receivable, with the aim of:
i) limiting the credit granted to customers;
ii) analyzing old operations and the recoverability of
amounts owed;
iii) analyzing customers’ risk profiles.
Liquidity risk
The current situation of financial markets has made li-
quidity risk more important. Systematic financial plan-
ning based on cash flow forecasting for more than one
scenario and for periods longer than a year has become
obligatory in the Ibersol Group. Short-term cash is su-
pported in annual planning, which is revised quarterly
and adjusted daily. Associated to dynamics of the subja-
cent businesses, the Ibersol Group’s cash position has
been governed by flexible management of commercial
paper and the negotiation of available credit lines at all
times. The policy of open dialogue with all financial par-
tners has enabled a relationship with a high degree of
trust, despite the liquidity restrictions affecting Portu-
guese banks. In 2012 the Ibersol Group favoured liqui-
dity risk in detriment to cost and has been strengthening
medium and long-term financing, resulting from the
substitution of short-term lines, with some surpluses
to constitute applications. Liquidity risk management
also involves maintaining a comfortable level of liquid
assets. Ibersol ended financial year 2012 with about 26
million euros in liquid assets, of which 19 million are
term deposits, representing about 35% of remunerated
liability. But the lower liquidity risk means higher risk for
the application of cash surpluses.
Capital risk
The company tries to maintain an equity capital level ap-
propriate for the nature of the main business (monetary
sales and credit to suppliers) and to ensure continuity
and expansion. The balance of the capital structure is
monitored using the financial leverage ratio (defined as
net remunerated debt/(net remunerated debt + equity
capital)), aiming to keep it within the 35% to 70% range.
Given current market constraints, and for prudential re-
asons, in 2012 we registered a ratio of 19%.
Contingency risk
The financial markets’ unpredictable course may result
in higher financing costs; however, Ibersol firmly belives
that the company will overcome those difficulties.
The sharp fall in consumption over the last year, mainly
in Portugal, will continue to affect foodservice sales, so
we continue to forecast lower sales in 2013. To mitiga-
te the effect on results, the company has adopted strict
cost controls with monthly monitoring of market chan-
ges and consequent review of planned resource uses.
On the other hand, operations in the food area mean
that eventual epidemics, raw-material market fluctua-
tions or consumption pattern changes can have major
impacts on the financial statements.
Environmental
This risk area is coordinated by the Quality Department
and its main activity is the implementation of policy
deriving from Ibersol’s sustainability principles, so that
processes and procedures are guaranteed across the
board, specifically regarding the promotion of responsi-
ble and proactive behaviour when managing resources
and waste.
The training plans ensure that teams know how to ratio-
nally manage water and electric power, and to recycle
used materials and cooking oils.
PROFILE
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