Equity and liabilities
Equity
The changes in equity in the financial year are shown separately in the consolidated statement of changes in equity.
(15) Subscribed capital
The fully paid-in share capital of the Company amounts to EUR 29,459,415.00.
It is divided into 29,459,415 no-par shares issued in the name of the bearer. Each share therefore has a theoretical value of 1.00 euro.
The Supervisory Board determines the form of the share certificates as well as dividend and renewal coupons. The same applies to bonds.
The Company may issue multiple share certificates (global shares) representing a combination of individual shares. The shareholders have no entitlement to certification of their shares.
The Supervisory Board is authorized to increase the share capital of the Company once or several times until 17 May 2024, by up to a total of 4,418,912.00 euro by issuing new individual bearer shares in return for cash contributions (Authorized Capital 2019).
The shareholders are fundamentally entitled to a subscription right. The shares should be underwritten by banks or other entities that fulfill the prerequisites of Section 186 (5) (1) of the German Stock Corporation Act (AktG) with the obligation to offer them for subscription to the shareholders. However, the Supervisory Board is authorized to exclude this subscription right for shareholders
-
for fractional amounts;
-
if the new shares are issued at a price that is not substantially less than the stock market price, and the shares issued pursuant to Section 186 (3) (4) AktG, subject to the exclusion of the subscription right, do not exceed a total of 10% of the share capital, specifically neither at the time this authorization takes effect nor at the time that it is exercised
The sum total of shares issued in return for cash, subject to the exclusion of the subscription right, may not exceed a proportionate amount of the capital stock of 2,945,941.00 euro. This limit should include shares that are to be issued to service conversion rights or warrants or conversion obligations from bonds (including participation rights) provided that the bonds or participation rights are issued during the term of this authorization subject to the exclusion of the subscription right.
The Supervisory Board is further authorized to determine all additional rights attached to the shares and the conditions governing their issuance.
The Company has not exercised this right to date.
In the previous year, the Supervisory Board was authorized to increase the share capital of the Company once or several times until 29 June 2020 by up to a total of 4,019,000.00 euro by issuing new individual bearer shares (with voting rights) in return for cash contributions (Authorized Capital I). The new shares were to be offered to the shareholders to purchase, whereby an indirect subscription right as defined in Section 186 (5) (1) AktG would also suffice. The Supervisory Board was authorized, however, to exclude subscription rights for fractional amounts from the shareholders. The Supervisory Board was further authorized to set a start date for profit-sharing rights that deviated from legislation, as well as further details relating to the implementation of capital increases from Authorized Capital I. The Supervisory Board was authorized to amend the wording of the Articles of Association after the full or partial implementation of the capital increase from Authorized Capital I or after the expiration of the authorization period in accordance with the scope of the capital increase from Authorized Capital I.
The Company did not exercise this right. At the General Meeting on 17 May 2019, Authorized Capital I was revoked upon the effective date of the new Authorized Capital 2019.
(16) Capital reserves and retained earnings
The composition of, and changes in, the capital reserves and retained earnings are shown in the consolidated statement of changes in equity.
The capital reserves include the premium of kEUR 15,990 from the capital increase from Authorized Capital II approved on 15 August 2017. Costs for the capital increase minus the relevant taxation in the amount of kEUR 138 are deducted from this amount.
Retained earnings reflect the actuarial gains and losses of the pension provisions and income taxes. They amounted to kEUR -97 in 2018 (previous year: kEUR -177).
Retained earnings also include the adjustments to entries with respect to IFRS 15 (Revenue from Contracts with Customers) in the opening statement of financial position as of 1 January 2018. Retained earnings were reduced by a total of kEUR 4,044 as a result of the changeover in accordance with the modified retrospective methods. The adjustments included in this figure are a reduction in trade receivables of kEUR 48,193, an increase in inventories of kEUR 42,543, and an increase in deferred taxes of kER 1,606.
Retained earnings also include an adjustment for the correction of an error in the amount of kEUR -3,478. The correction of the error is discussed in detail in the section "Correction of errors".
(17) Revaluation reserve
Recognized in the revaluation reserve are changes in value from the application of the revaluation reserve in accordance with IAS 16 as well as value adjustments for property, which is reclassified from real estate used by the company to investment property. The amount of kEUR 11,340 is composed of land and buildings that were revalued in 2019 in the amount of kEUR 12,998 as well as related deferred tax liabilities of kEUR 3,703 and kEUR 2,828 from value adjustments for property as a result of its reclassification to investment property, as well as deferred taxes of kEUR 783.
(18) Unappropriated retained earnings
Under German stock corporation law, the amount available for dividend payments to shareholders is based on the unappropriated retained earnings for the year or on the other retained earnings of MAX Automation SE (individual annual accounts) and is determined in accordance with German commercial law. For 2019 unappropriated retained earnings of kEUR -41,778 is reported in the separate financial statements of MAX Automation SE.
The Supervisory Board proposes a dividend payout of 0 euro per share from the unappropriated retained earnings for the year. The corresponding amount to be distributed is kEUR 0.
Capital management
The conditions for optimal capital management are framed by the strategic direction of the MAX Group. The focus is on long-term appreciation in value in the interests of investors, employees and customers through a continuous improvement in operating profit through growth and increased efficiency.
The capital structure is managed in such a way as to keep all options open in the capital markets by maintaining maximum possible flexibility. This enables optimal pricing in the procurement of equity and debt capital.
Non-current liabilities
(19) Non-current financial liabilities
in kEUR |
31/12/2019 |
31/12/2018 |
---|---|---|
Non-current loans excl. current proportion |
120,574 |
76,768 |
Residual term 1-5 years |
120,508 |
76,238 |
Residual term > 5 years |
65 |
530 |
Non-current lease liabilities |
15,438 |
1,405 |
Residual term 1-5 years |
10,831 |
1,216 |
Residual term > 5 years |
4,607 |
188 |
Other non-current liabilities |
300 |
7,988 |
Residual term 1-5 years |
300 |
7,987 |
Residual term > 5 years |
0 |
0 |
Total |
136,312 |
86,159 |
The non-current loans relate to liabilities to banks and include the syndicated loan of the parent company in the amount of kEUR 118,049 (previous year: kEUR 73,322).
In the previous year, other non-current liabilities essentially included purchase price payments in connection with MAX Automation (Shanghai) Co. Ltd.
Non-current debt less current portion
At the end of July 2017, MAX Automation SE increased the syndicated loan taken out in 2015 and extended it at the same time until 2022. An increase of mEUR 40 in the syndicated loan to a total of mEUR 190 was agreed (including a guarantee facility for advance payments, warranties and contract performance). MAX Automation took advantage of the continuing favorable financing terms to increase the syndicated loan. The agreement includes improved conditions and beneficial framework conditions (covenants) which relate to the consolidated financial statements prepared in accordance with the IFRS regulations. They are based on key figures from the statement of financial position and earnings. In 2019, the MAX Group adhered to all the covenants agreed with the lending banks or the review was suspended beginning in the third quarter.
The liabilities from the syndicated loan are reported under long-term loans and not under short-term loans at the Company's discretion.
On 18 February 2020, the Company filed an application for contract modification at the administrative office for the syndicated loan contract. The essential objective of this application for a contract modification was a readjustment of the covenants of the syndicated loan. On 28 February 2020, the bank syndicate accepted the application.
The enterprises included in the syndicated loan are jointly and severally liable for the obligations under this contract. A drawdown is considered unlikely as the creditworthiness of the debtors is ensured by their affiliation with the MAX Group. The interest rate on the syndicated loan depends on the statement of financial position ratios in the consolidated financial statements. The interest rate is based on the EURIBOR plus an additional margin resulting from the key ratios.
The loans in the Group are subject to fixed and variable interest rates. The interest rates were between 1.40% and 3.80% in 2019, depending on the term of the contract.
(20) Provisions for pensions
The pension provisions recognized in the statement of financial position result from commitments to employees of a subsidiary. The defined benefit obligations in the MAX Group are not financed through funds.
The following main assumptions were made in the actuarial calculations:
in kEUR |
31/12/2019 |
31/12/2018 |
---|---|---|
Interest rate |
0.80% |
2.05% |
Salary growth |
1.5% |
1.5% |
Pension indexation |
2.0% |
2.0% |
Aggregate flucutuation |
None |
None |
Aggregate retirement age |
65 |
65 |
Cost trends in health care were not taken into account in the actuarial assumptions.
The present value of the pension obligations developed as follows:
in kEUR |
31/12/2019 |
31/12/2018 |
---|---|---|
As of 01/01/ |
950 |
963 |
Service cost |
0 |
0 |
Interest cost |
19 |
19 |
Actuarial gains/losses |
133 |
21 |
Pensions paid |
-54 |
-53 |
Offsetting of pension liability insurance |
0 |
0 |
Pension provisions |
1,048 |
950 |
Actuarial gains and losses were recorded outside profit or loss.
The development of pension obligations over the past five years is shown in the following table:
in kEUR |
2019 |
2018 |
2017 |
2016 |
2015 |
---|---|---|---|---|---|
Balance sheet value of pension provisions |
1,048 |
950 |
963 |
1,033 |
1,082 |
Allocated plan assets |
0 |
0 |
0 |
0 |
0 |
Experience suggests that no significant adjustments to pension obligations are expected.
In 2020, in addition to the pension payments (kEUR 55), it is likely that pension costs (interest and current service cost) will amount to kEUR 141.
A sensitivity analysis was not carried out with respect to the pension obligations due to their relative insignificance for the net assets, financial position and results of operations of the MAX Automation Group.
(21) Trade payables
in kEUR |
2019 |
2018 |
---|---|---|
Trade payables |
22,900 |
41,325 |
Prepayments received which do not relate to production orders |
16,971 |
51,640 |
Liabilities from deliveries still to be invoiced and outstanding assembly services |
8,589 |
7,227 |
Obligations to subcontractors |
1,359 |
337 |
Trade payables |
49,818 |
100,529 |
(22) Contractual liabilities
Contract liabilities |
in kEUR |
---|---|
01/01/2019 |
30,193 |
Revenue included in contract liabilities at the beginning of the period |
-8,534 |
Increase due to customer payments received less the amount recognised as revenue during the period |
15,322 |
Changes due to the adjustment of progress |
-18,227 |
Other changes |
-118 |
31/12/2019 |
18,637 |
The change resulted primarily from the processing of projects for which advance payments were received in the previous year.
(23) Current loans and current portion of non-current loans
Current bank loans of kEUR 1,327 (previous year: kEUR 5,325) were drawn on at interest rates which are calculated at the usual market conditions.
(24) Liabilities to related companies
Liabilities to related companies from the previous year resulted from trade payables to ESSERT GmbH in the amount of kEUR 137.
(25) Other current financial liabilities and lease liabilities
in kEUR |
31/12/2019 |
31/12/2018 |
---|---|---|
Salaries and wages |
8,731 |
7,515 |
Holiday pay and overtime |
3,692 |
3,903 |
Social security liabilities |
854 |
780 |
Customers with credit balances |
424 |
1,155 |
Negative fair values of derivative financial instruments |
124 |
57 |
Obligations from purchase contracts |
0 |
3,974 |
MAX Shanghai purchase price due |
0 |
500 |
Other current liabilities |
1,845 |
2,166 |
Total |
15,670 |
20,050 |
Lease liabilities |
4,257 |
261 |
Total lease liabilities |
4,257 |
261 |
The obligations from purchase contracts in the amount of kEUR 3,974 result from the sale of Finnah Packtec GmbH (formerly: NSM Packtec GmbH) which belonged to the MAX Group until 9 March 2018. This is offset by a receivable of the same amount. This obligation has been settled by the payment of a drawn down payment guarantee.
Wages and salaries include bonuses and profit shares amounting to kEUR 8,243 (previous year: kEUR 6,695).
Regarding lease liabilities, please refer to the separate section on the initial application of IFRS 16.
(26) Provisions and liabilities from income taxes
Taxes and charges incurred commercially up to the date of the statement of financial position but still to be quantified are covered by the provisions for taxes. The MAX GROUP is typically subject to two types of income tax in Germany: trade tax and corporation tax.
The uniform tax rate of 15% plus a 5.5% solidarity surcharge applies to corporation tax, while the trade tax rate is about 14% on average, resulting in an average domestic tax rate of 29.83%. Outside Germany, the MAX Group primarily generates taxable income in the USA. The average tax rate in the USA is 22.58 %.
Provisions for taxes have developed as follows:
in kEUR |
31/12/2018 |
Changes in the scope of consolidation |
Depletion |
Releases |
Additions |
31/12/2019 |
---|---|---|---|---|---|---|
Corporation tax with solidarity surcharge |
1,610 |
0 |
-1,276 |
-85 |
816 |
1,065 |
Trade tax |
2,174 |
0 |
-1,615 |
-184 |
444 |
818 |
Other Taxes |
151 |
0 |
-30 |
0 |
142 |
263 |
Total provisions |
3,935 |
0 |
-2,921 |
-270 |
1,402 |
2,146 |
Tax liabilities |
390 |
0 |
-390 |
0 |
62 |
62 |
Provisions and liabilities from income taxes |
4,325 |
0 |
-3,311 |
-270 |
1,464 |
2,208 |
The changes from currency translation are negligible and are therefore not shown separately but are included in the additions to provisions.
Further explanatory notes on income taxes are provided in section 35 "Income taxes".
(27) Other provisions
The other provisions are comprised as follows:
in kEUR |
31/12/2018 |
Usage |
Reversals |
Reclassification |
Additions |
Changes in scope of consolidation |
31/12/2019 |
---|---|---|---|---|---|---|---|
Non-current warranty provisions |
3,746 |
2,705 |
71 |
65 |
1,423 |
0 |
2,456 |
Non-current personnel cost provisions |
1,265 |
66 |
0 |
0 |
560 |
0 |
1,759 |
Other miscellaneous non-current provisions |
9 |
0 |
0 |
0 |
0 |
0 |
9 |
Total other non-current provisions |
5,020 |
2,772 |
71 |
65 |
1,983 |
0 |
4,224 |
Warranty provisions |
3,532 |
335 |
1,563 |
65 |
3,522 |
0 |
5,092 |
Personnel cost provisions |
358 |
98 |
78 |
0 |
306 |
0 |
487 |
Other miscellaneous provisions |
5,623 |
2,153 |
1,641 |
1 |
8,278 |
62 |
10,045 |
Total other current provisions |
9,513 |
2,587 |
3,282 |
64 |
12,106 |
62 |
15,625 |
Warranty and guarantee provisions
Liabilities were recognized for warranty and guarantee obligations for sold products. Measurement was based on figures from past experience. The assumptions underlying the calculations are based on currently available information about complaints for all sold products within the warranty or guarantee period. It is expected that the costs will accrue within the respective warranty periods.
Miscellaneous other provisions
Miscellaneous other provisions include all obligations and risks from which the Group is likely to incur an outflow of funds that can be reliably estimated. They cover various obligations for such items as restructuring in the amount of kEUR 3,592 (previous year: kEUR 0), legal costs/damages of kEUR 1,785 (previous year: kEUR 678), audit and consultancy costs of kEUR 1,622 (previous year: kEUR 1,856), subsequent invoices of EUR 910 (previous year: kEUR 665) and miscellaneous of kEUR 2,137 (previous year: kEUR 2,423). It is expected that the costs will accrue within the next fiscal year.
Other provisions correspond to the best possible estimate of costs to arise in the future. The changes from currency translation are negligible and are therefore not shown separately but are included in the additions to provisions.
(28) Other current liabilities
This item in the amount of kEUR 4.479 (previous year: kEUR 4,950) mainly consists of wage tax and church tax in the amount of kEUR 2,305 (previous year: kEUR 1,505) and value added tax in the amount of kEUR 2,174 (previous year: kEUR 3,444).
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