Notes to the company financial statements

1. Summary of significant accounting policies

1.1 Basis of preparation

The company financial statements of Royal BAM Group nv (‘the Company’ or ‘BAM’) have been prepared in accordance with Part 9, Book 2 of the Netherlands Civil Code. In accordance with subsection 8 of section 362, Book 2 of the Netherlands Civil Code, the recognition and measurement principles applied in these parent company financial statements are the same as those applied in the consolidated financial statements (see note 2 to the consolidated financial statements).

As a result of a change in section 402, Book 2 of the Netherlands Civil Code, the income statement in the company financial statements is no longer condensed. BAM has included the full income statement and other additional notes resulting from this change, including the comparative figures.

1.2 Investments in subsidiaries

Investments in subsidiaries are measured at net asset value. The net asset value is calculated using the accounting policies, as described in note 2 to the consolidated financial statements. The net asset value of subsidiaries comprises the cost, excluding goodwill, of BAM’s share in the net assets of the subsidiary, plus BAM’s share in income or losses since acquisition, less dividends received. 

2. Property, plant and equipment

 

Land and
buildings

 Other
assets

Total

As at 1 January 2015

     

Cost

 16,360 

 14,846 

 31,206 

Accumulated depreciation and impairments

 (4,030)

 (9,946)

 (13,976)

 

 12,330 

 4,900 

 17,230 

       

Additions

 1,649 

 6,654 

 8,303 

Disposals

 (350)

 (567)

 (917)

Depreciation charges

 (854)

 (2,989)

 (3,843)

Impairment charges

 (763)

 - 

 (763)

 

 (318)

 3,098 

 2,780 

       

As at 31 December 2015

     

Cost

 16,896 

 17,076 

 33,972 

Accumulated depreciation and impairments

 (4,884)

 (9,078)

 (13,962)

 

 12,012 

 7,998 

 20,010 

       

Additions

 - 

 3,497 

 3,497 

Disposals

 (11,468)

 (1,296)

 (12,764)

Depreciation charges

 (544)

 (3,172)

 (3,716)

Impairment charges

 - 

 - 

 - 

 

 (12,012)

 (971)

 (12,983)

       

As at 31 December 2016

     

Cost

 - 

 18,109 

 18,109 

Accumulated depreciation and impairments

 - 

 (11,082)

 (11,082)

 

 - 

 7,027 

 7,027 

3. Intangible assets

 

Goodwill

Non-
integrated
software

Other

Total

As at 1 January 2015

       

Cost

 532,467 

 1,724 

 - 

 534,191 

Accumulated amortisation and impairments

 (155,731)

 (1,182)

 - 

 (156,913)

 

 376,736 

 542 

 - 

 377,278 

         

Additions

 - 

 375 

 - 

 375 

Amortisation charges

 - 

 (332)

 - 

 (332)

Exchange rate differences

 9,377 

 - 

 - 

 9,377 

 

 9,377 

 43 

 - 

 9,420 

         

As at 31 December 2015

       

Cost

 541,844 

 2,099 

 - 

 543,943 

Accumulated amortisation and impairments

 (155,731)

 (1,514)

 - 

 (157,245)

 

 386,113 

 585 

 - 

 386,698 

         

Additions

 - 

 - 

 883 

 883 

Disposals

 (1,357)

 - 

 - 

 (1,357)

Amortisation charges

 - 

 (335)

 (66)

 (401)

Exchange rate differences

 (22,915)

 - 

 - 

 (22,915)

 

 (24,272)

 (335)

 817 

 (23,790)

         

As at 31 December 2016

       

Cost

 518,929 

 2,099 

 883 

 521,911 

Accumulated amortisation and impairments

 (157,088)

 (1,849)

 (66)

 (159,003)

 

 361,841 

 250 

 817 

 362,908 

4. Financial assets

 

Shares in
subsidiaries

Receivables
from
subsidiaries

Other
participating
interests

Other loans
and
receivables

Total

           

As at 1 January 2015

 847,306 

 621,147 

 1,543 

 125 

 1,470,121 

Net result

 29,116 

 - 

 - 

 

 29,116 

Dividends

 (3,595)

 - 

 - 

 - 

 (3,595)

Additions

 - 

 - 

 368 

 - 

 368 

Reclassifications

 24,068 

 (24,068)

 - 

 - 

 - 

Capital contributions

 21,000 

 - 

 - 

 - 

 21,000 

Loans granted and repayments

 - 

 (3,224)

 - 

 (125)

 (3,349)

Cash flow hedge

 2,932 

 - 

 - 

 - 

 2,932 

Remeasurements of post-employment
benefit obligations

 35,405 

 - 

 - 

 - 

 35,405 

Exchange rate differences

 16,866 

 - 

 - 

 - 

 16,866 

As at 31 December 2015

 973,098 

 593,855 

 1,911 

 - 

 1,568,864 

           

Net result

 46,487 

 - 

 9,684 

 - 

 56,171 

Dividends

 (80,311)

 - 

 - 

 - 

 (80,311)

Additions

 - 

 - 

 180 

 - 

 180 

Disposals

 (510)

 - 

 - 

 - 

 (510)

Reclassifications

 33,372 

 (33,372)

 (9,684)

 - 

 (9,684)

Capital contributions

 55,266 

 - 

 - 

 - 

 55,266 

Loans granted and repayments

 - 

 136,446 

 - 

 - 

 136,446 

Cash flow hedge

 (2,130)

 - 

 - 

 - 

 (2,130)

Remeasurements of post-employment
benefit obligations

 (54,299)

 - 

 - 

 - 

 (54,299)

Exchange rate differences

 (42,756)

 - 

 - 

 - 

 (42,756)

As at 31 December 2016

 928,217 

 696,929 

 2,091 

 - 

 1,627,237 

None of the financial assets were subject to impairment.

A list of the principal subsidiaries is disclosed in section Other information.

5. Deferred tax assets

 

2016

2015

     

Deferred tax assets

185,457

 188,649 

 

185,457

 188,649 

Deferred tax assets include the liquidation of old property development activities in Germany and the tax loss carry-forwards of the operations in the Netherlands to the extent that the realisation of the related tax benefit
through future taxable profits is probable offset against deferred tax liabilities.

Additional information on deferred tax assets and liabilities is disclosed in note 22 to the consolidated financial statements.

6. Receivables

 

2016

2015

     

Amounts due from subsidiaries

22,495

 27,685 

Social security and other taxes

-

 544 

Prepayments and accrued income

10,787

 16,203 

 

33,282

 44,432 

     

Receivables are due within one year.

   

7. Cash and cash equivalents

 

2016

2015

     

Cash at bank

53,025

 16,312 

 

53,025

 16,312 

     

Cash and cash equivalents are at the free disposal of the Company.

   

8. Equity attributable to shareholders of the Company

At year-end 2016, the authorised capital of the Group was 400 million ordinary shares (2015: 400 million) and 600 million preference shares (2015: 600 million), all with a nominal value of €0.10 per share (2015: €0.10 per share).
All issued shares have been paid in full.

Movements in the number of ordinary shares are as follows:

 

Number of
ordinary shares

Number of
treasury shares

Number of
ordinary shares
in issue

       

As at 1 January 2015

 270,998,957 

-

 270,998,957 

Repurchased shares

 - 

 604,975 

 (604,975)

As at 31 December 2015

 270,998,957 

 604,975 

 270,393,982 

       

Repurchase of ordinairy shares

 - 

 588,170 

 (588,170)

Dividends

 815,771 

 - 

 815,771 

As at 31 December 2016

 271,814,728 

 1,193,145 

 270,621,583 

Movements in shareholders’ equity are as follows:

 

Attributable to the shareholders of the Company

 

Issued
and paid
capital

Share
premium

Reserves

Retained
earnings

Net result

Total

             

As at 1 January 2015

 27,099 

 812,212 

 (134,873)

 231,128 

 (108,172)

 827,394 

             

Net result for the year

 - 

 - 

 - 

 - 

 10,180 

 10,180 

Appropriation of result

 - 

 - 

 - 

 (108,172)

 108,172 

 - 

Remeasurements of post-employment benefit obligations

 - 

 - 

 - 

 37,026 

 - 

 37,026 

Cash flow hedges

 - 

 - 

 4,094 

 - 

 - 

 4,094 

Repurchase of ordinary shares

 - 

 - 

 - 

 (3,092)

 - 

 (3,092)

Share-based payments

 - 

 - 

 - 

 302 

 - 

 302 

Exhange rate differences

 - 

 - 

 26,243 

 - 

 - 

 26,243 

As at 31 December 2015

 27,099 

 812,212 

 (104,536)

 157,192 

 10,180 

 902,147 

             
             
             

Net result for the year

 - 

 - 

 - 

 - 

 46,831 

 46,831 

Appropriation of result

 - 

 - 

 - 

 10,180 

 (10,180)

 - 

Issue of convertible bonds

 - 

 - 

 - 

 7,852 

-

 7,852 

Dividends

 82 

 (82)

 - 

 (1,978)

 - 

 (1,978)

Remeasurements of post-employment benefit obligations

 - 

 - 

 - 

 (53,226)

 - 

 (53,226)

Cash flow hedges

 - 

 - 

 (45)

 - 

 - 

 (45)

Repurchase of ordinary shares

 - 

 - 

 - 

 (2,529)

 - 

 (2,529)

Share-based payments

 - 

 - 

 - 

 606 

 - 

 606 

Exhange rate differences

 - 

 - 

 (65,671)

 - 

 - 

 (65,671)

Other

-

-

-

 263 

-

 263 

As at 31 December 2016

 27,181 

 812,130 

 (170,252)

 118,360 

 46,831 

 834,250 

Due to a change in accounting policy, the remeasurements of post-employment benefits are no longer included in the reserves, but have been restated to the retained earnings. The comparative figures have been adjusted accordingly.

8.1 Reserves

Reserves relate to the reserves for (cash flow) hedging, remeasurements of post-employment benefits and translation differences. The reserves for (cash flow) hedging and translation differences are legal reserves that are required by Dutch law. Distributions to the shareholders of the Company are restricted to the extent of the balance.

The hedging reserve amounts to €77 million negative (2015: €77 million negative) and the translation reserve €93 million negative (2015: €27 million negative).

For a further breakdown of the reserves see note 16 in the Consolidated statements.

8.2 Dividends per share

The Company proposes to declare a dividend over the financial year 2016 of 9 eurocents in cash per ordinary share or in shares, at the option of the shareholders (2015: 2 eurocents). Based on the number of ordinary shares outstanding at year-end 2016, a maximum of €24.3 million will be distributed as dividend on the ordinary shares. As yet, the dividend proposal has not been deducted from retained earnings under equity.

9. Provisions

 

2016

2015

     

Employee benefits

47,339

 56,060 

 

47,339 

 56,060 

The duration of the provisions is more than one year. Provisions with a duration less than one year are included in current liabilities.

10. Borrowings

 

2016

2015

     

Subordinated convertible bonds

112,491

 - 

Subordinated loan

 - 

125,000

Other loans

 - 

7,104

 

112,491

132,104

Additional information on borrowings is disclosed in note 18 to the consolidated financial statements.

11. Current liabilities

 

2016

2015

     

Bank overdrafts

-

1,163

Subordinated loan

-

(665)

Other loans

-

926

Amounts due to subsidiaries

1,241,267

1,086,403

Provisions

82

9,647

Other liabilities

33,507

37,180

 

1,274,856

1,134,654

Provisions include a restructuring provision of €0.1 millon (2015: €1.1 million). In 2015 the provisions also included the dividend guarantee provision relating to the disposal of the interest in Van Oord (€8.5 million), which has been released in 2016.

12. Internal charges

The internal charges represent services that have been charged to the other Group Companies. 

13. Employee benefit expenses

 

2016

2015

     

Wages and salaries

 22,421 

 26,599 

Social security costs

 2,097 

 2,594 

Pension costs - defined contribution plans

 2,005 

 3,529 

Pension costs - defined benefit plans

 340 

 (2,269)

 

 26,863 

 30,453 

At year-end 2016, the Company had 225 employees in FTE (2015: 210). The average number of employees in FTE amounted to 221 (2015: 243).

14. Finance income and expense

 

2016

2015

Finance income

   

- Interest income - intercompany

 16,115 

 15,448 

- Interest income - cash at banks

 817 

 2,165 

- Interest income - other financial assets

 40 

 8 

- Dividend income

-

(8)

- Other finance income

 1,629 

 1,100 

 

 18,601 

 18,713 

     

Finance expense

   

- Subordinated convertible bonds

 3,599 

 - 

- Subordinated loan

 3,585 

 7,416 

- Bank fees - subordinated loan

 665 

 500 

- Committed syndicated credit facility

 109 

 196 

- Bank fees - committed syndicated credit facility

 3,324 

 4,688 

- Other non-recourse financing

 44 

 92 

- Interest expense - intercompany

 3,567 

 4,277 

- Interest expense - bank overdrafts

 4 

 156 

- Recourse property financing

 206 

 - 

- Other recourse financing

 986 

 681 

- Fair value result - interest rate swaps

 1,795 

-

 

 17,884 

 18,006 

     

Net finance result

 717 

 707 

Additional information on finance income and expense is disclosed in note 28 to the consolidated financial statements.

15. Related parties

The Company has entered into arrangements with a number of its subsidiaries and affiliated companies in the course of its business. These arrangements relate to service transactions and financing agreements and were conducted at market prices.

Additional information on key management compensation is disclosed in note 36 to the consolidated financial statements.

16. Commitments and contingencies

16.1 Guarantees

The Company has issued parent company guarantees amounting to €151 million (2015: €156 million) at year-end 2016.

16.2 Third-party liability

The Company is jointly and severally liable for the debts of the subsidiaries based in the Netherlands pursuant to section 403, Book 2 of the Netherlands Civil Code.

The Company, together with other participants, has a joint and several liability for deficits in the Group’s cash pool as a whole.

The Company forms a fiscal unity with BAM’s major Dutch and certain other subsidiaries for income tax and VAT purposes and, for that reason, it is jointly and severally liable for the Dutch income tax and Dutch VAT liabilities of the whole fiscal unity. 

Bunnik, the Netherlands
20 February 2017 

Supervisory Board: 
P.A.F.W. Elverding 
H. Scheffers 
J.-P. Hansen 
C.M.C. Mahieu
H.L.J. Noy
K.S. Wester

Executive Board:
R.P. van Wingerden
T. Menssen
E.J. Bax

Name

Company