Notes to
the Unaudited Condensed Interim Consolidated Financial
Statements
(Amounts in millions, except
otherwise indicated)
Free translation from the original
prepared in Spanish for publication in Argentina
1.
The Group’s business
and general information
These Financial Statements have been
approved for issuance by the Board of Directors, on November 8,
2017.
IRSA was founded in 1943, and it is
engaged in a diversified range of real estate activities in
Argentina since 1991. IRSA and its subsidiaries are collectively
referred to hereinafter as “the Group”. Cresud is our
direct parent company and IFIS Limited is our ultimate parent
company. The Group has established two Operations Centers,
Argentina and Israel, to manage its global business, mainly through
the following companies:
(i)
Remains in current and non-current assets, as
financial asset held for sale.
(ii)
Corresponds to Group’s associates, which
are hence excluded from consolidation.
(iii)
Disclosed in group of assets and liabilities
held for sale.
Within the operations center in
Israel and in relation with IDBD’s financial position, its
cash flow and its ability to meet its financial commitments, the
following should be taken into consideration:
●
Since September 2016, after the sale of Adama
and the increase in its subsidiaries’ market value, IDBD
considers that it is possible to obtain new financing or refinance
its actual debts. In this regard, IDBD has recently successfully
completed issuance of debentures, as mentioned in Note 20 to the
Consolidated Financial Statements as of June 30, 2017.
Additionally, it has made early repayments of its financial debt
and has managed to renegotiate the related financial
restrictions.
●
As mentioned in Note 7 to the Consolidated
Financial Statements as of June 30, 2017, DIC declared dividends,
out of which IDBD received approximately NIS 271 (equivalent to
approximately Ps. 1,219), net of the exercise of warrants mentioned
in Note 4.C to the Consolidated Financial Statements as of June 30,
2017.
IRSA Inversiones
y Representaciones Sociedad Anónima
●
In February 2017, Standard & Poor’s
Maalot (S&P Maalot) upgraded the rating of IDBD debentures,
from CCC to BB. Subsequently, in July 2017, S&P Maalot
increased the rating again to BBB with stable outlook.
●
As mentioned in Note 14 to the Consolidated
Financial Statements as of June 30, 2017, IDBD sold part of its
stake in Clal and signed a swap agreement for the future
sale.
Given the reasons described above,
IDBD considers that it has enough resources to continue operating
for at least 12 months after the date of these Financial
Statements.
It should be noted that the
IDBD’s Board of Directors has in place a cash flow forecast
to June 30, 2019, which assumes that IDBD will receive cash from
the realization of private investments directly held by IDBD. As a
result, IDBD expects to honor all its liabilities until the second
quarter of 2019. Even though consummation of such plans does not
depend entirely on factors under its control, IDBD believes it will
succeed in finalizing these or other plans.
Based on the foregoing, IDBD’s
management considers that there are currently no material
uncertainties regarding its ability to operate as a going concern,
given its current financial position and its ability to fulfil its
financial commitments in time and in due form and its capacity to
carry out its business plan.
Notwithstanding the foregoing, IDBD
should pay financial liabilities for NIS 1,413 (equivalent to
approximately Ps. 6,740 as of the closing date of these Financial
Statements) in November 2019, that payment would be affected by
factors that are out of IDBD control, such as, its ability to carry
out its plans to sell its equity interest in Clal considering the
scheme determined by the “Capital Market, Insurance and
Saving Commission of Israel” (“the
Commissioner”), the requirements of the “Act to Promote
Competition and Reduce Concentration” (“Concentration
Act”) and its ability to deal with the implications of the
Concentration Act and to comply with the restrictions set out
therein regarding the control of companies through a pyramidal
structure (Note 7 to the Consolidated Financial Statements as of
June 30, 2017), among others.
IDBD expects that the consideration
to be received from the sale of Clal pursuant to the
Commissioner’s scheme, (i.e., the sale in tranches of 5% each
every four months) to the extent it is implemented, will be lower
and even significantly lower as compared to a block sale of its
controlling interest in Clal However, even if Clal’s shares
continue to be sold in accordance to the scheme established by the
Commissioner, IDBD’s management considers that it would as
well have additional sources of cash flows available to satisfy its
commitments in November 2019. IDBD’s management considers
that it will be able to address its commitments timely and continue
with its operations.
It should be noted that the
financial position of IDBD and its subsidiaries at the Operations
Center in Israel does not affect the financial position of IRSA and
subsidiaries at the Operations Center in Argentina.
In addition, the commitments and
other covenants resulting from IDBD’s financial debt do not
have impact on IRSA since such indebtedness has no recourse against
IRSA and it is not granted by IRSA’s assets.
2.
Summary of significant
accounting policies
2.1.
Basis of preparation of the
Financial Statements
These Financial Statements have been
prepared in accordance with IAS 34 "Interim Financial Reporting",
therefore, should be read together with the Annual Financial
Statements of the Group as of June 30, 2017 prepared in accordance
with IFRS in force. Furthermore, these Financial Statements include
supplementary information required by Law N° 19,550 and/or
regulations of the CNV. Such information is included in notes to
these Financial Statements according to IFRS.
IRSA Inversiones
y Representaciones Sociedad Anónima
These Financial Statements
corresponding to the interim three-month periods ended September
30, 2017 and 2016 have not been audited. The management considers
they include all necessary adjustments to fairly present the
results of each period. The Company’s interim periods results
do not necessarily reflect the proportion of the Group’s
full-year results.
Under IAS 29 “Financial
Reporting in Hyperinflationary Economies”, the Financial
Statements of an entity whose functional currency belongs to a
hyperinflationary economy, regardless of whether they apply
historic cost or current cost methods, should be stated at the
current unit of measure as of the date of this Consolidated
Financial Statements. For such purpose, in general, inflation is to
be computed in non-monetary items from the acquisition or
revaluation date, as applicable. In order to determine whether an
economy is to be considered hyperinflationary, the standard lists a
set of factors to be taken into account, including an accumulated
inflation rate near or above 100% over a three-year
period.
For the Groups' business in
Argentina, considering the released inflation data in Argentina and
the declining inflation trend in recent years, the Board of
Directors is of the view that there is not enough evidence to
conclude that Argentina is a hyperinflationary economy. Therefore,
no restatement has been applied on financial information, as set
forth by IAS 29, for the reporting periods. However, over the last
years, certain macroeconomic variables, such as payroll costs and
input prices, have experienced significant annual changes, which
should be taken into consideration in assessing and interpreting
the financial situation and results of operations of the Company in
these Financial Statements.
b.
Recast of Financial
Statements previously issued due to change in accounting
policies
As mentioned in Note 2 to the
Consolidated Financial Statements as of June 30, 2017, during the
fiscal year ended June 30, 2017 the Group’s Board of
Directors decided to change the accounting policy for investment
property from cost model to fair value model, as permitted under
IAS 40. Therefore, the previously issued Interim Financial
Statements were retroactively recast as required by IAS
8.
The table below includes the
reconciliation between the Statements of Income and the Statements
of Comprehensive Income / (operations) for the three-month period
ended September 30, 2016 as they were originally issued, and the
recast statements included in these Financial Statements for
comparative purpose. There is no impact on any of the relevant
total sums of the Consolidated Statement of Cash
Flows.
|
09.30.2016
(originally
issued)
|
|
09.30.2016
(adjustment)
|
|
09.30.2016
(other reclassifications) g)
|
|
09.30.2016
(recast)
|
Revenues
|
18,687
|
|
-
|
|
(900)
|
|
17,787
|
Costs
|
(13,267)
|
|
262
|
a)
|
679
|
|
(12,326)
|
Gross
profit
|
5,420
|
|
262
|
|
(221)
|
|
5,461
|
Gain from
disposal of investment properties
|
19
|
|
(19)
|
b)
|
-
|
|
-
|
Net gain from
fair value adjustment of investment properties
|
-
|
|
1,396
|
c)
|
-
|
|
1,396
|
General and
administrative expenses
|
(934)
|
|
-
|
|
82
|
|
(852)
|
Selling
expenses
|
(3,296)
|
|
-
|
|
127
|
|
(3,169)
|
Other operating
results, net
|
(62)
|
|
-
|
|
(7)
|
|
(69)
|
Profit
from operations
|
1,147
|
|
1,639
|
|
(19)
|
|
2,767
|
Share of (loss)
/ profit of associates and joint ventures
|
(43)
|
|
25
|
d)
|
27
|
|
9
|
Profit
before finance results and income tax
|
1,104
|
|
1,664
|
|
8
|
|
2,776
|
Finance
income
|
388
|
|
-
|
|
(108)
|
|
280
|
Finance
costs
|
(2,124)
|
|
-
|
|
93
|
|
(2,031)
|
Other financial
results
|
262
|
|
-
|
|
-
|
|
262
|
Financial
results, net
|
(1,474)
|
|
-
|
|
(15)
|
|
(1,489)
|
(Loss) /
Profit before income tax
|
(370)
|
|
1,664
|
|
(7)
|
|
1,287
|
Income
tax
|
(54)
|
|
(538)
|
e)
|
-
|
|
(592)
|
(Loss) /
Profit from continuing operations
|
(424)
|
|
1,126
|
|
(7)
|
|
695
|
Loss from
discontinued operations
|
(358)
|
|
-
|
|
7
|
|
(351)
|
(Loss) /
Profit for the period
|
(782)
|
|
1,126
|
|
-
|
|
344
|
|
|
|
|
|
|
|
|
Attributable
to:
|
|
|
|
|
|
|
|
Equity holders
of the parent
|
(577)
|
|
777
|
|
-
|
|
200
|
Non-controlling
interest
|
(205)
|
|
349
|
|
-
|
|
144
|
IRSA Inversiones y
Representaciones Sociedad Anónima
|
09.30.2016
(originally
issued)
|
|
09.30.2016
(adjustment)
|
|
09.30.2016
(other reclassifications) g)
|
|
09.30.2016
(recast)
|
(Loss) /
Profit for the period
|
(782)
|
|
1,126
|
|
-
|
|
344
|
Other
comprehensive (loss) / income
|
|
|
|
|
|
|
|
Items
that may be reclassified subsequently to profit or
loss:
|
|
|
|
|
|
|
|
Cumulative translation
adjustment
|
464
|
|
45
|
f)
|
-
|
|
509
|
Change in the fair value of hedging
instruments net of income tax
|
56
|
|
-
|
|
-
|
|
56
|
Items
that may not be reclassified subsequently to profit or loss, net of
income tax
|
|
|
|
|
|
|
|
Actuarial loss from defined
contribution plans
|
(22)
|
|
-
|
|
-
|
|
(22)
|
Other loss generated by
associates
|
(3)
|
|
-
|
|
-
|
|
(3)
|
Other
comprehensive income for the period from continuing
operations
|
495
|
|
45
|
|
-
|
|
540
|
Other comprehensive income for the
period from discontinued operations
|
-
|
|
-
|
|
-
|
|
-
|
Total
comprehensive (loss) / income for the period
|
(287)
|
|
1,171
|
|
-
|
|
884
|
Attributable
to:
|
|
|
|
|
|
|
|
Equity holders
of the parent
|
(365)
|
|
793
|
|
-
|
|
428
|
Non-controlling
interest
|
78
|
|
378
|
|
-
|
|
456
|
a)
Corresponds to the elimination of depreciation
expense from investment property, and the adjustment, if
applicable, to the depreciation of property, plant and equipment
to
adjust the value of
transfers from investment property to that item.
b)
It relates to the elimination of the gain from
disposal of investment property, as such property is accounted for
at its fair value on the date of sale, which generally coincides
with the transaction price (see point d)).
c)
It represents the net change in fair value of
investment property.
d)
It relates to changes in share of profit /
(loss) in associates and joint ventures after applying the change
to equity method valuation implemented by the Group.
e)
It reflects the tax effect on the items
indicated above, as applicable.
f)
It pertains to exchange differences related to
the change in the accounting policy implemented by the Group in
subsidiaries, associates and joint ventures with functional
currency other than the peso.
g)
See Notes 2.26 and 32 to the Consolidated
Financial Statements as of June 30, 2017.
2.2.
Significant accounting
policies
The accounting policies applied in
the presentation of these Financial Statements are consistent with
those applied in the preparation of the Consolidated Financial
Statements as of June 30, 2017, as described in Note 2 to those
Financial Statements
The preparation of Financial
Statements at a certain date requires the Management to make
estimations and evaluations affecting the amount of assets and
liabilities recorded and contingent assets and liabilities
disclosed at such date, as well as income and expenses recorded
during the period. Actual results might differ from the estimates
and evaluations made at the date of preparation of these financial
statements. In the preparation of these financial statements, the
significant judgments made by Management in applying the
Group’s accounting policies and the main sources of
uncertainty were the same applied by the Group in the preparation
of the Consolidated Financial Statements as of June 30, 2017
described in Note 3 to those Financial Statements.
2.4.
Comparability of
information
Balance items as of June 30, 2017
and September 30, 2016 shown in these Unaudited Condensed Interim
Consolidated Financial Statements for comparative purposes arise
from financial statements then ended. As explained in Note 2.1.b.
certain figures of the originally issued financial statements as of
September 30, 2016 have been adjusted to reflect the change of
accounting policy related to investment property as determined by
the Board of Directors during the fiscal year ended June 30,
2017.
3.
Seasonal effects on
operations
Operations Center
in Argentina
The operations of the Group’s
shopping malls are subject to seasonal effects, which affect the
level of sales recorded by lessees. During summer time in Argentina
(January and February), the lessees of shopping malls experience
the lowest sales levels in comparison with the winter holidays
(July) and Christmas and year-end holidays celebrated in December,
when they tend to record peaks of sales. Apparel stores generally
change their collections during the spring and the fall, which
impacts positively on shopping malls sales. Sale discounts at the
end of each season also affect the business. As a consequence, for
shopping mall operations, a higher level of business activity is
expected in the period ranging between July and December, compared
to the period between January and June.
IRSA Inversiones y
Representaciones Sociedad Anónima
Operations Center
in Israel
The operations of the Shufersal
supermarket chain are subject to fluctuations of quarterly sales
and income due to the increase in activity during religious
holidays in different quarters throughout the year. For instance,
in Pesaj (Passover) sometime between March and April, and Rosh
Hashaná (Jewish New Year), sometime between September and
October each year.
The results of operations of Cellcom
and IDBD Tourism are also usually affected by seasonality in summer
months in Israel and by the Jewish New Year, given a higher
consumption due to internal and external tourism.
4.
Acquisitions and
disposals
Significant acquisitions and
disposals for the three-month period ended September 30, 2017 are
detailed below. Significant acquisitions and disposals for the
fiscal year ended June 30, 2017, are detailed in Note 4 to the
Consolidated Financial Statements as of June 30, 2017.
Ispro
In August 2017, PBC’s Board of
Directors, decided to start a process to examine the potential sale
of its interest in Ispro. In this respect, it has received several
offers.
Agreement
for New Pharm acquisition
As mentioned in Note 4.G to the
Consolidated Financial Statements as of June 30, 2017, Shufersal
entered into an agreement (the "agreement") for the purchase of the
shares of New Pharm Drugstores Ltd. ("New Pharm"), representative
of 100% of that Company’s share capital. On September 6,
2017, the Antitrust Commission approved the merger between
Shufersal and New Pham subject to certain conditions. On September
28, 2017, the parties signed an Addendum to such agreement whereby
they agreed to sell 9 New Pharm stores to a third party and one
Shufersal store to another party. The proceeds from the sale of New
Pharm stores will be collected by this company before the merger,
thus changing the transaction price, albeit not significantly. The
deadline for the execution of the sale agreement has been set on
November 30, 2017 and the execution date on December 31,
2017.
Tender
offer of DIC
As mentioned in
Note 7 to the Consolidated Financial Statements as of June 30,
2017, after June 30, 2017, Dolphin Netherlands B.V. made a
non-binding tender offer for the acquisition of all DIC shares held
by IDBD.
For purposes of
the transaction, a committee of independent directors has been set
up to assess the tender offer and negotiate the terms and
conditions. In response to an inquiry, the Audit Committee has
issued an opinion without reservations as to the transaction in
accordance with the terms of section 72 et al. of the Capital
Markets Law N° 26,831.
In September 2017, IDBD informed
that the Company and Dolphin signed a letter of intent. The
transaction’s completion is dependent upon the execution of
the definitive transaction documents (the “Definitive
Documents”) by the parties on or before November 16, 2017, as
well as upon approval of the transaction by the parties’
respective Boards of Directors and compliance with additional
guarantees until December 10, 2017 (the “Transaction Closing
Date”). The main items of the letter of intent are the
following:
IRSA Inversiones y
Representaciones Sociedad Anónima
●
The buyer will acquire all of DIC shares held by
IDBD at a price of NIS 16.6 per share (equal to approximately Ps.
80 per share as of the date of these Financial
Statements).
●
The buyer will issue a promissory note, maturing
five years from the effective transaction date which shall accrue
interest at an annual rate of 5.5%. Until the promissory note is
fully paid, any dividend payment made by DIC shall be paid through
an Israeli bank and will be pledged in favor of the
seller.
●
All DIC shares that are currently securing debt,
shall continue to be collateral for that debt, and those shares
that are currently unencumbered will be pledged to secure payment
of the promissory note.
IDBD is
currently analyzing the next steps to continue controlling its
subsidiaries in 2019.
Tender
offer for Clal
In July 2017, IDBD received a
non-binding offer from an international group for the potential
acquisition of its entire interest in Clal. For consideration that
will be based on the equity value of Clal, in accordance with Clal
Financial Statement at the time of specifying the transaction and
is subject to the performance of a due diligence and the execution
of an agreement, as well as getting the approvals required by law.
IDBD is analyzing the offer. On June 30, 2017, this value amounted
to NIS 4,880 (equivalent to approximately Ps. 23,278 as of the date
of these Financial Statements). There is no certainty that the
offer will go forward under the terms offered, or that the
transaction will be completed.
5.
Financial risk management and
fair value estimates
These Financial Statements do not
include all the information and disclosures on financial risk
management; therefore, they should be read along with Note 5 to the
Consolidated Financial Statements as of June 30, 2017.
There have been no changes in risk
management or risk management policies applied by the Group since
year-end.
Since June 30,
2017 as of the date of this Financial Statements, there have been
no significant changes in business or economic circumstances
affecting the fair value of the Group's assets or liabilities
(either measured at fair value or amortized cost). Furthermore,
there have been no transfers between the different hierarchies used
to assess the fair value of the Group’s financial
instruments.
As explained in
Note 6 to the Consolidated Financial Statements as of June 30,
2017, the Group reported its financial performance separately in
two centers of operations. There have been no changes in the
business segments or the financial reporting criteria thereof.
Below is a summary of the lines of business of the group for the
periods ended September 30, 2017 and 2016:
|
September
30, 2017
|
|
September
30, 2016 (recast)
|
|
Operations
Center in Argentina
|
|
Operations
Center in Israel
|
|
Total
|
|
Operations
Center in Argentina
|
|
Operations
Center in Israel
|
|
Total
|
Revenues
|
1,220
|
|
18,594
|
|
19,814
|
|
957
|
|
16,499
|
|
17,456
|
Costs
|
(249)
|
|
(13,064)
|
|
(13,313)
|
|
(203)
|
|
(11,780)
|
|
(11,983)
|
Gross
Profit
|
971
|
|
5,530
|
|
6,501
|
|
754
|
|
4,719
|
|
5,473
|
Net gain from
fair value adjustment of investment properties
|
2,521
|
|
922
|
|
3,443
|
|
1,070
|
|
336
|
|
1,406
|
General and
administrative expenses
|
(197)
|
|
(813)
|
|
(1,010)
|
|
(152)
|
|
(702)
|
|
(854)
|
Selling
expenses
|
(92)
|
|
(3,470)
|
|
(3,562)
|
|
(87)
|
|
(3,083)
|
|
(3,170)
|
Other operating
results, net
|
(27)
|
|
36
|
|
9
|
|
(12)
|
|
(56)
|
|
(68)
|
Profit
from operations
|
3,176
|
|
2,205
|
|
5,381
|
|
1,573
|
|
1,214
|
|
2,787
|
Share of profit
/ (loss) of joint ventures and associates
|
487
|
|
(101)
|
|
386
|
|
48
|
|
(47)
|
|
1
|
Segment
profit
|
3,663
|
|
2,104
|
|
5,767
|
|
1,621
|
|
1,167
|
|
2,788
|
Reportable
assets
|
48,213
|
|
180,774
|
|
228,987
|
|
40,567
|
|
149,755
|
|
190,322
|
Reportable
liabilities
|
-
|
|
(159,846)
|
|
(159,846)
|
|
-
|
|
(134,526)
|
|
(134,526)
|
Net
reportable assets
|
48,213
|
|
20,928
|
|
69,141
|
|
40,567
|
|
15,229
|
|
55,796
|
IRSA Inversiones
y Representaciones Sociedad Anónima
Below is a summarized analysis of
the lines of business of Group’s operations center in
Argentina for the periods ended September 30, 2017 and
2016:
|
September
30, 2017
|
|
Operations
Center in Argentina
|
|
Shopping
Malls
|
|
Offices
and others
|
|
Sales
and developments
|
|
Hotels
|
|
International
|
|
Financial
operations, Corporate and others
|
|
Total
|
Revenues
|
850
|
|
122
|
|
34
|
|
214
|
|
-
|
|
-
|
|
1,220
|
Costs
|
(85)
|
|
(7)
|
|
(10)
|
|
(147)
|
|
-
|
|
-
|
|
(249)
|
Gross
profit
|
765
|
|
115
|
|
24
|
|
67
|
|
-
|
|
-
|
|
971
|
Net gain from
fair value adjustment of investment properties
|
2,044
|
|
280
|
|
197
|
|
-
|
|
-
|
|
-
|
|
2,521
|
General and
administrative expenses
|
(66)
|
|
(9)
|
|
(19)
|
|
(39)
|
|
(21)
|
|
(43)
|
|
(197)
|
Selling
expenses
|
(49)
|
|
(8)
|
|
(3)
|
|
(28)
|
|
-
|
|
(4)
|
|
(92)
|
Other operating
results, net
|
(9)
|
|
6
|
|
(18)
|
|
(2)
|
|
(3)
|
|
(1)
|
|
(27)
|
Profit /
(Loss) from operations
|
2,685
|
|
384
|
|
181
|
|
(2)
|
|
(24)
|
|
(48)
|
|
3,176
|
Share of profit
of joint ventures and associates
|
-
|
|
12
|
|
2
|
|
-
|
|
113
|
|
360
|
|
487
|
Segment
profit / (loss)
|
2,685
|
|
396
|
|
183
|
|
(2)
|
|
89
|
|
312
|
|
3,663
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment
properties
|
30,912
|
|
8,031
|
|
4,938
|
|
-
|
|
-
|
|
-
|
|
43,881
|
Property, plant
and equipment
|
57
|
|
40
|
|
-
|
|
159
|
|
54
|
|
-
|
|
310
|
Trading
properties
|
-
|
|
-
|
|
614
|
|
-
|
|
-
|
|
-
|
|
614
|
Goodwill
|
1
|
|
36
|
|
-
|
|
-
|
|
-
|
|
-
|
|
37
|
Right to
receive future units under barter agreements
|
-
|
|
-
|
|
44
|
|
-
|
|
-
|
|
-
|
|
44
|
Inventories
|
26
|
|
1
|
|
-
|
|
11
|
|
-
|
|
-
|
|
38
|
Investments in
joint ventures and associates
|
-
|
|
125
|
|
141
|
|
-
|
|
705
|
|
2,318
|
|
3,289
|
Operating
assets
|
30,996
|
|
8,233
|
|
5,737
|
|
170
|
|
759
|
|
2,318
|
|
48,213
|
|
September
30, 2016 (recast)
|
|
Operations
Center in Argentina
|
|
Shopping
Malls
|
|
Offices
and others
|
|
Sales
and developments
|
|
Hotels
|
|
International
|
|
Financial
operations, Corporate and others
|
|
Total
|
Revenues
|
682
|
|
101
|
|
1
|
|
173
|
|
-
|
|
-
|
|
957
|
Costs
|
(74)
|
|
(8)
|
|
(5)
|
|
(116)
|
|
-
|
|
-
|
|
(203)
|
Gross
profit / (Loss)
|
608
|
|
93
|
|
(4)
|
|
57
|
|
-
|
|
-
|
|
754
|
Net gain from
fair value adjustment of investment properties
|
886
|
|
147
|
|
37
|
|
-
|
|
-
|
|
-
|
|
1,070
|
General and
administrative expenses
|
(49)
|
|
(6)
|
|
(11)
|
|
(31)
|
|
(22)
|
|
(33)
|
|
(152)
|
Selling
expenses
|
(42)
|
|
(15)
|
|
(3)
|
|
(22)
|
|
-
|
|
(5)
|
|
(87)
|
Other operating
results, net
|
(9)
|
|
5
|
|
(3)
|
|
-
|
|
(4)
|
|
(1)
|
|
(12)
|
Profit /
(Loss) from operations
|
1,394
|
|
224
|
|
16
|
|
4
|
|
(26)
|
|
(39)
|
|
1,573
|
Share of profit
/ (loss) of joint ventures and associates
|
-
|
|
12
|
|
7
|
|
-
|
|
(24)
|
|
53
|
|
48
|
Segment
profit / (loss)
|
1,394
|
|
236
|
|
23
|
|
4
|
|
(50)
|
|
14
|
|
1,621
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment
properties
|
27,479
|
|
5,950
|
|
4,062
|
|
-
|
|
-
|
|
-
|
|
37,491
|
Property, plant
and equipment
|
50
|
|
33
|
|
2
|
|
153
|
|
2
|
|
-
|
|
240
|
Trading
properties
|
-
|
|
-
|
|
616
|
|
-
|
|
-
|
|
-
|
|
616
|
Goodwill
|
7
|
|
86
|
|
-
|
|
-
|
|
-
|
|
-
|
|
93
|
Right to
receive future units under barter agreements
|
-
|
|
-
|
|
90
|
|
-
|
|
-
|
|
-
|
|
90
|
Inventories
|
21
|
|
-
|
|
1
|
|
9
|
|
-
|
|
-
|
|
31
|
Investments in
joint ventures and associates
|
-
|
|
53
|
|
69
|
|
-
|
|
116
|
|
1,768
|
|
2,006
|
Operating
assets
|
27,557
|
|
6,122
|
|
4,840
|
|
162
|
|
118
|
|
1,768
|
|
40,567
|
IRSA Inversiones
y Representaciones Sociedad Anónima
Below is a summarized analysis of
the lines of business of Group’s operations center in Israel
for the periods ended September 30, 2017 and 2016:
|
September
30, 2017
|
|
Operations
Center in Israel
|
|
Real
Estate
|
|
Supermarkets
|
|
Telecommunications
|
|
Insurance
|
|
Others
|
|
Total
|
|
Revenues
|
997
|
|
13,182
|
|
4,226
|
|
-
|
|
189
|
|
18,594
|
|
Costs
|
(250)
|
|
(9,813)
|
|
(2,991)
|
|
-
|
|
(10)
|
|
(13,064)
|
|
Gross
profit
|
747
|
|
3,369
|
|
1,235
|
|
-
|
|
179
|
|
5,530
|
|
Net gain from
fair value adjustment of investment properties
|
922
|
|
-
|
|
-
|
|
-
|
|
-
|
|
922
|
|
General and
administrative expenses
|
(83)
|
|
(202)
|
|
(382)
|
|
-
|
|
(146)
|
|
(813)
|
|
Selling
expenses
|
(26)
|
|
(2,600)
|
|
(826)
|
|
-
|
|
(18)
|
|
(3,470)
|
|
Other operating
results, net
|
22
|
|
(78)
|
|
145
|
|
-
|
|
(53)
|
|
36
|
|
Profit/
(Loss) from operations
|
1,582
|
|
489
|
|
172
|
|
-
|
|
(38)
|
|
2,205
|
|
Share of (loss)
/ profit of joint ventures and associates
|
(210)
|
|
4
|
|
-
|
|
-
|
|
105
|
|
(101)
|
|
Segment
profit
|
1,372
|
|
493
|
|
172
|
|
-
|
|
67
|
|
2,104
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
assets
|
83,752
|
|
37,486
|
|
32,601
|
|
8,652
|
|
18,283
|
|
180,774
|
|
Operating
liabilities
|
(66,424)
|
|
(26,196)
|
|
(25,996)
|
|
-
|
|
(41,230)
|
|
(159,846)
|
|
Operating
assets / (liabilities), net
|
17,328
|
|
11,290
|
|
6,605
|
|
8,652
|
|
(22,947)
|
|
20,928
|
|
|
September
30, 2016 (recast)
|
|
Operations
Center in Israel
|
|
Real
Estate
|
|
Supermarkets
|
|
Telecommunications
|
|
Insurance
|
|
Others
|
|
Total
|
Revenues
|
1,049
|
|
11,467
|
|
3,841
|
|
-
|
|
142
|
|
16,499
|
Costs
|
(411)
|
|
(8,716)
|
|
(2,565)
|
|
-
|
|
(88)
|
|
(11,780)
|
Gross
profit
|
638
|
|
2,751
|
|
1,276
|
|
-
|
|
54
|
|
4,719
|
Net gain from
fair value adjustment of investment properties
|
336
|
|
-
|
|
-
|
|
-
|
|
-
|
|
336
|
General and
administrative expenses
|
(63)
|
|
(149)
|
|
(355)
|
|
-
|
|
(135)
|
|
(702)
|
Selling
expenses
|
(19)
|
|
(2,202)
|
|
(851)
|
|
-
|
|
(11)
|
|
(3,083)
|
Other operating
results, net
|
-
|
|
(15)
|
|
(7)
|
|
-
|
|
(34)
|
|
(56)
|
Profit /
(Loss) from operations
|
892
|
|
385
|
|
63
|
|
-
|
|
(126)
|
|
1,214
|
Share of (loss)
/ profit of joint ventures and associates
|
(101)
|
|
-
|
|
-
|
|
-
|
|
54
|
|
(47)
|
Segment
profit / (loss)
|
791
|
|
385
|
|
63
|
|
-
|
|
(72)
|
|
1,167
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
assets
|
59,901
|
|
29,121
|
|
27,455
|
|
4,793
|
|
28,485
|
|
149,755
|
Operating
liabilities
|
(48,387)
|
|
(23,034)
|
|
(21,780)
|
|
-
|
|
(41,325)
|
|
(134,526)
|
Operating
assets / (liabilities), net
|
11,514
|
|
6,087
|
|
5,675
|
|
4,793
|
|
(12,840)
|
|
15,229
|
The following
tables present a reconciliation between the total profit / (loss)
from operations as per segment information and the profit / (loss)
from operations as per the Statements of Income:
|
September
30, 2017
|
|
Total as
per segment information
|
|
Joint
ventures
|
|
Expenses
and collective promotion funds
|
|
Elimination
of inter-segment transactions
|
|
Total as
per statement of income
|
|
Revenues
|
19,814
|
|
(11)
|
|
413
|
|
(3)
|
|
20,213
|
|
Costs
|
(13,313)
|
|
4
|
|
(419)
|
|
1
|
|
(13,727)
|
|
Gross
profit
|
6,501
|
|
(7)
|
|
(6)
|
|
(2)
|
|
6,486
|
|
Net gain from
fair value adjustments of investment properties
|
3,443
|
|
(39)
|
|
-
|
|
-
|
|
3,404
|
|
General and
administrative expenses
|
(1,010)
|
|
12
|
|
-
|
|
3
|
|
(995)
|
|
Selling
expenses
|
(3,562)
|
|
1
|
|
-
|
|
-
|
|
(3,561)
|
|
Other operating
results, net
|
9
|
|
16
|
|
-
|
|
(1)
|
|
24
|
|
Profit
from operations
|
5,381
|
|
(17)
|
|
(6)
|
|
-
|
|
5,358
|
|
Share of profit
of joint ventures and associates
|
386
|
|
12
|
|
-
|
|
-
|
|
398
|
|
Profit
before financial results and income tax
|
5,767
|
|
(5)
|
|
(6)
|
|
-
|
|
5,756
|
|
IRSA Inversiones
y Representaciones Sociedad Anónima
|
September
30, 2016 (recast)
|
|
Total as
per segment information
|
|
Joint
ventures
|
|
Expenses
and collective promotion funds
|
|
Elimination
of inter-segment transactions
|
|
Total as
per statement of income
|
Revenues
|
17,456
|
|
(9)
|
|
341
|
|
(1)
|
|
17,787
|
Costs
|
(11,983)
|
|
5
|
|
(348)
|
|
-
|
|
(12,326)
|
Gross
profit
|
5,473
|
|
(4)
|
|
(7)
|
|
(1)
|
|
5,461
|
Net gain from
fair value adjustment of investment properties
|
1,406
|
|
(10)
|
|
-
|
|
-
|
|
1,396
|
General and
administrative expenses
|
(854)
|
|
1
|
|
-
|
|
1
|
|
(852)
|
Selling
expenses
|
(3,170)
|
|
1
|
|
-
|
|
-
|
|
(3,169)
|
Other operating
results, net
|
(68)
|
|
(1)
|
|
-
|
|
-
|
|
(69)
|
Profit
from operations
|
2,787
|
|
(13)
|
|
(7)
|
|
-
|
|
2,767
|
Share of profit
of joint ventures and associates
|
1
|
|
8
|
|
-
|
|
-
|
|
9
|
Profit
before financial results and income tax
|
2,788
|
|
(5)
|
|
(7)
|
|
-
|
|
2,776
|
The following
tables present a reconciliation between total segment assets as per
segment information of Operations Centers in Argentina and Israel
and total assets as per the Statement of Financial
Position.
|
September
30, 2017
|
|
September
30, 2016 (recast)
|
|
Operations
Center in Argentina
|
Operations
Center in Israel
|
Total
|
|
Operations
Center in Argentina
|
Operations
Center in Israel
|
Total
|
Total
assets based on segment information
|
48,213
|
180,774
|
228,987
|
|
40,567
|
149,755
|
190,322
|
Proportionate
share in assets per segment of joint ventures
|
(954)
|
-
|
(954)
|
|
(773)
|
-
|
(773)
|
Investment in
joint ventures (1)
|
689
|
-
|
689
|
|
613
|
-
|
613
|
Other
non-reportable assets (2)
|
10,649
|
-
|
10,649
|
|
7,477
|
-
|
7,477
|
Total
assets as per Statement of Financial Position
|
58,597
|
180,774
|
239,371
|
|
47,884
|
149,755
|
197,639
|
(1)
Represents the equity value of joint ventures
that were proportionately consolidated for information by segment
purposes.
(2)
Includes deferred income tax asset, income tax
and MPIT credits, trade and other receivables, investment in
financial assets, cash and cash equivalents and intangible assets
except for right to receive future units under barter agreements,
net of investments in associates with negative equity which are
included in provisions in the amount of Ps. 21, as of September 30,
2016.
IRSA Inversiones
y Representaciones Sociedad Anónima
7.
Information about the main
subsidiaries
The Group conducts its business
through several operating and holding subsidiaries. The Group
considers that the subsidiaries below are the ones with significant
non-controlling interests to the Group.
|
As of
September 30, 2017
|
|
Period
ended September 30, 2017
|
|
Direct interest of
non-controlling interest %
|
|
Current
Assets
|
|
Non-current
Assets
|
|
Current
Liabilities
|
|
Non-current
Liabilities
|
|
Net
assets
|
|
Book
value of non-controlling interests
|
|
Revenues
|
|
Net
income / (loss)
|
|
Total
comprehensive income / (loss)
|
|
Total
comprehensive profit / (loss) attributable to non-controlling
interest
|
|
Cash of
operating activities
|
|
Cash of
investing activities
|
|
Cash of
financing activities
|
|
Net
Increase (decrease) in cash and cash equivalents
|
|
Dividends
distribution to non-controlling shareholders
|
Elron
|
49.68%
|
|
1,450
|
|
1,111
|
|
143
|
|
14
|
|
2,404
|
|
1,793
|
|
-
|
|
(145)
|
|
(61)
|
|
(132)
|
|
(79)
|
|
105
|
|
22
|
|
48
|
|
-
|
PBC
|
35.56%
|
|
18,273
|
|
62,451
|
|
10,507
|
|
54,395
|
|
15,822
|
|
12,354
|
|
997
|
|
(171)
|
|
(356)
|
|
426
|
|
571
|
|
(2,565)
|
|
2,073
|
|
79
|
|
-
|
Cellcom
|
57.74%
|
|
12,444
|
|
17,925
|
|
8,595
|
|
16,446
|
|
5,328
|
|
3,720
|
|
4,226
|
|
53
|
|
-
|
|
35
|
|
1,120
|
|
(1,103)
|
|
844
|
|
861
|
|
-
|
Shufersal
|
45.81%
|
|
11,634
|
|
23,549
|
|
13,442
|
|
13,055
|
|
8,686
|
|
5,366
|
|
13,182
|
|
312
|
|
(22)
|
|
189
|
|
307
|
|
(360)
|
|
809
|
|
756
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of
June 30, 2017
|
|
Period
ended September 30, 2016 (recast)
|
|
Direct interest of
non-controlling interest %
|
|
Current
Assets
|
|
Non-current
Assets
|
|
Current
Liabilities
|
|
Non-current
Liabilities
|
|
Net
assets
|
|
Book
value of non-controlling interests
|
|
Revenues
|
|
Net
income / (loss)
|
|
Total
comprehensive income / (loss)
|
|
Total
comprehensive profit / (loss) attributable to non-controlling
interest
|
|
Cash of
operating activities
|
|
Cash of
investing activities
|
|
Cash of
financing activities
|
|
Net
Increase (decrease) in cash and cash equivalents
|
|
Dividends
distribution to non-controlling shareholders
|
Elron
|
49.68%
|
|
1,669
|
|
1,183
|
|
162
|
|
9
|
|
2,681
|
|
1,975
|
|
-
|
|
(60)
|
|
45
|
|
(45)
|
|
(52)
|
|
(109)
|
|
-
|
|
(161)
|
|
-
|
PBC
|
35.56%
|
|
15,391
|
|
64,345
|
|
10,197
|
|
53,713
|
|
15,826
|
|
11,161
|
|
1,049
|
|
97
|
|
142
|
|
209
|
|
485
|
|
105
|
|
(56)
|
|
534
|
|
-
|
Cellcom
|
57.74%
|
|
12,163
|
|
18,273
|
|
8,171
|
|
16,928
|
|
5,337
|
|
3,706
|
|
3,841
|
|
(19)
|
|
-
|
|
(11)
|
|
762
|
|
(385)
|
|
747
|
|
1,124
|
|
-
|
Shufersal
|
39.33%
|
|
14,124
|
|
23,482
|
|
16,256
|
|
12,984
|
|
8,366
|
|
3,840
|
|
11,467
|
|
220
|
|
(19)
|
|
131
|
|
937
|
|
(384)
|
|
(400)
|
|
153
|
|
-
|
IRSA Inversiones
y Representaciones Sociedad Anónima
8.
Investments in associates and
joint ventures
Changes in the Group’s
investments in associates for the three-month period ended
September 30, 2017 and for the year ended June 30, 2017 were as
follows:
|
September
30, 2017
|
|
June 30,
2017
|
Beginning
of the period / year
|
4,575
|
|
14,429
|
Increase in
equity interest in associates
|
35
|
|
1,102
|
Issuance of
capital and contributions
|
44
|
|
46
|
Capital
reduction
|
(97)
|
|
(32)
|
Share of
profit
|
427
|
|
85
|
Cumulative
translation adjustment
|
(32)
|
|
(210)
|
Cash dividends
(i)
|
(11)
|
|
(185)
|
Reclassification to held
for sale
|
(44)
|
|
(10,709)
|
Others
|
-
|
|
49
|
End of
the period / year (ii)
|
4,897
|
|
4,575
|
(i) During the period ended
September 30, 2017 the balance corresponds to Condor. During the
fiscal year ended June 30, 2017 the balance corresponds: Ps. 101 to
Emco, Ps. 36 to Aviareps AG, Ps. 22 to Condor, Ps. 19 to Manibil
and Ps. 7 to Millenium.
(ii) As of June 30, 2017
includes Ps. (72) reflecting interests in companies with negative
equity, which were disclosed in “Provisions” (see Note
18).
Changes in the Group’s
investments in joint ventures for the three-month period ended
September 30, 2017 and for the year ended June 30, 2017 were as
follows:
|
September
30, 2017
|
|
June 30,
2017
|
Beginning
of the period / year
|
3,238
|
|
2,406
|
Decrease for
control obtainment
|
-
|
|
(59)
|
Incorporated by
business combination
|
-
|
|
107
|
Capital
contributions
|
12
|
|
114
|
Share of (loss)
/ profit
|
(29)
|
|
293
|
Cumulative
translation adjustment
|
(4)
|
|
442
|
Cash dividends
(i)
|
-
|
|
(65)
|
Liquidation
distribution (ii)
|
(65)
|
|
-
|
End of
the period / year
|
3,152
|
|
3,238
|
(i)
During the fiscal year ended June 30, 2017 the
balance corresponds: Ps. 36 to Manaman, Ps. 12 to NPSF, Ps. 9 to
LRSA, Ps. 7 to Cyrsa S.A. and Ps. 1 to Baicom.
(ii) It corresponds to the
distribution following the partial liquidation of
Baicom.
IRSA Inversiones
y Representaciones Sociedad Anónima
The table below lists additional
information about the Group’s investments in
associates:
Name of
the entity
|
Place of
business / Country of incorporation
|
Main
activity
|
Common
shares 1 vote
|
Value of
Group's interest in equity
|
|
Group's
interest in comprehensive income / (loss)
|
|
%
ownership interest
|
|
Latest
financial statements issued
|
September
30, 2017
|
June 30,
2017
|
|
September
30, 2017
|
September
30, 2016 (recast)
|
|
September
30, 2017
|
June 30,
2017
|
|
Share
capital (nominal value)
|
Profit /
(loss) for the period
|
Shareholders’
equity
|
New Lipstick
(1)
|
U.S.A.
|
Real
estate
|
N/A
|
39
|
(72)
|
|
111
|
(46)
|
|
49.9%
|
49.9%
|
|
N/A
|
(*)
(24)
|
(*)
(159)
|
BHSA
|
Argentina
|
Financial
|
448,689,072
|
2,064
|
1,693
|
|
371
|
39
|
|
29.9%
|
29.9%
|
|
(***)
1,500
|
(***)
625
|
(***)
6,681
|
Condor
|
U.S.A.
|
Hotel
|
3,337,613
|
657
|
634
|
|
30
|
25
|
|
28.6%
|
28.7%
|
|
N/A
|
(*)
5
|
(*)
100
|
PBEL
|
India
|
Real
estate
|
450,000
|
663
|
768
|
|
(60)
|
(42)
|
|
45.4%
|
45.4%
|
|
(**)
1
|
(**)
(40)
|
(**)
(592)
|
Other
associates
|
|
|
|
1,474
|
1,552
|
|
(57)
|
265
|
|
-
|
-
|
|
N/A
|
N/A
|
N/A
|
|
|
|
|
4,897
|
4,575
|
|
395
|
241
|
|
|
|
|
|
|
(1)
Metropolitan, a subsidiary of New Lipstick, has
renegotiated its non-recourse debt with IRSA, which amounted to US$
113.1, and obtained a debt reduction of US$ 20 by the lending bank,
an extension to April 30, 2020 and an interest rate reduction from
LIBOR + 4 b.p. to 2 b.p. upon payment of US$ 40 in cash (US$ 20 in
September 2017 and US$ 20 in October 2017), of which IRSA has
contributed with US$ 20. Following the renegotiation,
Metropolitan’s debt amounts to US$ 53.1. Additionally,
Metropolitan has agreed to exercise on or before February 1, 2019
the purchase option on part of the land where the property is built
and, to deposit the sum of money corresponding to 1% of the
purchase price. Furthermore, Metropolitan has agreed to cause IRSA
and other shareholders to furnish the bank, on or before February
1, 2020, with a payment guarantee with financial ratios acceptable
to the Bank for the outstanding balance of the purchase price, or a
letter of credit in relation to the loan balance then
outstanding.
(*)
Amounts in millions of US Dollar under USGAAP.
Condor’s year-end falls on December 31, so the Group
estimates their interest with a three-month lag, including material
adjustments, if any.
(**)
Amounts in millions of NIS.
(***)
Information as of June 30,
2017 according to BCRA's standards.
For the purpose of the valuation of the investment in the Company,
preliminary figures as of September 30, 2017 have been considered
with the necessary IFRS adjustments.
The table below lists additional
information about the Group’s investments in joint
ventures:
Name of
the entity
|
Place of
business / Country of incorporation
|
Main
activity
|
Common
shares 1 vote
|
Value of
Group's interest in equity
|
|
Group's
interest in comprehensive income / (loss)
|
|
%
ownership interest
|
|
Latest
financial statements issued
|
September
30, 2017
|
June 30,
2017
|
|
September
30, 2017
|
September
30, 2016 (recast)
|
|
September
30, 2017
|
June 30,
2017
|
|
Share
capital (nominal value)
|
Profit /
(loss) for the period
|
Shareholders’
equity
|
Quality
|
Argentina
|
Real
estate
|
81,814,342
|
507
|
482
|
|
17
|
4
|
|
50.00%
|
50.00%
|
|
164
|
36
|
1,007
|
La Rural
SA
|
Argentina
|
Events and
others
|
714,498
|
124
|
113
|
|
11
|
11
|
|
50.00%
|
50.00%
|
|
1
|
32
|
59
|
Mehadrin
|
Israel
|
-
|
1,509,889
|
1,245
|
1,312
|
|
(67)
|
(38)
|
|
45.41%
|
45.41%
|
|
(*)
3
|
(*)
(9
)
|
(*)
527
|
Other joint
ventures
|
|
|
-
|
1,276
|
1,331
|
|
6
|
13
|
|
-
|
-
|
|
N/A
|
N/A
|
N/A
|
|
|
|
|
3,152
|
3,238
|
|
(33)
|
(10
)
|
|
|
|
|
|
|
|
(*)
Amounts in millions of NIS.
IRSA Inversiones
y Representaciones Sociedad Anónima
Changes in the Group’s
investment properties for the three-month period ended September
30, 2017 and for the year ended June 30, 2017 were as
follows:
|
Period
ended
September 30,
2017
|
|
Year
ended
June 30,
2017
|
|
Rental
properties
|
|
Undeveloped
parcels of land
|
|
Properties
under development
|
|
Total
|
|
Total
|
Fair
value at the beginning of the period / year
|
89,301
|
|
7,647
|
|
3,005
|
|
99,953
|
|
82,703
|
Additions
|
415
|
|
4
|
|
277
|
|
696
|
|
2,651
|
Financial cost
charged
|
-
|
|
-
|
|
-
|
|
-
|
|
3
|
Capitalized
leasing costs
|
7
|
|
-
|
|
-
|
|
7
|
|
24
|
Amortization of
capitalized leasing costs (i)
|
(1)
|
|
-
|
|
-
|
|
(1)
|
|
(2)
|
Transfers
|
(4)
|
|
4
|
|
-
|
|
-
|
|
-
|
Transfers from
property, plant and equipment
|
-
|
|
-
|
|
-
|
|
-
|
|
156
|
Transfers to
trading properties
|
(351)
|
|
-
|
|
-
|
|
(351)
|
|
(14)
|
Transfers to
assets held for sale
|
-
|
|
-
|
|
-
|
|
-
|
|
(71)
|
Reclassifications previous
periods
|
-
|
|
-
|
|
-
|
|
-
|
|
(224)
|
Disposals due
to sales
|
(26)
|
|
-
|
|
-
|
|
(26)
|
|
(220)
|
Cumulative
translation adjustment
|
(596)
|
|
(47)
|
|
(61)
|
|
(704)
|
|
10,494
|
Fair value
adjustment
|
3,902
|
|
(36)
|
|
(462)
|
|
3,404
|
|
4,453
|
Fair
value at the end of the period / year
|
92,647
|
|
7,572
|
|
2,759
|
|
102,978
|
|
99,953
|
(i)
Amortization charges of capitalized leasing
costs were included in “Costs” in the Statements of
Income (Note 21).
The following amounts have been
recognized in the Statements of Income:
|
September
30,
2017
|
|
September 30,
2016
(recast)
|
Rental and
services income
|
2,454
|
|
1,946
|
Direct
operating expenses
|
(654)
|
|
(615)
|
Development
expenditures
|
(35)
|
|
(4)
|
Net realized
gain from fair value adjustment of investment
properties
|
24
|
|
19
|
Net unrealized
gain from fair value adjustment of investment
properties
|
3,380
|
|
1,377
|
Valuation
techniques are described in Note 10 to the Consolidated Financial
Statements as of June 30, 2017. There were no changes to the
valuation techniques.
10.
Property,
plant and equipment
Changes
in the Group’s property, plant and equipment for the
three-month period ended September 30, 2017 and for the year ended
June 30, 2017 were as follows:
|
Period
ended
September
30, 2017
|
|
Year
ended June 30, 2017
|
|
Buildings and facilities
|
|
Machinery and equipment
|
|
Communication networks
|
|
Others
|
|
Total
|
|
Total
|
Costs
|
17,573
|
|
4,614
|
|
8,156
|
|
1,973
|
|
32,316
|
|
25,839
|
Accumulated
depreciation
|
(1,418)
|
|
(1,152)
|
|
(1,994)
|
|
(639)
|
|
(5,203)
|
|
(1,790)
|
Net book amount at the beginning of the year
|
16,155
|
|
3,462
|
|
6,162
|
|
1,334
|
|
27,113
|
|
24,049
|
Additions
|
194
|
|
173
|
|
273
|
|
233
|
|
873
|
|
2,751
|
Disposals
|
-
|
|
-
|
|
(39)
|
|
(9)
|
|
(48)
|
|
(241)
|
Reclassification
to assets held for sale
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1,557)
|
Impairment
/ recovery
|
(31)
|
|
-
|
|
-
|
|
-
|
|
(31)
|
|
12
|
Cumulative
translation adjustment
|
4
|
|
-
|
|
(6)
|
|
3
|
|
1
|
|
5,013
|
Transfers
to investment properties
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(156)
|
Depreciation
charges (i)
|
(174)
|
|
(168)
|
|
(299)
|
|
(132)
|
|
(773)
|
|
(2,758)
|
Balances at the end of the period / year
|
16,148
|
|
3,467
|
|
6,091
|
|
1,429
|
|
27,135
|
|
27,113
|
Costs
|
17,789
|
|
4,801
|
|
8,409
|
|
2,212
|
|
33,211
|
|
32,316
|
Accumulated
depreciation
|
(1,641)
|
|
(1,334)
|
|
(2,318)
|
|
(783)
|
|
(6,076)
|
|
(5,203)
|
Net book amount at the end of the period / year
|
16,148
|
|
3,467
|
|
6,091
|
|
1,429
|
|
27,135
|
|
27,113
|
(i)
As of September 30,
2017, depreciation charges of property, plant and equipment were
recognized as follows: Ps. 462 in "Costs", Ps. 39 in "General and
administrative expenses" and Ps. 272 in "Selling expenses",
respectively in the statement of income (Note 21).
IRSA Inversiones y Representaciones Sociedad
Anónima
Changes
in the Group’s trading properties for the three-month period
ended September 30, 2017 and for the year ended June 30, 2017 were
as follows:
|
Period
ended
September
30, 2017
|
|
Year
ended June 30, 2017
|
|
Completed properties
|
|
Properties under development
|
|
Undeveloped sites
|
|
Total
|
|
Total
|
Beginning of the period / year
|
801
|
|
3,972
|
|
1,008
|
|
5,781
|
|
4,971
|
Additions
|
-
|
|
347
|
|
26
|
|
373
|
|
1,229
|
Financial
costs capitalized
|
-
|
|
1
|
|
-
|
|
1
|
|
-
|
Cumulative
translation adjustment
|
40
|
|
24
|
|
(3)
|
|
61
|
|
971
|
Transfers
|
141
|
|
(83)
|
|
(57)
|
|
1
|
|
-
|
Transfers
from intangible assets
|
3
|
|
-
|
|
-
|
|
3
|
|
13
|
Transfers
from investment properties
|
351
|
|
-
|
|
-
|
|
351
|
|
14
|
Disposals
|
(34)
|
|
-
|
|
-
|
|
(34)
|
|
(1,417)
|
End of the period / year
|
1,302
|
|
4,261
|
|
974
|
|
6,537
|
|
5,781
|
|
September 30, 2017
|
|
June 30, 2017
|
Non-current
|
3,204
|
|
4,532
|
Current
|
3,333
|
|
1,249
|
Total
|
6,537
|
|
5,781
|
Changes
in the Group’s intangible assets for the three-month period
ended September 30, 2017 and for the year ended June 30, 2017 were
as follows:
|
Period
ended
September
30, 2017
|
|
Year
ended June 30, 2017
|
|
Goodwill
|
|
Trademarks
|
|
Licenses
|
|
Customer relations
|
|
Information systems and software
|
|
Contracts and others
|
|
Total
|
|
Total
|
Costs
|
2,778
|
|
4,029
|
|
1,002
|
|
4,746
|
|
2,103
|
|
1,659
|
|
16,317
|
|
12,979
|
Accumulated
amortization
|
-
|
|
(75)
|
|
(210)
|
|
(2,184)
|
|
(814)
|
|
(647)
|
|
(3,930)
|
|
(1,216)
|
Net book amount at the beginning of the period / year
|
2,778
|
|
3,954
|
|
792
|
|
2,562
|
|
1,289
|
|
1,012
|
|
12,387
|
|
11,763
|
Additions
|
-
|
|
-
|
|
-
|
|
22
|
|
119
|
|
40
|
|
181
|
|
612
|
Disposals
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(52)
|
Reclassifications
previous periods
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
31
|
Transfers
to assets held for sale
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(182)
|
Transfers
to trading properties
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(3)
|
|
(3)
|
|
(13)
|
Assets
incorporated by business combination
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
26
|
Cumulative
translation adjustment
|
(8)
|
|
(1)
|
|
(2)
|
|
(18)
|
|
-
|
|
(14)
|
|
(43)
|
|
2,284
|
Amortization
charges (i)
|
-
|
|
(9)
|
|
(18)
|
|
(229)
|
|
(114)
|
|
(94)
|
|
(464)
|
|
(2,082)
|
Balances at the end of the period / year
|
2,770
|
|
3,944
|
|
772
|
|
2,337
|
|
1,294
|
|
941
|
|
12,058
|
|
12,387
|
Costs
|
2,770
|
|
4,029
|
|
1,000
|
|
4,770
|
|
2,232
|
|
1,690
|
|
16,491
|
|
16,317
|
Accumulated
amortization
|
-
|
|
(85)
|
|
(228)
|
|
(2,433)
|
|
(938)
|
|
(749)
|
|
(4,433)
|
|
(3,930)
|
Net book amount at the end of the period / year
|
2,770
|
|
3,944
|
|
772
|
|
2,337
|
|
1,294
|
|
941
|
|
12,058
|
|
12,387
|
(i)
As of September 30,
2017, amortization charges were recognized in the amount of Ps. 108
in "Costs", Ps. 97 in "General and administrative expenses" and Ps.
259 in "Selling expenses", in the statement of income (Note
21).
IRSA Inversiones y Representaciones Sociedad
Anónima
13.
Financial
instruments by category
The
present note shows the financial assets and financial liabilities
by category of financial instrument and a reconciliation to the
corresponding line in the Consolidated Statements of Financial
Position, as appropriate. Financial assets and liabilities measured
at fair value are assigned based on their different levels in the
fair value hierarchy. For further information, related to fair
value hierarchy see Note 14 to the Consolidated Financial
Statements as of June 30, 2017.
Financial
assets and financial liabilities as of September 30, 2017 are as
follows:
|
Financial assets at amortized cost (i)
|
|
Financial assets at fair value through profit or loss
|
|
Subtotal financial assets
|
|
Non-financial assets
|
|
Total
|
|
|
|
Level 1
|
Level 2
|
Level 3
|
|
|
|
|
|
|
September 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
Assets as per Statement of Financial Position
|
|
|
|
|
|
|
|
|
|
|
|
Trade
and other receivables (excluding the allowance for doubtful
accounts and other receivables)
|
15,629
|
|
-
|
-
|
2,251
|
|
17,880
|
|
4,079
|
|
21,959
|
Investments
in financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
-
Public companies’ securities
|
-
|
|
2,174
|
-
|
110
|
|
2,284
|
|
-
|
|
2,284
|
-
Private companies’ securities
|
-
|
|
-
|
-
|
787
|
|
787
|
|
-
|
|
787
|
-
Deposits
|
1,316
|
|
14
|
-
|
-
|
|
1,330
|
|
-
|
|
1,330
|
-
Mutual funds
|
-
|
|
4,787
|
-
|
-
|
|
4,787
|
|
-
|
|
4,787
|
-
Bonds
|
-
|
|
7,693
|
363
|
-
|
|
8,056
|
|
-
|
|
8,056
|
-
Others
|
-
|
|
119
|
-
|
-
|
|
119
|
|
-
|
|
119
|
Derivative
financial instruments:
|
|
|
|
|
|
|
|
|
|
|
|
-
Foreign-currency future contracts
|
-
|
|
-
|
23
|
-
|
|
23
|
|
-
|
|
23
|
-
Swaps
|
-
|
|
-
|
4
|
-
|
|
4
|
|
-
|
|
4
|
-
Others
|
-
|
|
-
|
19
|
-
|
|
19
|
|
-
|
|
19
|
Restricted
assets
|
1,721
|
|
-
|
-
|
-
|
|
1,721
|
|
-
|
|
1,721
|
Financial
assets held for sale:
|
|
|
|
|
|
|
|
|
|
|
|
-
Clal
|
-
|
|
8,653
|
-
|
-
|
|
8,653
|
|
-
|
|
8,653
|
Cash
and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
-
Cash at bank and on hand
|
8,017
|
|
-
|
-
|
-
|
|
8,017
|
|
-
|
|
8,017
|
-
Short-term investments
|
14,729
|
|
3,286
|
-
|
-
|
|
18,015
|
|
-
|
|
18,015
|
Total assets
|
41,412
|
|
26,726
|
409
|
3,148
|
|
71,695
|
|
4,079
|
|
75,774
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities at amortized cost (i)
|
|
Financial liabilities at fair value through profit or
loss
|
|
Subtotal financial liabilities
|
|
Non-financial liabilities
|
|
Total
|
|
|
|
Level 1
|
Level 2
|
Level 3
|
|
|
|
|
|
|
September 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities as per Statement of Financial Position
|
|
|
|
|
|
|
|
|
|
|
|
Trade
and other payables
|
14,774
|
|
-
|
-
|
-
|
|
14,774
|
|
6,923
|
|
21,697
|
Borrowings
(excluding finance leases)
|
139,222
|
|
-
|
-
|
-
|
|
139,222
|
|
-
|
|
139,222
|
Derivative
financial instruments:
|
|
|
|
|
|
|
|
|
|
|
|
-
Foreign-currency future contracts
|
-
|
|
-
|
27
|
-
|
|
27
|
|
-
|
|
27
|
-
Swaps
|
-
|
|
-
|
14
|
-
|
|
14
|
|
-
|
|
14
|
-
Others
|
-
|
|
5
|
-
|
14
|
|
19
|
|
-
|
|
19
|
-
Forwards
|
-
|
|
-
|
110
|
-
|
|
110
|
|
-
|
|
110
|
Total liabilities
|
153,996
|
|
5
|
151
|
14
|
|
154,166
|
|
6,923
|
|
161,089
|
(i)
The fair value of
financial assets and liabilities at their amortized cost does not
differ significantly from their book value, except for borrowings
(Note 17).
IRSA Inversiones y Representaciones Sociedad
Anónima
Financial assets
and financial liabilities as of June 30, 2017 were as
follows:
|
Financial assets at amortized cost (i)
|
|
Financial assets at fair value through profit or loss
|
|
Subtotal financial assets
|
|
Non-financial assets
|
|
Total
|
|
|
|
Level 1
|
Level 2
|
Level 3
|
|
|
|
|
|
|
June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
Assets as per Statements of Financial Position
|
|
|
|
|
|
|
|
|
|
|
|
Trade
and other receivables (excluding the allowance for doubtful
accounts and other receivables)
|
16,575
|
|
-
|
-
|
2,156
|
|
18,731
|
|
3,819
|
|
22,550
|
Investments
in financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
-
Public companies’ securities
|
-
|
|
1,665
|
-
|
82
|
|
1,747
|
|
-
|
|
1,747
|
-
Private companies’ securities
|
-
|
|
16
|
-
|
964
|
|
980
|
|
-
|
|
980
|
-
Deposits
|
1,235
|
|
13
|
-
|
-
|
|
1,248
|
|
-
|
|
1,248
|
-
Mutual funds
|
-
|
|
3,855
|
-
|
-
|
|
3,855
|
|
-
|
|
3,855
|
-
Bonds
|
-
|
|
4,719
|
425
|
-
|
|
5,144
|
|
-
|
|
5,144
|
-
Others
|
-
|
|
749
|
-
|
-
|
|
749
|
|
-
|
|
749
|
Derivative
financial instruments:
|
|
|
|
|
|
|
|
|
|
|
|
-
Warrants
|
-
|
|
-
|
26
|
-
|
|
26
|
|
-
|
|
26
|
-
Foreign-currency future contracts
|
-
|
|
-
|
27
|
-
|
|
27
|
|
-
|
|
27
|
-
Swaps
|
-
|
|
-
|
29
|
-
|
|
29
|
|
-
|
|
29
|
Restricted
assets
|
954
|
|
-
|
-
|
-
|
|
954
|
|
-
|
|
954
|
Financial
assets held for sale:
|
|
|
|
|
|
|
|
|
|
|
|
-
Clal
|
-
|
|
8,562
|
-
|
-
|
|
8,562
|
|
-
|
|
8,562
|
Cash
and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
-
Cash at bank and on hand
|
8,529
|
|
-
|
-
|
-
|
|
8,529
|
|
-
|
|
8,529
|
-
Short term investments
|
14,510
|
|
1,815
|
-
|
-
|
|
16,325
|
|
-
|
|
16,325
|
Total assets
|
41,803
|
|
21,394
|
507
|
3,202
|
|
66,906
|
|
3,819
|
|
70,725
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities at amortized cost (i)
|
|
Financial liabilities at fair value through profit or
loss
|
|
Subtotal financial liabilities
|
|
Non-financial liabilities
|
|
Total
|
|
|
|
Level 1
|
Level 2
|
Level 3
|
|
|
|
|
|
|
June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities as per Statement of Financial Position
|
|
|
|
|
|
|
|
|
|
|
|
Trade
and other payables
|
16,166
|
|
-
|
-
|
-
|
|
16,166
|
|
7,713
|
|
23,879
|
Borrowings
(excluding finance leases)
|
129,412
|
|
-
|
-
|
-
|
|
129,412
|
|
-
|
|
129,412
|
Derivative
financial instruments:
|
|
|
|
|
|
|
|
|
|
|
|
-
Foreign-currency future contracts
|
-
|
|
-
|
5
|
-
|
|
5
|
|
-
|
|
5
|
-
Forwards
|
-
|
|
5
|
152
|
10
|
|
167
|
|
-
|
|
167
|
Total liabilities
|
145,578
|
|
5
|
157
|
10
|
|
145,750
|
|
7,713
|
|
153,463
|
(i)
The fair value of
financial assets and liabilities at their amortized cost does not
differ significantly from their book value, except for borrowings
(Note 17).
The
valuation models used by the Group for the measurement of Level 2
and Level 3 instruments are no different from those used as of June
30, 2017.
As of
September 30, 2017, there have been no changes to the economic or
business circumstances affecting the fair value of the financial
assets and liabilities of the Group.
IRSA Inversiones y Representaciones Sociedad
Anónima
The
Group uses a range of valuation models for the measurement of Level
2 and Level 3 instruments, details of which may be obtained from
the following table. When no quoted prices are available in an
active market, fair values (particularly with derivatives) are
based on recognized valuation methods.
|
|
|
|
|
|
|
|
|
Description
|
|
Pricing model / method
|
|
Parameters
|
|
Fair value hierarchy
|
|
Range
|
Trade
and other receivables - Cellcom
|
|
Discounted
cash flows
|
|
Discount
interest rate.
|
|
Level
3
|
|
3.3
|
Interest
rate swaps
|
|
Cash
flows - Theoretical price
|
|
Interest
rate futures contracts and cash flows
|
|
Level
2
|
|
-
|
Preferred
shares of Condor
|
|
Binomial
tree – Theoretical price I
|
|
Underlying
asset price (Market price); share price volatility (historical) and
market interest-rate (Libor rate curve).
|
|
Level
3
|
|
Underlying
asset price 1.8 to 2.2
Share
price volatility 58% to 78%
Market
interest-rate
1.7%
to 2.1%
|
Promissory
note
|
|
Discounted
cash flows - Theoretical price
|
|
Market
interest-rate (Libor rate curve)
|
|
Level
3
|
|
Market
interest-rate
1.8%
to 2.2%
|
Warrants
of Condor
|
|
Black-Scholes
– Theoretical price
|
|
Underlying
asset price (Market price); share price volatility (historical) and
market interest-rate (Libor rate curve).
|
|
Level
2
|
|
Underlying
asset price 1.8 to 1.7
Share
price volatility 58% to 78%
Market
interest-rate
1.7%
to 2.1%
|
Call
option of Arcos
|
|
Discounted
cash flows
|
|
Projected
revenues and discounting rate.
|
|
Level
3
|
|
-
|
Investments
in financial assets - Other private companies’
securities
|
|
Cash
flow / NAV - Theoretical price
|
|
Projected revenue
discounted at the discount rate /
The
value is calculated in accordance with shares in the equity funds
on the basis of their Financial Statements, based on fair value or
investments assessments.
|
|
Level
3
|
|
1 -
3.5
|
Investments
in financial assets - Others
|
|
Discounted
cash flow - Theoretical price
|
|
Projected revenue
discounted at the discount rate /
The
value is calculated in accordance with shares in the equity funds
on the basis of their Financial Statements, based on fair value or
investment assessments.
|
|
Level
3
|
|
1 -
3.5
|
Derivative
financial instruments – Forwards
|
|
Theoretical
price
|
|
Underlying
asset price and volatility
|
|
Level 2
and 3
|
|
-
|
The
following table presents the changes in Level 3 instruments as of
September 30, 2017 and June 30, 2017:
|
Investments in financial assets - Public companies’
Securities
|
|
Derivative financial instruments - Forwards
|
|
Investments in financial assets - Private companies’
Securities
|
|
Trade and other receivables
|
|
Total as of September 30, 2017
|
|
Total as of June 30, 2017
|
Balances at beginning of the period / year
|
82
|
|
(10)
|
|
964
|
|
2,156
|
|
3,192
|
|
(7,105)
|
Additions
and acquisitions
|
-
|
|
-
|
|
9
|
|
572
|
|
581
|
|
1,761
|
Transfer
to level 1 (i)
|
-
|
|
-
|
|
(110)
|
|
,
|
|
(110)
|
|
-
|
Transfer
to current trade and other receivables
|
-
|
|
-
|
|
-
|
|
(477)
|
|
(477)
|
|
(1,874)
|
Cumulative
translation adjustment
|
4
|
|
(4)
|
|
(28)
|
|
-
|
|
(28)
|
|
875
|
Reclassification
to liabilities held for sale
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
11,272
|
Write
off
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(782)
|
Gain
/ (loss) for the period / year (ii)
|
24
|
|
-
|
|
(48)
|
|
-
|
|
(24)
|
|
(955)
|
Balances at the end of the period / year
|
110
|
|
(14)
|
|
787
|
|
2,251
|
|
3,134
|
|
3,192
|
(i)
The group
transferred a financial asset measured at fair value from level 3
to level 1, because it began trading in the stock
exchange.
(ii)
Included within
“Financial results, net” in the Statements of
Income.
Clal
As
mentioned in Note 14 to the Annual Financial Statements, IDBD is
subject to a judicial process on the sale of its equity interest in
Clal. On August 30, 2017, IDBD sold an additional 5% of its equity
interest in Clal through a swap transaction, based on the same
principles that were applied to the swap transaction mentioned in
Note 14 to the Consolidated Financial Statements as of June 30,
2017. The consideration for the transaction amounted to around NIS
152.5 (equivalent to approximately Ps. 762 as of the transaction
date). Following completion of the transaction, IDBD’s
interest in Clal was reduced from 49.9% to 44.9% of its capital
stock.
IRSA Inversiones y Representaciones Sociedad
Anónima
14.
Trade
and other receivables
Group’s trade
and other receivables as of September 30, 2017 and June 30, 2017
are as follows:
|
September 30, 2017
|
|
June 30, 2017
|
|
Non-current
|
|
Current
|
|
Total
|
|
Non-current
|
|
Current
|
|
Total
|
|
Sale,
leases and services receivables
|
2,355
|
|
12,694
|
|
15,049
|
|
2,258
|
|
13,869
|
|
16,127
|
|
Less:
Allowance for doubtful accounts
|
-
|
|
(331)
|
|
(331)
|
|
(4)
|
|
(308)
|
|
(312)
|
|
Total trade receivables
|
2,355
|
|
12,363
|
|
14,718
|
|
2,254
|
|
13,561
|
|
15,815
|
|
Prepaid
expenses
|
1,685
|
|
770
|
|
2,455
|
|
1,669
|
|
863
|
|
2,532
|
|
Borrowings,
deposits and other debit balances
|
842
|
|
1,954
|
|
2,796
|
|
893
|
|
1,485
|
|
2,378
|
|
Advances
to suppliers
|
-
|
|
981
|
|
981
|
|
-
|
|
825
|
|
825
|
|
Tax
receivables
|
107
|
|
94
|
|
201
|
|
86
|
|
130
|
|
216
|
|
Others
|
96
|
|
381
|
|
477
|
|
72
|
|
400
|
|
472
|
|
Total other receivables
|
2,730
|
|
4,180
|
|
6,910
|
|
2,720
|
|
3,703
|
|
6,423
|
|
Total trade and other receivables
|
5,085
|
|
16,543
|
|
21,628
|
|
4,974
|
|
17,264
|
|
22,238
|
|
Movements on the
Group’s allowance for doubtful accounts were as
follows:
|
September 30,
2017
|
|
June 30,
2017
|
Beginning of the period / year
|
312
|
|
173
|
Additions
|
56
|
|
234
|
Recoveries
|
(7)
|
|
(11)
|
Cumulative
translation adjustment
|
1
|
|
182
|
Receivables
written off during the period/year as uncollectable
|
(31)
|
|
(266)
|
End of the period / year
|
331
|
|
312
|
The
creation and release of the allowance for doubtful accounts have
been included in “Selling expenses” in the Statement of
Income (Note 21).
15.
Cash
flow information
Following is a
detailed description of cash flows generated by the Group’s
operations for the three-month periods ended September 30, 2017 and
2016:
|
Note
|
September 30, 2017
|
|
September 30, 2016
(recast)
|
Profit
for the period
|
|
74
|
|
344
|
(Loss)
/ Profit for the period from discontinued operations
|
|
(13)
|
|
351
|
Adjustments for:
|
|
|
|
|
Income
tax
|
19
|
1,240
|
|
592
|
Amortization
and depreciation
|
21
|
1,237
|
|
1,113
|
Loss
from disposal of property, plant and equipment
|
|
22
|
|
7
|
Net
gain from fair value adjustment of investment
properties
|
|
(3,404)
|
|
(1,396)
|
Share-based
compensation
|
|
19
|
|
25
|
Gain
from disposal of subsidiary
|
|
(136)
|
|
-
|
Capitalized
leasing costs
|
|
(7)
|
|
(2)
|
Other
financial results, net
|
|
4,895
|
|
1,363
|
Provisions
and allowances
|
|
(41)
|
|
13
|
Share
of profit of associates and joint ventures
|
8
|
(398)
|
|
(9)
|
Changes in operating assets and liabilities:
|
|
|
|
|
Decrease
in inventories
|
|
665
|
|
478
|
Decrease
in trading properties
|
|
99
|
|
63
|
Decrease
/ (Increase) in trade and other receivables
|
|
988
|
|
(124)
|
Decrease
in trade and other payables
|
|
(2,261)
|
|
(87)
|
Decrease
in salaries and social security liabilities
|
|
(50)
|
|
(55)
|
Decrease
in provisions
|
|
(162)
|
|
(2)
|
Net cash generated by continuing operating activities before income
tax paid
|
|
2,767
|
|
2,674
|
Net
cash generated by discontinued operating activities before income
tax paid
|
|
66
|
|
98
|
Net cash generated by operating activities before income tax
paid
|
|
2,833
|
|
2,772
|
IRSA Inversiones y Representaciones Sociedad
Anónima
The
following tables show a detail of significant non-cash transactions
occurred in the three-month periods ended September 30, 2017 and
2016:
|
|
September 30, 2017
|
|
September 30, 2016 (recast)
|
|
Increase
in investments in associates and joint ventures through a decrease
in trade and other receivables
|
|
-
|
|
12
|
|
Decrease
in trade and other payables through a decrease in financial
assets
|
|
-
|
|
13
|
|
Increase
in investment properties through an increase in trade and other
payables
|
|
66
|
|
85
|
|
Increase
in restricted assets through an increase in borrowings
|
|
-
|
|
1,322
|
|
|
|
|
|
|
Balances
incorporated as result of business combination / reclassification
of assets and liabilities held for sale:
|
|
September 30, 2016 (recast)
|
Property,
plant and equipment
|
|
12
|
Intangible
assets
|
|
4
|
Investments
in associates and joint ventures
|
|
11,401
|
Deferred
income tax
|
|
(18)
|
Trade
and other receivables
|
|
(56)
|
Income
tax and MPIT credit
|
|
(1)
|
Group
of assets held for sale
|
|
(11,494)
|
Trade
and other payables
|
|
(17)
|
Salaries
and social security liabilities
|
|
(8)
|
Borrowings
|
|
(11,256)
|
Provisions
|
|
2
|
Income
tax and MPIT liabilities
|
|
2
|
Group
of liabilities held for sale
|
|
11,369
|
Net amount of non-cash assets incorporated / held for
sale
|
|
(60)
|
Cash
and cash equivalents
|
|
5
|
Non-controlling
interest
|
|
36
|
Goodwill
not yet allocated
|
|
(82)
|
Net amount of assets incorporated / held for sale
|
|
(101)
|
Interest
held before acquisition
|
|
59
|
Seller
financing
|
|
17
|
Cash
and cash equivalents incorporated / held for sale
|
|
(5)
|
Net outflow of cash and cash equivalents / assets and liabilities
held for sale
|
|
(30)
|
16.
Trade
and other payables
Group’s trade
and other payables as of September 30, 2017 and June 30, 2017 were
as follows:
|
September 30, 2017
|
|
June 30, 2017
|
|
Non-current
|
|
Current
|
|
Total
|
|
Non-current
|
|
Current
|
|
Total
|
Trade
payables
|
1,333
|
|
11,874
|
|
13,207
|
|
2,067
|
|
12,726
|
|
14,793
|
Sales,
rental and services payments received in advance
|
-
|
|
4,047
|
|
4,047
|
|
-
|
|
4,339
|
|
4,339
|
Construction
obligations
|
658
|
|
558
|
|
1,216
|
|
873
|
|
353
|
|
1,226
|
Accrued
invoices
|
-
|
|
790
|
|
790
|
|
-
|
|
633
|
|
633
|
Deferred
income
|
73
|
|
-
|
|
73
|
|
73
|
|
-
|
|
73
|
Total trade payables
|
2,064
|
|
17,269
|
|
19,333
|
|
3,013
|
|
18,051
|
|
21,064
|
Dividends
payable to non-controlling shareholders
|
-
|
|
53
|
|
53
|
|
-
|
|
251
|
|
251
|
Tax
payables
|
-
|
|
135
|
|
135
|
|
-
|
|
510
|
|
510
|
Construction
obligations
|
-
|
|
320
|
|
320
|
|
-
|
|
343
|
|
343
|
Non-current
other payables
|
63
|
|
1,793
|
|
1,856
|
|
27
|
|
1,684
|
|
1,711
|
Total other payables
|
63
|
|
2,301
|
|
2,364
|
|
27
|
|
2,788
|
|
2,815
|
Total trade and other payables
|
2,127
|
|
19,570
|
|
21,697
|
|
3,040
|
|
20,839
|
|
23,879
|
The
fair value of payables approximate their respective carrying
amounts because, due to their short-term nature, the effect of
discounting is not considered significant. Fair values are based on
discounted cash flows (Level 3).
IRSA Inversiones y Representaciones Sociedad
Anónima
The
breakdown of the Group’s borrowings as of September 30, 2017
and June 30, 2017 was as follows:
|
September 30, 2017
|
|
June 30, 2017
|
|
Non-current
|
|
Current
|
|
Total
|
|
Non-current
|
|
Current
|
|
Total
|
NCN
|
103,513
|
|
15,460
|
|
118,973
|
|
92,394
|
|
16,023
|
|
108,417
|
Bank
loans
|
15,091
|
|
2,837
|
|
17,928
|
|
9,924
|
|
2,088
|
|
12,012
|
Non-recourse
loans
|
-
|
|
-
|
|
-
|
|
7,025
|
|
-
|
|
7,025
|
Bank
overdrafts
|
-
|
|
451
|
|
451
|
|
-
|
|
91
|
|
91
|
Other
borrowings (i)
|
1,736
|
|
140
|
|
1,876
|
|
146
|
|
1,724
|
|
1,870
|
Total borrowings
|
120,340
|
|
18,888
|
|
139,228
|
|
109,489
|
|
19,926
|
|
129,415
|
(i)
Includes finance leases in the amount of Ps. 6 as of September 30,
2017 and Ps. 4 as of June 30, 2017.
Borrowings’
fair value as of September 30, 2017 and June 30, 2017, was as
follows:
|
September 30, 2017
|
|
June 30, 2017
|
|
Operations Center in Argentina
|
|
Operations Center in Israel
|
|
Total
|
|
Operations Center in Argentina
|
|
Operations Center in Israel
|
|
Total
|
NCN
|
14,714
|
|
107,040
|
|
121,754
|
|
10,647
|
|
99,517
|
|
110,164
|
Bank
loans
|
1,062
|
|
17,539
|
|
18,601
|
|
1,030
|
|
11,018
|
|
12,048
|
Bank
overdrafts
|
452
|
|
-
|
|
452
|
|
77
|
|
14
|
|
91
|
Non-recourse
loans
|
-
|
|
-
|
|
-
|
|
-
|
|
6,930
|
|
6,930
|
Other
borrowings
|
226
|
|
1,622
|
|
1,848
|
|
204
|
|
1,624
|
|
1,828
|
Total borrowings
|
16,454
|
|
126,201
|
|
142,655
|
|
11,958
|
|
119,103
|
|
131,061
|
Operations
Center in Argentina
IRSA CP
: On September 5, 2017
Class III and IV NCN were tendered under the Program approved for
up to US$ 500 for a nominal value of US$ 140 to be matured 36
months after the issuing date, paid in and payable in US Dollars,
which will accrue interest at an annual fixed interest rate of
5.0%, interest payable on a quarterly basis. Principal will be
amortized in only one installment due on September 14, 2020. The
settlement took place on September 12, 2017. The offering of Class
III NCN was declared vacant.
Operations
Center in Israel
IDBD
: In July 2017, IDBD made a
public offering of approximately NIS 642.1 nominal value of
corporate notes (Series N), the corporate notes accrue interest at
a 5% annual rate. Taking into account the issue costs, the net
consideration reflects an effective interest rate of 5.3% per year.
Principal will be canceled in only one installment due on December
30, 2022 and interest will be payable on a quarterly basis. IDBD is
entitled to redeem corporate notes, in whole or in part, through an
early redemption in accordance with the provisions of the issue
prospectus. To secure full compliance with all commitments, IDBD
has pledged around 60.4 million of shares of DIC with a single
first lien and in guarantee by means of the lien, in an unlimited
amount, in favor of the trustee for the benefit of corporate
note-holders.
DIC
: On September 28, 2017 DIC
offered the holders of NCN Series F to swap their notes for NCN
Series J. NCN Series J terms and conditions differ substantially
from those of Series F. Therefore, DIC recorded the payment of NCN
Series F and recognized a new financial commitment at fair value
for NCN Series J. As a result of the swap, DIC recorded a loss
resulting from the difference between the NCN Series F cancellation
value and the new debt value in the amount of approximately NIS 461
(equal to approximately Ps. 2,228 as of that date), which was
accounted for under “Financial costs” (Note
23).
IRSA Inversiones y Representaciones Sociedad
Anónima
The
table below shows the movements in the Group's provisions
categorized by type:
|
Period
ended
September
30, 2017
|
|
Year
ended June 30, 2017
|
|
Legal claims (i)
|
|
Investments in associates and joint ventures (ii)
|
|
Site dismantling and remediation
|
|
Onerous contracts
|
|
Other provisions
|
|
Total
|
|
Total
|
Beginning of period / year
|
821
|
|
72
|
|
140
|
|
220
|
|
580
|
|
1,833
|
|
1,571
|
Additions
|
55
|
|
-
|
|
-
|
|
-
|
|
(31)
|
|
24
|
|
502
|
Incorporated
by business combination
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
2
|
Recovery
|
(28)
|
|
(72)
|
|
(48)
|
|
(14)
|
|
-
|
|
(162)
|
|
(319)
|
Used
during the period / year
|
(8)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(8)
|
|
(219)
|
Currency
translation adjustment
|
2
|
|
-
|
|
(4)
|
|
(1)
|
|
(31)
|
|
(34)
|
|
296
|
End of period / year
|
842
|
|
-
|
|
88
|
|
205
|
|
518
|
|
1,653
|
|
1,833
|
(i)
Additions and
recoveries are included in "Other operating results,
net".
(ii)
As of June 30, 2017
corresponds to the equity interest in New Lipstick with negative
equity.
There
were no significant changes to the processes mentioned in Note 19
to the Consolidated Financial Statements as of June 30,
2017.
The
details of the provision for the Group’s income tax, is as
follows:
|
September 30, 2017
|
|
September 30,
2016
(recast)
|
Current
income tax
|
(193)
|
|
(160)
|
Deferred
income tax
|
(1,047)
|
|
(432)
|
Income tax from continuing operations
|
(1,240)
|
|
(592)
|
Below
is a reconciliation between income tax recognized and that which
would result applying the prevailing tax rate on profit before
income tax for the three-month periods ended September 30, 2017 and
2016:
|
September 30, 2017
|
|
September 30,
2016
(recast)
|
Loss from continuing operations at tax rate applicable in the
respective countries
|
(593)
|
|
(676)
|
Permanent differences:
|
|
|
|
Share
of profit of associates and joint ventures
|
65
|
|
198
|
Unrecognized
tax loss carryforwards (i)
|
(800)
|
|
(131)
|
Change
of income tax rate
|
-
|
|
65
|
Non-taxable
profit / (loss), non-deductible expenses and others
|
88
|
|
(48)
|
Income tax from continuing operations
|
(1,240)
|
|
(592)
|
(i)
Corresponds
principally to holding companies in Israel.
IRSA Inversiones y Representaciones Sociedad
Anónima
The
gross movement in the deferred income tax account is as
follows:
|
September 30,
2017
|
|
June 30,
2017
|
Beginning of period / year
|
(22,739)
|
|
(19,099)
|
Incorporated
by business combination
|
-
|
|
(6)
|
Reclassification
to liabilities held for sale
|
-
|
|
(12)
|
Use
of tax loss carryforwards
|
(184)
|
|
(171)
|
Change
of income tax rate
|
-
|
|
529
|
Reclassification
previous periods
|
-
|
|
59
|
Cumulative
translation adjustment
|
9
|
|
(1,440)
|
Deferred
income tax expense
|
(1,047)
|
|
(2,599)
|
End of period / year
|
(23,961)
|
|
(22,739)
|
|
September 30,
2017
|
|
September 30,
2016
(recast)
|
Revenue
from supermarkets
|
13,187
|
|
11,535
|
Income
from communication services
|
3,224
|
|
2,942
|
Rental
and services income
|
2,454
|
|
1,946
|
Sale
of communication equipment
|
1,059
|
|
959
|
Sale
of trading properties and development
|
64
|
|
221
|
Revenue
from hotel operation and tourism services
|
225
|
|
184
|
Total Group’s revenues
|
20,213
|
|
17,787
|
The
Group disclosed expenses in the statements of income by function as
part of the line items “Costs”, “General and
administrative expenses” and “Selling expenses”.
The following table provides additional disclosure regarding
expenses by nature and their relationship to the function within
the Group.
|
Costs
|
|
General and administrative expenses
|
|
Selling expenses
|
|
Total as of September 30, 2017
|
|
Total as of September 30, 2016 (recast)
|
Cost
of sale of goods and services
|
9,950
|
|
-
|
|
-
|
|
9,950
|
|
9,156
|
Salaries,
social security costs and other personnel expenses
|
1,144
|
|
403
|
|
1,319
|
|
2,866
|
|
2,389
|
Depreciation
and amortization
|
571
|
|
136
|
|
530
|
|
1,237
|
|
1,113
|
Fees
and payments for services
|
403
|
|
179
|
|
463
|
|
1,045
|
|
958
|
Maintenance,
security, cleaning, repairs and others
|
398
|
|
28
|
|
203
|
|
629
|
|
524
|
Advertising
and other selling expenses
|
74
|
|
-
|
|
380
|
|
454
|
|
423
|
Taxes,
rates and contributions
|
66
|
|
13
|
|
205
|
|
284
|
|
229
|
Interconnection
and roaming expenses
|
457
|
|
-
|
|
-
|
|
457
|
|
422
|
Fees
to other operators
|
518
|
|
-
|
|
-
|
|
518
|
|
362
|
Director´s
fees
|
-
|
|
53
|
|
-
|
|
53
|
|
38
|
Leases
and service charges
|
10
|
|
2
|
|
32
|
|
44
|
|
11
|
Allowance
for doubtful accounts, net
|
-
|
|
4
|
|
45
|
|
49
|
|
49
|
Other
expenses
|
136
|
|
177
|
|
384
|
|
697
|
|
673
|
Total as of September 30, 2017
|
13,727
|
|
995
|
|
3,561
|
|
18,283
|
|
|
Total as of September 30, 2016 (recast)
|
12,326
|
|
852
|
|
3,169
|
|
|
|
16,347
|
IRSA Inversiones y Representaciones Sociedad
Anónima
22.
Other
operating results, net
|
September 30, 2017
|
|
September 30,
2016
(recast)
|
Gain
from disposal of subsidiary
|
136
|
|
-
|
Donations
|
(17)
|
|
(11)
|
Lawsuits
and other contingencies (1)
|
(5)
|
|
(4)
|
Others
|
(90)
|
|
(54)
|
Total other operating results, net
|
24
|
|
(69)
|
(1) Includes
legal costs and expenses.
23.
Financial
results, net
|
September 30,
2017
|
|
September 30,
2016
(recast)
|
Finance
income:
|
|
|
|
-
Interest income
|
173
|
|
180
|
-
Foreign exchange gain
|
98
|
|
53
|
-
Dividends income
|
24
|
|
24
|
-
Other finance income
|
-
|
|
23
|
Total finance income
|
295
|
|
280
|
Finance
costs:
|
|
|
|
-
Interest expenses
|
(2,011)
|
|
(1,708)
|
-
Loss on debt swap (Note 17)
|
(2,228)
|
|
-
|
-
Foreign exchange loss
|
(629)
|
|
(202)
|
-
Other finance costs
|
(175)
|
|
(121)
|
Total finance costs
|
(5,043)
|
|
(2,031)
|
Other
financial results:
|
|
|
|
-
Fair value gain of financial assets and liabilities at fair value
through profit or loss, net
|
300
|
|
232
|
-
(Loss) / Gain on derivative financial instruments, net
|
(7)
|
|
30
|
Total other financial results
|
293
|
|
262
|
Total financial results, net
|
(4,455)
|
|
(1,489)
|
24.
CNV
General Resolution N° 622
As
required by Section 1°, Chapter III, Title IV of CNV General
Resolution N° 622, below there is a detail of the notes to the
Unaudited Condensed Interim Consolidated Financial Statements that
disclose the information required by the Resolution in
Exhibits.
Exhibit
A - Property, plant and equipment
|
Note 9
Investment properties and Note 10 Property, plant and
equipment
|
Exhibit
B - Intangible assets
|
Note 12
Intangible assets
|
Exhibit
C - Equity investments
|
Note 8
Equity interest in associates and joint ventures
|
Exhibit
D - Other investments
|
Note 13
Financial instruments by category
|
Exhibit
E - Provisions
|
Note 18
Provisions
|
Exhibit
F - Cost of sales and services provided
|
Note 11
Trading properties and Note 21 Expenses by nature
|
Exhibit
G - Foreign currency assets and liabilities
|
Note 26
Foreign currency assets and liabilities
|
IRSA Inversiones y Representaciones Sociedad
Anónima
25.
Related
party transactions
The
following is a summary of the balances with related parties as of
September 30, 2017:
Related party
|
|
Description of transaction
|
|
Non-current Investments in financial assets
|
|
Current Investments in financial assets
|
|
Non-current Trade and other receivables
|
|
Current
Trade and other receivables
|
|
Non-current Trade and other payables
|
|
Current
Trade and other payables
|
|
Non-current Borrowings
|
|
Current Borrowings
|
BHSA
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1)
|
|
-
|
|
-
|
|
|
Borrowings
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1)
|
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
-
|
|
2
|
|
-
|
|
-
|
|
-
|
|
-
|
Lipstick
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
2
|
|
-
|
|
-
|
|
-
|
|
-
|
Manibil
S.A.
|
|
Contributions
in advance
|
|
-
|
|
-
|
|
43
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
New
Lipstick
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
4
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Borrowings
|
|
-
|
|
-
|
|
-
|
|
174
|
|
-
|
|
-
|
|
-
|
|
-
|
Condor
|
|
Dividends
receivables
|
|
-
|
|
-
|
|
-
|
|
9
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Public
companies securities
|
|
110
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Tarshop
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
-
|
|
4
|
|
-
|
|
(1)
|
|
-
|
|
-
|
Total associates
|
|
|
|
110
|
|
-
|
|
43
|
|
195
|
|
-
|
|
(2)
|
|
-
|
|
(1)
|
Cyrsa
|
|
Borrowings
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(5)
|
Baicom
Networks S.A.
|
|
Distribution
pending
|
|
|
|
|
|
|
|
65
|
|
|
|
|
|
|
|
|
Mehadrin
|
|
Commissions
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(5)
|
|
-
|
|
-
|
LRSA
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
27
|
|
16
|
|
-
|
|
(1)
|
|
-
|
|
-
|
|
|
Reimbursement
of expenses
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
NPSF
|
|
Share-based
compensation plan
|
|
-
|
|
-
|
|
-
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Borrowings
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(4)
|
|
|
Advertising
spaces
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1)
|
|
-
|
|
-
|
Quality
|
|
Management
fees
|
|
-
|
|
-
|
|
-
|
|
5
|
|
-
|
|
-
|
|
-
|
|
-
|
Total joint ventures
|
|
|
|
-
|
|
-
|
|
27
|
|
88
|
|
-
|
|
(7)
|
|
-
|
|
(9)
|
Cresud
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(23)
|
|
-
|
|
-
|
|
|
Corporate
services
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(30)
|
|
-
|
|
-
|
|
|
NCN
|
|
-
|
|
250
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
-
|
|
4
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Long-term
incentive plan
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(2)
|
|
-
|
|
-
|
Total parent company
|
|
|
|
-
|
|
250
|
|
-
|
|
4
|
|
-
|
|
(55)
|
|
-
|
|
-
|
Carnes
Pampeanas
|
|
Other
Liabilities
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Consultores
Asset Management
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
4
|
|
-
|
|
-
|
|
-
|
|
-
|
Estudio
Zang, Bergel y Viñes
|
|
Legal
services
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1)
|
|
-
|
|
-
|
Export.
Agroindustriales Arg.
|
|
Other
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
(4)
|
|
|
|
|
IFISA
|
|
Borrowings
|
|
-
|
|
-
|
|
-
|
|
1,366
|
|
-
|
|
-
|
|
-
|
|
-
|
Taaman
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(24)
|
|
-
|
|
-
|
Willifood
|
|
NCN
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(33)
|
|
-
|
|
-
|
Museo
de los Niños
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
-
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
Directors
|
|
Fees
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(8)
|
|
(71)
|
|
-
|
|
-
|
Total others
|
|
|
|
-
|
|
-
|
|
-
|
|
1,371
|
|
(8)
|
|
(133)
|
|
-
|
|
-
|
Total as of 09.30.17
|
|
|
|
110
|
|
250
|
|
70
|
|
1,658
|
|
(8)
|
|
(197)
|
|
-
|
|
(10)
|
IRSA Inversiones y Representaciones Sociedad
Anónima
The
following is a summary of the balances with related parties as of
June 30, 2017:
Related party
|
|
Description of transaction
|
|
Non-current Investments in financial assets
|
|
Current Investments in financial assets
|
|
Non-current Trade and other receivables
|
|
Current
Trade and other receivables
|
|
Non-current Trade and other payables
|
|
Current
Trade and other payables
|
|
Non-current Borrowings
|
|
Current Borrowings
|
BHSA
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1)
|
|
-
|
|
-
|
|
|
Borrowings
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(2)
|
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
-
|
|
2
|
|
-
|
|
-
|
|
-
|
|
-
|
Lipstick
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
2
|
|
-
|
|
-
|
|
-
|
|
-
|
Manibil
S.A.
|
|
Contributions
in advance
|
|
-
|
|
-
|
|
83
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
New
Lipstick
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
5
|
|
-
|
|
-
|
|
-
|
|
-
|
Condor
|
|
Dividends
receivables
|
|
-
|
|
-
|
|
-
|
|
8
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Public
companies securities
|
|
82
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tarshop
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
-
|
|
2
|
|
-
|
|
(1)
|
|
-
|
|
-
|
Total associates
|
|
|
|
82
|
|
-
|
|
83
|
|
20
|
|
-
|
|
(2)
|
|
-
|
|
(2)
|
Cyrsa
|
|
Borrowings
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(5)
|
Mehadrin
|
|
Commissions
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(5)
|
|
-
|
|
-
|
LRSA
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
1
|
|
28
|
|
-
|
|
-
|
|
-
|
|
-
|
NPSF
|
|
Share-based
compensation plan
|
|
-
|
|
-
|
|
-
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Borrowings
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(4)
|
|
|
Advertising
spaces
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1)
|
|
-
|
|
-
|
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Management
fees
|
|
-
|
|
-
|
|
-
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
Quality
|
|
Management
fees
|
|
-
|
|
-
|
|
-
|
|
5
|
|
-
|
|
-
|
|
-
|
|
-
|
Total joint ventures
|
|
|
|
-
|
|
-
|
|
1
|
|
36
|
|
-
|
|
(6)
|
|
-
|
|
(9)
|
Cresud
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(36)
|
|
-
|
|
-
|
|
|
Corporate
services
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(23)
|
|
-
|
|
-
|
|
|
NCN
|
|
-
|
|
242
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
-
|
|
4
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Long-term
incentive plan
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1)
|
|
-
|
|
-
|
Total parent company
|
|
|
|
-
|
|
242
|
|
-
|
|
4
|
|
-
|
|
(60)
|
|
-
|
|
-
|
Carnes
Pampeanas
|
|
Other
liabilities
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Consultores
Asset Management
|
|
Reimbursement
of expenses
|
|
-
|
|
-
|
|
-
|
|
5
|
|
-
|
|
(3)
|
|
-
|
|
-
|
Estudio
Zang, Bergel y Viñes
|
|
Legal
services
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(4)
|
|
-
|
|
-
|
IFISA
|
|
Borrowings
|
|
-
|
|
-
|
|
-
|
|
1,283
|
|
-
|
|
-
|
|
-
|
|
-
|
Taaman
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(24)
|
|
-
|
|
-
|
Willifood
|
|
NCN
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(29)
|
|
-
|
|
-
|
Museo
de los Niños
|
|
Leases
and/or rights of use
|
|
-
|
|
-
|
|
-
|
|
2
|
|
-
|
|
-
|
|
-
|
|
-
|
Directors
|
|
Fees
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(44)
|
|
-
|
|
-
|
Total others
|
|
|
|
-
|
|
-
|
|
-
|
|
1,290
|
|
-
|
|
(104)
|
|
-
|
|
-
|
Total as of 06.30.17
|
|
|
|
82
|
|
242
|
|
84
|
|
1,350
|
|
-
|
|
(172)
|
|
-
|
|
(11)
|
IRSA Inversiones y Representaciones Sociedad
Anónima
The
following is a summary of the transactions with related parties for
the three-month period ended September 30, 2017:
Related party
|
|
Leases and/or
rights of use
|
|
Management fees
|
|
Sale of goods
|
|
Corporate services
|
|
Legal services
|
|
Financial operations
|
|
Donations
|
|
Fees and salaries
|
BACS
|
|
3
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Condor
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
6
|
|
-
|
|
-
|
Tarshop
|
|
5
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Total associates
|
|
8
|
|
-
|
|
-
|
|
-
|
|
-
|
|
6
|
|
-
|
|
-
|
NPSF
|
|
-
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Total joint ventures
|
|
-
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Cresud
|
|
1
|
|
-
|
|
-
|
|
(52)
|
|
-
|
|
4
|
|
-
|
|
-
|
Total parent company
|
|
1
|
|
-
|
|
-
|
|
(52)
|
|
-
|
|
4
|
|
-
|
|
-
|
Estudio
Zang, Bergel & Viñes
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(3)
|
|
-
|
|
-
|
|
-
|
Fundación
IRSA
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(4)
|
|
-
|
BHN
Vida S.A.
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Ramat
Hanassi
|
|
-
|
|
4
|
|
-
|
|
-
|
|
-
|
|
4
|
|
-
|
|
-
|
Ispro
- Mehadrín
|
|
-
|
|
-
|
|
-
|
|
31
|
|
-
|
|
-
|
|
-
|
|
-
|
Taaman
|
|
-
|
|
-
|
|
-
|
|
35
|
|
-
|
|
-
|
|
-
|
|
-
|
Willifood
|
|
-
|
|
-
|
|
-
|
|
70
|
|
-
|
|
-
|
|
-
|
|
-
|
IFISA
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
47
|
|
-
|
|
-
|
Directors
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(2)
|
Senior
Management
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(3)
|
Total others
|
|
1
|
|
4
|
|
-
|
|
136
|
|
(3)
|
|
51
|
|
(4)
|
|
(5)
|
Total as of 09.30.17
|
|
10
|
|
5
|
|
-
|
|
84
|
|
(3)
|
|
61
|
|
(4)
|
|
(5)
|
The
following is a summary of the transactions with related parties for
the three-month period ended September 30, 2016:
Related party
|
|
Leases and/or
rights of use
|
|
Management fees
|
|
Sale of goods
|
|
Corporate services
|
|
Legal services
|
|
Financial operations
|
|
Donations
|
|
Fees and salaries
|
BHSA
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1)
|
|
-
|
|
-
|
BACS
|
|
2
|
|
-
|
|
-
|
|
-
|
|
-
|
|
8
|
|
-
|
|
-
|
Adama
|
|
-
|
|
-
|
|
-
|
|
34
|
|
-
|
|
-
|
|
-
|
|
-
|
Condor
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
115
|
|
-
|
|
-
|
Tarshop
|
|
4
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Total associates
|
|
7
|
|
-
|
|
-
|
|
34
|
|
-
|
|
122
|
|
-
|
|
-
|
Cyrsa
S.A.
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1)
|
|
-
|
|
-
|
NPSF
|
|
(1)
|
|
1
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Total joint ventures
|
|
(1)
|
|
1
|
|
-
|
|
-
|
|
-
|
|
(1)
|
|
-
|
|
-
|
Cresud
|
|
-
|
|
-
|
|
-
|
|
(44)
|
|
-
|
|
11
|
|
-
|
|
-
|
Total parent company
|
|
-
|
|
-
|
|
-
|
|
(44)
|
|
-
|
|
11
|
|
-
|
|
-
|
Estudio
Zang, Bergel & Viñes
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(2)
|
|
-
|
|
-
|
|
-
|
LRSA
|
|
5
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Fundación
IRSA
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(2)
|
|
-
|
IFISA
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
26
|
|
-
|
|
-
|
Directors
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(45)
|
Senior
Management
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(3)
|
Total others
|
|
5
|
|
-
|
|
-
|
|
-
|
|
(2)
|
|
26
|
|
(2)
|
|
(48)
|
Total as of 09.30.16
|
|
11
|
|
1
|
|
-
|
|
(10)
|
|
(2)
|
|
158
|
|
(2)
|
|
(48)
|
IRSA
Inversiones y Representaciones Sociedad Anónima
26.
Foreign
currency assets and liabilities
Book
amounts of foreign currency assets and liabilities are as
follows:
Item / Currency (1)
|
Amount (2)
|
Exchange rate (3)
|
Total as of 09.30.17
|
Amount (2)
|
Exchange rate (3)
|
Total as of 06.30.17
|
Assets
|
|
|
|
|
|
|
Trade and other receivables
|
|
|
|
|
|
|
US
Dollar
|
74
|
17.210
|
1,279
|
35
|
16.530
|
572
|
Euros
|
8
|
20.294
|
160
|
9
|
18.848
|
172
|
Receivables with related parties:
|
|
|
|
|
|
|
US
Dollar
|
48
|
17.310
|
837
|
52
|
16.630
|
855
|
Total trade and other receivables
|
|
|
2,276
|
|
|
1,599
|
Restricted assets
|
|
|
|
|
|
|
US
Dollar
|
-
|
17.210
|
-
|
2
|
16.530
|
41
|
Total Restricted assets
|
|
|
-
|
|
|
41
|
Investments in financial assets
|
|
|
|
|
|
|
US
Dollar
|
146
|
17.210
|
2,508
|
61
|
16.530
|
1,014
|
Pounds
|
1
|
23.036
|
19
|
1
|
21.486
|
18
|
Investments with related parties:
|
|
|
|
|
|
|
US
Dollar
|
6
|
17.310
|
110
|
20
|
16.630
|
324
|
Total investments in financial assets
|
|
|
2,637
|
|
|
1,356
|
Derivative financial instruments
|
|
|
|
|
|
|
US
Dollar
|
1
|
17.210
|
14
|
1
|
16.530
|
10
|
Derivative financial instruments with related parties:
|
|
|
|
|
|
|
US
Dollar
|
-
|
17.310
|
-
|
2
|
16.630
|
26
|
Total Derivative financial instruments
|
|
|
14
|
|
|
36
|
Cash and cash equivalents
|
|
|
|
|
|
|
US
Dollar
|
265
|
17.210
|
4,555
|
318
|
16.530
|
5,250
|
Euros
|
2
|
20.294
|
41
|
3
|
18.848
|
49
|
New
Israel Shekel
|
-
|
4.770
|
-
|
-
|
4.770
|
1
|
Total Cash and cash equivalents
|
|
|
4,596
|
|
|
5,300
|
Total Assets
|
|
|
9,523
|
|
|
8,332
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
Trade and other payables
|
|
|
|
|
|
|
US
Dollar
|
109
|
17.310
|
1,894
|
57
|
16.630
|
955
|
Euros
|
18
|
20.455
|
363
|
1
|
19.003
|
19
|
Payables to related parties:
|
|
|
|
|
|
|
US
Dollar
|
1
|
17.310
|
23
|
1
|
16.630
|
21
|
Total Trade and other payables
|
|
|
2,280
|
|
|
995
|
Borrowings
|
|
|
|
|
|
|
US
Dollar
|
1,197
|
17.310
|
20,726
|
1,123
|
16.630
|
18,683
|
Total Borrowings
|
|
|
20,726
|
|
|
18,683
|
Total Liabilities
|
|
|
23,006
|
|
|
19,678
|
(1)
Considering
foreign currencies those that differ from each Group’s
subsidiaries functional currency at each
period/year-end.
(2)
Stated in millions
of the corresponding in foreign currency.
(3)
Exchange rates as
of September 30, 2017 and June 30, 2017, respectively according to
Banco Nación Argentina.
IRSA
Inversiones y Representaciones Sociedad Anónima
27.
Groups
of assets and liabilities held for sale
As
mentioned in Note 4.F to the Consolidated Financial Statements as
of June 30, 2017, the Group has certain assets and liabilities
classified as held for sale. The following table shows the main
ones:
|
September 30, 2017
|
|
June 30,
2017
|
Property,
plant and equipment
|
1,646
|
|
1,712
|
Intangible
assets
|
19
|
|
19
|
Investments
in associates
|
77
|
|
33
|
Deferred
income tax assets
|
57
|
|
57
|
Employee
benefits
|
-
|
|
5
|
Income
tax credits
|
-
|
|
10
|
Trade
and other receivables
|
867
|
|
688
|
Cash
and cash equivalents
|
153
|
|
157
|
Total group of assets held for sale
|
2,819
|
|
2,681
|
Trade
and other payables
|
1,120
|
|
930
|
Salaries
and social security liabilities
|
124
|
|
148
|
Employee
benefits
|
110
|
|
52
|
Deferred
income tax liability
|
24
|
|
10
|
Borrowings
|
644
|
|
715
|
Total group of liabilities held for sale
|
2,022
|
|
1,855
|
Total net assets held for sale
|
797
|
|
826
|
28.
Results
from discontinued operations
The
results from operations of Israir, Open Sky and IDB Tourism, and
the share of profit of Adama and the finance costs associated to
the non-recourse loan, until its sale in November 2016; have been
reclassified in the Statements of Income under discontinued
operations.
|
September 30, 2017
|
|
September 30, 2016
(recast)
|
Revenues
|
1,362
|
|
900
|
Costs
|
(1,204)
|
|
(784)
|
Gross profit
|
158
|
|
116
|
General
and administrative expenses
|
(57)
|
|
(52)
|
Selling
expenses
|
(66)
|
|
(56)
|
Other
operating results, net
|
(9)
|
|
7
|
Profit from operations
|
26
|
|
15
|
Share
of profit of joint ventures and associates
|
9
|
|
164
|
Profit before financial results and income tax
|
35
|
|
179
|
Finance
cost
|
(22)
|
|
(530)
|
Financial results, net
|
(22)
|
|
(530
)
|
Profit / (Loss) before income tax
|
13
|
|
(351)
|
Income
tax
|
-
|
|
-
|
Profit / (Loss) from discontinued operations
|
13
|
|
(351)
|
Sale of ADS issued by IRSA CP
During
October 2017, IRSA completed the sale in the secondary market of
10,240,000 ordinary shares of IRSA CP, N.V. Ps. 1 per share,
represented by American Depositary Shares (“ADSs”),
representing four ordinary shares each (nearly 8.1% of IRSA CP
capital). After the transaction, IRSA’s direct and indirect
interest in IRSA CP amounts to approximately 86.5%.
IRSA
Inversiones y Representaciones Sociedad Anónima
IRSA CP Dividend
IRSA CP
Shareholders’ Meeting, held on October 31, 2017, approved
among others, the distribution of a cash dividend in the amount of
Ps. 680, in addition to the Ps. 310 of advanced dividends approved
by the Shareholders’ Meeting held April 5, 2017. The
authority to effect payment was delegated to the Board of
Directors, which on November 1, 2017 resolved to made it available
to shareholders on November 14, 2017.
Furthermore, the
Shareholders’ Meeting decided to appropriate the remaining
undistributed earnings in the amount of Ps. 2,270 to a special
reserve, since the statutory reserve is fully funded as provided by
section 70 of Act 19,550, and section 5, chapter III, Title IV of
the Argentine Securities and Exchange Commission Rules. The special
reserve will be used for future dividends, new projects or pipeline
projects or for any other purpose that the Company may consider in
the future fiscal years, as part of a prudent and reasonable
administration of the Company.
In
addition, it decided to renew the empowerment onto the Board of
Directors to expand the current US$ 500 (five hundred million US
Dollars) program by an additional amount of US$ 100 (one hundred
million US Dollars), in accordance with the resolutions adopted by
the priors Shareholders’ Meetings on October 30, 2015 and
October 31, 2016.
IRSA Dividend
IRSA
Shareholders’ Meeting, held on October 31, 2017, approved
among others, the distribution of a cash dividend in the amount of
Ps. 1,400. The authority to effect payment was delegated to the
Board of Directors, which on November 1, 2017 resolved to made it
available to shareholders on November 14, 2017.
Furthermore, the
Shareholders’ Meeting decided to appropriate the remaining
undistributed earnings in the amount of Ps. 2,081 to a special
reserve, since the statutory reserve is fully funded as provided by
section 70 of Act 19,550, and section 5, chapter III, Title IV of
the Argentine Securities and Exchange Commission Rules. The special
reserve will be used for future dividends, new projects or pipeline
projects or for any other purpose that the Company may consider in
the future fiscal years, as part of a prudent and reasonable
administration of the Company.
On the
other hand, it resolved to empower the Board of Directors for the
creation of a new global program for the issuance of simple NCN,
either secured or unsecured or guaranteed by third parties, for a
total amount of up to US$ 350 (three hundred and fifty million US
Dollars) (or an equivalent amount in other currencies) given the
expiration of the current program.
Early repayment of debt
On
November 1, 2017, IDBD communicated its intention to repay all
Series L debentures on November 28, 2017 before maturity by an
amount of NIS 424 (or Ps. 2,022 as of the closing date of these
Financial Statements).