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BSC Drukarnia Opakowań S.A.
BOARD REPORT ON THE ISSUER’S ACTIVITY IN 2014
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1. Information on the Issuer.
BSC Drukarnia Opakowań Spółka Akcyjna (“the Company”, ”the Issuer”, ”the Entity”) runs their business
activity as a joint-stock company set up by the notarial deed on 1 July1999 before the notary Piotr Kowanda
(Rep. No: A 8000/1999) in Poznań.
The registered office of the Company is Poznań, ulica Żmigrodzka 37. The Company is registered in Poland and
at present entered the register of entrepreneurs, run by the District Court in Poznań at the number
KRS 0000032771.
The Entity was given the CRO Certificate (REGON) number: 639627371 and received the Tax Identification
Number (NIP) 779-20-76-889.
The basic fields of the Entity’s business activity are:
Printing activity,
Supporting graphic activity,
Activity related to packing.
Entities related to the Company are the subjects being parts of the Capital Group whose parent entity is BSC
Drukarnia Opakowań S.A.
BSC Drukarnia Opakowań S.A. the Capital Group (“the Group”) consists of the parent company BSC Drukarnia
Opakowań S.A. and the subsidiary BSC Pharmacenter Sp. z o.o. (“subsidiary entity” “subsidiary company”),
where the parent company holds 100% shares.
The registered office of BSC Pharmacenter Sp. z o.o. is Poznań, ulica Żmigrodzka 37. The Company is
registered in Poland and at present entered the register of entrepreneurs, run by the District Court in Poznań at
the number KRS 0000212672.
The time period of the subsidiary’s activity is indefinite.
The financial statement of BSC Pharmacenter Sp. z o.o. was drawn up for the same reporting period as the financial statement of the parent company, with the application of consistent accounting principles.
The basic activity of the subsidiary entity involves: Printing activity,
Supporting graphic activity,
Activity related to packing.
2. Information on the personnel of the Company’s Board and Supervisory Board
In the financial period the personnel the Company’s Board was as follows: Janusz Schwark – the President of the Board,
Andrzej Baranowski - Financial Vice-President of the Board,
Arkadiusz Czysz - Commercial Vice-President of the Board.
In the analyzed period there were no changes in the personnel of the Company’s Board.
In the financial period the personnel of the Company’s Supervisory Board was as follows:
Andrzej Borowiński,
Hans Christian Bestehorn,
Henrik Kehren,
Hans Jurgen Katzer,
Stephan Bestehorn,
Marek Dietl
In the analyzed period there were no changes in the personnel of the Issuer’s Supervisory Board.
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3. Significant events of the financial year 2014, affecting the Issuer’s activity
According to the Issuer’s Board, in the report period no significant events affecting the Company’s activity
occurred.
4. Expected development of the Issuer.
The strategic goal of the Issuer is further expansion on the domestic and European markets. The Issuer
consequently realizes the strategy of further strengthening of the market position through organic development
and capital investments. At present, the Issuer concentrates on increasing the productive capacity on account of
the growing demand on the market. Apart from the development of the current activity, the Issuer realizes two
strategic goals:
A. The development of sales in pharmaceutical segment – the Issuer’s subsidiary -BSC Pharmacenter Sp. z o.o.
achieved specialization as a printing house for pharmaceutical packaging. To this end new production areas were
built, machine park was bought and a set of procedures and quality certificates were implemented in order to
meet the highest demands of customers from that segment.
B. In accordance with the development strategy, there is a plan to enter new service categories on the printing
market where the Issuer is operating as an experienced subject. According to the Board, the interesting segment
in the branch is the segment of web print technology. At present the Issuer is operating on one Gallus web
machine, which enables printing both in offset and flexographic technology and provides other print processing
possibilities. The issuer forecasts that in the future they will invest in another similar web machine, which will
probably result in organizational and infrastructural changes (new production halls) and founding a new subsidiary
entity BSC Flexo.
Moreover, the Issuer still does not exclude the purchase of the majority block of shares or stocks of an entity of
packaging branch. The Board assumes that the object of the potential takeover will be a company operating on
the middle-east European market. At present the Issuer has withdrawn from investment plans in Russia on
account of the political situation.
5. Significant achievements in research and development area
In the year 2014 no development work was accomplished. At present a few development tasks are being carried
out and their value as at balance date was PLN 599,000.
6. Current financial situation.
The following table demonstrates the selected financial data on the financial situation of the Issuer.
Selected financial data (in thousands PLN) 2014 2013
Change in
thousands
PLN Dynamics
Revenue from sales of products, services,
goods and materials
172 622 155 308 17 314 11%
EBITDA 29 174 27 051 2 123 8%
Operational profit (EBIT) 20 792 19 718 1 074 5%
Profit before taxation 21 496 20 969 527 3%
Net profit 17 505 16 931 574 3%
Long-term liabilities 16 366 18 058 -1 692 -9%
Short-term liabilities 20 640 23 782 -3 142 -13%
Equity 178 313 165 712 12 601 8%
Share capital 9 808 9 808 0 0%
Number of shares 9 807.52 9 807.52 0 0%
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The most important financial data for the year 2014:
Increase in sales of products by PLN 17.3 million,
Increase in EBITDA by PLN 2.1 million,
Increase in net profit by PLN 0.5 million.
Changes in the Issuer’s financial results in 2014 compared to the year 2013 mainly resulted from:
Increase in EBITDA by 8% was the result of increase in sales by 11% – EBITDA margin dropped by 0.5%;
The sales increased mainly thanks to the increase in sales to the current customers, expanding the
cooperation with customer Mondelez and other;
The decrease in the Issuer’s liabilities globally by PLN 5 million is mainly the effect of fully repaid Gallus
machine (so called flexo investment)- which was not settled as at the end of the year 2013 and the effect
of the repayment of credit instalments; at the same time, the Issuer did not incur any new financial
liabilities in the year.
Margins achieved by the Issuer are presented in the table below.
During the whole year 2014 compared to the year 2013 the Issuer’s operational and EBITDA margins decreased
slightly. It is worth mentioning that in the year 2014 one-time occurrences were insignificant for the closing
result, except the sales of the printing machine in IV quarter, which contributed to the improvement of the
gross result by total of PLN 1.1 million.
To sum up, the Issuer’s financial situation after the ended year 2014 is characterized by:
- High participation of equity financing (83%),
- Still high operational profitability (approx. 12%) and slightly lower net profitability (approx. 10%).
7. Purchase of own shares
In 2014 there were no transactions of purchasing own stocks/ shares in the Company.
8. Branch offices and plants
The Issuer does not own branch offices or plants.
9. Financial instruments
Bank credits are the main financial instruments used by the Entity. The main objective of those instruments is gaining financial means for the Entity’s activity. BSC Drukarnia Opakowań S.A. also owns financial assets, such as trade receivables, cash assets and short-term deposits which are generated directly in the course of the Entity’s activity. Currently the Entity has applied a rule of not trading with financial instruments. The main types of risks arising from the Entity’s financial instruments include the interest rate risk, cash flow risk, liquidity risk, currency risk and credit risk. The Board verifies and arranges the rules of management of each of the risk types – the rules are briefly discussed below.
Interest rate risk
Profit per 1 ordinary share 1.78 1.73 0 3%
Margin 2014 2013 Change in
percentage point
Margin on operational level 12.04% 12.70% -0.65%
EBITDA margin 16.90% 17.42% -0.52%
Gross profit margin 12.45% 13.50% -1.05%
Net profit margin 10.14% 10.90% -0.76%
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BSC Drukarnia Opakowań S.A. is a party in credit agreements based on variable rates of WIBOR and LIBOR. Because of that the Group is exposed to the interest rate risk. In the Issuer’s Board’s opinion, there is no need to provide protection in relation to that kind of risk.
Credit risk BSC Drukarnia Opakowań S.A. concludes transactions only with renowned companies of good creditworthiness. All clients who intend to take advantage of commercial credits undergo the procedures of initial verification. Moreover, thanks to current monitoring of receivables balance, the Entity’s exposition to the risk of irrecoverable receivables is little. Still, some problems with individual clients may arise. But their participation in sales is so insignificant that it will not cause liquidity problems of the Issuer. It may only influence the financial result of the period.
Liquidity risk
BSC Drukarnia Opakowań S.A. monitors the risk of lack of funds with the use of periodical liquidity planning.
The tool takes account of maturity dates of both investments and financial assets (for example receivables
accounts, other financial assets) and forecasted cash flows from operational activity.
The Entity’s objective is to maintain the balance between continuity and flexibility of financing by taking
advantage of different sources of financing, such as credits in current account, financial lease agreement with
purchase possibility.
Currency risk
Exchange rate influences the Entity’s activity in two ways. On one hand high rate of Polish zloty in comparison to the rate of euro allows cheaper purchase of cardboard in foreign paper mills. On the other hand, it affects the
Entity’s revenues in a negative way. Sales of packaging on foreign markets currently amounts to 26% (in EUR, CZK and USD), it is worth mentioning, though, that some prices of packaging sold on the Polish market are established in euro and sold in EUR.
The participation of revenues in euro in 2014 amounted to approximately 27%. The participation of the raw material purchased in foreign currency in that period was approx. 25% of revenues. Because of that in the year 2014 the risk of change in EUR Exchange rate was considerably limited in a natural way. It is worth mentioning, though, that the Issuer took out mortgage in CHF and on account of that the Issuer is exposed to the risk of weakening of the Polish zloty against Swiss franc. Additionally, on account of the beginning of realization of deliveries to one of the key customers to the Czech
market, since the third quarter of 2014 the Issuer has been exposed to the risk of weakening of Czech Koruna
– the Board limits that risk by using the instruments of futures market.
The Issuer’s Board uses the instruments of financial futures market in order to secure currency exchange rate.
10. Description of significant factors of risks and threats with the specification of the Issuer’s
exposition to them
Risk factors connected with the Issuer’s activity:
Risk connected with production line failure
Proper functioning of machines and devices has a significant influence on the Issuer’s activity. In relation to
that a failure causing temporary limitation to manufacturing abilities cannot be eliminated. Such the situation
may lead to breaks in printing packaging and consequently the loss or reduction of the contracts owned, which
may eventually negatively affect the Issuer’s revenue and financial results. The level of exposition to this risk is
low.
In order to minimize the risk of failure and prevention against its potential effects the Issuer invests in new
machines with guarantee period. Normally the guarantee agreement includes service performed by the
supplier. Additionally within maintenance all machines undergo systematic control of technical condition in
accordance with the scheme applied by the Company.
The Issuer’s main shareholder and strategic partner is the company Colorpack Verpackungen mit System
GmbH. In the case of failure in production line there is the possibility to order this company to prepare
packaging, which also leads to the reduction of the above mentioned risk.
Risk connected with losing key customers
At present approximately 80% of revenue was generated by 10 customers and approximately 40% of revenues
was generated by the Issuer’s two main customers. There is then a potential risk of losing the customers, which
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might significantly influence the Issuer’s financial result in a negative way. The level of exposition to that risk is
medium.
The main customer in the year 2009 set up another production plant in Poland, which reduces the risk of
transferring the production to another country. The Issuer’s Board also reduces the risk by customers’ branch
diversification which reduces the dependence of financial results on the situation in a specific branch and by
long-term cooperation with key customers.
Risk connected with delivery of faulty packaging or packaging not consistent with the order.
In relation to the scale of activity run by the Issuer there is a risk that as a result of faulty work of machines in
production lines or as a result of wrong transport of packaging ordered by the customer, the packaging will not
meet certain criteria. Damaging or introducing faulty packaging may badly influence the Issuer’s image as a
reliable business partner. Moreover, the damage caused by the delivery of faulty packaging may lead to
financial claim from the Issuer’s customers. The level of exposition to that risk is low.
The Issuer’s Board counteracts that risk by applying a set of procedures. Additionally, BSC Drukarnia Opakowań
S.A. is partly insured against such events. The above mentioned actions effectively reduce that risk, whose
occurrence might negatively influence the Issuer’s financial results.
Risk connected with the environment where the Issuer operates
Risk connected with changes in delivery prices of raw materials.
The basic material used in the Issuer’s activity is paper and cardboard. The price of raw materials significantly
affects the cost of products offered by the Company. The risk of increase in the prices of raw materials may
cause the increase in production cost and consequently the decrease of the Issuer’s financial result. At present
the level of exposition to that risk is medium.
Many factors affect the price and availability of paper and cardboard, such as: raw materials supply which then
is affected by legal conditions resulting from national and the EU regulations concerning environmental
protection, government policy or price of zloty in reference to foreign currency. The Issuer does not have direct
influence on the changes in prices of raw materials delivery. The Issuer reduces the risk by common negotiating
the scale and date of potential price increase together with the strategy Partner – rlc Group.
Risk connected with macroeconomic situation in Poland and Europe.
The economic situation in packaging sector remains in positive correlation with the overall economic situation of
Poland and other European countries, especially with the situation of cosmetic, pharmaceutical and food
branches, which are the main customers of the Issuer’s services. The development of factors such as: Gross
Domestic Product (GDP), purchasing power of money, the level of unemployment, strengthening of Polish zloty
in relation to other currency, the pace of economic growth may influence the Issuer’s sales.
The economic slowdown causes the decrease in pace of consumption growth and worsening of the economic
situation of enterprises and it may consequently translate to the results achieved by the Issuer and their
subsidiary. The level of exposition to that risk is medium.
Risk connected with legal-fiscal environment where the Issuer operates.
The rules of taxation, the level of taxes or fiscal and control procedures in Poland are regulated by the
Constitution of the Republic of Poland and various fiscal acts together with executive acts issued with them in
the form of ordinates. The multitude of fiscal acts and adopted solutions – not always consistent with the EU
regulations, though - frequent amendments and novelizations lead to the fact that applying the fiscal law by
taxpayers is very onerous and weighed with risk. The adopted system of individual interpretations of the fiscal
law does not make that task easier either. The individual interpretations issued by the Minister of Finance are
often contradictory and inconsistent with the interpretation line applied by the administrative courts. That leads
to the fact that taxpayers are forced to use the knowledge and experience of specialized tax advisors and
lawyers. Disputes with fiscal bodies often involve a significant human potential and capital which otherwise
might be used to run operational activity. The unfavorable system of control of public-legal settlements makes
entrepreneurs pay much attention to the aspect of the settlements with the budget and constantly follow the
changes in the fiscal law. Taxpayers’ mistakes, often not being their fault, are burdened with high responsibility
in the penal-fiscal code or collective subjects. Additionally, the increase in indirect taxes introduced in 2011 and
changes in the scope of VAT exemption do not improve that state of facts.
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All the phenomena lead to the fact that the tax risk in Poland is significantly higher than in other countries of
more developed fiscal systems, which creates lower competitiveness of the Polish entrepreneur. Still, recent
changes in the fiscal law, especially in the acts of corporate tax and Value Added Tax adapting Polish
regulations to the EU regulations and the planned consolidation of laws concerning income tax (PIT and CIT)
calculations allow to assume that the perspectives of development of Polish companies are good and the
direction of the adopted changes is right. Shortcomings similar to the fiscal law are demonstrated in the model
of controlling the settlements with the budget adopted in Poland. For many entrepreneurs it is not clear or
friendly.
11. Indication whether the company is a parent entity or a significant investor and whether they draw
up the consolidated financial statement
Since 16 May 2006 the Company BSC Drukarnia Opakowań S.A. has been a parent entity for BSC Pharmacenter
company limited and draws up the consolidated financial statement. The parent company holds 100% shares of
the BSC Pharmacenter Sp. z o.o.
12. Indication of the effects of changes in the structure of the economic entity, including the result of
merging economic entities, acquisition or sales of entities of the issuer’s capital group, long-term
investments, division, restructuring and abandoned activity.
In 2014 there were no changes in the structure of BSC Drukarnia Opakowań S.A..
13. Information concerning shareholders of the parent entity- the issuer
As at 31.12.2014 the structure of shareholders of the parent entity was as follows:
Specification Number of
shares
Total nominal
value of
shares (in
thousands
PLN)
Participation in the share capital
Number of
votes
Participatio
n in the
votes on the
General
Meeting
Janusz Schwark 1 190 758 1 191 12.14% 1 190 758 12.14%
Arkadiusz Czysz 1 134 586 1 135 11.57% 1 134 586 11.57%
Violetta Schwark 850 939 851 8.68% 850 939 8.68%
ColorpackVerpackungenmit
System GmbH 3 599 300 3 599 36.70% 3 599 300 36.70%
PKO BP Bankowy Otwarty
Fundusz Emerytalny 721 614 722 7.36% 721 614 7.36%
Norges Bank 563 232 563 5.74% 563 232 5.74%
ALTUS TFI S.A. 561 289 561 5.72% 561 289 5.72%
OTHERS 1 185 798 1 186 12.09% 1 185 798 12.09%
TOTAL 9 807 516 9 808 100.00% 9 807 516 100.00%
All shares issued by the parent company are ordinary shares without any privilege.
As at the day of drawing up the statement the structure of shareholders of the parent entity was as follows:
Specification Number of
shares
Total nominal
value of
shares (in
thousands
PLN)
Participation in the share capital
Number of
votes
Participatio
n in the
votes on the
General
Meeting
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Janusz Schwark 1 190 758 1 191 12.14% 1 190 758 12.14%
Arkadiusz Czysz 1 134 586 1 135 11.57% 1 134 586 11.57%
ColorpackVerpackungenmit
System GmbH 3 599 300 3 599 36.70% 3 599 300 36.70%
PKO BP Bankowy Otwarty
Fundusz Emerytalny 721 614 722 7.36% 721 614 7.36%
Aviva Investors Poland TFI
S.A. 624 562 625 6.37% 624 562 6.37%
Norges Bank 563 232 563 5.74% 563 232 5.74%
ALTUS TFI S.A. 561 289 561 5.72% 561 289 5.72%
OTHERS 1 412 175 1 412 14.40% 1 412 175 14.40%
TOTAL 9 807 516 9 808 100.00% 9 807 516 100.00%
Since delivering the last quarterly report the following changes in the structure of ownership of major blocks of the Issuer’s shares were made: - Violetta Schwark, as a result of transaction of sales of the Issuer’s shares on 4th and 6th March 2015, decreased her ownership of shares from 850,939 shares to 0 shares. The Company informed about that transaction in their current Report no 3/2015 dated 10 March 2015, - Anna Schwark, as a result of transaction of sales of the Issuer’s shares on 4th and 6th March 2015, decreased her ownership of shares from 283,647 shares to 0 shares. The Company informed about that transaction in their current Report no 3/2015 dated 10 March 2015, - Aviva Investors Poland TFI S.A., as a result of transaction of purchase of the Issuer’s shares on 4th March 2015 increased their ownership of shares from 340,915 to 624,562 shares, thus reaching the level of 6.37% of the participation in the share capital and number of votes on the Issuer’s Annual General Meeting; The Company informed about that transaction in their current Report no 4/2015 dated 10 March 2015.
At the same time, as a consequence of the sales transaction of the Issuer’s shares by Violetta Schwark and Anna Schwark, the share ownership structure of the Parties to the Shareholders’ Agreement changed:
- Before the transaction of shares sales Violetta Schwark and Anna Schwark, on the basis of the
agreement dated 15 April 2008 concluded by “BSC INVEST” V. SCHWARK, J. SCHWARK, A. CZYSZ SPÓŁKA JAWNA, Arkadiusz Czysz, Janusz Schwark, Violetta Schwark, Anna Schwark and COLORPACK GmbH Berlin Verpackungen mit System – (“the Agreement”), which the Company informed about in their prospectus, together with the parties to the Agreement owned 7,059,230 of the Company’s shares, constituting 71.98% of the Company’s share capital and giving the right to 7,059,230 votes on the Company’s Annual General Meetings, that is 71.98% of the total number of votes in the Company;
- After the concluding the transaction of share sales, the remaining parties to the Agreement, that is Arkadiusz Czysz, Janusz Schwark and COLORPACK GmbH Berlin Verpackungen mit System still own 5,924,644 of the Company’s shares, constituting 60.41% of the Company’s share capital and giving the right to 5,924,644 votes on the Company’s Annual General Meetings that is 60.41% of the total number of votes in the Company.
14. List of holding of the Issuer’s shares by managing and supervising persons as at 31.12.2014
Holding of the Issuer’s shares by managing and supervising persons as at the day of drawing up the report:
Specification Post at the Issuer’s Number of shares
Janusz Schwark President of the Board 1 190 758
Arkadiusz Czysz Vice-president of the Board 1 134 586
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Andrzej Baranowski Vice-president of the Board 1 000
15. Information concerning basic products
The information concerning operational segments is demonstrated in the consolidated Board report of BSC
Group.
16. Information concerning key customers
The Issuer cooperates with customers sales to whom individually constitutes at least 10% of the Issuer’s
equity. The table below demonstrates these customers:
sales to customer % participation in Issuer’s
equity Customer name
Over 30% None
20.01% - 30.00% None
10.00% - 20.00%
- Gillette Group1
- McDonalds Group2
There are no connections between the Issuer and the above mentioned customers.
17. Information concerning output markets.
Output markets – territorial structure:
Specification 2014
2013
Domestic 132 312 119 608
Export 40 310 35 700
Total net revenue from sales 172 622 155 308
Output markets – branch structure:
Specification
12 months ended
31.12.2014
thousands PLN
12 months ended
31.12.2013
thousands PLN
Packaging for cosmetics branch 67 075 60 818
Packaging for food branch 71 490 70 326
Packaging for pharmaceutical branch 2 327 4 657
Other 1 308 957
1The Group of the Issuer’s customers connected with the selected brand of products offered by the customers. The group includes: SONOCO POLAND Packaging Services Sp. z o.o., Gillette Poland International Sp. z o.o., Procter and
Gamble Distribution Company LLC, Procter and Gamble International Operations S.A. 2The Group of the Issuer’s customers connected with the selected brand of products offered by the customers. The group includes: McDonald’s POLSKA SP. z o.o., McDonald'sAzerbaijan LLC, McDonald'sDeutschland Inc.,
McDonald'sFranchise GmbH, Neltdoo, Premier Capital Hellas S.A., Premier RestaurantsLatvia SIA, Sc HaviLogisticsSrl, SJ Company doo, LLC Rulog, HAVI GLOBAL SOLUTIONS EUROPE Ltd, CESLOG sro, Creata (Germany) GmbH, G-System Logisticsdoo, Hagipanagou SA, HAVI Global Solutions Europe GmbH, Havi Global Solutions Europe GmbH c/o HaviLogisticsBelgium, HaviLogistics: doo, EOOD, Gmbh, Kft, s.r.o, SIA, Sp. z o.o.
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Net revenue from sales of products 142 200 136 748
Net revenue from sales of goods 30 422 18 560
Total net revenue from sales 172 622 155 8
18. Information concerning suppliers
The suppliers are both domestic companies and foreign companies.
The Issuer cooperates with suppliers to whom the sales constitutes individually at least 10% of the Issuer’s
equity. The table below presents these suppliers:
% purchase participation in Issuer’s equity Customer name
Over 30% None
20.01% - 30.00% None
10.00% - 20.00% - I.P. Kwidzyń
There are no connections between the Issuer and the above mentioned suppliers
19. Information concerning concluded agreements significant for the Issuer’s activity, including the
agreements, known to the Issuer, concluded between shareholders (business partners), insurance
agreements, cooperation or collaboration.
a. Significant agreements of supply for the Issuer are concluded on the level of rlc Group where the
Issuer belongs. It concerns e.g. agreements with the entity IP-Kwidzyn Sp. z o.o. based in Kwidzyn.
The agreements concluded are frame agreements. Each year the parties establish the Issuer’s yearly
demand for cardboard and price terms. The conditions of realization of the agreements are established
in the electronic way. The Issuer orders the receipt of the raw material on specific dates. The Issuer
may obtain additional discount from the producer for prompt receipt of the material from the factory.
Within the established yearly budgets the Parties set yearly discounts, settled at the end of the year.
Additional discounts are granted for prompt payments for the raw material. The Parties did not define
decisions concerning contractual fines or special rules of responsibility other than the ones arising from
the absolutely binding legal regulations.
The above mentioned agreement was classified as significant in relation to the value.
b. The Issuer is a Party in significant agreements concluded with key customers of packaging or rlc Group
concludes such the agreements on behalf of the Issuer. The Issuer is directly a Party to the agreement
with HAVI Global Solutions Europe Limited (the Company serving McDonald’s Group). But rlc Group
concluded an agreement with Procter & Gamble Group and Mondelez. The Group informed the market
about concluding the agreement by rlc Group with the customer Mondelez in their current report no
12/2014 dated 22 September 2014.
The agreements concluded are frame agreements. The terms of the agreements are established in
writing. The Parties establish the amount of production of specific products and yearly budgets (prices
for particular packaging at specific outlays). The Issuer functions as a key supplier for the following
entities: Procter & Gamble Group and McDonald’s Group. The communication with Procter & Gamble
Group is carried out by electronic means in an automated way. The pricelists are updated with the
entities: Procter & Gamble Group, McDonald’s Group by electronic mail.
The three of the above mentioned agreements were classified as significant in relation to the value.
c. On 15 April 2008 the shareholders: Violetta Schwark, Anna Schwark, Janusz Schwark, Arkadiusz
Czysz, BSC Invest V. Schwark, J. Schwark, A. Czysz Sp. j. based in Poznan and COLORPACK
Verpackungen mit System GmbH based in Rüdersdorf near Berlin signed an agreement concerning:
Establishing common relations between shareholders and the duty of cooperation between the
shareholders within the Issuer’s bodies (the shareholders pledged to operate within the Issuer in a
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unanimous and loyal way aspiring to consolidating settlement of disputes and to maintain the majority
block of the Issuer’s shares throughout the effective period of the agreement;
Appointing and selecting a defined number of members of the Issuer’s bodies: The Supervisory Board
and the Board;
Mutual informing of the number of the Issuer’s shares held and of the intention of purchasing the
Issuer’s shares;
Establishing the rules of potential sales of the shares by the shareholders through introducing mutual
priority right;
Contractual limitation of sales of shares for the period of three years from the first day of listing of
shares on Warsaw Stock Exchange S.A.;
Rules of common representation on the General Meeting of Shareholders, meaning unanimous voting
of all shareholders on the General Meeting of the Issuer in all matters included in the agenda of the
General Meeting; the shareholders decide on the voting method by the majority of 67% votes, they
also gave permanent and irreversible authorization to exercise the voting right concerning the Issuer’s
shares (reserving the possibility of unanimous revoking the power of attorney by all signatories to the
decision);
Pledge to refrain from shareholders’ taking up actions competitive to the Issuer within the meaning of
art. 380 of the Code of Commercial Companies (which are meant as providing printing services,
excluding statutory activity run by COLORPACK Verpackungen mit System GmbH).
This agreement was amended on 24 August 2010 concerning the effective date – the agreement came into
effect on the day preceding the date of registration of the Issuer’s shares by the National Depository for
Securities S.A. in the depository for securities. The agreement was concluded for indefinite period of time on
the stipulation that it is binding until the shareholders: Violetta Schwark, Anna Schwark, Janusz Schwark,
Arkadiusz Czysz i BSC Invest V. Schwark, J. Schwark, A. Czysz Sp. j. based in Poznań independently or
collectively or the shareholder Colorpack independently achieve over 50% participation in the Issuer’s share
capital.
20. Information concerning organizational or capital connections of the Issuer with other entities and
defining the Issuer’s main domestic and international investments (securities, financial
instruments, intangible and legal values and properties), including capital investments outside
their group of related entities and the description of their financing methods.
The strategic investor of the Issuer is the company Colorpack GmbH Berlin Verpackungen mit System based
in Rüdersdorf near Berlin (Germany). Colorpack GmbH Berlin Verpackungen mit System holds 36.70% in the
share capital and votes on the Issuer’s General Meeting. Colorpack belongs to rlc Packaging Group. The
strategic investor specializes in production of Classic packaging, owns a modern and highly automated machine
park.
The Issuer did not make any investment outside their group of related entities.
21. Information concerning significant transactions entered by the Issuer or their subsidiary entity
with subjects related on terms other than market conditions, together with their amounts and
information defining the character of these transactions – the duty is recognized as fulfilled by
indicating the place where the information is provided in the financial statement.
The Companies of BSC Drukarnia Opakowań S.A. Group entered transactions with related subjects only on
market conditions.
22. Information concerning agreements concluded and denounced in the particular financial year
concerning credits and loans, demonstrating at least their amount, type and interest rate level,
currency and due date.
The Issuer did not conclude or denounce any credit or loan agreements in the year 2014.
23. Information concerning loans granted in the particular financial year, with particular focus on
loans granted to the Issuer’s related entities, demonstrating at least their amount, type and
interest rate level, currency and due date;
In the year 2014 the Issuer granted a loan to the subsidiary BSC Pharmacenter Sp. z o.o. The loan data: - Loan amount – PLN 1,800,000, - Currency – PLN, - Interest rate – 5.0% AER,
Page 12 of 23
- Due date – repayment in monthly instalments up to and including June 2018.
Apart from that, the Issuer granted loans to the employees and cooperating subjects at total amount insignificant for the Issuer’s activity.
24. Information concerning guarantees received and granted in the particular financial year, with
particular focus on guarantees granted to the Issuer’s related entities.
In the year 2014 no such events occurred.
25. In the case of issuing securities in the period of this report – description of inflows from the
issuance used by the Issuer up to the moment of drawing up the report on the Issuer’s activity;
N/A
26. Explanation of differences between the financial results demonstrated in the annual statement
and earlier published prognosis of the results for the particular year.
The Issuer did not publish prognosis of the results for the year 2014.
27. Assessment with its substantiation, concerning managing the financial resources, with a particular
focus on the ability of fulfillment of the liabilities and defining potential risks and actions that the
Issuer undertook or intends to undertake in order to counteract these risks.
The Issuer’s situation as at 31.12.2014 is presented below and it demonstrates very safe structure of the
Issuer’s financing.
SEPARATE STATEMENT OF FINANCIAL SITUATION in thousands PLN
2014 2013 Dynamics Structure
2014
Structure
2013
Non-current assets
106 485 102 954 3% 49% 50%
Current assets
108 834 104 598 4% 51% 50%
Total assets
215 319 207 552 4% 100% 100%
Equity
178 313 165 712 8% 83% 80%
Long-term liabilities
16 366 18 058 -9% 8% 9%
Short-term liabilities
20 640 23 782 -13% 10% 11%
Total liabilities
215 319 207 552 4% 100% 100%
According to the Board, the Issuer’s financial liquidity is not at risk and the following liquidity ratios indicate the
ability to fulfill the liabilities.
Ratios 2014 2013 Dynamics
Liquidity ratio I
6.09 4.89 24.3%
Liquidity ratio II
4.37 3.68 18.6%
Debt ratio
17.19% 20.16% -14.7%
Net working capital (in thousands PLN) 90 970 83 261 9.3%
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As at the day of drawing up the report the Board does not know of any events which might pose a threat to
fulfilling the liabilities in the future.
28. Assessment of ability to realize investment plans, including capital investments, compared to the
amount of owned means taking into account potential changes in the structure of financing of that
activity;
As at the day of drawing up the report the Issuer has the ability to realize the investment plans from own
means.
29. Evaluation of factors and atypical events affecting the result of the activity for the financial year,
defining the extent of influence of these factors or atypical events on the result achieved.
Atypical events which occurred in the year 2014 had insignificant effect on the financial results, except for the
sales of a printing machine in IV quarter, which contributed to the improvement of the total gross result by PLN
1.1 million.
30. Characteristics of external and internal factors significant for the development of the Issuer’s
enterprise and description of perspectives of the development of the issuer’s activity at least to
the end of the financial year following the financial year that the financial statement concerns and
which is included in the annual statement, taking into account the elements of market strategy
developed by the Issuer.
Chances:
- developing the assortment of products offered after the implementation of web print technology, including
flexographic technology,
- opening new factories in Poland by foreign entities – transferring the production to Poland,
- becoming a professional supplier of packaging and inserts for pharmaceutical branch – investments in the
subsidiary entity - BSC Pharmacenter
- successful acquisition on the middle-east European market.
Strengths:
- direct access to many markets thanks to the activity in rlc Group – the Issuer perceived by the customers
as a big supplier being part of rlc Group,
- experienced managerial personnel
- very safe financing structure of the Group;
Threats:
- changeability on currency and financial markets,
- unstable economic and geopolitical situation,
- increase in prices of raw materials,
- strong price competition.
The perspectives of development of the Issuer are currently stable. The Issuer expects further increase in sales
and operational and net results of the Issuer.
31. Changes in basic rules of managing the issuer’s enterprise and their capital group
In the year 2014 no changes mentioned above occurred.
32. All agreements concluded between the issuer and managing persons, anticipating compensation in
the case of their resignation or dismissing from the post held without important reason or when
their resignation or dismissal occurs because of merging the issuer by take-over.
In the financial year 2014 such agreements were not concluded.
33. Value of remuneration, awards or benefits, including the benefits from motivational schemes or
bonus schemes based on the issuer’s capital, including programs based on bonds with priority
right, exchangeable bonds, subscription warrants (in money, kind or any other form), paid, due to
or potentially due separately to each of the persons managing and supervising the issuer in the
Page 14 of 23
issuer’s enterprise, regardless of the fact whether they were recognized in costs or resulted from
distribution of profit; in the case when the issuer is the parent company or partner of the
interdependent entity or a significant investor – separately information concerning the value of
remuneration and awards received on account of performing duties in the management of
subordinate entities;
In the year 2014 the Board received base remuneration and bonus from net profit made by the Parent Entity. The
Supervisory Board receives remuneration according to the resolution of the General Meeting from 16 May 2011.
Besides:
- Andrzej Borowiński receives remuneration resulting from employment contract concluded with the subsidiary
entity BSC Pharmacenter Sp. z o.o.
Remuneration of persons being members of managing and supervising bodies paid:
In thousands PLN 2014 2013
1 J.SCHWARK Board Member 645 619
2 A CZYSZ Board Member 645 618
3 A.BARANOWSKI Board Member 633 606
4 A. BOROWIŃSKI Member of Supervisory Board 4 39
5 A SCHWARK Member of Supervisory Board 5 12
6 H.J.Katzer Member of Supervisory Board 5 7
7 S. Bestehorn Member of Supervisory Board 6 8
8 H. Kehren Member of Supervisory Board 6 12
9 H.CH. Bestehorn Member of Supervisory
Board 6 12
10 M. Dietl Member of Supervisory Board 13 7
34. Information concerning the system of controlling employee stock programs;
The Issuer does not have the system of controlling employee stock programs.
35. Information concerning:
Date of concluding an agreement by the Issuer with the subject authorized to audit financial statements, for
performing audit and review of the financial statement or the consolidated financial statement and the effective
period of this contract,
2014-08-07
remuneration of the subject authorized to audit financial statements, paid or due for the financial year for:
-Audit of the separate annual financial statement and consolidated financial statement:
PLN 27,000
- Audit of the separate annual financial statement of the subsidiary company,
PLN 9,000,
- review of the semi-annual separate and consolidated financial statement:
PLN 17,100,
- Other authenticating services
PLN 9,000
remuneration of the subject authorized to audit financial statements, paid or due for the previous financial
year for:
- Audit of the separate annual financial statement and consolidated financial statement:
PLN 30,000,
- Audit of the separate annual financial statement of the subsidiary company
PLN 10,000,
- review of the semi-annual separate and consolidated financial statement:
PLN 19,000,
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- services of accounting and tax consulting
PLN 10,000.
36. Judicial proceedings and conciliation – information concerning all proceedings before
governmental bodies, judicial proceedings and conciliation (including all proceedings in progress
or which, according to the Company’s knowledge, may arise) for the period including at least the
last 12 months, which could have or had in the recent past the significant influence in the financial
situation or profitability of the Company or placing appropriate statement stating their lack
At present no proceedings against the Issuer are held before the governmental bodies, either judicial
proceedings or conciliation which might affect the financial situation.
37. Information concerning credit or loan collateral or guarantee given by the issuer or by the
subsidiary entity to one subject or entity subordinate to that subject in total, if the total amount of
the existing collaterals or guarantees constitutes the equivalent of at least 10% of the Issuer’s
equity.
The Issuer did not give credit or loan collaterals or guarantees.
38. Information concerning concluding one or many transactions between the issuer or the entity
subordinate to the issuer and affiliates subject if they are separately or collectively significant and
were concluded on other than market conditions, except for transactions concluded by the issuer
being the fund with the related subject, together with indication of their value, while information
concerning particular transactions may be grouped according to the kind, except for the case
when information concerning particular transactions is necessary for understanding their
influence on the issuer’s economic and financial situation and the issuer’s financial result.
All transactions in the Group are concluded on market conditions.
39. Declaration of the Board of BSC Drukarnia Opakowań S.A. concerning application of rules of
corporate governance in public companies in the year 2014.
A. Indicating the rules of corporate governance which were not applied by the Issuer, together
with the indication of circumstances and reasons of not applying the specific rule and the
way that the Company intends to remove the potential effects of not applying the specific
rule and what steps they intend to take in order to lower the risk of not applying the rule in
the future.
The Board of BSC Drukarnia Opakowań S.A. based in Poznań (also referred to as: „the Company” or „the
Issuer”) in relation to § 29 pt 2 of the Stock Exchange Regulations undergoes a collection of rules of
corporate governance passed by the Stock Exchange Council.
The text of the collection of rules of corporate governance in versions applicable in particular years is available
on the following website: http://www.corp-gov.gpw.pl
The Issuer in the year 2014 did not apply the following rules of “Best Practices of WSE Listed Companies” (in
the meaning binding from 1 January to 31 December 2014, also referred to as: “Best Practices”):
a) Rule no 12 defined in part I „Recommendations for best practice for listed companies” providing
that „A company should enable its shareholders to exercise the voting right during a General
Meeting either in person or through a plenipotentiary, outside the venue
of the General Meeting, using electronic communication means.”
Reasons and intentions: Currently the Articles of Association of the Company does not provide the possibilities
of taking part in a General Meeting using electronic communication means in the way concluded from the
relevant rule. According to the Board of the Company, introducing the above mechanisms would be connected
with high costs incurring which is not necessary at this stage. However, in the case of making a change in the
Company Articles of Association and considerable interest in the above mentioned means appearing among the
shareholders, the Board does not exclude applying the above mentioned mechanisms.
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b) Rule no 1 within 9a) defined in part II of „Best Practice for Management Boards of Listed Companies”
which provides recording the General Meeting in video or audio format and publishing it on the
corporate webpage of the Company.
Reasons and intentions: The Company assumes that the shareholders who are absent on General Meetings are
properly informed of the course of the General Meetings immediately after they end by performing the
information duty by the company. Within the scope of the duty the Company publishes among other things the
information concerning resolutions passed. The Company while deciding not to apply this rule also took into
consideration the potential costs of implementing and obeying this rule (providing professional service and
equipment for recording General Meetings in audio or video format) and decided that incurring them at this
stage would be pointless. However, the Company does not exclude introducing this rule in the future if
appropriate motions in this area are submitted by the shareholders.
c) Rule no 6 defined in part III “Best Practice for Supervisory Board Members” pointing out that at least
two members of the supervisory board should the fulfill criteria of independence from the company or
subjects remaining in significant connection with the company.
Reasons and intentions: The Articles of Association of the Company do not specify the criteria of selection of
independent members of the Supervisory Board. The Articles of Association of the Company defines personal
entitlements of the current shareholders concerning appointing or indicating candidates for members of the
Supervisory Board. The selection of the Supervisory Board members each time depends on the shareholders’
will expressed during voting on passing the relevant resolution of the General Meeting. According to the
Company, limiting the possibility of selecting the members of the Supervisory Board would involve wide-ranging
limitation of the autonomy of the Shareholders’ will in relation to the realization of their corporate rights. Thus,
currently the Company does not intend to introduce the above mentioned rule.
d) Rule no 10 defined in part IV “Best practices of shareholders” providing that „A company should enable
its shareholders to participate in a General Meeting
using electronic communication means through:
1) real-life broadcast of General Meetings;
2) real-time bilateral communication where shareholders may take the floor
during a General Meeting from a location other than the General Meeting.
Reasons and intentions: The Articles of Association of the Company currently do not stipulate the possibility of
taking part in the General Meeting with the use of electronic means of communication in the way concluded
from the relevant rule. According to the Board of the Company, introducing the above mechanisms (as in the
case of rule I.12) would be connected with high costs incurring which is not necessary at this stage. However,
in the case of making a change in the Articles of Association of the Company and considerable interest in the
above mentioned means appearing among the shareholders, the Board does not exclude applying the above
mentioned mechanisms.
B. The course of conduct of the General Meeting and its fundamental entitlements and
description of the shareholders’ rights and the methods of exercising them:
The Articles of Association of the Company and the Regulations of the General Meeting regulate the matter of
calling General Meetings, including the rules of participation in them in the way described below. As for the
other matters the relevant rules of the Code of Commercial Companies shall be applied.
The General Meeting may be ordinary or extraordinary and takes place in the Company’s head office.
The Ordinary General Meeting is called by the Company’s Board and it should take place not later than 6
months after the end of each financial year of the Company.
The subject of the Ordinary General Meeting is (apart from other matters included in the agenda):
- Examination and approval of the report, balance and profit and loss account for the previous year,
- Passing a resolution concerning profit distribution or cover of loss,
- Providing the members of the Supervisory Board and the Board with a vote of approval concerning
the fulfillment of their duties.
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The Extraordinary General Meeting is called by the Company’s Board out of their own initiative or on a written
proposal of the shareholders representing not less than 1/20 share capital. The demand of calling the
Extraordinary General Meeting is to be delivered to the Board in writing or in the electronic form.
The Supervisory Board may call the Ordinary General Meeting if the Board does not call it in the time defined in
the Articles of Association or in the absolutely binding legal regulations and the Extraordinary General Meeting if
they find calling it advisable.
The Extraordinary General Meeting may be called by the Shareholders representing at least half of the share
capital or at least half of the general number of votes in the Company.
The General Meeting of a public company is called by announcement on the company’s website and in the way
defined for transmitting current information in accordance with the regulations of public offer and conditions of
organized trading of financial instruments and public companies.
The announcement should be made at least twenty six days before the date of the General Meeting.
The shareholder or shareholders representing at least one twentieth of the share capital may demand placing
certain matters in the agenda of the nearest General Meeting. The demand should be proposed to the Board not
later than twenty one days before the established date of the General Meeting. The demand should contain
justification or draft resolution concerning the proposed item of the agenda. The demand may be put forward in
the electronic form.
The shareholders may take part in the General Meeting and exercise their voting right personally or through
their representatives. According to the rule of free voting of the shareholder, the shareholder may vote
differently of each of the shares held.
Authorization for participation in the General Meeting and to exercise ones voting right is granted in writing and
it is attached to the minutes of the General Meeting or in the electronic form. In the case of the authorization
granted in a foreign language it is attached to the minutes together with its relevant certified translation into
Polish language.
One share provides with one vote. The Issuer did not issue shares with vote privilege.
Voting is open. Voting by secret ballot is ordered in the cases of appointments for members of the company
authorities and its liquidators and in the cases of voting about their dismissal, voting about bringing the above
mentioned persons to justice, in personnel matters, on the proposal at least one shareholder or their
representative.
The resolution concerning the change of the subject of the company’s business activity is passed in an open
roll-call voting.
According to content of art. 411 of the Code of Commercial Companies, shareholder is granted their voting right
from the day of covering the shares.
Regardless of other matters stipulated by the legal regulations, the following matters are included in the
competences of the General Meeting:
a) Examination and approval of the Board report concerning the Company’s activity and also the
financial statement, including balance and profit and loss account for the previous financial year
and providing the members of the Company’s bodies with a vote of approval concerning fulfillment
of their duties
b) Agreement for enacting law of usufruct concerning all properties belonging to the Company or
movables of market value as at the day of enacting the law of usufruct amounting to at least PLN
20,000.00,
c) Agreeing for sales or purchase of real estate by the Company
d) Passing a resolution concerning further existence of the Company if the requirement of passing
such the resolution results from the binding legal regulations,
e) Increasing or decreasing the Company’s share capital,
f) Issuance of bonds,
g) Appointing the liquidator of the Company,
h) Other issues which, in accordance with the commonly binding legal regulations are included in the
competences of the General Meeting.
Page 18 of 23
C. Personnel and the rules of conduct for supervising and administrating bodies and their
committees:
In the financial period the following persons were the members of the Company’s Board:
Janusz Schwark – the President of the Board,
Andrzej Baranowski - Financial Vice- President of the Board,
Arkadiusz Czysz - Commercial Vice- President of the Board.
No changes in the personnel of the Board took place in the year 2014.
In accordance with the regulations included in the Articles of Association, the Board carries out the Company’s
issues and represents the Company, so the scope of their entitlements does not diverge from the scope defined
by the regulations of the Code of Commercial Companies.
In the financial period the following persons were the members of the Company’s Supervisory Board:
Andrzej Borowiński,
Hans Christian Bestehorn,
Henrik Kehren,
Hans Jurgen Katzer,
Stephan Bestehorn,
Marek Dietl.
No changes in the personnel of the Supervisory Board took place in the year 2014.
The Supervisory Board is obliged to run the current control over the Company’s activity in all its aspects:
The following actions require the Supervisory Board’s agreement or opinion expressed in the form of the
resolution:
a) Establishing or change of plans within long-term and intermediate economic policy
of the Issuer;
b) Approval of financial and investment plan for the consecutive financial year;
c) Purchase and sales of the enterprise or an organized part of the enterprise;
forming and liquidation of branch offices and non-resident plants if such
transaction was not stipulated in the Company’s financial plan, with reservation to
the absolutely binding legal regulations;
d) Change of the objects of the Issuer’s activity, with reservation to the absolutely
binding legal regulations;
e) Purchasing and disposing of participation titles by other entrepreneurs
f) Concluding, amending and terminating the agreement of lease or lending the
enterprise and also other agreements concerning the enterprise as a whole or an
organized part of the enterprise, if these agreements were not stipulated in the
Issuer’s financial plan, with reservation to the absolutely binding legal regulations;
g) Taking out or granting loans, credits, liabilities on bills of exchange, if they were
not stipulated in the Issuer’s financial plan and if they exceed the net amount
constituting the total equivalent of EUR 150,000.00 in Polish zlotys yearly; loans
granted to the Company’s employees which individually do not exceed their double
gross monthly salary are exempted from the above limitation
h) Establishing security, in particular granting guarantees, promises of benefit, if they
were not stipulated in the Issuer’s financial plan and if they in an individual case
exceed the total amount of responsibility constituting the net equivalent of EUR
100,000.00 in Polish zlotys yearly;
i) Concluding agreements of lease, rental, license agreements and other similar
agreements of long-term effect when the effective period of the individual
agreement exceeds thirty six months or if monthly liability for the Company
resulting from such the agreement exceeds the amount constituting the total net
equivalent of EUR 5,000.00 in Polish zlotys, unless this agreement was stipulated
in the Issuer’s financial plan;
j) Concluding, amendment or termination of agreements of purchase or sales of
industrial property rights (patents, utility models, trademarks, inventions, etc.)
know-how secrets and similar rights, if such the agreements were not stipulated in
the Issuer’s financial plan;
Page 19 of 23
k) Concluding, amendment or termination of agreements of performing work or
similar agreements with authorized persons and other persons holding managerial
posts in the Company, if these agreements stipulate longer than statutory term of
notice or participation in the Company’s profit or if they are dependent on the
Company’s turnover or if a yearly remuneration exceeds the net equivalent of EUR
70,000.00 (seventy thousand) in Polish zlotys;
l) Concluding, amendment or termination of agreements, particularly agreements of
performing work with shareholders holding shares representing at least 5% of the
general number of votes in the Company, with their spouses, children or
grandchildren and establishing remuneration for these subjects;
m) Concluding agreements stipulating the participation in the Issuer’s profit,
concluding life-insurance and similar agreements;
n) Establishing or change of general rules of occupational pension schemes and
concluding, change or termination of pension agreements with individual
employees.
The Supervisory Board is entitled to take the following actions:
a) Evaluation of financial statements, including balance, profit and loss accounts considering their
consistency with the books and documents and current financial state of the Company;
b) Evaluation of the Board report and motion of distribution of shares or loss covering;
c) Delivering a written yearly statement of results of actions stipulated in a) and b) to the General
Meeting;
d) Temporary suspension, on important reasons, a member of the Board or all members of the Board in
performing their functions and delegating a member of the Supervisory Board to temporarily perform
the function of the Board member in place of the suspended member of the Board;
e) Representing the Company in agreements and disputes with a member of the Board;
f) Calling the Ordinary General Meeting if the Board do not call it within the date defined by the
regulations and calling the Extraordinary General Meeting if they consider calling it necessary;
g) Dismissing the president of the Board and other members of the Board, with reservations to the rules
of the Company Articles of Association;
h) Granting approval for concluding an agreement or transaction between the Company and an affiliated
subject, except typical transactions or agreements concluded on market conditions within operational
activity between the Company and the subsidiary subject where the Company holds a majority stake;
i) Selecting a statutory auditor to audit annual financial statements of the Company.
The Supervisory Board exercising their entitlements have access to each of the Company’s field of matters,
they may demand reports and statements from the Board and the Company workers, as well as they may take
up the control of the Company’s property, books and documents. Every member of the Supervisory Board is
provided with access to the Company’s property and rooms on demand.
In the Issuer’s enterprise there are Regulations of the Supervisory Board which defines basic duties and rules of
the Issuer’s body functioning.
The regulations stipulate that each member of the Supervisory Board ought to have proper education and
professional and life experience, demonstrate high moral level and be able to devote necessary amount of time,
allowing them to properly perform their functions in the Supervisory Board. In their actions each member of the
Supervisory Board is obliged to pursue the Company’s interest and independence of judgment and opinion.
The member of the Supervisory Board ought to inform other members of the Supervisory Board of a conflict of
interests or a possibility that it may arise. The conflict of interests is defined as a group of events that may
cause a suspicion of lack of objectivity towards the Company on account of a member of the Supervisory Board
or their relatives. In that case the member of the Supervisory Board is obliged to abstain from taking the floor
on the matter where the conflict of interest arose.
The members of the Supervisory Board pursue most of all the Issuer’s interest in their actions.
In the financial year 2014 the audit committee (further referred to as “the Committee”) functioned within the
Supervisory Board. Its personnel was as follows:
- Marek Dietl – Chairman of the Audit Committee
- Henrik Kehren – Member of the Audit Committee,
- Andrzej Borowiński – Member of the Audit Committee.
Page 20 of 23
The Audit Committee is a permanent committee of the Company’s Supervisory Board and performs consulting-
advisory functions for the Company’s Supervisory Board.
In accordance with the Committee’s regulations (passed by the Company’s Supervisory Board), the
Committee’s duties involve:
a) Monitoring the process of financial reporting, including giving opinions on the
accountancy policy adopted by the Company and the rules of drawing up financial
statements, including verification of significant assumptions and estimations made for
drawing up financial statements,
b) Discussing annual, semi-annual and quarterly financial statements with the Company
bodies,
c) Monitoring actions connected with financial review, including discussion on the results of
the annual financial statement and also evaluation of adequacy of statutory auditor’s
involvement in relation to the content and publishing financial statements other than
annual and semi-annual financial statements by the Company,
d) Giving opinion on the Company’s Board (further referred to as “the Board”) report on
the activity and the Board’s conclusions concerning distribution of profit/ covering of loss
and presenting the Supervisory Board with recommendations concerning their evaluation,
e) Presenting the Supervisory Board with recommendations concerning the Company’s
statutory auditor and rules of remunerating them,
f) Monitoring independence of the statutory auditor’s and the subject authorized to audit
financial statements, including giving opinion of the scope of additional work
commissioned by the Board to the statutory auditor,
g) Monitoring the effectiveness of management system and control of the risk management
system significantly affecting the Company’s functioning.
h) Monitoring and consulting performed for the Board about effectiveness of the Company’s
system of internal control, including effectiveness of remedial actions taken,
i) Supervision of functioning of the internal audit through giving opinion on their
regulations, work plans and resources,
j) Giving opinion on a candidate for the post of the Company’s internal auditor, on their
dismissal and remuneration,
k) Supervision of applying the recommendations and observations of internal auditors and
statutory auditors,
l) Monitoring the consistency of the Company’s actions with legal regulations and other
regulations,
m) Giving opinion on significant financial information published by the Company,
n) Supervising and controlling the regulations and stipulations concerning the rules of
workers reporting possible irregularities within the area of financial reporting or other
matters; tools which enable confidential reporting of irregularities and investigating such
matters should also be subjects to supervision and control.
The Committee have the right to investigate each matter within their responsibility and use the means
necessary to perform their work, including:
a) Receive information from the Company’s bodies and employees who are obliged to provide
the members of the Committee with the information and access to it,
b) Participate in deliberations and meetings of the Company’s employees,
c) Invite external advisors to the Committee sessions and ask their advice and opinion. The
Company incurs the cost of their services after the Supervisory Board has accepted it.
In accordance with the above mentioned regulations, the Committee performs their functions collegially. The
President of the Committee manages the work of the Committee. The Committee debate as frequently as it is
necessary for effective realizations of their tasks.. Each member of the Committee, the Supervisory Board and
the Board has the right to submit a matter to the Committee meeting.
The Committee’s resolution are passed by consensus or by ordinary majority of votes through voting as a result
on proposal of any of the Committee members. In the case of equal number of votes “for” and “against” the
vote of the Committee President is decisive. When necessary, the Committee may pass resolutions outside the
session, in the mode defined by the Committee regulations.
Once a year the Committee draws up a report on their sessions and establishments and delivers it to all the
members of the Supervisory Board (the report for each consecutive calendar year is drawn up and delivered by
the end of the first quarter of the consecutive year).
Page 21 of 23
Each member of the Committee and each person invited to participate in the sessions or cooperation with the
members is obliged to maintain all information gained in relation to the investigated matters in secret, except
for public information.
D. Description of main features of systems of interior control and risk management concerning
the process of drawing up financial statements.
In the Company a separate organizational section selected especially for this purpose is responsible for the
control over all the process of drawing up financial statements and consolidated financial statements. The
section is also responsible for promptness of delivering current and periodical reports.
Among the basic regulations concerning drawing up financial statements are the rules of accounting policy
applied both by the Issuer and the capital group.
Moreover, the evaluation of accuracy and correctness of the financial statement and consolidated financial
statements is performed by an independent Statutory Auditor.
40. Demonstrating owners of any securities which provide special controlling entitlements
The Company did not issue any securities providing special controlling entitlements.
41. Demonstrating limitations concerning exercising the voting right:
Under the Agreement of 15 April 2008 the following shareholders: Colorpack Verpackungen mit System GmbH
(also referred to as: „Colorpack GmbH”), Arkadiusz Czysz, Janusz Schwark, Violetta Schwark, Anna Schwark
and BSC Invest V. Schwark, J. Schwark, A. Czysz Sp. j. – the parties of the agreement pledged to common
representation on the General Meeting, which means unanimous voting of all shareholders on the General
Meeting of the Issuer in all matters included in the agenda of the General Meeting; the shareholders decide on
the voting method by the majority of 67% votes, they also gave permanent and irreversible authorization to
exercise the voting right concerning the Issuer’s shares (reserving the possibility of unanimous revoking the
power of attorney by all signatories to the decision).
42. Demonstrating limitations concerning transferring the proprietorship of securities of BSC
Drukarnia Opakowań S.A:
Under the Agreement of 15 April 2008 the following shareholders: Colorpack Verpackungen mit System GmbH,
Arkadiusz Czysz, Janusz Schwark, Violetta Schwark, Anna Schwark and BSC Invest V. Schwark, J. Schwark, A.
Czysz Sp. j. – the parties to the agreement obliged to refrain from disposal or transferring to other type of
ownership all the Issuer’s shares owned by them for the period of three years counted from the first listing of
the Issuer’s shares on the regulated market run by Warsaw Stock Exchange S.A., that is until 4 January 2014.
In the case of infringing the pledge, the shareholder who committed the infringement is obliged to pay the
other shareholders a contractual fine of total amount of double value of the sold or transferred shares within
the period of 14 working days from the day of delivering a written summons by any of the shareholders.
For the effective period of the relevant agreement, the IDMSA Brokerage House deposited (blocked) the
shares.
43. Description of rules of appointing and dismissing managing persons and their entitlements, in
particular the right to decide on issuance or buyout of shares:
The Members of the Board are appointed and dismissed by the General Meeting of Shareholders by the majority
of votes.
In accordance with the Company’s Articles of Association, if the General Meeting does not pass the resolution
concerning appointing the president of the Board, the shareholder – the company BSC Invest V. Schwark, J.
Schwark, A. Czysz Sp. j. on the condition of holding individually or together with the shareholders: Janusz
Schwark, Arkadiusz Czysz, Violetta Schwark, Anna Schwark at least 20% shares in the Issuer’s share capital
may, in the period of two months from the day of the General Meeting who did not pass the resolution
concerning appointing the president of the Board, propose the shareholder Colorpack Verpackungen mit System
GmbH two candidates for the above mentioned post together with a written justification of their choice and the
shareholder Colorpack Verpackungen mit System GmbH has, on the condition of holding at least 20% of the
Issuer’s shares, the right to appoint one of the two proposed candidates for the post of the president of the
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Board in the period of one month from the date of receiving the written information concerning the proposed
candidates. If the shareholder Colorpack Verpackungen mit System GmbH does not appoint the president of the
Board in the period of one month, BSC Invest V. Schwark, J. Schwark, A. Czysz Sp. j. has the right to
independently appoint the president of the Board out of the two candidates presented by them in the period of
two weeks from the ineffective expiration of the due date for appointing the president of the Board by
Colorpack Verpackungen mit System GmbH. Not exercising the personal right by BSC Invest V. Schwark, J.
Schwark, A. Czysz Sp. j. in the due date causes transferring the entitlement to appoint the president of the
Board again to the General Meeting, still appointing the president of the Board requires ordinary majority of
votes.
The candidates for the president of the Board should meet one of the requirements presented below:
- Have higher education with the major in: printing, economics, law, management, marketing or other
major preparation to run a company;
- Have at least three years of experience in printing on a managerial post or on a post involving
management of a company.
If the General Meeting does not pass the resolution concerning appointing the financial vice-president of the
Board, the shareholder – Colorpack Verpackungen mit System GmbH on the condition of holding at least 20%
shares in the Issuer’s share capital may, in the period of two months from the day of the General Meeting who
did not pass the resolution concerning appointing the financial vice-president of the Board, propose the
shareholder BSC Invest V. Schwark, J. Schwark, A. Czysz Sp. j., two candidates for the above mentioned post
together with a written justification of their choice and the shareholder: BSC Invest V. Schwark, J. Schwark, A.
Czysz Sp. j. has, on the condition of holding at least 20% of the Issuer’s shares, the right to appoint one of the
two proposed candidates for the post of the financial vice-president of the Board in the period of one month
from the date of receiving the written information concerning the proposed candidates. If the shareholder BSC
Invest V. Schwark, J. Schwark, A. Czysz Sp. j. does not appoint the financial vice-president of the Board in the
period of one month, Colorpack Verpackungen mit System GmbH has the right to independently appoint the
financial vice-president of the Board out of the two candidates proposed by them in the period of two weeks
from the ineffective expiration of the due date for appointing the financial vice-president of the Board by BSC
Invest V. Schwark, J. Schwark, A. Czysz Sp. j.. Not exercising the personal right by Colorpack Verpackungen
mit System GmbH in the due date causes transferring the entitlement to appoint the financial vice-president of
the Board again to the General Meeting, still, appointing the financial vice-president of the Board requires
ordinary majority of votes.
The candidates for the financial vice-president of the Board should meet one of the requirements presented
below:
- Have higher education in economics;
- Have at least three years of experience on a post involving the responsibility for financial matters of
companies.
According to the Articles of Association, if the Issuer’s shares held by BSC Invest V. Schwark, J. Schwark, A.
Czysz Sp. j. are transferred for the benefit of natural persons: Arkadiusz Czysz, Violetta Schwark, Anna
Schwark or Janusz Schwark, the shareholders are due to all entitlements of BSC Invest V. Schwark, J. Schwark,
A. Czysz Sp. j. mentioned above, on the condition that the shareholders Arkadiusz Czysz, Violetta Schwark,
Anna Schwark and Janusz Schwark together hold at least 20% of the Issuer’s shares. The above named
shareholders exercise the already mentioned personal entitlements, taking decisions by ordinary majority of
votes.
With reservation of the rights due to the General Meeting, the President of the Board and the financial Vice –
President and other members of the Board may be dismissed by the Supervisory Board with immediate effect,
every time with providing the reasons of the dismissal, on the stipulation of the decisions presented below.
If BSC Invest V. Schwark, J. Schwark, A. Czysz Sp. j. independently or together with the shareholders- natural
persons: Arkadiusz Czysz, Janusz Schwark, Violetta Schwark and Anna Schwark hold at least 20% of the
Issuer’s shares, the Supervisory Board may dismiss the president of the Board only because of severe and/or
repeated infringement of the decisions of the Issuer’s Articles of Association, management agreement, the
Board’s Regulations or absolutely binding legal regulations. The severe infringement occurs when through
culpable actions or nonfeasance, damages caused by the president of the Board or damages which may occur
as a result of culpable actions or nonfeasance of the president of the Board caused or might cause a fiscal or
financial loss for the Issuer exceeding the equivalent in Polish zlotys of EUR 100,000 or in the case when the
president of the Board led to a culpable long-term deterioration in relationships with important customers or
suppliers or if the president of the Board perpetrated other culpable actions harming important economic
enterprise of the Company. If the infringement actions are stated, the Supervisory Board will inform the
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president of the Board at the same time calling for abstaining from the mentioned actions. If the president of
the Board immediately, and not later than in the period of 5 days from the day of delivering of the notice of the
Supervisory Board does not abstain from committing infringement, it means committing severe infringement.
The Supervisory Board’s resolution concerning the dismissal of the president of the Board may be passed only
on the meeting when all the members of the Supervisory Board are present. If not all the members of the
Supervisory Board are present, then within 7 days a new meeting must be called in whose agenda must include
the resolution concerning the dismissal of the president of the Board. In that case, the Supervisory Board will
be able to pass resolutions on the basis defined in the Code of Commercial Companies.
Severe infringement occurs always when the president of the Board acts without the Supervisory Board’s
approval in cases defined in the Issuer’s Articles of Association.
Another appointment of the dismissed president of the Board is not possible, unless the president of the Board
was dismissed in the way contradictory to the Articles of Association, the Board’s regulations, management
agreement or absolutely binding legal regulations.
If the duties resulting from the decisions of the Board’s Regulations are not fulfilled or are improperly fulfilled
by a member of the Board and if a member of the Board performs actions to the detriment of the Issuer,
particularly including actions contradictory to the Board’s actions, the president of the Board may put forward a
proposal to the Supervisory Board of dismissing the member of the Board. The member of the Board should be
dismissed from the post held within 30 days from the date when the proposal of dismissal was put forward by
the president of the Board.
All matters connected with running the Company, not reserved by an act or the Constitution for the
competences of the General Meeting or the Supervisory Board are included in the Board’s activity.
Every member of the Board independently is entitled to make a declaration of intent on behalf of the Issuer.
The Board in particular is entitled to purchase own shares on behalf of the Company in order to amortize after
receiving the General Meeting’s approval. The Board’s entitlements concerning the right to decide about the
buyout of shares do not diverge from the regulations included in the Code of Commercial Companies.
44. Description of rules for changing the Company’s Articles of Association:
The change of the Company’s Articles of Association occurs when in accordance with the absolutely binding
regulations, in particular art. 430 and subsequent of the Code of Commercial Companies, that is according to
the procedures of a resolution passed on the General Meeting of Shareholders.
45. Declarations of the Board.
We declare that, to the best of our knowledge and belief, the annual financial statement as at 31.12.2014 and
comparable data were drawn up in accordance with the binding accountancy rules and that they truly,
accurately and clearly reflect the property and financial situation of the Issuer and their financial result.
Moreover, we declare that the annual statement of the Issuer’s activity contains a true view of the Issuer’s
development and achievement and situation, including the description of the basic threats and risks.
We declare that the subject authorized to audit financial statements, carrying out the audit of the annual
separate financial statement for the period from 1 January 2014 to 31 December 2014 was selected in
accordance with the legal regulations and the subject is: 4AUDYT Sp. z o.o. The subject and statutory auditors
carrying out the audit of the above mentioned statements meet the requirements to issue an objective and
independent opinion on the annual separate financial statement, in accordance with the binding legal
regulations and professional norms.
Janusz Schwark Arkadiusz Czysz Andrzej Baranowski
President of the Board Vice-President of the Board Vice-President of the Board
Poznań, 20-03-2015