007)
Two new alternative investment funds authorized for Sopaf Capital Management SGR.
Milan, 13 May 2008 – At a meeting held today, the Sopaf S.p.A. Board of Directors approved the consolidated financial statements and the draft of Sopaf S.p.A.'s financial statements as of 31 December 2007, the annual report on corporate governance, as well as the consolidated quarterly report as of 31 March 2008.
Consolidated results for the year of 2007*
The revenues and income from investment activity amount to €73.9 million and include €63.7 million of profits on the disposal of non-current assets and €10.2 million of profits accrued on shareholdings valued with the net equity method (€8.3 million and €10.7 million, respectively, for the six-month fiscal year ending 31 December 2006). Such revenues mainly refer to the divestiture of the shareholdings in Immsi S.p.A. and in the real estate fund Aster, as well as the capital gain realized on the sale of 40% of Telma S.r.l. carried out by the real estate fund, Tergeste, which is wholly owned by the Sopaf Group.
The other revenues and income for year amounted to €6.2 million (€5 million during the previous year of six months), and include commissions generated by the product companies in the amount of roughly €4.7 million.
Deductions from revenues included operating expenses and purchases of services and materials roughly €26.6 million and writedowns of shareholdings of €13.6 million, with the latter amount referring almost exclusively to the investment in Coronet S.p.A. (€13.4 million).
The annual operating profit amounted to €28.9 million (€3.7 million during the preceding fiscal year of six months), while earnings before taxes and interest were equal to €39.1 million (€14.3 million for the preceding year).
Net financial charges came to €3.4 million, compared with €3.8 million for the preceding year of six months.
Profit before taxes equalled €35.7 million (€10.5 during the preceding fiscal year of six months).
After an income tax provision of €0.1 million, the Group's net earnings amounted to €35.8 million (compared with €10.1 million for the preceding year) and include €0.2 million of earnings accruing to minority interests.
Total shareholders' equity as of 31 December 2007 was €182.0 million (compared with €179.6 million as of 31 December 2006), including €7.2 million of minority interests (€23.3 million as of 31 December 2006), and the Group's share of €174.9 million (versus €156.3 million as of 31 December 2006).
The Group's total assets of €396.6 million as of 31 December 2007 increased over the €353.8 million reported at 31 December 2006 mainly for the effect of (i) the investments made in Banca Bipielle Network (which in January was renamed Banca Network Investimenti) and in Area Life International Ltd. and (ii) the reclassification of the investment in Delta as an "asset available for sale", and the consequent adjustment of the investment's value to fair value.
Incorporating the effect of the aforementioned acquisitions, the Group's net financial position as of 31 December 2007 rose to €151.6 million, compared with €121.7 million as of 31 December 2006. It is noted that in August, the Company perfected the issuance of the "SOPAF 2007-2012 3.875% convertible bonds" which made it possible for Sopaf to tap funding of €49.7 million.
Holding company's results for the year of 2007
The holding company, Sopaf, closed the year with a net profit of 20.1 million (€1.8 million during the preceding fiscal year of six months) and shareholders' equity of €131.0 million (€82.8 million as of 31 December 2006).
Proposal to the shareholders' meeting
The Board of Directors passed a resolution to submit a proposal to the shareholders' meeting recommending that the annual earnings be allocated toward covering part of the losses carried forward since 30 June 2005, or €22.8 million.
The Board of Directors will submit another proposal to the shareholders' meeting covering a plan to restructure the shareholders' equity of Sopaf S.p.A. so as to cover all losses carried forward with the use of reserves existing as of 31 December 2007.
Consolidated results for the first quarter of 2008*
The revenues and income from investment activity amount to €2.1 million compared with €50.9 million for the first quarter of 2007 (mostly related to the sale of Immsi) and include the capital gain realized on the sale of 128 units of the fund, FIP Fondo Immobili Pubblici (€2.1 million) and the Group's share of losses of the Banca Network Investimenti (€1.1 million).
The revenues and income for the quarter of €1.5 million (€1.2 million in the first quarter of 2007) include roughly €0.9 million of commissions generated by the product companies.
The operating expenses and purchases of services and materials during the quarter amounted to €4.4 million and thus declined with respect to the €5 million posted for the first quarter of 2007.
At the level of earnings before taxes and interest, the Group sustained a loss of €1.1 million (compared with a profit of €46.9 million in the first quarter of 2007).
The net financial charges amounted to €1.5 million, compared with net financial income of €1.8 million for the first quarter of 2007.
The pre-tax loss was €2.6 million (versus a profit of €48.7 million for the first quarter of 2007).
After the usage of deferred tax provisions of €0.3 million, the Group's net loss was €2.2 million (compared with €43.8 million of profits for the first quarter of 2007).
Total shareholders' equity as of 31 March 2008 came to €174.1 million (compared with €182.0 million as of 31 December 2007), including €6.3 million of minority interests (€7.2 million as of 31 December 2007) and the Group's share of €167.8 million (versus €174.9 million as of 31 December 2007).
The Group's total assets as of 31 March 2008 amounted to €413.3 million (€396.6 million as of 31 December 2007).
The Group's net financial debt as of 31 March 2008 stood at €176.3 million, compared with €151.6 million as of 31 December 2007.
Outlook for 2008
Management remains confident about the possibility of capitalizing on new investment opportunities consistent with the Group's business model so as to maintain a satisfactory level of profitability. In consideration thereof, Sopaf is refocusing its investment activity, and specifically, via a review of its portfolio of shareholdings.
Material events during the first quarter of 2008 and subsequent events
- On 11 January 2008, Sopaf S.p.A. purchased 45% of Aviva Previdenza S.p.A. (€14.4 million).
- During the first few months of 2008, Sopaf S.p.A. purchased the remaining interest of 23% of the capital of PWM SGR, with a view toward streamlining the company's structure; the perfection of the transaction is subject to the approval of the regulatory authorities, and once perfected, PWM SGR will be merged into Sopaf Capital Management SGR.
- On 3 March, the affiliate company, AFT/LINKEM, was adjudicated the right to use WiMax licenses for 13 regions of Italy, which are home to more than 75% of the country's resident population (for a total investment of €34 million). On 1 April, Sopaf disbursed €18.5 million of financing to the affiliate.
- On 12 March, Sopaf acquired 16% of Sun System, a company active in the photovoltaic business (€2.5 million).
- During the first quarter, Sopaf perfected a series of purchases and sales of securities issued by Management&Capitali, Immsi and Conafi Prestitò, and as a result of such transactions, held 3.52%, 1% and 4.13% in the capital of such companies as of 31 March 2008.
- On 7 May 2008, the Bank of Italy authorized the rules for two funds: "Sopaf Small Cap Europe" and "Sopaf Global Private Equity Funds". The funds will be managed by Sopaf Capital Management SGR, the group's fund management company that is active in the alternative funds business.
Plan for acquiring and transferring own shares
The share purchase plan approved by the ordinary meeting of the shareholders on 27 November 2007 is in the completion phase, and as of 31 March 2008, the Group held 4,286,605 Sopaf S.p.A. shares.
The Board has thus proposed to submit a request to the forthcoming shareholders' meeting to secure authorization, for a period of no more than 18 months from the date of the shareholder resolution, pursuant to Article 2357-ter of the Italian Civil Code, so that the Board, in accordance with the law and regulations as from time to time applicable and with the regulations handed down by Borsa Italiana S.p.A. and in observance of the EU provisions on the subject, may sell the shares purchased through the plan, or shares already held by Sopaf, via the following alternatives:
1. cash transactions: in which case, the sales will be made in regulated markets and/or outside of regulated markets, at a price no less than 95% of the average prices of reference registered by the Borsa Italiana screen-based system in the three sessions preceding any single transaction;
2. transactions involving the exchange, conveyance, conferral or other transaction to make the shares available within the framework of business projects or extraordinary financing transactions. In such case, the economic terms of the transfer, including therein the valuation of the shares to be traded, shall be determined with the assistance of independent experts, in relation to the nature and characteristics of the transaction, including by taking into account the market trend of the prices of the Sopaf S.p.A. shares.
Notice of shareholders' meeting
The Board has approved a resolution to convene a meeting of the shareholders on 21 June (first session) and 28 June (second session) for the purpose of approving the 2007 financial statements. The shareholders' meeting will also be called upon to pass resolutions in relation to: (i) the plan for acquiring and transferring Sopaf S.p.A. shares; (ii) the appointment of an acting statutory auditor; and (iii) the appointment of a director.
The executive in charge of the preparation of the corporate accounting documents (Alberto Ciaperoni) declares pursuant to Paragraph 2, Article 154-bis of the Consolidated Financial Act that the accounting information contained in this press release corresponds to the documented results, books and accounting records.
* The area of consolidation has changed with respect to the period of reference; the changes are the result of changes within the portfolio of shareholdings and the use of a different consolidation criterion for several companies in which investments are held.
For additional information
Maria Antonietta Barelli
Sopaf S.p.A.
Tel: +39 (02) 72.14.24.29
Mobile: +39.335.620.0990
e-mail: mabarelli@sopafgroup.it
Laura La Ferla
PMS
Tel: +39 (02) 48000250
Cell: +39 329 4705000
e-mail: l.laferla@pmsgroup.it
* * *
The exhibits to this press release include: the profit and loss statement, the balance sheet, the statement of changes in consolidated financial position, the statement of changes in the holding company's financial position in relation to the year ending 31 December 2007; and the profit and loss statement, the balance sheet, and the statement of changes in consolidated financial position for the first quarter of 2008. The data set out in such exhibits have not been certified by the independent audit firm nor audited by the board of statutory auditors.
