S O F I N A
S O F I N A
Naamloze Vennootschap Maatschappelijke zetel: Xxxxxxxxxxxxxxxxx 00, 0000 Xxxxxxx
Ondernemingsnummer: 0403.219.397 (RPR Brussel)
(de “Vennootschap” of “Sofina”)
GEWONE ALGEMENE VERGADERING VAN 2 MEI 2019
NOTULEN
Op donderdag twee mei tweeduizend en negentien, om vijftien uur, zijn de dames en de heren aandeelhouders van Sofina, naamloze vennootschap, op de maatschappelijke zetel, Xxxxxxxxxxxxxxxxx 00, 0000 Xxxxxxx, in Gewone Algemene Vergadering bijeengekomen.
BUREAU
Xxx Xxxxx Xxxxx zit de Algemene Vergadering voor.
X. xx Xxxxxxxxxx wijst als secretaris de xxxx Xxxxxxxx xx Xxxxxxxxxxxx aan en als stemopnemers xxxxxxx Xxxxxx Xxxxx en de xxxx Xxxxxxx Xxxxxx, die als aandeelhouders aanwezig zijn en de opdracht aanvaarden.
M. de Voorzitter bedankt de aanwezige aandeelhouders en bestuurders.
NEERLEGGING VAN DE STUKKEN
M. de Voorzitter legt de volgende stukken op het bureau neer:
1. de bewijsnummers van de kranten waarin de oproepingen tot deze Algemene Vergadering met de dagorde en formaliteiten om hieraan te kunnen deelnemen werden gepubliceerd, met name:
- Het Belgisch Staatsblad van 2 april 2019;
- L’Echo en De Tijd van 2 april 2019.
2. de oproepingsbrieven en e-mails met de oproeping voor deze Algemene Vergadering met de dagorde en formaliteiten om hieraan te kunnen deelnemen gericht aan de aandeelhouders op naam, aan de bestuurders van de Vennootschap en aan de Commissaris.
3. de xxxxxxxxxxxxxxxxxx, waaruit blijkt dat 631 aandeelhouders aanwezig of vertegenwoordigd zijn en die samen 21.972.227 stemgerechtigde aandelen bezitten, dat wil zeggen 65,21% van het kapitaal1.
4. het register met het aantal aandelen waarvoor de aandeelhouders ingeschreven waren op 18 april 2019 om middernacht (registratiedatum), hetzij in het register van de aandeelhouders op naam, hetzij op een effectenrekening bij een financiële instelling en die ten laatste op 26 april 2019 om 16 uur (Belgische tijd), te kennen gegeven hebben dat ze xxxxxx deel te nemen aan de Vergadering.
1 Onder kapitaal verstaat men alle aandelen met stemrechten, zijnde 33.695.484 aandelen (34.250.000 aandelen min 554.516 eigen aandelen).
5. het verslag van de Raad van Bestuur, de balans en de resultatenrekening van het boekjaar 2018 alsmede de bijlage, opgesteld door de Raad van Bestuur en goedgekeurd door de Commissaris.
De Algemene Vergadering stelt vast dat alle wettelijke en statutaire formaliteiten werden vervuld en dat zij geldig samengesteld zijn om te beraadslagen over haar dagorde.
DAGORDE
De Algemene Vergadering stelt M. de Voorzitter vrij van de voorlezing van volgende dagorde:
1. Verslagen en jaarrekening
1.1 Mededeling van het verslag van de Raad van Bestuur en van het verslag van de Commissaris over het boekjaar 2018.
1.2 Mededeling van de geconsolideerde jaarrekening over het boekjaar 2018.
1.3 Goedkeuring van de jaarrekening voor het boekjaar 2018 en toewijzing van het resultaat.
Voorstel tot goedkeuring van de op 31 december 2018 afgesloten jaarrekening van de Vennootschap, met inbegrip van de bestemming van het resultaat en de uitkering van een unitair brutodividend van 2,785714 EUR
2. Remuneratieverslag
Voorstel tot goedkeuring van het remuneratieverslag over het boekjaar 2018.
3. Kwiiting aan de bestuurders en de commissaris
3.1 Voorstel om kwijting te verlenen aan de bestuurders voor de uitoefening van hun mandaat gedurende het boekjaar 2018.
3.2 Voorstel om kwijting te verlenen aan de Commissaris voor de uitoefening van zijn mandaat gedurende het boekjaar 2018.
4. Herbenoemingen van bestuurdersmandaten en vaststelling van de vergoedingen
De bestuurdersmandaten xxx xx xxxxx Xxxxxx Xxxx, Xxxxxx Xxxxxxx en Xxx Xxxxxxxxxxx vervallen op het einde van de Gewone Algemene Vergadering van 2 mei 2019.
Op aanbeveling van het Benoemingscomité en op voorstel van de Raad van Bestuur
voorstel tot herbenoeming van de volgende mandaten:
4.1 de heer Xxxxxx Xxxx voor een periode van drie jaar, dat op het einde van de Gewone Algemene Vergadering van 2022 vervalt. Zoals vermeld in het remuneratieverslag, zal de heer Xxxxxx Xxxx geen vergoeding in zijn hoedanigheid van bestuurder ontvangen.
4.2 de heer Xxxxxx Xxxxxxx voor een periode van vier jaar, dat op het einde van de Gewone Algemene Vergadering van 2023 vervalt. Zijn vergoeding zal, zoals voor alle bestuurders, met uitzondering van de Gedelegeerd Bestuurder, vastgesteld worden op basis van artikel 36 van de statuten.
4.3 de heer Xxx Xxxxxxxxxxx, voor een periode van vier jaar, dat op het einde van de Gewone Algemene Vergadering van 2023 vervalt en zijn onafhankelijkheid vast te stellen overeenkomstig artikel 526ter van het Wetboek van Vennootschappen, zolang hij voldoet aan alle criteria uiteengezet in dit artikel. Zijn vergoeding zal, zoals voor alle bestuurders, met uitzondering van de Gedelegeerd Bestuurder, vastgesteld worden op basis van artikel 36 van de statuten.
5. Verwerving en verkoop van eigen aandelen – vernieuwing van de machtiging gegeven aan de Raad van Bestuur
Voorstel tot hernieuwing van de machtiging gegeven aan de Raad van Bestuur van de Vennootschap en aan de raden van bestuur van de dochterondernemingen die zij controleert aangaande de inkoop en/of vervreemding van eigen aandelen op de beurs, in overeenstemming met de statuten van de Vennootschap en het Wetboek van Vennootschappen door middel van uitkeerbare bedragen overeenkomstig artikel 617 van het Wetboek van Vennootschappen, voor een periode van vijf jaar vanaf 2 mei 2019, een maximum van 20% van het totaal aantal aandelen uitgegeven door de Vennootschap voor een prijs of tegenwaarde van ten hoogste de gemiddelde beurskoers van de Vennootschap op Euronext Brussels gedurende de tien dagen voorafgaand aan de inkoop, vermeerderd met 15% en ten minste 1 EUR. Derhalve de voorheen toegekende tijdelijke machtiging voor de inkoop en vervreemding eigen aandelen toegekend door de Gewone Algemene Vergadering van 2 mei 2014 te beëindigen.
6. Diversen
***
VERSLAG VAN DE RAAD VAN BESTUUR, REMUNERATIEVERSLAG, VERSLAG VAN DE COMMISSARIS, GECONSOLIDEERDE JAARREKENING EN ENKELVOUDIGE JAARREKENING
De brochure met het volledige jaarverslag van de Vennootschap, met inbegrip van de verslagen van de Raad van Bestuur, de verklaring inzake deugdelijk bestuur, het remuneratieverslag en het verslag van de Commissaris voor het boekjaar 2018 alsmede de geconsolideerde rekeningen en een verkorte versie van de enkelvoudige jaarrekening afgesloten op 31 december 2018, werd op 28 maart 2019 na 17u40 integraal op de website van de Vennootschap gepubliceerd, en naar de aandeelhouders op naam op 2 april 20192 of op aanvraag van de aandeelhouders verstuurd. De integrale versie van de enkelvoudige jaarrekening, met inbegrip van de sociale balans, werd op 28 maart 2019 na 17u40 op de website van de Vennootschap gepubliceerd. De Algemene Vergadering stelt het bureau vrij van de voorlezing ervan.
Na een toespraak van de Voorzitter gehouden op de Algemene Vergadering van Xxxxxx die hij voorzit, een presentatie van de hoogtepunten van 2018 door de CEO, en een presentatie van de Voorzitster van de Remuneratiecomité antwoorden zij, in naam van de Raad van Bestuur, op de tijdens de vergadering of schriftelijk gestelde vragen. Een samenvatting van deze vragen en antwoorden zal bij deze notulen worden gevoegd om binnen 15 dagen na de Algemene Vergadering op de website van de Vennootschap te worden gepubliceerd.
Vervolgens wordt overgegaan tot de stemming over de besluiten zoals bepaald in de dagorde.
1. Verslagen en jaarrekening
1.1. Het verslag van de Raad van Bestuur en het verslag van de Commissaris over het boekjaar 2018 zijn aan de Algemene Vergadering voorgelegd.
1.2. De geconsolideerde jaarrekening over het boekjaar 2018 is aan de Algemene Vergadering voorgelegd.
1.3. De Algemene Vergadering keurt de jaarrekening van de Vennootschap op 31 december 2018 goed, met name de balans en de resultatenrekening over het boekjaar 2018, alsmede de bijlage, zoals ze door de Raad van Bestuur voorgelegd zijn en zoals ze bij dit proces-verbaal zijn gevoegd, met inbegrip van de volgende verdeling van het te bestemmen resultaat van het boekjaar 2018:
Bestemming van het resultaat van Xxxxxx NV voor het boekjaar 2018 | ||
Overgedragen winst (in EUR) | Beschikbare reserves (in EUR) | |
Saldo op 31/12/2017 | 1.236.498.256 | 928.632.614 |
Winst van het boekjaar | 185.602.151 | |
Brutodividend van 2,785714 EUR per aandeel | (95.410.714) | |
Bestuurders | (2.003.625) | |
2 Geregistreerde aandeelhouders die schriftelijk hebben meegedeeld dat zij het jaarverslag en de documenten met betrekking tot deze Algemene Vergadering in elektronische vorm wensen te ontvangen, hebben deze documenten per e-mail ontvangen op 2 april 2019.
Bestemming aan de beschikbare reserves | (171.367.386) | 171.367.386 |
Saldo op 31/12/2018 | 1.153.318.681 | 1.100.000.000 |
Variatie | (83.179.575) | 171.367.386 |
Het unitair brutodividend van 2,785714 EUR (dus een unitair nettodividend van 1,95 EUR) zal betaalbaar worden gesteld vanaf 13 mei 2019 in ruil voor coupon nr. 21.
Deze resolutie wordt aangenomen met een meerderheid van 99,83% van de stemmen, hetzij 21.934.028 stemmen voor, 19.874 stemmen tegen en 18.325 onthoudingen.
2. Remuneratieverslag
De Algemene Vergadering bevrijdt de Voorzitter van het lezen van het remuneratieverslag en erkent dat hij dit rapport heeft ontvangen.
De Algemene Vergadering keurt het remuneratieverslag van de Raad van Bestuur voor het boekjaar 2018 goed.
Deze resolutie wordt aangenomen met een meerderheid van 99,85% van de stemmen, hetzij 21.938.679 stemmen voor, 32.848 stemmen tegen en 700 onthoudingen.
3. Kwijting aan de bestuurders en de commissaris
3.1. De Algemene Vergadering verleent via een speciale stemming overeenkomstig artikel 554, tweede lid van het Wetboek van Vennootschappen, kwijting aan de dames en heren bestuurders voor hun mandaat over het boekjaar afgesloten op 31 december 2018.
Deze resolutie wordt aangenomen met een meerderheid van 99,89% van de stemmen, hetzij 21.947.241 stemmen voor, 2.077 stemmen tegen en 22.909 onthoudingen.
3.2. De Algemene Vergadering verleent via een speciale stemming overeenkomstig artikel 554, tweede lid van het Wetboek van Vennootschappen, kwijting aan de heer Commissaris voor zijn mandaat over het boekjaar afgesloten op 31 december 2018.
Deze resolutie wordt aangenomen met een meerderheid van 99,84% van de stemmen, hetzij 21.936.620 stemmen voor, 12.698 stemmen tegen en 22.909 onthoudingen.
4. Herbenoemingen van bestuurdersmandaten en vaststelling van de vergoedingen
4.1. De Algemene Vergadering stelt vast dat het mandaat van bestuurder van de heer Xxxxxx Xxxx aan het einde van deze Gewone Algemene Vergadering vervalt.
De Algemene Vergadering keurt de hernieuwing van het bestuurdersmandaat van de heer Xxxxxx Xxxx voor een periode van drie jaar, eindigend op de Gewone Algemene Vergadering van 2022, goed. Zoals vermeld in het remuneratieverslag, zal de heer Xxxxxx Xxxx geen vergoeding in zijn hoedanigheid van bestuurder ontvangen.
Deze resolutie wordt aangenomen met een meerderheid van 99,71% van de stemmen, hetzij 21.907.746 stemmen voor, 63.781 stemmen tegen en 700 onthoudingen.
4.2. De Algemene Vergadering stelt vast dat het bestuurdersmandaat van de heer Xxxxxx Xxxxxxx aan het einde van deze Gewone Algemene Vergadering vervalt.
De Algemene Vergadering keurt de hernieuwing van het bestuurdersmandaat van de heer Xxxxxx Xxxxxxx voor een periode van vier jaar, eindigend op de Gewone Algemene Vergadering van 2023, goed. Zijn vergoeding zal, zoals voor alle bestuurders, met uitzondering van de Gedelegeerd Bestuurder, vastgesteld worden op basis van artikel 36 van de statuten.
Deze resolutie wordt aangenomen met een meerderheid van 89,71% van de stemmen, hetzij 19.711.805 stemmen voor, 2.144.799 stemmen tegen en 115.623 onthoudingen.
4.3. De Algemene Vergadering stelt vast dat het bestuurdersmandaat van de heer Xxx Xxxxxxxxxxx aan het einde van deze Gewone Algemene Vergadering vervalt.
De Algemene Vergadering keurt de hernieuwing van het bestuurdersmandaat van de heer Xxx Xxxxxxxxxxx voor een periode van vier jaar, eindigend op de Gewone Algemene Vergadering van 2023, goed en stelt zijn onafhankelijkheid als bestuurder vast, overeenkomstig artikel 526ter van het Wetboek van Vennootschappen, gelet op het feit dat hij voldoet aan alle criteria uiteengezet in dit artikel. Zijn vergoeding zal, zoals voor alle bestuurders, met uitzondering van de Gedelegeerd Bestuurder, vastgesteld worden op basis van artikel 36 van de statuten.
Deze resolutie wordt aangenomen met een meerderheid van 99,65% van de stemmen, hetzij 21.894.843 stemmen voor, 71.950 stemmen tegen en 5.434 onthoudingen.
5. Verwerving en verkoop van eigen aandelen – vernieuwing van de machtiging gegeven aan de Raad van Bestuur
De Algemene Vergadering keurt de hernieuwing van de machtiging gegeven aan de Raad van Bestuur van de Vennootschap en aan de raden van bestuur van de dochterondernemingen die zij controleert aangaande de inkoop en/of vervreemding van eigen aandelen op de beurs, in overeenstemming met de statuten van de Vennootschap en het Wetboek van Vennootschappen door middel van uitkeerbare bedragen overeenkomstig artikel 617 van het Wetboek van Vennootschappen, voor een periode van vijf jaar vanaf 2 mei 2019, een maximum van 20% van het totaal aantal aandelen uitgegeven door de Vennootschap voor een prijs of tegenwaarde van ten hoogste de gemiddelde beurskoers van de Vennootschap op Euronext Brussels gedurende de tien dagen voorafgaand aan de inkoop, vermeerderd met 15% en ten minste 1 EUR goed. Derhalve de voorheen toegekende tijdelijke machtiging voor de inkoop en vervreemding eigen aandelen toegekend door de Gewone Algemene Vergadering van 2 mei 2014 te beëindigen.
Deze resolutie wordt aangenomen met een meerderheid van 96,27% van de stemmen, hetzij 21.152.339 stemmen voor, 809.227 stemmen tegen en 10.661 onthoudingen.
6. Diversen
BEËINDIGING VAN DE ZITTING
Aangezien de dagorde afgewerkt is, gelet op het feit dat er geen ‘diversen’ zijn, en het proces-verbaal aanvaard werd, nodigt de Voorzitter de dames en heren aandeelhouders om desgewenst samen met de leden van het bureau, het proces-verbaal na deze vergadering te ondertekenen. De zitting wordt opgeheven om 16 uur.
De Secretaris, De Voorzitter,
De Stemopnemers,
GEWONE ALGEMENE VERGADERING VAN 2 MEI 2019 ASSEMBLEE GENERALE ORDINAIRE DU 2 MAI 2019
Antwoorden op gestelde vragen / Réponses aux questions
I. Schriftelijke vragen / Questions posées par écrit
1. What are the plans for the upcoming investments? Are there some in the pipeline? What sectors are seen as attractive at the moment?
We are currently reviewing a few new investment opportunities across our three investment styles. We however never comment publicly on new transactions before closing.
As explained earlier today, as a result of the strategic review conducted by the Board, we have decided to focus our efforts on four specific sectors being consumer, healthcare, digitalisation and education. This however does not mean that we will no longer invest in other sectors.
2. Which are the sectors that the group wants to exit or is considering divesting from?
As for potential new investments, we do not comment on potential divestments before completion of such transactions.
3. What is the dominant market narrative at the moment for management?
As explained earlier, one of the main conclusions of the strategic exercise was that we need to focus on specific growth sectors and to gain specific knowledge in these areas. This will allow us to increase our added value towards our investment partners and to bring more expertise around the table.
Consumer, healthcare, digitalisation and education have been identified as focus sectors for Sofina. As a result, our investment teams will concentrate their efforts on these sectors.
An important narrative remains the abundance of liquidities seeking returns and driving asset prices upwards.
4. Any big failures Xxxxxx learned something from?
Every new investment or divestment opportunity allows management to gain more expertise in a field or a sector, to learn from the interactions we had with the management of the target or from our own investment analysis, even if the deal ultimately does not go through.
Failures can also bring their added values to our learning curve. After all important projects, irrespective of whether it became a failure or a success, we take a step back and proceed to a so- called ‘post-mortem exercise’. We analyse what went well, what when wrong and what we can improve. We then use these lessons learned to improve our approach and process towards new investment opportunities.
In terms of risk versus rewards, we also note that investments made in our third investment style, which relates to investments in fast-growing businesses - which was especially busy during the past year – potentially generate higher returns but have also increased risks of failure, as the companies in which we invest are in an earlier growth stage. The risk of failure in this investment style is mitigated by lower investment tickets and a geographical and sector diversification.
This being said, failing every once in a while, is part of the investment business; this is also why we diversify the risks we take.
5. Could you tell us what is the approximate cost of management for the third ‘Fonds de capital-risque et de capital-développement’ pillar? Also, what is the approximate length of the Lockup periods?
The cost related to our private equity fund activity, the so-called second investment style, are included in the capital calls and distributions we receive; it is therefore not possible for us to separate them for the rest of our costs. Post IPO lock-up usually ranges between 6 to 12 months.
6. Could management comment on the Fewer deals more Money in VC's? When will prices become too high for Sofina? Is this defined at all?
When Xxxxxx takes an investment decision, it always proceeds to a valuation of the target company and analyses its potential return on investment over the long term. The decision to proceed to an investment at a certain valuation is made considering the specificities of the transaction and of the target company (such as the governance, management, growth potential, exit options, the buyers’ universe, etc.). We therefore have no fixed cap on valuation for so long as we can expect a decent risk/return profile.
7. Given the world is awash with capital at the moment (think 100B Vision fund) what advantage does Sofina think to have in this investment space => ‘Fonds de capital- risque et de capital-développement’?
Sofina is a long-term minded, evergreen investment holding, and has been building relationships with General Partners (GPs) over decades, supporting them across fundraising cycles. This long-term relationship allows us to have access to the best General Partners and to excellent funds.
In addition, our ability to introduce portfolio companies to relevant relationships within our large network, across different industries and geographies, makes Sofina a valuable partner with whom VC and growth funds want to continue working.
As you know, our third investment style, Sofina Growth, relates to co-investments alongside our GPs in certain of their portfolio companies. We can then also financially support the portfolio companies of our GPs by investing in later-stage rounds.
We are aware though that the present market situation requires us to work harder/smarter.
8. What is the value of Cambridge associates to shareholders? What holding horizon is envisioned?
We do not disclose the value of investments in a given portfolio company or our entry valuation.
On 31 December 2018, our shareholding in Cambridge Associates represented 20.8 % of Cambridge Associates’ share capital. As for all our investments, especially in this investment style, we take a long-term view in this company.
9. Same question for First Eagle. Why are these two active managers chosen? What other options where considered?
As indicated in our answer to the previous question, we do not disclose the value of this investment. We only disclose our shareholding in the company (4.7 % indirect shareholding in this case).
Both investments were made because these companies are strong performers in their sector and Sofina is building a long-term relationship with these companies and their reference shareholders.
Xxxxxx’x investment in First Eagle dates back from August 2016. As for many of our investments in our first investment style, we are invested in this company together with the founding family shareholders. Our aim is to support this family by providing them patient capital. Since this company is performing well and the relationships with the reference shareholders are good, we also increased our stake in First Eagle twice since our first investment, once in June 2017 and once June 2018, through GoldIron, the family holding vehicle.
Sofina’s investment in Cambridge Associates is more recent, it closed in May 2018. However, the relationship is a long-term one since Xxxxxx has been an advisory client of Cambridge Associates for many years. In 2018 Cambridge completed this transaction in which several of Cambridge clients
purchased minority interests in the firm. Xxxxxx took the lead of this transaction and became one of the largest minority shareholders.
10. Having asked this, in the annual report of Berkshire they explain sources of leverage that they apply. One is because through ownership of an insurance company they can leverage its float. Given that because of low-interest rates the European insurances are trading below their value would management envision buying an insurance business?
We are not considering investing in traditional insurance companies since they fall outside the scope of our business. It could however be a very good investment, but for the moment these do not belong to our focus sectors.
11. Would you mind sharing the reasons management seems to be selling a lot of stock? I am thinking of Xxxxxx Xxxxxxx and Xxxxxx Xxxxxxx in particular? The reason I am asking is that I don't see why Xxxxxx would let us know its NAV value was about EUR 183 at the end of June 2018.
The reason why some members of management are exercising stock options and/or selling Sofina shares is a personal decision that belongs to them. As mentioned in the remuneration report, the stock option plan is an important part of the variable remuneration of the managers, and a clear incentive over the long term.
When exercising options or selling shares, management is subject to legal and internal rules that prevent them to perform any transaction during closed periods in accordance with the Market Abuse Regulation. In addition, members of the Executive Committee are also required to disclose their transactions to the FSMA.
Xxxxxx started issuing a bi-annual newsletter in January 2018 to allow its shareholders to follow the evolution of its non-audited shareholders’ equity throughout the year and to provide them with the latest news on its key investment activities.
12. What is the main challenge Xxxxxx is facing at the moment? What steps is it taking to handle them?
The main challenges we are facing at the moment is the fact that the world is changing extremely rapidly which creates opportunities and risks. It creates above all the necessity for us to work with our sharpest pencils.
13. What is Xxxxxx doing in order to attract (and keep) the best investment talent?
We try to offer competitive remunerations and we review regularly our compensation policy.
We also formalised our CSR policy because people - and especially young people nowadays - want to be able to identify the corporate social responsibility policies of the companies they work for. They want to be proud of the company they work for. Having such a policy and let employees define it is part of retaining and motivating talent.
Finally, in order to continuously improve their skills and increase their competencies we spent last year about EUR 185,000 on training of our workforce and this is an average year, it has been more in the past.
14. How / why are minority positions in public companies an advantage to shareholders?
Xxxxxx always invests as a minority shareholder in listed and non-listed companies. Being the minority shareholder of a listed company does not mean you are a passive shareholder and you have no added value.
As for non-listed companies, we often have representatives at the board in these companies and are members of board committees such as the audit committee and the nomination and remuneration committee.
This allows us to be present in the fora in which important decisions are taken and to closely follow the strategic choices of these companies. We are also building excellent relationships with the reference shareholders. For example, we are invested in Colruyt for more than four decades and in Danone since 1987.
Finally, these positions also help us with the diversification of our portfolio.
15. Given the 30% tax on dividends for Belgian shareholders would you consider increasing the current limit of share buybacks to the benefit small long-term shareholders? It does take around 15k of invested capital to be able to buy back one share with the dividend income. Moreover, with the yield of the dividend at around 2%, I would prefer to see even more absolute return instead of this low yield.
Given the tax on dividend and as this assembly is aware, we have an item on the agenda to authorise us in the coming 5 years to pursue our share buyback policy.
16. What is the recent intrinsic value of Sofina?
The shareholders’ equity per share on 30 April 2019 amounts to EUR 202.2. This is an unaudited figure, based on the number of outstanding shares on 30 April 2019, after payment of dividends and directors’ fees and on the basis of a valuation on 31 December 2018 of non-listed holdings.
II. MONDELINGE VRAGEN / QUESTIONS POSÉES ORALEMENT
1. Xxxxxx has made an investment together with xxx Xxxxxx Family. Can you say a couple of words about that? Is it a one off, or are there any plans for future collaborations?
We indeed made an investment in Cognita, a global network of private schools with xxx Xxxxxx family. It is difficult to comment on whether we will pursue other investments with them in the future. We however often look at investment opportunities together with other families who share the same long-term views as we on investments. As a result, we may team up with xxx Xxxxxx family or with another family to pursue another investment.
2. Are share buybacks in the context of covering the stock option plan? Or is it purely an investment?
I would say both. We traditionally always cover the stock options that we grant at roughly the same price at which we granted it. If a large block of shares is available on the stock market and the development of the share price is interesting for us, we may decide to buy a little more than to cover our stock options.
Obviously, it is an easier decision to take when the discount is running at 30% than when it is running at a 10% discount, but there can be instances where we would buy extra shares.
3. In your PE portfolio, I think you have about EUR 800 million of non-called capital. Does the General Partner have limits to invest this? Is this endless or do they have enough time to invest this given the valuation of the market?
The EUR 800 million of uncalled capital is the so-called “dry powder”. You need to realise that the
funds have a long period of time during which they can invest it.
It is usually typically a five-year period during which they can make a capital call. However, if the
LP’s agree, they can extend that somewhat. They then have 10 years to return that capital.
The funds have a certain pressure to invest but this remains reasonable.
4. Could you give us some guidance on how you value the non-quoted? Is it based on the first-year acquisition value, is it on market multiples? To get some idea on how big the fluctuation could be when markets move.
Sofina values the non-quoted participations based on the “fair value” definition as per the IFRS and the IPEV guidelines, so it is not the historical price. The historical price was applied when we were on the Belgian GAAP. IFRS and the IPEV guidelines now impose us to use the fair market value of the investment in our accounts.
As a result, for non-quoted investments, we have to follow a strict valuation process in order to
determine the “fair value” of our non-quoted investments.
The process takes a number of possible methods, it can be based on a price of a recent relevant market transaction, a DCF discounted cashflow calculation, or a calculation based on comparable companies (trading multiples of comparable peers based on Sales or EBITDA metrics for example), as long as it meets the “fair value” definition and accepted valuation methodologies as per the IPEV guidelines.
There is no absolute fixed rule on the valuation method. It is a matter of judgement and it depends on the nature of the company and which valuation method you decide to apply.
In any event, the whole valuation process is extremely well and very rigorously documented and explained in our annual report. Please also note that after having completed this valuation exercise, our valuation is compared to the outcome of the independent valuation performed by Xxxx & Xxxxxx and needs to be reviewed if it falls outside the valuation presented by this latter.
Our statutory auditor is present today can answer your additional questions if needed.
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Annual General Meeting of Shareholders
2 May 2019
We aspire to be the preferred partner of entrepreneurs and families who lead growing companies by backing them with patient capital and supportive advice
Long-term minority investments
New investments
Reinforcements
Partial exits
Investments in venture and growth capital funds
New commitments in our existing portfolio managers
New managers added to our portfolio
Sofina Growth ─ Investments in fast-growing businesses
Asia
New investments
Europe
U.S.
Xinyu
Reinforcements
Exit
Partial exit
Overview of annual consolidated results (in EUR m) | 2018 | 2017(1) | Variation |
Shareholders’ equity | 6,543.6 | 5,778.4 | 13.2% |
Net profit (share of the group) | 861.1 | 499.1 | 72.5% |
Amounts per share (in EUR) | 2018 | 2017(1) | Variation |
Shareholders’ equity(2) | 194.28 | 171.75 | 13.1% |
Net profit (share of the group) (3) | 25.59 | 14.83 | 72.6% |
Gross dividend(4) | 2.79 | 2.67 | 4.5% |
Net dividend | 1.95 | 1.87 | 4.3% |
Total Shareholder Return (in %) | 14.8% | 9.4% | 5.4% |
(1)The figures relating to 2017 have been restated in accordance with IAS 28, §18 to ensure that the
shareholders’ equity for 2017 can be compared to 2018.
(2) Calculation based on the number of outstanding shares per year end (33,681,297 shares in 2018 and 33,644,742 shares in 2017).
(3) Calculation based on the average number of outstanding shares for the year (33,654,106 shares in 2018 and 33,653,648 shares in 2017).
(4) The gross dividend (not rounded up) amounts to EUR 2.785714 in 2018 against EUR 2.671429 in 2017.
Strategy Review
Look back 2014-2018:
- 2014 review had defined Asia, Technology and growth as directions of travel for 2014- 2020
- Opening of Singapore office, launch of Sofina Growth investment style to support the
priority
For 2018-2024:
- Confirmation of the direction of travel, with ambition to pursue growth opportunities globally
- Increased risks, maintain healthy diversification between Regions Europe/US/Asia.
- Increased competition leads to the need of specialisation in certain sectors.
Formalization of Consumer, Digital, Education and Healthcare as focus sectors.
Internal evolutions
• Implementation of new IT architecture ongoing in 2019: move to standard ERP, to cloud based O365 suite and infrastructure,
• Corporate Social Responsibility moving towards the heart of investment approach: committing to follow United Nations Principles for Responsible Investment
• Third-party appraisal of the valuation of our holdings in unlisted companies
Reinforcement of teams
• Investment, Tax & Legal and Corporate teams, with a focus on increasing diversity across our three offices
• Long term incentives are twofold:
• Plain vanilla stock options grant / vesting after 3 years
• Long Term Incentive Plan (LTIP) introduced in 2017 and described below.
• The LTIP has been adopted by the AGM in 2017 and implemented with a first vesting at the end of 2017.
• Its aim is to better align the variable remuneration of the senior management with the interests of the shareholders.
• It compares the evolution of Xxxxxx’x Net Asset Value per Share (« NAVPS »), dividend reinvested, with a benchmark, the MSCI All Countries World Index in EUR, over a rolling 4-year period.
• The “payout” depends on the number of Performance Share Units (PSU) effectively vested after the 4-year period.
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• The number of PSU vested (and as a consequence, the payout) depends on the results of the performance test run over the 4-year period (from no vesting of the PSU if underperformance vis-à-vis the MSCI to 100% vesting if the NAVPS has a performance of 4% (or more) compared to the performance of the MSCI).
• Result of the 2015-2018 cohort: overperformance of Xxxxxx’x ANAVPS(1) vs. the performance of the MSCI All Countries World Index in EUR.
ANAVPS Performance | MSCI ACWI Performance | ANAVPS vs MSCI ACWI | ||||
Annualized performance 2015-2018 | 10.6% | 5.8% | 4.84% | |||
(1)The ANAVPS at the beginning and at the end of each financial year is equal to the NAVPS, reduced by an amount equal to twice the gross dividend per share paid in that year. This adjustment of the NAVPS has been approved by the Board in November 2018. It applies to all the cohorts vesting after November 2018.
• As a result, 100% of the allocated PSU (57,238) did vest, resulting in a EUR 11.6M pay-out to the management and support group (circa 35 members) in respect of 2018.
• As a reminder, in 2017 no bonus was paid pursuant to the LTIP since Xxxxxx’x NAVPS underperformed the MSCI ACWI
for the 2014-2017 cohort. No payment was made under the LTIP
NAVPS Performance | MSCI ACWI Performance | NAVPS vs MSCI ACWI | ||||
Annualized performance 2014-2017 | 10.7% | 11.8% | -1.1% | |||
Plain Vanilla Stock Options
• 114,500 options granted in 2018 to the management and support group at an exercise price of 175.67€.
• The number of stock options offered to the CEO and the members of the Executive Committee has been adapted in 2018 to better align them:
• CEO: 30K 🡪 22K
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• Exco: 7.5K 🡪 11K
Corporate social responsibility
Four main themes divided into specific commitments
OUR INVESTMENTS THE UNPRI | OUR PEOPLE | OUR COMMUNITIES | OUR ENVIRONMENT |
1. We incorporate ESG issues into our investment analyses and decision-making processes*. 2. We are active owners and incorporate ESG issues into our ownership policies and practices. 3. We seek appropriate disclosures on ESG issues by the entities in which we invest. 4. We promote the acceptance of the UNPRI within the investment industry. 5. We work together to enhance our effectiveness in implementing the Principles. 6. We report on our activities and progress towards implementing the Principles. | 7. We promote diversity and work as one team. 8. We build a good place to work for all our people and aim at being a responsible employer. 9. We support life-long learning and have a growth mindset approach. | 10. We are socially engaged and support cultural and social development initiatives in our communities. 11. We comply with laws and regulations and favor spirit over the letter. 12. We strive to implement the best governance practices at all levels. | 13. We strive to reduce our environmental footprint. 14. We raise awareness on environmental issues. |
* The UNPRI refer to ESG (Environment, Social and Governance). Xxxxxx however chose for the CSR acronym (Corporate Social Responsability)
Philantropy – the Platform for Education and Talent
The Platform has identified three intervention areas:
2. Granting scholarships to talented young Belgian craftsmen
to support their training in the heritage arts. This allows them to work with the best professionals and trainers of
their discipline in Europe.
1. Granting scholarships to students from Belgian universities
to enable them to complete their education at a renowned university abroad.
3. “Boost for Talents”: to help the transition between secondary school and higher education or university for teenagers from socially deprived environments.
Q&A
Annual General Meeting of shareholders – 2 May 2019
Q&A
• Focus sectors and investment strategy
• Market trends
• Lessons learned from the past
• Management costs and lock up periods
• Strategy considering the availability of capital
• Investments in asset managers: Cambridge Associates and First Eagle
• Investments in insurance businesses
• Transactions in Sofina shares by management
• Challenges ahead
• Attracting and retaining talent
• Minority positions in listed companies
• Share buy backs
06-05-19
• Shareholders’ equity
Proposed Resolutions
Annual General Meeting of shareholders – 2 May 2019
1. Reports and Annual Accounts
2. Remuneration Report
3. Discharge to the Directors and the Statutory Auditor
4. Renewal of Directors’ mandates and setting of their remuneration
5. Share buy-back and disposal of own shares – Renewal of the authorization granted to the Board of Directors
6. Miscellaneous
1. Reports and annual accounts
1.3 Proposal to approve the annual statutory accounts of Sofina SA closed on 31 December 2018, including the allocation of the Company’s results and the distribution of a gross dividend of EUR 2.79 per share (i.e. a net dividend of EUR 1.95 per share)
Allocation of Sofina SA’s profits for the financial year 2018
Retained earnings (in EUR) | Available reserves (in EUR) | |
Balance at 31/12/2017 | 1,236,498,256 | 928,632,614 |
Profit for the period | 185,602,151 | |
Gross dividend of EUR 2.785714 per share | (95,410,714) | |
Directors | (2,003,625) | |
Allocation to the available reserves | (171,367,386) | 171,367,386 |
Balance at 31/12/2018 | 1,153,318,681 | 1,100,000,000 |
Variance | (83,179,575) | 171,367,386 |
2. Remuneration Report
Proposal to approve the Remuneration report relating to the financial year 2018
3. Discharge to the Directors and the Statutory Auditor
3.1 Proposal to grant the discharge to the Directors for their mandate relating to the 2018 financial year
3.2 Proposal to grant discharge to the Statutory Auditor for its mandate relating to the 2018 financial year
4. Renewal of Directors’ mandates and setting of their remuneration
4.1 Proposal to renew the Directors’ mandate of Mr Xxxxxx Xxxx for a term of three years up to and including the Annual General Meeting to be held in 2022. As further specified in the Remuneration report, Mr Xxxxxx Xxxx shall not be entitled to a remuneration in his capacity as a Director.
4.2 Proposal to renew the Directors’ mandate of Mr Xxxxxx Xxxxxxx for a term of four years up to and including the Annual General Meeting to be held in 2023. As for all Directors except the CEO, his remuneration shall be calculated in accordance with article 36 of the articles of association.
4.3 Proposal to renew the Directors’ mandate of Mr Xxx Xxxxxxxxxxx for a term of four years up to and including the Annual General Meeting to be held in 2023 and to acknowledge his independence in accordance with article 526ter of the Companies Code as he complies with all the criteria provided for in this article. As for all Directors except the CEO, his remuneration shall be calculated in accordance with article 36 of the articles of association.
5. Share buy-back and disposal of own shares – Renewal of the authorization granted do The Board of Directors
Proposal to renew the authorization granted to the Board of Directors of the Company and to the boards of directors under the Company’s control to acquire and/or dispose on the stock exchange, in accordance with the Articles of Association of the Company and the Companies’ Code, by means of sums that may be distributed in accordance with article 617 of the Companies’ Code, for a 5-year period starting on 2 May 2019, a maximum of 20% of the total number of shares issued by the Company, for a price or a maximum consideration equal to the average share price of the Company on Euronext Brussels during the ten days preceding the acquisition increased by 15% and a minimum consideration of 1 EUR.
Consequently, terminate the temporary authorization to acquire and/or dispose of the shares of the Company on the stock market granted by the Annual General Meeting of 2 May 2014.
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