UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15b-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of October 2017
Commission File Number 001-35591
GRAÑA Y MONTERO S.A.A.
(Exact name of registrant as specified in its charter)
GRAÑA Y MONTERO GROUP
(Translation of registrant’s name into English)
Republic of Peru
(Jurisdiction of incorporation or organization)
Avenida Paseo de la República 4667, Lima 34,
Surquillo, Lima
Peru
(
Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F ___X____ Form 40-F _______
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [ ]
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): [ ]
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes _______ No ___
X
____
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): Not applicable.
October 30, 2017
Messrs.,
Superintendencia del Mercado de Valores – SMV
Present. -
Reference: Relevant Information Communication
Dear Sirs:
Hereby, in accordance with the provisions of article 28 of the Securities Market Law – whose Consolidated Text was approved by Supreme Decree No. 093-2002-EF- and by the Regulations of Relevant and Reserved Information Communications, approved by Resolution SMV N ° 005-2014-SMV / 01, we comply with informing, as Relevant Information Communication, that today, the Board of Directors of Graña y Montero S.A.A (the "Company"), in accordance with the financial information presented by management, has approved certain adjustments to the unaudited financial statements of the Company that were closed as of December 31, 2016. These adjusted financial statements are attached as Appendix 1 to this communication.
Bearing in mind that most of these adjustments are clearly accounting adjustments, they do not represent a material impairment of the Company's financial situation and are mainly due to circumstances that occurred during 2017, which -according to the interactions that were maintained with Gaveglio, Aparicio y Asociados S.C. of R.L. (PWC) before the termination of the audit contract-, it was convenient to include them in the financial statements as of December 31, 2016. Appendix 2 of this communication includes an explanation of the main adjustments.
____________________
/s/ Claudia Drago Morante
Stock Market Representative
Graña y Montero S.A.A.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
GRAÑA Y MONTERO S.A.A.
By: /s/ CLAUDIA DRAGO MORANTE
Name: Claudia Drago Morante
Title: Stock Market Representative
Date: October 30, 2017
APPENDIX 1
UNAUDITED FINANCIAL STATEMENTS OF GRAÑA Y MONTERO S.A.A.,
CLOSED AS OF DECEMBER 31, 2016
|
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
2016
|
|
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
Current liabilities
|
|
|
|
|
Cash and cash equivalents
|
|
|
606,949
|
|
Borrowings
|
|
|
1,961,043
|
|
|
Financial asset at fair value through profit or loss
|
|
|
|
|
Bonds
|
|
|
46,091
|
|
|
Trade accounts receivables
|
|
|
1,086,913
|
|
Trade accounts payable
|
|
|
1,278,387
|
|
|
Unbilled work in progress
|
|
|
683,242
|
|
Accounts payable to related parties
|
|
|
80,217
|
|
|
Accounts receivable from related parties
|
|
|
181,664
|
|
Current income tax
|
|
|
62,160
|
|
|
Other accounts receivable
|
|
|
659,377
|
|
Other accounts payable
|
|
|
1,096,307
|
|
|
Inventories
|
|
|
1,107,702
|
|
Provisions
|
|
|
14,531
|
|
|
Prepaid expenses
|
|
|
51,348
|
|
Total current liabilities
|
|
|
4,538,736
|
|
|
|
|
|
4,377,547
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current liabilities
|
|
|
|
|
|
Non-current assets classified as held for sale
|
|
|
|
|
Borrowings
|
|
|
419,395
|
|
|
|
|
|
|
|
Long-term bonds
|
|
|
921,623
|
|
|
Total current assets
|
|
|
4,399,932
|
|
Other long-term accounts payable
|
|
|
512,803
|
|
|
|
|
|
|
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Long-term accounts payable to related parties
|
|
|
|
|
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Non-current assets
|
|
|
|
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Provisions
|
|
|
31,155
|
|
|
Long-term trade accounts receivable
|
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|
667,519
|
|
Derivative financial instruments
|
|
|
1,081
|
|
|
Long-term unbilled work in progress
|
|
|
197,586
|
|
Deferred income tax liability
|
|
|
75,983
|
|
|
Long-term accounts receivable from related parties
|
|
|
|
|
Total non-current liabilities
|
|
|
2,027,360
|
|
|
Prepaid expenses
|
|
|
23,526
|
|
Total liabilities
|
|
|
6,566,096
|
|
|
Other long-term accounts receivable
|
|
|
357,952
|
|
|
|
|
|
|
|
Available-for-sale financial assets
|
|
|
-
|
|
Equity
|
|
|
|
|
|
Investments in associates and joint ventures
|
|
|
|
|
Capital
|
|
|
660,054
|
|
|
Investment property
|
|
|
49,357
|
|
Legal reserve
|
|
|
132,011
|
|
|
Property, plant and equipment
|
|
|
1,113,599
|
|
Optional reserve
|
|
|
29,974
|
|
|
Intangible assets
|
|
|
960,286
|
|
Share Premium
|
|
|
882,464
|
|
|
Deferred income tax asset
|
|
|
292,375
|
|
Other reserves
|
|
|
(167,572
|
)
|
|
Total non-current assets
|
|
|
5,137,029
|
|
Retained earnings
|
|
|
916,396
|
|
|
|
|
|
|
|
Equity attributable to controlling interest in the Company
|
|
|
|
|
|
|
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Non-controlling interest
|
|
|
517,538
|
|
|
|
|
|
|
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Total equity
|
|
|
2,970,865
|
|
|
Total assets
|
|
|
9,536,961
|
|
Total liabilities and equity
|
|
|
9,536,961
|
|
|
CONSOLIDATED INCOME STATEMENT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
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|
|
|
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For the year
|
|
|
|
|
|
|
|
|
ended December 31,
|
|
|
|
Note
|
|
2015
|
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Revenues from construction activities
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|
5,513,655
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|
|
|
3,945,599
|
|
|
Revenues from services provided
|
|
|
|
1,901,498
|
|
|
|
1,895,296
|
|
|
Revenue from real estate and sale of goods
|
|
|
|
417,280
|
|
|
|
643,373
|
|
|
|
|
|
|
7,832,433
|
|
|
|
6,484,268
|
|
|
|
|
|
|
|
|
|
|
|
|
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Cost of construction activities
|
|
|
|
(5,310,003
|
)
|
|
|
(3,757,032
|
)
|
|
Cost of services provided
|
|
|
|
(1,523,358
|
)
|
|
|
(1,671,783
|
)
|
|
Cost of real estate and goods sold
|
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|
(296,267
|
)
|
|
|
(440,786
|
)
|
|
|
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|
(7,129,628
|
)
|
|
|
(5,869,601
|
)
|
|
Gross profit
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|
|
|
702,805
|
|
|
|
614,667
|
|
|
|
|
|
|
|
|
|
|
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Administrative expenses
|
|
|
|
(413,380
|
)
|
|
|
(398,695
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)
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|
Other income and expenses
|
|
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|
57,287
|
|
|
|
(13,270
|
)
|
|
Gain from the sale of investments
|
|
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|
(8,289
|
)
|
|
|
46,336
|
|
|
Operating profit
|
|
|
|
338,423
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|
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|
249,038
|
|
|
|
|
|
|
|
|
|
|
|
|
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Financial expenses
|
|
|
|
(176,802
|
)
|
|
|
(174,789
|
)
|
|
Financial income
|
|
|
|
38,107
|
|
|
|
20,792
|
|
|
Share of the profit or loss in associates and joint
|
|
|
|
|
|
|
|
|
|
|
ventures under the equity method of accounting
|
|
|
|
17,603
|
|
|
|
(102,491
|
)
|
|
Profit before income tax
|
|
|
|
217,331
|
|
|
|
(7,450
|
)
|
|
Income tax
|
|
|
|
(75,619
|
)
|
|
|
(48,960
|
)
|
|
Profit for the period
|
|
|
|
141,712
|
|
|
|
(56,410
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable to:
|
|
|
|
|
|
|
|
|
|
|
Owners of the Company
|
|
|
|
88,154
|
|
|
|
(117,735
|
)
|
|
Non-controlling interest
|
|
|
|
53,558
|
|
|
|
61,325
|
|
|
|
|
|
|
141,712
|
|
|
|
(56,410
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share from continuing operations
|
|
|
|
|
|
|
|
|
|
|
attributable to owners of the Company during
|
|
|
|
|
|
|
|
|
|
|
the period
|
|
|
|
0.134
|
|
|
|
-0.178
|
|
|
CONSOLIDATED STATEMENT OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the year
|
|
|
|
|
|
|
|
|
ended December 31,
|
|
|
|
Note
|
|
2015
|
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
Profit before income tax
|
|
|
|
217,331
|
|
|
|
(7,450
|
)
|
|
Adjustments to profit not affecting cash flows from
|
|
|
|
|
|
|
|
|
|
|
operating activities:
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
|
217,070
|
|
|
|
205,522
|
|
|
Amortization of other assets
|
|
|
|
89,355
|
|
|
|
82,743
|
|
|
Impairment of inventories
|
|
|
|
17
|
|
|
|
36,353
|
|
|
Impairment of accounts receivable and other accounts receivable
|
|
|
|
5,806
|
|
|
|
419,584
|
|
|
Debt forgiveness
|
|
|
|
-
|
|
|
|
(431,484
|
)
|
|
Impairment of property, plant and equipment
|
|
|
|
9,677
|
|
|
|
9,263
|
|
|
Impairment of intangible assets
|
|
|
|
-
|
|
|
|
54,308
|
|
|
Financial expenses-CCDS
|
|
|
|
-
|
|
|
|
7,004
|
|
|
Expenses for liquidation of works - CCDS
|
|
|
|
-
|
|
|
|
164
|
|
|
Indemnification for lost profit
|
|
|
|
-
|
|
|
|
(33,600
|
)
|
|
Profit on fair value of financial asset at fair value through profit or loss
|
|
|
|
(2,740
|
)
|
|
|
31
|
|
|
Change in the fair value of the liability for put option
|
|
|
|
(18,627
|
)
|
|
|
(984
|
)
|
|
Other Provisions
|
|
|
|
6,398
|
|
|
|
6,500
|
|
|
Dividends income from available-for-sale financial assets
|
|
|
|
(7,215
|
)
|
|
|
-
|
|
|
Return receipt from Morelco
|
|
|
|
-
|
|
|
|
(6,658
|
)
|
|
Remeasurement of purchase consideration of Morelco
|
|
|
|
-
|
|
|
|
(7,166
|
)
|
|
Financial expense,net
|
|
|
|
129,365
|
|
|
|
106,742
|
|
|
Other provisions in CCDS
|
|
|
|
-
|
|
|
|
24,915
|
|
|
Share of the profit and loss in associates and joint ventures
|
|
|
|
|
|
|
|
|
|
|
under the equity method of accounting
|
|
|
|
(34,872
|
)
|
|
|
102,491
|
|
|
Reversal of provisions
|
|
|
|
(7,796
|
)
|
|
|
(20,853
|
)
|
|
Lower of fixed assets
|
|
|
|
-
|
|
|
|
3,951
|
|
|
Lower of investments
|
|
|
|
2,755
|
|
|
|
1,227
|
|
|
Profit on sale of property, plant and equipment
|
|
|
|
(17,385
|
)
|
|
|
(18,393
|
)
|
|
Loss on financial asset at fair value through profit or loss
|
|
|
|
279
|
|
|
|
221
|
|
|
Loss on sale of non-current asset held for sale
|
|
|
|
171
|
|
|
|
22
|
|
|
Profit on sale from available-for-sale financial assets
|
|
|
|
-
|
|
|
|
(46,337
|
)
|
|
Loss on sale of investments in subsidiaries
|
|
|
|
8,289
|
|
|
|
-
|
|
|
Loss on remeasurement of accounts receivable
|
|
|
|
-
|
|
|
|
20,274
|
|
|
Loss on remeasurement of investment
|
|
|
|
-
|
|
|
|
6,832
|
|
|
Net variations in assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
Trade accounts receivable
|
|
|
|
(99,446
|
)
|
|
|
108,358
|
|
|
Other accounts receivable
|
|
|
|
(188,053
|
)
|
|
|
(82,838
|
)
|
|
Other accounts receivable from related parties
|
|
|
|
(133,286
|
)
|
|
|
84,449
|
|
|
Inventories
|
|
|
|
(215,196
|
)
|
|
|
30,300
|
|
|
Pre-paid expenses and other assets
|
|
|
|
11,667
|
|
|
|
(146
|
)
|
|
Trade accounts payable
|
|
|
|
199,400
|
|
|
|
(85,781
|
)
|
|
Other accounts payable
|
|
|
|
(45,096
|
)
|
|
|
114,476
|
|
|
Other accounts payable to related parties
|
|
|
|
13,961
|
|
|
|
45,908
|
|
|
Other provisions
|
|
|
|
(6,770
|
)
|
|
|
(2,756
|
)
|
|
Interest payment
|
|
|
|
(114,027
|
)
|
|
|
(171,572
|
)
|
|
Payments related to Norvial Concession
|
|
|
|
(142,575
|
)
|
|
|
(97,711
|
)
|
|
Payment of income tax
|
|
|
|
(150,434
|
)
|
|
|
(125,433
|
)
|
|
Net cash applied to operating activities
|
|
|
|
(271,977
|
)
|
|
|
332,476
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
Sale of available-for-sale investment
|
|
|
|
26
|
|
|
|
107,341
|
|
|
Sale of a financial asset through profit or loss
|
|
|
|
4,604
|
|
|
|
-
|
|
|
Sale of property, plant and equipment
|
|
|
|
55,832
|
|
|
|
66,086
|
|
|
Sale of financial asset at fair value through profit or loss
|
|
|
|
-
|
|
|
|
1,427
|
|
|
Sale of non-current assets held for sale
|
|
|
|
8,801
|
|
|
|
117
|
|
|
Refunding for price adjustment
|
|
|
|
-
|
|
|
|
6,658
|
|
|
Return of contributions
|
|
|
|
481
|
|
|
|
1,963
|
|
|
Interest received
|
|
|
|
32,162
|
|
|
|
15,368
|
|
|
Dividends received
|
|
|
|
59,175
|
|
|
|
27,992
|
|
|
Payment for purchase of a non-current asset held for sale
|
|
|
|
(22,297
|
)
|
|
|
-
|
|
|
Payment for purchase of investments properties
|
|
|
|
(748
|
)
|
|
|
(17,543
|
)
|
|
Payments for intangible purchase
|
|
|
|
(32,883
|
)
|
|
|
(45,706
|
)
|
|
Payments for purchase and contributions on investment in associate and joint ventures
|
|
|
|
(463,103
|
)
|
|
|
(389,658
|
)
|
|
Payments for property, plant and equipment purchase
|
|
|
|
(193,156
|
)
|
|
|
(147,732
|
)
|
|
Net cash applied to investing activities
|
|
|
|
(551,106
|
)
|
|
|
(373,687
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
Loans received
|
|
|
|
4,442,858
|
|
|
|
3,941,750
|
|
|
Bonds issued
|
|
|
|
814,016
|
|
|
|
178,640
|
|
|
Amortization of loans received
|
|
|
|
(4,563,855
|
)
|
|
|
(3,914,570
|
)
|
|
Amortization of bonds issued
|
|
|
|
(16,480
|
)
|
|
|
(25,281
|
)
|
|
Payment for transaction costs for debt
|
|
|
|
(18,516
|
)
|
|
|
(650
|
)
|
|
Dividends paid to owners of the parent
|
|
|
|
(104,911
|
)
|
|
|
(30,853
|
)
|
|
Dividends paid to non-controlling interest
|
|
|
|
(4,535
|
)
|
|
|
(25,473
|
)
|
|
Cash received from non-controlling shareholders
|
|
|
|
10,329
|
|
|
|
8,034
|
|
|
Acquisition or sale of interest in a subsidiary of non-controlling shareholders
|
|
|
|
(223
|
)
|
|
|
(45,835
|
)
|
|
Net cash provided by financing activities
|
|
|
|
558,683
|
|
|
|
85,762
|
|
|
Net increase (net decrease) in cash
|
|
|
|
(264,400
|
)
|
|
|
44,551
|
|
|
Cash and cash equivalents at the beginning of the year
|
|
|
|
818,402
|
|
|
|
554,002
|
|
|
Cash and cash equivalents at the end of the period
|
|
|
|
554,002
|
|
|
|
598,553
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-CASH TRANSACTIONS:
|
|
|
|
|
|
|
|
|
|
|
Indemnification for lost profit
|
|
|
|
-
|
|
|
|
33,600
|
|
|
Debt capitalization
|
|
|
|
-
|
|
|
|
8,308
|
|
|
Acquisition of assets through finance leases
|
|
|
|
92,093
|
|
|
|
65,336
|
|
|
Recognition of debt as guarantor
|
|
|
|
-
|
|
|
|
608,247
|
|
|
Change in fair value of available-for-sale financial assets
|
|
|
|
19,973
|
|
|
|
-
|
|
|
Adjustment for deconsolidation of former subsidiaries
|
|
|
|
9,298
|
|
|
|
-
|
|
|
Establishment of joint operation - Panorama Plaza de negocios (net assets)
|
|
|
|
36,180
|
|
|
|
-
|
|
APPENDIX 2
EXPLANATION OF THE MAIN ADJUSTMENTS
From the business
|
Provision rebate / miscellaneous adjustments
|
(a)
|
S/ 5.36 million
|
|
Sunat Audit for Year 2001
|
(b)
|
S/ 14,17 million
|
|
Total
|
S/ 19.53 million
|
Acquisitions
|
Goodwill deterioration – Vial y Vives
|
(c)
|
S/ 54.93 million
|
|
Redemption of the acquisition value of Adexus
|
(d)
|
S/ 8,87 million
|
|
Total
|
S/ 63.80 million
|
Southern Gas Pipeline
|
Conversion to company in liquidation (CCDS)
|
(e)
|
S/ 15.16 million
|
|
Discount of the account receivable from GSP
|
(f)
|
S/ 33,61 million
|
|
Total
|
S/ 48.77 million
|
|
TOTAL GROSS EFFECTS
|
S/ 132.1 million
|
|
TOTAL NET EFFECTS
|
S/ 126.3 million
|
(a) Provision rebate/miscellaneous adjustments (S/ 5.3 million): Corresponds to the net amount of provisions rebate and/or adjustments made, within the framework of the interactions held with Gaveglio, Aparicio and Asociados S.C. of R.L. - PWC ("PWC"), as part of the external audit process that was been carried out with PWC.
(b) Sunat Audit for Year 2001 (S/14.1 million): This amount corresponds to an audit process initiated by Sunat in 2004 for the year 2001, which was resolved in September 2017 with an unfavorable result.
(c) Goodwill deterioration of Vial and Vives-DSD (S/ 54 million): The evaluation of the value of said company at the end of 2016 determined that there was no goodwill deterioration. However, during the audit process, the commercial perspectives used in determining the company's value were reviewed, adjusting them to the reality of the Chilean market and it was concluded that there was a deterioration in the investment.
(d) Redemption of the acquisition value of Adexus (S/ 8.8 million): After the interactions that were held with PWC, it was determined that the acquisition value estimated at the closing date of 2016 had to be adjusted, generating a negative impact of S/ 8.8 million
(e) Liquidation of the Ductos del Sur Construction Consortium (S/ 15.16 million): Given the termination of the gas concession contract for Gasoducto Sur Peruano that occurred in January 2017, the consortium should be registered as a company in process of liquidation. Said adjustment has generated a negative effect of S/ 15.1 million.
(f) Discount of the account receivable for the termination of the Gasoducto Sur Peruano concession contract (S/ 33.61 million): At the end of 2016, the discount of the account receivable was calculated considering the provisions of the concession contract.According to this contract, the recovery should occur within one year, which is why a one-year discount was established at the corresponding interest rate for that period. However, having passed several months since the termination of the contract without having initiated the return of the investment process, it has been estimated that the recovery of the same would occur in a longer period. The discount period applied is two years, which has generated a greater discount.
It is noted that - in accordance with what was indicated in the Relevant Information Communication of October 25, 2017 - the Company is conducting a comprehensive assessment of the impacts that a possible dispute with the Peruvian State in relation to the procedures for the termination of the GSP Project could have on the financial statements of the Company. After this evaluation has been carried out, it will be evaluated if it is necessary to make an additional adjustment for this concept.