Bank deposits
In 2014, the Group’s short-term funds were primarily held in a current account with PKO Bank Polski S.A., linked under virtual cash-pooling facility with the Group companies’ overdraft sub-facilities. The arrangement enables optimisation of interest income and expense throughout the Group.
Those of Group companies which hold free cash with PKO Bank Polski S.A. earn interest on their deposits netted off with the overdraft facilities at 1M WIBOR annualised rate. At the same time, the Group companies which use the overdraft facility held with PKO Bank Polski S.A. incur the same cost of credit at the 1M WIBOR annualised rate on drawn amounts netted off with the free cash.
Moreover, the Grupa Azoty Group companies maintained other free cash in short-term deposits held with reputable banking institutions offering highest interest rates, in particular rates above the 1M WIBOR annualised rate, on amounts netted off as part of the cash-pooling services.
As at December 31st 2014, the Group companies held a total of PLN 557,975 thousand in bank accounts and short-term deposits, of which PLN 122,363 thousand was held in the current account with PKO Bank Polski S.A. linked with the virtual cash pooling.
All the companies’ cash as at December 31st 2014 is disclosed in the full-year consolidated financial statements of the Grupa Azoty Group for the 12 months ended December 31st 2014, in Note 17 Cash under “Cash and cash equivalents”.
The Group earned a total of PLN 9,741 thousand in interest income on fixed-term deposits and from virtual cash pooling of funds deposited in accounts held with PKO BP S.A.
Equity investments
Business combination at Grupa Azoty PKCh Sp. z o.o.
On March 14th 2014, a merger was effected between Grupa Azoty Jednostka Ratownictwa Chemicznego Sp. z o.o. (as the surviving company) and Regionalne Laboratorium Oceny Mleka Sp. z o.o. (as the acquired company), which resulted in a PLN 135 thousand increase in non-current assets disclosed in the statement of financial position and recognition of the same amount under profit/(loss) on other operating activities.
Establishment of a subsidiary, Grupa Azoty AFRICA S.A., by Grupa Azoty POLICE
On May 7th 2014, Grupa Azoty AFRICA S.A. of Senegal (a joint-stock company) was established as a wholly-owned subsidiary of Grupa Azoty POLICE. The company was registered on September 10th 2014 and has been consolidated since that date.
(for more information see section 1.2 Changes in the Group’s structure of this Report and the full-year consolidated financial statements of the Grupa Azoty Group for the 12 months ended December 31st 2014, Note 1.2 Changes in the Group’s structure).
Disposal of Hotel Centralny Sp. z o.o.’s assets
On November 7th 2014, the assets of Hotel Centralny Sp. z o.o. w likwidacji (in liquidation) were sold (the company was placed in liquidation on May 21st 2013). Under the sale agreement, the perpetual usufruct right to the Hotel Centralny’s land plot and its building along with equipment were sold on the terms specified in relevant resolutions of the General Meeting. The liquidation proceedings are expected to be completed in 2015 and the post-liquidation estate will then be transferred to the company’s sole shareholder – Grupa Azoty ZAK S.A.
Share capital increase at Agrochem Puławy Sp. z o.o.
Under a resolution of the Extraordinary General Meeting of Agrochem Puławy Sp. z o.o. of Puławy, the share capital of the company was increased twice:
- on June 9th 2014, to PLN 42,533.5 thousand, and
- on September 1st 2014, to PLN 50,000 thousand.
The new shares were acquired by Grupa Azoty PUŁAWY, and paid for with cash.
Events after the end of the reporting period
Share capital increase at Agrochem Sp. z o.o.
The Extraordinary General Meeting of Agrochem Sp. z o.o. of Dobre Miasto held on January 22nd 2015 passed a resolution to increase the company’s share capital by PLN 19,500 thousand, to PLN 20,000 thousand, through an issue of 39,000 new shares with a par value of PLN 500 per share; the new shares will be paid for with cash.