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As at 31 December 2018, the Group consisted of: JSW S.A. as the Parent Company and its direct and indirect subsidiaries located in the territory of Poland. Subsidiaries are consolidated by the full method.
As at 31 December 2018, JSW held, directly or indirectly, shares in 19 related companies, including:
JSW Stabilizacyjny Fundusz Inwestycyjny Zamknięty Closed-End Fund was also consolidated.
In the consolidated financial statements, shares in associates (Jastrzębska Strefa Aktywności Gospodarczej Sp. z o.o. in liquidation, Remkoks Sp. z o.o.) are measured by the equity method.
Information on companies comprising the Group and consolidated by the full method is provided below:
* Percentage share determined based on the percentage exposure of the Parent Company to the Fund’s investment certificates.
Item
Company name
Headquarters
Line of business
Percentage of share capital held by Group companies
31.12.2018
31.12.2017
Parent company
1.
Jastrzębska Spółka Węglowa S.A.
(„JSW”)Jastrzębie-Zdrój
Black coal mining and sales, sales of coke and hydrocarbons.
not applicable
Direct subsidiaries
2.
JSW KOKS S.A.
(„JSW KOKS”)Zabrze
Production of coke and hydrocarbons
96.28%
95.72%
3.
JSW Innowacje S.A.
(„JSW Innowacje”)Katowice
The Group’s research and development activity, feasibility studies and oversight over execution of projects and implementations.
100.00%
100.00%
4.
Przedsiębiorstwo Gospodarki Wodnej i Rekultywacji S.A.
(„PGWiR”)Jastrzębie-Zdrój
Provision of water and sewage-related services and discharge of salt water, supply of industrial water, reclamation activity and production of salt.
100.00%
100.00%
5.
Jastrzębskie Zakłady Remontowe
Sp. z o.o.
(„JZR”)Jastrzębie-Zdrój
Service activity pertaining to renovation of machinery and equipment
58.61%
62.55%
6.
Centralne Laboratorium Pomiarowo – Badawcze Sp. z o.o.
(„CLP-B”)Jastrzębie-Zdrój
Technical research services, chemical and physiochemical analyses of minerals, and solid, liquid and gaseous materials and products
99.92%
90.31%
7.
Jastrzębska Spółka Kolejowa
Sp. z o.o.
(„JSK”)Jastrzębie-Zdrój
Provision of railway lines, maintenance of railway infrastructure structures and equipment, construction and repair of railway tracks and facilities
100.00%
100.00%
8.
Advicom Sp. z o.o.
(„Advicom”)Jastrzębie-Zdrój
Consulting with respect to computer hardware; activities related to software and data processing
100.00%
75.06%
9.
JSU Sp. z o.o.
(„JSU”)Jastrzębie-Zdrój
Insurance intermediation and insurance administration pertaining to insurance claims handling, tourist and hotel activity
100.00%
100.00%
10.
JSW Logistics Sp. z o.o.
(„JSW Logistics”)Dąbrowa Górnicza
Rail siding services, transportation of coal and coke, organizing the carriage of cargo and technical maintenance and repair of rail vehicles
100.00%
100.00%
11.
JSW Szkolenie i Górnictwo
Sp. z o.o.
(„JSW SiG”)Jastrzębie-Zdrój
Mining support activity
100.00%
100.00%
12.
JSW Shipping Sp. z o. o.
(„JSW Shipping”)Gdynia
Marine freight forwarding and marine transport agency services
100.00%
100.00%
Indirect subsidiaries
13.
BTS Sp. z o.o.
(„BTS”)Dąbrowa Górnicza
Transportation and general construction services
100.00%
100.00%
14.
ZREM-BUD Sp. z o.o.
(„ZREM-BUD”)Dąbrowa Górnicza
Manufacture of spare parts, assemblies and devices, steel structures, technical equipment, tools and instruments; mechanic and electric repairs and maintenance of automation technology. Provision of renovation and construction services
100.00%
100.00%
15.
CARBOTRANS Sp. z o.o.
(„Carbotrans”)Zabrze
Road transport of goods, mainly hydrocarbons and raw materials for their production
100.00%
100.00%
16.
JZR Dźwigi Sp. z o.o.
(„JZR Dźwigi”)Jastrzębie-Zdrój
Services related to production, upgrade, renovation, upkeep, inspection and repairs of material handling equipment.
84.97%
84.97%
17.
JSW Ochrona Sp. z o.o.
(“JSW Ochrona”)Jastrzębie-Zdrój
Mining support activity, security activity
100.00%
100.00%
18.
Hawk-e Sp. z o.o.
(“Hawk-e”)Jastrzębie-Zdrój
Provision of services using drones for commercial purposes
100.00%
–
Other entities
19.
JSW Stabilizacyjny Fundusz Inwestycyjny Zamknięty („JSW Stabilizacyjny FIZ”)*
Warsaw
The Fund’s only line of business is investment of cash raised through private proposals to purchase Investment Certificates, in the securities, Money Market Instruments and other property rights as specified in the Articles of Association.
100.00%
–
For the purpose of strengthening the capital base of JZR, on 30 September 2016 an agreement was executed by and between the State Treasury and JZR to extend support that is not public aid (“Support Agreement”). The total amount of support will be up to PLN 290.0 million in the form of contributing cash in exchange for shares in JZR’s increased share capital and subscribed for by the State Treasury. This support has been designated to modernize the coal preparation plants of KWK Budryk and KWK Knurów-Szczygłowice. The agreement is performed in three tranches. Carrying out the clauses in this Agreement, on 30 September 2016 JZR’s Extraordinary Shareholder Meeting adopted a resolution to increase JZR’s share capital to PLN 400.5 million by contributing cash totaling PLN 150.0 million (first tranche) by issuing 300,000 new shares with a par value and issue price of PLN 500.00 each. The share capital increase was covered in full with a cash contribution by the State Treasury on 4 November 2016. The capital increase was registered on 16 March 2017. After the increase, JSW’s stake was reduced to 62.55%, while the State Treasury’s stake was 37.45%. Because the deadlines in the project were moved, JZR submitted a request to ARP to change the date on which the State Treasury was to make the second tranche of cash contribution. An annex to the Support Agreement was executed on 27 September 2017. The annex did not identify any specific deadlines for the transfer of subsequent tranches of funds (second and third tranches), because ARP had not received the special-purpose subsidy for the performance of the State Treasury’s obligations under the agreement.
On 13 February 2018 JZR’s Shareholder Meeting adopted a resolution to increase JZR’s share capital to PLN 645.0 million, i.e. by PLN 244.5 million by having JSW and the State Treasury subscribe for 489,000 new shares with a par value and issue price of PLN 500.00 each. JSW subscribed for 249,000 new shares in JZR that were covered with a cash contribution totaling PLN 124.5 million while the State Treasury subscribed for 240,000 new shares covered with a cash contribution totaling PLN 120.0 million (2nd tranche). JSW signed the declaration on the subscription for new shares on 13 February 2018, while the State Treasury signed the agreement to subscribe for the shares on 26 February 2018. After the increase, JSW’s stake has been reduced to 58.14%, while the State Treasury’s stake was 41.86%. The capital increase was registered in the National Court Register on 13 April 2018.
This transaction with non-controlling interest resulted in cash proceeds of PLN 120.0 million presented in the consolidated statement of cash flows in the line item “net payment under the release of shares and capital contributions”.
On 28 May 2018 JZR’s Shareholder Meeting adopted a resolution to increase JZR’s share capital to PLN 652.3 million by having JSW subscribe for 14,561 new shares with a par value of PLN 500.00 per share, while excluding the State Treasury’s right of first refusal to the shares. The JZR’s increased share capital was covered by an in-kind contribution of JSW’s assets with a market value of PLN 7.3 million. After the increase, JSW’s stake increased to 58.61%, while the State Treasury’s stake is 41.39%. The share capital increase was registered in the National Court Register on 22 August 2018.
The impact of these transactions on the consolidated financial statements of the Jastrzębska Spółka Węglowa S.A. Group is discussed in Note 10.3.
On 19 June 2018, the JZR Management Board submitted a request to the JSW Management Board to approve a request to ARP for early settlement of the agreement of 30 September 2016 between JZR and the State Treasury. ARP transferred to JZR two tranches of support funds in the total amount of PLN 270.0 million. On 29 June 2018, the JSW Management Board gave its consent to begin the procedure of obtaining all corporate approvals and conduct legal, tax and financial analyses to carry out the process described above. The JZR Management Board also petitioned to the Minister of Energy in a letter of 14 August 2018 to take a stance in respect to the early repayment of the support funds. In response, the Minister of Energy issued a positive opinion on the matter of early repayment of the support funds, identifying ARP as the entity appropriate for coordinating the repayment process of the support funds.
As at the moment of preparation of these statements, the Group is not obligated to redeem shares of the State Treasury. The work is conducted to determine the permissibility of refunding the support funds received by JZR from the State Treasury and the possible terms on which it could be effected. At the present moment, the terms, the manner and the exact time of settlement of the agreement are not known.
On 10 January 2018, JSW S.A. executed an agreement with JSW Innowacje to purchase 26 shares in POLSKI KOKS FORWARDING & SHIPPING AGENCY Sp. z o.o., with its registered office in Gdynia, representing 100% of the company’s share capital for the total price of PLN 1.9 million. Presently, JSW is the sole shareholder of this company. On 16 January 2018 the company’s modified founding deed was registered with the National Court Register, which led to a change, among others, in the business name to JSW Shipping Sp. z o.o. The transaction has no effect on the consolidated financial statements of the Jastrzębska Spółka Węglowa S.A. Group.
On 20 February 2018, JSW S.A. executed an agreement with JSW Innowacje to purchase 1,510 shares in Centralne Laboratorium Pomiarowo-Badawcze Sp. z o.o. representing 21.33% of CLP-B’s share capital for the total price of PLN 6.8 million. The transaction has no effect on the consolidated financial statements of the Jastrzębska Spółka Węglowa S.A. Group.
On 7 June 2018, the Ordinary Shareholder Meeting of CLP-B adopted a resolution on the acquisition by CLP-B of 681 shares representing 9.62% of all the company’s shares from 25 minority shareholders, i.e. natural persons, for the total amount of PLN 3.1 million for retirement. The 681 shares were transferred to CLP-B and then retired on the date of signing share purchase agreements with the foregoing minority shareholders, i.e. on 7 June 2018. As a result of these processes, JSW now holds 79.23% of shares in CLP-B. This transaction with non-controlling interest resulted in a cash expenditure of PLN 3.1 million presented in the consolidated statement of cash flows in the “transactions with non-controlling interest” line item (purchase of shares from non-controlling interest), which was presented in detail in Note 10.3.
On 11 January 2018, the company JSW Ochrona Sp. z o.o. was registered in the KRS. JSW Ochrona was established on 20 December 2017. The shares were taken up by JSW SiG (95%) and JSK (5%).
On 8 May 2018, the Shareholder Meeting of JSW Ochrona adopted a resolution to increase the company’s share capital to PLN 0.9 million by creating 800 new shares with a par value of PLN 500.00 each. The increase of JSW Ochrona’s share capital was covered with a cash contribution – JSW SiG subscribed for 760 shares for the total amount of PLN 380,000.00, while JSK subscribed for 40 shares in the total amount of PLN 20,000.00. The increase of the JSW Ochrona share capital was registered in the National Court Register on 1 August 2018.
On 10 September 2018, the Shareholder Meeting of JSW Ochrona adopted a resolution to increase the company’s share capital to PLN 1.4 million by creating 900 new shares with a par value of PLN 500.00 each. The increase of JSW Ochrona’s share capital was covered by a cash contribution – JSW SiG subscribed for 855 shares for the total amount of PLN 427,500.00 while JSK subscribed for 45 shares in the total amount of PLN 22,500.00. The share capital increase was registered in the National Court Register on 19 October 2018.
On 29 December 2017, the Extraordinary Shareholder Meeting of JSK adopted a resolution to increase JSK’s share capital by PLN 20.4 million by issuing 40,710 new shares with a par value of PLN 500.00 each, through an in-kind contribution of JSW S.A.’s assets in the total market amount of PLN 20.4 million. The share subscription statement was filed on 29 December 2017. JSW subscribed for all the new shares. On the same date, an agreement was signed on transferring the rights to the assets forming the contribution-in-kind; however, the rights were transferred on 1 January 2018. The share capital increase was registered in the National Court Register on 6 April 2018.
On 26 February 2018, the Extraordinary Shareholder Meeting of Zakład Przewozów i Spedycji SPEDKOKS Sp. z o.o. adopted a resolution to increase the company’s share capital by PLN 760,000.00 through JSW’s subscription for 1,520 new shares with a par value of PLN 500.00 each. The increased share capital was covered by a contribution-in-kind of JSW’s assets (KWK Budryk and the Production Support Unit). The declaration of subscribing for shares was submitted on 26 February 2018. The capital increase was registered in the National Court Register on 29 March 2018.
On 30 April 2018 a change of name was registered in the National Court Register for the company from Zakład Przewozów i Spedycji Spedkoks Sp. z o.o. to JSW Logistics Sp. z o.o. The company’s address and registered office were also changed to Katowice, ul. Paderewskiego 41.
On 10 April 2018 the Extraordinary Shareholder Meeting of JSW Innowacje adopted a resolution to consent to the establishment of Hawk-e Sp. z o.o. and at the same time to the subscription for 40,000 shares with a nominal value of PLN 50.00 each, with a total value of PLN 2.0 million constituting 100% of the share capital of the company being established. This company is to become the largest service provider in Poland in the usage of drones for commercial purposes. The shares subscribed for were covered by a cash contribution. The company was registered by the National Court Register on 26 April 2018.
Advicom Sp. z o.o. signed a share purchase agreement with COIG S.A to purchase 5,105 shares in Advicom held by COIG S.A., which represented 24.94% of all the shares, for the total amount of PLN 9.9 million for retirement. The shares were transferred and retired at the moment the funds were booked on COIG S.A.’s bank account, i.e. on 2 July 2018. After this transaction was finalized, JSW S.A. now holds 100% of Advicom’s shares. This transaction with non-controlling interest resulted in a cash expenditure of PLN 9.9 million presented in the consolidated statement of cash flows as transactions with non-controlling interest (purchase of shares from non-controlling interest). A detailed description of the transaction is included in Note 10.3.
On 3 August 2018 Advicom’s Extraordinary Shareholder Meeting adopted a resolution to increase share capital to PLN 15.2 million, i.e. by PLN 5.0 million by creating 10,000 new shares with a par value of PLN 500.00 each. The shares were fully covered by cash and taken up in their entirety by JSW for the amount of PLN 20.0 million. The share premium account of PLN 15.0 million was allocated to Advicom’s supplementary capital. The share capital increase was registered in the National Court Register on 23 October 2018. The transaction has no effect on the consolidated financial statements of the Jastrzębska Spółka Węglowa S.A. Group.
On 31 October 2018, the Shareholder Meeting of Advicom adopted a resolution to change its name to JSW IT Systems Sp. z o.o. and a resolution to change the nominal value of shares from PLN 500.00 to PLN 1,000.00 per share. These changes were registered in the National Court Register on 2 January 2019.
On 19 June 2018 JSW signed a share purchase agreement with JSW KOKS S.A. to purchase 548,461 shares of JSW KOKS (treasury shares) representing 0.5517% of the company’s capital, for the total amount of PLN 7.8 million, i.e. PLN 14.29 per share. According to the terms and conditions of the agreement, the title to the shares purchased from JSW KOKS was transferred to JSW on the date the sales price was credited to JSW KOKS’ bank account, i.e. on 19 July 2018. After the finalization date of this transaction, JSW S.A. now holds 96.28% of JSW KOKS’ shares. The impact of these transactions on the consolidated financial statements of the Jastrzębska Spółka Węglowa S.A. Group is discussed in Note 10.3.
The structure of the Group (chart) including companies consolidated as at 31 December 2018 is presented in Section 2.1. Management Board Report on the activity of Jastrzębska Spółka Węglowa S.A. and the Jastrzębska Spółka Węglowa S.A. Group for the financial year ended 31 December 2018.
The table below presents details on the Group’s subsidiaries with non-controlling interest:
Company name
Headquarters
Percentage stake
held by the GroupProfit/(loss) allocated to non-controlling interest
for the yearAccumulated value
of non-controlling interest
31.12.2018
31.12.2017
2018
2017
31.12.2018
31.12.2017
JZR
Jastrzębie-Zdrój
58.61%
62.55%
11.5
6.1
299.4
166.3
JSW KOKS
Zabrze
96.28%
95.72%
10.8
(3.1)
63.2
52.8
Other subsidiaries with non-controlling interest
–
Note 1.2.
Note 1.2.
1.4
1.4
1.4
13.3
TOTAL
–
–
–
23.7
4.4
364.0
232.4
The table below contains selected financial data of the Group’s key entities holding non-controlling interest
Item |
JZR | JSW KOKS | ||
2018 | 2017 | 2018 | 2017 | |
STATEMENT OF FINANCIAL POSITION | ||||
Assets | 857.1 | 544.8 | 2,500.2 | 2,283.7 |
Equity | 723.3 | 444.0 | 1,698.8 | 1,405.3 |
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME | ||||
Sales revenues | 213.6 | 158.9 | 4,346.1 | 3,651.3 |
Net profit | 28.5 | 18.8 | 288.0 | (83.1) |