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SOFISA SA,
Fribourg
Consolidated Financial Statements for the year
ended December 31, 2024, and Report of the
Statutory Auditor
Deloitte SA
Rue Saint
-Martin 7
1003 Lausanne
Switzerland
Tel: +41 (0)58 279 92 00
Fax: +41 (0)58 279 93 00
www.deloitte.ch
Report of the Statutory Auditor
To the General Meeting of
SOFISA SA, Fribourg
Report on the Audit of the Consolidated Financial Statements
Opinion
We have audited the consolidated financial statements of SOFISA SA (the Company) and its subsidiaries
(the Group), which comprise the consolidated statement of financial position as at December 31, 2024,
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 notes to the consolidated
financial statements, including material accounting policy information.
In our opinion, the accompanying consolidated financial statements give a true and fair view of the
consolidated financial position of the Group as at December 31, 2024, and of its consolidated financial
performance and its consolidated cash flows for the year then ended in accordance with IFRS
Accounting Standards and comply with Swiss law.
Basis for Opinion
We conducted our audit in accordance with Swiss law, International Standards on Auditing (ISA) and
Swiss Standards on Auditing (SA-CH). Our responsibilities under those provisions and standards are
further described in the “Auditor's Responsibilities for the Audit of the Consolidated Financial
Statements” section of our report. We are independent of the Group in accordance with the provisions
of Swiss law, together with the requirements of the Swiss audit profession, as well as those of the
International Ethics Standards Board for Accountants’ International Code of Ethics for Professional
Accountants (including International Independence Standards) (IESBA Code), and we have fulfilled our
other ethical responsibilities in accordance with these 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 our 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.
SOFISA SA
Report of the statutory auditor
for the year ended
December 31, 2024
Revenue from land sales and sales of single-family detached homes built on speculation and individual
residential units in multifamily buildings
Key audit matter
How the scope of our audit responded to the key audit
matter
The group has various streams of revenue
We performed a process walkthrough to gain an
including revenue from land sales and sales of
understanding of the controls in place related to the real
single-
family detached homes built on
estate revenue recognition process. We tested design and
speculation and individual residential units in
implementation of the relevant controls.
multi-family buildings accounted for as a sale
We obtained the listing of residential property sales
of goods under IFRS 15 (Revenue from
recorded for the financial year 2024. We reviewed Board of
Contracts with Customers). There is a risk that
Directors minutes for detail of sales transaction during the
these revenues recorded do not meet all the
year to ensure the listing was complete.
revenue recognition criteria under IFRS 15
due to the terms and conditions of the sale
We selected a sample of sales transactions for detailed
contract that require management
testing and used the amounts tested to develop an
judgement to assess whether all the criteria
expectation for the rest of the population. We then
have been fulfilled. These revenue streams
compared this expectation to the actual revenue recorded.
amount to CHF 70.89
million for the year
The detailed testing consisted of the following steps:
ended December 31, 2024 (corresponding to
- We reconciled the details of the sale to the sale contract
CHF 64.22
million for the year ended
and reviewed the agreement for any terms and conditions
December 31, 2023) for revenue from single-
that could affect the group's ability to recognize revenue, as
family detached homes built on speculation
well as the appropriateness of recognizing revenue at a
and individual residential units in multi-family
specific point in time rather than over a period of time.
buildings.
- We reconciled the revenue amount and agreed the date
The revenue recognition methods according
when the revenue was recorded to the closing statement
to IFRS 15 require management judgments
prepared by the lawyer indicating the release of the sales
and are therefore assessed as a key audit
proceeds to the group and the transfer of the title to the
matter. Refer to the accounting policy in note
buyer.
4 and additionally the revenue details in note
- We reconciled the proceeds (deposit and final payment)
25.
with the evidence of receipt.
- Late cut-off was also tested through a review of the sales
recorded subsequent to year end.
-
We assessed the adequacy and completeness of the
revenue related disclosures according to IFRS 15 by critical
review.
Based on the procedures performed above, we obtained
sufficient audit evidence to address the risk of incorrect
application of IFRS 15 to the Revenue from land sales and
sales of single-family detached homes built on speculation
and individual residential units in multifamily buildings.
SOFISA SA
Report of the statutory auditor
for the year ended
December 31, 2024
Other Information
The Board of Directors is responsible for the other information. The other information comprises the
information included in the annual report, but does not include the consolidated financial statements,
the stand-alone financial statements of the Company, the remuneration report and our auditor’s reports
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 that fact. We have nothing to report in this regard.
Board of Directors’ Responsibilities for the Consolidated Financial Statements
The Board of Directors is responsible for the preparation of the consolidated financial statements, which
give a true and fair view in accordance with IFRS Accounting Standards and the provisions of Swiss law,
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.
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.
The Board of Directors is responsible for presenting the annual accounts in compliance with the relevant
requirements set out in ESEF Regulation that are applicable to financial statements.
Auditor's Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives 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 an auditor’s
report that includes our opinion. Reasonable assurance is a high level of assurance but is not a
guarantee that an audit conducted in accordance with Swiss law, ISA and SA-CH 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.
A further description of our responsibilities for the audit of the consolidated financial statements is
located on EXPERTsuisse’s website at: https://www.expertsuisse.ch/en/audit-report. This description
forms an integral part of our report.
SOFISA SA
Report of the statutory auditor
for the year ended
December 31, 2024
Report on Other Legal and Regulatory Requirements
In accordance with Art. 728a para. 1 item 3 CO and SAS-CH 890, we confirm that an internal control
system exists, which has been designed for the preparation of the consolidated financial statements
according to the instructions of the Board of Directors.
We confirm the compliance of the consolidated financial statements of the Group as at December 31,
2024, with the relevant requirements set out in the ESEF Regulation that are applicable to financial
statements.
For the Group it relates to:
- Consolidated financial statements prepared in a 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 December 31, 2024, identified
as sofisa-2024-12-31-en.zip, have been prepared, in all material respects, in compliance with the
requirements laid down in the ESEF Regulation.
We recommend that the consolidated financial statements submitted to you be approved.
Deloitte SA
Annik Jaton Hüni Antony Rullo
Licensed Audit Expert Licensed Audit Expert
Auditor in Charge
Lausanne, April 28, 2025
Enclosures
- Consolidated financial statements (statement of consolidated financial position, statement of
consolidated comprehensive income, statement of consolidated changes in equity, statement of
consolidated cash flows and notes)
SOFISA SA
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
in CHF
Notes
31/12/2024
31/12/2023
ASSETS
Current assets
Cash and cash equivalents
7
51,882, 202
10,064, 262
Restricted cash
8
2,387, 240
958,283
Securities
9/28
344,249, 307
405,577, 181
Trade and other receivables
10
3,652, 466
1,068, 299
Current tax assets
11
3,879, 761
1,801, 946
Inventories
13
110,078, 667
121,539, 269
Other current assets
14
1,354, 288
1,248, 889
Total current assets
517,483,931
542,258,129
Non-current assets
Property, plant and equipment, net
15
712,694
647, 454
Investment in non-consolidated companies
16
8,072, 846
10,166, 375
Other non-current assets
14
599,323
663, 308
Retirement benefit asset
12
488,580
500, 811
Deferred tax assets
11
3,394, 840
4,135, 426
Total non-current assets
13,268,283
16,113, 374
Total assets
530,752,214
558,371,503
- 1 -
SOFISA SA
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
in CHF
Notes
31/12/2024
31/12/2023
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Trade and other payables
11,308, 803
8, 513,728
Current tax liabilities
11
16, 388, 181
197,989
Short term part of borrowings
18
36, 961, 558
30,748, 800
Other current liabilities
17
28, 352, 259
23,719, 295
Total current liabilities
93,010,801
63,179,812
Non-current liabilities
Retirement benefit obligation
12
360,984
375,257
Deferred tax liabilities
11
21,264, 727
21,834,149
Preferential shares
19
2,252, 925
2, 256, 300
Long term part of borrowings
18
31,716, 796
10,324,500
Other non-current liabilities
17
569,365
645,584
Total non-current liabilities
56,164,797
35,435,790
Total liabilities
149,175,598
98,615,602
Shareholders' equity
Share capital
20
3,960, 000
3, 960, 000
Own capital shares
21
(149, 252, 768)
0
Reserves
22
171,560, 000
171, 560,000
Retained earnings
23
387,532, 472
316, 111,928
Cumulative translation adjustment
24
(32, 223, 088)
(31, 876, 027)
Total shareholders' equity
381,576,616
459,755,901
Total liabilities and shareholders' equity
530,752,214
558,371,503
- 2 -
SOFISA SA
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
for the year ended
in CHF
Notes
31/12/2024
31/12/2023
Continuing operations
Sales revenue
25
70,893, 180
65,360, 381
Investment income
26
98,133,969
41, 501,689
Other income
13,657
0
Total operating income
169,040,806
106,862,070
Cost of sales
(63, 995, 420)
(50, 474, 371)
Other operating costs
(9, 638, 259)
(9, 356, 020)
Total operating costs
(73, 633,679)
(59,830, 391)
EBIT
Earnings before interest and tax
95,407,127
47,031,679
Other financial income
26
3,377, 795
814,410
Financial expenses
27
(2, 927, 806)
(5, 339, 046)
EBT Earnings before tax
95,857,116
42,507,043
Tax expense
11
(16, 518, 633)
(539, 549)
Deferred tax expense
11
(118, 665)
(5,860, 165)
NET PROFIT FOR THE YEAR
79,219,818
36,107,329
Other comprehensive income
Items that may be subsequently reclassified to profit or loss
Foreign currency translation24
(347, 061)
(2,728, 261)
Items that may not be subsequently reclassified to profit or loss
Remeasurement losses/(gains) of post employ-
ment benefit obligations
12
36,420
(44, 107)
Deferred tax (expense) / credit11
(9, 833)
11,909
Exchange translation differences of foreign
operations
(5, 860)
(8, 564)
TOTAL COMPREHENSIVE INCOME FOR THE YEAR
78,893,483
33,338,306
- 3 -
SOFISA SA
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Own Cumulative
Notes
Share
capital
Retained
translation
Reserves
Total
in CHF
Capital
shares
earnings
differences
Equity
Balance at 1 January 2023
3,960, 000
0
287,865, 361 (29, 147,766)
171,560, 000
434,237, 595
Net profit
0
0
36,107, 329
0
0
36,107, 329
Other comprehensive income
0
0
(40, 762)
(2, 728,261)
0
(2, 769,023)
Total comprehensive income for the
period
0
0
36,066,567
(2,728,261)
033,338,306
Dividends
0
0
(7, 820,000)
0
0
(7, 820,000)
Balance at 31 December 2023
3,960,000
0
316,111,928
(31,876,027)
171,560,000
459,755,901
Balance at 1 January 2024
3,960, 000
0
316,111, 928
(31, 876,027)171,560, 000 459,755, 901
Own capital shares
21
(149, 252,768)
(149, 252,768)
Net profit
0
0
79,219,818
0
0
79, 219,818
Other comprehensive income
0
0
20,726
(347, 061)
0
(326, 335)
Total comprehensive income for the
period
0
0
79,240,544
(347,061)
0
78,893,483
Dividends
23
0
0
(7, 820,000)
0
0
(7, 820, 000)
Balance at 31 December 2024
3,960,000
(149,252,768)
387,532,472
(32,223,088)
171,560,000
381,576,616
- 4 -
SOFISA SA
CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended
in CHF
Notes
31/12/2024
31/12/2023
Cash flow generated by / (used in) operating activities
Net profit
79,219,818
36,107,329
Adjustments for :
Non cash items in net profit and other adjustments
Depreciation and amortization
117,306
88,878
Tax expense recognised in profit or loss
11
16,637,298
6,399, 714
Unrealised (gain) / loss on securities
26
(18, 922,945)
(35, 259,223)
Other financial income
26
(512, 668)
(814,000)
Interest expense recognised in profit or loss
3,365,094
1,925, 644
Net (increase) / decrease in operating assets
Securities
9/29
80,250, 819
(5,371, 622)
Trade and other receivables
10
(4, 013,124)
8,739,628
Inventories
13
9,899,233
12,953,656
Other assets
14
(29, 183)
775,536
Net increase / (decrease) in operating liabilities
Trade and other payables
17
2,795,075
2,794,196
Accrued expenses and deferred income
11
4,632,964
984,670
Other liabilities
(14, 273)
0
Income taxes paid
(2, 353,757)
(1, 752,633)
Net cash flow generated by / (used in) operating activities
171,071,657
27,571,773
Cash flow generated by / (used in)
investing activities
(Purchase) of property, plant and equipment
15
(182,546)
(132,512)
Proceeds from investment in non-consolidated companies
2, 390,485
377,393
(Payment in connection with) investment
in
non-consolidated companies
16
(296,956)
(1, 574,988)
Interest received
26
512,668
814,000
Net cash flow generated by / (used in) investing activities
2,423, 651
(516,107)
- 5 -
SOFISA SA
CONSOLIDATED STATEMENT OF CASH FLOWS (continued)
for the year ended
in CHF
31/12/2024
31/12/2023
Cash flow generated by / (used in) financing activities
Purchase of own capital shares for
subsequent cancellation
21
(149, 252,768)
0
(Repayment) of short term borrowings
18
0
(22, 793,645)
Proceeds from short term borrowings
6,589,615
1,413, 707
(Repayment) of long term borrowings
18
(76, 219)
(138,006)
Proceeds from long term borrowings
18
21,524,931
1,594,530
Interest paid on preference shares
(102, 600)
(111,600)
Borrowing costs
27
(3,265, 869)
(1,818, 544)
Dividends paid
(7,820, 000)
(7,820, 000)
Net cash flow (used in)/generated by financing activities
(132,402,910)
(29,673,558)
Effects of exchange rate differences
725,542
3,968,691
Net increase/(decrease) in cash and cash equivalents
41,817,940
1,350, 799
Cash and cash equivalents at beginning of the year
10,064,262
8,713, 463
Cash and cash equivalents at the end of the year
51,882,202
10,064,262
- 6 -
SOFISA SA
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1) SOFISA’S BUSINESS ACTIVITIES
SOFISA SA is a holding company incorporated in 1930 and organised under Swiss law. The
company owns interests in several wholly-owned or majority owned subsidiaries, established
in various countries. The Company, together with its subsidiaries, forms the Sofisa Group. The
Sofisa Group conducts activities in residential real estate development in Canada and USA
and further holds a diversified investment portfolio to provide finance for the Group.
SOFISA SA is a public limited company with its head office in Grand-Places 14, Fribourg,
Switzerland, where it is also registered. The share capital of the company is fixed at the sum
of six million one hundred sixty-five thousand Swiss francs (CHF 6,165,000); it is divided into
seven thousand nine hundred twenty (7,920) ordinary shares, numbered 1 to 7,920, of CHF
250 each and seven thousand nine hundred twenty (7,920) preference shares, numbered
7,921 to 15,840, of CHF 250 each and nine thousand (9,000) preference shares, numbered
15,841 to 24,840, of CHF 245 each. The shares numbered 7,821 to 7,920 have a preferred
dividend right. The shares numbered 7,921 to 15,840 have a preferred dividend right and
preferred liquidation right. The shares numbered 15,841 to 24,840 have a preferred dividend
right and privileged voting rights. The shares numbered 15,841 to 24,840 in SOFISA SA are
traded on the Luxembourg Stock Exchange under securities no 296855294 (ISIN
CH1402090877).
2) PRINCIPLES OF CONSOLIDATION AND FINANCIAL REPORTING
GENERAL PRINCIPLES: The consolidated financial statements for the Sofisa Group are based
on the financial statements of the individual companies within the Group as per
December 31, which have all been prepared in a consistent manner.
The consolidated financial statements are prepared in accordance with International
Financial Reporting Standards (IFRS) as issued by the International Accounting Standards
Board (IASB) and are also prepared in accordance with IFRS adopted by the European Union.
The consolidated financial statements have been prepared on the basis of original values at
acquisition, non-monetary assets being valued, in principle, at acquisition or cost or at market
values, if lower. Securities and certain financial assets are measured at fair value. Certain
portfolio holdings consist of shares in funds principally invested in instruments ranging from
equities to currencies and commodities, all traded on a securities exchange.
Details concerning valuation are given in the accounting policies indicated below.
3) ADOPTION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRSs)
The accounting policies, presentation and methods of computation, are the same as those
applied in the 2023 consolidated financial statements, except for the Group’s adoption of
new and amended IFRSs effective January 1, 2024.
In the current financial year several new standards and amendments were adopted effective
January 1, 2024, but had no material impact on the Group consolidated financial statements.
- 7 -
SOFISA SA
At the date of authorisation of these consolidated financial statements, the following
Standards and Interpretations were issued and effective in 2024:
- Amendments to IAS 1 : Classification of Liabilities as Current or Non-Current
- Amendments to IFRS 16 : Lease Liability in a Sale and Leaseback
- Amendments to IAS 1 : Non-current Liabilities with Covenants
- Amendments to IAS 7 and IFRS 7: Supplier Finance Arrangements
In the current financial year several new standards and amendments were adopted effective
January 1, 2024, but had no material impact on the Group consolidated financial statements.
At the date of authorisation of these consolidated financial statements, the following
Standards and Interpretations which have not been applied in these financial statements
were issued but not yet effective:
- Amendments to IFRS 9 and IFRS 7 : Classification and Measurement of Financial Instruments
- Annual improvements to IFRS Accounting Standards - Volume 11
- IFRS 18 : Presentation and Disclosures in Financial Statements
- IFRS 19 : Subsidiaries without Public Accountability: Disclosures
The Directors anticipate that the application of IFRS 18 may have an impact on the
consolidated financial statements of the Group in future periods.
The directors do not expect that the adoption of the standards listed above, except for IFRS
18, will have a material impact on the consolidated financial statements of the Group in
future periods. However, these amended standards could lead to a few additional
disclosures.
4) SIGNIFICANT ACCOUNTING POLICIES
SCOPE OF THE CONSOLIDATED STATEMENTS: The consolidated financial statements for Sofisa
Group cover SOFISA SA and all the entities controlled by the Company. Subsidiaries are those
companies controlled directly or indirectly by the parent through a majority of votes or by
other means. Control is achieved when the parent has the power over the investee; is
exposed, or has right, to variable return from its involvement with the investee; and has the
ability to use its power to affect its return.
METHOD OF CONSOLIDATION: The consolidated financial statements represent the
aggregation of the annual accounts of the individual Group companies, which are prepared
using uniform accounting principles.
The financial statements of the parent and its subsidiaries are prepared as of the same end
of the reporting period. Assets and liabilities, and income and expenses of a subsidiary are
included in the consolidated financial statements from the date that control is acquired until
the date on which the parent ceased to control the subsidiary. All intra-group transactions,
balances, income and expenses are eliminated on consolidation.
INVESTMENTS IN NON-CONSOLIDATED COMPANIES: Investment in company not accounted
for as subsidiary, associates or jointly controlled entities are stated at fair value through profit
or loss, as per IFRS 9.
GOING CONCERN: The Board of directors has, at the time of approving the financial
statements, a reasonable expectation that the Group has adequate resources to continue
in operational existence for the foreseeable future. Thus they continue to adopt the going
concern basis of accounting in preparing the financial statements.
- 8 -
SOFISA SA
SIGNIFICANT ACCOUNTING ESTIMATES AND MANAGEMENT JUDGMENTS: In preparing the
consolidated financial statements, management is required to make estimates and
assumptions that affect reported income, expenses, assets, liabilities and disclosure of
contingent assets and liabilities. The estimates and associated assumptions are based on
historical experience and other factors that are considered to be relevant. Actual results may
differ from those estimates.
Significant estimates used in the preparation of these consolidated financial statements and
judgements made by management in the application of IFRSs that have significant effect on
the financial statements are discussed below.
KEY SOURCES OF ESTIMATION UNCERTAINTY:
Key components of the consolidated financial statements requiring management to make
significant estimates include the determination of percentage of completion in respect of
revenue recognition for certain contracts, allocation of development costs to specific areas
under development and ultimately to costs of sales, cost to completed accruals and the
recoverability of certain phases of development, income taxes, and liabilities under legal
contingencies. Actual result could differ from these estimates.
Balances related to long term revenue contracts in progress and revenues have been
calculated using management’s best estimates of total costs. Total estimated cost is a
component of the percentage of completion. Due to the uncertainties in the estimation
process, it is possible that changes in future conditions may cause recorded amounts to
materially change in the future. The cumulative effect of revisions to revenue or deficiencies
in the estimate recovery of individual phases within residential property under development
is recorded in the period in which amounts are known.
CRITICAL ACCOUNTING JUDGEMENT:
Revenues from sales of land and completed single-family detached home on a specific
parcel or completed residential units in multi-family buildings: Revenues from such
transactions are recognised at a point in time. This revenue recognition method requires
management judgments to determine when the revenue recognition criteria are fulfilled in
accordance with the requirements of IFRS 15, Revenue from Contracts with Customers.
FUNCTIONAL CURRENCY AND CONVERSION OF FOREIGN CURRENCIES: The Group’s
consolidated financial statements are prepared in Swiss francs (CHF).
For certain companies within the Group, transactions that are carried out in a foreign
currency are converted using a fixed exchange rate. At closure, monetary assets and
liabilities in foreign currencies are converted into the functional currency of the company
using year-end rates. The resulting exchange differences are recorded in profit or loss. Non-
monetary items that are measured in terms of historical cost in a foreign currency are not
retranslated.
In the Group’s consolidated financial statements, the assets and liabilities from the statements
of financial positions of foreign subsidiaries prepared in a foreign currency have been
translated into Swiss franc using year-end rates. The statements of profits or losses and other
comprehensive income and cash flows have been translated using the average exchange
rates for the year.
Exchange differences arising on the net assets of foreign subsidiaries as a result of changes in
exchange rates compared to the previous year and translation differences arising from the
calculation of the Group’s results using average annual exchange rates and year-end rates
are recognised directly in other comprehensive income and reported separately as
cumulative translation differences. Cumulative translation differences will be recognised in
the profit or loss when a subsidiary is sold or liquidated.
- 9 -
SOFISA SA
The principal exchange rates against the Swiss franc in relation to the consolidated financial
statements are as follows:
Statement of Statement of profit or loss and
Financial position* other comprehensive income **
Exchange rates 2024 2023 2024 2023
1 USD
0.9063
0.8416
0.8801
0.8988
1 EUR
0.9385
0.9297
0.9524
0.9717
1 CAD
0.6301
0.6383
0.6427
0.6659
1 GBP
1.1350
1.0729
1.1251
1.1171
1 AUD
0.5611
0.5743
0.5809
0.5971
1 NZD
0.5077
0.5329
0.5327
0.5518
100 JPY
0.5766
0.5969
0.5815
0.6410
100 SEK
8.2021
8.3512
8.3318
8.4699
100 HKD
11.6668
10.7781
11.2801
11.4803
100 NOK
7.9796
8.2872
8.1924
8.5143
100 SGD
66.4318
63.8026
65.8769
66.9166
100 DKK
12.5843
12.4715
12.7684
13.0407
100 ILS
24.8727
23.3725
23.9075
24.3204
* Year-end rates ** Average rates for the year
FINANCIAL ASSETS AND LIABILITIES: The financial assets and liabilities are classified into the
following specified categories:
Financial assets are classified as fair value through profit or loss if they are acquired with a
view to realising a profit from short-term fluctuations in the price and measured at fair value.
The resulting realised and unrealised changes in value are recognised in profit or loss and are
included in the financial result for the relevant reporting period. Included in this category of
financial assets are the securities which include marketable, easily realisable securities and
time deposits with an original maturity of 3 to 12 months.
Loans and receivables are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market. They reach the objective of collecting
contractual cash flows over their life. This type of financial instrument, including in particular
trade receivables, loans and other receivables, is measured in the statement of financial
position at amortised cost using the effective interest rate method less any impairment.
Interest income is recognised by applying the effective interest rate method, except for short-
term receivables when the recognition of interest would be immaterial.
Trade receivables are carried at amortised cost less allowances for loss. They generally do not
contain a significant financing component. The allowance loss measurement is then
determined by applying a simplified approach equalling the lifetime expected credit losses.
Under this approach the tracking of changes in credit risk is not required but instead the base
lifetime expected credit loss at all times is applied. An allowance for loss is made for
potentially impaired receivables during the year in which they are identified based on a
periodic review of all outstanding amounts. Profit and loss impacts are immaterial. Trade
receivables are deemed as impaired when there is an indication of significant financial
difficulties of the debtor (delinquency in or default on payments occurs, probability of
bankruptcy or need for financial reorganisation).
Financial liabilities are classified as interest-bearing liabilities and measured at fair value
through profit or loss.
- 10 -
SOFISA SA
Other financial liabilities, including borrowings and long term debts, are initially measured at
fair value, net of transaction costs. Other financial liabilities are subsequently measured at
amortised cost using the effective interest rate method, with interest expense recognised on
an effective yield basis. The effective interest rate method is a method of calculating the
amortised cost of a financial liability and allocating interest expense over the relevant period.
The effective interest rate is the rate that exactly discounts estimated future cash payments
through the expected life of the financial liability, or, where appropriate, a shorter period.
CASH AND CASH EQUIVALENTS: In addition to cash on hand and cash at bank, cash and cash
equivalents may also include fixed-term deposits with an original maturity of up to three
months.
RESTRICTED CASH: Cash is considered to be restricted when it is subject to contingent rights of
a third party.
SECURITIES: On the statement of financial position, securities under current assets comprise
marketable, easily realisable securities and time deposits with an original maturity of 3 to 12
months.
IFRS 9, Financial instruments, requires that the classification of an investment portfolio as either
“fair value through profit or loss (FVTPL)” or as “fair value through other comprehensive
income (FVTOCI)” depends on the entity’s intention and past practice.
IFRS 9 provides guidance on how to determine whether a business model is to manage assets
to collect contractual cash flows or to both collect contractual cash flows and to sell financial
assets. Other business models are all the ones that do not meet one of those two qualifying
criteria. If the portfolio manager actively buys and sells financial instruments to generate short-
term profits, the financial instruments in the portfolio are considered, by default, as held as
FVTPL.
The Group holds a marketable securities portfolio which is measured at FVTPL. Changes in the
fair value of these financial instruments are recorded in the statement of profit or loss in the
captions “investment income” or “Investment loss” as appropriate.
The valuation of these marketable securities and related investment income / (loss) is based
on fair value derived from quoted price in active markets. Changes in fair value can have a
material impact on the financial statements of the Group.
Securities represent investments in equity markets all traded on a securities exchange. For
those financial instruments traded in the active markets, the determination of the fair values
is based on quoted market prices or dealer price quotations. The value measurement does
not result from a valuation made by the management of the company.
INVENTORIES: Inventories consist of land and residential property under development and
held for sale. Borrowing costs directly attributable to the acquisition, construction or of
qualifying assets, which are assets that necessarily take a substantial period of time to get
ready for their intended use or sale are recognised as part of the cost of the qualifying assets.
Inventory is recorded at the lower of cost and estimated net realisable value. Cost includes
the cost of land, carrying costs (principally property taxes) and development costs (including
construction). Net realisable value is the estimated selling price in the ordinary course of
business, less the estimated costs of completion and selling expenses.
PROPERTY, PLANT AND EQUIPMENT: Property, plant and equipment are carried at cost less
accumulated depreciation and impairment. Depreciation is provided on a straight-line basis
over the estimated useful lives of the assets as follows:
Furniture and fixtures 10 years
Computer equipment 3 years
Computer software 3 years
- 11 -
SOFISA SA
Leasehold improvements over term of lease
Portable buildings 3 years
The depreciation method, residual values and useful lives of all property, plant and
equipment are reviewed and adjusted, if appropriate, at least at each financial year end,
with the effect of any changes in estimate accounted for prospectively.
IMPAIRMENT OF TANGIBLE ASSETS: At each end of the reporting period, the Group reviews the
carrying amounts of its tangible assets to determine whether there is any indication that those
assets have suffered an impairment loss. If any such indication exists, the recoverable amount
of the asset is estimated in order to determine the extent of the impairment loss (if any). When
it is not possible to estimate the recoverable amount of an individual asset, the Group
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
When a reasonable and consistent basis of allocation can be identified, corporate assets are
also allocated to individual cash-generating units, or otherwise they are allocated to the
smallest group of cash-generating units for which a reasonable and consistent allocation
basis can be identified.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing
value in use, the estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time value of money and
the risks specific to the asset for which the estimates of future cash flows have not been
adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than
its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to
its recoverable amount. An impairment loss is recognised immediately in profit or loss.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-
generating unit) is increased to the revised estimate of its recoverable amount, but so that
the increased carrying amount does not exceed the carrying amount that would have been
determined had no impairment loss been recognised for the asset (or cash-generating unit)
in prior years. A reversal of an impairment loss is recognised immediately in profit or loss.
DIVIDENDS: Dividends received are recognised to profit in the fiscal year in which they were
approved by the Shareholder Meeting.
TAXATION: Tax expense represents the sum of the current tax and deferred tax.
Current tax: The tax currently payable is based on taxable profit for the year. Taxable profit
differs from profit as reported in the consolidated statement of profit or loss and other
comprehensive income because it excludes items of income or expense that are taxable or
deductible in other years and it further excludes items that are never taxable or deductible.
The Group’s liability for current tax is calculated using tax rates that have been enacted or
substantively enacted by the end of the reporting period.
Deferred tax: Deferred tax is recognised on temporary differences between the carrying
amounts of assets and liabilities in the consolidated financial statements, and the
corresponding tax base used in the computation of taxable profit, and is accounted for using
the full liability method. Deferred tax liabilities are generally recognised for all taxable
temporary differences, and deferred tax assets are generally recognised for all deductible
temporary differences to the extent that it is probable that taxable profits will be available
against which those deductible temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period
and reduced to the extent that it is no longer probable that sufficient taxable profits will be
available to allow all or part of the asset to be recovered.
- 12 -
SOFISA SA
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply
in the period in which the liability is settled or the asset realised, based on tax rates (and tax
laws) that have been enacted or substantively enacted by the end of the reporting period.
The measurement of deferred tax liabilities and assets reflects the tax consequences that
would follow from the manner in which the Group expects, at the end of the reporting period,
to recover or settle the carrying amount of its assets and liabilities.
Current and deferred tax for the year: Current and deferred tax are recognised as an
expense or income in profit or loss, except when they relate to items credited or debited
directly to equity, in which case the tax is also recognised directly in equity.
BORROWING COSTS: Borrowing costs directly attributable to the acquisition, construction or
of qualifying assets, which are assets that necessarily take a substantial period of time to get
ready for their intended use or sale, are added to the cost of those assets, until such time as
the assets are substantially ready for their intended use or sale.
All other borrowing costs are recognised in profit or loss in the period in which they are
incurred.
RETIREMENT BENEFIT COSTS: Wages, salaries, social security contributions, annual leave and
paid sick leave, bonuses and non-monetary benefits are expensed in the year in which the
associated services are rendered by the Group’s employees.
Pension obligations: A defined benefit plan is a pension plan that defines an amount of
pension benefit that an employee will receive on retirement, principally dependent on an
employee’s years of service and remuneration at retirement. Plans are usually funded by
payments from the Group and employees. The liability recognised in the statement of
financial position is the aggregate of the present value of the defined benefits obligation less
the fair value of plan assets. Where a plan is unfunded, only a liability representing the present
value of the defined benefits obligation is recognised in the statement of financial position.
The present value of the defined benefits obligation is calculated by independent actuaries
using the projected unit credit method. This method reflects the discounted expected future
payment required to settle the obligation resulting from employee service in the current and
prior periods. The future cash outflows incorporate actuarial assumptions primarily regarding
the projected rates of remuneration growth, and long-term indexation rates. Discount rates,
used to determine the present value of the defined benefit obligation, are based on the
market yields of high-quality corporate bonds in the country concerned. Actuarial gains and
losses arising from experience adjustments and changes in actuarial assumptions are
charged or credited to equity in other comprehensive income in the period in which they
arise. Past-service costs are recognised immediately in the income statement. Net interest
expense is calculated by applying the discount rate at the beginning of the period to the net
defined benefit liability or asset. Pension assets and liabilities in different defined benefit
schemes are not offset unless the Group has a legally enforceable right to use the surplus in
one plan to settle obligations in the other plan.
SALES REVENUE
Revenue recognition
The Group accounts for a contract when the Group and the homebuyer have approved the
contract in accordance with customary business practices and are committed to their
obligations, the rights of the parties and payment terms are identified, and collection of the
consideration is probable.
Typically, the Group contracts with a homebuyer to provide a completed single-family
detached home on a specific land parcel or a completed residential unit in a multi-family
building for a fixed-price, the transaction price, as specified in the contract. This may involve
- 13 -
SOFISA SA
the Group integrating a number of tasks and components into a single project.
Consequently, the entire contract is accounted for as a single performance obligation.
For sales of single-family detached homes, individual residential units in multi-family buildings,
or in rare instances parcel(s) of land, the Group satisfies its performance obligation when the
homebuyer takes physical possession at the time the sale is closed. That is also the point in
time the Group has the right to payment beyond the initial purchase deposits received from
the homebuyer. Therefore, the Group recognises all revenue at the closing date. Funds
received in advance of the closing date in the form of purchase deposits are recorded as a
liability on the consolidated balance sheet and captioned as deferred revenue until the
closing date.
For the construction of custom built single-family detached homes on land not owned by the
Group and the completion of miscellaneous onsite and offsite development associated with
a large parcel of land sold in the current year, the Group satisfied the performance obligation
over time and receives payment during the course of the contract on specified dates or as
certain milestones are met. Therefore, the Group recognises revenue over time as the
performance obligation is satisfied. The revenue for the construction and remaining
development is recognised based on the extent of progress toward completion of the
performance obligation. The Group uses the cost-to-cost measure of progress as it best
reflects the costs that were incurred on the contract. Under the cost-to-cost measure, the
extent of progress is determined by the ratio of costs incurred to date to the total estimated
costs at completion of the single performance obligation. Costs of residential property sold
include land, materials, labour, subcontractors, other direct costs, and an allocation of
certain indirect costs. Revenues, including estimated profits, are recorded proportionately as
costs are incurred.
In connection with the sale of a large parcel of land in the previous year, the Group was
required to provide ongoing advisory services to the purchaser to assist the purchaser with
obtaining certain development permits on the purchased land. The services were provided
over an 18-month term ending June 30, 2023, at which time the Group was paid a lump-sum
amount. As the contracted revenue to be earned for providing these services was not
contingent on the purchaser successfully obtaining the development permits, the Group
satisfied the performance obligation over time as the services were provided and recorded
the revenue on a straight-line basis over the 18-month term.
The Group’s contracts specify the price for the performance obligation. In the case of
contracts for custom built single-family detached homes, the homebuyer may request
changes to the specifications and requirements of the home. Because of the integrated
nature of the goods and services associated with providing a completed home to a
homebuyer, such modifications are for items that are not distinct from the existing contract
and are accounted for as if they were part of the existing contract. The effect of such
contract modifications on the transaction price and the measure of progress of the
performance obligation is recognised as a cumulative adjustment to revenue as an increase
or decrease in revenue.
Deferred revenue also includes the excess of amounts billed to homebuyers over the revenue
earned on uncompleted contracts. Such amounts are classified as a liability.
Deferred revenue is reported on a contract-by-contract basis.
Amounts billed for work performed but not yet paid for by the homebuyer are included in the
trade and other receivables as an asset.
When it is probable that total contract costs will exceed total contract revenue, the expected
loss is recognised as an expense immediately .
- 14 -
SOFISA SA
DIVIDEND AND INTEREST INCOME: Dividend income from securities is recognised when the
holder’s rights to receive payment has been established. Dividends are recognised as
“investment income” in the consolidated statement of profit or loss and other comprehensive
income in the financial statements.
Interest is recognised using the effective interest rate method. Interest revenue is recognised
in the consolidated statement of profit or loss and other comprehensive income as “Other
financial income”.
5) OPERATING SEGMENTS
The operating segments are identified on the basis of internal reporting about components
of the Group that are regularly reviewed by the operating decision maker in order to allocate
resources to the segments and to assess their performance.
Residential property development: rezoning and obtaining development permits, designing
and constructing homes, both single and multi-family on existing land located in Canada and
USA, for our own account, and sometimes acting as general contractor for third party clients.
Other: Providing corporate services to the other segments in Canada (residential property
development), including corporate financing, management and administration, payroll,
office premises.
Investment activity/Corporate: direct administration of the operating subsidiaries as well as
management of a global equity portfolio in adherence to the MSCI All Country World (net
dividend invested) in Swiss francs. This activity is conducted by the parent company and its
subsidiary Sofisa Finance SA, both companies based in Switzerland.
Residential
2024
Property
Investment
Consolidated
development
Other
activity
CHF
Investment income
-
-
98,133,969
98,133,969
Revenues from external
customers
70,893,180
-
-
70,893,180
Earnings /(Loss) before
interest and tax
3,186,004
(4,021,750)
96,242,872
95,407,127
Net financing costs
-
-
-
449,989
Income tax
-
-
-
(16,637,298)
Net profit (loss)
-
-
-
79,219,818
Reportable segment assets
134,903,885
1,486,135
394,362,194
530,752,214
Reportable segment
liabilities
106,649,371
1,286,443
41,239,784
149,175,598
- 15 -
SOFISA SA
Residential
2023
Property
Investment
Consolidated
development
Other
activity
CHF
Investment income
-
-
41,501,689
41,501,689
Revenues from external
customers
65,360,381
-
-
65,360,381
Earnings /(Loss) before
interest and tax
8,825,405
(2,232,183)
40,438,456
47,031,679
Net financing costs
-
-
-
(4,524,636)
Income tax
-
-
-
(6,399,714)
Net profit (loss)
-
-
-
36,107,329
Reportable segment assets
142,281,161
1,363,144
414,351,941
557,996,246
Reportable segment
liabilities
73,666,622
245,805
24,327,918
98,240,345
The Group operates in three geographical areas – British Columbia, in Canada, USA and
Switzerland (country of domicile).
2024
Consolidated
Canada
USA
Switzerland
CHF
Investment income
-
-
98,133,969
98,133,969
Revenues from
external customers
69,390,915
1,502,265
-
70,893,180
Earnings / (Loss)
before interest and
tax
(2,129,169)
1,293,424
96,242,872
95,407,127
Reportable
segment assets
125,238,685
11,151,335
394,362,194
530,752,214
Reportable
segment liabilities
107,787,086
148,728
41,239,784
148,175,598
2023
Consolidated
Canada
USA
Switzerland
CHF
Investment income
-
-
41,501,689
41,501,689
Revenues from
external customers
64,957,338
403,043
-
65,360,381
Earnings / (Loss)
before interest and
tax
6,254,247
338,976
40,438,456
47,031,679
Reportable
segment assets
131,892,298
11,752,007
414,351,941
557,996,246
Reportable
segment liabilities
73,908,836
3,591
24,327,918
98,240,345
- 16 -
SOFISA SA
6) SUBSIDIARIES
Details of the Group’s significant subsidiaries at year-end are as follows:
Name of the subsidiary
Ownership
Voting
Place of incorporation
interest
held
rights
Principal activity
%
%
Sofisa Canada Ltd
100
100
Residential real estate
Vancouver, Canada
development
British Pacific Properties Ltd
100
100
Residential real estate
Vancouver, Canada
development
British Pacific Enterprises Ltd
100
100
Residential real estate
Vancouver, Canada
development
British Pacific Holdings Ltd
100
100
Investment holding
Vancouver, Canada
Rodgers Creek G.P. Ltd
100
100
Residential real estate
Vancouver, Canada
development
The British Pacific Properties Ltd Partnership
100
100
Residential real estate
Vancouver, Canada
development
The Peak British Properties GP Ltd
100
100
Residential real estate
Vancouver, Canada
development
The Courtenay British Properties GP Ltd
100
100
Residential real estate
Vancouver, Canada
development
The Uplands One G.P. Ltd
100
100
Residential real estate
Vancouver, Canada
development
The Uplands Two G.P. Ltd
100
100
Residential real estate
Vancouver, Canada
development
The Uplands Three G.P. Ltd
100
100
Residential real estate
Vancouver, Canada
development
The Uplands Four G.P. Ltd
100
100
Residential real estate
Vancouver, Canada
development
The Uplands Ten G.P. Ltd
100
100
Residential real estate
Vancouver Canada
development
The Uplands Fourteen G.P Ltd
100
100
Residential real estate
Vancouver, Canada
development
Cypress Village G.P Ltd
100
100
Residential real estate
Vancouver, Canada
development
Rodgers Creek Ltd Partnership
100
100
Residential real estate
Vancouver, Canada
development
The Peak British Properties Ltd Partnership
100
100
Residential real estate
Vancouver, Canada
development
The Courtenay British Properties Ltd Partnership 100
100
Residential real estate
Vancouver, Canada
development
The Uplands One Limited Partnership
100
100
Residential real estate
Vancouver, Canada
development
The Uplands Two Limited Partnership
100
100
Residential real estate
Vancouver, Canada
development
The Uplands Three Limited Partnership
100
100
Residential real estate
Vancouver, Canada
development
- 17 -
SOFISA SA
The Uplands Four Limited Partnership
100
100
Residential real estate
Vancouver, Canada
development
The Uplands Ten Limited Partnership
100
100
Residential real estate
Vancouver, Canada
development
The Uplands Fourteen Limited Partnership
100
100
Residential real estate
Vancouver, Canada
development
Cypress Village Limited Partnership
100
100
Residential real estate
Vancouver, Canada
development
British Pacific Homes Limited
100
100
Residential real estate
Vancouver, Canada
development
SOFISA USA Inc.
100
100
Residential and
Delaware, USA
commercial real estate
development
Sofisa Malaysia (L) Ltd
100
100
Investment company to
Labuan, Malaysia
provide finance to group
companies
Sofisa Properties SDN BHD
100
100
Investment holding
Labuan, Malaysia
Sofisa Finance SA
100
100
Finance for the Group and
Fribourg, Switzerland
portfolio investment
7)
CASH AND CASH EQUIVALENTS
2024
2023
CHF
CHF
Cash at banks and in hand
51,869,623
10,043,214
Short-term deposits
12,579
21,048
Total
51,882,202
10,064,262
Cash at banks earns interest at floating rates based on daily bank deposit rates. Short-term
deposits are made for varying periods of between one day and three months, depending on
the immediate cash requirements of the Group, and earn interest at the respective short-term
deposit rates.
The increase in cash is due to the cash generated by operating activities, partially offset by
the own shares buy-back and by the dividend payment.
8) RESTRICTED CASH
As at December 31, 2024, the Group’s CHF 2,387,240 restricted cash balance (2023 – CHF
958,283) was related to holdbacks paid by customers for homes under construction. Restricted
cash for all periods is presented separately on the statement of financial position.
- 18 -
SOFISA SA
9)
SECURITIES
2024
2023
CHF
CHF
Financial assets carried at fair value
through profit and loss
Equity instruments (FVTPL)
344,249,307
405,577,181
Total
344,249,307
405,577,181
Securities represent investments in equity instruments all traded on a securities exchange.
They constitute a global equity portfolio in adherence to the MSCI All Country World ( net
dividend invested) in Swiss francs.
Securities are pledged as collateral bank credit facility (see note 18).
10)
TRADE AND OTHER RECEIVABLES
2024
2023
CHF
CHF
Trade receivables
764,134
104,499
Amounts due from customers under completed
contracts and servicing agreements
746,540
379,845
Harmonized Sales Tax (HST)
2,126,308
567,887
Other receivables
15,484
16,068
Total
3,652,466
1,068,299
No provision for doubtful trade accounts receivable was deemed necessary.
11)
CURRENT TAX ASSETS
a)
CURRENT TAX ASSETS AND LIABILITIES
Current tax assets
2024
2023
CHF
CHF
Withholding tax receivable
704,643
396,780
Tax refund receivable
3,175,118
1,405,166
Total
3,879,761
1,801,946
Current tax liabilities
2024
2023
CHF
CHF
Current tax payable and other taxes
14,903,033
125,382
Previous year tax payable
0
72,607
Stamp duty payable
1,485,148
0
Total
16,388,181
197,989
- 19 -
SOFISA SA
2024
Opening Charged to Charged Exchange Closing
b)
DEFERRED TAX ASSETS/(LIABILITIES)
balance
income
to OCI
differences
balance
CHF
CHF
CHF
CHF
CHF
Temporary differences
Securities
(18,263,989)
(2,879,481)
-
-
(21,143,470)
Furniture and equipment
319,415
(62,689)
-
(2,874)
253,852
Accruals and deferred income
2,324,891
(288,136)
-
(24,217)
2,012,538
Unrealised
exchange gain
(3,570,160)
3,448,903
-
-
(121,257)
Retirement benefit
obligations
(33,900)
9,024
(9,883)
259
(34,451)
Losses carry forward
1,059,439
102,061
(15,612)
1,145,888
Warranties provision
17,234
-
-
(221)
17,013
Temporary differences
(18,147,070)
329,682
(9,833)
(42,666)
(17,869,887)
Tax losses
448,347
(448,347)
-
-
0
Income tax benefit / (expense)
recognised in profit or loss
(17,698,723)
(118,665)
(9,833)
(42,666)
(17,869,887)
2023
Opening
Charged to
Charged
Exchange
Closing
DEFERRED TAX ASSETS / (LIABILITIES)
balance
income
to OCI
differences
balance
CHF
CHF
CHF
CHF
CHF
Temporary differences
Securities
(13,130,472)
(5,133,517)
-
-
(18,263,989)
Furniture and equipment
367,498
(25,123)
-
(22,960)
319,415
Accruals and deferred income
2,765,661
(271,392)
-
(169,377)
2,324,891
Unrealised
exchange gain
(2,441,818)
(1,128,342)
-
-
(3,570,160)
Retirement benefit
obligations
(54,246)
5,106
11,909
3,331
(33,900)
Losses carry forward
710,908
412,037
(63,506)
1,059,439
Warranties provision
18,438
-
-
(1,204)
17,234
Temporary differences
(11,764,032)
(6,141,230)
11,909
(253,716)
(18,147,070)
Tax losses
167,282
281,065
-
-
448,347
Income tax benefit / (expense)
recognised in profit or loss
(11,596,750)
(5,860,165)
11,909
(253,716)
(17,698,723)
- 20 -
SOFISA SA
Deferred tax balances are presented in the statement of financial position as follows:
2024
2023
CHF
CHF
Deferred tax assets
3,394,840
4,135,426
Deferred tax liabilities
(21,264
,727)
(21,834,149)
Net balance
(17,869
,887)
(17,698,723)
c)
Tax recognised in profit or loss
2024
2023
CHF
CHF
Tax expense comprises:
Current tax (expense)
(16,518,633)
(539,549)
Deferred tax income/(expense) relating to the
origination and reversal of temporary
differences
329,682
(6,141,230)
Recognition of deferred tax assets on losses
carried forward
(448,347)
281,065
Total tax expense
(16,637,298)
(6,399,714)
The total charge for the year can be reconciled to the accounting profit / (loss) as follows:
2024
2023
CHF
CHF
(Loss) profit from continuing operations
95,857,116
42,507,043
Income tax expense calculated at 13.87%
(2023: 13.87%)
(13,292,847)
(5,894,603)
Effect of non-deductible and not taxable items
(1,454,130)
528,771
Effect of expenses that are not deductible in
determining taxable profit
(325,601)
(242,816)
Other items
(27,152)
(17,829)
Effect of different tax rates of subsidiaries
operating in other jurisdictions
(1,537,568)
(773,237)
Total tax expense
(16,637,298)
(6,399,714)
- 21 -
SOFISA SA
12) RETIREMENT BENEFIT OBLIGATION
The Group has a contributory defined benefit pension plan for certain employees, which
provides pension benefits that are based on length of service and final plan earnings (as
defined). The Company also has non-contributory pension plan that provide supplementary
pension benefits to three (three in 2023) beneficiaries.
The Group measures its accrued benefit obligations and the fair value of plan assets for
funding purposes as at December 31 each year. The most recent actuarial valuation for
funding purposes of the pension plans was as at December 31, 2021. The next valuation will
be as at December 31, 2024 and will be available in 2025. In 2024, the employee plan surplus
is adjusted by a valuation allowance equal to the amount by which the surplus exceeds the
expected future economic benefit from the plan.
The Group’s two defined benefit pension plans, as described above, are valued as at
December 31 each year for the purpose of the Group’s accounting in accordance with
standard IAS19.
Salaried plan
The principal assumptions used for the purposes of the actuarial valuations were as follows:
Valuation at December 31,
2024
2023
%
%
Discount rate(s)
4.70
4.65
Expected rate(s) of salary
increase
2.75
2.75
Inflation
2.00
2.00
Mortality
CPM2014
Priv
CPM2014
Priv
Table – Fully generational
Table – Fully
generational
Improvement Scale CPM-B
Improvement Scale CPM-B
Amounts recognised in profit or loss in respect of these defined benefit plans are as follows:
2024
2023
CHF
CHF
Current service cost
81,850
71,745
Net interest cost
(23,188)
(30,064)
Administrative expenses
6,301
6,383
Defined benefit cost recognised in profit or loss
64,963
48,064
Remeasurements – recognised in OCI
(59,166)
11,809
Total defined benefit cost recognised in profit or loss
and OCI
5,797
59,873
The cost for the year is included in the other operating costs in the statement of profit or loss
and other comprehensive income.
- 22 -
SOFISA SA
Present value of defined benefit obligation is as follows:
2024
2023
CHF
CHF
Present value of funded defined benefit obligation
(3,954,004)
(3,886,736)
Fair value of plan assets
4,442,583
4,387,546
Present value of defined benefit asset
488,579
500,810
Movements in the present value in the defined benefit obligation in the current period were
as follows:
2024
2023
CHF
CHF
Opening defined benefit obligation
3,886,736
3,739,834
Current service cost
81,850
71,745
Interest cost
174,601
172,724
Employees' contributions
16,257
16,085
Benefits paid
(160,928)
(159,192)
Remeasurements (Actuarial loss (gain)):
a. changes in demographic assumptions
-
-
b. changes in financial assumptions
(21,171)
204,320
c. experience adjustments
26,590
85,468
Exchange difference
(49,931)
(244,248)
Closing defined benefit obligation
3,954,004
3,886,736
Movements in the present value of the plan assets in the current period were as follows:
2024
2023
CHF
CHF
Opening fair value of plan assets
4,387,546
4,339,693
Interest income
197,788
202,788
Return on plan assets (excluding amount
included in net interest income)
583,284
277,980
Employer contributions
0
0
Employees' contributions
16,257
16,085
Other operating costs paid from plan assets
(6,301)
(6,383)
Benefits paid
(160,928)
(159,192)
Change in asset ceiling/onerous liability
(518,698)
0
Exchange difference
(56,365)
(283,425)
Closing fair value of plan assets
4,442,583
4,387,546
- 23 -
SOFISA SA
The major categories of plan assets are as follows:
2024
2023
%
%
Equity instruments
59
59
Debt instruments
39
39
Cash and short-term
2
2
Total
100
100
The actual return on plan assets was CHF 781,072 (2023: CHF - 480,768).
Supplemental plan
The principal assumptions used for the purposes of the actuarial valuations were as follows:
Valuation at December 31,
2024
2023
%
%
Discount rate(s)
4.70
4.65
Expected rate(s) of salary increase
N/A
N/A
Amounts recognised in profit or loss in respect of these defined benefit plans are as follows:
Remeasurements - recognised in OCI
2024
2023
CHF
CHF
Interest cost
16,130
17,617
Defined benefit cost recognised in profit or loss
16,131
17,617
Remeasurements - recognised in OCI
22,747
32,298
Total defined benefit cost recognised in profit or loss
and OCI
38,877
49,915
The cost for the year is included in other operating costs in the statement of profit or loss.
Present value of unfunded defined benefit obligation is as follows:
2024
2023
CHF
CHF
Present value of unfunded defined benefit
obligation
360,984
375,257
- 24 -
SOFISA SA
The amount included in the statement of financial position arising from the Group’s obligation
in respect of its defined benefit plans is as follows:
2024
2023
CHF
CHF
Unfunded defined benefit obligation
360,984
375,257
Movements in the present value of the defined benefit obligation in the current period were
as follows:
2024
2023
CHF
CHF
Opening defined benefit obligation
375,257
398,950
Interest cost
16,130
17,617
Benefits paid
(48,329)
(47,553)
Remeasurements (Actuarial loss (gain)):
a. changes in demographic assumptions
-
-
b. changes in financial assumptions
(1,197)
10,021
c. experience adjustments
23,944
22,277
Exchange difference
(4,821)
(26,055)
Closing defined benefit obligation
360,984
375,257
The assets and liabilities recognised in the balance sheet and gains or losses recognised in
other comprehensive income at December 31 are as follows:
2024
Salaried plan
Supplemental
TOTAL
plan
CHF
Present value of defined benefit asset /
(obligation)
488,579
(360,984)
127,595
Other comprehensive income (loss / (gain))
(59,166)
22,747
(36,420)
- changes in demographic assumptions
-
-
-
- changes in financial assumptions
(21,171)
(1,197)
(22,369)
- experience adjustments
26,590
23,944
50,534
- change in asset ceiling/onerous liability
518,698
-
518,698
- return on plan assets (excluding amount
included in net interest income)
(583,284)
-
(583,284)
2023
Salaried plan
Supplemental
TOTAL
plan
CHF
Present value of defined benefit asset /
(obligation)
500,810
(375,257)
125,553
Other comprehensive income (loss / (gain))
11,809
32,298
44,107
- changes in demographic assumptions
-
-
-
- changes in financial assumptions
204,320
10,021
214,341
- experience adjustments
85,468
22,277
107,745
- return on plan assets (excluding amount
included in net interest income)
(277,980)
-
(277,980)
- 25 -
SOFISA SA
The plans in Canada expose the Group to actuarial risks such as: investment risk, interest rate
risk, longevity risk and salary risk.
Investment risk
The present value of the defined benefit plan liability is calculated using a
discount rate. If the return on plan asset is below this rate, it will create a
plan deficit.
Interest risk
A decrease in the interest rate will increase the plan liability. However, this
will be partially offset by an increase in the return on the plan’s investments.
Longevity risk
The present value of the defined benefit plan liability is calculated by
reference to the best estimate of the mortality of plan participants both
during and after their employment. An increase in the life expectancy of
the plan participants will increase the plan’s liability.
Salary risk
The present value of the defined benefit plan liability is calculated by
reference to the future salaries of plan participants. As such, an increase in
the salary of plan participants will increase the plan’s liability.
Significant actuarial assumptions for the determination of the defined obligation are discount
rate, inflation/pension increase rate, expected salary increase and mortality. The sensitivity
analyses below have been determined based on reasonably possible changes of the respective
assumptions occurring at the end of the reporting period, while holding all other assumptions
constant.
Assumption
Salaried plan
Supplemental plan
Discount rate
If the discount rate is 0.5 points
If the discount rate is 0.5 points higher
higher (lower), the defined benefit (lower), the defined benefit
obligation would decrease by CHF obligation would decrease by CHF
252,103 (increase by CHF 279,638).
11,657 (increase by CHF 12,413).
Inflation /
If the expected inflation/pension
If the expected inflation/pension
pension increase rate is 0.5 points higher increase rate is 0.5 points higher
increase rate (lower), the defined benefit (lower), the defined benefit
obligation would increase by CHF obligation would increase by CHF
242,840 (decrease by CHF 222,929).
11,846 (decrease by CHF 11,279).
Salary increase
If the expected salary growth rate is
N/A
rate 0.5 points higher (lower), the defined
benefit obligation would increase by
CHF 4,915 (decrease by CHF 48,455).
Mortality
If the life expectancy increases
If the life expectancy increases
(decreases) by one year for both (decreases) by one year for both
men and women, the defined men and women, the defined
benefit obligation would increase by benefit obligation would increase by
CHF 119,152
(decrease by CHF
CHF 28,859
(decrease by CHF
177,688).
27,598).
- 26 -
SOFISA SA
13)
INVENTORIES
Residential property under development and land
held for future development
2024
2023
CHF
CHF
Balance beginning of year
121,539
,269
143,890,363
Add (deduct):
Development costs
53,310,845
35,067,482
Carrying costs
587,388
1,893,118
Cost of sales
(63,995,420)
(50,474,371)
Net foreign currency exchange differences
(1,363,416)
(8,837,323)
Total
110,078,667
121,539,269
In accordance with IFRS the “land held for future development” is carried at the lower of cost
and estimated realisable value. The group engaged a third-party valuation expert who
assessed the fair value of the “land held for future development” at CAD 827 million (CHF 521
million) as at December 31, 2024.
14)
OTHER ASSETS
2024
2023
CHF
CHF
Current assets
Prepaid expenses
122,715
62,424
Prepaid real estate commissions
1,231,573
1,186,465
Total
1,354,288
1,248,889
Non-current assets
Right-of-use assets
599,323
663,308
Total
599,323
663,308
- 27 -
SOFISA SA
15)
PROPERTY, PLANT AND EQUIPMENT
Computer, Fixtures, fittings,
Leasehold IT office 2024
improvements
equipment
equipment
Buildings
Total
Cost
CHF
At January 1, 2024
127,956
546,470
267,955
2,386,382
3,328,763
Additions (Disposals)
-
9,680
52,863
(1,331,487)
(1,268,944)
Net foreign currency
exchange differences
(1,644)
(7,020)
(3,442)
(30,657)
(42,763)
At December 31, 2024
126,312
549,130
317,376
1,024,238
2,017,055
Accumulated depreciation
At January 1, 2024
127,956
510,999
182,375
1,859,976
2,681,306
Depreciation charge for
the year
0
26,773
16,070
74,463
117,306
Disposals
0
0
0
(1,486,653)
(1,486,653)
Net foreign currency
exchange differences
(1,644)
(7,088)
(2,658)
3,791
(7,599)
At December 31, 2024
126,312
530,684
195,787
451,578
1,304,361
Carrying amount
At January 1, 2024
0
35,470
85,580
526,406
647,456
At December 31, 2024
0
18,446
121,589
572,660
712,694
Computer, Fixtures,
Leasehold IT fittings, office 2023
improvements
equipment
equipment
Buildings
Total
Cost
CHF
At January 1, 2023
136,897
524,084
199,422
2,520,929
3,381,333
Additions (Disposals)
0
56,613
81,558
30,093
168,264
Net foreign currency
exchange differences
(8,941)
(34,228)
(13,025)
(164,641)
(220,834)
At December 31, 2023
127,956
546,470
267,955
2,386,382
3,328,763
Accumulated depreciation
At January 1, 2023
136,811
508,673
183,371
1,948,658
2,777,513
Depreciation charge for
the year
84
37,085
11,455
40,252
88,876
Net foreign currency
exchange differences
(8,939)
(34,758)
(12,451)
(128,935)
(185,083)
At December 31, 2023
127,956
511,000
182,375
1,859,975
2,681,306
Carrying amount
At January 1, 2023
86
15,412
16,051
572,272
603,820
At December 31, 2023
0
35,470
85,580
526,406
647,456
- 28 -
SOFISA SA
16) INVESTMENT IN NON-CONSOLIDATED COMPANIES
In the current year, the Group increased by USD 327,658 (CHF 296,956) its investment in a real
estate development in the State of Georgia but no new development site has been
acquired. A complementary distribution of USD 5,651 was received from a recently sold
development site. Two development sites acquired over the years 2020-2021 were sold, with
a net gain on sale of USD 1.5 million representing an average net return per annum of 14%.
In 2023, the Group increased by USD 385,936 (CHF 324,804) its investment in a real estate
development in the State of Georgia and has acquired a new development site in
Connecticut representing an investment of USD 2,000,000 (CHF 1,683,200). Complementary
distributions totalling USD 448,423 were received from existing or recently sold development
sites.
17)
OTHER LIABILITIES
2024
2023
CHF
CHF
Current liabilities
Accrued expenses
9,825,634
5,666,605
Deferred revenue
18,433,657
17,971,136
Lease liability
92,968
81,554
Total
28,352,259
23,719,295
Movements in the deferred revenue balance between the periods were as follows :
2024
2023
CHF
CHF
Opening balance
17,971,136
10,560,157
Amounts invoiced during the period
10,033,934
18,748,206
Amounts recognised as revenue
(9,326,679)
(10,297,275)
Exchange difference
(244,734)
(1,039,951)
Closing balance
18,433,657
17,971,137
Non-current liabilities
Other liabilities
63,010
63,830
Lease liability
506,355
581,754
Total
569,365
645,584
- 29 -
SOFISA SA
18)
BORROWINGS
2024
2023
CHF
CHF
Bank overdraft
35,701,358
30,748,800
Short term part of the borrowings
1,260,200
0
Long term part of the borrowings
31,716,796
10,324,500
Total 68,678,354 41,073,300
The Group has a CHF 37,806,000 (CAD 60,000,000) credit line with a Swiss bank. On May 29,
2024, a new fixed-term loan in the amount of CHF 1,260,200 (CAD 2,000,000), repayable on
May 29, 2025, was drawn down. This credit line is secured by the securities.
The Group benefits from another CAD 75,000,000 (2023: CAD 75,000,000) credit facility with a
Canadian chartered bank, secured by an assignment of certain land holdings, from which
letters of credit totalling CAD 16,177,626 (2023: CAD 21,008,420) were issued. The bank
overdraft from this facility amounted to CAD 56,659,829 or CHF 35,701,358 as at December
31, 2024 (2023: CHF 30,748,800).
On March 5, 2024, the Group obtained a new committed non-resolving construction facility
in the principal amount of up to CHF 44,012,485 (CAD 69,850,000). The loan is secured by
Hawksley land and improvements. During the year ended December 31, 2024, CHF 15,409,322
(CAD 24,455,360) was funded by this construction loan facility.
On March 5, 2024, the Group obtained a new committed non-resolving construction facility
in the principal amount of up to CHF 17,850,733 (CAD 28,330,000). The loan is secured by
Wildwood land and improvements. During the year ended December 31, 2024, CHF 9,315,464
(CAD 14,784,104) was funded by this construction loan facility.
On October 7, 2021, the Group secured a non-revolving Mezzanine loan with a third party in
the amount of CHF 5,040,800 (CAD 8,000,000) for the purposes of developing the Hawksley,
a multi-unit residential development. The loan is secured by the Hawksley land in Rodgers
Creek Area 6. Repayment of the loan and accrued interest is due upon the closing of the
sale of each unit, or the third party can demand repayment if the Group fails to complete
the project. CHF 1,213,240 (CAD 1,925,472) was funded by the mezzanine loan during the
year ended December 31, 2022. A further CHF 2,701,850 (CAD 4,287,971) was funded by the
mezzanine loan during the year ended December 31, 2023. In June 2023, CHF 2,440,493 (CAD
3,873,183) was repaid. During the year ended December 31, 2024, CHF 2,960,873 (CAD
4,699,052) was funded by the Mezzanine loan, and CHF 4,350,804 (CAD 6,904,942) was repaid
in total.
On April 7, 2022, the Group secured a non-revolving Mezzanine loan with a third party in the
amount of CHF 2,205,350 (CAD 3,500,000) for the purposes of developing the Wildwood, a
residential town home development. The loan is secured by the Wildwood land in Rodgers
Creek Area 6. Repayment of the loan and accrued interest is due upon the closing of the
sale of each individual town home unit, or the third party can demand repayment if the
Group fails to complete the project. CHF 158,430 (CAD 251,436) was funded by the
mezzanine loan during the year ended December 31, 2022. A further CHF 1,576,035 (CAD
2,501,246) was funded by the mezzanine loan during the year ended December 31, 2023. In
October 2023, CHF 263,348 (CAD 417,946) was repaid. During the year ended December 31,
2024, CHF 557,702 (CAD 885,101) was funded by the Mezzanine loan, and CHF 2,367,626 (CAD
3,757,540) was repaid in total.
- 30 -
SOFISA SA
19) PREFERENTIAL REGISTERED SHARES
In 2001, SOFISA SA issued 3,000 preference shares of a par value of CHF 735 each. By resolution
of the Extraordinary General Meeting of the Shareholders of October 17, 2024, those shares
were divided into 9,000 shares of CHF 245 each. The holder of such preference shares is
entitled to the following:
• Cumulative floating preferential dividend declared annually based on the 10-year Swiss
Government Bond plus 3.75% p.a.
• If one year the preferential dividend cannot be declared, such dividend will be
recoverable by priority out of the profits realised the next years.
• Unpaid dividends will be increased by an amount equal to the above interest plus 1%.
Under IAS 32, as the holder of the preference shares is entitled to an annual preferential
dividend and can redeem the shares at certain dates, the preference shares do not meet
the definition of equity and should be presented as liabilities in the statement of financial
position. Consequently, the dividends related to this class of shares are considered as an
interest expense as a charge of the business period.
During the year ended December 31, 2024, interest of CHF 99,225 (2023: CHF 107,100) has
been recognised on the preference shares.
On June 28, 2024, a dividend of CHF 102,600 (2023: CHF 111,600) have been paid on shares
numbered 15.841 to 24,840 classified as liabilities (shares numbered 3.961 to 6,960 before the
splitting decided by the EGM of Oct. 17, 2024).
20)
SHARE CAPITAL
2024
2023
CHF
CHF
3’960 fully paid ordinary shares
0
3,960,000
15’840 fully paid ordinary shares
3,960,000
0
Number
Share
Fully paid ordinary shares
of shares
capital
Balance at January 1, 2023 and 2024 3,960
3,960,000
Balance at December 31, 2023 3,960
3,960,000
Balance at December 31, 2024 15,840
3,960,000
Fully paid ordinary shares, which have a par value of CHF 1,000, carry one vote per share and
carry a right to dividends.
By resolution of the Extraordinary General Meeting of Shareholders of October 17, 2024, the
3,960 ordinary shares with a par value of CHF 1,000 were divided into 7,920 ordinary shares
with a par value of CHF 250 and 7,920 shares with a par value of CHF 250, with dividend rights
and preferential liquidation rights.
- 31 -
SOFISA SA
21) OWN CAPITAL SHARES
On October 28, 2024, SOFISA SA bought back 2,884 of its own shares with a par value of CHF
250 each, for a total of CHF 149,252,768.
22)
RESERVES
2024
2023
CHF
CHF
General
1,560,000
1,560,000
Special
170,000,000
170,000,000
Balance at the year end
171,560,000
171,560,000
The special reserve was created after being approved by decision of the General Meeting
of Shareholders on May 12, 1993.
There were no movements in the reserves in 2024.
23)
RETAINED EARNINGS
2024
2023
CHF
CHF
Balance at beginning of year
316,111,928
287,865,361
Net profit for the year
79,219,818
36,107,329
Other comprehensive income
20,726
(40,762)
Payment of dividends
(7,820,000)
(7,820,000)
Balance at the end of year
387,532
,472
316,111,928
On 24 June 2024, a dividend of CHF 2,00 0 per share was paid on shares numbered 1 to 2,394
and 2,445 to 3,960, representing an aggregate amount of CHF 7,820,000.
In respect of the current year, the Board of the Directors proposes a dividend of CHF 500 per
share be paid on 11 June 2025 to eligible holders of shares numbered 1 to 7,820 and 7,921 to
12,956 and a total of CHF 95,850 be paid to holders of shares numbered 3,961 to 6,960. This
decision is subject to approval by shareholders at the Annual General Meeting.
In addition, and subject to approval of the Articles of Association by the Annual General
Meeting in June 2025, the Board of Directors proposes a preferred dividend of CHF 11,838.50
per share be paid on 30 June 2025 to the holders of shares numbered 7,821 to 7,920. This
preferred dividend amounts of CHF 1,183,850 and this decision is subject to approval by
shareholders at the Annual General Meeting on 6 June 2025.
- 32 -
SOFISA SA
24)
CUMULATIVE TRANSLATION ADJUSTMENT
2024
2023
CHF
CHF
Balance at beginning of year
(31,876
,027)
(29,147,766)
Arising on translation of foreign operations
(347,061)
(2,728,261)
Balance at the end of year
(32,223
,088)
(31,876,027)
Exchange differences relating to the translation from the functional currencies of the Group’s
foreign subsidiaries into CHF are recognised in the cumulative translation differences.
25)
SALES REVENUE
2024
2023
CHF
CHF
Revenue recognised at a point in time
From a land sale
44,024,950
0
From single-family detached homes build on
speculation and individual residential units in multi-family
26,868,230 64,224,824
buildings
Revenue recognised over time
From servicing work
0
503,226
From custom built single-family detached homes
0
632,331
Total
70,893,180
65,360,381
26)
INVESTMENT INCOME AND OTHER FINANCIAL INCOME
2024
2023
CHF
CHF
Net income (loss) from securities
Dividend and interest income
7,574,528
8,465,561
Realised gain on securities
82,203,315
1,326,235
Realised loss on securities
(10,230,892)
(3,254,562)
Fees on portfolio management
(335,927)
(294,768)
Increase (decrease) in value of securities
18,922,945
35,259,223
Total investment income (loss)
98,133,969
41,501,689
Other financial income
Interest received
512,668
814,410
Net exchange gain
2,865,127
0
Total other financial income
3,377,795
814,410
Total investment income (loss) and
other financial income (loss)
101,511,764
42,316,099
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SOFISA SA
Investment revenue earned on financial assets, analysed by category of asset, is as follows:
Fair value through profit or loss (FVTPL)
98,133,969
41,501,689
Loans and receivables (including cash)
3,377,795
814,410
Total investment income (loss) and
other financial income (loss)
101,511,764
42,316,099
27)
FINANCIAL EXPENSES
2024
2023
CHF
CHF
Bank charges
(250,455)
(220,101)
Interest on borrowings
(2,578,126)
(1,818,544)
Dividends on preferential registered shares
(99,225)
(107,100)
Net exchange loss
0
(3,193,301)
Total
(2,927,806)
(5,339,046)
28) OTHER RELATED PARTY TRANSACTIONS
During the year the Group paid short-term benefits totalling CAD 300,000 or CHF 189,030 (2023:
CHF 191,490) recorded in other operating costs to key subsidiary operating management. Key
subsidiary operating management is defined as directors and officers.
There are no other related party transactions to be disclosed other than those presented in and
in note 32.
29) COMMITMENTS AND CONTINGENT LIABILITIES
On January 1, 2017, the Group entered into a development agreement with a third party land
owner whereby the parties agreed to jointly develop, construct and sell to third party
purchasers, homes to be constructed on the third party land owner’s property. The projects
were completed. The Group is responsible to fund all construction costs, currently estimated to
be nil (2023: nil).
At December 31, 2024, the Group has outstanding letters of credit aggregating to
approximately CHF 10,193,522 (2023: CHF 13,409,674) in connection with real estate
development projects.
In fiscal years 2016 and 2017, the Group received Notices of Reassessment from the Canada
Revenue Agency (“CRA”) totaling CAD 3,556,857 (CHF 2,241,176) in additional income taxes
and interest and transfer pricing penalties totaling CAD 718,929 (CHF 452,997) in respect of the
Group’s December 31, 2012 and 2013 taxation years.
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SOFISA SA
CRA is asserting that the interest rate on certain related party debt now held by SOFISA SA
should be substantially lower, which would result in a reduction of tax-deducted interest
expense and a corresponding increase in taxable income.
Subsequent to filing Notices of Objection for both reassessments, the Group filed a Notice of
Appeal to the Tax Court of Canada appealing to the 2012 and 2013 reassessments on July 4,
2019. On November 29, 2019, the Attorney General of Canada on behalf of the CRA filed a
Reply to the Notice of Appeal. To date, the Tax Court of Canada has not released any decision
on the Notice of Appeal.
While management and the Group’s legal counsel believe the reassessments are without merit
during the 2021 fiscal year the Group offered to settle the matter with CRA on a without
prejudice for approximately CAD 930,000 (CHF 585,993) in order to avoid future litigation costs
and not as admission of guilt. The CRA has not accepted or rejected settlement offer.
Should the CRA be successful in its claim and apply their position to open taxation years
beyond 2012 and 2013, the Group has estimated the potential income tax exposure for the
remaining open taxation years to be approximately CAD 11.3 million excluding any interest
or penalties.
In fiscal 2020, the Group was notified by CRA that the Company’s fiscal 2017 through 2019
taxation years would once again be subject to an audit by CRA. During the year 2022, the
Group was notified by CRA that there were no adjustments stemming from the main income
tax audit, however, the rate of interest paid on an affiliate’s debt for fiscal 2017 through 2019
was still subject to audit by CRA’s transfer pricing division.
As management believes the Group will ultimately be successful in its defense of the 2012
and 2013 reassessments and will not be reassessed for any additional taxes, interest and
penalties for any open taxation years, no amounts have been accrued in the December 31,
2023 or 2024 consolidated financial statements for the impact of the reassessments nor any
similar adjustments that would likely be proposed for open taxation years should CRA
ultimately be successful.
30) FINANCIAL RISK MANAGEMENT
The Sofisa Group has specific guidelines on managing financial assets and liabilities. In order
to optimise financial resources, the management of liquidity not required for operational
purposes is largely centralised as long-term Group financing.
Capital risk management: The Group manages its capital to ensure that it will be able to
continue as a going concern while maximising the return to shareholders through the
optimisation of the debt and equity balance. The Group overall strategy remains unchanged
from previous year.
The capital structure of the Group consists of debt, which includes the preference shares,
cash and cash equivalents and securities and equity attributable to the shareholders,
comprising issued capital, reserves and retained earnings as disclosed in Notes 19 to 22.
Significant accounting policies: Details of the significant accounting policies and methods
adopted, including the criteria for recognition, the basis of measurement and the basis on
which income and expenses are recognised, in respect of each class of financial asset,
financial liability and equity instrument are disclosed above.
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SOFISA SA
Categories of financial instruments:
31.12.2024
Financial
At fair value
Financial
Total
Fair
assets
through profit
liabilities
carrying
value
at
or loss
at
amount
amortised amortised
cost cost
CHF
CHF
CHF
CHF
CHF
Financial assets
Cash and cash equivalents
51,882,202
-
-
51,882,202
51,882,202
Restricted cash
2,387,240
-
-
2,387,240
2,387,240
Securities
-
344,249,307
-
344,249,307
344,249,307
Trade and other receivables
3,652,466
-
-
3,652,466
3,652,466
Investment in non-
consolidated companies
-
8,072,846
-
8,072,846
8,072,846
Total financial assets
57,901,908
352,322,153
-
410,244,061
410,244,061
Financial liabilities
Trade and other payables
-
-
11,308,803
11,308,803
11,308,803
Short-term part of
borrowings
-
-
36,961,558
36,961,558
37,862,515
Long-term part of
borrowings
-
-
31,716,796
31,716,796
33,085,333
Other liabilities
-
-
28,352,259
28,352,259
28,352,259
Preferential shares
-
-
2,252,925
2,252,925
2,252,925
Total financial liabilities
-
-
110,592,341
110,592,341
112,412,259
31.12.2023
Financial
At fair value
Financial
Total
Fair
assets
through profit
liabilities
carrying
value
at
or loss
at
amount
amortised amortised
cost
cost
CHF
CHF
CHF
CHF
CHF
Financial assets
Cash and cash equivalents
10,064,262
-
-
10,064,262
10,064,262
Restricted cash
958,283
-
-
958,283
958,283
Securities
-
405,577,181
-
405,577,181
405,577,181
Trade and other receivables
1,068,299
-
-
1,068,299
1,068,299
Investment in non-
consolidated companies
-
10,166,375
10,166,375
10,166,375
Total financial assets
12,090,844
415,743,556
-
427,834,400
427,834,400
- 36 -
SOFISA SA
Financial liabilities
Trade and other payables
-
-
8,513,728
8,513,728
8,513,728
Short-term part of
borrowings
-
-
30,748,800
30,748,800
32,011,224
Long-term part of
borrowings
-
-
10,324,500
10,324,500
13,791,807
Other liabilities
-
-
23,719,295
23,719,295
23,719,295
Preferential shares
-
-
2,256,300
2,256,300
2,256,300
Total financial liabilities
-
-
75,562,623
75,562,623
80,292,354
Fair value of financial instruments:
All portfolio investments are concentrated in the global equity mandate tracking MSCI World
AC index. These securities investments are the only financial instruments measured at fair
value subsequent to their initial recognition.
Securities investments (2024: CHF 344,249,307 2023: CHF 405,577,181) qualify as Level 1 fair
value measurement category. Level 1 fair value measurements are those derived from the
quoted price in active markets.
The fair value of short- and long-term borrowings is determined for each loan by discounting
future cash flows, using the yield curve zero coupon bond made available by the Bank of
Canada at the balance sheet date.
Investments in non-consolidated companies (2024: CHF 8,072 846 2023: CHF 10,166,375)
qualify as Level 3 fair value measurement category. Level 3 fair value measurements are
those that are not based on observable market data.
The fair values of the cash and cash equivalents, restricted cash, trade and other receivables,
trade and other payables, other liabilities and preferential shares are assumed to
approximate to their carrying value but for completeness are included in the above analysis
The Group’s policy for determining when transfers between levels of the fair value hierarchy
are deemed to have occurred are based on changes in the level of inputs to valuation
techniques used to measure fair value. There was no transfer between levels of fair value
hierarchy in the current year.
Financial risk management objectives: The Group finance management function provides
services to the business, co-ordinates access to domestic and international financial markets,
monitors and manages the financial risks relating to the operations of the Group through
internal risk reports which analyse exposures by degree and magnitude of risks. These risks
include market risk, credit risk, liquidity risk and other market risk.
The Group delegates other investment decisions to external Portfolio Managers. The mandates
are entrusted in accordance with the Swiss Law, within a clearly defined framework and
investments guidelines. In selecting individual investments, Portfolio Managers must adhere to
the principle of risk diversification and comply with the percentage limits, the investment
universe or the composition of the agreed benchmark MSCI All Country World (net dividend
invested) in CHF.
Market risk management: Market risks are potential losses that the Group could incur through
changes in the variable conditions. The variables may be the equity price risk, exchange rates
- 37 -
SOFISA SA
and interest rates. Changes in the fair values of financial assets, financial liabilities caused by
such variable factors may affect the Group’s financial position and results.
Sensitivity analysis with respect to price risk
The Group is exposed to price risks arising from portfolio investments. The sensitivity analyses
below have been determined based on the exposure to price risks at the reporting date.
If prices had been 10% higher/lower, net profit for the year ended December 31, 2024 would
have been affected as the portfolio investment are classified as at fair value through profit and
loss. The profit would increase/decrease by CHF 34.47 million (CHF 40.62 million in 2023).
Exchange rate risk management: The Group is exposed to exchange rate risk, mainly in relation
to the USD, CAD, EUR, GBP, JPY and CNY that affect the Group’s assets and earnings in Swiss
francs. The foreign exchange risks are not hedged.
Considering the weight of the different foreign currencies in which our assets are invested, the
impact of the exchange rate effect on our investment values may be estimated to about
5.04 % in 2024 (-7.80 % in 2023).
Sensitivity analysis with respect to foreign currencies
The sensitivity analysis covers only monetary items in the statements of financial position that,
relative to the functional currency of the Group, are settled in foreign currencies. The sensitivity
analysis excludes net investment in Group companies. The largest monetary items in the
statements of financial position of the Group companies relate to the currency pairs CHF/USD,
CHF/EUR, CHF/JPY, CHF/GBP and CHF /CNY.
If the CHF had been 10% stronger (weaker) against the USD at December 31, 2024, the Group’s
net income would have been CHF 22.63 million lower (higher). In the prior year, the same
percentage difference in the exchange rate would have caused net income to be CHF 25.10
million lower (higher).
If the CHF had been 10% stronger (weaker) against the EUR at December 31, 2024, the Group’s
net income would have been CHF 2.65 million lower (higher). In the prior year, the same
percentage difference in the exchange rate would have caused net income to be CHF 3.59
million lower (higher).
If the CHF had been 10% stronger (weaker) against the JPY at December 31, 2024, the Group’s
net income would have been CHF 1.67 million lower (higher). In the prior year, the same
percentage difference in the exchange rate would have caused net income to be CHF 2.20
million lower (higher).
If the CHF had been 10% stronger (weaker) against the GBP at December 31, 2024, the Group’s
net income would have been CHF 1.08 million lower (higher). In the prior year, the same
percentage difference in the exchange rate would have caused net income to be CHF 1.41
million lower (higher).
If the CHF had been 10% stronger (weaker) against the CNY at December 31, 2024, the Group’s
net income would have been CHF 0.96 million lower (higher). In the prior year, the same
percentage difference in the exchange rate would have caused net income to be CHF 1.13
million lower (higher).
Credit risk management: Credit risks arise when a customer or a third party fails to meet its
contractual obligations and causes the Group a financial loss. In the real estate development,
the Group is exposed to credit risk on its account receivables. The exposure to this risk is
- 38 -
SOFISA SA
generally concentrated to a limited number of debtors, and is also concentrated
geographically in British Columbia, Canada and is subject to the related economic conditions
in that region. Credit risk in this sector arises generally from sales of residential property and is
mitigated by the underlying lien or charge on the property. The Group does not have any
significant credit risk exposure. Maximum exposure to credit risk is limited to the carrying value
of account receivables and securities.
Interest rate risk management: The Group is exposed to interest rate risk, mainly in relation to
the bank overdraft and borrowings in CAD that affect the Group’s earnings in Swiss francs.
Sensitivity analysis with respect to interest rate risk
The sensitivity analysis covers only the effects of changes in interest rates on short- and long-
term borrowings in CAD and their impact on the financing costs and the profit for the year.
Based on the Group’s variable interest-bearing borrowings existing at December 31, 2024, a 2%
increase and 2% decrease in interest rates would result in a decrease of CHF 689,071 and an
increase of CHF 689,299 in profit, respectively.
Liquidity risk management: The aim of liquidity risk management is to provide sufficient cash to
meet the Group’s financial liabilities on time while maintaining the flexibility to take advantage
of market opportunities and optimum investment conditions. The Group’s credit standing
enables it to borrow cash for financing at an advantageous rate.
The liquidity risk is mitigated by the cash at disposal, and the large securities portfolio made
exclusively of listed shares easily realisable on the equity markets.
At December 31, 2024, the Group had the following undrawn committed borrowing facilities
available:
2024
2023
CHF
CHF
Expiring less than 1 year
1,362,620
3,714,025
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SOFISA SA
The following tables detail the Group’s remaining contractual maturity for its non-derivative
financial liabilities. The tables have been drawn up based on the undiscounted cash flows of
financial liabilities based on the earliest date on which the Group can be required to pay. The
table includes both interest and principal cash flows.
2024
Weighted
average
Less
More
effective
than
than
interest rate
1 year
1 - 5 years
5 years
Total
%
CHF
CHF
CHF
CHF
Non-interest bearing
Trade and other
payables
-
11,308,803
-
-
11,308,803
Other liabilities
-
9,601,538
63,010
-
9,664,548
Preference shares
-
-
2,252,925
-
2,252,925
Interest bearing
Bank overdraft
6.20%
37,914,842
-
-
37,914,842
Short term borrowings
5.70%
1,290,130
-
-
1,290,130
Long term borrowings
5,70%
1,409,313
25,429,443
-
26,838,755
Mezzanine loans
12.45%
870,505
7,427,262
-
8,297,768
62,395,131
35,172,640
-
97,567,771
2023
Weighted
average
Less
More
effective
than
than
interest rate
1 year
1 - 5 years
5 years
Total
%
CHF
CHF
CHF
CHF
Non-interest bearing
Trade and other
payables
-
8,513,728
-
-
8,513,728
Other liabilities
-
5,545,028
63,830
-
5,608,858
Preference shares
-
-
2,256,300
-
2,256,300
Interest bearing
Bank overdraft
8.20%
33,270,202
-
-
33,270,202
Long term borrowings
14.20%
1,466,079
12,890,138
-
14,356,217
48,795,037
15,210,268
-
64,005,305
- 40 -
SOFISA SA
Reconciliation of liabilities arising from financing activities
The table below details changes in the Group liabilities arising from financing activities,
including both cash and non-cash changes. Liabilities arising from financing activities are
those for which cash flows were, or future cash flows will be, classified in the Group
consolidated financial statement of cash flows as cash flows from financing activities.
Non-cash changes
Foreign
Other
January 1
Cash flows
exchange
Transfer
changes
December 31
2024
movements
2024
Short term part of
interest bearing
liabilities
30,748,800
6,607,775
(395,018)
-
- 36,961,558
Long term part of
interest bearing
liabilities
10,324,500
21,524,931
(132,635)
-
- 31,716,796
63,010
Other liabilities
63,830 - (820) - -
Preference
52,925
2,2
shares
2,256,300
(102,600)
- - 99,225
70,994,289
43,393,430 28,030,107
(528,473)
- 99,225
Non-cash changes
Foreign
Other
January 1
Cash flows
exchange
Transfer
changes
December 31
2023
movements
2023
Short term part of
interest bearing
liabilities
54,178,472 (21,380,993)
(2,048,679)
-
- 30,748,800
Long term part of
interest bearing
liabilities
9,339,960
1,594,530
(609,990)
-
-
10,324,500
63,830
Other liabilities
68,290 - (4,460) - -
Preference
2,256,300
shares
2,260,800
(111,600)
- -
107,100
43,393,430
65,847,523 (19,898,063)
(2,663,129)
- 107,100
Other changes include the transactions directly recognised in the statement of income.
31) RISK ASSESSMENT
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SOFISA SA
The Board of Directors has performed a risk assessment on November 14, 2024.
32) DISCLOSURE OF BOARD COMPENSATION UNDER SECTION 959 OF SWISS CODE OF OBLIGATIONS
2024
2023
Remuneration (net)
(291,765)
(267,373)
Contribution for old age and survivor
insurance and unemployment insurance
(10,767) (17,406)
Total indemnity
(302,532)
(284,779)
33) DISCLOSURE OF BOARD SHAREHOLDINGS UNDER SECTION 959 OF SWISS CODE OF
OBLIGATIONS
The ownership interests in SOFISA SA held by members of the Board of Directors are disclosed
below.
Number of shares
Voting rights
2024
2023
2024
2023
The Most Hon. Constantine Edmund
Walter Phipps Marquis of Normanby
1,102
551
4,44%
7.92%
Member of the Board of Directors
34) APPROVAL OF FINANCIAL STATEMENTS
The financial statements were approved by the Board of Directors and authorised for issue on
April 9, 2025.
35) ESEF REPORTING
The official version of the Annual Report of SOFISA SA, which includes the consolidated
financial statements is the European Single Electronic Format (ESEF) version available with the
Officially Appointed Mechanism (OAM) tool.
36) SUBSEQUENT EVENTS
Since the end of the year, the Group sold a portion of either undeveloped land to the District
of West Vancouver for CAD 16,000,000 or CHF 10,081,600 and in return received CAD
7,494,938 or CHF 4,722,560 in cash and undeveloped land previously owned by “District of
west Vancouver and situated in the Cypress Village development area.
In a meeting before public notary held on 4 February 2025, the Board of Directors of SOFISA
SA decided to execute the decision made by the EGM of 26 November 2024, to reduce the
capital from CHF 6,165,000 to CHF 5,444,000 and the amount of this reduction was allocated
to the cancellation of the negative own capital share reserve in the shareholders’ equity, in
the amount of CHF 149,252,768.
Since the end of the year, there have been no other events which would significantly affect
the Group result as reported in the consolidated financial statements for the year 2024.
- 42 -