CONTENTS I. ORGANIZATION OF THE IMPEL GROUP INCLUDING SPECIFICATION OF CONSOLIDATED UNDERTAKINGS... 3

Transcription

1 The Management Board of IMPEL S.A. releases the Consolidated Quarterly Report for the third quarter of 2017

2 CONTENTS I. ORGANIZATION OF THE IMPEL GROUP INCLUDING SPECIFICATION OF CONSOLIDATED UNDERTAKINGS... 3 II. CONDENSED QUARTERLY FINANCIAL STATEMENTS OF THE IMPEL GROUP CONDENSED QUARTERLY STATEMENT Of FINANCIAL POSITION OF THE IMPEL GROUP CONDENSED STATEMENT OF COMPREHENSIVE INCOME OF THE IMPEL GROUP CONDENSED STATEMENT OF CHANGES IN CONSOLIDATED EQUITY OF THE IMPEL GROUP CONSOLIDATED STATEMENT OF CASH FLOWS OF THE IMPEL GROUP SELECTED EXPLANATORY NOTES III. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS OF IMPEL S.A STATEMENT OF FINANCIAL POSITION OF IMPEL S.A STATEMENT OF COMPREHENSIVE INCOME OF IMPEL S.A STATEMENT OF CHANGES IN EQUITY OF IMPEL S.A STATEMENT OF CASH FLOWS OF IMPEL S.A SELECTED EXPLANATORY NOTES IV. SUPPLEMENTARY INFORMATION V. OTHER INFORMATION SIGNATURES OF THE PERSONS REPRESENTING IMPEL S.A

3 I. ORGANIZATION OF THE IMPEL GROUP INCLUDING SPECIFICATION OF CONSOLIDATED UNDERTAKINGS The Impel Group (the Group ) is Poland s largest group of companies that specializes in the provision of high quality outsourcing services to enterprises and institutions. The Group has numerous companies dedicated to support business and auxiliary processes. We have the best offer for almost all market segments. Modern technologies, knowhow, experience and the scale of operations enable the Group to offer considerable optimization of work organization, HR management processes, which ly translates into benefits for customers. The Parent undertaking Impel S.A. is the only sector company listed on WSE Impel S.A.; it supervises and forms corporate regulations. The Group is organized based on product: there are 3 business areas: Facility Management, Digital Services & Business Process Outsourcing and Industrial Services. Business areas are divided into 22 product groups. At the Group 3 service provision models are applied: Own provision of services, use of subcontractors, as well as supervision of service provision by franchisees. As at 30 September 2017 the Group comprises 73 economic entities. Despite the head offices the Group has 7 regional offices managing a network branches across the country. 7,200 customers is the Group s customer portfolio. The Group employs ly and inly (subcontracting) approx. 60 thousand persons. The mains operations of the Group are conducted in Poland, but it is also present in Latvia, Ukraine, Germany and Kazakhstan. As at 30 September 2017, Impel Group consists of Impel S.A. i.e. the Parent Undertaking and: 35 undertakings, 435 in undertakings. Consolidation with equity method also comprises 1 co undertaking and 1 associated undertaking. As at 30 September 2017, the composition of the Group, in a breakdown by Business Units, was as follows: No. Name of undertaking and legal form Registered office Business Profile Type of relation with Impel S.A. Shareholders Method of consolidation Parent Undertaking Impel S.A. Wrocław supervision and management of the Impel Group Parent Undertaking 38,78 % Nutit a.s 22,60% Trade Bridge Czechy a.s. 1% Józef Biegaj 37,62% other shareholders Subsidiary undertakings FM Segment (Facility Management) 1. Impel Cleaning Wrocław cleaning services 2. Company Wrocław outsourcing services 3. HR for Business Wrocław outsourcing services in 100% Impel S.A. 100% Impel S.A. 100% Impel Cleaning 3

4 Hospital Service Company S.K. Impel Food Hygiene Company S.K. 1 DC System Company S.K. 2 Wrocław Warsaw Warsaw assistance services in healthcare specialized cleaning services for production plants in the food industry cleaning services (cleaning facilities, including office buildings and hotels) Impel Market System S.K. 3 Wrocław cleaning services Impel Catering Company S.K. Wrocław catering (preparation and delivery of food) 9. Tech Solutions 4 Wrocław outsourcing services 10. Consensus Company 11. Dąbrowa Górnicza catering (preparation and delivery of food) Market System sp. z o. o. 5 Wrocław outsourcing services 12. Consensus Investment Wrocław outsourcing services 13. Brokers Union Wrocław insurance brokerage 14. Ubezpieczaj.pl Wrocław insurance brokerage 15. Impel Airport Partner Wrocław handling services 16. Impel Rental PRO S.K. Wrocław rental and service of clothes and bed linen and laundry of clothes (workwear) 17. PRO Wrocław outsourcing services 18. Praxima Krakpol Alwernia 19. Agrobud BHP S.A. Wrocław laundry services for the hospital and hotel industries production and sale of industrial safety products 20. Impel Griffin Group TOV Kiev (Ukraine) CLEANING SERVICES in in in in in in in in in in in in 46,39% Impel Cleaning 1,53% Company 10,07% Impel S.A. 9,19% Impel Agile S.A. 26,26% Impel Security Polska 6,56% Impel Cash Solutions 20,55% Impel Cleaning 0,21% Company 79,24% Impel S.A. 73,6% Impel Cleaning 26% Impel S.A. 0,4% Company sp. z o.o. 60,1% Impel Cleaning sp. z o. o. 39,85% Impel S.A. 0,05% Market System sp. z o. o. 74,03% Impel Cleaning sp. z o. o. 0,08% Company sp. z o. o. 25,88% Impel S.A. 100% Impel S.A. 67,2% Investment Partner 32,8 % third parties 100% Impel S.A. 100% Consensus Company 51% Impel S.A. 49% third parties 100% Brokers Union 100% Impel Cleaning 99,92% Impel S.A. 0,08% PRO 100% Impel S.A. 70% Impel Cleaning 30% third parties 100% Impel Cleaning 61% Impel Cleaning 39% third parties 21. Impel Serviks SIA Riga (Latvia) cleaning services 66,99% Impel S.A. 33,01% third parties 22. Impel Expert TOO Astana (Republic of Kazakhstan) outsourcing services 61% Impel S.A. 39% third parties 4

5 23. Impel Security Polska Wrocław manned security of property 100% Impel S.A. 24. Impel Provider Security Partner S.K. Wrocław manned security of people and property in 99,7% Impel Security Polska 0,3% Security Partner 25. Security Partner Wrocław outsourcing services 100% Impel S.A 26. Impel Security Partner S.K. Wrocław manned security of property in 99,01% Impel Security Polska 0,99% Security Partner 27. Gwarant Agencja Ochrony S.A. Opole manned security of people and property 73,1% Impel S.A. 26,9% third parties 28. Security Partner S.K. Wrocław manned security of people and property 90,9% Impel Security Polska 9,1% Security Partner 29. Impel Monitoring S.K. Wrocław designing and installation of electronic security systems, monitoring of signals from alarm and visual systems in 0,02% Impel Monitoring 99,98% Impel Security Polska 30. Impel Monitoring Wrocław outsourcing services in 100% Impel Security Polska Impel Safety Security Partner Sp. z o.o. S.K. Impel Defender Security Partner S.K. Wrocław Wrocław manned security of people and property manned security of people and property 33. TM Security Partner S.K. Wrocław temporary work agency Product Area IS (Industrial Services) in 99% Impel S.A. 1% Security Partner 99% Impel S.A. 1% Security Partner 99% Impel Security Polska 1% Security Partner 34. Impel Tech Solutions S.K. 6 Warsaw technical maintenance of property, installation of ventilation and air conditioning systems, technical and engineering services in 91,8% Impel Cleaning 0,1% Tech Solutions 8,1 Impel S.A. 35. Construct Solutions Wrocław outsourcing services in 100% Impel Cleaning 36. ZUH Partner Nieruchomości Dąbrowa Górnicza technical maintenance of facilities in 100% Impel Cleaning 37. Investment Partner Dąbrowa Górnicza real estate acquisition and sale in 100% Impel Cleaning 38. Climbex S.A. Opole 39. Climbex Industrial Solutions GmbH Dinslaken (Germany) specialized cleaning services for production plants specialized cleaning services for production plants in in 70% Impel S.A. 30% Impel Cleaning 100% Climbex S.A. 5

6 40. Integrum Management Warsaw property management in 50,1% Impel Cleaning 49,9% third parties 41. Impel Synergies Wrocław Integrated FM 100% Impel S.A. 42. Insperit Data Management sp. z o.o Wrocław IT services 60% Impel S.A. 40% third parties 43. Impel Visual Solutions S.A. Wrocław 44. Rebranding Poland Sp. z o.o. Wrocław Production and assembly of elements of signage in facilities Production and assembly of elements of signage in facilities in in 75% Climbex S.A. 25% third parties 100% Impel Visual Solutions S.A. Product Area Digital Services & Business Process Outsourcing (Digital Services & BPO) 45. SIConsulting Wrocław 46. SIeCommerce 7 Wrocław telecommunication and IT services, consulting in the scope of configuration and implementation of integrated IT systems configuration and implementation of hybris platform in 51% Impel S.A. 49% third parties 85% SIConsulting 15% third parties 47. Impel Business Solutions Wrocław accounting services, consulting in the scope of business activity, HR and payroll services 100% Impel S.A. 48. Spółdzielnia Wsparcia Biznesu IBS w likwidacji Wrocław accounting services, consulting in the scope of business activity, HR and payroll services, financial audit, telecommunication and IT services in Impel Business Solutions sp. z o.o Audyt Partner, SIConsulting 49. Business Tax Professionals S.K. 8 Wrocław 50. Impel Cash Solutions 9 Warszawa Financial audit Tax consulting cash processing services (handling and processing of cash) in in 99,3% Impel Business Solutions sp. z o.o 0,7% Audyt Partner 100% Cash Handling Center 51. Impel Digital Wrocław Trade services 52. Impel ATM Management S.K. 10 Wrocław 53. Cash Handling Center Wrocław cash processing services (handling and processing of cash) cash processing services (handling and processing of cash) 54. ATM Management Warszawa outsourcing services 55. BPO 11 Wrocław outsourcing services in 100% Impel S.A. 63,64 % Impel S. A. 36% Impel Cash Solutions 0,36% ATM Management 100% Impel S.A. 100% Impel S.A. 100% Impel S.A Biuro Podróży Partner BPO sp. z o.o. S.K. Sanpro Job Service w likwidacji Dąbrowa Górnicza Wrocław tour operator temporary work agency in 99% Impel Cleaning 1% BPO 99,75% Impel S.A. 0,25% BPO 6

7 58. Sanpro PTS BPO S.K. Wrocław temporary work agency in 99,82% Sanpro Job Service 0,18% BPO Sanpro Interim BPO S.K. 12 Wrocław temporary work agency Sanpro Consulting BPO S.K. Wrocław temporary work agency in 21,73% Impel Cleaning 0,01% BPO 78,26% Impel S.A. 83,32% Impel Cleaning 16,67% Impel S.A. 0,01% BPO 61. Sanpro Synergy Wrocław temporary work agency in 100% Impel Cleaning Supporting companies 62. MarketCo Wrocław marketing services 63. Rent Management Wrocław outsourcing services House Rent Management S.K.A. Asset Rent Management ARM Finanse Rent Management S.K. Wrocław Wrocław Wrocław property rental outsourcing services financial services Owner Rent Management sp. z o.o. S.K. Wrocław outsourcing services Centrum BadawczoRozwojowe Partner 13 Wrocław R&D 69. Impel Agile S.A. Wrocław outsourcing services Sports 14 Wrocław outsourcing services 71. Impel Perfekta Chojnów 72. Elkom Brzezie Jointly controlled and associated companies laundry services for the hospital and hotel industries cleaning services, property management in in associated undertaking in co undertaking 100% Impel S.A. 100% Impel S.A. 100% Impel S.A. 0,1 % ARM Finanse Rent Management S.K. 99,9 %Impel S.A. 99,99% Impel S.A. 0,01% Rent Management 7 100% Impel S.A. 100% Impel S. A. 100% Impel S.A. 100% Impel Agile S.A. 50% Impel Cleaning 50% Perfekta Beteiligungsgesellschaft mbh 31,58% Impel Cleaning 68,42% third parties 1) On partners of Impel Food Hygiene Company S.K. adopted a resolution under which the Partner i.e. Impel S.A. as a limited partner the Partners of Impel Food Hygiene Company S.K. agreed to increase the shares of the limited partner Impel S.A. by PLN 773,000. As a result of the increase, the contribution of the limited partner Impel Spółka Akcyjna rose to PLN 3,273,000, i.e % in profits and losses of the limited partnership. On Company Sp. z o.o. disposed of its rights and obligation in Impel Food Hygiene Company Sp. z o.o. Sp. k. to Tech Solutions Sp. z o.o. As a result, the company agreement of Impel Food Hygiene Company Sp. z o.o. S. K. changed, and consequently its name changed to Impel Food Hygiene Tech Solutions Sp. z o.o. S.K. 2) On DC System Company S.K. was joined by Impel S.A. as a limited partner, bringing contribution of PLN 1,559,000 i.e % in profits and losses of the limited partnership. On Partners of DC System Company S.K. agreed to raise the contribution of the General Partner Impel Cleaning up to PLN 4,406,900. Impel Cleaning now holds 73.6 % shares in profits and losses of the limited partnership. 3) On Impel Market Company S.K. was joined by Impel S.A. as a general partner, bringing contribution of PLN 756,000 i.e % in profits and losses of the limited partnership. On based on the concluded agreement the limited partner Company disposed of shares in Impel Market Company S.K. to Market System On Partners of Impel Market Company S.K. decided to change the name of the company to Impel Market System S.K. 4) On Partners of Rest&More changed the name of the company to Tech Solutions The changes were registered with the National Court Register (KRS.) on ) On the extraordinary GM of Consensus Company Bis agreed to dispose the shares of Consensus Company Bis by its partner Consensus Investment to Impel S.A. On the extraordinary GM of Consensus Company Bis adopted a resolution concerning the change of the name to Market System The changes were registered with the National Court Register (KRS.) on equity method equity method

8 6) On Impel Tech Solutions Company S.K. was joined by a new Partner i.e. Impel S.A. as the general partner. Impel S.A brought in contribution of PLN 1,000,000 and participates in losses and profits of the company having a share of 8.1%. On the current general partner Company disposed of all of its rights and obligation to Tech Solutions sp. z o. o., which was confirmed by changing the company s agreements. 7) On A Partner SIConsulting disposed of 5 shares SIeCommerce with the total value of PLN 250 to an external entity. The changes have not yet been registered with the National Court Register (KRS.).. 8) Accounting Audyt Partner S.K. by way of a resolution of its Partners dated changed the name to Business Tax Professionals S.K. 9) On Impel Cash Services Sp. z o.o. was taken over by Impel Cash Solutions 10) On 28 August 2017 Impel ATM Management S.K. was joined by Impel S.A. as a general partner. The current shareholding structure: Impel S.A. contribution of PLN 350,000 i.e %; Impel Cash Solutions a general partner, contribution of PLN 198,000 i.e. 36%; ATM Management S.K a limited partner contribution of PLN 2,000 i.e. 0.36%. 11) On the sole shareholder of BPO disposed of 100% shares in the company to Impel S.A. The changes have not yet been registered with the National Court Register (KRS.). 12) On the Partners of Sanpro Interim BPO S.K. decided to raise the contribution of the general partner i.e. Impel S.A. amount of PLN 400,000 to PLN 4,000, ) On the extraordinary GM of Centrum BadawczoRozwojowe Partner adopted a resolution on disposal by its partner Investment Partner 1,000 shares to Impel S.A. As of the date of this report, the changes have not yet been registered with the National Court Register (KRS.). The changes were registered with the National Court Register (KRS.).on ) On the extraordinary GM of 4 Sports decided to change the name of the company to Catering sp. z o.o. The changes have not yet been registered with the National Court Register (KRS.) 8

9 II. CONDENSED QUARTERLY FINANCIAL STATEMENTS OF THE IMPEL GROUP 1. CONDENSED QUARTERLY STATEMENT Of FINANCIAL POSITION OF THE IMPEL GROUP ASSETS Note 30 Sep Dec 2016 I. Noncurrent assets (items 19) 337, , Goodwill II ,009 45, Other intangible assets II ,699 33, Property, plant and equipment II , , Investment property 7,684 8, Noncurrent receivables II.5.4 6,147 7, Investments in associated undertakings consolidated with equity method 6,572 6,519 7 Other financial assets II , Prepayments and accrued income II.5.6 2,864 1, Deferred tax assets V ,690 34,356 II. Current assets (items 17) 704, , Inventories 24,151 22, Trade and other receivables II , , Receivables from state and local budgets, including: 43,535 43,788 Current tax receivables 232 3, Other financial assets II ,344 34, Cash and cash equivalents 63,230 66, Prepayments and accrued income II ,494 32, Assets classified as held for sale Total assets I+II 1,041, ,292 9

10 EQUITY AND LIABILITIES Note 30 September I. Total equity and liabilities (1+2) 331, , Equity of the Parent Undertaking (items 1a1g) 314, ,680 1a. Share capital 64,326 64,326 1b. Reserve funds 107, ,178 1.c Supplementary capital 99,292 80,570 1d. Other capital reserves (207) (207) 1e. Currency translation differences resulting from recalculation of foreign entities (1,587) (1,363) 1f. Retained profit/(loss carryforward) 35,453 12,160 1g. Current year net profit/(loss) 9,911 20, Capital attributable to noncontrolling interests 16,900 15,905 II. Noncurrent liabilities (items 17) 67,191 71, Deferred tax liability V ,228 3, Employee benefits V ,494 1, Noncurrent bank loans and borrowings II ,301 10, Noncurrent financial lease liabilities 38,723 42, Deferred income 1,684 1, Noncurrent provisions V Other noncurrent liabilities II ,666 10,916 III. Current liabilities (items 17) 642, , Current bank loans and borrowings II , , Trade payables II , , Public charges, including: II ,694 61,852 3a. Current tax liabilities 9,535 6, Employee benefits V ,977 52, Current financial lease liabilities 18,834 20, Deferred income 1,348 1, Current provisions V ,527 3,400 Total equity and liabilities I+II+III 1,041, ,292 10

11 2. CONDENSED STATEMENT OF COMPREHENSIVE INCOME OF THE IMPEL GROUP Note (Transformed) (transformed) I. Revenue from sales and subsidies (items 12): 574,408 1,698, ,203 1,534, Sales revenue, including: 563,717 1,667, ,692 1,504, Other revenue subsidies 10,691 30,973 10,511 29,963 II. Operating expenses (items 17): (559,132) (1,662,436) (521,323) (1,502,492) 1. Depreciation and amortisation (12,893) (38,409) (13,513) (39,879) 2. Raw materials and energy used (36,345) (114,369) (42,673) (125,869) 3. Contracted services (256,627) (792,325) (257,009) (713,474) 4. Salaries and wages, social security and other employee benefits (228,846) (643,310) (180,790) (546,001) 5. Other cost by type (9,643) (29,029) (9,435) (28,014) 6. Selling costs materials and goods for resale (15,069) (45,555) (18,069) (49,633) 7. Change in products A. Profit/(loss) on sales (I+II) 15,276 35,835 16,880 32,284 I. Other operating income II ,765 12,670 2,406 11,578 II. Other operating expenses, including: II.5.15 (5,780) (14,625) (3,238) (8,835) B. Operating profit/(loss) (A+1+2) 13,261 33,880 16,048 35, Financial income II ,948 2,517 4,099 (7,867) 2. Interest (2,724) (8,829) (3,071) 3. Other financial expenses II.5.17 (2,053) (5,825) (1,724) (4,711) C. Pretax profit/(loss) (B+1+2+3) 8,769 21,174 13,770 26,548 I. Corporate income tax II.5.18 (4,533) (6,982) (3,114) (1,588) D. Share in profit (loss) of an undertaking valued with the equity method (48) E. Net profit/(loss) (C+I+D) 4,188 14,314 10,687 25,072 Other comprehensive income Items that may be moved to the result in next reporting periods Currency translation differences resulting from consolidation (80) (352) (3,549) (4,188) Items that will not be moved to the result in next reporting periods Actuarial profit/(loss) Total comprehensive income 4,108 13,962 7,138 20,884 Net profit/(loss): 4,188 14,314 10,687 25,072 attributable to shareholders of the Parent Undertaking 3,571 9,911 8,741 21,609 attributable to noncontrolling interests 617 4,403 1,946 3,463 Total comprehensive income 4,108 13,962 7,138 20,884 attributable to shareholders of the Parent Undertaking 3,522 9,687 5,269 17,504 attributable to noncontrolling interests 586 4,275 1,869 3,380 Net profit attributable to shareholders of the Parent 8,741 21,609 3,571 9,911 Undertaking Earnings/(loss) per ordinary share 0,28 0,77 0,68 1,68 Diluted profit (loss) per share 0,28 0,77 0,68 1,68 11

12 2. CONDENSED STATEMENT OF CHANGES IN CONSOLIDATED EQUITY OF THE IMPEL GROUP Capital attributable to shareholders of the Parent Undertaking 1 Jan 2017 Share capital Reserve funds Other capital reserves Other capital (actuarial losses) Currency translation differences resulting from recalculation of foreign entities Retained earnings/loss carryforward* Net result TOTAL Noncontrolling interest TOTAL As at , ,178 80,570 (207) (1,363) 32, ,680 15, ,585 Comprehensive income (224) 9,911 9,687 4,275 13,962 net profit (loss) 9,911 9,911 4,403 14,314 differences resulting from consolidation of foreign (204) (224) (128) (352) undertakings Transactions with owners: (19,778) 18,722 3,277 2,221 (3,280) (1,059) dividend (3,260) (3,260) previous years losses written off (31,839) 31,839 Transfer of retained profit supplementary and reserve 2,974 2,974 2,974 capitals Recognition of options for share purchase 9,840 18,722 (28,562) change in capital attributable to noncontrolling interests, resulting from acquisition or (753) (753) (20) (773) disposal of companies As at 64, ,400 99,292 (207) (1,587) 35,453 9, ,588 16, ,488 * As at , retained profits in the amount of PLN 32,176,000 result from the net result for 2016 in the amount of PLN 20,016,000 and retained profits as at in the amount of PLN 12,160,

13 1 Jan Share capital Capital attributable to shareholders of the Parent Undertaking Reserve funds Other capital reserves Other capital (actuarial losses) Currency translation differences resulting from recalculation of foreign entities Retained earnings/loss carryforward* Net result TOTAL Noncontrolling interest As at , ,249 72, (1,615) 42, ,153 18, ,689 Comprehensive income (4,105) 21,609 17,504 3,380 20,884 net profit (loss) 21,609 21,609 3,463 25,072 differences resulting from consolidation of foreign (4,105) (4,105) (83) (4,188) undertakings Transactions with owners: 7,006 8,449 (30,731) (15,276) (6,159) (21,435) dividend (12,865) (12,865) (6,448) (19,313) previous years losses written off (50) 50 Transfer of retained profit supplementary and reserve 9,467 8,449 (17,916) capitals Recognition of options to share purchase (1,929) (1,929) (1,929) change in capital attributable to noncontrolling interests, resulting from acquisition or (482) (482) 289 (193) disposal of companies As at , ,255 80, (5,720) 12,160 21, ,381 15, ,138 * As at , retained profits in the amount of PLN 42,891,000 result from the net result for 2015 in the amount of PLN 22,897,000 and retained profits as at in the amount of PLN 19,994,000. TOTAL 13

14 3. CONSOLIDATED STATEMENT OF CASH FLOWS OF THE IMPEL GROUP A. Cash flows from operating activities I. Net profit of Parent Undertaking 9,911 21,609 II. Total adjustments 59,682 (21,129) 1. (Profit)/loss attributable to minority interests 4,403 3, Depreciation and amortization 38,409 39, Interest and distributions from profit (dividends) 7,219 6, (Profit)/loss on investing activities (3,110) (5,180) 5. Change in working capital 7,637 (62,404) 5a. Change in current tax liabilities 2,656 6, Other adjustments 5,124 (2,973) III. Net cash provided by/(used in) operating activities (I+II) 69, B. Cash flows from investing activities I. Cash provided by investing activities 7,083 6, Sale of intangible assets and property, plant and equipment and investments in property 4,248 4, repayment of loans advanced 1,845 1, interest received other cash provided by investment activities II. Cash used in investing activities (30,110) (28,503) Acquisition of intangible assets and property, plant and equipment 1. investment activities (23,682) (17,439) 2. acquisition of shares (2,561) 3. loans advanced (467) (4,516) 4. Dividends and other distributions from profit to minority interests (2,753) (6,548) 5. Other investing expenses (647) III. Net otcash provided by/(used in) investing activities (I+II) (23,027) (22,320) C. Cash flows from financing activities I. Cash provided by financial activities 45,309 96, Increase in loans and borrowings 45,309 96,318 II. Cash used in financial activities (94,073) (71,577) 1. Dividends and other distributions to shareholders (12,865) 2. Repayment of loans and borrowings (68,035) (35,468) 3. Decrease in financed lease liabilities (16,886) (15,601) 4. Interest paid (9,152) (7,643) III. Net cash provided by/(used in) financing activities (I+II) (48,764) 24,741 D. Total net cash flow (A.III+B.III+C.III) (2,198) 2,901 E. Balancesheet change in cash, including: (2,842) 2,067 Change in cash due to FX differences (644) (834) F. Cash at beginning of period 66,072 69,394 G. Cash at end of period (F+D)* 63,230 71,461 *the difference between balancesheet cash and the cash at end of period PLN () 644,000 results from FX arising from valuation of cash denominated in EURO at 30 September

15 4. SELECTED EXPLANATORY NOTES NOTE 1 GOODWILL Gross goodwill at the beginning of the period: 58,461 58,126 Increase on acquisition * Gross goodwill at the end of the period: 58,500 58,461 Accumulated impairment of value at the beginning of the period: (12,491) (10,991) Impairment of value recognized during year (1,500) Accumulated impairment of value at the end of the period: (12,491) (12,491) Net goodwill 46,009 45,970 *related to purchase of Impel Visual Solutions S.A. More information in V.6 of the financial statements. Within the reporting period the Group assessed possible risk of impairment of value. The estimated showed no need to create valuation allowance for goodwill. NOTE 2 OTHER INTANGIBLE ASSETS a) acquired permits, licences, patents and similar assets 25,991 29,279 b) other intangible assets 1,430 2,827 c) intangible assets under construction 4,278 1,197 Total other intangible assets 31,699 33,303 As at 30 September 2017, Group s companies did not enter into agreements obliging them to purchase intangible and legal assets. 15

16 Change in 9month period ended 30 September 2017 CHANGES IN OTHER INTANGIBLE ASSETS (BY TYPE) acquired permits, patents, licences and similar assets other intangible assets intangible assets under construction Total intangible assets a) gross intangible assets at beginning of period 65,857 16,719 1,197 83,773 b) increase ,692 4,646 acquisition and settlement of intangible assets under construction ,692 4,478 connected with acquisition of companies c) decrease (772) (180) (611) (1,563) disposal (44) (44) liquidation (273) (80) (353) F/x differences (12) (100) (112) settlement of intangible assets under construction (611) (611) connected with acquisition of companies (443) (443) d) gross intangible assets at end of period 65,961 16,617 4,278 86,856 e) accumulated depreciation at beginning of period 36,578 13,383 49,961 f) depreciation for period 3, ,207 increase 3, ,722 current period depreciation 3, ,613 connected with acquisition of companies decrease (335) (180) (515) sale (17) (17) liquidation (269) (80) (349) F/X differences (12) (100) (112) connected with acquisition of companies (37) (37) g) accumulated depreciation at end of period 39,970 14,198 54,168 h) impairment charges at beginning of period (509) (509) increase (480) (480) use release i) impairment charges at end of period (989) (989) j) net other intangible assets at end of period 25,991 1,430 4,278 31,699 16

17 Change in 9month period ended 30 September 2016 CHANGES IN OTHER INTANGIBLE ASSETS (BY TYPE) acquired permits, patents, licences and similar assets other intangible assets intangible assets under construction Total intangible assets a) gross intangible assets at beginning of period 64,565 15, ,760 b) increase 1,171 1,477 2,575 5,223 acquisition and settlement of intangible assets under construction 1,171 1,477 2,575 5,223 c) decrease (41) (493) (893) (1,427) liquidation (41) (413) (454) F/x differences (80) (80) settlement of intangible assets under construction (893) (893) d) gross intangible assets at end of period 65,695 16,595 2,266 84,556 e) accumulated depreciation at beginning of period 31,510 12,396 43,906 f) depreciation for period 4, ,794 increase 4,256 1,070 5,326 current period depreciation 4,256 1,070 5,326 decrease (39) (493) (532) liquidation (39) (413) (452) F/X differences (80) (80) g) accumulated depreciation at end of period 35,727 12,973 48,700 h) impairment charges at beginning of period (509) (509) increase use release i) impairment charges at end of period (509) (509) j) net other intangible assets at end of period 29,968 3,113 2,266 35,347 17

18 NOTE 3 PROPERTY, PLANT AND EQUIPMENT a) tangible assets, including: 173, ,623 land 4,201 4,201 buildings and structures 39,694 41,559 plant and equipment 79,492 83,666 vehicles 32,216 35,969 other tangible assets, including: equipment for the provision of services 17,904 17,228 b) tangible assets under construction 6,559 3,013 Property, plant and equipment 180, ,636 As at 30 September 2017 the Group s companies entered into agreements obliging them to purchase fixed assets for the total of PLN 233,000. Change within the 9month period ended 30 September 2017 CHANGES IN TANGIBLE ASSETS (BY TYPE) a) gross tangible assets at beginning of period Land buildings and structures plant and equipment vehicles 18 other tangible assets tangible assets under constructi on total tangible assets 4,201 60, ,406 73,827 53,871 3, ,788 b) increase ,556 3,200 7,849 20,412 46,269 acquisition and settlement of tangible assets under construction ,158 3,200 7,849 20,412 45,871 connected with acquisition of company c) decrease (695) (4,578) (3,873) (5,010) (16,866) (31,022) disposal (7) (1,882) (3,480) (2,389) (7,758) liquidation (688) (2,410) (365) (2,562) (6,025) FX differences (286) (28) (59) (373) settlement of tangible assets under construction (16,825) (16,825) connected with acquisition of company (41) (41) d) gross tangible assets at end of period 4,201 60, ,384 73,154 56,710 6, ,035 e) accumulated depreciation at beginning of period 17, ,549 37,858 36, ,418 f) depreciation for period: 1,439 14,152 3,080 2,163 20,834 increase 2,082 18,344 6,642 6,582 33,650 current period depreciation 2,082 18,328 6,642 6,582 33,634 connected with acquisition of company decrease (643) (4,192) (3,562) (4,419) (12,816) disposal (7) (1,756) (3,280) (1,868) (6,911) liquidation (636) (2,262) (271) (2,507) (5,676) FX differences (174) (11) (44) (229) g) accumulated depreciation at end of 18, ,701 40,938 38,805 period 246,252 h) impairment charges at beginning of (1,542) (191) (1) period (1,734) increase use release i) impairment charges at end of period (1,525) (191) (1) (1,717) j) net tangible assets at end of period 4,201 39,694 79,492 32,216 17,904 6, ,066

19 Change within the 9month period ended 30 September 2016 CHANGES IN TANGIBLE ASSETS (BY TYPE) a) gross tangible assets at beginning of period Land buildings and structures plant and equipment vehicles other tangible assets tangible assets under constructi on total tangible assets 4,201 60, ,952 69,055 46,985 1, ,360 b) increase 2,275 20,368 6,116 6,766 27,736 63,261 acquisition and settlement of tangible assets under construction 2,275 20,368 6,109 6,766 27,736 63,254 FX differences 7 7 c) decrease (2,078) (13,320) (4,963) (1,636) (24,981) (46,978) sale (631) (10,257) (4,351) (1,333) (16,572) liquidation (1,447) (3,017) (612) (294) (5,370) FX differences (46) (9) (55) settlement of tangible assets under construction (24,981) (24,981) d) gross tangible assets at end of period 4,201 60, ,000 70,208 52,115 4, ,643 e) accumulated depreciation at beginning of period 16, ,787 35,925 30, ,746 f) depreciation for period: 920 6,492 1,413 5,334 14,159 increase 2,417 19,338 6,072 6,601 34,428 current period depreciation 2,417 19,338 6,067 6,601 34,423 FX differences 5 5 decrease (1,497) (12,846) (4,659) (1,267) (20,269) sale (112) (10,047) (4,123) (1,020) (15,302) liquidation (1,385) (2,772) (536) (234) (4,927) FX differences (27) (13) (40) g) accumulated depreciation at end of 17, ,279 37,338 35,844 period 221,905 h) impairment charges at beginning of (1,525) (191) (1) period (1,717) increase use release i) impairment charges at end of period (1,525) (191) (1) (1,717) j) net tangible assets at end of period 4,201 41,758 82,530 32,870 16,270 4, ,021 NOTE Noncurrent trade and other receivables financed lease receivables 2,311 2,288 receivables under bid securities, sureties and guarantees 1,440 1,612 receivables from investments 1,886 2,893 other receivables Total noncurrent trade and other receivables 6,147 7,595 NOTE 5 OTHER NONCURRENT FINANCIAL ASSETS Other financial assets valued at fair value by financial result Financial assets available for sale Loans and borrowings 17,698 Total other financial assets 17,

20 NOTE 6 NONCURRENT PREPAYMENTS AND ACCRUED INCOME Cost of contracted services for future periods 2,864 1,055 Other 1 Total noncurrent prepayments and accrued income 2,864 1,056 NOTE 7 TRADE AND OTHER RECEIVABLES trade receivables 467, ,029 financed lease receivables 1,591 1,646 bid securities Deposits 4,202 4,012 prepayments transferred 4,671 2,867 other settlements with employees 1, receivables from refinancing contractors liabilities 997 2,197 receivables from investments* 5,721 2,299 other receivables 4,355 2,684 Total trade and other receivables 490, ,503 *including PLN 5,097,000 as receivable from disposal of Optima Care NOTE 8 OTHER CURRENT FINANCIAL ASSETS Other financial assets valued at fair value by financial result Investments held until maturity Loans and borrowings 13,144 33,757 Total other financial assets 13,344 34,038 An increase in noncurrent loans results from reclassification of current loans in connection with annexes to the agreements prolonging maturity dates. The balance of loans granted by the Group contains current loans advanced to Logistics totalling PLN 9,000,000 secured with registered pledge set by the Court on the receivables from the State Treasury i.e. on the disputed VAT. Potential risk of nonpayment of the loans relating to risk of an adverse resolution of the proceedings before the National Administrative Court regarding the recovery of VAT by Impel Logistics (according to the company, the validity of the questioned right is supported by a number of judgments of the Court of Justice of the European Union). In 2010 a tax inspection was initiated with regard to Logistics concerning the grounds for the refunding of input VAT on account of intracommunity supplies carried out in 2010, for the period from October to November The authority of original jurisdiction passed a decision refusing the refund of the surplus tax, and the decision was upheld by the appellate authority on 30 September The Company filed a complaint about the appellate authority decision to the Provincial Administrative Court in Wrocław. On 25 February 2015, the Provincial Administrative Court in Wrocław passed a verdict (I SA/Wr 2429/14) in which it upheld the decision of the appellate authority. The verdict is not final and binding. The Company has received the written reasons from the Provincial Administrative Court judgment and filed an extraordinary appeal to the Supreme Administrative Court, which until now has not been considered. In the opinion of the Logistics Management Board, the declaration of intra Community supplies of goods and the application of the zero VAT rate is reasonable and properly documented. The Company has a complete set of documents required under Article 42.3 of the Value Added Tax Act, which confirms the export of the goods from Poland and the documents required under Paragraph 11 of the same article. At the same time, the Company had the right to claim the 20

21 recovery of VAT on the relevant purchases; in particular on account of all duediligence procedures having been observed in the transaction in question. In the opinion of the Company, the correctness of its position is confirmed by a number of judgments of the Court of Justice of the European Union, e.g. C642/11, C643/11, C285/11, C33/13, AND C563/11. As at the balancesheet date the refund of VAT under proceedings amounts to PLN 9,778,000. The Company cannot predict when the abovementioned proceedings finish. Impel S.A. is also aware that Logistics is burdened with the risk of another additional liability concerning the refund of deducted VAT in the amount of PLN 5,480,000, as an enforceable decision was issued in connection with another VATrelated inspection in the Company for the period July September In June 2015 the fiscal authorities started a tax inspection with a similar scope, but concerning other periods of 2010 (JulySeptember 2010), for which the company received a refund of VAT. The factual circumstances regarding the periods subject to ongoing inspection are similar to the facts already questioned by the fiscal authorities during the earlier proceedings, referred to hereinabove. The fiscal authority of the first instance in its decision of 23 December 2015 delivered to the Company on 11 January 2016), questioned the previous refund of VAT for the abovementioned periods. Logistics informed Impel S.A., that it appealed against the decision to the authority of the second instance (Wrocław Revenue Office), and together with an appeal to stop enforcement of the decision. On 16 March 2017, the Provincial Administrative Court suspended court and administrative proceedings due to possible limitation rule the Polish Constitutional Tribunal considers the abovementioned doubts (sign. K 31/14). The company received information about bankruptcy proceedings initiated against Logistics sp. z.o.o. which is underway. In the opinion of Management Board of Impel S.A. there is no risk of these loans impairment. The company declares that lawsuits should end in Q NOTE 9 CURRENT PREPAYMENTS AND ACCRUED INCOME 30 Sep Dec 2016 insurance policies 5,411 4,810 cost of contracted services related to future periods 2,799 3,594 overhauls noninvoiced income on longterm contracts 59,731 23,658 other Total current prepayments and accrued income 68,494 32,393 The presented noninvoiced income on longterm contracts contains provisions for contracts underway estimated by participation of costs incurred from beginning of work till the moment the income is achieved against the total cost of completed service. The largest items: Impel Tech Solutions sp. z o.o. (PLN 42,573,000), Construct Solutions (PLN 7,754,000), Climbex S.A. (PLN 7,396,000), and Insperit Data Management (PLN 1,475,000). NOTE 10 NONCURRENT LOANS AND BORROWINGS ,457 1,416 Loans Borrowings 5,885 9,351 Total non current loans and borrowings 7,301 10,808 NOTE 11 OTHER NONCURRENT LIABILITIES liabilities relating to acquisition of noncontrolling interest (including valuation of options)* 11,374 8,958 liabilities relating to UE subsidies retained security deposits 1,282 1,105 other liabilities Total, current trade and other payables 13,666 10,916 *Liability relating to purchase noncontrolling interest shares from Gwarant Agencja Ochrony S.A., Brokers Union, Integrum Management and SiConsulting and Impel Visual Solutions SA. Data Partner. 21

22 NOTE 12 CURRENT LOANS AND BORROWINGS Loans 853 1,261 Borrowings 266, ,116 Total current loans and borrowings 267, ,377 A decrease in noncurrent bank loans and borrowings, the value of which as at 30 September 2017 was lower by PLN 20,330,000 was related mainly to smaller need for working capital. NOTE 13 CURRENT TRADE AND OTHER PAYABLES trade payables 190, ,291 liabilities relating to purchase of tangible and intangible assets 3,264 3,428 liabilities under security deposits, security or guarantees 9 38 liabilities under insurance agreements 3,460 1,253 factoring liabilities security deposits received from customers other settlements with employees liabilities relating to UE subsidies Dividends 1,486 Liabilities under buyout of noncontrolling interest (valuation of options) Climbex SA 3,517 other liabilities 3,722 1,631 Current trade and other payables 203, ,370 NOTE 14 OTHER OPERATING INCOME Revenue on sale of nonfinance noncurrent assets 3,293 5,236 Reversal of valuation allowances for assets 2,145 1,925 Release of provisions for disputed claims 258 Received penalties and damages 1,602 1,318 Interest received from contractors 3,254 1,455 Reimbursement of court fees and costs of proceedings Remuneration of a payer from PIT4 contribution Currency translation differences Other 1,444 1,058 Total other operating income 12,670 11,578 NOTE 15 OTHER OPERATING EXPENSES Loss on sale of nonfinance noncurrent assets Valuation allowances for assets 5,666 3,011 Creation of provisions for disputed claims 79 Penalties, fines, damages 4,041 2,637 Fees to the Public Procurement Office Donations Net value of liquidated tangible assets and intangible assets Court fees and costs of proceedings Costs related to damages Currency translation (FX) differences 535 Trade receivables writtenoff

23 Other 2,088 1,005 Total other operating expenses 14,625 8,835 NOTE 16 FINANCIAL INCOME Interest 1,610 1,683 Guarantee and surety fees Revaluation of investments FX differences 303 2,072 Total financial expenses 1,948 4,099 NOTE 17 OTHER FINANCIAL EXPENSES Loan fees 2,212 1,144 Guarantee and surety fees 1,597 2,237 Discount for options Negative FX differences 961 Other Total financial expenses 5,825 4,711 NOTE 18 INCOME TAX Current tax on income in the financial year (10,454) (10,399) Total current income tax (10,454) (10,399) Timing differences and their reversal 3,472 8,811 Total deferred income tax 3,472 8,811 Total income tax (6,982) (1,588) FINANCIAL RESULT BURDEN Pretax profit 21,174 26,548 Tax calculated according to Parent Undertaking rate 4,023 5,044 Effect of using other tax rates applied abroad, and 15% rate for (500) (79) part of the companies Nontaxable income (356) (625) Non tax deductible costs 3,490 1,051 Use of previously unrecognized tax (7) Tax losses from which no deferred tax assets were recognized* Creation of assets for timing differences in reported period (8,305) Offbalancesheet tax income 4,341 23

24 Inclusion of deferred tax asset recognized in previous years (768) Previous years adjustment 1,046 Total financial result burden 6,982 1,588 *The amount results mainly from recognition an asset occurring due to timing difference between tax value of the shares of: Sanpro Job Services Sp. z o.o. and Sanpro PTS BPO Sp. z o.o. S.K. and the net value of the assets of these companies. Inclusion of the assets is the result of Impel S.A. Management Board decision to sell the companies. This is to happen before the end of Other explanations to the condensed consolidated statement of financial position An increase in the item assets classified as held for sale results from the decision to sell Sanpro Job Services Sp. z o.o. and Sanpro PTS BPO Sp. z o.o. S.K. Their main assets include current receivables. Planned sale will take place before the end of In 2017 these companies did not already run significant operating activity. As at 30 September 2017, compared to the Annual Report for 2016, there were no significant changes in the values and types of financial instruments. The fair value of cash, current deposits, trade receivables, trade payables, bank overdrafts and other current liabilities did not differ from the balancesheet amounts largely due to the short maturity date. Below are presented financial instruments divided into different classes and categories of assets and liabilities, income and expenses: Financial assets classified as held for sale Financial assets valued at fair value by financial result Loans and financial receivables Financial liabilities valued due to amortized cost Listed shares 74 Unlisted shares 100 Trade receivables (net) 467,538 Cash and deposits 63,230 Loans granted 30,842 Financed lease receivables 3,902 Trade liabilities 190,825 Loans 274,346 Financed lease liabilities 57,557 TOTAL , ,728 Financial assets available for sales Loans and financial receivables and internal settlements Financial liabilities valued due to amortized cost TOTAL Income from dividends Income/ expenses from interests disclosed in : 4,491 (8,829) (4,338) Other operating income (interests from trade receivables) Other operating expenses Financial income Financial expenses 3,254 1,237 3,254 1,237 (8,829) (8,829) 24

25 Profit/(loss) due to currency translation differences: 303 disclosed in: 303 Other operating income Other operating expenses Financial income Financial expenses Creation of valuation allowances disclosed in: (5,163) (5,163) Other operating expenses (5,163) (5,163) Financial expenses Release of valuation allowances disclosed in: 1,999 1,999 Other operating income 1,994 1,994 Financial income 5 5 Adjustment of sales from hedging transactions Profit/loss from disposal of financial instruments, included in: Financial income Net profit / (loss) 1,630 (8,829) (7,199) Investments in shares of the companies listed on the stock market (classified as financial assets valued at fair value by financial result) are categorized at Level 1 of the fair value hierarchy. All other financial instruments (presented in the notes above) are classified at Level 2 of the fair value hierarchy by the Group. The method and technique of valuation of instruments measured at fair value did not change compared to the method and technique of valuation as at 31 December Both in the reporting period and in the comparable period there were no transfers between different levels of the fair value hierarchy of financial instruments, as well as there was no change in the classification of instruments due to the change of purpose or use of financial instruments. 25

26 III. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS OF IMPEL S.A. 1. STATEMENT OF FINANCIAL POSITION OF IMPEL S.A. ASSETS Note I. Noncurrent assets (items 18) 214, , Other intangible assets III.5.1 4,159 2, Property, plant and equipment III Investment property 3. 2,841 2,921 Noncurrent receivables 4. III.5.3 3,620 6, Shares in subsidiaries 179, , Other financial assets III.5.4 2,193 Prepayments and accrued income Deferred tax assets V ,761 23,478 II. Current assets (items 16) 87, , Inventories Trade and other receivables III ,422 57, Receivables from state and local budgets, including: Other financial assets III.5.4 3,756 15,708 Cash and cash equivalents III ,851 27, Prepayments and accrued income III. 1,789 Total assets I+II+III 304, ,992 EQUITY AND LIABILITIES Note I. Total equity and liabilities 236, , Equity of the Parent Undertaking (items 1a1f) 236, ,820 1a. Share capital 64,326 64,326 1b. Supplementary funds 62,744 62,744 1.c Capital reserves 90,520 71,799 1d. Other capital (37) (37) 1e. Retained profit/(loss carryforward) (4,733) (4,733) 1f. Current year net profit/(loss) 23,467 18,721 II. Noncurrent liabilities (items 16) 4,810 7, Deferred tax liability V Employee benefits V Noncurrent financed lease liabilities Deferred income Other noncurrent liabilities III.5.7 4,143 6,612 III. Current liabilities (items 17) 63,202 81, Current bank loans and borrowings III ,615 62, Trade and other payables III.5.7 8,868 10, Public charges 8,423 5,983 3a. Current tax liability Employee benefits V ,223 2, Current financed lease liabilities Deferred income Current provisions V Total equity and liabilities I+II+III 304, ,992 26

27 2. STATEMENT OF COMPREHENSIVE INCOME OF IMPEL S.A. Note I. Revenue on sales and subsidies (items 12) 17,762 51,375 14,051 32, Sales revenue: 17,406 50,303 13,670 31, Other revenue subsidies 356 1, ,207 II. Operating expenses (items 17): (11,340) (33,405) (11,369) (31,550) 1. Depreciation and amortization (117) (364) (263) (893) 2. Raw materials and energy used (148) (506) (168) (565) 3. Contracted services (6,161) (17,686) (4,937) (14,609) 4. Salaries and wages, social security and other employee benefits (4,601) (12,867) (4,253) (13,115) 5. Other cost by type (312) (1,981) (1,748) (2,368) 6. Selling costs materials and goods for (1) (1) 7. Change in products A. Profit on sales (I+II) 6,422 17,970 2, Other operating income III.5.8 1,616 13,384 1,688 15, Other operating expenses III.5.9 (161) (2,823) (407) (4,034) B. Operating profit (A+1+2) 7,877 28,531 3,963 11, Financial income III ,733 3,319 6, Cost on interest (355) (1,173) (856) (1,113) 3. Other financial expenses III (1,432) (839) (1,525) C. Pretax profit (B+1+2+3) 8,334 28,659 5,587 15,961 I. Corporate income tax III.5.12 (2,861) (5,192) (1,057) (1,471) D. Net profit (C+I) 5,473 23,467 4,530 14,490 Other comprehensive income Items that may be moved to the result in next reporting periods Items that will not be moved to the result in next reporting periods Actuarial profit/loss Total income 5,473 23,467 4,530 14,490 Earnings/(loss) per share 0,43 1,82 0,35 1,13 Diluted profit (loss) per share 0,43 1,82 0,35 1,13 27