DUVEL Vedett Maredsous Chouffe Liefmans Bel Pils OMMEGANG BERNARD
ANNUAL REPORT
Key to formulae (15) (14) (13) (12) (11) (10) (9) (8) (7) (6) (5) (4) (3) (2) (1) Weighted Average Cost ofCapital Return onshareholders’Return funds Operating cash flow (EBITDA) Cost ofshareholders’ equity Price-earnings to growth Price-earnings Economic Value Added Net financialcreditors Cost funds ofexternal Working capital Current ratio Net assets Debt ratioDebt P/CF ratio Cash flow P/E ratio RONA P/B Price-bookvalue ratio is the share price at 31st December dividedby ratioistheshare theshareholders’equity at31stDecember price Price-bookvalue pershare onnetassets=EBIT/Net Return Consolidated netprofit tax+depreciation after +provisions for liabilities andcharges +write-downs Price-cash flowDecember divided ratioistheshareby thecashflow at31st pershare price Price-cash Price-earnings ratio is the share price at 31st December divided by the ordinary netprofit pershare dividedby ratioistheshare the ordinary at31stDecember price Price-earnings External capital/total assets(balancesheettotal) External creditorsCurrent assets/short-term investments Shareholders’ +interest-bearing equity financialcreditors -cashatbank andinhand-short-term year)*cost ofcapitalornetassetsprevious financial -year *(Rona Wacc) offinancial offinancial year)*returnCapital oncapital- employedCapital employed (start (start creditors <1year -accruedcharges anddeferred incomeliabilities) Current assets(exclusive investments andcashatbankinhand)-non-financial ofshort-term Total interest-bearing investments financialcreditors -cash atbankandinhand-short-term This is the price to earnings ratio dividedby toThis theaverage earnings istheprice growth rate oftheconsolidated netprofit. of goodwill Operating profit +depreciation +depreciation +provisions for liabilitiesandcharges +write-downs Consolidated netprofit tax/shareholders’ after atendofprevious financial equity year Cost ofshareholders’ funds +costofexternal equity Average interest rate payable onloans -taxsaving Interest payable on10-year OLO premium risk *Betacoefficient (31/12/08)+market 2008 2007 2006 2005 2004 € € € € € IFRS IFRS IFRS IFRS IFRS
Consolidated k e y f i g u r e s
Revenu 101,008,616 87,451,728 74,597,244 66,311,997 61,299,052 Result from operating activities 18,990,183 17,532,958 16,272,418 14,511,471 13,181,898 Finance expense -907,998 -331,162 -20,908 173,897 -70,442 Profit before income taxes and share of profit of equity accounted investees 18,082,185 17,201,797 16,251,510 14,685,368 13,111,456 Profit before income taxes 18,082,185 17,215,364 16,251,510 14,685,368 13,111,456 Current income tax expense 5,133,584 5,261,535 4,567,111 4,733,308 3,981,488 Deferred taxes 770,866 126,289 992,044 248,949 717,292 Share of profit of equity accounted investees 0 13,567 0 0 0
Consolidated key figures Profit for the period 12,177,735 11,827,540 10,692,355 9,703,111 8,412,676 Profit for the period attributable to equity holders of the Company 12,162,788 11,761,009 10,682,462 9,703,111 8,412,676 Profit for the period attributable to minority interest 14,946 66,531 9,893 0 0
Total assets (Balance sheet total) 167,472,772 154,542,668 134,604,910 111,264,269 102,856,474 Total equity attributable to equity holders of the Company 97,024,482 90,056,664 81,733,312 73,718,936 66,521,692 Net financial liabilities (1) -5,523,839 -6,532,110 -7,974,538 -12,347,858 -6,654,630 Net Assets (2) 91,500,643 83,524,554 73,758,774 61,371,078 59,867,062 Property, plant and equipment 100,541,264 92,286,896 80,124,182 63,510,060 61,104,168 Depreciation, amortization, impairment, provision 11,279,733 9,236,903 7,544,769 7,203,353 5,643,738
Working capital (3) 17,973,773 14,464,073 15,690,995 13,825,398 13,804,105
Cash flow from operating activities(4) 30,865,542 26,176,416 24,340,017 21,864,384 19,587,582 Impairment/provision 595,626 -593,445 522,830 149,560 761,946 Cashflow (5) 24,053,093 20,470,998 18,759,954 17,056,024 14,818,360 Employee benefits 16,708,290 14,856,076 13,085,361 11,083,459 10,497,816 Number of employees 559 515 468 412 365
Ra t i o s
Liquidity / Current Ratio (6) 2.61 2.71 3.04 3.29 3.18 Solvency / Debt ratio (7) 0.42 0.42 0.39 0.27 0.29 Return on shareholders’ funds (8) 13.52% 14.47% 14.50% 14.59% 12.86% RONA (9) 20.75% 20.99% 22.06% 23.65% 22.02% WACC (10) 7.31% 6.85% 6.08% 5.85% 6.59%
(11) EVA 11,229,168 10,430,510 9,808,124 10,653,616 8,753,841 3 Consolidated k e y f i g u r e s p e r s h a r e | Number of shares issued as at 31/12 5,366,030 5,366,030 5,362,030 5,353,510 5,341,390 Average number of shares in issued 5,305,966 5,327,064 5,318,440 5,296,334 5,302,391 Weighted average number of ordinary shares (diluted) 5,308,666 5,330,855 5,325,155 5,360,828 5,320,255 Own shares 81,163 34,966 34,966 45,266 47,120 Result from operating activities 3.58 3.29 3.06 2.74 2.49 Profit before income taxes and share of profit of equity accounted investees 3.41 3.23 3.06 2.77 2.47 Earnings per share 2.30 2.22 2.01 1.83 1.59
Diluted earnings per share 2.29 2.22 2.01 1.81 1.58 Moortgat Duvel
Cash flow 4.53 3.84 3.53 3.22 2.79 2008 Total equity attributable to equity holders of the Company 18.08 16.78 15.24 13.77 12.45 Gross dividend 1.00 0.80 0.72 0.65 0.58 Net Dividend 0.75 0.60 0.54 0.49 0.44 Closing price at end of December 32.99 48.74 38.53 32.31 25.85
St o c k m a r k e t r a t i o s annual report
Dividend 5,240,697 4,264,851 3,835,486 3,450,359 3,070,677 Payout ratio (% 43.04% 36.06% 35.87% 35.56% 36.50% Dividend yield 2.27% 1.23% 1.40% 1.51% 1.68% P/E ratio (12) 14.38 21.97 19.19 17.85 16.35 P/CF ratio (13) 7.28 12.68 10.92 10.03 9.25 P/B (14) 1.82 2.90 2.53 2.35 2.08 Consolidated net profit growth 2.96% 10.62% 10.20% 15.34% 0.00% Average growth in consolidated net profit over 3 years 7.92% 12.05% 12.77% 15.34% 0.00% PE/G ratio (15) 1.81 1.82 1.50 1.16 0.00
Contents Financial Section Governance Corporate andshareholders forInformation investors Policy Aspects bythe board ofdirectors Report Strategic Objectives–Mission DuvelMoortgat Structure DuvelMoortgat Profile oftheA word CEO Chairman’s statement 88 74 66 60 28 24 18 12 10 06 Duvel Moortgat Profile 5 annual report 2008 Duvel Moortgat | Chairman’s statement
Mi c h e l Va n He m e l e , v o o r Ru b u s n v | Ch a i r m a n o f t h e Bo a r d o f Di r e c t o r s
Dear shareholder, emphasis was put mainly on the development of the distribution infrastructure in the export The second half of 2008 was a difficult period for markets, in the previous year, specific marketing many companies. That is why I am greatly pleased campaigns were developed, not only for Duvel, that once again, Duvel Moortgat is able to present but for the other brands as well. Our approach has excellent figures in this annual report. Nearly all thus moved from a monobrand to a multibrand brands realised a rise in turnover. Only Bel Pils approach. performed less well than in 2007. In doing so, it followed the downward movement of Belgian This interest from abroad was one of the reasons lager consumption. that Duvel Moortgat was nominated for the prestigious Flemish ‘Company of the Year 2008’ The most significant finding, however, is that award. It is my pleasure to quote the jury, who the group’s speciality beers are increasingly referred to us as ‘stars in entrepreneurship and appreciated and consumed, both in Belgium innovation, strategy and drive, internationalisation and abroad. I use the term ‘specialty beers’ and solid management’. intentionally, since for a long time now, it does not only concern Duvel. For example, in the An important theme throughout 2008 was Netherlands and France, Vedett and Chouffe are the expansion of our brand portfolio, with the very popular. Great Britain, on the other hand, takeover of the Brouwerij Liefmans’ activities as looks very promising for Vedett, while in the the main factor. At the moment, strong efforts United States, the interest in Belgian beers in are put into the redevelopment of the brand general keeps on growing. and the client portfolio. Vedett Extra White, on the other hand, proves that a new white beer is In 2008, Duvel Moortgat continued its able to achieve success, as long as it has the right internationalisation. While in the past, the personality and image, and meets the consumer’s Chairman’s statement
needs. For example, Vedett Extra White is enthusiastically committed themselves to their remarkably popular in Japan. company. I would like to seize this opportunity to sincerely congratulate them. In 2008, we continued to develop the green and sustainable elements in our company. In doing Thanks to all of these efforts, 2008 has been a so, we are the only Belgian brewery that runs on good year. This enables the Board of Directors to green energy exclusively. This energy comes from pay out a gross dividend to the amount of € 1 per a French hydroelectric power station and partly share for 2008, which signifies a 25% increase. This 7 from our own solar energy station. Our sustainable is our way of thanking you, our shareholders, for approach translated itself into different fields, but the trust you put in our company. | two examples are notably eye-catching. First of all, the new brewery hall in Puurs, put into use in early 2008. It was designed with a high respect for the environment and the residential areas surrounding the brewery. A second initiative – on a smaller scale but certainly equally interesting – Duvel Moortgat Duvel is the so-called Bicycle Plan. The employees that 2008 make the commitment to leave their cars at home as much as possible, receive a personalised Duvel bicycle.
This brings me to the people behind Duvel annual report Moortgat’s success. Just as in previous years, in the last year our employees and members of the Michel Van Hemele, for Rubus NV management team have once again fully and Chairman of the Board of Directors Duvel Duvel is a high fermentation luxury beer with an alcohol content of 8.5% vol.
Brewed using malted barley and hops, it undergoes secondary fermentation in the bottle. Duvel is the Group’s best-known brand and is the international reference 9
for the ‘strong blond’ segment. |
The Duvel turnover rose globally by 8%. In Belgium, market leader Duvel did better than it did in 2007. Duvel further expanded its visibility and consolidated its brand image. Despite a declining market, the beer succeeded in consolidating its Duvel Moortgat Duvel share of the market. This can mainly be attributed to the fact that Duvel itself is a 2008 successful segment, and that it isn’t taken up in a larger group of beers. annual report
For a few years now, the focus on other promising markets is intensified. In these markets as well, Duvel succeeded in realising a nice progress. Ten interesting and successful years
Mi c h e l Mo o r t g a t | CEO Du v e l Mo o r t g a t
Ten years ago, in 1999, Duvel Moortgat wrote the This mission was the result of two major findings. following in its mission statement: On the one hand, Duvel Moortgat depended heavily on the success of its showpiece Duvel. On the other hand, over 85% of our turnover originated from Belgium. A setback of one or another of the two could heavily tax the company. That is why we consciously decided at the time Driven by quality, Duvel Moortgat to both expand the beer supply and to launch the geographic expansion. However, from the is determined to occupy a leading start this had to take place within a well-defined framework: the beers should be of immaculate position as a niche player in the quality all the time, with a strong brand name and an added value. Moreover, they should have the profitable segment of specialty beers potential to be a top player within their segment and market. and premium brands, For ten years, we have consequently worked on both in Belgium and in its priority this. In addition to Belgium, we have chosen four priority export markets: the Netherlands, France, export markets. Great Britain and the United States of America. Profile Duvel Moortgat
Ten interesting and successful years
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All of them are markets where beer consumption Extra White, and recently the Liefmans beers | is either stable or slightly decreasing, but where from Oudenaarde. This strategy has served us
the people are trading in quantity for quality. Thus, well. Since its stock market introduction in 1999, they are markets where we – as a niche player Duvel Moortgat’s turnover has risen by 168%. devoted to quality – are able to provide an added This is a good reason to put this unique range of value. In each of these four markets we have set specialty beers – which is a guaranty for quality, up our own commercial and logistics structures. expertise and innovation –in the spotlight as a Duvel Moortgat Duvel And successfully so, since today the foreign central theme in this annual report. 2008 countries represent 43% of the consolidated group turnover. Also, in over 40 other countries, The past ten years have been extraordinary we have developed the presence of our interesting. And successful. Thanks to our specialty beers. Our dependence on the Belgian wonderful beers, but especially thanks to the
market remains important, but it has decreased motivated and driven commitment of our annual report substantially. employees. I wish to sincerely thank them for this. During the same period, we have also selectively extended our brand portfolio with beers that meet our qualitative and quantitative criteria. The Bernard beers in the Czech Republic, the Ommegang beers in the United States, the Chouffe beers, Vedett Extra Blond and Vedett Michel Moortgat | CEO Duvel Moortgat Duvel Moortgat Profile
As an independent producer of specialty beers, Duvel Moortgat, in the last 125 years, has grown into being an international player, producing beers that are appreciated and respected all over the world.
Who we are
Duvel Moortgat is an independent brewery that has been producing specialty beers since 1871. The Group has become an international player with production units in Belgium, the United States and the Czech Republic and additionally, branches of its own in the Netherlands, France, the United Kingdom and China. The beers have acquired national and international recognition, and occupy a confirmed top position in the segment of strong blond ales.
Duvel Moortgat shares have been listed on the Euronext Brussels stock exchange since early June 1999. Since 1 March 2005, Duvel Moortgat is also listed on the Bel Small Index.
What we do
Duvel Moortgat brews an annual total of almost 600,000 hl of specialty beers. The Group has a portfolio of some ten beer brands of which, next to Duvel - the strong blond specialty beer - Chouffe, Vedett, Maredsous, Liefmans, Ommegang and Bernard are the core brands. 43% of the Group’s turnover comes from export or sales of beers produced in the foreign subsidiaries. Duvel is exported to over 50 countries all around the world. The main export markets are the United States, the Netherlands, France and the United Kingdom. Profiel Duvel Moortgat
The key word: Quality
Quality has been the common feature throughout Duvel Moortgat’s existence: from the production planning and purchase of raw materials over the brewing process to the delivery to the on- and off-trade sector, the commitment to quality persists. Internal goals and external standards like HACCP provide a reference frame to permanently maintaining these high standards and exceeding them wherever possible. This way, Duvel Moortgat is constantly pushing itself in order to provide the consumer with premium quality beers, thus ensuring that every consumer can enjoy his or her beer in perfect circumstances, always and everywhere.
Long before the concept of ‘total quality insurance’ came into being, Jan-Leonard Moortgat developed a quality reference in the brewery sector, through the concept and realisation of his beers. His passion 13 proved to be hereditary and, in combination with innovation and entrepreneurship, lead to a number of beautiful and successful beers, of which not only Duvel, but also Chouffe, Vedett, Maredsous and the other | Duvel Moortgat brands are the living proof.
The Duvel beer has been a characteristic example of the Duvel Moortgat’s passionate approach for more than eight decades: foamy, powerful and rich in taste. Today, the strong Duvel position is joined by flourishing new brands, thus guaranteeing that this generation as well as the next ones will carry on the tradition and passion. Duvel Moortgat Duvel 2008 annual report
Profile Duvel Moortgat
The group’s main brands
Duvel is a high fermentation luxury beer with and Framboos (4.5% alc. vol.), Gouden Band (8% alc. an alcohol content of 8.5% vol. Brewed using vol.) that is brewed using special malts, and Oud malted barley and hops, it undergoes secondary Bruin (5% alc. vol.) that equally obtains its typical fermentation in the bottle. Duvel is the Group’s taste and colour from the special malts used. best-known brand and is the international reference for the ‘strong blond’ segment. Bel Pils is a 5% vol. low fermentation beer, bottled or cask conditioned after a long period of Maredsous is the brand name of Duvel maturation. The aromatic hops used for this beer Moortgat’s abbey beers: two gold coloured beers give it its characteristic taste and aroma. Bel Pils is with respective alcohol contents of 6% and 8% vol., the Group’s stylish luxury Pilsner and one of the plus an 8% vol. dark version. The Maredsous abbey on-trade markets most typical Pilsner beers. beers differentiate themselves from competing brands by their specific secondary fermentation in The Brasserie d’Achouffe’s Chouffe beers are the bottle. unpasteurized beers, to which nothing is added nor extracted during the production process. They’re Vedett is available in two varieties. Vedett Extra bottled in characteristic 75 and 150 cl bottles. Blond is a low fermentation blond premium beer The best-known goblin beers are La Chouffe, a with an alcohol content of 5.2% vol. Although it gold coloured beer with an alcohol content of 8% has been brewed since 1945 (originally under the vol. that undergoes secondary fermentation in the name ‘Export’ and as ‘Vedett’ since 1965), it wasn’t bottle or the barrel, the dark version Mc Chouffe 15 until recently that it was given a new impulse. of 8.5% vol, and the season beer N’ice Chouffe of On 1 July 2008, its sister beer Vedett Extra White was 10% alc. vol. | launched, containing a 4.7% alc. vol. This authentic
white beer is brewed using exquisite raw materials Bernard is the umbrella name for a range of and has a double fermentation, both in the bottle premium Pilsner beers (Bernard Light, Bernard and in the barrel. Pilsner, Bernard Dark and Bernard Special), brewed using a traditional and natural method. Thanks Liefmans is the brand name for the beers of the to these beers, the Bernard brewery is nationally Duvel Moortgat Duvel Liefmans brewery in Oudenaarde, which all have a renowned as a niche player in the premium beers 2008 typical and unique taste: the fruity Kriek (6% alc. vol.) segment of the Czech Republic.
Three Philosophers (9.8% alc. vol.), Ommegang (8.5% alc. vol.), Hennepin (7.7% alc. vol.), annual report Rare Vos (6.5% alc. vol.) and Ommegang Witte (5.1% alc. vol.) are the most important beers brewed by the Group’s American production unit, the Ommegang Brewery. With their specifically Belgian character, and together with Duvel, they respond to the American interest in specialty beers.. Maredsous Maredsous is the authentic beer of the Maredsous Benedictine abbey in
Belgium. The abbey is situated in the Belgian Ardennes, south of Namur, next to the picturesque village of Denée. Maredsous exists in three varieties, each of them guaranteeing its own, unique experience: Maredsous Blond, Brune and Triple.
17
The Maredsous abbey beers have done well. Turnover rose by 18.3 %. The | international repositioning, putting the emphasis on the close connection to the Benedictine abbey by the same name, has been very well received by the customers. The fact that the Maredsous abbey is a popular tourist attraction, adds Duvel Moortgat Duvel 2008 to the appeal in Belgium, the Netherlands and France. In France, the Maredsous beers are available both in the on- and off-trade sector, where there is still a lot of
growth potential. annual report
In other countries as well, Maredsous realised a nice progression. Duvel Moortgat Structure
The Duvel Moortgat structure, with a wide range of subsidiaries, joint ventures and holding companies(*) reflect the group’s growing international activities.
The operating activities of the Duvel Moortgat Group are organised in a business unit: ‘production and sales of drinks’. Additionally, there are a number of ‘other activities’.
Th e ‘p r o d u c t i o n a n d s a l e s o f d r i n k s ’ b u s i n e s s u n i t i s responsible f o r t h e b r e w i n g , b o t t l i n g , c onditioning a n d t h e s a l e s o f t h e v a r i o u s d r i n k s . Th e b u s i n e s s u n i t c o o r d i n a t e s t h e s e a c t i v i t i e s i n t h e f o l l o w i n g subsidiaries , j o i n t v e n t u r e s a n d investments :
Duvel Moortgat nv brews, bottles and sells the company’s own brands (Duvel, Bel Pils, Vedett and Liefmans), plus the Maredsous abbey beers brewed under licence from the Fromagerie et Brasserie de Maredsous.
Brasseried’Achouffe nv brews, bottles and sells various specialty beers, among which the blond La Chouffe and the dark Mc Chouffe in the typical 75cl-bottle are the most well-known. The Ardennes brewery was purchased by Duvel Moortgat in September 2006.
Brouwerij Steendonk nv is a joint venture between Duvel Moortgat and the Palm Breweries. In the spring of 2008, both breweries decided to end the production and sale of the Steendonk white beer as from 1 July 2008. Since then, each of the breweries has been commercializing their own white beer. In the case of Duvel Moortgat, this is Vedett Extra Blond.
Rodinny Pivovar Bernard as in the Czech Republic bottles and sells a broad range of premium beers marketed under the ‘Bernard’ brand.
Sladovna Bernard as is the Bernard Brewery’s malting unit.
Brouwerij Belâme Ltd (Brewery Ommegang) brews and bottles, amongst others, Ommegang Abbey, Ommegang Witte, Hennepin, Rare Vos and Three Philosophers in the United States.
Moortgat Horeca Services nv is Duvel Moortgat’s central on-trade distribution point. It was formed in 1999 from the merger of the Group’s regional beer dealers in Antwerp and Brussels, plus beer dealer De Cuyper nv. Structuur Duvel Moortgat
The LFB Group runs a chain of French theme cafés positioned as ‘beer villages’, with outlets in Strasbourg, Tours, Clermont-Ferrand, Grenoble, Nancy and Lyon.
Eura Drinks nv imports and organises the distribution of waters and soft drinks.
Duvel Moortgat is a participant in the European Economic Interest Grouping “Beer & Selected Beverages” (BSB) EESV. BSB is a logistical distribution platform for specialty beers in The Netherlands.
Duvel Moortgat France sarl is the Group’s sales organisation in France. It is directly responsible for the sales of the beers to the on- and off-trade sectors.
Duvel Moorgat USA Ltd is the Group’s sales and distribution organisation in the United States. It is present in 45 states.
Groupement des BièresSpeciales (GBS) GEIE, also a ‘European Economic Interest Grouping’, is the distribution platform for specialty beers in France.
Belga Bar (UK) Ltd takes care of the exploitation of Bar Music Hall in London.
Force de Vente Service (FVS) is a joint venture aiming specifically at the distribution of specialty beers 19 through supermarkets in France. At the end of 2006, the partners decided by mutual agreement to dissolve the joint venture. On 25 November 2008, the liquidation was finalized. |
Duvel Moortgat UK Ltd is the Group’s sales organisation in the United Kingdom. It is responsible for the sales of the beers to the on- and off-trade sectors.
Duvel Moortgat Shanghai Ltd is responsible for the import, distribution and sales of the Group’s brands in China. Duvel Moortgat Duvel 2008 Duvel Moortgat Hong Kong Ltd is the Group’s sales and distribution organisation in Asia and the South West Pacific.
Freya’s Deli Fruit nv no longer peforms any activities. In the course of 2008, a final settlement was made
concerning the royalties from Konings nv. annual report Th e b u s i n e s s u n i t ‘o t h e r a c t i v i t i e s ’ i n c l u d e s a l l p r o p e r t y i n t e r e s t s a n d f i n a n c i a l s e r v i c e s o f t h e Du v e l Mo o r t g a t Gr o u p .
Moortgat Immo Services (MIS) nv has been the Group’s property company since 2002. It includes the horeca outlets that used to be spread over various companies.
Parallel nv owns real estate for on-trade use on the Waalse Kaai in Antwerp.
Espace Belge GEIE is a European Economic Interest Grouping that owns the ‘Bouillon Racine’ building in Paris. Duvel Moortgat holds a 23.4% share in Espace Belge.
LDV Immo nv owns the real estate for on-trade use at the Elisabeth avenue in Berchem (Antwerp).
Moortgat Financial Services (MFS) nv provides financial support to the horeca outlets. MFS was converted into a financial institution in May 1999, in conformity with the Act of 22 March 1993. Its outstanding loans portfolio stood at € 2,362,000 at the end of 2008.
(*) Mo r e c o m p a n y d e t a i l s c a n b e f o u n d o n p a g e 154 Structuur Duvel Moortgat
Organization chart
Brewery Duvel Moortgat nv
Mo o r t g a t Ho r e c a Se r v i c e s n v Br o u w e r i j St e e n d o n k n v | 50 % 2 8 Mo o r t g a t Imm o Se r v i c e s n v | 100 % 29 | 100 %
Mo o r t g a t Fi n a n c i a l Se r v i c e s n v Ro d i n n ý Pi v o v a r Be r n a r d a s | 50 % 3 9 DRC s a | 100 % 20 Pa r a l l e l | 100 % 30 | 100 %
Sl a d o v n a Be r n a r d a s | 50 % 4 LFB Gr o u p | 50 % LFB Dé v e l o p p e m e n t s a | 100 % 21 L.D.V. Imm o | 100 % 31
Br e w e r y Omm e g a n g l t d | 100 % 5 LFB Ex p a n s i o n s a s | 83,48 % 22 Es p a c e Be l g e à Pa r i s g e i e | 23,40 % 32
Fr e y a ’s De l i Fr u i t n v | 70 % 6 Eu r a Dr i n k s n v | 100 % 10 LFB St r a s b o u r g | 90 % 23
Br a s s e r i e d’Ac h o u f f e s a | 100 % 7 BSB e e s v | 10,37 % 11 LFB Cl e r m o n t -Fe r r a n d | 90 % 24 21
Du v e l Mo o r t g a t Fr a n c e s a r l | 100 % 12 LFB To u r s | 90 % 25 |
Du v e l Mo o r t g a t USA, Lt d | 100 % 13 LFB Gr e n o b l e | 90 % 26
Gr o u p e m e n t Bi è r e s Sp é c i a l e s geie 14 LFB Na n c y | 90 % 27 | 33 % Moortgat Duvel 2008
Be l g a Ba r (UK) Lt d | 100 % 15 LFB Ly o n | 90 % 28 annual report FVS | v e r e f f e n d 16
Du v e l Mo o r t g a t UK Lt d | 100 % 17
Du v e l Mo o r t g a t Ho n g Ko n g Lt d Du v e l Mo o r t g a t Sh a n g a i Lt d 18 19 | 100 % | 100 % Vedett Vedett is available in two varieties. Vedett Extra Blond is a low fermentation blond premium beer with an alcohol content of 5.2% vol. Although it has been brewed 23
since 1945 (originally under the name ‘Export’ and as ‘Vedett’ since 1965), it wasn’t | until recently that it was given a new impulse. On 1 July 2008, its sister beer Vedett
Extra White was launched, with an alcohol content of 4.7% alc. vol. This launch, combined with the launch of a canned version of Vedett Extra White is creating a Duvel Moortgat Duvel positive dynamic. 2008
The continuous strong growth of Vedett proves once again that the brand – annual report thanks to or despite its rebellious character – is becoming a well-established brand.
Turnover of Vedett Extra Blond rose by 21.4% in 2008. Strategic objectives The Duvel Moortgat mission
Driven by quality, Duvel Moortgat is determined to occupy a leading position as a niche player in the profitable segment of specialty beers and premium brands, both in Belgium and in its priority export markets.
Increase Belgian market leadership in specialty beers
Duvel Moortgat owns a broad range of quality beers and will reinforce its position as a market leader in the segment of specialty beers even further by making the right investments and marketing efforts.
Further reinforce the ‘Duvel’ brand name by paying attention to an extension of the brand portfolio
With its particularly powerful brand name, Duvel remains the flagship of the Group’s expansion in Belgium and its export markets. The visibility of the brand will be further increased. In addition to its flagship Duvel, Duvel Moortgat develops other core brands: Chouffe, Vedett, Maredsous, Liefmans, Ommegang and Bernard.
International Expansion
The United States, the Netherlands, France, and the United Kingdom are the Group’s priority export markets, while – in cooperation with local importers – the necessary support is also being given to the other countries to fully expand their potential.
The Bernard Brewery brands will be further developed both in the Czech Republic and across its borders.
Local market requirements are being satisfied optimally in the largest export countries, using local structures and people and a dynamic marketing policy. Strategic objectives mission
Striving for perfection
Quality is the Duvel Moortgat’s Group’s greatest asset and it should remain so in the future. The Group is continuously striving for perfection, specifically in four strategic fields:
- Well-trained and motivated employees who carry out their work with a great sense of responsibility - A well thought-out purchasing policy that guarantees the superior quality of all beers - Using the most innovative technologies in order to ensure the highest product quality and to enable the Group to respond flexibly to the commercial needs of the home and foreign markets. - Logistical services 25
Expansion through a scrupulous takeover policy |
Duvel Moortgat remains interested in acquiring additional distribution channels and production companies, on the condition that they are profitable, offer high quality and are strategically complementary with the rest of the Group. Duvel Moortgat Duvel 2008 Corporate governance for the benefit of the stakeholders
Proper management is a basic requirement to fully exploit the financial resources that the shareholders
provide to the company, and benefits all stakeholders. The key concepts here are ‘profitability’, ‘cost control’ annual report and ‘return on investment’. Chouffe The Chouffe beers of the Brasserie d’Achouffe, situated in the Belgian Ardennes, have been part of the Duvel Moortgat nv group for two years. Sales of the Chouffe beers increased further by 16.3% in 2008. Given the strategic importance of the brand, the commercial efforts were further increased in the course of the year, resulting in a strong growth. The best-known goblin beers are La Chouffe, a gold coloured beer with an alcohol content of 8% vol. that undergoes secondary fermentation in the bottle or the barrel, the dark version Mc Chouffe of 8.5% vol, and the season beer N’ice Chouffe of 10% alc. vol.
The extraordinary character of the beers is manifested in a number of special 27
editions, which distinguish themselves by their taste and seasonal character. The | winter beer N’ice Chouffe is a dark ‘winter-warming’ beer, available from 1 December as long as stock lasts. It appeals to the close connection that exists between the
Chouffe beers and the Belgian Ardennes, a tourist region attracting a lot of visitors. Duvel Moortgat Duvel
Chouffe Bok is launched in the October-November months. Its special method of 2008 preparation is mainly focused towards the Dutch market. Houblon Chouffe, with
its typical bitter taste – brewed based on three different types of hops – is available annual report in the European countries from now on. Before, it was only available in the United
States. Report by The Board of Directors
2008 once again has been a good year for Duvel Moortgat, despite the rise in prices of raw materials and energy, and the worsened economic conditions in the last quarter. In order to continue its growth, Duvel Moortgat once again invested significantly in its production capacity and in the launch of some new beers. Nearly all brands have seen a further rise in turnover on most markets.
1. 2008: the most important facts.
Go o d f i g u r e s d e s p i t e d i f f i c u l t m a r k e t c o n d i t i o n s
The 2008 economic climate was far from favourable. Although the impact of the economic crisis on sales was limited, the prices of energy and raw materials increased significantly. At the end of 2008, the prices of the major raw materials were more than twice as high compared to 2006. Duvel Moortgat managed to partly charge the higher production cost to the market. The prices of all beers were adjusted only once, in the spring of 2008.
The consolidated turnover rose by 15.5% which means an 80% increase during the last five years. Since its stock market introduction in 1999, Duvel Moortgat’s consolidated turnover has risen by 168%. This strong growth can be attributed to a strategy the group has consistently maintained, and which is based on two pillars: a controlled expansion of the brands on the existing markets, combined with geographical expansion.
In 2008, Duvel consolidated its position as strongest brand of the group, with an 8% global rise in turnover.
Re c o n s t r u c t i o n l i e f m a n s w a r m l y w e l c o m e d
On 24 June, Duvel Moortgat took over the activities of the bankrupt companies Brouwerij Liefmans n.v. and Liefmans Breweries n.v.. In doing so, it acquired a large part of the assets of the bankrupt companies, among Report by The Board of Directors
which the entire machinery, all brands and methods of preparation. Earlier on, Duvel Moortgat had already taken on the temporary exploitation of the site of the Brouwerij Liefmans in Oudenaarde for the duration of two months.
In an initial phase, all attention is focused on the products of the Brouwerij Liefmans n.v.. The strong brand, that radiates quality and authenticity, is gradually being rebuilt, and successfully so. The takeover by Duvel Moortgat, and the continuity that is created by it, has been positively welcomed by the Liefmans’ clients and distribution channels.
Ex p a n s i o n o f t h e b r a n d p o r t f o l i o
- As mentioned above, the brand portfolio was extended with Liefmans.
- On 1 July, Vedett Extra White was launched, the sister beer of Vedett Extra Blond. This authentic white beer is brewed using the most exquisite raw materials such as coriander and orange zest, and has a double fermentation, both in the bottle and in the barrel.
- The Maredsous beers were successfully repositioned internationally, from a general abbey beer to a beer that is closely connected to the Benedictine abbey by the same name. This happened in close 29 consultation with the monks. The labelling, amongst others, was adjusted accordingly. | - Until recently, Houblon Chouffe was only being put on the market in the United States, since the
consumers there greatly appreciate its strong hops taste. Meanwhile, it has also been made available in the other European countries.
Fo r e i g n s h a r e o f g r o u p t u r n o v e r k e e p s i n c r e a s i n g Duvel Moortgat Duvel 2008 In 2008, all of Duvel Moortgat’s activities abroad gained further importance, which is in line with the aspirations of the Board of Directors to expand internationally. This growth is the result of the consequently maintained efforts made on these markets, in combination with a reinforcement of the commercial teams on site. In 2008, the latter took place mostly in the Netherlands, France and the United States. annual report While in 2000, the share of foreign activities represented 20% of the consolidated turnover; in 2008 they represented 43%. In absolute figures, turnover abroad rose from € 23.2 million to € 43.5 million over the same period of time. In 2008, turnover in the priority export markets – the Netherlands, France, the United Kingdom and the United States – rose by 17%. In the other export markets, turnover rose by 35%. In China, Duvel Moortgat managed to gather the necessary knowledge of the market through Duvel Moortgat Shanghai. On a small-scale level, the structures are being developed to make the beers available to potential consumers on specific locations. The intention is to let the consumers get acquainted with the quality beers in this initial phase. Therefore, the presence on the China markets fits in with a long-term strategy. Although nearly all of the group’s Belgian specialty beers are present on the China market, Duvel, Liefmans and Vedett Extra White show the largest potential.
Du v e l Mo o r t g a t n o m i n a t e d ‘c o m p a n y o f t h e y e a r 2008’
Duvel Moortgat was one of the six nominees for the Flemish ‘Company of the Year 2008’ award. This annual competition is an initiative of Ernst & Young, in cooperation with the financial newspaper De Tijd and Fortis.
All the candidates who take part in the competition undergo a strict quantitative and qualitative selection, completed with an audit by Ernst & Young. Thus, during the last five years, all finalists should realise a growth of at least 50% in two out of the three following fields: work force, turnover and added value.
The members of the jury referred to the nominees as ‘stars in entrepreneurship and innovation, strategy and drive, internationalisation and solid management’.
St r o n g f o c u s o n o t h e r b r a n d s
Abroad, Duvel Moortgat continues to develop the other brands alongside Duvel. In the Netherlands, the focus is on the Chouffe beers and Vedett, which was launched here in 2008. In France, there is a major interest in draught beer, and thus the attention is focused on the Maredsous abbey beers, La Chouffe and Mc Chouffe. Moreover, the latter two realised a nice growth in turnover here. In the United Kingdom, efforts are concentrated on Vedett. The British market also shows great potential for the Liefmans beers. Finally, in the United States, Duvel Moortgat operates according to a portfolio strategy, with a global approach for Duvel, Maredsous, Chouffe and the beers of the Brewery Ommegang. For further details, please turn to the paragraphs on ‘Brands and Markets’ on page 36 Report by The Board of Directors
2. Income statement: commentary
The consolidated annual accounts were prepared in accordance with the International Financial Reporting Standards (IFRS), as published by the International Accounting Standards Board (IASB), and its interpretation issued by the International Financial Reporting Interpretations Committee (IFRIC), as adopted by the European Union until 31 December 2008. In the financial year 2008, the Duvel Moortgat Group realised a consolidated turnover of € 101 million (increase of 15.5%).
Tu r n o v e r b y b r a n d
Turnover of the Group’s major beer brands once again realised a rise compared to 2007. Duvel’s turnover globally rose by 8%. The Maredsous abbey beers rose by 18.3%, the Chouffe beers by 16.3%. Bel Pils turnover decreased by 1%. Vedett Extra Blond rose by 21.4%. In the Czech Republic, the sales of the locally brewed Bernard beers rose by 33%. The American microbrewery Ommegang realised a 34.4% rise in turnover.
Tu r n o v e r b y m a r k e t
The turnover abroad rises by 22% as a result of the various initiatives taken in the priority export markets. In 31 Belgium, turnover rises by 11% in spite of a 3.8% decrease in beer consumption. In the Netherlands, turnover rises by 16.2%. In France, the Group realises a 9.2% rise in turnover. In the United Kingdom, turnover rises by | 7.6%. In the United States, a 27% rise in turnover was realised. The other countries realised a 37.8% growth. In the Czech Republic, turnover rises by 33%.
The operating revenue rises by 17% to € 105.8 million.
The operating profit (EBIT) rises by 8.3% to € 19 million. The EBIT margin drops from 20% to 18.8%. Duvel Moortgat Duvel 2008 The results of operating activities after net financing costs rise by 5.1% to € 18 million.
Consolidated profit rises by 3% to € 12.2 million.
The gross operational cash flow (EBITDA) rises by 17.9% to € 30.9 million. annual report During the General Meeting, the Board of Directors will propose that the gross dividend be raised from € 0.80 to € 1 per share. This corresponds to a payout ratio of 43% of the consolidated net profit. Ch a n g e s i n t h e c onsolidation s c o p e
At the end of 2008, the 18% minority interest in Duvel Moortgat USA was taken over by Duvel Moortgat NV.
Within the LFB Group, a new company was founded (SARL Fousseretlyon) that is running a “bar à bières” in Lyon, opened on 14 September.
Foreign activities Duvel Moortgat
USA 24.67 %
The Netherlands 19.35 %
Czech Republic 17.86 % France 16.56 %
Other countries 13.50 %
UK 8.06 %
0 % 25 % Report by The Board of Directors
Turnover by product
Duvel 52.79 %
Others 17.40 %
Bernard 7.69 % 33 Achouffe 6.75 % |
Maredsous 4.77 %
Vedett 4.11 % Moortgat Duvel 2008 Ommegang 3.51 %
Bel annual report 2.96 %
0 % 60 % Evolution of key balance sheet figures and financial ratios Consolidated key figures ( ( EBITDA/net revenue Profit/net revenue Total assets Net revenue Operating profit/net revenue ratio Solvency/Debt Shareholder’s equity Operating profit (EBIT) Non-current assets Non-current Cash andcashequivalents interest Minority Gross operationalcashflow (EBITDA) Group share Consolidated profit Profit before tax Net financecosts Depreciation Liquidity/current ratio Liquidity/current in in €000) €000) (2) (1) (1) C 167,471 101,009 100,540 t n e r r u 30.56% 12.05% 18.80% 97,024 18,990 30,018 30,865 12,163 12,178 18,082 11,280 2008 2008 -908 0.42 2.61
95 o i t a r : t n e r r u c (2) D t b e
o i t a r s t e s s a : s t b e d / t r o h s / l a t o t - r e t 154,541 29.93% 13.52% 20.05% 87,452 90,057 17,533 28,932 26,176 11,761 11,828 17,216 92,319 m 9,237
2007 2007 s t e s s a
-331 s t b e d 0.42 2.71 101 . . Evolution of beer sales A break down of group sales in Belgium 2007-2008 (*) in geographical markets ( ( Pilsners Total countries Other Czech Republic USA UK France The Netherlands Belgium Total beers(***) Savoury beersandtrappist Abbey beers(**) Thirst-quenching beers Geuze andKriek in in €000) HL) d e c u d e r (*) S e c n i
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35 annual report 2008 Duvel Moortgat | Net revenue, EBIT, profit and EBITDA by business unit strong relations withthemajorbeertraders. In doingso,development isputinthe of alotofeffort efforts to pushupsalesinthe on-trademarkets. theindependentcommercial foundedonmaking structure in2006,keeps UK, Duvel Moortgat market. Duvel’s turnover intheUnitedKingdomslightlydecreased, following beer thegeneraltrend ontheBritish was reinforced. growth ofthecountry, thecommercial possibilitiesremain.team Specificallyinthe Lillearea, inthenorth great boththeon-and off-trademarkets, thesales. campaignsIn also by thatsupported recent advertising inturnover. arise France,Duvel experienced In by beexplained thehigherbeerprices,but This canpartly well-targeted manner. developedina position,thebrandcanbefurther market assessment ofitscurrent Basedonacorrect out. research wascarried ontheperception onthebeerofbothconsumersandnon-consumers 2008, amarket theNetherlands, Duvel’sIn In ongrowing, steadily keeps bothintheon-andoff-trademarkets. popularity own, andconsequentlydoesnothave to compete inalarger group ofbeers. to can mainlybeattributed Duvel beingastrong segment share onits despite adecliningmarket, market in thetop locations, andreinforced thebrandimage. thatthebeersucceedsinconsolidatingits The fact better leaderinBelgiumthanitdid2007.Duvel increased itsvisibility , Duvel performed Being themarket Duvel D 3. Focus onbrandsandmarkets l e v u : ’s turnoverrose globallyby 8%. unit “other activities” business Total beers” businessunit “production andsalesof ( a in
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n w o 101,009 99,304 (*)T 1,705 2008 Net revenue e h
s s e n i s u b 87,452 85,799
t i n u 1,653 2007 ‘ r e h t o
acti 18,990 v 16,997 ities 1,993 2008 ’ s e d u l c n i EBIT
l l a 17,533 15,133
2,400 y t r e p o r p 2007
s t s e r e t n i 12,178 10,848 1,330 2008
d n a
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9,961 1,867 r e s 2007 v s e c i
f o
e h t 30,865 28,758 D 2,107 2008 u v l e M EBITDA t a g t r o o 26,176 23,777 2,399 2007 G p u o r . commercial willbecontinued. efforts ItalyFrance andtheUnitedStates.In , where thebrandwaslaunchedin2007, results are encouraging and commercial efforts were intensified inthecourseof year, resultinginastrong growth inBelgium, 2008,thesalesofChouffe by 16.3%.Given thebrand’sIn beersrose further strategic importance, N Duvel managedto realise aniceprogress. For aswell, anumberofyears now, thesemarkets isconsolidated. markets In theaccentonother promising in previous years promoting Duvel, continueto yieldprofit. ongrowing. keeps andpubswhere Duvel issoldandserved made The numberofsupermarkets The efforts the EastCoast. recruited for California. Outofhere, the onstepWest by step, Coastwillbeworked aswasdonebefore on Manager was segments.Market image ofthedifferent Attheendof2008,a market brandsinthevarious wasrecruited inorder to reinforce ofmarketing developmentofthestructures. Avice-president the further group’s brands. iscontinuouslygainingstrategic importance. market The American Thistranslated into a n.v. ofallthe onthedistribution bystrategic Duvel Moortgat in2006to independentlytake decisiontaken theUnitedStates,anation-wide growthIn wasrealised, despite thefinancialcrisis. due to the Thisispartly S aswell, other conceptisasuccess, thenew realised countries andMaredsous In aniceprogression. vol. were commercialised. Previously, onlytheblondMaredsous Triple (10% alc. vol.) Brune,version andMaredsous of8%alc. thedark Blondewith6%alc. Maredsous vol. quarter hasbeenputonthemarket. theUnitedStates,sincefourth In available bothintheon-andoff-tradesector, where there isstillalotof growth potential. addsto theappealinBelgium,attraction, the France, Netherlands andFrance.In beersare theMaredsous well received by thecustomers.has beenvery isapopulartourist abbey thattheMaredsous The fact byrepositioning, abbey thesamename, to theBenedictine puttingthe emphasisonthecloseconnection well. beershave abbey doneremarkably The Maredsous Turnover rose by 18.3%. The international N i g e t a r t i w e c e
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g n i w o r g Repor t by The Board ofDirectors 37
annual report 2008 Duvel Moortgat | The Brasserie d’Achouffe realises 35.4% of its turnover in Belgium and 64.6% abroad, of which 42% in the Netherlands.
In the priority markets, the local sales teams have succeeded in further developing distribution in the on- trade sector. In doing so, there’s a continuous search for ‘headstrong’ pubs, whose image matches that of the Chouffe beers.
The extraordinary character of the beers is manifested in a number of special editions, which distinguish themselves by their taste and seasonal character. The winter beer N’ice Chouffe is a dark ‘winter-warming’ beer, available from 1 December as long as stock lasts. It appeals to the close connection that exists between the Chouffe beers and the Belgian Ardennes, a tourist region attracting a lot of visitors. Chouffe Bok is launched in the October-November months. Its special method of preparation is mainly focused towards the Dutch market. Houblon Chouffe, with its typical bitter taste – brewed with three different types of hops – is available in the European countries from now on. Before, it was only available in the United States.
Ve d e t t Ex t r a Wh i t e a l s o p o p u l a r i n Ja p a n
Turnover of the Vedett beers in Belgium realised a nice growth. The continuous strong growth of Vedett proves once again that the brand – despite or thanks to its rebellious character – is becoming a well- established brand, both in the on- and off-trade markets. At the same time, Vedett proves that an innovative beer carrying a clear-cut and strong brand can be successful despite a declining market.
The sales in Belgium were given an extra push by the launch of Vedett Extra White in July. Vedett Extra White, a white beer with all of Vedett’s typical characteristics, was instantly successful in Japan, owing to the efforts made by importer Konishi.
In the United Kingdom, the presence of Vedett Extra Blond could be further expanded towards the right locations. Still, the importance of the British market remains relatively small. In other countries, the Netherlands amongst others, a number of pubs put the rebellious beer on the menu as a test case. The positive welcome of Vedett Extra White in these countries is important with the future in mind. the brand, paying featuring off. labels, new glassesandpromotional keeps material taste.relatively Atthesametime, of wellandparticular the2006refurbishment owingcharacter to itstypical where aleconsumptioningeneralisdecreasing –there isanincrease insalesabroad. BelPils holdsitsown Turnover ofBelPilsslightlydecreased by 1%.However, asopposedto thedecliningfigures in Belgium – B supermarkets. supermarkets. beershave, theBernard 2008at beenavailable sinceearly Britain Great Tesco In market. export important alsorealisedBernard asolidgrowth Russia,demandisstrongly abroad. increasing, In andSlovakia isalsoan beers.specialty logo,Bernard Free. andBernard thefuture, hopesto Bernard In distinguishitselfevenmore by producing for by beerinaswing-top example thenon-pasteurised bottle, the ‘personalised’ bottlesshowing the Differentiation ofBernard’s cornerstone remains themostimportant expansion strategy, expressed anditis andpositionagainstthebiggerbrewers. succeedsinmaintainingitsidentity Bernard Free developmentofthesuccessfulnon-alcoholicBernard amongst othersto thefurther launchedin2006. intheCzechdidexcellently Republic in2008. Brewery Once again,theBernard Turnover rose by 33%,owing B appreciated ofalltimes. breweries According onPlanet25 Breweries to theinitiators, Earth. thislistcontainsthemostpopularand by fourth BeerAdvocate intheAll-Time 2008,Ommegang wasranked Magazine December In Top National Accounts Manager. increased. toThis canbeattributed thegrowing ofthebrands, butalsoto therecruitment popularity ofa Hennepin, Rare Vos, Three Philosophers andOmmegang Witte). Atthesametime, thesalesinsupermarkets Ommegangsaw anincrease inturnoverofallthebrandsUnitedStates(OmmegangAbbey,Brewery G d r a n r e l e g n i w o r P s l i
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c n o i t p m u s n o Repor t by The Board ofDirectors 39
annual report 2008 Duvel Moortgat | Aw a r d l a u n c h e s b e r n a r d o n t h e b r i t i s h m a r k e t
For a few months now, the Bernard beers can be found on the shelves of the Tesco supermarkets. This is the result of a beer tasting contest that Bernard won at the end of 2007. Specifically, the Bernard Special Dark Beer won the 15th Tesco Drink Awards in the lager category. In total, over 400 beers competed in the various categories of the Tesco Drink Awards. They were all tasted and judged by a team of prominent specialists and journalists.
This way, Bernard is continuing its success, after the dark Bernard 13° won the International Beer Challenge ‘World’s 50 Best Beers’ in 2006. At least as important as the award was the prize that went with it: the right to be taken up in the Tesco supermarkets’ supply in Great Britain. In total, it concerns over a thousand branches nation-wide.
4. Research and development
More than ever, quality care occupies a central position within all of Duvel Moortgat’s activities. Especially now that the beer portfolio is growing and the production processes are becoming increasingly complex. All employees are maximally involved in the continuous striving to take the product’s and processes’ quality assurance to a higher level.
The brewery is keen on keeping itself informed of the most recent developments and researches within its field of study, and is therefore closely cooperating with several universities. In cooperation with suppliers and other brewers, a new investigation was started to closely study the influence of malt on certain process parameters. The investigation will be carried out at the Catholic University of Leuven.
Next to that, several new technological developments were further tested on a small scale. In this research, Duvel Moortgat cooperated with Alfa Laval in projects concerning fermentation treatment and membrane filtration techniques. occupy acentralposition thecapacity,to extending assuranceandtheuseof theBestAvailable inwhichquality Techniques (BAT) unitsinBelgium,production theCzechandUnited Republic States. The mainemphasiswasgiven realised investments for 2008,Duvel Moortgat atotalIn amountof€14.6million,spread over the 5. Investments number ofshifts. fermentation capacity. andlagering by increasing hallwasextended the ofthebrewery The capacity extended,mainlyby increasing the wasfurther Ommegang, capacity theproduction At theBrewery U d’Achouffe. capacitywereIn addition,the extended. andlagering fermentation thefieldofecology, investments installationofBrasserie In were further madeinthewastewaterpurification of therepositioning ofthebrand, aswere the Vedett total, crates. some350,000crates In are concerned. toThe project replace theoldDuvelcrateswascontinued. Also, crates theMaredsous were replaced inview generators andtherenewal ofthewater treatment installations. renewal ofthesteam,whole Puurs condenseandwater distribution site, steam theinstallationofnew hallwascombinedwithsomesmallerinvestments:to the 1,050,000hectolitres. ofthebrewery Construction isdesigned it of900,000hectolitres, toconstruction to extend enableaninitialcapacity withthepossibility hallinPuurs. 2008,thetotal wastransferred production tobrewery thenew January In The new upatotal process,production oftwelveweeks. whichtakes withsixtanksof3,200hectolitres each. capacitywasextended ensures thenormal The lagering This further B (*) F d e t i n m u i g l e r o
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e g a p 60. Repor t by The Board ofDirectors 41 annual report 2008 Duvel Moortgat | Cz e c h Re p u b l i c
The Bernard Brewery invested in new bottles and crates. The fermentation and lagering capacity was further extended, and the bottling plant was partly modernised and automatized. Bernard’s growth also translated into the construction of a new and spacious administrative building.
(in € 000) 2008 2007 2006
Planned 14,364 19,509 12,300
Realised 14,596 21,887 12,307 realised planned vs Investments:
(in € 000) planned 2008 realised 2008
Company buildings/pubs and cafés 4,409 3,416
Fabrication 3,996 2,646
Crates/bottles/barrels 2,336 3,740
Achouffe 2,100 1,162
Bernard 621 1,833
Various technical investments 522 806
Ommegang 220 589 versus realised investments. Furniture and vehicles 161 405 Comparison of planned investments Total 14,364 14,596
In the chart above, the investments of associated companies are included for 50%. P 6. Riskmanagement end of 2006 is also covered against variable short-term interestend of2006isalsocovered rates. short-term againstvariable 2006. Swap(IRS)asfrom 1January Rate The interest investment dueonthenew credit concludedatthe intereston theinvestment rates –iscovered short-term credit –concluded in2002atvariable by anInterest limited. oftheGroup are risks very Because ofitsconsiderablecashposition,theliquidity The interest due L up. insurance hasbeentaken procedures. hasbeenlimitedThe credit by risk applyingstrict Furthermore, 2004,acredit asfrom 1January C this exposure. Attheendof2008,there were contracts. no outstanding forward to withrespect theUSD,primarily CZKandGBP. canbeusedto cases, hedge contracts forward certain In exposures from various risks arising profile international canlead Duvelto severalcurrency Moortgat’s F supplier. thatwasconcludedwiththeelectricity contract term in2008,owing to prices thelong- The energydidnotincrease costsfor asmuchmarket Duvel Moortgat for the2008purchases. Additionally, costsincreased strongly in2008. thepacking inprices rise whichledto anenormous onthemarket, ofend2007causedashortage The badhopharvest records.of maltsethistorical 2008also,were theprices significantly In higherthaninthepast. value ofbarley.recent years, conditions. In theprice andthegeneralmarket The latter issetby theharvest ispurchased contracts. basedonyearly Malt isbasedonthemarket The closingdate canvary,andtheprice y t i d i u q i n g i e r o r u t i d e r c e s a h
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d n a
s e i t i l i t u Repor t by The Board ofDirectors 43
annual report 2008 Duvel Moortgat | 7. Social report
The Duvel Moorgat Group, including the fully consolidated subsidiary companies, employed 559 people at the end of 2008, of whom 339 are office workers and 220 manual workers. There are 141 female employees. The mother company employed 195 people, the fully consolidated subsidiaries 139 and the proportionally consolidated subsidiaries employed 225.
Nu m b e r o f e m p l o y e e s k e e p s g r o w i n g
In 2008 as well, the number of employees of Duvel Moortgat grew further. At the Puurs site, the management of the brewing and quality team was reinforced. As a result of the launch of a few new beers and the Liefmans takeover, two junior marketeers were added to the marketing team. At Brasserie d’Achouffe, both in production and admistrative support, a number of additional employees were recruited. In France, the company recruited additional commercial assistants.
Bo t t l i n g p l a n t s w i t c h e s t o t h r e e -s h i f t s y s t e m
On the social level, 2008 was a year in which the company management and the trade unions were on good terms. The social elections went smoothly. A new employees council and a new committee for prevention and protection at the work site were founded. At the end of the year, management and the trade unions reached an agreement on the extension of labour at the bottling plant. Spurred on by the increasing volumes, there was an agreement to switch from a two-shift system to a three-shift system, with a fixed night shift. At the end of December, the night shift had already been three-quarters filled with employees who voluntarily made the switch. In early January, the recruitment of additional workers started.
In order to provide new colleagues with the chance to integrate as soon as possible, a new, extensive welcoming brochure was put together, which was also provided to all long-serving employees.
As in previous years, training programs remain an important pillar of the human resources policy. In 2008, this was essential more than ever given the implementation of the new brewery hall, and impacted strongly on the working environment and the job description. The manual workers mainly receive an on- the-job training. First-line management – foremen and assistant foremen – participated in a cooperation and management and in a course on coaching. The commercial and back-up employees took courses depending on their individual or collective needs. Summary of employee numbers on 31 December 2008 in the course of the year confirmed the importance ofa regular update ofthesafety plan. theimportance in thecourseofyear confirmed brigade fire withtheinternal thefieldofsafety year-action, anew planwascomposedin2008.Afire-drill In employees. of thetime. andtheenvironment, plannotonlybenefitsmobility butalsothehealthof The bicycle employeesbicycle, state mustsigninwhichthey to atleast60% commute acontract toby work bicycle four thenext years, orderlogo. willbepurchased. to In someten obtainapersonalised additionalbicycles In approved. Attheendofyear, containingthecompany bikes fleetcontainedsomeseventy thebicycle was traffic Anapplication bybicycle. Mobility of fora grant from the bycicle fundoftheMinistry Flemish closeconsultationwiththeemployeesoutonhow to council,stimulate commuterIn astudywascarried ‘bycicleplan’On stafflevel, the translated into ofaso-called focus onsustainability theintroduction in2008. B y c i c e l F Duvel Moortgat Brasserie d’AchouffeBrasserie Moortgat Horeca Services Moortgat
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annual report 2008 Duvel Moortgat | Summary of employee numbers Summary of employee numbers on 31 December 2008 per country on 31 December 2008 Belgium F Steendonk P Belgium P The Netherlands Bernard brewery Czech Republic France house Bernard Malt France USA LFB Groep Total UK Totaal China Total y l l u y l l a n o i t r o p o r y l l a n o i t r o p o r
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s e i r a i d i s b u s s e i r a i d i s b u s Administrative Administrative Administrative Administrative Administrative Administrative Administrative Administrative Administrative Administrative Administrative Administrative Administrative Manual Manual Manual Manual Manual 2008 2008 225 225 334 123 94 49 71 10 74 78 22 12 76 26 29 76 39 0 0 4 1 2007 2007 200 200 315 112 98 44 64 68 73 20 10 62 19 23 62 44 1 1 8 5 1 2006 2006 179 179 289 106 92 38 59 58 61 21 58 13 21 58 41 1 1 7 9 3 0 personality. the proceeds were reinvested inqualitative establishmentswithabetter locationandvisibility, andabigger theprevious year,In strategic locationwere someestablishments withalessimportant sold, uponwhich investments. rateThis approach ofover hasleadto anexcellent98%andagoodrate occupancy ofreturn. attention to thesearch for strategic locations, profile pubowners andsound, withtheright long-term with duediligencecontinuesto pay off. MISalwaysfrom managestheportfolio auniform vision,paying (MIS)managesthegroup’s Services Immo 2008,itwasproved onceagainthatthewayIn Moortgat property 8. Realestateactivities positive reacions. sponsorattheFêtes Flemishtypically Duvel wasaneye-catching product, de Wallonie, whichledto very With specificallytargeted samplings, the withDuvel. especiallywasfamiliarised Beinga Walloon market andthevaluesofbeer.brand experience 2008,alotofattention alsowent to tastingsandfestivities. In For meetsthe campaign was continuedinBelgium, Duvel,thesuccessful2007advertising sinceitperfectly portfolio. on theotherbeersofDuvel Moortgat to amulti-brandapproach, from withastrong amono-brand The approach emphasis alsoevolved further internationalisation. offurther inthedirection inthefieldofmarketing 2008,alarge step wastaken In (*) 9. Marketing consolidated, anincrease oftheprofit andthepubowners experience oftheirbusiness. ofthecafés.attraction This way, andthebeersis awin-win situationoccurs:theimageofbrewery such,MIScanpropose tangiblethe demandsofconsumers. thedesign proposals In concerning and well assesstheneedsoflocationaswell as itcanvery andthanksto thisknow-how its properties, and therecuperation ofenergy, closecooperationwiththepubowners. MISgetsto know andthevery ofMIS’ aspects Other approach are theattention for theenvironment, by usingenergy saving materials for ofthecompany. suchaffordable inthe locationsisaconstantfactor real estate policy and yet unknown promising, so,outlater.initially atypical,butMISregarded andrightly asitturned themasvery The search In bothcasesthelocations were flagships. mostimportant the meantimehasbecomeoneofbrewery’s Brussels: Mundo’‘Mappa and oftheSint-Gorikshallen inthevicinity ‘Café Belga’ attheFlagey Square, whichin Since MISoperates according apioneer. tovision,itisoften along-term Typical are pubsin examples two S F r a e r o
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annual report 2008 Duvel Moortgat | The internationalisation translated into a specific approach of each of the markets. In other words, abroad, the shift was made from a mere distribution strategy to a specific image campaign.
Maredsous experienced a successful repositioning in 2008. The new image of abbey beer with a very close connection to the Benedictine abbey by the same name, has been welcomed very positively both in the on- and off-trade sectors, not only in Belgium, but also in the Netherlands, France and the United States. This resulted in a greater appreciation by the consumers, and consequently in additional distribution and rotation. The project for the modernisation of the visitor centre at the Maredsous abbey is ongoing.
Vedett’s marketing efforts were mainly made in the launch of Vedett Extra White, which has the same branding as Vedett Extra Blond. The rebellious character of the beers was further intensified and the marketing mix is more than ever a mix of creativity and originality. At the same time, the beer is evolving into the direction of a headstrong classic when it comes to distribution and brand image. In 2008, Vedett was put on the market in a canned version also. Additionally, the further development of the brand was continued in Belgium, along with the internationalisation of the brand, specifically in the United Kingdom and Japan; on this market mainly through the successful launch of Vedett Extra White.
The typical image of the Chouffe beers is consequently cultivated since the 2006 takeover, with a further expansion of its distribution as a result.
After the takeover of the bankrupt Brouwerij Liefmans in June 2008, the brand was brushed up immediately, preserving its authenticity. By the second quarter of 2009, the operation should be complete, with adjusted packaging, colours and supporting point-of-sales materials such as glasses, coasters etc.
Brewery Ommegang mainly targets a portfolio approach, with various beers, in order to provide a worthy portfolio. Next to that, Ommegang keeps anticipating the market with special beers in a limited edition. So, in 2008, Obamagang was launched with a wink. In the United States, marketing includes the beer portfolio as a whole, in the pubs and cafés as well.
10. Acquisition of own shares
In the financial year 2008, the company purchased 46,197 own shares. On 31 December 2008, the company holds a total portfolio of own shares of 81,163 shares, which amounts to a total value of € 2,442,742. These shares account for 1.51% of the capital. In accordance with regulations, a special unavailable reserve to the amount of € 2,442,742 was created. committee, for whichafee waspaidto theamountof€5,400. outspecialassignments regarding auditor carried information andcounsellingoftheaudit statutory 134§2oftheCompany Law, accordance withArticle thatinthefinancial In year 2008,the we report auditors activitiesofthe11. Further statutory These events do not impact the actual positionofthecompany theactual forThese eventsdonotimpact thefinancial year 2008. € 1,650,000, inimplementationoftheagreement concludedwiththecurators on24June2008. inOudenaarde were acquired 2009,thebuildingsofLiefmansbrewery On 17March to theamountof into avisitor centre, seminarandtraininglocation,amongstothers. as from theendof2008. d’Achouffe ofthesite of Brasserie This former hotel ispart andwillbetransformed signed. The payment 2009. andtransfer ofshares took placeon30January wereThe hotel activities stopped 2008,the On 15December ‘convention sociales’ decessionparts dela ofl’Hotel Vallée desFées was facts13. Important atthe endofthe financialyear of thedurationplan. shallbeissuedgiven warrants are thatthey nolongerexercisable beforeWithin thisplan,nofurther theend were 20074000ofthesewarrants exercised.be exercised atanexercise of€25.54.In price were warrants have issuedthatcan 2005, 11.200new allbeenexercised inthecourseof2005and2006.In issuedin1999canbeexercisedThe 20,640 warrants atanexercise of€21.57and, price inthemeantime, be exercised before ofthethird expiration calendaryear following were theyear thewarrants issued. asoftheissuedate.exercise often years period starting are issuedfreeThe warrants ofcharge andcannot to tothesameamountofshares. subscribe be issuedthatentitletheright haveThe warrants amaximum can 1999created of26March plan,inwhich250,000warrants Meeting awarrant General The Extraordinary 12. Warrant plan Repor t by The Board ofDirectors 49
annual report 2008 Duvel Moortgat | 14. Conflict of interest on 2 transactions – enforcement of article 523, company law
In relation to 2 transactions of managers with companies of the group, Article 523 of the Company Law is applicable. Below is the complete account of the minutes of the respective Boards of Directors.
Transaction 1
Minutes of the Board of Directors, held at the head office of the company Moortgat Immo Services NV on 25 June 2008.
At t e n d i n g
- LEMA n.v. permanently represented by Michel Moortgat - BEMO n.v. permanently represented Bernard Moortgat - LP INVEST n.v. permanently represented door Victor Philippe Moortgat - KRUG b.v.b.a. permanently represented door Daniel Krug.
So l e i t e m i t e m o n t h e a g e n d a
The sale by the company to BEMO n.v. of two properties located at Antwerp, Oude Vaartplaats 44 and 46 cadastral section C numbers 904/B and 905/F with 143 m² surface area, 144.95 m² according to measurement, at the price of € 300,000.00, payable upon execution of the deed of purchase.
Attention is drawn to the fact that this sale had previously been the subject of a decision made by the Board of Directors on 24 November 2005 when this sale was approved at the price of € 270,000.00. Due to the fact that the grant of the necessary permits took such a long time, this sale has not been finalised until this moment. Given the fact that three years have passed since this decision, and that the real estate market conditions have since evolved, it is deemed useful to submit this matter for approval to the Board anew. n.v. Upon this, the meeting iscontinuedwiththethree remaining ofLEMA directors underthechairmanship in thedeliberationnorvoting onthisitem ontheagenda. to preventWith thepurpose any misapprehensions, BEMOn.v. declares to prefer neither notto participate at Wijnegem. plots, drawnofthecompany upattheexpense 2008bySoetewey, on21May John landsurveyor chartered Hereby, thesaid concerning inconformitywiththemarket. hepointstovaluationreport thenew certainties to for transaction placeunderconditionsandcontrary thecompany thatwilltake acustomary concerns 523 oftheCompany Law, thatit ofinterest yet atthesametimefact theconflict inthistransaction BEMO n.v., pointsoutto theotherdirectors, asrelated asstipulated inArticle by mister Moortgat, Bernard After thissoleagendapoint hasbeensettled,After themeetingisadjourned. n.v.and to give BoardMoortgat ofDirectors ofDuvel notificationatthenext Furthermore, the Board decides to to add a the copyminutes of the the meeting,valuation current report providing immediate payment uponexecution of thefullpurchase ofthedeed. price unanimousvote,By theBoard agrees to BEMOn.v. to thesaleofsaidproperties of€300,000.00, attheprice D applicable offeredto suchtransactions. conditionsandcertainties by BEMOn.v.normal meetthemarket be paiduponexecution ofthedeedasiscustomary, theBoard isoftheopinionthatconditionssale will thatthepurchase purchase. inthecaseofaprivate price thefact stated valuationprice Considering the Board ofpurchase states for thattheprice offered bothproperties by BEMOn.v. corresponds to the - - - together, namely upfor athand, are inwhichthree taken bothproperties On thebasisofvaluationreport valuationprices D e n o i t a r e b i l e c in the case of a private purchasein thecaseofaprivate publicauction in thecaseofavoluntary publicauction in thecaseofacompulsory n o i s i € 300,000.00 € 270,000.00 € 240,000.00 Repor t by The Board ofDirectors 51
annual report 2008 Duvel Moortgat | Transaction 2
Minutes of the Board of Directors, held at the head office of the company Moortgat Immo Services NV on 2 March 2009.
At t e n d i n g
- LEMA n.v. permanently represented by Michel Moortgat - BEMO n.v. permanently represented Bernard Moortgat - LP INVEST n.v. permanently represented door Victor Philippe Moortgat - KRUG b.v.b.a. permanently represented door Daniel Krug.
So l e i t e m o n t h e a g e n d a
Sale by LEMA n.v. to the company of a property located at Sint-Niklaas, Houtbriel 23 cadastral section E no 2072A with a surface area of 170 m2, at a price of € 419,000.00, payable upon execution of the deed of purchase. This property serves as a café/brasserie on the ground floor and is already rented by the company at a monthly rent to the amount of € 1,734.86 and is sublet at the same rental price. LEMA n.v., as related by mister Michel Moortgat, points out to the other directors, as stipulated in Article 523 of the Company Law, the conflict of interest in this transaction yet at the same time the fact that it concerns a customary transaction for the company that will take place under conditions and contrary to certainties in conformity with the market. Hereby, he points to the valuation report concerning the said plots, drawn up on 13 January 2006 by an independent assessor (Gudrun Xpert n.v.). LEMA n.v. declares that no short values are to be mentioned on the building that is to be sold since the valuation on the date previously mentioned. This is confirmed by BEMO n.v. in its capacity of delegate director of Moortgat Immo Services n.v., the buying company. Furthermore, LEMA n.v. refers to the exploratory soil survey carried out on 5 January 2009 by ASPER bvba in Sint-Niklaas by order of Duvel Moortgat n.v., the summarising conclusion of which states: “After the analysis of the samples, concentrations of lead were found superior to the lead standards set in the fixed part of the soil, and arsenic in the groundwater near the PB3 sounding pipe (hallway adjacent to the kitchen and the pub’s toilets). These elevated concentrations are considered to be historical soil pollution, the cause of which remains nevertheless unknown. The exploratory soil survey shows that there is no clear indication that the elevated concentrations constitute serious soil pollution for people and environment. As a result, no additional descriptive soil survey is needed.” Upon this, themeetingiscontinuedwiththree remaining ofBEMOn.v. directors underthechairmanship in thedeliberationnorvoting onthisitem ontheagenda. to preventWith thepurpose any misapprehensions, LEMA n.v. declares to prefer neither notto participate isneeded. soilsurvey thatnodescriptive confirms - soilsurvey on 20February 2009,which-inaccordance withthefindingsofsubmittedexploratory Additionally, LEMA n.v. refers OVAM,granted to thesoilcertificate by the Public of Waste Agency Flanders After thissoleagendapoint hasbeensettled,After themeetingisadjourned. n.v.Duvel Moortgat to theminutes meeting, ofthecurrent andto giveBoardsurvey ofDirectors of notification at thenext Furthermore, soil theBoard andofthequoted exploratory decidesto addacopy ofthevaluationreport € 419,000.00, providing theimmediate payment uponexecution ofthefullpurchase ofthedeed ofsale. price unanimousvote,By theBoard agrees by thecompany of to attheprice thepurchase ofsaidproperty D transactions. applicableto such byof saleputforward LEMA conditionsandcertainties n.v. market meetthenormal thatreal havesubstantiallysincethen,theBoard estatefact isoftheopinionthatconditions prices risen purchase.a private 2006,andthe Taking dates from thatthisvaluationprices January into accountthefact the Board states fixed thatthepurchase price by LEMA n.v. stated in thecaseof equalsthevaluationprice - - - namely upfor athand, are inwhichthree taken theproperty,On thebasisofvaluationreport valuationprices thatitwillnotdosointhefuture. andthatitcanbeexpected of theproperty by OVAM, theBoard soilpollutionfound isoftheopinionthathistorical doesnotinfluencethevaluation granted soilsurvey,andofthecertificate oftheresults examination ofthesubmittedAfter exploratory D e n o i t a r e b i l e c in the case of a private purchasein thecaseofaprivate publicauction in thecaseofavoluntary publicauction in thecaseofacompulsory n o i s i € 419,000.00 € 377,000.00 € 335,000.00 Repor t by The Board ofDirectors 53
annual report 2008 Duvel Moortgat | 15. Policy aspects and outlook for 2009
In 2009, as in previous years, the main efforts will be made in the day-to-day progress of the group’s further development, both where brands and markets are concerned, and this with constant attention for quality. However, this doesn’t prevent some special emphasis to be made.
Br a n d s
For Duvel, the emphasis on the foreign markets will be further enhanced, although it goes without saying that Belgium also remains a major factor, both regarding volume and marketing. In previous years, in the export countries distribution was highly emphasised, but since 2008 the main focus is on the brand image of the brands and an internationally oriented marketing.
The Chouffe beers will be able to reach a broader audience when they will be made available in 33 centilitre bottles. So far, the bottled versions were only available in 75 centilitre packaging.
According to expectations, Vedett Extra White will confirm the success of the first months following its launch. Vedett Extra Blond in a canned version will prove – during the festival season mainly – that it meets a specific demand of the public. At the same time, efforts will be put in the further internationalisation of the Vedett beers.
For Maredsous, the adjustments and modernisation of the abbey’s visitor centre will constitute an important priority. The repositioning will be further continued both in Belgium and abroad, and so, in the United States Maredsous Blonde with 6% alc. vol. will be launched. At the moment, only the gold Maredsous Triple with 10% alc. vol. and the Maredsous Brune with 8% alc. vol. are commercialised.
In 2009, the redevelopment of the Liefmans brand will be continued. The authenticity of the brand will be preserved, but at the same time the beer will be made more accessible to the large public. Possibilities abroad will also be looked into. The classic and traditional Liefmans beers will be preserved, and additionally a new variety will be launched in April. All of the beers have the same class and characteristics of the classic Liefmans beer. Therefore, Liefmans will only begin to yield its full impact on the Duvel Moortgat results as from the second six months of 2009.
The Bernard beers will be further developed in Belgium and abroad. More specifically, Bernard Free will be launched as a fruity beer. I which are gaininggrowing brandrecognition inthemajorstates. Ommegang’s developedfor beers, localspecialty theUnited States,Brewery willbefurther In distribution Antwerp andGhent. Antwerp thatenablesthem to lookoutforsuch maturity biggerandbetter pubson top locationsinBrussels, for interesting hasreachedlooking andeconomicallyjustifiedpubsitesinthe major.Duvelcities Moortgat isalways Services Immo a goodlocationthatstandthetestMoortgat ofcost-benefit analysis. Nevertheless, continueto addto thechallengeoffindingappropriate plotswith onthereal estateThe highprices market R by meansofadaptationsintheoperatingequipment. position intheinvestment program. Additionally, hallwillbeextended,mainly ofthebrewery thecapacity At Bernard, occupiesacentral thelastphaseofincrease ofthefermentationcapacity andlagering Czech Republic Also, investments willbemadeinastorage andrefermentation warehouse. extended. Ommegangwillbefurther Cooperstown,ofBrewery thefermentationcapacity In andlagering United States forcrates, theChouffe packaging of thisnew inview beers. a refermented beersuchasAchouffe. investment isthepurchase 33centilitre ofnew Anotherimportant The purchase vacuumfillerandanadjusted lineshouldbetter ofanew barrel meetthespecificneedsof Achouffe Duvel crates is reaching its completion. the mainfermentations, whichwillbenefittheuniformityof yeast profiles. The renewal program ofthe Puurs,In theyeast propagation unitwillbemodernized. This willleadto theuseofconstantlyfresh yeast for Puurs ones: € 14.7million. Below are themostimportant investments 2009,various are onceagainplanned,quality,In mainlyconcerning for atotal amountof s t n e m t s e v n l a e
e t a t s e
a c s e i t i v i t Repor t by The Board ofDirectors 55
annual report 2008 Duvel Moortgat | Re s u l t s
For 2009, when raw materials are concerned, expectations are that the malt prices will remain at a high level, since the malt prices for 2009 were partly fixed in 2008. Expectations are that the high prices will be maintained due to speculations on this market.
The hop market will probably restore owing to the implementation of new plantations that will yield full profit within a few years, and by the global negative beer market evolution. This market supply, however, mainly constitutes bitter hops, while the aromatic hops Duvel Moortgat needs, will remain in short supply. Consequently, hops will remain a very expensive raw material in 2009.
The producers of the packaging materials predict further increases in prices for 2009, equivalent to those of 2008. The decrease of the prices of raw materials and energy, however, will probably negatively influence the prices offered.
In terms of the purchase of electricity, the long-term contract concluded with the supplier will be continued in 2009.
Duvel Moortgat is expecting further growth in 2009, but in view of the current crisis that is heavily impacting all sectors, and of the insecurities that go along with it, it is unable to put specific figures on this growth. Repor t by The Board ofDirectors 57 annual report 2008 Duvel Moortgat | Liefmans 59 |
Liefmans Breweries n.v. after its bankruptcy, was taken up into Duvel Moortgat in
2008, in order to avoid the loss of four centuries of expertise and quality. Duvel Moortgat Duvel
In an initial phase, all attention is focused on the products of the Brouwerij Liefmans 2008
NV. The strong brand, that radiates quality and authenticity, is gradually being
rebuilt, and successfully so. The takeover by Duvel Moortgat, and the continuity annual report that is created by it, has been positively welcomed by the Liefmans’ clients and distribution channels. Policy aspects: attention to people and environment
Duvel Moortgat is duly aware of its responsibility towards society and the environment in general. The basic principle of the brewery’s activities is producing respecting the environment, the safety and health of their employees and the population. Another crucial aspect of the corporate social responsibility are the well-kept relations with the local community and social support.
1. Duvel Moortgat and sustainability
The Duvel Moortgat brewery is an environmentally conscious company that pays attention to sustainability. Each new investment or technological alteration is judged first on its impact on the evironment. Concretely, this means that in each case, research is done of how detrimental consequences to mankind and the environment can be minimized. The preservation of quality and the use of ‘Best Available Techniques’ are also a permanent concern. Where production is concerned, green energy and recuperation of energy are optimally used, not because energy is a vital part of the price of a bottle of Duvel, but because it is a matter of social responsibility.
In 1999, Duvel Moortgat signed the “Food Industry Companies Environmental Charter”, thus committing itself to pursue a proactive environmental policy. The group aims to constantly improve its environmental performance.
In 2005, Duvel Moortgat met the audit convenant on energy efficiency in industry, with the purchase of green energy as an important environmentally friendly step. Duvel Moortgat concluded a five-year contract with energy supplier Electrabel to run on green energy exclusively. This green energy comes from water power stations on the river Rhône. In total, some 80.000 MWh of electricity were purchased.
Additionally, Duvel Moortgat invested in the implementation of 600 m² of solar panels. This project can be extended in the future to 1500 m², or even more should the roofs of the maturation cellars also be provided with solar panels.
Duvel Moortgat continues to investigate the possibility of investing in a wind park. Originally, the brewery intended to install a windmill of its own, but the company is situated to closely to the Breendonk town centre and the A12 motorway. Alternatively, possibilities of investing in a wind park are being looked into. Difficulties regarding the permits are causing the project to be delayed.
Another aspect of sustainability is the prevention of emission and waste streams through closed circuits. The generated fermentation energy is diverted through cooling systems to heat the administration Beleidsaspecten: aandacht voor mens en milieu
buildings and stockroom. Furthermore, the heat generated upon cooling of the immense maturation stockrooms is used to heat the refermentation cellars.The heating steps during the course of the brewing process are powered by recuperated heat from the previously mentioned brewage, which is recuperated through steam condensation and the use of heat exchanging processes.
All CO2 naturally created through the fermentation processes will be channelled and internally used.
This means that virtually no external CO2 will have to be purchased, and that the brewery is fully self- sufficient in terms of its carbon dioxide consumption.
The company also puts a lot of effort into reducing as much as possible the water consumption per litre of finished beer, and to maximally avoid wastewater. In 1993, an extremely efficient wastewater treatment plant was constructed, and was further modernised in 1999, 2002 and 2006. Within a separated water system, the company’s wastewater is purified until well below the Vlarem standards, before it is discharged in surface water. Concretely, the collected wastewater is purified by a combined anaerobic/aerobic system. The minimal amount of sewage sludge that is formed is used as soil improvement in agriculture. The brewery has been purifying its own water for the last fifteen years. The intention is to reuse this as cooling or rinsing water.
During the purification of water, methane gas is released, which is currently burned off. In the near future, theanaerobically produced methane gas will serve as fuel for an electrical engine within a cogeneration 61 unit. | In January 2008, production was fully transferred to the new brewery hall. This investment worth over
€ 10 million was made in the most ecological way, also in terms of materials used. Also, in setting up the new brewery hall, the neighbourhood was very well taken into consideration.
Sustainability also means paying attention to mobility and the wellbeing of the employees. Since 2008, both of those elements have been present in the Bicycle Plan. Any employee who promises to commute to work Duvel Moortgat Duvel by bike six times out of ten, can have a personalised company bicycle at his/her disposal (for more details, 2008 see ‘Social Report’ on page 44).
Across the world, some 1,4 million Duvel crates are in circulation. Gradually, all of them are replaced by new, multifunctional specimens that can handle all packaging. This is no luxury, since the number of packaging
types keeps on growing. The new crates are environmentally friendly, since they are made of recycled annual report polyurethane that contains no heavy metals. Another important factor is their user-friendliness, thanks to their comfortable soft-touch handles. The Duvel crates replacement program is continued at a pace of 200.000 to 250.000 crates a year. Also, the replacement and/or introduction of Maredsous, Vedett and Liefmans crates is taking place according to the same environmentally friendly principle.
At the moment, already some 95% of the beer is supplied in reusable bottles or barrels. 2. Sponsorship and social support
Duvel Moortgat is sponsoring many initiatives, groups and investments, national and international. Within this broad range of sponsorship, two main movements can be found.
The first one is jazz. Duvel and jazz are often bracketed together because they have so much in common. Jazz is an art form, just like Duvel. Both are to be tasted quietly in order to enjoy them optimally. They are mature and complex, with old roots yet contemporary. Both the young and the old give them a personal interpretation and perception. Even the Duvel tasting glass is reminiscent of a saxophone or a string bass.
The Duvel Jazz Lounge is present at large happenings such as the Ghent Jazz Festival and Jazz Middelheim. Furthermore, Duvel organises ‘Young Jazz Talent’ – a steppingstone for young musicians – as well as the ‘Jazz on the Terrace” tour where the audience on the pub terraces are treated to a free live concert and a Duvel.
Also, Vedett, Duvel and contemporary art make a perfect combination, since Vedett and Duvel consumers have an eye for detail and are open to creativity and originality. Therefore, the brewery pays a great deal of attention to both beers when sponsorship is concerned. This way, young artists – whatever the art form they practice – are often supported by the brewery at vernissages or when making a short film.
2008 was a fantastic year for Duvel Depot, the reception and visitor centre. In total, the brewery welcomed 27.500 visitors, which signifies a 28% rise compared to 2007. In turn, Brasseried’Achouffe counted nearly 15.000 visitors, especially from the Netherlands and Flanders. Those who had not yet tasted the beer, were pleasantly surprised by its freshness and taste. Also, the visitors are always impressed by the brewery’s modern installations and the green surroundings, so many of them combine a visit to the brewery with a hike in the forests of the Ardennes.
Brewery visits are also possible at Liefmans and at Brewery Ommegang in the United States. The latter is open throughout the year for daily tours and tastings. Visitors are familiarized with the Belgian way of beer brewing, and at the end of the tour they can taste the five award-winning Belgian-style ales. In Cooperstown, every year the two-day Belgium Comes to Cooperstown festival is organised. In 2008, five importers presented over 50 Belgian beers and 45 traditional American breweries presented their own Belgian-style beers. In total, 250 different beers were available for tasting. The festival has an excellent reputation throughout the United States.
Following the tradition established several years ago, in 2008 Duvel Moortgat donated € 2 to per visitor of the Puurs brewery: the non-profit organization Pinocchio that takes care of and counsels young burn victims. Beleidsaspecten: aandacht voor mens en milieu
Su p p o r t i n g c h i l d b u r n v i c t i m s
The non-profit organization Pinocchio looks after child burn victims. Especially the very young are often the victim, curious as they are about the big world. Burn victims, and especially children, are often very badly injured and find themselves in life-threatening situations. They suffer extreme psychosocial stress and therefore child burn victims require specific support.
In order to provide this support, some years ago the non-profit organization Pinocchio was founded and supports children in two ways. On the one hand, the organization grants financial support to the young victims, in order to provide their families with the necessary means during and after the healing process. The most important resources for this financial support are the sales of a number of gadgets, profits from benefits, donations and membership contributions. On the other hand, Pinocchio makes the public aware of the problems young burn victims have to face.
In previous years, the foundation built out a well-structured organization, and is a leading organization of the care and after-care of child burn victims in Belgium.
Moreover, all of its board members have experience in the field of the many complications that result from burns. Psychologists, nurses, physiotherapists and many others dedicate their spare time counselling the young victims. 63
The success of the foundation is manifested every year in the growing number of supporting | members and the many donations by companies and service clubs, which are vital for Pinocchio.
Duvel Moortgat Duvel 2008 annual report Bel Pils 65 |
Bel Pils is a 5% vol. low fermentation beer, bottled or cask conditioned after a long Duvel Moortgat Duvel period of maturation. The aromatic hops used for this beer give it its characteristic 2008 taste and aroma. Bel Pils is the group’s stylish luxury Pilsner and one of the on-trade
markets most typical Pilsner beers. annual report
Bel Pils has a complementary function in the brewery’s portfolio. Information for Investors and Shareholders
1. Euronext – Stock Exchange Information
Duvel Moortgat has been listed on Euronext Brussels since June 1999. On 17 January 2006, Duvel Moortgat was transferred from capitalization compartment C to compartment B (market capitalization between € 150 million and € 1 billion). Since 1 March 2005, Duvel has been part of the BEL Small Index. The current free float represents 22,41%.
Euronext code: BE0003762763 ICB sector classification: Mnemo: DUV Reuters: DUV.BR Industry : 3000, Consumer Goods Bloomberg: DUV BB SuperSector : 3500, Food & Beverage TBM-code 23lT540 Sector : 3530, Beverages OPC-code 61673 Subsector : 3533, Brewers Instrument code 115778
Total number Instrument’s name ISIN Market Symbol Capitalisation Compartment* Trading mode of shares
AB INBEV BE0003793107 BRU ABI 1 602 427 569 28 362 967 971 Compartment A Continuous
AB INBEV STR VVPR BE0005582532 BRU ABIS 1 075 077 854 2 150 156 - Call auction
CO.BR.HA (D) BE0003519270 BRU COBH 76 000 98 800 000 - Call auction
DUVEL MOORTGAT BE0003762763 BRU DUV 5 366 030 182 445 020 Compartment B Continuous
UNIBRA BE0003064574 BRU UNIB 801 900 110 662 200 Compartment C Double call auction
HEINEKEN NL0000009165 AMS HEIA 489 974 594 11 585 449 275 Compartment A Continuous
HEINEKEN HOLDING NL0000008977 AMS HEIO 245 011 848 5 351 058 760 Compartment A Continuous
BRAS.OUEST AFRIC. SN0008626971 PAR BOAF 81 975 75 417 000 Compartment C Double call auction
BRASSERIE CAMEROUN CM0000035113 PAR BCAM 1 010 212 272 757 240 Compartment B Double call auction
MALTERIES FCO-BEL. FR0000030074 PAR MALT 495 984 44 638 560 Compartment C Double call auction Overview of segment “3533, Brewers” *Co m p a r t m e n t A = La r g e Ca p s | Co m p a r t m e n t B = Mid Ca p s | Co m p a r t m e n t C = Sm a l l Ca p s Information for Investors and Shareholders
2008 2007 2006 2005 2004
Best bid 49.45 49.85 40.00 25.45 25.85
Lowest bid 30.36 35.05 32.00 34.00 20.29
Last bid at the end of December 32.99 48.74 38.53 32.31 25.85
Share evolution -47.74% 20.95% 16.14% 19.99% 20.27%
Average number of shares traded
daily 1,096 1,757 2,227 2,163 1,960
Average number of shares traded
monthly 23,389 37,346 47,319 46,331 42,312 Stock Exchange Information Exchange Stock Yearly volume 280,670 448,151 567,828 555,968 507,741
Number of shares 31/12 5,366,030 5,366,030 5,362,030 5,353,510 5,341,390
Capitalization 31/12 177,025,330 261,540,302 206,599,016 172,971,908 138,074,932
0
2,5 67 5
7,5 |
10
12,5
15
17,5
20
22,5 Moortgat Duvel
25 2008
Share evolution Duvel MoortgatShare 27,5
30
32,5
35 annual report
37,5
2008 Ja n u a r y Fe b r u a r y Ma r c h Ap r i l Ma y Ju n e Ju l y Au g u s t Se p t e m b e r Ok t o b e r No v e m b e r De c e m b e r ● Du v e l Mo o r t g a t Share evolution Duvel Moortgat compared with Bel20 and January, respectively.and January, iscalculated website.This index continuouslyand isavailable ontheEuronext at theendofFebruary, May, August andNovember, to beappliedatthebeginning ofApril,July, October thetotalDuvel index, share represents In index. aweight of2.65%. placesperquarter The revision takes version ofthe 2004(4,999.83)constitutesprice on31 December thebasisofthisnew index Smallcap return capitalization of€126million,withaminimumapproximately €30million. The level oftheformer Belgian (situation20/01/2009)iscomposedof46companieswithanaverage market The BELSmallIndex amount to atleast10%andtheweight oftheindividualshares islimited to 10%. multipliedbyindex €5,000andtheBEL20multipliedby €50,000. The rate ofcirculation atfree floatshould capitalizationissituated theBEL20 between iscomposedofsharesThe index whosefree floatmarket capitalization. tradable market companies. andfree are basedontheirliquidity selected oftheBELSmallIndex The shares thatform part wasintroduced ofsmall This index withtheintention by ofimproving Euronext andliquidity thevisibility 2. BELSmallIndex J 2008 y r a u n a F y r a u r b e M h c r a A l i r p M y a J e n u J y l u A t s u g u S e t p e m r e b O r e b o t k N o v e m r e b D e c e m r e b bel20 ● ● D u v -60 -50 -40 -30 -20 -10 10 l e 0 M t a g t r o o Information for Investors and Shareholders
20
15
10
5
0
-5
with Bel Small Index -10
-15
-20
-25
-30
-35 Share evolution Duvel MoortgatShare compared
-40
2008 2009 ● Du v e l Mo o r t g a t Fe b r u a r y Ma r c h Ap r i l Ma y Ju n e Ju l y Au g u s t Se p t e m b e r Ok t o b e r No v e m b e r De c e m b e r Ja n u a r y ● Be l Sm a l l In d e x 69
3. Permanent Liquidity Provider |
In the past, most Belgian small- and midcaps faced a lack of liquidity. That is why, upon the merger of the stock exchanges, Euronext created the statute of ‘liquidity provider’:
- A Liquidity Provider Agreement is a contract concluded between Euronext and a member of the stock Duvel Moortgat Duvel exchange, to the benefit of a particular company. 2008 - A Permanent Liquidity Provider has the obligation towards Euronext to, concerning the share for which it acts as Permanent Liquidity Provider, to maintain a permanent maximum spread between the purchase and selling price of maximum 4%, for a minimum amount of € 10,000 (on both parts). - A listed company on behalf of which a Liquidity Provider Agreement has been signed, is assured of a
quotation on the continue segment (regardless of the number of transactions concluded in the past annual report 12 months). - For control purposes, the stock exchange authorities provide the company with monthly statistics of the performance of the liquidity provider (respect of the spread, the minimum amount and the traded volume). In July 2002, Duvel Moortgat signed a Liquidity Agreement with the Degroof Bank, who is currently the liquidity rovider for the Duvel share as part of the Liquidity Provider Agreement. This brings the group a significant number of benefits:
- a rise in traded volumes thanks to the permanent presence of buying and selling prices (introduced in the name of and to the account of Degroof Bank), at which investors can trade in Duvel Moortgat shares. - The spread between selling and buying prices narrows. - Imported price fluctuations on small traded volumes are avoided. - A quotation on the continue segment of Euronext is guaranteed (an obligation under the NextPrime Label).
Date From Date To Presence Presence Presence Average Average Spread Spread (Days) (Clear rate (%)) (Gross rate (%)) capital capital (Absolute value) (% of requirement) amount amount (Euros) (% of requirement)
1/01/2008 31/01/2008 22 99.79 100.00 24,153.18 99.79 8.68 87.91
1/02/2008 29/02/2008 21 100.00 100.00 21,482.76 100.00 3.48 93.84
1/03/2008 31/03/2008 19 100.00 100.00 25,421.28 100.00 5.30 95.19
1/04/2008 30/04/2008 22 100.00 100.00 21,276.73 100.00 12.94 96.01
1/05/2008 31/05/2008 21 99.87 100.00 22,040.75 99.86 3.86 93.05
1/06/2008 30/06/2008 20 95.24 95.24 21,234.51 100.00 6.31 92.25
1/07/2008 31/07/2008 23 99.99 100.00 20,471.38 99.99 9.57 92.77 by the liquidity providerby the
1/08/2008 31/08/2008 21 100.00 100.00 21,853.33 100.00 4.99 96.26 Overview of activities in 2008 1/09/2008 30/09/2008 22 99.99 100.00 20,038.95 99.99 13.38 89.27
1/10/2008 31/10/2008 23 98.42 100.00 19,329.23 99.86 23.66 72.48
1/11/2008 30/11/2008 20 100.00 100.00 19,659.08 100.00 4.83 93.80
1/12/2008 31/12/2008 20 92.60 95.24 18,331.81 97.09 4.16 92.43 Information for Investors and Shareholders
4. Financial Communication
In recent years, the financial communication has consisted mainly of a mixture of information required for legal purposes, plus analysts’ meetings, press releases and interviews. Furthermore, the company regularly takes part in financial events.
At the moment, the share is being followed by some 5 analysts.
5. Financial Calendar
Publication annual results 2008: 20 March 2009 Annual Report 2008 available on website: 13 April 2009 General Meeting 2009: 27 April 2009 at 3 pm First Interim Statement 2009: 27 April 2009 Ex dividend date: 13 May 2009 Dividend record date: 15 May 2009 Dividend payment date: 18 May 2009 Publication half year results 2009: 31 August 2009 71 Second interim statement 2009: 13 November 2009 Publication annual results 2009: Mid March 2010 | General Meeting 2010: 26 April 2010 at 3 pm
Duvel Moortgat Duvel 2008 annual report Ommegang Three Philosophers (9.8% alc. vol.), Ommegang Abbey (8.5% alc. vol.), Hennepin
(7.7% alc. vol.), Rare Vos (6.5% alc. vol.) and Ommegang Witte (5.1% alc. vol.) are the most important beers brewed by the American production unit, the Ommegang
Brewery. With their specifically Belgian character, and together with Duvel, they respond to the American interest in specialty beers. 73 |
Turnover of all of the brands of the Ommegang Brewery in the United States grew.
At the same time, the sales in supermarkets increased. This can be attributed to the growing popularity of the brands, but also to the expansion of the commercial Duvel Moortgat Duvel department. 2008
In December 2008, Ommegang was ranked fourth by Beer Advocate Magazine in annual report the All-Time Top 25 Breweries on Planet Earth. According to the initiators, this list contains the most popular and most appreciated breweries of all times. Corporate Governance
Corporate Governance Code
As of 9 December 2004, the Belgian Corporate Governance Code for companies quoted on the stock exchange (Lippens Code) has been into existence. Its main goal is to stimulate the creation of values in the long term. This Code became effective on 1 January 2005. The Code has a large degree of built-in flexibility, so that it can be adapted to the size, activities and culture of each Company. It is based on an “apply or explain” system, which offers the Company the possibility to deviate from the stipulations of the Code. Duvel Moortgat is aware of the great importance of sound management. It will therefore apply the principles and stipulations of the Code as often as possible or else explain why it does not follow the Code.
Corporate Governance Charter
Following the recommendations of the Lippens Code, the Corporance Governace Charter was published on the website.
Since Duvel Moortgat’s introduction on Euronext, the Group has already been applying certain principles. The functions of CEO and Chairman of the Board have been separate since the introduction on the stock exchange. On the other hand, the existing committees were arranged according to the Code’s directives. For instance, the remuneration and appointment committees were split up into a separate appointment committee and a remuneration committee.
Board of Directors
The Board of Directors is the Company’s most senior administrative body. In addition to its administrative functions, the Board exercises full and material control over the Company. To this purpose, the Board meets no less than four times each year.
The Board of Directors functions in accordance with the framework of the Belgian law. Its most important role is to determine the Company’s strategic goals. In response to management proposals, it decides upon the general policy plan and oversees its implementation. The Board monitors the Group’s financial situation and sets the annual budget. It also has the responsibility to report to the shareholders. Corporate Governance
1. Composition
The Board of Directors consists of six members and is composed in the following way:
- Lema nv, represented by Michel Moortgat, managing director, who is also a director of the Belgian Brewers, and a member of the Management Committee of Fortis East Flanders. - LP Invest nv, represented by Philippe Moortgat, director, vice-chairman of the Board of Directors. - Bemo nv, represented by Bernard Moortgat, director.
The three aforementioned directors represent the majority shareholder (Fibemi)
- Mrs Veerle Baert, director. - Lessius Corporate Finance nv, represented by Wilfried Vandepoel, its managing director, who is also a director of various other companies, acts as an independent director. - Rubus nv acts as independent director and chairman of the Board of Directors. It is represented by Michel Van Hemele, who is also the chairman of DPA (quoted on Euronext Amsterdam), Essensys Partners, Ginsenga; director and chairman of the audit committee of the Delta Lloyd Bank. Michel Van Hemele is professor of International Management at the Faculty of Economics and Management at the HU Brussels.
It is the opinion of the Board of Directors that the activity of the Board in its current composition with 75 two independent directors, is efficient and sufficient, an opinion that is confirmed by the results of an internal poll. The chairman of the Board is and independent director. In the case that article 524 § 2 WVenn. | (committee of three independent directors) should have to be applied, and independent expert shall be appointed as an ad hoc agent.
As managing director, Lema nv is responsible for the day-to-day management of the Company.
LP Invest nv, Lema nv, Bemo nv, Lessius Corporate Finance nv, Rubus nv and Mrs Veerle Baert were Duvel Moortgat Duvel appointed for 6 years, effective as from 25 April 2005 until the General Meeting of 2011. 2008
The Company’s memorandum and articles of association state that “a majority of the directors shall be appointed by the General Meeting from candidates nominated for this office exclusively by Fibemi nv on condition that it or its successors (within the meaning of the Appendix to the Royal Decree of 6 October
1976 on Company annual accounts) hold(s) no less than 35% of the Company’s shares, whether alone or annual report together, at the time of both their nomination of candidates for the office of director and their appointment by the General Meeting. Should Fibemi nv represent less than 35% of the Company’s capital, Fibemi nv or its respective successors shall only be entitled to nominate one candidate for the Board of Directors per tranch of shares representing 5% of the Company’s capital.” Subject to the aforementioned being satisfied, the General Meeting is obliged to appoint the number of directors concerned from the list of candidates nominated by Fibemi nv.
A list of no less than two candidates must be submitted for each office of director to be conferred. Each candidate may be nominated only once for the offices of director to be conferred at any one time. This list must be deposited at the Company’s registered office no later than the commencement of the General Meeting at which the directors are to be appointed. The General Meeting shall recover its freedom of choice if no valid list is submitted within this period.
The duration of their term of office may not exceed six years. Should the General Meeting fail to fill a vacancy for any reason whatsoever, directors whose term of office has expired shall remain in office until the General Meeting fills the vacancy. Directors reaching the end of their term of office shall be eligible for re-election. No age limit has been set for the performance of an office of director in the Company.
2. Operation
The Board of Directors met on the following dates in 2008: 10 March, 28 April, 26 August and 12 December. Topics on the agenda were Duvel Moortgat’s financial data such as the summery tables, sales figures, monthly reports and budget follow-up, the application of IFRS, the follow-up of subsidiaries, the consolidated results, matters of a strategic nature, new and current investments, the study and analysis of acquisition files, activities of the audit committee, press releases, discussion of reports of the remuneration, nomination and audit committee, preparations for the General Meeting, and the evaluation of the observation of the stipulations of the Corporate Governance Code and Charter.
The Board of Directors can deliberate validly only if at least half of its members are present or represented. Should this quorum not be achieved, a new Board meeting shall be convened with the same agenda, which meeting shall deliberate and pass resolution validly if at least two directors are present or represented. Resolutions of the Board of Directors shall be passed by a majority of the votes cast. The Board may deliberate validly on items not specified on the agenda only with the agreement of all its members and subject to them being present in person. Personal attendance ratio showed outfour ageneralimprovement carried years against theprevious evaluation, ago. At thebeginning of2008,theBoard functioning. ofDirectors evaluateditsinternal The results ofthisanalysis strengthen therelations withthebranches. year, theBoard ofDirectors holdsoneofitsmeetingsatthemain office ofone of itssubsidiaries,in order to ofthelocalBoards ofDirectors.by Oncea thelocal managementandthepresence participation andactive companiesare monitored prepared bothby regular ofthesubsidiary salesandincomereports The activities loans,submitted onthestatus/situationofauthorised leasesandcustomer follow-up. detailedbudgetfollow-up mustalsobe statement, balancesheet, reports andratioanalysis).Regular (income financial report (income statement andbalancesheet)aquarterly financial an interim report tables, managementprovides salesstatistics, theBoard Day-to-day ofDirectors withmonthlysummary the absenceofCEO. purpose, theBoard ofDirectors amongstothers, meetsonceayear withthefullmanagementcommittee, in directors, ofthecircumstances. non-executive may exercise theirtasksinfullknowledge particularly To this informationAn internal provision procedure has alsobeendefined, underwhichalldirectors, and expense. heisabletoShould adirectors dosoatthecompany’s wishto obtainadvicefrom independentexperts, 3. Procedures Veerle Baert Veerle Baert LP Invest nvLP Invest Bemo nv Lema nv Lessius Finance Corporate Rubus nv Board ofDirectors 10/03/08 P P P P P P 28/04/08 P P P P P P 26/08/08 P P P P P E P : P t n e s e r Corporate Governance Corporate e:E 12/12/08 d e s u c x P P P P P P 77
annual report 2008 Duvel Moortgat | Committees formed by the Board of Directors
In accordance with the Corporate Governance Code, the existing remuneration and appointments committee was split up into a separate remuneration committee and an appointments committee.
1. Remuneration c o m m i t t e e
In 2008, the remuneration committee met on 7 March, 14 March and 1 August. Its members are Rubus nv, Veerle Baert and Lessius Corporate Finance nv.
The remuneration committee investigates of the company remunerates the members of the Board of Directors and the management committee in conformity with the market and in a justified way. In view of a more objective and measurable verification of bonus allocations, each year the remuneration committee draws up a specific list of conditions that support the methodology of the remuneration system in a refined way.
Remuneration Committee 07/03/08 14/03/08 01/08/08
Veerle Baert P P P
Rubus nv P P P
Lessius Corporate Finance P P P Individual
P: Pr e s e n t e: Ex c u s e d attendance rate
2. Appointments c o m m i t t e e
The members of the appointments committee are: Rubus nv, Lessius Corporate Finance and Bemo nv.
3. Au d i t c o m m i t t e e
The audit committee acts as a supervisory body examining the matters mentioned below in cooperation with the management, evaluates and reports on them to the Board of Directors and proposes actions to the Board of Directors to solve or rectify any problems diagnosed.
Its members are Lessius Corporate Finance nv, Rubus nv and LP Invest nv. Corporate Governance
The matters concerned are as follows:
- monitoring and discussion of the interim and annual figures; - discussion with the auditors of their audit plan; - the selection, evaluation, appointment and replacement of the auditors of the Group and the various companies which it comprises, and the permanent monitoring of their independence; - the organisation of the Group and the various companies which it comprises. - the organisation of internal and external financial reports; - accounting principles; - conflicts of interest; - procedures and systems; - systems and operation of internal and external audits; - special assignments at the request of the Board of Directors.
The committee met on 7 March, 25 June and 25 August and discussed the following matters: the 2007 annual results, the annual accounts of the various subsidiary companies, the auditor’s report, the press release for the 2007 annual results, 2007 budget comparison, audit of foreign subsidiaries, interim figures 30 June 2008, press release of the interim figures, discussion and follow-up of the Liefmans file, discussion and follow-up of the United States file (Ommegang Brewery and Duvel Moortgat USA), discussion and impairment of the outstanding receivables, discussion of the interim audit concerning the rebate structure, 79 explanation and discussion of the insurance policy and the risk management, evolution of corporate governance and discussion of the applied Credit control. |
Audit Committee 07/03/08 25/06/08 25/08/08
Lessius Corporate Finance P P P Duvel Moortgat Duvel
Rubus nv P P P 2008
P P P
Individual LP Invest nv
P: Pr e s e n t e: Ex c u s e d attendance rate annual report The Law of 17 December 2008 made the creation of an audit committee within the Board of Directors mandatory for companies quoted on the stock market. The Law became effective on 8 January 2009.
The tasks of the audit committee, as provided in this law, mainly consist of the supervision of the efficiency of procedures and the performance of internal and external audit systems such as: - monitoring of the financial report process; - monitoring the efficiency of the systems for internal control and risk management of the company; - monitoring the internal audit and its efficiency - monitoring the legal control of the annual accounts and the consolidated financial statements, including the observance of questions and recommendations made by the commissioner. - Assessing and monitoring of the commissioner’s impartiality.
Furthermore, in the future, the proposal of the Board of Directors to appoint the commissioner or to renew his mandate will be announced as proposed by the audit committee.
The audit committee reports to the Board of Directors on a regular basis on the execution of its tasks, and at least when the Board of Directors draws up the annual accounts. Finally, the commissioner reports to the audit committee should he find serious shortcomings in the internal audit concerning financial reporting. The Duvel Moortgat audit committee – as fixed in the Corporate Governance Charter – in its present composition and tasking closely fits the new legal regulations.
Day-to-day management
The managing director is responsible for day-to-day management, assisted by a management committee. Its members are: Krug bvba (Chief Operating Officer), Ajax Consult bvba (Chief Technical Officer), Lugandalf bvba (Human Resources Manager) and Herbert De Loose (Chief Financial Officer).
Profit allocation policy
The policy regarding the allocation of the result is continued in the same way.
At the General Meeting, the Board of Directors will propose an increase of the gross dividend from € 0.80 to € 1 per share. This is equivalent to a pay out ratio of 43% of the consolidated profit. it to take advantage of internal and external expansion opportunities. expansion andexternal advantageofinternal it to take the lightofGroup’s strategy. expansion to enable flexibility The Company wishesto retain thenecessary infuture yearsin ontheconditionthatnoexceptional financialneedsarise further This dividendmay rise and the announcement of conflicts ofinterest. and theannouncementofconflicts representationtrading andtheRoyalDecree 2006ontheright of5March ofinvestment recommendations services. The stipulationsoftheseobligationswere stated by the RoyalDecree 2006oninsider of5March andfinancial ofthefinancialsector 25bisofthe law of2August 2002onthesupervision stipulated inarticle suspicious transactions. to report andtheobligationfortransactions The measures theintermediary are lists ofinsiders, therequirements investment concerning recommendations, insider theobligationto report amongstotherstheobligationto measures compose againstinsider tradingconcern The precautionary nv,Moortgat is expected. of insidertrading, ofcompaniesquoted onthestockDuvel where contribution exchange, an active like modificationsisabiggeremphasisonthe prevention thoroughly modified. One ofthemost remarkable Following abusewas theEuropean thefightagainstmarket regulations, concerning thelegalframework The protocol andtransmitted wasexplained to allrelevant insiderson23June1999. stipulations andto maintaintheCompany’s reputation. measures toThe protocol ensure compliancewithlegal alsoincludesanumberofprecautionary oflisted sharesthe liquidity andprevent theCompany from obtainingoptimumfinancing. Areducedimpression interest ofthisiscreated), candamage investors theirbacksonthemarket. willturn knowledgeeven (orifthe profits usinginsider to make insidersare allowed If theopportunity the market. tradingdamagesthenature of Insider atprotecting themarket. compliance withthemare aimedprimarily rules. numberofprohibitory of The protocol iscomposedofacertain These rulesandthesupervision by directors, employees shareholders, (insiders). membersofthemanagementandimportant beingusedillegallyoreventheimpression ofsuchillegalusebeingcreated knowledge prevent privileged nv drew upaprotocol 1999,theBoardAt itsmeetingheldon25May ofDirectors ofDuvel to Moortgat for the ofinsidertrading prevention Protocol Corporate Governance Corporate 81
annual report 2008 Duvel Moortgat | In accordance with article 25bis, §1 of the law, Duvel Moortgat nv has drawn up a list of persons in the company who, based on an employment contract, are employed by the company and who have regular or occasional access to inside information directly or indirectly concerning Duvel Moortgat. These lists have to be updated frequently and have to remain at the disposal of the CBFA (Banking, Finance and Insurance Commission) for 5 years.
In accordance with article 25bis, §2 of the law, the members of the Board of Directors and the management were obliged to report Duvel Moortgat’s stock transactions to the CBFA.
In closing, the protocol on the prevention of insider trading, as it was drawn up by the Board of Directors on 25 May 1999, was adjusted as a result of the new regulations, and it was delivered to those concerned.
External audit
External auditing within the Duvel Moortgat Group is performed by bvba De Roover & C°, Company Auditors, represented by Guy De Roover, Company Auditor. This mission includes the auditing of the statutory annual accounts, the consolidated annual accounts and the interim accounts of Duvel Moortgat nv, its subsidiary companies and its foreign subsidiaries. The auditor’s remuneration was € 123 418.
In accordance with the provisions of article 134 §2, §4 of the Code of Company Law, the Company hereby states that no tasks were performed by any Company with which De Roover & C°, Company Auditors, has any professional cooperation agreements. The tasks performed by De Roover & C°, Company Auditors, with the exception of internal auditing and the audit of the annual accounts mainly included activities and advice relating to the audit committee. The auditor’s remuneration for this was € 5 400. Remunerations the otherexecutive director. renumeration to attributed theCEOispublishednotbefore publicationoftheremuneration to attributed benefitssuchasoptionsand/orshares, the compensationnorhasextraordinary exit extraordinary Given conditionsanddoesnotbenefitfrom thattheCEOisremunerated an according to market director ofMISamountscombinedto €478871. ad € 49641. part This figure includesthevariable The renumeration oftheexecutive directors, LemaandBemonv asexecutive nv asCEOofDuvel Moortgat and the managementcommittee. Renumeration ofthe Board ofDirectors market practice. market regulations exit were ordeviant stipulated. Allregulations areNo extraordinary inaccordance withlocal amounted to €130918. The othercomponents(suchasinsuranceandcar)amounted to €7979. The globalrenumeration ofthemanagementcommittee amounted to €729148. part The variable to theamountof€7200. services consultancy tonvLessius theamountof€8313.LPInvest supplied Finance Corporate services suppliedconsultancy These renumerations are fixed renumerations. Nootherbenefits were allocated. asfollows:are The ofthe renumeration non-executivedirectors non-executive directors non-executive Rubus nv Finance Lessius Corporate Bemo nv LP Invest nvLP Invest Veerle Baert Veerle Baert Board ofDirectors 18,000 18,000 18,000 18,000 18,000 audit committee 4,500 4,500 4,500 0 0 renumeration committee 4,500 4,500 4,500 0 0 Bappointment committee Corporate Governance Corporate 0 0 0 0 0 83
annual report 2008 Duvel Moortgat | Share ownership and warrants
The members of the management committee (excluding the managing director) hold a combined total of 230 Duvel Moortgat shares. The non-executive directors hold a combined total of 135 Duvel Moortgat shares.
In the course of 2008, no shares and/or warrants were allocated to the CEO and members of the management committee. Corporate Governance Corporate 85 annual report 2008 Duvel Moortgat | Bernard Bernard is the umbrella name for a range of premium Pilsner beers (Bernard Light,
Bernard Pilsner, Bernard Dark and Bernard Special), brewed using a traditional and 87
natural method. Thanks to these beers, the Bernard brewery is nationally renowned | as a niche player in the premium beers segment of the Czech Republic.
Once again, the Bernard Brewery in the Czech Republic did excellently in 2008. Duvel Moortgat Duvel
Turnover rose by 33 %, owing amongst others to the further development of the 2008 successful non-alcoholic Bernard Free launched in 2006. Also, the introduction of
a number of Bernard beers in supermarkets contributed to the rise in turnover. annual report
Bernard succeeds in maintaining its identity and position against the bigger brewers. Financial section
1. General information
Na m e , l e g a l f o r m a n d r e g i s t e r e d o f f i c e . Duvel Moortgat is a limited liability company under Belgian law. It has the capacity of a company that has called upon and calls upon public savings. The Company’s registered office is situated at Breendonkdorp 58, 2870 Puurs, Belgium. VAT BE 0400.764.903, Register of Legal Persons (“Rechtspersonenregister”) Mechelen.
In c o r p o r a t i o n , a m e n d m e n t t o t h e a r t i c l e s o f a s s o c i a t i o n a n d d u r a t i o n . The company was incorporated on March 12th 1931 by the deed enacted by Jozef De Marré, Notary Public of Mechelen and published in the Appendices to the (Belgian Official Gazette) of 30-31 March 1931 under reference number 3452. The Company’s Articles of Association have been amended on several occasions since then, the most recent being on 26 June 2007. The issued capital of the company was increased by certified deed through the exercise of warrants. The amendment to the Articles of Association has been filed at the registry of the Commercial Court in Mechelen on 11 July 2007, simultaneously with the Coordinated Articles of Association. The Company has been incorporated for an unlimited duration.
Fi n a n c i a l y e a r - Au d i t o f t h e a cc o u n t s The financial year begins on January 1st and ends on December 31st of each year. The audit of the Company’s annual accounts has been entrusted to the statutory auditor bvba De Roover & Co, auditors, represented by Mr. Guy De Roover, Auditor, Rijmenamsesteenweg 290, B-3150 Haacht.
Consultation o f Co m p a n y d o c u m e n t s The unconsolidated and consolidated annual accounts of the Company and associated reports are filed at the National Bank of Belgium. The Articles of Association and special reports prescribed by the Belgian Company Code are available at the registry of the Commercial Court in Mechelen. These documents can also be examined at the Company’s registered office, where copies can also be obtained. The Company’s annual reports are sent to registered shareholders each year and to any other party having requested a copy. They are available free of charge at the Company’s registered office, as are all other public information documents.
Pr i n c i p a l a c t i v i t i e s o f t h e Co m p a n y (a r t i c l e 3 o f t h e a r t i c l e s o f a s s o c i a t i o n ) Trade, in the broadest sense of the word (including production and conditioning), in: 1. all kind of drinks, whether fermented or not, such as beers, wines, spirits, waters, soft drinks and fruit juices; 2. grains and all goods necessary for the production and packaging of the aforementioned drinks, such as malt, barley, hops, etc...
The management and trading of liquor stores. Acting as a finance company by granting loans to third parties, possibly accompanied by a pledge on business assets or conditional upon business as well as personal guarantees. Financial section
The management of a general company dealing in real estate property, investment goods of all types, among other things by trading in and valuing real estate property, including the construction, alteration, finishing or fitting out of real estate property by acting as a general contractor, promoter or coordinator of the building works, by acting as an agent or as a holding company. Provision of services in the broadest sense of the word by, among other things, the delivery of advice and assistance with respect to business management and administrative management. As such, the Company may cooperate with, participate in any manner whatsoever, whether directly or indirectly, take interests in all types of enterprises, enter into all commitments, grant credits and investments, and give guarantees on behalf of third parties, including its own business. In summary, the Company may do anything in relation to the aforementioned activities or of a nature likely to encourage their achievement.
Ch a n g e i n t h e i s s u e d c a p i t a l (f u l l y p a i d u p ) The General Meeting of Shareholders, deliberating in accordance with the rules applicable for an amendment to the Articles of Association, can increase or reduce the issued capital. Should the General Meeting decide to request for a share premium, this should be paid up in full at the moment of underwriting and recorded in a non-distributable reserve account which may only be decreased or cancelled by a resolution of the General Meeting taken in accordance with the rules applicable for an amendment to the Articles of Association. The share premium shall constitute a guarantee for third parties to the same degree as the issued capital. 89 In the event of a decrease of the issued capital, all shareholders in a similar situation have to be treated equally. The other rules contained in articles 612, 613 and 614 of the Belgian Company Code must also be | complied with.
Au t h o r i z e d c a p i t a l For a period of 5 years with effect from the publication in the Annexes to the Belgian Official Gazette of the deed of amendment to the Articles of Association dated June 2nd 1999, the Board of Directors is authorized to increase the issued capital on one or more occasions by an amount equal to the amount of the Duvel Moortgat Duvel Company’s issued capital after determination of the capital increase within the framework of this Proposal 2008 on which the aforementioned General Meeting has resolved. This authorization applies to capital increases in cash and to capital increases in kind. This authorization of the Board of Directors also applies to capital increases by means of conversion of reserves. This authorization of the Board of Directors can be renewed. Within the context of a shares issue within the authorized capital, by virtue of a resolution approved in
accordance with the terms and conditions of article 535, 560 of the Belgian Company Code, the Board of annual report Directors is hereby authorized by the General Meeting to amend the existing classes of shares or other securities which may or may not represent the capital. In addition to the issuance of shares, convertible bonds and warrants, the capital increase decided upon by the Board of Directors may also be carried out through the issue of non-voting shares, shares with preferential dividend right and liquidation rights and convertible shares which may be converted on specific conditions into a smaller or larger number of ordinary shares. This authorization has not been renewed since the previous period ended on 17 June 2004 Within the context of the authorized capital, the Board of Directors is authorized to cancel or limit the preferential right, attributed to the shareholders by law, in the interests of the Company and subject to their compliance with the terms and conditions specified in articles 592 to 599 of the Belgian Company Code. The Board of Directors is authorized to cancel or limit the preferential right in favour of one or more specified parties, even if the party or parties is/are not employed by the Company or its subsidiaries.
At the time of an increase in the issued capital carried out within the limits of the authorized capital, the Board of Directors is authorized to request for a share premium. Should the Board of Directors make such a request, this premium must be recorded in a non-distributable reserve account which can only be decreased or cancelled by a resolution of the General Meeting taken in accordance with the rules applicable for an amendment to the Articles of Association.
In the absence of an explicit authorization given by the General Meeting to the Board of Directors, the authority of the Board of Directors to increase the issued capital by subscriptions in cash, with the existing shareholders’ preferential right removed or restricted, or by subscriptions in kind, will be suspended from the date of notification to the Company by the Banking, Finance and Insurance Commission (CBFA) of a public takeover bid on the Company’s shares. This authority will come into effect again immediately after the closure of such a takeover bid.
The Board of Directors is authorized to amend the Company’s Articles of Association in accordance with any capital increase resolved upon within the context of its authorization..
Na t u r e o f t h e s h a r e s At the Extraordinary General Meeting on 30 April 2007, the Company’s Articles of Association were amended in order to make them in accordance with the law of 14 December 2005 on the abolition of bearer securities.
The new Article 9 of the Company’s Articles of Association is as follows:
The securities are registered, bearer or dematerialised.
§1. Non-fully paid shares are registered shares. Fully paid shares and other securities of the Company are registered, bearer or dematerialised, within the stipulations of the law. The holder can, at any given moment and at his expense, claim the conversion of his shares into bearer or dematerialised securities. The dematerialised securities are represented by a registration in an account in the name of its owner, an acknowledged account holder or a settlement company. Financial section
The bearer securities are registered at the registered office of the company. Each holder of securities can take note of the register with regard to his securities.
§2. The bearer securities issued by the company and that are registered in a securities account on the first of January two thousand eight, are automatically dematerialised by their registration. The bearer securities that are issued by the company and that are not registered in a securities account are by right converted into dematerialised securities depending on whether they were issued before or after the twenty-third of December two thousand and five, the first of January two thousand fourteen, or the first of January two thousand thirteen, respectively.
Each share entitles the holder to one vote. No single party may cast more than 35% of the number of votes related to the total number of shares issued by the Company at the General Shareholders’ Meeting. Groups of shareholders, of which the shares are covered by the criteria contained in article 2 of the Law of March 2nd 1989 on the disclosure of significant shareholding in quoted companies and the regulation of public takeover bids, may as well not cast more than 35% of the number of votes related to the total number of shares issued by the Company at the General Shareholders’ Meeting. These restrictions will however not apply if the vote relates to an amendment to the Company’s Articles of Association or to resolutions for which a special majority is required by virtue of the Belgian Company Code.
Dividends will be paid on the date and at the place determined by the Board of Directors. The Board of 91 Directors may pay interim dividends subject to compliance with the applicable terms and conditions of the Belgian Company Code. |
After the settlement of all debts, charges and expenses of the liquidation, the net assets shall be applied first to the repayment in cash or in kind of the fully paid and not yet repaid amount of the shares. Any remaining surplus shall be divided equally among all shares. Profit-sharing certificates do not carry any entitlement to a share of the liquidation balance. Should the net proceeds be insufficient to repay all the shares, the liquidators shall make preferential repayments with respect to the most fully paid up shares until they reach Duvel Moortgat Duvel the same level as the less fully paid up shares, or call upon holders of these less fully paid up shares to make 2008 an additional capital payment.
Shares subscribable in cash must first be offered to existing shareholders in proportion to the part of the capital represented by their shares, for a period of at least fifteen days starting the day on which the
subscription is opened. The General Meeting shall determine the subscription price at which and the period annual report during which the preferential right of subscription can be exercised. Should ownership rights to shares be divided into usufructuary rights and bare property rights, the preferential right shall pass to the owner of the bare property rights. Ac q u i s i t i o n b y t h e Co m p a n y o f i t s o w n s h a r e s a n d d i s p o s a l t h e r e o f. The Extraordinary General Shareholders’ Meeting held on June 2nd 1999 explicitly authorized the Board of Directors to acquire and dispose of own shares or profit-sharing certificates in compliance with the terms and conditions of the Belgian Company Code, without requiring a prior resolution of the General Meeting, directly or through a party acting on his/her own name but for the account of the Company, or via a direct subsidiary within the meaning of articles 627, 628 and 631 of the Belgian Company Code, if their acquisition or disposal is necessary to prevent a threatening serious prejudice to the Company. This authorization is valid for a period of three years with effect from the publication of the aforementioned resolution in the Appendices to the Belgian Offical Gazette, and may be renewed in accordance with articles 620 to 623 of the Belgian Company Code. At the General Shareholders’ Meeting held on April 25th 2005, this authorization was renewed for 3 years until the next General Shareholders’ Meeting of 2008. This authorisation will be submitted for renewal at the General Shareholder’s Meeting of 27 April 2009.
The Extraordinary General Shareholders’ Meeting held on 2 June 1999 also authorized the Board of Directors to acquire the maximum number of shares permitted by virtue of article 620 to 623 of the Belgian Company Code by purchase or exchange, directly or through a party acting on his/her own name but for the account of the Company, or via a direct subsidiary within the meaning of articles 627, 628, §1 of the Belgian Company Code, at a price equal to at least 85% and at the most 115% of the last closing price at which these shares were quoted on the primary market of the Brussels Stock Exchange the day prior to this purchase or exchange. This authorization is valid for a period of 5 years with effect from the publication of the aforementioned resolution in the annexes to the Belgian Offical Gazette. The renewal of the authorisation by the General Shareholders’ Meeting held on 30 April 2007 has been published on 20 November 2007. This authorization will be submitted for renewal at the General Shareholders’ Meeting of 27 April 2009. Financial section
All amounts in the financial part are presented in thousands of €, unless stated otherwise.
2. Consolidated income statement
Notes 2008 2007
Operating revenue 105,828 90,456
Net revenue 101,009 87,452
Other operating income 4.1 4,819 3,004
Purchases -20,730 -16,039
Services and other goods -35,358 -30,902
Personnel expenses 7 -16,708 -14,856
Depreciations / amortizations and impairment -11,875 -8,643 Income statement Amortization of intangible assets and depreciation of property, plant and equipment 10/12 -11,280 -9,237
Impairment and provisions -595 594
Other operating expenses 4.2 -2,167 -2,483
Operating profit (EBIT) 18,990 17,533
Finance income 5.1 1,964 1,170
Finance expenses 5.2 -2,872 -1,501 93 Share of profit of associates 0 14 |
Profit before tax 18,082 17,216
Income tax expense 8 -5,904 -5,388
Current income tax expense -5,133 -5,262
Deferred taxes -771 -126
Profit for the period 12,178 11,828 Moortgat Duvel 2008 Attributable to Minority interest 15 67
Attributable to equity holders of the parent 12,163 11,761
EBITDA 30,865 26,176 annual report Nominal number of shares 5,366,030 5,366,030
Weighted average number of ordinary shares 9 5,305,966 5,327,064
Diluted weighted average number of ordinary shares 9 5,308,666 5,330,855
Basic earnings per share 9 2.30 2.22
Diluted earnings per share 9 2.29 2.22 3. Consolidated balance sheet
Notes 2008 2007
NON-CURRENT ASSETS 100,540 92,319
Property, plant and equipment 10 62,542 58,928
Assets Goodwill 11 4,624 2,954 Intangible assets 12 8,779 7,517 Investment property 13 21,129 21,193 Investments in associates 14 372 388 Other investments 15 2,164 431 Other receivables 15 511 516 Deferred tax assets 16 419 360 Amounts receivable after one year 17 0 32
CURRENT ASSETS 66,931 62,222
Inventories 18 8,511 5,712 Trade and other receivables 19 28,402 27,578 Cash and cash equivalents 20 30,018 28,932
TOTAL ASSETS 167,471 154,541
EQUITY 21 97,024 90,057
Share capital 12,706 12,706 Share premium 489 489 Consolidated reserves 72,481 65,024 Liabilities Retained earnings 12,163 11,761 Translation differences 1,628 919 Treasury shares -2,443 -842
MINORITY INTEREST 95 101
NON-CURRENT LIABILITIES 44,736 41,432 Interest-bearing loans and borrowings 22 19,986 18,343 Employee benefits 24 403 446 Provisions 25 334 360 Deferred tax liabilities 16 10,907 10,080 Other payables 22 13,106 12,203
CURRENT LIABILITIES 25,616 22,951
Interest-bearing loans and borrowings 22 4,242 3,734 Taxes payable 1,159 670 Trade and other payables 26 20,215 18,547
TOTAL LIABILITIES 167,471 154,541 Financial section
4. Consolidated cash flow statement
OPERATING ACTIVITIES 2008 2007
Profit after taxes 12,178 11,828 Depreciation on intangible and tangible fixed assets 11,280 9,237 Additions (reversals) on impairment losses 595 -594 Net finance cost 908 331 Income tax expense 5,904 5,388 Share of profit of associates 0 -14 Cash flow from operating activities before changes in working capital 30,865 26,176 Decrease/(increase) in trade and other receivables -1,289 -1,612 Decrease/(increase) in inventories -2,799 -848 Cash flow statement Inrease/(decrease) in trade and other payables -439 4,083 Cash generated from operations 26,338 27,799 Interest paid -646 -570 Interest received 860 928 Dividends received 19 0 Income tax paid -4,674 -5,552
CASH FLOW FROM OPERATING ACTIVITIES 21,897 22,605
INVESTING ACTIVITIES
Proceeds from sale of tangible fixed assets 40 705 Proceeds from sale of intangible fixed assets 358 86 95 Proceeds from sale of financial fixed assets 0 52
Repayments of loans granted 99 42 | Available-for-sale financial assets. -1,994 0
Acquisition of tangible fixed assets -14,002 -21,918 Acquisition of intangible fixed assets -2,507 -281 Acquisition of financial fixed assets -17 15 Changes in other assets and liabilities 27 97 Payments of loans granted -63 0
CASH FLOW FROM INVESTING ACTIVITIES -18,059 -21,202 Moortgat Duvel 2008 annual report FINANCING ACTIVITIES
Proceeds from the issue of share capital 0 103 Minority interests -6 91 Proceeds from borrowings 6,007 8.436 Subsidies -73 -79 Purchase of treasury shares -1,600 0 Repayment of borrowings -2,516 -1.894 Cash net finance costs other than interests 139 -8
Cash flow statement Increase/(decrease) of current, interest bearing debt -415 641 Dividends paid -4,305 -3.849
CASH FLOW FROM FINANCING ACTIVITIES -2,769 3.441
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 1,069 4.844
Cash and cash equivalents at beginning of year 28,932 24.056 Effect of exchange rate fluctuations 17 32
CASH AND CASH EQUIVALENTS AT END OF YEAR 30,018 28.932
CASH AND CASH EQUIVALENTS
At beginning of year
Deposits 15,968 12.842 Cash at bank and in hand 12,964 11.214 Total cash and cash equivalents at beginning of year 28,932 24.056
At end of year
Deposits 13,554 15.968 Cash at bank and in hand 16,464 12.964
CASH AND CASH EQUIVALENTS AT END OF YEAR 30,018 28.932 Financial section
5. Reconciliation of movement in capital and reserves Share Capital Share premium Share Reserves Reserve for shares own Translation reserve Retained earning equity Total
Balance at 1 January 2007 12,696 396 58,191 -842 610 10,682 81,733
Increase in share capital 10 93 103 Transfer from retained earnings to 10,682 -10,682 0 reserves Profit for the period 11,761 11,761
Dividends -3,849 -3,849 and reserves Translation differences 309 309
Balance at 31 December 2007 12,706 489 65,024 -842 919 11,761 90,057
Balance at 1 January 2008 12,706 489 65,024 -842 919 11,761 90,057 Transfer from retained earnings to 11,761 -11,761 0 reserves Profit for the period 12,163 12,163
Dividends -4,304 -4,304
Translation differences 709 709
Reconciliation of movement in capital Acquisition of treasury shares -1,601 -1,601
Balance at 31 December 2008 12,706 489 72,481 -2,443 1,628 12,163 97,024 97 |
Duvel Moortgat Duvel 2008 annual report 6. Notes to the consolidated financial statements
6.1 Significant accounting principles
Duvel Moortgat NV is a company domiciled in Belgium. The consolidated financial statements of the Company for the year ended 31 December 2008 comprise the Company and its subsidiaries (together referred to as the “Group”) and the Group’s interest in associates and joint ventures. The financial statements were authorised for issue by the Board of Directors on 12 March 2009.
(a) Statement of compliance
The consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS), as published by the International Accounting Standards Board (IASB) and its interpretations issued by the International Financial Reporting Interpretation Committee (IFRIC), as adopted by the European Union up to 31 December 2008. A number of new standards, amendments to standards and interpretations are not yet effective for the year ended 31 December 2008, and have not been applied in preparing these consolidated financial statements:
- IFRS 8 “Operating Segments” introduces the “management approach” to segment reporting. IFRS 8, which becomes mandatory for the Group’s 2009 consolidated financial statements, will require a change in the presentation and disclosure of segment information based on the internal reports regularly reviewed by the Group’s Chief Operating Decision Maker in order to assess each segment’s performance and to allocate resources to them. Currently the Group presents segment information in respect of its business and geographical segments. The business segments constitute the basis for the internal reporting. In all probability, IFRS 8 will not impact the segment information presented. We shall maintain the business segment. - Revised IAS 23 “Borrowing Costs” removes the option to expense borrowing costs and requires that an entity capitalise borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. The revised IAS 23 will become mandatory for the Group’s 2009 consolidated financial statements and will constitute a change in accounting policy for the Group. In accordance with the transitional provisions, the Group will apply the revised IAS 23 to qualifying assets for which capitalisation of borrowing costs commences on or after the effective date. Therefore there will be no impact on prior periods in the Group’s 2009 consolidated financial statements. Financial section
- IFRIC 13 “Customer Loyalty Programmes” addresses the accounting by entities that operate, or otherwise participate in, customer loyalty programmes under which the customer can redeem credits for awards such as free or discounted goods or services. IFRIC 13, which becomes mandatory for the Group’s 2009 consolidated financial statements, is not expected to have effect on the consolidated financial statements. - Revised IAS 1 “Presentation of Financial Statements” (2007) introduces the term total comprehensive income, which represents changes in equity during a period other than those changes resulting from transactions with owners in their capacity as owners. Total comprehensive income may be presented in either a single statement of comprehensive income (effectively combining both the income statement and all non-owner changes in equity in a single statement), or in an income statement and a separate statement of comprehensive income. Revised IAS 1, which becomes mandatory for the Group’s 2009 consolidated financial statements, is not expected to have effect on the consolidated financial statements. The Group plans to provide total comprehensive income in a single statement of comprehensive income for its 2009 consolidated financial statements. - Amendments to IAS 32 “Financial Instruments: Presentation” and IAS 1 “Presentation of Financial Statements – Puttable Financial Instruments and Obligations Arising on Liquidation” requires puttable instruments, and instruments that impose on the entity an obligation to deliver to another party a pro rata share of the net assets of the entity only on liquidation, to be classified as equity if certain conditions are met. The amendments, which become mandatory for the Group’s 2009 consolidated financial statements, with retrospective application required, are not expected to have effect on the consolidated 99 financial statements. - Revised IFRS 3 “Business Combinations” (2008) incorporates the following changes that are likely to be | relevant to the Group’s operations:
• The definition of a business has been broadened, which is likely to result in more acquisitions being treated as business combinations. • Contingent consideration will be measured at fair value, with subsequent changes therein recognised in profit or loss. • Transaction costs, other than share and debt issue costs, will be expensed as incurred. Duvel Moortgat Duvel • Any pre-existing interest in the acquiree will be measured at fair value with the gain or loss 2008 recognised in profit or loss. • Any non-controlling (minority) interest will be measured at either fair value, or at its proportionate interest in the identifiable assets and liabilities of the acquiree, on a transaction-by-transaction basis. annual report - Revised IFRS 3, which becomes mandatory for the Group’s 2010 consolidated financial statements, will be applied prospectively and therefore there will be no impact on prior periods in the Group’s 2010 consolidated financial statements. - Amended IAS 27 “Consolidated and Separate Financial Statements” (2008) requires accounting for changes in ownership interests by the Group in a subsidiary, while maintaining control, to be recognised as an equity transaction. When the Group loses control of a subsidiary, any interest retained in the former subsidiary will be measured at fair value with the gain or loss recognised in profit or loss. The amendments to IAS 27, which become mandatory for the Group’s 2010 consolidated financial statements, are not expected to have effect on the consolidated financial statements. - Amendment to IFRS 2 “Share-based Payment – Vesting Conditions and Cancellations” clarifies the definition of vesting conditions, introduces the concept of non-vesting conditions, requires non-vesting conditions to be reflected in grant-date fair value and provides the accounting treatment for non- vesting conditions and cancellations. The amendments to IFRS 2, that will become mandatory for the Group’s 2009 consolidated financial statements, with retrospective application, are not expected to have effect on the consolidated financial statements; - IFRIC 14 “The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction” clarifies that availability of pension assets is the case when, at the balance sheet date, there is an unconditional right to the surplus now or in the future by means of reimbursements and/or reductions in future contributions. Minimum funding requirements may have an impact on the availability. IFRIC 14, which becomes mandatory for the Group’s 2009 consolidated financial statements, with limited retrospective application, is not expected to have effect on the consolidated financial statements. - IFRIC 15 “Agreements for the Construction of Real Estate” concludes that revenues for real estate construction projects will have to be recognised using the completed contract method in many cases, except for specific situations where the percentage of completion method of revenue recognition can be applied. This is the case when a contract relates to the sale of assets, but during the construction of these assets revenue recognition criteria are met on a continuous basis (in relation to the completed part of the project). IFRIC 15, which becomes mandatory for the Group’s 2009 consolidated financial statements, with retrospective application, is not expected to have effect on the consolidated financial statements. - IFRIC 16 “Hedges of a Net Investment in a Foreign Operation” discusses a number of issues in relation to hedging currency risks on foreign operations (net investment hedges). IFRIC 16 specifically confirms only the risk from differences between the functional currencies of the parent and the subsidiary can be hedged. Additionally, currency risks can only be hedged by every (direct or indirect) parent company, as long as the risk is only hedged once in the consolidated financial statements. IFRIC 16 also determines the hedge instrument of a net investment hedge can be held by every group company, except for foreign operation itself ). IFRIC 16, which becomes mandatory for the Group’s 2009 consolidated financial statements, with prospective application, is not expected to have effect on the consolidated financial statements. Financial section
- IFRIC 17 “Distributions of Non-cash Assets to Owners” addresses the treatment of distributions in kind to shareholders. Outside the scope of IFRIC 17 are distributions in which the assets being distributed are ultimately controlled by the same party or parties before and after the distribution (common control transactions). A liability has to be recognised when the dividend has been appropriately authorised and is no longer at the discretion of the entity, to be measured at the fair value of the non-cash assets to be distributed. IFRIC 17, which becomes mandatory for the Group’s 2010 consolidated financial statements, with prospective application, is not expected to have effect on the consolidated financial statements. - IFRIC 18 “Transfers of Assets from Customers” addresses the accounting by access providers for property, plant and equipment contributed to them by customers. Recognition of the assets depends on who controls it. When the asset is recognised by the access provider, it is measured at fair value upon initial recognition. The timing of the recognition of the corresponding revenue depends on the facts and circumstances. IFRIC 18, which becomes mandatory for the Group’s 2010 consolidated financial statements, with prospective application, is not expected to have effect on the consolidated financial statements. - Amendments to IFRS 1 “First-time Adoption of IFRSs and IAS 27 Consolidated and Separate Financial Statements – Cost of an Investment in a Subsidiary, Jointly-controlled Entity or Associate” revises, amongst others, the accounting for ‘pre-acquisition dividends’ received from participating interests. Those dividends should be recognised as revenue, but such dividends may imply an indicator for the impairment of the participating interest. The amendment, which becomes mandatory for the Group’s 2009 consolidated financial statements, with prospective application, is not expected to have effect on 101 the consolidated financial statements. - Amendment to IAS 39 “Financial Instruments: Recognition and Measurement – Eligible Hedged Items” | provides additional guidance concerning specific positions that qualify for hedging (‘eligible hedged
items’). The amendment to IAS 39, which becomes mandatory for the Group’s 2010 consolidated financial statements, with retrospective application, is not expected to have effect on the consolidated financial statements. - Improvements to IFRSs (2008) is a collection of minor improvements to existing standards. This collection, which becomes mandatory for the Group’s 2009 consolidated financial statements, is not Duvel Moortgat Duvel expected to have effect on the consolidated financial statements 2008 annual report (b) Basis of preparation
The financial statements are presented in thousands of euros, rounded to the neared thousand except when stated otherwise. They are prepared on the historical cost basis principle except for investment property and financial assets classified as available-for-sale, which are stated at fair value. The financial instruments are stated at fair value.
The accounting policies have been applied consistently to all periods presented in the consolidated financial statements. The accounting policies have been applied consistently by all group entities.
The consolidated financial statements describe the financial situation on 31 December 2008.
(c) Principles of consolidation
The financial statements of subsidiaries are included in the consolidated financial statements according to the full consolidation method. Subsidiaries are those entities over which the Group has control. Control commences when the Group has the power to, directly or indirectly, determine the operational and financial policy of an entity in order to receive benefits from its activities. In deciding whether control exists, potential voting rights that are currently exercisable or convertible are considered. The financial statements of the subsidiaries are included from the date that control commences until the date that control ceases.
When taking over a minority interest in a subsidiary, goodwill corresponds to the difference in the cost price of the additional investment and the book value of the net asset that is acquired at the date of takeover.
Joint ventures are those entities over whose activities the Group has joint control, established by contractual agreement, and in which strategic decisions on the financial and operational policy are made based on unanimous agreement. Joint ventures are included using proportionate consolidation from the date that joint control commences until the date that joint control ceases.
Associates are all entities over which the Group has significant influence but not control over the financial and operating policies, without controlling them. Associates are included based on the equity method, from the date significance influence commences, until the date significant influence ceases. Financial section
All transactions, balances and unrealized gains between Group companies have been eliminated. Those transactions between joint ventures are eliminated in proportion with the interest the Group has in those joint ventures.
The consolidation scope is set out in note 3.
(d) Foreign currencies
Transactions in foreign currencies by Group entities are translated at exchange rates prevailing within the Group at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated to euro at the foreign exchange rate ruling at that date. The revenues and expenses resulting from transactions in foreign currencies and from the translation of monetary assets and liabilities denominated in foreign currencies are recognized in the income statement. Non-monetary assets and liabilities denominated in foreign currencies are stated at the foreign exchange rate ruling at the date of the transaction. The revenues and expenses of foreign operations are translated at average exchange rates per semester, assets and liabilities are translated to euro at the foreign exchange rate ruling at the balance sheet date. The components of shareholders equity are translated at the historical rate. Exchange differences arising from the translation of the shareholders equity to euro, are taken to “Translation Reserves” of the caption 103 “Equity”. | The following foreign exchange rates have been used in preparing the financial statements:
Closing rate Average rate
1 euro equals 2008 2007 2008 2007
US dollar (USD) 1.3917 1.4721 1.4708 1.4660 Duvel Moortgat Duvel Czech Koruna (CZK) 26.8750 26.6280 24.9460 26.5600 2008
Pound Sterling (GBP) 0.9525 0.73335 0.79628 0.73515
Chinese Renminbi (CNY) 9.4956 10.7524 10.2236 10.7028 Exchange rates Exchange annual report (e) Financial instruments
The Group can use forward contracts to hedge its exposure to foreign exchange rate risks, mainly with respect to USD, GBP and CZK. The gain or loss resulting from the revaluation of derivative financial instruments, used to hedge the changes in “fair value” of assets and liabilities, are recognized in the income statement, together with the gains and losses resulting from the revaluation at “fair value” of the underlying hedged component. The “fair value” of these hedged components, with respect to the risk for which they are hedged, is their carrying amount at balance sheet date translated to euro, at the foreign exchange rate ruling at that date.
(f) Available-for-sale financial assets
The investments made by the group in certain bonds and shares are classified as available-for-sale financial assets. After the first entry, these assets are stated at fair value and possible changes in the fair value, except for impairment losses and foreign exchange profits and losses on monetary items available for sale, are calculated directly in the equity. When an investment is no longer stated in the balance sheet, the cumulative profit or the cumulative loss taken up in the equity is transferred to the profit and loss account. The fair value of the available-for-sale financial assets is calculated based on the offer price quoted at the reporting date.
(g) Other investments
Those investments that are not considered available for sale are calculated at the amortized cost price based on the effective interest method, less impairment losses. Financial section
(h) Financial risk management
Pu r c h a s e s o f r a w m a t e r i a l s Malt is purchased with annual contracts. The closing date is variable, and the price is based on the market value of brewing barley. The latter is fixed by the harvest conditions and by the general market conditions, amongst others. In recent years, the quoted prices for malt have reached historical records, the reason of which they were also significantly higher in 2008.
The bad hops harvest at the end of 2007 caused a shortage on the market, which led to an enormous rise in prices for the 2008 purchases. The packaging costs also increased strongly in 2008.
The cost of electricity increased less strongly for Duvel Moortgat than the market prices, owing to the long- term contract concluded with the electricity supplier.
Fo r e i g n c u r r e n c y r i s k s Due to the international character of the Group, we are exposed to different foreign currency risks arising from various exposures primarily with respect to USD, CZK and GBP. In certain cases, forward contracts can be used to hedge this exposure. At the end of 2008, there were no outstanding forward contracts.
Cr e d i t r i s k s r e g a r d i n g c u s t o m e r s 105 The credit risk has been limited by applying strict procedures. Furthermore, credit insurance has been taken up since 1/1/2004, which insures against the most important debtor risks. |
Li q u i d i t y r i s k s Because of its considerable cash position, the liquidity risks of the Group are limited. The interest due on the investment credit – concluded in 2002 at variable short-term interest rates – will be covered by an Interest Rate Swap as from 1/1/2006. The interest due on the new investment credit concluded at the end of 2006 is also covered against variable short-term interest rates. Duvel Moortgat Duvel 2008 annual report (i) Goodwill
Goodwill amounts on the acquisition of subsidiaries, joint ventures and associates.
With respect to acquisitions before or after 1 January 2004, the goodwill represents the difference between the purchase price and the Group’s interest in the net fair value of the identifiable assets acquired, obligations and conditional obligations of the acquired party.
The goodwill is stated at cost less any accumulated impairment losses. The goodwill is not amortized but tested for impairment.
To test impairment losses, the goodwill is allocated to any cash-generating units which the Group considers to benefit from the takeover. Those cash-generating units to which goodwill is allocated, are tested annually, or more frequent when there is an indication of impairment. If the recoverable amount of the cash-generating unit is lower than the carrying amount of the unit, impairment is recognised firstly to the carrying amount of the allocated goodwill of the unit, and secondly to the other assets of the unit, pro rata the carrying amount of each asset of the unit. A recognised impairment for goodwill cannot be countered in a future period. Negative goodwill arising from an acquisition is recognized directly in profit or loss.
(j) Intangible assets
Re s e a r c h a n d development Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge, is recognized in the income statement as an expense as incurred.
Expenditure on development activities, whereby research findings are applied to a plan or design for the production of new or substantially improved products and processes, is capitalized if the product or process is technically and commercially feasible and the Group has sufficient resources to complete development, and if it is possible to make a reliable estimate of the intangible asset’s development cost, if it is possible for the intangible asset to generate future economic advantages and moreover has the intention to use and commercialise the product. The expenditure capitalised includes the cost of raw materials, direct labour and the indirect costs directly attributable to making the asset ready-to-use. Other development expenditure is recognized in the income statement as an expense as incurred. Capitalised development expenditure is stated at cost less accumulated amortization and impairment losses. Financial section
Ot h e r i n t a n g i b l e a s s e t s Other intangible assets that are acquired by the Group are stated at cost less accumulated amortization and impairment losses.
Br a n d n a m e s If part of the amount paid for a company combination refers to brand names, this is classified separately as intangible asset of which fair value is set. Expenditure on internally generated goodwill and brands is recognised in the income statement as an expense as incurred. The fair value of the brand names acquired as part of a business combination, are set using discounted cash flows.
Su b s e q u e n t expenditure Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred.
Amortization Amortization is charged to the income statement on a straight-line basis over the estimated useful lives of intangible assets. Delivery rights are amortised over the duration of this right. Location and exploitation related business assets are amortized over 10 years. Location related business assets are those business 107 assets that are paid for because of the location of the exploitation. Customer related business assets are not amortized but systematically tested for impairment. Customer | related business assets are those business assets that are paid for because of the acquired clientele. At present, there are only location related business assets. Brand names are expected to have an indefinite useful life and are therefore not depreciated. Duvel Moortgat Duvel 2008 annual report (k) Property, plant and equipment
Items of property, plant and equipment are stated at historical cost less accumulated depreciation and impairment losses. The historical cost includes the purchase price and costs directly attributable to the acquisition (e.g. installation costs, delivery and processing cost and non-deductible taxes).
The cost of a self-constructed asset includes the cost of materials, direct labour and an appropriate proportion of production overhead.
Finance expenses related to the acquisition or construction of assets considered is stated as a charge in the income statement as incurred.
The Group recognizes in the carrying amount of an item of property, plant and equipment the cost of replacing part of such an item when that cost is incurred if it is probable that the future economic benefits embodied with the item will flow to the Group. Repairs and maintenance that do not increase the future economic benefits are recognized in the income statement as an expense as incurred.
Property that is being constructed or developed for future use as investment property is classified as property, plant and equipment and stated at cost until construction or development is complete, at which time it is reclassified as investment property.
Where parts of an item of property, plant and equipment have different expected useful lives, they are accounted for as separate items of property, plant and equipment.
Leases in terms of which the Group assumes substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are stated at an amount equal to the lower of the fair value and the present value of the minimum lease payments at inception of the lease, less accumulated depreciation and impairment losses.
Lease payments are apportioned between the outstanding liability and finance charges so as to achieve a constant periodic rate of interest on the remaining balance of the liability. The corresponding lease debts, exclusive of financial charges, are recognized in the section “other non-current payables”. The finance charges are recognized in the income statement during the leasing period as financial expenses. Property, plant and equipment acquired via financial leasing, is depreciated over the expected useful lives of these assets. Financial section
Leases of assets under which all the risks and rewards of ownership are substantially retained by the lessor are classified as operating leases. Payments made under operating leases are charged to the income statement on a straight-line basis over the term of the lease.
Depreciation is charged to the income statement on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment. During the first year of use, depreciations are calculated pro rata temporis. Following percentages are applied:
Buildings – pubs and housing 2% - 3% - 4% - 10%
Industrial buildings 3% - 5% - 6%
Furniture 10% - 20%
Crates and bottles 20%
Installations and machines 6.67% - 8.33% - 10% - 12.5% - 14.29% - 20% - 25% Depreciation rates Installations on trade outlets 10% - 20% - 33%
Vehicles 20%
Pallets 20% 109 Kegs 10% |
(l) Investment property
Investment properties are properties which are held either to earn rental income or for capital appreciation or for both. Duvel Moortgat Duvel Investment properties are stated at fair value. 2008
Fair value is the most probable price that reasonably can be expected to be obtained on the market. It is the best price which reasonably can be agreed upon between buyer and seller. This valuation does not take into account exceptional situations or clauses. It is the price that can be obtained under normal competitive
circumstances between well-informed parties. annual report
This fair value is set internally by our property manager. These valuations are based on market value, rental value and a number of comparison points obtained by notaries and/or real estate agents. They are evaluated every 6 months. As a rule, no independent expert is consulted in setting the value. Any gain or loss arising from a change in fair value is recognized in the income statement. Rental income is recognized in the income statement on a straight-line basis, over the term of the lease.
(m) Inventories
Inventories are stated at the lower of cost and net realizable value.
The cost of finished products and work in progress comprises raw materials, other production materials, direct labour, other direct costs and an allocation of fixed and variable overhead based on a normal operating capacity. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling costs.
(n) Trade receivables
Trade receivables are valued at the amortized cost price based on the effective interest method, less impairment losses. Impairment losses are accounted for if the recoverable amount at balance sheet date is lower than the carrying amount. Impairment losses are determined on a case-by-case basis.
(o) Cash and cash equivalents
Cash and cash equivalents comprises bank balances and term deposits with credit institutions.
(p) Impairment
The carrying amounts of the Group’s assets, other than inventories and deferred tax assets, are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated.
For intangible assets that are not yet available for use, goodwill and assets with an indefinite life, the recoverable amount is estimated at each balance sheet date. Financial section
An impairment loss is recognized whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognized in the income statement.
The recoverable amount of the Group’s investments and its outstanding receivables is calculated as the present value of estimated future cash flows, discounted at original effective interest rate inherent to these assets. Short-term receivables are not discounted.
The recoverable amount of other assets is determined as the greater of their 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 an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to which the asset belongs.
An impairment loss with respect to investments and receivables initiated by the Group is only reversed if the subsequent increase in recoverable amount can be related objectively to an event occurring after the impairment loss was recognized.
An impairment loss in respect of goodwill is not reversed.
In respect of other assets, an impairment loss is reversed if there has been a change in the estimates used to 111 determine the recoverable amount. | An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized. Duvel Moortgat Duvel 2008 annual report (q) Share capital
When share capital recognized as equity is repurchased, the amount of the consideration paid, including directly attributable costs, is recognized as a change in equity. Repurchased shares are classified as treasury shares and presented as a deduction from total equity.
Dividends are considered as a liability in the period in which they are declared.
(r) Provisions
Provisions are recognized in the balance sheet when the Group has a present (legal or constructive) obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount of the obligation can be made. If the effects are considerable, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.
A provision for restructuring is recognized when the Group has approved a detailed and formal restructuring plan, and the restructuring has either commenced or has been announced publicly. Future normal operating costs are not provided for.
A provision for onerous contracts is recognized when the expected benefits to be derived by the Group from a contract are lower that the unavoidable cost of meeting its obligations under the contract.
A provision for soil sanitation is recognized when soil contamination has been detected and the Group has a legal obligation to decontaminate.
A provision for early retirement has been recognized for people that join the system. A provision has been recognized for those who are probable to join the system, and if a reliable determination of the number of employees can be made. Financial section
(s) Employee benefits
Pe n s i o n p l a n s The Group has a number of defined contribution plans in different countries with external insurance companies. The contributions to these plans are funded by payments from employees and the respective Group companies. Contributions to defined contribution plans are recognized as an expense in the income statement as incurred.
Wa r r a n t s The fair value of the granted warrants is stated as personnel costs, with a corresponding increase in equity. The fair value is determined per the grant date and spread over the period until the moment where the employees receive unconditional right to the warrants. The amount stated as cost is adapted to the actual amount of share warrants that become unconditional.
In case the warrants are exercised, the amounts received will be added to the issued capital (nominal value) and share premiums after deduction of all costs related to the issuing of the shares.
Bo n u s e s Bonuses received by employees and management are based on certain key financial indicators as well as personal targets. The expected amount of the bonuses is included as a cost of the year whereas the actual 113 payment will only take place after balance sheet date. | Te r m i n a t i o n b e n e f i t s
Termination benefits are recognized as a debt and cost when a Group company commits itself to either putting an end to the contract of an employee or group of employees before the normal date of retirement or to provide termination benefits as a direct consequence of an offer encouraging people to retire voluntarily. When termination benefits are due after twelve months following the balance sheet date, they are discounted. Duvel Moortgat Duvel 2008 annual report (t) Interest-bearing loans and borrowings
Interest-bearing loans and borrowings are recognized initially at cost less attributable transaction costs. Subsequent to initial recognition, interest-bearing loans and borrowings are stated at amortized cost with any difference between the initial amount and the redemption value being recognized in the income statement over the expected life of the instrument on an effective interest rate basis.
(u) Trade and other payables
Trade and other payables are stated at the amortized cost price based on the effective interest method.
(v) Income tax
Income tax on the profit or loss for the year comprises current and deferred tax. Income tax is recognized in the income statement except to the extent that it relates to items recognized directly in equity, in which case the tax effect is also recognized directly in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted at the balance sheet date and any adjustments to tax payable in respect of previous years.
Deferred taxes are recognized for all temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes, using tax rates enacted at the balance sheet date.
No deferred taxes are recognized for following temporary differences: initial recognition of the goodwill, the initial recognition of assets or liabilities that affects neither accounting nor taxable profit, and differences relating to investments in subsidiaries to the extent they will probably not reverse in the foreseeable future.
A deferred tax asset is recognized only to the extent that it is probable that sufficient future taxable profits will be available against which the asset can be utilized. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realized. Financial section
(w) Revenue and expenses
Go o d s s o l d a n d s e r v i c e s r e n d e r e d Revenue from the sale of goods is recognized in the income statement when the significant risks and rewards of ownership have been transferred to the buyer and no significant uncertainties regarding recovery of the consideration due, associated costs or the possible return of goods exist.
Amounts charged on account of third parties can not be considered as economic benefits flowing back to the Company and are therefore not recognized as revenues. Hence, duties that are part of the price charged to the customers are not recognized as revenue in the income statement.
Re n t a l i n c o m e Rental income from investment property is recognized in the income statement on a straight-line basis over the term of the lease.
Fi n a n c i a l i n c o m e Financial income comprises interest income, dividend income and foreign exchange gains. Interest income is recognized as it accrues, taking into account the effective yield on the asset. Dividend income is recognized in the income statement on the date that the dividend is received. 115 Go v e r n m e n t g r a n t s A government grant is recognized in the balance sheet initially as deferred income when there is reasonable | assurance that it will be received and that the Group will comply with the conditions attached to it. Grants that compensate the Group for expenses incurred are recognized in the income statement on a systematic basis in the same periods in which the expenses are incurred. Grants that compensate the Group for the cost of an asset are recognized in the income statement as other operating income on a systematic basis over the useful life of the asset. Duvel Moortgat Duvel Re s e a r c h a n d development , advertising a n d promotional e x p e n s e s a n d s y s t e m development c o s t s 2008 Research, advertising and promotional expenses are expensed in the year in which these costs are incurred. Development costs and system development costs are expensed in the year in which these costs are incurred if they do not meet the criteria for capitalisation.
Op e r a t i n g l e a s e p a y m e n t s annual report Payments made under operating leases are recognized in the income statement on a straight-line basis over the term of the lease. Fi n a n c e l e a s e p a y m e n t s Minimum lease payments are apportioned between the finance charge and the reduction of the outstanding liability. The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.
The financial expenses comprise interests on interest-bearing loans and borrowings, foreign exchange losses and transaction charges.
(x) Segment reporting
A business segment is a distinguishable component of the Group that is engaged in providing products or services, and that is subject to risks and rewards that are different from those of other business segments. A geographical segment is a distinguishable component of the Group that is engaged in providing products or services within a particular economic environment, and that is subject to risks and returns that are different from those of other geographical segments.
The Group has chosen the business segment as the primary source of reporting, as it corresponds to the internal financial reporting. The segment “production and sale of drinks” corresponds to more than 90% of the revenue. A further distinction between the different beers is not made as it wasn’t part of the internal management reporting. The other business segment comprises the real estate activities amongst other things. For the presentation of the geographical segment, turnover is split according to the geographical location of customers. The segmented assets are represented based on their geographical location.
(y) Capital management
The policy of the Board of Directors is aimed at maintaining a strong financial position with which it seeks to maintain the trust of investors, creditors and the markets and with which the future development of the company’s activities can be secured.
The Board of Directors monitors the level of the divided to be paid out to the normal shareholders, which could rise in the next years, insofar no special financial needs occur in view of the expansion strategy of the Group. The company indeed wishes to maintain the necessary flexibility in order to give way to internal and external expansion possibilities. Financial section
6.2 Notes to the consolidated financial statement (continuation):
In d e x
1. Segment reporting 2. Acquisition and disposal of subsidiaries 3. Consolidation scope 4. Other operating income and expenses 5. Financial income and expenses 6. Services and other goods 7. Personnel expenses 8. Income tax expense 9. Earnings per share 10. Property, plant and equipment 11. Goodwill 12. Intangible assets 13. Investment property 14. Investments in associates 15. Other investments and other receivables 16. Deferred tax assets and liabilities 117 17. Amounts receivable after more than one year 18. Inventories | 19. Trade and other receivables
20. Cash and cash equivalents 21. Capital and reserves 22. Interest-bearing loans and borrowings 23. Fair Value 24. Employee benefits Duvel Moortgat Duvel 25. Provisions 2008 26. Trade and other payables 26. Renting and operating leases 28. Contingencies 29. Capital commitments
30. Related parties annual report 31. Subsequent events 1. Segment reporting
1.1 Pr i m a r y s e g m e n t r e p o r t i n g Production and sale of drinks Other Consolidated
2008 2007 2008 2007 2008 2007
Net revenue 99,304 85,799 1,705 1,653 101,009 87,452
EBITDA 28,758 23,777 2,107 2,399 30,865 26,176
Operating profit before finance costs 16,997 15,133 1,993 2,400 18,990 17,533
Net finance costs 2,619 1,418 253 83 2,872 1,501
Share of profit of associates 0 14 0 0 0 14
Income tax expense 5,094 5,118 39 144 5,133 5,262
Minority interest 15 67 0 0 15 67
Inter-segment eliminations 0 0 0 0 0 0
Net profit of the period 10,848 9,961 1,330 1,870 12,178 11,828 Primary segment reporting Segment assets 110,205 99,371 25,114 25,847 135,319 125,218
Unallocated assets 0 0 0 0 32,152 29,323
Investments in associates 0 0 0 0 0 0
Inter-segment eliminations 0 0 0 0 0 0
Total assets 110,205 99,371 25,114 25,847 167,471 154,541
Segment liabilities 59,015 53,931 526 475 59,541 54,406
Unallocated liabilities 0 0 0 0 107,930 100,135
Inter-segment eliminations 0 0 0 0 0 0
Total liabilities 59,015 53,931 526 475 167,471 154,541
Gross capital expenditure 16,814 20,716 290 1,452 17,104 22,168
Impairment on tangible fixed assets 56 473 0 0 56 473
Depreciation of property, plant and equipment 10,338 8,240 0 15 10,338 8,255
Depreciation on in tangible fixed assets 820 443 66 66 886 509
Additions to provisions 51 -39 0 0 51 -39
Reversal of provisions -165 -159 0 0 -165 -159 Financial section
1.2 Se c o n d a r y s e g m e n t r e p o r t i n g
Belgium The Netherlands France UK 2008 2007 2008 2007 2008 2007 2008 2007 Net revenue 57,483 51,662 8,422 7,338 7,208 7,117 3,507 3,261 Total assets 140,857 127,093 0 0 2,124 1,878 1,093 2,931 Gross capital expenditure 14,190 19,432 0 0 371 57 99 43
US Czech Republic Other Consolidated repporting 2008 2007 2008 2007 2008 2007 2008 2007 Net revenue 10,738 8,435 7,772 5,838 5,879 3,801 101,009 87,452 Total assets 5,986 6,419 9,346 9,052 8,065 7,170 167,471 154,543 Gross capital expenditure 589 821 1,855 1,812 0 3 17,104 22,168 Secondary segment
2. Acquisition and disposals of subsidiaries
In 2008, no acquisitions were realised.
119 |
Duvel Moortgat Duvel 2008 annual report 3. Consolidation scope on 31/12/2008
List of the fully consolidated subsidiaries:
Duvel Moortgat nv 100%
Duvel Moortgat France sarl 100%
Moortgat Horeca Services nv 100%
Moortgat Financial Services nv 100%
Eura Drinks nv 100% subsidiaries Moortgat Immo Services nv 100%
Parallel nv 100% Fully consolidated Fully Freya’s Deli Fruit nv 70%
Duvel Moortgat USA 100%
Brewery Ommegang 100%
Belga Bar (UK) Ltd 100%
LDV-Immo nv 100%
DRC 100%
Duvel Moortgat UK Ltd 100%
Brasserie d’ Achouffe sa 100%
Duvel Moortgat Hong Kong Ltd 100%
Duvel Moortgat Shanghai Ltd 100%
List of the proportionally consolidated subsidiaries:
Brouwerij Steendonk nv 50%
Bernard Brewery as 50%
Bernard Malthouse as 50%
LFB Développement sa 50%
LFB Expansion sas 50%
Proportionally Les Tripiers sarl (LFB Strasbourg) 50%
De l'Etoile (LFB Clermont-Ferrand) 50%
Le Comtours (LFB Tours) 50%
Saint Hugues (LFB Grenoble) 50%
consolidated subsidiaries Stannancy (LFB Nancy) 50%
Fousseretlyon (LFB Lyon) 50% Financial section
List of the subsidiaries consolidated using the equity method:
Groupement Bières Spéciales Geie 33.30%
Espace Belge à Paris Geie 23.40%
The 18% minority interest in Duvel Moortgat USA was taken over by Duvel Moortgat nv, resulting in the first becoming a 100% subsidiary. The total acquisition price amounted to € 1.7 million. The group took up a € 18.000 decrease in minority interests, and goodwill to the amount of € 1.67 million.
Fousseretlyon is a newly founded subsidiary.
Force de Vente Service was liquidated at the end of 2008.
An address list with further details on the different entities is included on page 154.
121 |
Duvel Moortgat Duvel 2008 annual report 4. Other operating income and expenses
4.1 Ot h e r o p e r a t i n g i n c o m e
2008 2007
Rental income 112 108
Gain on disposal of property, plant and equipment 631 713
Other Other Fair value adjustments of investment property 230 422
Other operating income (*) 3,846 1,761
Total 4,819 3,004
(*)t h i s i t e m i n c l u d e s , a m o n g s t o t h e r s , o t h e r s a l e s a n d r e v e n u e s , b o n u s e s a n d d a m a g e s r e c e i v e d , operating income v a r i o u s c o m p e n s a t i o n s a n d t h e c h a n g e in finished p r o d u c t i n v e n t o r y a n d w o r k in p r o c e s s .
4.2 Ot h e r o p e r a t i n g e x p e n s e s
2008 2007
Impairment loss on trade receivables 112 677
Loss on the disposal of property, plant and equipment 363 489
Other Fair value adjustments of investment property 233 217
Sundry operating taxes 435 914
Other costs 1,024 186
Total 2,167 2,483 operating expenses
5. Finance income and expenses
5.1 Fi n a n c e i n c o m e
2008 2007
Interest income 887 928
Realized foreign exchange gain 786 66
Non-realized foreign exchange gain 170 35
Gain on disposal of investments 0 62
Other 121 79
Finance income Total 1,964 1,170 Financial section
5.2 Fi n a n c e e x p e n s e s
2008 2007
Interest expense 930 861
Realized foreign exchange losses 187 250
Non-realized foreign exchange losses 1,330 293
Impairment of available-for-sale financial assets 311 10
Other 114 87
Finance expenses Total 2,872 1,501
In the reporting year, in respect of the available-for-sale financial assets, an impairment loss to the amount of € 0.28 million is taken up. This loss is related to an important and permanent decrease of share prices.
6. Services and other goods
This caption mainly consists of maintenance expenses, administrative expenses, selling and distribution expenses, marketing, insurance, various overhead expenses and royalties. 123
7. Personnel expenses |
2008 2007
Wages and salaries 12,766 11,318
Compulsory social security contributions 2,846 2,463
Pension expenses – contribution to pension plans 441 406
Other personnel expenses 655 669
Total 16,708 14,856 Moortgat Duvel 2008 Personnel expenses annual report 8. Income tax expense
2008 2007
Current year tax expense 5,199 5,284 Adjustments for prior years -66 -23 Deferred taxes 771 126 Total 5,904 5,388
Profit before tax 18,082 17,216
Adjustments to tax basis - share in the result of equity 0 -14
Income tax expense - Non-deductible expenses 1,352 965 - Investment allowance -108 -123 - Tax shelter 0 -600 - Notional interest deduction -2,479 -1,972 - Non-taxable surplus value -395 -508 - Unrecognized fiscal losses of the financial year 970 898 - Recuperation of financial losses -30 151 - Taxable surplus value previous years 0 26 - Tax exempt foreign income -220 0 Taxable profit 17,172 16,039 Income tax expenses calculated at 33.99% 5,837 5,452
Difference 67 -64
Under / (over) provided in prior years -52 -207
Effect of different tax rates in foreign countries 119 143
Total 67 -64
Effective tax rate 32.65% 31.30%
9. Earnings per share
2008 2007
Net profit for the period attributable to ordinary shareholders 12,178 11,828 Weighted average number of ordinary shares 5,305,966 5,327,064 Basic earnings per share in euro 2,30 2,22
Net profit for the period attributable to ordinary shareholders 12,178 11,828
Weighted average number of ordinary shares 5,305,966 5,327,064 Adjustments for warrants 2,701 3,791 Weighted average number of ordinary shares (diluted) 5,308,666 5,330,855 Diluted earnings per share in euro 2.29 2.22 Earnings per share Financial section
10. Property, plant and equipment
cost Land and buildings and Plant equipment and Furniture vehicles and Leasing similar rights Other tangible assets fixed assets under Fixed construction and - advance pay ments Total
Balance at 1 January 2007 24,228 78,463 4,863 657 6,289 5,146 119,646
Acquisitions 5,414 12,412 387 144 922 2,129 21,408
Acquisitions through business combinations 0 0 0 0 0 0 0
Transfers and disposals -52 -1,942 -178 -291 -201 -241 -2,905 Transfers and disposals through business 0 0 0 0 0 0 0 combinations Exchange differences -89 -73 -44 9 -150 4 -343
Transfer to other asset categories 1,297 2,402 15 -104 0 -3,729 -119
Balance at 31 December 2007 30,798 91,262 5,043 415 6,860 3,309 137,687
Depreciation and impairment loss
Balance at 1 January 2007 9,227 55,429 3,506 354 3119 0 71,635
Depreciation charge for the year 1,077 6,474 423 80 733 0 8,787
Property, plant and equipment 2007 Depreciation through business combinations 0 0 0 0 0 0 0 Impairment loss 0 0 0 0 359 0 359 125 Transfers and disposals -88 -1430 -140 -206 -21 0 -1,885 Transfers and disposals through business 0 0 0 0 0 0 0 | combinations
Exchange differences -16 -21 -9 3 13 0 -30
Transfer to other asset categories -4 -2 2 -103 0 0 -107
Balance at 31 December 2007 10,196 60,450 3,782 128 4,203 0 78,759
Carrying amounts
At 1 January 2007 15,001 23,034 1,357 303 3,170 5,146 48,011 Moortgat Duvel
At 31 December 2007 20,602 30,812 1,261 287 2,657 3,309 58,928 2008 annual report Property, plant and equipment 2008 At 31 December 2008 At 31December At 1 January 2008 At 1January Balance at 31 December 2008 Balance at31December Transfer to otherassetcategories Exchange differences combinations Transfers anddisposalsthrough business Transfers anddisposals C Impairment loss Impairment Depreciation through businesscombinations Depreciation charge for theyear Balance at 1 January 2008 Balance at1January Balance at 31 December 2008 Balance at31December Transfer to otherassetcategories Exchange differences combinations Transfers anddisposalsthrough business Depreciation Transfers anddisposals Acquisitions through businesscombinations Acquisitions Balance at 1 January 2008 Balance at1January C arrying ost
amounts
and
impairment
loss 22,006 20,602 11,666 10,196 33,672 30,798 1,647 2,196 -138 725 -66 -98 27 51 Land and 0 0 0 0 0 buildings 101,595 35,438 30,812 66,157 60,450 91,262 -1,711 -1,860 7,468 2,547 9,696 -27 -23 -50 Plant and 0 0 0 0 0 equipment 1,066 1,261 4,146 3,782 5,212 5,043 -150 449 478 -25 -60 -86 -73 Furniture and 0 0 0 0 0 0 vehicles 213 287 212 128 425 415 90 14 Leasing and -6 -4 0 0 0 0 0 0 0 0 0 similar rights 2,432 2,657 4,432 4,203 6,864 6,860 -598 -646 118 683 749 -30 -69 -30
56 Other tangible 0 0 0 0 fixed assets Fixed assets under -3,253 1,387 3,309 construction and 1,387 1,319 3,309
19 advance pay- -7 0 0 0 0 0 0 0 0 0 0 0 ments 149,155 137,687 62,542 58,928 86,613 10,337 78,759 14,452 -1,939 -2,068 -625 -200 -716 25 56 0 0 0 0 Total Financial section
Th e m o s t i m p o r t a n t investments r e l a t e t o :
2008 2007
Investments in catering businesses 0 1,218
Investments in fixture / furniture of catering businesses 1,561 786
Company buildings and land 2,196 1,296 Brewery hall 408 8,911
Machinery hall 405 0
Water purification 371 0
Bottles, crates and kegs 4,161 4,815
CCT, fermentation, lagering 2,281 1,440
Various technical investments 627 305
Various technical investments Bernard 1,577 977 Most important investments Various technical investments Ommegang 485 606
Furniture and vehicles 524 775
Total 14,596 21,129
Se c u r e d a s s e t s Assets are pledged for an amount of 8,304,000 € (bottling plant) and the commitment was made not to 127 sell or mortgage these assets. The Group has also committed itself not to dispose of nor to mortgage the business assets, partly or as a whole. Those commitments, with the exception of the privilege of the unpaid | seller, apply to the new loan of € 3,000,000, contracted in 2006.
Im p a i r m e n t s The fixtures of a bar abroad have been tested for impairment because revenue was lower than initially budgeted. This test resulted in an impairment of € 56,000 (2007: € 473,000). The recoverable amount was calculated taking into account the expected future cashflows over the remaining rental period discounted Duvel Moortgat Duvel at the WACC of the company. 2008 annual report 11. Goodwill
Acquisition cost Goodwill
As per 1 januari 2007 2,954 Acquistitions through business combinations 0 Effects of movements in foreign exchange 0 Balance sheet as per 31 December 2007 2,954 Goodwill As per 1 January 2008 2,954 Purchase of minority share 1,671 Effects of movements in foreign exchange 0 As per 31 December 2008 4,624
Impairment losses
As per 1 January 2007 0 Impairment losses 0 Effects of movements in foreign exchange 0 As per 31 December 2007 0
As per 1 January 2008 0 Impairment losses 0 Effects of movements in foreign exchange 0 As per 31 December 2008 0
Carrying amount
As per 1 January 2007 2,954 As per 31 December 2007 2,954
As per 1 January 2008 2,954 As per 31 December 2008 4,624 Financial section
The total carrying amount of the goodwill was attributed to:
2008 2007
Brasserie d’Achouffe 2,954 2,954
Duvel Moortgat USA 1,671 0
Totaal 4,624 2,954
Te s t i n g g o o d w i l l Br a s s e r i e d’Ac h o u f f e Goodwill was tested for impairment at the various company divisions, the lowest level within the group at which goodwill is monitored for internal management purposes.
The group has stipulated a fair value of the acquired trademark in the application of a discouting rate of 10 percent for the expected future cash flows over the next 10 years.
The goodwill as a result of the takeover is mainly attributable to the synergy advantages that are expected to result from the integration of the company in the existing activities of the group. The carrying amount was calculated to be lower than the recoverable amount, as a result of which no impairment loss is included. 129
e s t i n g g o o d w i l l u v e l o o r t g a t
T D M USA | The group has stipulated a fair value of Duvel Moortgat USA in the application of a discouting rate of
10 percent for the expected future cash flows over the next 5 years. The carrying amount was calculated to be lower than the recoverable amount, as a result of which no impairment loss is included. Duvel Moortgat Duvel 2008 annual report 12. Intangible assets
Cost and Research development costs Concessions patents, etc. licenses, other intangible assets Brands Prepayments Total
Balance at 1 January 2007 199 1,575 2703 5,505 125 10,107
Acquisitions 0 255 2 0 24 281
Acquisitions through business combinations 0 0 0 0 0 0
Transfers and disposals 0 -64 0 0 -26 -90
Transfers to other asset categories 0 103 0 0 -103 0
Exchange differences 1 0 78 0 0 79
Balance at 31 December 2007 200 1,869 2,783 5,505 20 10,377 Intangible assets 2007 Intangible Amortization and impairment losses
Balance at 1 January 2007 107 1,128 1,088 0 0 2,323
Amortization for the year 40 296 174 0 0 510
Acquisitions through business combinations 0 0 0 0 0 0
Transfers and disposals 0 -4 0 0 0 -4
Exchange differences 0 0 31 0 0 31
Balance at 31 December 2007 147 1,420 1,293 0 0 2,860
Carrying amounts
At 1 January 2007 92 447 1,615 5,505 125 7,784
At 31 December 2007 53 449 1,490 5,505 20 7,517 Financial section
Cost and Research development costs Concessions patents, etc.. licenses, Other intangible assets Brands payments Pre Total
Balance at 1 January 2008 200 1,869 2,783 5,505 20 10,377
Acquisitions 59 574 125 1750 0 2,508
Acquisitions by business combinations 0 0 0 0 0 0
Transfers and disposals 0 -81 0 -352 0 -433
Transfers to other asset categories 0 20 0 0 -20 0
Exchange differences 0 -3 -23 0 0 -26
Balance at 31 December 2008 259 2,379 2,885 6,903 0 12,426 Intangible assets 2008 Intangible Amortization and impairment losses
Balance at 1 January 2008 147 1,420 1,293 0 0 2,860
Amortization for the year 44 436 219 187 0 886
Amortization by business combinations 0 0 0 0 0 0
Transfers and disposals 0 -75 0 0 0 -75 Exchange differences 0 -2 -22 0 0 -24 131 Balance at 31 December 2008 191 1,779 1,490 187 0 3647 |
Carrying amount
At 1 January 2008 53 449 1,490 5,505 20 7,517
At 31 December 2008 68 600 1,395 6,716 0 8,779 Duvel Moortgat Duvel 2008 annual report 13. Investment property
2008 2007
Balance at 1 January 21,193 19,746
Acquisitions 216 1,242
Disposals and transfers -277 0
Fair value adjustments -3 205
Balance at 31 December 21,129 21,193
Investment property The investment property relates to properties let to a third party over a renewable period of 9 years.
14. Investments in associates
Ownership
Countries 2008 2007
F.V.S (liquidated) France 0 33.3%
Espace Belge à Paris France 23.4% 23.4%
Groupement Bières Spéciales France 33.0% 33.0% associates
Investments in Su m m a r y o f t h e f i n a n c i a l information o n a s s o c i a t e s – 100%
Assets Liabilities Equity Net Revenue Profit / (loss) F.V.S (in liquidation) 125 25 48 100 40 Espace Belge à Paris 1,544 0 1,448 143 96 Groupement des Bières Spéciales 6,753 6,753 0 20,496 0 2007 Total 8,422 6,778 1,496 20,739 136
Assets Liabilities Equity Net Revenue Profit / (loss) F.V.S (in liquidation) 0 0 0 0 0 Espace Belge à Paris 1,563 0 1,448 161 115 Groupement des Bières Spéciales 9,038 9,004 0 24,602 0 2008 Total 10,601 9,004 1,448 24,763 115 Financial section
Su m m e r y o f f i n a n c i a l information o n j o i n t v e n t u r e s – 100%
Non-current Current Non-current Current assets assets liabilities liabilities Profits Costs
Bernard Brewery & Malthouse 6,979 11,408 6,495 2,020 13,360 13,497 Steendonk Brewery 620 955 221 466 962 822 LFB Group 720 2,104 632 1,068 4,024 3,326 2007 Total 8,319 14,467 7,348 3,554 18,346 17,645
Non-current Current Non-current Current assets assets liabilities liabilities Profits Costs
Bernard Brewery & Malthouse 6,928 12,079 6,348 1,015 17,868 17,210 Steendonk Brewery 246 1,152 54 399 454 397 LFB Group 1,156 2,538 1,256 901 5,028 3,980 2008 Total 8,330 15,769 7,658 2,315 23,350 21,587
15. Other investments and other receivables
2008 2007
Various participations (<10%) 448 431 133
Available-for-sale financial assets 1,716 0 | Other investments (total) 2,164 431
Receivables on joint ventures 511 516
Other receivables (total) 511 516 Other investments Other Duvel Moortgat Duvel 2008 annual report 16. Deferred tax assets and liabilities
2008 2007
Balance at 1 January -9,720 -9,498
Deferred tax assets 360 262
Deferred tax liabilities -10,080 -9,760
Deferred tax (income statement) -770 -126
Regularisation corporate tax stated as deferred tax 0 -96
and liabilities Balance at 31 December -10,490 -9,720
Deferred tax assets 418 360 Deferred tax assets Deferred tax liabilities -10,908 -10,080
Total -10,490 -9,720
Deferred tax assets Deferred tax liabilities 2008 2007 2008 2007
Property, plant and equipment 259 326 5,458 5,298 Intangible assets 0 0 1,838 1,865 Provisions 0 0 2,341 2,010 Inventories 154 29 1,046 570 Deferred charges and accrued income 0 0 225 337 Previous tax losses 5 5 0 0 and liabilities Total mutation 418 360 10,908 10,080 Deferred tax assets
17. Amounts receivable after more than one year
Nil. Financial section
18. Inventories
2008 2007
Raw materials 2,477 1,988
Work in progress 2,250 867
Finished goods 3,522 2,683
Goods purchased for resale 262 174
Inventories Total 8,511 5,712
19. Trade and other receivables
2008 2007
Trade receivables 22,131 19,795
Impairment losses on trade receivables -1,773 -1,410
Other receivables 4,818 5,506
Impairment losses on other receivables -501 -376
Receivables Deferred charges and accrued income 3,727 4,063
Total 28,402 27,578
135
Duvel Moortgat NV strategically decided to fully take over control of the distribution of Duvel and | Maredsous in the US, since Duvel Moortgat is convinced that its recurring margin on the present volumes
can increase considerably due to returns to scale. Therefore, a contract has been concluded with the present importer. In the deferred charges and accrued income, an amount of € 984,000 has been booked, to be booked in the results over a period of 4 years (pay-back period).
Like this, Duvel Moortgat NV strategically decided to fully take over the distribution of Brasserie d’Achouffe Duvel Moortgat Duvel products in the US, since Duvel Moortgat is convinced that its recurring margin on the present volumes can 2008 increase considerably due to returns to scale. Therefore, a contract has been concluded with the present importer for the West Coast. In the deferred charges and accrued income, an amount of € 340,000 has been booked, to be booked in the results over a period of 4 years (pay-back period). annual report Cr e d i t m a n a g e m e n t The carrying amount of the financial assets represents the maximum credit risk. For 2008: € 57.4 million, for 2007: € 53.4 million. As per 31 December 2008 and 31 December 2007, the group had no concentration of credit risks.
The aging of trade receivables is as follows:
2008 2007
Not past due 15,073 11,420
Past due 0 and 30 days 4,655 4,574
Past due 30 and 90 days 1,199 2,714 Aging More than 90 days 1,204 1,087
Total 22,131 19,795
Of the € 2.4 million loans to customers, stated in the item “other receivables”, € 48.000 is past due as per 31 December 2008.
Of the € 2.9 million loans to customers, stated in the item “other receivables”, € 127.000 is past due as per 31 December 2007.
The movements in the impairment is illustrated as follows:
Trade receivables Other receivables Total 2008 2007 2008 2007 2008 2007
Balance as per 1/1 1,410 1,223 376 1,011 1,786 2,234 Increase in provision 439 288 280 59 719 347 Decrease in provision -50 -121 -155 -694 -205 -815 Exchange differences -26 20 0 0 -26 20 Balance as per 31/12 1,773 1,410 501 376 2,274 1,786 impairment Movements in
The impairment is stated if the recoverable amount on balance date is lower than the nominal value. These impairments are determined individually. A credit insurance has been concluded that covers the main debtor risks. Financial section
20. Cash and cash equivalents
2008 2007
Term deposits over 8 years 1,000 1,000
Term deposits (< 1 month) 12,554 14,968
Bank balances 16,436 12,915
Cash 28 49
equivalents Total 30,018 28,932 Cash and cash The term deposit over 8 years is a “tak 26” investment that can be called free of charge every three months. It has been entered into at the end of December 2005.
The other deposits are short term deposits. The weighted average interest rate in 2008 amounted to 3.899%.
21. Capital and reserves
21.1 Hi s t o r y o f s h a r e c a p i t a l 137 Date Nature of transaction Number of shares Share capital (in €)
12/03/1931 Incorporation 5,000 123,947 |
29/12/1952 Capital increase by incorporation of reserves - 128,905
26/03/1999 Share split of outstanding shares by 1000 5,000,000 -
21/06/1999 Capital increase in cash 341,390 12,394,676 History of
16/12/2005 Capital increase by exercising warrants 12,120 28,698 share capital share 19/06/2006 Capital increase by exercising warrants 8,520 20,174
26/06/2007 Capital increase by exercising warrants 4,000 9,480 Duvel Moortgat Duvel Total 5,366,030 12,705,880 2008
In 2008, there was no change in capital. annual report 21.2 Sh a r e h o l d e r s t r u c t u r e a s p e r 31/03/09
% of the total number % of the total Shareholder Information per number of shares (non-diluted) number (diluted) (*)
Fibemi 01/09/08(1) 3,438,624 64.08% 64.00% Veerle Baert 07/04/2004(2) 546,291 10.18% 10.17% Other family shareholders 07/04/2004(2) 37,709 0.70% 0.70% Sinvest 07/04/2004(2) 16,000 0.30% 0.30% Treasury shares 125,333 2.34% 2.33% Employees 3,563 0.07% 0.07% Public 1,198,510 22.34% 22.31% Total 5,366,030 100% Shareholder structureShareholder (*) dilution c a l c u l a t e d b a s e d o n 7 200 a t t r i b u t e d a n d exercisable w a r r a n t s a s p e r 31 De c e m b e r 2008. t h e r e a r e n o attributable a n d /o r exercisable w a r r a n t s o t h e r t h a n t h e s e 7 200 w a r r a n t s . (1) s i t u a t i o n o n 1/09/2008 b a s e d o n t h e n o t i c e FIBEMI m a d e w i t h r e g a r d t o t h e transitional a r r a n g e m e n t r e s u l t i n g f r o m a r t i c l e 29 o f t h e transparency legislation . (2) b a s e d o n t h e transparency s t a t e m e n t m a d e o n t h a t d a t e .
Legal information in conformity with Article 15 and in conformity with the transitional arrangement resulting from Article 29 of the Transparency Legislation (Law 02/05/07 – BS 12/06/07)
Basic information Total capital 12,705,880 € Total number of voting shares 5,366,030 Total number of shares (= denominator) 5,366,030
Additional information Outstanding warrants 7,200 Total number of voting rights that can be obtained when warrants are excercised 7,200
The statutory threshold is 3% in conformity with Article 8 of the Company’s Articles of Association.
Duvel Moortgat received a notice regarding the transitional arrangement resulting from Article 29 of the Transparency Legislation. This notice states that on 1 September 2008, Fibemi NV holds 3,438,624 Duvel Moortgat voting shares. Based on the denominator of 5,366,030 voting shares on the same date, this participation equals 64,08%. Fibemi, a “stichting administratiekantoor” following Dutch Law, in turn controls Fibemi NV. Lema NV, Bemo NV and LP Invest NV each hold 1/3 of the certificates of “Stichting Administratiekantoor Fibemi” and jointly control this “Administratiekantoor”. Michel Moortgat controls Lema NV, Bernard Moortgat controls Bemo NV and Philippe Moortgat controls LP Invest NV.
Duvel Moortgat received a notice regarding the transitional arrangement resulting from Article 29 of the Transparency Legislation. This notice states that on 1 September 2008, Insinger de Beaufort Asset Management NV holds 184,663 Duvel Moortgat voting shares. Based on the denominator of 5,366,030 voting shares on the same date, this participation equals 3.44%. Financial section
Duvel Moortgat received a notice regarding the purchase or transfer of shares of Insinger de Beaufort Asset Management NV. This notice states that the participation dropped below the 3% statutory threshold on 27/10/2008.
21.3 Tr e a s u r y s h a r e s
The Group acquired 46,197 treasury shares in the pas financial year. On 31/12/2008, the total portfolio of treasury shares amounts to 81,163 shares with a total value of € 2,442,742. These shares represent 1.5% of the share capital and are deducted from the equity. In the statuary annual report of Duvel Moortgat nv, according to the regulations concerned, an extraordinary reserve not available for distribution was stated to the amount of € 2,442,742.
21.4 Di v i d e n d s The following dividend payment has been proposed by the Board of Directors after balance sheet date:
Per share € Total €
Net dividend per share 0.75 3,930,523
Withholding tax 25/75 0.25 1,310,174
Gross dividend per share 1.00 5,240,697 139
Pay out ratio 43.04% Dividend |
Aandelen
Number of shares 5,366,030
Number of treasury shares as per 31/03/09 (125,333)
Number of shares entitled to dividend payment 5,240,697
Should this proposal be approved, the net dividend of € 0.75 per share will be payable from 18 May 2009 Duvel Moortgat Duvel (payment date) onwards at Fortis Bank and Dexia Bank (payment agents) and Bank Degroof (primary 2008 payment agent) on presentation of coupon no. 10. The coupons of own shares (125,333 shares) are destroyed.
In 2008, the gross dividend over 2007 to the amount of € 4,264,851 was paid out. The gross divided per
share amounted to € 0.80. annual report
21.5 Ea r n i n g s p e r s h a r e See note 9 22. Interest bearing loans and borrowings
22.1 Am o u n t s p a y a b l e a f t e r m o r e t h a n 1 y e a r
Interest bearing 2008 2007
loans with credit institutions 19,986 18,343
Total 19,986 18,343
Other debts
Subordinated loan 238 259
Trade payables 524 550
Amounts payable Amounts payable Consigned packaging 12,344 11,394
Total 13,106 12,203 after more than 1 year after more than
The ‘loans with credit institutions’ of € 20 million mainly consists of the following:
A € 8.3 million loan contracted with regard to the bottling plant investment on 10/12/2002. A reimbursement on this loan amounting to € 4.5 million has taken place. In 2009 a following instalment of € 1.8 million will be reimbursed. This loan was contracted at an interest rate that is revised yearly. This rate amounted to 3.801% in 2008.
A € 12 million loan contracted with regard to the brewery hall investment and the purchase of the Brasserie d’Achouffe. On 25/10/2007, this loan was taken out completely. In 2008, € 0.2 million was reimbursed. In 2009 also, € 0,2 million will be reimbursed. This loan was contracted at an interest rate that is revised yearly. This rate amounted to 5.254% in 2008.
A € 3 million loan also contracted with regard to the brewery hall investment and the purchase of the Brasserie d’Achouffe. On 31/12/2006, this loan was fully withdrawn. Of this loan, € 1 million is reimbursed. An additional reimbursement of € 0.5 million will take place in 2009. This loan was contracted at an interest rate that is revised quarterly. The average rate amounted to 5.37% in 2008.
A € 4.5 million loan was contracted on 4/07/2008 for the purchase of the Liefmans assets. In 2009, € 0.64 million will be reimbursed. This loan was contracted at an interest rate that is revised half-yearly. In 2008, this rate amounted to 5.765%. Financial section
Due to a change of 100 base points in the interest rate as per report date, the results should have increased or decreased by € 229,000 (2007: € 192,000). It is assumed that all other variables, notably the exchange rates, remain constant. The analysis was carried out for 2007 based on the same assumptions.
Consigned packaging € 12.3 million (2007: € 11.4 million).
Consigned packaging is billed to the clients and stated at the client balance on the one hand, and on the liabilities balance on the other hand. In the ongoing trade relation, delivered and returned packaging is billed on each occasion. That way, the initial consignment remains permanent on the liabilities balance until all packaging should be taken back as a result of closing-down, for example. In going concern, we consider this a long-term debt, an amount we actually never pay back.
22.2 Am o u n t s p a y a b l e w i t h i n o n e y e a r
Interest bearing 2008 2007
Loans with credit institutions 4,242 3,734
141 | within one year
Amounts payable Amounts payable 22.3 Te r m s a n d d e b t r e p a y m e n t s c h e d u l e
contractual 2007 Carrying amount cash flows 1 year or less 2 to 5 years More than 5 years
Subordinated loans 259 259 0 0 259
Interest bearing loans with credit institutions 22,077 28,937 4,613 10,239 14,085 Trade payables 14,055 14,055 14,055 0 0
Other payables 811 811 811 0 0 Moortgat Duvel Total 37,202 44,062 19,479 10,239 14,344 2008
Terms and debt Terms contractual 2008 Carrying amount cash flows 1 year or less 2 to 5 years More than 5 years repayment schedule repayment Subordinated loans 237 237 0 0 237
Interest bearing loans with credit institutions 24,228 31,470 5,281 11,567 14,622 annual report Trade payables 13,513 13,513 13,513 0 0 Other payables 2,536 2,536 2,536 0 0 Total 40,514 34,243 20,292 8,296 11,927 22.4 Se n s i t i v i t y a n a l y s i s e x c h a n g e r i s k s
The group runs a transactional exchange risk on position resulting from the sales or purchases and from outstanding loans with group partnerships in other currencies than the group currency (EUR).
The group’s exposure to the transactional exchange risk was as follows:
2008 2008 2008 2007 2007 2007
Euro USD GBP Euro USD GBP
Loans 5,027 2,154 3,314 5,571 2,047 2,994 Trade receivables 3329 4,632 0 2,298 3,368 0 Cash and cash equivalents 4876 6,780 4 2,747 3,995 21
A 10 percent increase of foreign currencies with respect to the group currency (EUR) would have increased (decreased) the results with € 1,366,000 (2007: € 1,072,000). It is assumed that all variables, notably the interest rates, remain constant. The analysis was carried out for 2007 based on the same assumptions.
The group is running an exchange risk due to the consolidation of foreign partnerships that do not have the EUR as group currency.
A 10 percent increase (decrease) of foreign currencies with respect to the group currency (EUR) would have increased (decreased) the results with € 241,000 (2007: € 53,000), and would have decreased (increased) the capital with € 312,000 (2007: € 315,000). It is assumed that all variables, notably the interest rates, remain constant. The analysis was carried out for 2007 based on the same assumptions.
23. Fair value
The fair value is not substantially different from the carrying amount of the various financial assets and liabilities.
The fair value of the trade and other receivables and of the non-derivate financial liabilities is calculated based on the cash values of future cash flows, which are in their turn discounted at market rate as per end of the financial year. Financial section
24. Employee benefits
24.1 Pr o v i s i o n f o r e a r l y retirements
2008 2007
Balance at 1 January 446 571
Provisions made during the year 50 -39
Provisions reversed during the year -93 -86
Balance at 31 December 403 446 Provision for A provision for early retirement has been recognized for employees who join the system. In the course of early retirements early 2008, a provision was recognized for 1 worker and 1 office worker.
24.2 De f i n e d c ontribution p l a n s The Group has a number of defined contribution plans in different countries with external insurance companies. The contributions to these plans are funded by payments from employees and the respective Group companies. Contributions to defined contribution plans are recognized as an expense in the income statement as incurred.
24.3 Wa r r a n t s 143 The Extraordinary General Meeting of 26 March 1999 created a warrant plan, in which 250,000 warrants can be issued that entitle the right to subscribe to the same amount of shares. The warrants have a maximum | exercise period of ten years starting as of the issue date. The warrants are issued free of charge and cannot
be exercised before expiration of the third calendar year following the year the warrants were issued. The 20,640 warrants issued in 1999 can be exercised at a price of € 21.57 and, in the meantime, have all been exercised in the course of 2005 and 2006. In 2005, 11.200 new warrants were issued that can be exercised to a price of € 25.54.In 2007, 4,000 of theses warrants were exercised. Duvel Moortgat Duvel Within this plan, no further warrants shall be issued given that they are no longer exercisable before the end 2008 of the duration of the plan. annual report 25. Provisions
Contractual obligation Soil sanitation Total 2008 2007 2008 2007 2008 2007
Balance at 1 January 235 308 124 124 359 432 Provisions made during the year 47 0 0 0 47 0 Provisions used during the year 72 73 0 0 72 73 Provisions reversed during the year 0 0 0 0 0 0 Balance at 31 December 210 235 124 124 334 359 Provisions
The Group is not involved in any significant lawsuits other than current disputes relating to normal business activities (e.g. disputes relating to unpaid rent and trade debts, etc.).
26. Trade and other payables
2008 2007
Trade payables 13,513 14,055
Social security payables 1,700 2,085
Other payables 2,536 811
Accrued charges and deferred income 2,466 1,596
Trade and Trade Total 20,215 18,547 other payables other
In the heading ‘other payables’, a discounted amount of € 765,000 has been booked for the future estimated payments concerning the purchase of Brasserie d’Achouffe.
27. Renting and operating leases
Re n t a s t e n a n t The Group rents buildings, machines and vehicles. The rent is payable as follows:
2008 2007
within one year 1,532 1,343
within one to five years 4,056 3,661
after five years 1,486 1,473 Renting and operating leases Financial section
In the course of the financial year 2008, € 1,948,000 was booked as rent (2007: € 2,009,000).
Re n t a s l e t t e r The Group lets its investment property (see explanation 13). The future minimum rents to be received are as follows:
2008 2007
within one year 1,814 1,756
within one to five years 8,954 8,668
after five years 5,440 5,267 Rent as letter In the course of the financial year 2008, € 1,814,000 was booked as rental income (2007: € 1,756,000). With regard to maintenance and renovation of property investments, in the course of the financial year 2008, € 112,000 was booked as costs. (2007: € 72,000).
28. Contingencies
There are no contingencies not reflected in the balance sheet. No collateral commitments for credits have 145 been made, only a negative pledge has been given. |
29. Capital commitments
At the end of 2008, all investments commitments have been started.
30. Related parties Moortgat Duvel 2008
The controlling shareholder is Fibemi, who, in turn, is controlled by the Moortgat family.
No other transactions have taken place between the joined parties other than those who are explicitly
explained. annual report
The remuneration paid to the executive directors, Lema nv as CEO of Duvel Moortgat and Bemo nv as executive director of Moortgat Immo Services, amounted to € 478,871. This includes the variable part ad € 49,641. The total remuneration paid to the non-executive directors amounts to € 135,200.
The total amount of salaries paid to the directors relating to activities for the consolidating company, its subsidiaries and associates amounted to € 614,071. This amount is stated in the section “services and other goods”.
The global remuneration paid to the management committee amounted to € 729,148. The variable part amounted to € 130,918. The other components amounted to € 7,979.
No extraordinary or deviant compensation regulations have been arranged. All regulations are in accordance with the market.
No pensions or other amounts are paid to former directors or business managers on that account.
In the course of 2008, no shares or warrants were granted to the CEO or the members of the management committee.
All transactions between the different Group companies are at arm’s length.
31. Subsequent events
On 15 December 2008, the ‘convention de cession de parts sociales’ of the Hotel de la Vallée des Fées was signed. The payment and transfer of the shares took place on 30 January 2009. The hotel activities were terminated at the end of 2008. This former hotel is a part of the Brasserie d’Achouffe site and will be converted into a visitor centre, seminar and training location, amongst others.
On 17 March 2009, the buildings of the Liefmans brewery in Oudenaarde were acquired for the price of € 1,650,000, in implementation of the agreement concluded with the curators on 24 June 2008.
These events do not impact the actual position of the company for the financial year 2008.
The Group is not aware of any other important events that could influence the financial statements closed on 31 December 2008. Financial section
7. Declaration by the issuer’s persons responsible.
Duvel Moortgat declares that, to its knowledge: a) the annual accounts, drawn up in accordance with the applicable standards for annual accounts, give a true and fair presentation of the equity, financial situation and the results of Duvel Moortgat and of the consolidated companies; b) that the annual financial report gives a true and fair presentation of the development and results of Duvel Moortgat and of the consolidated companies, along with a description of the main risks and uncertainties they face.
Michel Moortgat CEO
Herbert De Loose CFO
8. Abbreviated statutory accounts of Duvel Moortgat NV 147 The statutory accounts of the parent company, Duvel Moortgat NV, are presented below in abbreviated version. In compliance with article 98 of the Belgian Company Code, the annual accounts, report of | the Board of Directors and the statutory auditor’s report are filed with the Belgian National Bank. These documents are available free of charge upon simple request at the Company’s registered office. They will also be available at the Company’s web site. The statutory auditor’s report on the annual accounts was unqualified. Duvel Moortgat Duvel 2008 annual report Liabilities Assets I Start-up expenses I Start-up II Intangible assets II Intangible III Property, plantandequipment IV Financial assets VI Inventories VII Amountsreceivable withinoneyear VIII Short-term investments VIII Short-term IX Cash X Deferred charges andaccruedincome NON-CURRENT ASSETS I Issuedcapital II Share premium CURRENT ASSETS IV Reserves V Retained earnings V Retained VI Investment grants VII AAmountspayable oneyear after VII BDeferred taxliabilities TOTAL ASSETS EQUITY VIII Amountspayable oneyear after IX Amountspayable withinoneyear X Accrued charges anddeferred income PROVISIONS AND DEFERRED TAXES PAYABLES TOTAL LIABILITIES in thousand€ 134,471 134,471 91,420 45,769 43,770 43,051 22,572 11,745 80,690 12,706 20,223 47,272 53,092 29,052 22,752 1,881 2,893 4,857 1,288 2008 984 489 689 527 162 0 0 in thousand€ 123,394 123,394 86,511 42,862 43,276 36,883 19,768 74,882 12,706 20,253 41,434 47,766 27,137 20,037 2,333 4,494 9,108 1,180 2007 373 489 746 569 177 592 0 0 in thousand€ 107,835 107,835 76,237 33,796 42,065 31,598 18,732 69,412 12,696 19,602 36,714 37,575 20,952 16,225 1,505 3,998 6,684 2006 376 679 396 848 695 153 398 0 4 Financial section
2008 2007 2006
in thousand € in thousand € in thousand €
I Operating revenue 85,918 75,976 69,989
II Operating expenses -71,875 -60,819 -56,658
III Operating profit before financing costs 14,043 15,157 13,331
IV Financial income 3,817 857 696
V Financial expenses -2,895 -2,087 -1,274
VI Profit on ordinary activities before tax 14,965 13,927 12,753
VII Exceptional income 0 0 0 Income statement VIII Exceptional expenses 0 0 0
IX Profit for the period before tax 14,965 13,927 12,753
IX bis A Transfer from deferred taxes 16 16 16
IX bis B Transfer to deferred taxes 0 -40 -2
X Income tax expense -3,932 -4,267 -3,933
XI Profit of the year 11,049 9,636 8,834
XII Transfer from tax-exempt reservess 30 27 26
Transfer to tax-exempt reserves 0 -677 -305
XIII Profit for the period available for appropriation 11,079 8,986 8,555
A Profit available for appropriation 52,513 45,700 40,551
1 Profit for the period available for appropriation 11,079 8,986 8,555 149
2 Profit brought forward from previous financial year 41,434 36,714 31,996 |
B Withdrawal from shareholders’ equity 0 0 0
2 To reserves 0 0 0
C Transfers to shareholders’ equity 0 1 2
Appropriation of profit 2 To legal reserves 0 1 2
3 To other reserves 0 0 0 Moortgat Duvel 2008
D Retained earnings 47,272 41,434 36,714
1 Retained earnings 47,272 41,434 36,714
E Profit to be distributed 5,241 4,265 3,835 annual report 1 Dividends to shareholders 5,241 4,265 3,835 9. Summary of accounting policies of Duvel Moortgat NV
A. PRINCIPLE The accounting policy is determined in accordance with the stipulations of the Royal Decree of 30 January 2001 on the implementation of the Code of Companies.
All items are valued at nominal value, unless otherwise stipulated.
B. SPECIAL REGULATIONS Preliminary flotation The preliminary flotation is valued at their purchase or deposit value and depreciated according to the linear method at a rate of 20%.
Intangible assets These assets are valued at their purchase or deposit value and depreciated according to the linear method at a rate of 20%.
Property, plant and equipment Property, plant and equipment are valued at purchase value. Additional costs, other than the additional costs on industrial buildings, are completely depreciated in the year that they are purchased. New investments in industrial buildings and installations of the production equipment are depreciated degressively as of the financial year 1996. The other depreciations are calculated according to the linear method based on the expected life span of these assets. The percentages used fluctuate from 2% to 33%. The year of implementation is depreciated pro rata temporis.
Financial assets Participations are valued at purchase value. Receivables on companies with whom participation relations are established, are valued at nominal value. On participations and receivables on which permanent and long-lasting net losses are established, the necessary impairments are applied. Financial section
Stocks Stocks are valued in the following manner - raw materials: at purchase price or at market value, in the case it is lower - goods being processed: at price of raw material - finished products: price of raw material + directly applicable bottling costs - commodities: at purchase price or at market value, in the case it is lower
Receivables Receivables are valued at nominal value. Impairment losses are stated if the recoverable amount on the balance sheet date is lower than the nominal value. These impairment losses are stated on a case-by-case basis.
Provisions for risks and costs Provisions are stated to cover clearly defined losses or costs that are probable or certain on the balance sheet date, but whose amount is not yet established.
Foreign currencies The monetary items of the balance sheet that are stated in foreign currencies are converted at the current closing rate as per balance sheet date. Negative conversion differences that correspond to deferred losses are stated to the account of the results. On the other hand, positive conversion differences that correspond 151 to deferred profits are stated on the liabilities of the balance sheet, in conformity with the precautionary principle. |
10. Statement of capital of Duvel Moortgat NV
Financial year Previous financial year
Issued capital at the end of the previous year 12,705,879.73 12,705,879.73 Moortgat Duvel 2008
Composition of the capitel Amounts Number of shares capital Types of shares Company Company Capital shares 12,705,879.73 5,366,030
Registered 3,375,458 annual report Bearer shares 1.990,572
Financial year
Held by the company
Capital amount 192,356.31 shares Number of shares 81,163 Treasury 11. Report by the statutory auditors
To the shareholders of Duvel Moortgat nv:
We have audited the consolidated balance sheet of DUVEL MOORGAT nv. and its subsidiaries as of 31 December 2008, as well as the consolidated income statement, cash flow statement and notes to the accounts of Duvel Moortgat for the year ended. Total assets on 31 December 2008 amounted to € 167 471 (000) and the profit for the financial year to € 12 178 (000).
Un q u a l i f i e d a p p r o v a l o f t h e c onsolidated f i n a n c i a l s t a t e m e n t s The preparation of the consolidated accounts is the responsibility of the board of directors. This responsibility implies amongst others: elaborating, implementing and maintaining an internal control with regard to elaborating a true reproduction of the consolidated accounts that do not contain any abnormalities of material interest, as a consequence of fraud or error; choosing and applying the proper basis for financial reporting; making financial estimates reasonable under the circumstances.
It is our responsibility to express our opinion on these consolidated accounts based on our audit. Our examination was carried out in accordance with the “International Standards of Auditing” of the “International Federation of Accountants”. These standards specify that our audit must be planned and conducted in such a way as to produce a reasonable assurance that the consolidated accounts are free of material misstatement, as a consequence of fraud or error.
In accordance with these standards, we have examined the Company’s administrative and accounting systems and its internal audit system. We have examined sample documents to verify the accuracy of the amounts stated in the consolidated accounts. We have also examined the soundness of the accounting policies, consolidation principles, significant accounting estimates and overall presentation of the consolidated accounts. The Company’s management has replied clearly at all times to our requests for explanations and information. We consider that these examinations provide a reasonable basis on which to form our opinion.
Based on these examinations, it is our opinion that the attached consolidated accounts give a true and fair view of the assets and liabilities and the financial situation of Duvel Moortgat nv and its subsidiaries on 31 December 2008, together with the financial achievements of their activities and their cash flow for the year ending on this same date, in accordance with the “International Financial Reporting Standards”, as published by the International Accounting Standards Board (IASB). Financial section
Ad d i t i o n a l c e r t i f i c a t i o n s The preparation and content of the financial statements is the responsibility of the board of directors.
It is my responsibility to include in this report the following additional certifications which do not modify my audit opinions on the consolidated accounts.
The financial statements for the year concluded on 31 December 2008 contain the information as required by law and are in accordance with the financial accounts. I am, however, unable to comment on the description of the principal risks and uncertainties which the group is facing, and of its situation, its foreseeable evolution or the significant influence of certain facts on its future development. I can nevertheless confirm that the matters disclosed do not present any obvious contradictions with the information of which I became aware during our audit.
The Board of directors informed you in the consolidated annual report, according to the articles 523 en 524 of the Belgian Company code, about the decisions taken with respect to the purchase (€ 419.000) and the sale (€ 300.000) of real estate, this within the scope of the conflict of interests. The legal procedure has been complied with.
Without prejudice to formal aspects of secondary importance, the consolidated annual accounts of the Duvel Moortgat Group are prepared in accordance with the International Financial Reporting Standards, 153 as published by the International Accounting Standards Board (IASB) and its interpretations issued by the International Financial Reporting Interpretation Committee (IFRIC), as adopted by the European Union. |
Duvel Moortgat Duvel 2008 Haacht, 27 March 2009, De Roover & C° Statutory Auditors bvba Commissioner Represented by
Guy De Roover annual report Statutory Auditor 12. Adressen en verdere gegevens
1 Duvel Moortgat nv Exploitatiezetel 8 Moortgat Horeca Services nv
Breendonkdorp 58 Palackého 135, 664 61 Rajhrad u Brna Breendonkdorp 58
2870 Puurs Czech Republic 2870 Puurs
Ondernemingsnummer: 0400.764.903 Tel: +420 (0) 5 472 300 31 Ondernemingsnummer: 0417.781.473
tel: +32 (0)3 860 94 00 Fax: +420 (0) 5 47229134 tel: 32 (0)3 860 94 28
fax: +32 (0)3 886 46 22 www.bernard.cz fax: 32 (0)3 860 94 29
www.duvel.com E-mail: [email protected]
E-mail: [email protected] 9 Moortgat Financial Services nv
5 Brewery Belâme ltd Breendonkdorp 58
2 Brouwerij Steendonk nv (Brewery Ommegang) 2870 Puurs
Breendonkdorp 58 656 County Highway 33 Ondernemingsnummer: 0427.447.128
2870 Puurs Cooperstown NY 13326 tel: 32 (0)3 860 94 00
Ondernemingsnummer: 0437.360.627 USA fax: 32 (0)3 886 46 22
tel: +32 (0)3 886 71 21 tel: +1 (0)607 544 1800
fax: +32 (0)3 886 46 22 fax: +1 (0)607 544 1801 10 Eura - Drinks nv
E-mail: [email protected] www.ommegang.com Breendonkdorp 58
E-mail: [email protected] 2870 Puurs
Exploitatiezetel Ondernemingsnummer: 0450.984.078
Steenhuffeldorp 3 6 Freya’s Deli Fruit nv tel: 32 (0)3 886 71 21
1840 Steenhuffel Breendonkdorp 58 fax: 32 (0)3 886 46 22
tel: +32 (0)52 30 02 17 2870 Puurs
fax: +32 (0)52 30 41 67 Ondernemingsnummer: 0450.258.657 11 Beer & Selected Beverages eesv
tel: 32 (0)3 860 94 00 Zalmweg 27
3 Rodinný Pivovar Bernard as fax: 32 (0)3 886 46 22 4941 VX Raamsdonksveer
5,kvetna 1, 396 01 Humpolec Nederland
Czech Republic 7 Brasserie d’Achouffe tel: +31 (0)162 581 100
Tel: +420 (0)565 532 407 Achouffe 32 fax: +31 (0)162 523 385
Fax: +420 (0)565 532 183 6666 Wibrin - Houffalize [email protected]
www.bernard.cz Ondernemingsnummer: 0429.312.102
E-mail: [email protected] tel: 32 (0)61 28 81 47 - 32 (0)61 28 82 78 12 Duvel Moortgat France sarl
fax: 32 (0)61 28 82 64 35 Chemin du Mas
4 Sladovna Bernard as www.achouffe.be F 69370 Saint-Didier au Mont d’or
5,kvetna 1, 396 01 Humpolec E-mail: [email protected] Frankrijk
Czech Republic tel: +33 (0)437 59 82 30
Tel: +420 (0)565 532 407 fax: +33 (0)478 66 15 65
Fax: +420 (0)565 532 183 www.duvel.com
www.bernard.cz E-mail: [email protected]
E-mail: [email protected] 16 15 14 13 E-mail: [email protected] fax: +33(0)321793938 tel: +33(0)321793934 Frankrijk F 62410Bénifontaine 13 ruePasteur Force de Vente Service E-mail: [email protected] www.barmusichall.com fax: +44(0)2077293893 tel: +44(0)2077297216 Verenigd Koninkrijk EC2A 3AR Shoreditch ,London Road 134 -146Curtain Ltd (UK) Belgabar E-mail :[email protected] fax: +33(0)321793938 tel: +33(0)3217939 Frankrijk F 62410Bénifontaine 13 ruePasteur Groupement Bières SpécialesGeie E-mail: [email protected] www.duvelusa.com fax: +16075441801 tel: +16075441208 USA Cooperstown, NY13326 Avenue21 Railroad #32 USA,LtdDuvel Moortgat 20 19 18 17 fax: +352(0)227347 tel: +352(0)2273431 Luxembourg L -1253Luxembourg Bové 2, RueNicolas DRC sa [email protected] E-mail: fax: +86(0)2162557920 tel: +86(0)2162557919 PR China 200040 Shanghai Xinzha Lu 1508,5A01 ShanghaiLtdDuvel Moortgat Hong Kong Road,3 Garden Central ICBC Tower, Citibank Plaza, 21F HongKongDuvel Ltd Moortgat [email protected] E-mail: fax: +44(0)2077293893 tel: +44(0)2077297216 Verenigd Koninkrijk EC2A 3AR Shoreditch ,London Road 134 -146Curtain Exploitatiezetel Verenigd Koninkrijk London EC2A2BU 62 Wilson Street UKLtdDuvel Moortgat 21 24 23 22 E-mail: www.lesfreresberthom.com fax: +33(0)383302321 tel: +33(0)383302320 Frankrijk F 54000Nancy 8 RuedesJardiniers LFB Développement sa [email protected] fax:+33 (0)473310165 tel: +33(0)473310165 Frankrijk F 63000Clermont-Ferrand 6-8 Place del’Etoile L’étoileSarl LFB Clermont-Ferrand fax: +33(0)388322762 tel: +33(0)388328118 Frankrijk F 67000Strasbourg 2 Place des Tripiers LesSarl Tripiers LFB Strasbourg fax: +33(0)383302321 tel: +33(0)383302320 Frankrijk F 54000Nancy 8 RuedesJardiniers LFB Expansionsas Financial section 155
annual report 2008 Duvel Moortgat | 25 LFB Tours 29 Moortgat Immo Services nv
Sarl Comtours Breendonkdorp 58
5 Rue du commerce 2870 Puurs
F 37000 Tours Ondernemingsnummer: 0451.342.285
Frankrijk tel: +32 (0)3 886 71 21
tel: +33 (0)2 47 20 01 66 fax: +32 (0)3 886 46 22
fax : +33 (0)2 47 20 40 04
30 Parallel nv
26 LFB Grenoble Breendonkdorp 58
Sarl Saint Hugues 2870 Puurs
1 Rue de Saint Hugues Ondernemingsnummer: 0442.713.245
F 38000 Grenoble tel: +32 (0)3 886 71 21
Frankrijk fax: +32 (0)3 886 46 22
tel: +32 (0)4 76 01 81 17
fax :+32 (0)4 76 01 96 56 31 L.D.V. Immo nv
Breendonkdorp 58
27 LFB Nancy 2870 Puurs
Sarl Stannancy Ondernemingsnummer: 0447.880.771
5 Rue Stanislas tel: +32 (0)3 886 71 21
F54000 Nancy fax: +32 (0)3 886 46 22
Frankrijk
tel: +32 (0)3 83 48 57 50 32 Espace Belge à Paris Geie
fax :+32 (0)3 83 31 66 48+B70 Steenhuffeldorp 3
1840 Steenhuffel
28 LFB Lyon tel: +32 (0)52 30 94 81
Sarl Fousseretlyon fax: +32 (0)52 30 41 67
2 Place Ennemond Fousseret
F69005 Lyon 33 Duvel Moortgat Nederland
tel: +32 (0)4 78 28 44 10 Zutphenseweg 29 b
fax :+32 (0)4 78 28 43 91 7418 AH Deventer
Nederland
tel: +31 (0)570-660960
Fax:+31 (0)570-625202 Duvel Moortgat nv
Breendonkdorp 58 2870 Puurs | België
T +32 (0)3 860 94 00 F +32 (0)3 886 46 22 email: [email protected]
website: www.duvel.com 081730 - www.lannooprint.be