SOCIETE FINANCIERE DES CAOUTCHOUCS
2022
ANNUAL REPORT
Socfin
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Socfin
Table of contents
Group profile 4
1. Overview of the Group 4
2. History 4
3. Group structure 5
4. Information on the holdings of Socfin 6
International market for rubber and palm oil 9
1. Rubber 9
2. Palm oil 12
Environment and social responsibility 15
Key figures 16
1. Activity Indicators 16
2. Key figures in the consolidated income statement 17
3. Key figures in the consolidated statement of financial position 17
Stock market data 18
Corporate governance statement 19
1. Introduction 19
2. Corporate governance chart 19
3. Board of Directors 19
4. Committees of the Board of Directors 22
4.1. Audit Committee 22
4.2. Appointment and Remuneration Committee 22
5. Remunerations 23
6. Shareholding status 23
7. Financial calendar 24
8. External audit 24
9. Corporate, social and environmental responsibility 24
10. Other information 24
Statement of compliance 25
Consolidated management report 26
Auditor’s report on the consolidated financial statements 30
Consolidated financial statements 35
1. Consolidated statement of financial position 35
2. Consolidated income statement 37
3. Consolidated statement of comprehensive income 38
4. Consolidated statement of cash flows 39
5. Consolidated statement of changes in equity 40
6. Notes to the consolidated financial statements 41
Note 1. Overview and accounting policies 41
Note 2. Subsidiaries and associates 52
Note 3. Goodwill 55
Note 4. Leases 55
Note 5. Intangible assets 57
Note 6. Property, plant and equipment 58
Note 7. Biological assets 59
Note 8. Depreciation and impairment 60
Note 9. Impairment of assets 60
Note 10. Investment properties 62
Note 11. Non-wholly owned subsidiaries in which non-controlling interests are significant 63
Note 12. Financial assets at fair value through other comprehensive income 66
Note 13. Deferred taxes 67
Note 14. Current tax assets and liabilities 68
Note 15. Income tax expense 69
Table of contents
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Note 16. Inventories 71
Note 17. Trade receivables (current assets) 72
Note 18. Other receivables (current assets) 72
Note 19. Cash and cash equivalents 73
Note 20. Share capital and share premium 73
Note 21. Legal reserve 73
Note 22. Pension obligations 74
Note 23. Financial debts 77
Note 24. Trade and other payables 81
Note 25. Financial Instruments 82
Note 26. Staff costs and average number of staff 84
Note 27. Other financial income 84
Note 28. Financial expenses 85
Note 29. Net earnings per share 85
Note 30. Dividends and directors’ fees 85
Note 31. Information on related party 86
Note 32. Off balance sheet commitments 87
Note 33. Segment information 87
Note 34. Risk management 95
Note 35. Contingent liabilities 98
Note 36. Political and economic environment 100
Note 37. Events after the closing date 100
Note 38. Auditor’s fees 101
Company’s Management Report 102
Audit report on the Company’s financial statements 108
1. Balance sheet at 31
st
December 2022 112
2. Income statement for the year ended 31
st
December 2022 114
3. Notes to the financial statements for the year 2022 115
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Socfin
Portrait du GroupeGroup profile
1. Overview of the Group
“Socfin” is a Luxembourg company (the “Company”),
with registered office at 4 avenue Guillaume, L-1650
Luxembourg. It was incorporated on 5
th
December
1959 and is listed on the Luxembourg Stock Exchange.
The principal activity of Socfin is to manage a portfolio
of shares mainly focused on the exploitation of more
than 191,000 hectares of tropical palm oil plantations
and rubber trees located in Africa and South-East
consolidated revenue of EUR 992 million in 2022.
2. History
• 05/12/1959 Constitution of the Société Financière Luxembourgeoise S.A., abbreviated as “Socfinal” in the
form of a holding company.
• 09/06/1960 The Socfinal shares have been listed on the Luxembourg Stock Exchange.
• 31/12/1960 Since its formation, Socfinal has invested, among others, in: Société Financière des Caoutchoucs
“Socfin” (Belgium); Plantations Nord-Sumatra (Belgium); Selangor Plantations Company Berhad
(Malaysia); Sennah Rubber Company Ltd (England) and various companies of Congolese equatorial
cultures.
• 31/12/1965 The portfolio includes new investments in Indonesia: Société de Cultures Asahan; Société de
Cultures Batangara; Huileries de Deli and Société de Cultures Sungei Liput.
• 31/12/1971 Socfinal invests in the Compagnie Internationale de Cultures “Intercultures”, a Luxembourg
company listed on the Luxembourg Stock Exchange; Socfin Industrial Development “Socfinde”
(Luxembourg) and in Compagnie du Cambodge (France).
• 31/12/1972 Socfinal participates in the formation of Socfinasia (Luxembourg) in exchange for the shares of
Indonesian companies Asahan, Batangara, Huileries de Deli and Sungei Liput. Socfinasia will be
listed on the Luxembourg Stock Exchange in 1973.
• 31/12/1975 Disposal of Socfin (Belgium) shares from the portfolio.
• 31/12/1980 Acquisition of Selangor Holding shares, a Luxembourg company listed on the Luxembourg Stock
Exchange.
• 31/12/1994 Socfinal invests 60% in the capital of SOGB (Côte d’Ivoire) following the privatisation of this Ivorian
plantation. This participation will be transferred to Intercultures.
• 31/12/1999 Sale of holdings Selangor Holding and Plantations Nord-Sumatra.
• 31/12/2000 Sale of Sennah Rubber Company shares following the public tender on these shares.
• 15/11/2006 Following the distribution of Intercultures shares by Socfinasia (spin-off), Socfinal directly holds,
on one side Socfinasia (Asia) and on the other Intercultures (Africa).
• 10/01/2011 Extraordinary General Meeting which ratified abandon of the holding 29 status and the change of
the name to Société Financière des Caoutchoucs, abbreviated “Socfin”. Change of the name of
Intercultures to Socfinaf.
• 01/07/2011 Share split by 20.
• 29/08/2014 Socfin exchanged 9% of Socfinaf shares against 100% of the shares of the company incorporated
under French law, Société Anonyme Forestière et Agricole SAFA. The latter owns 68.93% of
Safacam, a Cameroon plantation company that exploits 5,400 hectares of palm oil trees and 4,400
hectares of rubber trees. Following this exchange, Socfin still holds 55.08% of Socfinaf.
• 31/12/2014 The SAFA participation was brought to Socfinaf through a capital increase by contribution in kind.
Socfin holds 56.48% of the capital of Socfinasia and 58.79% of the capital of Socfinaf.
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Group profile
3. Group structure
PNS LTD
Luxembourg
PNS LTD
Luxembourg
65% 58%
30%
35%
50%
50%
50% 50%
50% 50%
33%
48%
100%
15%
15%
50%
50%
93%
87%
100%
100%
100%
SOCFINAF
Luxembourg
SOCFINAF
Luxembourg
10%
19%
SOCFIN
Luxembourg
SOCFIN
Luxembourg
SOCFINASIA
Luxembourg
SOCFINASIA
Luxembourg
100%
SOCFINDE
Luxembourg
SOCFINDE
Luxembourg
20% 80%
50%
10%
50%
50%
35%
30%
50%
100%90%
35%
65%
BEREBY-
FINANCES
Côte d’Ivoire
BEREBY-
FINANCES
Côte d’Ivoire
73%70%
100%
66%
100%
STP INVEST
Belgique
STP INVEST
Belgique
100%
SAFA
France
SAFA
France
100%
88% 69%
100%
100%
100%
50%
50%
Holding companiesHolding companies
67%
Group profile
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Socfin
4. Information on the holdings of Socfin
Portfolio Number of shares Direct %
1) Listed shares
Luxembourg
Socfinasia
11,413,822 58.25%
Socfinaf
11,528,898 64.64%
2) Non-listed shares
Luxembourg
Terrasia 1,891 18.91%
Induservices 3,500 35.00%
Management Associates 3,000 30.00%
The following pages contain a summary of the activity
and comments on the financial information for the
past two financial years of the main companies in
which Socfin holds a direct or indirect participation.
Unless indicated otherwise, equity includes capital,
reserves and the results brought forward before
allocation of current year results.
Corporate data refers to consolidated data.
The balance sheet figures are presented in the
functional currency of the respective entities.
Group profile
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SOCFINASIA
SOCFINASIA is a Luxembourg entity which holds stakes
in companies that operate directly or indirectly in
South-East Asia in the rubber and palm-oil sectors.
Share capital: EUR 24,492,825.
The profit for the year ended 31
st
December 2022
amounts to EUR 70,684,907. The Board of Directors
will propose to the Annual General Meeting on 30
th
May
2023 the payment of a dividend of EUR 3.50 per share,
out of which EUR 2.00 per share has already been
paid at the end of 2022 as an interim dividend for the
financial year 2022.
Key figures (thousands of EUR)
At 31
st
December 2022 2021
Fixed assets
405,668 410,467
Current assets
52,029 41,424
Equity (*)
452,144 446,774
Borrowings, provisions and third parties
5,552 5,117
Profit / (loss) for the period
70,685 45,000
Distribution
76,200 30,480
Share price (EUR)
14.80 14.30
Dividend per share (EUR)
3.50 1.40
Dividend / market capitalisation (%)
23.65 9.79
Socfin's stake (%)
58.25 58.09
(*) Before profit allocation but after interim dividend.
Group profile
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Socfin
SOCFINAF
SOCFINAF is a Luxembourg entity holding stakes
in companies that operate directly or indirectly in
tropical Africa, mainly in the rubber and palm oil
sectors.
Share Capital: EUR 35,673,300.
The loss for the year ended 31
st
December 2022
amounts to EUR 37,542,749. The Board of Directors
will propose to the Annual General Meeting on 30
th
May
2023 not to pay any dividend for the financial year
2022.
Key figures (thousands of EUR)
At 31
st
December 2022 2021
Fixed assets
361,924 469,324
Current assets
36,676 29,901
Equity
221,254 258,796
Borrowings, provisions and third parties
177,347 240,429
Profit / (loss) for the period
-37,543 6,499
Distribution
0 0
Share price (EUR)
11.80 12.00
Dividend per share (EUR)
0 0
Dividend / market capitalisation (%)
0 0
Socfin's stake (%)
64.64 64.51
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International market for rubber and palm oil
1. Rubber
SGX - NATURAL RUBBER - 5 years +
SGX - NATURAL RUBBER - 1 year +
50
100
150
200
250
300
50
100
150
200
250
300
$ct/Kg
RSS3
TSR20
100
120
140
160
180
200
220
240
260
100
120
140
160
180
200
220
240
260
$ct/Kg
RSS3
TSR20
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Sep 2022
Oct 2022
Nov 2022
Dec 2022
Jan 2023
Feb 2023
International market for rubber and palm oil
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The international market in 2022
The average natural rubber price (TSR20 1
st
position on
SGX) for the year 2022 is USD 1,548/T FOB Singapore
compared to USD 1,677/T in 2021, i.e. a decrease of
USD 129/T (-7.7%).
On the other hand, converted into Euro, the average
for the year 2022 is EUR 1,469/T against EUR 1,417/T
for the year 2021, i.e. an increase of 3.7% thanks to a
strengthening of the dollar against the euro.
After their strong increase in 2021 linked to the
global economic recovery, natural rubber prices have
remained sustained with monthly averages above
USD 1,700/T over the first 4 months of 2022.
Russia’s invasion of Ukraine at the end of February
had a positive impact on natural rubber prices, which
moved slightly above USD 1,800/T in the wake of
soaring oil and other commodity prices.
Market sentiment turned bearish from April onwards
as a result of the Chinese government’s “zero Covid”
measures. These measures have severely affected the
economy and mobility, reducing demand from the
world’s largest consumer of natural rubber.
At the same time, European sanctions against Russia,
a major producer of synthetic rubber and tyre
components, have led to production slowdowns in tyre
factories, resulting in a de facto drop in demand for
natural rubber.
In the summer of 2022, the energy crisis in Europe
due to the effects of sanctions against Russia has
had a negative impact on rubber demand for tyre
manufacturers. The level of inflation in Europe and
the US is also a concern for consumers who prefer to
postpone their decision to buy new cars.
The end of 2022 was marked by the request of tyre
manufacturers, faced with a slowdown in production in
their factories and therefore an increase in stocks, to
reduce long-term contracts or to postpone shipments
to the following months.
This slowdown in demand from the tyre industry
has strongly affected natural rubber prices, which
bottomed out at USD 1,151/T in October 2022.
The lifting of restrictions following the end of China’s
“zero Covid” policy in December 2022 allowed natural
rubber prices to recover to around USD 1,400/T at the
end of the year.
The situation in global logistics, which was severely
disrupted in 2021 until the first half of 2022 by the
lack of space on ships, improved significantly in the
last quarter of the year.
In the latest figures published by the International
Rubber Study Group (IRSG) in February 2023, world
natural rubber production in 2022 was 14.57 million
tons, up 5.8% on 2022, while world consumption was
14.31 million tons, up 1.7% on 2021, resulting in a
surplus of 264,000 tons at the end of 2022.
The TSR20 1
st
FOB Singapore position on SGX closed on
30
th
December 2022 at USD 1,302/T.
International market for rubber and palm oil
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Outlook 2023
Natural rubber prices are expected to remain under
pressure amidst conflict on the Ukrainian front,
high global inflation and uncertain developments in
Chinese growth.
Indeed, inflationary pressure from prolonged supply
chain disruptions and high-energy costs will continue
to threaten global economic growth.
At the end of 2022 and this is expected to continue
during the first half of 2023, the slowdown in global
economic activity has had a strong impact on demand
from tyre manufacturers. Faced with a drop in
production in their factories, they have accumulated
significant stocks, forcing them to reduce their
long-term contracts and postpone shipments to the
following months.
The evolution of China’s economic growth in 2023 will
be decisive for prices, which are expected to fluctuate
according to indicators of the industrial health of the
world’s largest natural rubber consumer.
The major uncertainty related to the evolution of
the Russian-Ukrainian crisis is expected to continue
to influence the evolution of rubber prices; the latter
being impacted by the rise in oil and energy prices.
Because of a slowdown in global economic growth
and the arrival on the market of new large capacity
vessels, freight rates have fallen sharply, particularly
from South-East Asian countries, making Asian rubbers
more attractive than in 2021 and 2022, at the expense
of African rubber. Freight rates out of Africa are also
expected to fall, but with a time lag.
For 2023, the IRSG estimates world production at
14.74 million tons (up 1.1%) and world demand at
14.61 million tons (up 2.1%), resulting in a rubber
surplus of 129,000 tons, which would be half the
surplus in 2022.
Rubber consumption would therefore be lower than
production, supported by an expansion of volumes in
several countries such as Côte d’Ivoire, Cambodia,
Laos and Burma. By 2022, Côte d’Ivoire would be the
world’s third largest producer with 1.3 million tons,
behind Thailand and Indonesia and ahead of Vietnam.
The TSR20 1
st
position FOB Singapore on SGX quotes on
28
th
February 2023 at USD 1,362/T.
International market for rubber and palm oil
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2. Palm oil
CIF ROTTERDAM - PALM OILS - 5 years +
CIF ROTTERDAM - PALM OILS - 1 year +
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2,200
2,400
2,600
2,800
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2,200
2,400
2,600
2,800
$/Mton
CPO
CPKO
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2,200
2,400
2,6002,600
2,800
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2,200
2,400
2,800
$/Mton
CPO
CPKO
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Sep 2022
Oct 2022
Nov 2022
Dec 2022
Jan 2023
Feb 2023
International market for rubber and palm oil
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World palm oil production in million tons
(source: Oil World)
2023 (*) 2022 2021 2020 2019 2018 2017 2015 2005 1995
Indonesia
47.9 46.5 44.7 42.8 44.2 41.6 36.8 33.4 14.1 4.2
Malaysia
18.7 18.3 18.1 19.1 19.9 19.5 19.9 20.0 15.0 7.8
Other
14.2 13.8 13.1 12.2 12.4 11.9 11.2 9.1 4.8 3.2
TOTAL
80.8 78.6 75.9 74.1 76.5 73.0 67.9 62.5 33.9 15.2
(*) Estimated (December 2022).
Production of the main oils in million tons
(source: Oil World)
Oct 2022 to Sep 2023 (*) 2022 2021 2020 2019 2018 2017 2015 2005 1995
Palm
80.3 78.6 75.9 74.1 76.5 73.0 67.9 62.5 33.9 15.2
Soya
61.2 59.8 60.1 58.6 56.8 56.8 53.9 48.8 33.6 20.2
Rape
28.7 26.6 26.9 25.3 24.9 25.6 25.4 26.3 16.2 10.8
Sunflower
20.9 20.1 18.9 21.3 20.7 19.0 19.0 15.1 9.7 8.7
Palm kernel
8.4 8.2 8.0 7.8 8.1 7.7 7.2 6.8 4.0 2.0
Cotton
4.5 4.4 4.4 4.6 4.6 4.7 4.2 4.7 5.0 3.9
Peanut
4.7 4.7 4.4 4.2 3.7 4.0 4.2 3.7 4.5 4.3
Copra
2.9 3.1 2.8 2.6 2.9 2.9 2.4 2.9 3.2 3.3
TOTAL
211.6 205.5 201.4 198.5 198.2 193.7 184.2 170.8 110.1 68.4
(*) Estimated (December 2022).
The international market in 2022
The average price for CIF Rotterdam crude palm oil
in 2022 is USD 1,352/T compared to USD 1,195/T in
2021.
The year 2021 was marked by an almost uninterrupted
rise in palm oil prices due to a much lower than
expected supply. This contraction in supply, combined
with a massive return in demand following the end of
the containment measures, led to a very significant
rise in palm oil prices in 2021.
This price increase continued into 2022. Indeed, the
uncertainties regarding the global supply of vegetable
oils were further accentuated during the first quarter.
Firstly, in Malaysia, where the effects of the plan
to accelerate the return of foreign workers to the
plantations were slow to be felt. Then in Indonesia,
which, worried about its domestic market, decided
to restrict its palm oil exports at the end of January
while global demand continued to rise.
At the end of February, the Russian-Ukrainian conflict
put the vegetable oil market on edge. Ukraine
alone traditionally supplied over 50% of the world’s
sunflower oil production. Buyers were forced to turn
to alternative vegetable oils (soya, palm, rapeseed,
etc.) whose prices soared. At the beginning of March,
the CIF Rotterdam CPO broke through the historic
USD 2,000/T threshold, i.e. an increase of almost 50%
since the beginning of the year.
In April 2022, tensions rose again with Indonesia’s
decision to suspend palm oil exports in an already
tight market.
The rationing of the overall supply of vegetable oils in
a context where demand remained strong contributed
to maintaining high price levels throughout most of
the first half. The surge in oil prices, with a barrel of
oil breaking the USD 120 mark on several occasions,
also helped to support palm oil prices during this
period.
International market for rubber and palm oil
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The price surge ended in May with the easing of export
restrictions in Indonesia. The level of palm oil stocks
in the country was then close to 9 million tons. The
world’s largest producer therefore had no choice
but to supply the international market by massively
opening the floodgates for exports, thus creating
strong downward pressure on prices.
The loosening of the grip on sunflower seed exports
from the Black Sea has also helped to alleviate
concerns about the overall supply of vegetable oils.
Prices thus fell back below the USD 1,000/T mark in
September.
During the last quarter of 2022, despite abundant
supply and high stock levels, palm oil prices held up
well thanks to continued strong demand, particularly
in Asia. At the end of December 2022, the CIF
Rotterdam CPO was trading at around USD 1,030/T.
Outlook 2023
After an unprecedented decline at the height of the
Covid pandemic in 2020, palm oil production increased
in 2021 and 2022. The increase is expected to continue
in 2023 with production expected to exceed 80 million
tons.
However, several uncertainties weigh on palm oil
production. Malaysia, the world’s second largest
producer, is facing a structural labour problem that
could negatively impact its production figures. In
addition, soaring fertiliser prices could lead growers
to restrict their use, which would limit the expected
increase in yields.
Indonesia, for its part, is increasing the number of
announcements aimed at limiting the volumes of palm
oil exported in order to satisfy its domestic market
first. Palm oil consumption for the Indonesian biodiesel
industry is also expected to increase as the country
plans to move from the B30 mandate to the B35
mandate (i.e. 35% palm oil in biodiesel composition).
The area harvested for soybeans for the 2023 marketing
year is expected to increase, and production forecasts
for other oilseeds (rapeseed, sunflower, etc.) are
also favourable, suggesting an abundant supply of
vegetable oils on the markets in 2023.
Against the backdrop of the global economic
slowdown, demand could show signs of weakening
even though the main importing countries, led by
India and China, are not expected to see a significant
drop in consumption. In addition, demand should also
be supported by the biofuel industry, thus preventing
prices from falling too sharply.
The evolution of oil prices, the purchasing policies
of importing countries, the implementation of tax
incentives or customs barriers, will also play a
determining role in the evolution of palm oil prices.
On 28
th
February 2023, the CIF Rotterdam CPO quotes
at around USD 1,005/T.
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Environment and social responsibility
The responsible management policy is based on the
Group’s three pillars of commitment, alongside
its specific commitment to transparency: rural
development, workers and local communities, and
environment. These commitments form the basis of
key initiatives aimed at improving long-term economic
performance, social well-being, health, safety and
natural resource management.
An implementation plan for this policy has been
defined and implemented throughout 2022.
The efforts and actions undertaken by the Socfin
Group in this area are detailed in a regularly updated
dashboard as well as in a separate annual report
(“Sustainable Development Report”).
The responsible management policy, the dashboard
and the annual sustainable development report are
available on the Group’s website.
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Socfin
1. Activity Indicators
Area (hectares) Rubber Palm
At 31
st
December 2022
Immatures (by year of planting)
2022
559 2,478
2021
1,055 2,766
2020
1,490 2,324
2019
1,580 0
2018
2,010 0
2017
2,190 0
2016
606 0
2015
757 0
2014
952 0
2013
204 0
2012
9 0
2011
139 0
2010
33 0
Total immatures
11,584 7,568
Young (from 8 to 11 years)
15,913 (from 4 to 7 years) 27,116
Prime (from 12 to 22 years)
24,593 (from 8 to 18 years) 53,240
Old (above 22 years)
8,710 (above 18 years) 42,314
Total in production
49,216 122,671
TOTAL
60,800 130,239
Area (hectares) 2022 2021 2020 2019 2018
Palm
130,239 130,093 129,934 129,667 130,575
Rubber
60,800 61,826 62,560 63,190 63,726
TOTAL
191,039 191,919 192,494 192,857 194,301
Production 2022 2021 2020 2019 2018
Palm Oil (tons)
529,160 536,508 503,926 468,441 456,781
Own production
488,060 489,733 468,303 434,013 426,227
Third party purchases
41,100 46,775 35,623 34,428 30,554
Rubber (tons)
160,185 167,278 160,411 162,975 144,845
Own production
71,941 70,880 64,082 68,873 62,895
Third party purchases
88,243 96,397 96,329 94,102 81,950
Seeds (thousands)
Own production
17,683 15,030 9,454 6,308 14,875
Key figures
Key figures
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Turnover (EUR million)
2022 2021 2020 2019 2018
Palm
583 471 347 309 306
Rubber
269 234 183 200 163
Other agricultural products
9 6 4 4 9
Trading activities
119 119 64 72 56
Other
11 8 7 7 7
TOTAL
992 838 605 592 541
Staff 2022 2021 2020 2019 2018
Average workforce
35,226 34,945 33,834 34,916 33,780
2. Key figures in the consolidated income statement
(EUR million)
2022
2021
2020 2019 2018
Turnover
992 838 605 592 541
Operating income
259 235 92 81 91
Profit / (loss) for the period attributable to the Group
76 80 6 9 17
EBITDA (*)
355 294 172 152 153
Net cash flows from operating activities
283 252 141 93 87
Free cash flow (**)
209 179 59 -20 -20
(*) EBITDA = Earnings before interest, taxes, depreciation and amortisation.
(**) Free Cash Flow = Cash flow from operating activities + cash flow from investing activities.
3. Key figures in the consolidated statement of financial position
(EUR million)
2022
2021
2020 2019 2018
Bearer biological assets
438 479 468 520 512
Other non-current assets
379 370 339 361 356
Current assets
374 329 224 227 209
Total equity
809 737 576 640 642
Non-current liabilities
126 212 136 237 171
Current liabilities
256 228 319 229 263
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ANNUAL REPORT 2022
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Socfin
Stock market data
(EUR)
2022 2021 2020 2019 2018
Number of shares
14,159,720 14,159,720 14,159,720 14,159,720 14,159,720
Equity attributable to the owners of the
Company
431,235,365 380,256,719 284,874,406 317,582,175 304,236,433
Undiluted net profit per share
5.34 5.68 0.33 0.64 0.98
Dividend per share
1.25 0.60 0.00 0.55 0.55
Share price
Minimum
19.20 18.60 18.20 23.20 23.80
Maximum
24.40 24.00 27.00 29.00 30.40
Closing
20.20 20.80 23.20 26.60 28.00
Market capitalisation (*)
286,026,344 294,522,176 328,505,504 376,648,552 396,472,160
Dividend paid / net profit attributable to the
owners of the Company
23.41% 10.56% N/A 85.94% 56.12%
Dividends / market capitalisation
6.19% 2.88% N/A 2.07% 1.96%
Market price / undiluted net profit per share
3.78 3.66 70.30 41.56 28.57
(*) Market capitalisation is the product of the number of shares multiplied by the closing market price.
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Corporate governance statement
1. Introduction
Socfin pays close attention to the evolution of the ten
principles of corporate governance of the Luxembourg
Stock Exchange. It commits to provide the necessary
explanations for a comprehensive understanding on
how the Company functions.
Corporate governance is a set of principles and
rules whose main objective is to contribute to long-
term value creation. It allows the Board to promote
the interests of the Company and its shareholders
while putting in place effective control systems,
management of risks and conflicts of interests.
2. Corporate governance chart
The Board of Directors adopted the corporate
governance chart on 21
st
November 2018. It has been
updated on 29
th
March 2023 and is available on the
Group’s website.
3. Board of Directors
Composition of the Board of Directors
Name Nationality
Year of
Birth
Position
First
nomination
Term of Office
Mr. Hubert Fabri Belgian 1952 Chairman
(a)
AGO 1981 AGO 2027
Mr. Vincent Bolloré French 1952 Director
(a)
AGE 1990 AGO 2025
Mr. Cyrille Bolloré French 1985 Director
(a)
AGO 2022 AGO 2028
Mr. François Fabri Belgian 1984 Director
(b)
AGO 2014 AGO 2026
Mr. Philippe Fabri Belgian 1988 Executive Director
(b)
AGO 2020 AGO 2026
(a) Non-Executive Dependent Director
(b) Executive Dependent Director
The mandate of Mr. Vincent Bolloré, outgoing Director,
is eligible for re-election. The Board will propose to
the next General Meeting the renewal of this term
of office for a period of six years expiring during the
General Meeting of 2029.
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Corporate governance statement
Other mandates held by the directors in listed companies
Hubert Fabri
Chairman
Positions and offices held in Luxembourg companies
• Chairman and director of the Board of Directors of Société Financière des Caoutchoucs ˝Socfin˝, Socfinaf
and Socfinasia.
Positions and offices held in foreign companies
• Chairman and Director of the Board of Directors of Palmeraies de Mopoli;
• Vice-Chairman of Société des Caoutchoucs du Grand Bereby “SOGB”;
• Vice-Chairman and member of the Supervisory Board of Compagnie du Cambodge;
• Director of Compagnie de l’Odet, Financière Moncey, Okomu Oil Palm Company, S.A.F.A. Cameroon
“Safacam”, Société Industrielle et Financière de l’Artois and La Forestière Equatoriale;
• Permanent representative of Administration and Finance Corporation “AFICO” at the Board of Société
Camerounaise de Palmeraies “Socapalm”.
Vincent Bolloré
Director
Positions and offices held in Luxembourg companies
• Director of Société Financière des Caoutchoucs ˝Socfin˝, Socfinaf and Socfinasia.
Positions and offices held in foreign companies
• Chairman and Chief Executive Officer of Compagnie de l’Odet;
• Vice-Chairman of Société des Caoutchoucs du Grand Bereby “SOGB”;
• Director of Compagnie de l’Odet;
• Permanent representative of Bolloré Participations SE on the Boards of Directors of S.A.F.A. Cameroon
“Safacam”, Société des Caoutchoucs du Grand Bereby “SOGB” and Société Camerounaise de Palmeraies
“Socapalm”.
Cyrille Bolloré
Director
Positions and offices held in Luxembourg companies
• Director of Société Financière des Caoutchoucs ˝Socfin˝ and Socfinasia;
• Permanent representative of Bolloré Participations SE on the Board of Directors of Socfinaf.
Positions and offices held in foreign companies
• Chairman and Chief Executive Officer of the Board of Directors of Bolloré SE;
• Member of the Supervisory Board of Compagnie du Cambodge;
• Vice-Chairman of Compagnie de l’Odet;
• Director of Bolloré SE, Compagnie de l’Odet and Société Industrielle et Financière de l’Artois;
• Permanent representative of Compagnie du Cambodge on the Board of Financière Moncey;
• Member of the Supervisory Board of Vivendi SE;
• Non-Executive Director and member of the Compensation Committee of UMG N.V.
Corporate governance statement
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François Fabri
Director
Positions and offices held in Luxembourg companies
• Director of Société Financière des Caoutchoucs “Socfin”, Socfinaf and Socfinasia;
• Executive Director of Socfinaf.
Positions and offices held in foreign companies
• Permanent Representative of Administration and Finance Corporation “AFICO” on the Board of Société des
Caoutchoucs du Grand Bereby “SOGB” and Société Industrielle et Financière de l’Artois;
• Managing Director of Palmeraies de Mopoli;
• Director of S.A.F.A. Cameroon “Safacam” and Société Camerounaise de Palmeraies “Socapalm”.
Philippe Fabri
Executive Director
Positions and offices held in Luxembourg companies
• Director of Société Financière des Caoutchoucs “Socfin”, Socfinaf and Socfinasia;
• Executive Director of Société Financière des Caoutchoucs “Socfin”.
Positions and offices held in foreign companies
• Member of the Supervisory Board of Palmeraies de Mopoli;
• Permanent representative of Société Anonyme Forestière et Agricole “SAFA” on the board of S.A.F.A.
Cameroon “Safacam”.
Appointments of Directors
The Board of Directors proposes the appointment
of the Directors at the Annual General Meeting of
shareholders.
In the event of a vacancy due to death or following the
resignation of one or more Directors, the remaining
Directors will proceed to temporary co-optations.
These co-optations will be subject to the approval of
the Annual General Meeting at its next meeting. The
Director appointed to replace another Director will
complete the term of his predecessor.
Role and powers of the Board of Directors
The Board of Directors is the body responsible for
the management of the Company and the control of
day-to-day management. It acts in the interest of the
Company.
The Board of Directors ensures that all financial and
human resources are available and ensures that all
the necessary structures are in place to achieve its
objectives and ensure long-term value creation.
The Articles of Association empower the Board of
Directors to perform all actions necessary to achieve
the corporate purpose.
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Corporate governance statement
Activity report of the Board of Directors
Number of meetings
At least two for the end and mid-year evaluations.
During the 2022 financial year, the Board of Directors
met 5 times.
Topics generally discussed
Periodic accounting situations;
Portfolio movements;
Inventory and valuation of the portfolio;
Evolution of significant holdings;
Management report;
Investment projects;
Corporate, social and environmental responsibility.
Average attendance rate of Directors
- 2022: 92%
- 2021: 93%
- 2020: 92%
- 2019: 92%
- 2018: 97%
4. Committees of the Board of Directors
4.1. Audit Committee
The Committee is composed of three members, of
which 2 are independents and one of them assigned
as President of the Audit Committee. The members of
the Audit Committee are appointed for one year and
are eligible for re-election. This Audit Committee is
effective as of 1
st
January 2023 and has been in charge
of the supervision of the preparation of the financial
information for the year 2022.
The Board of Directors has proposed that it will be
constituted as follows:
9 Mrs. Valérie Hortefeux (Independent Member) -
Chairperson
9 Mr. Frédéric Lemaire (Independent Member)
9 Mr. Philippe Fabri (Director)
The appointment of the non-executive members will
be confirmed at the General Meeting of Shareholders
on 30
th
May 2023.
The Audit Committee will assist the Board of Directors
in its supervisory function and is responsible of the
monitoring of the financial reporting, the audit
process, the analysis and control of financial risks.
The Audit Committee shall meet three times a year.
4.2. Appointment and Remuneration Committee
The remuneration of the operational management of
Socfin is set by the principal shareholders. The Board
of Directors does not consider it necessary to set up
a Remuneration Committee. Similarly, for practical
reasons and due to the size of the Company, the Board
of Directors has chosen not to set up a Nomination
Committee.
Corporate governance statement
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5. Remunerations
The remuneration allocated to the members of
the Board of Directors of Socfin for the financial
year 2022 amounts to EUR 18,071,177 compared
to EUR 7,864,842 for the financial year 2021. The
Directors of Socfin did not receive any other payment
in shares (stock options).
6. Shareholding status
Shareholder
Number of shares held =
Number of voting rights (*)
Percentage holding Date of notification
Hubert Fabri 5,083,420 35.90 04/11/2022
AFICO S.A.
L-1650 Luxembourg 2,758,368 19.48 04/11/2022
Total Hubert Fabri
(direct and indirect) 7,841,788 55.38
Bolloré Participations SE
F-29500 Ergué Gaberic 1,000 0.01 29/10/2021
Bolloré SE
F-29500 Ergué Gaberic 2,110,698 14.91 29/10/2021
Compagnie du Cambodge
F-92800 Puteaux 1,747,220 12.34 29/10/2021
Technifin
CH-1705 Fribourg 1,416,062 10.00 29/10/2021
Plantations des Terres Rouges
L-1724 Luxembourg 268,080 1.89 29/10/2021
Compagnie des Glénans
F-29500 Ergué Gaberic 80,000 0.56 29/10/2021
Compagnie de l’Odet
F-29500 Ergué Gaberic 5,534 0.04 29/10/2021
Total Bolloré Participations SE
(direct and indirect) 5,628,594 39.75
Corporate governance statement
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7. Financial calendar
30
th
May 2023 Annual General Meeting at noon
8
th
June 2023 Payment of the balance of dividend for 2022 (coupon number 82)
End of September 2023 Half year stand alone and consolidated results at 30
th
June 2023
Mid-November 2023 Interim Management statement for 3
rd
quarter of 2023
End of March 2024 Annual stand alone results at 31
st
December 2023
Mid-April 2024 Consolidated annual results at 31
st
December 2023
Mid-May 2024 Interim Management statement for the 1
st
quarter of 2024
28
th
May 2024 Annual General Meeting at noon
The results of the Company are published on the website of the Luxembourg Stock Exchange www.bourse.lu and
on the website of the Company www.socfin.com.
8. External audit
Independent statutory auditor
(Réviseur d’entreprises agréé)
Ernst & Young “EY”
35E Avenue John F. Kennedy
L-1855 Luxembourg.
In 2022, the audit fees amount to EUR 1,509,211 VAT
included.
The audit fees include all fees paid to the independent
statutory auditor of the Group, as well as those paid
to member firms within their network for the year. No
consulting work or other non-audit services have been
performed by those companies in 2022.
9. Corporate, social and environmental responsibility
The responsible management policy is based on the
Group’s three pillars of commitment, alongside
its specific commitment to transparency: rural
development, workers and local communities, and
environment. These commitments form the basis of
key initiatives aimed at improving long-term economic
performance, social well-being, health, safety and
natural resource management.
An implementation plan for this policy has been
defined and implemented throughout 2022.
The efforts and actions undertaken by the Socfin
Group in this area are detailed in a regularly updated
dashboard as well as in a separate annual report
(“Sustainable Development Report”).
The responsible management policy, the dashboard
and the annual sustainable development report are
available on the Group’s website.
10. Other information
Pursuant to the Regulation 2016/347 of the European
Commission of 10
th
March 2016 specifying the
modalities for updating insider lists, a list of insiders
has been drawn up and is updated continuously.
The persons concerned have been informed of their
inclusion on this list.
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Statement of compliance
Mr. Philippe Fabri, Director and Mr. Daniel Haas, Chief Financial Officer, indicate that, to their knowledge:
(a) the consolidated financial statements prepared for the year ended at 31
st
December 2022, in accordance
with the international accounting standards adopted by the European Union, provide a true and fair view of
the assets and liabilities, the financial position and the profits or losses attributable to Socfin and all of the
entities included in consolidation; and
(b) the management report fairly presents the evolution and results of the Company, the financial position of the
Group and all the entities included in the consolidation and a description of the main risks and uncertainties
they face.
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Consolidated management report
Directors’ report on the consolidated financial statements
presented by the Board of Directors to the
Annual General Meeting of the Shareholders of 30
th
May 2023
Ladies and Gentlemen,
1. CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements at 31
st
December
2022 include the financial statements of Socfin, all
subsidiaries and direct and indirect associate companies,
the details of which are given in Note 2 of the notes to
the consolidated financial statements.
As stated in Note 1 of the notes to the consolidated
financial statements, the consolidated financial
statements have been prepared in accordance with
International Financial Reporting Standards or IFRS as
adopted by the European Union. Socfin (the Group)
adopted IFRS standards for the first time in 2005 and all
the standards applicable to the Group at 31
st
December
2022 have been implemented.
Consolidated results
For the 2022 financial year, the result attributable
to the Group of the parent company amounted to
EUR 75.6 million compared to EUR 80.4 million in
2021. This resulted in net earnings of EUR 5.34 per
share against EUR 5.68 in 2021.
Consolidated revenue at 31
st
December 2022 amounted
to EUR 991.5 million compared to EUR 837.6 million in
2021 (EUR +153.9 million). This change in revenue is
mainly due to increase in the price (EUR +114.0 million)
and variation of transactional currency versus Euro
(EUR +45.0 million).
Operating profit amounted to EUR 259.3 million
compared to EUR 235.3 million at 31
st
December
2021. The fixed assets were subject to a non-recurring
impairment of EUR 27.3 million in 2022.
Other financial income increased to EUR 39.2 million
compared to EUR 11.6 million at 31
st
December 2021.
They mainly consisted of foreign exchange gains of
EUR 37.0 million.
Financial expenses amounted to EUR 56.5 million
compared to EUR 22.9 million at 31
st
December
2021. They mainly consist of foreign exchange
losses of EUR 42.8 million and interest on loans of
EUR 10.6 million.
The tax expense has increased. Income taxes amounted
to EUR 71.3 million compared to EUR 53.5 million
in 2021. Deferred income tax amounted to
EUR -4.9 million compared to EUR -0.8 million in 2021.
Consolidated statement of financial position
The assets of Socfin consist of:
- non-current assets of EUR 817.0 million compared
to EUR 848.4 million at 31
st
December 2021; a
decrease of EUR -31.3 million mainly due to the
decrease of the non current biological assets for
EUR -40.8 million, the decrease of the deferred
tax assets for EUR -7.7 million, reduced by the
increase in property, plant and equipment of
EUR 16.1 million;
- current assets amounting to EUR 374.2 million
compared with EUR 329.0 million at 31
st
December
2021, mainly due to the increase of the cash and cash
equivalents for EUR 37.0 million and in inventories
for EUR 14.2 million, slightly reduced by the
decrease in trade receivables for EUR -5.2 million.
Shareholders’ equity amounted to EUR 431.2 million
compared to EUR 380.3 million at 31
st
December
2021. The variation in shareholders’ equity of
EUR +51.0 million is mainly due to the profit for the
period (for EUR +75.6 million), the dividend paid during
the period (impact of EUR -17.7 million) and the variation
of translation reserve (impact of EUR -9.0 million).
Consolidated management report
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On the basis of the consolidated shareholders’ equity,
the net value per share before distribution of dividend
is EUR 30.46 against EUR 26.85 the previous year. At
31
st
December 2022, the share price stands at EUR 20.20.
Current and non-current liabilities decreased to
EUR 382.2 million compared to EUR 440.5 million the
previous year. The difference is mainly due to the
decrease for EUR 65.7 million in net borrowings, the
increase for EUR 8.9 million in trade payables and for
EUR 8.5 million in the current tax liabilities.
Consolidated cash flow
At 31
st
December 2022, cash and cash equivalents
amount to EUR 167.9 million, an increase of
EUR 30.6 million for the year (compared to an increase
of EUR 83.1 million in the previous financial year).
Net cash flows from operating activities amount
to EUR 282.7 million for the 2022 financial year
(EUR 251.6 million in 2021) and cash flows from
operations amount to EUR 329.9 million compared to
EUR 278.0 million in the previous financial year.
Cash flows from investing activities amount to
EUR -73.3 million (compared to EUR -73.1 million in
2021).
Cash flows from financing activities amount to
EUR -179.4 million (compared to EUR -98.3 million
in 2021). They relate primarily to the payment of
dividends of EUR -83.8 million and to the decrease in
net borrowings for EUR -82.4 million.
2. FINANCIAL INSTRUMENTS
Financial risk management policies are described in the
notes to the consolidated financial statements of the
Company (refer to Notes 25 and 34).
3. OUTLOOK 2023
The results for the next financial year will depend,
to a large extent, on factors which are external to
the Group management, namely the political and
economic conditions in the countries where the
subsidiaries are established, the changes in the price
of rubber and palm oil, and the price of the Indonesian
rupiah and the US dollar against the Euro. The Group,
for its part, pursues its policy of keeping cost prices as
low as possible and improving its production capacity.
4. POLITICAL AND ECONOMIC ENVIRONMENT
The Company holds interests in subsidiaries which
operate indirectly in Africa and South-East Asia.
Given the economic and political instability in some of
these countries, these holdings present a risk in terms
of exposure to political and economic changes.
Russia Ukrain conflict
In February 2022, a number of countries (including
the US, UK and EU) imposed sanctions against certain
entities and individuals in Russia as a result of the
official recognition of the Donetsk People Republic and
Lugansk People Republic by the Russian Federation.
Announcements of potential additional sanctions have
been made following military operations initiated by
Russia against the Ukraine on 24th February 2022.
Due to these geopolitical tensions, there has been a
significant increase in volatility on the securities and
currency markets in 2022, as well as a significant
depreciation of the ruble against the US dollar and
the euro.
Although neither the companys performance and
going concern nor operations, have been significantly
impacted by the above during 2022, the Board of
Directors continues to monitor the evolving situation
and its impact on the financial position and results of
the company.
Consolidated management report
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5. EVENTS AFTER THE CLOSING DATE
Early final reimbursement of loan
At 24
th
February 2023 and following an early
prepayment of Socfin’s debt to PNS Ltd, PNS Ltd itself
repaid early the outstanding balance of its bank loan,
amounting to USD 30,000,000.
Following this final repayment, PNS Ltd bank loan is
fully reimbursed, the share pledge and the securities
have been waived.
6. CORPORATE GOVERNANCE
The Board of Directors implements the corporate
governance rules applicable in the Grand Duchy of
Luxembourg in the Group’s financial structure and
reports.
Further information on how the rules are implemented
is available in the corporate governance statement in
the annual report and in the management report on
the Company’s stand alone financial statements.
7. GENERAL INTERNAL CONTROL SYSTEM ADAPTED TO THE GROUP’S
SPECIFIC ACTIVITIES
Segregation of functions
The segregation of operational, commercial and
financial functions implemented at each level of
the Group reinforces the independence of internal
control.
These different functions ensure the completeness
and reliability of the information which is within their
areas of responsibility. They provide regular updates
of the completeness of information to local managers
and to the Group’s headquarters (agricultural and
industrial production, trade, human resources,
finance, etc).
Autonomy and accountability of subsidiaries
The operational entities have a large degree of
autonomy in their management due to geographical
distances. They are, in particular, responsible for
the implementation of an internal control system
adapted to the nature and extent of their activity,
the optimisation of their operations and financial
performances, the protection of their assets and
management of their risks.
This autonomy makes it possible for the entities to
be more accountable and to ensure the adequacy
between their practices and the legal framework of
their host country.
Centralised control
The Human Resources Management policy of the
top management of the entities within the Group is
centralised at the Group’s headquarters. It contributes
to the smooth running of an effective internal control
system through the independence of recruitment, the
harmonisation of the segregated functions, annual
evaluations and training programs.
The operational, commercial and financial functions
centrally define a set of standard reports which ensure
the homogeneity of the presentation of information
originating from the subsidiaries.
Treasury reporting process
The treasury department organises, supervises and
controls the reporting of daily information and weekly
indicators of the subsidiaries and, in particular, the
cash flow position, the evolution of net debt and the
expenses related to the investments.
Consolidated management report
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Financial reporting process
The financial department organises, supervises
and controls the reporting of monthly accounting,
budgetary and financial information and distributes
condensed reports for use by the Group’s operational
management.
Twice per year, it includes this information in the long-
term development plan of the subsidiaries. It also
ensures the implementation of the financial decisions
taken by the Board of Directors of the subsidiaries.
Preparation of consolidated accounts
The consolidated financial statements are prepared
on a half-yearly basis. They are audited annually by
the external auditors as part of a financial audit of
subsidiaries, which covers both the statutory accounts
of the entities in the scope of consolidation and the
consolidated financial statements.
Once approved by the Board of Directors, they are
published.
The consolidation department of the Group
guarantees homogeneity and treatment monitoring
for all companies within the scope of consolidation. It
strictly adheres to the accounting standards in force
relating to consolidation operations. It uses a standard
consolidation tool to ensure the secure processing
of information feedback from subsidiaries, the
transparency and relevance of automatic consolidation
processes and the consistency of presentation of
accounting aggregates in the annual report. Lastly,
due to the complexity of the accounting standards
in force and the many specificities related to their
implementation, the consolidation service centralises
the adjustments specific to the valuation rules
applicable to the consolidated financial statements.
8. ENVIRONMENT AND SOCIAL RESPONSIBILITY
The responsible management policy is based on the
Group’s three pillars of commitment, alongside
its specific commitment to transparency: rural
development, workers and local communities, and
environment. These commitments form the basis of
key initiatives aimed at improving long-term economic
performance, social well-being, health, safety and
natural resource management.
An implementation plan for this policy has been
defined and implemented throughout 2022.
The efforts and actions undertaken by the Socfin
Group in this area are detailed in a regularly updated
dashboard as well as in a separate annual report
(“Sustainable Development Report”).
The responsible management policy, the dashboard
and the annual sustainable development report are
available on the Group’s website.
The Board of Directors
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Auditor’s report on the consolidated financial statements
To the Shareholders of
Société Financière des Caoutchoucs S.A.
4, avenue Guillaume
L-1650 Luxembourg
Report on the audit of the consolidated
financial statements
Opinion
We have audited the consolidated financial statements
of Société Financière des Caoutchoucs S.A. and
its subsidiaries (the “Group”), which comprise the
consolidated statement of financial position as at 31
December 2022, and the consolidated statement of
comprehensive income, the consolidated statement
of changes in equity and the consolidated statement
of cash flows for the year then ended, and the notes
to the consolidated financial statements, including a
summary of significant accounting policies.
In our opinion, the accompanying consolidated
financial statements give a true and fair view of the
consolidated financial position of the Group as at
31 December 2022, and of its consolidated financial
performance and consolidated cash flows for the year
then ended in accordance with International Financial
Reporting Standards (“IFRS”) as adopted by the
European Union.
Basis for opinion
We conducted our audit in accordance with EU
Regulation N° 537/2014, the Law of 23 July 2016 on the
audit profession (the “Law of 23 July 2016”) and with
International Standards on Auditing (“ISAs”) as adopted
for Luxembourg by the “Commission de Surveillance
du Secteur Financier” (“CSSF”). Our responsibilities
under the EU Regulation Nº 537/2014, the Law of
23 July 2016 and ISAs are further described in the
“Responsibilities of the “réviseur d’entreprises agréé”
for the audit of the consolidated financial statements”
section of our report. We are also independent of the
Group in accordance with the International Ethics
Standards Board for Accountants’ Code of Ethics for
Professional Accountants (“IESBA Code”) as adopted
for Luxembourg by the CSSF together with the ethical
requirements that are relevant to our audit of the
consolidated financial statements, and have fulfilled
our other ethical responsibilities under those ethical
requirements. We believe that the audit evidence we
have obtained is sufficient and appropriate to provide
a basis for our opinion.
Key audit matters
Key audit matters are those matters that, in our
professional judgment, were of most significance in
our audit of the consolidated financial statements of
the current period. These matters were addressed in
the context of the audit of the consolidated financial
statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on
these matters.
Valuation of biological assets
Risk identified
As at 31 December 2022, the value of the Group’s
biological assets amounted to EUR 438 million out of
total assets of EUR 1,191 million.
The Group owns biological assets in Africa and Asia.
These biological assets, which consist mainly of oil
palm and rubber plantations, are valued in accordance
with the principles defined in IAS 16 «Property, Plant
and Equipment». These assets are recognised at cost
less accumulated depreciation and any impairment
losses.
The note 9 «Impairment of assets» of the consolidated
financial statements describes the methodology used
by Group management to assess whether there is any
indicator of impairment or any indicator of impairment
reversal at the balance sheet date. When an indicator
is identified, Group management determines the
recoverable amount of the biological assets and thus
determines the impairment loss or the reversal of
impairment to be recognised, if any.
Auditor’s report on the consolidated financial statements
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The indicators used by Group Management are:
• a decrease or an increase of the listed price of
natural rubber (TSR20 1st position on SGX) and the
listed price of crude palm oil (CIF Rotterdam) at the
balance sheet date higher than 15% compared to a
five-year average of the prices observed on those
markets
• a decrease or an increase of the six-month average
of the prices observed of those markets higher than
15% compared to a five-year average of the prices
observed on those markets
• a decrease or an increase of the twelve-month
average of the prices observed of those markets of
more than 15% compared to a five-year average of
the prices observed on those markets
For palm oil, which is mainly sold on local markets,
Group Management also analyses local sales prices,
considering that a decrease or an increase in these
prices at the balance sheet date higher than 15%
compared to a five-year average value of the local
prices constitutes an indicator of impairment or an
indicator of impairment reversal respectively.
In addition to these external factors, the Group
analyses the following internal performance
indicators:
- Specificities of the local market (evolution of supply
and demand, ...);
- Physical indications of impairment;
- Significant changes in the plantations that could
have a material impact on future cash flows.
The recoverable amount is determined as the higher
of the value in use and the fair value less costs of
disposal. The value in use is defined in terms of
discounted future net cash flows and involves
significant judgements and estimations by Group
Management, including financial forecasts and the
utilization of appropriate discount rates.
We considered the valuation of biological assets to be
a key audit issue because of :
- their significance in relation to the Group’s total
assets
- the assessment of whether there is any indicator of
impairment or any indicator of impairment reversal;
and
- the determination of their recoverable amount
which involves significant judgements and
estimates.
Audit response
In order to assess the reasonableness of an indicator
of impairment or an indicator of impairment reversal
and, where appropriate, to determine the recoverable
amount of biological assets, we performed the following
audit procedures :
• Assess the compliance of Group’s management’s
methodology with the provisions of IAS 36
«Impairment of Assets»;
• Analyze the methodology used with a particular focus
on the indicators of impairment or on the indicators
of impairment reversal;
• Analyze the completeness of indicators of impairment
or indicators of impairment reversal:
- Evaluating the assessment performed by Group
management to identify the existence of indicators
of impairment or indicators of impairment reversal
by comparing the underlying data of the analysis
with the source of the data used;
- Comparing the evolution of yields per hectare; and
- Overseeing the audit work of the components
auditors of material subsidiaries to identify any
indicators of impairment or any indicators of
impairment reversal, including that site visits of
the plantations have been carried out;
• In case of identification of an indicator of impairment
or an indicator of impairment reversal, we:
- Assess the appropriateness of the methodology
applied by Group Management to determine the
recoverable value of the biological assets and the
accuracy of any impairment loss or any impairment
reversal recorded;
- Analyze the reasonableness of the cash flow
forecasts used by Group Management to determine
the value in use of the biological assets;
- Assess the reasonableness of the assumptions and
inputs used by Group management; and
- Reconcile the key inputs used in the model with
information audited by the components auditors of
material subsidiaries.
• Assess whether the disclosures required by IAS 36
«Impairment of Assets» for biological assets are
properly disclosed in the notes of the consolidated
financial statements.
Auditor’s report on the consolidated financial statements
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Other information
The Board of Directors is responsible for the other
information. The other information comprises the
information included in the consolidated management
report and the corporate governance statement but
does not include the consolidated financial statements
and our report of “réviseur d’entreprises agréé”
thereon.
Our opinion on the consolidated financial statements
does not cover the other information and we do not
express any form of assurance conclusion thereon.
In connection with our audit of the consolidated
financial statements, our responsibility is to read the
other information and, in doing so, consider whether
the other information is materially inconsistent
with the consolidated financial statements or our
knowledge obtained in the audit or otherwise appears
to be materially misstated. If, based on the work we
have performed, we conclude that there is a material
misstatement of this other information, we are
required to report this fact. We have nothing to report
in this regard.
Responsibilities of the Board of Directors and
those in charge of governance for the financial
statements
The Board of Directors is responsible for the preparation
and fair presentation of the consolidated financial
statements in accordance with IFRS as adopted by the
European Union, and for such internal control as the
Board of Directors determines is necessary to enable
the preparation of consolidated financial statements
that are free from material misstatement, whether
due to fraud or error.
The Board of Directors is also responsible for
presenting the consolidated financial statements
in compliance with the requirements set out in the
Delegated Regulation 2019/815 on European Single
Electronic Format, as amended (“ESEF Regulation”).
In preparing the consolidated financial statements,
the Board of Directors is responsible for assessing
the Group’s ability to continue as a going concern,
disclosing, as applicable, matters related to going
concern and using the going concern basis of
accounting unless the Board of Directors either
intends to liquidate the Group or to cease operations,
or has no realistic alternative but to do so.
Those charged with governance are responsible for
overseeing the Group’s financial reporting process.
Responsibilities of the “réviseur d’entreprises
agréé” for the audit of the consolidated
financial statements
The objectives of our audit are to obtain reasonable
assurance about whether the consolidated financial
statements as a whole are free from material
misstatement, whether due to fraud or error, and to
issue a report of the “réviseur d’entreprises agréé”
that includes our opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that
an audit conducted in accordance with EU Regulation
N° 537/2014, the Law of 23 July 2016 and with the
ISAs as adopted for Luxembourg by the CSSF will
always detect a material misstatement when it
exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the
aggregate, they could reasonably be expected to
influence the economic decisions of users taken on
the basis of these consolidated financial statements.
As part of an audit in accordance with EU Regulation
N° 537/2014, the Law of 23 July 2016 and with ISAs
as adopted for Luxembourg by the CSSF, we exercise
professional judgment and maintain professional
skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement
of the consolidated financial statements, whether
due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate
to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from
fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of
internal control.
• Obtain an understanding of internal control relevant
to the audit in order to design audit procedures
that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the
effectiveness of the Group’s internal control.
Auditor’s report on the consolidated financial statements
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• Evaluate the appropriateness of accounting
policies used and the reasonableness of accounting
estimates and related disclosures made by the
Board of Directors.
• Conclude on the appropriateness of Board of
Directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether
a material uncertainty exists related to events or
conditions that may cast significant doubt on the
Group’s ability to continue as a going concern. If
we conclude that a material uncertainty exists,
we are required to draw attention in our report of
the “réviseur d’entreprises agréé” to the related
disclosures in the consolidated financial statements
or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our report of
the “réviseur d’entreprises agréé”. However, future
events or conditions may cause the Group to cease
to continue as a going concern.
• Evaluate the overall presentation, structure and
content of the consolidated financial statements,
including the disclosures, and whether the
consolidated financial statements represent the
underlying transactions and events in a manner that
achieves fair presentation.
• Assess whether the consolidated financial
statements have been prepared, in all material
respects, in compliance with the requirements laid
down in the ESEF Regulation.
• Obtain sufficient appropriate audit evidence
regarding the financial information of the entities
and business activities within the Group to express
an opinion on the consolidated financial statements.
We are responsible for the direction, supervision
and performance of the Group audit. We remain
solely responsible for our audit opinion.
We communicate with those charged with governance
regarding, among other matters, the planned scope
and timing of the audit and significant audit findings,
including any significant deficiencies in internal
control that we identify during our audit.
We also provide those charged with governance with
a statement that we have complied with relevant
ethical requirements regarding independence, and
communicate to them all relationships and other
matters that may reasonably be thought to bear on
our independence, and where applicable, related
safeguards.
From the matters communicated with those charged
with governance, we determine those matters
that were of most significance in the audit of the
consolidated financial statements of the current period
and are therefore the key audit matters. We describe
these matters in our report unless law or regulation
precludes public disclosure about the matter.
Report on other legal and regulatory
requirements
We have been appointed as “réviseur d’entreprises
agréé” by the General Meeting of the Shareholders on
26 May 2020 and the duration of our uninterrupted
engagement, including previous renewals and
reappointments, is 3 years.
The consolidated management report is consistent
with the consolidated financial statements and has
been prepared in accordance with applicable legal
requirements.
The accompanying corporate governance statement
on pages 19 to 24 is the responsibility of the Board
of Directors. The information required by article
68ter paragraph (1) letters c) and d) of the law of
19 December 2002 on the commercial and companies
register and on the accounting records and annual
accounts of undertakings, as amended, is consistent
with the consolidated financial statements and has
been prepared in accordance with applicable legal
requirements.
We have checked the compliance of the consolidated
financial statements of the Group as at 31 December
2022 with relevant statutory requirements set out
in the ESEF Regulation that are applicable to the
financial statements. For the Group, it relates to :
• Financial statements prepared in valid xHTML
format;
• The XBRL markup of the consolidated financial
statements using the core taxonomy and the
common rules on markups specified in the ESEF
Regulation.
In our opinion, the consolidated financial statements
of the Group as at 31 December 2022, identified as
Auditor’s report on the consolidated financial statements
34
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Socfin 2022 Annual report.zip, have been prepared,
in all material respects, in compliance with the
requirements laid down in the ESEF Regulation.
We confirm that the audit opinion is consistent with
the additional report to the audit committee or
equivalent.
We confirm that the prohibited non-audit services
referred to in EU Regulation No 537/2014 were not
provided and that we remained independent of the
Group in conducting the audit.
Luxembourg,
31
March
2023
Anthony CANNELLA
Cabinet de révision agréé
Société anonyme
Ernst & Young
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Consolidated financial statements
1. Consolidated statement of financial position
31/12/2022
31/12/2021
ASSETS Note EUR EUR
Non-Current Assets
Goodwill 3 4,951,057 4,951,057
Right-of-use assets 4 11,902,767 10,505,511
Intangible assets 5 2,594,599 3,705,743
Property, plant and equipment 6 338,771,365 322,679,989
Biological assets 7 438,088,818 478,856,665
Investment properties 10 3,670,084 3,860,781
Financial assets at fair value through other comprehensive income 12 688,024 715,578
Long-term advances 1,978,537 1,858,758
Deferred tax assets 13 11,698,487 19,434,381
Other non-current assets 2,699,565 1,823,792
Current Assets
Inventories 16 128,671,570 114,505,857
Current biological assets 7 4,689,621 3,559,160
Trade receivables 17 36,867,117 42,082,791
Other receivables 18 8,665,133 10,238,140
Current tax assets 14 14,942,449 15,291,971
Cash and cash equivalents 19 180,322,293 143,315,435
TOTAL ASSETS 1,191,201,486 1,177,385,609
The accompanying notes are an integral part of these consolidated financial statements.
Consolidated financial statements
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31/12/2022
31/12/2021
EQUITY AND LIABILITIES Note EUR EUR
Equity attributable to the owners of the Parent
Share capital 20 24,779,510 24,779,510
Share premium 20 501,847 501,847
Legal reserve 21 2,477,951 2,477,951
Consolidated reserves 444,942,847 380,183,421
Translation reserves -117,053,765 -108,075,534
Profit / (loss) for the period 75,586,975 80,389,524
Non-controlling interests
11
Total Equity 809,044,033 736,910,826
Non-Current Liabilities
Deferred tax liabilities 13 14,322,563 16,941,426
Employee benefits obligations 22 47,578,049 51,008,374
Long-term debt, net of current portion 23 47,637,647 125,924,853
Long-term lease liabilities 4 11,087,025 10,977,779
Other payables 24 6,005,421 7,401,153
Current Liabilities
Short-term debt and current portion of long-term debt 23 51,060,969 38,433,365
Short-term lease liabilities
4
Trade payables
24
Current tax liabilities 14 56,820,337 48,328,464
Provisions 666,523 381,506
Other payables 24 91,298,038 94,708,254
TOTAL EQUITY AND LIABILITIES 1,191,201,486 1,177,385,609
The accompanying notes are an integral part of these consolidated financial statements.
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Consolidated financial statements
2. Consolidated income statement
2022
2021
Note EUR EUR
Revenue 33 991,511,407 837,644,569
Work performed by entity and capitalised 10,557,795 13,066,016
Change in inventories of finished products and work in progress -4,795,074 830,651
Other operational income 11,926,344 8,640,023
Raw materials and consumables used
33
-343,091,740 -288,189,236
Other expenses
33
-110,398,857 -97,953,325
Staff costs 26 -172,621,305 -153,346,286
Depreciation and impairment expense 8 -95,876,217 -64,496,770
Other operating expenses
33
-27,875,215 -20,861,972
Operating profit / (loss)
Other financial income 27 39,239,727 11,620,171
Gain on disposals 897,913 202,701
Loss on disposals -2,315,202 -3,313,945
Financial expenses 28 -56,548,682 -22,920,697
Profit / (loss) before taxes 240,610,894 220,921,900
Income tax expense 15 -71,319,742 -53,538,854
Deferred tax (expense) / income 15 -4,936,022 -840,121
Profit / (loss) for the period
Profit / (loss) attributable to non-controlling interests 88,768,155 86,153,402
Profit / (loss) attributable to the owners of the Parent 75,586,975 80,389,523
Basic earnings per share undiluted
29 5.34 5.68
Number of Socfin shares
Basic earnings per share 5.34 5.68
Diluted earnings per share 5.34 5.68
The accompanying notes are an integral part of these consolidated financial statements.
Consolidated financial statements
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Consolidated financial statements
3. Consolidated statement of comprehensive income
2022 2021
Note EUR EUR
Profit / (loss) for the period
Other comprehensive income
Actuarial gains / (losses)
22 3,482,512 1,874,113
Deferred tax on actuarial losses and gains
-617,857 -590,525
Fair value changes of securities measured at fair value through
other comprehensive income, before taxes
12 -27,554 -36,378
Deferred tax on fair value changes of securities measured at fair
value through other comprehensive income
Subtotal of items that cannot be reclassified to profit or loss
Gains / (losses) on exchange differences on translation of subsidiaries
-9,379,794 26,809,123
Subtotal of items eligible for reclassification to profit or loss
-9,379,794 26,809,123
Total other comprehensive income
-6,535,821 28,065,406
Comprehensive income
Comprehensive income attributable to non-controlling interests
Comprehensive income attributable to the owners of the Parent
The accompanying notes are an integral part of these consolidated financial statements.
Consolidated financial statements
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Consolidated financial statements
4. Consolidated statement of cash flows
31/12/2022 31/12/2021
Note EUR EUR
Operating activities
Profit / (loss) attributable to the owners of the Parent 75,586,975 80,389,524
Profit / (loss) attributable to non-controlling shareholders 88,768,156 86,153,405
Fair value of agricultural production -8,167,929 -6,709,158
Other adjustments having no impact on cash position -7,614,477 -1,658,242
Depreciation and impairment expense 8 95,876,218 64,496,769
Provisions and allowances 7,312,366 -2,143,251
Net loss on disposals of assets 1,880,760 3,110,167
Income tax expense and deferred tax 15 76,255,766 54,378,976
Cash flows from operating activities 329,897,835 278,018,190
Interest expense 27, 28 9,025,529 9,838,397
Income tax paid 15 -71,319,742 -53,538,854
Change in inventory -8,881,196 -6,537,010
Change in trade and other receivables 5,220,302 3,161,743
Change in trade and other payables 19,354,190 16,494,145
Change in accruals and prepayments -623,303 4,178,499
Change in working capital requirement 15,069,993 17,297,377
Net cash flows from operating activities 282,673,615 251,615,110
Investing activities
Acquisitions / disposals of intangible assets -670,619 -1,857,690
Acquisitions of property, plant and equipment and biological assets 6, 7 -76,862,221 -73,604,183
Disposals of property, plant and equipment 4,196,693 2,356,151
Acquisitions / disposals of financial assets 70,269 21,543
Net cash flows from investing activities
-73,265,878 -73,084,179
Financing activities
Acquisition of additional interests in subsidiaries -2,177,315 -1
Dividends paid to the owners of the Parent
30
-17,699,650 -1,415,972
Dividends paid to non-controlling shareholders
11
-66,091,730 -32,103,320
Proceeds from borrowings
23
Repayment of borrowings
23
-89,450,023 -144,874,371
Repayment of lease liabilities
23
-2,035,612 -1,883,386
Interest paid
27, 28
-9,025,529 -9,838,397
Net cash flows from financing activities -179,449,571 -98,297,181
Effect of exchange rate fluctuations 621,212 2,896,632
Net cash flow 30,579,378 83,130,382
Cash and cash equivalents at 1
st
January 19 137,285,678 54,155,296
Cash and cash equivalents at 31
st
December 19 167,865,056 137,285,678
Net increase / (decrease) in cash and cash equivalents 30,579,378 83,130,382
The accompanying notes are an integral part of these consolidated financial statements.
Consolidated financial statements
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5. Consolidated statement of changes in equity
EUR
Share
capital
Share
premium
Legal
reserve
Translation
reserves
Conso-
lidated
reserves
Equity
attributable
to the
owners of
the Parent
Non-
controlling
interests
TOTAL
EQUITY
Balance at 1
st
January 2021
Profit / (loss) for the period
Actuarial (losses) / gains
Change in fair value of securities at fair value
through other comprehensive income
-16,199 -16,199 -11,106 -27,305
Foreign currency translation adjustments
Transfer between reserves
Other comprehensive income
Dividends (Note 30)
Interim dividends (Note 30)
-1,415,972 -1,415,972 -3,431,937 -4,847,909
Other movements
-32,058 -32,058 56,153 24,095
Transactions with shareholders
-1,448,030 -1,448,030 -32,047,167 -33,495,197
Balance at 31
st
December 2021
Balance at 1
st
January 2022
Profit / (loss) for the period
Actuarial (losses) / gains
Change in fair value of securities at fair value
through other comprehensive income
-12,301 -12,301 -8,381 -20,682
Foreign currency translation adjustments
-8,263,664 0 -8,263,664 -1,116,130 -9,379,794
Transfer between reserves
Other comprehensive income
-8,262,956 77,181,978 68,919,021 88,900,287 157,819,307
Dividends (Note 30)
-7,079,860 -7,079,860 -41,246,080 -48,325,940
Interim dividends (Note 30)
-10,619,790 -10,619,790 -24,845,650 -35,465,440
Other movements (Notes 2,11)
-715,275 474,548 -240,726 -1,653,996 -1,894,222
Transactions with shareholders
-715,275 -17,225,102 -17,940,376 -67,745,726 -85,686,102
Balance at 31
st
December 2022
The accompanying notes are an integral part of these consolidated financial statements.
Consolidated financial statements
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6. Notes to the consolidated financial statements
Note 1. Overview and accounting policies
1.1. Overview
Socfin (“the Company”) was incorporated on
5
th
December 1959. Its corporate purpose qualifies
it as a soparfi since the Annual General Meeting of
10
th
January 2011. The registered office is established
at 4 avenue Guillaume, L-1650 in Luxembourg .
The main activity of the Company and its subsidiaries
(the “Group”) is the management of a portfolio of
interests mainly focused on the operation of tropical
palm oil and rubber plantations in Africa and South-
East of Asia.
The Company is listed on the Luxembourg Stock
Exchange under ISIN LU0027967834 and is registered
in the commercial register under number B5937.
1.2. Statement of compliance
The consolidated financial statements have been
prepared on a going concern basis and in accordance
with International Financial Reporting Standards
(IFRS) as adopted by the European Union and the
On 29
th
March 2023, the Board of Directors approved
the consolidated financial statements.
In conformity with the current legislation existing
in the Grand Duchy of Luxembourg, the financial
statements will be approved by the shareholders
during the Annual General Meeting. The official
version of the accounts is the ESEF version available
with the Officially Appointed Mechanism (OAM) tool.
New standards and amendments issued but not yet
effective on 1
st
January 2022:
The Group does not expect the adoption of
the standards and amendments described below
to have a material impact on its consolidated
financial statements, nor anticipate early adoption
of new accounting standards, amendments and
interpretations.
- 18
th
May 2017, the IASB issued IFRS 17 ˝Insurance
Contracts˝, which establishes principles for the
recognition, measurement and presentation of
insurance contracts. Under IFRS 17, insurance
performance should be measured at its current
execution value and provide a more consistent
measurement and presentation method for all types
of insurance contracts. IFRS 17 replaces IFRS 4
˝Insurance contracts˝ and its interpretations. It is
effective as of 1
st
January 2023 and early adoption is
permitted if IFRS 15 ˝Revenue from Contracts with
Customers˝ and IFRS 9 ˝Financial Instruments˝ have
been applied. On 9
th
December 2021, the IASB issued
amendments to IFRS 17, aimed at helping entities to
avoid temporary accounting mismatches between
financial assets and insurance contract liabilities.
- On 7
th
May 2021, the IASB published amendments
to IAS 12 ˝Deferred Tax related to Assets and
Liabilities arising from a Single Transaction˝. The
amendments narrowed the scope of the recognition
exemption in paragraphs 15 and 24 of IAS 12
(recognition exemption) so that it no longer applies
to transactions that, on initial recognition, give
rise to equal taxable and deductible temporary
differences. They are effective for financial years
beginning on or after 1
st
January 2023 and are to
be applied retrospectively, with early adoption
permitted.
- On 12
th
February 2021, the IASB issued amendments
to IAS 1, IFRS Practice Statement 2 ˝Making
Judgments about Materiality˝ and IAS 8. The
amendments are intended to assist preparers in
determining the accounting policies to be presented
in their financial statements, to further enhance the
importance in determining the accounting policies,
and to distinguish changes in accounting estimates
from changes in accounting policies. They are
effective for financial years beginning on or after
1
st
January 2023 and are to be applied prospectively,
with early adoption permitted.
Consolidated financial statements
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New IFRS standards, amendments and
interpretations not yet endorsed by the European
Union:
- On 23
rd
January 2020, the IASB published amendments
to IAS 1 “Presentation of Financial Statements” on
the classification of liabilities as current and non-
current in order to establish a more general approach
to the classification of liabilities under IAS 1, based
on an analysis of contracts existing at the balance
sheet date. The amendments include clarification
of the requirements for classifying liabilities that
a company could settle by converting them into
equity. On 15
th
July 2020, the IASB deferred the
effective date of the amendments. On 31
st
October
2022, the IASB issued “Non-current Liabilities with
Covenants” to clarify how conditions with which
an entity must comply within twelve months
after the reporting period affect the classification
of a liability. The amendments are effective for
reporting periods beginning on or after 1
st
January
2024. The Group does not expect the adoption of
these amendments to have a material impact on its
consolidated financial statements.
- On 22
nd
September 2022, the IASB issued
amendments to IFRS 16 “Lease Liability in a
Sale and Leaseback”, that clarify how a seller-
lessee subsequently measures sale and leaseback
transactions that satisfy the requirements in IFRS 15
to be accounted for a sale. The amendment does
not change the accounting for leases unrelated to
sale and leaseback transactions. The amendment
applies retrospectively to annual reporting periods
beginning on or after 1
st
January 2024, with early
adoption permitted. The Group does not expect the
adoption of these amendments to have a material
impact on its consolidated financial statements.
1.3. Presentation of consolidated financial
statements
They are prepared on the basis of historical cost with
the exception of the following assets:
- Biological assets (current) (IAS 2, IAS 41), derivative
instruments and securities measured at fair value
through other comprehensive income are recognised
at fair value;
- Property, plant and equipment acquired as part of a
business combination (IFRS 3) are measured initially
at their fair value at the date of acquisition.
The accounting principles and rules are applied in a
consistent and permanent way within the Group. The
consolidated financial statements are prepared for
the accounting year ending 31
st
December 2022 and
are presented before the Annual General Meeting of
shareholders approving the allocation of the parent
company’s income.
As of 1
January 2022, the Group adopted the
following amendments without any material impact
on the Group’s consolidated financial statements:
- Amendment to IFRS 3 Business Combinations -
reference to the Conceptual Framework: the
amendments updated the reference to the
Conceptual Framework for Financial Reporting,
added a reference to IAS 37 or IFRIC 21 when a
company identifies the liabilities assumed in a
business combination, and stated that an acquirer
should not recognise contingent assets acquired in a
business combination.
- Amendment IAS 16 Property, Plant and Equipment:
the amendments prohibit a company from deducting
from the cost of property, plant and equipment
amounts received from selling items produced while
the company is preparing the asset for its intended
use. Instead, a company should recognise such sales
proceeds and related cost in profit or loss.
- Amendments to IAS 37 Provisions, Contingent
Liabilities and Contingent Assets: Onerous Contracts
— Cost of Fulfilling a Contract: these amendments
specify which costs a company includes when
assessing whether a contract will be loss-making.
- Annual Improvements to IFRS Standards 2018–2020.
These amendments concern IFRS 1, IFRS 9, IFRS 16
and IAS 41:
o IFRS 1 (1
st
time adopter): allows a subsidiary
to measure translation differences using the
amounts reported by its parent, based on the
parent’s date of transition to IFRS
o IFRS 16: removal from the illustrative examples
of the illustration of the reimbursement of
leasehold improvements by the lessor
o IFRS 9: the amendment clarifies which fees an
entity includes when it applies the ˝10 per cent˝
st
Consolidated financial statements
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ANNUAL REPORT 2022
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test in paragraph B3.3.6 of IFRS 9 in assessing
whether to derecognise a financial liability
o IAS 41: the amendment removes the requirement
in IAS 41.22 for entities to exclude taxation
cash flows when measuring the fair value of a
biological asset using a present value technique.
1.4. Consolidation principles
The consolidated financial statements include the
financial statements of the parent company Socfin
as well as those of the companies controlled by the
parent (“subsidiaries”), all of which constitute the
“Group “.
All companies included in the scope of consolidation
as of 31
st
December 2022 close their accounts on
31
st
December.
Subsidiaries
In accordance with IFRS 10, an investor has control
when three conditions are fulfilled:
1) it holds power over the entity;
2) it is entitled to or is exposed to variable returns
from its involvement;
3) it has the ability to use its power over the entity to
affect returns.
Currently, the Group holds the majority of the voting
rights in the entities.
Income and expenses from subsidiaries acquired or
sold during the year are included in the consolidated
income statement, respectively, from the date of
acquisition to the date of disposal.
Profit or loss and each component of other
comprehensive income are attributed to the equity
holders of the parent of the Group and to the non-
controlling interests, even if this results in the non-
controlling interests having a deficit balance.
Where appropriate, restatements are made to the
financial statements of the subsidiaries to align
the accounting principles used with those of other
companies in the scope of consolidation.
All intra-group balances and transactions are
eliminated upon consolidation.
If the Group loses control over a subsidiary, it
derecognises the related assets (including goodwill),
liabilities, non-controlling interest and other
components of equity, while any residual gain or loss
is recognised in profit or loss. Any investment retained
is recognised at fair value.
The list of subsidiaries of the Group is presented in
Note 2.
1.5. Changes in accounting policies, errors and
changes in estimates
A change in accounting policy is applied only if it meets
the requirements of a standard or interpretation or
permits more reliable and relevant information. Changes
in accounting policies are accounted for retrospectively,
except in the case of transitional provisions specific to
the standard or interpretation. A material error, when
discovered, is also adjusted retrospectively.
Uncertainties inherent in the activity require the use
of estimates when preparing financial statements.
The estimates are based on judgments intended to
give a reasonable assessment of the latest reliable
information available. An estimate is revised to reflect
changes in circumstances, new information available
and the effects of experience.
1.6. Business combinations
IFRS 3 “Business Combinations” provides the accounting
basis for recognising business combinations and changes
in interests in subsidiaries after obtaining control.
For each business combination, the Group elects
whether to measure the non-controlling interests in
the acquiree at fair value or at the proportionate
share of the acquiree’s identifiable net assets.
Changes in interest in a subsidiary that do not
result in loss of control are accounted for as equity
transactions.
1.7. Goodwill
Goodwill is the difference on the date of acquisition
between the fair value of the consideration given
in exchange for taking control, the value of non-
controlling interests, the fair value of previous
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equity investments and the fair value of identifiable
assets and liabilities and contingent liabilities of the
acquiree.
When disposing of a subsidiary, the residual amount of
goodwill attributable to the subsidiary is included in
the calculation of the result of disposal.
1.8. Gain on a bargain purchase
Gain on a bargain purchase represents the excess of
the Group’s interest in the fair value of identifiable
assets and liabilities and the contingent liabilities of
a subsidiary or associate on the cost of acquisition on
the acquisition date.
To the extent that gain on a bargain purchase remains
after considering and reassessing the fair value of
identifiable assets and liabilities and contingent
liabilities of a subsidiary or associate, it is recognised
directly as an income in the income statement.
1.9. Foreign currency conversion
In the financial statements of Socfin and of each
subsidiary, transactions in foreign currency are recorded,
upon initial recognition, in the functional currency of
the company concerned by applying the exchange rate
in force on the transaction date. At closing, monetary
assets and liabilities denominated in foreign currencies
are converted on the last day of the year. Gains and
losses arising from the realisation or translation of
monetary items denominated in foreign currencies are
recorded in the income statement for the year.
On consolidation, the assets and liabilities of companies
whose accounts are held in a currency other than the
euro are translated into euros at the exchange rate
prevailing on the closing date. Income and expenses
are converted into euros at the average exchange rate
for the year. Any exchange differences are classified as
equity under “Translation differences”. In the event
of a disposal, the translation differences relating to
the company concerned are recognised in the income
statement for the year in which the sale occurred.
Goodwill and fair value adjustments arising on the
acquisition of a foreign entity are treated as assets and
liabilities of the foreign entity and translated at the
closing rate.
The following exchange rates have been used for the
conversion of the consolidated annual accounts:
Closing rate Average Rate
1 euro equals to: 31/12/2022 31/12/2021 2022 2021
Euro
1.000 1.000 1.000 1.000
CFA franc
655.957 655.957 655.957 655.957
Ghanaian cedi
9.1472 6.8025 8.4184 6.8705
Indonesian rupiah
16,713 16,161 15,648 16,938
Nigerian naira
478.92 467.50 445.11 471.97
Dobra of São Tomé
24.50 24.50 24.50 24.50
Congolese franc
2,151 2,265 2,103 2,351
American dollar
1.0666 1.1326 1.0479 1.1809
1.10. Intangible assets
Intangible assets are stated at their acquisition cost
less accumulated depreciation and any impairment
losses.
Amortisation is applied on a straight-line basis
based on an estimate of the useful life of the asset
in question. Intangible assets are not subject to
revaluation. When the recoverable value of an asset
is lower than its book value, the latter is reduced to
reflect this loss in value.
The estimated useful lives are as follows:
Patents 3 to 5 years
Other intangible assets 3 to 5 years
Software 3 to 5 years
Concessions Length of the concessions
Amortisation starts from the date of bringing the asset
into use.
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Gains or losses arising on derecognition of assets
(difference between the disposal proceeds and the
carrying amount of the asset) are included in the
income statement when assets are derecognised.
1.11. Property, plant and equipment
Tangible fixed assets are recorded at their acquisition
cost less accumulated amortisation and any
impairment losses.
Property, plant and equipment in progress is carried at
cost less any identified impairment.
Depreciation is applied on a straight-line basis based
on an estimate of the useful life for each significant
component of the asset in question. When the
recoverable value of an asset is lower than its book
value, the latter is reduced to reflect this loss in value.
The estimated useful lives are as follows:
Buildings 20 to 50 years
Technical installations 3 to 20 years
Furniture, vehicles and others 3 to 20 years
Depreciation starts from the date that the assets are
brought into use.
Land is not subject to depreciation.
Gains or losses arising on derecognition of assets
(difference between the disposal proceeds and the
carrying amount of the asset) are included in the
income statement when assets are derecognised.
1.12. Investment properties
Investment properties are real estate (land and
buildings or part of buildings) held for rental or capital
appreciation.
Investment properties are recorded at cost less
accumulated depreciation and any impairment charges.
Depreciation is determined on a straight-line basis
over the useful life of the asset. The depreciation
period for investment properties is set at 50 years.
Gains or losses arising on derecognition of assets
(difference between the disposal proceeds and the
carrying amount of the asset) are included in the
income statement when assets are derecognised.
1.13. Bearer biological assets
The Group has biological assets in Africa and Asia.
Bearer plants, mainly consisting of palm oil and rubber
plantations, are valued by using the cost model,
according to the principles defined in IAS 16 “Tangible
fixed assets”.
Biological assets at the time of harvest, in particular
for palm bunches, palm oil and rubber, are evaluated
according to the principles defined by IAS 41
“Agriculture”.
Bearer biological assets
Producer biological assets are recorded at acquisition
cost, less accumulated amortisation and any
impairment losses.
Depreciation is applied according to the straight-line
method based on an estimate of the useful life. When
the recoverable amount of an asset is less than its
carrying amount, the carrying amount is reduced to
reflect that impairment.
The estimated useful lives are as follows:
Bearer plants – Palm 20 to 26 years
Bearer plants - Rubber 20 to 33 years
Depreciation starting date is the date of transfer of
biological assets in production (asset being mature). This
transfer takes place in the third year after palm oil tree
planting in Asia, in the fourth year after palm oil tree
planting in Africa and in the seventh year after rubber
tree planting. For each entity, the operating period can
be adapted according to the particular circumstances.
Agricultural production
Agricultural production at harvest is valued at fair
value less estimated costs necessary to complete the
sale.
There are no observable data for agricultural
production (palm harvest, latex). The World Bank
publishes price forecasts for dry rubber (finished
product). These forecasts are based on the RSS3 grade
(smoked sheet) that is not produced by the Group.
Lastly, and even more so, there are no observable
prospective data relating to the Group’s agricultural
production. The price of a standard product in a
global market is not sufficiently representative of
the economic reality in which the various entities of
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the Group intervene. This price cannot be used as a
reference for valuation.
As a result, each entity determines the fair value of
agricultural production based on actual market prices
obtained over the past year.
The Group considers produce that grows on mature
plantations (oil in the palm fruits and produce of
rubber) as biological assets, in accordance with IAS 41
principles. This produce is measured at fair value
until the point of harvest. Any resultant gains or losses
arising from changes in fair value are recognised in
the income statement.
1.14. Leases
The Group assesses at contract inception whether
a contract is, or contains, a lease. That is, if the
contract conveys the right to control the use of an
identified asset for a period of time in exchange for
consideration.
The Group applies a single recognition and
measurement approach for all leases, except for short-
term leases and leases of low-value assets (mainly
IT equipment), for which payments associated are
recognised as an expense in the income statement.
The Group recognises lease liabilities to make lease
payments and right-of-use assets representing the
right to use the underlying assets.
The Group leases offices and agricultural land for terms
ranging from 1 to 99 years, as well as vehicles and
equipment for terms ranging from 1 month to 5 years.
The Group’s lease contracts are standard contracts
that do not include additional non-leasing components,
except for some vehicle lease contracts that include
a maintenance service. The Group has used the
practical expedient that allows not separating the
lease component from the non-lease component for
these contracts.
Assets and liabilities related to lease contracts are
initially measured at the present value of the fixed
payments including in-substance fixed payments less
any lease incentives receivable. Lease payments to
be made under reasonably certain extension options
are also included in the measurement of the liability.
To this purpose, management considers all facts
and circumstances that may create an incentive to
exercise a renewal option or not to exercise an early
termination option. The lease liability is remeasured
if there is a change in the lease term, in the lease
payment or in the assessment of an option to purchase
the underlying asset.
As the implicit interest rate is not known for all the
Group’s contracts, the incremental borrowing rate was
used to discount the lease payments. The incremental
borrowing rate is the rate that the lessee would have
to pay to borrow, for a similar term and with a similar
guarantee, the funds necessary to acquire an asset of
similar value to the asset under the right-of-use in a
similar economic environment.
In determining the incremental borrowing rate, the
Group:
- where possible, uses the most recent financing
received by the lessee as a starting point, adjusted
to reflect the change in financing conditions since
the financing was received;
- uses a build-up approach starting with a risk-free
rate adjusted for credit risk for leases for entities
with no recent external financing;
- makes lease specific adjustments (such as term,
country, currency and collateral).
The discount rates used by the Group range between
1.75% and 19.9%.
Lease payments are allocated between the repayment
of the principal amount of the lease liabilities and
interest expense. Interest expense is recognised in
the income statement for the period over the term
of the lease. Right-of-use assets are depreciated on
The Group applies IAS 36 to determine whether a
right-of-use asset is impaired and recognises any
impairment loss as described in Note 9: Impairment
of assets.
1.15. Impairment of assets
Goodwill is not amortised but is tested for impairment
at least once a year and whenever there is an
indication of impairment.
In addition, at each reporting date, the Group reviews
the carrying amounts of its intangible and tangible
assets, including its organic producing assets, in order
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to assess whether there is any indication that its assets
may have lost value. If there is such an indication,
the recoverable amount of the asset is estimated to
determine, if applicable, the amount of the loss or
impairment. The recoverable amount is the higher of
the fair value less costs to sell the asset and the value
in use.
The fair value of property, plant and equipment and
intangible assets is the present value of estimated
future cash flows expected from the use of an asset
or cash-generating unit. When it is not possible to
estimate the recoverable amount of an isolated asset,
the Group determines the recoverable amount of the
cash-generating unit to which the asset belongs.
If the recoverable amount of an asset (or a cash-
generating unit) is estimated to be less than its
carrying amount, the carrying amount of the asset
(cash-generating unit) is reduced to its recoverable
amount. Impairment losses are immediately
recognised as expenses in the income statement.
When an impairment loss recognised in a prior period
no longer exists or needs to be written down, the
carrying amount of the asset (cash-generating unit) is
increased to the extent of the revised estimate of its
recoverable amount. However, this increased carrying
amount may not exceed the carrying amount that would
have been determined if no impairment loss had been
recognised for the asset (cash-generating unit) in prior
years. The reversal of an impairment loss is recognised
immediately in income in the income statement.
An impairment loss recorded on goodwill cannot be
subsequently reversed.
1.16. Inventories
Inventories are recorded at the lower of cost and net
realisable value. Cost includes direct material costs
and, if applicable, direct labour costs and directly
attributable overhead costs.
Where specific identification is not possible, the cost is
determined on the basis of the weighted average cost
method. Net realisable value is the estimated selling
price in the ordinary course of business less estimated
costs of completion and the estimated costs necessary
to complete the sale (primarily selling expenses).
Impairment or loss on inventory to net realisable value
is recognised as an expense in the period in which the
impairment or loss occurred.
As explained in Note 1.13. Bearer biological assets,
agricultural production is measured at fair value less
estimated costs necessary to make the sale.
1.17. Trade receivables
Trade receivables are valued at their nominal value and
do not bear interest. The Group applies a simplified
approach and records a provision for expected losses
over the life of the receivables. This provision for
losses is an amount that the Group considers a reliable
estimate of the inability of its customers to make the
required payments (refer to Note 34).
1.18. Cash and cash equivalents
This item includes cash, demand deposits, short-term
deposits of less than 3 months, as well as investments
easily convertible into a known amount of cash,
having a maturity of three months or less, and which
are subject to a negligible risk of change in value.
1.19. Financial instruments
Financial assets and liabilities are recognised in the
consolidated statement of financial position when the
Group becomes a party to the contractual provisions
of the instrument.
Financial instruments derivatives
Financial instruments derivatives are measured at fair
value at each reporting date.
The accounting treatment depends on the qualification
of the instrument concerned:
- Hedging instruments:
The Group refers to certain hedging instruments,
including foreign exchange risk and interest rate risk
derivatives, as cash flow hedges. Foreign currency
hedges related to firm commitments are accounted
for as cash flow hedges.
At the inception of the hedging relationship, the entity
prepares documentation describing the relationship
between the hedging instrument and the hedged
item as well as its risk management objectives and
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strategy for performing various hedging transactions.
In addition, when the hedge is created and regularly
thereafter, the Group indicates whether the hedging
instrument is highly effective in offsetting changes
in the fair value or cash flows of the hedged item
attributable to the hedged risk.
The effective portion of changes in the fair value of
derivatives that are designated as cash flow hedges
and qualify for such designation is recognised in
other comprehensive income and accumulated in the
hedging reserve, cash flow. The gain or loss related to
the ineffective portion is recognised immediately in
profit or loss, in other gains and losses.
Amounts previously recognised in other comprehensive
income and accumulated in equity are reclassified
to net income in the periods in which the hedged
item affects net income, to the same account as
the recognised hedged item. However, if a hedged
forecast transaction results in the recognition of a
non-financial asset or liability, the gains and losses that
were previously recognised in other comprehensive
income and accumulated in equity are taken out of
equity to be recognised in the initial measurement of
the cost of the non-financial asset or liability.
For the periods 2021 and 2022, no hedging instruments
were used by the Group.
- Other instruments:
Changes in the fair value of derivative financial
instruments that do not qualify for hedge accounting
are recognised in the income statement when they
occur.
To hedge its exposure to certain foreign exchange
risks, the Group uses forward exchange contracts:
for the periods 2021 and 2022, forward exchange
contracts were used by the Group.
Loans
The Group’s business model for financial assets
management refers to the way it manages its financial
assets in order to generate cash flows. The business
model determines whether cash flows will result from
the collection of contractual cash flows, the disposal
of financial assets or both. Financial assets classified
and measured at amortised cost are held in a business
model with the objective of holding financial assets
to collect contractual cash flows. Long-term advances
and other receivables are held for the sole purpose
of collecting principal and interest. As such, they
comply with the “Solely Payments of Principal and
Interest” (SPPI) model. They are accounted for using
the amortised cost method.
The Group applies the low credit risk simplification: at
every reporting date, the Group evaluates whether the
debt instrument is considered to have low credit risk
using all reasonable and supportable information that
is available without undue cost or effort. In making
that evaluation, the Group reassesses the internal
credit rating of the debt instrument. In addition,
the Group considers that there has been a significant
increase in credit risk when contractual payments are
more than 30 days past due.
Interest-bearing borrowings and overdrafts are
recorded for amounts received, net of direct issue
costs. Financial expenses are recognised in income
statement and are added to the carrying amount of
the instrument to the extent that they are unpaid in
the year in which they occur.
The carrying amount is a reasonable approximation of
fair value in the case of financial instruments such as
borrowings and debts with short-term maturity.
The fair value measurement of borrowings and debts
with financial institutions, other than in the short
term, depends both on the specifics of the loans and
on current market conditions. The fair value was
calculated by discounting the expected future cash
flows at the re-estimated interest rates prevailing at
the balance sheet date over the remaining term of
repayment of the loans (Refer to Note 25).
The Group relied on the evolution of the interest
rate of the European Central Bank adjusted for the
specific risk inherent in each financial instrument, as
a reasonable benchmark for estimating the fair value
of such borrowings (see Note 25).
Financial assets designated at fair value through
OCI (equity instruments)
Upon initial recognition, the Group can elect to
classify irrevocably its equity investments as equity
instruments designated at fair value through OCI
when they meet the definition of equity under IAS 32
Financial Instruments: Presentation and are not held
for trading. The classification is determined on an
instrument-by-instrument basis.
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Gains and losses on these financial assets are never
recycled to profit or loss. Dividends are recognised as
other income in the statement of profit or loss when
the right of payment has been established, except
when the Group benefits from such proceeds as a
recovery of part of the cost of the financial asset, in
which case, such gains are recorded in OCI. Equity
instruments designated at fair value through OCI are
not subject to impairment assessment.
The Group elected to classify irrevocably its non-
listed equity investments under this category.
Other financial assets and liabilities
Other financial assets and liabilities are recorded at
their acquisition cost. The fair value of other financial
assets and liabilities is estimated to be close to the
carrying amount.
The receivables are valued at their nominal value
(at cost) less any write-downs covering amounts
considered as non-recoverable if the Group deems it
necessary. Impairment of assets is recognised in the
income statement under “Other operating income/
expenses”. The Group has established a provision
matrix, based on its historical credit loss experience
(average default over several years), adjusted for
prospective factors specific to the debtors and the
economic environment. The carrying amount of
the asset is reduced through the use of a provision
account and the amount of the loss is recognised in
the consolidated income statement. The Board of
Directors of each subsidiary evaluates the receivables
individually. Value adjustments are determined taking
into account the local economic reality of each
country. They are reviewed at the reception of new
events and at least annually.
1.20. Provisions
Provisions are recognised when the Group has a
present obligation (legal or constructive) resulting
from a past event which will probably lead to an
outflow of economic benefits that can be reasonably
estimated.
Restructuring provisions are recognised when the Group
has a formal and detailed plan for the restructuring
that has been notified to the affected parties.
1.21. Pension obligations
Defined contribution plans
These plans designate the post-employment benefit
plans under which the Group pays defined contributions
to external insurance companies for certain categories
of employees. Payments made under these pension
plans are recognised in the income statement in the
year in which they are due.
As these plans do not generate future commitments
for the Group, they do not give rise to provisions.
Defined benefit plans
These plans refer to post-employment benefit plans
that provide additional income to certain categories
of employees for services rendered during the year
and prior years.
This guarantee of additional resources is a future
expenditure for the Group for which a commitment
is calculated by independent actuaries at the end of
each financial year.
The actuarial assumptions used to determine the
liabilities vary according to the economic conditions
prevailing in the country in which the plan is located.
The discount rates applicable to discount post-
employment benefit obligations should be determined
by reference to the market yields on high quality
corporate bonds that are appropriate to the estimated
timing of benefit payments at the balance sheet date.
The Group decided to calculate discount rates using an
economic approach for high-quality corporate bonds
corresponding to the terms of the employee benefits
in the countries concerned. In the countries where
there is no active market for such obligation, the
Group refers to the market yields (at the end of the
reporting period) of government bonds. The currency
and duration of these corporate or government bonds
must correspond to the currency and estimated
duration of the post-employment benefit obligations.
The cost of corresponding commitments is determined
using the projected unit credit method, with a
discounted value calculation at the balance sheet date
in accordance with the principles of IAS 19 “Employee
Benefits”.
All changes in the amount of defined benefit pension
obligations are recognised as they occur.
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Remeasurements of defined benefit pension obligations,
including actuarial gains and losses, should be recognised
immediately in “Other comprehensive income”.
The costs of services rendered during the period, past
service costs (plan amendment) and net interest are
recognised as an expense immediately.
The amount recognised in the statement of financial
position is the present value of the pension obligations
of the defined benefit plans adjusted for actuarial
gains and losses and less the fair value of plan assets.
1.22. Revenue recognition
The Group’s revenues derive from the performance
obligation of transferring control of products under
arrangements. According to these arrangements,
the transfer of control and the fulfilment of the
performance obligation occur at the same time.
The point of control of the asset by the customer
depends on when the goods are made available to
the carrier or when the buyer takes possession of the
goods, depending on the delivery conditions. With
regards to the Group’s activities, the recognition
criteria are generally met:
(a) for export sales, where the time of the transfer of
deed based on the incoterms;
(b) for local sales, depending on the delivery
conditions, either when the goods leave the premises
or when the customer takes possession of the goods.
This is the moment when the Group has fulfilled its
performance obligations.
Revenues are valued at the transaction price of the
consideration received or receivable, which the
company expects to be entitled to.
The selling price is determined at the market price
and in a few cases the selling price is contractually
determined on a provisional basis, based on a reliable
estimate of the selling price. In the latter case, price
adjustments can then take place depending on the
movements between the reference price and the final
price, as recognised.
The Group considers being the principal in its revenue
arrangements, because it controls the goods sold
before transferring them to the customers.
As at 31
st
December 2022, revenue from the
major customer within the Group accounted
for approximately EUR 96.2 million (2021:
EUR 81.9 million) of total Group revenue.
1.23. Taxes
Current tax is the amount of tax payable or recoverable
on the profit or loss of a financial year.
Temporary differences between the book values of
assets and liabilities and their tax bases give rise to
the recognition of a deferred tax using the tax rates
whose application is provided for when reversing the
temporary differences, as adopted on the closing date.
Deferred taxes are recognised for all temporary
differences unless the deferred tax is generated by
goodwill or by the initial recognition of an asset or
a liability that is not acquired through a business
combination and does not affect the accounting profit
or the taxable profit on the transaction date.
A deferred tax liability is recognised for all taxable
temporary differences related to investments in
subsidiaries and associates, unless the date on which
the temporary difference will be reversed can be
controlled and it is likely that it will not reverse in the
foreseeable future.
A deferred tax asset is recognised to carry forward
unused tax losses and tax credits to the extent that it
is probable that future taxable profits will be available
on which these unused tax losses and tax credits can
be charged.
Deferred tax is recognised in the income statement
unless it relates to items that have been directly
recognised, either in equity or in other comprehensive
income.
1.24. Segment information
IFRS 8 “Operating Segments” requires operating
segments to be identified based on the internal
reporting analysed by the entity’s chief operating
decision-maker to assess performance and make
resource decisions for the segments.
The identification of these operational sectors follows
from the information analysed by the management
which is based on the geographic distribution of
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political and economic risks and on the analysis of
individual social accounts at historical cost.
1.25. Use of estimates
For the preparation of consolidated financial
statements in accordance with IFRS, Group
management has had to make assumptions based on
its best estimates that affect the carrying amount
of assets and liabilities, information on assets and
liabilities, contingent liabilities and the carrying
amount of income and expenses recorded during
the period. Depending on the evolution of these
assumptions or different economic conditions,
the amounts that will appear in the Group’s future
consolidated financial statements may differ from
current estimates. Significant accounting policies, for
which the Group has made estimates, mainly concern
the application of IAS 19 (Note 22), IAS 41 / IAS 2
(Notes 7 and 16), IAS 16 (Note 6), IAS 36 (Notes 8 and
9), IFRS 9 (Note 25) and IFRS 16 (Note 4).
In the absence of observable data within the scope of
IFRS 13, the Group makes use of a model developed to
assess the fair value of agricultural production based
on local production costs and conditions and local
sales (Refer to Note 1.13).
This method is inherently more volatile than
assessment at historical cost.
1.26. Climate effect
The Group considered the potential impact of the
climate change, which may affect positively and
negatively the Group’s biological assets thus the
financial performance of the Group, the distribution
of rainfall and sunshine being the most important
factors.
The Group considered climatic events such as severe
wind or fires in the valuation of the biological assets,
however and given the actual level of knowledge,
distinguishing impacts of natural climate variations
apart from climate impacts related to anthropic
activity remain difficult.
The effects of the climate change on the Group’s
financial statements as at 2022 year-end remain
uncertain. The Management Board considered various
documentation in its assessment of the impact, such
as the last Intergovernmental Panel on Climate Change
(IPCC) reports, that do not link the climate change to
a negative impact on oil palm plantations.
The Management Board will continue to consider
the potential impacts of the climate change in its
judgements, and will integrate any new potential
impact if this could lead to a material change in the
Group’s financial statements.
1.27. Russia – Ukrain conflict
In February 2022, a number of countries (including
the US, UK and EU) imposed sanctions against certain
entities and individuals in Russia as a result of the
official recognition of the Donetsk People Republic and
Lugansk People Republic by the Russian Federation.
Announcements of potential additional sanctions have
been made following military operations initiated by
Russia against the Ukraine on 24
th
February 2022.
Due to these geopolitical tensions, there has been a
significant increase in volatility on the securities and
currency markets in 2022, as well as a significant
depreciation of the ruble against the US dollar and
the euro.
Although neither the company’s performance and
going concern nor operations, have been significantly
impacted by the above during 2022, the Board of
Directors continues to monitor the evolving situation
and its impact on the financial position and results of
the company.
Consolidated financial statements
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Note 2. Subsidiaries and associates
% Group
Interest
% Group
Control
Consolidation
Method (*)
% Group
Interest
% Group
Control
Consolidation
Method (*)
2022 2022 2022 2021 2021 2021
AFRICA
Rubber and palm
SOGB S.A. 41.17 73.16 FI 41.09 73.16 FI
PLANTATIONS SOCFINAF GHANA "PSG" LTD 64.64 100.00 FI 64.51 100.00 FI
OKOMU OIL PALM COMPANY PLC 42.90 66.38 FI 42.08 65.23 FI
SOCIETE AFRICAINE FORESTIERE ET AGRICOLE DU CAMEROUN "SAFACAM" S.A.
44.63 69.05 FI 44.55 69.05 FI
SOCIETE CAMEROUNAISE DE PALMERAIES "SOCAPALM" S.A. 43.60 67.46 FI 43.52 67.46 FI
Rubber
LIBERIAN AGRICULTURAL COMPANY "LAC" 64.64 100.00 FI 64.51 100.00 FI
SALALA RUBBER CORPORATION "SRC" 64.64 100.00 FI 64.51 100.00 FI
SUD COMOË CAOUTCHOUC "SCC" S.A. 39.39 70.01 FI 39.32 70.01 FI
Palm
SOCFIN AGRICULTURAL COMPANY "SAC" LTD 60.11 93.00 FI 60.00 93.00 FI
SOCIETE DES PALMERAIES DE LA FERME SUISSE "SPFS" S.A. 43.60 100.00 FI 43.52 100.00 FI
AGRIPALMA LDA 56.88 88.00 FI 56.77 88.00 FI
BRABANTA S.A. 64.64 100.00 FI 64.58 100.00 FI
Other activities
BEREBY-FINANCES "BEFIN" S.A. 56.27 87.06 FI 56.16 87.06 FI
CAMSEEDS S.A. 43.70 100.00 FI 43.62 100.00 FI
SOGESCOL CAMEROUN "SOGESCOL CAM" S.A.R.L.
61.44 100.00 FI 61.30 100.00 FI
ASIA
Rubber and palm
PT SOCFIN INDONESIA "SOCFINDO"
52.43 90.00 FI 52.28 90.00 FI
Rubber
SETHIKULA CO LTD 58.25 100.00 FI 58.09 100.00 FI
SOCFIN-KCD CO LTD 58.25 100.00 FI 58.09 100.00 FI
VARANASI CO LTD 58.25 100.00 FI 58.09 100.00 FI
COVIPHAMA CO LTD
58.25 100.00 FI 58.09 100.00 FI
EUROPE
Other activities
CENTRAGES S.A. 61.44 100.00 FI 61.30 100.00 FI
IMMOBILIERE DE LA PEPINIERE S.A. 61.44 100.00 FI 61.30 100.00 FI
INDUSERVICES S.A. 74.78 100.00 FI 74.68 100.00 FI
INDUSERVICES FR S.A. 61.44 100.00 FI 61.30 100.00 FI
MANAGEMENT ASSOCIATES S.A. 60.72 80.00 FI 62.91 90.00 FI
PLANTATION NORD-SUMATRA LTD "PNS Ltd" S.A. 58.25 100.00 FI 58.09 100.00 FI
SOCIETE ANONYME FORESTIERE AGRICOLE "SAFA" S.A.S. 64.64 100.00 FI 64.51 100.00 FI
SOCFINAF S.A. 64.64 64.64 FI 64.51 64.51 FI
SOCFINASIA S.A. 58.25 58.25 FI 58.09 58.09 FI
SOCFINCO S.A. 61.44 100.00 FI 61.30 100.00 FI
SOCFINCO FR S.A. 61.44 100.00 FI 61.30 100.00 FI
SOCFINDE S.A. 59.48 99.92 FI 59.33 99.92 FI
SODIMEX S.A. 0.00 0.00 NC 61.30 100.00 FI
SODIMEX FR S.A. 61.44 100.00 FI 61.30 100.00 FI
SOGESCOL FR S.A. 61.44 100.00 FI 61.30 100.00 FI
STP INVEST S.A. 64.64 100.00 FI 64.51 100.00 FI
TERRASIA S.A. 68.27 100.00 FI 68.15 100.00 FI
(*) Consolidation Method: FI: Fully integrated, NC: Not Consolidated
Other entities not consolidated due to their low materiality: Socficom and Soggai.
Consolidated financial statements
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List of subsidiaries and associates
* AGRIPALMA LDA is a company located on the
island of São Tomé and Principe specialised in the
production of palm oil.
* BEREBY-FINANCES “BEFIN” S.A. is a holding
company under Ivorian law owning the Ivorian
companies SOGB S.A. and SCC. S.A.
* BRABANTA S.A. is a Congolese company specialised
in the production of palm oil.
* CAMSEEDS S.A. is a company under Cameroon
law specialised in research, development and
production of seeds (palm).
* CENTRAGES S.A. is a company under Belgian law
providing administrative and accounting services
and which owns three floors of office space in
Brussels.
* COVIPHAMA CO LTD is a company under Cambodian
law involved in rubber.
* IMMOBILIERE DE LA PEPINIERE “PEPINIERE” S.A. is
a company under Belgian law with three floors of
office space in Brussels.
* INDUSERVICES S.A. is a company under Luxembourg
law whose purpose is to provide all administrative
services to all companies and organisations,
including all services relating to documentation,
bookkeeping and register services, as well as all
representation, study, consultation activities and
assistance.
* INDUSERVICES FR S.A. is a company under Swiss
law whose purpose is to provide all administrative
services to all companies and organisations,
including all services relating to documentation,
bookkeeping and register services, as well as all
representation, study, consultation activities
and assistance. In addition, it provides all Group
companies with access to the common IT platform.
* LIBERIAN AGRICULTURAL COMPANY “LAC” is a
company under Liberian law specialising in the
production of rubber.
* MANAGEMENT ASSOCIATES S.A. is a company under
Luxembourg law active in the transport sector.
* OKOMU OIL PALM COMPANY “OKOMU” PLC is a
company under Nigerian law specialised in the
production of palm and rubber products.
* PLANTATION NORD-SUMATRA LTD “PNS” S.A. is a
holding company under Luxembourg law which
holds stakes in PT Socfindo and Coviphama Co LTD.
* PLANTATIONS SOCFINAF GHANA “PSG” LTD is a
Ghanaian company specialised in the production
of palm and rubber products.
* PT SOCFIN INDONESIA “SOCFINDO” is a company
under Indonesian law active in the production of
palm oil and rubber.
* SOCIETE AFRICAINE FORESTIERE ET AGRICOLE DU
CAMEROUN “SAFACAM” S.A. is a company under
Cameroon law active in the cultivation of rubber
trees.
* SALALA RUBBER CORPORATION “SRC” is a company
under Liberian law active in the production of
palm oil and the cultivation of rubber trees.
* SETHIKULA CO LTD is a company under Cambodian
law holding concessions of agricultural land.
* SOCIETE CAMEROUNAISE DE PALMERAIES
“SOCAPALM” S.A. is active in Cameroon in the
production of palm oil and rubber cultivation.
* SOCFIN AGRICULTURAL COMPANY “SAC” LTD is a
company located in Sierra Leone specialised in the
production of palm oil.
* SOCFIN CONSULTANT SERVICES “SOCFINCO” S.A.
is a company established in Belgium providing
technical assistance, agronomic and financial
services.
* SOCFIN-KCD CO LTD is a company under Cambodian
law active in the production of rubber products.
* SOCFINAF S.A. is a holding company incorporated
under Luxembourg law whose activity is mainly
focused on the management of a portfolio of
active participations in plantations located in
Africa.
Consolidated financial statements
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* SOCFINASIA S.A. is a holding company under
Luxembourg law whose activity is focused on the
management of a portfolio of interests involved in
plantations located in South-East Asia.
* SOCFINCO FR S.A. is a Swiss company providing
services, studies and management of agro-
industrial plantations.
* SOCFINDE S.A. is a finance holding company under
Luxembourg law.
* SOCIETE ANONYME FORESTIERE AGRICOLE “SAFA”
S.A.S. is a company under French law holding a
stake in a plantation in Cameroon, Safacam S.A.
* SOCIETE DES PALMERAIES DE LA FERME SUISSE
“SPFS” S.A. is a company incorporated under
Cameroon law in the production and marketing of
palm oil.
* SODIMEX S.A. has been removed from the
consolidation scope in 2022, as it was liquidated
during the period.
* SODIMEX FR S.A. is a Swiss company active in the
purchase and sale of equipment for plantations.
* SOCIETE DES CAOUTCHOUCS DE GRAND-BEREBY
“SOGB” S.A. is a company under Ivorian law
specialised in the production of palm and rubber
products.
* SOGESCOL FR S.A. is a Swiss company active in the
tropical products trade.
* SOGESCOL CAMEROON “SOGESCOL CAM” S.A R.L.
is a company under Cameroon law active in the
trading of palm oil in Cameroon.
* STP INVEST S.A. is a company under Belgian law
with a stake in Agripalma LDA.
* SUD COMOË CAOUTCHOUC “SCC” is a company
under Ivorian law whose business is the processing
and marketing of rubber.
* TERRASIA S.A. is a company under Luxembourg law
set up for office ownerships.
* VARANASI CO LTD is a company under Cambodian
law holding concession of agricultural land.
Consolidated financial statements
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Note 3. Goodwill
2022 2021
EUR EUR
Gross amount at 1
st
January 16,297,341 16,297,341
Gross amount at 31
st
December
16,297,341 16,297,341
Impairment at 1
st
January -11,346,284 -11,346,284
Impairment at 31
st
December -11,346,284 -11,346,284
Net balance at 31
st
December 4,951,057 4,951,057
Goodwill resulted from the initial consolidation of
undertakings.
Impairment test on goodwill is disclosed in Note 9.
Note 4. Leases
Right-of-use assets:
EUR
Furniture,
vehicles and
other Buildings
Land and
concession of
agricultural
area TOTAL
Gross value at 1
st
January 2021 7,363,351 4,178,930 8,294,510 19,836,791
Additions 1,018,008 244,690 197,754 1,460,452
Foreign exchange differences 8,302 23,118 206,363 237,783
Gross value at 31
st
December 2021 8,389,661 4,446,738 8,698,627 21,535,026
Accumulated depreciation at 1
st
January 2021 -4,694,101 -1,654,033 -2,521,649 -8,869,783
Depreciation -1,500,098 -286,073 -244,045 -2,030,216
Foreign exchange differences -8,124 -50,087 -71,306 -129,517
Accumulated depreciation at 31
st
December 2021 -6,202,323 -1,990,193 -2,837,000 -11,029,516
Net book value at 31
st
December 2021 2,187,338 2,456,545 5,861,627 10,505,510
Gross value at 1
st
January 2022 8,389,661 4,446,738 8,698,627 21,535,026
Additions 2,517,377 0 58,191 2,575,568
Disposals 0 -136,602 0 -136,602
Transfer 0 0 1,171,888 1,171,888
Foreign exchange differences -32,383 18,542 -4,169 -18,010
Gross value at 31
st
December 2022 10,874,655 4,328,678 9,924,537 25,127,870
Accumulated depreciation at 1
st
January 2022 -6,202,323 -1,990,193 -2,837,000 -11,029,516
Depreciation -1,673,697 -300,913 -271,888 -2,246,498
Depreciation reversals 0 40,980 0 40,980
Transfer 0 0 -14,218 -14,218
Foreign exchange differences 40,887 -7,572 -9,167 24,148
Accumulated depreciation at 31
st
December 2022 -7,835,133 -2,257,698 -3,132,273 -13,225,104
Net book value at 31
st
December 2022 3,039,522 2,070,980 6,792,264 11,902,766
Consolidated financial statements
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Lease liabilities
31/12/2022 31/12/2021
EUR EUR
Long-term lease liabilities
11,087,025 10,977,779
Short-term lease liabilities
1,836,468 1,401,018
Total
12,923,493 12,378,797
The amounts recognised in the income statement in relation with lease contracts are detailed as follows:
2022 2021
EUR EUR
Depreciation of right-of-use assets 2,246,498 2,030,216
Expenses related to short-term leases and leases of low-value assets 1,735,913 2,198,658
Interest expense (included in the financial expenses) 1,147,359 1,062,744
Total
5,129,770 5,291,618
Information relating to leases where the Group is the lessor is provided in Note 10.
Agricultural concessions
The Group does not own all the land on which the biological assets are planted. In general, these lands are
subject to very long-term concessions from the local public authority. These concessions are renewable.
Company
Date of initial lease or
renewal extension
Duration of the
initial lease
Area
conceded
SAC 2013/2014 50 years 18,473 ha (1)
LAC 1959 77 years 121,407 ha
SRC 1960 70 years 8,000 ha (3)
SOGB 1995 99 years 34,712 ha
PSG 2013/2016 50 years 18,304 ha
OKOMU 1986/2001/2013 92 to 99 years 33,113 ha
SOCAPALM 2000 60 years 58,063 ha
SAFACAM 2019 3 years 2,161 ha (4)
AGRIPALMA 2009 25 years 4,252 ha (2)(5)
BRABANTA 2015/2018/2019 25 years 8,380 ha
SETHIKULA 2010 99 years 4,273 ha
VARANASI 2009 70 years 2,386 ha
COVIPHAMA 2008 70 years 5,345 ha
SOCFINDO 1995/2015/2019 25 to 35 years 47,536 ha
(1) Renewable concessions for a term of 25 years
(2) Concessions renewable tacitly for periods of 25 years
(3) Extensible concessions up to 40,000 ha
(4) Safacam owns 15,529 ha
(5) Agripalma owns 665 ha
Consolidated financial statements
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Note 5. Intangible assets
EUR
Concessions
and patents Softwares
Other
intangible
assets TOTAL
Cost at 1
st
January 2021 2,148,837 3,204,355 1,369,477 6,722,669
Additions 545,053 115,697 8,152 668,902
Disposals -421 -24,514 -6,670 -31,605
Transfer 0 -187 0 -187
Foreign exchange differences 111,205 131,571 -177 242,599
Cost at 31
st
December 2021 2,804,674 3,426,922 1,370,782 7,602,378
Accumulated depreciation at 1
st
January 2021 -269,384 -1,863,557 -1,272,432 -3,405,373
Depreciation -56,912 -303,291 -414,008 -774,211
Depreciation reversals 397 13,295 6,700 20,392
Transfer 0 187 0 187
Scope changes 0 0 380,273 380,273
Foreign exchange differences -12,651 -105,428 177 -117,902
Accumulated depreciation at 31
st
December 2021 -338,550 -2,258,794 -1,299,290 -3,896,634
Net book value at 31
st
December 2021 2,466,124 1,168,128 71,492 3,705,744
Cost at 1
st
January 2022 2,804,674 3,426,922 1,370,782 7,602,378
Additions 582,356 56,261 32,003 670,620
Disposals -446 -348,795 -221,865 -571,106
Transfer -1,171,888 0 0 -1,171,888
Foreign exchange differences -534,704 -57,672 -1,204 -593,580
Cost at 31
st
December 2022 1,679,992 3,076,716 1,179,716 5,936,424
Accumulated depreciation at 1
st
January 2022 -338,550 -2,258,794 -1,299,290 -3,896,634
Depreciation -35,068 -84,039 -29,603 -148,710
Depreciation reversals 446 349,070 221,865 571,381
Transfer 14,218 0 0 14,218
Foreign exchange differences 66,332 50,386 1,204 117,922
Accumulated depreciation at 31
st
December 2022 -292,622 -1,943,377 -1,105,824 -3,341,823
Net book value at 31
st
December 2022 1,387,370 1,133,339 73,892 2,594,601
Consolidated financial statements
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Note 6. Property, plant and equipment
EUR
Land and
nurseries Buildings
Technical
installations
Furniture,
vehicles and
others
Work in
progress
Advances
and prepay-
ments TOTAL
Cost at 1
st
January 2021
13,314,231 291,921,290 178,819,025 226,113,587 26,839,827 619,709 737,627,669
Additions (*)
1,587,433 7,749,688 24,107,099 11,596,992 9,760,923 91,363 54,893,498
Disposals
-24,592 -314,696 -866,410 -4,947,258 0 0 -6,152,956
Transfer
-2,096,502 14,077,448 4,630,072 2,167,189 -19,430,684 -60,031 -712,508
Foreign exchange differences
379,901 10,379,533 6,270,146 2,941,732 621,760 11,302 20,604,374
Cost at 31
st
December 2021
13,160,471 323,813,263 212,959,932 237,872,242 17,791,826 662,343 806,260,077
Accumulated depreciation at 1
st
January 2021
-1,183,132 -162,781,194 -105,746,304 -165,483,848 0 0 -435,194,478
Depreciation
-23,629 -11,773,048 -9,870,892 -16,401,901 0 0 -38,069,470
Depreciation reversals
10,437 715,773 840,778 4,407,507 0 0 5,974,495
Transfer
2,470 -191,384 2,768 -259,335 0 0 -445,481
Foreign exchange differences
-2,944 -5,300,500 -3,906,362 -2,519,835 0 0 -11,729,641
Accumulated depreciation at 31
st
December 2021
-1,196,798 -179,330,353 -118,680,012 -180,257,412 0 0 -479,464,575
Accumulated impairment at 1
st
January 2021
0 0 0 -5,338,533 0 0 -5,338,533
Impairment (**)
0 0 -1,728,058 -182,271 0 0 -1,910,329
Impairment reversal
0 0 0 3,133,349 0 0 3,133,349
Accumulated impairment at 31
st
December 2021
0 0 -1,728,058 -2,387,455 0 0 -4,115,513
Net book value at 31
st
December 2021
11,963,673 144,482,910 92,551,862 55,227,375 17,791,826 662,343 322,679,989
Cost at 1
st
January 2022
13,160,471 323,813,263 212,959,932 237,872,242 17,791,826 662,343 806,260,077
Additions (*)
1,307,378 7,265,938 17,785,161 13,927,535 12,637,721 8,156,462 61,080,195
Disposals
-814,455 -1,956,328 -730,891 -8,436,791 0 0 -11,938,465
Transfer
411,687 2,275,785 -4,958,284 17,957,479 -16,230,492 -316,007 -859,832
Foreign exchange differences
12,632 424,229 -4,779,210 -320,573 178,575 -62,363 -4,546,710
Cost at 31
st
December 2022
14,077,713 331,822,887 220,276,708 260,999,892 14,377,630 8,440,435 849,995,265
Accumulated depreciation at 1
st
January 2022
-1,196,798 -179,330,353 -118,680,012 -180,257,412 0 0 -479,464,575
Depreciation
-16,775 -13,812,619 -13,102,651 -14,221,686 0 0 -41,153,731
Depreciation reversals
22,946 1,949,306 620,400 7,360,966 0 0 9,953,618
Transfer
0 -1,736,377 9,176,617 -7,272,790 0 0 167,450
Foreign exchange differences
-2,805 568,395 1,738,956 -308,271 0 0 1,996,275
Accumulated depreciation at 31
st
December 2022
-1,193,432 -192,361,648 -120,246,690 -194,699,193 0 0 -508,500,963
Accumulated impairment at 1
st
January 2022
0 0 -1,728,058 -2,387,455 0 0 -4,115,513
Impairment (**)
0 -409,129 -403,478 0 0 0 -812,607
Impairment reversal
0 0 0 2,205,185 0 0 2,205,185
Accumulated impairment at 31
st
December 2022
0 -409,129 -2,131,536 -182,270 0 0 -2,722,935
Net book value at 31
st
December 2022
12,884,281 139,052,110 97,898,482 66,118,429 14,377,630 8,440,435 338,771,367
(*) Additions for the period include capitalised costs.
(**) Impairment test on property, plant and equipment is disclosed in Note 9.
On 31
st
December 2022, the Group has technical installations and professional equipment pledged as guarantees for borrowings of the Group for an
amount of EUR 8.1 million (2021: EUR 11 million). Details of these guarantees are provided in Note 32.
The accounting policies adopted for Property, plant and equipment are detailed under Notes 1 and 9.
Consolidated financial statements
Socfin
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Note 7. Biological assets
Palm Rubber Others TOTAL
EUR Mature Immature Mature Immature
Cost at 1
st
January 2021
410,644,908 21,231,834 203,967,857 98,392,847 7,131 734,244,577
Additions (*)
0 7,643,113 0 11,031,067 0 18,674,180
Disposals
-1,272,107 -528,813 -2,929,787 -803,228 0 -5,533,935
Transfer
10,558,817 -9,430,939 41,385,694 -41,246,637 0 1,266,935
Foreign exchange differences
14,573,822 1,005,994 9,651,895 4,114,786 0 29,346,497
Cost at 31
st
December 2021
434,505,440 19,921,189 252,075,659 71,488,835 7,131 777,998,254
Accumulated depreciation at 1
st
January 2021
-131,937,464 0 -70,125,468 0 -3,048 -202,065,980
Depreciation
-17,692,741 0 -6,584,164 0 -56 -24,276,961
Depreciation reversals
923,055 0 3,133,119 0 0 4,056,174
Transfer
-1,661,531 0 0 0 0 -1,661,531
Foreign exchange differences
-3,472,603 0 -2,488,179 0 0 -5,960,782
Accumulated depreciation at 31
st
December 2021
-153,841,284 0 -76,064,692 0 -3,104 -229,909,080
Accumulated impairment at 1
st
January 2021
-21,094,788 0 -15,507,554 -28,004,897 0 -64,607,239
Impairment (**)
-6,090,512 0 -201,978 0 0 -6,292,490
Impairment reversal
5,434,846 0 0 143,516 0 5,578,362
Transfer
0 0 -19,693,964 19,693,964 0 0
Foreign exchange differences
-1,078,241 0 -1,728,805 -1,104,096 0 -3,911,142
Accumulated impairment at 31
st
December 2021
-22,828,695 0 -37,132,301 -9,271,513 0 -69,232,509
Net book value at 31
st
December 2021
257,835,461 19,921,189 138,878,666 62,217,322 4,027 478,856,665
Cost at 1
st
January 2022
434,505,440 19,921,189 252,075,659 71,488,835 7,131 777,998,254
Additions (*)
0 9,038,860 0 6,708,384 0 15,747,244
Disposals
-8,567,446 -521,789 -5,519,885 -2,684,168 0 -17,293,288
Transfer (***)
10,645,515 -10,127,535 11,945,449 -17,861,891 0 -5,398,462
Foreign exchange differences
-3,985,217 -578,035 5,748,587 881,947 0 2,067,282
Cost at 31
st
December 2022
432,598,292 17,732,690 264,249,810 58,533,107 7,131 773,121,030
Accumulated depreciation at 1
st
January 2022
-153,841,284 0 -76,064,692 0 -3,104 -229,909,080
Depreciation
-18,869,674 0 -8,755,167 0 -56 -27,624,897
Depreciation reversals
8,384,373 0 4,907,080 0 0 13,291,453
Transfer (***)
-304,376 0 369,669 0 0 65,294
Foreign exchange differences
1,616,083 0 -1,240,360 0 0 375,723
Accumulated depreciation at 31
st
December 2022
-163,014,878 0 -80,783,470 0 -3,160 -243,801,508
Accumulated impairment at 1
st
January 2022
-22,828,695 0 -37,132,301 -9,271,513 0 -69,232,509
Impairment (**)
0 0 -27,341,960 -182,149 0 -27,524,109
Impairment reversal
0 0 386,164 1,268,463 0 1,654,627
Transfer (***)
0 0 300,553 5,724,995 0 6,025,548
Foreign exchange differences
-761,413 0 -1,049,535 -343,317 0 -2,154,265
Accumulated impairment at 31
st
December 2022
-23,590,108 0 -64,837,079 -2,803,521 0 -91,230,708
Net book value at 31
st
December 2022
245,993,306 17,732,690 118,629,261 55,729,586 3,971 438,088,814
(*) Additions for the period include capitalised costs.
(**) Impairment test on biological assets is disclosed in Note 9.
(***) During previous periods, a positive revaluation for EUR 5.8 million and an impairment for EUR 6.0 million had been booked on biological assets on
the Cambodian segment. Those adjustments having no significant net impact, they were cancelled in the current year.
On 31
st
December 2022, the Group has biological assets pledged as guarantees for borrowings of the Group for an amount of EUR nil (2021: EUR 13 million).
Details of these guarantees are provided in Note 32.
Accounting policy regarding current biological assets is disclosed in note 1.13.
Consolidated financial statements
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Note 8. Depreciation and impairment
2022 2021
EUR EUR
Depreciation
Of intangible assets (Note 5) 148,710 393,938
Of property, plant and equipment excluding biological assets (Note 6) 41,153,732 38,069,470
Of biological assets (Note 7) 27,624,896 24,276,961
Of investment properties (Note 10) 225,478 235,077
Of right-of-use assets (Note 4) 2,246,498 2,030,216
Impairment
Of property, plant and equipment excluding biological assets (Note 6) 812,607 1,910,329
Of biological assets (Note 7) 27,524,109 6,292,490
Impairment reversal
Of property, plant and equipment excluding biological assets (Note 6) -2,205,185 -3,133,349
Of biological assets (Note 7) -1,654,627 -5,578,362
TOTAL 95,876,218 64,496,770
Note 9. Impairment of assets
Goodwill
Impairment tests on goodwill are performed at least
once a year to assess whether the carrying amount is
still appropriate.
Intangible and tangible assets and right-of-use
of assets
At each reporting date, the Group reviews the carrying
amount of its intangible and tangible assets and right-
of-use assets in order to assess whether there is any
indication of impairment.
If such indication exists, the recoverable amount of
the asset is estimated to determine the amount of the
impairment loss.
At 31
st
December 2022, an impairment loss of
EUR 0.8 million was recognised (2021: EUR 1.9 million)
and an impairment reversal for 2.2 million was
recognised on property, plant and equipment (2021:
impairment reversal for EUR 3.1 million)
Bearer biological assets
At each reporting date, the Group assesses if there
is any indication that its biological assets may be
impaired.
For this purpose, the Group assesses several indicators:
The significant and sustained decreasing trend in the
prices of natural rubber (TSR20 1
st
position on SGX)
and crude palm oil (CIF Rotterdam) was considered
an observable sign that the biological assets may have
been impaired. A decrease in these prices at reporting
date greater than 15% compared to an average of
5-year value has been set by the Group to be an
impairment indicator.
At 31
st
December 2022, the decrease in prices does
not exceed 15% of the average price over the past 5
years for the Rubber and Palm segment.
The Group considers, as well, average prices over the
six months before reporting date and average prices
over the last twelve months instead of only closing
prices to avoid seasonal fluctuations in the prices of
supply materials.
Consolidated financial statements
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The Group reviews also the prices observed on local
market and considers a decrease in these prices at the
closing date of more than 15% compared to an average
of values over 5 years as an impairment indicator.
Based on these criteria, for the Rubber segment, the
rise in prices observed during the financial year 2022
does not exceed 15% of the average prices over the
past 5 years. For the Palm segment, the review of
global and local prices do not indicate any impairment
indicator.
In addition to these external indicators, the Group
considers the following indicators:
- Internal performance indicators;
- Criteria relating to the local market;
- Physical indicators of impairment;
- Significant changes in plantations that could have a
material impact on their future cash flows.
The review of impairment indicators led the Group
to conclude that a sign of impairment exists for
Coviphama and Socfin KCD.
If an indication of impairment is identified, the
recoverable amount of the bearer biological assets is
determined.
Impairment tests must be performed on the smallest
identifiable group of assets which generates cash flows
independently of other assets or groups of assets and
for which the Group prepares financial information for
the Board of Directors.
The identification of Cash Generating Units (CGUs)
depends, in particular, on:
- how the Group manages the activities of the entity;
- the way in which decisions are made with regards to
the pursuit or the disposal of its activities and;
- the existence of an active market for all or part of
the production.
The Group considers the political and country specific
risk factors while reviewing business evolution.
Therefore, companies are grouped within the CGU
country.
The recoverable amount of bearer biological assets is
determined from the calculation of value in use using
the most recent information approved by the local
management. The Group uses the discounted value
of expected net cash flows which are discounted
at a pre-tax rate. At reporting date, the financial
projection incorporates the full exploitation of the
younger bearer biological assets. The operational life
ranges between 25 and 30 years for both crops. This
period can be adapted according to the particular
circumstances for each entity.
The value in use calculation has been very sensitive to:
- changes in the margins achieved by the entity and,
- changes related to the discount rate.
Changes in realised margins
Initially, the Group determines separately the expected
production of each category of bearer biological
assets within the entity over their remaining life.
This expected production is estimated on the basis
of the surface areas planted at reporting date as well
as the actual crop yield recorded during the financial
year which depends on the maturity of the bearer
biological asset. Production is then valued on average
basis of five-year of the margins achieved by the entity
in relation to the agricultural activity. The value in
use of the bearer biological asset is then obtained
by discounting these cash flows. Average margins are
considered constant over the duration of the financial
projection. No indexing factor is considered.
Based on the existence of an impairment indication
and following subsequent impairment tests, using
a discount rate of 17.3% for Cambodia in 2022,
impairment losses of EUR 18.9 million for Socfin
KCD and EUR 8.4 million for Coviphama have been
accounted for in 2022 (Note 7), the recoverable
amounts for these biological assets being respectively
14.1 million and 10.5 million.
As of 31
st
December 2022, accumulated impairment
losses in the palm business segment amounted to
EUR 9.9 million for Brabanta, EUR 9.2 million for
Agripalma and EUR 4.5 million for Socfin Agricultural
Company. For the Rubber segment, the accumulated
impairment losses are EUR 30.8 million for SRC,
EUR 18.6 million for Socfin KCD, EUR 8.6 million
for Safacam, EUR 8.3 million for Coviphama, and
EUR 1.4 million for PSG (Note 7), the recoverable
amounts for these biological assets being respectively
14.1 million and 10.5 million.
Consolidated financial statements
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Note 10. Investment properties
EUR
Cost at 1
st
January 2021 9,856,602
Additions 36,504
Cost at 31
st
December 2021 9,893,106
Accumulated depreciation at 1
st
January 2021 -5,797,247
Depreciation -273,940
Depreciation reversals 38,863
Accumulated depreciation at 31
st
December 2021 -6,032,324
Net book value at 31
st
December 2021 3,860,782
Cost at 1
st
January 2022 9,893,106
Additions 34,782
Cost at 31
st
December 2022 9,927,888
Accumulated depreciation at 1
st
January 2022 -6,032,324
Depreciation -225,478
Accumulated depreciation at 31
st
December 2022 -6,257,802
Net book value at 31
st
December 2022 3,670,086
The leases are in the form of a 9-year renewable
lease. Premises rented of the Champ de Mars building
generated rental income of EUR 0.6 million (2021:
EUR 0.5 million). The direct operating expenses
incurred by this property amounted to EUR 0.4 million
(2021: EUR 0.3 million).
The 1
st
and 4
th
floors of the building located at 2,
Place du Champ de Mars, in Brussels were revalued
by an independent appraiser during the acquisition of
Immobilière de la Pépinière in December 2006. This
value was used as deemed cost under IFRS 1 (first-
time application).
As of 31
st
December 2020, the fair value of the Ground
floor, as well as the 1
st
and 4
th
floors of the building
amounts, has been estimated by an independent
assessor to EUR 4.2 million.
Consolidated financial statements
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Note 11. Non-wholly owned subsidiaries in which non-controlling interests
are significant
Interests of non-controlling interests in the activities of the Group
Subsidiary Main location
Percentage of equity shares of
non-controlling interest
Percentage of voting rights of
non-controlling interests
2022 2021 2022 2021
Production of palm oil and rubber
SOGB Côte d’Ivoire 58.83% 58.91% 26.84% 26.84%
OKOMU Nigeria 57.10% 57.92% 33.62% 34.77%
SAFACAM
Cameroon 55.37% 55.45% 30.95% 30.95%
SOCAPALM Cameroon 56.40% 56.48% 32.54% 32.54%
SOCFINDO Indonesia 47.57% 47.72% 10.00% 10.00%
Production of rubber
LAC Liberia 35.36% 35.49% 0.00% 0.00%
Investment portfolio management
SOCFINASIA Luxembourg 41.75% 41.91% 41.75% 41.91%
SOCFINAF Luxembourg 35.36% 35.49% 35.36% 35.49%
Subsidiary
Net income attributed to
non-controlling interests in
the subsidiary during the
financial period
Accumulated non-controlling
interests in the subsidiary
2022 2021 2022 2021
EUR EUR EUR EUR
SOGB 16,073,618 13,862,660 65,338,576 60,992,515
OKOMU 23,748,625 17,944,616 55,159,283 54,513,137
SAFACAM 1,399,945 2,599,692 24,635,112 25,361,064
SOCAPALM 10,176,916 12,653,924 48,821,644 54,565,923
SOCFINDO 34,766,880 28,637,531 26,499,209 27,904,720
LAC 1,175,888 2,079,176 14,175,710 11,681,836
SOCFINASIA 1,417,674 1,986,846 69,185,844 67,898,023
SOCFINAF -8,941,567 -6,210,608 33,510,966 23,575,883
Subsidiaries that hold non-controlling interests that are not significant individually 40,482,324 30,161,006
Non-controlling interests 377,808,668 356,654,107
Consolidated financial statements
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Summary financial information concerning subsidiaries whose interests of non-controlling interests are
significant for the Group excluding intragroup eliminations
Subsidiary Current assets
Non-current
assets
Current
liabilities
Non-current
liabilities
2021 EUR EUR EUR EUR
SOGB 47,069,842 100,818,900 36,697,511 10,223,275
OKOMU 33,527,881 106,235,499 16,119,871 39,330,460
SAFACAM 14,000,204 34,504,233 10,924,741 5,404,975
SOCAPALM 26,800,996 109,893,878 25,202,975 3,069,977
SOCFINDO 48,455,059 91,150,642 37,997,748 36,912,343
LAC 17,920,859 75,090,781 14,696,615 27,864,293
SOCFINASIA 41,424,023 410,964,167 5,117,423 0
SOCFINAF 29,901,483 504,633,199 53,964,692 186,463,935
2022 EUR EUR EUR EUR
SOGB 46,841,347 98,190,002 -31,411,643 6,768,082
OKOMU 28,642,085 116,727,370 19,373,135 38,262,602
SAFACAM 12,578,738 33,387,449 9,541,067 3,840,819
SOCAPALM 31,652,073 113,564,581 37,057,322 7,186,191
SOCFINDO 36,446,379 91,330,388 33,993,571 34,304,495
LAC 22,116,139 78,750,441 15,173,372 28,673,339
SOCFINASIA 52,028,834 405,667,839 5,552,442 0
SOCFINAF 36,675,973 361,924,445 57,346,716 120,000,000
Consolidated financial statements
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Subsidiary
Revenue from
ordinary
activities
Net income for
the year
Comprehensive
income for the
year
Dividends
paid to non-
controlling
interests
2021 EUR EUR EUR EUR
SOGB 126,645,632 22,453,119 22,453,119 2,455,221
OKOMU 79,363,158 23,976,881 23,976,881 5,234,727
SAFACAM 32,790,020 3,778,438 3,778,438 33
SOCAPALM 114,731,158 20,617,398 20,617,398 8,682,053
SOCFINDO 160,251,333 64,841,457 64,841,457 5,499,223
LAC 36,783,462 4,018,160 4,018,160 0
SOCFINASIA 0 44,023,278 44,023,278 7,390,739
SOCFINAF 0 5,522,213 5,522,213 0
2022 EUR EUR EUR EUR
SOGB 143,125,135 23,862,820 23,862,820 5,321,013
OKOMU 133,279,823 38,962,980 38,962,980 13,683,296
SAFACAM 35,405,879 4,188,838 4,188,838 1,177,658
SOCAPALM 112,851,693 16,268,753 16,268,753 7,717,380
SOCFINDO 193,795,921 71,954,260 71,954,260 7,524,578
LAC 40,756,657 3,508,835 3,508,835 0
SOCFINASIA 0 70,684,907 70,684,907 24,569,808
SOCFINAF 0 -37,542,749 -37,542,749 0
Consolidated financial statements
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Net cash inflows (outflows)
Net cash inflows
(outflows)Subsidiary
Operating
activities
Investing
activities
Financing
activities
2021 EUR EUR EUR EUR
SOGB 14,435,766 -9,570,729 -12,136,117 -7,271,080
OKOMU 49,550,771 -28,715,135 -10,902,826 9,932,810
SAFACAM 2,315,684 -2,647,396 337,688 5,976
SOCAPALM 30,591,306 -9,720,446 -30,342,263 -9,471,402
SOCFINDO 71,784,807 -9,573,215 -54,992,234 7,219,358
LAC 5,539,703 -3,957,347 -1,826,500 -244,144
SOCFINASIA 41,877,748 4,456,133 -19,251,988 27,081,893
SOCFINAF -1,381,090 32,619,156 -21,502,408 9,735,658
2022 EUR EUR EUR EUR
SOGB 46,841,347 -8,339,224 -31,411,643 7,090,479
OKOMU 50,558,570 -22,109,292 -37,698,943 -9,249,665
SAFACAM 8,426,402 -2,316,652 -6,346,027 -236,277
SOCAPALM 28,473,548 -10,987,793 -17,619,574 -133,819
SOCFINDO 78,446,226 -12,561,950 -75,245,783 -9,361,507
LAC 3,320,791 -2,627,891 0 692,900
SOCFINASIA 73,747,907 2,994,820 -65,656,710 11,086,017
SOCFINAF 26,451,606 22,249,770 -56,722,228 -8,020,852
The nature and evolution of the risks associated with
the interests held by the Group in the subsidiaries
remained stable over the financial period compared
to the previous year.
Note 12. Financial assets at fair value through other comprehensive income
2022 2021
EUR EUR
Fair value at 1
st
January 715,578 847,018
Change in fair value (*) -27,554 -36,378
Disposals 0 -95,062
Fair value at 31
st
December 688,024 715,578
(*) The variation in the fair value of the financial assets is accounted under the Other Comprehensive Income.
EUR Cost (historical) Fair value
2022 2021 2022 2021
Financial assets at fair value through other
comprehensive income
600,118 600,118 688,024 715,578
Consolidated financial statements
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Note 13. Deferred taxes
* Components of deferred tax assets and liabilities
2022 2021
EUR EUR
IAS 2 / IAS 41: Agricultural production -4,731,573 -3,299,090
IAS 12: Income Tax (*) -4,696,048 -221,701
IAS 16: Property, plant and equipment -6,760,108 -7,100,792
IAS 19: Pension obligations 10,956,040 10,443,059
IAS 21: Translation differences 46,624 -68,147
IAS 37: Provisions for risks and charges 426,163 -27,097
IAS 38: Formation expenses 516,393 513,557
IAS 38: Research costs 935,670 832,888
IFRS 9: Financial assets measured at fair value through other
comprehensive income
-109,204 -74,277
IFRS 9: Forward exchange contract -255,132 141,681
IFRS 16: Leases 719,833 583,960
IAS 23: Capitalised interests 347,960 335,675
IFRS 3: Fair value of investment property -16,580 -15,614
Others -4,114 448,853
Balance at 31
st
December -2,624,076 2,492,955
Of which Deferred Tax Assets 11,698,485 19,434,382
Of which Deferred Tax Liabilities -14,322,562 -16,941,425
(*) Of which EUR 4.1 million of deferred tax asset linked to losses carried forward activated, and EUR 8.8 million of deferred
tax liability linked to withholding tax.
The above deferred taxes are presented per category
of deferred taxes resulting from consolidation
adjustments. They are calculated company per
company and the net position between deferred tax
liabilities and deferred tax assets is presented.
* Contingent tax assets and liabilities
Some of the subsidiaries have accumulated tax losses
that are limited or not over time or capital allowances
limited or not over time.
Brabanta, SRC, Socfin KCD, Agripalma, Immobilière
de la Pépinière, Coviphama and Camseeds have
unused tax losses which recoverability is uncertain of
EUR 21.4 million, EUR 20.3 million, EUR 8.7 million,
EUR 4.6 million, EUR 2.7 million, EUR 2.2 million and
EUR 1.1 million respectively as at 31
st
December 2022.
Socfinaf has unused tax losses of EUR 211.4 million, PNS
Ltd of EUR 15.1 million and Socfin of EUR 10.5 million.
Due to the instability which may exist in these countries
with regard to the evolution of tax legislation or its
application, no deferred tax assets have been booked
related to these tax losses.
Consolidated financial statements
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Note 14. Current tax assets and liabilities
* Components of current tax assets
2022 2021
EUR EUR
Current tax assets at 1
st
January 15,291,971 14,317,805
Tax income 1,504,864 314,436
Other taxes (*) -1,708,373 -1,986,417
Taxes paid or recovered 2,628,666 2,082,439
Tax adjustments -3,039,355 134,416
Scope exits -4,719 0
Foreign exchange differences 269,395 429,292
Current tax assets at 31
st
December 14,942,449 15,291,971
* Components of current tax liabilities
2022 2021
EUR EUR
Current tax liabilities at 1
st
January 48,328,464 32,208,682
Tax expense 73,278,655 55,230,723
Other taxes (*) 22,682,424 37,523,894
Taxes paid or recovered -86,029,666 -71,033,459
Tax adjustments -1,155,592 -6,388,250
Foreign exchange differences -283,948 786,874
Current tax liabilities at 31
st
December 56,820,337 48,328,464
(*) Other taxes are composed of taxes not enclosed in general tax expenses: VAT, witholding tax, custom tax, ...
Consolidated financial statements
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Note 15. Income tax expense
* Components of the income tax
2022 2021
EUR EUR
Current income tax expense (*) 71,319,742 53,538,854
Deferred tax expense / (income) 4,936,022 840,121
Tax expense at 31
st
December 76,255,764 54,378,975
(*) Withholding tax on dividends is presented within income tax expense.
* Components of the deferred tax expense / (income)
2022 2021
EUR EUR
IAS 12: Income Tax (*) 2,275,153 -2,128,714
IAS 19: Pension obligations -1,415,185 -210,557
IAS 38: Intangible assets -73,140 599,504
IAS 2 / IAS 41: Fair value of agricultural produce 1,483,247 1,851,884
IFRS 9: Forward exchange contracts 412,526 -175,964
IFRS 9: Fair value 44,201 0
IAS 16: Tangible assets 2,378,189 1,470,442
IFRS 16: Leases -31,084 -15,667
IAS 37: Provisions for risks and charges -267,461 -117,893
IAS 21: Foreign exchange differences -117,856 81,915
IAS 23: Capitalised interests 8,638 -344,950
Others 238,796 -169,879
Deferred tax expense / (income) at 31
st
December 4,936,024 840,121
(*) Of which impact of losses carried forward activated for EUR 4.2 million, and withholding tax for EUR -2.4 million.
Consolidated financial statements
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* Reconciliation of income tax expense
2022 2021
EUR EUR
Profit before tax from continuing operations 240,610,894 220,921,900
Nominal tax rate of the parent company
24.94% 24.94%
Nominal tax rate of subsidiaries
from 1% to 33% from 1% to 33%
Income tax at nominal tax rates of subsidiaries
53,451,880 48,036,580
Unfunded taxes
41,281 1,359
Definitively taxed income
653,221 2,063,933
Use unrecognised of capital allowances
-3,727,262 -11,285,390
Specific tax regimes in foreign countries
14,241,642 20,696,496
Non-taxable income
-4,125,468 -6,428,348
Non-deductible expenses
12,391,601 6,932,239
Use of unrecognised accumulated tax losses
-1,413,647 -13,417,994
Unrecognised losses carried forward
4,605,716 6,356,042
Other tax benefits
-40,956 -91,063
Additional tax assessment
36,742 23,775
Impact of change in tax rate
143,873 1,493,435
Other adjustments
-2,859 -2,089
Tax expense at 31
st
December
76,255,764 54,378,975
* Change of rate for the subsidiaries
Since 2021, companies listed in Cameroon are eligible
for a reduced tax rate of 27.5%.
In 2021, the income tax rate for Socfindo has dropped
from 25% to 22%. In 2022, the income tax rate for
Socfindo should have dropped from 22% to 20%, but as
tax project has been cancelled at local level, an income
tax rate of 22% has been used in the computation of
the deferred taxes as of 31
st
December 2022.
Consolidated financial statements
Socfin
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Note 16. Inventories
* Carrying value of inventories by category
31/12/2022 31/12/2021
EUR EUR
Raw materials 34,379,009 28,158,214
Consumables 26,481,895 21,817,225
Spare parts 34,226,019 28,075,902
Production in progress 3,329,146 1,873,597
Finished products 31,976,663 37,191,567
Down-payments and orders in progress 4,400,098 2,037,012
Gross amount (before impairment) at 31
st
December 134,792,830 119,153,517
Inventory write-downs -6,121,259 -4,647,661
Net amount at 31
st
December 128,671,571 114,505,856
* Reconciliation of inventories
2022 2021
EUR EUR
Situation at 1
st
January 119,153,517 106,022,644
Change in inventory 8,667,796 6,821,365
Fair value of agricultural products 6,870,293 3,227,540
Foreign exchange differences 101,224 3,081,968
Gross amount (before impairment) at 31
st
December 134,792,830 119,153,517
Inventory write-downs -6,121,259 -4,647,661
Net amount at 31
st
December 128,671,571 114,505,856
* Quantity of inventory by category
31/12/2021 Raw materials Production-in-progress Finished goods
Crude Palm Oil / Palm Kernel Oil (tons) 1,346 0 15,980
Rubber (tons) 31,684 0 16,530
Others (units) 0 4,737,950 2,909,556
31/12/2022 Raw materials Production-in-progress Finished goods
Crude Palm Oil / Palm Kernel Oil (tons) 667 0 11,947
Rubber (tons) 34,170 0 12,391
Others (units) 0 10,043,350 2,150,187
Consolidated financial statements
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Note 17. Trade receivables (current assets)
31/12/2022 31/12/2021
EUR EUR
Trade receivables 31,611,721 37,632,950
Advances and prepayments 5,255,396 4,449,841
TOTAL 36,867,117 42,082,791
Note 18. Other receivables (current assets)
31/12/2022 31/12/2021
EUR EUR
Social security 1,026,966 1,259,723
Other receivables (*) 5,870,957 6,822,949
Accrued charges 1,767,210 2,155,468
TOTAL 8,665,133 10,238,140
(*) Other receivables include receivables linked to non-operational activities
The accounting principles applied and the risk management for other receivables are detailed under Notes
1 and 34.
Consolidated financial statements
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Note 19. Cash and cash equivalents
* Reconciliation with the amounts in the financial statements
31/12/2022 31/12/2021
EUR EUR
Current account 178,560,956 144,315,004
Financial instruments (*) 1,761,337 -999,569
TOTAL
180,322,293 143,315,435
(*) The financial instruments correspond to the value of the forward exchange contracts at 2022 year-end.
* Reconciliation with the cash flow statement
31/12/2022 31/12/2021
EUR EUR
Current account 178,560,956 144,315,004
Bank overdrafts (*) -10,695,901 -7,029,326
TOTAL
167,865,055 137,285,678
(*) See also Note 23.
Note 20. Share capital and share premium
Issued and fully paid capital amounted to
EUR 24.8 million as of 31
st
December 2022 (stable
compared to 2021). There is a share premium of
EUR 0.5 million added to the issued capital.
In accordance with the law of 28
th
July 2014 regarding
immobilisation of bearer shares, 80,280 shares have
been cancelled in 2018.
Compensation for cancelled shares can be obtained at
the company statutory head office.
At 31
st
December 2022, the Company’s share capital is
represented by 14,159,720 shares.
2022 2021
Ordinary shares Ordinary shares
Number of Shares at 31
st
December 14,159,720 14,159,720
Number of fully paid shares issued without designation of par value
14,159,720 14,159,720
Note 21. Legal reserve
In accordance with Luxembourg commercial law, the
company is required to allocate a minimum of 5% of
its net profit for each financial year to a legal reserve.
This requirement ceases to be necessary once the
balance on the legal reserve reaches 10% of the issued
share capital. The legal reserve is not available for
distribution to the shareholders.
Consolidated financial statements
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Note 22. Pension obligations
Defined benefit pension plan and post-employment sickness
The Group provides a defined benefit pension plan to its
employees in its Indonesian subsidiary. The latter pay benefits
which are payable in the event of retirement or voluntary
resignation. The benefits paid are calculated as a percentage of
salary and are based on the number of years of service. The plan
is based on the employment contract for the employees and on
the collective agreements for the labourers. The benefits payable
to the employees are not financed by any specific asset against
the provisions.
Apart from the local applicable social security provisions, most
of the Group’s employees in Africa benefit from a defined benefit
pension plan. The subsidiaries pay benefits which are payable in
the event of retirement and in case of dismissal in some countries.
Allowances paid are expressed as a percentage of salary and are
based on the number of years of service. The plans are governed
by the local collective agreements in force in each country.
Excepted in Cameroon and Switzerland, the benefits payable to
the employees are not financed by a specific asset in return for
provisions.
2022 2021
EUR EUR
Present value
of
obligations
Fair value of
the benefit
plans
Net
amount
recognised
Present value
of
obligations
Fair value of
the benefit
plans
Net
amount
recognised
Net amount recognised in the statement of
financial position for defined benefit plans
55,754,461 -8,176,424 47,578,037 59,869,569 -8,861,208 51,008,361
Components of net charge
Current service costs 3,615,375 3,615,375 3,933,744 3,933,744
Financial costs 3,011,609 23,422 3,035,031 2,802,324 3,706 2,806,030
Interest income on plan assets -142,018 -142,018 -106,422 -106,422
Past service costs -56,735 -56,735 -737,574 -737,574
Defined benefit plan costs 6,570,249 -118,596 6,451,653 5,998,494 -102,716 5,895,778
Movements in liabilities / net assets recognised in the statement of financial position
At 1
st
January 59,869,574 -8,861,195 51,008,379 62,078,977 -11,150,694 50,928,284
Costs as per income statement 6,570,249 -118,596 6,451,653 5,998,494 -102,716 5,895,778
Contributions by employer -4,759,538 -1,554,724 -6,314,262 -5,342,291 -1,459,704 -6,801,994
Contributions by employees 919,272 -919,272 0 987,406 -987,406 0
Costs of services rendered -2,734,502 2,734,502 0 -5,034,135 5,034,135 0
Actuarial gains and losses of the year recognised
in other comprehensive income
-3,488,286 5,774 -3,482,512 -1,901,145 27,031 -1,874,114
Reclassification of net asset 877,478 877,478 91,967 91,967
Foreign exchange differences -622,304 -340,380 -962,684 3,082,267 -313,808 2,768,459
At 31
st
December 55,754,466 -8,176,414 47,578,052 59,869,574 -8,861,195 51,008,379
Provisions are based on actuarial valuation reports prepared in January 2023.
Consolidated financial statements
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Actuarial gains and losses recognised in other comprehensive income
2022 2021
EUR EUR
Present value
of
obligations
Fair value of
the benefit
plans
Net
amount
recognised
Present value
of
obligations
Fair value of
the benefit
plans
Net
amount
recognised
Adjustments of liabilities related to experience -208,413 -208,413 -2,379,550 -2,379,550
Changes in financial assumptions related to
recognised liabilities
3,925,112 3,925,112 4,302,011 4,302,011
Changes in demographic assumptions related to
recognised liabilities
-228,414 -228,414 -21,314 -21,314
Return on assets in the plan excl. interest income -5,774
-5,774
-27,031 -27,031
Actuarial gains and losses recognised during
the period in other comprehensive income
3,488,285 -5,774 3,482,511 1,901,147 -27,031 1,874,116
Asset plan
In Cameroon and Switzerland, defined benefit obligations are
partially covered by plan assets. Subsidiaries contribute each
year to these plan assets. Benefits are paid when and only if
employees retire.
The plan assets are managed by third parties, earning each year
financial interests for a global amount of EUR 0.1 million during
2022 financial period.
Actuarial valuation assumptions
2022 2021
EUROPE
Average discount rate 2.30% 0.35%
Expected long-term returns of plan assets 154,964 0
Future salary increases 1.50% 1.50%
Average remaining active life of employees (in years) 8.93 8.83
AFRICA
Average discount rate from 4.93% to 18.48% from 2.63% to 12.61%
Expected long-term returns of plan assets 170,158 N/A
Future salary increases from 1.74% to 12% from 1.74% to 12%
Average remaining active life of employees (in years) 19.34 19.50
ASIA
Average discount rate from 5.52% to 7.44% from 3.40% to 7.60%
Expected long-term returns of plan assets N/A N/A
Future salary increases 6.50% 6.50%
Average remaining active life of employees (in years) 13.10 12.96
Consolidated financial statements
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Sensitivity analysis of the actuarial value of defined benefit obligations
2022 2021
EUR EUR
EUROPE
Actuarial value of the obligation
- Pension plan
7,760,804 9,189,042
- Fair value of plan assets -6,853,790 -7,147,529
Total at 31
st
December 907,014 2,041,513
Actuarial rate (on pension plan)
Increase of 0.5% 7,313,114 8,637,612
Decrease of 0.5% 8,269,218 9,828,001
Expected future salary increases (on pension plan)
Increase of 0.5% 7,817,510 9,257,387
Decrease of 0.5% 7,707,019 9,124,108
AFRICA
Actuarial value of the obligation
- Pension plan 13,689,169 13,768,201
- Fair value of plan assets -1,322,634 -1,713,679
Total at 31
st
December 12,366,535 12,054,522
Actuarial rate (on pension plan)
Increase of 0.5% 13,285,487 13,316,089
Decrease of 0.5% 14,093,019 14,228,460
Expected future salary increases (on pension plan)
Increase of 0.5% 14,067,916 14,197,217
Decrease of 0.5% 13,306,104 13,341,712
ASIA
Actuarial value of the obligation
- Pension plan 32,563,604 35,065,614
- Other long-term benefits 1,740,884 1,846,712
Total at 31
st
December 34,304,488 36,912,326
Actuarial rate (on pension plan)
Increase of 0.5% 33,188,601 35,702,753
Decrease of 0.5% 35,486,229 38,247,974
Expected future salary increases (on pension plan)
Increase of 0.5% 35,408,582 38,104,204
Decrease of 0.5% 33,252,768 35,777,001
The sensitivity analysis is based on the same actuarial method used to measure the obligations of the defined
benefit plans.
Consolidated financial statements
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Impact of the defined benefit pension plan on future cash flows
2023 2022
Estimated contributions for the next financial year (in euros) 5,034,050 5,991,897
2022 2021
Weighted average duration of defined benefit plan obligations (in years)
EUROPE 6.5 5.9
AFRICA 6.2 6.7
ASIA 12.8 12.8
Defined contribution pension scheme
EUR 2022 2021
Accounted expense for the defined contribution pension plan 3,375,907 2,959,855
Note 23. Financial debts
31/12/2021
EUR < 1 year > 1 year TOTAL
Loans held by financial institutions (1) 26,009,954 125,924,854 151,934,808
Bank overdrafts (2) 7,029,326 0 7,029,326
Other loans 5,394,086 0 5,394,086
Lease liabilities 1,401,018 10,977,780 12,378,798
TOTAL 39,834,384 136,902,634 176,737,018
31/12/2022
EUR < 1 year > 1 year TOTAL
Loans held by financial institutions (1) 39,525,552 47,637,646 87,163,198
Bank overdrafts (2) 10,695,901 0 10,695,901
Other loans 839,517 0 839,517
Lease liabilities 1,836,468 11,087,026 12,923,494
TOTAL 52,897,438 58,724,672 111,622,110
(1) In November 2021, a loan of USD 100 million has been granted to PNS Ltd at a floating rate of 3-month LIBOR + 5%. In 2022,
an amount of USD 70 million has been early reimbursed by PNS Ltd. The remaining balance (USD 30 million) has been fully
repaid by PNS Ltd in February 2023 (see also note 37).
(2) See also Note 19.
Consolidated financial statements
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Most of the consolidated borrowings are denominated
in US Dollars and in Euros or CFA francs (whose parity
is linked to the Euro). The fixed interest rates from
financial institutions and which are pegged to the
Euro vary between 5.00% and 7.09%. As explained in
Note 34, interest rate management is the subject of
ongoing management attention.
The company is in compliance with covenants related
to amounts owed to credit institutions.
* Analysis of long-term debt by interest rate
31/12/2021
EUR Fixed Rate Rate Floating rate Rate TOTAL
Loans held by financial institutions
Luxembourg 0 0.00% 78,136,408
3-month
LIBOR + 5%
78,136,408
Switzerland 5,498,015 1.55% to 2.65% 0 - 5,498,015
Côte d’Ivoire 6,940,137 5.50% to 6.50% 0 - 6,940,137
Nigeria 18,203,287 5.00% to 10.00% 0 - 18,203,287
Liberia 2,462,387 7.60% 0 - 2,462,387
Cameroon 6,559,619 5.75% to 6.80% 0 - 6,559,619
Ghana 8,125,000 4.00% 0 - 8,125,000
47,788,445 78,136,408 125,924,853
31/12/2022
EUR Fixed Rate Rate Floating rate Rate TOTAL
Loans held by financial institutions
Luxembourg 0 0.00% 9,375,586
3-month
SOFR + 5%
9,375,586
Switzerland 3,655,936 1.55% to 2.65% 0 - 3,655,936
Côte d’Ivoire 2,647,566 5.50% to 6.50% 0 - 2,647,566
Nigeria 17,197,310 5.00% to 10.00% 0 - 17,197,310
Liberia 1,699,592 7.60% 0 - 1,699,592
Cameroon 8,186,656 5.00% to 7.09% 0 - 8,186,656
Ghana 4,874,999 4.00% 0 - 4,874,999
38,262,059 9,375,586 47,637,645
Consolidated financial statements
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* Long-term debts analysis by currency
2021 EUR XAF NGN USD STN GHS CDF CHF TOTAL EUR
Loans held by financial
institutions
8,125,000 13,499,756 18,203,287 80,598,795 0 0 0 5,498,015 125,924,853
Lease liabilities
0
6,497,068 271,450 1,707,099 289,187 47,996
38,072
2,126,905 10,977,777
TOTAL
8,125,000 19,996,824 18,474,737 82,305,894
289,187
47,996 38,072 7,624,920 136,902,630
2022 EUR XAF NGN USD STN GHS CDF CHF TOTAL EUR
Loans held by financial
institutions
4,874,999 10,834,222 17,197,310 11,075,178 0 0 0 3,655,936 47,637,645
Lease liabilities
0 7,039,341 65,318 1,762,701 268,436 35,690 38,702 1,876,836 11,087,024
TOTAL
4,874,999 17,873,563 17,262,628 12,837,879 268,436 35,690 38,702 5,532,772 58,724,669
* Long-term debt analysis by maturity
2021
EUR 2023 2024 2025 2026
2027 and above
TOTAL
Loans held by financial institutions
35,417,051 73,334,985 6,866,072 3,669,989 6,636,756 125,924,853
Lease liabilities
1,182,686 837,648 461,869 421,973 8,073,603 10,977,779
TOTAL
36,599,737 74,172,633 7,327,941 4,091,962 14,710,359 136,902,632
2022
EUR 2024 2025 2026 2027
2028 and above
TOTAL
Loans held by financial institutions
25,376,903 9,246,072 4,539,071 3,950,392 4,525,209 47,637,647
Lease liabilities
1,532,263 917,067 597,085 399,223 7,641,387 11,087,025
TOTAL
26,909,166 10,163,139 5,136,156 4,349,615 12,166,596 58,724,672
Consolidated financial statements
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* Net cash surplus / (Net debt)
31/12/2022 31/12/2021
EUR EUR
Cash and cash equivalents 180,322,293 143,315,435
Long-term debt net of current portion -47,637,646 -125,924,855
Short-term debt and current portion of long-term debt -51,060,969 -38,433,365
Lease liabilities -12,923,494 -12,378,798
Net cash surplus / (Net debt) 68,700,184 -33,421,583
Cash and cash equivalents 180,322,293 143,315,435
Loan bearing interest at a fixed rate -70,800,953 -86,221,763
Loan bearing interest at a variable rate -27,897,662 -78,136,456
Lease liabilities -12,923,494 -12,378,798
Net cash surplus / (Net debt) 68,700,184 -33,421,582
* Reconciliation of net cash surplus / (net debt)
EUR
Cash and cash
equivalents
Long term debt,
net of current
portion
Short term debt
and current
portion of long
term debt
Debt related to
leases
TOTAL
At 1
st
January 2021 58,911,453 -55,059,230 -151,251,825 -12,704,250 -160,103,852
Cash flows 81,898,296 -91,241,325 140,332,355 1,883,386 132,872,712
Foreign exchange differences 2,889,122 -4,048,158 -804,852 -133,211 -2,097,099
Transfers -215,853 24,423,858 -26,709,044 0 -2,501,039
Scope changes -167,583 0 0 0 -167,583
Other movements with no impact on cash flows 0 0 0 -1,424,721 -1,424,721
At 31
st
December 2021 143,315,435 -125,924,855 -38,433,366 -12,378,796 -33,421,582
Cash flows 36,497,884 85,205,260 -8,116,520 2,035,612 115,622,236
Foreign exchange differences 508,975 -4,162,335 505,711 -105,236 -3,252,885
Transfers 0 7,324,014 -5,077,829 0 2,246,185
Scope changes 0 0 0 0 0
Other movements with no impact on cash flows 0 -10,079,732 61,035 -2,475,075 -12,493,772
At 31
st
December 2022 180,322,294 -47,637,648 -51,060,969 -12,923,495 68,700,182
Consolidated financial statements
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Note 24. Trade and other payables
31/12/2022 31/12/2021
EUR EUR
Non-current other payables 6,005,421 7,401,156
Trade creditors: suppliers 39,802,147 32,170,208
Advances received and invoices to be received 14,042,266 12,798,383
Subtotal trade payables 53,844,413 44,968,591
Staff cost liabilities 6,268,309 6,727,199
Other payables (1) 55,463,454 54,512,366
Accruals (2) 29,566,277 33,468,689
Subtotal current other payables 91,298,040 94,708,254
TOTAL 151,147,874 147,078,001
Non-current liabilities 6,005,421 7,401,156
Current liabilities 145,142,453 139,676,845
(1) Other payables mainly consist of shareholder loans from Socfinaf for EUR 40.4 million (EUR 40.4 million in 2021). See also
Note 31.
(2) This amount comprises Okomu grant part of the loans, for EUR 6.2 million (2021: EUR 8.1 million).
Consolidated financial statements
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Note 25. Financial Instruments
31/12/2021
Loans and
borrowings
Financial
assets at
fair value
through other
comprehensive
income
Other financial
assets and
liabilities TOTAL
Loans and
borrowings (*)
Other financial
assets and
liabilities (*)
EUR At cost At fair value At cost At fair value At fair value
Assets
Financial assets at fair value through other
comprehensive income
0 715,578 0 715,578 0 0
Long-term advances 800,426 0 1,058,332 1,858,758 800,426 1,058,332
Other non-current assets 0 0 1,823,796 1,823,796 0 1,823,796
Trade receivables 0 0 42,082,792 42,082,792 0 42,082,792
Other receivables 0 0 10,238,140 10,238,140 0 10,238,140
Cash and cash equivalents 0 0 143,315,435 143,315,435 0 143,315,435
Total Assets 800,426 715,578 198,518,495 200,034,499 800,426 198,518,495
Liabilities
Long-term debts (**) 125,924,854 0 0 125,924,854 125,928,335 0
Other non-current liabilities 0 0 7,401,156 7,401,156 0 7,401,156
Short-term debts (**) 31,404,040 0 7,029,325 38,433,365 31,404,040 7,029,325
Trade payables (current) 0 0 44,968,591 44,968,591 0 44,968,591
Other payables (current) (**) 0 0 94,708,254 94,708,254 0 94,708,254
Total Liabilities 157,328,894 0 154,107,326 311,436,220 157,332,375 154,107,326
(*) For information purposes
(**) See Note 23
31/12/2021 Fair Value
EUR Level 1 Level 2 Level 3 TOTAL
Financial assets at fair value through other comprehensive income 0 0 715,578
715,578
Consolidated financial statements
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31/12/2022
Loans and
borrowings
Financial
assets at
fair value
through other
comprehensive
income
Other financial
assets and
liabilities TOTAL
Loans and
borrowings (*)
Other financial
assets and
liabilities (*)
EUR At cost At fair value At cost At fair value At fair value
Assets
Financial assets at fair value through other
comprehensive income
0 688,024 0 688,024 0 0
Long-term advances 821,712 0 1,156,825 1,978,537 821,712 1,156,825
Other non-current assets 0 0 2,699,565 2,699,565 0 2,699,565
Trade receivables 0 0 36,867,116 36,867,116 0 36,867,116
Other receivables 0 0 8,665,133 8,665,133 0 8,665,133
Cash and cash equivalents 0 0 180,322,293 180,322,293 0 180,322,293
Total Assets 821,712 688,024 229,710,932 231,220,668 821,712 229,710,932
Liabilities
Long-term debts (**) 47,637,646 0 0 47,637,646 46,962,729 0
Other non-current liabilities 0 0 6,005,421 6,005,421 0 6,005,421
Short-term debts (**) 40,365,069 0 10,695,900 51,060,969 40,365,069 10,695,900
Trade payables (current) 0 0 53,844,413 53,844,413 0 53,844,413
Other payables (current) 0 0 91,298,039 91,298,039 0 91,298,039
Total Liabilities 88,002,715 0 161,843,773 249,846,488 87,327,798 161,843,773
(*) For information purposes
(**) See Note 23.
31/12/2022 Fair Value
EUR Level 1 Level 2 Level 3 TOTAL
Financial assets at fair value through other comprehensive income 0 0 688,024
688,024
The Group did not identify significant differences between the carrying amount of the loans and their fair value.
Consolidated financial statements
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Note 26. Staff costs and average number of staff
Average number of employees 2022 2021
Directors 317 320
Employees 6,948 6,430
Workers (including temporary workers) 27,961 28,195
TOTAL 35,226 34,945
2022
2021
Staff costs EUR EUR
Remuneration 154,254,485 136,691,101
Social security and pension expenses 18,366,821 16,655,185
TOTAL 172,621,306 153,346,286
Note 27. Other financial income
2022 2021
EUR EUR
On current assets / liabilities
Interest from receivables and cash and cash equivalents 1,528,653 257,892
Forward exchange contracts 1,853,811 -509,300
Exchange gains 35,133,721 8,656,061
Others 723,543 3,215,518
TOTAL
39,239,728
11,620,171
Consolidated financial statements
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Note 28. Financial expenses
2022 2021
EUR EUR
Interest and finance expense 9,406,822 9,033,545
Interest expense on lease liabilities 1,147,359 1,062,744
Realised exchange losses 40,291,953 13,176,294
Unrealised exchange losses 3,704,219 -3,357,962
Forward exchange contracts -1,092,802 950,711
Impairment of financial assets 0 20,000
Others 3,091,131 2,035,365
TOTAL 56,548,682 22,920,697
Note 29. Net earnings per share
Undiluted net earnings per share (basic) is the profit
for the year attributable to ordinary shareholders
divided by the average number of ordinary shares
outstanding during the year. As there are no potential
dilutive ordinary shares, the diluted net earnings per
share is identical to the undiluted net earnings per
share.
2022 2021
Net profit / (loss) for the period (in euros) 75,586,975 80,389,523
Average number of shares 14,159,720 14,159,720
Net earnings per share undiluted (in euros) 5.34 5.68
Note 30. Dividends and directors’ fees
The Board will propose to the Annual General
Meeting on 30
th
May 2023, to pay a dividend of
EUR 1.25 , out of which an interim dividend of
EUR 0.75 per share was paid in November 2022.
If the proposed dividend is approved by the general
meeting of shareholders, a balance of EUR 0.50 per
share for a total amount of EUR 7.1 million would
therefore remain payable.
2022 2021
Dividends paid to the owners of the Parent 17,699,650 1,415,972
Average number of shares 14,159,720 14,159,720
Dividend per share distributed during the period 1.25 0.10
In addition, in accordance with the statutory provisions, 1/9
th
of the gross dividend is allocated to the Board of
Directors.
Consolidated financial statements
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Note 31. Information on related party
* Directors’ remuneration
31/12/2022 31/12/2021
EUR EUR
Short-term benefits 18,071,177 7,864,842
Post-employment benefits 78,433 160,333
* Related party transactions
31/12/2022 31/12/2021
EUR EUR
Current liabilities
Other payables 40,405,480 40,403,288
2022 2021
EUR EUR
Income statement
Financial expenses 1,600,000 1,600,000
Related party transactions are made at arm’s length.
Transactions relating to other related parties
are carried out with Bolloré Participations and
Palmboomen Cultuur Maatschappij (Mopoli).
Mopoli is a Dutch company which is majority owned
by Mr Hubert Fabri through Financière Privée, which
also owns Socfin.
Bolloré Participations is a shareholder and director of
Socfinaf.
In 2014, Socfinaf obtained a cash advance of
EUR 35 million from Mopoli. This advance bears an
annual interest (net of tax) of 4%. Interest is payable
in arrears at the end of each calendar quarter. The
amount of interest recognised for the year 2022
is EUR 0.8 million. As of 31
st
December 2022, the
outstanding balance amounts to EUR 20.2 million and
is repayable on demand with final maturity on July
2024.
In 2016, Socfinaf obtained a loan of EUR 20 million
from Bolloré Participations. The loan has an annual
interest rate of 4%. The amount of interest recognised
for the year 2022 is EUR 0.8 million euros. As of
31
st
December 2022, the outstanding balance amounts
to EUR 20.2 million and is repayable on demand with
final maturity on June 2024.
Consolidated financial statements
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Note 32. Off balance sheet commitments
In 2019, a subsidiary of Socfinaf, Okomu Palm Oil
Company obtained a loan of Naira 10 billion, whose
contract stipulates that Okomu will use as mortgage
guarantee, up to the loan granted, the 11,416 ha
plantation. At 31
st
December 2022, the balance of the
loan amounts to EUR 15 million (2021: EUR 14 million).
In 2019, a subsidiary of Socfinaf, Plantations Socfinaf
Ghana (PSG), obtained a loan of EUR 16.5 million for
the construction of an oil mill. This loan consists of
a credit line of EUR 15 million and a bank overdraft
of EUR 1.5 million. The contract stipulates that
PSG will use the oil mill as mortgage guarantee,
up to the loan granted. At 31
st
December 2022, the
balance of the loan amounts to EUR 8.1 million (2021:
EUR 11.4 million) and the overdraft is nil (2021: nil).
In 2021, a subsidiary of Socfinaf, Okomu Palm Oil
Company obtained a loan of Naira 2 billion, whose
contract stipulates that Okomu will use as mortgage
guarantee, up to the loan granted, the 11,416 ha
plantation. At 31
st
December 2022, the balance of the
loan amounts to EUR 3 million (2021: EUR 3 million).
In 2021, PNS Ltd obtained a loan of USD 100 million
which stipulates that as long as the loan remains
outstanding, PNS Ltd may not provide any guarantee
or provision of any other security or arrangement to
other creditors without granting them on the same
terms to the bank. PNS Ltd also opened a reserve
account with enough funds to service principal and
interest due in the first 12 months. In addition, 100%
of PNS Ltd shares, owned by Socfinasia, have been
pledged to the bank under this loan. The contract
also stipulates that a change of control in PNS Ltd’s
or in the Company’s shareholding would result in the
early repayment of the loan. At 31
st
December 2022,
the balance of the loan amounts to USD 30 million
(2021: USD 100 million). As the loan has been fully
reimbursed in February 2023, the share pledge and
the securities have been waived (see also Note 37).
Note 33. Segment information
In accordance with IFRS 8, the information analysed by
management is based on the geographical distribution
of political and economic risks. As a result, the sectors
presented are Europe, Sierra Leone, Liberia, Côte
d’Ivoire, Ghana, Nigeria, Cameroon, São Tomé and
Principe, Congo (DRC), Cambodia and Indonesia.
Products from Côte d’Ivoire, Nigeria, Cameroon and
Indonesia operating sectors come from palm oil and
rubber sales, those from the Liberia and Cambodia
sectors only from rubber sales, those from Sierra
Leone, Ghana, São Tomé and Principe and Congo come
solely from sales of palm oil. Those in the Europe
segment come from the provision of administrative
services, assistance in managing the areas under
plantation and the marketing of products outside the
Group. The segment result of the Group is the profit
from operations.
The stated figures originate from internal
reporting. They do not include any consolidation or
IFRS adjustments or restatements and are therefore
not directly comparable to amounts reported in the
consolidated statement of financial position and
income statement.
Consolidated financial statements
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* Segmental breakdown of profit / (loss) at 31
st
December 2021
EUR
Revenue from
ordinary business
with external
customers
Revenue from
ordinary business
between segments
Sector profit / (loss)
(*)
Europe 142,849,707 35,576,448 9,055,878
Sierra Leone 46,760,015 19,240,229
Liberia 36,783,462 5,538,511
Côte d’Ivoire 176,301,160 69,873 37,488,425
Ghana 26,377,673 13,096,295
Nigeria 79,363,158 34,174,303
Cameroon 143,222,868 33,644,277
São Tomé and Principe 4,776,845 -1,691,862
Congo (DRC) 13,117,259 -2,058,986
Cambodia 7,935,361 988,373
Indonesia 160,157,062 94,373 82,976,153
TOTAL 837,644,570 35,740,693 232,451,598
Elimination of revenue from intra-group activities -35,740,693
Depreciation, amortisation and impairment of bearer plants 1,417,866
Fair value of agricultural production 6,821,496
Other IFRS adjustments 1,161,838
Consolidation adjustments (intra-group and others) 29,221,565
Financial income 11,822,872
Financial expenses -26,234,642
Income tax expense -54,378,975
Net Profit / (loss) for the period 166,542,925
(*) Profit / (loss) for the period include operating expenses.
Consolidated financial statements
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* Segmental breakdown of profit / (loss) at 31
st
December 2022
EUR
Revenue from
ordinary business
with external
customers
Revenue from
ordinary business
between segments
Sector profit / (loss)
(*)
Europe 152,377,408 48,262,436 15,456,815
Sierra Leone 58,553,604 21,826,293
Liberia 40,756,657 1,747,945
Côte d’Ivoire 200,451,043 136,882 38,224,054
Ghana 33,083,346 18,234,769
Nigeria 133,279,822 56,251,979
Cameroon 147,069,445 34,187,590
São Tomé and Principe 7,781,775 779,099
Congo (DRC) 16,366,246 -398,915
Cambodia 8,164,138 -2,490,942
Indonesia 193,627,923 167,896 91,818,399
TOTAL 991,511,407 48,567,214 275,637,085
Elimination of revenue from intra-group activities -48,567,214
Depreciation, amortisation and impairment of bearer plants 7,320,577
Fair value of agricultural production -17,677,960
Other IFRS adjustments -1,373,700
Consolidation adjustments (intra-group and others) 43,998,348
Financial income 40,137,640
Financial expenses -58,863,884
Income tax expense -76,255,764
Net Profit / (loss) for the period 164,355,128
(*) Profit / (loss) for the period include other expenses for EUR 110.4 million, corresponding mainly to external services invoiced
to plantations and related directly to the operational activity (road maintenance, …), and other operating expenses for EUR
27.9 million not related directly to the operational activity (other taxes, property taxes, …).
Consolidated financial statements
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* Total segmental assets
31/12/2022 31/12/2021
EUR EUR
Europe 189,191,768 155,140,042
Sierra Leone 128,721,882 132,030,565
Liberia 121,732,913 115,585,545
Côte d’Ivoire 166,346,688 170,140,614
Ghana 57,837,090 78,724,410
Nigeria 145,216,147 139,257,028
Cameroon 184,081,225 175,101,980
São Tomé and Principe 28,111,519 27,822,826
Congo (DRC) 68,260,622 68,664,450
Cambodia 67,618,326 68,843,348
Indonesia 117,769,545 127,714,996
Total 1,274,887,726 1,259,025,805
IFRS 3 / IAS 16: Bearer plants -53,381,980 -28,557,894
IAS 2 / IAS 41: Agricultural production 13,057,113 6,243,749
Other IFRS adjustments -9,617,424 -9,048,166
Consolidation adjustments (intra-group and others) -91,269,968 -115,097,075
Total consolidated segmental assets 1,133,675,467 1,112,566,419
Consolidated assets not included in segmental assets
Goodwill 4,951,057 4,951,057
Right-of-use assets 11,902,768 10,505,511
Financial assets at fair value through other comprehensive income 688,024 715,578
Long-term advances 1,978,537 1,858,758
Deferred tax 11,698,485 19,434,382
Other non-current assets 2,699,565 1,823,796
Consolidated non-current assets 33,918,436 39,289,082
Other debtors 8,665,133 10,238,140
Current tax assets 14,942,449 15,291,971
Consolidated current assets 23,607,582 25,530,111
Total of consolidated assets in the segmental assets 57,526,018 64,819,193
Total assets 1,191,201,486 1,177,385,612
Segmental assets are not part of internal reporting, they
are included to meet the requirements of IFRS 8. They
include fixed assets, biological assets, trade receivables,
inventories, cash and cash equivalents. They do not
include any consolidation or IFRS adjustments.
Consolidated financial statements
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* Total segmental liabilities
31/12/2022 31/12/2021
EUR EUR
Europe 155,833,973 130,502,649
Sierra Leone 3,426,717 1,538,755
Liberia 13,882,723 15,247,453
Côte d’Ivoire 22,364,064 17,484,516
Ghana 1,066,056 972,502
Nigeria 6,950,565 9,223,850
Cameroon 20,840,351 25,172,132
São Tomé and Principe 3,492,126 3,468,418
Congo (DRC) 1,045,995 3,650,948
Cambodia 1,318,995 1,154,105
Indonesia 24,094,356 23,690,765
Total 254,315,921 232,106,092
Other IFRS adjustments 104,156 48,895
Consolidation adjustments (intra-group and others) -109,277,626 -92,478,141
Total consolidated segmental liabilities 145,142,451 139,676,845
Consolidated liabilities not included in segment liabilities
Total equity 809,044,033 736,910,826
Non-current liabilities 126,630,705 212,253,585
Current financial debts 51,060,969 38,433,365
Current lease liabilities 1,836,468 1,401,018
Current tax liabilities 56,820,337 48,328,464
Provisions 666,524 381,506
Total consolidated liabilities not included in segmental liabilities 1,046,059,034 1,037,708,764
Total equity and liabilities 1,191,201,485 1,177,385,609
Segmental liabilities include only trade payables and other payables.
Consolidated financial statements
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* Costs incurred for acquisition of segmental assets during 2021
EUR
Intangible
assets
Tangible
assets
Investment
properties
Biological
assets TOTAL
Europe 6,670 179,922 36,504 0 223,096
Sierra Leone 0 2,207,733 0 0 2,207,733
Liberia 0 1,613,464 0 3,808,942 5,422,406
Côte d’Ivoire 3,666 6,125,172 0 4,144,678 10,273,516
Ghana 0 1,978,271 0 137,231 2,115,502
Nigeria 0 27,082,944 0 1,632,191 28,715,135
Cameroun 0 9,974,210 0 3,177,201 13,151,411
São Tomé and Principe 0 256,352 0 0 256,352
Congo (DRC) 0 781,126 0 0 781,126
Cambodia 0 436,270 0 859,167 1,295,438
Indonesia 658,565 4,258,034 0 4,914,771 9,831,370
TOTAL
668,902 54,893,499 36,504 18,674,180 74,273,085
* Costs incurred for acquisition of segmental assets during 2022
EUR
Intangible
assets
Tangible
assets
Investment
properties
Biological
assets TOTAL
Europe 2,683 7,896,419 34,782 0 7,933,884
Sierra Leone 0 2,125,221 0 0 2,125,221
Liberia 0 2,197,106 0 898,587 3,095,694
Côte d’Ivoire 32,003 5,966,349 0 3,393,844 9,392,196
Ghana 0 2,277,025 0 0 2,277,025
Nigeria 0 22,269,520 0 827,710 23,097,230
Cameroun 0 10,862,418 0 3,144,690 14,007,108
São Tomé and Principe 0 275,584 0 0 275,584
Congo (DRC) 0 906,694 0 0 906,694
Cambodia 0 417,668 0 469,391 887,058
Indonesia 635,933 5,886,190 0 7,013,022 13,535,145
TOTAL
670,619 61,080,195 34,782 15,747,244 77,532,840
Consolidated financial statements
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* Information by sector of activity
Revenue from external customers :
2022 2021
EUR EUR
Palm 582,827,456 471,225,684
Rubber 269,137,780 233,974,853
Other agricultural activities 9,316,123 5,607,086
Trading activities 119,380,568 118,572,588
Others 10,849,478 8,264,360
TOTAL
991,511,407 837,644,570
* Information by geographical region
Revenue from external customers by origin of the customers and geographical location:
EUR
2021
Geographical
location
Origin Europe Africa Asia America Oceania TOTAL
Europe 4,178,220 2,207,994 794,752 0 0 7,180,966
Africa 56,244,615 307,777,744 277,729,299 23,343,369 0 665,095,027
Asia 6,351,240 9,166,449 148,817,865 1,030,279 2,742 165,368,575
TOTAL
66,774,075 319,152,187 427,341,915 24,373,648 2,742 837,644,569
EUR
2022
Geographical
location
Origin Europe Africa Asia America Oceania TOTAL
Europe 3,865,186 2,292,183 1,370,073 0 0 7,527,442
Africa 271,281,825 397,718,362 49,169,238 62,509,276 0 780,678,701
Asia 8,010,890 9,297,206 180,852,212 5,144,956 0 203,305,263
TOTAL
283,157,902 409,307,751 231,391,522 67,654,232 0 991,511,407
Consolidated financial statements
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* Information by business segment and revenue category
Revenue from external customers by business segment and geographical area:
EUR
2021
Category
Business Segment
Palm Rubber
Other
agricultural
products
Service
and other
commercial
business TOTAL
Sierra Leone 46,760,015 0 0 0 46,760,015
Liberia 0 36,783,462 0 0 36,783,462
Côte d’Ivoire 30,383,586 143,723,806 0 2,193,768 176,301,160
Ghana 25,714,194 391,733 0 271,746 26,377,673
Nigeria 67,439,332 11,787,948 0 135,878 79,363,158
Cameroon 130,353,234 12,176,882 393,932 298,821 143,222,868
São Tomé and Principe 4,776,845 0 0 0 4,776,845
Congo (DRC) 13,117,259 0 0 0 13,117,259
Indonesia 137,718,617 16,041,901 5,213,154 1,183,389 160,157,062
Cambodia 0 7,935,361 0 0 7,935,361
Europe 14,962,599 5,133,761 0 122,753,347 142,849,707
TOTAL
471,225,681 233,974,854 5,607,086 126,836,949 837,644,570
EUR
2022
Category
Business Segment
Palm Rubber
Other
agricultural
products
Service
and other
commercial
business TOTAL
Sierra Leone 58,553,604 0 0 0 58,553,604
Liberia 0 40,635,339 0 121,318 40,756,657
Côte d’Ivoire 39,919,397 157,537,229 0 2,994,417 200,451,043
Ghana 31,991,119 968,476 0 123,751 33,083,346
Nigeria 120,757,226 12,346,955 0 175,641 133,279,822
Cameroon 133,093,402 10,764,990 1,947,102 1,263,951 147,069,445
São Tomé and Principe 7,781,775 0 0 0 7,781,775
Congo (DRC) 16,366,246 0 0 0 16,366,246
Indonesia 170,771,625 14,157,868 7,369,021 1,329,408 193,627,923
Cambodia 0 8,164,138 0 0 8,164,138
Europe 3,593,062 24,562,785 0 124,221,560 152,377,408
TOTAL
582,827,457 269,137,780 9,316,123 130,230,047 991,511,407
Consolidated financial statements
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Note 34. Risk management
Capital management
The Group manages its capital and adjusts accordingly
in response to changes in economic conditions and
investment opportunities. To maintain or adjust the
capital structure, the Group may issue new shares,
repay part of the capital or adjust the payment of
dividends to shareholders.
The Group also manages its capital by close monitoring
of the ratio of debt over equity.
Financial risk
The financial risk for the companies within the Group
comes mainly from changes in the selling price of
agricultural commodities, foreign exchange and to a
lesser extent, interest rate movements.
Potential risk
None of the countries in which the Group operates
has a hyperinflationary economy or suffers from an
immediate threat of price devaluation. Nevertheless,
in a minority of countries in which the Group operates,
the political system and economic stability remain
fragile and could lead to currency devaluation or
hyperinflation.
Risk management and opportunities
The Group regularly reviews its sources of financing
as well as currency movements and its decisions are
based on a variety of risks and opportunities which are
themselves based on several factors including interest
rates, currency and counterparties.
Market risk
* Price risk in commodities market
Potential risk
The Group markets its finished products at prices
which may be influenced by commodity prices in
international markets. It therefore faces the risk of
volatility in the prices of these commodities.
Risk management and opportunities
The main policy of the Group’s companies has always
been to control its production costs in order to
generate margins for the viability of structures in the
event of a significant drop in the selling prices of raw
materials and conversely to generate profit margins
during the market downturns.
In parallel with this main policy, secondary policies
have also been implemented to improve or consolidate
profit margins:
- production of agricultural products of superior
quality and branded, in particular for rubber and;
- use of the Group’s expertise in the commercial
sector.
The Group reduces its exposure to price risk by
investing into different geographical markets and
products.
* Foreign currency risk
Potential risk
The Group carries out transactions in local currencies,
mainly being US dollar, Nigerian naira and Indonesian
rupiah. In addition, financial instruments hedging
against exchange rate fluctuations may not be
available for certain currencies. This creates exposure
to exchange rate fluctuations which may have an
impact on the financial result denominated in euro.
In Nigeria, the availability of hard currency is extremely
limited. The gap between the central bank rate (CBN)
and OTC rates is widening, reaching 30 to 35% in 2022.
For consolidation purposes, the Group uses the Central
Bank of Nigeria (CBN) rates. These rates are disclosed
in Note 1.9 to the financial statements. The impact of
the Group’s Nigerian operations on the consolidated
result is disclosed in Note 33 (Segmental information)
to the financial statements.
Risk management and opportunities
Apart from the current currency hedging instruments
for operational transactions (which remain relatively
limited), the main policy of the Group is to finance
its development projects in local currencies in the
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region given the significant investments made in
the plantations and wherever possible, to reduce
borrowings.
Management closely monitors developments in the
Nigerian foreign exchange markets and is keen to
present a fair view of the financial statements.
* Interest rate risk
Potential risk
This risk includes a change in cash flows relating to
short-term borrowings (often on a variable rate) and
the relatively high level of base interest rates on cash
and cash equivalents and developing markets when
borrowing in local currency.
Risk management and opportunities
The first risk is put under control by an active policy of
monitoring the evolution of local financial markets and
sometimes short-term debt consolidation in the long
term, if necessary. The second risk is considered by
a systematic policy of putting local and international
banks in competition with international lenders
who can offer real investment and development
opportunities at attractive rates.
Credit risk
Potential risk
Credit risk arises from the potential inability of clients
to meet their contractual obligations.
Risk management and opportunities
To manage this risk, the Group ensures the payment of
local sales in cash or the guarantee of the receivables
by obtaining approved bills of exchange. The export
sales of the plantations are centralised in the Group’s
sales structure, which applies either a cash payment
policy or a commercial credit policy whose limits are
defined by its Board of Directors.
Details on impairment of financial assets and liabilities,
including measurement of expected credit losses, are
disclosed in note 1.19.
Liquidity risk
Potential risk
Liquidity risk is defined as the risk that the Group
cannot meet its obligations on time or at a reasonable
price. This risk is mainly impacting plantations which
are both the main source of cash and financing needs.
Risk management and opportunities
Given the specific economic and technological
environment of each plantation, the Group manages
this risk in a decentralised manner. However, both
the cash available and the implementation of the
financing are supervised by the Group Management.
The Group chooses, whenever possible, to maintain
financial liabilities and cash position (as mentioned
respectively in notes 23 and 19) with low credit risk
institutions.
Emerging market risks
Potential risk
Current or future political instability in certain
countries in which the Group operates may affect the
ability to do business, generate revenue and impact
the Group’s profitability.
The political system in some of the Group’s markets
remains relatively fragile and remains potentially
threatened by cross-border conflicts or wars between
rival groups.
Risk management and opportunities
The Group’s activities contribute to improve the
quality of life in the countries in which the Group
operates while improving the stability of its markets
may lead to an appreciation of the value of the
Group’s companies located locally.
Diversifying the geographic mix of countries,
economies and currencies in which the Group
generates its revenues and cash flows reduces its
exposure to emerging market risk.
The Group is aware of the environmental and social
responsibility it has towards the local population and
is implementing initiatives to this end.
Consolidated financial statements
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Risk of expropriation
Potential risk
Certain countries in which the Group operates have
political regimes that may call into question foreign
commercial interests by limiting their activities and
may attempt to impose control over the Group’s assets.
Risk management and opportunities
The diversification of the geographical distribution
of the countries in which the Group generates its
revenues and its cash flows reduces its exposure to
this risk.
Credibility risk
Potential risk
The Group is exposed to the risk of loss of confidence
of the financial markets in relation to its ability to
maintain a sound financial health considering:
- its environmental impact,
- its social responsibility and
- the economic and geopolitical risks that certain
Group entities may face.
Risk management and opportunities
The Group has published its responsible management
policy in 2017, updated in 2022. This complements
the Group’s sustainable development commitments,
formalised in 2012.
The Group’s initiatives to monitor the risk are detailed
in the information provided in the annual sustainable
development report available on request at Group
headquarters.
Risk sensitivity
* Exchange rate risk
The Group is exposed to changes in value arising
from fluctuations in exchange rates generated by its
operating activities. However, as local turnover were
made in the local currency and export sales are made
in US dollar, the Group’s exposure is mainly limited to
fluctuations in dollar against the euro. The impact on
the result of a 10% increase or decrease (EUR/USD)
in foreign currency financial instruments amounts to
EUR 8.6 million.
In the case where the currency of sale is not the
functional currency of the Company, and it is linked
to a strong currency, the conversion is ensured at the
time of the conclusion of the contract. The local sales
concluded in the local currency in 2022 (including
US dollars) amounted to EUR 565.4 million. The
global sales (mainly concluded in US dollars) in 2022
amounted to EUR 426.1 million.
* Interest rate risk
The breakdown of fixed rate loans and variable rate
loans is described in Note 23. Following the variable
rate loan arrangement entered into by PNS Ltd in
November 2021, the Group is exposed to interest rate
risk. To control this risk, the management closely
monitors the interests rate evolution. In February
2023, PNS Ltd repaid the last instalment of the loan,
reducing the Group exposure to interest rate risk (see
note 37).
* Credit risk
At 31
st
December 2022, the trade receivables from
global customers and local customers amounted to
EUR 16.2 million and EUR 24.6 million respectively.
Accounts receivable from global customers are
mainly receivables related to the sale of rubber. Raw
palm oil is sold locally to local players (wide range
of customers). The marketing of refined palm oil and
rubber is entrusted to Sogescol FR. It trades either on
the physical markets or directly with end customers.
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2022 2021
EUR EUR
Trade receivables 40,812,839 46,089,287
Provision incurred mainly on non-operational receivables -3,945,723 -4,006,494
Other receivables 8,665,133 10,238,137
Total net receivables 45,532,249 52,320,930
Amount not due 44,544,890 51,464,658
Amount due less than 6 months 236,316 68,122
Amount due for more than 6 months and less than one year 405,019 760,051
Amount due for more than one year 346,024 28,099
Total net receivables 45,532,249 52,320,930
Note 35. Contingent liabilities
1. Litigation against the Belgian Federal Public Service
Finance (Corporate Tax)
The company SOCFICOM (“Socficom”), a public
limited company incorporated under Liechtenstein
law and a subsidiary of the Group, was the subject of
criminal proceedings initiated by the Belgian Public
Prosecutor’s Office.
The main accusation against Socficom was that the
Belgian Public Prosecutor’s Office considered that
Socficom was a “Belgian resident company”, subject
to Belgian corporate income tax.
Socficom was acquitted, following a ruling by the 11
th
Chamber of the Brussels Court of Appeal, sitting in
correctional matters, dated 23
rd
October 2018. The
Court ruled that “it is clear from all these elements
that the real seat of the defendant Socficom is indeed
established in Liechtenstein and that nothing allows
it to be located in Brussels”. The Public Prosecutor’s
Office did not appeal against this judgement and this
decision is therefore final.
However, the Federal Public Service Finance, relying
itself exclusively on the investigation file submitted
by the Belgian Public Prosecutor’s Office in criminal
matters, maintains that Socficom meets the conditions
for it to be liable to corporate income tax in Belgium
(the Federal Public Service Finance considers that
Socficom is effectively managed from Belgium and
that all its activities were carried out there).
Socficom was therefore automatically assessed with
corporate income tax, on 4
th
January 2012, for the tax
years 2004 to 2009 for an amount of EUR 77,343,783
excluding late payment interest at an annual rate of
7% reduced to 4% as from 1
st
January 2018.
On 5
th
April 2013, Socficom filed a tax claim against
these 6 ex officio tax assessments. These 6 claims
were declared admissible, but were rejected.
Socficom filed an action before the “Tribunal de
première instance francophone” of Brussels.
The “Tribunal de première instance francophone” of
Brussels, by judgement dated 26
th
April 2019, declared
the claim admissible and partially founded insofar as
it ordered the partial relief of the disputed taxes.
Socficom considers that this decision, although partly
favourable to the argument it defended before the
Court, is not satisfactory, given the acquittal decision
referred to above.
The tax authorities want to tax Socficom exclusively
on the basis of the elements of the criminal file, as
the tax file does not contain any “new claims” in
relation to the criminal proceedings. The facts judged
in the tax proceedings have already been decided by
the Court of Appeal (correctional chamber) which
acquitted Socficom and the other defendants.
The Court could therefore not agree with the tax office
on the basis of documents, observations or findings,
without taking into considerations the judgement of
the Court of Appeal of 23
rd
October 2018. The Brussels
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Tax Court has “re-heard” the criminal case ignoring
the acquittal of the 11
th
Chamber of the Brussels Court
of Appeal.
Socficom has therefore decided to appeal against the
tax judgement in order to request that the Court grants
the request initially formulated by the company, i.e.
to order the complete cancellation of the relief of the
disputed taxes.
Tax judgements that are appealed against are not
enforceable until the Court has ruled on them.
The amounts initially claimed by the tax authorities
from Socficom amounted to EUR 77,343,783,
excluding interest (see above), from which it must be
deducted the relief granted by the Court amounting
to EUR 50,000,000.
The company’s counsel and Group management are
of the opinion that the Court of Appeal should fully
cancel these taxes, based on the acquittal decision
of the Court of Appeal, Correctional Chamber, dated
23
rd
October 2018 which confirms: “that the real seat
of the defendant Socficom is indeed established in
Liechtenstein and that there is no reason to locate it in
Brussels”. Based on these elements, the management
is of the opinion that no provision should be recorded
as the probability of an outflow of financial resources
by the Group is low. The findings of the Court of Appeal
are not expected before 2024.
2. Litigation against the Belgian Federal Public
Service Finance (VAT)
As described above, the Federal Public Service
Finance maintains that Socficom is a Belgian resident
company. The tax authorities are claiming VAT of
EUR 3,054,160.15 for the years 2006, 2007, 2008 and
2009, adding to this tax fines and interest at a rate of
0.8% per month as from 20
th
January 2010.
The amounts claimed amount to EUR 10,310,844.61,
split as follows:
- EUR 3,054,160 for VAT
- EUR 1,148,364 in interest
- EUR 6,108,320 in fines
- plus interest for late payment to be calculated on
the VAT due from 21
st
December 2013.
Socficom contested this tax before the Brussels Court
of First Instance.
The Court declared the claim admissible and
partially founded insofar as it cancelled the fines
of EUR 6,108,320 and the interest charged on this
amount.
Socficom considers that this decision, although
partially favorable to the case it defended before
the Court, is not satisfactory since it was granted the
acquittal following the judgement rendered by the
11
th
Chamber of the Brussels Court of Appeal dated
23
rd
October 2018.
In order to claim the disputed VAT from Socficom, the
tax authorities based themselves exclusively on the
criminal file. However, the Brussels Court could not
ignore the acquittal decision and condemn Socficom
without taking into account the final and res judicata
judgement of the Brussels Court of Appeal.
In the absence of new elements brought by the tax
authorities and having an impact on the outcome
of the trial, the decision of the Court of Appeal of
23
rd
October 2018 could not be challenged and is
binding on the Court.
Socficom therefore decided to appeal the tax ruling in
order to request that the Court to grant the request
initially made by the company, i.e. to order a tax
relief for the disputed taxes.
The Company’s counsel and the Group’s management
are of the opinion that the Court of Appeal should fully
cancel these taxes, based on the acquittal decision
of the Court of Appeal, Correctional Chamber, dated
23
rd
October 2018, which confirms: “that the real seat
of the defendant Socficom is indeed established in
Liechtenstein and that there is no reason to locate it
in Brussels”. Based on these elements, management is
of the opinion that no provision should be recorded as
the probability of an outflow of financial resources by
the Group is low. The findings of the Court of Appeal
are not expected before 2024.
3. Claim against “Caisse Nationale de Prévoyance
Sociale”
Société des Caoutchoucs du Grand Bereby (“SOGB”), a
public limited company incorporated under Ivorian law
and subsidiary of the Group, is involved in a dispute
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with the Caisse Nationale de Prévoyance Sociale
(“CNPS”) of Côte d’Ivoire. This dispute concerns the
tax audit of the benefits in kind that SOGB should
have paid to CNPS for having provided housing to its
employees.
Following an initial analysis for the period from
1
st
January 2010 to 31
st
December 2013, CNPS estimated
an amount due of CFA 182 million, equivalent to
EUR 277,000. Based on SOGB’s calculations, the
amount owed is CFA 32 million, equivalent to
EUR 48,000.
Following a contestation, the case was brought
before the Court of Sassandra. The latter invited the
two parties to reach an amicable settlement of the
dispute between them and to submit a transactional
agreement, if necessary.
In the absence of an amicable settlement of the
dispute, it would be up to the Sassandra Court to rule
on the merits.
The CNPS carried out a second analysis covering the
years 2014 through 2018. The CNPS added to the
previous amount a sum of CFA 1,650 million, equivalent
to EUR 2.5 million. The SOGB has recorded a provision
of CFA 250 million, equivalent to EUR 381,000,
which corresponds to the amount it considers to be
effectively due.
The issue of housing on plantations in rural areas is
a general one and concerns most agricultural and
forestry companies, particularly those in the rubber,
oil palm and banana sectors.
For this reason, actions have been taken by companies
in the sector, supported by the Union of Agricultural
and Forestry Companies (“UNEMAF”) and the
General Confederation of Companies of Côte d’Ivoire
(“CGECI”), to obtain a clear position from the CNPS
on this issue.
The CNPS had always granted a tolerance concerning
the determination of benefits in kind constituted by
the provision of housing in rural areas.
A proposal for arbitration was submitted to the
Ministry of Employment and Social Protection by a
working group comprising members of CGECI and
UNEMAF. Working group meetings were scheduled
to take place in the course of 2020, but these were
postponed due to the health situation and have not
been resumed to date.
At the date of the closing of the accounts, the
amicable procedure is therefore still in progress. Its
outcome will determine whether or not the case is
referred to the Sassandra Court, which alone has the
power to enforce the parties. Insofar as there is no
legal constraint to date, and based on the above,
management is of the opinion that no provision should
be recorded because the probability of a claim is very
low.
Note 36. Political and economic environment
The Group (company) holds interests in subsidiaries
that operate indirectly in Africa and South-East Asia.
Given the economic and political instability in some of
these countries, these holdings pose a risk in terms of
exposure to political and economic changes.
Note 37. Events after the closing date
Early partial repayment of loan
As of 24
th
February 2023 and following an early
prepayment of Socfin’s debt to PNS Ltd, PNS Ltd itself
repaid early the outstanding balance of its bank loan,
amounting to USD 30,000,000.
Following this final repayment, PNS Ltd bank loan is
fully reimbursed, the share pledge and the securities
have been waived.
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Consolidated financial statements
Note 38. Auditor’s fees
2022 2021
EUR EUR
Audit (VAT included)
1,509,211 1,387,989
The audit fees include all fees paid to the independent
statutory auditor of the Group namely EY as well as
those paid to member firms within EY network for the
relevant years. No consulting work or other non-audit
services have been performed by this firm in 2022 or
in 2021.
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Company’s Management Report
Presented by the Board of Directors at the Annual General Meeting of 30
th
May 2023
Ladies and gentlemen,
We are pleased to present our annual report and to submit for your approval the annual accounts of our Company
at 31
st
December 2022.
Activities
Socfin mainly holds financial interests in portfolio companies which operate indirectly in Southeast Asia and/or
tropical Africa in the rubber and palm oil sectors.
Result of the year
The profit and loss account for the year, compared to that of the previous year, is as follows:
(EUR million) 2022 2021
INCOME
Income from participating interests
derived from affiliated undertakings
Dividends
34.2 10.3
Interest on receivables
8.8 4.9
43.0 15.2
Income from current assets
3.6 1.4
Total income
46.6 16.6
EXPENSES
Other external charges
1.5 1.6
Interest payable and similar expenses
11.3 4.9
Total expenses
12.8 6.5
PROFIT FOR THE FINANCIAL YEAR
33.8 10.1
At 31
st
December 2022, net profit amounted to EUR 33.8 million compared to EUR 10.1 million at the end of the
previous year.
Revenue amounted to EUR 46.6 million (EUR 16.6 million at 31
st
December 2021).
Total expenses amounted to EUR 12.8 million compared to EUR 6.5 million at 31
st
December 2021.
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Balance sheet
At 31
st
December 2022, Socfin’s total assets amounted
to EUR 324.5 million compared to EUR 383.7 million at
31
st
December 2021.
Socfin’s assets consist of a portfolio of
EUR 187.4 million, financial fixed assets
of EUR 120.4 million, and other debtors of
EUR 16.5 million.
Equity amounted to EUR 210.1 million.
Porfolio
Movements
During the financial year 2022, Socfin acquired 22,299
shares in Socfinaf for a total amount of EUR 0.3 million,
31,494 shares in Socfinasia for a total amount of
EUR 0.5 million and 1,000 shares in Management
Associates for a total amount of EUR 0.2 million.
Socfin sold 10 shares of Brabanta for a total amount of
EUR 0.1 million.
Revaluations
At 31
st
December 2022, the unrealised capital
gains on the investment portfolio are estimated at
EUR 141.5 million compared to EUR 95.7 million in
previous year.
Holdings
The main holdings have evolved as follows during the
last months:
Socfinasia S.A. (Luxembourg) - 58.25%
The company holds stakes in Southeast Asian
companies active in the rubber and palm oil sector.
At 31
st
December 2022, net profit amounted to
EUR 70.7 million compared to EUR 45 million at
31
st
December 2021.
The net value of Socfinasia’s investments amounted
to EUR 289.6 million at 31
st
December 2022 and the
valuation of the portfolio shows unrealised gains of
EUR 101.9 million.
At the next General Meeting, the Board of Directors of
Socfinasia will propose the payment of a final dividend
of EUR 1.50 per share, an interim dividend of EUR 2.00
has already been paid in November 2022.
2022 2021
Socfinasia (EUR million)
Assets
457.7 451.9
Fixed assets
405.7 410.5
Current assets
52.0 41.4
Equity and Liabilities
457.7 451.9
Equity
452.1 446.8
Liabilities
5.6 5.1
Socfinaf S.A. (Luxembourg) – 64.64%
The company has interests in entities in tropical Africa
active in the rubber and palm oil sector.
At 31
st
December 2022, net loss amounted to
EUR 37.5 million compared to a net profit of
EUR 6.5 million at 31
st
December 2021. This result
was impacted by the non-recurrent impairment of
EUR 66.1 million which has been accounted on the
investment in Brabanta.
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The net asset value of financial assets amounted to
EUR 182.9 million at 31
st
December 2022 and the
valuation of the portfolio generated unrealised gains
of EUR 505.8 million. This unrealised capital gain,
however, takes into account a valuation of Okomu at
the NGN/USD exchange rate of the Central Bank of
Nigeria. This exchange rate is significantly out of line
with the price obtained on the OTC markets. Taking
the latter into account, the capital gain would be
reduced to EUR 419.9 million.
The Board of Directors of Socfinaf will propose at the
next General Meeting not to pay a dividend for the
financial year 2022.
2022 2021
Socfinaf (EUR million)
Assets
398.6 499.2
Fixed assets
361.7 469.1
Current assets
36.9 30.1
Liabilities
398.6 499.2
Equity
221.3 258.8
Liability
177.3 240.4
Allocation of profit
The profit for the year for Socfin of EUR 33,793,761
increased by the retained earnings of
EUR 103,075,980 result in total earnings of
EUR 136,869,741 which it is proposed to allocate as
follows:
Earnings allocation
EUR
Retained earnings 117,203,463
From the balance:
10% to the Board of Directors
1,966,628
90% to 14,159,720 shares
17,699,650
representing EUR 1.25 per share of which EUR 0.75 already paid on November 2022
136,869,741
As a reminder, the dividend relating to previous year was EUR 0.60.
Reserves
After this distribution of profit, the reserves will be as follows:
EUR
Legal reserve 2,477,951
Other reserves 57,277,681
Retained earnings 117,203,463
176,959,095
If this distribution is approved, coupon Nr 82 of EUR 0.50 will be declared on 6th June 2023 and will be payable
as from 8
th
June 2023.
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Treasury shares
The company did not buy back its own shares during the 2022 financial year.
Research and development
During the financial year 2022, Socfin did not incur any expenses for research and development.
Financial instruments
Financial risk management policies are described in the notes to the company’s consolidated financial statements.
Branch
The company has a permanent establishment in
Fribourg (CH).
Mentions required by Art. 11 (1) points a) to k)
of the law of 19
th
May 2006 concerning Public
Takeover Bids
a) b) f) The issued capital of the Company is set at
EUR 24,779,510 represented by 14,159,720 shares
without par value, fully paid up. Each share
entitles the holder to one vote without limitation
or restriction.
c) On 04/11/2022, Mr. Hubert Fabri declared that
he held a direct and indirect stake of 55.38% in
Socfin.
On 29/10/2021, Bolloré Participations SE declared
that it held a direct and indirect interest of 39.75%
in Socfin.
h) Art. 14. of the statutes: “The Company is
administered by a Board composed of at least
three members, whether natural or legal persons.
The Directors are appointed for a period of six
years by the General Meeting of Shareholders.
They are eligible for re-election. The Directors
are renewed by lottery, so that at least one
Director will be leaving each year.”
Art. 23. of the statutes: “In the event of
vacancy of one or more director’s seat, it may
be provisionally replaced by complying with the
formalities provided for by law.”
Art. 32. of the statutes: “The present statutes can
be modified by decision of the General Meeting
specially convened for this purpose, in the forms
and conditions prescribed by articles 450-1
and 450-8 of the law of 10
th
August 1915 on the
commercial companies, as amended.”
i) The powers of the members of the Board of Directors
are defined in Art. 18 and seq. of the statutes of the
Company. They provide in particular that: “The Board
of Directors is vested with the broadest powers for
the administration of the Company. All matters not
expressly reserved to the General Meeting by the
statutes or the law fall within the competence of
the Board.”
In addition, the statutes provide in Art. 6: “In the
event of a capital increase, the Board of Directors
shall determine the conditions of issue of the shares.
The new shares to be paid up in cash shall be
offered in preference to the current shareholders,
in accordance with the law.
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In the event of the issue of shares by contribution
in cash or in the event of the issue of instruments
which fall within the scope of application of article
420-27 of the law on companies and which are
paid for in cash, including and in a non-exhaustive
manner, convertible bonds allowing their holder
to subscribe to shares or to be allocated shares,
shareholders have preferential subscription rights
in proportion to their participation with regard to
all these issues in accordance with the provisions of
company law.
The General Meeting called to deliberate, under
the conditions required for the amendment of
the Articles of Association, on the increase in the
share capital or on the authorisation to increase
the capital in accordance with Article 420-23 of the
law of commercial companies, may limit or cancel
the preferential subscription right or authorise
the Board to do so in the manner and under the
conditions provided for by law.”
The other points of Art. 11 (1) are not applicable,
namely:
• holding of shares giving special control rights;
• the existence of a staff shareholding system;
• shareholder agreements that may result in
restrictions on the transfer of securities or voting
rights;
• the indemnities provided in the event of the
resignation or dismissal of members of the Board
of Directors or staff following a takeover bid.
Corporate responsibility policy
The responsible management policy is based on the
Group’s three pillars of commitment, alongside
its specific commitment to transparency: rural
development, workers and local communities, and
environment. These commitments form the basis of
key initiatives aimed at improving long-term economic
performance, social well-being, health, safety and
natural resource management.
An implementation plan for this policy has been
defined and implemented throughout 2022.
The efforts and actions undertaken by the Socfin
Group in this area are detailed in a regularly updated
dashboard as well as in a separate annual report
(“Sustainable Development Report”).
The responsible management policy, the dashboard
and the annual sustainable development report are
available on the Group’s website.
Estimated value of the share (company accounts)
The estimated value of Socfin at 31
st
December 2022
amounts to EUR 351.6 million (EUR 24.83 per share).
This valuation includes unrealised gains on the
portfolio.
As a reminder, the share price was EUR 20.20 at the
end of the 2022 financial year compared to EUR 20.80
one year earlier.
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Significant events after the end of the year
At 24
th
February 2023, Socfin early repaid an amount
of USD 14,750,000 i.e. EUR 13,160,033 to PNS Ltd as a
final reimbursement of the loan.
Key risks and uncertainties
It must be emphasised that the Group’s investments in
Africa and Southeast Asia may be subject to political
and economic risks. On-site executives and managers
follow the day-to-day evolution of the situation.
Perspectives
The result for the 2023 financial year will depend to
a large extent on the dividend distributions of the
subsidiaries.
Statutory appointments
Mr. Vincent Bolloré, outgoing director, is eligible for
re-election. The Board will propose to the next
General Meeting the renewal of this term of office for
a period of six years.
The Board of Directors
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Audit report on the Company’s financial statements
INDEPENDENT AUDITOR’S REPORT
To the Shareholders of
Société Financière des Caoutchoucs S.A.
4, avenue Guillaume
L-1650 Luxembourg
Report on the audit of the financial statements
Opinion
We have audited the financial statements of Société
Financière des Caoutchoucs S.A. (the “Company”),
which comprise the balance sheet as at 31 December
2022, and the profit and loss account for the year then
ended, and the notes to the financial statements,
including a summary of significant accounting policies.
In our opinion, the accompanying financial statements
give a true and fair view of the financial position of the
Company as at 31 December 2022, and of the results of
its operations for the year then ended in accordance
with Luxembourg legal and regulatory requirements
relating to the preparation and presentation of the
financial statements.
Basis for opinion
We conducted our audit in accordance with EU
Regulation N° 537/2014, the Law of 23 July 2016
on the audit profession (the “Law of 23 July 2016”)
and with International Standards on Auditing (“ISAs”)
as adopted for Luxembourg by the “Commission de
Surveillance du Secteur Financier” (“CSSF”). Our
responsibilities under the EU Regulation Nº 537/2014,
the Law of 23 July 2016 and ISAs are further described
in the “Responsibilities of the “réviseur d’entreprises
agréé” for the audit of the financial statements”
section of our report. We are also independent of
the Company in accordance with the International
Ethics Standards Board for Accountants’ Code of
Ethics for Professional Accountants (“IESBA Code”) as
adopted for Luxembourg by the CSSF together with
the ethical requirements that are relevant to our
audit of the financial statements, and have fulfilled
our other ethical responsibilities under those ethical
requirements. We believe that the audit evidence we
have obtained is sufficient and appropriate to provide
a basis for our opinion.
Key audit matters
Key audit matters are those matters that, in our
professional judgment, were of most significance in
our audit of the financial statements of the current
period. These matters were addressed in the context
of the audit of the financial statements as a whole,
and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
Valuation of shares in affiliated undertakings
Risk identified
As at 31 December 2022, the shares in affiliated
undertakings amounts to 187 million euros and
represents 58% of the total assets of the balance
sheet. Shares in affiliated undertakings are valued at
historical acquisition cost, respectively their nominal
value, which includes incidental expenses. In the case
of durable depreciation in value according to the
opinion of the Board of Directors, value adjustments
are made in respect of financial fixed assets, so that
they are valued at the lower figure to be attributed
to them at the balance sheet date. These value
adjustments are not continued if the reasons for
which the value adjustments were made have ceased
to apply. In the event of an impairment that, in the
opinion of the Board of Directors, is of a lasting
nature, these financial assets are subject to value
adjustments in order to give them the lower value
that should be attributed to them on the balance
sheet date, as determined by the Board of Directors.
The assessment of the durable depreciation in value
of these shares in affiliated undertakings requires the
exercise of the Board of Directors’ judgement in its
choice of the elements to be considered according
to the shares in affiliated undertakings, whether
market elements (shares price when applicable) and/
or historical elements (adjusted net equity) and/or
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Audit report on the Company’s financial statements
forecast elements (discounted future cash flows to
shareholders).
Due to the size of the balance and judgement included,
we considered this area to be a key audit matter.
Our answer
Our audit procedures over the impairment of the shares
in affiliated undertakings and of the loans to affiliated
undertakings included amongst other :
• Assessing the accounting policies determined by
the Board of Directors, as described in the note 2
of the financial statements, to determine the value
adjustments to be recorded on shares in the affiliated
undertakings ;
• Ensuring that the accounting policies used by the
Board of Directors were properly applied:
- when the Board of Directors relied on market
data, we reconciled the share prices as at 31
December 2022 used for the valuation of shares in
affiliated undertakings to the official stock markets
quotations ;
- when the Board of Directors relied on historical
data, we reconciled the adjusted net equity
used in the valuation of the shares in affiliated
undertakings as at 31 December 2022 to the
financial information of the related affiliated
undertakings and assessed the appropriateness of
evidence supporting the adjustments made to the
net equity, if any.
• Assessing the appropriateness of the disclosures
made in the Note 3 of the financial statements.
Other information
The Board of Directors is responsible for the other
information. The other information comprises the
information included in the annual report including
the management report and the corporate governance
statement but does not include the financial
statements and our report of “réviseur d’entreprises
agréé” thereon.
Our opinion on the financial statements does not cover
the other information and we do not express any form
of assurance conclusion thereon.
In connection with our audit of the financial statements,
our responsibility is to read the other information and,
in doing so, consider whether the other information is
materially inconsistent with the financial statements
or our knowledge obtained in the audit or otherwise
appears to be materially misstated. If, based on the
work we have performed, we conclude that there is a
material misstatement of this other information, we
are required to report this fact. We have nothing to
report in this regard.
Responsibilities of the Board of Directors and
those in charge of governance for the financial
statements
The Board of Directors is responsible for the
preparation and fair presentation of the financial
statements in accordance with Luxembourg legal and
regulatory requirements relating to the preparation
and presentation of the financial statements, and
for such internal control as the Board of Directors
determines is necessary to enable the preparation
of financial statements that are free from material
misstatement, whether due to fraud or error.
The Board of Directors is also responsible for
presenting the financial statements in compliance with
the requirements set out in the Delegated Regulation
2019/815 on European Single Electronic Format, as
amended (“ESEF Regulation”).
In preparing the financial statements, the Board of
Directors is responsible for assessing the Company’s
ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using
the going concern basis of accounting unless the Board
of Directors either intends to liquidate the Company
or to cease operations, or has no realistic alternative
but to do so.
Responsibilities of the “réviseur d’entreprises
agréé” for the audit of the financial statements
The objectives of our audit are to obtain reasonable
assurance about whether the financial statements
as a whole are free from material misstatement,
whether due to fraud or error, and to issue a report
of the “réviseur d’entreprises agréé” that includes
our opinion. Reasonable assurance is a high level
of assurance, but is not a guarantee that an audit
conducted in accordance with EU Regulation
No 537/2014, the Law of 23 July 2016 and with the
ISAs as adopted for Luxembourg by the CSSF will
always detect a material misstatement when it
exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the
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Portrait du GroupeAudit report on the Company’s financial statements
aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with EU Regulation
N° 537/2014, the Law of 23 July 2016 and with ISAs
as adopted for Luxembourg by the CSSF, we exercise
professional judgment and maintain professional
skepticism throughout the audit. We also:
• Identify and assess the risks of material
misstatement of the financial statements, whether
due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate
to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from
fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of
internal control.
• Obtain an understanding of internal control relevant
to the audit in order to design audit procedures
that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the
effectiveness of the Company’s internal control.
• Evaluate the appropriateness of accounting
policies used and the reasonableness of accounting
estimates and related disclosures made by the
Board of Directors.
• Conclude on the appropriateness of Board of
Directors’ use of the going concern basis of
accounting and, based on the audit evidence
obtained, whether a material uncertainty exists
related to events or conditions that may cast
significant doubt on the Company’s ability to
continue as a going concern. If we conclude that
a material uncertainty exists, we are required
to draw attention in our report of the “réviseur
d’entreprises agréé” to the related disclosures in
the financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions
are based on the audit evidence obtained up to the
date of our report of the “réviseur d’entreprises
agréé”. However, future events or conditions may
cause the Company to cease to continue as a going
concern.
• Evaluate the overall presentation, structure and
content of the financial statements, including the
disclosures, and whether the financial statements
represent the underlying transactions and events in
a manner that achieves fair presentation.
• Assess whether the financial statements have been
prepared, in all material respects, in compliance
with the requirements laid down in the ESEF
Regulation.
We communicate with those charged with governance
regarding, among other matters, the planned scope
and timing of the audit and significant audit findings,
including any significant deficiencies in internal
control that we identify during our audit.
We also provide those charged with governance with
a statement that we have complied with relevant
ethical requirements regarding independence, and
communicate to them all relationships and other
matters that may reasonably be thought to bear on
our independence, and where applicable, related
safeguards.
From the matters communicated with those charged
with governance, we determine those matters that
were of most significance in the audit of the financial
statements of the current period and are therefore
the key audit matters. We describe these matters in
our report unless law or regulation precludes public
disclosure about the matter.
Report on other legal and regulatory
requirements
We have been appointed as “réviseur d’entreprises
agréé” by the General Meeting of the Shareholders on
26 May 2020 and the duration of our uninterrupted
engagement, including previous renewals and
reappointments, is 3 years.
The management report is consistent with the financial
statements and has been prepared in accordance with
applicable legal requirements.
The accompanying corporate governance statement
on pages 19 to 24 is the responsibility of the Board
of Directors. The information required by article
68ter paragraph (1) letters c) and d) of the law of
19 December 2002 on the commercial and companies
register and on the accounting records and annual
accounts of undertakings, as amended, is consistent
with the financial statements and has been prepared
in accordance with applicable legal requirements.
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Audit report on the Company’s financial statements
We have checked the compliance of the financial
statements of the Company as at 31 December 2022
with relevant statutory requirements set out in the
ESEF Regulation that are applicable to the financial
statements. For the Company, it relates to :
• Financial statements prepared in valid xHTML
format
In our opinion, the financial statements of the
Company as at 31 December 2022, have been
prepared, in all material respects, in compliance with
the requirements laid down in the ESEF Regulation.
We confirm that the audit opinion is consistent with
the additional report to the audit committee or
equivalent.
We confirm that the prohibited non-audit services
referred to in EU Regulation No 537/2014 were not
provided and that we remained independent of the
Company in conducting the audit.
Luxembourg,
31
March
2023
Anthony CANNELLA
Cabinet de révision agréé
Société anonyme
Ernst & Young
Company’s financial statements
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Company’s financial statements
1. Balance sheet at 31
st
December 2022
2022 2021
ASSETS
Note EUR EUR
FIXED ASSETS
Financial assets 3
Shares in affiliated undertakings 187,356,984.97 186,370,878.78
Loans to affiliated undertakings 120,412,500.00 187,056,434.52
307,769,484.97 373,427,313.30
CURRENT ASSETS
Debtors
Amounts owed by affiliated undertakings 4
Becoming due and payable within one year 16,325,350.98 10,195,491.23
Other debtors
Becoming due and payable within one year 153,785.88 102,752.43
16,479,136.86 10,298,243.66
Cash at bank and in hand 259,023.92 4,640.73
16,738,160.78 10,302,884.39
TOTAL ASSETS 324,507,645.75 383,730,197.69
The accompanying notes form an integral part of the financial statements.
Company’s financial statements
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Company’s financial statements
2022 2021
CAPITAL, RESERVES AND LIABILITIES Note EUR EUR
CAPITAL AND RESERVES 5
Issued capital 24,779,510.00 24,779,510.00
Share premium account 501,846.51 501,846.51
Reserves
Legal reserve 2,477,951.00 2,477,951.00
Other reserves, including the fair value reserve
Other available reserves 57,277,681.15 57,277,681.15
59,755,632.15 59,755,632.15
Profit brought forward 103,075,979.76 102,447,638.68
Profit for the financial year 33,793,761.44 10,068,154.41
Interim dividends -11,799,766.67 -1,573,302.22
210,106,963.19 195,979,479.53
CREDITORS
Amounts owed to credit institutions
Becoming due and payable within one year 18.18 24.25
Trade creditors
Becoming due and payable within one year 216,429.50 158,685.05
Amounts owed to affiliated undertakings
Becoming due and payable within one year 6 13,830,365.13 20,822,207.84
Becoming due and payable after more than one year 100,000,000.00 166,463,934.52
Other creditors
Tax authorities 86,520.00 38,190.00
Other creditors
Becoming due and payable within one year 267,349.75 267,676.50
114,400,682.56 187,750,718.16
TOTAL CAPITAL, RESERVES AND LIABILITIES 324,507,645.75 383,730,197.69
The accompanying notes form an integral part of the financial statements.
Company’s financial statements
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Company’s financial statements
2. Income statement for the year ended 31
st
December 2022
2022 2021
Note EUR EUR
Other operating income 46,068.75 0.00
Raw materials and consumables
Other external expenses -1,509,020.71 -1,542,982.22
Other operating expenses -18,139.65 -21,335.89
Income from participating interests
Derived from affiliated undertakings 7 34,212,972.00 10,244,095.77
Income from other investments and loans forming part
of the fixed assets
Derived from affiliated undertakings 8 8,835,902.76 4,931,601.83
Other interest receivable and similar income
Derived from affiliated undertakings 3,601,489.37 1,395,636.98
Other interest and similar income 2,063.34 664.52
Interest payable and similar expenses
Derived from affiliated undertakings -11,282,652.87 -1,179,855.58
Other interest and similar expenses -46,681.90 -3,753,620.70
Tax on profit or loss -6.49 -230.26
Profit or loss after taxation 33,841,994.60 10,073,974.45
Other taxes not shown above -48,233.16 -5,820.04
Profit for the financial year 33,793,761.44 10,068,154.41
Beneficiary distribution proposal
2022 2021
EUR EUR
Retained earnings 117,203,463.42 103,075,979.76
From the balance:
10% on the Board of Directors 1,966,627.78 943,981.33
90% to 14,159,720 shares 17,699,650.00 8,495,832.00
136,869,741.20 112,515,793.09
Dividend per share 1.25 0.60
The accompanying notes form an integral part of the financial statements.
Company’s financial statements
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3. Notes to the financial statements for the year 2022
Note 1. Overview
The company was incorporated on 5
th
December 1959
as a public limited company and adopted the status of
“Soparfi” on 10
th
January 2011.
The duration of the company is unlimited, and its
registered office is established in Luxembourg. The
company is registered in the Register of Commerce
and Companies under number B5937 and is listed on
the Luxembourg Stock Exchange under ISIN number
LU0027967834.
The object of the company is (i) the acquisition,
holding and disposal, in any form whatsoever and by
any means, directly or indirectly, of participations,
rights and interests, as well as bonds of Luxembourg or
foreign companies, (ii) the acquisition by contribution,
purchase, subscription or otherwise, as well as the
disposal by sale, transfer, exchange or otherwise,
of shares, interests, bonds, debts, notes and other
securities or financial instruments of any kind (in
particular bonds or shares issued by Luxembourg or
foreign collective investment funds or any other
similar body), loans or any other credit line, as well
as contracts relating thereto and (iii) the holding,
administration, development and management of
a portfolio of assets (composed in particular of the
assets described in points (i) and (ii) above).
The company may also acquire and develop any
patents and other rights relating to or supplementing
those patents.
The company may borrow in any form whatsoever. It
may enter into any kind of loan agreement and may
issue debt securities, bonds, certificates, shares,
profit shares, warrants and all kinds of debt and equity
securities, including by virtue of one or several issue
programmes. The company may lend funds, including
those resulting from borrowings and/or securities
issues, to its subsidiaries, affiliates and any other
company.
The company also prepares consolidated financial
statements which are published in accordance with
the law and which are available at the company’s
registered office (4, avenue Guillaume, L-1650
Luxembourg) or on the Internet site: www.socfin.com.
The financial year begins on 1
st
January and ends on
31
st
December.
Note 2. Accounting principles, rules and methods
General principles
The annual financial statements are prepared in
accordance with Luxembourg legal and regulatory
requirements in force in Luxembourg under the
historical cost convention.
The accounting policies and valuation principles
are, apart from the rules imposed by the law of
19
th
December 2002, determined and implemented by
the Board of Directors.
The preparation of the annual financial statements
involves the use of a number of critical accounting
estimates. It also requires the Board of Directors
to exercise its judgement in the application of
accounting principles. Any change in assumptions may
have a significant impact on the financial statements
for the period in which the assumptions are changed.
The Board of Directors believes that the underlying
assumptions are appropriate and that the financial
statements give a true and fair view of the financial
position and results of the company.
Company’s financial statements
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Currency conversion
The company keeps its accounts in euros (EUR); the
annual accounts are expressed in the same currency.
Transactions in a currency other than the balance
sheet currency are converted into the balance sheet
currency at the exchange rate prevailing on the date
of the transaction.
At the balance sheet date:
- the acquisition price of the financial assets, expressed
in a currency other than the currency of the balance
sheet, remain converted at the historical exchange
rate, with the exception of the current portion
of receivables, which is valued individually at the
lower of their historical exchange rate value or their
value determined on the basis of the exchange rate
prevailing at the balance sheet date;
- bank accounts expressed in a currency other than
the currency of the balance sheet are valued on the
basis of the exchange rate prevailing on the balance
sheet date. Foreign exchange gains and losses are
recognised in the current period;
- all other assets, expressed in a currency other
than the currency of the balance sheet, are valued
individually at the lower of their value at the
historical exchange rate or their value determined
on the basis of the exchange rate prevailing at the
balance sheet date;
- all liability items, expressed in a currency other
than the currency of the balance sheet, are valued
individually at the highest of their value at the
historical exchange rate or their value determined
on the basis of the exchange rate prevailing on the
balance sheet.
Realised foreign exchange gains and losses and
unrealised losses are recognised in the profit and loss
account. Unrealised foreign exchange gains are not
recognised.
If there is an economic link between two transactions,
unrealised exchange differences are recognised at the
corresponding unrealised exchange loss.
Valuation of financial assets
Shares in affiliated undertakings are valued at
acquisition cost, which includes incidental expenses.
Receivables from affiliated companies are valued
at their nominal value, which includes incidental
expenses.
In the event of an impairment that, in the opinion of
the Board of Directors, is of a lasting nature, these
financial fixed assets are subject to value adjustments
in order to give them the lower value that should
be attributed to them on the balance sheet date, as
determined by the Board of Directors.
In order to determine the value adjustments that are
permanent at the balance sheet date, the Board of
Directors carries out the following analyses for each
investment on an individual basis:
1/ For investments listed on public markets, the
Board of Directors compares the net book value of
the investment with its shares in the market based on
the stock market price at the closing date. When the
market value is greater than or equal to the net book
value, the Board of Directors considers that no value
adjustment needs to be recorded at the closing date.
However, when the market value is lower than the net
book value, the Board of Directors tests the net book
value against the share in the revalued net assets of
the investment.
2/ If the net book value exceeds the market value or
the equity value for unlisted investments, the Board
of Directors compares the net book value with the
share held in the revalued net assets as well as in
the consolidated net assets (i.e. equity attributable
to owners of the parent company) if the subsidiary
prepares consolidated accounts.
If one of these values is greater than or equal to the
net book value of the investment, no value adjustment
is recognised.
3/ When both values are lower than the net book
value of the investment:
• for support companies (other than plantations
or industrial companies), the Board of Directors
records the value adjustment resulting from the
smaller difference between the net book value of
Company’s financial statements
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the investment and the share held in the revalued
net assets or in the consolidated net assets;
• for investments in plantations or industrial companies,
the Board of Directors makes a value adjustment
to bring the carrying value at the enterprise value
calculated on the basis of the discounted future
cash flows available to the shareholders, which take
into account the foreseeable development of the
business of the investments under test.
However, the Board of Directors may take other factors
into consideration and, in particular, in view of the
very long period of immaturity of young plantation, it
considers that the value adjustment is not permanent
for a plantation where more than half of the planted
area is not being used.
Loans to affiliated companies are subject to a value
adjustment in the event that the net book value test
by discounting future cash flows to shareholders does
not support the full repayment of the receivable.
These value adjustments are not maintained when the
reasons for which they were established have ceased
to exist.
Receivables
Receivables are recorded at their nominal value.
They are subject to value adjustments when their
recovery is compromised. These value adjustments
are not continued if the reason for which the value
adjustments were made have ceased to apply.
Liabilities
Debts are recorded at their reimbursement value.
When the amount to be repaid on the debts exceeds
the amount received, the difference is recorded to
the profit and loss account.
Russia – Ukrain conflict
In February 2022, a number of countries (including
the US, UK and EU) imposed sanctions against certain
entities and individuals in Russia as a result of the
official recognition of the Donetsk People Republic and
Lugansk People Republic by the Russian Federation.
Announcements of potential additional sanctions have
been made following military operations initiated by
Russia against the Ukraine on 24
th
February 2022.
Due to the geopolitical tensions since February 2022,
there has been a significant increase in volatility on
the securities and currency markets, as well as a
significant depreciation of the ruble against the US
dollar and the euro.
Although neither the company’s performance and
going concern nor operations, have been significantly
impacted by the above during 2022, the Board of
Directors continues to monitor the evolving situation
and its impact on the financial position and results of
the company.
Company’s financial statements
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Note 3. Financial fixed assets
Shares in affiliated undertakings Loans to affiliated undertakings Total
2022 2021 2022 2021 2022 2021
EUR EUR EUR EUR EUR EUR
Acquisition cost nominal value at
the beginning of the year
186,370,878.78 186,370,890.33 187,056,434.52 90,592,500.00 373,427,313.30 276,963,390.33
Increases
1,049,628.23 0.00 0.00 96,463,934.52 1,049,628.23 96,463,934.52
Decrease
-63,522.04 -11.55 -66,643,934.52 0.00 -66,707,456.56 -11.55
Acquisition cost nominal value at
the end of the year
187,356,984.97 186,370,878.78 120,412,500.00 187,056,434.52 307,769,484.97 373,427,313.30
Value adjustments at the beginning and
at the end of the year
0.00 0.00 0.00 0.00 0.00 0.00
Net book value at the end of the year
187,356,984.97 186,370,878.78 120,412,500.00 187,056,434.52 307,769,484.97 373,427,313.30
Information on movements during the year
During the year, the Company has acquired: 31,494 shares of
Socfinasia, resulting in a change of percentage holding from
58.09% to 58.25%; 22,299 shares of Socfinaf, resulting in a
change of percentage holding from 64.51% to 64.64%;
1,000 shares of Management Associates, resulting in a change of
percentage holding from 20.00% to 30.00%.
During the year, the company has sold: 10 shares of Brabanta.
Information on companies in which the company holds at least 20% of the capital
Entity Country % held
Net book value
EUR Year end
Currencies
of the
annual
accounts
Net equity at
31/12/2022
Net result at
31/12/2022
Socfinaf (**) Luxembourg 64.64 137,565,946 31/12/2022 EUR 221,253,702 -37,542,749
Socfinasia (**) Luxembourg 58.25 49,071,662 31/12/2022 EUR 452,144,231 70,684,907
Induservices (*) Luxembourg 35.00 35,000 31/12/2022 EUR 327,636 88,113
Management Associates (*) Luxembourg 30.00 637,500 31/12/2022 EUR 2,456,079 -243,572
187,310,108
(*) Based on unaudited financial statements at 31
st
December 2022.
(**) Based on audited financial statements at 31
st
December 2022.
Valuation of shares in affiliated undertakings
At 31
st
December 2022, the Board of Directors is of the opinion
that there is no permanent value decrease for the shares in
affiliated undertakings.
Information and valuation of loans to affiliated
undertakings
At 31
st
December 2022, the loans to affiliated undertakings are
mainly comprised:
- of receivables from Socfinaf for a nominal amount of
EUR 120,000,000 (2021: EUR 120,000,000) and which bear a fixed
interest rate of 4.25%. The maturity of the receivable is fixed on
10
th
November 2026.
At 31
st
December 2022, the Board of Directors are of the opinion
that these loans are recoverable as such, no impairment loss has
been accounted for.
Company’s financial statements
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Company’s financial statements
Note 4. Amounts owed by affiliated undertakings
The amounts owed by affiliated undertakings mainly consist of
an advance granted to Socfinaf for an amount of USD 14,750,000
(2021: USD 10,000,000) bearing interest at a variable rate.
At 31
st
December 2022, the Board of Directors is of the opinion
that the amounts are fully recoverable and as such, no impairment
has been accounted for.
Note 5. Equity
Issued
capital
EUR
Share
premium
EUR
Legal
reserve
EUR
Other
reserves
EUR
Retained
earnings
EUR
Profit for
the year
EUR
Interim
dividends
EUR
Situation at 1
st
January 2021
24,779,510.00 501,846.51 2,477,951.00 57,277,681.15 93,782,497.98 8,665,140.70 0.00
Allocation of the result for the 2020
financial year following decision of
the General Meeting
held on 25
th
May
2021:
• Retained earnings
8,665,140.70 -8,665,140.70
Interim dividends as per decision
of the Board of Directors of
26
th
October 2021
-1,573,302.22
Financial year profit for 2021
10,068,154.41
Situation at 31
st
December 2021
24,779,510.00 501,846.51 2,477,951.00 57,277,681.15 102,447,638.68 10,068,154.41 -1,573,302.22
Distribution of the result for the 2021
financial year following decision of the
General Meeting held on 31
st
May 2022:
• Retained earnings
628,341.08 -628,341.08
•
Dividends
-7,079,860.00
• Director’s fees
-786,651.11
• 2021 interim dividend
-1,573,302.22 1,573,302.22
Interim dividends as per decision
of the Board of Directors of
27
th
October 2022
-11,799,766.67
Financial year profit for 2022
33,793,761.44
Situation at 31st December 2022
24,779,510.00 501,846.51 2,477,951.00 57,277,681.15 103,075,979.76 33,793,761.44 -11,799,766.67
Issued capital
At 31
st
December 2022 and 2021, the issued and fully paid capital
is EUR 24,779,510 represented by 14,159,720 shares without
nominal value.
Share premium
At 31
st
December 2022 and 2021, the share premium amounts to
EUR 501,846.
Legal reserve
The annual profit is subject to a levy of 5% to be allocated to a
legal reserve. This allocation ceases to be compulsory as soon as
the reserve reaches 10% of the capital. The legal reserve cannot
be distributed.
Note 6. Amounts to affiliated undertakings
At 31
st
December 2022, the amounts owed to affiliated
undertakings mainly consist of:
- a debt to Socfinasia for a nominal amount of EUR 100,000,000
(2021: EUR 100,000,000) plus accrued interest of EUR 400,000
(2021: EUR 583,333) and which bear a fixed interest rate of 4%.
This debt is repayable early or at the latest on 10
th
November
2026.
- a debt to PNS Ltd for a nominal amount of EUR 13,160,033
(2021: EUR 8,829,242) plus accrued interest of EUR 269,045
(2021: EUR 500,533). This debt bears interest at a variable rate
and is repayable within one year.
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Portrait du Groupe
Company’s financial statements
Note 7. Income from participating interests
2022 2021
EUR EUR
Dividends received
34,212,972 10,244,095
This amount corresponds to the dividend received
from the affiliated undertakings (Note 3).
Note 8. Income from other investments and loans forming part of the fixed
assets
2022 2021
EUR EUR
Interest on related companies’ receivables
8,835,903 4,931,601
This amount corresponds to interest income received on the loans granted by affiliated undertakings (Note 3).
Note 9. Taxation
The company is subject to all taxes to which
Luxembourg commercial companies are subject to.
Note 10. Remuneration of the Board of Directors
During the 2022 financial year, the remuneration of
the Board members amounted to EUR 8,750 (2021:
EUR 10,312) as attendance fees and EUR 1,966,628
(2021: EUR 157,330) as directors’ fees.
During 2022, no advances or loans were granted to the
Board members.
Note 11. Political and economic environment
The company holds interests in companies that
operate indirectly in Africa and South-East Asia.
Given the economic and political instability in these
African countries (Sierra Leone, Liberia, Côte d’Ivoire,
Ghana, Nigeria, Cameroon, São Tomé and Principe and
Democratic Republic of Congo) and South-East Asia
(Cambodia and Indonesia), these holdings are exposed
to political and economic fluctuations risks.
Note 12. Off-balance sheet commitments
At 31
st
December 2022 and 2021, the company
guaranteed the repayment of the loan of
USD 100,000,000 from PNS Ltd with a financial
institution.
Note 13. Significant events after the year end
At 24
th
February 2023, the company early repaid an
amount of USD 14,750,000 i.e. EUR 13.160.033 to
PNS Ltd as a final reimbursement of the loan.