Aeolos S.A. Audited annual accounts for the year ended March 31, (with the report of the Réviseur d Entreprises agréé thereon)

Transcription

1 Aeolos S.A. Audited annual accounts for the year ended March 31, 2016 (with the report of the Réviseur d Entreprises agréé thereon) , route d Arlon, L-1150 Luxembourg R.C.S Luxembourg B

2 TABLE OF CONTENTS Page(s) - Report of the Réviseur d Entreprises agréé Directors report Balance sheet Profit and loss account Notes to the accounts 15-18

3 Directors Report Dear Shareholders, The Board of Directors is pleased to present the annual accounts of Aeolos S.A. (the Company ) for the year ended March 31, Activities and Review of the development of the business The Company was incorporated on November 26, 2001 under the Luxembourg Law with the application of the Companies Act The Company has been established for the purpose of receivables securitisation (within the meaning of the law of 1915). The Company has purchased the receivables arising from the European Organisation for the Safety and Air Navigation (Eurocontrol). The principal risk to the Company is the reliance on a sole counterparty (a European Union Government). The Company s main asset is a receivable from the Greek government. The Greek government has also committed to pay the principal and interest on the notes in the event of a shortfall in the available funds of the Company. Since 2009, the Greek government has been experiencing a debt crisis leading to significant speculation over the future of the Greek economy with political uncertainty and instability. Efforts to implement austerity measures put forward as part of the bailout conditions continue to be met with public protests which could in turn discourage would-be travelers to Greece and ultimately impact cash flows from the Purchased Receivables. Even if the tourism in Greece still continued to perform well in 2015 and previsions are very optimistic for 2016, matters described in Note 2, still indicate the existence of a material uncertainty which may cast significant doubt on the Company s ability to continue as a going concern. As at March 31, 2016, the total amount of receivables held in portfolio was of EUR 85,781,210. During the financial year ended March 31, 2016, a total amount of EUR 25,726,685 was received on the receivables. For the financial year ending March 31, 2016, the continuance of the existing programme is foreseen without any significant change. March 31, 2016 March 31, 2015 EUR EUR Total assets 98, ,871,818 Notes issued and outstanding 86,509, ,478,446 Net profit/(loss) for the financial year NIL NIL 3

4 Directors Report Acquisition of own shares During the financial year ended March 31, 2016, the Company has not purchased any of its own shares. Research and development activities The Company was not involved in any kind of research or development activities during the year ended March 31, Branches of the Company The Company does not have any branches. Corporate Governance Declaration The Company has issued securities quoted on the Luxembourg Stock Exchange and thus included a declaration on corporate governance, as defined by art.4 paragraph (1) point 14 of the Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments. Risk Management and Internal Control The Board of Directors has overall responsibility for the Company s system of internal control and risk management, incident to the day-to-day control of the Company s business, the internal control and the preparation of the annual accounts. The Board of Directors of the Company is aware of the compliance with laws and regulations. The Company has no own employees. Corporate and domiciliation services are provided by Structured Finance Management (Luxembourg) S.A. ( SFM ), a regulated service provider, which is supervised by the CSSF. For services provided by SFM the four eyes principle is established. The system of internal control is designed to manage the risk of failure to achieve business objectives and can only provide reasonable and not absolute assurance against material misstatement or loss. SFM is using a database where critical dates such as reporting to the CSSF, Stock Exchanges or other institutions are monitored by the management of the Company on a monthly basis. The Company is dependent on the information provided by the arranger on which SFM provides due diligence and has the necessary procedures, checks and balances. The arranger is fully responsible for the quality of information regarding the valuation of assets of each Compartment provided to SFM and to the Company. All capital expenditure, other purchases and expenses are subject to appropriate authorisation procedures. 4

5 Statement directors' financial a the event No Greece. events have to 31, 2016 in Director 5

6 KPMG Luxembourg. Societe cooperative 39. Avenue John F. Kennedy L 1855 Luxembourg Tel.: Fax: nfo@kpmg.lu Internet: To the Shareholders of Aeolos S.A route d"arlon, L Luxembourg REPORT OF THE REVISEUR D'ENTREPRISES AGREE Report 011 t/je / acc01111ts We have audited the accompany ing annual accounts of Aeolos S.A., which comprise the balance sheet as at March and the profit and loss accou nt for the year then ended. and a summary of significant accounting policies and other explanator)' information. Board of Directors respo11.'iihility for the w11mal accmmts The Board of Directors is responsible for the preparation and fair presentation of these annual accounts in accordance with Luxembourg legal and rcgulatoi)' requirements relating to the preparation of the annual accounts. and for such interna l control as the 13oard of D irectors determines is necessary to enable the preparation of' annua l accounts that arc free from material misstatement. whether due to fraud or error. Respo11sibi!izv of the Reviseur d'e11treprises agree Our responsibility is to express an opinion on these annual accounts based on our audit. We conducted our audit in accordance with International Standards on Auditing as adopted for Luxembourg by the Commission de Survei llance du Sccteur financier. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the annual accounts arc free from material misstatement. A n audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the annual accounts. T he procedures selected depend on the judgement of the Reviseur d' Entreprises agree. including the assessment of the risks of material misstatement of the an nual accounts. whether due to fraud or error. In making those risk assessments. the Reviseur d Entreprises agree considers internal control relevant to the entity s preparation and fair presentation of the annual accounts in order to design audit procedures that arc appropriate in the circumstances. but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board of Directors, as well as eva luating the overall presentation of the annual accounts. We bel ieve that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opi11io11 In our opinion. the annual accounts give a true and fair v iew of the financial position of Aeolos S.A. as of March and of the results of its operations for the year then ended in accordance with Luxembourg legal and regulatory requirements relating to the preparation of the annual accounts. KPMG lu errboorg Sooilt6 coooeral ' a lu"'l1'boorg enhlyaod a lva LU member I.rm ol tt>e KPMG r>eh,1>'< ot noepend.lnt IN!mbef l rms RCS lu, cmdourg B ett.a1ed w<th KPll G 1n101na1.ona1 COOl)erat vo l"kpmg ln:ema:oonan. a s." 1ss en:rty

7 Emplwsis of matter Without qua li fying our op1n1on, we draw attention to Note 2 to the an nual accounts. The Company's main asset is a receivable from the Greek government. The Greek government has also com mitted to pay the principal and interest on the notes issued by the Company in the event of a shortfa ll in the avai lable fu nds of the Company. Since the Greek government has been experiencing a debt crisis leading to significant speculation over the future of the Greek economy with political uncertainty and instability. Along wit h other matters described in ote 2. a material uncertainty which may cast significant doubts on the Company's abil ity to conti nue as a going concern still exists. Report 011 other legal mu/ regulatory requirements The management report. which is the responsibil ity of the Board of Di rectors. is consistent with the annual accounts. Luxembourg, July 26, 2016 KPMG Luxembourg. Socictc cooperative Cabinet de revision agree / F. Rouault

8 Annual Accounts Helpdesk : Tel. : (+352) centralebilans@statec.etat.lu FTKWDGP T _001 RCSL Nr. : B84686 Matricule : BALANCE SHEET ecdf entry date : Page 1/6 Financial year from 01 01/04/2015 to 02 31/03/2016 (in 03 EUR ) Aeolos S.A , Route d'arlon L-1150 Luxembourg ASSETS Reference(s) Current year Previous year A. Subscribed capital unpaid I. Subscribed capital not called II. Subscribed capital called but unpaid B. Formation expenses , ,00 C. Fixed assets , ,00 I. Intangible fixed assets Research and development costs Concessions, patents, licences, trade marks and similar rights and assets, if they were a) acquired for valuable consideration and need not be shown under C.I b) created by the undertaking itself Goodwill, to the extent that it was acquired for valuable consideration Payments on account and intangible fixed assets under development II. Tangible fixed assets Land and buildings Plant and machinery The notes in the annex form an integral part of the annual accounts 6

9 FTKWDGP T _001 RCSL Nr. : B84686 Matricule : Page 2/6 Reference(s) Current year Previous year 3. Other fixtures and fittings, tools and equipment Payments on account and tangible fixed assets under development III. Financial fixed assets , ,00 1. Shares in affiliated undertakings Amounts owed by affiliated undertakings Shares in undertakings with which the undertaking is linked by virtue of participating interests Amounts owed by undertakings with which the undertaking is linked by virtue of participating interests Securities and other financial instruments held as fixed assets Loans and claims held as fixed assets , , ,00 7. Own shares or own corporate units D. Current assets , ,00 I. Inventories Raw materials and consumables Work and contracts in progress Finished goods and merchandise Payments on account II. Debtors , ,00 1. Trade receivables within one year after more than one year Amounts owed by affiliated undertakings within one year after more than one year Amounts owed by undertakings with which the undertaking is linked by virtue of participating interests within one year after more than one year The notes in the annex form an integral part of the annual accounts 7

10 FTKWDGP T _001 RCSL Nr. : B84686 Matricule : Page 3/6 III. IV. Reference(s) Current year Previous year 4. Other receivables , ,00 within one year , ,00 after more than one year Transferable securities and other financial instruments Shares in affiliated undertakings and in undertakings with which the undertaking is linked by virtue of participating interests Own shares or own corporate units Other transferable securities and other financial instruments Cash at bank, cash in postal cheque accounts, cheques and cash in hand , ,00 E. Prepayments , ,00 TOTAL (ASSETS) , ,00 The notes in the annex form an integral part of the annual accounts 8

11 FTKWDGP T _001 RCSL Nr. : B84686 Matricule : Page 4/6 LIABILITIES Reference(s) Current year Previous year A. Capital and reserves , ,00 I. Subscribed capital , ,00 II. Share premium and similar premiums III. Revaluation reserves IV. Reserves Legal reserve Reserve for own shares or own corporate units Reserves provided for by the articles of association Other reserves V. Profit or loss brought forward VI. Profit or loss for the financial year VII. Interim dividends VIII. Capital investment subsidies IX. Temporarily not taxable capital gains B. Subordinated debts Convertible loans within one year after more than one year Non convertible loans within one year after more than one year C. Provisions , ,00 1. Provisions for pensions and similar obligations Provisions for taxation , ,00 3. Other provisions D. Non subordinated debts , ,00 1. Debenture loans , ,00 a) Convertible loans i) becoming due and payable within one year ii) becoming due and payable after more than one year The notes in the annex form an integral part of the annual accounts 9

12 FTKWDGP T _001 RCSL Nr. : B84686 Matricule : Page 5/6 Reference(s) Current year Previous year b) Non convertible loans , ,00 i) becoming due and payable within one year , ,00 ii) becoming due and payable after more than one year , ,00 2. Amounts owed to credit institutions within one year after more than one year Payments received on account of orders as far as they are not deducted distinctly from inventories within one year after more than one year Trade creditors , ,00 within one year , ,00 after more than one year Bills of exchange payable within one year after more than one year Amounts owed to affiliated undertakings within one year after more than one year Amounts owed to undertakings with which the undertaking is linked by virtue of participating interests within one year after more than one year Tax and social security debts a) Tax debts b) Social security debts The notes in the annex form an integral part of the annual accounts 10

13 FTKWDGP T _001 RCSL Nr. : B84686 Matricule : Page 6/6 Reference(s) Current year Previous year 9. Other creditors , ,00 within one year , ,00 after more than one year , ,00 E. Deferred income TOTAL (LIABILITIES) , ,00 The notes in the annex form an integral part of the annual accounts 11

14 Annual Accounts Helpdesk : Tel. : (+352) centralebilans@statec.etat.lu FTKWDGP T _001 RCSL Nr. : B84686 Matricule : PROFIT AND LOSS ACCOUNT ecdf entry date : Page 1/3 Financial year from 01 01/04/2015 to 02 31/03/2016 (in 03 EUR ) Aeolos S.A , Route d'arlon L-1150 Luxembourg A. CHARGES Reference(s) Current year Previous year 1. Use of merchandise, raw materials and consumable materials Other external charges , ,00 3. Staff costs a) Salaries and wages b) Social security on salaries and wages c) Supplementary pension costs d) Other social costs Value adjustments , ,00 a) on formation expenses and on tangible and intangible fixed assets , ,00 b) on current assets Other operating charges Value adjustments and fair value adjustments on financial fixed assets Value adjustments and fair value adjustments on financial current assets. Loss on disposal of transferable securities Interest and other financial charges , ,00 a) concerning affiliated undertakings b) other interest and similar financial charges , , ,00 The notes in the annex form an integral part of the annual accounts 12

15 FTKWDGP T _001 RCSL Nr. : B84686 Matricule : Page 2/3 Reference(s) Current year Previous year 9. Share of losses of undertakings accounted for under the equity method Extraordinary charges Income tax , , Other taxes not included in the previous caption , , Profit for the financial year , ,00 TOTAL CHARGES , ,00 The notes in the annex form an integral part of the annual accounts 13

16 FTKWDGP T _001 RCSL Nr. : B84686 Matricule : Page 3/3 B. INCOME Reference(s) Current year Previous year 1. Net turnover Change in inventories of finished goods and of work and contracts in progress Fixed assets under development Reversal of value adjustments a) on formation expenses and on tangible and intangible fixed assets b) on current assets Other operating income Income from financial fixed assets a) derived from affiliated undertakings b) other income from participating interests Income from financial current assets a) derived from affiliated undertakings b) other income from financial current assets Other interest and other financial income , ,00 a) derived from affiliated undertakings b) other interest and similar financial income , ,00 9. Share of profits of undertakings accounted for under the equity method Extraordinary income Loss for the financial year , ,00 TOTAL INCOME , ,00 The notes in the annex form an integral part of the annual accounts 14

17 Aeolos S.A. NOTES TO THE ANNUAL ACCOUNTS for the year ended March 31, General information Aeolos S.A. (the Company ) is a Luxembourg limited liability company ( Société Anonyme ) incorporated on November 26, The Company is established for an unlimited period of time. With effect from February 29, 2016, the registered office of the Company was moved to , Route d Arlon, L-1150 Luxembourg and the Company has been registered in the Luxembourg Register of Commerce under the section B, number B The financial year of the Company begins on April 1 and ends on March 31. The corporate object of the Company is the holding of participations directly or indirectly, in any form whatsoever, in Luxembourg and foreign companies, the acquisition by purchase, subscription, or in any other manner, securitisation or repackaging, as well as the transfer by sale, exchange or otherwise, of stock bonds, debentures, notes and other securities of any kind, and the ownership, administration, development and management of its portfolio. The Company may also hold interests in partnerships. As the Company does not have any participation, it does not prepare consolidated annual accounts. 2 Going concern As disclosed in note 5, the Hellenic Republic sold and transferred to the Company against payment of the purchase price, all of the Hellenic Republics rights to the Eurocontrol Receivables other than the Excluded Receivables, as per terms of the Receivables Purchase Agreement. Since 2009, the Greek government has been experiencing a debt crisis leading to significant speculation over the future of the Greek economy. The Greek government has negotiated financing through a financial package provided by the European Union ( EU ) and the International Monetary Fund ( IMF ). The Greek government remains under pressure to speed up reforms in order to meet the targets set out in the financial package. The international lenders have continued to insist that Greece must meet its reform pledges if it is to receive further funding. Efforts to implement austerity measures put forward as part of the bailout conditions continue to be met with public protests which has resulted in further financial instability. The Greek government has indicated that it will honour the Receivables Purchase Agreement. The Company has continued to receive cash flows from the Purchased receivables as scheduled. However, the continued financial, economic and political instability in Greece together with the public protests could discourage would-be travellers (especially tourists) to Greece which would in turn impact the flow of air traffic to that country. The Purchased receivables derive cash flows from air traffic fees. As long as such an eventuality has not arisen, the receivables continue to perform. Despite the migrant crisis, tourism in Greece continued to perform well in 2015 and previsions are very optimistic for 2016 due to new visitors from Russia and tourists who decide to change destination from Turkey, Egypt or Tunisia to Greece for safety reasons. Nevertheless, the risk and possibility of reduction in the number of tourists remains hence the material uncertainty which could have an indirect or direct impact on the Company as the amounts and timing of receipts from the Purchased Receivables are uncertain and there can be no assurance such receipts would continue to be sufficient to enable the Company to meet its liabilities. In the event of such a shortfall and failure by the Hellenic Republic to fulfil its undertaking to pay the shortfall amount, the Company could default on the repayment of the notes. This condition, along with other matters described here, indicate the existence of a material uncertainty which may cast significant doubt on the Company s ability to continue as a going concern. 15

18 Aeolos S.A. NOTES TO THE ANNUAL ACCOUNTS for the year ended March 31, 2016 (continued) 3 Significant Accounting Policies 3.1 Basis of presentation The annual accounts are prepared in accordance with legal requirements and generally accepted accounting principles in the Grand Duchy of Luxembourg. The Company adopted the Balance Sheet and Profit and Loss account format in accordance with the filing requirements of the Registre de Commerce et des Sociétés ( RCSL ) and the Law of July 30, 2013 reforming the Commission des Normes Comptables ("CNC") (the CNC Law ) for the year ended March 31, Financial fixed assets The Company s financial assets are stated at acquisition cost less any permanent diminution in the value. 3.3 Foreign currency translation The Company maintains its accounts in EUR and the annual accounts are expressed in this currency. Assets and liabilities expressed in a currency other than EUR are converted into EUR at the rate of exchange ruling at the balance sheet date. Income and charges in foreign currency are converted into EUR at the rate of exchange ruling on the date of the transaction. Realized exchange gains and losses and unrealized exchange losses are reflected in the profit and loss account. 3.4 Financial assets, income and performance fees Amounts received from the European Organisation for the Safety of Air Navigation (Eurocontrol) reduce the investment in the securitised receivables on the same basis as the repayment of the notes issued. Cash received and receivable in excess of the required payment level is accounted for as income. The performance fees represent the Deferred Purchase Price ( DPP ) and are calculated in accordance with the offering circular as an amount equal to the available funds less amounts necessary to service the notes and certain expenses. The fees are paid to the Hellenic Republic on each interest payment date, and are accounted for as an expense. The interest payment dates are set as March 31 and September 30 of each year. Eurocontrol is a regionally-oriented international organization, which aims to develop a European-wide air traffic management system, and is comprised of 40 member states, including the Hellenic Republic and the European Union. 16

19 Aeolos S.A. NOTES TO THE ANNUAL ACCOUNTS for the year ended March 31, 2016 (continued) 4 Formation expenses Formation expenses incurred with the issuance of the notes are amortized on a straight-line basis over the life on the notes. 5 Financial fixed assets The Hellenic Republic sold and transferred to Aeolos S.A. against payment of the purchase price all of the Hellenic Republic s rights to the Eurocontrol Receivables other than the Excluded Receivables. The Excluded Receivables is the aggregate of (a) one third (1/3) of the Eurocontrol Receivables and (b) an amount equal to the product of EUR 9 and the Service Units. (Service Units is a function of the distance of the flight and weight of the planes crossing the air space of the Hellenic Republic). The Eurocontrol Receivables are amounts receivable by the Hellenic Republic from Eurocontrol pursuant to the Route Charges Agreement. The aggregate purchase price for the rights to the existing and future rights is equal to the DPP (see Note 3.4) and the proceeds from the issuance of the non subordinated debts less expenses payable by the issuer in relation to the issuance and placement of the non subordinated debts and the execution of the transaction documents. 6 Subscribed capital The subscribed capital of EUR 125,000 issued and fully paid, and is represented by 125 registered shares of EUR 1,000 each. 7 Legal reserve Under Luxembourg law, the Company must appropriate at least 5% of its statutory net profit to a non distributable legal reserve until the aggregate reserve reaches 10% of the subscribed share capital. As the Company has no profit, no reserve has been established. 8 Non-subordinated debts The non-subordinated debts, amounting to EUR 355,000,000, were issued on December 13, 2001 at an issue price of 100% and are denominated in the form of EUR 1,000 each. The non-subordinated debts are direct, secured and limited recourse obligations of the issuer and payable solely out of the assets charged or pledged by the issuer to secure the non-subordinated debts. The non-subordinated debts are partially redeemed annually with final redemption on March 31, 2019, and carry interest at the six month EURIBOR plus 0.24% up to the Interest Payment date falling in March 2012, and carry interest at the six month EURIBOR plus 0.48% thereafter. 17

20 Aeolos S.A. NOTES TO THE ANNUAL ACCOUNTS for the year ended March 31, 2016 (continued) 9 Current tax The Company is subject to taxation in Luxembourg under specific provisions associated with its business activities. 10 Guarantee from the Hellenic Republic 11 Others The Hellenic Republic unconditionally and irrevocably undertook a commitment to pay an amount in Euro to enable payment of principal and interest on the notes in the case of a shortfall in the available funds of Aeolos S.A.. The Company did not make any advances and loans to members of the administrative, managerial and supervisory bodies during the year. The Company did not employ any personnel. 12 Fees billed by KPMG Luxembourg Société coopérative and other member firms of the KPMG network Fees billed (excluding VAT) to the Company by KPMG Luxembourg Société cooperative during the financial year are as follows (in EUR): Audit fees 9,137 8,915 9,137 8,915 Such fees are presented under other external charges in the profit or loss account. 18