RAWLPLUG GROUP whose parent entity is Rawlplug S.A. ul. Kwidzyńska 6, Wrocław, Poland

Transcription

1 RAWLPLUG GROUP whose parent entity is Rawlplug S.A. ul. Kwidzyńska 6, Wrocław, Poland Opinion and report of an independent statutory auditor on audit of consolidated financial statements for the period from 1 January to 31 December 2015

2 Opinion of an independent statutory auditor for the General Meeting and Supervisory Board of Rawlplug S.A. We reviewed the enclosed consolidated financial statements of Rawlplug Group ("Group"), whose parent entity is Rawlplug S.A. ("Parent"), based in Wrocław, ul. Kwidzyńska 6, consisting of: consolidated statement of financial position as at 31 December 2015, consolidated statement of profit and loss covering the period from 1 January to 31 December 2015, consolidated statement of comprehensive income for the period from 1 January to 31 December 2015, consolidated statement of changes in equity for the period from 1 January to 31 December 2015, consolidated statement of cash flows, additional information on the adopted accounting principles and other explanatory information. The Parent's Management Board is responsible for preparing the Group's consolidated financial statements and report on the Group's operations in compliance with the existing regulations. The Parent's Management Board and members of the Supervisory Board are required to ensure that the financial statements and report on the Group's operations meet the requirements specified in the Accounting Act of 29 September 1994 (Polish Journal of Laws of 2013, item 330, as amended), hereinafter the "Accounting Act." Our objective was to audit and express an opinion on the compliance of these consolidated financial statements with the applicable accounting rules (policy) and on whether they reliably and clearly present, in all significant respects, the Group's asset position, financial standing and financial results. The audit of the consolidated financial statements was carried out in accordance with the provisions of: 1/ section 7 of the Accounting Act, 2/ national financial audit standards issued by the National Chamber of Statutory Auditors in Poland. We planned and carried out the audit so as to obtain rational certainty allowing us to express an opinion on the consolidated financial statements. 2

3 In particular, the audit covered assessment of the validity of the Parent's and its subsidiaries' adopted accounting principles (policy) and significant estimates, verification - largely on a test basis - of documentation being the source of figures and information contained in the consolidated financial statements, as well as an overall assessment of the consolidated financial statements. We consider that the audit provided us with sufficient basis to issue an opinion. We consider that the audited consolidated financial statements, in all significant aspects: a) reliably and clearly present information that is significant from the viewpoint of assessing Rawlplug Group's asset and financial situation as at 31 December 2015 as well as its financial results, b) are prepared in accordance with International Accounting Standards, International Financial Reporting Standards and related interpretations issued in the form of Commission Regulations, and in the scope not addressed in these standards - pursuant to the requirements of the Accounting Act and secondary legislation issued on its basis, c) comply with legal regulations applicable to the Group that could have impact on the content of the consolidated financial statements. The management report on the Group's operations is complete in the meaning of art. 49 sec. 2 of the Accounting Act and takes into considerations the provisions of the Ordinance of the Minister of Finance of February, on current and periodic information disclosed by issuers of securities and the terms for recognising as equivalent information required by the laws of a non-member state (Polish Journal of Laws of 28 January 2014, item 133), and the information contained therein, derived from the audited consolidated financial statements, is compatible with the report. Poznań, 17 March 2016 BDO Sp. z o.o. ul. Postępu Warsaw Entity authorised to audit financial statements no Lead statutory auditor conducting the audit: Acting on behalf of BDO Sp. z o.o.: Beata Wójciak-Dziechciarz Statutory Auditor no dr André Helin President of the Management Board Statutory Auditor no

4 Report on audit of consolidated financial statements OF RAWLPLUG GROUP whose parent entity is Rawlplug S.A. for the period from 1 January to 31 December 2015

5 I. General part of the report 1. Parent's data The parent entity of Rawlplug Group ("Group") is Rawlplug Spółka Akcyjna ("Parent," "Company"). The Parent's registered office is in Wrocław , ul. Kwidzyńska 6. According to the Parent s register entry and Articles of Association, its primary economic activities are: manufacture of tools, fixings and screws, machine tools, plastic materials for construction, metal structures and their parts, wholesale of metal materials, construction materials and machinery used in construction. The Parent operates pursuant to: Articles of Association, drafted in the form of a notarial deed on 6 December 1999 (Rep. A nr 7498/99), as amended, Polish Commercial Companies Code, On 27 August 2001, the Company was entered into the National Court Register at the District Court for Wrocław Fabryczna in Wrocław - 6th Commercial Department, Registry Section, under KRS number The Company has tax identification number NIP: , and REGON: At 31 December 2015, share capital amounted to PLN thousand and was divided into shares with nominal value of PLN 1 each. In 2015 and until the audit was concluded, no changes to share capital took place. As at 31 December 2015, according to Management Board information, the Company's shareholders were as follows: SHAREHOLDING STRUCTURE shares votes at general meeting Amicus Poliniae Sp. z o.o % PKO BP BANKOWY PTE % NATIONALE NEDERLANDEN PTE (formerly ING PTE) % Radosław Koelner % Other % Total % At 31 December 2015, the Parent's equity amounted to PLN thousand. The Parent's Management Board is the Group's lead managing authority. At 31 December 2015, the Management Board comprised: - Radosław Koelner President of the Management Board - Piotr Kopydłowski Member of the Management Board, responsible for finance BDO Sp. z o.o. 2

6 During the audited period and until the audit was concluded, the Management Board composition did not change. 2. Composition of the Group The separate financial statements of the Parent for the financial year ending 31 December 2015 were audited by BDO Sp. z o.o., with an unqualified opinion. Data of related parties whose financial statements were audited by the statutory auditor: Name of entity Entity authorised to audit Type of audit opinion Consolidation method Koelner Tworzywa Sztuczne Sp. z o.o. Koelner Rawlplug IP Sp. z o.o. Koelner Łańcucka Fabryka Śrub Sp. z o.o. BDO Sp. z o.o. Unqualified Full BDO Sp. z o.o. Unqualified Full BDO Sp. z o.o. Unqualified Full Koelner Polska Sp. z o.o. BDO Sp. z o.o. Unqualified, with explanation Full Fabryka Pił i Narzędzi Wapienica Sp. z o.o. Kancelaria Audytorska Dudek Unqualified Full Koelner CZ s.r.o. Moravskoslezsky Audit s.r.o. Unqualified Full Koelner Hungaria Kft ECOAUDIT 86 Kft Unqualified Full Rawlplug Ltd T B DUNN & Co Unqualified Full Rawlplug Middle East FZE Morison Menon Chartered Accountants Unqualified Full Rawl Scandinavia AB Deloitte AB Unqualified Full Rawlplug Ireland Ltd Niall B. Carberry & Co Unqualified Full Rawl France SAS CABINET SABATIER Unqualified Full Rawlplug Building & Construction Material Trading LLC Morison Menon Chartered Accountants Unqualified Full A detailed list of entities subject to consolidation (directly or indirectly) can be found under point of additional information to the annual consolidated financial statements. All of the consolidated entities had the same balance sheet date as the Parent. Changes in the Group's composition during 2015 are presented in point of additional information to the annual consolidated financial statements. BDO Sp. z o.o. 3

7 3. Data identifying the authorised entity and statutory auditor The audit of Rawlplug Group's consolidated financial statements for 2015 was carried out by BDO Sp. z o.o., based in Warsaw, ul. Postępu 12, an entity authorised to audit financial statements, entered onto the list of the National Chamber of Statutory Auditors in Poland under no The statutory auditor was selected by the Parent's Supervisory Board pursuant to written resolution 1 of 7 May The audit was carried out pursuant to an agreement of 24 June 2015, led by lead statutory auditor Beata Wójciak-Dziechciarz (register no ). The audit was carried out at the Parent's registered office and at subsidiaries, from 25 January 2016 to the date on which this opinion was issued, with breaks. It was preceded by a review of consolidated financial statements for the first half of We declare that BDO Sp. z o.o., its management board and statutory auditor along with the team auditing the financial statements meet the conditions to issue an impartial and independent opinion on the audited financial statements - in accordance with art. 56 sec. 3 and 4 of the Act on statutory auditors and their self-regulation, entities authorised to audit financial statements and on public supervision (Polish Journal of Laws of 2009, no. 77, item 649, as amended). The Parent's director provided all of the declarations requested by the statutory auditor as well as explanations and information necessary to perform the audit. The audit was not limited in scope in any way, and the statutory auditor was not restricted in selecting the appropriate audit methods. 4. Information on the consolidated financial statements for the preceding year The Group's consolidated financial statements for the period from 1 January to 31 December 2014 were audited by Grant Thornton Frąckowiak Sp. z o.o. Sp. k., an entity authorised to audit financial statements, no. 3654, and were issued an unqualified audit opinion with the following explanation: "The Group s consolidated balance sheet as at 31 December 2014 includes goodwill arising on acquisition of subsidiaries: Rawlplug Ltd., Rawlplug Ireland Ltd., Rawl France SAS, Stahl GmbH, Koelner Ltd. And Koelner Hungary Kft, amounting to a total of PLN thousand. This goodwill arising on consolidation was tested for impairment by the Parent s Management Board as at 31 December 2014, based on expected future cash flows at these companies. The test did not indicate a need to recognise impairment losses on these assets. The basic assumptions used in the tests are presented in Note 53 to Koelner Group s consolidated financial statements for The Parent s Management Board believes that achieving the subsidiaries budgets is possible. We note, however, that the expected future cash flows depend on future events, which are not certain and are beyond the control of the subsidiaries management boards." The Group's consolidated financial statements for the period from 1 January to 31 December 2014 were approved through resolution no. 5 of the Ordinary General Meeting of 26 June The Group's consolidated financial statements for 2014 were filed with the National Court Register on 3 July II. FINANCIAL ANALYSIS OF THE GROUP Presented below are selected figures from the consolidated statement of financial position, consolidated statement of profit and loss, consolidated statement of comprehensive income, as well as key financial ratios, in comparison with the previous years. BDO Sp. z o.o. 4

8 1. Key figures from the consolidated statement of financial position, consolidated statement of profit and loss and consolidated statement of comprehensive income (in PLN 000s) % of balance sheet total % of balance sheet total Non-current assets Current assets Total assets Equity Liabilities and liability provisions TOTAL EQUITY AND LIABILITIES % of revenue % of revenue Revenue from sales Cost of sales ( ) (68.7) ( ) (70.1) ( ) Selling costs and administrative expenses ( ) (25.1) ( ) (25.2) ( ) Result on sales Result on other operating revenues and costs (1 974) (0.3) (5 399) (0.8) Result on financing activities Gross result on financing activities (10 467) (1.6) 4.3 (9 931) (1.6) 2.3 (14 150) Income tax Net result on financing activities (3 851) (0.6) (2 765) Profit attributable to noncontrolling interests Profit attributable to shareholders of the parent BDO Sp. z o.o. 5

9 2. Key financial ratios Profitability ratios Gross sales margin 31.3% 29.9% 31.0% Net sales margin 3.8% 2.8% 2.1% Return on assets 3.2% 2.3% 1.7% Liquidity ratios Liquidity ratio I Liquidity ratio II Turnover ratios Receivables turnover days Debt ratios Payables turnover days Debt ratios 50.4% 52.1% 51.1% 3. Commentary The Group's balance sheet total on 31 December 2015 was PLN thousand, and grew by PLN thousand, i.e. 1%, from the previous year. Revenue from sales reached PLN thousand in 2015, up by PLN thousand, i.e. 5%, from the previous year. Cost of sales in 2015 was PLN thousand, down from the previous year by PLN thousand, i.e. 3%. Result on sales was PLN thousand, and was adjusted for a negative balance of other operating activities of PLN thousand and a negative result on financing activities of PLN thousand. The Group generated PLN thousand in net profit in 2015, up by PLN thousand, i.e. 39%, from the previous year. Gross sales margin, net sales margin and return on assets were higher y/y: 6.2%, 3.8% and 3.2%. Receivables turnover increased in 2015 by one day, while payables turnover shortened by four days. Liquidity ratio grew to 1.4 as of 31 December During the audit of the financial statements, we did not identify anything indicating that, should the Parent cease or substantially limit its existing operations, it would no longer be able to continue operating over at least the next reporting period. BDO Sp. z o.o. 6

10 III. DETAILED PART OF THE REPORT 1. Basis for preparing the consolidated financial statements Rawlplug Group's consolidated financial statements were prepared in accordance with International Financial Reporting Standards as approved by the European Union. 2. Completeness and correctness of consolidation documentation Consolidation documentation was prepared in accordance with the requirement of the Ordinance of the Minister of Finance dated 25 September 2009 on detailed rules for preparing consolidated financial statements by entities other thank banks, insurance companies and reinsurance companies (Polish Journal of Laws of 2009, no. 169, item 1327). During the audit, we did not identify any errors in consolidation documentation that could have material impact on the audited consolidated financial statements and that were not subsequently removed, including as regards compliance with conditions that such consolidation documentation should meet. 3. Rules and methods of valuation for assets, liabilities and equity Entities included in the Group's consolidated financial statements apply harmonised accounting principles and valuation methods for specific items of assets, liabilities and equity. 4. Description of the components of the consolidated financial statements The structure of the Group's assets, liabilities and equity is presented in the consolidated financial statements for the financial year ended 31 December Data presented in the Group's consolidated financial statements is in compliance with the consolidation documentation. 5. Additional information and explanations Information contained in additional information and explanations to the consolidated financial statements, including a description of the significant accounting principles and other explanatory information, is presented completely and accurately in all significant respects. 6. Declaration of the parent's management The Parent's management submitted a written declaration to the effect that all data is fully recognised in the consolidated financial statements, as are contingent liabilities and significant events that took place after the balance sheet date. BDO Sp. z o.o. 7

11 7. Report on Group operations The management report on the Group's operations for the financial year ended 31 December 2015 is complete in the meaning of art. 49 sec. 2 of the Accounting Act and takes into considerations the provisions of the Ordinance of the Minister of Finance of February, on current and periodic information disclosed by issuers of securities and the terms for recognising as equivalent information required by the laws of a non-member state, and the information contained therein, derived from the audited consolidated financial statements, is compatible with the report. Poznań, 17 March 2016 BDO Sp. z o.o. ul. Postępu Warsaw Entity authorised to audit financial statements no Lead statutory auditor conducting the audit: Acting on behalf of BDO Sp. z o.o.: Beata Wójciak-Dziechciarz Statutory Auditor no dr André Helin President of the Management Board Statutory Auditor register number BDO Sp. z o.o. 8