Académique Documents
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Contents
General information
Page
Directors report
2-3
4-5
10 - 55
GENERAL INFORMATION
Directors
Samuel Dyer Ampudia
Christian Selmer
Samuel Barnaby Dyer Coriat
Synne Syrrist
Pavlos Aristodemou
Frixos Savvides
Gianfranco Castagnola
Chairman
Deputy Chairman
Company Secretary
Altruco Secretarial Limited
Arch. Kyprianou & Ag. Andreou,
Pavlides Court, 5th Floor
3036 Limassol,
Cyprus
Registered office
Arch. Kyprianou & Ag. Andreou,
Pavlides Court, 5th Floor
3036 Limassol,
Cyprus
Independent auditors
Ernst & Young Cyprus Ltd
Cyprus
-1-
DIRECTORS REPORT
The Directors submit their report together with the audited financial statements for the year ended 31
December 2008.
Activities
Camposol Holding PLC is the holding company of the Camposol Group (the Group). The Group
continued during the yerar its agricultural activities and is the largest business in the export market for
asparagus.
Financial Results
The profit attributable to the shareholders of the Company was USD 985.000, compared to USD
11.037.000 for the period since incorporation on 9 July 2007 to 31 December 2007.
The seasonal nature of the business means that the bulk of sales are made in the second half of each
year. Turnover in 2008 increased to USD 141 million, compared to sales for the whole of 2007 (including
the pre-incorporation period) of USD 126 million.
Future Developments
The Group sets as its strategic priorities for the five years 2009-2013 the maintenance of its position as a
global leader in the asparagus market and the diversification in new products, such as red table grapes
and manadarins, to satisfy demand.
Risk Management
Like other agricultural businesses the Group is exposed to risks, the most significant of which are natural
phenomena such as the cold and hot ocean currents of El Nino and La Nina which impact agricultural
production, adverse movements in the market prices for fruit and vegetables, interest rate risk and liquidity
risk.
The Group monitors and manages these risks through various control mechanisms. Detailed information
relating to risk management is set out in Note 32 to the financial statements.
Share capital
On 3 March 2008 the Company made a voluntary offer to the shareholders of Camposol AS to exchange
their shares and warrants for shares and warrants in Camposol Holding PLC. The offer period started on 5
March and expired on 14 March 2008. As a result of this reorganisation, the Company issued 27 925 070
ordinary shares to the shareholders of Camposol AS.
On 6 May 2008 the Company issued a further 1 908 750 shares for a total consideration of USD 15
million.
As stated in Note 21, the Company has granted 1 035 000 share options to directors and managers of the
Camposol Group .
In addition, 3.628.344 warrants granted to Dyer Coriat Holding S.L. in Camposol AS may be exercised to
acquire shares in Camposol Holding PLC.
In May 2008 the shares of the Company were listed on the Oslo Axess Stock Exchange.
-2-
Directors
The Directors of the Company at the date of this report are as shown on page 1.
The Directors who served during the year and up to the date of this report are the following:
Appointed
9 July 2007
8 November 2007
15 January 2008
15 January 2008
15 January 2008
15 January 2008
15 January 2008
15 January 2008
10 June 2008
Resigned
15 January 2008
15 January 2008
All of the Directors shall hold office until the next General Meeting and are eligible for re-appointment by
the shareholders.
Independent auditors
Ernst & Young Cyprus Ltd have expressed their willingness to continue in office. A resolution proposing
their re-appointment and fixing their remuneration will be put to the shareholders at the Annual General
Meeting.
-3-
-4-
-5-
Notes
USD 000
USD 000
Revenue
5
Cost of sales
6
Gross profit
Change in fair value of biological assets
16
Cost of crops during the period
16
Net adjustment from change in fair value of biological assets
Profit after adjustment for biological assets
(
(
(
(
(
(
(
140,705)
110,362)
30,343)
28,660)
11,584)
17,076)
47,419)
(
(
(
(
(
(
(
36,192)
25,952)
10,240)
16,945)
5,001)
11,944)
22,184)
Administrative expenses
Selling expenses
Other income
Other expenses
7
8
10
10
(
(
(
(
(
(
12,659)
16,286)
733)
4,806)
33,018)
14,401)
(
(
(
(
(
(
3,397)
4,472)
52828
309)
7,650)
14,534)
15
11
11
32
(
(
(
(
(
(
(
(
79)
1,975)
11,374)
)
4,042)
881)
104)
985)
(
(
(
(
(
(
(
(
741)
779)
798)
937)
85)
12,752)
1,715)
11,037)
985)
Operating profit
Share of loss of associated companies
Finance income
Finance costs
Change in fair value of derivative financial instrument
Currency translation differences
Profit before income tax
Income tax income / (expense)
Profit for the year
12
Attributable to:
Equity shareholders of the parent
Minority interests
Basic earnings per ordinary share
(expressed in US dollars per share)
Diluted earnings per ordinary share
(expressed in US dollars per share)
(
(
(
)
985)
(
(
(
11,037)
)
11,037)
13
0.034)
0.452)
13
0.029)
0.381)
-6-
As at 31 December
2008
2007
USD000
USD000
Notes
Assets
Non-current assets
Property, plant and equipment
Investments in associated companies
Intangible assets
Non-current portion of biological assets
14
15
3
16
Current assets
Prepaid expenses
Embedded derivative in debt instrument
Current portion of biological assets
Inventories
Other accounts receivable
Trade accounts receivable
Cash and short-term deposits
24
16
17
18
19
20
(
(
(
(
(
120,360)
274)
27,580)
99,962)
248,176)
(
(
(
(
(
94,057)
353)
27,042)
77,555)
199,007)
(
(
(
(
(
(
(
(
(
598)
741)
15,386)
58,037)
14,077)
25,822)
5,770)
120,431)
368,607)
(
(
(
(
(
(
(
(
(
1,785)
379)
9,133)
38,287)
19,447)
43,369)
89,766)
202,166)
401,173)
21 (
(
21
21 (
32 (
(
(
(
(
507)
212,318)
4,114
745)
11,093)
14,545)
221,136)
88)
221,224)
(
(
(
(
459)
189,453)
6,133
257
)
11,037)
207,339)
88)
207,427)
24 (
22 (
26 (
(
56,826)
10,094)
19,707)
86,627)
(
(
(
(
65,523)
12,262)
16,503)
94,288)
8)
9,528)
25,126)
9,638)
)
16,456)
60,756)
147,383)
368,607)
(
(
(
(
(
(
(
(
(
597)
68,613)
18,976)
8,283)
1,511)
1,478)
99,458)
193,746)
401,173)
Total assets
Equity and liabilities
Equity attributable to shareholders of the parent
Share capital
Share premium
Share warrants
Share options
Net unrealized loss on cash flow hedge
Retained earnings
Minority interests
Total equity
Non-current liabilities
Long- term debt
Deferred income tax
Other payables
Current liabilities
Accounts payable to related companies
Current portion of long-term debt
Trade payables
Other payables
Income tax payable
Bank loans
27
24
25
26
(
(
(
(
(
28 (
(
(
(
Total liabilities
Total equity and liabilities
The accompanying notes are an integral part of the financial statements.
-7-
(
(
(
Note
Incorporation 9 July 2007
Private placement
Discount on share premium
- fees and expenses
Warrants and options (Note 21)
Profit for the period
Balance as of 31 December 2007
Issue of shares
- fees and expenses
Net unrealized loss on cash flow
hedge)
Stock options
Options and warrants expired
Translations adjustment
Profit for the year
Balance as of 31 December 2008
21
32
21
21
Number
of shares
(
(
(
(
(
(
(
(
(
2,570)
26,771)
- )
- )
- )
- )
29,341)
3,063)
- )
Share
capital
USD000
(
38)
(
421)
(
- )
(
- )
(
- )
(
- )
(
459)
(
48)
(
- )
(
(
(
(
(
(
- )
- )
- )
- )
- )
32,404)
(
(
(
(
(
(
- )
- )
- )
- )
- )
507)
Share
premium
USD000
(
- )
( 183,435)
( 12,851)
(
6,833)
(
)
(
- )
( 189,453)
( 23.774)
(
909)
Share
options
USD000
(
)
(
)
(
)
)
(
257)
(
)
(
257)
(
)
(
)
Share
warrants
USD000
(
(
(
(
( 6,133
(
( 6,133
(
(
-
(
(
(
(
- )
- )
212.318)
(
(
(
(
(
(
(
(
(
(
(
(
)
)
)
561)
73)
)
)
745)
(2.019)
4.114)
-8-
)
)
)
)
)
)
)
)
)
)
)
(
)
)
Cash flow
hedge
USD000
(
(
(
(
(
(
(
(
(
(
(
(
(
(
)
)
)
)
)
)
)
)
)
(
(
(
(
(
(
(
(
(
Retained
earnings
USD000
)
)
)
)
)
11,037)
11,037)
)
)
11,093)
)
)
(
)
)
11,093)
(
(
(
(
(
)
)
2.092 (
431)
985)
14.545)
Equity
attributable to the
shareholders of
the parent
USD000
(
38)
(
183,856)
(
12,851)
(
6,833)
(
6,390)
(
11,037)
(
207,339)
(
23.822)
(
909)
(
(
(
(
11,093)
561)
)
431)
985)
221,136)
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
Minority
interests
USD000
- )
88)
- )
- )
- )
- )
88)
- )
- )
-
)
)
)
)
88)
(
(
(
(
(
(
(
(
(
Total
equity
USD000
38)
183, 944)
12,851)
6,833)
6,390)
11,037)
207,427)
23.822)
909)
(
(
)
(
(
(
11,093)
561)
( - )
431)
985)
221,224)
Notes
USD000
USD000
29
3
3
24
21
20
(
(
(
(
(
(
158,252)
174,308)
11,292)
8,774)
2,129)
20,703)
(
(
(
(
(
(
16,044)
45,507)
1,346)
918)
3,196)
33,087)
(
(
(
(
(
(
(
29,714)
1,746)
)
)
140
1,416)
29,904)
(
(
(
(
(
(
(
9,308)
)
149,520)
2,579)
727)
94)
155,428)
(
(
(
(
(
(
(
14,978)
7,000 )
)
320)
21,003)
62,050)
33,389)
(
(
(
(
(
(
(
)
30,346)
38)
)
176,999)
131,590)
278,281)
(
(
(
83,996)
89,766)
5,770)
(
(
(
89,766)
)
89,766)
-9-
CORPORATE INFORMATION
The consolidated financial statements of Camposol Holding PLC (hereinafter the Company) as of 31
December 2008 were approved by the Companys Board of Directors on 22 April 2009.
Camposol Holding PLC (hereinafter the Company) was incorporated in Cyprus on 9 July 2007, under the
name Halemondi Holdings Limited, as a private company under the provisions of the Cyprus Companies
Law, Cap. 113, and was converted to a Public limited liability company on November 8, 2007. The name
of the company was changed to Camposol Holding PLC on 11 February.2008.
th
The registered office of the Company is at Arch. Kyprianou & Ayiou Andreou, Pavlides Court 5 Floor,
3036 Limassol, Cyprus.
The Company remained dormant during the period 9 July to 31 December 2007.
On 3 March 2008 the Company made a voluntary offer to acquire all the issued shares in Camposol AS in
exchange for shares in the Company. The shareholders of Camposol AS became shareholders in the
Company, holding the same number of shares and warrants in the Company as they did in Camposol AS.
As a result of this exchange, Camposol AS became a wholly-owned subsidiary.
This transaction does not represent a business combination and is outside the scope of IFRS 3 (2007).
There is no economic substance in terms of any real alteration to the composition or ownership of the
Group. Accordingly the consolidated financial statements are presented as a continuation of the Camposol
AS group using the pooling of interests method. In applying the pooling of interests method, the financial
statement items of the combining enterprises for the period in which the combination occured and for any
comparative periods disclosed are presented as if they had been combned from the beginning of the
earliest period presented.
As from May 2008 the shares of the Company are listed on the Oslo Axess stock exchange.
Camposol AS was established on 5 September 2007, and financed through a Private Placement on 8
October 2007. On 17 October 2007 Camposol AS acquired 100% of the shares in Siboure Holding Ltd
(before Siboure Holdings Inc.) which held 100% of Camposol S.A.
Camposol AS was liquidated on 22 December 2008 with no impact on the Groups financial statements as
all rights and obligations were transferred to Camposol Holding PLC.
The subsidiaries and their activities are as follows:
Company
Camposol S.A.
Campoinca S.A.
Preco Precio Economico S.A.C.
Sociedad Agricola Las
Dunas S.R.L.
Prodex S.A.C.
Balfass S.A.
Vegetales del Norte S.A.C.
Muelles y Servicios Paita S.A.C.
Marinazul S.A.
Marinasol S.A.
Camposol Europa S.L.
Crofton Finance Ltd.
Madoca Corp.
Grainlens Ltd
Blacklocust Ltd
Siboure Holding Ltd
Principal
Activity
Country of
incorporation
Agribusiness
Agriculture
Retail
Peru
Peru
Peru
Agriculture
Agriculture
Agriculture
Agriculture
Services
Shrimp farming
Fish canning
Distribution
Real state
Holding
Holding
Holding
Holding
Peru
Peru
Peru
Peru
Peru
Peru
Peru
Spain
British Virgin Islands
Panama
Cyprus
Cyprus
Cyprus
10
99.99
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
Mar verde
Huangala - Terra
Agricultor
Gloria
Agroms
Pur Pur
Vir - San Jos
Compositan
Yakuy Minka
Santa Ana
Santa Anita
Santa Julia
Mara Auxiliadora
La Merced
Ocoto Alto
Ocoto Bajo
Ica
Tumbes
Geographic Area
La Libertad
Piura
La Libertad
La Libertad
La Libertad
La Libertad
La Libertad
La Libertad
La Libertad
Piura
Piura
Piura
Piura
Piura
Piura
Piura
Ica
Tumbes
2007
2,496
2,662
1,726
1,018
414
246
416
3,778
2,762
3,370
128
2,105
1,980
1,000
112
31
175
462
24,881
2,496
2,662
1,726
1,018
414
246
416
3,778
2,762
3,370
404
19,292
During 2008 the Group acquired additional agricultural land to support future growth.
The Group owns the following planted areas:
Area in Hectares (Ha)
2008
2007
Asparagus
Avocados
Mangoes
Grapes
Tangerine
2,993
1,207
415
97
57
4,769
3,318
840
499
4,657
The Group also has 560 Ha (400 Ha in 2007) of area ready to plant pepper and 253 Ha for Shrimp
farming. As of 31 December 2008 the Group did not have any pepper planted in its designated area,
while at 31 December 2007 it had 268 Ha.
11
c) Basis of consolidation
The consolidated financial statements comprise the financial statements of the Company and its
subsidiaries as at 31 December 2008.
(i) Subsidiaries and business combinations
Subsidiaries are those enterprises controlled by the Group regardless of the amount of shares owned by
the Group. Control exists when the Group has the power, directly or indirectly, to govern the financial and
operating policies of an enterprise so as to obtain benefits from its activities. Subsidiaries are consolidated
from the date on which control is transferred to the Group and cease to be consolidated from the date on
which control is transferred out of the Group.
The purchase method of accounting is used to account for the acquisition of subsidiaries. The cost of an
acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities
incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Identifiable
assets acquired and liabilities and contingent liabilities assumed in a business combination are measured
initially at their fair values at the acquisition date. The excess of the cost of acquisition over the fair value
of the Groups share of the identifiable net assets acquired is recorded as goodwill. If the cost of
acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is
recognized directly in the income statement.
The financial statements of subsidiaries are prepared for the same reporting period as the parent
company, using consistent accounting policies. All intra-group balances and transactions, including
unrealized profits and losses, are eliminated in full.
15
16
Intangible assets
(i) Goodwill
Goodwill is inititially measured at cost being the excess of the cost of the business combination over the
Groups share of the net fair value of of the acquirees identifiable assets , liabilities and contingent
liabilities at the date of acquisition. Goodwill on acquisition of subsidiaries is included in intangible assets.
After initial recognition, goodwill is recognised at cost less any accumulated impairment losses.
17
18
19
An associate is an entity in which the Group has significant influence and which is neither a subsidiary nor
an interest in a joint venture.
The investments in shares of the associated companies are recorded using the equity method. Under the
equity method, the investment in the associate is carried at cost plus the post acquisition changes in the
Groups share of net assets of the associate. Goodwill relating to the associate is included in the carrying
amount of the investment and is not amortised or separately tested for impairment. Consequently, the
Groups participation in the associates profits or losses is recognized in the results of the period in which
they occur. In case the associated companies are not able to meet payments for financial obligations
guaranteed by the Group, additional losses woud be recorded.
Where there has been a change recognised directly in the equity of the associate, the Group recognises
its share of any changes and discloses this, when applicable, in the statement of changes in equity.
Unrealised gains and losses resulting from transactions between the Group and the associate are
eliminated to the extent of the interest in the associate.
The share of profit of associates is shown on the face of the income statement. This is the profit
attributable to equity holders of the associate and therefore is profit after tax and minority interests in the
subsidiaries of the associates.
After application of the equity method, the Group determines whether it is necessary to recognise an
additional impairment loss on the Groups investment in its associates. The Group determines at each
balance sheet date whether there is any objective evidence that the investment in the associate is
impaired. If this is the case the Group calculates the amount of impairment as the difference between the
recoverable amount of the associate and its carrying value and recognises the amount in the income
statement.
j)
Biological assets
The biological assets of asparagus, avocados, mangoes, artichokes, pepper, tangerine, grapes and
shrimp are stated at their fair value less point of sale costs. Land, and related facilities are accounted for
under property, plant and equipment.
Fair value is determined using the present value method at current conditions for asparagus, avocados,
mangoes, artichokes, pepper and shrimp.Tangerine and grape, whose fair value cannot be reliably
measured, are stated at cost. Changes in fair value are recognized in income in the period in which they
arise.
For the present value method, assumptions are used to estimate the plantation volumes, cost per ton, and
depletion. Cost of delivery includes all costs associated with getting the harvested agricultural and shrimp
produce to the market, being harvesting and allocated fixed overheads. Future cash flows are discounted
using the pre-tax weighted average cost of capital.
k) Inventories
Inventories are valued at the lower of average cost and net realizable value.
The cost of biological products is determined as the fair value less estimated point of sale costs at the time
of harvest..
The net realizable value is the estimated sale price in the ordinary course of business, less estimated
costs to place inventories in selling condition and commercialization and distribution expenses.
20
Preserved products
The provision is estimated on an item by item basis or for groups of items with similar characteristics
(same crop, market and others).
l)
Accounts receivable
Current trade receivables are recognized initially at fair value and subsequently remeasured at amortized
cost using the effective interest method, less any provision for impairment.
A provision for impairment of trade receivables is estimated when there is objective evidence that the
Group will not be able to collect all amounts due according to the original terms of the invoice. The amount
of the provision is the difference between the carrying amount and the present value of the recoverable
amounts and this difference is recognized in the income statement. Bad debts are written off when they
are assessed as uncollectible.
m) Share capital
Ordinary shares are classified as equity. Any excess over the par value of issued shares is classified as
share premium.
n) Provisions
Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a
past event, it is probable that an outflow of resources will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation. If the effect of the time value of money is material,
provisions are determined by discounting the expected future cash flows at a pre tax rate that reflects
current market assessments of the time value of money and, where appropriate, the risks specific to the
liability. Where discounting is used, the increase in the provision due to the passage of time is recognized
as a financial expense.
Workers profit sharing and other employee benefits
In accordance with Peruvian Legislation the Group is required to provide for workers profit sharing
equivalent to 10% of taxable income in Peru of each year. This amount is charged to the income
statement and is deductible for income tax purposes.
The workers profit sharing liability is presented in Other payables in the balance sheet. The liability is
computed using the balance sheet liability method and reflects the effects of temporary differences
between asset and liability balances for accounting purposes and those determined for tax purpose. The
liability is measured using the workers profit sharing rates expected to be applied to the taxable income in
the years in which these differences are recovered or eliminated. Effects corresponding to changes in
workers` profit sharing rates are recognized in the results of the year in which the change is known.
The Group has no pension or retirement benefit schemes.
21
where the deferred income tax liability arises from the initial recognition of goodwill or of an asset
or liability in a transaction that is not a business combination and, at the time of the transaction,
affects neither the accounting profit nor taxable profit or loss; and
in respect of taxable temporary differences associated with investments in subsidiaries, associates
and interests in joint ventures, where the timing of the reversal of the temporary differences can be
controlled and it is probable that the temporary differences will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry forward of
unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be
available against which the deductible temporary differences, and the carry forward of unused tax credits
and unused tax losses can be utilised except:
where the deferred income tax asset relating to the deductible temporary difference arises from the
initial recognition of an asset or liability in a transaction that is not a business combination and, at the
time of the transaction, affects neither the accounting profit nor taxable profit or loss; and
in respect of deductible temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, deferred income tax assets are recognised only to the
extent that it is probable that the temporary differences will reverse in the foreseeable future and
taxable profit will be available against which the temporary differences can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of
the deferred income tax asset to be utilised. Unrecognised deferred income tax assets are reassessed at
each balance sheet date and are recognised to the extent that it has become probable that future taxable
profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the
year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been
enacted or substantively enacted at the balance sheet date.
Deferred income tax relating to items recognised directly in equity is recognised in equity and not in
the income statement.
Deferred income tax assets and deferred income tax liabilities are offset, if a legally enforceable right
exists to set off current tax assets against current income tax liabilities and the deferred income taxes
relate to the same taxable entity and the same taxation authority.
p) Trade payables
Trade payables are recognized initially at fair value and subsequently measured at amortized cost using
the effective interest method.
22
Contingencies
Contingent liabilities, other than those recognized in a business combination, are not recognized in the
financial statements. They are disclosed in the notes to the financial statements unless the possibility of
an economic outflow is remote. A contingent asset is not recognized in the financial statements, but is
disclosed where an inflow of economic benefit is probable.
s) Revenue recognition
Revenue comprises the fair value of the consideration received or receivable for the sale of goods and
services in the ordinary course of the Group activities. Revenue is shown net of value-added tax, returns,
rebates and discounts and after eliminating sales within the Group.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group
and the revenue can be reliably measured. The following specific recognition criteria must also be met
before revenue is recognised:
Sale of goods
Sales of goods are recognized when all risks and rewards of ownership have been transferred to the
buyer, usually on delivery of the goods Sales of goods comprise:
Domestic sales
Revenue is recognized on delivery.
23
The cost of sales that corresponds to the cost of production of goods sold, and is recorded
simultaneously with the recognition of revenue.
Other costs and expenses are recognized as accrued and recorded in the periods to which they are
related.
In Peru, Camposol S.A and Marinazul are beneficiaries of a simplified procedure for import duty refund
(Drawback) of customs duties, at a rate of 5% of revenues until 2008. As a counter measure to the global
financial crisis, the Peruvian authorities have increased the Drawback rate for 2009 to 8%.
u) Financial assets
The Groups financial assets comprise cash and bank short-term deposits, trade and other accounts
receivables, and derivative financial instruments.
(i) Initial recognition
The Group recognizes financial assets on its balance sheet when, and only when, it becomes a party to
the contractual provisions of the instrument.
Financial assets are initially recognized at cost, which is the fair value of consideration given including,
any transaction costs incurred.
Financial assets and liabilities are offset and the net amount is reported in the balance sheet only when
there is a legally enforceable right to set off the recognized amounts and there is an intention to settle on a
net basis, or realize the asset and settle the liability simultaneously.
(ii) Subsequent measurement
Loans and receivables are loans and receivables created by the Group providing goods to a debtor and
are not quoted on an active market. They are carried at amortized cost using the effective interest method.
Financial liabilities are carried at amortized cost using the effective interest method.
(iii) De-recognition
A financial asset (or, where applicable a part of a financial asset or part of a group of similar financial
assets) is derecognised when:
the rights to receive cash flows from the asset have expired; or
the Group has transferred its rights to receive cash flows from the asset or has assumed an obligation
to pay the received cash flows in full without material delay to a third party under a pass-through
arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the
asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of
the asset, but has transferred control of the asset.
24
Derivatives
Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are
subsequently remeasured at their fair value at each balance sheet date. Embedded derivatives
incorporated in host contracts of financial instruments are accounted for at its fair value separately from
the host contract if such embedded derivative is not closely related to the host contract.
Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when
the fair value is negative
Any gains or losses arising from changes in fair value on derivatives that do not qualify for hedge
accounting and the ineffective portion of an effective hedge, are taken directly to the income statement.
The Group uses forward exchange contracts as hedges of its exposure to foreign currency risk in
forecasted transactions and firm commitments . For the purpose of hedge accounting, a hedge is
classified as cash flow hedge when hedging exposure to variability in cash flows that is either attributable
to a particular risk associated with a recognised asset or liability or a highly probable forecast transaction
or the foreign currency risk in an unrecognised firm commitment.
For hedges which meet the strict criteria for hedge accounting, the effective portion of the gain or loss on
the hedging instrument is recognised directly in equity, while any ineffective portion is recognised
immediately in the income statement. Amounts taken to equity are transferred to the income statement
when the hedged transaction affects profit or loss, such as when the hedged financial income or financial
expense is recognised.
v) Dividend distribution
Dividend distribution to the Groups shareholders is recognized as a liability in the consolidated financial
statements in the period in which the dividends are approved by the shareholders.
w) Cash and cash equivalents
For the purposes of the cash flow statement, cash and cash equivalents comprise cash in hand and shortterm deposits held with banks with an original maturity of three months or less and which are subject to
insignificant risk of changes in value.
(x) Share-based payments
The Group operates a number of equity-settled share-based compensation plans. The cost of equitysettled transactions is measured by reference to the fair value of the equity instruments at the date on
which they are granted using the Black and Scholes Merton model. The cost, together with the
corresponding increase in equity, is recognized on a straight-line basis over the vesting period in which
the performance and/ or service conditions are fulfilled. At each balance sheet date, the Group revises its
estimates of the number of options that are expected to vest and recognizes the change in cost if any, in
the income statement, with a corresponding adjustment to equity.
(y) Segment Reporting
A business segment is a distinguishable component of the Group engaged in providing products or
services that are subject to risks and returns that are different from those of other business segments. A
geographical segment is a distinguishable component of the Group engaged in providing products or
service within a particular econmic environment that are subject to risk and returns that are different from
those segments operating in other economic environment.
Management considers that the Group operates in one business segment, which is the production and
sale of agricultural products.
25
BUSINESS COMBINATIONS
On 17 October 2007, Camposol AS acquired 100% of the share capital of Siboure Holding Inc. which was
the parent of the Camposol S.A. group.
The fair value of the identifiable assets and liabilities of the acquiree as at 17 October 2007 and the
corresponding carrying amounts immediately before acquisition were as follows:
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
Purchase consideration:
Cash paid
Direct costs relating to the acquisition
Fair value
USD 000
2,579)
86,012)
9,566)
1,428)
353)
28,538)
69,704)
43,855)
39,570)
10,768)
7,548)
29,694)
154,455)
16,279)
170,734)
Acquirees
carrying amount
USD 000
(
2,579)
(
50,039)
(
-)
(
1,428)
(
353)
(
27,786)
(
69,704)
(
43,855)
(
39,570)
(
4,272)
(
3,165)
(
29,694)
119,043)
(
)
(
119,043)
148,196)
1,324)
149,520)
Fair value of
- warrants to DCH (Note 21)
- discount on share premium paid by DCH
- discount on share premium paid by PL&F
Total consideration
6,133)
12,851)
2,230)
170,734)
(154,455)
Goodwill
16,279)
149,520)
(2,579)
(
(146,941)
At the time of the acquisition, Dyer Coriat Holding S.L (DCH), the founding shareholder, was granted the
right to subscribe for shares in Camposol AS, for a discounted price compared to the price paid by the
other investors in the private placement by Camposol AS. In addition DCH was granted warrants to
subscribe for additional shares, as described in Note 21.
The discounted price represents a type of finder's fee for identifying the acquisition of Camposol SA. and
represents an equity-settled share-based payment. The cost of these services was included in the cost of
the combination and their fair value is measured as the difference between the price per share paid by the
other shareholders and the cash per share paid in by the identified shareholder for the total shares
acquired.
26
Cost
2008
Goodwill
Customer relationships
Software
Total
(
(
(
(
16,279)
9,566)
3,174)
29,019)
(
(
(
(
- )
1,340)
99)
1,439)
(
(
(
(
16,279)
8,226)
3,075)
27,580)
2007
Goodwill
Customer relationships
Software
Total
(
(
(
(
16,279)
9,566)
1,428)
27,273)
(
(
(
(
- )
231)
- )
231)
(
(
(
(
16,279)
9,335)
1,428)
27,042)
Goodwill
The goodwill is attributable mainly to the workforce of the acquired business and the systems and
processes of the acquired companies which do not meet the criteria to be separately recognized in the
financial statements as per IFRS.
An impairment test for goodwill was performed by comparing the value in use of the assets acquired and
their carrying value (including goodwill). To estimate the value in use, the Company has used the following
assumptions:
Projections are based on the Companys forecasts approved by management
A 10-year term of cash flows has been used in the calculation, as the forecasted cash flows can be
based on reasonable and reliable assumptions.
Projections do not include cash inflows or outflows from financing activities or from income tax
payments.
Future cash flows are pre-tax and are estimated at current values (no effect due to inflation has been
considered), thus, the discount rate is a pre-tax real rate.
The discount rate is deemed to be the Companys WACC of 10,7% as this rate is affected by the
specific industry and market risks, therefore it represents market current conditions.
Goodwill is allocated to a single cash-generating unit. The results of reportable segments do not show
significant dispersion, therefore no significant difference would arise from performing the calculation at
a lower level of cash- generating units.
Cash flows projections encompass the entire cash flows expected to be generated in the normal
course of business, including the cash flows that relate to biological assets. All non-current assets
have been grouped as a single asset.
The fair value of the discount in share premium is calculated as the difference between share
premium paid by the investors and share premium paid by the founding shareholder. The fair value of
warrants and options was estimated by external profesional valuers..
Customer relationships
The relationships with customers established over time become a valuable intangible for the Group. The
loyalty of the customers has had a positive impact on sales and profits during the last 10 years of
operation of Camposol Group., allowing it to have foreseeable growth.
27
SEGMENT REPORTING
The Group is engaged in producing, processing and commercializing a number of agricultural products, as
fresh, preserved and frozen, which are mainly exported to European markets and the United States of
America. Since all products have similar risks and returns management considers that there is only one
reportable segment.
The products include asparagus, avocado, piquillo pepper, mangoes, arthichoke and shrimp. These are
further distinguished in fresh, canned and frozen products. The Group has decided to discontinue the
production of artichoke and to plant grapes (will be harvested between December 2009 and January
2010) and tangerines which need at least 3 years to start production.
All production and related assets are in Peru.
The analysis of sales below is based on the country / area in which the customer is located. The 2007
amounts are for the period 9 July to 31 December 2007 and the 2008 amounts for the whole year 2008.
Europe
USA
Peru
Other
28
2008
USD 000
2007
USD 000
90,049
48,520
877
1,259
140,705
25,132
9,942
226
892
36,192
Year 2008
Revenues
Asparagus
Avocado
Artichoke
Pepper
Mango
Shrimp
Other
Total
USD 000
USD 000
USD 000
USD 000
USD 000
USD 000
USD 000
USD 000
62,073
31,611
16,964
13,255
8,620
5,366
2,816
140,705
6,599
20,500
999
530
1,860
771
(916)
30,343
Asparagus
Avocado
Artichoke
Pepper
Mango
Shrimp
Other
Total
USD 000
USD 000
USD 000
USD 000
Gross profit
Period in
2007
Revenues
USD 000
USD 000
USD 000
USD 000
24,402
5,929
4,746
264
827
24
36,192
7,665
1,168
751
195
502
(41)
10,240
Gross profit
REVENUE
Revenue represents the sale of fresh, preserved and frozen biological products and the rendering of
services. The 2007 revenues are for the period 9 July to 31 December 2007 and the 2008 revenues for
the whole year 2008.
2008
USD 000
Asparagus
Avocado
Artichoke
Pepper
Mango
Shrimp
Other
Total
Period in 2007
USD 000
62,073
31,611
16,964
13,255
8,620
5,366
2,816
140,705
24,402
5,929
4,746
264
827
24
36,192
Included within asparagus, avocado and mango revenue is the net change in the fair value of the
embedded derivatives - Note 2(s), which amounted to USD 491,000 in 2008 (USD 627,000 for 2007).
The avocado harvest season in 2007 ended in September, prior to the business combination.
6
COST OF SALES
29
(
(
(
(
2008
USD 000
Period in 2007
USD 000
73,210)
38,125)
4,954)
(5,927)
110,362)
(
(
(
(
15,050)
11,234)
875)
(1,207)
25,952)
ADMINISTRATIVE EXPENSES
2008
USD 000
Personnel expenses including profit sharing (Note 9)
Professional fees
Transport and telecommunications
Travel and business expenses
Electricity, maintenance and security
Expense of share based payments - options
Directorss remuneration
Auditors remuneration
Rent of computer equipment
Depreciation (Note 14)
Amortization of computer software (Note 3)
Other expenses
Total
(
(
(
(
(
(
(
(
(
(
(
(
4,891)
2,508)
1,231)
773)
742)
561)
243)
370
210)
144 (
99)
887)
12,659)
Period in 2007
USD 000
(
(
(
(
(
(
(
(
(
(
(
1,936)
231)
58)
362)
65)
257)
78)
320
32)
10)
)
48)
3,510)
SELLING EXPENSES
2008
USD 000
Freight
Amortization of customer relationships (Note 3)
Personnel expenses including profit sharing (Note 9)
Customs
Travel and business expenses
Insurance
Samples, promotions and fairs
Rents and telephone
Third-party services
Depreciation (Note 14)
Other expenses
Total
9
(
(
(
(
(
(
(
(
(
(
(
(
11,930)
1,109)
912)
842)
579)
292)
236)
112)
103)
12)
159)
16,286)
Period in 2007
USD 000
(
(
(
(
(
(
(
(
(
(
(
(
2,142)
231)
324)
731)
97)
98)
95)
65)
658)
)
31)
4,472)
PERSONNEL EXPENSES
2008
USD 000
Salaries and wages
Vacations
Other employees benefits
Share based payments: options
Other expenses
Workers profit sharing (Note 2 (n)
Total
Personnel expenses are allocated as follows:
Cost of sales (Note 6)
Administrative expenses (Note 7)
Directors remuneration Administrative expenses (Note7)
Selling expenses (Note 8)
30
Period in 2007
USD 000
(
(
(
(
(
(
(
38,682)
1,929)
1,168)
561)
2,024)
193)
44,171)
(
(
(
(
(
(
(
11,244)
504)
175)
257)
386)
1,006)
13,572)
(
(
38,125)
4,891)
243
912)
44,171)
(
(
11,234)
1,936)
78
324)
13,572)
(
(
(
(
Other expenses
Provision for doubtful receivables (Notes 18 and 19)
Credit for value added tax not used
Loss on currency derivative
Loss from sale of property, plant and equipment
Other
Period in 2007
USD 000
(
(
(
211)
21
- )
501)
733)
(
(
(
(
54)
19
349)
106)
52,828
(
(
(
(
(
(
3,435)
165)
144)
56)
1,062)
4,806)
(
(
(
(
(
(
( 113)
- )
- )
23 )
173)
309)
The loss on the currency derivative includes the net receipts from the counterparty of USD530,000 and
the loss of USD 674.000 corresponding to the ineffective portion of the hedge (Note 32 a)
11 FINANCE INCOME AND COSTS
2008
USD 000
Income
Interest on bank time deposits
Change in value of embedded derivative in loan (Note 24)
Other finance income
Costs
Interest on bank loans (Notes 24 and 28)
Interest on finance leases
Levy on financial transactions
Interest of suppliers financing
Bank fees
Other finance costs
Period in 2007
USD 000
(
(
(
(
1,416)
362)
197)
1,975)
(
(
(
(
94)
379)
306)
779)
(
(
(
(
(
(
(
8,551)
871)
760)
355)
59)
778)
11,374)
(
(
(
(
(
(
(
489)
73)
)
)
103)
133)
798)
12 INCOME TAX
Income statement
2008
USD 000
Current tax
Deferred tax
Tax income / (expense)
(
(
(
14)
118)
104)
Period in 2007
USD 000
(
(
(
221)
1,494)
1,715)
The only Group company that has generated taxable income was Marinazul S.A. All other companies in
the Group incurred tax losses for which a deferred tax asset was recognised Note 22.
The standard rate of Cyprus income tax for 2008 and 2007 is 10% and for subsidiaries in Peru 15%. The
rate of tax in 2007 for Camposol AS was 28%.
31
881)(
(88))(
(44))(
(1,181))(
1,683
(266))(
104
(
12,752)()
(3 571)
1,658
(57))()
124
131
(1,715)))
Profit before income tax only corresponds to Peruvian subsidiaries, therefore taxation charge in the
income statement is based on the Peru tax rate of 15%. The tax rate for the parent in 2007 was 28% since
the ultimate holding company was a tax resident of Norway.
13 BASIC AND DILUTED EARNINGS PER SHARE
Basic earnings per share
Basic earnings per share are calculated by dividing net profit attributable to equity holders of the parent
by the weighted average number of ordinary shares in issue during the year.
2008
2007
985
29,175
0,034
11,037
24,445
0,452
The Company was incorporated on 9 July 2007. One class of 2,570,000 initial shares do not have the right
to vote or participate in dividend distribution and are not taken into account for the purposes of
determining earnings per share.
The share capital was increased through the share exchange with Camposol AS shareholders in March
2008 by 27,925,070 shares and by a private placement towards Fondo de Inversion Agroindustrial
(FIDAF) with 1,908,750 shares. (Note 21).
Diluted earnings per share
Diluted earnings per share are calculated by adjusting the weighted average number of ordinary shares
outstanding to assume conversion of all dilutive potential ordinary shares. The Company has granted
share options which are dilutive. The Company determines the number of potential shares using the
average market share price of the Companys shares for the year.
2008
2007
985
29,175
4,402
11,037
24,445
4,542
33,577
0,029
28,987
0,381
Land
USD 000
Buildings
and other
constructions
USD 000
Plant
and
equipment
USD 000
Furniture,
fixtures
and
other
equipment
USD 000
(
(
(
(
(
34,460)
3,073)
)
316)
805)
(
(
(
(
(
13,975)
125)
53)
130)
11,886)
(
(
(
(
(
31,926)
4,302)
160)
44)
6,171)
(
(
(
(
(
38,654)
25,803)
42,195)
Vehicles
USD 000
Construction in
progress
USD 000
Total
USD 000
2,458)
946)
2)
10)
1,414)
(
(
(
(
(
1,619)
1,187)
247)
18)
697)
(
(
(
(
(
10,298)
21,349)
- )
338)
20,973)
(
(
(
(
(
94,736)
30,982)
462)
452)
)
4,806)
3,238)
11,012)
125,708)
2008
Cost
Opening balance
Additions
Retirements
Adjustments
Transfers
Balance as of
31 December
Cumulative Depreciation
Opening balance
Charge for the year
Retirements
(
(
(
)
)
)
(
(
(
119)
595)
52)
(
(
(
317)
3,104)
31)
(
(
(
109)
772)
1)
(
(
(
134)
639)
182)
(
(
(
)
)
)
(
(
(
679)
5,110)
266)
Adjustments
Balance as of
31 December
10)
93)
15)
107)
175)
672)
3,297)
895)
484)
5,348)
38,654)
25,131)
38,898)
3,911)
2,754)
11,012)
120,360)
2007
Cost
Opening balance
Additions as of acquisition
date,
Additions after the acquisition
Retirements
Transfers
Balance as of
31 December
Cumulative Depreciation
Charge for the year
Retirements
Balance as of
31 December
Net book value
(
(
(
(
33,454)
1,090)
)
84)
(
(
(
(
13,762)
159)
)
54)
(
(
(
(
27,450)
565)
458)
4,369)
(
(
(
(
4,286)
342)
)
2,170)
(
(
(
(
1,561)
184)
126)
)
(
(
(
(
5,499)
6,968)
)
2,169)
(
(
(
(
86,012)
9,308)
584)
)
34,460)
13,975)
31,926)
2,458)
1,619)
10,298)
94,736)
119)
)
(
(
523)
206)
(
(
109)
)
(
(
134)
)
(
(
)
)
(
(
885)
206)
679)
10,298)
94,057)
(
(
)
)
(
(
119)
317)
109)
134)
34,460)
13,856)
31,609)
2,349)
1,485)
a) The additions to land are described in Note 1. Additions during 2008 also include Project Yakuy
Minka (7A) for USD 17,4 million which consists of land and land preparation, an irrigation channel and
irrigation equipment for crops on 3,654 hectares. The extension of the structure constructed for the water
transfer was of 7.4 kilometers. The total cost of the irrigation channel was USD 10.1 million and its useful
life was estimated at 70 years, with nil residual value.
b) As of 31 December 2008 the balance of construction in progress comprised mainly complementary
works to main 7A Project of USD 3.5 million and Fish preserving plant of USD 3.9 million.
c) As of 31 December 2008, the land, property, plant and equipment captions include fixed assets
acquired under finance leases for USD 5,465,000 (USD 7,561,000 in 2007) net of their corresponding
cumulative depreciation, which are secured on the same assets.
d) As of 31 December 2008, the Group has insured its property, plant and equipment up to a value of
USD 40 million. Management believes that this policy is consistent with international practices in the
industry and takes into account the nature of the assets in the estimating the risk of eventual losses.
33
2008
USD 000
Cost of sales (Note 6)
Administrative expenses (Note 7)
Selling expenses (Note 8)
Total
(
(
(
(
4,954)
144)
12)
5,110)
(
(
(
(
875)
10)
)
885)
40.0
50.0
2008
USD 000
2007
USD 000
274
274
353
353
(
(
(
(
2,219)
1,534)
3,041)
43)
685)
2007
USD 000
(
(
(
(
2,785)
1,878)
3,134)
174)
907)
On 1 December 2006, Camposol S.A. and Mission Produces Inc invested in the incorporation of Mission
Asparagus LLC (Mission Asparagus), a company based in
the United States of America, to
commercialize asparagus in the west coast of this country.
In 2008, the Group initially capitalized a receivable arising from 2007 sales of fresh asparagus to Mission
Asparagus in the amount for USD 1,315,000. Subsequently, the investment in Mission Asparagus was
transferred to Mission Produces Inc without a cash consideration, in exchange for the latter assuming all
debts, liabilities, guarantees and future claims arising from such investment.
34
2008
USD 000
Change in fair value of biological assets
Net cost of permanent plantations
and maintenance
Deferred income tax and workers profit sharing
Net effect due to the IAS 41 adjustment
28,660)
16,945)
(
(
(
11,584)
4,192)
12,884)
(
(
(
5,001)
2,807)
9,137)
2007
USD 000
11,456)
4,901)
(
(
(
(
(
(
377)
10)
609)
11,234)
350)
11,584)
(
(
(
(
(
(
331)
547)
162)
4,847)
154)
5,001)
Had the Group not applied IAS 41, the amortization of permanent plantations for the 2008 would have
been USD 1,823 thousand (USD 381 thousand for 2007).
The main assumptions used to estimate the fair values of the biological assets were as follows:
Asparagus:
72 lots in Agroms, Pur Pur, Mar Verde, Gloria, Agricultor, Aeropuerto, Oasis, San Jose,
Sincromax, Terra and Yakuy Minka.
Lots have a useful life of 8 years for white asparagus and 10 for green asparagus. The white
asparagus parcels are transformed to green asparagus at the end of the 8 years.
Each harvest cycle lasts 6 months.
Assumes reduction of production in year 2018 due to the Fenomeno del Nio.
Avocados:
25 lots in Frusol and Agroms.
Lots have a useful life of 20 years.
Every harvest cycle lasts 1 year.
Assumes reduction of production in year 2018 due to the Fenomeno del Nio
Lots have their first harvest after 3 years from planting
Mangoes:
8 lots in Atypsa, Balfass and Dunas.
Parcels have a useful life of 20 years.
Every harvest cycle lasts 1 year.
Assumes reduction of production in year 2018 due to the Fenomeno del Nio.
Lots have their first harvest after 3 years from planting
35
(
(
(
(
(
(
(
(
3,318)
840)
499)
268)
224)
)
)
5,149)
Additions /
Deductions
Estimated
change in
market value
USD000
(
(
(
(
(
(
(
(
57,470)
18,370)
7,798)
871)
2,179)
)
)
86,688)
Hectares
(
(
(
(
(
(
(
(
328)
353)
84)
2)
21)
51)
45)
56)
Estimated
change in
market vaue
USD000
Balance as of
December 31, 2008
Estimated
change in
Hectares market vaue
USD000
Less
current
portion
USD000
Non
current
portion
USD000
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
14,141)
14,215)
1,747)
37)
976)
888)
150)
28,660)
2,990)
1,193)
415)
266)
245)
51)
45)
5,205)
(
(
(
(
(
(
(
(
71,611)
32,585)
6,051)
908)
3,155)
888)
150)
115,348)
7,885)
3,234)
204)
908)
3,155)
)
)
15,386)
63,726)
29,351)
5,847)
)
)
888)
150)
99,962)
2007
On acquisition date
Estimated
change in
Hectares
market value
USD000
Asparagus
Avocados
Mangoes
Pepper
Artichokes
Shrimp
(
(
(
(
(
(
(
2,673)
858)
499)
235)
835)
250)
5,350)
(
(
(
(
(
(
(
43,465)
15,042)
6,998)
1,117)
1,729)
1,392)
69,743)
Additions
Deductions
Hectares
(
(
(
(
(
(
(
645)
18)
)
33)
835)
26)
201)
Estimated
change in
market value
USD000
Balance as of
December, 31 2007
Estimated
change in
Hectares market vaue
USD000
Less
current
portion
USD000
Non
current
portion
USD000
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
14,005)
3,328)
800)
246)
1,729)
787)
16,945)
3,318)
840)
499)
268)
- )
224)
5,149)
(
(
(
(
(
(
(
57,470)
18,370)
7,798)
871)
- )
2,179)
86,688)
4,750)
476)
857)
871)
)
2,179)
9,133)
52,720)
17,894)
6,941)
)
)
)
77,555)
The increase of USD 28.7 million is explained mainly due to the addition of new planted areas of
asparagus and avocado.
36
Finished products:
Artichokes
Asparagus
Peppers
Avocados
Mangoes
Other
Supplies
Containers
Raw material and others
Product in process
Land pre-operative labors
In-transit raw material and supplies
2008
USD 000
2007
USD 000
6,638
20,997
4,544
95
420
1,104
33,798
9,303
9,441
2,275
98
3,122
58,037
8,722
5,068
3,190
221
142
266
17,609
6,292
4,961
1,165
5,457
1,811
992
38,287
2008
USD 000
2007
USD 000
Prepayments to suppliers
Agreement with Peru Land & Farming
Claims to insurance entities
Other
Less:
Allowance for doubtful accounts
(
(
(
(
(
(
(
(
(
5,315)
4,580)
1,781)
1,232)
680)
)
)
1,033)
14,621)
(
(
(
(
(
(
(
(
(
6,654)
3,276)
)
625)
1,463)
6,912)
255)
415)
19,600)
(
(
544)
14,077)
(
(
153)
19,447)
(
(
(
(
153)
395)
4)
544)
(
(
(
(
153)
)
)
153)
The receivable from Peru Land & Farming in 2007 related to the consideration for issuance of shares in
Camposol AS.
The drawback recovered during the year 2008 was USD 4,019,000 (USD4,017,000 in 2007)
Receivables from employees do not carry interest and are unsecured.
37
2007
USD 000
(
(
(
27,627)
10)
27,637)
(
(
(
42,133)
1,361)
43,494)
(
(
1,815)
25,822)
(
(
125)
43,369)
(((
((
125))
3,040))
21
1,315
14
1,815)
((
((
(
(
((((
31))
113))
19
-)
)
125))
Trade accounts receivable mainly correspond to invoices for the sale of fresh, preserved and frozen
products. The credit period ranges between 90 and 180 days and do not accrue interest. Sales are usually
made on the basis of export letters of credit.
As of 31 December 2008, the aging analysis of trade receivables is as follows:
Total
USD 000
25,822
Current
USD 000
18,805
31-90
days
USD 000
405
91-180
days
USD 000
181-360
days
USD 000
5
6,592,
More than
361 days
USD 000
15
The time band Between 181 360 days includes mainly accounts receivable from one customer of USD
6,301 thousand, out of which USD 1,800 thousand was recovered during the first quarter of 2009.
As of 31 December 2008 and 2007 over 65% of accounts receivable are pledged as security for the
Credit Suisse loan (Note 24)
The fair value of accounts receivable aproximates their carrying amounts due to their short-term
maturities.
20 CASH AND SHORT-TERM DEPOSITS
Cash
Bank current accounts
2008
USD 000
2007
USD 000
42
5,728
5,770
35
89,731
89,766
The Group has bank current accounts mainly in United States dollars, Euros and Peruvian nuevos soles.
These funds are freely available and bear market floating interest rates.
38
Authorised
40.000.000 ordinary shares of 0,01 each
4.000.000
USD000
29.833.820
2.570.000
32.403.820
507
The initial shares are non-voting and do not participate in dividend distributions.
In April 2008, the Company issued 27 925 070 shares to the shareholders of Camposol AS (Norway) in
exchange for an equal number of shares in that company.
In May 2008, the Company issued 1 908 750 new ordinary shares at a price of USD 7,859 per share.
Warrants to shareholders
Dyer Coriat Holding S.L were granted by Camposol AS 3.628.344 warrants to acquire shares in that
company. These were replaced by warrants to acquire shares in Camposol Holding PLC as follows:
Class A
Class B
Class C
Number of
warrants
1,375,000
1,195,652
1,057,692
Exercise price
NOK 40
NOK 46
NOK 52
Exercise period
8 April 2008 - 8 Oct.2008
8 Oct. 2008 - 8 Oct. 2009
8 Oct. 2009 - 8 Oct. 2010
The warrants represent a type of finder's fee to Dyer Coriat Holding S.L for identifying the acquisition of
Camposol SA. and is included in the cost of the combination.
The fair value of the warrants at the grant date was estimated using the Black and Scholes-Merton pricing
model (using inputs for the share issue price, the exercise price, option life, volatility and risk free interest
rate) at USD 6,133,000.
The Class A warrants with a fair value at grant date of USD2,019,000 expired without being exercised
and were reclassified to retained earnings within equity.
Share options
In 2008 the Company has granted 300 000 share options to Directors and 585 000 options to
management. The fair value of the options was estimated at the grant date by an external expert using the
Black and Scholes Merton option pricing formula, at USD 561.000.
The exercise price of the options to Directors and management has been fixed at NOK 40 and can be
exercised in each of the years 2009 to 2012.
Also, the Company has granted 150 000 share options to a former manager, valued at USD257.000.
The exercise price of these options ranges from NOK 40 to 52 and 1/3 can be exercised in each of the
years 2008 to 2010. Options for 50 000 shares, with a fair value at grant date of USD 73.000 expired
without being exercised and were reclassified to retained earnings within equity.
39
Shares
8,571,000
28.73%
4,350,018
14.58%
3,380,100
11.33%
2,559,000
8.58%
1,908,750
6.40%
6 South Winds AS
1,753,000
5.88%
1,195,950
4.01%
1,116,500
3.74%
750,000
2.51%
657,000
2.20%
11 Storebrand Livsforsikring AS
434,800
1.46%
404,000
1.35%
393,482
1.32%
201,500
0.68%
193,900
0.65%
165,000
0.55%
157,000
0.53%
18 MP Pensjon
9 Orkla ASA
137,000
0.46%
91,300
0.31%
77,043
0.26%
1,337,477
4.47%
29,833,820
100.00%
Others
Total
(
(
(
(
(
40
12,262)
118)
1,958)
92)
10,094)
2007
USD 000
(
(
(
(
(
10,768)
1,494)
)
)
12,262)
Opening
balance
USD 000
(
(
(
(
(
)
)
135)
292)
427)
Equity
USD 000
Adjusments
USD 000
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
)
)
)
)
)
(
(
(
(
(
2,308)
1,958)
44)
636)
4,946)
2,308)
)
91)
344)
2,561)
6,289) (
4,815) (
2,409) (
196) (
) (
) (
49) (
) (
8,747)
4,619
1,260) (
150) (
) (
) (
1,110)
(
(
(
(
(
219)
)
106)
12,689)
12,262)
Opening
balance
USD 000
Deferred liability
Valuation of biological assets
Fair value of fixed assets at acquisition
of subsidiary
Fair value of customer relationships
at acquistion of subsidiary
Depreciation rates
Other
)
1,958)
)
)
1,958)
(
(
(
(
(
(
(
47)
165)
262)
2,443)
118)
2007 -
Balance as of
December 31,
2008
USD 000
Income
statement
USD 000
(
(
(
(
(
)
)
)
)
1,958)
Balance as of
December 31,
2007
USD 000
Income
statement
USD 000
(
(
(
104) (
228) (
332) (
31) (
64) (
95) (
135)
292)
427)
(
(
4,677) (
4,856) (
1,612) (
41) (
6,289)
4,815)
1,291) (
31) (
1,260)
(
(
(
(
170)
106)
11,100)
10,768)
(
(
(
(
49)
)
1,589)
1,494)
41
(
(
(
(
219)
106)
12,689)
12,262)
(
(
(
(
(
)
)
141)
92)
92)
(
(
(
(
(
172)
165)
227)
15,040)
10,094)
Balance as of
December 31,
2007
USD 000
Income
statement
USD 000
Equity
USD000
Adjusments
USD 000
(
(
(
(
(
)
)
100)
436)
536)
(
(
(
(
(
1,494)
)
67)
23)
1,450)
(
(
(
(
(
)
1,450)
)
)
1,450)
(
(
(
(
(
)
)
)
)
)
(
(
(
(
(
1,494)
1,450)
33)
459)
3,436)
(
(
(
(
(
(
(
(
4,569)
3,474)
909)
163)
)
75)
9,190)
8,654)
(
(
(
(
(
(
(
(
1,785)
145)
111)
36)
123)
368)
1,248)
202)
(
(
(
(
(
(
(
(
)
)
)
)
)
)
)
1,450)
(
(
(
(
(
(
(
(
127)
93)
24)
)
)
257)
501)
501)
(
(
(
(
(
(
(
(
6,481)
3,422)
822)
127)
123)
36)
10,939)
7,503)
2007
Opening
balance
USD 000
Deferred assets Loss on investments in associates
Provisions
Deferred liability
Valuation of biological assets
Fixed assets fair value at acquisition
Customer relationships fair value
Depreciation rates
Other
(
(
(
(
(
(
(
(
(
(
Income
statement
USD 000
77) (
) (
77) (
3,375)
3,504)
932)
172)
27)
8,010)
7,933)
Balance as of
December 31,
2007
USD 000
23) (
436) (
459) (
(
(
(
(
(
(
(
1,194)
30)
23)
9)
48)
1,180)
721)
Balance as of
December 31,
2008
USD 000
(
(
(
(
(
(
(
100)
436)
536)
4,569)
3,474)
909)
163)
75)
9,190)
8,654)
The workers profit sharing liability, included in other payables (Note 26) on the balance sheet, has been
determined pursuant to applicable legal provisions.
42
24 LONG-TERM DEBT
Collateral
Carried forward:
43
lease
2008
USD000
2007
USD000
55,767
63,383
63,465
148
212
115
176
14
69
22
12
6
2
9
6
97
119
15
25
40
19
56,201
29
127,563
Guarantee
Brought forward:
Banco Interbank for purchase of water equipment
and
and
Carried forward:
44
2008
2007
56,201
127,563
89
143
267
146
579
778
484
392
978
400
595
861
204
295
26
27
102
148
266
85
152
169
150
216
15
17
2,387
1,260
2,087
64,582
132,500
Guarantee
Brought forward:
BIF for purchase of a Power Generator Cummins
2008
2007
64,582
132,500
114
160
115
144
24
33
73
74
34
50
14
57
56
1,346
66,354
1,105
134,136
(9,528)
56,826
(68,613)
65,523
45
2007
USD 000
17,140
17,306
22,316
64
56,826
7,143
20,505
15,694
22,181
65,523
1 year
2 years
3 years
More than 3 years
Fair values
The carrying amounts of both the short-term long-term borrowings approximate their fair value as the
interest rates of the loans are similar to market interest rates.
Finance leases
The future minimum lease payments under finance leases together with the present value of net minimum
lease payments are as follows:
USD 000
Within one year
After one year but not more than five years
Total minimum lease payments
Less amounts representing finance charges
Present value of minimum lease payments
(
(
(
(
(
Minimum
payments
2008
Present value
of payments
Minimum
payments
USD 000
USD 000
USD 000
4,655) (
7,157) (
11,812) (
1,225)
10,587)
4,317)
6,270)
10,587)
(
(
(
(
(
2007
Present value
of payments
6,094) (
2,328) (
8,422) (
1,134)
7,288)
5,148)
2,140)
7,288)
46
EBITDA to Interest Expense Ratio - As of the end of each fiscal quarter, the EBITDA to Interest
Expense Ratio shall be at least: (a) for each fiscal quarter in fiscal year 2007, 3.50:lx, (b) for the first
and second fiscal quarters in fiscal year 2008, 4.00: Ix, (c) for the third and fourth fiscal quarters in
fiscal year 2008 and for the first three fiscal quarters of fiscal year 2009, 1.40:lx, (d) for the fourth fiscal
quarter in fiscal year 2009, 2.75:lx and (e) for each fiscal quarter thereafter, 3.50.
The Total Debt to EBITDA Ratio shall not be greater than: (a) as of the end of each fiscal quarter in
fiscal year 2007, 3.50: Ix, (b) as of the end of the first quarter in fiscal year 2008, 3.25: Ix, (c) as of the
end of the second fiscal quarter in fiscal year 2008, 3.00: Ix, (d) as of the end of the third fiscal and
fourth fiscal quarters in fiscal year 2008, 6.25:lx; (e) as of the end of the first fiscal quarter in fiscal
year 2009, 6.35: Ix, (f) as of the end of the second and third fiscal quarters in fiscal year 2009, 6.00:
Ix, (g) as of the end of the fourth fiscal quarter in fiscal year 2009, 3.25:lx and (g) as of the end of each
fiscal quarter thereafter, 2.50:lx
The Tangible Net Worth of the Camposol SA and its consolidated subsidiaries shall not be less than:
(a) (i) $48,000,000, as of December 31, 2007, to the extent that the Cash Contribution constitutes
shareholders' equity on the books and records of the Borrower as of such date in accordance with
Peruvian GAAP or (ii) $33,000,00, as of December 31, 2007, to the extent that the Cash Contribution
constitutes a liability on the books and records of the Borrower as of such date in accordance with
Peruvian GAAP, (b) $112,000,000, as of March 31, 2008 and as of the end of each fiscal quarter
thereafter until the Amendment No. 2 Effective Date and (c) $100,000,000, as of the Amendment No.
2 Effective Date and as of the end of each fiscal quarter thereafter."
the Borrower is required to sell (or cause to be sold) not less than 65 per cent of the consolidated
aggregate export sales of all Products sold during each Coverage Period to Eligible Offtakers
pursuant to Sales Agreements governed by the laws of a country that is a member of the Organisation
for Economic Co-operation and Development.
the Borrower is required to sell (or cause to be sold) less than 35 per cent of the consolidated
aggregate export sales of all Products sold during each Coverage Period to Eligible Offtakers that are
not Affiliates of any Obligor pursuant to Sales Agreements governed by the laws of a country that is a
member of the Organisation for Economic Co- operation and Development.
During the period 2008 and 2007, Camposol SA has complied with all covenants and other agreements
contained in the Credit Agreement with Credit Suisse.
25 TRADE PAYABLES
2008
USD 000
Suppliers
Bills of exchange payable
(
(
(
12,232)
12,894)
25,126)
2007
USD 000
(
(
(
13,940)
5,036)
18,976)
Payables to suppliers are mainly in US dollars, are due within 12 months and do not carry interest.
Bills of exchange represent payables to suppliers mainly in foreign currency which are due within 12
months and carry interest at an average annual rate of 12%.
The average payment terms of trade payables are between 30 to 60 days.
47
26 OTHER PAYABLES
Noncurrent:
Derivative financial instrument (Note 32)
Deferred Workers profit sharing (Note 23)
Agreement with Peru Land & Farming (Note 18)
Current:
Derivative financial instrument (Note 32)
Vacation pay and other payables to employees
Taxes payable
Fair value of liability incurred to Peru Land &
Farming (Note 21)
Board remuneration
Loans from third parties
Others
2008
USD 000
2007
USD 000
12,204
7,503
19,707
937
8,654
6,912
16,503
3,908
2,762
1,238
4,532
791
2,230
310
420
8,283
305
228
1,197
9,638
2007
USD 000
3,447
10
969
6
469
Associates
Mission Asparagus LLC
Sales of finished products
Empacadora de Frutos Tropicales S.A.C.
Sales of finished products
Purchase of services
Enties related to Directors
Apoyo Consultora S.A.C.
Purchase of services
32
60
132
368
48
177
2007
USD000
1,360
1
1,361
10
10
146
8
36
182
8
Other payables
D.C. Holding S.L.
Other payables
Copeinca
415
230
Guarantees
In 2001 Camposol S.A. guaranteed a debt contracted by its related entity SP of Delaware Inc. with
Raytheon Aircraft Credit Corporation for the acquisition of an aircraft. As of December 31, 2007 the
outstanding debt amount guaranteed by Camposol S.A. was USD2,178,000, which is being paid in
quarterly installments until year 2013. As of March 31, 2009, Camposol is no longer a guarantor since the
debt was fully paid by SP Delaware Inc.
Compensation of key management personnel of the Group
Salaries of key managers
2008
USD 000
1,881
2007
USD 000
49
243
78
2008
USD 000
2007
USD 000
4,576
11,500
16,076
1,181
230
Loans :
Banco Interbank
Banco Scotiabank
Commercebank
BBVA Banco Continental
Banco de la Nacin
Overdrafts:
Banco Scotiabank
Banco Interbank
373
7
380
16,456
56
11
1,478
1,478
Loans represent promissory notes with maturities up to 180 days, obtained for working capital, with annual
interest rates between 2.50 per cent and 8.35 per cent (6.30 per cent and 7.19 per cent in 2007).
The overdrafts are in Peruvian Nuevos soles (PEN).
49
2008
USD 000
2007
USD 000
(
(
(
(
(
(
(
(
(
(
(
(
(
985)
5,110)
1,208)
3,435)
17,076)
362)
56)
1,416)
561)
79)
381)
1,611)
1,315)
431)
(
(
(
(
(
(
(
(
(
11,037)
885)
231)
113)
11,944)
379)
349)
94)
257)
741)
2,721
937)
- )
(
(
(
(
(
(
(
15,822)
3,512)
31,334)
1,187)
7,613)
10,429 )
20,703)
(
(
(
(
(
(
(
13,356)
8,128)
19,275)
2,320)
2,741)
4,387)
33,087)
(
(
1,268)
2,230)
(
(
6,802)
)
50
31 CONTINGENCIES
a) Labour proceedings
At December 31, 2008, the Group has several contingencies related to industrial operations
amounting to USD 1,289,000. Based on legal advice the potential loss is not significant.
A provision has been recognised for other labour claims for USD 611,000.
b) Tax exposures
Tax authorities may seek to adjust the income tax calculated by the Group companies.
The following table shows the income tax and value added tax returns subject to review by the Tax
Administration corresponding to Camposol and related companies
Years open to tax review
Company
Income Tax
Value AddedTax
2007 - 2008
2004 - 2008
2004 - 2008
2004 - 2007
2004 - 2008
2004 - 2008
2004 - 2008
2007 - 2008
2006 - 2008
2006 - 2008
2006 - 2008
2007 - 2008
2007 - 2008
2007 - 2008
2008
2008
2007 2008
2007 - 2008
Oct 2004- Dec 2008
Dec 2004-Dec 2008
Dec 2004-Nov 2007
Oct 2004- Dec 2008
Oct 2004- Dec 2008
Oct 2004- Dec 2008
Apr 2007 - Dec 2008
Aug 2006 Dec 2008
Dec 2006 Dec 2008
Aug 2006 Dec 2008
2007- 2008
2007- 2008
2007 - 2008
2008
2008
2007 - 2008
32 RISK MANAGEMENT
The Group is exposed to market and operational risks connected with its agricultural activities and
financial risks, including the effect of variations in foreign currency exchange rates, interest rates and
liquidity.
The Groups senior management and the Board of directors oversee the management of these risks and
implement a risk management program aiming at reducing to a minimum any potential adverse effect on
the Groups financial performance.
Market and operational Risks
Almost all of the Groups products are sold in the international market. A further economic slowdown in the
key markets may cause lower sales volumes and prices, and losses on trade receivables.
The financial position and future development of the Group will depend significantly on the sales prices of
its fruit and vegetables produce. The Group produces fresh, frozen and preserved products. Fresh
products tend to be more profitable, followed by frozen products and finally preserved goods. However the
complexity of production and the distribution logistics are greater in the case of fresh and frozen products
compared to preserved goods. In this way there is an inversely proportional relationship between
profitability and commercial complexity of the product type.
51
000
(
(
(
1,170) (
38,513) (
39,683) (
(
(
(
(
864)
30,985)
31,849)
7,834)
(
(
(
(
2007
PEN 000
000
56)
2,843)
2,899)
1,846)
8,569)
10,415)
(
(
(
2,147) (
20,193) (
22,340) (
74)
1,912)
1,986)
8,429)
(
(
(
(
15)
8,310)
8,325)
14,015)
(
(
(
(
2)
)
2)
2,897)
The following table demonstrates the sensitivity to a reasonably possible change in the Peruvian nuevos
soles exchange rate and Euro exchange rate for twelve months, with all other variables held constant, on
the Groups profit before tax:
Increase/
decrease in
PEN rate
Effect on
profit
before tax
USD 000
2008
+4%
-4%
(96)
104)
+4%
-4%
(464)
(465)
2007
+4%
-4%
(180)
(195)
+4%
-4%
(164)
(164)
52
Increase/
Effect on
decrease in
profit
rate
before tax
USD 000
Fair value
USD 000
(937)
5,809)
(612)
(7,823)
(16,112)
(937)
6,746)
(6,421)
(7,211)
(8,289)
Effectiveness
ratio - %
(retrospective)
100.8
93.2
110.9
106.9
(*)
11,093
3,908
12,204
1,611
3,408
USD 937,000 for 2007 and USD 674,000 in 2008 (Note 10).
The line of credit with Credit Suisse covers hedge exposure up to USD 15 million, and any excess is
covered by a cash collateral.
The following table demonstrates the sensitivity to a reasonably possible change in the Peruvian nuevos
soles exchange rate with all other variables held constant on the valuation of the cash flow hedge as of 31
December 2008.
Increase/
decrease in
PEN rate
2008
+4%
-4%
53
Effect on
Valuation
Hedge
USD 000
1,505
(1,505)
Between 1
and 2 years
USD 000
16,456
12,894
9,528
2007
Financial assets at fair value
Bank loans
Bills of exchange payable
Long - term debt
109
1,478
5,036
68,278
Between 2
and 5 years
USD 000
Over 5
years
USD 000
Total
USD 000
17,140
39,686
16,456
12,894
66,354
6,590
50,711
109
1,478
5,036
134,136
8,557
Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or
custoner contract leading to a financial loss. The Group is exposed to credit risk on trade and other
receivables and deposits with banks.
The Group places its excess funds with top ranked financial institutions.
The maximum exposure to credit risk is the carrying amount of accounts receivable as shown on the
balance sheet. Sales transactions are carried out with a number of different counterparties, which
mitigates credit risk concentration.
The accounts receivable from a single customer represent 24 per cent of the balance as of December 31,
2008 (38 per cent as of December 31, 2007). However, all new transactions with this customer are being
executed with letters of credit to mitigate credit risk exposure.
In addition, the Group has a multimarket credit insurance coverage over the exports of fresh and
preserved products in an aggregate amount up to USD 42 million at December 31, 2008.(US$15 million
at December 31, 2007).
Liquidity risk
The liquidity risk caused by inability to obtain funds required to meet the Groups investment commitments
associated with financial instruments includes the Groups inability to sell a financial asset in a prompt
manner, at a price that approximates its fair value.
The Group has sufficient credit capacity to have access to credit lines with top ranked financial institutions
under reasonable terms. However, with the current world financial crisis there is risk that banks may revise
the terms of the lines of credit.
54
Within 1 year
USD 000
Between 2
and 5 years
USD 000
Total
USD 000
25,126
16,456
9,528
51,110
6,340
17,140
17,140
39,686
39,686
25,126
16,456
66,354
107,936
4,902
4,631
15,873
6,590
6,590
59,268
59,268
18,976
1,478
134,136
154,590
1,240
25,643
27,863
18,976
1,478
68,278
88,732
980
Management manages the risk associated with the amounts included in each of the buckets above
including the development of new bank relationships in order to have adequate funding available all the
time. At December 31, 2008 agreed funding totalled USD 24 million. The strategy of the Group is to
maintain the gearing ratio within acceptable industry standards.
Capital risk management
The Group objectives when managing capital are to safeguard the Groups ability to continue as a going
concern and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by
total capital plus net debt. Net debt is calculated as total borrowings plus trade and other payables, less
cash and cash equivalents. Total capital is calculated as equity as shown in the consolidated balance
sheet, less unrealised gains reserve.
As of December 31, 2008 and 2007, the Groups strategy was to maintain the gearing ratio in no more
than 1. The gearing ratios at December 31, 2008 and 2007 were as follows:
2007
USD 000
2008
USD 000
Bank loans
Long - term debt
Trade and other payables
Less available funds
Net debt
(
(
(
(
(
16,456)
66,354)
54,471)
5,770)
131,511)
(
(
(
(
(
1,478)
134,136)
43,739)
89,766)
89,587)
(
(
(
208,683)
12,453)
221,136)
(
(
(
196,302)
11,037)
207,339)
352,647)
296,926)
Gearing ratio
0.37)
0.30)
55