CONSOLIDATED ANNUAL FINANCIAL REPORT
31 DECEMBER 2021
Registered office in Milan, Viale Abruzzi, 94
Tax Code Company Reg. No. 08851780968
Registered in the Companies Register of Milan
R.E.A. No. 2053323
www.italianwinebrands.it
Table of contentent
Composition of Administrative and Supervisory bodies 3
Letter to Shareholders 4
Directors’Report on Operations 5
Consolidated Annual Financial Reports
Consolidated Statement of Financial Position 37
Comprehensive Income Statement 38
Statement of changes in Shareholders’ Equity 39
Statement of Cash Flows 40
Form and contents of the Consolidated Financial Report 41
Notes to the Financial Statement 66
These separate and consolidated financial statements constitute a non-official version and they are not compliant
with the provisions of Commission Delegated Regulation (EU) 2019/815.
3 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
3 |
Composition of Corporate Bodies
Board of DIrectors
Alessandro Mutinelli (Chief Executive Officer and Chairman)
Giorgio Pizzolo (Deputy Chairman)
Pier Paolo Quaranta (Director with delegated powers)
Simone Strocchi
Marta Pizzolo
Massimiliano Mutinelli
Antonella Lillo (Indipendent Director)
Board of Statutory Auditors
David Reali (Chairman of the Board of Statutory Auditors)
Debora Mazzaccherini (Statutory Auditor)
Eugenio Romita (Statutory Auditor)
Indipendent Auditors
BDO Italia S.p.A.
Nomad
Intesa Sanpaolo S.p.A.
Letter to shareholders
Dear Shareholders,
2021 has been a fundamental year in the development of your company: thanks to the
acquisition of Enoitalia SpA, completed in July of this year, Italian Wine Brands has become
the first Italian non-cooperative wine producer for size, reaching the target declared at the
time of listing on the Stock Exchange at the beginning of 2015.
The growth project on international markets also continued with the signing of the
agreements, in December 2021, relating to the acquisition of the US company Enovation
Brands Inc. This acquisition, which will be completed by the end of April, will allow IWB to be
present in America with its own strong and widespread commercial structure, with distinctive
proprietary brands. The American market is, to date, the most important outlet for Italian wine
abroad with excellent growth fundamentals in the medium to long term.
The positive management of 2021 resulted in the achievement of important economic and
financial results: on a pro-forma basis, the consolidated turnover settled at Euro 408.9 million
while the pro-forma Ebitda reached Euro 41.8 million. From a financial point of view, IWB is
balanced, with a leverage ratio (Net Financial Position / pro-forma Ebitda) of 2.6x and a debt
duration of over 5 years.
The effort made in these 6 years on Stock market therefore allows us now to be stronger in
facing a very challenging 2022 from the point of view of the cost of production factors and
procurement of supplies.
The results obtained are the starting point of a further development path, which will see the
IWB group focus further on the enhancement of the brands in its portfolio and on the
development of high added value products, through innovation and creative thinking
combined with pragmatism and organizational efficiency.
Thanks to our principles, we have built in the past and will continue to do so in the future, the
value of the IWB group, a value recognized by our customers, our suppliers, our employees
and, last but not least, the capital market, both equity and debt.
Alessandro Mutinelli
Chairman and CEO
5 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
5 |
Directors' Report on Operations
1. Analysis of the Company's situation, performance and operating results
1.1. Reference market in which the company operates
In terms of its target markets, IWB's business is predominantly and increasingly achieved with
foreign customers, also thanks to Enoitalia S.p.A acquisition finalized on July 2021, and only
the remaining part with domestic customers.
Sales are made exclusively through a portfolio of proprietary and registered brands. In
particular, the group operates under the various brands:
7 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
7 |
With centralised governance functions (finance & IT, marketing, production and quality, and
purchasing), the IWB Group is unique because it has three different sales and distribution
channels.
x the "wholesale" channel for the sale of products to operators in the sector, such as
large-scale distribution chains, state monopolies and traditional trade,
x the "distance selling" channel for direct sales of products in the portfolio to private
consumers.
x the Ho.re.ca channel aimed at the sale to hotels, restaurants and catering in which the
IWB group is active, thanks to the acquisition of Enoitalia S.p.A, in particular in the US
market and in UK.
The three distribution channels also rely on a centralised production structure consisting of (i)
5 owed and one rented cellars in Diano d'Alba (CN), Torricella (TA), Calmasino (VR) and
Montebello (VI) and nine bottling lines owned by the Group and located as follow: two in
Diano d'Alba (CN) three in Montebello (VI) and four in Calmasino (VR)
From a corporate point of view, IWB S.p.A. carries out management activities for Group
companies as well as management and coordination activities, directly holding controlling
interests in the main Group companies: Giordano Vini S.p.A. and Provinco Italia S.p.A. The
corporate organization chart of the Italian Wine Brands group is provided below, also following
the aforementioned acquisition of Enoitalia S.p.A. and its subsidiaries.
1.2.1 Consolidated situation
The main comments on the reclassified Statement of Financial Position and Income Statement
presented at the end of this section are provided below. The consolidated Annual Report of
the Group, between 2019 and 2021, shows the following results, expressed in millions of €.
The economic results of Enoitialia SpA are consolidated starting from the acquisition and
therefore limited to the second half of 2021. The pro-forma income statement is aimed at
providing the economic representation of the IWB Group following the acquisition.
1
Pro-forma consolidated figures relating to all companies of the group perimeter for the period 1 January 2021 – 31 December 2021.
2
The restated accounting data at 31/12/2021 (restated EBITDA and restated Profit/(Loss) for the Period) are shown gross of non-recurring cost, as
detailed on page 11.
31.12.2021
pro-forma
(1)
31.12.2021 31.12.2020 31.12.2019
Revenue from sales
408.934 313.227 204.311
157.494
Change in inventories
19.524 13.333 4.780
1.329
Other income
2.953 2.645 1.538
1.220
Total revenues
431.411 329.205 210.629
160.043
Purchase costs
(295.527) (217.705) (123.650)
(92.547)
Costs for services
(72.362) (62.009) (52.159)
(41.486)
Personnel costs
(20.492) (14.563) (8.125)
(7.441)
Other operating costs
(1.200) (898) (1.091)
(482)
Total operating costs
(389.581) (295.175) (185.025)
(141.956)
Restated EBITDA
41.830 34.030 25.604
18.087
EBITDA
38.809 31.009 23.604
16.304
Restated net profit/(loss)
20.464 16.716 15.634
9.185
Net profit/(loss)
18.286 14.538 14.192
7.899
Net financial debt
121.256 121.256 10.332
10.683
of which net financial debt - third-party
lenders
107.977 107.977 (1.437)
(565)
of which net financial debt - deferred price
acquisition of Raphael Dal Bo AG
0 0 1.861
0
of which net financial debt - right-of-
use liabilities
13.279 13.279 9.908
11.248
9 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
9 |
The reclassified consolidated statement of financial position and income statement are shown
below.
Reclassified statement of financial position
€thousand
31.12.2021 31.12.2020 31.12.2019
Other intangible assets 35.983 34.005 32.474
Goodwill 181.085 68.309 55.455
Tangible assets 50.124 15.104 14.539
Right-of-use assets 14.042 9.637 10.860
Equity investments 3 2 2
Total Fixed Assets 281.237 127.057 113.330
Inventory 77.908 25.490 20.334
Net trade receivables 68.144 30.567 23.605
Trade Payables (137.367) (56.809) (45.750)
Other assets (liabilities) 1.286 (2.541) (1.731)
Net working capital 9.971 (3.293) (3.542)
Payables for employee benefits (1.212) (621) (651)
Net deferred and prepaid tax assets (liabiliies) (8.451) (8.028) (8.252)
Other provisions (334) (261) (994)
NET INVESTED CAPITAL 281.211 114.854 99.891
Shareholders' equity 159.955 104.521 89.208
Profit (loss) for the period 14.538 14.193 7.899
Share capital 1.046 880 880
Other reserves 144.371 89.448 80.429
Net Financial position 107.977 (1.437) (565)
Deferred price acquisition Raphael Dal Bo AG - 1.861 -
Right of use liabilities 13.279 9.908 11.248
TOTAL SOURCES 281.211 114.854 99.891
Reclassified Income stetement
€thousand
Restated Restated Restated Restated
31.12.2021
pro-forma
31.12.2021 31.12.2020 31.12.2019
Revenue from sales
408.934 313.227 204.311
157.494
Change in inventories
19.524 13.333 4.780
1.329
Other income
2.953 2.645 1.538
1.220
Total revenues
431.411 329.205 210.629
160.043
Purchase costs
(295.527) (217.705) (123.650)
(92.547)
Costs for services
(72.362) (62.009) (52.159)
(41.486)
Personnel costs
(20.492) (14.563) (8.125)
(7.441)
Other operating costs
(1.200) (898) (1.091)
(482)
Total operating costs
(389.581) (295.175) (185.025)
(141.956)
EBITDA
41.830 34.030 25.604
18.087
Write-ups / (Write-downs)
(1.212) (1.152) (1.427)
(1.233)
Amortization and depretiation
(9.264) (6.948) (3.960)
(3.349)
Operating result from core business
31.354 25.930 20.217
13.505
Exceptional items
(3.021) (3.021) (2.000)
(1.783)
Net releases (accruals) for provision risks and charges
- - -
0
EBIT
28.333 22.909 18.217
11.722
Net Finance revenues (costs)
(4.308) (3.938) (1.186)
(1.223)
EBT
24.025 18.971 17.031
10.499
Taxes
(5.739) (4.433) (2.839)
(2.600)
Net Result
18.286 14.538 14.192
7.899
Tax effect of exceptional charges
843 843 558
497
Net profit before exceptional items and
related tax effect
20.464 16.716 15.634 9.185
11 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
11 |
Summary of Management Adjustments
1. Other Revenues equal to Euro 22 thousands relating to the reimbursement of legal expenses for litigation with a former
commercial agent.
Euro 917 thousands of Cost for Services related to: a) Euro 725k Enoitalia S.p.A. acquisition (Euro 301k for Tobin Tax, Euro
272k for legal and notary advice, Euro 152 k for financial advisory and due diligence), b) Euro 192 k legal advice related to
litigation with a former commercial agent and conciliations with ex-employees.
Euro 262 thousands of Personnel Costs for personnel redundancy;
Euro 116 thousands of Other Costs for VAT levy
2. Costs for Services and Personnel, respectively €1,283 thousand for Services and €465 thousand for Personnel related to the
accrual and allocation of the second tranche of the 2020-2022 Stock Grant Plan, representing 18,75% of the total value of
the plan itself and in line with the achievement of the mean profitability targets and control of the net financial position
during the period 2020-2022. In particular, the Pro-Forma Restated EBITDA target for the first year is €41.0m and the NFP
to Restated EBITDA target ratio at 31 December 2021 is less than 3.0x.
The interim profitability index called by the directors "Restated EBITDA,” compared to the "Net
Profit" shown in the consolidated comprehensive income statement, is made up as follows:
Reclassified Income stetement
€thousand
Reported
Management adjustments Restated
31.12.2021 1 2 31.12.2021
Revenue from sales
408.934
408.934
Change in inventories
19.524
19.524
Other income
2.975 (22)
2.953
Total revenues
431.433 (22)
431.411
#RIF!
Purchase costs
(295.527)
(295.527)
Costs for services
(74.562) 917 1.283
(72.362)
Personnel costs
(21.219) 262 465
(20.492)
Total operating costs
(1.316) 116
(1.200)
Total operating costs
(392.624) 1.295 1.748
(389.581)
EBITDA
38.809 1.273 1.748
41.830
ì
Write-ups / (Write-downs)
(1.212) (1.212)
Amortization and depretiation
(9.264) (9.264)
Operating result from core business
28.333 1.273 1.748 31.354
Exceptional items
-
(1.273) (1.748) (3.021)
Net releases (accruals) for provision risks and charges
- -
EBIT
28.333 0 0 28.333
Net Finance revenues (costs)
(4.308) (4.308)
EBT
24.025 0 0 24.025
Taxes
(5.739) (5.739)
Net Result
18.286 0 0 18.286
Tax effect of exceptional charges
843
Net profit before exceptional items and related tax effect
20.464
Net income less "Taxes", "Net financial income and charges", “Write-ups/(Write-downs)"
including the write-down of inventories and trade receivables, "Provisions for risks" and
“Amortisation and Depreciation," also after deducting non-recurring charges and income and
costs related to the medium/long-term management incentive plan.
1.2.2 Financial and equity position of the Parent Company
The financial statement of IWB S.p.A. at 31 December 2021 shows:
x A Net Profit for the period of € 9,8 million (€ 7,8 million at 31 December 2020);
x Net financial position of €72,5 million (€30,1million positive at 31 December 2020).
The increase is explained by the acquisition of Enoitalia S.p.A.
Below is a summary of the parent company's statement of financial position, financial position
and income statement.
Reclassified statement of financial position
€thousand
31.12.2021 31.12.2020 31.12.2019
Other intangible assets 196 224 194
Right-of-use assets 179 238 298
Tangible assets 122 143 163
Investment in subsidiaries 205.481 54.256 54.256
Total Fixed Assets 205.978 54.861 54.911
Net trade receivables 2.282 112 1.267
Trade Payables (211) (121) (328)
Other assets (liabilities) 4.821 4.354 2.958
Net working capital 6.892 4.345 3.897
Payables for employee benefits (37) (24) -
Net deferred and prepaid tax assets (liabiliies) - - -
Other provisions
- - -
NET INVESTED CAPITAL 212.833 59.183 58.808
Shareholders' equity 140.266 89.264 80.268
Profit (loss) for the period 9.780 7.799 6.388
Share capital 1.046 880 880
Other reserves 129.440 80.585 73.000
Net Financial position 72.567 (30.082) (21.460)
TOTAL SOURCES 212.833 59.183 58.808
13 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
13 |
In relation to the above statement of financial position, it should be noted that:
- The equity investments in subsidiary companies consist of Giordano Vini S.p.A. for
€32,823 thousand, Provinco Italia S.p.A. for €21,433 thousand and Enoitalia
151.225thousand (including acquisition costs)
- current and non-current financial assets are represented by receivables / loans from
subsidiaries.
In relation to the situation described above in the income statement:
- dividends refer entirely to the subsidiary Provinco Italia S.p.A.;
- costs for services and personnel costs include respectively € 794 thousand and € 289
thousand of fees relating to the assignment of stock grants relating to the 2020-2022 plan;
- financial income refers to interest income accrued on the loan granted to the
subsidiaries Giordano Vini S.p.A. (equal to € 458 thousand), Enoitalia Sp.A. (equal to Euro
27 thousand) and Provinco SpA (equal to Euro 27 thousand) and to interest income
accrued on current accounts and liquidity deposit accounts (Euro 2 thousand); financial
charges are mainly represented by interest expense relating to the bond loan equal to €
2,205 thousand.
Reclassified Income statement
€thousand
31.12.2021 31.12.2020 31.12.2019
Revenue from sales
1.369 800
200
Other income
72 57
39
Total revenues
1.441 857
239
Purchase costs
(16) (1)
(5)
Costs for services
(1.773) (1.465)
(1.224)
Personnel costs
(1.017) (796)
(256)
Total operating costs
(214) (462)
(88)
Total operating costs
(3.020) (2.725)
(1.573)
EBITDA
(1.579) (1.868)
(1.334)
Write-ups / (Write-downs)
- -
-
Amortization and depretiation
(170) (162)
(56)
Operating result from core business
(1.749) (2.030)
(1.390)
Net releases (accruals) for provision risks and charges
- -
-
EBIT
(1.749) (2.030)
(1.390)
Net Finance revenues (costs)
(1.859) 182
189
Dividends
12.402 9.152
7.355
EBT
8.794 7.303
6.154
Taxes
986 496
234
Net Result
9.780 7.799
6.388
Tax effect of exceptional charges
302 -
-
Net profit before exceptional items and related tax effect
10.082 7.799
6.388
1.2.3 Consolidated Net Financial Position
The details of the net financial debt as at 31 December 2021 as at 31 December 2020 and as
at 31 December 2019 are provided below, set out on the basis of the new scheme provided
for by the ESMA guideline 32-382-1138 of 4 March 2021.
€thousand
31.12.2021 31.12.2020 31.12.2019
A. Cash
438 340
720
B. Cash equivalents
58.666 33.062
31.933
C. Other current financial activities
1.113 57
111
D. Liquidity (A) + (B) + (C)
60.217 33.459
32.764
E. Current financial debt (included financial instruments but not included
current part of non current financial debt)
31.963 4.565
3.561
F. Current part of non current financial debt
2.894 6.599
5.010
G. Current financial debt (E) + (F)
34.857 11.164
8.571
H. Net current financial debt (G) - (D)
(25.360) (22.295)
(24.193)
I. Non current financial debt (excluded current part and financial
instruments)
4.931 23.807
24.967
J. Financial instruments
130.795 -
-
K. Trade payables and other non current debts/right of use
10.891 8.821
9.909
L. Non current financial debt (I) + (J) + (K)
146.617 32.628
34.876
M. Net financial position (H) + (L)
121.256 10.332
10.683
of which
Deferred price aquisition Raphael Dal Bo AG
- 1.861
-
Current payables for the acquisition of right of use
2.388 1.088
1.339
Non Current payables for the acquisition of right of use
10.891 8.821
9.909
Net financial position withot the effect of IFRS 16 IFRS 16 and deferred pr
107.978 (1.437) (565)
15 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
15 |
1.3 Group Performance
Business volume – Revenues
Italian Wine Brands is the first Italian non-cooperative wine group by reaching, on a
consolidated annual pro-forma basis, Euro 408.9 million in turnover and therefore recording a
substantial doubling in turnover compared to 2020. The main contribution to the growth is
linked to the acquisition of Enoitalia SpA (turnover in 2021 equal to Euro 208.4 million),
finalized in July 2021.
The trend in revenues is characterized both by the further strengthening of the Group on
international markets, where sales revenues of approximately Euro 332.3 million were
achieved (+ 102.55% compared to 2020), and by a greater presence on the domestic market,
with sales revenues of approximately Euro 75.7 million (+ 91.4% compared to 2020).
Pro-forma consolidated figures relating to all companies of the group perimeter for the period 1 January 2021 – 31
December 2021 have been indicated In the table above and in the following ones (31.12.2021 pro-forma), in the
same way, the deviations are calculated with reference to the pro-forma 31.12.21 figure (∆ % 20/21 - Cagr 19/21).
Amounts in €thousand
31.12.2021
pro-forma
31.12.2021 31.12.2020 31.12.2019 ∆ % 20/21 Cagr 19/21
Revenues from sales - Italy 75.681 57.597 39.539 33.333 91,41% 50,68%
Revenues from sales - International Markets 332.342 254.719 164.080 123.543 102,55% 64,01%
UK 98.048 66.447 24.254 17.262 304,26% 138,33%
Gemany 61.568 51.863 41.961 35.298 46,73% 32,07%
Swiss 49.076 48.154 48.814 27.572 0,54% 33,41%
US 19.252 10.430 1.561 3.018 1133,57% 152,57%
Austria 17.833 17.764 18.493 14.589 (3,57%) 10,56%
France 13.259 9.020 5.760 5.087 130,20% 61,45%
Belgium 10.013 9.190 6.641 4.039 50,78% 57,44%
Netherland 9.912 6.597 1.709 960 480,15% 221,37%
Poland 9.417 6.040 1.086 1.038 767,30% 201,26%
Denmark 7.535 6.004 5.020 5.177 50,10% 20,65%
Ireland 6.847 4.512 1.516 1.008 351,57% 160,69%
Canda 4.654 2.446 877 617 430,88% 174,67%
Sweden 2.260 1.681 1.586 1.324 42,47% 30,63%
Hungary 1.869 1.666 1.544 1.312 21,04% 19,35%
China 1.616 1.225 882 1.264 83,15% 13,04%
Other Countries 19.184 11.681 2.378 3.979 706,84% 119,57%
Other revenues 910 910 692 617 31,49% 21,46%
Total revenues from sales 408.934 313.227 204.311 157.494 100,15% 61,14%
The table shows how the acquisition of Enoitalia has ensured greater geographical
diversification of revenues, contributing to the strengthening of the group in key countries
such as the United States (+ 1,133.6% growth compared to the previous year), Germany (+
46.7%) and England (+ 304.3%) respectively first and second destination market for Italian wine
abroad.
The group's exposure to sales made in the Russian Federation is very limited, totaling
approximately Euro 2.0 million in 2021, already almost completely collected by IWB before the
outbreak of the war in Ukraine.
The breakdown of sales revenues by distribution channels highlights a marked strengthening
of the wholesale sector (sale to large-scale retail chains, state monopolies), an important
strength in the distance selling channel (direct sales to individuals) thanks to the resilience of
the business model e-commerce and traditional even in the post-pandemic phase, both in Italy
and abroad. In addition to this, thanks to the acquisition of Enoitalia S.p.A., the IWB group is
now also active in the Ho.re.ca. channel. (hotel, restaurant and catering) mainly in UK and the
United States and to a lesser extent in other countries.
The breakdown of revenues by business area is shown below.
Wholesale revenues have recorded a very sustained development over the last 3 years, going from Euro
87.7 million in 2019 to Euro 299.4 million in 2021. The growth is attributable both to i) organic
development, Euro 17.4 million, thanks to the growth of the group's proprietary brands and ii) the
acquisition of companies operating in the wine sector, Euro 194.3 million. In particular, the acquisition
of Enoitalia contributed for Euro 182.4 million in 2021 and the acquisition of Raphael Dal Bo AG
contributed for Euro 11.9 million in 2020. Thanks to this significantly higher growth compared to that
recorded by the market in the same period (see tables above), the wholesale distribution channel is by
far the main contributor to the group's revenues, accounting for 73.2% of total sales revenues in 2021
(58.6 % in 2020, 55.7% in 2019).
Amounts in €thousand
31.12.2021
pro-forma
31.12.2021 31.12.2020 31.12.2019 ∆ % 20/21 Cagr 19/21
Total Revenues from Sales 408.934 313.227 204.311 157.494 100,15% 61,14%
Revenues from wholesale division 299.379 212.078 119.629 87.654 150,26% 84,81%
Revenues from distance selling division 82.706 82.671 83.990 69.223 (1,53%) 9,31%
Revenues from ho.re.ca division 25.938 17.567 NA NA
Other Revenues 910 910 692 617 31,49% 21,46%
17 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
17 |
The breakdown of the sales revenues of the wholesale channel by country is provided below:
In the countries in which it operates through the wholesale channel, IWB has managed to obtain growth
rates much higher than those expressed by the reference market, combining organic growth with
targeted M&A operations. These results were mainly obtained thanks to:
- - a renewal, expansion, extension and enrichment of the range of its own brand product
portfolio, which make the commercial offer of the IWB Group attractive, recognized on the
market and synonymous with quality;
- - the increase in the market share of sales on existing accounts thanks to excellent rotation
parameters of the shelf of its customers;
- - the acquisition of new accounts, carried out substantially in every single country in which the
Group operates.
The distance selling division, after the strong growth recorded in 2020, managed to substantially
maintain volumes and increase margins during 2021 thanks to the consolidation of the expansion
strategy on digital channels and the focus on foreign countries.
The sales revenues of the distance selling division are shown below, broken down by country:
31.12.2021
pro-forma
31.12.2021 31.12.2020 31.12.2019 ∆ % 20/21 Cagr 19/21
Revenues from sales - Italy 42.607 24.655 5.524 3.645 671,34% 241,91%
Revenues from sales - International Markets 256.772 187.423 114.106 84.009 125,03% 74,83%
UK 72.470 44.625 14.703 13.206 392,88% 134,26%
Swiss
45.486 44.586 45.117 24.279 0,82% 36,88%
Gemany 32.615 23.334 14.833 11.123 119,88% 71,24%
US 15.379 8.628 1.561 3.018 885,45% 125,75%
Austria 15.149 15.082 15.856 12.346 (4,46%) 10,77%
Belgium 9.354 8.552 5.997 3.674 55,97% 59,57%
Netherland 9.176 5.892 1.093 542 739,36% 311,33%
Poland 8.841 5.710 1.086 1.038 714,27% 191,91%
France 7.749 3.545 165 103 4590,92% 767,39%
Denmark 7.513 5.995 5.020 5.177 49,66% 20,47%
Ireland 6.707 4.377 1.516 1.008 342,32% 158,01%
Canda 3.085 1.774 877 617 251,87% 123,62%
Sweden 2.222 1.656 1.586 1.324 40,10% 29,54%
Hungary 1.866 1.665 1.544 1.312 20,86% 19,26%
China 1.565 1.185 882 1.264 77,42% 11,26%
Other Countries 17.593 10.816 2.269 3.979 675,51% 110,27%
Total revenues from sales 299.379 212.078 119.629 87.654 150,26% 84,81%
In more specific terms, in 2021 distance selling saw a growth in revenues of 19 % compared to
2019, achieved in particular thanks to the development of digital platforms which came to
represent 26.8% of the division's overall sales.
These positive results are the result of the strategy undertaken since the beginning of 2017 and
aimed at the progressive shift of outbound telephone sales towards the conversion of orders
on digital channels. This strategy was implemented through the various joint actions listed
below:
i) substantial investments in technological infrastructure;
ii) development of digital communication;
iii) focus and improvement on the quality of the wine product;
iv) optimization of integrated logistics processes;
v) acquisition of multi-brand platforms (www.svinando.com).
The above actions have made it possible to fully grasp the generalized development of online
sales during the current year as well as to progressively and significantly improve the
redemption and conversion parameters of the entire customer database which are now in line
with those of the main online operators in the wine sector.
The table below shows the evidence of the revenues of the distance selling division broken
down by sales channel.
Amounts in €thousand
31.12.2021
pro-forma
31.12.2021 31.12.2020 31.12.2019 ∆ % 20/21 Cagr 19/21
Distance Selling Revenues from sales - Italy 32.794 32.760 34.016 29.688 (3,59%) 5,10%
Distence Selling Revenues from sales - International Markets 49.912 49.912 49.974 39.535 (0,12%) 12,36%
Germany 27.987 27.987 27.128 24.176 3,17% 7,59%
UK 9.058 9.058 9.550 4.056 (5,15%) 49,45%
France 5.409 5.409 5.594 4.984 (3,31%) 4,18%
Swiss 3.552 3.552 3.697 3.293 (3,92%) 3,86%
Austria 2.678 2.678 2.637 2.243 1,57% 9,26%
Belgium 604 604 644 366 (6,12%) 28,53%
Netherland 583 583 615 417 (5,19%) 18,22%
Other Countries 39 39 109 0 (63,81%) NA
Distance Selling Total Revenues from Sales 82.706 82.671 83.990 69.223 (1,53%) 9,31%
19 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
19 |
2021, with the acquisition of Enoitalia SpA, also marks the Group's entry into the Ho.re.ca. channel
which constitutes an essential completion of the channel portfolio within the Group and which will allow
a significant improvement in the coverage of the customer base in the different consumption occasions.
Revenues 2021 indicate the first signs of recovery in conjunction with the overcoming of the period of
the Covid-19 pandemic.
Amounts in €thousand
31.12.2021
pro-forma
31.12.2021 31.12.2020 31.12.2019 ∆ % 20/21 Cagr 19/21
Revenues Distance Selling division - Italy 32.794 32.760 34.016 29.688 (3,59%) 5,10%
Direct Mailing 15.441 15.441 16.107 14.067 (4,14%) 4,77%
Teleselling 9.990 9.990 9.816 11.294 1,78% (5,95%)
Digital / WEB 7.363 7.328 8.092 4.327 (9,01%) 30,45%
% Direct Mailing on total Italy 47,1% 47,1% 47,4% 47,4%
%Teleselling on total Italy 30,5% 30,5% 28,9% 38,0%
% Digital / WEB on total Italy 22,5% 22,4% 23,8% 14,6%
Revenues - Distance selling division - International market 49.912 49.912 49.974 39.535 (0,12%) 12,36%
Direct Mailing 28.261 28.261 27.068 23.306 4,41% 10,12%
Teleselling 6.816 6.816 7.686 7.163 (11,32%) (2,45%)
Digital / WEB 14.835 14.835 15.220 9.066 (2,53%) 27,92%
% Direct Mailing on total International revenues 56,6% 56,6% 54,2% 59,0%
%Teleselling on total International revenues 13,7% 13,7% 15,4% 18,1%
% Digital / WEB on total International revenues 29,7% 29,7% 30,5% 22,9%
Distence selling division Total Revenues 82.706 82.671 83.990 69.223 (1,53%) 9,31%
Below is a breakdown of the sales revenues of the ho.re.ca channel by country:
England is confirmed as the first on-trade market for the Group thanks to the role of Enoitalia
S.p.A which has been operating in the segment for years with a wide range of wines. The nation
is in fact the second largest importer of wine in the world in terms of volumes and the first in
sparkling wines. Over the years, on-trade in the UK has reached over 40% of total wine sales
and Enoitalia has managed to achieve a dominant position in the Italian market share by
collaborating with the most important national groups. The recovery in consumption outside
the home, associated with the growing interest in Italian sparkling (in particular Prosecco DOC)
and a young consumer target interested in novelties and Italian style have supported the
recovery of the Group's sales during the year.
As far as the USA is concerned, the on-trade channel plays a double strategic role for the
Group: both of sales and of visibility for the historic brands (such as Voga Italia, Ca Montini)
which are also marketed in the wholesales channel. The recovery of the market was gradual
by virtue of the reopening of the individual states.
Canada has always been a nation close to the European style of consumption also in the
consumption away from home with a strong interest not only for sparkling wines, but also for
still wines. The market share that the Group has in this country, presided over by the historical
brands of Enoitalia, has facilitated the resumption of sales.
As for the smaller countries, there is an evident interest in the main European markets and in
particular in Germany and Poland where the share of Italian wine sold in the on-trade channel
has increased over the years.
Amounts in €thousand
31.12.2021
pro-forma
31.12.2021 31.12.2020 31.12.2019 ∆ % 20/21 Cagr 19/21
Ho.re.ca. Revenues from sales - Italy 280 183 0 0 NA NA
Ho.re.ca Revenues from sales - International Markets 25.658 17.384 0 0 NA NA
UK 16.520 12.764 0 0 NA NA
US
3.872 1.802 0 0 NA NA
Canada 1.569 672 0 0 NA NA
Gemany 966 542 0 0 NA NA
Poland 576 330 0 0 NA NA
Netherland 153 121 0 0 NA NA
Ireland 140 135 0 0 NA NA
France 100 65 0 0 NA NA
Belgium 55 34 0 0 NA NA
China 51 40 0 0 NA NA
Sweden 38 25 0 0 NA NA
Swiss 38 16 0 0 NA NA
Denmark 22 9 0 0 NA NA
Austria 7 3 0 0 NA NA
Hungary 3 1 0 0 NA NA
Other Countries 1.551 825 0 0 NA NA
Ho.re.ca Total revenues from sales 25.938 17.567 0 0 NA NA
21 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
21 |
Analysis of operating margins
The cost components which, deducted from the Total Revenues item, contributed to the formation of
the pro-forma Restated EBITDA of the Italian Wine Brands Group are detailed as follows:
More specifically, in 2021 the incidence of raw material consumption on revenues increased from 57.8%
to 67.0% due to the different "mix" of sales, increasingly shifted to the wholesale channel, characterized
structurally by a greater incidence of raw materials on sales compared the distance selling channel. At
the same time, and for the same reason, there has been a further reduction in the incidence of costs for
services on revenues from 25.3% to 17.6%. There is also a very slight increase in the incidence of
personnel costs (from 4.0% to 5.0%) due to the greater portion of internal production carried out by
Enoitalia compared to the historical perimeter of IWB's activity before the acquisition.
With regard to the operating margin of 2021, it should be noted that in the months of November and
December 2021 there were tensions on the purchase prices of the raw material, both of the "wine"
component (in particular Prosecco) and of the "dry materials" component which they had a negative
impact on the profit margins achieved between November and December towards large supermarkets
(revenues made on the basis of the 2021 price lists). These cost increases has been almost entirely
reversed on prices starting from 1 January 2022, thanks to the upward realignment of the sales price
lists.
Analysis of operating margins
Restated €thousand
31.12.2021
pro-forma
31.12.2021 31.12.2020 31.12.2019 ∆ % 20/21
Cagr 19/21
Revenues from sales and other revenues 411.887 315.872 205.849 158.714 100,09% 61,09%
Raw materials consumed (276.003) (204.372) (118.870) (91.218) 132,19% 73,95%
% of total revenues (67,01%) (64,70%) (57,75%) (57,47%)
Costs for services (72.362) (62.009) (52.159) (41.486) 38,73% 32,07%
% of total revenues (17,57%) (19,63%) (25,34%) (26,14%)
Personnel (20.492) (14.563) (8.125) (7.441) 152,21% 65,95%
% of total revenues (4,98%) (4,61%) (3,95%) (4,69%)
Other operating costs (1.200) (898) (1.091) (482) 9,99% 57,79%
% of total revenues (0,29%) (0,28%) (0,53%) (0,30%)
Restated EBITDA (*)
41.830 34.030 25.604 18.087 63,37% 52,08%
% of total revenues 10,16% 10,77% 12,44% 11,40%
Costs for Services, equal to Euro 72.3 million in the year, increased to absolute values of Euro 20.2 million
compared to 2020 but at the same time reduced their incidence on sales revenues (from 26.1% in 2019
to 25.3% in 2020 up to 17.6% in 2021).
The details of the costs for services incurred by the Group during the year 2021 are provided below,
compared with the same items in 2020 and 2019
The increase in costs for value-added services in 2021 compared to 2020 is entirely attributable
to the different scope of consolidation, while the further reduction in the incidence of costs
for services on sales revenues is linked i) to the "mix" of sales, again more oriented towards
the wholesale distribution channel, structurally characterized by a significantly lower incidence
of costs for services on revenues compared to sales made on the distance selling channel, and
ii) the increasing efficiency of the distance selling division.
Personnel costs recorded an increase in absolute values during the year from Euro 8.1 million
in 2020 to Euro 20.5 million in 2021 almost exclusively linked to the entry into the group of
Enoitalia S.p.A. The increase in the absolute value of personnel costs is also accompanied by a
slight increase in the percentage incidence on sales revenues (from 4.7% in 2019, to 4.0% in
Restated €thousand
31.12.2021
pro-forma
31.12.2021 31.12.2020
31.12.2019
Services from third parties
15.386 13.092 9.971
8.158
Duties and excise duties
8.646 8.282 8.374
3.451
Transport
19.448 17.174 14.935
11.871
Postage expenses
4.119 4.119 4.007
4.098
Fees and rents
1.085 1.001 717
447
Consulting
3.388 2.118 1.443
1.285
Advertising costs
1.299 1.098 259
286
Utilities
2.473 1.681 824
844
Remuneration of Directors, Statutory Aud
3.176 2.512 1.946 1.831
Maintenance 2.018 1.313 370 235
Costs for outsourcing 7.382 7.382 7.407 7.051
Commissions 1.677 898 141 121
Other costs for services 4.465 3.539 2.931 2.952
Non-recurring expenses (2.200) (2.200) (1.166) (1.144)
Total
72.362 62.009 52.159 41.486
23 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
23 |
2020 up to 5.0% in 2021) from ascribe to the higher percentage of wine production and
bottling carried out internally by Enoitalia. The internalization of these productions allows to
significantly reduce the costs for external processing and to increase the overall operating
margin.
The dynamics of revenues and costs described above made it possible to obtain a restated –
pro-formaGross Operating Margin of Euro 41.8 million in the year 2021 (10.2% of sales
revenues).
Below is a breakdown of the cost items that lead from the Gross Operating Margin to the pre-
tax income of the Italian Wine Brands Group.
From the table above, it emerges that the income statement of the Italian Wine Brands Group
was characterized in 2021 by an incidence of non-monetary items (write-downs, depreciation,
provisions), decreasing compared to previous years and for an overall incidence on turnover
equal to about 3.3%.
Non-recurring charges, equal to Euro 3 million (Euro 2 million in 2020), are attributable to:
- as for a total of Euro 1.3 million, to (i) costs for services related to legal consultancy
relating to the acquisition of Enoitalia by IWB S.p.A. (€ 917 thousand); (ii) charges
related to the transaction with a former employee of the subsidiary Giordano Vini
S.p.A. (Euro 262 thousand) and (iii) a VAT amendment of Euro 116 thousand
Restated €thousand
31.12.2021
pro-forma
31.12.2021 31.12.2020 31.12.2019 ∆ % 20/21
Cagr 19/21
Ebitda adjusted
41.830 34.030 25.604 18.087 63,37%
52,08%
Wrie downs
(1.212) (1.152) (1.427) (1.233) (15,07%)
(0,86%)
% of total revenues
(0,29%) (0,36%) (0,69%) (0,78%)
Depreciation and amotization
(9.264) (6.948) (3.960) (3.349) 133,94%
66,32%
% of total revenues
(2,25%) (2,20%) (1,92%) (2,11%)
Exceptional items
(3.021) (3.021) (2.000) (1.783) 51,04%
30,16%
% of total revenues
(0,73%) (0,96%) (0,97%) (1,12%)
Operating profit (loss)
28.333 22.909 18.217 11.722 55,53%
55,47%
% of total revenues
6,88% 7,25% 8,85% 7,39%
Financial income (expences)
(4.308) (3.938) (1.186) (1.223) 263,24%
87,68%
% of total revenues
(1,05%) (1,25%) (0,58%) (0,77%)
Net Result
24.025 18.971 17.031 10.499 28,85%
52,15%
% of total revenues
5,83% 6,01% 8,27% 6,62%
- € 1.7 million for the Costs for Services and Personnel Costs relating to the full accrual
and assignment of the first tranche of the 2020-2022 stock grant plan, the parameters
of which are described in detail in paragraph 1.2.1.
Financial Charges recorded a significant increase linked to the issue of the Bond Loan which
impacted financial charges for € 2.2 million
Investments in Capital Assets, Net Working Capital and Financial Position.
During the year under review there were investments in Fixed Capital equal to a total of Euro
7.2 million divided between tangible fixed assets (Euro 3.7 million, mainly investments for the
automation of production and sparkling wine production lines and for laboratory equipment)
and fixed assets intangible assets (Euro 3.5 million, mainly acquisitions of addresses and
customers for Euro 2.1 million, software developments for Euro 1.3 million and improvements
on third party assets for Euro 0.1 million).
The property complex located in Diano d'Alba and the six wineries of which five properties
located in Diano d'Alba, Torricella, Calmasino and Montebello as well as the bottling lines of
Diano d'Alba, Calmasino and Montebello represent a flower to the eyelet of the Italian wine
industry and are widely able to support, with adequate maintenance investments, the
production levels planned for the near future.
The Net Working Capital at 31 December 2021 increased compared to 31 December 2020
substantially due to the acquisition of Enoitalia which involves:
1) for the trade receivables and trade payables, an increase following the growth in
turnover;
2) and as regards the warehouse, the need to support the development of the 2022
business with the advance purchase of raw materials at more advantageous prices
than those recorded on the market in the last months of the year.
The dynamics described above of i) limited volumes of investments in fixed capital, ii) increase
in net working capital iii) substantial cash flows produced by operations, allowed the
improvement of the consolidated active cash position despite the investment for the
acquisition of Enoitalia SpA, the distribution of the dividend and the purchase of treasury
shares. In particular, the consolidated cash position increased from Euro 33.4 million at 31
December 2020 to Euro 59.1 million at 31 December 2021.
25 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
25 |
2 Significant events
2.1 2021 significant events
2.1.1 Bond
It should be noted that on May 13, 2021 Italian Wine Brands successfully placed on the market
its first Senior Unsecured Bond Loan for a total amount of Euro 130.0 million, maturing May
13, 2027, bullet repayment and a fixed interest rate at 2.5% per annum. The proceeds from
this bond issue were allocated i) to the repayment of existing credit lines (Euro 24.0 million)
which took place in June 2021 and ii) to the payment of a portion of the price relating to the
acquisition of 100% of the company Enoitalia SpA (Euro 105.0 million), completed on 27 July
2021 (as better explained in the following paragraph 2.2 Significant events that occurred after
the end of the half year - of this report).
2.1.2 Enoitalia S.p.A acquisition
On 27 July 2021, Italian Wine Brands S.p.A. finalised its investment transaction in Enoitalia
S.p.A. (the "Transaction") which provided for:
i. the acquisition of the entire share capital of the company (the "Acquisition") for a total
consideration of € 150,500,000.00;
ii. the reinvestment by Gruppo Pizzolo S.p.A., the holding company of Enoitalia S.p.A., in the
share capital of Italian Wine Brands S.p.A. for a total of € 45,500,000.00, through the
subscription of a reserved share capital increase. (the "Reserved Share Capital Increase").
This Reserved Share Capital Increase provided for the issuing of 1,400,000 ordinary shares
of Italian Wine Brands S.p.A., at a subscription price of EUR 32.50 per share.
Simultaneously to the closing of the Transaction, Chairman and CEO of the IWB Group,
Alessandro Mutinelli, through Provinco S.r.l., (a company wholly owned by him), and Gruppo
Pizzolo S.p.A., signed a 5-year shareholders' agreement covering 23.55% of IWB's share capital
and providing for the following main understandings reached between the parties:
i. appointment of the Board of Directors: the parties of the shareholders' agreement
undertook to vote, at the Shareholders' Meeting of IWB, with all shareholdings covered
by the agreement, in favour of the proposal submitted by Provinco S.r.l. in accordance with
the following:
a. (a) the majority of the members of the Board of Directors shall be appointed on the
recommendation of Provinco S.r.l.;
b. In the event that: (X) it is proposed that the Board of Directors of the Company be
composed of 7 members, 2 directors will be appointed by Gruppo Pizzolo, including the
Vice Chairman of the Board of Directors of IWB with proxies; and (Y) it is proposed that
the Board of Directors of the Company be composed of 9 members, 3 directors will be
appointed by Gruppo Pizzolo, including the Vice Chairman of the Board of Directors of IWB
with proxies and 1 director must meet the independence requirements provided by law;
ii. Direct lock-up: the 1,400,000 new ordinary shares of IWB resulting from the reserved
capital increase subscribed by Gruppo Pizzolo are subject to a lock-up restriction (subject
to specific exceptions to allow the transfer of these shares in compliance with legal or
regulatory obligations) for the purpose of stabilising the share price, for a period of 36
months from closing date of the Transaction;
iii. Indirect lock-up: also in order to allow the effective implementation of the project of
integration of the two industrial groups, the historical partners of Enoitalia have
undertaken not to transfer, in whole or in part, the shareholdings that they hold, directly
or indirectly, in the corporate vehicles that own the entire share capital of Gruppo Pizzolo
and to ensure that the aforementioned companies do not transfer, in whole or in part to
third parties the shareholding they hold in the Gruppo Pizzolo's share capital;
iv. standstill: for a period of 36 months from the closing date of the Transaction, Gruppo
Pizzolo and the historical shareholders of Enoitalia (directly or indirectly, and whether
acting alone or in concert with another person) have undertaken to: (i) not to buy or offer
to buy, or to cause or encourage any other related person to buy or offer to buy, IWB
shares (or IWB financial instruments of any other nature) and (ii) not to enter into any
contracts, agreements or understandings (including non-binding ones), including
shareholders' agreements, or to engage in any conduct that has the effect of acquiring an
interest, direct or indirect, in IWB shares (or IWB financial instruments of any other
nature);
v. tag-along: if one of the parties to the shareholders' agreement (in the case of Gruppo
Pizzolo, after the lock-up commitment has expired) intends to sell its entire shareholding
under the shareholders' agreement to a potential third party purchaserthe other party
will be entitled to sell, in turn, to the third party purchaser, in whole or in part, the shares
in the Company then held directly and indirectly under the same terms and conditions. In
the event of the exercise of the right of co-sale, if the third party does not intend to acquire
the shareholding of both shareholders, neither of them will be able to complete the
transfer of their shares.
vi. drag-along: in the event that Provinco S.r.l. intends to transfer to a third party all of its
shareholding that is the subject of the agreement, Provinco S.r.l. will have the right to
request Gruppo Pizzolo to transfer (and, in this case, Gruppo Pizzolo will have the
obligation to transfer) all of the IWB shares then held, directly and indirectly, in favour of
the third party purchaser.
27 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
27 |
Enoitalia is an Italian company operating in the production, bottling and marketing of wine in
five continents and over eighty countries and exports about 80% of its products. The main
reference markets are continental Europe, the UK and the United States, where Enoitalia
boasts a presence in both on and off trade channels; other markets, such as Asia, Australia,
Russia and the Middle East are instead served by a dedicated task force.
Enoitalia has a business model and a set of skills that are extremely complementary to those
of IWB and, for this reason, the Transaction represents a significant opportunity to integrate
the group headed by IWB with that headed by Enoitalia in order to create significant synergies,
both in terms of market positioning and product offering.
During the entire 2020 financial year, Enoitalia achieved sales revenues for a total of Euro 200.8
million, with an Ebitda of Euro 17.1 million and a net financial debt of Euro 1.1 million. These
accounting data can be inferred from the company's financial statements as at 31 December
2020, drawn up according to the OIC accounting principles.
During the first half of 2021, Enoitalia achieved revenues from sales for a total of Euro 97.3
million, with an Ebitda of Euro 7.2 million and a net financial debt of Euro 11.0 million. These
accounting data can be deduced from the half-year financial statements drawn up in
accordance with the OIC accounting principles and not subject to audit.
2.1.3 Agreements for the acquisition of 85% shareholding in Enovation Brands Inc
On 30 December 2021 Italian Wine Brands S.p.A. announced the signing of agreements for the
acquisition of 85% of the share capital of Enovation Brands Inc.
Enovation, based in Miami, is a long-standing importer of Italian wines into North America. It
is the owner of proprietary brands that are highly recognised in the US market (Voga®, among
the main ones) and it relies on a widespread distribution throughout the North American,
both in the supermarkets and ho.re.ca. channels.
From June 2020 to June 2021, Enovation achieved sales revenue of USD 32.2 million (with
82% of sales revenue generated in the US and 18% in Canada). In the same period, Enovation
achieved adjusted buyside Ebitda of USD 3.2 million, net accounting profit of USD 3.4 million.
The net financial position at 30 June 2021 was USD 0.1 million.
The brothers Giovanni and Alberto Pecora, co-founders and operating managers of the
company, hold 45% of Enovation share capital and Norina S.r.l., a financial company that is
owned by the four branches of the Pizzolo family (“Norina”) holds 55% of Enovation share
capital. More specifically, today, IWB signed two sale and purchase agreements with deferred
and conditional execution, which provide for IWB to acquire, directly or through a company
controlled by it, respectively
(i) Norina's entire 55% interest in the share capital of Enovation (the “Norina
Shareholding”); and
(ii) a shareholding in the share capital of Enovation, equal in total to 30% of the same,
owned by the Pecora brothers (the “Pecora Shareholding”).
Following the completion of the transaction, the share capital of Enovation will
therefore be held as follows:
(a) IWB will hold, directly or indirectly, an interest of 85% of the
relevant share capital; (b) Giovanni Pecora will hold an interest of 10% of the relevant share
capital; and (c) Alberto Pecora will hold an interest of 5% of the relevant share capital.
The equity value agreed between IWB and the sellers for the purchase of 85% of
Enovation's share capital is USD 22 million, which corresponds to an equity value for 100% of
the company of USD 25.9 million. The enterprise value of USD 26.0 million corresponds to an
EV/Ebitda adjusted buyside valuation multiple of 8.1x.
The agreements between IWB and the sellers also state that the payment of a portion equal
to 20% of the price, i.e. USD 4.4 million (i.e. 20% of USD 22 million), is subject to the condition
precedent of the achievement of accretive EBITDA results in 2022 and 2023. The agreements
between the parties also provide for earn-out mechanisms in favour of the brothers Alberto
and Giovanni Pecora in the event of strongly positive results of the company to be achieved by
31 December 2024. IWB will use its own cash on hands in order to finance this acquisition with
no recourse to new dedicated bank debt.
The execution of the agreements is subject to the fulfilment, by 30 April 2022, of certain
conditions precedent, including the positive outcome of the due diligence activities to be
carried out by IWB with specific regard to the authorisations and licences owned by Enovation
and the obtaining of the consents of the competent US authorities for the change in the
shareholding structure.
The agreements provide for the release by the respective sellers of a set of representations
and warranties (and related indemnification obligations subject to time limits, materiality
thresholds and caps in line with practice for similar transactions), as well as non-competition
undertakings by the sellers, undertaken with respect to both IWB and Enovation, and non-
solicitation and non-reversal employee undertakings.
Through the integration of Enovation, IWB will have direct access to the American market,
which is the main market for Italian wines abroad (EUR 1.8 billion in estimated value in 2021).
Among the immediate revenue synergies generated by the transaction, Enovation will
certainly benefit from the distribution to its customers of new red wine references, produced
in particular in Puglia and Piemonte, where IWB has its own production cellars, while IWB will
be able to offer Enovation-branded products on the international markets served through its
own commercial network. With regard to cost synergies, possibilities to reduce the purchase
price of raw materials will be explored, linked to the higher purchase volumes achieved at
group level. The transaction also confirms IWB's propensity to grow both organically and
through acquisitions, this being the fourth transaction completed in less than four years after
Svinando.com, Raphael Dal Bo Ag and Enoitalia S.p.A..
The signing of the agreements for the acquisition of the majority shareholding in Enovation
was positively evaluated by the Board of Directors of IWB as a transaction with a strong
29 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
29 |
strategic value and with contents and potential to increase the value of the Company's shares.
For the purposes of the Board's evaluations, the independent expert EY Advisory S.p.A. was
specifically engaged to provide benchmark support for the analysis of the estimated value, as
of June 30, 2021, for the valuation, from a financial point of view, of the consideration agreed
with the shareholders of Enovation in the context of the transaction.
The Company's Board of Directors also approved the transaction subject to the favourable
opinion issued by the Company's Independent Director, Antonella Lillo, regarding the signing
of the sale and purchase agreement with Norina, as well as on the appropriateness and
fairness of the related conditions. This opinion was issued because Norina is a “related party”
of the Company as it belongs to the four family branches of the Pizzolo family, including the
Vice Chairman of IWB, Giorgio Pizzolo, and the director of IWB, Marta Pizzolo. It should be
noted that the sale and purchase of the Norina Shareholding qualifies as a related-party
transaction of “less importance” pursuant to the “Procedure for transaction with related
party” adopted by the Company and the Regulation approved by Consob with resolution No.
17221/2010.
2.1.4 Asset management
From the point of view of asset management, it should be noted that in 2021 dividends were
distributed for a total of Euro 4,794 thousand, n. 2,400 Italian Wine Brands treasury shares for
a total of Euro 52 thousand at an average price of Euro 21.84 per share.
With reference to the effects on the business of the group companies deriving from Covid-19
(SARS-CoV-2), it should be noted that during 2021 the necessary measures were maintained
to ensure the continuation of company activities (ie organization of company spaces to ensure
the necessary distancing between people, incentives for remote work with reference to office
activities, creation of separate teams for production and transport activities).
As evidenced by the economic and financial results, there were no particular negative effects
on company performance, thanks to the presence of the group on markets / channels not
impacted by Covid-19 (mainly e-commerce and large-scale distribution operators). The
administrative bodies of all the companies of the group keep the situation carefully monitored
in order to ensure any timely interventions where necessary to guarantee the ordinary
continuation of the business.
2.2 Significant events subsequent to the end of the 2021 financial year and foreseeable
management evolution
During the first months of 2022 there was a significant growth both in terms of volumes and in terms of
order values, the overall order portfolio and deliveries to both existing customers and new accounts.
As regards the inflationary tensions recorded starting from October 2021 and exacerbated following the
outbreak of the war in Ukraine, there are increases in the cost of glass, electricity and gas, transport and
packaging that could have an economic effect starting from April of the current year. These cost
increases, for the period April - December 2022, could produce the following effects:
- Glass: approximately +3 cents per bottle;
- Electricity and Gas: + Euro 2.0 million overall;
- Transport and packaging: + Euro 3.0 / 3.5 million overall.
Following such events, which is estimated to have an overall impact with a cost increase of
approximately 6/7 cents per bottle in the period April - December 2022, since the beginning of the year
the group has implemented a tightening strategy differentiated for each type of customer / product in
order to maintain profit margins.
In particular, in relation to the turnover towards:
- of wholesale customers and ho.re.ca customers. of "branded" products (about 55% of the
group's total turnover), starting from March it was possible to reverse the increases on sales
prices, while keeping sales trends monitored and the defense of market shares reached. This
maneuver was also and above all possible in a context of strong demand for branded products
from the IWB group and relative scarcity of alternative products;
- of direct customers (distance selling, about 20% of the total turnover of the group), a massive
storage of raw materials was carried out starting from June 2021 which allowed the full defense
of margins in the period November 2021 - March 2022 and starting from April 1, 2022, an
increase in the price lists to the public of 6% on average will be applied;
- of wholesale customers of "private label" products (approximately 25% of the group's total
turnover), agreements have been defined or are still being negotiated with discount chains and
retailers which alternatively foresee for:
o the adjustment of the sales price lists;
o the setting up of multi-year sales agreements with underlying supply chain contracts;
o the setting up of "cost-plus" supply agreements, which provide for the recognition of
the margin for sourcing / winemaking / bottling in favor of IWB and the purchase of
31 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
31 |
raw material directly by the end-customer.
The forecast for the coming months, for this limited portion of company turnover, is to be able
to absorb most of the aforementioned increases.
From the supply of goods perspective, there are tensions on deliveries of raw materials, however not
such as to affect the normal performance of the business and the volume of deliveries to end customers.
The group's exposure to sales made in the Russian Federation is very limited, totaling
approximately Euro 2.0 million in 2021, already almost completely collected by IWB before the
outbreak of the war in Ukraine.
4. Codice etico e Modello organizzativo
On 27 July 2021, the parent company IWB Spa approved the adoption of the Organization,
Management and Control Model (the "231 Model") as required by Legislative Decree 231 of 8
June 2001, consistent with company processes and procedures and with the Group's
integration plan.
The model consists of a General Part, a Special Part and the Code of Ethics which, in line with
that adopted by Giordano Vini, constitutes an ideal alliance that the Group clearly establishes
with its Human Resources and with the main external interlocutors.
The entrepreneurial goals of the IWB. they are pursued without ever losing sight of respect,
responsibility, transparency, sobriety and continuous innovation, points of reference that have
always made it possible to guarantee the centrality of the "Customer" to whom to always offer
maximum satisfaction.
The drafting of the Model was carried out through (i) the gap analysis and identification of
sensitive processes in view of the most recent predicate offenses referred to in Legislative
Decree 231/2001; (ii) verification of the existence of a system of proxies and powers of
attorney connected with the organizational responsibilities assigned; (iii) the revision of the
prevention and control protocols based on the principle of segregation of duties.
At the same time, the Board of IWB S.p.A. proceeded with the appointment of the Supervisory
Body.
5. Rapporti con imprese correlate
The operations carried out are part of normal business management, within the typical activity
of each interested party, and are regulated under standard conditions.
(i) a commercial lease agreement entered into on 1 February 2012 between Provinco
Italia S.p.A. and Provinco S.r.l. pursuant to which Provinco S.r.l. leased the property
located in Rovereto (TN) - Via per Marco, 12/b to Provinco Italia S.p.A.; the lease
is valid for six years (until 31 January 2018) with tacit renewal for the same period
unless notice of termination is given 12 months before expiry; the agreed rent is
equal to €60 thousand per year plus VAT.
(ii) (ii) service contracts with Electa SpA concerning respectively (a) support for the
preliminary analyzes and the executive definition of M&A projects for an amount
equal to Euro 80 thousand (b) services to support the analysis of possible financing
alternatives, the definition of the terms and conditions of the loans, the review of
the documentation and the fulfillment of the related corporate obligations for an
amount equal to € 100 thousand (c) support for investor relations activities for an
amount equal to € 40 thousand
It should also be noted that, as detailed in the paragraph Significant events of the year for the
acquisition of 55% of Enovation Inc the Company's Board of Directors approved the
transaction subject to the favourable opinion issued by the Company's Independent Director,
Antonella Lillo, regarding the signing of the sale and purchase agreement with Norina, as well
as on the appropriateness and fairness of the related conditions. This opinion was issued
because Norina is a “related party” of the Company as it belongs to the four family branches
of the Pizzolo family, including the Vice Chairman of IWB, Giorgio Pizzolo, and the director of
IWB, Marta Pizzolo. It should be noted that the sale and purchase of the Norina Shareholding
qualifies as a related-party transaction of “less importance” pursuant to the “Procedure for
transaction with related party” adopted by the Company and the Regulation approved by
Consob with resolution No. 17221/2010.
It should be noted that the Parent IWB has adopted and follows the related Related Party
Procedure in compliance with the general provisions of the Euronext Growth Milan Issuer
Regulations.
6. Information relating to the environment, safety and personnel
HEALTH AND SAFETY
The subsidiary Giordano Vini S.p.A. - which owns industrial buildings for production purposes
- has implemented the Risk Assessment Document required by the law on safety at work.
33 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
33 |
Said document provides for an analysis of the risks present in the company both in terms of
work activities and settlement methods; then it identifies the measures taken to minimize
risks, those still to be taken and those to maintain an adequate level of safety. Finally, the
necessary timeframes for the implementation of the remaining measures are identified.
The method of carrying out the work activity was considered in the analysis of the risks without
specific risk situations being identified. The subject is always under control in the periodic
updates of these documents.
The Risk Assessment Documents, as well as the Emergency Plans and Maps with safety signs
and exit routes are periodically updated.
During first half 2021, constant health monitoring activities were carried out, as required by
current legislation.
During the period, awareness activities continued on environmental and safety issues with ad-
hoc training initiatives, as well as on the accident prevention measures and first aid, providing
specific training for firefighting and first-aid workers, in full compliance with the reference
regulatory framework.
UNI ISO 45001:2018 CERTIFICATION
(Occupational Health and Safety Assessment Series)
Starting in 2012, the companies of the Italian Wine Brands Group adopted an Occupational
Health and Safety Management System in compliance with the international standard OHSAS
18001:2007 (Occupational Health and Safety Assessment Series).Starting from 2021the
company updated to UNI ISO45001:2018 certification.
UNI ISO45001:2018 certification is not a legal obligation but the voluntary choice of those who
feel responsibility for their own safety and that of others and puts these principles into practice
through the adoption of a Health and Safety Management System for Workers.
The primary objective of a safety management system is to prevent and minimize accidents
and incidents by integrating safe work practices into all areas of an organization.
Through this certification, the third-party accredited body SGS ITALIA S.p.A. has recognized
that the companies of the Group have implemented a management system in line with the
highest safety standards and have also pursued its objectives continuously, making significant
improvements to safety conditions in the workplace.
As part of its management system, the Group has sanctioned its commitment through the
"Quality and Safety Policy" as a tool by which the entire company’s mission is to offer an
increasing number of customers in the world food and wine products of the finest Italian
traditions, in the comfort of the exclusive service of the Group, considering the protection of
workers’ health and safety as an integral part of its business.
Adherence to the ISO 45001 standard (previously OHSAS 18001) "Management systems for
health and safety at work defines Enoitalia's commitment to implement a management system
for health and safety at work (SSL) to ensure workplaces safe and healthy and proactively
improve their performance
In addition, the company is subjected every two years to ethical audits according to the Sedex
Smeta 2 pillar scheme and to audits in order to ascertain supply chain security
MANAGEMENT FOR QUALITY AND FOOD SAFETY.
Giordano SpA after having obtained the ISO 9001 Certification about ten years ago, in March
2015, they obtained the IFS Food Certification (for the German market) and the BRC Food
Certification (for the United Kingdom) in order to constantly guarantee their Customers who
turn to large-scale distribution, a high level of production and safety of the products supplied,
but also by improving existing processes, obtaining better general safety, an improvement in
relations with the customer and a high level of competitiveness on the market.
Enoitalia has always accompanied its significant growth on the markets with the continuous
and concrete commitment to continuous improvement, gradually pursuing important
certification objectives in line with the requests of the international customers served and in
line with the internal growth of the organization.
35 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
35 |
Therefore, adherence to certification standards has always been progressive and concretely
supported by the internal growth of the organization with the aim of keeping in line with the
expectations of the international customers served.
Today, with the commitment of the quality assurance team and the entire organization, from
the workers to the top management, Enoitalia's operating sites are globally managed in
accordance with the following certification standards:
ISO 9001
ISO 9001 is intended by Enoitalia as the reference standard for planning, implementing,
monitoring and improving both operational and support processes. The quality management
system is implemented and implemented as a means to achieve the objectives. The customer
and his satisfaction are at the heart of Enoitalia's business logic; every activity, application
and monitoring of the activities / processes is in fact aimed at determining the maximum
satisfaction of the customer. The phases of application of the standard start from the
definition of the procedures and records for each individual process or macro process
identified within the company organization in accordance with a careful analysis of the
company opportunities, the definition of the mission and the company vision expressed
through the policy of quality.
ISO 14001
Adherence to the environmental management standard constitutes historical baggage for
Enoitalia. The company has been certified for more than 20 years, demonstrating its
commitment to keep the environmental impacts of its activities under control, and to
systematically seek improvement in a consistent and effective way.
BRC E IFS (food safety)
The certification schemes, a reference and prerequisite for the international customers served,
have the purpose of guaranteeing food safety. The audits take place annually. Enoitalia
adheres to them for each site in the unannounced manner, confident of the commitment of
the whole organization to compliance with the defined rules.
VIVA la sostenibilità nella vitivinicoltura
Enoitalia is on the second renewal (two-year validity) of the VIVA sustainability certification to
which it adheres as an Organization, which aims to improve and communicate sustainability
performance to stakeholders through the analysis of 3 indicators (Air, Water, Territory)
Product certifications are also active according to organic schemes and vegan regulations.
GROUP WORKFORCE
The precise and average headcount by category at 31 December 2021, at 31 December
2021 and at 31 December 2019 is shown below for the Group companies:
7. Treasury shares
As of 31/12/2021 the Parent Company holds no. 6,092 ordinary shares, representing 0.08%
of the ordinary share capital. As part of the purchase authorization approved by the
Shareholders' Meeting on 7 February 2020, as of 30 June 2021, an additional 2,400 treasury
shares were purchased and 34,612 ordinary shares and 34,612 phantom shares were
assigned in relation to the Italian Wine Brands SpA and following the accrual of a total of no.
69,224 rights relating to the first tranche included in the performance period of the Plan.
At Average no At Average no At Average no
31.12.2021 31.12.2021 31.12.2020 31.12.2020 31.12.2019 31.12.2019
Executives 6 6 6 7 6 8
Middle managers 21 21 14 12 10 10
Employee 174 161 121 122 122 126
Workers 127 128 20 19 16 18
Total 328 317 161 160 154 162
37 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
37 |
CONSOLIDATED BALANCE SHEET
Note
31.12.2021 31.12.2020
Amounts in EUR
Non-current assets
Intangible fixed assets
5 35.983.013 34.004.563
Goodwill 6 181.085.190 68.308.732
Land, property, plant and equipment 7 50.123.900 15.104.117
Right-of-use assets 7 14.041.962
Equity investments 8 2.859 2.496
Other non-current assets 9 2.327.877 223.504
Deferred tax assets 10 1.515.513 1.846.158
Total non-current assets
Current assets
Inventory 11 77.907.701 25.490.065
Trade receivables 12 68.143.859 30.566.837
Other current assets 13 2.395.938 1.402.285
Current tax assets 14 7.402.216 2.096.047
Current financial assets 1.113.163 57.426
Cash and cash equivalents 15 59.103.393 33.401.735
Total current assets
Non-current assets held for sale
Total assets
Shareholders’ equity
Share capital
Reserves
Reserve for defined benefit plans
(77.633 )
(66.778 )
Reserve for stock grants
Profit (loss) carried forward
Net profit (loss) for the period
Total Shareholders’ Equity of parent company shareholders
Shareholders’ equity of NCIs
Total Shareholders’ Equity
16 159.954.385
Non-current liabilities
Financial payables
17 135.725.740 23.806.909
Right-of-use liabilities
17 10.891.065 8.821.241
Provision for other employee benefits
18 1.212.286 621.328
Provisions for future risks and charges
19 333.891 260.141
Deferred tax liabilities
10 9.966.431 9.874.128
Other non-current liabilities
21
Total non-current liabilities
Current liabilities
Financial payables 17 32.467.349 10.076.307
Right-of-use liabilities 17 2.388.122 1.088.147
Trade payables 20 137.367.109 56.808.562
Other current liabilities 21 9.507.718 4.166.831
Current tax liabilities
22
Provisions for future risks and charges
19
Derivatives - -
Total current liabilities 183.062.785 74.236.252
Liabilities directly related to assets held for sale - -
Total shareholders’ equity and liabilities 501.146.584 222.140.508
CONSOLIDATED PROFIT AND LOSS
Note
31.12.2021 31.12.2020
Amounts in EUR
Revenue from sales
23 313.226.713
Change in inventories
11 13.332.751
Other income
23
Total revenue
Purchase costs
24
(217.704.762 )
(123.650.253 )
Costs for services
25 (64.208.638 )
(53.325.328 )
Personnel costs
26 (15.289.502 )
(8.685.129 )
Other operating costs
27
(1.013.998 )
(1.365.143 )
Operating costs
(298.216.900 )
(187.025.853 )
EBITDA
Depreciation and amortization
5-7
(6.948.102 )
(3.959.744 )
Provision for risks
19
Write-ups / (Write-downs)
28
(1.152.492 )
(1.425.778 )
Operating profit/(loss)
Finance revenue
Borrowing costs
(4.529.499 )
(1.401.691 )
Net financial income/(expenses)
29
(3.938.180 )
(1.186.048 )
EBT
Taxes
30 (4.433.324 )
(2.838.948 )
(Loss) Profit from discontinued operations
Profit (loss) (A)
Attributable to:
(Profit)/Loss of NCIs
Group profit (loss)
Other Profit/(Loss) of comprehensive income statement:
Other items of the comprehensive income statement for the
period to be subsequently released to profit
or loss
Other items of the comprehensive income statement for the
period not to be subsequently released to profit
or loss
Actuarial gains/(losses) on defined benefit plans 18 (10.856 ) (5.565 )
Tax effect of Other profit/(loss) - -
Total other profit/(loss), net of tax effect (B) (10.856 ) (5.565 )
Total comprehensive profit/(loss) (A) + (B) 14.526.220 14.186.987
39 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
39 |
CHANGES IN CONSOLIDATED SHAREHOLDERS’ EQUITY
Amounts in in Eur
Share Capital Capital Reserves
Riserve for stock
grants
Reserve from
financial assets
available for sale
Reserve for defined
benefit plans
Retained earnings Total
Balance sheet at 1 January 2020
Capital increase -
Purchase of own shares
(1.701.455 )
(1.701.455 )
Sale of own shares
Dividends
(739.809 )
(739.809 )
Stock grants
Legal reserve -
Reclas sification and other changes
(19.934 ) 119.733
Total comprehensive profit/ (loss) (5.565 ) 14.192.552 14.186.987
Balance sheet at 31 December 2020
Capital increase
Purchase of own shares
(52.440 )
(52.440 )
Sale of own shares
Dividends
(4.793.595 )
(4.793.595 )
Stock grants
Legal reserve -
Reclas sification and other changes
(170.420 )
Total comprehensive profit/ (loss) (10.856 ) 14.537.076 14.526.220
Balance sheet at 31 December 2021 1.046.266 113.170.256 518.220 - (77.633 ) 45.297.277 159.954.385
CONSOLIDATED CASH FLOW
Amounts in EUR
31.12.2021 31.12.2020
Profit (loss) before taxes 18.970.400 17.031.500
Adjustments for:
- non-monetary items - stock grant - -
- allocations to the provision for bad debts net of utilizations 1.152.492 1.425.778
- non-monetary items - provisions / (releases) - -
- non-monetary items - amortisation/depreciation
Adjusted profit (loss) for the period before taxes 27.070.994 22.417.022
Cash flow generated by operations
Income tax paid (6.201.766 ) (5.032.145 )
Other financial (income)/expenses without cash flow (financial amortisation) 2.205.312 156.109
Total (3.996.454 ) (4.876.036 )
Changes in working capital
Change in receivables from customers (633.226 ) (7.520.849 )
Change in trade payables 19.556.589 10.538.491
Change in inventories (14.638.428 ) (4.486.377 )
Change in other receivables and other payables (19.231.443 ) 804.101
Other changes (29.865 ) (59.549 )
Change in post-employment benefits and other provisions 67.323 (758.172 )
Change in other provisions and deferred taxes
Total (14.486.102 ) (1.706.480 )
Cash flow from operations (1) 8.588.438 15.834.506
Capital expenditure:
- Tangible (2.835.873 ) (1.736.476 )
- Intangible (3.481.896 ) (3.064.227 )
- Net cash flow from business combination (*): (149.226.832 ) (11.641.919 )
- Financial
Cash flow from investment activities (2) (152.681.247 ) (16.442.622 )
Financial assets
Short-term borrowings 130.000.000 -
Short-term borrowings (paid) 32.542.000 17.816.780
Long-term borrowings/ (repayments) - Bond (9.000.000 ) (15.000.000 )
Collections / (repayments) Senior loan (16.625.000 ) (3.250.000 )
Collections / (repayments) other financial payables (2.038.000 ) (1.073.667 )
Change in other financial assets (1.055.737 ) 53.831
Change in other financial liabilities (4.914.740 ) 1.695.303
Purchase of own shares (52.440 ) (1.701.455 )
Sale of own shares - 2.685.391
Dividends paid (4.793.595 ) (739.809 )
Monetary capital increases 45.500.000 -
Change in reserve for stock grants 424.111 781.460
Other changes in shareholders equity
(192.132 ) 88.670
Cash flow from financing activities (3) 169.794.467 1.356.504
Cash flow from continuing operations 25.701.658 748.388
Change in cash and cash equivalents (1+2+3) 25.701.658 748.388
Cash and cash equivalents at beginning of period 33.401.735 32.653.347
Cash and cash equivalents at end of period 59.103.393 33.401.735
(*) Effects of the acquisition of 100 % of Enoitalia SpA shareholders' equity
as below detailed:
a) Total amount paid (cash): 150.500.000
b) Amount of cash and cash equivalents (with a negative sign): (1.273.168 )
41 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
41 |
FORM AND CONTENT
OF THE CONSOLIDATED FINANCIAL REPORT
Introduction
This Financial Report at 31 December 2021 has been prepared in accordance with the AIM
Regulation and in compliance with International Financial Reporting Standards ("IFRS") issued
by the International Accounting Standards Board ("IASB") and approved by the European
Union. The designation “IFRS” also includes all currently valid International Accounting
Standards (“IAS”), as well as all interpretations of the International Accounting Reporting
Interpretations Committee (“IFRIC”), formerly the Standing Interpretations Committee (“SIC”).
Directive 2004/109 / EC (the "Transparency Directive") and Delegated Regulation (EU)
2019/815 introduced the obligation for issuers of securities listed on regulated markets of the
European Union to draw up the annual financial report in the language XHTML, based on the
European Single Electronic Format (ESEF), approved by ESMA. For the year 2021 it is expected
that the consolidated financial statements must be "marked" with the ESEF taxonomy, using
an integrated computer language (iXBRL).
Statement of financial position schedules
This Financial Report at 31 December 2021 consists of the statement of financial position, the
statement of comprehensive income, the statement of changes in shareholders' equity, the
statement of cash flows and the notes, and is accompanied by the directors' report on
operations.
Statement of financial position schedules are prepared according following methodologies:
The format adopted for the Statement of Financial Position distinguishes between
current and non-current assets and liabilities.
The income statement format adopted provides for the classification of costs by
nature, more representative than “destination one”. The Group opted to present the
items of profit or loss for the year in a single statement of comprehensive income,
which includes the result for the period and, by homogeneous categories, income and
expenses which, in accordance with IFRS, are posted directly to shareholders' equity.
The statement of cash flows analyses the cash flows deriving from the operating
activities using the indirect method, whereby the profit (loss) for the period is adjusted
for the effects of non-monetary transactions, any deferrals or provisions relating to
previous or future operating receipts or payments and the revenue or cost items
connected with cash flows deriving from investing or financing activities.
The statement of changes in shareholders' equity includes, in addition to total
profits/losses for the period, the amounts of transactions with equity holders and
changes in reserves during the period.
The financial statements are presented in Euro, the reference currency for the Company.
Unless otherwise indicated, the figures reported in these notes are expressed in thousands of
Euro.
1 Consolidation area
Subsidiaries are defined as all investees in which the Group simultaneously has an interest:
- decision-making power, i.e., the ability to direct the relevant activities of the investee, i.e.,
those activities that have a significant influence on the results of the investee;
- the right to variable results (positive or negative) from an investment in the consolidated
entity;
- the ability to use its decision-making power to determine the amount of profit/loss arising
from an investment in a consolidated entity.
The financial statements of subsidiaries are included in the consolidated financial statements
from the date on which control is acquired until such time as control ceases to exist. Equity
shares and shares in the profit and loss of non-controlling interests are presented in the
consolidated statement of financial position and income statement respectively.
The entities included in the scope of consolidation and the relative percentages of direct or
indirect ownership by the Group are listed below:
2 General principles of preparation
The consolidated Annual Financial Report was prepared on a going concern basis.
Share Capital
Currency Value
IWB S.p.A.
Italy EUR 1.046.266 - Capogruppo
Provinco Italia S.p.A.
Italy EUR 132.857 IWB S.p.A. 100% 100%
Giordano Vini S.p.A.
Italy EUR 14.622.511 IWB S.p.A. 100% 100%
Enoitalia S.p.A.
Italy EUR 1.453.055 IWB S.p.A. 100% 100%
Provinco Deutschland GmbH
Germany EUR 25.000 Provinco Italia S.p.A. 100% -
Pro.Di.Ve. S.r.l.
Italy EUR 18.486 Giordano Vini S.p.A. 100% -
Raphael Dal Bo AG
Swiss CHF 100.000 Provinco Italia S.p.A. 100% -
Company Country Parent Company
Percentage Held
Percentage held
directly
43 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
43 |
The presentation currency being the Euro, and the amounts shown are rounded to the nearest
whole number, including, unless otherwise indicated, the amounts shown in the notes.
The cost principle has been adopted in the preparation of this Consolidated Annual Financial
Report, with the exception of derivative financial instruments measured at fair value.
The most significant accounting standards adopted in the preparation of this consolidated
financial statements are:
Valuations and significant accounting estimates
The preparation of the consolidated interim financial statements requires the making of
estimates and assumptions that have an effect on the values of the assets and liabilities in the
financial statements and on the information relating to potential assets and liabilities at the
date of the financial statements. The final results could differ from the estimates made which
are based on data that reflect the current state of the information available. The estimates are
used to record the provisions for credit risks, asset write-downs, current and deferred taxes,
other provisions and provisions. The estimates and assumptions are periodically reviewed and
the effects of each change are immediately reflected in the income statement.
With regard to the valuation of financial assets, due to the nature of the financial assets held
by the Group relating mainly to cash and cash equivalents, and receivables from the tax
authorities for VAT, there are no particular risks arising from the uncertainties defined above.
***
The accounting principles adopted in the preparation of the consolidated half-year financial
report comply with those used for the preparation of the Group's annual financial statements
for the year ended 31 December 2020 with the exception of the accounting principles,
amendments and interpretations which were applied for the first time. by the Group starting
from 1 January 2021, described below.
The general principle adopted in the preparation of this consolidated Annual Financial Report
is that of cost, with the exception of derivative financial instruments measured at fair value.
The most significant accounting principles adopted in the preparation of these consolidated
financial statements are as follows:
Business combinations
Business combinations are accounted for using the acquisition method. The cost of an
acquisition is calculated as the sum of the amount paid, valued at fair value as at the acquisition
date, and the amount of any non-controlling interest held in the acquired asset. For each
business combination, the purchaser must assess any non-controlling interest held in the
acquired property at fair value or proportionate to the non-controlling interests held in the net
identifiable assets of the acquired property. Acquisition costs are expensed and classified as
administrative expenses.
At the acquisition date, the identifiable assets acquired and liabilities assumed are recognized
at fair value at the acquisition date; exceptions to this are deferred tax assets and liabilities,
assets and liabilities for employee benefits, liabilities or equity instruments relating to share-
based payments of the acquired company or share-based payments issued in place of
contracts of the acquired company, and assets (or groups of assets and liabilities) held for sale,
which are instead measured according to their reference standard.
Any potential consideration must be recorded by the purchaser at fair value at the date of
acquisition and classified according to IAS 32.
Goodwill is initially measured at cost, which is the excess of the sum of the consideration
transferred in the business combination, the value of shareholders' equity attributable to non-
controlling interests and the fair value of any investment previously held in the acquiree over
the fair value of the net assets acquired and liabilities assumed at the acquisition date. If the
value of the net assets acquired and liabilities assumed at the acquisition date exceeds the sum
of the consideration transferred, the value of the shareholders' equity pertaining to non-
controlling interests and the fair value of any investment previously held in the acquiree, this
excess is immediately recognized in profit or loss as income from the transaction concluded.
The portions of shareholders' equity pertaining to non-controlling interests at the acquisition
date can be measured at fair value or at the pro-rata value of the net assets recognized for the
acquiree. The choice of valuation method is made on a transaction-by-transaction basis.
Any contingent consideration provided for in the business combination contract is measured
at fair value at the acquisition date and included in the value of the consideration transferred
in the business combination for the purpose of determining goodwill. Any subsequent changes
in this fair value, which may be qualified as adjustments arising during the measurement
period, are retrospectively included in goodwill. Changes in fair value that qualify as
adjustments arising during the measurement period are those resulting from additional
information on facts and circumstances that existed at the acquisition date, obtained during
the measurement period (which may not exceed one year from the business combination).
In the case of business combinations carried out in stages, the equity investment previously
held in the acquiree is revalued at fair value at the date of acquisition of control and any
resulting profit or loss is recognized in the income statement. Any amounts deriving from the
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equity investment previously held and recognized in Other comprehensive income are
restated in profit or loss as if the equity investment had been sold.
If the initial amounts of a business combination are incomplete at the reporting date of the
financial statements in which the business combination took place, provisional amounts of the
items for which recognition cannot be completed are reported in the consolidated financial
statements. These provisional amounts are adjusted during the measurement period to take
into account new information obtained about facts and circumstances existing at the
acquisition date that, if known, would have affected the amount of the assets and liabilities
recognized at that date.
Transactions in which the parent company acquires or sells further bon-controlling interests
without changing the control exercised over the subsidiary are transactions with shareholders
and therefore the relative effects must be recognized in shareholders' equity: there will be no
adjustments to goodwill and no gains or losses recognized in the income statement.
Ancillary charges relating to business combinations are recognized in profit or loss in the period
in which they are incurred.
Intangible assets with indefinite useful life
Goodwill
Goodwill is recognized as an asset with an indefinite useful life and is not amortized, but tested
for impairment annually, or more frequently if there is an indication that specific events or
changed circumstances may have caused an impairment loss. Impairment losses are
immediately recognized in profit or loss statement and are not subsequently reversed. After
the initial recognition, goodwill is valued at cost, net of any accumulated impairment losses.
In order to test for impairment, goodwill acquired in a business combination is allocated, at
the acquisition date, to the individual cash-generating units or groups of cash-generating units
that should benefit from the synergies of the combination, regardless of whether other assets
or liabilities of the acquiree are assigned to those units or groups of units.
Each unit or group of units to which goodwill is allocated represents the lowest level at which
goodwill is monitored for internal management purposes.
Any loss in value is identified by comparing the carrying amount of the cash generating unit
with its realizable value. If the realizable value of the cash-generating unit is lower than the
carrying amount attributed, the related impairment loss is recognized. This impairment loss is
reversed if the reasons for it no longer exist.
If goodwill has been allocated to a cash-generating unit and the entity disposes of part of the
assets of that unit, the goodwill associated with the disposed asset shall be included in the
carrying amount of the asset when determining the gain or loss on disposal. The goodwill
associated with the discontinued asset must be determined on the basis of the relative values
of the discontinued asset and the portion of the cash-generating unit retained.
Trademark
With effect from 1 January 2014, the Directors of Giordano Vini S.p.A., also with the support
of an independent expert, attributed an indefinite useful life to the trademark acquired as part
of a merger transaction. As part of the business combination carried out in 2015, with regard
to Provinco Italia S.p.A., part of the purchase price was allocated to the trademarks owned by
Provinco, attributing an indefinite useful life to them as well.
Intangible assets with finite useful life
Intangible assets with finite useful life are valued at purchase or production cost net of
amortization and accumulated impairment losses. Depreciation is commensurate with the
expected useful life of the asset and begins when the asset is available for use. The useful life
is reviewed annually, and any changes are made prospectively.
Whenever there are reasons to do so, intangible assets with a finite useful life are tested for
impairment.
Other intangible assets
Other intangible assets are recognized in the statement of financial position only if it is
probable that the use of the asset will generate future economic benefits and if the cost of the
asset can be measured reliably. Once these conditions are met, intangible assets are recorded
at purchase cost, which corresponds to the price paid plus accessory charges.
The gross carrying amount of other intangible assets with a finite useful life is systematically
allocated over the years in which they are used, by means of constant amortization charges,
in relation to their estimated useful life. Amortization begins when the asset is available for
use and is proportionate, for the first reporting period, to the period of actual use. The
amortization rates used are determined on the basis of the useful life of the related assets.
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The useful life values used for the purposes of preparing this Consolidated Annual Financial
Report are as follows:
CATEGORY
USEFUL LIFE
Concessions, licenses, trademarks and similar rights
10 years
Industrial patent and use of intellectual property
3 years
Project for adjustment of management control
3 years
Software and other intangible assets
3-4 years
Right-of-use assets
Lease contracts are recorded as rights of use under non-current assets with a balancing entry
in a financial liability. The cost of the fee is broken down into its components of financial
expense, recorded in profit or loss over the term of the contract, and repayment of principal,
recorded as a reduction of the financial liability. The right of use is amortized on a monthly
basis on a straight-line basis over the shorter of the asset's useful life and the term of the
contract.
Rights of use and financial liabilities are initially measured at the present value of future
payments discounted using the incremental borrowing rate.
For a more detailed discussion of the subject see paragraph 4.1.
Land, property, plant and equipment
Tangible assets are composed of:
x industrial land and buildings
x plant and equipment
x industrial and commercial equipment
x other assets
These are recorded at purchase or production cost, including directly attributable ancillary
charges necessary for putting the asset into operation for its intended use.
The cost is reduced by depreciation, with the exception of land, which is not depreciated
because it has an indefinite useful life, and any losses in value.
Depreciation is calculated on a straight-line basis using percentages that reflect the economic
and technical deterioration of the asset and is calculated from the moment in which the asset
is available for use.
Significant parts of property, plant and equipment with different useful life are accounted for
separately and depreciated over their useful life.
The useful life of assets and residual values are reviewed annually at the time of closing the
financial statements. The useful life values used for the purposes of preparing this
Consolidated Annual Financial Report are as follows:
CATEGORY
USEFUL LIFE
Land
Indefinite
Buildings
18-50 years
Plant and equipment:
- Means of transport for interiors
10-12 years
- Generic plant
8-18 years
- Machinery
6-15 years
- Vats and tanks
4-20 years
Industrial and commercial equipment:
- Cars
5-8 years
- Equipment
8-12 years
- Electronic machines
4-8 years
- Ordinary office machines and furniture
15 years
- Goods on loan for use
4 years
Routine maintenance and repair costs are recognized directly in profit or loss in the period in
which they are incurred.
Profits and losses arising from the sale or disposal of property, plant and equipment are
determined as the difference between the sale proceeds and the net carrying amount of the
asset and are recognized in profit or loss for the period.
Leasehold improvements with the characteristics of fixed assets are capitalized in the category
of the asset to which they refer and are depreciated over their useful life or, if shorter, over
the duration of the lease agreement.
Financial charges, incurred for investments in assets which normally require a certain period
of time to be ready for use or sale (qualifying asset pursuant to IAS 23 - Borrowing Costs), are
capitalized and amortized over the useful life of the class of assets to which they refer.
All other financial charges are recognized in profit or loss in the period in which they are
incurred.
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Impairment of assets
At least once a year it is checked whether the assets and/or the cash generating units ("CGUs")
to which the assets are attributable may have suffered an impairment loss. If there is such
evidence, the realizable value of the assets/CGUs is estimated. Goodwill and other intangible
assets with an indefinite useful life are tested for impairment annually or more frequently,
whenever there is an indication that the asset may be impaired.
Realizable value is defined as the higher of its fair value less costs to sell and value in use. The
value in use is defined on the basis of the discounting back of the future cash flows expected
from the use of the asset, gross of taxes, applying a discount rate that reflects current market
changes in the time value of money and the risks of the asset.
If it is not possible to estimate the realizable value of the individual fixed asset, the recoverable
value of the cash-generating unit (CGU) to which the fixed asset belongs is determined.
If the realizable value of an asset (or cash-generating unit) is lower than its carrying amount,
the carrying amount is reduced to its recoverable amount and the loss is recognized in profit
or loss. Subsequently, if an impairment loss on assets other than goodwill ceases to exist or
decreases, the carrying amount of the asset (or cash-generating unit) is increased to the new
estimate of its realizable value (which, however, may not exceed the net carrying amount that
the asset would have had if the impairment loss had never been recognized). This reversal is
immediately recognized in profit or loss.
Equity investments
Investments in subsidiaries not included in the scope of consolidation are stated at cost,
adjusted for impairment. The positive difference resulting from the acquisition between the
acquisition cost and the portion of the shareholders' equity at replacement cost of the investee
company pertaining to the period is therefore included in the carrying amount of the
investment. If there is evidence that these investments have suffered a loss in value, this is
recorded in the income statement as a write-down. In the event that any share of the losses
of the investee exceeds the carrying amount of the investment, and the entity has an
obligation to account for them, the value of the investment is written off and the share of any
further losses is recognized as a provision under liabilities. If, subsequently, the loss in value
no longer exists or is reduced, a reversal of the impairment loss within the limits of cost is
recognized in profit or loss.
Associates are all companies over which the Group is able to exercise significant influence as
defined by IAS 28 - Investments in Associates and Joint Ventures. Such influence is normally
presumed to exist when the Group holds a percentage of voting rights between 20% and 50%,
or when - even with a lower percentage of voting rights - it has the power to participate in the
determination of financial and management policies by virtue of particular legal ties such as,
for example, participation in shareholders' agreements together with other forms of significant
exercise of governance rights.
Joint arrangements are agreements under which two or more parties have joint control on the
basis of a contract. Joint control is the contractually agreed sharing of control of an
arrangement, which exists only when decisions about the relevant activities require the
unanimous consent of the parties sharing control. Such agreements may give rise to joint
ventures or joint operations.
A joint venture is a joint arrangement whereby the parties that have joint control of the
arrangement have rights to the net assets of the arrangement Joint ventures differ from joint
operations, which are arrangements that give the parties to the arrangement which have joint
control over the initiative, rights over the individual assets and obligations for the individual
liabilities relating to the arrangement. In the case of joint operations, it is mandatory to
recognize the assets and liabilities, costs and revenues of the arrangement in accordance with
the relevant accounting standards. The Group has no joint operation arrangements in place.
Financial instruments
Financial instruments are included in the statement of financial position items described
below. Investments and other non-current financial assets include investments in subsidiaries
and other non-current financial assets. Current financial assets include trade receivables and
cash and cash equivalents. In particular, cash and cash equivalents include bank deposits.
Financial liabilities refer to financial payables, including payables for advances on orders,
assignment of receivables, as well as other financial liabilities (which include the negative fair
value of derivative financial instruments), trade payables and other payables.
Non-current financial assets
Non-current financial assets other than equity investments, as well as financial liabilities, are
accounted for in accordance with IFRS 9. Loans and receivables not held for trading and assets
held with the intention of keeping them in the portfolio until maturity are valued at amortized
cost, using the effective interest method. When financial assets do not have a fixed maturity,
they are valued at purchase cost. Evaluations are regularly carried out to verify whether there
is objective evidence that a financial asset may have been impaired. If there is objective
evidence, the impairment loss shall be recognized as an expense in the income statement for
the period. With the exception of derivative financial instruments, financial liabilities are stated
at amortized cost using the effective interest method.
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Trade receivables and payables
Trade receivables are initially recorded at amortized cost, which coincides with the adjusted
nominal value, in order to adjust it to the presumed realizable value, by recording a provision
for bad debts. This provision for bad debts is commensurate with both the size of the risks
relating to specific receivables and the size of the general risk of non-collection impending on
all the receivables, prudentially estimated based on past experience and the degree of known
financial equilibrium of all debtors.
Trade and other payables are recorded at their nominal value, which is considered
representative of the settlement value. Receivables and payables in foreign currencies are
aligned with the exchange rates prevailing on the reporting date and gains or losses deriving
from conversion are entered in profit or loss.
Receivables assigned as a result of factoring transactions are eliminated from the statement
of financial position if the risks and rewards of ownership have been substantially transferred
to the assignee, thus constituting a non-recourse assignment. The portion of disposal costs
that is certain to be included in the quantum amount is recognized as a financial liability.
Collections received on behalf of the factoring company and not yet transferred, generated by
the contractual terms and conditions that provide for the periodic and predetermined transfer,
are stated under financial liabilities.
Cash and cash equivalents
The item relating to cash and cash equivalents includes cash, bank current accounts, postal
current accounts, deposits repayable on demand and other short-term highly liquid financial
investments that are readily convertible into cash and are subject to an insignificant risk of
change in value.
Financial payables
Financial liabilities include financial payables, including payables for deferred price parts
relating to the assignment of non-recourse receivables, as well as other financial liabilities.
Financial liabilities, other than derivative financial instruments, are initially recorded at market
value (fair value) less transaction costs; they are subsequently valued at amortized cost, i.e.,
at their initial value, net of principal repayments already made, adjusted (upwards or
downwards) on the basis of the amortization (using the effective interest method) of any
differences between the initial value and the value at maturity.
Inventory
Inventory is recorded at the lower of purchase or production cost and realizable value,
represented by the amount that the entity expects to obtain from their sale in the normal
course of business. The cost configuration adopted is the weighted average cost. Purchase
costs include prices paid to suppliers increased by ancillary costs incurred up to entry into the
warehouse, net of discounts and rebates. Production costs include both direct costs of
materials and labor and reasonably attributable indirect production costs. In the allocation of
production overheads, the normal production capacity of the plants is taken into account for
the allocation of the cost of the products.
Provisions are made for the value of inventory determined in this way to take into account
inventory considered obsolete or slow-moving.
Inventory also includes production cost relating to returns expected in future periods in
connection with deliveries already made, estimated based on the sales value less the average
mark-up applied.
Assets and liabilities held for sale
Assets and liabilities held for sale and discontinued operations are classified as such if their
carrying amount will be recovered principally through sale rather than through continuing use.
These conditions are considered to have been met when the sale or discontinuance of the
group of assets being disposed of is considered highly probable and the assets and liabilities
are immediately available for sale in the conditions in which they are located.
When an entity is involved in a disposal plan that results in a loss of control of an investee, all
assets and liabilities of that investee are classified as held for sale when the above conditions
are met, even if, after disposal, the entity continues to hold a non-controlling interest in the
subsidiary.
Assets held for sale are valued at the lower of their net carrying amount and fair value net of
selling costs.
Employee benefits
Bonuses paid under defined-contribution plans are recognized in profit or loss for the portion
accrued during the year.
Until 31 December 2006, the provision for employee severance indemnities (TFR) was
considered a defined benefit plan. The rules governing this fund were amended by Law 296 of
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53 |
27 December 2006 ("2007 Finance Act") and subsequent Decrees and Regulations issued in
early 2007. In light of these changes, and in particular with reference to companies with at
least 50 employees, this scheme is now to be considered a defined benefit plan solely for the
amounts accrued before 1 January 2007 (and not yet paid at the reporting date), while for the
amounts accrued after that date it is similar to a defined contribution plan.
Defined-benefit pension plans, which also include severance indemnities due to employees
pursuant to Article 2120 of the Italian Civil Code, are based on the working life of the
employees and the remuneration received by the employee during a predetermined period of
service. In particular, the liability representing the benefit due to employees under defined
benefit plans is recorded in the financial statements at its actuarial value.
The recognition of defined benefit plans requires the actuarial estimation of the amount of
benefits accrued by employees in exchange for service rendered in the current and prior
periods and the discounting back of such benefits in order to determine the present value of
the entity's commitments. The present value of the commitments is determined by an
independent actuary using the projected unit credit method. This method considers each
period of service provided by employees at the company as an additional unit under law:
actuarial liability must therefore be quantified only on the basis of the seniority accrued at the
valuation date; therefore, total liability is normally re-proportioned based on the ratio
between the years of service accrued at the valuation date of reference and the total seniority
achieved at the time envisaged for the payment of the benefit. In addition, the above method
provides to consider future salary increases, for whatever reason (inflation, career, contract
renewals, etc.), until the time of termination of employment.
The cost of defined-benefit plans accrued during the year and recorded in profit or loss as part
of personnel expenses is equal to the sum of the average current value of the rights accrued
by the employees present for the work performed during the period, and the annual interest
accrued on the present value of the commitments of the entity at the beginning of the period,
calculated using the discount rate of future disbursements adopted for the estimate of the
liability at the end of the previous period. The annual discount rate adopted for the calculations
is assumed to be equal to the market rate at the end of the period for zero coupon bonds with
a maturity equal to the average residual duration of the liability.
The amount of actuarial losses and gains deriving from changes in the estimates made is
charged to profit or loss.
It should be noted that the valuation of the severance indemnity based on IAS 19 concerned
IWB S.p.A., Giordano Vini S.p.A. and Enoitalia S.p.A. whose financial statements and reporting
packages are respectively drawn up on the basis of IAS / IFRS and did not impact Provinco Italia
S.p.A .; the effect on this company is estimated not to be significant.
Salary benefits in the form of equity participation
The Group also remunerates its top management through stock grant plans. In such cases, the
theoretical benefit attributed to the parties concerned is debited to profit or loss in the years
covered by the plan, with a balancing entry in the shareholders' equity reserve. This benefit is
quantified by measuring the fair value of the assigned instrument at the assignment date using
financial valuation techniques, including any market conditions and adjusting the number of
rights that are expected to be assigned at each reporting date.
Provisions for future risks and charges
These are provisions arising from current obligations (legal or implicit) and relating to a past
event, for the fulfilment of which it is probable that an outlay of resources will be necessary,
the amount of which can be reliably estimated. If the expected use of resources goes beyond
the next financial year, the obligation is recorded at its present value determined by
discounting the expected future cash flows discounted at a rate that also takes into account
the cost of money and the risk of the liability.
Provisions are reviewed at each reporting date and, if necessary, adjusted to reflect the best
current estimate; any changes in estimate are reflected in profit or loss for the period in which
the change occurred.
Risks for which the occurrence of a liability is only possible are mentioned in the notes without
making any provision.
Revenue from sales
Revenues are recognized to the extent that it is probable that economic benefits will flow to
the entity and the amount can be measured reliably. Revenues are recognized net of discounts,
allowances and returns.
Revenues from the distance selling division are recognized when the carrier delivers them to
the customer. Revenues from the sale of wine, food products and gadgets are recognized as a
single item.
The distance selling division accepts, for commercial reasons, returns from customers for
distance selling under the terms of sale. In relation to this practice, the amounts invoiced at
the time of shipment of the goods are adjusted by the amounts for which, even on the basis
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of historical experience, it can reasonably be expected that at the reporting date not all the
significant risks and rewards of ownership of the goods have been transferred. The returns
thus determined are stated in profit or loss as a reduction in revenues.
Interest income
Interest income is recorded in profit or loss on an accruals basis according to the effective rate
of return method. These mainly refer to bank current accounts.
Public grants
Public grants are recorded when there is a reasonable certainty that they can be received (this
moment coincides with the formal resolution of the public bodies granting them) and all the
requirements of the conditions for obtaining them have been met.
Revenues from public grants are recognized in profit or loss based on the costs for which they
were granted.
Dividends
The distribution of dividends to shareholders, if resolved, generates a debt at the time of
approval by the Shareholders' Meeting.
Cost recognition
Selling and marketing expenses are recognized in profit or loss at the time they are incurred or
the service is rendered.
Costs for promotional campaigns, mailings or other means are charged at the time of shipment
of the material.
Non-capitalizable research and development costs, consisting solely of personnel costs, are
expensed in the period in which they are incurred.
Interest charges
Interest expense is recognized on an accruals basis, based on the amount financed and the
effective interest rate applicable.
Taxes
Taxes for the period represent the sum of current and deferred taxes.
Current taxes are based on the taxable income for the period. Taxable income differs from the
result reported in profit or loss in that it excludes positive and negative components that will
be taxable or deductible in other years and also excludes items that will never be taxable or
deductible. Current tax liabilities are calculated using the rates in force at the reporting date,
or if known, those that will be in force at the time the asset is realized or the liability is
extinguished.
Deferred tax assets and liabilities are the taxes that are expected to be paid or recovered on
temporary differences between the carrying amount of assets and liabilities in the statement
of financial position and the corresponding tax value used in the calculation of taxable income,
accounted for using the full liability method. Deferred tax liabilities are generally recognized
for all taxable temporary differences, while deferred tax assets are recognized to the extent
that it is probable that there will be taxable results in the future that will allow the use of
deductible temporary differences. These assets and liabilities are not recognized if the
temporary differences arise from goodwill or the from initial recognition (not in business
combination transactions) of other assets or liabilities in transactions that have no influence
on either the accounting result or the taxable result. The tax benefit deriving from the carry-
forward of tax losses is recognized when and to the extent that it is considered probable that
future taxable income will be available against which these losses can be used.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to
the extent that it is no longer probable that sufficient taxable income will exist to permit the
recovery of all or part of those assets.
Deferred taxes are calculated based on the tax rate that is expected to be in force when the
asset is realized or the liability is settled.
Deferred taxes are charged directly to profit or loss, with the exception of those relating to
items recognized directly in equity, in which case the related deferred taxes are also charged
to equity.
Financial assets measured at fair value through other comprehensive income (FVOCI)
This category includes equity instruments for which the Group - at the time of initial
recognition or at the time of transition - has exercised the irrevocable option to present the
profits and losses deriving from fair value changes in shareholders' equity (FVOCI). These are
classified as non-current assets under "Other financial assets at fair value through other
comprehensive income".
These are initially recognized at fair value, including transaction costs directly attributable to
the acquisition.
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They are subsequently measured at fair value, and gains and losses arising from changes in fair
value are recognized in a specific equity reserve. This reserve will not be reflected in profit or
loss. In the event of disposal of the financial asset, the amount suspended at equity is
reclassified to retained earnings.
Dividends deriving from these financial assets are recorded in profit or loss at the time when
the right to collection arises.
Financial assets at fair value through profit or loss (FVPL)
This valuation category comprises:
- equity instruments for which the Group - at the time of initial recognition or at the
time of transition - did not exercise an irrevocable option to present the profits and
losses deriving from changes in fair value in shareholders' equity. These are classified
as non-current assets under "Other financial assets at fair value through profit or loss";
- debt instruments for which the Group's business model for asset management
provides for the sale of the instruments and the cash flows associated with the
financial asset represent the payment of outstanding capital. These are classified as
current assets under "Other financial assets at fair value through profit or loss";
- derivative instruments, with the exception of those designated as hedging
instruments, classified under the item "derivative financial instruments".
These are initially recognized at fair value. Transaction costs directly attributable to the
acquisition are recognized in profit or loss. They are subsequently measured at fair value, and
gains and losses arising from changes in fair value are recognized in profit or loss.
Derivative financial instruments designated as hedging instruments
In line with the provisions of IFRS 9, derivative financial instruments are accounted for in
accordance with the procedures established for hedge accounting only when:
- the items covered and the hedging instruments meet the eligibility requirements;
- at the beginning of the hedging relationship, there is a formal designation and
documentation of the hedging relationship, the Group's risk management objectives
and the strategy for hedging;
- the hedging relationship meets all of the following efficacy requirements:
- there is an economic relationship between the hedged item and the hedging
instrument;
- the effect of credit risk is not dominant with respect to the changes associated
with the hedged risk;
- the hedge ratio defined in the hedging relationship is met, including through
rebalancing actions, and is consistent with the risk management strategy adopted
by the Group.
These derivative instruments are measured at fair value.
Depending on the type of hedge, the following accounting treatments are applied:
- Fair value hedge - if a derivative financial instrument is designated as a hedge of
exposure to changes in the fair value of an asset or liability attributable to a particular
risk, the gain or loss from subsequent changes in the fair value of the hedging
instrument is recognized in profit or loss. The gain or loss on the hedged item, for the
part attributable to the hedged risk, modifies the carrying amount of that asset or
liability (basis adjustment) and is also recognized in profit or loss;
- Cash flow hedge - if a derivative financial instrument is designated as a hedge of the
exposure to variability in cash flows of a recognized asset or liability or a highly
probable future transaction, the effective portion of the change in fair value of the
hedging derivative is recognized directly in equity, while the ineffective portion is
recognized immediately in profit or loss. Amounts that have been recognized directly
in equity are reclassified to profit or loss in the year in which the hedged item has an
effect on profit or loss.
If the hedge of a highly probable future transaction subsequently results in the recognition of
a non-financial asset or liability, the amounts that are suspended in equity are included in the
initial value of the non-financial asset or liability.
Fair value estimation
The fair value of financial instruments listed on an active market is determined on the basis of
market prices at the reporting date. The reference market price for financial assets held is the
current sale price (purchase price for financial liabilities).
The fair value of financial instruments that are not traded on an active market is determined
using various valuation techniques and assumptions based on market conditions at the
reporting date. For medium and long-term liabilities, the prices of similar listed financial
instruments are compared; for the other categories of financial instruments, the cash flows
are discounted.
The fair value of IRSs is determined by discounting the estimated cash flows deriving from
them at the reporting date. For loans, it is assumed that the nominal value, net of any
adjustments made to take int account their collectability, approximates the fair value. The fair
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value of financial liabilities for disclosure purposes is determined by discounting the cash flows
from the contract at an interest rate that approximates the market rate at which the entity is
financed.
3 Fair value measurement
In relation to financial instruments measured at fair value, the classification of these
instruments based on the hierarchy of levels provided for by IFRS 13 is shown below, which
reflects the significance of the inputs used in determining fair value. The following levels can
be distinguished:
Level 1 - unadjusted quotations recognized on an active market for the assets or liabilities being
measured;
Level 2 - inputs other than the quoted prices mentioned in the previous point, which are
observable on the market, either directly (as in the case of prices) or indirectly (i.e., derived
from prices);
Level 3 – inputs that are not based on observable market data.
There are no assets or liabilities outstanding that are measured at fair value at 30 June 2021.
3.1 Financial risks
The Group is mainly exposed to financial risks, credit risk and liquidity risk.
Risks deriving from exchange rate fluctuations
The Group is subject to the market risk deriving from exchange rate fluctuations, as it operates
in an international setting, with transactions carried out in different currencies. Exposure to
risk arises both from the geographical distribution of the business and from the various
countries in which purchases are made.
Risks deriving from changes in interest rates
Since financial debt is mainly regulated by variable interest rates, it follows that the Group is
exposed to the risk of their fluctuation. The trend of interest rates is constantly monitored by
the Company and depending on their changes it will be possible to evaluate the opportunity
to adequately hedge the interest rate risk. The Group is currently not hedged, considering the
insignificant impact on the income statement of interest rate changes.
Derivative financial instruments (for exchange rate hedging) in relation to which it is not
possible to identify an active market, are recorded at fair value and are included in the items
of financial assets and liabilities and other assets and liabilities. The relative fair value was
determined using valuation methods based on market data, in particular by using specific
pricing models recognized by the market.
Credit risk
Credit risk is the Group’s exposure to potential losses that may result from the failure to meet
obligations with counterparts.
The receivables recorded essentially comprise receivables from final consumers for whom the
risk of nonrecovery is moderate and in any case of a minimum individual amount. The
Company has instruments for the preventive control of the solvency of each customer, as well
as instruments for monitoring and reminding of receivables through the analysis of collection
flows, payment delays and other statistical parameters.
Liquidity risk
The Group finances its activities both through the cash flows generated by its operations and
through the use of external sources of funding and is therefore exposed to liquidity risk,
represented by the fact that its financial resources are not sufficient to meet its financial and
commercial obligations in accordance with agreed terms and maturities. The Group's cash
flows, borrowing requirements and liquidity are controlled by considering the maturity of
financial assets (trade receivables and other financial assets) and the cash flows expected from
the related transactions. The Group has both secured and unsecured credit lines, consisting of
revocable short-term credit lines in the form of revolving loans, current account overdrafts and
signature loans.
Default and covenant risk on debt
This risk arises from the presence in loan agreements of provisions that, if certain events were
to occur, would entitle the counterparties to demand that the borrower repay immediately
the loaned amounts, thereby generating liquidity risk.
In detail, following the issue of the senior bond loan, non-convertible, unsubordinated and
unsecured, with a total nominal value of Euro 130,000,000, called "Italian Wine Brands S.p.A.
up to Euro 130,000,000 2.5% Senior Unsecured Fixed Rate Notes due 13 May 2027 " financial
covenants have been defined based on the performance of some parameters at the Group
consolidated level, the measurement of which is expected starting from 31 December 2021.
The parameters defined following the full refinancing of the debt attributable to the subsidiary
61 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
61 |
Giordano Vini SpA which took place in July 2017, no longer existed following the repayment of
the loan which took place on 18 June 2021
Operational and management risks
The Group neither manages nor owns vineyards and purchases the raw materials necessary
for the production of wines (grapes, must and bulk wine) directly from third-party producers.
The market trend of these raw materials, which are natural products, largely depends on the
results of the harvests, which in turn are influenced, in quantitative and qualitative terms, by
climatic, phytopathological or polluting factors. Although the Group has adopted a flexible
purchasing system based on the purchase of raw materials from year to year in the main Italian
wine-making regions according to harvest trends and has developed consolidated
relationships with suppliers, it cannot be excluded that particularly poor harvests may lead to
a significant increase in the prices of raw materials or make it more difficult to obtain grapes,
musts and bulk wine in the quantities and qualities needed to sustain customer demand.
Moreover, the Group's catalogue is mainly composed of DOC, DOCG and IGT wines and the
negative trend in harvests could affect the Group's ability to continue to maintain a basket of
products centered on wines with these characteristics. These circumstances could have a
negative effect on the Group's economic and financial situation.
Accounting standards
4.1 Accounting standards adopted
The accounting standards adopted are the same as those used for the preparation of the
consolidated financial statements at 31 December 2020 except for the following new
standards or amendments to existing standards, details of which are provided in the
paragraphs below.
Accounting standards, amendments and interpretations endorsed and effective from 1
January 2021
x Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4, and IFRS 16 (Reference interest rate reform
– IBOR reform – phase 2)
These amendments relate to how the impacts of replacing the current benchmark interest
rates with alternative interest rates are to be managed, specifically:
o The introduction of a practical expedient for accounting for changes in the basis on
which contractual cash flows of financial assets and liabilities are calculated;
o The introduction of certain exemptions related to the termination of coverage
relationships;
o temporary exemption from the requirement to separately identify a risk component
(where such separate hedged component is represented by alternative interest rates);
o The introduction of some additional disclosures regarding the impacts of the reform.
These amendments had no impact on the Group’s financial statements because the
potentially impacted instruments are expected to expire before the transition to the new
IBOR.
Amendements to IFRS 16 - Leases – fee reductions related to Covid-19.
These changes extend by one year the possibility of applying an optional accounting treatment
for tenants in the presence of reductions in permanent rent (rent holidays) or temporary rents
linked to Covid-19. The changes were to be applicable until June 30, 2021, but as the impact
of the pandemic continues, that option was extended until June 30, 2022.
Lessees can choose to account for rent reductions as variable lease payments recognized
directly in the income statement for the period in which the reduction applies, or treat them
as a modification of the lease agreement with the consequent obligation to remeasure the
lease payable based on of the revised consideration using a revised discount rate. The Group
expects to apply this optional accounting treatment should the case occur within the permitted
application period.
There are no impacts on the Group's financial statements following the extension of this
optional accounting treatment, as the Group has not received concessions on lease payments
related to Covid-19.
International accounting standards and/or interpretations issued but not yet effective in
2021
The new standards or interpretations already issued, but not yet effective or not yet
approved by the European Union at 30 June 2021 and therefore not applicable are
indicated below. At the current valuation stage, no impact on the classification of financial
liabilities is expected as a result of these amendments.
.
x Amendments to IAS 1 - Presentation of Financial Statements - Classification of Liabilities
as Current or Non-current
63 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
63 |
The amendments clarify the principles to be applied for the classification of liabilities as
current or non-current and specify that the classification of a liability is not affected by the
likelihood that the Group will exercise its right to defer settlement of the liability for at
least twelve months after the reporting period. The Group’s intention to liquidate in the
short term does not impact the classification. These amendments, which will take effect
on 1 January 2023, have not yet been endorsed by the European Union. At the current
valuation stage, no impact on the classification of financial liabilities is expected as a result
of these amendments.
x Amendments to IAS 16 - Property, plant and equipment - Proceeds before Intended Use
These amendments prohibit the deduction of proceeds from selling items from property,
plant and equipment while the item is being prepared for its intended use. The proceeds
from the sale of the products, and the related cost of production, must be recognised in
profit or loss. These amendments, which will take effect on 1 January 2022, have not yet
been endorsed by the European Union. At the current valuation stage, no impact on the
classification of financial liabilities is expected as a result of these amendments.
Amendments to IAS 37 - Provisions, Contingent Liabilities and Contingent Assets -
Onerous Contracts — Cost of Fulfilling a Contract
These amendments specify the costs to be taken into account when assessing onerous
contracts and specify that the “directly related costs” approach must be applied.
These amendments, which will take effect on 1 January 2022, have not yet been endorsed
by the European Union. At the current valuation stage, no impact on the classification of
financial liabilities is expected as a result of these amendments.
x Annual Improvements (2018 - 2020 cycle) issued in May 2020
These amendments are limited to certain standards (IFRS 1 First-time Adoption of IFRS,
IFRS 9 Financial Instruments, IAS 41 Agriculture and illustrative examples of IFRS 16 Leases)
which clarify the wording or correct omissions or conflicts between IFRS standards. These
amendments, which will take effect on 1 January 2022, have not yet been endorsed by the
European Union. At the current valuation stage, no impact on the classification of financial
liabilities is expected as a result of these amendments.
x Amendments to IAS 1 - Presentation of Financial Statements and IFRS Practice Statement
2: Disclosure on accounting standards
These amendments provide guidance for applying materiality judgments to accounting policy
disclosures in a way that is more useful; specifically:
• the obligation to indicate the “significant” accounting policies has been replaced with
the obligation to indicate the “material” ones;
• guidance has been added on how to apply the concept of materiality to accounting
policy disclosures.
In assessing the materiality of accounting policy disclosures, entities should consider both the
size of the transactions, other events or conditions, and their nature.
These amendments, which will take effect on 1 January 2023, have not yet been endorsed by
the European Union. At the current valuation stage, no impact on the classification of financial
liabilities is expected as a result of these amendments.
x Amendments to IAS 8 – Accounting Policies, Changes in Accounting Estimates and Errors
These amendments introduce a new definition of “accounting estimates,” particularly in terms
of the difference between accounting estimates and accounting policies and provide guidance
on determining whether changes should be treated as changes in estimates, changes in
accounting principles, or errors.
These amendments, which will take effect on 1 January 2023, have not yet been endorsed by
the European Union. At the current valuation stage, no impact on the classification of financial
liabilities is expected as a result of these amendments.
x Amendments to IAS 12 – Income Taxes – Deferred Tax related to Assets and
Liabilities arising from a Single Transaction
These amendments eliminate the possibility of not recognising deferred taxes upon initial
recognition of transactions that give rise to taxable and deductible temporary differences (e.g.,
lease agreements).
These amendments also clarify that when lease payments are deductible for tax purposes, it is
a matter of judgment (after considering applicable tax law) whether such deductions are
attributable for tax purposes to the lease liability recorded on the balance sheet or to the
65 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
65 |
related right-of-use. If tax deductions are attributed to the right-of-use, the tax bases of the
right-of-use and lease liability are the same as their carrying amounts, and no temporary
differences arise upon initial recognition. However, if tax deductions are attributed to the lease
liability, the tax values of the right-of-use and lease liability are nil, giving rise to taxable and
deductible temporary differences, respectively. Even if the gross temporary differences are
equal, a deferred tax liability and a deferred tax asset must still be recognised.
These amendments, which will take effect on 1 January 2023, have not yet been endorsed by
the European Union. Impacts on the Group's financial statements following these amendments
are currently being analysed.
Notes
5. Intangible fixed assets
Intangible fixed assets refer almost entirely to the trademarks owned by the Group. The
changes are shown below:
The item “Trademarks and patents” indicated consists of the trademark Giordano Vini,
consisting of the value resulting from the merger of Ferdinando Giordano S.p.A. into Giordano
Vini S.p.A. (formerly Alpha S.r.l.) carried out in previous years. Also included are the trademarks
owned by Provinco Italia S.p.A., amounting to €8,586 thousand, valued at the time of allocation
of the purchase price in accordance with IFRS 3.
These trademarks are identified as having an indefinite useful life and, consequently, are not
amortized but tested for impairment annually, as is the case for goodwill. The carrying amount
is unchanged from that of the Consolidated Annual Financial Report at 31 December 2020 in
line with that used for the purposes of goodwill, for which reference should be made to the
next paragraph.
The increases in the year 2021 essentially relate to the development of the following
computerization processes that involved the company Giordano Vini S.p.A .:
x implementation of websites and start of operations in new countries (UK and Germany
also through the Svinando platform) and in support of the new Ho.Re.Ca channel for
the subsidiary Giordano Vini S.p.A
x development of the customer base through targeted acquisition through successful
marketing campaigns ("CPA");
x sw for the automation of the bottling lines
x introduction of new accounting ERPs and a software for the control of payments
functional to the assessment of solvency and reminder of overdue receivables (VAD)
for the subsidiary Giordano Vini Spa.
Euro thousand
INTANGIBLE FIXED ASSETS
Net Carrying amount
Net carrying amount
01/01/2021 increases decreases amortizations reclassification
increases from
business
combination
31/12/2021
Trademarks & patents
29.810 46 - (57) - 517
30.316
Software
774 307 (5) (610) 1.255 64
1.786
Other intangibles assets
3.030 337 (2) (1.486) 1.719 69
3.666
Intangible assets under const
391 2.798 - - (2.974) -
216
Net carrying amount intang
34.005 3.488 (7) (2.154) - 650 35.983
67 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
67 |
6. Goodwill
The overall total goodwill - equal to Euro 181,085 thousand - arises from the following
business combinations: Provinco Italia S.p.A. for Euro 11,289 thousand; Giordano Vini S.p.A.
for Euro 43,719 thousand; Pro.Di.Ve. S.r.l. for Euro 447 thousand; Raphael Dal Bo AG for Euro
12,854; Enoitalia SpA for Euro 112,776 thousand, the latter occurring in July 2021.
At December 31, 2021, goodwill and intangible assets with an indefinite useful life were
subjected to an impairment test, which consists of estimating the recoverable value of the
CGUs, that for IWB are subsidiaries controlled entities, and comparing them it with the net
book value of the related assets, including goodwill.
The value in use corresponds to the present value of future cash flows that are expected to
be associated with the assets subject to impairment, using a rate that reflects the specific
risks of the individual CGUs at the valuation date.The key assumptions used by management
are the estimate of future increases in sales, operating cash flows, the growth rate of terminal
values and the weighted average cost of capital (discount rate).
At 31 December 2021, the recoverable value of the cash-generating unit was subjected to
impairment tests in order to verify the existence of any losses in value, by comparing the book
value of the unit (including goodwill , intangible assets with a finite useful life and other net
operating assets) and the value in use, or the present value of the expected future cash flows
that are supposed to derive from the continuous use and possible disposal of the same at the
end of its life useful.
The value in use was determined by discounting the cash flows in line with the economic and
financial forecasts prepared by the companies. In order to determine the value in use of the
CGU, the discounted cash flows of the 5 years of explicit projection for the company Enoitalia
S.p.A. and 3 years for the other companies of the group are considered added to a terminal
value, “valuated” through the discounting perpetuity method.
These is plans wereas drawn up both by reflecting the past experience of the companies and
by appropriately evaluating the current economic situation. The assumptions made in
forecasting cash flows in the explicit projection period were made on prudential assumptions.
• The discount rate (WACC, weighted average cost of capital) applied to forecast cash flows
is 6.5% post tax, calculated taking into consideration the sector in which the company
operates, the fully operational debt structure and the current economic situation
• For the cash flows relating to the years subsequent to the explicit projection period, a rate
of 1.5
Consistently with the requirements of IAS 36, the Group carried out a sensitivity analysis to
verify whether a reasonably possible change in a basic assumption on which the Management
based the determination of the recoverable value of the CGU, could cause the carrying
amount of the CGU itself exceeds the recoverable value.
At December 31, 2021, there were no losses in value between the book value and the relative
value in use (determined according to the Discounted Cash Flow method).
7. Land, property, plant and equipment
The change in tangible fixed assets is shown below:
The most significant increase from the point of view of actual acquisitions concerns the items:
- Plant and machinery - main investments: automation and digitalization on the bottling line
(279 thousand euros), as part of the industry 4.0 projects, end-of-line printers, double filter
with redosing (340 thousand euros), electrical system with new line layout F3 bottling (Euro
102 thousand), continuous tunnel heater (Euro 143 thousand)
- Equipment - for investments relating to laboratory equipment (Euro 126 thousand);
autoclaves of 2,200 hl each (900 thousand euros).
- Increase for usage rights refers to the renewal of the lease contract for the Provinco Italia
SpA headquarters pursuant to IFRS 16
Euro thousand
PROPERTY, PLANT AND EQUIPMENT
Gross Value
Hystorical costs
01/01/2021 increases decreases
reclassification/oth
er changes
increases from
business
combinations
31/12/2021
Land and buildings
13.105 344 (45) 0 21.678 35.082
Plant and equipments
17.315 1.570 (494) 1.179 32.566 52.136
Equipment
729 1.026 0 0 9.027 10.782
Other
5.107 133 (8) 8 1.059 6.298
Tangible assets under construction and
1.156 49 0 (1.185) 3 23
Right of use assets
12.055 616 0 0 7.683 20.354
Total hystorical costs
49.466 3.737 (547) 2 72.016 124.675
PROPERTY, PLANT AND EQUIPMENT
Accumulated depreciation
Accumulated depreciation
01/01/2021 amortization divestments other changes
increases from
business
combinations
31/12/2021
Land and buildings
(3.874) (819) 2 0 (4.806) (9.497)
Plant and equipments
(13.277) (1.741) 255 0 (18.955) (33.717)
Equipment
(592) (366) 0 0 (4.414) (5.372)
Other
(4.566) (224) 8 0 (828) (5.610)
Tangible assets under construction and
000000
Right of use assets
(2.418) (1.645) 0 0 (2.250) (6.312)
total accumulated depretiation
(24.727) (4.794) 266 - (31.253)
(60.508)
PROPERTY, PLANT AND EQUIPMENT
Net Value
Net Value 01/01/2021 increases divestments amortization other changes 31/12/2021
Land and buildings
9.231 344 (43) (819) 16.872
25.585
Plant and equipments
4.038 1.570 (238) (1.741) 14.790
18.419
Equipment
136 1.026 - (366) 4.613
5.410
Other
541 133 - (224) 239
688
Tangible assets under construction and
1.156 49 - - (1.182)
23
Right of use assets
9.637 616 - (1.645) 5.433
14.042
Total Net Value
24.740 3.737 (281) (4.794) 40.765
64.166
69 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
69 |
The increases from business combinations refer to the direct acquisitions of Enoitalia S.p.A.
and consist of:
- Production plant and office building in Calmasino di Bardolino (VR): approximately 8,765
square meters covered on an area of 50,000 square meters. The plant is equipped with a cellar
for winemaking, and 4 bottling lines for a production capacity of 28,000 bottles / hour
- Production plant in Montebello Vicentino (VI), of about 26,000 square meters, located on an
area of 46,000 square meters. The plant is equipped with state-of-the-art winemaking, bottling
and storage systems. There are in particular 3 bottling lines, with a total production capacity
of 34,000 bottles / hour, two of which are suitable for the bottling of sparkling wines and an
automatic finished product warehouse (LGV).
- Finished product warehouse of about 5,200 square meters in Cason (VR), located on an area
of 9,000 square meters.
- Rental contracts stipulated by Enoitalia SpA which increase the amount of the rights of use
Equity investments
Equity investments, almost entirely attributable to the company Giordano Vini S.p.A., are
detailed as follows:
Amounts in Euro
Country
31.12.2021 31.12.2020
Other companies
BCC di Alba e Roero Italy 258 258
Consorzio Conai Italy 675 670
Unione Italiana Vini Scarl Italy 516 258
Consorzio Natura è Puglia Italy 500 500
Consorzio Granda Energia Italy 517 517
Banca Alpi Marittime C.C. Carrù Scpa Italy 293 293
Garzan Italy 100
Total 2.859 2.496
9. Other non current activities
This item include Euro 178 migliaia for IRAP (regional business tax) receivable in relation to
labour costs pursuant to Italian Decree Law No. 201 of 2011 and Euro 2.149 for security deposit
(of which Enoitalia Euro 2.100 thousands).
10. Deferred Taxes
Deferred tax assets and liabilities arise from the following temporary differences:
Amounts at 31 december 2021
Euro thousand
Description
Imponibile Aliquota
Saldo
Provision for risks and charges
100 24,00% 24
Provisions for returs and inventory write down
1.287 27,90% 359
Non capitalisable long term charges for IFRS
purposes
140 27,90%
39
Provision for bads debts
3.738 24,00% 897
Remuneration of directors
536 24,00% 129
Provision for pensions
132 27,90% 37
Others
129 24,00% 31
Total Deferred tax assets 1.516
Description
Business combination/Goodwill
8.584 27,90% 2.395
Tangible and intangible fixed assets
26.710 27,90% 7.452
Exchange rate adjustment
158 24,00% 38
Others
338 24,00% 81
Total Provision for deferred taxes 9.966
71 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
71 |
11. Inventories
The inventories are detailed below:
Amounts at 31 December 2020
€thousand
Description
Tax base Tax rate
Balance
Tangible and intangible fixed assets
853 27,90% 238
Provision for risks and charges 131 24,00% 31
Provisions for returns and inventory write-
downs
1.461 27,90%
408
Non-deductible interest expense 1.060 24,00% 254
Non-capitalisable long-term charges for IFRS
purposes
140 27,90%
39
Provision for bad debts 2.307 24,00% 554
Remuneration of directors 1.001 24,00% 240
Exchange rate adjustment 24,00% 0
Provisions for pensions 136 27,90% 38
Others 183 24,00% 44
Total deferred tax assets 1.846
Description
Business combinations / Goodwill 5.639 27,90% 1.573
Tangible and intangible fixed assets 29.703 27,90% 8.286
Exchange rate adjustment 24 24,00% 6
Others 38 24,00% 9
Total provision for deferred taxes 9.874
Euro thousand
31.12.2021 31.12.2020
Raw materials and consumables 8.192 2.010
Semi- finished products 43.743 16.144
Finished products 24.342 7.316
Advances 1.631 20
Total 77.908 25.490
Individual items include:
- components for the production of bottles (glass, caps and labels), packaging, wine
products (raw materials);
- food, bulk and bottled wine, liqueurs (semi-finished products);
- packaging and gadgets (finished products).
The increase compared to 31/12/20 included 46.204 euro thousand due to Enoitalia S.p.A.
inventory.
The carrying amount of the inventories is shown net of a provisions for bad debts of €1,6
million, the changes of which in the period are shown below:
Euro thousand
Provision at 1.1.21
1.736
Provisions
50
Increase from business combination
-
Amount used
(172)
Provision at the end of the period
1.614
- Uses mainly refer to the disposal of food products that have reached their expiry date.
12.Trade receivables
Trade receivables at 31 December 2020 and 31 December 2021 are detailed below:
During 2021, the provision for bad debts changed as follows:
€thousand
31.12.2021 31.12.2020
Trade receivables 72.482 33.057
Provision for writedown (4.338) (2.490)
Total 68.144 30.567
73 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
73 |
Provisions were made based on the estimated realizable value of the receivables, also in light
of the possible risks of total or partial non-recoverability thereof and according to economic
and statistical criteria, in compliance with the principle of prudence. In addition, the provisions
are deducted from the total of the item on a lump-sum and indistinct basis.
Specifically, the criterion adopted for the write-down of receivables relating to the “Distance
Selling Division” is based on an analysis of the "stage of credit reminder"; the variables of this
analysis is the reminder time after the receivable has become due and the percentage of
reduction linked to each geographical area based on the statistical analysis of the probability
of recovering the amount.
There are no receivables with a contractual duration of more than 5 years.
13 Other assets
Other assets at 31 December 2020 and 31 December 2021 are detailed in the following table:
The "others" item mainly includes receivables vs factor (Enoitalia) for €766 thousand.
€thousand
31.12.2021 31.12.2020
Initial amount 2.490 2.975
Provisions 1.155 1.409
Increase from business combination 825 48
Amounts used (132) (1.943)
Fondo alla fine del periodo 4.338 2.490
€thousand
31.12.2021
31.12.2020
Receivables from distributors for cash on deliv
179 158
Security deposits 435 384
Others 1.149 362
Advances to suppliers 301 46
Accruals and prepayments 332 452
Total 2.396 1.402
14 Current tax assets
Tax receivables at 31 December 2020 and 31 december 2021 are detailed in the following
table:
With effect from the 2016 period, the Parent Company (together with its subsidiaries Giordano
Vini S.p.A. and Provinco Italia S.p.A.) has opted for the national IRES tax consolidation scheme,
the effects of which are also reported in the economic and financial results at 30 June 2021.
Participation in tax consolidation is governed by specific regulations that apply throughout the
period of validity of the option.
The economic relations of tax consolidation are summarized below:
- for the years with positive taxable income, the subsidiaries pay to the consolidating
company the higher tax it owes to tax authorities;
- consolidated companies with negative taxable income receive from the parent
company a compensation corresponding to 100% of the tax savings realized at Group
level and recorded on an accrual basis. Compensation is paid only when it is actually
used by the Parent Company, for itself and/or for other companies in the Group;
- in the event that the Parent Company and its subsidiaries do not renew the option for
national consolidation, or in the event that the requirements for continuing national
consolidation are no longer met before the end of the three-year period of validity of
the option, the tax losses carried forward resulting from the tax return are attributed
to the consolidating company or entity.
Enoitalia SpA wiil join Tax consolidation scheme starting from December 31, 2022.
€thousand
31.12.2021 31.12.2020
VAT receivables 5.009 2.095
Tax Credit 2.368
Others 25 1
Total 7.402 2.096
75 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
75 |
15. Cash and cash equivalents
A breakdown of cash and cash equivalents at 31 December 2020 and 31 december 2021 is
provided in the table below:
16 Shareholders' equity
The company's shareholders' equity is made up as follows:
€thousand
31.12.2021 31.12.2020
Bank deposits 56.346 30.495
Postal deposits 2.320 2.567
Cheques 403 283
Cash 35 57
Total 59.103 33.402
Amounts in EUR
31.12.2021 31.12.2020
Share capital 1.046.266 879.854
Legal reserve 175.971 175.971
Share premium reserve 109.899.034 64.565.446
Reserve for actuarial gains on defined benefit plans (77.633) (66.778)
Reserve for stock grants 518.220 739.278
Reserve for translate 196.117 (19.934)
Reserve for the purchase of treasury shares - (582.570)
Other reserves 2.899.133 2.888.974
Prior profits/(losses) 30.760.201 21.747.715
Profit/(loss) of the period 14.537.077 14.192.552
Total reserves 158.908.120 103.640.655
Total Group shareholders’ equity 159.954.386 104.520.509
Shareholders’ equity of NCIs - -
Total shareholders’ equity 159.954.386 104.520.509
Share capital
The share capital of Italian Wine Brands is equal to €1.046.265,80 divided into 8,802,077
ordinary shares, all without indication of the nominal value.
The extraordinary Shareholders' Meeting of 26 July 2022 of Italian Wine Brands S.p.A. has
approved, on second call, the proposed non divisible capital increase against payment, for a
total amount of Euro 45,500,000.00 (of which Euro 166,412.10 as capital and Euro
45,333,587.90 as share premium) (the "Reserved Capital Increase"). The Reserved Capital
Increase provides for the issue of a total of no. 1,400,000 new ordinary shares without nominal
value, at a subscription price of Euro 32.50 (including share premium), with the exclusion of
option rights pursuant to Article 2441, Paragraph 5 of the Italian Civil Code, to be reserved for
subscription by Gruppo Pizzolo S.r.l. ("Gruppo Pizzolo") and to be paid in cash, also by means
of compensation.
The Reserved Capital Increase will be carried out in the context of an investment transaction
of IWB, which provides for the acquisition by the Company of the entire share capital of
Enoitalia S.p.A. and the reinvestment by Gruppo Pizzolo, the majority shareholder of Enoitalia,
in the share capital of IWB by means of the subscription and payment in cash, also by way of
compensation, of the Reserved Capital Increase.
The deal was finalized on 27 July 2021.
Reserves
The share premium reserve was generated as a result of listing that took place in 2015 and
increased in 2021 as a result of the capital increase as described in the previous paragraph.
The reserve for defined-benefit plans is generated by the actuarial profits/(losses) deriving
from the valuation of the accrued termination benefits in accordance with IAS 19.
Other reserves include €3,112 thousand in the reserve for transactions "under common
control" generated by the first consolidation of the company Giordano Vini S.p.A. during the
first half of 2015, net of a negative reserve of €498 thousand generated by the direct
recognition in equity, in accordance with IAS 32, of the expenses incurred by the parent
company in relation to the aforementioned capital transactions net of the related deferred
taxes.
At 31 December 2021 the Parent Company held 6.092 ordinary shares, representing 0.08% of
the ordinary share capital in circulation.
The reconciliation schedule between the shareholders' equity and the result of the parent
company and those of the consolidated companies is set out below:
77 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
77 |
Amounts in EUR
Risultato
dell'esercizio
Patrimonio
netto
Shareholders' equity IWB SpA - ITA GAAP standards
Differences in accounting standards
9.779.891
130.486.543
Shareholders' equity IWB SpA - IFRS standards
Elimination of carrying amount of consolidated equity investments:
-
(204.755.982)
Amortisation of consolidation difference
19.725.673
219.920.161
Pro-quota share of consolidated equity investments net of consolidation
differences
(14.235.857)
-
Dividends from subsidiaries
(732.630) (233.412)
Consolidation adjustments for transactions between consolidated companies
14.537.077
145.417.309
Group shareholders' equity and profit/(loss) for the period
- -
14.537.077 145.417.309
Consolidated shareholders' equity and profit/(loss)
31 dicembre 2021
17. Financial liabilities
The situation al 31 december 2021 is te following:
The statement of Group Financial payables at 31 december 2020 is given below for comparable
purposes:
The table below shows the changes in financial liabilities
€thousand
31.12.2021
Short term
Medium/long
term (within 5
years)
Long term (over
5 years)
Total
Bond - - 130.795 130.795
Pool financing - Senior - - - -
Short-term unsecured loans 15.642 - - 15.642
GV revolving loans 16.000 - - 16.000
Other loans in addition to e.g. unsecured loans 576 4.931 - 5.507
Financial accrued expenses and charges to be settled 239 - - 239
Total Banks 32.457 4.931 - 37.388
Payables to factoring companies
10 - - 10
10 - - 10
Total 32.467 4.931 130.795 168.193
€thousand 31.12.2020
Short term
Medium/long
term (within 5
years)
Long term (over
5 years)
Total
Pool financing - Senior 3.250 13.050 - 16.300
Short-term unsecured loans 1.500 - - 1.500
GV revolving loans 2.000 7.000 - 9.000
Other loans in addition to e.g. unsecured loans 1.400 3.757 - 5.157
Financial accrued expenses and charges to be settled 65 - - 65
Total Banks 8.215 23.807 - 32.022
Payables to factoring companies - - - -
Deferred price acquisition of Raphael Dal Bo AG 1.861 - - 1.861
Total other lenders 1.861 - - 1.861
Total 10.076 23.807 - 33.883
79 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
79 |
The bank debt as of December 31, 2021 consists of the following loans:
• Senior bond, non-convertible, unsubordinated and unsecured, of Euro 130 million issued by
Italian Wine Brands S.p.A. on May 13, 2021 with a duration of 6 years (maturity May 13, 2027),
bullet repayment, annual fixed rate of 2.50%, annual interest. The bond loan is listed on the
MOT market managed by Borsa Italiana and on the Irish Stock Exchange managed by Euronext
Dublin.
• Revolving medium-term loan granted on 30 July 2021 to the subsidiary Giordano Vini S.p.A.
by BPM for an original amount of Euro 8.0 million, increased by Euro 4.5 million in September
2021 with a quarterly maturity and a rate equal to the 3-month Euribor (zero floor) plus a
spread of 1.1%. 36 months
• Short-term financing so-called "Hot money" granted by the Banca d’Alba to the subsidiary
Giordano Vini S.p.A. with opening of current account credit for Euro 1.5 million, renewed on a
quarterly basis with a rate of 0.8%. The maturity of the loan is set at the maturity of each
quarter.
• "Import" short-term loan granted to the subsidiary Giordano Vini S.p.A. from
Banca d’Alba for an amount of € 1.0 million with maturity on March 15, 2022 and a rate of
0.7%.
• Medium-term loan of Euro 2 million granted to the subsidiary Giordano Vini S.p.A. disbursed
on 20 February 2017 by Intesa San Paolo, repayable in quarterly installments and repayment
€thousand
31.12.2020
Disbursements /
Other changes
Refunds / Other
changes
Fair value
adjustment
Operating
costs/expenses
31.12.2021
Bond
- 130.000 795
130.795
Pool financing - Senior
16.300 - (16.625) 325 -
0
Short-term unsecured loans
1.500 14.142 - - -
15.642
GV revolving loans
9.000 16.000 (9.000) - -
16.000
Other loans in addition to e.g. unsecured loans
5.157 2.400 (2.038) (12) -
5.507
Financial accrued expenses and charges to be se
65 239 (65) - - 239
Total Banks 32.022 32.781 (27.728) 313 - 37.388
Payables to factoring companies - 10 - - - 10
Deferred price acquisition of Raphael Dal Bo AG 1.861 - (1.861) - - -
Total other lenders 1.861 10 (1.861) - - 10
Total 33.883 162.791 (29.589) 1.108 - 168.193
scheduled for 20 February 2022, at a rate equal to the 3-month Euribor plus a spread of 2.10%.
The residual debt at 31 December 2021 valued using the amortized cost method amounts to
Euro 0.1 million.
• Medium-term loan of Euro 2.4 million granted to the subsidiary Giordano Vini S.p.A.
disbursed on February 26, 2021 by Credit Agricole, repayable in quarterly installments and
repayment scheduled for February 26, 2026, at a rate equal to the 3-month Euribor plus a
spread of 1.00%. The residual debt at 31 December 2021 valued using the amortized cost
method amounts to Euro 2 million.
An IRS-OTC derivative contract was stipulated against the aforementioned loan to hedge the
interest rate risk for the entire duration of the loan; this contract provides for an exchange of
flows between the Company and Credit Agricole defined on the basis of the residual amount
of the underlying loan in any given period; the Mark To Model value of the derivative is
negative for Euro 29 thousand.
• "Revolving" short-term loan granted on 6 May 2019 to the subsidiary Giordano Vini S.p.A. by
Crédit Agricole for an original amount of Euro 2.0 million, increased by Euro 1.5 million at the
beginning of 2021 with a quarterly maturity and a rate equal to the 3-month Euribor plus a
spread of 0.60%.
• Medium-term loan of Euro 3 million granted to the subsidiary Provinco Italia S.p.A. disbursed
on November 30, 2020 repayable in quarterly installments and repayment scheduled for
November 30, 2023, at the rate equal to the 3-month Euribor plus a spread of 2.00%. The
residual debt at December 31, 2021 amounts to € 2 million.
• Unsecured loan of € 1.5 million contracted by Provinco Italia S.p.A with Credito Emiliano on
September 20, 2021, repayable in deferred quarterly installments and repayment scheduled
on September 20, 2024 at a fixed rate of 0.8% per annum. The residual debt as at 31 December
2021 was 1.376 thousand.
Short-term loan of € 8 million granted by Deutsche Bank S.p.A. to Provinco S.p.A. paid on 10
September 2021. Maximum duration 1 year with quarterly renewal. Interest rate: variable,
determined on an annual nominal basis by the sum of: a) a fixed amount equal to 0.700%
denominated spread; b) a variable portion equal to the 3-month Euribor rate, base 360
(currently equal to -0.570% per annum). The residual debt at December 31, 2021 is equal to
euro 8 million. Refund method: at any time, without penalties for the customer.
81 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
81 |
• Short-term loan of € 1.5 million contracted with Credito Emiliano S.p.A.
On 14 September 2021. Interest rate: variable, determined on an annual nominal basis by the
sum of: a) a fixed amount equal to 0.26% called the spread; b) a variable portion equal to the
3-month Euribor rate, base 360 (currently equal to -0.570% per annum) with a floor of 0.00%.
Duration: maximum 1 year, with quarterly renewal. Refund method: at any time, without
penalties for the customer. The residual debt at December 31, 2021 is equal to euro 1.5 million.
• Short-term SBF loans for a total of € 3,642 thousand granted to Enoitalia S.p.A by various
institutions at an average rate of 0.51%
Financial payables are recognized in the balance sheet at the value resulting from the
application of the amortized cost, determined as the initial fair value of the liabilities net of the
costs incurred to obtain the loans, increased by the accumulated amortization of the difference
between the initial value and the maturity, calculated using the effective interest rate la where
the application of the amortized cost method is not relevant compared to the nominal value
The aforementioned loan agreements have similar clauses and practices for this type of
transaction, such as, for example: (i) provision of a financial covenant (calculation envisaged at
the Italian Wine Brands Group level) based on the performance of certain financial parameters
at consolidated Group level; (ii) disclosure obligations in relation to the occurrence of
significant events for the Company, as well as corporate disclosure; (iii) commitments and
obligations, usual for financing transactions of this kind, such as, by way of example, limits on
the assumption of financial debt and the sale of one's assets, prohibition on distributing
dividends or reserves where certain financial parameters are not respected.
18 Termination benefits
Defined contribution plans
In the case of defined contribution plans, the Company pays contributions to public or private
insurance institutions on the basis of a legal or contractual obligation, or on a voluntary basis.
By paying the contributions, the Group fulfils all its obligations.
Payables for contributions to be paid at the reporting date are included in the item "Other
current liabilities"; the cost pertaining to the period accrues on the basis of the service
rendered by the employee and is recorded in the item "Personnel costs" in the area of
belonging.
Defined benefit plans
Employee benefit plans, which can be classified as defined benefit plans, are represented by
the termination benefits (TFR); the liability is instead determined on an actuarial basis using
the "projected unit credit" method. Actuarial gains and losses determined in the calculation of
these items are shown in a specific equity reserve. The changes in the liability for termination
benefits at 31 December 2021 are shown below:
The component "allocation of costs for employee benefits" and "contribution/benefits paid"
are recorded in profit or loss under the item "Personnel costs" in the area to which they refer.
The component "financial income/(expenses)" is recognized in profit or loss under "Financial
income/(expenses)", while the component "actuarial income/(expenses)" is recognized under
other comprehensive income and transferred to a Shareholders' equity reserve called "Reserve
for defined benefit plans".
At 31 December2021 the main actuarial assumptions used at the end of 2020 have been
confirmed as follows:
€thousand
2021 2020
Provision at 1 January
621
651
Provisions
186
42
Increases from business combinations
436
Advances paid during the period - -
Benefits paid out in period (41) (76)
Actuarial (gains)/losses 11 6
Financial costs (2) (1)
Provision at end of period 1.212 621
Actuarial assumptions
31.12.2021 31.12.2020
Discount rate (0,25%) (0,10%)
Inflation rate 2,28% 1,20%
Expected average turnover 8,98% 8,62%
83 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
83 |
19. Provision for risks and charges
During the period the item changed as follow:
Non-current liabilities mainly include:
x a provision of Euro 125 thousand relating to potential liabilities relating to the
supplementary indemnity of client agents set aside by Provinco Italia S.p.A.
determined taking into account the collective economic agreements and the
maximum limit of art. 1751 of the Civil Code.
x a provision of € 100 thousand for a lawsuit against a former "agent" set aside by
Enoitalia S.p.A.
20. Trade Payables
This item includes all trade payables which have the following geographical distribution:
€thousand
Non- current Current
Total
Provision at 1.1.2020
994 -
994
Provisions - - -
Amounts used (734) - (734)
Provision at 31.12.2020 260 - 260
€thousand
Non- current Current Total
Provision at 1.1.2021 260 - 260
Provisions - - -
Increase by business combination
100 100
Releases - - -
Amounts used (26) - (26)
Provision at 31.12.2021 334 - 334
€thousand
31.12.2021 31.12.2020
Suppliers Italy 134.485 55.289
Suppliers Foreign markets 2.882 1.520
137.367 56.809
21. Other liabilities
Other liabilies are made as follow:
Payables to employees mainly include wages for December 2021 paid in January 2022 and
deferred fees for holidays and holidays accrued and not yet taken.
The item deferred income mainly consists of the portion pertaining to future years of the
grants on plant account obtained for Industry 4.0 projects and tax credits relating to Enoitalia
equal to 1,400 thousand euros
The item Other includes the payable relating to the settlement agreement, including legal fees,
referred to in paragraph 19. Provision for risks and charges.
22. Current Tax liabilities
The item is made as follow:
€thousand
31.12.2021 31.12.2020
Employees 3.764 1.131
Social security institutions 1.092 522
Directors 976 639
Accruals and deferred income 3.078 441
Others 599 1.434
Total current 9.508 4.167
€thousand
31.12.2021
31.12.2020
VAT
1.815 1.619
IRES
(766) (1.095)
IRPEF withholding tax
632 327
IRAP
(337) 398
Excise duties
(16) 486
Other taxes
4 361
Total
1.332 2.096
85 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
85 |
23. Revenues from sales and other revenues
Revenues from sales and other revenues and income as at 31 December 2021, compared with
those of the two previous periods, are detailed below:
24. Purchase costs
Purchase costs refer for Euro 56.5 million (Euro 50.6 million at 31/12/2020) to Giordano Vini
S.p.A., for Euro 1.96 million to Pro.Di.Ve. S.r.l. (Euro 1.25 million at 12/31/2020), for Euro 69.97
million (Euro 66.3 million at 12/31/20) to Provinco Italia SpA, for Euro 6.2 million to Raphael
Dal Bo AG ( Euro 4.8 million at 12/31/20) and for Euro 96.6 million to Enoitalia SpA
Amounts in €thousand
31.12.2021 31.12.2020 31.12.2019 ∆ % 20/21 Cagr 19/21
Revenues from sales - Italy 57.597 39.539 33.333 45,67% 31,45%
Revenues from sales - International Markets 254.719 164.080 123.543 55,24% 43,59%
UK 66.447 24.254 17.262 173,97% 96,20%
Germany 51.863 41.961 35.298 23,60% 21,21%
Swiss 48.154 48.814 27.572 (1,35%) 32,15%
Austria 17.764 18.493 14.589 (3,94%) 10,35%
US 10.430 1.561 3.018 568,28% 85,90%
Belgium 9.190 6.641 4.039 38,39% 50,84%
France 9.020 5.760 5.087 56,60% 33,16%
Netherland 6.597 1.709 960 286,10% 162,17%
Poland 6.040 1.086 1.038 456,30% 141,28%
Denmark 6.004 5.020 5.177 19,59% 7,69%
Ireland 4.512 1.516 1.008 197,55% 111,61%
Canada 2.446 877 617 179,05% 99,14%
Sweden 1.681 1.586 1.324 5,97% 12,67%
Hungary 1.666 1.544 1.312 7,93% 12,70%
China 1.225 882 1.264 38,92% (1,55%)
Other Countries 11.681 2.378 3.979 391,29% 71,34%
Other revenues 910 692 617 31,49% 21,46%
Total revenues from sales 313.227 204.311 157.494 53,31% 41,03%
25. Costs for services
The costs for services at 31 December 2021, compared with those of the previous year, are
detailed below: i:
The fees to directors, statutory auditors and the control body are detailed as follows:
It should be noted that, during the 2021 financial year, the remuneration for the Independent
Auditors is divided as follows:
€thousand
31.12.2021 31.12.2020
31.12.2019
Services from third parties
21.374 18.601 11.892
Transport
17.174 14.935 11.871
Postage expenses
4.119 4.007 4.098
Fees and rents
1.001 717 447
Consulting
2.118 1.443 1.285
Advertising costs
1.098 3 3
Utilities
1.681 824 844
Remuneration of Directors, Statutory
Auditors and Supervisory Body
2.512 1.946
1.831
Maintenance
1.313 370 235
Costs for outsourcing
7.382 7.407 7.051
Commissions
898 141 121
Other costs for services
3.539 2.931 2.952
Total
64.209 53.325 42.630
€thousand
31.12.2021 31.12.2020
Directors 2.379 1.870
Statutory auditors 110 69
SB 23 6
Total 2.512 1.945
€thousand
Audit Consulting
Holding 14 18
Subsidiaries 80 -
Total 94 18
87 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
87 |
26. Personnel costs
Personnel costs at 31 December 2021, compared with those of the previous year, are detailed
below:
The following table shows the number of employees:
27. Other operating costs
he item "other operating costs" amounts to Euro 1,013 thousand compared to Euro 1,365
thousand at 31/12/2020 and mainly includes: contingent liabilities of Euro 157 thousand, non-
deductible taxes for approximately Euro 305 thousand, non-deductible VAT portion due to the
pro-rata of approximately Euro 147 thousand, concessions, licenses and various taxes equal to
Euro 145 thousand and Euro 80 thousand relating to capital losses.
28. Devaluation
The item essentially relates to the subsidiary Giordano Vini S.p.A. and relates to the write-
down of trade receivables accounted for in the period.
€thousand
31.12.2021 31.12.2020
Wages and salaries 9.760 6.041
Social security charges 3.012 1.798
Termination benefits 689 331
Stock grant 683 374
Administration cost 1.075 116
Other costs 71 24
Total 15.290 8.685
At Average no At Average no
31.12.2021 31.12.2021 31.12.2020 31.12.2020
Executives 6 6 6 7
Middle managers 21 21 14 12
Employee 174 161 121 122
Workers 127 128 20 19
Total 328 317 161 160
29. Financial income and expences
Financial income and expenses are detailed in the following tables:
In detail, interest on loans includes:
• interest expense on medium / long-term loans;
• interest expense on bank current accounts relating mainly to the use of current account
overdrafts with various banking institutions;
• realized exchange differences and period-end adjustments relating to items in foreign
currency;
• commissions and bank charges including those for sureties.
€thousand
31.12.2021
31.12.2020
On current accounts
4 20
Exchange rate gain/(loss)
585 156
Others
2 39
Total
591 216
€thousand
31.12.2021
31.12.2020
Bond interests
(2.205)
Loans
(577) (568)
Right-of-use liabilities
(369) (309)
Bank current accounts
(34) (4)
Financial instruments
(24) -
Bank fees and charges
(487) (290)
Exchange rate gain/(loss)
(339) (172)
Others
(494) (58)
Total
(4.530) (1.401)
89 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
89 |
30. Taxes
The taxes at 31 December 2021, compared with those of the previous year, are detailed below:
31. Agreements with Related parties
At 31December2021 there were:
(iii) a commercial lease agreement entered into on 1 February 2012 between Provinco
Italia S.p.A. and Provinco S.r.l. pursuant to which Provinco S.r.l. leased the property
located in Rovereto (TN) - Via per Marco, 12/b to Provinco Italia S.p.A.; the lease
is valid for six years (until 31 January 2018) with tacit renewal for the same period
unless notice of termination is given 12 months before expiry; the agreed rent is
equal to €60 thousand per year plus VAT.
(iv) (ii) service contracts with Electa SpA concerning respectively (a) support for the
preliminary analyzes and the executive definition of M&A projects for an amount
equal to Euro 80 thousand (b) services to support the analysis of possible financing
alternatives, the definition of the terms and conditions of the loans, the review of
the documentation and the fulfillment of the related corporate obligations for an
amount equal to € 100 thousand (c) support for investor relations activities for an
amount equal to € 40 thousand
The above relationship is regulated at conditions at arm’s length.
It should also be noted that, as detailed in the paragraph Significant events of the year for the
acquisition of 55% of Enovation Inc the Company's Board of Directors approved the
transaction subject to the favourable opinion issued by the Company's Independent Director,
31.12.2021 31.12.2020
IRES
(4.116) (2.590)
IRAP
(487) (469)
Taxes for prior periods
175 (4)
Total current taxes
(4.428) (3.063)
Prepaid taxes
(83) 84
Deferred taxes
78 140
Total deferred taxes
(5) 224
Total
(4.433) (2.839)
Antonella Lillo, regarding the signing of the sale and purchase agreement with Norina, as well
as on the appropriateness and fairness of the related conditions. This opinion was issued
because Norina is a “related party” of the Company as it belongs to the four family branches
of the Pizzolo family, including the Vice Chairman of IWB, Giorgio Pizzolo, and the director of
IWB, Marta Pizzolo. It should be noted that the sale and purchase of the Norina Shareholding
qualifies as a related-party transaction of “less importance” pursuant to the “Procedure for
transaction with related party” adopted by the Company and the Regulation approved by
Consob with resolution No. 17221/2010.
32. Atypical and unusual transactions
Pursuant to Consob communication no. DEM/6064293 of 28 July 2006, during the period the
Group did not carry out atypical or unusual transactions, as defined by the communication
itself, according to which atypical and/or unusual transactions are those that, due to their
significance/relevance, the nature of the counterparties, the object of the transaction, the
method of determining the transfer price and the timing of the event, may give rise to doubts
regarding: the correctness/completeness of the information in the financial statements, the
conflict of interest, the safeguard of the company's assets, the protection of non-controlling
interests.
*****
For the Board of Directors
The Chairman and Chief Executive Officer
Alessandro Mutinelli
91 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
91 |
ANNUAL FINANCIAL REPORT
31 DECEMBER 2021
ITALIAN WINE BRANDS S.P.A.
Registered office in Milan, Viale Abruzzi, 94
joint-stock company with subscribed and paid-up share capital of Euro 1.046.265,80
Tax Code Company Reg. No. 08851780968
Registered in the Companies Register of Milan
R.E.A. No. 2053323
www.italianwinebrands.it
Table of contents
Composition of Administrative and Supervisory Bodies 93
Directors’ Report on Operations 94
Annual Financial Report
Statement of Financial Position 109
Comprehensive Income Statement 110
Statement of changes in Shareholders’ Equity 111
Statement of Cash Flows 112
Form and content of Financial Report 113
Notes to the Financial Statements 121
Appendix: IFRS Transition 137
93 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
93 |
Composition of Corporate Bodies
Board of DIrectors
Alessandro Mutinelli (Chief Executive Officer and Chairman)
Giorgio Pizzolo (Deputy Chairman)
Pier Paolo Quaranta (Director with delegated powers)
Simone Strocchi
Marta Pizzolo
Massimiliano Mutinelli
Antonella Lillo (Indipendent Director)
Board of Statutory Auditors
David Reali (Chairman of the Board of Statutory Auditors)
Debora Mazzaccherini (Statutory Auditor)
Eugenio Romita (Statutory Auditor)
Indipendent Auditors
BDO Italia S.p.A.
Nomad
Intesa Sanpaolo S.p.A.
Directors' Report on Operations
1. Analysis of the Company's situation, performance and operating results
1.1. Reference market in which the company operates
The IWB Group is one of the leading Italian players in the production and distribution of
domestic wines, which stands out for the size of the reference markets in which it operates,
the number of brands it has in its portfolio and the variety of distribution channels.
In terms of its target markets, IWB's business is predominantly and increasingly achieved with
foreign customers, also thanks to Enoitalia S.p.A acquisition finalized on July 2021, and only
the remaining part with domestic customers.
Sales are made exclusively through a portfolio of proprietary and registered brands. In
particular, the group operates under the various brands:
95 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
95 |
With centralised governance functions (finance & IT, marketing, production and quality, and
purchasing), the IWB Group is unique because it has three different sales and distribution
channels:
x the "wholesale" channel for the sale of products to operators in the sector, such as
large-scale distribution chains, state monopolies and traditional trade,
x the "distance selling" channel for direct sales of products in the portfolio to private
consumers.
x the Ho.re.ca channel aimed at the sale to hotels, restaurants and catering in which the
IWB Group is active, thanks to the acquisition of Enoitalia S.p.A, in particular in the US
market and in the UK.
From a corporate point of view, IWB S.p.A. carries out management activities for Group
companies as well as management and coordination activities, directly holding controlling
interests in the main Group companies: Giordano Vini S.p.A, Enoitalia S.p.A. and Provinco
Italia S.p.A.
The corporate organization chart of the Italian Wine Brands Group is provided below:
97 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
97 |
1.2.2 Financial and equity position of IWB S.p.A.
The financial statement of IWB S.p.A. at 31 December 2021 shows:
x A Net Profit for the period of € 9,8 million (€ 7,8 million at 31 December 2020);
x Net financial position of €72,5 million (€30,1million positive at 31 December 2020)
Below is a summary of the parent company's statement of financial position, financial position
and income statement.
In relation to the above statement of financial position, it should be noted that:
- The equity investments in subsidiary companies consist of Giordano Vini S.p.A. for
€32,823 thousand, Provinco Italia S.p.A. for €21,433 thousand and Enoitalia
151.225thousand (including acquisition costs)
- current and non-current financial assets are represented by financial receivables from
/ loans to subsidiaries.
Reclassified statement of financial position
€thousand
31.12.2021 31.12.2020 31.12.2019
Other intangible assets 196 224 194
Right-of-use assets 179 238 298
Tangible assets 122 143 163
Investment in subsidiaries 205.481 54.256 54.256
Total Fixed Assets 205.978 54.861 54.911
Net trade receivables 2.282 112 1.267
Trade Payables (211) (121) (328)
Other assets (liabilities) 4.821 4.354 2.958
Net working capital 6.892 4.345 3.897
Payables for employee benefits (37) (24)
-
Net deferred and prepaid tax assets (liabiliies) - - -
Other provisions
- - -
NET INVESTED CAPITAL 212.833 59.183 58.808
Shareholders' equity 140.266 89.264 80.268
Profit (loss) for the period 9.780 7.799 6.388
Share capital 1.046 880 880
Other reserves 129.440 80.585 73.000
Net Financial position 72.567 (30.082) (21.460)
TOTAL SOURCES 212.833 59.183 58.808
In relation to the situation described above in the income statement:
- dividends refer entirely to the subsidiary Provinco Italia S.p.A.;
- costs for services and personnel costs include respectively € 794 thousand and € 289
thousand of fees relating to the assignment of stock grants relating to the 2020-2022 plan;
- financial income refers to interest incomes accrued on the loans granted to the
subsidiaries Giordano Vini S.p.A. (equal to € 458 thousand), Enoitalia Sp.A. (equal to Euro
27 thousand) and Provinco SpA (equal to Euro 27 thousand) and to interest income
accrued on current accounts and liquidity deposit accounts (Euro 2 thousand); financial
charges are mainly represented by interest expense relating to the bond loan equal to €
2,205 thousand.
Reclassified Income statement
€thousand
31.12.2021 31.12.2020 31.12.2019
Revenue from sales 1.369 800 200
Other income 72 57 39
Total revenues 1.441 857 239
Purchase costs (16) (1) (5)
Costs for services (1.773) (1.465) (1.224)
Personnel costs (1.017) (796) (256)
Other operating costs (214) (462) (88)
Total operating costs (3.020) (2.725) (1.573)
EBITDA (1.579) (1.868) (1.334)
Write-ups / (Write-downs) - - -
Depreciation and Amortization (170) (162) (56)
Operating result from core business (1.749) (2.030) (1.390)
Net releases (accruals) for provision risks and charges - - -
EBIT (1.749) (2.030) (1.390)
Net Finance revenues (costs) (1.859) 182 189
Dividends 12.402 9.152 7.355
EBT 8.794 7.303 6.154
Taxes 986 496 234
Net Result 9.780 7.799 6.388
99 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
99 |
Summary of Management Adjustments
3. Costs for Services and Personnel, respectively equal to € 794 thousand for Services and equal to €289 thousand for Personnel
related to the accrual and allocation of the second tranche of the 2020-2022 Stock Grant Plan, representing 18,75% of the
total value of the plan itself and in line with the achievement of profitability targets and control of the net financial position
in 2021. In particular, the Pro-Forma Restated EBITDA target for the first year is €41.0m and the NFP to Restated EBITDA
target ratio at 31 December 2021 is less than 3.0x.
Reclassified Income stetement
€thousand
Reported
Management adjustments Restated
31.12.2021 1 2 31.12.2021
Revenue from sales
1.369 1.369
Change in inventories
00
Other income
72 72
Total revenues
1.441 1.441
Purchase costs
(16) (16)
Costs for services
(1.773) 794 (979)
Personnel costs
(1.017) 289 (728)
Other operating costs
(214)
(214)
Total operating costs
(3.020) 0 1.083 (1.937)
EBITDA
(1.579) 0 1.083 (496)
Write-ups / (Write-downs)
00
Amortization and depreciation
(170) (170)
Operating result from core business
(1.749) 0 1.083 (666)
Exceptional items
0 0 (1.083) (1.083)
Net releases (accruals) for provision risks and charges
00
EBIT
(1.749) 0 (1.749)
Net Finance revenues (costs)
(1.859) (1.859)
Dividends
12.402 12.402
EBT
8.794 0 8.794
Taxes
986
986
Net Result
9.780 0 9.780
Tax effect of exceptional charges
302
Net profit before exceptional items and related tax effect
10.561
1.2.2 Net Financial Position
The details of the net financial debt as at 31 December 2021 as at 31 December 2020 and as
at 31 December 2019 are provided below, set out on the basis of the new scheme provided
for by the ESMA guideline 32-382-1138 of 4 March 2021.
2.1 Significant events of the year
2.1.1 Bond
It should be noted that on May 13, 2021 Italian Wine Brands successfully placed on the market
its first Senior Unsecured Bond Loan for a total amount of Euro 130.0 million, maturing May
13, 2027, bullet repayment and a fixed interest rate at 2.5% per annum. The proceeds from
this bond issue were allocated i) to the repayment of an existing credit line (Euro 24.0 million)
which took place in June 2021 and ii) to the payment of a portion of the price relating to the
€thousand
31.12.2021 31.12.2020
A. Cash
-
-
B. Cash equivalents
11.364
15.208
C. Other current financial activities
47.104
15.157
D. Liquidity (A) + (B) + (C)
58.468
30.365
E. Current financial debt (included financial instruments but not included current
part of non current financial debt)
25
-
F. Current part of non current financial debt
70
68
G. Current financial debt (E) + (F)
95
68
H. Net current financial debt (G) - (D)
(58.373)
(30.297)
I. Non current financial debt (excluded current part and financial instruments)
- -
J. Financial instruments
130.795 -
K. Trade payables and other non current debts/right of use
146 216
L. Non current financial debt (I) + (J) + (K) 130.941 216
M. Net financial position (H) + (L) 72.567 (30.082)
of which
Current payables for the acquisition of right of use
70 68
Non Current payables for the acquisition of right of use
146 216
Net financial position without the effect of IFRS 16 72.351 (30.366)
101 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
101 |
acquisition of 100% of Enoitalia S.p.A. (euro 105 million) completed on July 2, 2021 (as better
explained in the following paragraph).
2.1.2 Enoitalia S.p.A acquisition
On 27 July 2021, Italian Wine Brands S.p.A. finalised its investment transaction in Enoitalia
S.p.A. (the "Transaction") which provided for:
iii. the acquisition of the entire share capital of the company (the "Acquisition") for a total
consideration of € 150,500,000.00;
iv. the reinvestment by Gruppo Pizzolo S.p.A., the holding company of Enoitalia S.p.A., in the
share capital of Italian Wine Brands S.p.A. for a total of € 45,500,000.00, through the
subscription of a reserved share capital increase. (the "Reserved Share Capital Increase").
This Reserved Share Capital Increase provided for the issuing of 1,400,000 ordinary shares
of Italian Wine Brands S.p.A., at a subscription price of EUR 32.50 per share.
Simultaneously to the closing of the Transaction, Chairman and CEO of the IWB Group,
Alessandro Mutinelli, through Provinco S.r.l., (a company wholly owned by him), and Gruppo
Pizzolo S.p.A., signed a 5-year shareholders' agreement covering 23.55% of IWB's share capital
and providing for the following main understandings reached between the parties:
vii. appointment of the Board of Directors: the parties of the shareholders' agreement
undertook to vote, at the Shareholders' Meeting of IWB, with all shareholdings covered
by the agreement, in favour of the proposal submitted by Provinco S.r.l. in accordance with
the following:
c. (a) the majority of the members of the Board of Directors shall be appointed on the
recommendation of Provinco S.r.l.;
d. In the event that: (X) it is proposed that the Board of Directors of the Company be
composed of 7 members, 2 directors will be appointed by Gruppo Pizzolo, including the
Vice Chairman of the Board of Directors of IWB with proxies; and (Y) it is proposed that
the Board of Directors of the Company be composed of 9 members, 3 directors will be
appointed by Gruppo Pizzolo, including the Vice Chairman of the Board of Directors of IWB
with proxies and 1 director must meet the independence requirements provided by law;
viii. Direct lock-up: the 1,400,000 new ordinary shares of IWB resulting from the reserved
capital increase subscribed by Gruppo Pizzolo are subject to a lock-up restriction (subject
to specific exceptions to allow the transfer of these shares in compliance with legal or
regulatory obligations) for the purpose of stabilising the share price, for a period of 36
months from closing date of the Transaction;
ix. Indirect lock-up: also in order to allow the effective implementation of the project of
integration of the two industrial groups, the historical partners of Enoitalia have
undertaken not to transfer, in whole or in part, the shareholdings that they hold, directly
or indirectly, in the corporate vehicles that own the entire share capital of Gruppo Pizzolo
and to ensure that the aforementioned companies do not transfer, in whole or in part to
third parties the shareholding they hold in the Gruppo Pizzolo's share capital;
x. standstill: for a period of 36 months from the closing date of the Transaction, Gruppo
Pizzolo and the historical shareholders of Enoitalia (directly or indirectly, and whether
acting alone or in concert with another person) have undertaken to: (i) not to buy or offer
to buy, or to cause or encourage any other related person to buy or offer to buy, IWB
shares (or IWB financial instruments of any other nature) and (ii) not to enter into any
contracts, agreements or understandings (including non-binding ones), including
shareholders' agreements, or to engage in any conduct that has the effect of acquiring an
interest, direct or indirect, in IWB shares (or IWB financial instruments of any other
nature);
xi. tag-along: if one of the parties to the shareholders' agreement (in the case of Gruppo
Pizzolo, after the lock-up commitment has expired) intends to sell its entire shareholding
under the shareholders' agreement to a potential third party purchaser the other party
will be entitled to sell, in turn, to the third party purchaser, in whole or in part, the shares
in the Company then held directly and indirectly under the same terms and conditions. In
the event of the exercise of the right of co-sale, if the third party does not intend to acquire
the shareholding of both shareholders, neither of them will be able to complete the
transfer of their shares.
xii. drag-along: in the event that Provinco S.r.l. intends to transfer to a third party all of its
shareholding that is the subject of the agreement, Provinco S.r.l. will have the right to
request Gruppo Pizzolo to transfer (and, in this case, Gruppo Pizzolo will have the
obligation to transfer) all of the IWB shares then held, directly and indirectly, in favour of
the third party purchaser.
Enoitalia is an Italian company operating in the production, bottling and marketing of wine in
five continents and over eighty countries and exports about 80% of its products. The main
reference markets are continental Europe, the UK and the United States, where Enoitalia
boasts a presence in both on and off trade channels; other markets, such as Asia, Australia,
Russia and the Middle East are instead served by a dedicated task force.
Enoitalia has a business model and a set of skills that are extremely complementary to those
of IWB and, for this reason, the Transaction represents a significant opportunity to integrate
the group headed by IWB with that headed by Enoitalia in order to create significant synergies,
both in terms of market positioning and product offering.
During the entire 2020 financial year, Enoitalia achieved sales revenues for a total of Euro 200.8
million, with an Ebitda of Euro 17.1 million and a net financial debt of Euro 1.1 million. These
accounting data can be inferred from the company's financial statements as at 31 December
2020, drawn up according to the OIC accounting principles.
103 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
103 |
During the first half of 2021, Enoitalia achieved revenues from sales for a total of Euro 97.3
million, with an Ebitda of Euro 7.2 million and a net financial debt of Euro 11.0 million. These
accounting data can be deduced from the half-year financial statements drawn up in
accordance with the OIC accounting principles and not subject to audit.
2.1.3 Agreements for the acquisition of 85% shareholding in Enovation Brands Inc
On 30 December 2021 Italian Wine Brands S.p.A. announced the signing of agreements for the
acquisition of 85% of the share capital of Enovation Brands Inc.
Enovation, based in Miami, is a long-standing importer of Italian wines into North America. It
is the owner of proprietary brands that are highly recognised in the US market (Voga®, among
the main ones) and it relies on a widespread distribution throughout the North American,
both in the supermarkets and ho.re.ca. channels.
From June 2020 to June 2021, Enovation achieved sales revenue of USD 32.2 million (with
82% of sales revenue generated in the US and 18% in Canada). In the same period, Enovation
achieved adjusted buyside Ebitda of USD 3.2 million, net accounting profit of USD 3.4 million.
The net financial position at 30 June 2021 was USD 0.1 million.
The brothers Giovanni and Alberto Pecora, co-founders and operating managers of the
company, hold 45% of Enovation share capital and Norina S.r.l., a financial company that is
owned by the four branches of the Pizzolo family (“Norina”) holds 55% of Enovation share
capital. More specifically, IWB signed two sale and purchase agreements with deferred and
conditional execution, which provide for IWB to acquire, directly or through a company
controlled by it, respectively
(iii) Norina's entire 55% interest in the share capital of Enovation (the “Norina
Shareholding”); and
(iv) a shareholding in the share capital of Enovation, equal in total to 30% of the same,
owned by the Pecora brothers (the “Pecora Shareholding”).
Following the completion of the transaction, the share capital of Enovation will therefore be
held as follows:
(a) IWB will hold, directly or indirectly, an interest of 85% of the relevant
share capital; (b) Giovanni Pecora will hold an interest of 10% of the relevant share capital;
and (c) Alberto Pecora will hold an interest of 5% of the relevant share capital.
The equity value agreed between IWB and the sellers for the purchase of 85% of Enovation's
share capital is USD 22 million, which corresponds to an equity value for 100% of the company
of USD 25.9 million. The enterprise value of USD 26.0 million corresponds to an EV/Ebitda
adjusted buyside valuation multiple of 8.1x.
To finance the acquisition of the equity of Enovation, IWB will use its cash equivalents without
resorting to specific and dedicated forms of financing.
The agreements between IWB and the sellers also state that the payment of a portion equal
to 20% of the price, i.e. USD 4.4 million (i.e. 20% of USD 22 million), is subject to the condition
precedent of the achievement of accretive EBITDA results in 2022 and 2023. The agreements
between the parties also provide for earn-out mechanisms in favour of the brothers Alberto
and Giovanni Pecora in the event of strongly positive results of the company to be achieved by
31 December 2024. IWB will use its own cash on hands in order to finance this acquisition with
no recourse to new dedicated bank debt.
The execution of the agreements is subject to the fulfilment, by 30 April 2022, of certain
conditions precedent, including the positive outcome of the due diligence activities to be
carried out by IWB with specific regard to the authorisations and licences owned by Enovation
and the obtaining of the consents of the competent US authorities for the change in the
shareholding structure.
The agreements provide for the release by the respective sellers of a set of representations
and warranties (and related indemnification obligations subject to time limits, materiality
thresholds and caps in line with practice for similar transactions), as well as non-competition
undertakings by the sellers, undertaken with respect to both IWB and Enovation, and non-
solicitation and non-reversal employee undertakings.
Through the integration of Enovation, IWB will have direct access to the American market,
which is the main market for Italian wines abroad (EUR 1.8 billion in estimated value in 2021).
Among the immediate revenue synergies generated by the transaction, Enovation will
certainly benefit from the distribution to its customers of new red wine references, produced
in particular in Puglia and Piemonte, where IWB has its own production cellars, while IWB will
be able to offer Enovation-branded products on the international markets served through its
own commercial network. With regard to cost synergies, possibilities to reduce the purchase
price of raw materials will be explored, linked to the higher purchase volumes achieved at
group level. The transaction also confirms IWB's propensity to grow both organically and
through acquisitions, this being the fourth transaction completed in less than four years after
Svinando.com, Raphael Dal Bo Ag and Enoitalia S.p.A..
The signing of the agreements for the acquisition of the majority shareholding in Enovation
was positively evaluated by the Board of Directors of IWB as a transaction with a strong
strategic value and with contents and potential to increase the value of the Company's shares.
The Company's Board of Directors also approved the transaction subject to the favourable
opinion issued by the Company's Independent Director, Antonella Lillo, regarding the signing
of the sale and purchase agreement with Norina, as well as on the appropriateness and
fairness of the related conditions. This opinion was issued because Norina is a “related party”
of the Company as it belongs to the four family branches of the Pizzolo family, including the
Vice Chairman of IWB, Giorgio Pizzolo, and the director of IWB, Marta Pizzolo. It should be
noted that the sale and purchase of the Norina Shareholding qualifies as a related-party
transaction of “less importance” pursuant to the “Procedure for transaction with related
party” adopted by the Company and the Regulation approved by Consob with resolution No.
17221/2010.
105 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
105 |
2.1.4 Asset management
From the asset managemen point of view , it should be noted that in 2021 IWB S.p.A (i)
distributed total dividends of Euro 4,794 thousand, (ii) bought n. 2,400 Italian Wine Brands
treasury shares for a total of Euro 52 thousand at an average price of Euro 21.84 per share.
With reference to the effects on the business of the Group companies deriving from Covid-19
(SARS-CoV-2), it should be noted that during 2021 the necessary measures were maintained
to ensure the continuation of company activities (ie organization of company spaces to ensure
the necessary distancing between people, incentives for remote work with reference to office
activities, creation of separate teams for production and transport activities).
As evidenced by the economic and financial results, there were no particular negative effects
on company performance, thanks to the presence of the Group on markets / channels not
impacted by Covid-19 (mainly e-commerce and large-scale distribution operators). The
administrative bodies of all the companies of the group keep the situation carefully monitored
in order to ensure any timely interventions where necessary to guarantee the ordinary
continuation of the business.
2.2 Significant events occurring after the end of the financial year
During the first months of 2022, no particular significant events are to be noted with respect
to the end of the 2021 financial year.
3. Outlook
The efforts of the management are, as always, aimed at expanding its distribution and
production capacity through the full satisfaction of its customers, both private and executive.
For IWB, the acquisition of Enoitalia allows in particular a significant strengthening (i) of the
product offering among the fastest growing categories within its core business and (ii) of the
market positioning, with an improvement in its profitability and the generation of cash flows,
benefiting from further economies of scale.
Furthermore, with the integration between IWB and Enoitalia, their respective
entrepreneurial, managerial and creative cultures will be brought together, as well as the
related know-how, to strengthen the competitiveness of the group, accelerate its
development path and implement cost and cost synergies. revenue aimed at maximizing
economic / financial results.
The focus of management is also focused in these first months of 2022 on defending operating
margins in the face of the substantial increase in the cost of production factors. In fact,
negotiations are underway with major customers to adjust the sales price lists on the basis of
the continuous increases in transport costs, energy and dry materials such as glass, packaging
and labels.
4. Codice etico e Modello organizzativo
On 27 July 2021, the parent company IWB Spa approved the adoption of the Organization,
Management and Control Model (the "231 Model") as required by Legislative Decree 231 of 8
June 2001, consistent with company processes and procedures and with the Group's
integration plan.
The model consists of a General Part, a Special Part and the Code of Ethics which, in line with
that adopted by Giordano Vini, constitutes an ideal alliance that the Group clearly establishes
with its Human Resources and with the main external interlocutors.
The entrepreneurial goals of the IWB are pursued without ever losing sight of respect,
responsibility, transparency, sobriety and continuous innovation, points of reference that have
always made it possible to guarantee the centrality of the "Customer" to whom to always offer
maximum satisfaction.
The drafting of the Model was carried out through (i) the gap analysis and identification of
sensitive processes in view of the most recent predicate offenses referred to in Legislative
Decree 231/2001; (ii) verification of the existence of a system of proxies and powers of
attorney connected with the organizational responsibilities assigned; (iii) the revision of the
prevention and control protocols based on the principle of segregation of duties.
At the same time, the Board of IWB S.p.A. proceeded with the appointment of the Supervisory
Body.
5. Transactions with related parties
The operations carried out are part of normal business management, within the typical activity
of each interested party, and are regulated under standard conditions.
(v) service contracts with Electa SpA concerning respectively (a) support for the
preliminary analyzes and the executive definition of M&A projects for an amount
equal to Euro 80 thousand (b) services to support the analysis of possible financing
alternatives, the definition of the terms and conditions of the loans, the review of
the documentation and the fulfillment of the related corporate obligations for an
107 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
107 |
amount equal to € 100 thousand (c) support for investor relations activities for an
amount equal to € 40 thousand
(vi) It should also be noted that, as detailed in the paragraph Significant events of the
year for the acquisition of 55% of Enovation Inc the Company's Board of Directors
approved the transaction subject to the favourable opinion issued by the
Company's Independent Director, Antonella Lillo, regarding the signing of the sale
and purchase agreement with Norina, as well as on the appropriateness and
fairness of the related conditions. This opinion was issued because Norina is a
“related party” of the Company as it belongs to the four family branches of the
Pizzolo family, including the Vice Chairman of IWB, Giorgio Pizzolo, and the director
of IWB, Marta Pizzolo. It should be noted that the sale and purchase of the Norina
Shareholding qualifies as a related-party transaction of “less importance” pursuant
to the “Procedure for transaction with related party” adopted by the Company and
the Regulation approved by Consob with resolution No. 17221/2010.
It should be noted that the Parent IWB has adopted and follows the related Related Party
Procedure in compliance with the general provisions of the Euronext Growth Milan Issuer
Regulations.
6. Information relating to the environment, safety and personnel
HEALTH AND SAFETY
During 2021, constant health surveillance was carried out as required by current legislation.
Awareness raising activities on environmental and safety issues continued during the year with
ad hoc training interventions, as well as on the accident prevention measures to be adopted
and on first aid, providing specific training for fire prevention officers and workers to first aid,
in full compliance with the reference regulatory framework.
GROUP WORKFORCE
The precise and average headcount by category at 31 December 2021, at 31 December
2020 and at 31 December 2019 is shown below for the Group companies:
7. Treasury shares
As of 31/12/2021 the Parent Company holds no. 6,092 ordinary shares, representing 0.08% of
the ordinary share capital.
As part of the purchase authorization approved by the Shareholders' Meeting on 7 February
2020, as of 31 December 2021, an additional 2,400 treasury shares were purchased and 34,612
ordinary shares and 34,612 phantom shares assigned in relation to the Italian Wine Brands SpA
and following the accrual of a total of no. 69,224 rights relating to the first tranche included in
the performance period of the Plan.
At Average no At Average no At Average no
31.12.2021 31.12.2021 31.12.2020
31.12.2020 31.12.2019 31.12.2019
Executives 6 6 6 7 6 8
Middle managers 21 21 14 12 10 10
Employee 174 161 121 122 122 126
Workers 127 128 20 19 16 18
Total 328 317 161 160 154 162
109 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
109 |
BALANCE SHEET
Note
31/12/2021 31/12/2020
Amounts in EUR
Non-current assets
Intangible fixed assets 5 196.042 223.856
Land, property, plant and equipment 6 301.079 380.991
Equity investments 7 205.481.085 54.255.982
Financial non current assets 8 28.100.000 4.100.000
Deferred tax assets 9 85.012 85.012
Total non-current assets
234.163.218
59.045.841
Current assets
Trade receivables 10 2.281.696 269.407
Current tax assets 11 829.658 1.167.135
Other current assets 12 4.979.680 5.295.282
Current financial assets 13 19.004.177 11.057.182
Cash and cash equivalents 14 11.365.680 15.208.143
Total current assets
38.460.890
32.997.150
Total assets
272.624.109
92.042.991
Shareholders’ equity
Share capital
1.046.266
879.854
Reserves
129.440.277
80.585.312
Net profit (loss) for the period
9.779.891
7.799.008
Total Shareholders’ Equity
15 140.266.434
89.264.174
Non-current liabilities
Financial liabilities 16 130.941.130 216.013
Provision for the other employee benefits 17 36.866 23.630
Total non curren liabilities
130.977.996
239.643
Current liabilities
Financial payables 18 95.245 67.806
Trade payables 19 210.618 120.801
Other current liabilities 20 1.073.816 2.350.566
Total current liabilities 1.379.679 2.539.174
Total shareholders’ equity and liabilities 272.624.109 92.042.991
PROFIT AND LOSS
Note
31/12/2021
31/12/2020
Amounts in EUR
Revenue from sales
21 1.368.771
800.000
Other income
21 72.247
57.358
Total revenues
1.441.017
857.358
Purchase costs
22 (16.255)
(1.485)
Costs for services
23 (1.772.892)
(1.465.399)
Personnel costs
24 (1.016.859)
(796.325)
Other operating costs
25 (213.979)
(461.762)
Operating costs
(3.019.985)
(2.724.971)
00
EBITDA (1.578.968) (1.867.613)
Depreciation and amortization 5 , 6 (170.448) (162.140)
Operating profit/(loss) (1.749.415) (2.029.753)
Net financial income/(expenses) 26 10.543.170 9.333.183
EBT 8.793.755 7.303.429
Taxes 27
986.136 495.579
Net Result 9.779.891 7.799.008
111 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
111 |
CHANGES IN SHAREHOLDER’ EQUITY
Share Capital Premium Reserve
Legal
Reserve
Arrot
Stock grant
reserve
Own shares FTA Reserve
Valuation
Reserve
Retained
earnings
Net Result
Total Net
Equity
31/12/2019 ITA 879.854 65.049.504 175.971 1 (2.800.816)
- - 7.167.059 6.825.552 77.297.125
Transition (484.058) 623.887 2.971.165 (1.580) (139.829) 2.969.585
31/12/2019 879.854 64.565.446 175.971 1 623.887 (2.800.816) 2.971.165 (1.580) 7.027.230 6.825.552 80.266.710
Result allocation 6.825.552 (6.825.552) -
Dividends (739.810) (739.810)
Stock grant (279.979) (279.979)
Sale of own shares 2.218.245 2.218.245
Conprehensive Result 7.799.008 7.799.008
31/12/2020 879.854 64.565.446 175.971 1 343.908 (582.571) 2.971.165 (1.580) 13.112.972 7.799.008 89.264.174
Result allocation 7.799.008 (7.799.008) -
Share capital increase 166.412 45.333.588 45.500.000
Stock grant 267.330 267.330
Sale of own shares (343.908) 582.571 10.159 248.822
Dividends distribution (4.793.597) (4.793.597)
Conprehensive Result (186) 9.779.891 9.779.705
31/12/2021 1.046.266 109.899.034 175.971 1 267.330 - 2.971.165 (1.766) 16.128.542 9.779.891 140.266.434
STATEMENT OF CASH FLOWS
Amounts in EUR
31/12/2021 31/12/2020
Profit (loss) before taxes 8.793.755 7.303.429
Adjustments for:
- non-monetary items - provisions / (releases) - 7.604
- financial incomes (10.543.170) (9.333.183)
- non-monetary items - amortisation/depreciation
170.448 162.140
Adjusted profit (loss) for the period before taxes (1.578.968) (1.860.010)
Cash flow generated by operations
Paid in taxes 1.323.614 (1.690.457)
1.323.614 (1.690.457)
Change in net working capital
Change in receivables from customers (2.012.289) -
Change in trade payables 89.817 (206.807)
Change in other receivables and other payables (961.148) (980.689)
Change in post-employment benefits and other provisions 13.049 7.651
(2.870.571) (1.179.845)
Cash flow from operations (1) (3.125.925) (4.730.312)
Capital expenditure:
- Tangible (52.097) 59.535
- Intangible (10.626) (172.053)
- Financial
(151.225.103) -
Cash flow from investment activities (2) (151.287.825) (112.518)
Financial assets
Collections / (repayments) financial payables 130.752.556 (67.806)
(Increase) / (decrease) financial receivables (31.946.994) -
Financial income (costs) 10.543.170 9.333.183
Share capital increase 45.500.000 -
(Purchase) / Sale of own shares 516.152 1.938.267
Dividends paid
(4.793.597) (739.810)
Cash flow from financing activities (3) 150.571.287 10.463.834
Cash flow from continuing operations (3.842.463) 5.621.004
Change in cash and cash equivalents (1+2+3) (3.842.463) 5.621.004
Cash and cash equivalents at beginning of period 15.208.143 9.587.139
Cash and cash equivalents at end of period 11.365.680 15.208.143
113 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
113 |
FORM AND CONTENT
OF THE FINANCIAL REPORT
Introduction
This Financial Report at 31 December 2021 has been prepared in accordance with the Euronext
Growth Milan Regulation and in compliance with International Financial Reporting Standards
("IFRS") issued by the International Accounting Standards Board ("IASB") and approved by the
European Union. The designation “IFRS” also includes all currently valid International
Accounting Standards (“IAS”), as well as all interpretations of the International Accounting
Reporting Interpretations Committee (“IFRIC”), formerly the Standing Interpretations
Committee (“SIC”).
The financial statement at 31 December 2021 is the first financial statements of the Company,
drawn up according to international accounting standards, and provide comparative
information referring to the previous year, as required by the reference accounting standards.
Please refer to the appendix regarding the impacts resulting from the adoption of international
accounting standards in first time adoption.
1 Statement of financial position schedules
This Financial Report at 31 December 2021 consists of the statement of financial position, the
statement of comprehensive income, the statement of changes in shareholders' equity, the
statement of cash flows and the notes, and is accompanied by the directors' report on
operations.
Statement of financial position schedules are prepared according following methodologies:
The format adopted for the Statement of Financial Position distinguishes between
current and non-current assets and liabilities.
The income statement format adopted provides for the classification of costs by
nature, more representative than “destination one”. The Company opted to present
the items of profit or loss for the year in a single statement of comprehensive income,
which includes the result for the period and, by homogeneous categories, income and
expenses which, in accordance with IFRS, are posted directly to shareholders' equity.
The statement of cash flows analyses the cash flows deriving from the operating
activities using the indirect method, whereby the profit (loss) for the period is adjusted
for the effects of non-monetary transactions, any deferrals or provisions relating to
previous or future operating receipts or payments and the revenue or cost items
connected with cash flows deriving from investing or financing activities.
The statement of changes in shareholders' equity includes, in addition to total
profits/losses for the period, the amounts of transactions with equity holders and
changes in reserves during the period.
The schedules of the financial position, the comprehensive income statement, the statement
of changes in shareholders' equity and the cash flow statement are presented in units of Euro;
the values shown in the explanatory notes are expressed in thousands of Euros.
2 Accounting principles
General principles
The separate financial statements were drawn up in the perspective of business continuity,
with the presentation currency consisting of the Euro and the amounts shown are rounded to
the nearest unit, including, unless otherwise indicated, the amounts highlighted in the
accompanying notes.
The general principle adopted in preparing these separate financial statements is that of cost,
with the exception of derivative financial instruments, which are measured at fair value.
As regards the details of the accounting principles adopted, unless otherwise indicated, the
principles for the separate financial statements are the same as those reported in the
dedicated section of the Group's consolidated financial statements to which reference should
be made.
The information relating to the main risks and uncertainties has been summarized in the
management report.
Equity investments
Subsidiaries are companies over which the Company independently has the power to
determine the strategic choices of the company in order to obtain the related benefits.
Generally, the existence of control is assumed when one holds, directly and indirectly, more
than half of the voting rights exercisable in the ordinary shareholders' meeting, also
considering the so-called potential votes, that is, the voting rights deriving from convertible
instruments.
115 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
115 |
Equity investments in subsidiaries and associates are valued at the purchase cost, possibly
reduced in the event of distribution of capital or capital reserves or in the presence of
impairment losses determined by applying the so-called impairment test.
If the conditions for a previously made write-down no longer exist, the book value of the
investment is reinstated with recognition in the income statement, within the limits of the
original cost.
3 Fair value measurement
In relation to financial instruments measured at fair value, the classification of these
instruments based on the hierarchy of levels provided for by IFRS 13 is shown below, which
reflects the significance of the inputs used in determining fair value. The following levels can
be distinguished:
Level 1 - unadjusted quotations recognized on an active market for the assets or liabilities being
measured;
Level 2 - inputs other than the quoted prices mentioned in the previous point, which are
observable on the market, either directly (as in the case of prices) or indirectly (i.e., derived
from prices);
Level 3 – inputs that are not based on observable market data.
As of December 31, 2021 and 2020, no assets or liabilities held by the company are measured
at fair value.
4 Risks to which the Company is exposed
Risks deriving from exchange rate fluctuations
The Group is subject to the market risk deriving from exchange rate fluctuations, as it operates
in an international setting, with transactions carried out in different currencies. Exposure to
risk arises both from the geographical distribution of the business and from the various
countries in which purchases are made.
Risks deriving from changes in interest rates
Since financial debt is mainly regulated by variable interest rates, it follows that the Group is
exposed to the risk of their fluctuation. The trend of interest rates is constantly monitored by
the Company and depending on their changes it will be possible to evaluate the opportunity
to adequately hedge the interest rate risk. The Group is currently not hedged, considering the
insignificant impact on the income statement of interest rate changes.
Derivative financial instruments (for exchange rate hedging) in relation to which it is not
possible to identify an active market, are recorded at fair value and are included in the items
of financial assets and liabilities and other assets and liabilities. The relative fair value was
determined using valuation methods based on market data, in particular by using specific
pricing models recognized by the market.
Price risk
The price risk is represented by the possibility that the value of a financial asset or liability
varies as a result of changes in market prices (other than those relating to currencies and
rates).
This risk is typical of financial assets not listed on an active market which cannot always be
realized quickly at a value close to their fair value.
This risk, given the size of the investments in place, is not significant and therefore is not
hedged
Credit risk
Credit risk is the Group’s exposure to potential losses that may result from the failure to meet
obligations with counterparts.
The receivables recorded essentially comprise receivables from final consumers for whom the
risk of nonrecovery is moderate and in any case of a minimum individual amount. The
Company has instruments for the preventive control of the solvency of each customer, as well
as instruments for monitoring and reminding of receivables through the analysis of collection
flows, payment delays and other statistical parameters.
Liquidity risk
The Group finances its activities both through the cash flows generated by its operations and
through the use of external sources of funding and is therefore exposed to liquidity risk,
represented by the fact that its financial resources are not sufficient to meet its financial and
commercial obligations in accordance with agreed terms and maturities. The Group's cash
flows, borrowing requirements and liquidity are controlled by considering the maturity of
financial assets (trade receivables and other financial assets) and the cash flows expected from
the related transactions. The Group has both secured and unsecured credit lines, consisting of
117 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
117 |
revocable short-term credit lines in the form of revolving loans, current account overdrafts and
signature loans.
5. Accounting standards
5.1 Accounting standards, amendments and interpretations endorsed and effective from 1
January 2021
Pursuant to IAS 8 "Accounting standards, changes in accounting estimates and errors", the IFRS
in force starting from January 1, 2021 are indicated below:
On January 14, 2021, the Commission Regulation (EU) 2021/25 of January 13, 2021 amending
Regulation (EC) no. 1126/2008 which adopts certain international accounting standards in
accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council,
as regards the International Accounting Standard IAS 39 Financial instruments: recognition and
measurement, and the International Financial Reporting Standards (IFRS) 4 Insurance
contracts, IFRS 7 Financial instruments: additional information, IFRS 9 Instruments financial
and IFRS 16 Leasing.
The Regulation implements at European level the amendments adopted on 27 August 2020 by
the International Accounting Standards Board of «Reform of the reference indexes of interest
rates - phase 2 - Amendments to IFRS 9, to IAS 39, to IFRS 7, to 'IFRS 4 and IFRS 16', which take
into account the consequences of the effective replacement of reference indices for the
determination of existing interest rates with alternative reference rates.
These amendments provide for a specific accounting treatment to spread over time the
changes in the value of financial instruments or leasing contracts due to the replacement of
the reference index for determining interest rates, thus avoiding immediate repercussions on
profit (loss). exercise and unnecessary termination of hedging relationships following the
replacement of the reference index for determining interest rates.
Companies apply the amendments to the European Regulation at the latest starting from the
start date of their first financial year starting on January 1, 2021 or later.
There are no impacts on the individual financial statements due to the application of these
changes
5.2 International accounting standards and / or interpretations issued but not yet entered
into force and / or not approved
The following are the new Standards or Interpretations already issued, but not yet entered
into force or not yet approved by the European Union at 31 December 2021 and therefore not
applicable. They are not expected to have a material impact on the Company's financial
statements at the date of application.
x Amendments to IAS 1 - Presentation of Financial Statements - Classification of Liabilities
as Current or Non-current
The amendments clarify the principles to be applied for the classification of liabilities as
current or non-current and specify that the classification of a liability is not affected by the
likelihood that the Group will exercise its right to defer settlement of the liability for at
least twelve months after the reporting period. The Group’s intention to liquidate in the
short term does not impact the classification. These amendments, which will take effect
on 1 January 2023, have not yet been endorsed by the European Union. At the current
valuation stage, no impact on the classification of financial liabilities is expected as a result
of these amendments.
x Amendments to IAS 16 - Property, plant and equipment - Proceeds before Intended Use
These amendments prohibit the deduction of proceeds from selling items from property,
plant and equipment while the item is being prepared for its intended use. The proceeds
from the sale of the products, and the related cost of production, must be recognised in
profit or loss. These amendments, which will take effect on 1 January 2022, have not yet
been endorsed by the European Union. At the current valuation stage, no impact on the
classification of financial liabilities is expected as a result of these amendments.
Amendments to IAS 37 - Provisions, Contingent Liabilities and Contingent Assets -
Onerous Contracts — Cost of Fulfilling a Contract
These amendments specify the costs to be taken into account when assessing onerous
contracts and specify that the “directly related costs” approach must be applied.
These amendments, which will take effect on 1 January 2022, have not yet been endorsed
by the European Union. At the current valuation stage, no impact on the classification of
financial liabilities is expected as a result of these amendments.
119 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
119 |
x Annual Improvements (2018 - 2020 cycle) issued in May 2020
These amendments are limited to certain standards (IFRS 1 First-time Adoption of IFRS,
IFRS 9 Financial Instruments, IAS 41 Agriculture and illustrative examples of IFRS 16 Leases)
which clarify the wording or correct omissions or conflicts between IFRS standards. These
amendments, which will take effect on 1 January 2022, have not yet been endorsed by the
European Union. At the current valuation stage, no impact on the classification of financial
liabilities is expected as a result of these amendments.
x Amendments to IAS 1 - Presentation of Financial Statements and IFRS Practice Statement
2: Disclosure on accounting standards
These amendments provide guidance for applying materiality judgments to accounting policy
disclosures in a way that is more useful; specifically:
• the obligation to indicate the “significant” accounting policies has been replaced with
the obligation to indicate the “material” ones;
• guidance has been added on how to apply the concept of materiality to accounting
policy disclosures.
In assessing the materiality of accounting policy disclosures, entities should consider both the
size of the transactions, other events or conditions, and their nature.
These amendments, which will take effect on 1 January 2023, have not yet been endorsed by
the European Union. At the current valuation stage, no impact on the classification of financial
liabilities is expected as a result of these amendments.
x Amendments to IAS 8 – Accounting Policies, Changes in Accounting Estimates and Errors
These amendments introduce a new definition of “accounting estimates,” particularly in terms
of the difference between accounting estimates and accounting policies and provide guidance
on determining whether changes should be treated as changes in estimates, changes in
accounting principles, or errors.
These amendments, which will take effect on 1 January 2023, have not yet been endorsed by
the European Union. At the current valuation stage, no impact on the classification of financial
liabilities is expected as a result of these amendments.
x Amendments to IFRS 16 Leases - Covid-19 related rent concessions
These amendments extend by one year the option to introduce optional accounting for lessees
in the event of permanent(rental holidays) or temporary rent reductions linked to Covid-19.
Lessees may choose to account for rent reductions as variable lease payments recognised
directly in profit or loss for the period in which the reduction applies or treat them as a
modification of the lease agreement with the resulting obligation to remeasure the lease
liability based on the revised consideration using a revised discount rate. This option is
applicable to reductions in lease payments for which payment is due on or before 30 June
2022. The amendment, in force since 1 April 2021, has not yet been endorsed by the European
Union.
x Amendments to IAS 12 – Income Taxes – Deferred Tax related to Assets and
Liabilities arising from a Single Transaction
These amendments eliminate the possibility of not recognising deferred taxes upon initial
recognition of transactions that give rise to taxable and deductible temporary differences (e.g.,
lease agreements).
These amendments also clarify that when lease payments are deductible for tax purposes, it is
a matter of judgment (after considering applicable tax law) whether such deductions are
attributable for tax purposes to the lease liability recorded on the balance sheet or to the
related right-of-use. If tax deductions are attributed to the right-of-use, the tax bases of the
right-of-use and lease liability are the same as their carrying amounts, and no temporary
differences arise upon initial recognition. However, if tax deductions are attributed to the lease
liability, the tax values of the right-of-use and lease liability are nil, giving rise to taxable and
deductible temporary differences, respectively. Even if the gross temporary differences are
equal, a deferred tax liability and a deferred tax asset must still be recognised.
These amendments, which will take effect on 1 January 2023, have not yet been endorsed by
the European Union. Impacts on the Group's financial statements following these amendments
are currently being analysed.
121 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
121 |
Notes
5. Intangible fixed assets
Intangible fixed assets almost entirely refer to the IT infrastructure and ERP of the company
also used for the purposes of the Group consolidation. The handling is shown below:
Euro thousand
Net carrying amount 01/01/2021 increases decreases amortizations reclassification 31/12/2021
Goodwill
0000 0
Trademarks & patents
0000 0
Software
177 63 0 (91) 47 196
Other intangibles assets
0000 0
Intangible assets under construction and advances
47 0 0 0 (47) 0
Net carrying amount intangible assets
224 63 0 (91) 0 196
INTANGIBLE FIXED ASSETS
6. Land, property, plant and equipment
The change in tangible fixed assets is shown below:
7. Equity investments
The item is detailed as follow:
Hystorical costs
01/01/2021
increases decreases amortizations reclassification
31/12/2021
Land and buildings
0
Plant and equipments
83 83
Equipment
0
Other
80 80
Tangible assets under construction and advances
0
Right of use assets
328 328
Total hystorical costs
491 0 0 0 0 491
Accumulated depreciation
01/01/2021
amortization divestments other changes
31/12/2021
Land and buildings
0
Plant and equipments
(10) (10) (20)
Equipment
0
Other
(10) (10) (20)
Right of use assets
(90) (60) (150)
Total accumulated depreciation
(110) (80) 0 0 0 (190)
Net Value 01/01/2021
increases divestments amortization other changes
31/12/2021
Land and buildings
000
Plant and equipments
73 (10) 63
Equipment
000
Other
70 (10) 60
Tangible assets under construction and advances
0 0
Right of use assets
238 (60) 178
Total Net Value
381 0 0 (80) 0 301
PROPERTY PLANT AND EQUIPMENT
Gross Value
PROPERTY PLANT AND EQUIPMENT
Accumulated depretiation
PROPERTY PLANT AND EQUIPMENT
Net Value
Euro thousand
Country
31.12.2021 31.12.2020
Subsidiaries
Giordano Vini SpA ITA 32.823 32.823
Provinco SpA ITA 21.433 21.433
Enoitalia SpA ITA 151.225 0
Total 205.481 54.256
123 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
123 |
8. Financial non current assets
They refer to medium-term loans granted to Giordano Vini S.p.A.
9. Deferred Tax Assets
Deferred taxation arises from the following temporary differences:
10. Trade receivable
Trade receivables at 31 December 2021 and 31 December 2020 are detailed below:
€thousand
31.12.2021
31.12.2020
Trade receivables
-
-
Trade receivables toward subsidiaries
2.282
269
Provision for writedown
-
-
Total
2.282
269
Value at 31 december 2020
Euro thousand
Description
Taxable Rate
Net value
Remunaration of Directors 354 24,00% 85
Total receivables for pre-paid taxes 85
Value at 31 december 2021
Euro thousand
Description
Taxable Rate
Net value
Remunaration of Directors 354 24,00% 85
Total receivables for pre-paid taxes 85
11. Current tax assets
The item at 31 December 2021 and 31 December 2020 is detailed below:
12. Other activitie
Other activities at 31 december 2021 and at 31 december 2020 are detailed as follow:
With effect from the 2016 period, the Parent Company (together with its subsidiaries Giordano
Vini S.p.A. and Provinco Italia S.p.A.) has opted for the national IRES tax consolidation scheme,
the effects of which are also reported in the economic and financial results at 31 december
2021.
Participation in tax consolidation is governed by specific regulations that apply throughout the
period of validity of the option.
The economic relations of tax consolidation are summarized below:
- for the years with positive taxable income, the subsidiaries pay to the consolidating
company the higher tax it owes to tax authorities;
€thousand
31.12.2021 31.12.2020
VAT receivables 171 81
IRAP receivables 75 93
IRES receivables 672 1.075
Withholdings IRPEF (93) (74)
Others 5 (8)
Total 830 1.167
€thousand
31.12.2021 31.12.2020
Tax consolidation receivables from subsidiaries 4.979 5.279
Advance payments to suppliers 3
Pre-payments and accrued incomes 1 13
Total 4.980 5.295
125 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
125 |
- consolidated companies with negative taxable income receive from the parent
company a compensation corresponding to 100% of the tax savings realized at Group
level and recorded on an accrual basis. Compensation is paid only when it is actually
used by the Parent Company, for itself and/or for other companies in the Group;
- in the event that the Parent Company and its subsidiaries do not renew the option for
national consolidation, or in the event that the requirements for continuing national
consolidation are no longer met before the end of the three-year period of validity of
the option, the tax losses carried forward resulting from the tax return are attributed
to the consolidating company or entity.
Enoitalia SpA wiil join Tax consolidation scheme starting from 2022.
8-13. Current and non current Financial Assets
Financial assets at 31 December 2021 and 31 December 2020 are detailed as in the following
table:
€thousand
31.12.2020
Short term
Medium term
(by 5 years)
Long term
Total
Buy back financial receivable (CFO) 57 57
Total others 57 - - 57
Giordano Vini 8.000 8.000
Provinco 3.000 3.000
Total Loans vs Subsidiaries 11.000 - - 11.000
4.100 4.100
Totale Shareholder Loans vs Subsidiaries - - 4.100 4.100
Total 11.057 - 4.100 15.157
14. Cash
Cash and cash equivalents at 31 December 2021 and 31 December 2020 are detailed as per
the following table:
€thousand
31.12.2021
Short term
Medium term
(by 5 years)
Long term
Total
Buy back financial receivable (CFO) 4 4
Total others 4 - - 4
Giordano Vini 8.000 8.000
Provinco - -
Enoitalia 11.000 11.000
Total Loans vs Subsidiaries 19.000
- - 19.000
10.000 18.100 28.100
Totale Shareholder Loans vs Subsidiaries - 10.000 18.100 28.100
Total 19.004 10.000 18.100 47.104
€thousand
31.12.2021 31.12.2020
Banks deposits 11.366 15.208
Total 11.366 15.208
127 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
127 |
15. Net Equity
The company's net equity is made up as follows:
Share capital
The share capital of Italian Wine Brands is equal to €1.046.265,80 divided into 8.802.077
ordinary shares, all without indication of the nominal value.
The extraordinary Shareholders' Meeting of Italian Wine Brands S.p.A. has approved, on
second call, the proposed non divisible capital increase against payment, for a total amount of
Euro 45,500,000.00 (of which Euro 166,412.10 as capital and Euro 45,333,587.90 as share
premium) (the "Reserved Capital Increase"). The Reserved Capital Increase provides for the
issue of a total of no. 1,400,000 new ordinary shares without nominal value, at a subscription
price of Euro 32.50 (including share premium), with the exclusion of option rights pursuant to
Article 2441, Paragraph 5 of the Italian Civil Code, to be reserved for subscription by Gruppo
Pizzolo S.r.l. ("Gruppo Pizzolo") and to be paid in cash, also by means of compensation.
The Reserved Capital Increase will be carried out in the context of an investment transaction
of IWB, which provides for the acquisition by the Company of the entire share capital of
Enoitalia S.p.A. and the reinvestment by Gruppo Pizzolo, the majority shareholder of Enoitalia,
in the share capital of IWB by means of the subscription and payment in cash, also by way of
compensation, of the Reserved Capital Increase.
The deal was finalized on 27 July 2021.
Amounts in EUR
31.12.2021 31.12.2020
Share capital 1.046.266 879.854
Legal reserve 175.971 175.971
Share premium reserve 109.899.034 64.565.446
Reserve for actuarial gains on defined benefit plans (1.766) (1.580)
Reserve for stock grants 267.330 343.908
Reserve for the purchase of treasury shares - (582.570)
Other reserves 2.971.166 2.971.165
Retained eaarnings 16.128.542 13.112.972
Profit/(loss) of the period 9.779.891 7.799.008
Total reserves 139.220.168 88.384.320
Total shareholders’ equity 140.266.434 89.264.174
Shareholders’ equity of NCIs - -
Total shareholders’ equity 140.266.434 89.264.174
Reserves
The share premium reserve was generated as a result of listing that took place in 2015 and
increased as explained in previous paragraph
The reserve for defined-benefit plans is generated by the actuarial profits/(losses) deriving
from the valuation of the accrued termination benefits in accordance with IAS 19.
Other reserves include €3,112 thousand in the reserve for transactions "under common
control" generated by the first consolidation of the company Giordano Vini S.p.A. during the
first half of 2015, net of a negative reserve of €498 thousand generated by the direct
recognition in equity, in accordance with IAS 32, of the expenses incurred by the parent
company in relation to the aforementioned capital transactions net of the related deferred
taxes.
At 31 December 2021 the Parent Company held 6.092 ordinary shares, representing 0.08% of
the ordinary share capital in circulation.
The reconciliation schedule between the shareholders' equity and the result of the parent
company and those of the consolidated companies is set out below:
16. Financial liabilities
The situation as at 31 December 2021 is as follows:
€thousand
31.12.2020
Short term
Medium term
(by 5 years)
Long term
Total
Right-of-use liabilities
- 216 -
216
Total
- 216 -
216
€thousand
31.12.2021
Short term
Medium term
(by 5 years)
Long term
Total
Bond - - 130.795 130.795
Right-of-use liabilities - 146 - 146
Total - 146 130.795 130.941
129 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
129 |
The bank debt as of December 31, 2021 consists of the following loans:
• Senior bond, non-convertible, unsubordinated and unsecured, of Euro 130 million issued by
Italian Wine Brands S.p.A. on May 13, 2021 with a duration of 6 years (maturity May 13, 2027),
bullet repayment, annual fixed rate of 2.50%, annual interest. The bond loan is listed on the
MOT market managed by Borsa Italiana and on the Irish Stock Exchange managed by Euronext
Dublin.
Financial payables are recognized in the balance sheet at the value resulting from the
application of the amortized cost, determined as the initial fair value of the liabilities net of the
costs incurred to obtain the loans, increased by the accumulated amortization of the difference
between the initial value and the maturity, calculated using the effective interest rate la where
the application of the amortized cost method is not relevant compared to the nominal value
The aforementioned loan agreements have similar clauses and practices for this type of
transaction, such as, for example: (i) provision of a financial covenant (calculation envisaged at
the Italian Wine Brands Group level) based on the performance of certain financial parameters
at consolidated Group level; (ii) disclosure obligations in relation to the occurrence of
significant events for the Company, as well as corporate disclosure; (iii) commitments and
obligations, usual for financing transactions of this kind, such as, by way of example, limits on
the assumption of financial debt and the sale of one's assets, prohibition on distributing
dividends or reserves where certain financial parameters are not respected.
17. Termination benefits
Defined contribution plans
In the case of defined contribution plans, the Company pays contributions to public or private
insurance institutions on the basis of a legal or contractual obligation, or on a voluntary basis.
By paying the contributions, the Group fulfils all its obligations.
Payables for contributions to be paid at the reporting date are included in the item "Other
current liabilities"; the cost pertaining to the period accrues on the basis of the service
rendered by the employee and is recorded in the item "Personnel costs" in the area of
belonging.
Defined benefit plans
Employee benefit plans, which can be classified as defined benefit plans, are represented by
the termination benefits (TFR); the liability is instead determined on an actuarial basis using
the "projected unit credit" method. Actuarial gains and losses determined in the calculation of
these items are shown in a specific equity reserve. The changes in the liability for termination
benefits at 31 December 2021 are shown below:
The component "allocation of costs for employee benefits" and "contribution/benefits paid"
are recorded in profit or loss under the item "Personnel costs" in the area to which they refer.
The component "financial income/(expenses)" is recognized in profit or loss under "Financial
income/(expenses)", while the component "actuarial income/(expenses)" is recognized under
other comprehensive income and transferred to a Shareholders' equity reserve called "Reserve
for defined benefit plans".
At 31 December2021 the main actuarial assumptions used at the end of 2020 have been
confirmed as follows:
19. Trade payables
This item includes all trade payables which have the following geographical distribution:
€thousand
2021 2020
Provision at 1 January
24
16
Provisions
13
8
Benefits paid out in period - -
Actuarial (gains)/losses - -
Borrowing costs - -
Provision at end of period 37 24
Actuarial assumptions 31.12.2021 31.12.2020
Discount rate (0,25%) (0,10%)
Inflation rate 2,28% 1,20%
Expected average turnover 8,98% 8,62%
€thousand
31.12.2021 31.12.2020
Suppliers Italy 210 117
Suppliers Foreign markets 1 -
Subsidiaries - 4
Total 211 121
131 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
131 |
20. Other liabilities
The Other liabilities are made up as follows:
21. Revenues from sales and other revenues
Revenues from sales relate to services rendered to subsidiaries and regulated by contracts
22. Purchase costs
The costs for purchases refer to office materials.
€thousand
31.12.2021 31.12.2020
Consolidated Tax Payables vs Subsidiaries - 1.778
Employees 407 135
Social security institutions 63 53
Directors 598 354
Accruals and deferred income - 31
Others 6 -
Total current 1.074 2.351
23. Services
The costs for services at 31 December 2021, compared with those of the previous year, are
detailed below:
The fees to directors, statutory auditors and the control body are detailed as follows
€thousand
31.12.2021
31.12.2020
Services from third parties
206 179
Rent and leasing
15
15
Consulting
328 410
Advertising costs
16 12
Utilities
9 8
Remuneration of Directors, Statutory Auditors and Supervisory Body
1.083 797
Others
116
44
Total
1.773 1.465
€thousand
31.12.2021 31.12.2020
Directors 1.039 766
Statutory auditors 44 31
Total 1.083 797
133 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
133 |
24. Personnel cost
Personnel costs at 31 December 2021, compared with those of the previous year, are detailed
below:
The following table shows the number of employees
25. Other operating costs
The item Other operative costo amounts to euro 213 thousands (euro 462 thousands in 2020)
€thousand
31.12.2021
31.12.2020
Wages and salaries 525 442
Social security charges 175 164
Termination benefits 13 8
Stock grant 289 164
Other costs 15 18
Total 1.017 796
N. puntuale N. medio
31.12.2021 31.12.2021
Executives 43
Middle managers 21
Total
64
26. Financial income and charges
Financial income and expenses are detailed in the following tables:
In detail, interest on financial liabilities includes:
• interest expense on medium / long-term loans;
• commissions and bank charges including those for sureties.
€thousand
31.12.2021
31.12.2020
Dividends
12.402
9.152
On current accounts
2 19
Intercompany
512
174
Others
- -
Total
12.916 9.345
€thousand
31.12.2021
31.12.2020
Bond interests
(2.205)
Loans
- -
Right-of-use liabilities
(7) (9)
Bank current accounts
- -
Bank's commiss ions
(3)
(3)
Others
(158) -
Total
(2.373) (12)
135 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
135 |
27. Taxes
Taxes at 31 December 2021, compared with those of the previous year, are detailed below:
28. Transactions with related parties
At 31December 2021 there were:
(i) service contracts with Electa SpA concerning respectively (a) support for the
preliminary analyzes and the executive definition of M&A projects for an amount
equal to Euro 80 thousand (b) services to support the analysis of possible financing
alternatives, the definition of the terms and conditions of the loans, the review of
the documentation and the fulfillment of the related corporate obligations for an
amount equal to € 100 thousand (c) support for investor relations activities for an
amount equal to € 40 thousand
The above relationship is regulated at conditions at arm’s length.
(ii) It should also be noted that, as detailed in the paragraph Significant events of the
year for the acquisition of 55% of Enovation Inc the Company's Board of Directors
approved the transaction subject to the favourable opinion issued by the
Company's Independent Director, Antonella Lillo, regarding the signing of the sale
and purchase agreement with Norina, as well as on the appropriateness and
fairness of the related conditions. This opinion was issued because Norina is a
€thousand
31.12.2021
31.12.2020
IRES
(934) (414)
IRAP
- -
Taxes for prior periods
(52) 4
(Losses)/revenues from tax consolidation
Total current taxes (986) (410)
Prepaid taxes
- (85)
Deferred taxes
- -
Total deferred taxes - (85)
Total (986) (495)
“related party” of the Company as it belongs to the four family branches of the
Pizzolo family, including the Vice Chairman of IWB, Giorgio Pizzolo, and the director
of IWB, Marta Pizzolo. It should be noted that the sale and purchase of the Norina
Shareholding qualifies as a related-party transaction of “less importance” pursuant
to the “Procedure for transaction with related party” adopted by the Company and
the Regulation approved by Consob with resolution No. 17221/2010.
29. Atypical and unusual transactions
Pursuant to Consob communication no. DEM/6064293 of 28 July 2006, during the period the
Group did not carry out atypical or unusual transactions, as defined by the communication
itself, according to which atypical and/or unusual transactions are those that, due to their
significance/relevance, the nature of the counterparties, the object of the transaction, the
method of determining the transfer price and the timing of the event, may give rise to doubts
regarding: the correctness/completeness of the information in the financial statements, the
conflict of interest, the safeguard of the company's assets, the protection of non-controlling
interests.
*****
For the Board of Directors
The Chairman and Chief Executive Officer
Alessandro Mutinelli
APPENDIX
137 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
137 |
TRANSITION TO INTERNATIONAL ACCOUNTING STANDARDS (IAS / IFRS)
1. Introduction
The adoption of the IAS / IFRS accounting standards for the preparation of the financial
statements as of 31 December 2020 does not respond to a regulatory obligation, but derives
exclusively from the need to provide greater completeness in the communication on the
Company's income and financial dynamics towards the recipients financial statements, also in
consideration, on the one hand, of the listing on the AIM market of Borsa Italiana and, on the
other hand, of the issuance of listed debt instruments, favoring greater transparency and
quality of financial reporting and greater clarity in company policies also for international
financial communication purposes.
The transition date to the IAS / IFRS principles is represented by January 1, 2020, or the first
day of the financial year presented for comparative purposes. This section shows the
reconciliation statements required by IFRS 1 ('First time adoption of International Financial
Reporting Standards), together with the related explanatory notes concerning the effects
deriving from the adoption of these principles.
The structure of the reconciliation statements is also in line with what is suggested by
paragraph 63 of the Interpretation Guidance of IFRS 1.
In application of the provisions of paragraphs 39 and 40 of the IFRS1 International Accounting
Standard, this Appendix contains the reconciliation statements of the net result for the year
ended 31 December 2020 and of the shareholders' equity as of 1 January 2020 and December
31, 2020.
The company has applied the IAS / IFRS principles retroactively. In particular, in accordance
with the requirements of IFRS 1, on the date of transition to the new standards (1 January
2020) a balance sheet was prepared according to the IAS / IFRS, which reflects the application
of the following general criteria.
The assets were recognized when they can be entered on the basis of IAS / IFRS and valued in
accordance with these principles.
The items in the financial statements have been classified according to the methods
established by the IAS / IFRS, with consequent reclassification with respect to what is reflected
in the accounting situations drawn up on the basis of the Italian accounting principles
previously in force.
The effect of the adjustment to the new principles of the initial balances of assets and liabilities
was recognized in equity, in a specific item of reserves.
2. Methods of presentation, optional exemptions and accounting options adopted
The reworking of the statements as of January 1, 2020 and December 31, 2020 required some
preparatory choices regarding the presentation methods and the optional exemptions and
accounting options provided for by the IAS / IFRS, referred to below.
2.1. Presentation method
The adopted 'Balance Sheet' scheme (balance sheet) reflects the classification of the items
according to the current / non-current criterion while, for the 'Income Statement' scheme, it
was decided to adopt the scheme with the classification of costs' for nature'.
2.2. Optional exemptions and accounting options provided for by IFRS 1
In preparing the opening IFRS balance sheet, the Company, in accordance with the provisions
of IFRS 1, used all the mandatory exceptions and some of the optional exemptions relating to
the retrospective application of the IFRS, analyzed below.
4. Optional exemptions from the complete retrospective application of IFRSs chosen by the
Company
Business combinations
139 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
139 |
Not applicable.
Fair value or cost revalued as an estimated cost
The Company made use of the optional exemption provided for by IFRS 1 ("fair value or
revaluation as a substitute for cost").
Compound financial instruments
Not applicable.
Adjustment of comparative information relating to financial assets and liabilities
Not applicable.
Designation of previously recognized financial instruments
Not applicable.
Share-based payments to employees
The company did not make use of this option but applied IFRS2 retrospectively.
Insurance contracts
Not applicable.
Changes in liabilities recognized for dismantling, restorations and similar liabilities included
in the cost of real estate, plant and machinery
Not applicable.
5. Mandatory exceptions for the retrospective application of IFRS followed by the Company
The Company has implemented the following mandatory exceptions relating to retrospective
application:
Derecognition of financial assets and liabilities
Financial assets and liabilities that do not meet the requirements of IAS 39 to be eliminated
from the financial statements, even if canceled before the transition date, must not be
recognized in the financial statements.
Hedge Accounting
It is not applicable.
Estimates
The estimates made by the Company at the transition date according to IFRS must comply with
the estimates made at the same date according to the previous accounting principles (after
the necessary adjustments to reflect any differences in the accounting principles), unless there
is objective evidence that such estimates are incorrect.
Non-current assets held for sale and discontinued operations
Not applicable.
The Company has decided to make use of the following main exemptions provided for by the
IFRS at the time of first application:
Valuation of intangible fixed assets and tangible fixed assets
Intangible fixed assets and tangible fixed assets have been entered according to the cost
criterion. On first-time application, the reworking of the balance sheet at the date of transition
to the IFRS international standards did not entail the adoption of the optional exemption
envisaged by IFRS 1 which allows for the substitution of fair value at historical cost as a
valuation criterion for tangible and intangible fixed assets.
3. Effects of the adoption of IAS / IFRS - Reconciliations required by IFRS 1
This note describes the effects resulting from the adoption of the IAS / IFRS on the financial
statements for the year 2020 and on the financial statements of previous years. These effects,
as required by IFRS 1, are presented and illustrated with relative reconciliation with respect to
141 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
141 |
the corresponding values, published at the time, determined according to national accounting
standards.
3.1 First adoption of the IAS / IFRS - January 1, 2020
The following tables include the summary of the effects on shareholders' equity at January 1,
2020 and December 31, 2020 and on the 2020 income statement of the transition to IAS / IFRS:
BALANCE SHEET
2019 1 2 3 4 5 2019
Amounts in EUR
ITA GAAP
Partecipation
in Provinco
Stock
grant
Plant and
expansion
costs
Right of
use
Employe
e
benefits
IFRS
Non-current assets
Intangible fixed assets 193.565 193.565
Tangible fixed assets 163.227 297.676 460.903
Equity investments 51.244.665 3.011.318 54.255.983
Other non-current assets 4.100.000 4.100.000
Total non-current assets
55.701.457 3.011.318 - - 297.676 -
59.010.451
Current assets
Trade receivables 69.321 69.321
Other current assets 133.529 133.529
Current tax assets 2.212.515 2.212.515
Current financial assets 13.172.784 13.172.784
Cash and cash equivalents 9.587.139 9.587.139
Total current assets
25.175.288 - - - - -
25.175.288
Total assets
80.876.745 3.011.318 - - 297.676 -
84.185.739
Shareholders’ equity
Share capital
879.854
879.854
Reserves
65.225.476 (484.058)
64.741.418
Own shares
(2.800.816)
(2.800.816)
FTA Reserve
- 3.011.318 (39.591) (562)
2.971.165
Stock grant reserve
- 623.887
623.887
Valuation Reserve
- (1.580)
(1.580)
Profit (losses) carried forward
7.167.059 (623.887) 484.058
7.027.230
Net Result of the period
6.825.552
6.825.552
Total Net equity
77.297.125 3.011.318 - - (39.591) (2.142)
80.266.710
Non-current liabilities
Financial liabilities - 283.819 283.819
Provision for the other employee benefits 13.837 2.142 15.979
Total non current liabilities
13.837 - - - 283.819 2.142
299.798
Current liabilities
Financial payables 53.448 53.448
Trade payables 327.608 327.608
Other current liabilities 165.607 165.607
Current tax liabilities 3.072.568 3.072.568
Total current liabilities 3.565.783 - - - 53.448 - 3.619.231
Total Net Equity and liabilities 80.876.745 3.011.318 - - 297.676 - 84.185.739
PROFIT AND LOSS 2020 1 2 3 4 5 2020
Amounts in EUR
ITA GAAP
Partecipatio
n in
Provinco
Stock grant
Plant and
expansion
costs
Right of use
Employee
benefits
IFRS
Revenue from sales
820.411
820.411
Other Revenues
36.422
36.422
Total revenue
856.833 - - - - -
856.833
Costs for services
(1.879.441) 351.277 62.500
(1.465.664)
Personnel costs
(723.518) (71.298)
(794.816)
Other operating costs
(463.967)
(463.967)
Operating costs
(3.066.926) - 279.979 - 62.500 -
(2.724.447)
EBITDA
(2.210.093) - 279.979 - 62.500 -
(1.867.614)
Depreciation and amortization
(102.605) (59.535)
(162.140)
0
0
0
0
Operating profit/(loss)
(2.312.698) - 279.979 - 2.965 -
(2.029.754)
Net financial income
9.344.735
9.344.735
Net financial (expenses)
(2.500) (9.052)
(11.552)
Net financial income/(expenses)
9.342.235 - - - (9.052) -
9.333.183
EBT
7.029.537 - 279.979 - (6.087) -
7.303.429
Taxes
Taxes 495.579 495.579
NET RESULT 7.525.116 - 279.979 - (6.087) - 7.799.008
BALANCE SHEET
2020 1 2 3 4 5 2020
Amounts in EUR
ITA GAAP
Partecipatio
n in
Provinco
Stock grant
Plant and
expansion
costs
Right of use
Employee
benefits
IFRS
Non-current assets
Intangible fixed assets 223.855 223.855
Tangible fixed assets 142.850 238.141 380.991
Equity investments 51.244.665 3.011.318 54.255.983
Other non-current assets 4.100.000 4.100.000
Deferred tax assets 85.012 85.012
Total non-current assets
55.796.382 3.011.318 - - 238.141 -
59.045.841
Current assets
Trade receivables 69.321 69.321
Other current assets 72.967 72.967
Current tax assets 1.252.032 1.252.032
Current financial assets 16.479.584 16.479.584
Cash and cash equivalents 15.208.143 15.208.143
Total current assets
33.082.047 - - - - -
33.082.047
Total assets
88.878.429 3.011.318 - - 238.141 -
92.127.888
Shareholders’ equity
Share capital
879.854
879.854
Reserves
65.225.476 (484.058)
64.741.418
Own shares
(582.570)
(582.570)
FTA Reserve
- 3.011.318 (39.591) (562)
2.971.165
Stock grant reserve
- 343.908
343.908
Valuation Reserve
- (1.580)
(1.580)
Profit (losses) carried forward
13.252.801 (623.887) 484.058
13.112.972
Net Result of the period
7.525.116 - 279.979 - (6.087) -
7.799.008
Total Net equity
86.300.677 3.011.318 - - (45.678) (2.142)
89.264.175
Non-current liabilities
Financial liabilities - 216.013 216.013
Provision for the other employee benefits 21.488 2.142 23.630
Total non current liabilities
21.488 - - - 216.013 2.142
239.643
Current liabilities
Financial payables 1.778.000 67.806 1.845.806
Trade payables 120.801 120.801
Other current liabilities 646.402 646.402
Current tax liabilities 11.061 11.061
Total current liabilities 2.556.264 - - - 67.806 - 2.624.070
Total Net Equity and liabilities 88.878.429 3.011.318 - - 238.141 - 92.127.888
143 | CONSOLIDATED ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2021
143 |
Notes
1) IAS 27 / Equity investment in Provinco Italia SpA
On the basis of IAS 27, dividends received by a subsidiary are always recognized in the income
statement, regardless of whether they are the distribution of profit or capital reserves. Any
reductions in value resulting from the distribution must then be assessed through an
impairment test. Following the acquisition of Provinco Italia SpA which took place in 2015, the
first dividend received, referring to the distribution of the pre-acquisition profit for 3,011
thousand euros, was deducted from the book value of the investment, on the basis of the OIC
accounting principles. at the time in force.
2) IFRS 2 / Stock grant
The Group also pays its top management through stock grant plans. In such cases, the
theoretical benefit attributed to the interested parties is charged to the income statement in
the years taken as a reference by the plan, with a balancing entry in an equity reserve. This
benefit is quantified by measuring at the grant date the fair value of the instrument assigned
through financial valuation techniques, including any market conditions in the valuation and
adjusting the number of rights believed to be assigned to each balance sheet date. This cost is
recognized as a balancing entry in a shareholders' equity reserve.
3) IAS 32 / Accessory charges to share capital increases
According to IAS 32, the charges incurred at the time of listing in 2015 cannot be capitalized
among intangible assets but the amount incurred must be used as a direct reduction of
shareholders' equity. In relation to the aforementioned capital increase, the amortization
process of start-up and expansion costs ended on 31 December 2019, therefore the only
impact relates to a reclassification between the share premium reserve and retained earnings,
while the balance sheet at transition date is not affected by any reduction linked to the reversal
of intangible fixed assets.
4) IFRS 16 / Rights of use assets
According to IFRS 16, lease agreements, including real estate leases, as in the specific case, are
accounted for as rights of use in non-current assets with a financial liability as a contra entry.
The cost of the rental is broken down into its components of financial charge, recognized in
the income statement during the term of the contract, and repayment of the capital, recorded
as a reduction of the financial liability. The right of use is amortized on a monthly basis on a
straight-line basis over the shorter period between the useful life of the asset and the duration
of the contract.
Usage rights and financial liabilities are initially valued at the present value of future
discounted payments using the marginal loan rate
The adjustment reported in the reconciliation of the accounts at 31 December 2019 and 2020
is affected by the accounting based on the financial method, while based on the national
accounting standards, the rents have been recognized in the income statement on an accruals
basis.
5) IAS 19 / Employee benefits
On the basis of IAS 19, the employee benefits paid after the termination of the employment
relationship ("post employment benefits") and any other long term benefits ("other long term
benefits") are subject to actuarial valuations to express the value current liability of the
accrued liability towards the employee at the balance sheet date.
The reported adjustment represents the effect of the actuarial profits resulting from the
valuation of the severance indemnity according to IAS 19. This adjustment passes directly from
equity.