MAKING SCIENCE GROUP, S.A.
Calle López de Hoyos, 135, 3ª, 28002 Madrid
"Registro Mercantil de Madrid al número": A-82861428
Hereinafter "Making Science" or "The Company"
INFORMATION DOCUMENT
EURONEXT GROWTH PARIS
DIRECT ADMISSION TO NEGOTIATION
ADVERTISSEMENT
Euronext Growth is a market operated by Euronext. Companies on Euronext Growth
are not subject to the same rules as companies on a Regulated Market (a main market). Instead they are subject to a less extensive set of rules and regulations adjusted to small growth companies. The risk in investing in a company on Euronext Growth may therefore be higher than investing in a company on a Regulated Market.
The present Information Document does not constitute a prospectus within the meaning of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 of June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71.
The present Information Document has been drawn up under the responsibility of Making Science. It has been reviewed by Renta 4 Corporate, S.A. and has been subject to an appropriate review of its completeness, consistency and comprehensibility by Euronext.
Mr. José Antonio Martínez Aguilar, in his capacity as Chairman of the company's Board of Directors declares that, to the best of his knowledge, the information provided in this Information Document is accurate and that, to the best of his knowledge this Information Document is not subject to any (material) omissions, and that all relevant information is included in this Information Document.
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TABLE OF CONTENTS | ||
1. | GENERAL INFORMATION OF MAKING SCIENCE AND ITS BUSINESS .......... | 1 |
1.1. | Persons responsible for the information contained in the Document: ................................. | 1 |
1.2. | Company Auditor of Accounts: .......................................................................................... | 1 |
1.3. | Company name and complete identification of the Company and its social object: ........... | 2 |
1.4. | Brief exhibition on the history of the company................................................................... | 3 |
1.4.1. History of the Company and evolution of Making Science's shareholding structure: ..3
1.4.2. | Origins and consolidation of the Group......................................................................... | 8 |
1.4.3. | Vision and new alliances ............................................................................................... | 9 |
1.4.4. | Other relevant milestones ............................................................................................ | 10 |
1.4.5. | Milestones to be achieved during the next months ...................................................... | 12 |
1.4.6. | Milestones related to acquisitions................................................................................ | 12 |
1.4.7. | Milestones related to the listing to BME Growth ........................................................ | 17 |
1.5. Reasons why it has been decided to request incorporation into Euronext Growth. .......... | 17 |
1.6. General description of the issuer's business, referencing the activities it carries out, the characteristics of its products or services and its position in the markets in which it operates.
........................................................................................................................................... | 18 | |
1.6.1. | Lines of Activity.......................................................................................................... | 18 |
1.6.2. | Success stories: ............................................................................................................ | 22 |
1.6.3. | Acknowledgments and awards .................................................................................... | 23 |
1.6.4. | Relationship with clients ............................................................................................. | 24 |
1.6.5. | Customer acquisition process ...................................................................................... | 25 |
1.6.6. | Infrastructure and technical facilities........................................................................... | 26 |
1.6.7. | Relevant Markets and expectations of growth............................................................. | 26 |
1.6.8. | Competitors: ................................................................................................................ | 34 |
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1.6.9. | Corporate values and social commitment .................................................................... | 37 |
1.7. | Strategy and Competitive Advantages .............................................................................. | 37 |
1.7.1. | Strategy........................................................................................................................ | 37 |
1.7.2. | Competitive Advantages: ............................................................................................ | 38 |
1.8. | Dependence on trademarks, patents and licenses: ............................................................. | 41 |
1.9. | Diversification Level......................................................................................................... | 41 |
1.9.1. | Clients.......................................................................................................................... | 41 |
1.9.2. | Suppliers ...................................................................................................................... | 43 |
1.10. | Brief description of the group of Issuer Companies. Description of the characteristics and | |
activity of the subsidiaries with significant effect on the valuation or Issuer status.......... | 44 | |
1.11. | Reference to environmental aspects that may affect the Issuer activity ............................ | 45 |
1.12. | Information on significant trends in production, sales and Issuer costs from the end of the | |
last fiscal year to the date of the document ....................................................................... | 45 | |
1.13. | Information of the directors and senior executives of the Company ................................. | 47 |
1.13.1. | Corporate Structure and Board of Directors ................................................................ | 47 |
1.13.2. | Career and professional profile of the management team............................................ | 49 |
1.14. | Information about the Employees: .................................................................................... | 53 |
1.14.1. | Number of Employees, Geographical Distribution and Profile. .................................. | 53 |
1.14.2. | Internal Organization:.................................................................................................. | 54 |
1.15. | Main Shareholders ............................................................................................................ | 54 |
1.16. | Other operations with related parties................................................................................. | 55 |
(i) | Transactions with significant shareholders ................................................................. | 56 |
(ii) | Transactions with managers and directors ................................................................. | 56 |
(iii) | Transactions between persons, companies and entities of the group .......................... | 57 |
1.17. | Financial information, adverse opinions and information of dividend distribution. ......... | 58 |
1.17.1. | Financial Information of 2018 and 2019: .................................................................... | 59 |
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1.17.2. Adverse opinions, denials of opinion, qualifications or limitations of scope by the
auditors. ....................................................................................................................... | 68 | |
1.17.3. | Preliminary Non-Audited Accounts and results from 2020......................................... | 68 |
1.17.4. Cash Position Statement established within three months prior to the scheduled date of
first admission to trading. ............................................................................................ | 69 | |
1.17.5. Description of the dividend policy. ............................................................................. | 69 | |
1.17.6. Information on disputes that may have a significant effect on the Company. ............. | 69 | |
1.18. | Risk Factors....................................................................................................................... | 69 |
1.18.1. Operational and valuation risks ................................................................................... | 70 | |
1.18.2. Risks related to the Company's financing and exposure to interest rates .................... | 74 | |
1.18.3. Risks associated with the digital marketing sector ...................................................... | 74 | |
1.18.4. Risks related to the shares ........................................................................................... | 75 | |
2. | INFORMATION ABOUT THE ISSUER'S SHARES ................................................. | 77 |
2.1. Number of shares for which incorporation is requested, their nominal value. Share capital, indication of whether there are other classes or series of shares and whether securities have
been issued that give the right to subscribe or acquire shares. .......................................... | 77 | |
2.2. Distribution of the shares .................................................................................................. | 77 | |
2.2.1. | Approvals related to the incorporation of the shares to Euronext Growth Paris.......... | 77 |
2.2.2. | Number of shares to be listed ...................................................................................... | 77 |
2.3. Main characteristics of the shares and their corresponding rights for shareholders. Possible limitations concerning the shareholders meeting attendance, vote and appointment of
directors............................................................................................................................. | 77 |
2.4. Description of any condition for the free transmission of the shares, statutory or extra-
statutory............................................................................................................................. | 78 |
2.5. Para-social agreements between shareholders or between the Company and its
shareholders, that might limit the transmission of shares or affect voting rights. ............. | 78 |
2.6. Commitment vetting the sale, transmission or new share issuance, assumed by the shareholders or by the Company in the light of admission for trading on Euronext Growth
Paris................................................................................................................................... | 78 |
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2.7. Description of the statutory provisions required by the regulation of Euronext Growth Paris regarding the obligation to communicate material participations and para-social agreements and the requirements for the exclusion of trading on Euronext Growth Paris and changes in
control within the Company. ............................................................................................. | 78 |
2.8. Description of the functioning of the General Meeting of Shareholders of the Company.80
3. | OTHER RELEVANT INFORMATION....................................................................... | 81 |
3.1. | Stock Option plan:............................................................................................................. | 81 |
3.2. | Main features of the stock on BME Growth and Euronext Growth .................................. | 81 |
3.3. | Share price performance: .................................................................................................. | 82 |
3.4. | Market Disclosures: .......................................................................................................... | 83 |
4. | LISTING SPONSOR AND OTHER EXPERTS OR ADVISORS.............................. | 85 |
Appendix I. Pro forma consolidated financial statements as of 31 December 2019 and as of 31 December 2018 (and agreed-upon procedures report issued on 28 Abril 2020) ... 86
Appendix II. Consolidated financial statements for the year ending on 31 December 2019 | |
(and audit report issued on 28 Abril 2020) ................................................................... | 87 |
Appendix III. Stand-alone financial statements of Making Science Group, S.A. for the year | |
ending on 31 December 2019 (and audit report issued on 28 Abril 2020).................. | 88 |
Appendix IV. Stand-alone financial statements of Making Science Group, S.A. for the year | |
ending on 31 December 2018 (and audit report issued on 25 July 2019) ................... | 89 |
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1. GENERAL INFORMATION OF MAKING SCIENCE AND ITS BUSINESS
1.1. Persons responsible for the information contained in the Document:
Mr. José Antonio Martínez Aguilar, in his capacity as Chairman of the company's Board of Directors, for and on behalf of Making Science Group, S.A., takes responsibility for the contents of this Information Document.
As the party responsible for this Information Document, the Chair of the Board represents that to the best of his knowledge and belief the information set forth in this document is true and accurate, and no relevant information has been omitted.
1.2. Company Auditor of Accounts:
The financial statements of Making Science have been reviewed by Grant Thornton, S.L.P. ("Grant Thornton"), a Single-Member Company having its place of business in Madrid at Calle José Abascal, 56 and bearing tax identification number B-08914830, registered at the Commercial Registry of Madrid in volume 36652, page 133, sheet M-657409 and at the Official Registry of Auditors of Accounts under number S0231. More particularly, the following financial information was drawn up in accordance with Generally Accepted Accounting Practice as approved in Royal Decree 1514/2007 and has been audited by Grant Thornton:
- Making Science Group, S.A.'s pro forma consolidated financial statements as of 31 December 2019 and as of 31 December 2018 (agreed-upon procedures report issued on 28 April 2020, see Appendix I).
- Making Science Group, S.A.'s consolidated financial statements for the year ending on 31 December 2019 (audit report issued on 28 April 2020, see Appendix II).
- The stand-alone financial statements of Making Science Group, S.A. - formerly Make Marketing y Comunicación, S.L. - for the years ending on 31 December 2019 (auditor's report issued on 28 April 2020, see Appendix III) and 31 December 2018 (auditor's report issued on 25 July 2019, see Appendix IV).
The Ordinary General Shareholders Meeting ratified the appointment of Grant Thornton as the Company Auditor of Accounts for the financial years 2019, 2020, and 2021 on 2 July 2020.
Firmado por MARTINEZ AGUILAR JOSE ANTONIO - 52096441S el día 16/10/2020 con un certificado emitido por AC FNMT Usuarios
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1.3. Company name and complete identification of the Company and its social object:
Making Science Group, S.A. is a public limited liability company incorporated indefinitely having its place of business at López de Hoyos, 135, 3ª, 28002 Madrid, bearing tax identification number A-82861428, and registered at the Commercial Registry of Madrid in volume 16082, page 189, sheet 272332.
The Company was incorporated indefinitely under the corporate name Make Marketing y Comunicación, S.L. on 8 January 2001 by public deed executed by Madrid Notary Mr. Manuel Rodríguez Marín, on record in his protocol under number 55, and was registered on the Commercial Registry of Madrid in Volume 16082, Page 186, Section 8, Sheet M-272332, Entry 1 on 22 January 2001.
The Company changed its corporate name to Making Science Group, S.L. on 17 July 2019 by public deed executed by Madrid Notary Mr. Rafael de la Fuente García, on record in his protocol under number 2499, registered at the Commercial Registry of Madrid in Volume 16082, Page 193, Section 8, Sheet M-272332, Entry 13 on 30 July 2019.
On 28 October 2019 the Extraordinary General Meeting held with all the members present or represented resolved to convert to a public limited liability company, and the corporate name was changed to Making Science Group, S.A. on 8 November 2019 by public deed executed by Madrid Notary Mr. Rafael de la Fuente García, on record in his protocol under number 4033, registered at the Commercial Registry of Madrid in Volume 39598, Page 179, Section 8, Sheet M-272332, Entry 18 on 3 December 2019. Pursuant to that corporate conversion, the private limited liability shares were converted into shares that were numbered identically and allocated to the members in the same proportion as their extant holdings as previously elucidated, hence the share capital remained unchanged. The General Shareholders Meeting noted in its minutes that the resolution had been passed unanimously.
The corporate purpose of Making Science is set forth in Article 2 of its Articles of Association (the "Articles of Association"), worded as follows on the date of issue of this Information Document:
The purpose of the Company will consist in:
Providing communication, marketing, advertising, graphic design and consulting services, by way of campaigns to be published in any print, audiovisual or electronic media, as well as by way of purchasing, selling, importing, exporting and/or distributing any type of service, good, brand or idea contributing to that purpose.
Creating radio, television and software programs for electronic media and selling, licensing, exporting and/or distributing them and/or software and/or hardware.
Building, promoting, purchasing and selling and/or leasing any type of rustic or urban properties.
Investing in any type of personal or real goods or assets.
The abovementioned activities may also be developed by the Company fully or partially, by holding interests in other companies with a similar purpose.
If workers should hold own an official degree or appointment, academic qualification or professional membership to carry out the activities included in the corporate purpose, the said activities can only be carried out on behalf of the company, as a corporate activity, by someone holding the required qualification or belonging to the official association legally required.
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1.4. Brief exhibition on the history of the company
1.4.1. History of the Company and evolution of Making Science's shareholding structure:
On the date of issue of this Information Document, Making Science Group has a share capital of 70,062.00 euros, composed of 7,062,300 shares with a par value of 0.01 euros each. The changes in that share capital are traced in the following table:
Increase in the | Par value | ||||||||||||||
Date of public | Type of share | Share capital | Share issue | of | |||||||||||
number of | |||||||||||||||
deed | capital increase | increase | premium | individual | |||||||||||
shares | |||||||||||||||
shares | |||||||||||||||
2001/01/08 | Cash | 100 | €3,006.00 | - | €30.06 | ||||||||||
(incorporation) | |||||||||||||||
2003/02/05 | Cash | 300 | €9,018.00 | - | €30.06 | ||||||||||
2018/12/19 | Cash (par value of | - | €27,976.00 | - | €100.00 | ||||||||||
individual shares) | |||||||||||||||
2018/12/19 | Share split | 3,999,600 | - | - | €0.01 | ||||||||||
(10,000-to-1) | |||||||||||||||
2019/10/28 | Non-cash | 341,997 | €3,419.97 | €1,446,580.03 | €0.01 | ||||||||||
2019/10/30 | Cash | 2,360,000 | €23,360.00 | - | €0.01 | ||||||||||
2020/02/07 | Cash (public | 360,303 | €3,603.03 | €1,149,366.57 | €0.01 | ||||||||||
offering) | |||||||||||||||
Total | 7,062,300 | €70,062.00 | €2,595,946.60 | €0.01 | |||||||||||
2001
Incorporation of the Company
Making Science Group, S.A. (under the name Make Marketing y Comunicación, S.L.) was incorporated on 8 January 2001 with a share capital of 3,006 euros divided into 100 private limited liability shares having a par value of 30.06 euros each. The share capital was paid up in cash without any share issue premium on 8 January 2001 pursuant to the public deed executed by Madrid Notary Mr. Manuel Rodríguez Marín, on record in his protocol under number 55, registered at the Commercial Registry of Madrid in Volume 16082, Page 186, Section 8, Sheet M-272332, Entry 1 on 22 January 2001. The members of Making Science at that time were Gonzalo Verdeja Lizama and María Isabel Junco Torres.
Member | No. of shares | Share | % | |||||||
capital | ||||||||||
Gonzalo Verdeja Lizama and | 100 | €3,006.00 | 100.0% | |||||||
María Isabel Junco Torres | ||||||||||
Total | 100 | €3,006.00 | 100.0% |
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2003
1st share capital increase (cash)
On 5 February 2003 Making Science increased its share capital by 9,018 euros by issuing 300 new private limited liability shares having a par value of 30.06 euros each. The share capital was paid up in cash without any share issue premium on 2 December 2003 pursuant to the public deed executed by Madrid Notary Mr. Javier Pérez de Camino Palacios, on record in his protocol under number 3017, registered at the Commercial Registry of Madrid in Volume 16082, Page 189, Section 8, Sheet M-272332, Entry 2 on 17 December 2003. The members of Making Science at that time were Gonzalo Verdeja Lizama and María Isabel Junco Torres.
Member | No. of shares | Share | % | |||||||
capital | ||||||||||
Gonzalo Verdeja Lizama and | 400 | €12,024.00 | 100.0% | |||||||
María Isabel Junco Torres | ||||||||||
Total | 400 | €12,024.00 | 100.0% |
2016 - 2018
Sale of all the private limited liability shares to The Science of Digital, S.L.
On 18 November 2016 the former members of Making Science Group, S.A. (at that time named Make Marketing y Comunicación, S.L.) and the members of The Science of Digital, S.L. signed an agreement affording The Science of Digital, S.L. the option to purchase up to 100% of the share capital of Making Science Group, S.A. Subsequent to these transactions, The Science of Digital, S.L. became the single member of Making Science Group, S.A.:
Member | No. of shares | Share | % | |||||||
capital | ||||||||||
The Science of Digital, S.L. | 400 | €12,024.00 | 100.0% | |||||||
Total | 400 | €12,024.00 | 100.0% |
2nd share capital increase (cash) and share split
On 19 December 2018, Making Science increased its share capital by 27,976 euros by increasing the par value of each of its 400 private limited liability shares to 100.00 euros. The capital was paid up in cash without any share issue premium, and the 400 private limited liability shares having a par value of 100.00 euros each were split into 4,000,000 private limited liability shares having a par value of 0.01 euros each by the public deed executed by Madrid Notary Mr. Rafael García de la Fuente on 21 December 2018, on record in his protocol under number 3,883, registered at the Commercial Registry of Madrid in Volume 16082, Page 192, Sheet M-272332, Entry 11 on 11 February 2019. The Science of Digital, S.L. was then the single member of Making Science.
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Member | No. of shares | Share | % | |||||||
capital | ||||||||||
The Science of Digital, S.L. | 4,000,000 | €40,000.00 | 100.0% | |||||||
Total | 4,000,000 | €40,000.00 | 100.0% |
2019
3rd share capital increase (non-cash, to bring MCentric Ltd into Making Science)
On 23 October 2019 Making Science increased its share capital by 3,419.97 euros by issuing 341,997 new private limited liability shares numbered from 4,000,001 to 4,341,997, having a par value of 0.01 euros each, with a share issue premium of 1,446,580.03 euros. This share capital increase and share issue premium, totalling 1,450,000.00 euros, took the form of a non-cash contribution of 168,724,775 private limited liability shares of MCentric Ltd. (from its total of 197,078,628 private limited liability shares) by the company Bastiat Internet Ventures, S.L. (50‑% owned by José Antonio Martínez and 50‑% owned by his spouse) on 28 October 2019 by public deed executed by Madrid Notary Mr. Rafael de la Fuente García, on record in his protocol under number 3559, registered at the Commercial Registry of Madrid in Volume 39598, Page 178, Sheet M-272332, Entry 16 on 5 November 2019. After this increase, the members of Making Science were The Science of Digital, S.L., with a 92.1‑% holding, and Bastiat Internet Ventures, S.L., with a 7.9‑% holding.
Prior to this increase, Bastiat Internet Ventures, S.L. was the single member of MCentric Ltd. pursuant to a previous operation whereby it had purchased all the private limited liability shares of MCentric Ltd. from the other members of MCentric Ltd to smooth the way to increase the share capital of Making Science Group, S.A. That share purchase was made subject to the obligation by Bastiat Internet Ventures, S.L. to transfer to the other members of MCentric Ltd. the shareholding to which they were entitled in shares of Making Science Group S.A. after Making Science Group, S.A. had been converted to a public limited liability company and its shares had been recorded as book entries.
Shareholder | No. of shares | Share | % | |||||||
capital | ||||||||||
The Science of Digital, S.L. | 4,000,000 | €40,000.00 | 92.1% | |||||||
Bastiat Internet Ventures, S.L. | 341,997 | €3,419.97 | 7.9% | |||||||
Total | 4,341,997 | €43,419.97 | 100.0% |
Transfer of shares to the former members of Make, Crepes & Texas and I2TIC by the principal shareholder, The Science of Digital, S.L.
To fulfil its obligations after the operations to purchase Make Marketing y Comunicación, S.L., Crepes & Texas, S.L., and Ingeniería para la Innovación I2TIC, S.L., on 28 October 2019 the principal shareholder, The Science of Digital, S.L., transferred a total of 511,874 shares to seven members of those companies (currently executives of the Company), with a deferred payment component for a total minimum amount of 779,000 euros a total maximum amount of 1,137,800 euros. It should be noted that Álvaro Unripe Junco (a former member of Make Marketing y Comunicación, S.L.) acquired 387,483 shares. After these operations, the shareholders of Making Science Group, S.A. were:
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No. of shares | No. of shares after | Share | |||||||||
Shareholder | capital after | % | |||||||||
transferred | transfer | ||||||||||
transfer | |||||||||||
The Science of Digital, S.L. | (511,874) | 3,488,126 | €34,881.26 | 80.3% | |||||||
Álvaro Verdeja Junco | 387,483 | 387,483 | €3,874.83 | 8.9% | |||||||
Bastiat Internet Ventures, S.L. | - | 341,997 | €3,419.97 | 7.9% | |||||||
Another six shareholders | 124,391 | 124,391 | €1,243.91 | 2.9% | |||||||
Total | - | 4,341,997 | €43,419.97 | 100.0% |
4th share capital increase (cash, to procure the minimum share capital required for conversion to a public limited liability company and generate treasury shares)
On 28 October 2019 Making Science increased its share capital by 23,600.00 euros by issuing 2,360,000 new shares numbered from 4,341,998 to 6,701,997, having a par value of 0.01 euros each, to: (i) procure the share capital required for conversion to a public limited liability company and (ii) generate treasury shares before being listed on BME Growth. The share capital increase was paid in, without a share issue premium, by cash contributions by the shareholders according to their shareholdings in the amount of 20,000.00 euros, with the remaining 3,600.00 euros being paid in by José Antonio Martínez Aguilar by public deed executed by Madrid Notary Mr. Rafael de la Fuente García on 30 October 2019, on record in his protocol under number 3921, registered at the Commercial Registry of Madrid in Volume 39598, Page 178, Section 8, Sheet M-272332, Entry 17 on 8 November 2019. The shareholders of Making Science Group, S.A. after this share capital increase were:
Share | |||||||||||
Shareholder | No. of shares | No. of shares after | capital | % | |||||||
subscribed | the increase | after the | |||||||||
increase | |||||||||||
The Science of Digital, S.L. | 1,606,692 | 5,094,818 | €50,948.18 | 76.0% | |||||||
Álvaro Verdeja Junco | 178,481 | 565,964 | €5,659.64 | 8.4% | |||||||
Bastiat Internet Ventures, S.L. | 157,530 | 499,527 | €4,995.27 | 7.5% | |||||||
José Antonio Martínez Aguilar | 360,000 | 360,000 | €3,600.00 | 5.4% | |||||||
Another six shareholders | 57,297 | 181,688 | €1,816.88 | 2.7% | |||||||
Total | 2,360,000 | 6,701,997 | €67,019.97 | 100.0% |
Generation of treasury shares
In order to generate treasury shares before being listed on BME Growth, on 10 December 2019 José Antonio Martínez Aguilar sold the 360,000 shares he had subscribed from the preceding share capital increase to Making Science Group, S.A. at the same price as the subscription price he had paid, that is, at their par value of 3,600.00 euros. Those share would be used in part to set up a system of incentives for Company employees and also to supply a provision for the account required by the Liquidity Provider. The shareholders of Making Science Group, S.A. after this operation were
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Shareholder | No. of shares | Share | % | ||||||
capital | |||||||||
The Science of Digital, S.L. | 5,094,818 | €50,948.18 | 76.0% | ||||||
Álvaro Verdeja Junco | 565,964 | €5,659.64 | 8.4% | ||||||
Bastiat Internet Ventures, S.L. | 499,527 | €4,995.27 | 7.5% | ||||||
Another six shareholders | 181,688 | €1,816.88 | 2.7% | ||||||
Treasury shares | 360,000 | €3,600.00 | 5.4% | ||||||
Total | 6,701,997 | €67,019.97 | 100.0% |
Other share transfers before being listed on BME Growth
On 16 and 17 December 2019 Bastiat Internet Ventures, S.L. transferred 335,189 shares to former members of MCentric Ltd. to fulfil the obligations to those members when MCentric Ltd. entered the share capital of Making Science Group, S.A.
On 16 December 2019 Making Science Group, S.A. transferred 25,000 shares to Company executives.
On 10 December 2019 The Science of Digital, S.L. transferred 20,000 shares to related persons of José Antonio Martínez Aguilar.
On the date of this Information Document, after these operations the shareholders of Making Science Group, S.A. are:
Share | |||||||||||
Shareholder | No. of shares | No. of shares after | capital | % | |||||||
transferred | transfer | after | |||||||||
transfer | |||||||||||
The Science of Digital, S.L. | (20,000) | 5,074,818 | €50,748.18 | 75.7% | |||||||
Álvaro Verdeja Junco | - | 565,964 | €5,659.64 | 8.4% | |||||||
Kuzdu Inc. (Kevin Daly) | 165,016 | 165,016 | €1,650.16 | 2.5% | |||||||
Bastiat Internet Ventures, S.L. | (335,189) | 164,338 | €1,643.38 | 2.5% | |||||||
Another 20 shareholders | 215,173 | 396,861 | €3,968.61 | 5.9% | |||||||
Treasury shares | (25,000) | 335,000 | €3,350.00 | 5.0% | |||||||
Total | 6,701,997 | €67,019.97 | 100.0% |
Public offering on being listed on BME Growth
On 31 January 2020 Making Science increased its share capital by 3,603.03 euros by issuing 360,303 new shares numbered from 6,701,998 to 7,062,300, having a par value of 0.01 euros each, to allow new investors entry on gaining admission to BME Growth. The share capital increase entailed a total share issue premium of 1,149,366.57 euros (3.19 euros per share) by cash contribution, with the entry of 342 new shareholders, pursuant to the public deed executed by Madrid Notary Mr. Rafael de la Fuente García on 31 January 2020, on record in his protocol under number 2020/343, registered at the Commercial Registry of Madrid in Volume 39598, Page 189, Sheet M-272332, Entry 22 on 7 February 2020. On the date of this Information Document, after this public offering, the shareholders of Making Science Group, S.A. are:
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Share | |||||||||||
Shareholder | No. of shares | No. of shares after | capital | % | |||||||
subscribed | the increase | after the | |||||||||
increase | |||||||||||
The Science of Digital, S.L. | - | 5,074,818 | €50,748.18 | 71.9% | |||||||
Álvaro Verdeja Junco | - | 565,964 | €5,659.64 | 8.0% | |||||||
Kuzdu Inc. (Kevin Daly) | - | 165,016 | €1,650.16 | 2.3% | |||||||
Bastiat Internet Ventures, S.L. | - | 164,338 | €1,643.38 | 2.3% | |||||||
Another 362 shareholders | 360,303 | 757,164 | €7,571.64 | 10.7% | |||||||
Treasury shares | - | 335,000 | €3,350.00 | 4.7% | |||||||
Total | 7,062,300 | €70,623.00 | 100.0% |
1.4.2. Origins and consolidation of the Group
The Making Science Group had its inception in 2016 from the vision of José Antonio Martínez Aguilar (formerly Managing Director of Google in Portugal and Director of various divisions in Spain and Canada) to create an integrated technology and marketing group aiming at organic and inorganic growth.
The first integration of companies into the Making Science Group came about in July 2016 with the alliance and merger of two companies, (i) The Science of Digital, S.L., established on 5 May 2016 by José Antonio Martínez Aguilar for digital advertising and Google technology-based data analytics, and (ii) Make Marketing y Comunicación, S.L. (currently Making Science Group, S.A., the Group's parent company), established on 8 January 2001 by Gonzalo Verdeja Lizama and headed by Álvaro Verdeja Junco, for digital marketing specialising in SEO (Internet search engine positioning) and social media.
To develop that vision, in 2017 and 2018 the Group operationally merged with five companies with complementary staff and know-how, sharing offices, though corporate acquisitions ended between 2018 and 2019. In addition, in 2020 the Group purchased CloudForms, S.L.'s Salesforce business and Omniaweb Italia, S.R.L. The main features of the mergers of these companies are summarised below:
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Operational | Corporate | Links to current | Complementary area | |
Company | workforce | major | ||
merger | of specialisation | |||
integration | shareholders | |||
Group's parent | - Digital advertising on | |||
Making Science | - | Álvaro Verdeja | search engines and | |
company | ||||
social media | ||||
Group, S.A. | ||||
Merger with the | José Antonio | - Digital advertising | ||
The Science of | March 2017 | parent company, | and data analytics | |
Martínez | ||||
September 2019 | - Google technology | |||
Digital, S.L. | ||||
Ingeniería para | Takeover by the | - Software | ||
March 2017 | parent company, | - | development and data | |
la Innovación | ||||
December 2018 | analytics | |||
I2TIC, S.L. | ||||
Takeover by the | ||||
Crepes & Texas, | March 2017 | parent company, | - | - Creativity and design |
December 2018 | ||||
S.L. | ||||
Takeover by the | José Antonio | - Engineering and Big | ||
Martínez | Data services | |||
March 2018 | parent company, | |||
MCentric, Ltd. | (minority | - Presence in Africa | ||
October 2019 | ||||
shareholder) | and Asia | |||
Making Science | Takeover by the | José Antonio | - Marketing arm of | |
Digital | March 2017 | parent company, | The Science of Digital | |
Martínez | ||||
Marketing, S.L. | December 2018 | in Spain | ||
Probability | Takeover by the | José Antonio | - Marketing arm of | |
Domain | March 2017 | parent company, | The Science of Digital | |
Martínez | ||||
Unipessoal, Lda. | October 2019 | in Portugal | ||
Purchase of | ||||
assets by | ||||
CloudForms, S.L. | July 2020 | Ingeniería para | - | - Implementation of |
(purchase of the | la Innovación | Salesforce technology. | ||
Salesforce | I2TIC, S.L., July | |||
business assets) | 2020 | |||
Takeover by | - Digital advertising, | |||
development and e- | ||||
October 2020 | MCentric, Ltd., | - | ||
Omniaweb Italia, | commerce | |||
October 2020 | ||||
- Presence in Italy | ||||
S.R.L. | ||||
Through these mergers and acquisitions, Making Science has consolidated itself as a marketing and technology consultancy group and positioned itself as a high value-added,one-stop provider of both digital marketing and data analytics.
1.4.3. Vision and new alliances
The Group's vision in the coming years is to further develop its value propositions and become a bellwether for digital marketing and data analytics internationally primarily to expand into areas in the United States and Latin America while continuing its growth in Europe.
In keeping with this vision, the Making Science Group continues to explore new alliances with companies that may offer complementary lines of business, personnel, know-how, or geographic location.
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Between October 2018 and February 2019, Making Science concluded two strategic alliance agreements with the companies Karma Network (in Lisbon, Portugal) and IKI Media (in Barcelona) to enable it to continue to enhance its client services and its by entry into Lisbon and Barcelona.
Strategic alliance with IKI Media
In October 2018 Making Science entered into an alliance with IKI Media, a Barcelona-based media and communications agency. The alliance will make possible:
- Growth in Barcelona with employees based at IKI Media's office (previously the company operated in Barcelona using personnel located offshore, with clients like Uriach, Carglass, and Naturitas).
- Enhanced client services through a combination of Making Science and IKI Media technologies for developing online attribution models (Making Science's speciality with its own Gauss AI technology) and offline attribution models (IKI Media's specialty with its own DARI {Data, Analytics, Research, Intelligence} approach, combining databases to obtaining a holistic overview of what is taking place in an advertising campaign, ascertaining the relationships among the different aspects of a campaign, and determining which elements have helped accomplish the planned objectives).
Alliance with Karma Network
In February 2019 Making Science entered into an alliance with Karma Network, a digital marketing agency located in Lisbon. The alliance will make possible:
- Growth in Portugal with employees based at Karma Network's office (previously the company operated in Portugal using personnel located offshore, with clients like Pestana Hotels, BCP Millennium, TAP Air Portugal, and EDP Energias de Portugal).
- Enhanced client services through a combination of the two companies' services and Karma Network's positioning, with its more than 10 years' involvement in supporting its clients in digital transformation in the field of marketing.
1.4.4. Other relevant milestones
Making Science has a history of marked growth since the very inception of The Science of Digital, S.L. and formation of the Group, robust client acquisition being chief among its milestones.
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2016
- Gains such leading clients as Openbank, Altamira, L'Oréal, RIU Hotels,
UNIR, etc.
- Google Analytics 360 partner
2017
- Gains such major clients as Mapfre, BBVA, eDreams, Pibank, Neinor, Sareb, Decathlon, Mapfre Savia, etc.
- DoubleClick Marketing (currently Google Marketing Platform) partner in EMEA.
- Start of business activity in Portugal, opening a new office in Lisbon.
- The Group grows to over 100 employees.
2018
- Gains such leading clients as Inditex, Securitas, Pescanova, PSA
Peugeot Citroën, Liberbank, Mazda, Century 21, Venca, etc.
- DoubleClick Marketing (currently Google Marketing Platform) and Google Analytics 360 reseller.
- Development of its own Gauss AI platform to optimise clients' investments in Digital Marketing.
- The Group grows to over 180 employees.
2019
- Gains such important clients as Carrefour, IFEMA, Bimba y Lola, Pull&Bear, Naturitas, Sanitas, Realme, Boston Medical Group, Iberdrola, etc.
- Development of the Nilo platform, a Google Cloud-based SaaS platform to optimise e-commerce strategies.
- Development of the Shoptize platform, a comparison shopping service that generates online sales for e-commerce clients and optimises marketplace investments.
- A facility agreement for 2.5 million euros was signed with Banco Santander's Fondo Smart on 10 May 2019. The facility has a grace period lasting until 10 December 2020 followed by 20 quarterly instalments after the grace period until maturity on 10 December 2025.
- In July 2019 Making Science wins the 2019 Madrid Pyme del Año (SME of the year) award issued by the Madrid Chamber of Commerce and Banco Santander.
2020
- Gains such leading clients as Santander, Planeta, etc.
- Development of new proprietary products in house: DataQuality and Unifeedr.
- The workforce grows to 268 employees with more than 40 hirings in 2020.
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- The keeps obtaining new certifications from the main technology supppliers within the industry (Salesforce, Facebook, Google).
- Participation at the 2020 Medcap Forum, an essential event for European investors and listed Spanish medium and small-cap enterprises organised by the Spanish Stock Exchange operator Bolsas y Mercados Españoles, held on 26 to 28 May.
- Offices opened in Milan and Valencia.
- Acquisition of the assets connected with CloudForms, S.L.'s Salesforce business by I2TIC, S.L. in July 2020.
- Acquisition of Omniaweb Italia, S.R.L. by MCentric, Ltd. in October 2020.
1.4.5. Milestones to be achieved during the next months
In the coming months Making Science will be focusing on international expansion and continued investment in proprietary technologies.
In terms of international expansion, in October and November 2019 Making Science Group opened offices and operations in France and Mexico and hired Carlo Baratti (a former Google executive) as Director of International Development. On the date of issue of this Information Document, the Group has already begun providing consultancy services to MAPFRE Mexico for paid digital advertising campaigns. Going forward, the Company plans to start doing business in Italy, the United Kingdom, and the United States, where it has opened offices and hired Commercial Directors in country.
Turning to its investments in technology, the Company plans to continue developing its proprietary Gauss AI, Nilo, Shoptize, DataQuality, and Unifeedr technology platforms to promote further implementation by both existing and future clients.
Looking at new executive recruiting, Clara Ballesteros Vigil de Quiñones has joined the Group from Dentsu Aegis as Director of People and Culture, Gonzalo Valdés Martínez Vara del Rey has come on board as Director of Strategy, and Jorge Alonso Gutiérrez has been hired as Director of Automation and Dublin Operations.
1.4.6. Milestones related to acquisitions
The corporate acquisitions that have given rise to the Making Science Group are listed below.
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Description of the Group's parent company and ownership structure
On 18 November 2016 the members of Make Marketing y Comunicación, S.L. and the members of The Science of Digital, S.L. signed an agreement affording The Science of Digital, S.L. the option to purchase up to 100% of Making Science Group, S.A. in different phases.
The Science of Digital, S.L. acquired 100% of Make Marketing y Comunicación, S.L. for that company to serve as the parent company of the Making Science Group and for corporate acquisitions (Ingeniería para la Innovación I2TIC, S.L., Crepes & Texas, S.L., Making Science Digital Marketing, S.L., Probability Domain Unipessoal, Lda., and MCentric, Ltd.) to be implemented through Make Marketing y Comunicación, S.L. The acquisition was also intended to add the business of The Science of Digital, S.L. (by transferring the The Science of Digital, S.L. business to a newly created holding company that would subsequently be merged into Make Marketing y Comunicación, S.L.).
Acquisition of 100% of Make Marketing y Comunicación, S.L. by The Science of Digital, S.L. took place in four phases:
- On 22 December 2016 The Science of Digital, S.L. acquired four private limited liability shares (1% of the share capital) of Make Marketing y Comunicación, S.L. from its members for 33,490 euros pursuant to the public deed executed by Madrid Notary Mr. Rafael de la Fuente García, on record in his protocol under number 3869.
- On 24 November 2017 The Science of Digital, S.L. acquired 80 private limited liability shares (20.00% of the share capital) of Make Marketing y Comunicación, S.L. from its members for 621,998 euros pursuant to the public deed executed by Madrid Notary Mr. Antonio Luis Reina Gutiérrez, on record in his protocol under number 9566.
- On 19 January 2018 The Science of Digital, S.L. acquired 71 private limited liability shares (17.75% of the share capital) of Make Marketing y Comunicación, S.L. from its members for 598,383 euros pursuant to the public deed executed by Madrid Notary Mr. Antonio Luis Reina Gutiérrez, on record in his protocol under number 459.
- On 23 November 2018 The Science of Digital, S.L. acquired the remaining 245 private limited liability shares (the remaining 61.25% of the share capital) of Make Marketing y Comunicación, S.L. from its members for 1,650,675 euros, making it the single member, pursuant to the public deed executed by Madrid Notary Mr. Antonio Luis Reina Gutiérrez, on record in his protocol under number 10087.
Acquisition and merger of companies linked to José Antonio Martínez Aguilar
Acquisition of Making Science Digital Marketing, S.L. by Making Science Group, S.A. in December 2018
On 21 December 2018 Making Science Group, S.A. (then named Make Marketing y Comunicación, S.L.) acquired the entire share capital (3,000 shares) of Making Science Digital Marketing, S.L. (then named Artificial Intelligence Algorithmics, S.L.) from its members, José Antonio Martínez Aguilar (CEO of the
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Company) and Raquel Romero Muñoz pursuant to the public deed executed by Madrid Notary Mr. Rafael de la Fuente García, on record in his protocol under number 3918.
Making Science and The Science of Digital, S.L. (through the holding company Propuesta Digital, S.L.U.) merged to bring the Making Science Group's business into the Group in September 2019
Propuesta Digital, S.L.U., Tax Identification Number B88444666, was incorporated on 17 July 2019 with the contributed assets of The Science of Digital, S.L. for the express purpose of transferring one of that company's lines of business and subsequently merging the company into Making Science pursuant to the public deed executed by Madrid Notary Mr. Rafael de la Fuente García on that same date, on record in his protocol under number 2500, registered at the Commercial Registry of Madrid in Volume 39417, Page 49, Section 8, Sheet M-699846, Entry 1 on 31 July 2019. Propuesta Digital, S.L.U. was incorporated with a share capital of 652,320 euros, comprising 652,320 private limited liability shares having a par value of one euro (€1.00) each. The private limited liability shares were subscribed and fully paid in by The Science of Digital, S.L. as the single member, which contributed the assets, liabilities, and employees of the media and technology management, digital marketing, and analytics line of business and functioning business unit. The non-cash assets contributed included 4,000,000 shares of Making Science Group, S.A. (then named Making Science Group, S.L.). The aforesaid business line was contributed at its net balance sheet value of 652,320 euros. The breakdown of net assets and liabilities contributed is set out below:
Net assets and liabilities contributed to Propuesta | ||
Digital, S.L.U. by The Science of Digital, S.L. | 2019/06/30 | |
(thousands of euros) | ||
Contributed assets | 10,107 | |
Fixed assets | 11 | |
Long-term investments in group and associated | 2,932 | |
companies | ||
Non-current financial assets | 9 | |
Inventory | 25 | |
Trade and other receivables | 6,773 | |
Short-term financial assets | 245 | |
Cash and cash equivalents | 112 | |
Contributed liabilities | -9,455 | |
Short-term accruals | -240 | |
Trade and other payables | -5,325 | |
Short-term debts | -3,890 | |
Total | 652 |
On 27 September 2019, Making Science Group, S.L.U. and Propuesta Digital, S.L.U merged, with the former company absorbing the latter company, pursuant to the public deed executed on that date by the Madrid Notary Mr. Rafael de la Fuente García, on record in his protocol under number 3428, registered at the Commercial Registry of Madrid in Volume 16082, Page 194, Section 8, Sheet M-272332, Entry 15 on 15 October 2019. Previously, on 1 August 2019, Making Science Group, S.L.U. (the Absorbing Company)
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and Propuesta Digital, S.L.U. (the Absorbed Company holding the business and assets of The Science of Digital and all of the private limited liability shares of Making Science Group, S.L.U. on that date) had, by decision of their respective single members (Mr. José Antonio Martínez Aguilar in both cases), approved the reverse takeover of the Absorbed Company pursuant to the joint reverse merger plan signed by the sole directors of both companies on that date (1 August 2019). The merger entailed the transfer of the assets and liabilities of Propuesta Digital, S.L.U. to Making Science Group, S.L.U. with universal succession of all the rights and obligations of Propuesta Digital, S.L.U. and dissolution (without liquidation) and extinguishment of that company. As a result of the merger, the private limited liability shares of Propuesta Digital, S.L.U., all held by The Science of Digital, S.L., were repurchased, with all the private limited liability shares of Making Science Group, S.L. passing into the ownership of The Science of Digital, S.L. For accounting purposes all transactions carried out by Propuesta Digital, S.L.U. from 31 July 2019, the date of its integration into Making Science Group, S.L.U., are to be understood to have been performed by Making Science Group, S.L.U.
Acquisition of Probability Domain Unipessoal, Lda. by Making Science Group, S.A. in October 2019
By a private purchase agreement, on 29 October 2019 Making Science Group, S.A. acquired all the share capital (par value 3,000 euros) held by José Antonio Martínez Aguilar. By way of further explanation of the investments carried out.
Acquisition of MCentric, Ltd. by Making Science Group, S.A. in October 2019
On 28 October 2019, by public deed executed by Madrid Notary Mr. Rafael de la Fuente García, on record in his protocol under number 3859, Making Science Group, S.A. acquired 168,724,775 private limited liability shares of MCentric, Ltd. (of the 197,078,628 private limited liability shares making up its share capital) from Bastiat Internet Ventures, S.L., in a swap for 341,997 shares of Making Science Group, S.A., newly issued in the share capital increase carried out on that same date.
Over the course of 2019, Making Science Group, S.A. acquired all the remaining private limited liability shares of MCentric, Ltd. from various members by private purchase agreements. By way of further explanation of the investments carried out.
Acquisition of companies linked to other members.
Acquisition of Ingeniería para la Innovación I2TIC, S.L. by Making Science Group, S.A. in December 2018
On 21 December 2018 Making Science Group, S.A. (then named Make Marketing y Comunicación, S.L.) acquired the entire share capital (400 shares) of Ingeniería para la Innovación I2TIC, S.L. from its members pursuant to the public deed executed by Madrid Notary Mr. Rafael de la Fuente García, on record in his protocol under number 3891. By way of further explanation of the investments carried out.
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Acquisition of Crepes & Texas, S.L. by Making Science Group, S.A. in December 2018
On 24 December 2018 Making Science Group, S.A. (then named Make Marketing y Comunicación, S.L.) acquired the entire share capital (3330 shares) of Crepes & Texas, S.L. from its members pursuant to the public deed executed by Madrid Notary Mr. José María Recio del Campo, on record in his protocol under number 3062. By way of further explanation of the investments carried out.
Transfer of shares to the former members of Make, Crepes & Texas and I2TIC by the principal shareholder, The Science of Digital, S.L., in October 2019.
To fulfil its obligations after the operations to purchase Make Marketing y Comunicación, S.L., Crepes & Texas, S.L., and Ingeniería para la Innovación I2TIC, S.L., on 28 October 2019 the principal shareholder, The Science of Digital, S.L., transferred a total of 511,874 shares to seven members of those companies (currently executives of the Company). It should be noted that Álvaro Unripe Junco (a former member of Make Marketing y Comunicación, S.L.) acquired 387,483 shares. By way of further explanation of the share transfers.
Acquisition of the assets connected with CloudForms, S.L.'s Salesforce business by I2TIC, S.L. in July 2020
On 14 July 2020 Making Science reported the signing of an agreement to purchase the assets of CloudForms, S.L. connected with the Salesforce business, extending to its human resources, trade name, certifications, clients, and goodwill. CloudForms includes a team of consultants with over 30 years' experience in implementing Salesforce technology.
Through this acquisition Making Science Group, S.A. estimates growth in gross profits of 500,000 euros and an increase in the EBITDA of 100,000 euros in the next 12 months. The purchase price of the assets has been set at less than two times the expected EBITDA for the next 12 months.
By this operation the Company expects to boost its line of business of providing support for implementing Salesforce and its activities and continuing to expand its capabilities in a field in which demand by companies is constantly growing. This acquisition enables Making Science to continue to enhance its portfolio of technical services with an ever more integrated vision of the data-driven operational and business cycle, fostering result-baseddecision-making with high traceability. In the final analysis, this will make it possible to respond to companies' needs as demanded by the market, achieving both a high impact on user satisfaction and operational efficiency.
Acquisition of Omniaweb Italia, S.R.L. by MCentric, Ltd. in October 2020
On 15 October 2020, Making Science reported the signing of an agreement to purchase 100% of Omniaweb Italia, S.R.L.'s shares. With this acquisition, Making Science integrates a team of 25 consultants and a strong presence in the Italian market, especially in the e-commerce category.
Through this acquisition, Making Science Group, S.A. estimates an increase of 1.1 million euros in EBITDA. The purchase price of this transaction is 7.1 million euros.
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Since 2019, Making Science has been present in the Italian market, with clients like Bulgari, Easycoop and Luisaviaroma. With Omniaweb's integration, Making Science will expand its client portfolio with AllTours, Eurospin, Bidon, Ventis and Frette.
The union of these two companies will allow to combine Omniaweb's expertise in the local market and Making Science's cutting edge technological capabilities allowing to offer a service of premium quality.
1.4.7. Milestones related to the listing to BME Growth
On 28 October 2019 the Company (then named Making Science Group, S.L.) decided to become a public limited liability company and to change its corporate name to Making Science Group, S.A. with each member receiving one share for each private limited liability share pursuant to the public deed executed by Madrid Notary Mr. Rafael de la Fuente García on 8 November 2019, on record in his protocol under number 4033, registered at the Commercial Registry of Madrid in Volume 39598, Page 179, Section 8, Sheet M- 272332, Entry 18 on 3 December 2019.
On 15 November 2019, the Company's Extraordinary General Shareholders Meeting held with all shareholders present or represented resolved to request listing of all currently issued shares and all the shares issued between the date of that decision by the General Meeting and the effective date on which the Company's shares are listed on BME Growth, thereby including any shares that may be issued by the Board of Directors by virtue of the powers vested in it as mentioned above. That General Meeting resolved to authorise delegate authority to request listing of all shares on BME Growth on behalf of the Company to the Board of Directors.
On 31 January 2020 Making Science concluded its public offering on gaining admission to BME Growth and increased its share capital by 3,603.03 euros by issuing 360,303 new shares numbered from 6,701,998 to 7,062,300, having a par value of 0.01 euros each, to allow new investors entry. The share capital increase entailed a total share issue premium of 1,149,366.57 euros (3.19 euros per share) by cash contribution, with the entry of 342 new shareholders.
The Company achieved admission of all its shares to BME Growth on 21 February 2020.
1.5. Reasons why it has been decided to request incorporation into Euronext Growth.
The main reasons Making Science requested listing on Euronext Growth are:
- To increase the Company's shareholders equity and drive the current phase of national consolidation and international expansion.
- To establish a funding mechanism that will enable the Company to increase its ability to obtain the resources to finance future growth over and above the share capital increase mentioned in this Information Document.
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- To aid growth through the acquisition of other companies.
- To expand the shareholder base and provide a liquidity mechanism and a mechanism for objectively valuing shares.
- To have listed shares for use in ensuring employee loyalty.
- To boost the level of knowledge, brand image, transparency, and good standing with third parties (clients, vendors, credit institutions, etc.).
1.6. General description of the issuer's business, referencing the activities it carries out, the characteristics of its products or services and its position in the markets in which it operates.
1.6.1. Lines of Activity
Making Science combines digital advertising services with data analytics and software development, lines that are highly complementary.
1) Digital advertising
Making Science differentiates four types of digital advertising services: paid advertising consultancy, organic advertising consultancy, creativity and content, and media and ad tech technology marketing.
1.1. Paid advertising consultancy
Making Science offers consultancy services for paid digital advertising campaigns by its clients to maximise conversion of advertising expenditures into sales. The consultancy services cover all areas of digital advertising (searches, social media, display, video, and classifieds).
As of 1 September 2020 the paid advertising consultancy team consists of 65 consultants split between paid advertising and media and ad tech technology marketing.
The EBITDA margin of this line of business is estimated at around 20% of net revenues.
Turnover from this line of business is spread among more than 50 clients with a low concentration of revenues. The Company's main clients include: Mapfre, Openbank, Santander, eBay StubHub, Riu Hotels, Zara, Pull&Bear, Nueva Pescanova, Verti, L'Oreal, Altamira, Iberdrola, and others.
1.2 Organic advertising consultancy
Making Science offers consultancy services for organic digital positioning campaigns (digital advertising without payments to the platform) by its clients on search engines (mainly Google) and social media (mainly Facebook) to maximise the client's digital impact, web traffic, and sales.
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As of 1 September 2020 the organic advertising consultancy team consists of 30 consultants who work closely with the in-house web development and creative services teams to alter web designs and content to maximise organic website traffic from the main digital search engines.
The EBITDA margin of this line of business is estimated at around 20% of net revenues.
Turnover from this line of business is spread among more than 20 clients with a low concentration of revenues. The Company's main clients include: Openbank, eBay, StubHub, Zara, Pull&Bear, Nueva Pescanova, Verti, L'Oreal, Decathlon, Iberdrola, etc.
1.3 Creativity and content
Making Science offers creative and content creation services consultancy, e.g., brand image design, user experience and website interface, and content strategy for its clients' digital assets (such as their websites or their e-commerce platforms) to maximise their digital impact, web traffic, and sales.
As of 1 September 2020 the creativity and content team consists of 31 designers, creatives, and content experts.
The EBITDA margin of this line of business is estimated at around 20% of net revenues.
Turnover from this line of business is spread among more than 40 clients with a low concentration of revenues. The Company's main clients include: Mapfre, Openbank, Pull&Bear, Nueva Pescanova, Verti, Carrefour, Coca-Cola, IFEMA, Verisure, etc.
1.4 Media and ad tech technology marketing
Making Science offers media and technology agency services brokering purchases of digital advertising space and technology for subsequent resale to its clients. The media involved are from different vendors, such as Google, Facebook, Microsoft, Amazon, Unidad Editorial, and PRISA. The technology is basically that of the Google Marketing Platform including the Google Analytics 360 product, along with such other technology platforms as Salesforce, HubSpot, etc. Ad tech platform marketing is not mutually exclusive among the different vendors. At present most revenues are earned from marketing Google's technology platform.
Net revenues from turnover from media and ad tech technology marketing do not include the entire digital media budget managed by Making Science for its clients, which exceeded 100 million euros in 2019, from which the Company generates paid advertising consultancy revenues.
Vendors are paid for the technology and media purchased under a pay-per-use model, so no stock is generated and there is no risk of obsolescence. The media and ad tech technology marketing team works in combination with paid advertising.
The EBITDA margin of this line of business is not significant in relation to net revenues.
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Turnover from this line of business is spread among more than 20 clients with a low concentration of revenues. The Company's main clients include: Openbank, Santander, eBay, StubHub, Zara, Pull&Bear, Nueva Pescanova, Verti, Altamira, Carrefour, Decathlon, Iberdrola, Verisure, etc.
2) Data analytics and development
Making Science differentiates four types of data analytics and development services: advertising data analytics, web and cloud development, in-house technology, and Big Data development.
2.1. Advertising data analytics
Making Science's advertising data analytics business comprises technology implementation services (including the ad tech technology marketing line of business, particularly Analytics 360) and advertising data metrics consultancy (performance of digital advertising campaigns), data analysis, and recommendations for optimising digital advertising campaigns.
As of 1 September 2020 the advertising data analytics team consists of 25 consultants, data scientists, and programmers.
The EBITDA margin of this line of business is estimated at around 20% of net revenues.
Turnover from this line of business is spread among more than 20 clients. The Company's main clients include: RIU Hotels, Pullmantur, IFEMA, Mapfre, Verisure, etc.
2.2. Web and cloud development
Making Science's web and cloud development services span website, e-commerce, enterprise resource planning system (ERP system), customer relationship management system (CRM system), and cloud system development and design. The Company focuses on integrating clients' systems with the Company's own internal systems to activate the relevant digital marketing uses of those systems.
As of 1 September 2020, the web and cloud development services team consists of 45 engineers, programmers, and developers who are split between web and cloud development services and proprietary technology.
The EBITDA margin of this line of business is estimated at around 20% of net revenues.
Turnover from this line of business is spread among more than 20
clients. The Company's main clients include: Mapfre, BBVA, TradeInn, Ocaso, Sanitas, KaveHome, 3ina, Dideco, etc.
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2.3. Proprietary in-house technology
Besides marketing third-party technology licences (see above), Making Science sells annual licences to the Company's own proprietary technology developed in house under the Software as a Service (SaaS) model.
The Company has already developed five different technologies:
- Gauss AI: Machine Learning framework that includes pre-designed predictive models. These predictive models optimise the investment in digital marketing and user experience by activating the predictions on the various platforms, such as Google Marketing Platform, Facebook Ads, or Google Ads. Gauss AI is a technology funded by Spain's CDTI developed by The Science of Digital, SL, with the Making Science Group holding exclusive marketing rights to the platform and an option for the Making Science Group, S.A. to purchase the technology from The Science of Digital, S.L. at its book value. Making Science has already put the marketing process in motion.
- Nilo: an integral e-commerce platform that enables companies to launch their e-commerce initiatives. It contains the functionalities needed to be able to launch an e-commerce web, including a product catalogue, a payment gateway, a logistics module, a user module, etc. The platform is currently running at KaveHome, Sanitas, and Mapfre Salud Digital (Savia).
- Shoptize: a comparison shopping platform that enables end users to compare prices for more than two million products. Furthermore, it is a Google-certified CSS (Comparison Shopping Site) suitable for running campaigns on Shopping Ads.
- DataQuality: software designed to validate KPIs (key performance indicators) reported by different marketing platforms using data ingestion, continuous data processing and display, and intercomparison of the reported data as well as comparison with a reference pixel.
- Unifeedr: middleware with a persistent database that links the client's product feed to the Marketplace (Google Merchant Center). This tool maintains product feed and Merchant Center integrity, offering the team of consultants and the client full IT independence. Technicians can issue push notifications of changes in real time and update product details from Unifeedr to Merchant Center.
The in-house team is split mainly with the web and cloud development department, although the teams working on other lines of business are also involved in developing proprietary technology.
The EBITDA margin of this line of business is estimated at near 100% of net revenues.
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Turnover from this line of business is spread among more than 5 clients. The Company's main clients include: TradeInn, RIU Hotels, Pestana Hotels, KaveHome, etc.
2.4. Big Data services
Making Science's Big Data business comprises model and systems development services for analysing high volumes of data used in digital marketing and other corporate areas.
As of 1 September 2020, the Big Data services team consists of 22 engineers, programmers, and developers.
The EBITDA margin of this line of business is estimated at around 20% of net revenues.
Turnover from this line of business is spread among more than 10 clients. The Company's main clients include: Globacom, Securitas, Valid, 9mobile, Etisalat, Vodafone,
Verisure, etc.
1.6.2. Success stories:
Making Science has had many successes with well-known clients, for instance::
L'Oréal
- Main line of business: organic advertising consultancy.
- Objective: to lead the entire semantic market in the beauty industry by coordinating brands to avoid cannibalisation (especially in organic search engine positioning) and structuring the divisions' digital ecosystem.
- Approach: by fostering awareness of the importance of organic search engine positioning (SEO) by training all the departments concerned and designing methodologies to be included in the SEO implementation development process.
- Results: a 29‑% increase in organic traffic to Lancôme (one of L'Oréal's perfume and cosmetics brands) with a 32‑% increase in the conversion rate.
Decathlon
- Main line of business: organic advertising consultancy.
- Objective: to increase sales by improving organic positioning and to become a bellwether in the retail sporting goods industry.
- Approach: by focusing on technical implementations and content to enhance indexing (showing up in digital search results) and avoid duplicate content and consultancy by marketing managers to control the semantic market for each vertical (especially organic search engine positioning).
- Results: a 27‑% increase in conversions and a 26‑% increase in organic traffic.
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Verti Germany
- Main line of business: proprietary technology
- Objective: to increase sales by optimising expenditures on prospecting (initial communication with prospective customers) and remarketing (communication with existing customers or users who have already visited the website earlier).
- Approach: by drawing up a smart audience strategy using artificial intelligence-based predictive models on the Gauss AI platform (proprietary technology). Gauss AI is designed to predict the purchase probability of each website visitor based on data compiled from Google Analytics 360 and automatically generate audiences and segments among these users. These audiences were used to sideline users with the lowest scores in remarketing campaigns and to do the opposite with look-alike users in prospecting campaigns. A campaign using graphic and video advertisements based on smart audiences with a high purchase probability was then designed and the results were analysed for model fitting.
- Results: within two months of the start of the initiative, sales increased by 20%, DV360 (Display & Video 360, a Google campaign tool for managing planning, creatives, segmentation, measurement, and optimisation) prospecting and remarketing campaign expenditures dropped by 45%, transaction volume rose by 16%, and the CPA (Cost Per Acquisition) in remarketing campaigns decreased by 55%.
This success was published by Think with Google (a Google blog that compiles data and cases for studying its digital marketing tools).
Other creativity and UX and UI (user experience and experience interface) successes
Making Science has garnered numerous successes in the areas of creativity and UX and UI for a range of brands, including Viaja Wäy, Sha Wellness Clinic, Uber, Totem, Microsoft, Bartalent Lab, Sofia Square, Pompeii, Black Limba, 4711, Mutua Madrid Open, República Móvil, MSD, Coca-Cola, Rustical Travel, Kanikas, Borgia Conti, Banco Santander, Biosearch Life, Mosquito, BBVA, and Socketines.
1.6.3. Acknowledgments and awards
Making Science has received many acknowledgments and awards, for instance:
- It was voted SME of the Year by the Madrid Chamber of Commerce and Industry in June 2019 and will represent the Madrid Region in the Spanish SME of the Year competition in February 2020. This award recognises the Company for innovation, job creation, and internationalisation.
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- Great Place to Work ranked the Company as one of the best places to work in Spain in 2019.
It won the award for Best SEO/SEM Agency at eAwards Madrid 2019.
- Based on a survey of 432 executives employed by Spain's leading companies, the Company earned recognition by Agency Scope 2018/19 as the agency rated highest by its clients in 9 of 35 categories ( SEO Services, Advanced Digital, Data Capability, Analytics Metrics Services/ROI, Adds Value for Clients, Innovative Agency (Digital and/or Business Transformation), Good Team of Professionals, Effective Incident Resolution, and Mobile/App Solutions).
1.6.4. Relationship with clients
The Company takes on the role of strategic partner and Marketing Director for its clients which stands out as a provider of integral services that works side by side with its clients in each phase of customer acquisition (awareness, consideration, conversion, and loyalty). Making Science therefore offers customised services in organic advertising and paid advertising appropriate to each phase along with transversal services in each phase, e.g., developing digital assets and content (to boost customer interaction, maximise web traffic, and achieve conversion into sales) and data analytics (to tailor offers to customers, enhance interaction, and maximise conversion into sales).
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1.6.5. Customer acquisition process
Making Science relies on an effective customer acquisition process based on a series of pillars.
How does Making Science acquire new customers?
Making Science acquires new customers through its proposals and by taking part in bidding, putting forward a large number of proposals every month with the aim of converting those proposals into new projects.
Receipt of requests for proposal and proposal preparation
Making Science relies on a series of elements to maximise the requests for proposal received, for instance:
- Referers and recommendations: as the Group's portfolio of clients grows, the number of referers and requests for proposal received from prospective new customers grows along with it.
- Events: the Group takes part in some four events monthly, organised either on its own or with partners, to foster contacts with prospective customers.
- Acknowledgments and awards: the Group has received numerous acknowledgments and awards, such as the SME of the Year award by the Madrid Chamber of Commerce and Industry in 2019 and being named a Great Place to Work in Spain in 2019, the Best SEO/SEM Agency by eAwards Madrid 2019, and the Agency rated most highly by its clients by Agency Scope 2018/19.
Conversion of proposals into new projects
Making Science has a high rate of conversion of proposals into projects, higher than 30%. This is due to the Group's efforts and know-how regarding business processes and how to draw up proposals that stand
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out because of their competitive strengths, namely, having a digital marketing team with a local presence, positioning as a one-stop provider of digital marketing and data analytics, integration of teams of highly trained and highly skilled specialists in areas that complement each other (consultants, programmers, data analysts, creatives, engineers, etc.), technology skills, and standing as a leader in ad tech.
1.6.6. Infrastructure and technical facilities
The Company benefits from a high degree of integration among teams of diverse specialists (consultants, programmers, data analysts, creatives, engineers, etc.) who share the same space and interact on an ongoing basis at the same main office on López de Hoyos Street in Madrid.
The premises are large, with open spaces and a floor area of 2,200 square metres. The building is large enough to absorb personnel growth in the coming years.
1.6.7. Relevant Markets and expectations of growth
Introduction to digitisation
The massive reach of the Internet fuelled by technological advances is making it necessary for companies to digitise, to turn the use of technology into a competitive tool.
The Internet has changed into a broadly used instrument that is experiencing massive growth. Technological progress from the early webs in the 1990s (including Google in 1998) to the widespread use of smartphones in the 2000s and 2010s (reaching half the population of the entire world in 2017) has expanded the Internet from barely 16 million to 4.5 billion users.
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Growth in the number of Internet users
No. of Internet users (millions) | 4.536 |
% Internet users / world population
3.150
1.991 | 59% | ||||
1.024 | 43% | ||||
16 | 361 | 16% | 29% | ||
6% | |||||
0,4% | |||||
2000 | 2005 | 2010 | 2015 | June 2019 | |
1995 |
Source: Internet World Stats
This escalation in penetration by use of the Internet is causing a whole gamut of sectors (i.e., retail, banking, education, insurance) to have to undergo a digital transformation to adapt to the growing demand by users for goods and services over digital media.
Examples of digital transformation in different industries
Source: Forrester, eMarketer, Avaka, Statista, iSalud
Consequently, there is a growing need for businesses to digitise their entire value chain, particularly marketing, where there is a need for digital advertising services (to attract customer attention), data analytics (to optimise online acquisition), and the development of digital assets (e.g., support for interaction with customers, i.e., e-commerce platform, web, etc.).
Digitisation of the value chain
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Markets where Making Science does business: four growing markets
Making Science stands in the centre of four markets (digital advertising, data analytics, e-commerce, and the cloud) that are experiencing double-digit growth, with growth rates of around 15% per year.
1) Digital advertising
The new digital sphere requires a new form of customer relationships and forces businesses to expend increasing amounts on advertising on digital media in order to attract the attention of customers. As a result, advertising on digital media is likely to surpass advertising on conventional media starting in 2021, increasing from a projected share of 43.5% in 2018 to 52.1% in 2021 and 53.9% in 2022 worldwide.
The global digital advertising market had revenues of some 311 billion dollars in 2019, an amount expected to rise to 465 billion dollars in 2022.
Growth of the digital advertising market
Source: eMarketer, Forrester
Digital advertising market segments
The digital advertising market spans five segments (searches, social media, display, video, and classifieds).
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- Search engines (i.e., advertising on Google): an estimated market of 104 billion dollars in worldwide revenues in 2019 (33% of the global digital advertising market), expected to reach 127 billion dollars in 2022, with a compound annual growth rate ("CAGR") of 7% between 2019 and 2022.
- Social media (i.e., advertising on platforms like Facebook, Instagram, or Twitter): an estimated market of 93 billion dollars in worldwide revenues in 2019 (30% of the global digital advertising market), expected to reach 185 billion dollars in 2022, with a CAGR of 26% between 2019 and 2022.
-
Display (i.e., advertising as banners on destination web pages): an estimated market of 60 billion dollars
in worldwide revenues in 2019 (19% of the global digital advertising market), expected to reach 77 billion dollars in 2022, with a CAGR of 9% between 2019 and 2022. - Video (i.e., advertising in videos on platforms like YouTube): an estimated market of 33 billion dollars in worldwide revenues in 2019 (11% of the global digital advertising market), expected to reach 48 billion dollars in 2022, with a CAGR of 13% between 2019 and 2022.
- Classifieds (i.e., advertising on classified ad platforms like Milanuncios, Vibbo, Infojobs, Autocasión, and Fotocasa): an estimated market of 22 billion dollars in worldwide revenues in 2019 (7% of the global digital advertising market), expected to reach 27 billion dollars in 2022, with a CAGR of 7% between 2019 and 2022.
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Main vendors: importance of Google and Facebook
Searches and social media are the two main segments by size and growth, accounting for an estimated 63% of the market in 2019, dominated by a small number of operators, particularly Google for searches and Facebook for social media. This leadership in their respective segments enabled Google and Facebook to attain estimated market shares of 32% and 19%, respectively, of the global digital advertising market in 2019.
For businesses that advertise, this high concentration gives rise to a certain dependence on the services and technologies of those digital media vendors (in particular, in the case of Google, on Google Ads, Google Marketing Platform, and DoubleClick). As a result, this in turn represents an opportunity for companies that specialise in these technologies.
Increasing complexity of technology solutions
In addition, the digital advertising market is becoming more and more complex, both in the number of segments present and the range of businesses and technology solutions it contains. In this respect, the number of marketing technology software companies worldwide is estimated to be growing rapidly, from 150 in 2011 to around 7.000 in 2018 (source: Chiefmartech).
On the one hand, by enabling them to benefit as users of these new technology solutions, this dynamic is an
opportunity for businesses that invest in digital marketing. On the other hand, the growing number and complexity of those solutions presents clients with a difficulty when it comes to integrating them, which is in turn an opportunity for companies that specialise in digital marketing and technology consultancy and are able to make integration of these new technology solutions part of their value proposition to their clients.
Competitors in the digital advertising market
Section 1.6.8 of this Information Document lists the main competitors in this market.
2) Data analytics
There is growing demand for data analytics by businesses. In the current context of digitisation, businesses are able to access large quantities of data regarding their customers and their interactions with those
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customers. Confronted with this new opportunity, Big Data and data analytics have gained relevance by bringing competitive advantages.
In this connection, data analytics is already quite a large market with high potential for further growth. That market is put at 189 billion dollars worldwide in 2019 and is projected to reach 210 billion dollars in 2020, a growth rate of 11%.
Data analytics market
Source: Statista
Growing ability of businesses to collect data
More and more data is now becoming available to businesses. The growing sophistication of digital assets opens up access to more and more data. More and more data are being generated and are projected to expand by a factor of
10 worldwide in 2016-25, to 160 zettabytes (billions of gigabytes) (source: SeaGate).
Limited ability to analyse the data collected
At the same time, despite the large quantities of data that can be collected by digital assets, businesses have a limited ability to process and use them in decision-making.
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Growing importance of developing a data strategy to business
Faced with these trends, it is increasingly essential for businesses to develop a data analytics strategy, not only to maximise data collection but also to maximise the activation of those data to enhance decision- making and efficiency (automation by predictive models and machine learning) in all parts of the value chain, including marketing (e.g., optimisation of digital advertising expenditures or automation of marketing actions like personalised product recommendations to customers), and in that way become smart businesses that are highly competitive thanks to their use of data (like Netflix, Facebook, Spotify, or Amazon).
The path to smart businesses
This presents an opportunity to businesses that specialise in data analytics, can offer their clients digital advertising campaign optimisation services, automation of marketing actions, and development of digital assets to collect, process and activate data.
Characteristics of traditional, digital, and smart companies
Traditional companies | Digital companies | Smart companies | |||
Asset type | Fixed assets | Digital assets | Data | ||
Decision-making | Manual, based on intuition, | Process automation | Predictive models and machine | ||
supported by reports | learning | ||||
Strategy | Offline strategy | Digital strategy | Data strategy |
Competitors in the data analytics market
Divisadero, Metriplica, and BMind are some of Making Science's competitors in this area. The data analytics market is characterised by the need to have highly qualified professionals and by a learning curve that requires several years to achieve a level of advanced professional competence.
3) E-commerce
The e-commerce (electronic commerce or buying goods and services on the Internet) market is experiencing heavy growth and is becoming more and more important compared to offline commerce. Sales are put at 3.453 billion dollars in 2019 and are projected to reach 4.878 billion dollars in 2021, with a CAGR of 19% between 2019 and 2021.
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Growth of the e-commerce market
Source: Statista
Today all large companies are developing an e-commerce strategy that will enable them to adapt to their customers' needs.
According to data released by Spain's CNMC (the National Comission of Markets and Competition), e- commerce grew at an interannual rate of 22% in the first quarter of 2019, broken down by sector as follows:
E-commerce market competitors
Competing e-commerce companies are certified on different technology platforms. The main technology platforms are Magento (now owned by Adobe), Cloud Commerce (Salesforce), Prestashop, etc.
4) Cloud
A growing market given businesses' pressing need to store and analyse the data they generate. Worldwide revenues are put at 356 billion dollars in 2019 and are projected to increase by 15% in 2020, reaching 411 billion dollars. The cloud advertising segment stands out in particular and is projected to reach 151 billion dollars in 2021.
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Cloud market trend
Source: Gartner
Growth of the e-commerce and cloud markets affords an opportunity to businesses that specialise in digital advertising, are able to integrate e-commerce and cloud platform development into their value propositions to their clients, and can also offer support for data collection and analytics as well as for optimising digital advertising campaigns.
IDC projects a mean annual growth rate of 17% for the Cloud market in Spain in the coming years, climbing from the 1.514 billion euros attained in 2018 to over 2.790 billion euros in 2022.
Cloud market competitors
Google Cloud Platform, Amazon Web Services (AWS), and Microsoft Azure are the three main cloud platforms. Making Science works chiefly on the Google Cloud Platform and specialises in developing digital marketing services and applications, though we have also effected implementations on AWS and Azure at its clients' request. Quite a few companies offer Google cloud services.
1.6.8. Competitors:
Making Science's vision is to become one of the main operators on the international stage, resting on the foundation of its positioning as a high value-added,one-stop provider for clients thanks to its integrated teamwork and its specialised know-how (232 advertising and data analytics consultants, creatives, programmers, and engineers, all based at the same office), to its ability to offer technology solutions (including proprietary solutions), and its certification for such leading technology platforms as Google Marketing Platform, Search Ads, Facebook Ads, and Amazon Ads.
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Making Science has an aggressive plan for international expansion to be able to compete with the large independent digital marketing and ad tech operators (companies that in some cases, like Jellyfish, have over 1,000 employees) and build a global network.
There are different groups of competitors with different profiles in the sector:
- The Big 6 and their networks of affiliates: the main operators in the advertising sector by size are known as the Big 6, namely, WPP, Publicis, Omnicom, Interpublic Group (IPG), Dentsu, and Havas (all listed companies except Havas), though by the same token their holdings include hundreds of affiliates. These companies have net annual revenues on the order of 5 to 20 billion euros. In terms of their competitive strengths, these companies have a full range of digital marketing services (through their many affiliates) along with a certain national presence. Making Science has some strengths with respect to these competitors, namely, its technology and engineering skills (though these competitors may have affiliates that also have those skills), the degree of integration of its teams and affiliates (with effective communications and coordination that can assist in combining its services in an effective package in its value proposition to its clients), and the fact that we are digital natives (an association with and specialisation in digital marketing from the very inception of online advertising).
- Global Digital Operators: for example, Jellyfish (United Kingdom), S4 Share capital (United Kingdom, listed), and DQ&A (Holland). These competitors have net annual revenues on the order of 100 to 500 million euros (Making Science aspires to join the ranks of these operators). In terms of their competitive strengths, these companies have a broad range of digital marketing services (digital advertising, creativity, data analytics), stand out on account of their strategic relationship with the leading technical platforms, have a certain level of integration of their specialised workforce (which is not spread out at a large number of different affiliates or offices), and have a certain national presence. They have high technological capabilities that differentiate them from traditional advertising agencies.
- International operators positioned as one-stop providers: the leaders are M&C Saatchi, Artefact, The Mission, and Jaywing (all listed companies). These companies have net annual revenues on the order of 100 to 500 million euros. In terms of their competitive strengths, these companies have a broad
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range of digital marketing services (digital advertising, creativity, data analytics), have a certain level of integration of their specialised workforce (which is not spread out at a large number of different affiliates or offices), and have a certain national presence. Making Science has a strength with respect to these competitors, namely, its technology and engineering skills (though some of these operators may have a certain skill level).
- National operators positioned as one-stop providers: The Cocktail, Hastag Group, and T2O Media. These companies have net annual revenues on the order of 20 to 50 million euros. In terms of their competitive strengths, these companies have a broad range of digital marketing services (digital advertising, creativity, data analytics), have a high degree of integration of their specialised workforce (based at one or several offices), and are well positioned nationally. Making Science has a strength with respect to these competitors, namely, our technology and engineering skills (though some of these operators may have a certain skill level).
- National specialists: estimated at more than 50 companies, some of the main ones being Relevant Traffic, Neo Ogilvy (though it is an affiliate of Ogilvy, which in its turn is an affiliate of WPP), BMind, Labelium, DBI, and Nateevo, in different service areas. These companies have net annual revenues on the order of 5 to 20 million euros. In terms of their competitive strengths, these companies stand out on account of their high degree of specialisation and strong positioning nationally. Making Science has some strengths with respect to these competitors, namely, its broad range of digital marketing services (not restricted to just one specialised field) and its technology and engineering skills (though some of these operators may have a certain skill level).
- Generalist consultancy firms: chief among these are Accenture Interactive (a division of Accenture, a listed company) as the group with the best strategic positioning in digital marketing, though other large groups are also present in the market, e.g., Deloitte, Bain & Company, KPMG, PwC, and EY. These companies have net annual revenues on the order of 20 to 50 billion euros. In terms of their competitive strengths, these companies have a certain degree of integration of their specialised workforce (based at one or several offices), have a certain level of technology skills (with in-house programming, development, and engineering personnel), and are well positioned nationally. Making Science has some strengths with respect to these competitors, namely, its specialisation in digital marketing (rather than offering this as a relatively limited area within a broad range of services, except for Accenture Interactive, for which digital marketing is a core service) and its broad range of digital marketing services.
- Technology consultancy firms: chief among these are Indra (listed), which is increasingly investing in digital transformation and marketing (acquiring such firms as the Spanish company Paradigma in 2018), and Everis (an affiliate of NTT Data), Atos (listed), and Cognizant (listed), etc. These companies have net annual revenues on the order of 1 to 20 billion euros. In terms of their competitive strengths, these companies have high levels of technology skills (their main specialisation), have a certain degree of integration of their specialised workforce (based at one or several offices), and are well positioned nationally. Making Science has some strengths with respect to these competitors, namely, its specialisation in digital marketing (rather than offering this as a relatively limited area within a wide variety of services) and its broad range of digital marketing services.
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1.6.9. Corporate values and social commitment
Making Science has four corporate values that set it apart and provide a foundation for very rapid growth. The focus is on the individual and on talent development, enabling Making Science to grow as an organisation. These four corporate values are:
- Innovation and Growth: with the right skillset, organisational agility, and our knowledge-based culture, we can achieve continuous growth through a commitment to strategy, innovation, and excellence in our relationship with our clients.
- Customer and People Centric: we value our employees and clients, their goals, interests, and ambitions. We are committed to their success and to their growth, empowering them to become the best version of themselves.
- Bias for Action and Results: we strive for excellence through leadership in decision-making and creativity in everything we do. Our drive towards ongoing innovation distinguishes us in success and adds differential value that surprises our clients. We make things happen!
- Fairness and Collaboration: working together, practicing responsible decision-making, sharing knowledge, and working in close cooperation, appreciating diversity, and bringing talent together sets us apart, defines who we are, and is the source of our goals.
1.7. Strategy and Competitive Advantages
1.7.1. Strategy
Making Science's vision is to become the leading Spanish operator on the international stage, resting on the foundation of its positioning as a high value-added,one-stop provider for clients thanks to its integrated teamwork and its specialised know-how (232 advertising and data analytics consultants, creatives, programmers, and engineers, all based at the same office), to its ability to find technology solutions (proprietary solutions included), and to its access to the leading advertising platforms like Google Marketing Platform, Search Ads, and Facebook Ads.
Making Science has an aggressive plan for international expansion to be able to compete with the top independent global operators (companies that in some cases, like Jellyfish, have over 1,000 employees) and build a global network.
The Company's plan for international expansion includes a combination of both inorganic and organic growth and does not rule out either potential future share capital increases or debt financing, though the projections put forward in this Information Document contemplate only organic growth.
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1.7.2. Competitive Advantages:
Making Science leverages its competitive positioning as a differential value for client acquisition, namely, its provision of a national digital marketing team, its positioning as a one-stop provider, its integration of teams of specialists, its technological capabilities, and its position as a leader in ad tech.
Together, all these attributes combine to enable Making Science to achieve a high rate of conversion of proposals into new projects, with each of the attributes operating as a filter with respect to other service providers, driving clients in their decision to select the Company as a pre-eminent provider and enter into long-term relationships.
- Digital marketing team in the local market: Making Science's infrastructure and offices give it a local presence (on the date of issue of this Information Document for clients in Spain and Portugal, though new locations are under consideration). This contributes to communication with clients and to a knowledge of the local market.
- One-stopprovider: The Company offers a full 360º range of services that makes it a one-stop, strategic provider for clients helps mobilise new business through cross-selling. For example, in e-commerce, Making Science can offer the full range of services from brand identity creation and conceptualisation to developing complex machine learning models for analysing data and optimising e-commerce, as well as such connected services as design and UX (user experience), platform and infrastructure development, content management, SEO positioning, feed, paid digital advertising consultancy, and campaign metrics and analytics. Making Science has some clients (like Black Limba) for which it has mustered the entire gamut of services right from the outset, but this is not usual, since it entails creating the brand identity from scratch. Nevertheless, in most cases our services span several links in the chain for each client.
- Integration of specialised teams: The Company benefits from a high degree of integration among teams of diverse specialists (consultants, programmers, data analysts, creatives, engineers) who are all based at the same office. As of 25 November 2019, these offices house some 232 advertising and data analytics consultants, creatives, programmers, and engineers from five companies (The Science of Digital, S.L., Make Marketing y Comunicación, S.L., Crepes & Texas, S.L., Ingeniería para la Innovación I2TIC, S.L., and MCentric, Ltd.) who share the same space and interact on an ongoing basis at the same office on López de Hoyos Street in Madrid. The premises are large, with open spaces and a floor area of 1,900 square metres. The building is large enough to absorb personnel growth in the coming years, with higher floors available for more space.
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- Technology skillset: Making Science has a team of more than 60 engineers, programmers, and developers who are skilled in developing digital assets, Big Data models, proprietary in-house innovations, and implementations. This allows clients to implement and develop digital marketing technology according to their own needs and in that way optimise their marketing campaigns and their digital strategies.
o Digital asset and Big Data model development: the team of engineers, programmers, and developers is experienced at developing digital assets (web pages, e-commerce, ERP systems, CRM, cloud systems) to maximise data metrics and storage and at developing Big Data models and systems (artificial intelligence, machine learning) to take full advantage of data activation (i.e., analytics, automation, personalisation, alerts).
"Customer Interaction" Technology Platforms | ||||
Measurement | Activation | |||
Customer | Analytics | Ad Server | Purchasing | Production and |
Data | and Metrics | Platforms | Personalisation | |
CRM | Web Analytics | DSP | CMS | |
Sales | Tag Management | Tag Management | Advertising | |
First Party Data | Attribution | Attribution | production | |
DS | E-mailing | |||
Central Data Repository / DMP / Data Warehouse |
- Proprietary in-house technology development: the Company has developed Gauss AI and Nilo Commerce. Gauss AI is proprietary software for automating digital marketing actions based on data analytics models, using Google Marketing Platform technology. It has been installed at 10 clients and talks with another 10 are in progress. It has achieved significant improvements in the return on investment of campaigns. Nilo Commerce is proprietary software for developing e-commerce platforms with flexible, scalable architecture. It uses Google Cloud technology and has been designed to maximise sales conversion rates. Agreements for installation have been reached with two clients.
Digital marketing | Digital assets | Sales/delivery | Loyalty |
Lead Scorers | Product Recommendation Engine | Demand Forecasting | Best Next Product |
Cookie Scorers | (Home, Cart, Thank You) | Stocks | Personalised Pricing |
Cookie Clustering | Next Best Interaction | Sentiment Analysis | Refill of Products |
Dynamic Pricing | Consumer Journey | Product Enrichment | Forecasts |
Product Scorer | Alerts | ||
Category Listing Order |
Flexibility modular architecture for modifying or adding platform functionalities
Scalability designed to bear heavy traffic loads and to be highly cost efficient
Speed fast loading on devices of all kinds to minimise website abandonment
SEO optimised website design, development, and structuring to maximise traffic from Google
ChatBots with artificial intelligence to optimise the pre-sales and post-sales experience
Optimised page makeup time using globalising programming language and Atomic Design methodology
Artificial intelligence search engine to personalise the shopping experience
Shopping experience user-based and conversion-based approach
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- Partnerships and certifications: the Company is technically proficient in all the main digital advertising platforms (e.g., Google, Bing, Facebook, Amazon) and the leading digital advertising optimisation software solutions (e.g., Analytics, DoubleClick, Salesforce, HubSpot, VWO, Convert, Walmeric, Searchmetrics, Sistrix, SEMRush).
Other competitive strengths
A distinguished, experienced management team
Making Science has a reputed management team that includes former Google executives, experienced in a broad range of areas and geographic markets and trained in related fields.
Business model based on recurring clients and cross-selling, serving as the client's strategic partner.
Thanks to its positioning as its clients' strategic partner in the digital marketing field and its broad range of
services, Making Science has developed an ability to acquire and keep large clients, with high repetition rates and a high degree of cross-selling.
The Company positions itself as its clients' strategic partner for the desired digitisation and offers approachable, quality 360º services that cover all the different value chain requirements.
Of the total net revenues, media and ad tech technology sales excluded (because this line of business contributes hardly at all to the gross margin yet makes up a large share of net revenues and so could be a source of distortion) 84.7% in 2019 came from recurring clients (acquired in 2018 or earlier), and the client portfolio is recent (mainly between two and three years' standing or less), the average client maintenance in the sector ranging from five to seven years.
In terms of cross-selling, all of the Company's lines of business include large, reputable clients that tend to repeat as major clients in the other lines of business.
Culture and Values in Making Science
Making Science is an operational reality with its own separate but unified culture. Of the Company's current 268 employees, 229 were brought in following the mergers of companies whose operations were integrated at the same place of business in 2017.
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Making Science has four corporate values that set it apart and provide a foundation for very rapid growth. The focus is on the individual and on talent development, enabling Making Science to grow as an organisation. These four corporate values are:
- Innovation and Growth: with the right skillset, organisational agility, and our knowledge-based culture, we can achieve continuous growth through a commitment to strategy, innovation, and excellence in our relationship with our clients.
- Customer and People Centric: we value our employees and clients, their goals, interests, and ambitions. We are committed to their success and to their growth, empowering them to become the best version of themselves.
- Bias for Action and Results: we strive for excellence through leadership in decision-making and creativity in everything we do. Our drive towards ongoing innovation distinguishes us in success and adds differential value that surprises our clients. We make things happen!
- Fairness and Collaboration: working together, practicing responsible decision-making, sharing knowledge, and working in close cooperation, appreciating diversity, and bringing talent together sets us apart, defines who we are, and is the source of our goals.
1.8. Dependence on trademarks, patents and licenses:
Making Science is a Google Marketing Platform reseller and is also a partner of such other platforms as SearchMetrics and Tealium, among others.
Part of the business is associated with reselling this technology to third parties, though the business also operates on the basis of licenses sold by third parties. For instance, Making Science is providing its analytics and data services to various automotive clients and educational institutions on the basis of licenses sold by other resellers. There are also cases of the converse, where licenses sold by Making Science are being operated by other companies.
1.9. Diversification Level
1.9.1. Clients
Making Science has a highly diverse portfolio of more than 150 clients in different industries, with high repeat rates.
The Top 5 clients and the Top 15 clients in 2019 respectively accounted for 37% and 61% of the pro forma net consolidated revenues, media and ad tech technology sales excluded (because this line of business contributes hardly at all to the gross margin yet makes up a large share of net revenues and so could be a source of distortion). In alphabetical order, the 15 main clients in 2019 were Altamira, Globacom, IFEMA,
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IKI Media, Inditex, KaveHome, Mapfre Salud Digital, L'Oréal, Openbank, Pescanova, RIU Hotels, Selenta, StubHub, Universidad Internacional de la Rioja (UNIR), and Verti:
Thousands of | ||||||||||||
euros | ||||||||||||
2019 | % of total | 2019 | % of total | |||||||||
Client | July 2019 | 2019 | ||||||||||
(7 months) | (full year) | |||||||||||
(7 months) | (full year) | |||||||||||
1 | 974 | 15.6% | 1,493 | 13.1% | ||||||||
2 | 472 | 7.6% | 914 | 8.0% | ||||||||
3 | 408 | 6.5% | 722 | 6.3% | ||||||||
4 | 299 | 4.8% | 532 | 4.7% | ||||||||
5 | 277 | 4.4% | 513 | 4.5% | ||||||||
6 | 233 | 3.7% | 461 | 4.0% | ||||||||
7 | 184 | 2.9% | 390 | 3.4% | ||||||||
8 | 170 | 2.7% | 345 | 3.0% | ||||||||
9 | 169 | 2.7% | 338 | 3.0% | ||||||||
10 | 143 | 2.3% | 286 | 2.5% | ||||||||
11 | 133 | 2.1% | 214 | 1.9% | ||||||||
12 | 113 | 1.8% | 212 | 1.9% | ||||||||
13 | 88 | 1.4% | 187 | 1.6% | ||||||||
14 | 81 | 1.3% | 173 | 1.5% | ||||||||
15 | 78 | 1.3% | 171 | 1.5% | ||||||||
Top 5 | 2,429 | 39.0% | 4,173 | 36.6% | ||||||||
Top 15 | 3,821 | 61.3% | 6,950 | 60.9% | ||||||||
Total | 6,235 | 100.0% | 11,417 | 100.0% |
Recurring client revenues
A large proportion of the net revenues, media and ad tech technology sales excluded, comes from recurring clients. Of the top 15 clients by net revenues in 2019, media and ad tech technology sales excluded (for the reasons already referred to above), 93.7% were recurring clients (acquired in 2018 or earlier), and the client portfolio is recent (mainly between two and three years' standing or less), the average client maintenance in the sector ranging from five to seven years.
Thousands of euros | ||||||||||||
Client by year of | July 2019 | % of total | 2019 | % of total | ||||||||
July 2019 | 2019 | |||||||||||
acquisition | (7 months) | (full year) | ||||||||||
(7 months) | (full year) | |||||||||||
2019 | 143 | 3.7% | 461 | 6.3% | ||||||||
2018 | 699 | 18.3% | 1,216 | 19.0% | ||||||||
2017 | 788 | 20.6% | 1,376 | 22.0% | ||||||||
2016 | 613 | 16.1% | 1,070 | 15.4% | ||||||||
2015 | 472 | 12.3% | 904 | 13.5% | ||||||||
2014 and earlier | 1,106 | 29.0% | 1,946 | 30.0% | ||||||||
Recurring clients (2018 | 3,678 | 96.3% | 6,512 | 93.7% | ||||||||
and earlier) | ||||||||||||
Top 15 | 3,821 | 100.0% | 6,950 | 100.0% |
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Diversification by sector
In this connection, net revenues, media and ad tech technology sales excluded (for the reasons already referred to above), come from clients spanning a wide range of industries. For the top 15 clients by net revenues in 2019, media and ad tech technology sales excluded, the main sectors were telecommunications, insurance, retail and consumer sales, and hotels, accounting for 14.8%, 18.0%, 21.4%, and 8.2%, respectively, and to a lesser extent the food sector, banking, and real estate, accounting for 3.9%, 5.4%, and 4.7%.
Thousands of euros | ||||||||||||
July 2019 | % of total | 2019 | % of total | |||||||||
Client by sector | July 2019 | 2019 | ||||||||||
(7 months) | (full year) | |||||||||||
(7 months) | (full year) | |||||||||||
Telecommunications | 974 | 25.5% | 1,493 | 21.5% | ||||||||
Insurance | 707 | 18.5% | 1,600 | 23.0% | ||||||||
Retail and consumer | 585 | 15.3% | 1,293 | 18.6% | ||||||||
sales | ||||||||||||
Hotels | 446 | 11.7% | 877 | 12.6% | ||||||||
Food sector | 233 | 6.1% | 390 | 5.6% | ||||||||
Banking | 170 | 4.5% | 286 | 4.1% | ||||||||
Real estate | 159 | 4.2% | 213 | 3.1% | ||||||||
Other | 546 | 14.3% | 799 | 11.5% | ||||||||
Top 15 | 3,821 | 100.0% | 6,950 | 100% |
Geographic diversification of clients
In this connection, Making Science's business is highly concentrated in Spain, accounting for 83.7% of net revenues in 2019, media and ad tech technology sales excluded (for the reasons already referred to above).
1.9.2. Suppliers
In terms of vendor diversification, the Top 4 vendors supplied 91% of pro forma total purchases in 2019, the top-ranked vendor accounting for 73%, the second 10%, the third 7%, and the fourth 1%. In alphabetical order, the Top 4 vendors were Amazon, Facebook, Google, and Señor Gorsky (media agency).
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1.10. Brief description of the group of Issuer Companies. Description of the characteristics and activity of the subsidiaries with significant effect on the valuation or Issuer status.
The Making Science Group is composed of the following companies:
- Making Science Group, S.A. (formerly Make Marketing y Comunicación, S.L.), the Group's parent company, which also includes the line of business of The Science of Digital, S.L. (via contribution of that line of business to the newly established company Propuesta Digital, S.L. and subsequent reverse merger into Making Science Group, S.A.).
- Ingeniería para la Innovación I2TIC, S.L., wholly owned by Making Science Group, S.A.
- Crepes & Texas, S.L., wholly owned by Making Science Group, S.A.
- MCentric, Ltd., wholly owned by Making Science Group, S.A., which carries on its main business through its wholly owned affiliate, MCentricksd, S.A.
- Making Science Digital Marketing, S.L. (formerly Artificial Intelligence Algorithmics, S.L.), wholly owned by Making Science Group, S.A.
- Probability Domain Unipessoal, Lda., wholly owned by Making Science Group, S.A.
- Making Science Labs, S.L. (formerly Making Science, S.L.), wholly owned by Making Science Group, S.A.
- Omniaweb Italia, S.R.L., wholly owned by MCentric, Ltd.
The net revenues and gross margin in 2018 and 2019 for each of the aforesaid integrated companies are shown below:
Net revenues | Net revenues | ||
Year of | and gross | and gross | |
Company | margin in 2018 | margin in 2019 | |
incorporation | |||
(full year) (in | (full year) (in | ||
millions) | millions) | ||
Making Science | 2001 | €4.5 and €2.8 | €25.1 and €3.3 |
Group, S.A. | |||
The Science of | |||
Digital, S.L. (assets | 2016 | €13.6 and €2.7 | €26.9 and €2 |
and liabilities | |||
transferred to | |||
Making Science | |||
Group, S.A.) | |||
2010 | €1.1 and €1.0 | €1.8 and €1.6 | |
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Ingeniería para la | ||||||||
Innovación I2TIC, | ||||||||
S.L. | ||||||||
Crepes | 2013 | €1.3 and €1.0 | €1.2 and €1 | |||||
& Texas, S.L. | ||||||||
Making Science | ||||||||
Digital Marketing, | 2017 | €8.2 and €0.3 | €10.4 and €2 | |||||
S.L. | ||||||||
MCentric, Ltd. | 2000 | €1.2 and €1.1 | €1.8 and €1.7 | |||||
Probability | ||||||||
Domain | 2017 | €0.4 and €20 | €0.4 and €38 | |||||
Unipessoal, Lda. | ||||||||
Making Science | 2016 | - | €0.1 and €0.1 | |||||
Labs, S.L | ||||||||
Omniaweb Italia, | 2020 | - | - | |||||
S.L.R. | ||||||||
Making Science | 2001 | €18.8 and €9.0 | €35.5 and €11.5 | |||||
Group, S.A. | ||||||||
(consolidated) |
1.11. Reference to environmental aspects that may affect the Issuer activity
Due to the activity performed by the Company, it has no environmental liabilities, expenses, assets or provisions and contingencies that could be considered significant with regards to its assets, financial situation or results.
1.12. Information on significant trends in production, sales and Issuer costs from the end of the last fiscal year to the date of the document
In order for it to have a policy of transparency for investors, the Company decided to publish its forecast for 2020, which was passed by the Board on 23 December 2019. This also included some general guidelines on the expectations for growth in 2021-22.
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Thousands of euros | 2020e |
Net turnover | 46,750 |
Costs of goods sold | -33,800 |
Gross profit | 12,950 |
Capitalisation of intangible assets | 800 |
Personnel expenses | -8,509 |
% of gross profit | -65.7% |
Other operating expenses | -2,253 |
% of gross profit | -17.4% |
Other operating revenues | - |
EBITDA | 2,988 |
% of gross profit | 23.1% |
Recurring EBITDA | 3,063 |
% of gross profit | 23.7% |
Other non-recurrent operating expenses | 75 |
In 2020, Making Science projected that its net turnover would increase to EUR 46.8 million, with a gross profit margin of EUR 13.0 million, and a recurring EBITDA of EUR 3.1 million (a margin of 23.7%).
The main hypotheses for the growth in revenue are: | ||
Thousands of euros | 2020e | |
Net turnover | 46,750 | |
Digital advertising | 41,400 | |
Paid advertising consulting | 4,700 | |
Organic advertising consulting | 1,700 | |
Creativity and content | 1,800 | |
Marketing of media and technology | 33,200 | |
Data analysis and development | 5,350 | |
Advertising data analysis | 1,000 | |
Web and cloud development | 2,150 | |
Internal technology | 400 | |
Big Data development | 1,800 |
Forecasts for 2021 and 2022
Making Science projects its net turnover and its gross profit margin to go up by around 15% a year starting in 2021. For its EBITDA, the Company expects to reach levels in respect of its gross profit margin of at least the level forecasted for 2020.
The Company's published estimates were drawn up using criteria that were comparable to those used for its historical financial reporting. These criteria are laid out in the General Accounting Plan. These assessment rules and criteria are also provided in its 2018 and 2019 Annual Financial Statements.
The main assumptions and factors that may substantially affect reaching these forecasts are detailed in section 1.18 of this Information Document, the following of which should be stressed:
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- Dependence of managers and key personnel
- Risk related to keeping up competitive advantages long term
- Risk of signing up clients
- Concentration of activity in Spain
- Risk related to geographic expansion
- Risk associated with the ability to seal new strategic partnerships and acquire companies
- Risk related to being one of Google's top partners in Spain and the ability to repeat that position in new markets
- The cyclical nature of the sector
- Risk of competition
- Risk related to the concentration of suppliers in the sector
- Risk related to technological disruption
Investors are advised to read them carefully with the information presented in this Information Document before making a decision on whether to make an investment by acquiring shares in the Company, as these factors may adversely affect the Company's business, its prospectives, its financial and economic situation, and its assets, and ultimately its valuation. It is also important to bear in mind that since the Company's shares have never been listed on a market, there are no guarantees as to the share volumes that will be sold or their effective liquidity.
The Board meeting of 23 December 2019 unanimously approved these estimates as information for potential investors and moved to track them and their fulfilment, undertaking to inform the Market if the business plan's main variables point to likely upward or downward deviations of 10% or more. Nevertheless, for other reasons, some variations of less than 10% may be significant. In both cases, this would constitute a relevant fact for the purposes of reporting to the Market.
1.13. Information of the directors and senior executives of the Company
1.13.1. Corporate Structure and Board of Directors
The Company's governing body is a Board of Directors with the following main characteristics:
a) Structure of the governing body
According to article 8 of the articles of association, the Company's governing bodies are its General Shareholders' Meeting and is Board of Directors.
b) Term of the position
Accordance with article 16 of the articles of association, directors serve a six-year term that must have the same duration for all of them, without prejudice to the ability to be re-elected, and to the General Meeting's
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power to remove directors at any time pursuant to the Spanish Corporate Enterprises Act (Ley de Sociedades de Capital).
If vacancies arise during a Director's appointed term and there is no one to fill it, the Director in question may designate one of the shareholders to hold the position until the first General Meeting is convened.
- Composition
Pursuant to article 15 of the articles of association, the Board is to be made up of a minimum of 3 and a maximum of 12 members.
The Company's board of directors is currently made up of the following 6 members:
Director | Position | Type | Date appointed | |||
José Antonio Martínez Aguilar | Chair | Executive | 15/11/2019 | |||
Álvaro Verdeja Junco | Member | Executive | 15/11/2019 | |||
Isabel Aguilera Navarro | Member | Independent | 15/11/2019 | |||
Alfonso Osorio Iturmendi | Member | Independent | 15/11/2019 | |||
The Science of Digital, S.L. | ||||||
(represented by José Antonio | Member | Proprietary | 15/11/2019 | |||
Martínez Aguilar) | ||||||
Bastiat Internet Ventures, S.L. | ||||||
(represented by Luis Moreno | Member | Proprietary | 15/11/2019 | |||
García) | ||||||
Juan Verdasco Giralt | Secretary (non-board | - | 15/11/2019 | |||
member) | ||||||
d) Audit Committee
The Audit Committee is an internal informative and consultative body without executive functions that has the power to provide information, advice and proposals in areas under its purview. More specifically, the Audit Committee has the duties and competences specified under the legislation in force.
The Company's Audit Committee current consists of the following three members:
Director | Position | Date appointed | ||
Alfonso Osorio Iturmendi | Chair | 20/11/2019 | ||
Isabel Aguilera Navarro | Member | 20/11/2019 | ||
Bastiat Internet Ventures, S.L. | Member | 20/11/2019 | ||
(represented by Luis Moreno García) | ||||
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1.13.2. Career and professional profile of the management team
Board of Directors
José Antonio Martínez Aguilar
CEO and Chair of the Board of Directors. Appointed on 15 November 2019. He was General Manager of Google Portugal and manager of various divisions at Google Spain and Canada until 2016, after 10 years' experience. He was one of the first employees of Airtel-Vodafone in Spain, where he was General Manager of the Internet Business Unit and Director of Development of Products and Services. He is a founding partner of MCentric (2000) and The Science of Digital (2016). A Professor of Digital Strategy, he holds an MBA from IE Business School (2012 - 2018). He received a Master's in Business Administration (MBA) from IE Business School, and holds a degree in Advanced Telecommunications Engineering from the Polytechnic University of Madrid. He also studied Economics at the National Remote Eduction University and a Doctorate in Artificial Intelligence at the Information Technology School of the Polytechnic University of Madrid.
Álvaro Verdeja Junco
Member of the Board of Directors. Appointed on 15 November 2019. He is COO and co-founder of the Making Science Group, and has been the COO of Make since 2006. He previously worked at Mercedes Benz, the Uralita Group and Startupbootcamp. He is a founding partner of WOPT, and Uva y Bellota.
He is Director of the Official Master's programme at the Google Marketing Platform, and one of the top experts in the market in adtech and martech. He holds a degree in International Business Management and Administration (E-4) from the Pontifical University of Comillas (ICADE).
Isabel Aguilera Navarro
Member of the Board of Directors and member of the Audit Committee. Appointed on 15 November 2019. She is a strategy and innovation consultant and an associate professor at the ESADE, in addition to being an independent director in many listed companies including: Cemex, Farmafactoring, Lar España, Oryzon Genomics and Hightech Payment Systems. She has also served as in independent director on the boards of Indra, Banco Marenostrum, Aegón España, Laurate Inc., and other companies. Before that, she was Chairwoman of General Electric in Spain and Portugal (2008-2009), General Manager of Google in Spain and Portugal (2006-2008) and Director of Operations at NH Hoteles (2002-2005) and General Manager of the Dell Computer Corporation, where she led the Spain. Italy and Portugal business units (1997-2002). She also held roles in the sales and marketing divisions at Olivetti PC, Airtel (Vodafone) and Hewlett- Packard. She was named one of the top 25 best executives by the Financial Times, and one of the 50 most influential managers in the world by Fortune, in addition to other recognitions. A graduate of the IESE's General Management programme, she holds a Master's in Commercial Management and Marketing from IE Business School and a licentiate in Architecture and Urban Planning from the Advanced Technical School of Architecture of Seville.
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Alfonso Osorio Iturmendi
Member of the Board of Directors and Chairman of the Audit Committee. Appointed on 15 November 2019. Chairman of BDO Spain since June 2006. A member of the BDO International Council since 1995, and a member of the BDO EMEA Board from 2008 to 2016. He has over 30 years' experience providing service to international clients. He graduated from the Top Management Program (PAD) of IE Business School and holds a licentiate in Economics from the Complutense University of Madrid.
Luis Moreno García
Member of the Board of Directors. Appointed on 15 November 2019. He is a chartered administrative manager and tax adviser. He studied Business Management and Administration, earning a Master's in Tax Advice from the Centre of Financial Studies and a Master's in Business Management. His previous experience includes work as an account executive at X-Trade Brokers Dom Maklerski (a leading broker in the FX and CFD markets). He is currently a partner and manager of the tax advisory division of Cepresa.
Juan Fernando Verdasco Giralt
Secretary (non-member) of the Board of Directors. Appointed on 15 November 2019. He has practised as a lawyer and a tax adviser, as a partner at B&V Abogados, specialising in corporate, tax and civil law. He holds a licentiate in Law and in Economics and Business Sciences from the Pontifical University of Comillas (ICADE).
Managers
Patricia Yuste
Director of Marketing Services (Digital Advertising). She has over 13 years' experience in the digital sector, having worked on the digital transformation of various companies and held Director of Digital Marketing positions at the European University for Spain and Portugal and Abbvie laboratories. She also
worked as the head of Digital Marketing at Legálitas. She holds a Master's in Digital Marketing from the ESIC and a diploma in Occupational Therapy from the Complutense University of Madrid.
Miguel López Sánchez
Director of Technology and Systems. He is a founding partner of I2TIC (2010). He is a recognised expert in cyber-security in scalable systems. He has prior experience as an IT consultant at Técnicas Territoriales y Urbanas. He graduated in Telecommunications Engineering at the University of Alcalá.
Antonio Negro
Director of Innovation. He was Head of Startups & Performance at Google until 2018, with over ten years' of experience. He is an adviser in technology, business development and marketing for Ticketbis, Localistico, Heretics, Agua3, and others. He is an MBA professor at Camilo José Cela University, and
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holds a licentiate in Humanities from Sapienza University in Rome, and a Master's in Business Administration (MBA) from IE Business School (2012-14).
Óscar Lillo
Chief Financial Officer. He was the Financial Director of the Americas Division and Director of Corporate Finance at Natra. He also was the Director of Treasury and Corporate Finance at the Siro Group. He also worked previously as International Controller, Corporate Finance and Auditing at Cepsa. An Executive MBA graduate from the IE Business School (2008-09), he holds a Licentiate in Economics from Carlos III University and the Université Catholique de Louvain (Belgium).
Javier Mora
Director of Program Management. He was COO of Rosmiman Software Corporation, in Dubai (2015-18), and Project Manager of Sistemas de Telecomunicaciones in Abengoa (2010-15), with prior experience at Applus, Unión Fenosa and Vodafone. He holds a licentiate from the PMP Institute, and graduated in Telecommunications Engineering from the UCAM and the University of Alcalá.
Clara Ballesteros
Director of People & Culture. Previously, she held the same position in different media agencies such as Ymedia VIzeum, Wink TTD and DentusX for 2 years. Previously, she developed her professional career as HRBP in different sectors such as defense and engineering and fast growing companies such as Primark or Maxam. She has a master's degree in Human Resources Management specialized in Compensation from the Centro de Estudios Garrigues and Business Administration and Tourism Degree.
Gonzalo Valdés
Director of Strategy. He is more than 10 years experienced in strategic consulting, with a special focus on technology and large companies digital transformation, working as a strategic projects director and account manager at The Cocktail and Oliver Wyman. He has developed his career in Europe and Latin America in industries such as finance, insurance, telecommunications, travel, retail and RE. He holds a MsC in Civil Engineering, major in transport systems, by ETSI de Caminos Canales y Puertos (UPM)
Jorge Alonso
Director of Automation and Dublin Operations. He has 10 years of experience managing operations for digital marketing companies. He was responsible for the P&L of JOT Internet Media. Alonso was in charge of strategic partnerships and improving the efficiency of the whole company throughout the use of technology and process automation. Before that, he occupied several sales roles in technological consultancies, with focus on clients in the financial sector. He holds a MsC in Agricultural Engineering by ETSI Agrónomos (UPM).
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Kevin Daly
Director of International Partnerships. He is the founding partner and CEO of MCentric (2000-present). Director of Systems and IT at AirTouch Communications (1987-1999), including the position of IT Director (1994-97). He was the CIO and head of systems launch for Airtel-Vodafone Spain (1995-1997. Director of Zamudio's Software Development Centre. . He was the CIO and head of systems launch for Vodafone Portugal (Telecel) (1991-1993), with over 15 years' experience in information technologies for telecommunications companies in Africa, Asia, Europe, Latin America and the United States.
Santiago Larrauri
Director of Business Development. He was Business Development Consultant at The Cocktail (2016-17), and Manager of Google's Mobile Innovation Hub (2015-16), with prior experience at Zoompin, Mobivery, Altran and MS. He holds a Master's in Business Administration (E-MBA) from IESE (2017-18), and a licentiate in Computer Engineering from the Autonomous University of Madrid,
Carlo Baratti
Director of International Development. With over ten years' experience in technology sales and Martech, he was Sales Director for Google Analytics 360 for Southern Europe, and Director of International Sales for Tag Commander and Algolia. He holds a double degree from the University of Strasbourg (Master's in International Management) and the University of Milan (Master's in Economics and Business Management).
Manuel Morote Sánchez
Director of Brand Strategy, Social Media and SEO. He has over eight years' experience in the field of contents, SEO and brand strategy. He holds a licentiate in Political Science and Administration from the Autonomous University of Madrid, and a Master's in Social Media and Community Management from the Complutense University of Madrid.
Óscar López
Director of Software Engineering. He holds a degree in telecommunications engineering from the University of Alcalá and founded I2TIC. A professor of Programming Languages at the University of Alcalá, he has over 15 years' experience developing highly complex software environments and e- commerce.
Carmen de Leyva Torán
Director of Creativity and Design. She is the co-founder of Crepes & Texas and led all of the creativity and design teams. She holds a licentiate in Business Administration from the Pontifical University of Comillas (E2).
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Mónica González Neira
Communication and Marketing Director. With over 15 years' experience in communications and marketing in multi-national companies, she is the Marketing Director of 1and1 Spain and LatAm, and the Senior Communications Technician at Telvent. She holds a licentiate in Marketing and Public Relations from the Complutense University of Madrid.
1.14. Information about the Employees:
1.14.1. Number of Employees, Geographical Distribution and Profile.
The Company has 268 employees as of 1 September 2020. Based on the lines of business, profiles and functions, the employees are distributed into 130 employees in digital advertising (primarily with profiles of consultants and creative employees), 76 employees in data analysis and development (mainly with profiles of consultants, data analysts, programmers, developers and engineers) and 40 employees in the central structure (which includes the program management, administration and finances, human resources, marketing and communications, and general management departments).
Distribution by line of business | ||
Distribution of employees as at 25 November 2019 | ||
Digital advertising | 126 | |
Payment advertising, media marketing and adtech technology | 65 | |
Organic advertising | 30 | |
Creativity and content | 31 | |
Data analysis and development | 96 | |
Advertising data analysis | 25 | |
Web and cloud development | 45 | |
Internal technology | 1 | |
Big Data development | 22 | |
PM Global tech | 3 | |
Central structure | 46 | |
Total | 268 | |
Based on its geographical distribution, 95% of the employees at 1 September 2020 are located in Making Science's Madrid offices, with the other 3% divided between IKI Media's offices in Barcelona (9 employees), the new offices in Valencia (3 employees), the new offices in Mexico City (1 employee) and in Paris (1 employee).
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Distribution of employees as at 25 November 2019
Madrid | 254 |
Barcelona | 9 |
Mexico City | 1 |
Valencia | 3 |
Paris | 1 |
Total | 268 |
1.14.2. Internal Organization:
The Company's employees are organised into the following organisational structure:
1.15. Main Shareholders | ||
At 30 June 2020, the main shareholders of Making Science are: | ||
Shareholder | % | |
The Science of Digital, S.L. (José Antonio Martínez) | 71.86% | |
Álvaro Verdeja Junco | 8.01% | |
Kuzdu Inc. (Kevin Daly) | 2.34% | |
Bastiat Internet Ventures, S.L. (José Antonio Martínez) | 2.32% | |
Total | 100.0% |
José Antonio Martínez Aguilar, CEO and Chairman of the Board of the Company, holds a total direct and indirect stake of 74.18% in Making Science, including 71.86% through his holdings in The Science of
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Digital, S.L. and 2.34% through Bastiat Internet Ventures, S.L., both of which are fully held by José Antonio Martínez and his spouse.
The directors and board members with direct and indirect stakes of over 1% in Making Science's share capital are, as of the date of this Information Document, José Antonio Martínez Aguilar, Álvaro Verdeja Junco and Kevin Daly, with the ownership stakes indicated above.
1.16. Other operations with related parties
According to Spanish Ministerial Order EHA/3050/2004, of 15 September, a party is considered to be associated to another party when one of them, or a group of them acting jointly, directly or indirectly or by virtue of agreements or accords between shareholders exercises or is capable of exercising significant influence over the other's financial and operational decisions.
Under section three of the abovementioned Spanish Ministerial Order EHA/3050/2004, the following are classified as related-party transactions:
"(…)
all transfers of resources, services and obligations between the related parties, regardless of whether this is done for consideration. In any case, the following types of transactions with related parties must be reported: Purchases and sales of goods, whether finished or unfinished; purchases and sales of fixed assets, whether tangible, intangible or financial; provision and receipt of services; collaboration agreements; financial lease agreements; research and development transfers; licensing agreements; financing agreements, including loans and capital contributions, whether in cash or in kind; interest paid and charged; and interest accrued but not paid or received; dividends and other benefits distributed; guarantees and endorsements; management contracts; remuneration and compensation; contributions to pension plans and life insurance; benefits to be offset with own financial instruments (stock option plans, convertible bonds, etc.) ); commitments to buy or sell options and other instruments that may involve a transfer of resources and obligations between the company and the related party;
(…)".
The price policy followed in all of the transactions completed during the periods ended on 31 December 2017, 31 December 2018 and 31 December 2019 adhered to the application of normal market price, in accordance with the Spanish Corporate Income Tax Act (Ley del Impuesto de Sociedades).
Making Science Group, S.A.'s significant transactions and balances with related parties are detailed below, as taken from its individual financial statements at 31 December 2017, 31 December 2018 and 31 December 2019.
Transactions are classified as significant if their sum is greater than 1% of the Company's revenues or equity.
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Thousands of euros | 31/12/2017 | 31/12/2018 | 31/12/2019 | ||||
Net turnover | 3,278 | 4,522 | 25,159 | ||||
Equity | 643 | 861 | 1,863 | ||||
1% of revenues | 33 | 45 | 252 | ||||
1% of equity | 6 | 9 | 19 | ||||
(i) | Transactions with significant shareholders | ||||||
Balances with significant shareholders | 2017 | 2018 | 2019 | ||||
(euros) | |||||||
Payable balances | 214,567 | 82,043 | 112,312 | ||||
The Science of Digital, S.L. | 214,567 | 82,043 | 112,312 | ||||
Non-current investments | - | - | - | ||||
The Science of Digital, S.L. | - | - | - | ||||
Current investments | - | - | 540,291 | ||||
The Science of Digital, S.L. | - | - | 540,291 | ||||
Receivable balances | (191,665) | (315,238) | (5,012,241) | ||||
The Science of Digital, S.L. | (191,665) | (315,238) | (5,012,241) | ||||
Current payables | - | (460,017) | (565,100) | ||||
The Science of Digital, S.L. | - | (460,017) | (565,100) | ||||
Transactions with significant shareholders | 2017 | 2018 | 2019 | ||||
(euros) | |||||||
Services performed | 379,422 | 880,720 | 7,549,574 | ||||
The Science of Digital, S.L. | 379,422 | 880,720 | 7,549,574 | ||||
Services received | (167,401) | (667,469) | (14,257,327) | ||||
The Science of Digital, S.L. | (167,401) | (667,469) | (14,257,327) |
The transactions with The Science of Digital, S.L. mainly correspond to internal re-invoicing for digital marketing marketing services and data analysis for third parties.
(ii) | Transactions with managers and directors | |||
Balances with managers and directors | 2017 | 2018 | 2019 | |
(euros) | ||||
Non-current payables | - | (698,750) | - | |
José Antonio Martínez Aguilar | - | (698,750) | - | |
Current payables | - | (450,000) | (100,000) | |
José Antonio Martínez Aguilar | - | (450,000) | (100,000) | |
Current account with partners and managers | - | - | - | |
José Antonio Martínez Aguilar | - | - | - |
The current payables to José Antonio Martínez Aguilar come from the deferred payment for the acquisition of Making Science Digital Marketing, S.L.
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Transactions with managers and directors | 2017 | 2018 | 2019 |
(euros) | |||
Remuneration (Salaries, per diems and other | 155,096 | 204,244 | 63,645 |
remuneration) | |||
There are no advances and credits paid to members of the Company's Board and senior managers, and there are no pension and insurance commitments.
- Transactions between persons, companies and entities of the group
Balances with group companies and people | 2017 | 2018 | 2019 |
(euros) | |||
Payable balances | - | 24,464 | 5,709,782 |
Making Science Labs, S.L. | - | - | 14,492 |
Making Science Digital Marketing, S.L. | - | - | 4,844,883 |
Probability Domain Unipessoal Lda. | - | - | 609,461 |
Ingeniería para la Innovación I2TIC, S.L. | - | 21,358 | 43,872 |
Crepes & Texas, S.L. | - | 3,106 | 16,332 |
MCentricksd, S.A. | - | - | 180,742 |
Non-current investments | - | 3,071,000 | 4,332,379 |
Making Science Labs, S.L. | - | 3,000 | 33,000 |
Making Science Digital Marketing, S.L. | - | 1,148,750 | 1,148,750 |
Probability Domain Unipessoal Lda. | - | - | 3,000 |
Ingeniería para la Innovación I2TIC, S.L. | - | 934,000 | 934,000 |
Crepes & Texas, S.L. | - | 985,250 | 985,250 |
MCentricksd, S.A. | - | - | - |
MCentricksd, Ltd | 1,228,379 | ||
Current investments | - | - | 777,340 |
Making Science Labs, S.L. | - | - | 30,381 |
Making Science Digital Marketing, S.L. | - | - | - |
Probability Domain Unipessoal Lda. | - | - | - |
Ingeniería para la Innovación I2TIC, S.L. | - | - | 363,375 |
Crepes & Texas, S.L. | - | - | 373,552 |
MCentricksd, S.A. | - | - | 10,032 |
Receivable balances | - | (148,200) | (1,983,671) |
Making Science Labs, S.L. | - | - | (23,690) |
Making Science Digital Marketing, S.L. | - | - | (979,589) |
Probability Domain Unipessoal Lda. | - | - | (72,000) |
Ingeniería para la Innovación I2TIC, S.L. | - | (119,616) | (326,294) |
Crepes & Texas, S.L. | - | (28,584) | (455,029) |
MCentricksd, S.A. | - | - | (85,948) |
MCentricksd, Ltd | (41,121) | ||
Current payables | - | - | (2,907,682) |
Making Science Labs, S.L. | - | - | (30,000) |
Making Science Digital Marketing, S.L. | - | - | (2,877,361) |
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Probability Domain Unipessoal Lda. | - | - | - |
Ingeniería para la Innovación I2TIC, S.L. | - | - | (321) |
Crepes & Texas, S.L. | - | - | - |
MCentricksd, S.A. | - | - | - |
Transactions with group companies and people | 2017 | 2018 | 2019 |
(euros) | |||
Services performed | - | 187,470 | 3,197,525 |
Crepes & Texas, S.L. | - | 95,259 | 29,251 |
Making Science Digital Marketing, S.L. | - | - | 2,814,133 |
Making Science Labs, S.L. | - | - | 37,109 |
MCentricksd, S.A. | - | - | 130,806 |
Ingeniería para la Innovación I2TIC, S.L. | - | 92,211 | 186,226 |
Services received | - | (432,658) | (1,892,816) |
Crepes & Texas, S.L. | - | (230,589) | (246,921) |
Making Science Digital Marketing, S.L. | - | - | (968,848) |
Making Science Labs, S.L. | - | - | (35,678) |
MCentricksd, S.A. | - | - | (38,120) |
Ingeniería para la Innovación I2TIC, S.L. | - | (202,069) | (603,249) |
The transactions mainly correspond to internal re-invoicing for digital marketing marketing services and data analysis for third parties.
1.17. Financial information, adverse opinions and information of dividend distribution.
It should be stressed that the 2018 and 2019 pro-forma consolidated annual financial statements, the 2019 audited consolidated annual financial statements and the 2018 and 2019 audited individual financial statements are attached to this Information Document.
Since the main companies were added to the Group recently (from Q1 2018 to Q4 2019), in order to provide a better understanding of the Company and particularly its organic growth trajectory, Making Science Group, S.A.'s pro forma financial statements were consolidated and audited by Grant Thornton in its report on resolved procedures. Making Science Group, S.A.'s consolidated pro forma financial statements for the years ended 31 December 2018 and 31 December 2019 were drawn up taking into account all of the companies in the consolidation perimeter effective as of 1 January 2018. The following method was used to calculate the consolidate pro forma financial information (profit and loss account and balance sheet), which was audited by Grant Thornton:
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- First, aggregate financial statements were calculated by adding up all of the figures on the profit and loss account and the balance sheet of the companies comprising within the perimeter at the date of this Information Document and mentioned in the top table.
- Second, the transactions conducted between the companies within the perimeter were identified and eliminated.
- Lastly, the abovementioned adjustments for intra-group transactions were eliminated on the aggregate financial statements to obtain the pro forma consolidated financial statements.
1.17.1. Financial Information of 2018 and 2019:
Consolidated pro-forma balance sheet
The pro forma consolidated balance sheets for the years closed 31 December 2019 (audited by Grant Thornton in its resolved procedures report), 31 December 2018 (audited by Grant Thornton in its resolved procedures report) and 31 December 2017 (presented merely for comparison without a third-party audit) are presented below:
Thousands of euros | 2017 | 2018 | 2019 |
Non-current assets | 2,157 | 6,408 | 6,890 |
Intangible assets | 380 | 609 | 5,592 |
Property, plant and equipment | 134 | 176 | 291 |
Non-current investments Group companies and associates | 657 | 2,933 | 920 |
Non-current financial investments | 987 | 101 | 87 |
Consolidation goodwill | - | 2,590 | - |
Current assets | 8,134 | 10,783 | 21,126 |
Inventories | 96 | 115 | 6 |
Commercial debtors and other receivables | 5,423 | 4,791 | 12,968 |
Current investments Group companies and associates | 10 | -7 | 552 |
Current financial investments | 488 | 665 | -19 |
Short-term accruals | 127 | 0 | 59 |
Cash and cash equivalents | 1,991 | 5,218 | 7,560 |
Total assets | 10,291 | 17,191 | 28,016 |
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Net equity | -34 | 739 | 2,448 |
Share capital | 1,890 | 1,282 | -1,038 |
Reserves | -2,651 | 5,089 | -655 |
Share premiums | - | - | 2,595 |
Prior years' results | -212 | -3,270 | |
Official capital subsidies | 20 | 38 | 37 |
Shareholder contributions | - | - | 240 |
Profit/(loss) for the year | 918 | -2,399 | 1,269 |
Non-current liabilities | 4,248 | 3,447 | 2,836 |
Non-current provisions | - | - | 1 |
Non-current debts | 3,439 | 2,290 | 2,361 |
Non-current debts of Group companies and affiliates | 781 | 1,116 | 418 |
Liabilities from differed taxes | 28 | 41 | 56 |
Current liabilities | 6,077 | 13,006 | 22,732 |
Short-term provisions | 37 | 33 | 2 |
Current debts | 1,353 | 2,890 | 6,464 |
Current debts to group affiliates and associated companies | - | 1,230 | 118 |
Trade and other payables | 4,784 | 6,106 | 13,198 |
Short-term accruals | -97 | 2,746 | 2,950 |
Total net equity and liabilities | 10,291 | 17,191 | 28,016 |
Intangible fixed assets
There was a balance of EUR 5,592 thousand in 2019 and EUR 609 thousand in 2018, consisting of research, development and goodwill.
Intangible fixed assets by item | 2018 | 2019 | |
(thousands of euros) | |||
Research and development | 609 | 1,324 | |
Goodwill | - | 4,268 | |
Intangible fixed assets | 609 | 5,592 |
- Research and development: balance of EUR 1,324 thousand in 2019 and EUR 609 thousand at December 2018. The increase was due to the activation of researching and development expenses on the Gauss, Nilo and Shoptize projects. These expenses are recorded in the profit and loss account as "Capitalisation of intangible assets" and are activated as intangible fixed assets if they meet the conditions to be specifically itemised by projects, if their cost is clearly established so that it can be distributed over time, and if there are reasonable grounds for the technical success and economic/commercial profitability of the projects in question. These questions are related to the projected revenues based on the "Own technology" line of activity.
- Goodwill: balance of EUR 1,944 thousand in 2019, comprising the goodwill that arose from the reverse merger with Propuesta Digital, S.L., the company holding the shares of Making Science Group, S.A. and that received the transfer of the branch of activity of The Science of Digital, S.L.
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Consolidation goodwill
In 2019, the consolidation goodwill was EUR 2,582 thousand. This balance corresponds to the Group's acquisitions of companies in 2018.
Trade and other receivables | |||
Trade receivables itemised | 2018 | 2019 | |
(thousands of euros) | |||
Commercial debtors and other receivables | 4,791 | 12,968 | |
Trade receivables | 4,356 | 11,879 | |
Group trade receivables | -26 | 301 | |
Sundry debtors | 66 | 6 | |
Employees | 1 | 10 | |
Current tax assets | 372 | 5 | |
Other accounts receivable from public | 23 | 767 | |
authorities | |||
The debtors and other receivables mainly correspond to revenues from sales of media and technology. The total amount was EUR 12,968 thousand in 2019 and EUR 4,791 thousand at December 2018. The significant growth under this heading is mainly due to the increase in billing volume.
Net equity | ||||
Net equity itemised | 2018 | 2019 | ||
(thousands of euros) | ||||
Share capital | 1,282 | -1,038 | ||
Reserves | 5,089 | -655 | ||
Prior years' results | -3,270 | - | ||
Share premiums | - | 2,595 | ||
Official capital subsidies | 38 | 37 | ||
Other shareholder contributions | 240 | |||
Profit/(loss) for the year | -2,399 | 1,269 | ||
Net equity | 739 | 2,448 | ||
The total amount of pro forma consolidated equity was EUR 2,448 thousand in 2019 and EUR 739 thousand at December 2018. The net equity amount consists of the following items:
- Share capital: balance of EUR -1,038 in 2019 and 1,282 thousand in 2018. In 2019, this heading included the capital of MSG, which is affected by the uncalled capital at 31-12-2019 for a sum of 1,153 from the capital increase performed on 31-01-2020.
- Reserves: balance of EUR -655 thousand in 2019 and 5,089 thousand in 2018. This heading mainly includes the reserves of MCentric Ltd. (EUR -2,055 in 2019 and 4,210 thousand in 2018), The Science
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of Digital, S.L. (EUR -1,587 thousand in 2019 and 443 thousand in 2018) and Making Science Group, S.A. (EUR -271 thousand in 2019 and 580 thousand in 2018).
- Official capital subsidies: balance of 38 in 2019 (EUR 38 thousand in 2018) from loans with subsidised interest rates from the Spanish Industrial Technology Development Centre (CDTI).
- Profit/(loss) for the year: balance of EUR 1,270 in 2019 and -2,399 thousand in 2018, corresponding to the net profit/loss on the pro forma consolidated income statement.
Thousands of euros | 2019 | 2018 |
Net Debt | 1,247 | 1,643 |
Cash and cash equivalents | -7,560 | -5,218 |
Current financial investments | -552 | -665 |
Non-current payables | 2,360 | 2,290 |
Non-current payables to group companies and associates | 418 | 1,116 |
Current payables | 6,464 | 2,890 |
Current payables to group companies and associates | 117 | 1,230 |
Recurring EBITDA | 2,505 | 1,616 |
Net Debt/ EBITDA | 0.5x | 1.0x |
Debt
The Group had a net financial debt balance of EUR 1,643 thousand in 2019 and 1,247 thousand in 2018.
The net financial debt mainly consists of:
- Non-currentdebt: balance of EUR 2,360 thousand in 2019 and 2,290 thousand in 2018. These balances include (i) bank debt, with the loan from Banco Santander as the main balance (EUR 1,160 thousand in 2019), (ii) debts to the shareholders of Crepes & Texas and I2TIC from the deferred payment of the purchase of those companies (EUR 485 thousand and EUR 270 in 2019 respectively), and (iii) two loans subsidised by the CDTI for a sum of EUR 573 thousand in 2019.
- Current debt: balances of EUR 6,464 thousand in 2019 and 2,890 thousand in 2018. These balances mainly correspond to (i) debts from supplier and client advances owed to Bankia for a sum of EUR 2,937 thousand in 2019, (ii) current debts on loans from Banco Santander, Banco Sabadell and Bankinter for a total of EUR 633 thousand in 2019, (iii) supplier and client advances owed to Banco Santander for EUR 1,910 thousand in 2019 and (iv) supplier and client advances owed to BBVA for EUR 50 thousand in 2019. Factoring is constantly used for cash needs except for Coca Cola and IFEMA, two clients that are required under contract to do factoring, (v) other current financial liabilities for a sum of EUR 360 thousand in 2019, which mainly correspond to the current part of the
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debts from the deferred payment in the purchase of the companies I2TIC and Crepes & Texas and the current amount of the loan from the CDTI.
- Non-currentpayables to group companies and associates: balances of EUR 418 thousand in 2019 and 1,116 at December 2018, mainly corresponding to a debt to the CEO of MCentric for administrative fees and a debt to the Group's CEO for the deferred payment of the purchase of Making Science Digital Marketing.
- Current payables to group companies and associates: balances of EUR 117 thousand in 2019 and 1,230 thousand in 2018. In 2019, this included the current debt for the deferred payment on the purchase of the company Making Science Digital Marketing from the Group's CEO for a sum of EUR 100 thousand. In 2018, this balance included the convertible debt to the shareholders of MCentric for a sum of EUR 551 thousand, which was fully converted into shares in 2019.
- Cash and cash equivalents: balance of EUR 7,560 thousand in 2019 and 5,218 thousand in 2018.
The conditions for the interest rates and maturities of the Group's loans are summarised in the following table:
Initial | Drawn down | ||||
at December | |||||
limit | |||||
Entity | Start | Maturity | Financial conditions | 2019 | |
(thousan | |||||
(thousands | |||||
ds of €) | |||||
of €) | |||||
EUR 12M + 5%, with | |||||
SMART | June 2019 | December 2025 | 20-month grace | 2,500 | 1,500 |
period | |||||
Bankia | July 2019 | July 2021 | EUR 6M + 1.8% | 900 | 346 |
CDTI | June 2018 | June 2028 | 0.0% | 381 | 330 |
Banco Santander | July 2019 | July 2020 | 1.5% | 350 | 0 |
CDTI | June 2016 | June 2026 | 0.0% | 330 | 246 |
Banco Santander | March 2019 | April 2023 | EUR 6M + 3.2% | 140 | 81 |
Banco Sabadell | April 2019 | April 2020 | 3.1% | 150 | 150 |
Bankinter | June 2018 | June 2021 | 4.0% | 100 | 92 |
Banco Sabadell | May 2019 | May 2020 | 5.7% | 75 | 75 |
Popular | May 2015 | May 2020 | 1.0% | 59 | 6 |
Facility Agreement with Banco Santander through its SMART Fund
On 10 May 2019, the Company signed a facility agreement with Banco Santander through its SMART Fund, for a sum of EUR 2.5 million, with a grace period until 10 December 2020 and that will have 20 quarterly due dates after the grace period until it matures on 10 December 2025.
This facility agreement has various covenants, mainly the following:
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- To keep the Net Financial Debt/EBITDA ratios under 2.0x in 2019, 1.5x in 2020 and 1.0x in 2021.
- To comply with a minimum EBITDA of EUR 1,469 million in 2019, EUR 1,993 million in 2020 and EUR 2,617 million in 2020.
- Dividends may not be paid out in 2019 and 2020, and after that they may only be paid out subject to complying with solvency ratios.
- Annual and quarterly financial reporting obligations and obligations to report on relevant corporate operations.
Trade and other payables | ||||
Trade payables itemised | 2018 | 2019 | ||
(thousands of euros) | ||||
Trade and other payables | 6,106 | 13,178 | ||
Payables to suppliers | 747 | 732 | ||
Payable to suppliers - Group companies and | 89 | |||
associates | 5,767 | |||
Sundry payables | 3,029 | 3,459 | ||
Employees | 97 | 413 | ||
Liabilities from current taxes | 226 | 91 | ||
Other accounts payable to public authorities | 1,918 | 2,708 | ||
Advances from customers | 0 | 7 |
Trade and other payables, with a balance of EUR 13,178 thousand in 2019 (EUR 6,106 thousand at December 2018), mainly consists of sundry payables with a balance of EUR 3,459 thousand (EUR 3,029 thousand in 2018) and other debts with public administrations with a balance of EUR 2,708 thousand in 2019 (EUR 1,918 thousand in 2018).
The increase under payables from provision of services is mainly related to the increased expenditure on jobs performed by other companies and the volume of services the Group contracted in the last period, in addition to reclassifications of balances under suppliers to the payables heading.
Pro forma profit and loss account
The pro forma consolidated profit and loss account for the years closed 31 December 2019 (audited by Grant Thornton in its resolved procedures report), 31 December 2018 (audited by Grant Thornton in its resolved procedures report) and 31 December 2017 (presented merely for comparison without a third-party audit) are presented below.
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2017 | 2018 | 2019 | ||
Thousands of euros | (12 months) | (12 months) | (12 months) | |
Net turnover | 13,473 | 18,840 | 35,531 | |
% growth | 39.8% | 88.6% | ||
Change in inventories | 33 | -33 | - | |
Costs of goods sold | -7,092 | -9,808 | -24,141 | |
Gross profit | 6,414 | 8,999 | 11,390 | |
% growth | 40.3% | 26.6% | ||
Capitalisation of intangible assets | 309 | 277 | 827 | |
Personnel expenses | -3,748 | -5,606 | -7,728 | |
% of gross profit | -58.4% | -62.3% | -67.8% | |
% growth | 49.6% | 37.9% | ||
Other operating expenses | -1,880 | -2,186 | -2,486 | |
% of gross profit | -29.3% | -24.3% | -21.8% | |
% growth | 16.2% | 13.7% | ||
Other operating revenue | 12 | 23 | 168 | |
EBITDA | 1,106 | 1,507 | 2,171 | |
% of gross profit | 17.2% | 16.7% | 19.1% | |
% growth | 36.2% | 44.1% | ||
Impairment and profit/(loss) on property | 10 | -9 | - | |
Other gains or losses | 4 | -3,499 | -9 | |
Amortization of property | -25 | -80 | -542 | |
EBIT | 1,095 | -2,081 | 1,620 | |
Financial results | -3 | -79 | -183 | |
Profit/(loss) before tax | 1,092 | -2,160 | 1,437 | |
Corporate income tax | -174 | -239 | -166 | |
Net profit | 918 | -2,399 | 1,271 | |
% of gross profit | 14.3% | -26.7% | 11.1% | |
Recurring EBITDA | 1,616 | 2,505 | ||
% of gross profit | 18.0% | 22.0% | ||
% growth | 55.0% | |||
Other non-recurrent operating expenses | 108 | 334 |
The Group recorded EUR 35,531 thousand in pro forma consolidated net profit in 2019, which represents an 88.6% increase over 2018.
The gross margin was EUR 11,390 thousand in 2019, which represents a 26.6% increase over 2018.
The Labour costs was EUR 7,728 thousand in 2019, which represents 67.8% of the gross margin and a 37.9% increase over 2018.
The other operating expenses amounted to EUR 2,486 thousand in 2019, which represents 21.8% of the gross margin and a 13.7% increase over 2018.
The Group's EBITDA was EUR 2,171 thousand in 2019, which represents a 44.1% increase over 2018. As a percentage of gross margin, the EBITDA increased from 16.7% in 2018 to 19.1% in 2019. For recurring EBITDA, excluding extraordinary expenses for provisions, impairment and other losses, the Group posted EUR 2,505 thousand in 2019, which represents a 55.0% increase over 2018 and an improvement of 18.0% of gross margin in 2018 to 22.0% of gross margin in 2019.
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For profit/(loss) before tax, the Group recorded EUR 1,437 thousand in profits in 2019, versus EUR 2,160 thousand in losses in 2018 (due to the EUR 3,499 thousand in impairment of the stake in MCentricksd, S.A.).
Net turnover
The Company reported EUR 35,531 thousand in net turnover in 2019 and EUR 18,840 thousand in 2018.
Costs of goods sold and gross margin
For its costs of goods sold, the Group had EUR 24,141 thousand in 2019 and 9,808 thousand in 2018. These figures correspond primarily to the purchase of adtech technology and media (purchases related to the adtech technology and media sales line of activity).
For its gross margin, the Group had EUR 11,390 thousand in 2019 and 8,999 thousand in 2018%, for an increase of 26.6%. The margin with respect to the net turnover went up from 32.1% in 2018 to 47.8% in 2019, due to variations in the relative weight of adtech technology and media in the product mix, as the Group's costs of goods sold are mainly related to this line of activity.
Capitalisation of intangible assets
The 'capitalisation of intangible assets' heading records the capitalisation of expenses incurred on research and development projects. The Group capitalised expenses of EUR 827 thousand in 2019, versus 277 thousand in 2018.
Projects must meet the following conditions to be capitalised or activated:
- The projects and the costs must be duly and clearly specified.
- There must be grounded reasons for the technical success and financial profitability of the projects in question.
The assets must be amortised on a linear basis over their lifespan, which is defined as five years.
The Group had the following main projects activated in 2019: Gauss (for a sum of EUR 191 thousand), Nilo (EUR 324 thousand) and Shoptize (EUR 312 thousand).
Personnel expenses
For personnel expenses, the Group posted EUR 7,728 thousand in 2019 and 5,606 thousand in 2018%, representing an increase of 37.9%. This expenditure level increased from 62.3% of the gross margin in 2018 to 67.8% in 2019. This increase mainly came from new employees who were hired to obtain a sufficient structure to handle future growth.
The personnel expenses came from the following list of salaries and wages, compensation, social Security
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under the Company's responsibility and other social expenses: | ||||
Personnel expenses, itemised | 2018 | 2019 | ||
(thousands of euros) | ||||
Personnel expenses | -5,606 | -7,728 | ||
Wages and salaries | -4,360 | 6,083 | ||
Compensation | -1 | - | ||
Social Security under the Company's | -1,210 | 1,645 | ||
responsibility | ||||
Other employee benefit costs | -35 | - | ||
Other operating expenses
Under operating expenses, the Group posted EUR 2,486 thousand in 2019 and 2,186 thousand in 2018%, representing an increase of 13.7%. This expenditure level increased from 24.3% of the gross margin in 2018 to 21.8% in 2019.
Other operating expenses, itemised | 2018 | 2019 | |
(thousands of euros) | |||
Other consolidated operating expenses | -2,186 | -2,486 | |
Rent payments | -402 | -465 | |
Professional services | -982 | -607 | |
Other expenses | -802 | -1,414 | |
Recurring EBITDA
Recurring EBITDA, excluding extraordinary expenses for provisions, impairment and other non-recurring expenses was EUR 2,505 thousand in 2019 and EUR 1,616 thousand in 2018, which represents an increase of 55.0%. The recurring EBITDA as a percentage of gross margin increased from 18.0% in 2018 to 22.0% in 2019.
Recurring EBITDA | 2018 | 2019 | |
(thousands of euros) | |||
EBITDA | 1,507 | 2,171 | |
% of gross profit | 16.7% | 19.1% | |
Other non-recurrent operating expenses | 108 | 334 | |
(provisions, impairment and other losses) | |||
Recurring EBITDA | 1,616 | 2,505 | |
% of gross profit | 18.0% | 22.0% |
The recurring EBITDA did not include balances of EUR 334 thousand in 2019 and 108 thousand in 2018. This adjustment corresponds to the impairment of client balances over six months old and included under losses on trade credits (EUR 185 thousand in 2019) and the regularisation of other payables and expenses related to the corporate reorganisation (EUR 149 thousand in 2019).
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Other gains or losses
In other gains or losses, the Group posted a EUR 9 thousand loss in 2019, versus a EUR 3,499 thousand loss in 2018. The 2018 loss came from the partial impairment of MCentricksd, S.A.'s shares in its direct parent MCentric Ltd., as the Spanish company has an asset imbalance. Capital increases were conducted in 2019 to rectify this.
1.17.2. Adverse opinions, denials of opinion, qualifications or limitations of scope by the auditors.
The financial information in the consolidated annual financial statements of Making Science Group, S.A. at 31 December 2019, and the individual annual financial statements of Making Science Group, S.A. at 31 December 2018 and 31 December 2019 was audited by Grant Thornton, which issued the corresponding audit reports without reservations and without unfavourable or denied opinions.
1.17.3. Preliminary Non-Audited Accounts and results from 2020.
Below, the following figures are detailed from the consolidated profit/(loss) statement at 30 June 2020, which was not subject to an interim audit or a limited review, or to procedures resolved by the auditor:
June 2019 | June 2020 | 2020e | % June 2020 | ||||||||
(Forecast, | (6m) vs | ||||||||||
(6 months) | (6 months) | ||||||||||
Thousands of euros | 12 months) | 2020e (12m) | |||||||||
Net turnover | 14,276 | 23,229 | 46,750 | 49.7% | |||||||
% growth | 62.7% | ||||||||||
Costs of goods sold | -9,258 | -16,371 | -33,800 | 48.4% | |||||||
Gross profit | 5,018 | 6,858 | 12,950 | 53.0% | |||||||
% growth | 36.7% | ||||||||||
Capitalisation of intangible assets | 373 | 465 | 800 | 58.1% | |||||||
Personnel expenses | -3,567 | -4,381 | -8,509 | 51.5% | |||||||
% of gross profit | -71.1% | -63.9% | -65.7% | ||||||||
% growth | 22.8% | ||||||||||
Other operating expenses | -1,072 | -1,301 | -2,253 | 57.8% | |||||||
% of gross profit | -21.4% | -19.0% | -17.4% | ||||||||
% growth | 21.4% | ||||||||||
Other revenues | 3 | 71 | 0 | n.a. | |||||||
EBITDA | 740 | 1,710 | 2,988 | 57.2% | |||||||
% of gross profit | 14.7% | 24.9% | 23.1% | ||||||||
% growth | 131.1% | ||||||||||
Recurring EBITDA | 1,710 | 3,063 | 55.8% | ||||||||
% of gross profit | 24.9% | 23.7% | |||||||||
% of net turnover | 7.4% | 6.6% | |||||||||
Other non-recurrent operating expenses | 0 | 75 | n.a. |
The Company reported EUR 23,229 thousand in consolidated net turnover in June 2020 (6 months), which represents 49.7% of the 2020 forecast (12 months).
Under gross margin, the Group recorded EUR 6,858 thousand in June 2020 (6 months), which represents
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53.0% of the 2020 forecast (12 months).
Its personnel expenses were EUR 4,381 thousand in June 2020 (6 months), which represents 51.5% of the 2020 forecast (12 months).
The Group recorded EUR 1,301 thousand in other operating expenses in June 2020 (6 months), which represents 57.8% of the 2020 forecast (12 months).
With respect to EBITDA (which is the same as recurrent EBITDA because there are no recurrent expenses), the Group recorded EUR 1,710 thousand in June 2020, which represents an EBITDA margin of 24.9%. In six months, the Company has reached 57.2% of its EBITDA 2020 forecast (12 months).
1.17.4. Cash Position Statement established within three months prior to the scheduled date of first admission to trading.
The Company's Board of Directors declares that, following an analysis with due diligence, the Company has sufficient working capital to conduct its activity over the 12 months following the incorporation of Euronext Growth. In addition to its own positive cash generation in that period, the Company also has positive working capital as of the date of this Information Document, to which the additional debt the Company has the capacity to take on may also be added.
1.17.5. Description of the dividend policy.
The Company wants to strike a balance between growth and shareholder remuneration. Therefore, even though it expects to prioritise reinvestment in growth, it does not rule out paying dividends of up to 30% of Net Profits.
The Company did not pay out dividends in 2020 in compliance with the covenants under its facility agreement with Banco Santander through its SMART Fund. It may begin to pay out dividends in 2021 if it is in compliance with the limitations established by means of solvency ratios.
1.17.6. Information on disputes that may have a significant effect on the Company.
There are no lawsuits that may have a significant effect on the Company.
1.18. Risk Factors.
Making Science's business and activities are predicated on intrinsic factors exclusive to it as described in this Information Document and by certain exogenous factors that are usual in any company in its sector. Therefore, before adopting any decision to invest in the Company's shares, investors should take into
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account not just all of the provided information, but also other factors such as the risks indicated below in this section 1.18. If any of the described risks comes to fruition, the Issuer's business, results and financial and asset situation may be adversely and significantly affected. Investors should also take into account that these risks may have an adverse impact on Making Science's share price, which could lead to a full or partial loss of their investment.
The indicated risks are not the only ones that Making Science may face. There are other risks that, due to being more obvious to the general public, are not discussed in this section. Moreover, future risks yet unknown and not considered to be relevant may have an impact on the business, the results, the perspectives and the financial, economic and asset situation of the Company and its subsidiaries.
Investors should study carefully whether investing in Making Science shares is appropriate for them taking into account their personal circumstances and the information provided in this Information Document. Therefore, potential investors in the Issuer's shares should read this section and the rest of the Document carefully. Potential investors are also recommended to consult with their financial, legal and tax advisers before making any investment.
The order the following risks are presented in does not necessarily reflect the likelihood that the risks may actually materialise, their potential significance, or the scope of the potential harm to the Company's business, results and financial and asset situation.
1.18.1. Operational and valuation risks
Dependence of managers and key personnel
Even though Making Science has a growing organisational structure and management team that reduce its dependence on specific persons, it is managed by a small number of key senior managers (most notably for all purposes, the Company's CEO, José Antonio Martínez), whose loss could have a substantial negative effect on the Company's operations. Making Science's growth and success will depend to a large degree on his ability to bring in, train, retain and incentivise managers, and on each of the areas of the highly qualified organisational structure. A loss of key personnel and an inability to find other qualified personnel could have a substantial adverse impact on the Company's business and results, its financial situation, its assets and its share price.
Risk related to keeping up competitive advantages long term
Making Science's competitive position is based on a series of competitive advantages that, if they are not maintained in the medium- and long-term, may negatively impact the Company's business, and particularly its ability to reach its growth and profitability objectives.
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Risk related to being a leader in Google technology in Spain and the ability to repeat that position in new markets
Making Science's position as one of Spain's top Google technology agencies is a factor that sets it apart in the Spanish market. Making Science is also a reseller of the Google Marketing Platform for the entire EMEA region. If Making Science loses this leading position in the future, this might negatively affect the Company's growth, profits and share price.
Risk of signing up clients
Even though Making Science has a broad and growing portfolio of clients with excellent diversification by sectors, it has a degree of concentration in its five largest clients, who account for 36.6% of its turnover excluding adtech technology and media sales in 2019. (It is excluded because it is a line of activity that barely contributes to gross profits, and nevertheless bear a heavy weight of net turnover, which could cause distortions.) Losing these clients could have a negative impact on the Company's financial situation, assets and share price.
Concentration of activity in Spain
Making Science has a risk because of the high concentration of its activity in Spain, whence 83.7% of its turnover comes aside from advanced technology and media sales (for the reasons noted above) in 2019, and because most of its staff is in Spain, although the Company is in the midst of a geographical expansion that might progressively mitigate this risk in the future. The country undergoing a negative economic climate in the coming years could have a negative impact on the Company's financial situation, assets and share price.
Risk related to geographic expansion
Making Science is undergoing a geographical expansion that presents certain risks when being executed, although the expansion is being initiated with support from strategic alliances with local partners (such as IKI Media in Barcelona, and Karma Network in Lisbon) to mitigate these risks as much as possible. If the Company cannot conduct this geographical expansion as planned in the coming years, this might have a negative impact on the Company's financial situation, assets and share price.
Risk associated with the ability to seal new strategic partnerships and acquire companies
Making Science is the result of the partnership between Make Marketing y Comunicación, S.L. and The Science of Digital, S.L., and the subsequent integration of five other companies. Making Science also plans to continue growing, supported by levers including new strategic partnerships and acquisitions. If the Company cannot implement this strategy of forming strategic partnerships and acquiring companies as planned, this might have a negative impact on the Company's financial situation, assets and share price.
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Risk due to the influence of the majority shareholder
The main shareholder of Making Science holds 78.2% of its shares as of the date of this Information Document, and at the same time he is the CEO and Chair of the Board of Directors, which allows him to exercise a high degree of influence over the Company's decisions.
Conflicts of interest with related parties
The Company has conducted transactions with related parties and may continue to do so in the future in accordance with section 1.16 of this Information Document. If those transactions are not conducted in market conditions favouring the interests of its main shareholders and other related parties, this may negatively affect the Company's financial situation, results and share price.
Risk of possible contribution of an incomplete branch of activity of The Science of Digital, S.L.
The Science of Digital, S.L. transferred its branch of activity to Making Science Group, S.A. (through the instrument company Propuesta Digital, S.L., which was created for this purpose and later merged with Making Science Group, S.A.) from July to September 2019. As of the date of this Information Document, some The Science of Digital, S.L. have yet to complete the formalities to switch suppliers from The Science of Digital, S.L. to Making Science Group, S.A. Therefore, clients are still being invoiced by The Science of Digital, S.L., that are then re-billed to Making Science Group, S.A. There is a possible risk that clients may continue to invoice services furnished by Making Science Group, S.A. to the company The Science of Digital, S.L., even though that company does not provide services. This risk is limited taking into account that The Science of Digital, S.L. does not furnish the services directly and does not have the capacity to furnish them (it does not have any employees of its own). If this risk comes to fruition, it may negatively affect the Company's profits and share price.
Risk of not meeting forecasts
The Company has included its forecasts for 2020. Meeting these forecasts will depend on factors including the materialisation of the hypothesis on revenues and expenses in the forecast (organic growth, etc.). It should be stressed that there is a series of risk factors (detailed in that section) that may substantially affect the Company's ability to meet its forecasts, which could negatively affect its business, profits, financial situation, assets and share price.
Risks of regulatory changes
Making Science is subject to regulations that may be changed in the future. Changes to certain regulations could have a negative impact on the Company's financial situation, assets and share price.
A significant percentage of the Company's revenues come from contracts with durations of one year or less
Most of Making Science's contracts are tacitly renewable, although it also has contracts of two and three years and one-year contracts that normally correspond to projects. If these annual contracts are not renewed or if they are renegotiated for lower amounts, then the Company's financial position, assets and share price could be negatively affected.
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Risk of claims in and out of court
The Company is not currently aware of any claims against it in and out of court due to, inter alias, its activities, its taxes from years open to audit, and the labour situation of its employees. However, any judgments on claims that are negative for the Company's interests could have a negative impact on its business, its profits, its financial situation, its assets and its share price.
Risk linked to the impact of COVID-19
On 11 March 2020, the World Health Organization elevated the public emergency situation caused by the coronavirus outbreak to an international pandemic. One of the measures taken by the Spanish government was to declare a state of alarm, publishing Royal Decree 463/2020 and approving a number of urgent extraordinary measures to cope with the economic and social impact of COVID-19 through Royal Decree- Law 8/2020 of 17 March.
That situation has made a significant impact on the global economy as a result of the interruption or slowdown in the supply chains, the substantial increase in economic uncertainty, and a reduction in liquidity.
Considering the complex nature of the markets as a result of their globalization and the absence, for the time being, of an effective medical treatment, it is complicated to make a reliable estimate of the potential impacts although, to date, there have not been any significant commercial or operational consequences for the Company or its subsidiaries.
The Company directors and managers are constantly assessing the situation to successfully cope with any potential financial and non-financial impacts. Among the formalities carried out by the Company to cope with the situation arising from COVID-19 and minimize the impact of the pandemic, the main ones, among others, are:
- Organising shifts between employees to minimize infection risks.
- Further analysing the risks of customer specially in sector such us hotel and hospitality.
- Additional focus on cashflow and collections.
- Carefully looking to all new hires.
Finally, the liquidity risk arises from the possibility of the Company not being able to have access to liquid funds, or access them in sufficient quantity and at an adequate cost, to meet its payment obligations at all times. To that end, the Company, at the date of this Document, has sufficient working capital and the liquidity risk is insignificant.
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1.18.2. Risks related to the Company's financing and exposure to interest rates
Debt level
According to its 2019 pro forma consolidated financial statements, Making Science has EUR 2.5 million in net financial debt (equivalent to a multiple of 0.5 times its 2019 pro forma consolidated recurring EBITDA). Any breaches in payment of Making Science's financial debt and its other obligations could negative impact its financial situation, profits and valuation.
Risk of potential interest rate increases
Making Science's financial debt is exposed to interest rate risk, which may have an adverse impact on its financial results and cash flows.
Risk associated with financing of possible acquisitions of new companies
If the Company does not obtain the financing it needs to acquire new companies, it may have difficulties reaching its objectives, which could negative impact its business, profits, financial position, assets and share price.
1.18.3. Risks associated with the digital marketing sector
The cyclical nature of the sector
Digital marketing is a cyclical business that is subject to cycles that depend on the economic/financial climate. The budgets advertising companies allocate to digital marketing depend on, in addition to other factors, the economic growth rate, interest rates, inflation, changes in legislation, the geopolitical situation and demographic and social factors. Any changes in these factors might have a negative impact on the Company's financial situation, assets and share price.
Risk of competition
Making Science works in a competitive sector in which specialised Spanish and international companies also operate, although Making Science has a competitive position based on various strengths. If the groups and companies Making Science competes with or new competitor groups and companies arising in the future present a threat to Making Science and reduce its business opportunities, this may negatively affect the Company's business, results, financial situation, assets and share price.
Risk related to the concentration of suppliers in the sector
The digital marketing sector is highly concentrated on giant multi-national technology companies such as Google and Facebook, which have large market shares of global digital advertising revenues. The current level of concentration brings with it the risk that these suppliers could implement changes to their sales policies that might adversely affect Making Science, which could negative impact the Company's business, profits, financial situation, assets and share price.
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Risk related to technological disruption
Digital marketing is an activity that is subject to constant evolution and technological disruption that could present a risk to the Company, due to its need to adapt constantly. If the Company cannot properly adapt to this technological disruption, this might have a negative impact on the Company's financial situation, assets and share price.
Risk related to possible regulatory changes
Digital marketing, and in particular, data analysis, is subject to potential regulatory changes that could present a risk for the Company. This risk coming to fruition could have a negative impact on the Company's financial situation, assets and share price.
Economic slowdowns
Unfavourable economic conditions such as recessions and stalled growth in the markets where Making Science operates could negatively affect the affordability and demand of the services the Company offers. In adverse economic conditions companies may reduce their expenditures on new projects and seek lower- cost alternatives. If this happens, Making Science's revenues could decrease and this would negatively affect the Company's business, profits, financial situation, assets and share price.
1.18.4. Risks related to the shares
Possible dilutions in the future due to corporate operations and employee compensation plans
Making Science may acquire companies in the coming years by paying for them in part or in full by issuing new shares, or it may launch employee compensation plans by issuing new shares, which could have the impact of diluting the Company's shares.
Partial subscription of the capital increase
The proposed capital increase only being partially subscribed could raise investor distrust about the expansion plan, and thus a lack of interest in the value. All of this could push Making Science's share price down.
Risk of lack of liquidity
Since the Company's shares have never been listed on a multilateral trading system, there are no guarantees as to the share purchase volume and liquidity level. Potential investors should take into account that the value of their investment in the Company may go up or down.
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Evolution of the share price
As of the date of this Information Document, securities markets are highly volatile due to the current economic situation, and this may have a negative impact on the Company's share price. Factors such as fluctuations in the Company's profits, changes in analyst recommendations and in the situation of Spanish and international markets, and sales by the Company's main shareholders could have a negative impact on the Company's share price.
Any investors should bear in mind that the value of their investment in the Company may go up or down, and that the listed price of its shares may not reflect the Company's intrinsic value.
Good governance recommendations
Even though they do not apply to the Company because the Alternative Exchange Market is not classified as an official secondary market, as of the date of this Information Document the Company has not implemented all of the recommendations in the Code of Good Governance for listed companies approved by the Spanish Securities and Exchange Commission. This means that some information that may be of interest to potential investors is not provided in the same way and with the same transparency as in companies listed on official secondary markets.
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2. INFORMATION ABOUT THE ISSUER'S SHARES
2.1. Number of shares for which incorporation is requested, their nominal value. Share capital, indication of whether there are other classes or series of shares and whether securities have been issued that give the right to subscribe or acquire shares.
As of the date of this Information Document, Making Science's share capital is EUR 70,623.00, represented by 7,062,300 shares with a par value of EUR 0.01 each. All of the shares are subscribed and paid out in full, and they belong to the same class and series and confer identical political and economic rights on their bearers. No securities have been issued that grant a right to subscribe or acquire shares.
2.2. Distribution of the shares
2.2.1. Approvals related to the incorporation of the shares to Euronext Growth Paris
In its Board meeting held on 2 July 2020, Making Science approved the incorporation of the shares of Euronext Growth Paris through a dual listing process.
2.2.2. Number of shares to be listed
The objective of this Information Document is the incorporation of the Company's shares on Euronext Growth Paris by means of a dual listing process for all of its 7,062,300 shares.
The price of incorporation on Euronext Growth Paris will be set using the stock price on BME Growth at the time of the dual listing of the Company's shares.
2.3. Main characteristics of the shares and their corresponding rights for shareholders. Possible limitations concerning the shareholders meeting attendance, vote and appointment of directors.
The legal regime applicable to the shares being offered is the regime envisaged under Spanish law, and in particular, in the Spanish Corporate Enterprises Act, the Spanish Securities Market Act (Ley del Mercado de Valores), Royal Legislative Decree 21/2017, of 29 December, on urgent measures to adapt European Union securities market rules to Spanish law, Royal Decree 878/2015, of 2 October, on offsetting, settlement and recording of securities represented by book entries, and in any other regulations that may implement, amend and replace them.
The Company's shares are represented by book entries and are registered in the corresponding accounting records kept by Iberclear, with registered address in Madrid, at Plaza Lealtad, 1, 28014, registered in the Commercial Register of Madrid in Volume 15,611, page 5, sheet M-262818, and holder of tax identification number A-82695677.
The shares are denominated in euros. All the shares are ordinary and have the same political and economic rights.
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2.4. Description of any condition for the free transmission of the shares, statutory or extra- statutory.
There are no restrictions in the articles of association on the free transferability of the shares, except for transfers of shares in acquisition offers that would entail a change of control (with this defined as a shareholder acquiring more than 50% of the Company's share capital) that is subject to a condition or restriction compatible with being listed in Euronext Growth, as specified in article 7 of the articles of association.
2.5. Para-social agreements between shareholders or between the Company and its shareholders, that might limit the transmission of shares or affect voting rights.
The Company is not party to any pacts or agreements that limit share transfers and affect their voting rights, and it is also not aware of any shareholders who hav signed any agreements or pacts that regulate those issues.
2.6. Commitment vetting the sale, transmission or new share issuance, assumed by the shareholders or by the Company in the light of admission for trading on Euronext Growth Paris.
The shareholders The Science of Digital, S.L. (owned by Jose Antonio Martínez), Álvaro Verdeja Junco y Bastiat Internet Vetures, S.L. (owned by Jose Antonio Martínez), which hold 71.86%, 8.01% and 2.32% respectively of the Company's share capital at 30 June 2020, have committed to Renta 4 Corporate, S.A. not to pledge, sell or otherwise dispose of or transfer the shares they hold in the Company, and not to directly or indirectly perform any operations that might have a similar effect during the 365 days following the date the shares are incorporated on BME Growth (which occurred on 21 February 2020), without prior written consent from Renta 4 Corporate, S.A. To clarify, this commitment will not apply to any agreements and commitments that the shareholders may assume from this date in relation to possible future sales and transfers of all or part of their shares in Making Science once the abovementioned period has expired.
Furthermore, 11 managers of the Company who hold 1.5% of the share capital at the date of incorporation on BME Growth (21 February 2020) have made the same commitment to Making Science Group, S.A. as the previous shareholders during the 365 days following the incorporation of the Company's shares on BME Growth (which took place on 21 February 2020).
2.7. Description of the statutory provisions required by the regulation of Euronext Growth Paris regarding the obligation to communicate material participations and para-social agreements and the requirements for the exclusion of trading on Euronext Growth Paris and changes in control within the Company.
In its meeting of 15 November 2019, the extraordinary universal general shareholders meeting adopted a resolution to approve a new recast text of the articles of association, in order to adapt them to the specified requirements for listing the shares on a market, which included: (i) the obligation to communicate significant holdings and shareholder agreements; (ii) regulation of the rules on applying for delisting; and (iii) the rules in cases of transfers of Company shares that would result in a change in control.
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The articles that include the relevant provisions in relation to these matters are quoted below:
ARTICLE 7. TRANSFER OF SHARES
The shares can be freely transferred according to the Spanish Capital Companies Act and to the regulations governing the Alternative Equity Market.
Transfers in case of change in control.
Anyone who intends to acquire shares representing more than 50% of the share capital must, at the same time, make a purchase offer addressed to all the shareholders of the Company, under the same terms and conditions.
Likewise, if a shareholder receives an offer from a shareholder or third party to purchase their shares, by virtue of which, as a result of its wording and the circumstances of the acquirer and the other concurrent circumstances, they must reasonably deduce that the purpose is to assign the acquirer shares representing more than 50% of the share capital, then the shareholder in question may only transfer shares that determine that the acquirer exceeds the indicated percentage if the potential acquirer proves that they have offered to purchase the shares of all the shareholders under the same terms and conditions.
Co-ownership, usufruct, pledge and attachment of shares.
The legal system applicable to the co-ownership, usufruct, pledge and attachment of shares will be that established in the Spanish Capital Companies Act.
ARTICLE 7 BIS. REPORTING SIGNIFICANT EQUITY
Shareholders must inform the Company of any acquisition or transfer of shares, by way of any title and directly or indirectly, that establishes that the total scope of their shares exceeds or falls below 10% of the share capital and its subsequent multiples.
If the shareholders are members of the Governing Body of the Company or directors thereof, their reporting obligation shall refer to the percentage of 1% of the share capital and its subsequent multiples.
Notifications shall be sent to the institution or person appointed by the Company to that effect (or to the Secretary of the Governing Body, if no express appointment is made), within a maximum of four (4) business days following the date on which the fact that gives rise to the obligation to issue the notification occurs.
The Company shall make this public in accordance with the provisions of the regulations of the Alternative Equity Market.
ARTICLE 7. TER. REPORTING COVENANTS
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The shareholders must inform the Company of the subscription, modification, extension or termination of any covenant that may restrict the transferability of the shares they own or that may affect the rights to vote inherent to the said shares.
Notifications shall be sent to the institution or person appointed by the Company to that effect (or, where applicable, to the Secretary of the Governing Body, if no express appointment is made), within a maximum of four (4) business days following the date on which the fact that gives rise to the obligation to issue the notification occurs.
The Company shall make these notifications public in accordance with the provisions of the regulations of the Alternative Equity Market.
ARTICLE 7. QUATER. DELISTING SHARES
If the General Meeting reaches an agreement in the Alternative Equity Market to delist shares representing the share capital without the favourable vote of any of the Company's shareholders, the Meeting will have the obligation to offer the shareholders who did not vote in favour of the delisting to acquire their shares at a fair price according to the criteria established in the regulations of public tender offers regarding assets in the assumptions established for delisting.
The Company shall not be subject to the above obligations when it agrees to admit its shares to trading on an official Spanish secondary market simultaneously with their delisting from the Alternative Equity Market.
2.8. Description of the functioning of the General Meeting of Shareholders of the Company.
The General Shareholders Meeting is subject to the Spanish Corporate Enterprises Act and the Company's Articles of Association.
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3. OTHER RELEVANT INFORMATION
3.1. Stock Option plan:
Making Science believes that employees are the Company's greatest asset, and it therefore intends to have all of its employees benefit from the Company's growth. As a general rule, all Company employees may receive stock options so that they may purchase Company shares at a discount from their list price.
On 10 December 2019, the Company approved a stock options plan (the "Stock Options Plan"). To benefit from the Options Plan, employees must remain with the Company for at least one year after signing their personal conditions. The execution periods will generally (but not necessarily) be three or four years, with linear releases or greater weights in the last exercise years.
The Stock Options Plan resulted in the dilution of the initial shares, and the Company has held back 360,000 of its shares in allocation to attract talent and keep them loyal.
Management of the plan and distribution of the options has been delegated to the CEO.
The Company does not discard the possibility of creating other types of incentives aside from stock options, which are necessary to attract talent and keep them loyal, and that are subject to approval by the pertinent bodies of the Company.
The Company intends to keep up to 5% of its shares back on allocation to meet its commitments to pay out shares under the Options Plan. To do this, the relevant bodies of the Company will adopt the necessary resolutions.
3.2. Main features of the stock on BME Growth and Euronext Growth
ISIN code: ES0105463006
Ticker (Euronext Growth): ALMKS
Ticker (BME Growth): MAKS
Number of shares to be listed: 7,062,300
Central Securities Depositary (Euronext Growth): Euroclear France
Central Securities Depositary (BME Growth): Iberclear
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3.3. Share price performance:
Making Science was incorporated on BME Growth on 21 February 2020 at a price of EUR 3.20 per share. It has reached a maximum price of EUR 7.90 and a minimum of EUR 3.22.
The total volume traded as of the date of this Information Document is EUR 2.8 million.
Source:https://www.bmegrowth.es/ing/Ficha/MAKING_SCIENCE_ES0105463006.aspx
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3.4. Market Disclosures:
Below, all of the "Relevant facts", "Other relevant information" and "Privileged information" that Making Science has communicated to BME Growth from its incorporation on 21 February 2020 to the date of this Information Document.
- 12 March 2020: Transactions by managers and closely related parties.https://www.bmegrowth.es/docs/documentos/HechosRelev/2020/03/05463_HRelev_20200312_2.pdf
- 19 March 2020: Expenses incurred for the process of incorporation on the Market.https://www.bmegrowth.es/docs/documentos/HechosRelev/2020/03/05463_HRelev_20200319.pdf
- 29 April 2020: 2019 financial reporting.https://www.bmegrowth.es/docs/documentos/InfFinanciera/2020/04/05463_InfFinan_20200429.pdf
- 30 April 2020: Q1 2020 financial reporting.https://www.bmegrowth.es/docs/documentos/InfFinanciera/2020/04/05463_InfFinan_20200430.pdf
- 5 May 2020: Presentation of 2019 and Q1 2020 results.https://www.bmegrowth.es/docs/documentos/HechosRelev/2020/05/05463_HRelev_20200505_2.pdf
- 12 May 2020: Transactions by managers and closely related parties.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/05/05463_OtraInfRelev_20200 512.pdf
- 22 May 2020: Transactions by managers and closely related parties.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/05/05463_OtraInfRelev_20200 522.pdf
- 22 May 2020: Call of the Ordinary General Shareholders' Meeting.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/05/05463_OtraInfRelev_20200 522_1.pdf
- 26 May 2020: Presentation to be used in the 2020 Medcap Forum.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/05/05463_OtraInfRelev_20200 526.pdf
- 03 June 2020: Transactions by managers and closely related parties.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/06/05463_OtraInfRelev_20200 603.pdf
- 16 June 2020: Transactions by managers and closely related parties.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/06/05463_OtraInfRelev_20200 616.pdf
- 25 June 2020: Transactions by managers and closely related parties.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/06/05463_OtraInfRelev_20200 624.pdf
- 07 July 2020: Significant holdings at 30 June 2020.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/07/05463_OtraInfRelev_20200 707.pdf
- 7 July 2020: Resolutions adopted in the Ordinary General Shareholders' Meeting.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/07/05463_OtraInfRelev_20200 707_1.pdf
- 14 July 2020: Purchase of assets associated with the business of Salesforce de Cloudforms, S.L.
makingscience.com: EURONEXT Growth | 83 |
https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/07/05463_OtraInfRelev_20200 714.pdf
- 21 July 2020: Q2 2020 financial reporting.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/07/05463_OtraInfRelev_20200 721.pdf
- 24 July 2020: Transactions by managers and closely related parties.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/07/05463_OtraInfRelev_20200 724.pdf
- 11 September 2020: Change in the Secretary of the Board of Directors.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/09/05463_OtraInfRelev_20200 911.pdf
- 15 October 2020: Acquisition of Omniaweb Italia, S.R.L.https://www.bmegrowth.es/docs/documentos/OtraInfRelevante/2020/10/05463_OtraInfRelev_20201 015_1.pdf?2PkvJw!!
makingscience.com: EURONEXT Growth | 84 |
4. LISTING SPONSOR AND OTHER EXPERTS OR ADVISORS
Making Science designed Renta 4 Corporate, S.A. as a Listing Sponsor to lead the dual-listing on Euronext Growth.
Renta 4 Corporate, S.A. belongs to Renta 4 Banco, S.A., which was incorporated as Renta 4 Terrasa, S.A. by public deed executed on 16 May 2001, indefinitely, and is currently registered at the Madrid Commercial Registry in volume 21,918, page 11, section B, sheet M-390614, with tax identification number A62585849, and with registered address at Paseo de la Habana 74, Madrid. On 21 June 2005, it changed its company name to Renta 4 Planificación Empresarial, S.A., and once again changed its name on 1 June 2007 to its current name.
No other advisors concur in the dual-listing process or in the preparation of this Information Document.
makingscience.com: EURONEXT Growth | 85 |
Appendix I. Pro forma consolidated financial statements as of 31 December 2019 and as of 31 December 2018 (and agreed-upon procedures report issued on 28 Abril 2020)
makingscience.com: EURONEXT Growth | 86 |
(SWORN TRANSLATION FROM SPANISH TO ENGLISH) (TRADUCCIÓN JURADA DEL ESPAÑOL AL INGLÉS)
Making Science Group, S.A.
Agreed-Upon Procedures Report
(SWORN TRANSLATION FROM SPANISH TO ENGLISH) (TRADUCCIÓN JURADA DEL ESPAÑOL AL INGLÉS)
[Logo: Grant Thornton]
Grant Thornton
Paseo de la Castellana, 81 28046 Madrid
T. +34 91 576 39 99
F. +34 91 577 48 32 www.GrantThornton.es
Agreed-Upon Procedures Report
To the Board of Directors of Making Science Group, S.A.:
In line with our Agreed-Upon Procedures Proposal dated on 17 March 2020, we have carried out the Procedures Agreed upon with You, which are described below, regarding certain pro forma consolidated financial information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019. The pro forma consolidated information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. is attached in the schedule titled: 'Pro forma consolidated financial information as of 31 December 2019' (Schedule 1), as well as the explanatory notes about concept definitions prepared by the Parent Company, according to their interpretation of the companies making up the consolidation perimeter (Schedule 2). The Board of Directors of the Parent Company is responsible for the preparation and contents of the documents included in Schedules 1 and 2. All money amounts reflected in such calculations are expressed in Euro, as of 31 December 2019.
The Board of Directors of Making Science Group, S.A. is responsible for interpreting the contents of the pro forma consolidated financial information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019 contained in the Schedule 2 appended, which has been the basis for the calculation, preparation and content of the document identified as Schedule 1, which is also the responsibility of the Board of Directors of Making Science Group, S.A.
Our work does not include any assessment on whether the criteria applied to obtain the pro forma consolidated financial information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019, contained in Schedule 1 and prepared in line with the definitions, assumptions and interpretations of the Board of Directors of Making Science Group, S.A., are appropriate or not for the purposes sought by the users of this report.
Our work on some agreed-upon procedures regarding certain pro forma consolidated financial information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019, as well as the explanatory notes relating to definitions and interpretations prepared by the Company (Schedule 2), has been carried out following generally accepted professional standards in Spain applicable to Agreed-Upon Procedures assignments based on the international standard ISRS 4400, which regulates the auditor activity in this kind of assignments. In the case of Agreed-Upon Procedures work, it is the reader of the report who draws their own conclusions in the light of the objective findings reported. Likewise, the recipient of the report is responsible for the adequacy of the procedures carried out for the desired purposes. Therefore, we assume no responsibility regarding the adequacy of the procedures used.
Member of Grant Thornton International Ltd
Barcelona Bilbao Castellón - Madrid Málaga - Murcia Pamplona • Valencia Vigo Zaragoza
Grant Thornton, S.L.P. (Sociedad Unipersonal) Paseo de la Castellana, 81,11*- 28046 Madrid, Spanish Tax Code B-08914830, filed in the Companies Registry of Madrid, Volume 36.652. Folio 159, Page M-657.409, entry 36, and filed in the Spanish Official Register of Auditors (ROAC) under number S0231
(SWORN TRANSLATION FROM SPANISH TO ENGLISH) (TRADUCCIÓN JURADA DEL ESPAÑOL AL INGLÉS)
[Logo: Grant Thornton]
1. SCOPE OF OUR WORK AND PROCEDURES USED
After receiving the pro forma consolidated financial information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019, as well as the documents defining concepts, assumptions and scenarios prepared by the Board of Directors of the Parent Company (attached as Schedule 2 of this report), the procedures carried out were:
- Questions to the Company's key personnel about the criteria applied and the specific procedures used to prepare the pro forma consolidated financial information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019.
- Verifying the fact that the amounts included in every line item of the pro forma consolidated financial information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019, with regard to each of the companies included in the pro forma financial information of Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019 for each company match the amounts reflected in the sums and balances of each of such companies.
- Verifying the mathematical accuracy of the different aggregations made by the Parent Company management in connection with the pro forma consolidated financial information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019.
- Checking the fact that the companies included in the preparation of the pro forma consolidated financial information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019 match the information provided by the Parent Company management.
- Obtaining a representation letter by the Managing Director of the Parent Company stating the Parent Company's responsibility in respect of the preparation, adequacy, completeness and accuracy of any information provided to us, as well as the Parent Company's responsibility with regard to the adequacy of the procedures carried out to achieve the desired purposes.
2. FINDINGS OF OUR WORK
There is no matter to be reviewed arising from the implemented procedures described above.
As an Agreed-Upon Procedures work is not an audit of the attached information, we do not express an audit opinion thereon, or provide any guarantee for such information taken as a whole. If we had carried out additional procedures on the aforementioned information, we would have been able to express other facts or statements and inform you about them.
2
(SWORN TRANSLATION FROM SPANISH TO ENGLISH) (TRADUCCIÓN JURADA DEL ESPAÑOL AL INGLÉS)
[Logo: Grant Thornton]
This report is intended to be used only by the Board of Directors of Making Science Group, S.A., and cannot be used for any other purpose or distributed to third parties other than the Parent Company without our prior approval. We accept no liability against third parties other than the recipients of this report.
As the procedures described above are not an audit or a review carried out under Technical Auditing Standards for the implementation thereof in Spain (NIA-ES), we do not express an audit opinion on the pro forma consolidated financial information on Making Science Group, S.A. and subsidiaries + The Science of Digital, S.L. as of 31 December 2019. If we had carried out additional procedures on the aforementioned information, we would have been able to express other facts or statements and inform you about them.
Grant Thornton S.L.P., Sociedad Unipersonal
ÍÑIGO MARTÍNEZ | ÍÑIGO MARTÍNEZ | This report corresponds |
to the distinctive seal | ||
ARAMENDI | ARAMENDI | |
DE LOYOLA | DE LOYOLA | No. 01/20/00934 |
16064696R | 16064696R | |
Íñigo Martínez Aramendi | 2020-04-28 09:54:33 | issued by the Spanish |
Institute of Chartered | ||
Accountants | ||
28 April 2020 | ||
3
(SWORN TRANSLATION FROM SPANISH TO ENGLISH) (TRADUCCIÓN JURADA DEL ESPAÑOL AL INGLÉS)
SCHEDULE 1
(SWORN TRANSLATION FROM SPANISH TO ENGLISH) (TRADUCCIÓN JURADA DEL ESPAÑOL AL INGLÉS)
Balance sheet MAKING SCIENCE 2019 | ||||||||||||||||||||||||||||||||
Probability | TOTAL | Investment vs. | TOTAL | Goodwill | TOTAL | |||||||||||||||||||||||||||
[Logo: making science] | TSOD | MSG | MSDM | C&T | i2TIC | MSL | MC Subcon. | CONSOLIDATED | ||||||||||||||||||||||||
Domain | AGGREGATE | Equity | amortisation | CONSOLIDATED | ||||||||||||||||||||||||||||
WIT | H ELIMINATIO | NS | ||||||||||||||||||||||||||||||
A) NON-CURRENT ASSETS | 1,166,208 | 7,097,902 | - | 45,602 | 465,801 | - | 142,975 | 423 | 8,918,911 | (1,750,658) | 7,148,699 | (258,172) | 6,890,527 | |||||||||||||||||||
I. Intangible fixed assets | 236,562 | 2,441,994 | - | 786 | 446,096 | - | 142,975 | - | 3,268,412 | 2,581,721 | 5,850,133 | (258,172) | 5,591,961 | |||||||||||||||||||
1. Development | - | 497,764 | - | - | 433,240 | - | 142,975 | - | 1,073,979 | - | 1,073,979 | - | 1,073,979 | |||||||||||||||||||
2. | Concessions | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
3. Patents, licences, brands and other similar items | - | - | - | 786 | - | - | - | - | 786 | - | 786 | - | 786 | |||||||||||||||||||
4. Goodwill | - | 1,944,229 | - | - | - | - | - | - | 1,944,229 | 2,581,721 | 4,525,950 | (258,172) | 4,267,778 | |||||||||||||||||||
5. IT software applications | - | - | - | - | 12,856 | - | - | - | 12,856 | - | 12,856 | - | 12,856 | |||||||||||||||||||
6. Research | 236,562 | - | - | - | - | - | - | - | 236,562 | - | 236,562 | - | 236,562 | |||||||||||||||||||
7. | Other intangible fixed assets | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
II. Tangible fixed assets | - | 249,863 | - | 29,483 | 11,883 | - | - | - | 291,229 | - | 291,229 | - | 291,229 | |||||||||||||||||||
1. Land and buildings | - | 155,411 | - | - | - | - | - | - | 155,411 | - | 155,411 | - | 155,411 | |||||||||||||||||||
2. Technical facilities and other tangible fixed assets | - | 94,452 | - | 29,483 | 11,883 | - | - | - | 135,818 | - | 135,818 | - | 135,818 | |||||||||||||||||||
3. | In-progress tangible assets and advances | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
III. Investments in fixed assets | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
1. | Land | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
2. | Buildings | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
IV. Investments in intra-group companies and associates | 919,647 | 4,332,379 | - | - | - | - | - | 423 | 5,252,449 | (4,332,379) | 920,070 | - | 920,070 | |||||||||||||||||||
1. Equity instruments | 919,647 | 4,332,379 | - | - | - | - | - | - | 5,252,026 | (4,332,379) | 919,647 | - | 919,647 | |||||||||||||||||||
2. | Loans to companies | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
3. | Debt securities | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
4. | Derivatives | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
5. | Other financial assets | - | - | - | - | - | - | - | 423 | 423 | - | 423 | - | 423 | ||||||||||||||||||
6. | Other investments | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
V. Long-term financial investments | 10,000 | 73,666 | - | 15,333 | 7,822 | - | - | - | 106,821 | - | 87,267 | - | 87,267 | |||||||||||||||||||
1. Equity instruments | 10,000 | - | - | - | - | - | - | - | 10,000 | - | 10,000 | - | 10,000 | |||||||||||||||||||
2. | Loans to third parties | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
3. | Debt securities | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
4. | Derivatives | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
5. Other financial assets | - | 73,666 | - | 15,333 | 7,822 | - | - | - | 96,821 | - | 77,267 | - | 77,267 | |||||||||||||||||||
6. | Other investments | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
B) CURRENT ASSETS | 9,412,803 | 16,231,332 | 9,801,968 | 765,803 | 1,002,843 | 172,933 | 1,415,339 | 667,708 | 39,470,729 | - | 21,126,308 | - | 21,126,308 | |||||||||||||||||||
II. Inventories | - | 1,000 | - | 2,340 | - | - | 2,995 | - | 6,335 | - | 6,335 | - | 6,335 | |||||||||||||||||||
6. Advances to suppliers | - | 1,000 | - | 2,340 | - | - | 2,995 | - | 6,335 | - | 6,335 | - | 6,335 | |||||||||||||||||||
III. Trade debtors and other accounts receivable | 7,463,595 | 12,661,686 | 2,753,653 | 725,590 | 835,576 | 159,164 | 1,095,097 | 396,774 | 26,091,134 | - | 12,968,329 | - | 12,968,329 | |||||||||||||||||||
1. Trade receivables for sales and services | 1,685,796 | 6,783,281 | 1,755,818 | 118,532 | 431,055 | 116,980 | 671,431 | 316,113 | 11,879,006 | - | 11,879,006 | - | 11,879,006 | |||||||||||||||||||
a) Trade receivables for sales and services | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
b) Trade receivables for sales and services | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
2. Receivables, intra-group companies and associates | 5,402,285 | 5,822,094 | 997,721 | 555,549 | 397,771 | 40,024 | 127,378 | 80,661 | 13,423,484 | - | 300,679 | - | 300,679 | |||||||||||||||||||
3. Miscellaneous debtors | - | 6,019 | - | - | - | - | - | - | 6,019 | - | 6,019 | - | 6,019 | |||||||||||||||||||
4. | Staff | - | 10,276 | - | - | - | - | - | - | 10,276 | - | 10,276 | - | 10,276 | ||||||||||||||||||
5. Current tax assets | - | 1,010 | 1,763 | 2,014 | - | - | - | - | 4,786 | - | 4,786 | - | 4,786 | |||||||||||||||||||
6. Other loans to Public Bodies | 375,514 | 39,006 | (1,648) | 49,495 | 6,749 | 2,159 | 296,287 | - | 767,563 | - | 767,563 | - | 767,563 | |||||||||||||||||||
7. | Shareholders (partners) for called-up share capital | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
IV. Short-term investments in intra-group companies & associates | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
1. Equity instruments | 881,459 | 1,317,631 | 2,961,472 | - | 41,102 | - | 843 | - | 5,202,507 | - | (19,110) | - | (19,110) | |||||||||||||||||||
2. | Loans to companies | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
3. Debt securities | 881,459 | 1,317,631 | 2,961,472 | - | 41,102 | - | 843 | - | 5,202,507 | - | (19,110) | - | (19,110) | |||||||||||||||||||
4. | Derivatives | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
5. | Other financial assets | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
6. | Other investments | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
V. Short-term financial investments | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
1. Equity instruments | 60,000 | 250,094 | 131,493 | 7,469 | 324 | - | 102,278 | - | 551,658 | - | 551,658 | - | 551,658 | |||||||||||||||||||
2. Loans to companies | 60,000 | - | - | - | - | - | 81,606 | - | 141,606 | - | 141,606 | - | 141,606 | |||||||||||||||||||
3. | Debt securities | - | 3,731 | - | 2,543 | - | - | - | - | 6,275 | - | 6,275 | - | 6,275 | ||||||||||||||||||
4. | Derivatives | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
5. | Other financial assets | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
6. Other investments | - | 246,363 | 131,493 | 4,926 | 324 | - | 20,672 | - | 403,777 | - | 403,777 | - | 403,777 | |||||||||||||||||||
VI. Short-term accruals | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
VII. Cash and other cash equivalents | - | 50,853 | 900 | 4,853 | 478 | - | 1,864 | - | 58,949 | - | 58,949 | - | 58,949 | |||||||||||||||||||
1. Liquid capital | 1,007,750 | 1,950,068 | 3,954,450 | 25,551 | 125,364 | 13,769 | 212,262 | 270,934 | 7,560,146 | - | 7,560,146 | - | 7,560,146 | |||||||||||||||||||
2. Other cash equivalents | 1,007,750 | 1,950,068 | 3,954,450 | 25,551 | 125,364 | 13,769 | 212,262 | 270,934 | 7,560,146 | - | 7,560,146 | - | 7,560,146 | |||||||||||||||||||
TOTAL ASSETS (A + B) | 10,579,011 | 23,329,234 | 9,801,968 | 811,405 | 1,468,644 | 172,933 | 1,558,314 | 668,131 | 48,389,640 | (1,750,658) | 28,275,007 | (258,172) | 28,016,835 | |||||||||||||||||||
A) EQUITY | 2,043,970 | 1,862,721 | 347,944 | 11,714 | 566,067 | 34,678 | (425,707) | 16,027 | 4,457,414 | (1,750,658) | 2,706,756 | (258,172) | 2,448,584 | |||||||||||||||||||
A-1) Equity | 2,006,373 | 1,862,721 | 347,944 | 11,714 | 566,067 | 34,678 | (425,707) | 16,027 | 4,419,816 | (1,750,658) | 2,669,158 | (258,172) | 2,410,986 | |||||||||||||||||||
I. Capital | 44,348 | (1,082,527) | 3,000 | 3,330 | 4,000 | 33,000 | 26,851 | 3,000 | (964,997) | (73,181) | (1,038,178) | - | (1,038,178) | |||||||||||||||||||
1. Authorised share capital | 44,348 | 70,623 | 3,000 | 3,330 | 4,000 | 33,000 | 26,851 | 3,000 | 188,152 | (73,181) | 114,971 | - | 114,971 | |||||||||||||||||||
2. | (Uncalled capital) | - | (1,153,150) | - | - | - | - | - | - | (1,153,150) | - | (1,153,150) | - | (1,153,150) | ||||||||||||||||||
II. Share premium | - | 2,595,947 | - | - | - | - | 8,101,906 | - | 10,697,853 | (8,101,906) | 2,595,947 | - | 2,595,947 | |||||||||||||||||||
III. Reserves | 1,587,014 | (271,444) | 268,248 | 90,233 | 117,468 | - | (2,055,377) | 2,500 | (261,359) | (478,448) | (739,807) | - | (739,807) | |||||||||||||||||||
1. Legal and statutory reserves | 8,700 | 8,000 | 600 | 666 | 800 | - | - | - | 18,766 | (4,566) | 14,200 | - | 14,200 | |||||||||||||||||||
2. Other reserves | 1,578,314 | (279,444) | 267,648 | 89,567 | 116,668 | - | (2,055,377) | 2,500 | (280,125) | (473,882) | (754,007) | - | (754,007) | |||||||||||||||||||
Shares in own equity | - | (3,365) | - | - | - | - | - | - | (3,365) | - | (3,365) | - | (3,365) | |||||||||||||||||||
V. Profit (loss) for previous years | - | - | - | - | - | (8,582) | (6,811,153) | 2,529 | (6,817,206) | 6,817,206 | - | - | - | |||||||||||||||||||
1. | Profit/loss carry-over | - | - | - | - | - | - | (6,811,153) | 2,529 | (6,808,624) | 6,808,624 | - | - | - | ||||||||||||||||||
2. | (Loss from previous financial years) | - | - | - | - | - | (8,582) | - | - | (8,582) | 8,582 | - | - | - | ||||||||||||||||||
VI. Other contributions from partners | - | 240,500 | - | - | - | - | - | - | 240,500 | - | 240,500 | - | 240,500 | |||||||||||||||||||
VII. Profit (loss) for the financial year | 375,011 | 383,610 | 76,696 | (81,849) | 444,599 | 10,260 | 312,066 | 7,998 | 1,528,391 | - | 1,528,390 | (258,172) | 1,270,218 | |||||||||||||||||||
External partners | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
Consolidation reserves | - | - | - | - | - | - | - | - | - | 85,672 | 85,672 | - | 85,672 | |||||||||||||||||||
A-3) Grants, donations and bequests received | 37,598 | - | - | - | - | - | - | - | 37,598 | - | 37,598 | - | 37,598 | |||||||||||||||||||
B) NON-CURRENT LIABILITIES | 330,825 | 2,087,671 | - | - | - | - | 435,145 | 1,819 | 2,855,460 | - | 2,835,906 | - | 2,835,906 | |||||||||||||||||||
I. Long-term provisions | - | - | - | - | - | - | - | 1,819 | 1,819 | - | 1,819 | - | 1,819 | |||||||||||||||||||
1. | Long-term debentures | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
2. | Environmental actions | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
3. | Provisions for restructuring | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
4. | Other provisions | - | - | - | - | - | - | - | 1,819 | 1,819 | - | 1,819 | - | 1,819 | ||||||||||||||||||
II. Long-term debts | 330,825 | 2,031,653 | - | - | - | - | 17,489 | - | 2,379,967 | - | 2,379,967 | - | 2,360,412 | |||||||||||||||||||
1. | Debentures and other marketable securities | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
2. Debts to credit institutions | - | 1,587,657 | - | - | - | - | 17,489 | - | 1,605,146 | - | 1,605,146 | - | 1,605,146 | |||||||||||||||||||
3. | Creditors for financial leasing | - | 8,691 | - | - | - | - | - | - | 8,691 | - | 8,691 | - | 8,691 | ||||||||||||||||||
4. | Derivatives | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
5. | Other financial liabilities | 330,825 | 435,304 | - | - | - | - | - | - | 766,129 | - | 746,575 | - | 746,575 | ||||||||||||||||||
III. Long-term debts to intra-group companies and associates | - | - | - | - | - | - | 417,656 | - | 417,656 | - | 417,656 | - | 417,656 | |||||||||||||||||||
IV. Deferred tax liabilities | - | 56,019 | - | - | - | - | - | - | 56,019 | - | 56,019 | - | 56,019 | |||||||||||||||||||
V. Short-term accruals | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
VI. Non-current trade creditors | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
VII. Long-term debts with special characteristics | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
C) CURRENT LIABILITIES | 8,204,216 | 19,378,841 | 9,454,024 | 799,692 | 902,577 | 138,255 | 1,548,877 | 650,285 | 41,076,766 | - | 22,732,345 | - | 22,732,345 | |||||||||||||||||||
I. Liabilities related to non-current assets | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
II. Short-term provisions | - | - | - | 2,204 | - | - | - | - | 2,204 | - | 2,204 | - | 2,204 | |||||||||||||||||||
III. Short-term debts | 2,156,243 | 3,124,566 | 558,403 | 122,570 | 79,926 | - | 422,455 | - | 6,464,163 | - | 6,464,163 | - | 6,464,163 | |||||||||||||||||||
1. | Debentures and other marketable securities | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||
2. Debts to credit institutions | 2,146,989 | 2,299,470 | 559,795 | 115,450 | 80,338 | - | 178,101 | - | 5,380,143 | - | 5,380,143 | - | 5,380,143 | |||||||||||||||||||
3. | Creditors for financial leasing | - | 11,300 | - | - | - | - | - | - | 11,300 | - | 11,300 | - | 11,300 | ||||||||||||||||||
4. | Derivates | - | - | - | - | - | - | - | - | - | - | - | - | - | ||||||||||||||||||
5. Other financial liabilities | 9,254 | 813,797 | (1,392) | 7,120 | (412) | 244,354 | - | 1,072,720 | - | 1,072,720 | - | 1,072,720 | ||||||||||||||||||||
IV. Short-term debts to intra-group companies and associates | 572,285 | 3,572,782 | 304,698 | 463,062 | 363,374 | 25,383 | 80 | - | 5,301,664 | - | 117,406 | - | 117,406 | |||||||||||||||||||
V. Trade creditors and other accounts payable | 5,475,688 | 11,878,347 | 6,455,294 | 200,263 | 459,277 | 112,872 | 1,126,342 | 650,285 | 26,358,368 | - | 13,198,205 | - | 13,198,205 | |||||||||||||||||||
1. Suppliers | 16 | 214,783 | 753 | - | - | - | 3,750 | - | 219,302 | - | 219,302 | - | 219,302 | |||||||||||||||||||
a) Long-term suppliers | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
b) Short-term suppliers | - | - | - | - | - | - | 40,286 | 18,039 | 58,325 | - | 58,325 | - | 58,325 | |||||||||||||||||||
2. Suppliers, intra-group companies and associates | (288,260) | 6,995,912 | 5,520,476 | 32,045 | 92,947 | 81,495 | 471,761 | 609,461 | 13,515,836 | - | 157,383 | - | 157,383 | |||||||||||||||||||
3. Miscellaneous creditors | 5,566,013 | 3,051,973 | 36,761 | 13,791 | 22,958 | 3,594 | 448,271 | - | 9,143,362 | - | 9,341,652 | - | 9,341,652 | |||||||||||||||||||
4. Staff (outstanding payments) | 6,941 | 146,939 | 112,315 | 36,137 | 64,828 | 3,658 | 49,657 | - | 420,475 | - | 420,475 | - | 420,475 | |||||||||||||||||||
5. Current tax liabilities | 52,873 | - | - | (31) | 60,496 | 3,420 | 30,324 | - | 147,082 | - | 147,082 | - | 147,082 | |||||||||||||||||||
6. Other debts to Public Bodies | 138,105 | 1,468,741 | 777,702 | 118,321 | 218,048 | 20,705 | 82,293 | 22,785 | 2,846,701 | - | 2,846,701 | - | 2,846,701 | |||||||||||||||||||
7. Customer prepayments | - | - | 7,286 | - | - | - | - | - | 7,286 | - | 7,286 | - | 7,286 | |||||||||||||||||||
VI. Short-term accruals | - | 803,146 | 2,135,629 | 11,593 | - | - | - | - | 2,950,368 | - | 2,950,368 | - | 2,950,368 | |||||||||||||||||||
VII. Short-term debts with special characteristics | - | - | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||
TOTAL EQUITY AND LIABILITIES (A + B + C) | 10,579,011 | 23,329,234 | 9,801,968 | 811,406 | 1,468,644 | 172,933 | 1,558,314 | 668,131 | 48,389,640 | (1,750,658) | 28,275,007 | (258,172) | 28,016,835 |
[Seal: Making Science Group, S.A. C/ López de Hoyos 135, 3ª planta 28002 Madrid
A-82861428]
[Signature]
(SWORN TRANSLATION FROM SPANISH TO ENGLISH) (TRADUCCIÓN JURADA DEL ESPAÑOL AL INGLÉS)
[Seal: Making Science Group, S.A. C/ López de Hoyos 135, 3ª planta 28002 Madrid
A-82861428]
[Signature]
MAKING SCIENCE GROUP | Consolidated adjustment | ||||||||||||
TOTAL | |||||||||||||
CONSOLIDATED | |||||||||||||
Profit and Loss MAKING SCIENCE 2019 | Probability | TOTAL | WITH | Goodwill | TOTAL | ||||||||
[Logo: making science] | TSOD | MSG | MSDM | C&T | ¡2TIC | MSL | MC | Domain | AGGREGATE | ELIMINATIONS | amortisation | CONSOLIDATED | |
RECURRING EBITDA | 2,504,501 |
Non-recurring expenses | 10,816 | 157,530 | 4,068 | 7,690 |
EBITDA | 546,602 | 636,717 | 116,531 | (65,891) |
1. Net turnover | 26,886,509 | 25,158,873 | 10,356,457 | 1,241,737 |
a) Sales | - | - | - | - |
b) Provision of services | 26,886,509 | 25,158,873 | 10,356,457 | 1,241,737 |
2. Changes in inventories of finished goods and work in progress | - | - | - | - |
3. Work carried out by the company for its assets | - | 435,019 | - | - |
4. Procurements | (24,911,261) | (21,795,235) | (8,386,427) | (196,112) |
a) Consumption of merchandise | - | (60,000) | - | (2,305) |
b) Consumption of raw materials and other consumables | - | (14) | - | (4,991) |
c) Work carried out by other companies | (24,911,261) | (21,735,221) | (8,386,427) | (188,816) |
d) Impairment of merchandise, raw materials and other consumables | - | - | - | - |
5. Other operating income | 560,875 | 1,110,057 | 50,455 | 120,433 |
a) Sundry and other operating income | 560,875 | 1,110,057 | 50,455 | 120,075 |
b) Operating grants included in income for the financial year | - | - | - | 358 |
6. Staff expenses | (924,452) | (2,165,948) | (1,524,857) | (913,085) |
a) Wages, salaries and similar expenses | (745,872) | (1,692,652) | (1,188,108) | (701,079) |
b) Social Security Contributions | (178,580) | (473,296) | (336,749) | (212,006) |
c) Provisions | - | - | - | - |
7. Other operating expenses | (1,065,069) | (2,103,283) | (379,096) | (261,913) |
a) External services | (1,062,179) | (2,013,842) | (379,096) | (261,913) |
b) Taxes | (2,890) | (10,559) | - | - |
c) Losses, impairment and changes in provisions for trading activities | - | (78,882) | - | - |
d) Other operating expenses | - | - | - | - |
8. Depreciation of fixed assets | (70,237) | (135,079) | (17,492) | (10,573) |
9. Allocation of grants for non-financial fixed assets and others | - | - | - | - |
10. Provision surpluses | - | - | - | - |
11. Impairment and profit (loss) from disposals of fixed assets | - | - | - | (49,262) |
a) Impairment and losses | - | - | - | - |
- | - | |||
b) Profit/loss from disposals and other | - | (49,262) | ||
- | - | |||
12. Negative differences from business combinations | - | - | ||
13. Other profit/loss | - | (2,766) | - | (7,690) |
A.1) OPERATING PROFIT (LOSS) (1 + 2 + 3 + 4 + 5 + 6 + 7 + 8 + 9 + 10 + 11 + 12 + 13) | 476,364 | 501,638 | 99,039 | (76,464) |
14. Financial income | 2,140 | 5,273 | 12,292 | (10) |
a) From shares in equity | - | - | - | - |
a 1) In intra-group companies and associates | - | - | - | - |
a 2) In third parties | - | - | - | - |
b) From marketable securities and other financial instruments | 2,140 | 5,273 | 12,292 | (10) |
b 1) In intra-group companies and associates | 2,019 | 5,273 | 9,479 | - |
b 2) In third parties | 121 | - | 2,813 | (10) |
c) Allocation of financial grants, donations and bequests | - | - | - | - |
15. Financial expenses | (42,069) | (107,038) | (9,070) | (5,372) |
a) For debts to intra-group companies and associates | (2,888) | (11,388) | (1,935) | (1,529) |
b) For debts to third parties | (4,007) | (92,338) | (6,176) | (3,843) |
c) For adjustment of provisions | (35,174) | (3,313) | (959) | - |
16. Changes of fair value in financial instruments | - | - | - | (2) |
a) Trading book and others | - | - | - | (2) |
b) Allocation to the profit (loss) of the financial year for financial assets available for sale | - | - | - | - |
17. Exchange rate differences | (7,852)- | (990) | - | (1) |
18. Impairment and profit (loss) from disposals of financial instruments | - | - | - | - |
a) Impairment and losses | - | - | - | - |
b) Profit (loss) from disposals and others | - | - | - | - |
32,668 | 6,336 | 123,500 | - | 342,607 | 342,607 | ||
533,112 | 13,777 | 372,268 | 8,778 | 2,161,895 | 2,161,895 | ||
1,841,021 | 145,678 | 1,794,595 | 438,933 | 67,863,802 | 35,531,346 | , | 35,531,346 |
- | - | 380,000 | 438,933 | 818,933 | 818,933 | - | 818,933 |
1,841,021 | 145,678 | 1,414,595 | - | 67,044,869 | 34,712,413 | - | 34,712,413 |
- | - | - | - | - | - | - | - |
440,775 | - | - | - | 875,794 | 826,532 | - | 826,532 |
(154,725) | (31,774) | (113,177) | (476,635) | (56,065,346) | (24,140,969) | - | (24,140,969) |
110 | - | (74,242) | (476,635) | (613,072) | (595,175) | - | (595,175) |
- | - | - | - | (5,005) | (5,005) | - | (5,005) |
(154,835) | (31,774) | (38,936) | - | (55,447,270) | (23,540,788) | - | (23,540,788) |
- | - | - | - | - | - | - | |
61,156 | 19,253 | 68,650 | 76,155 | 2,067,034 | 168,071 | - | 168,071 |
61,156 | 19,253 | 68,650 | 76,155 | 2,066,676 | 167,713 | - | 167,713 |
- | - | - | - | 358 | 358 | - | 358 |
(1,362,072) | (71,618) | (738,666) | (27,502) | (7,728,201) | (7,728,201) | - | (7,728,201) |
(1,104,038) | (45,326) | (578,825) | (27,502) | (6,083,402) | (6,083,402) | - | (6,083,402) |
(258,034) | (26,292) | (159,841) | - | (1,644,799) | (1,644,799) | - | (1,644,799) |
- | - | - | - | - | - | - | |
(293,636) | (41,426) | (639,133) | - | (4,783,555) | (2,485,812) | - | (2,485,812) |
(260,316) | (41,426) | (465,759) | - | (4,484,530) | (2,186,788) | - | (2,186,788) |
(60) | - | (80,404) | - | (93,913) | (93,913) | - | (93,913) |
(33,260) | - | (88,384) | - | (200,526) | (200,526) | - | (200,526) |
- | - | (4,587) | - | (4,587) | (4,587) | (4,587) | |
(13,367) | - | (37,374) | - | (284,123) | (284,123) | (258,172) | (542,295) |
- | - | - | - | - | - | - | |
- | - | - | - | - | - | - | - |
- | - | - | - | (49,262) | - | - | - |
- | - | - | - | - | - | - | - |
- | - | - | |||||
- | - | - | (49,262) | - | |||
- | - | - | |||||
- | - | - | - | - | |||
592 | (6,336) | - | (2,173) | (18,373) | (9,074) | (9,074) | |
519,745 | 13,777 | 334,895 | 8,778 | 1,877,772 | 1,877,772 | (258,172) | 1,619,600 |
571 | - | 520 | - | 20,787 | 3,564 | - | 3,564 |
6 | - | - | - | 6 | 6 | - | 6 |
- | - | - | - | - | - | ||
6 | - | - | - | 6 | 6 | - | 6 |
565 | - | 520 | - | 20,780 | 3,557 | - | 3,557 |
452 | - | - | - | 17,223 | (0) | - | (0) |
113 | - | 520 | - | 3,558 | 3,558 | - | 3,558 |
- | - | - | - | - | - | - | - |
(7,465) | (97) | (47,805) | - | (218,915) | (201,692) | - | (201,692) |
(1,194) | (97) | (80) | - | (19,111) | (1,888) | - | (1,888) |
(6,271) | - | (4,623) | - | (117,258) | (117,258) | - | (117,258) |
- | - | (43,101) | - | (82,547) | (82,547) | - | (82,547) |
- | - | (5,042) | - | (5,044) | (5,044) | - | (5,044) |
- | - | (5,042) | - | (5,044) | (5,044) | - | (5,044) |
- | - | - | - | - | - | - | - |
(579) | - | 29,497 | - | 20,075 | 20,075 | - | 20,075 |
- | - | - | - | - | - | - | - |
- | - | - | - | - | - | - | - |
- | - | - | - | - | - | - | - |
A.2) FINANCIAL PROFIT (LOSS) (14 + 15 + 16 + 17 + 18) | (47,781) | (102,755) | 3,223 | (5,385) | (7,473) | (97) | (22,829) | - | (183,097) | (183,097) | (183,097) | |
A.3) PROFIT (LOSS) BEFORE TAXES (A.1 + A.2) | 428,583 | 398,883 | 102,261 | (81,849) | 512,272 | 13,680 | 312,066 | 8,778 | 1,694,675 | 1,694,675 | (258,172) | 1,436,503 |
19. Income tax | (53,573) | (15,273) | (25,565) | - | (67,673) | (3,420) | - | (780) | (166,284) | (166,284) | (166,284) | |
A.4) PROFIT (LOSS) FOR THE FINANCIAL YEAR FROM CONTINUING OPERATIONS (A.3 + 19) | 375,011 | 383,610 | 76,696 | (81,849) | 444,599 | 10,260 | 312,066 | 7,998 | 1,528,390 | 1,528,390 | (258,172) | 1,270,218 |
B) INTERRUPTED OPERATIONS | - | - | - | - | - | |||||||
20. Profit (loss) for the financial year from interrupted operations net of taxes........ | ||||||||||||
A.5) PROFIT (LOSS) FOR THE FINANCIAL YEAR (A.4 + 20) | 375,011 | 383,610 | 76,696 | (81,849) | 444,599 | 10,260 | 312,066 | 7,998 | 1,528,390 | 1,528,390 | (258,172) | 1,270,218 |
(SWORN TRANSLATION FROM SPANISH TO ENGLISH) (TRADUCCIÓN JURADA DEL ESPAÑOL AL INGLÉS)
[Signature]
MAKING SCIENCE GROUP AS OF 31.12.2018
Making | Probability | MCentric ltd | Investment - | Group balance | ||||||||||||
MAKE | AIA | i2TIC | C&T | Science | Domain | TSOD | consolidated | Aggregate | Equity | elimination | Consolidated | |||||
ASSETS | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | ||||
31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | |||||
NON-CURRENT ASSETS | 3,293,253 | 17,492 | 21,896 | 105,437 | - | 250 | 3,269,510 | 181,349 | 6,889,188 | (480,697) | (250) | 6,408,491 | ||||
I | Intangible fixed assets | 75,000 | - | - | 49,862 | - | - | 305,232 | 178,621 | 608,715 | - | - | 608,715 | |||
1. | Development | 75,000 | - | 49,076 | - | 178,621 | 302,697 | 302,697 | ||||||||
2. | Concessions | - | - | - | - | - | - | |||||||||
3. | Patents, licences, brands and other similar items | 786 | - | - | 786 | 786 | ||||||||||
4. | Goodwill | - | - | - | ||||||||||||
5. | IT software applications | - | - | - | - | - | ||||||||||
6. | Research | - | 305,232 | - | 305,232 | - | - | 305,232 | ||||||||
7. | Other intangible fixed assets | - | - | - | - | - | - | |||||||||
II | Tangible fixed assets | 89,833 | 17,492 | 14,074 | 40,243 | - | - | 12,656 | 1,728 | 176,026 | - | - | 176,026 | |||
1. | Land and buildings | - | - | - | ||||||||||||
2. | Technical facilities and other tangible fixed assets | 89,833 | 17,492 | 14,074 | 40,243 | - | 12,656 | 1,728 | 176,026 | 176,026 | ||||||
3. | In-progress tangible assets and advances | - | - | - | - | |||||||||||
III | Investments in fixed assets | - | - | - | - | - | - | - | - | - | - | - | ||||
1. | Land | - | - | - | - | - | - | |||||||||
2. | Buildings | - | - | - | - | - | - | |||||||||
IV | Long-term investments in intra-group companies and | |||||||||||||||
associates | 3,071,000 | - | - | - | - | 250 | 2,932,341 | - | 6,003,591 | (3,071,000) | (250) | 2,932,591 | ||||
1. | Equity instruments | 3,071,000 | - | 2,932,341 | - | 6,003,311 | (3,071,000) | - | 2,932,341 | |||||||
2. | Loans to companies | - | - | - | - | |||||||||||
3. | Debt securities | - | - | - | - | - | - | |||||||||
4. | Derivatives | - | - | - | - | - | - | |||||||||
5. | Other financial assets | 250 | - | 250 | - | (250) | 250 | |||||||||
6. | Other investments | - | - | - | - | - | - | |||||||||
Shareholding in companies consolidated by equity method | - | - | - | |||||||||||||
Long-term financial investments | 57,420 | - | 7,822 | 15,333 | - | - | 19,282 | 1,000 | 100,856 | - | - | 100,856 | ||||
1. | Equity instruments | - | - | - | 10,000 | 0 | 10,000 | - | - | 10,000 | ||||||
2. | Loans to third parties | (1,246) | - | 0 | (1,246) | - | - | (1,246) | ||||||||
3. | Debt securities | - | 0 | - | - | |||||||||||
4. | Derivatives | - | 0 | - | - | - | - | |||||||||
5. | Other financial assets | 58,666 | 7,822 | 15,333 | - | 9,282 | 1,000 | 92,102 | 92,102 | |||||||
6. | Other investments | - | 0 | - | - | |||||||||||
Deferred tax assets | - | - | - | |||||||||||||
Consolidated goodwill | - | 2,590,303 | 2,590,303 | |||||||||||||
- | ||||||||||||||||
CURRENT ASSETS | 2,177,361 | 4,879,323 | 507,913 | 299,835 | 7,921 | 220,888 | 5,784,643 | 1,707,822 | 15,585,106 | - | (4,700,455) | 10,782,793 | ||||
- | ||||||||||||||||
I | Inventories | - | 90,000 | - | - | - | - | 24,585 | - | 114,585 | - | - | 114,585 | |||
6. | Advances to suppliers | 90,000 | - | 24,585 | 0 | 114,585 | 114,585 | |||||||||
II | Trade debtors and other accounts receivable | 1,901,551 | 698,659 | 313,090 | 272,463 | 747 | 142,504 | 3,856,521 | 1,390,609 | 8,576,143 | - | (3,689,306) | 4,791,937 | |||
1. | Trade receivables for sales and services | 1,727,598 | 520,453 | 75,333 | 119,812 | 135,905 | 1,638,093 | 1,020,501 | 5,237,696 | (813,033) | 4,355,526 | |||||
2. | Receivables, intra-group companies and associates | 106,687 | 163,660 | 237,757 | 150,636 | 2,217,532 | - | 2,876,272 | (2,876,272) | (25,765) | ||||||
3. | Miscellaneous debtors | 66,019 | - | - | 66,019 | 66,019 | ||||||||||
4. | Staff | 1,246 | - | 1,246 | 1,246 | |||||||||||
5. | Current tax assets | 1,763 | - | 2,014 | 368,157 | 371,933 | 371,933 | |||||||||
6. | Other loans to Public Bodies | - | 12,783 | (0) | 1 | 747 | 6,599 | 896 | 1,950 | 22,977 | 22,977 | |||||
7. | Shareholders (partners) for called-up share capital | - | - | |||||||||||||
IV | Short-term investments in intra-group companies and | - | ||||||||||||||
associates | - | - | 68,499 | 19,747 | - | - | 922,904 | - | 1,011,150 | - | (1,011,150) | (6,958) | ||||
1. | Equity instruments | - | - | - | - | |||||||||||
2. | Loans to companies | 68,499 | 19,747 | 922,904 | 0.00 | 1,011,150 | (1,011,150) | (6,958) | ||||||||
V. | Short-term financial investments | 5,790 | 110,287 | 192 | 7,366 | - | 8,695 | 314,943 | 217,361 | 664,634 | - | - | 664,634 | |||
1. | Equity instruments | 192 | - | 60,000 | 217,361 | 277,553 | 277,553 | |||||||||
2. | Loans to companies | 2,476 | - | 2,476 | 2,476 | |||||||||||
3. | Debt securities | - | - | - | ||||||||||||
4. | Derivatives | - | - | - | ||||||||||||
5. | Other financial assets | 5,790 | 110,287 | 4,890 | 8,695 | 254,943 | - | 384,605 | 384,605 | |||||||
6. | Other investments | - | - | - | - | |||||||||||
Short-term accruals | - | 478 | - | 478 | 478 | |||||||||||
Cash and other cash equivalents | 270,021 | 3,980,377 | 125,654 | 259 | 6,574 | 69,689 | 665,689 | 99,853 | 5,218,116 | - | - | 5,218,116 | ||||
1. | Liquid capital | 270,021 | 3,980,377 | 125,654 | 259 | 6,574 | 69,689 | 665,689 | 99,853 | 5,218,116 | 5,218,116 | |||||
2. | Other cash equivalents | - | - | - | ||||||||||||
TOTAL ASSETS | 5,470,614 | 4,896,815 | 529,809 | 405,272 | 7,321 | 221,138 | 9,054,153 | 1,889,171 | 22,474,294 | (480,697) | (4,700,705) | 17,191,284 | ||||
EQUITY AND LIABILITIES | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | Balance as of | ||||
31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | 31.12.2018 | |||||
EQUITY | 861,008 | 271,248 | 121,468 | 93,563 | (5,582) | 8,029 | 1,416,852 | (1,530,784) | 1,235,802 | (480,697) | - | 739,070 | ||||
Equity | 861,008 | 271,248 | 121,468 | 93,563 | (5,582) | 8,029 | 1,416,852 | (1,530,784) | 1,235,802 | (480,697) | - | 739,070 | ||||
I. | Capital | 39,820 | 3,000 | 4,000 | 3,330 | 3,000 | 3,000 | 43,500 | 1,195,397 | 1,295,047 | (13,330) | - | 1,281,717 | |||
1. Authorised share capital | 40,000 | 3,000 | 4,000 | 3,330 | 3,000 | 3,000 | 43,500 | 4,329,167 | 4,428,997 | (13,330) | 4,415,667 | |||||
2. (Uncalled capital) | (180) | - | (3,133,270) | (3,133,950) | - | - | (3,133,950) | |||||||||
II. | Issue premium | 7,776,191 | 7,776,191 | 7,776,191 | ||||||||||||
III. | Reserves | 579,657 | 229,749 | 116,335 | 33,069 | - | 2,500 | 442,602 | (3,566,515) | (2,162,603) | (524,265) | - | (2,686,869) | |||
1. Legal and statutory reserves | 2,405 | 600 | 800 | 666 | 2,500 | 8,700 | (2,251,473) | (2,235,802) | (2,066) | (2,237,868) | ||||||
2. Other reserves | 577,252 | 229,149 | 115,535 | 32,403 | 433,902 | (1,315,042) | 73,199 | (522,199) | - | (449,000) | ||||||
IV. | Reserves in Consolidated Companies | - | - | - | ||||||||||||
(Shares in own equity) | - | - | ||||||||||||||
V. | Profit (loss) for previous years | - | - | - | 8,888 | (5,787) | 26,307 | - | (3,296,790) | (3,267,382) | (3,101) | - | (3,270,484) | |||
1. Profit/loss carry-over | 8,888 | 26,307 | 35,195 | (8,888) | 26,307 | |||||||||||
2. (Loss from previous financial years) | (5,787) | (3,296,790) | (3,302,577) | 5,787 | (3,296,790) | |||||||||||
VI. | Other contributions from partners | - | - | |||||||||||||
VII. | Profit (loss) of the parent company for the financial year | 241,532 | 38,499 | 61,133 | 48,276 | (2,795) | (29,777) | 893,152 | (3,639,068) | (2,383,049) | (2,809,084) | |||||
VIII. | (Interim dividends) | (60,000) | (60,000) | 60,000 | - | |||||||||||
Grants, donations and bequests | 37,598 | 37,598 | - | 37,508 | ||||||||||||
Valuation adjustments | - | - | - | - | - | - | - | - | - | - | - | - | ||||
Financial assets available for sale | - | - | - | |||||||||||||
II. | Hedging transactions | - | - | - | ||||||||||||
III. | Non-current assets and related liabilities held for sale | - | - | - | ||||||||||||
IV. | Exchange rate differences | - | - | - | ||||||||||||
External members | - | - | - | |||||||||||||
- | ||||||||||||||||
NON-CURRENT LIABILITIES | 1,818,524 | - | - | - | - | 884,592 | 743,540 | 3,446,656 | - | - | 3,446,656 | |||||
- | ||||||||||||||||
I. | Long-term provisions | - | - | |||||||||||||
Other provisions | - | - | ||||||||||||||
II. | Long-term debts | 1,091,561 | - | - | - | - | 872,059 | 325,885 | 2,289,504 | - | - | 2,289,504 | ||||
1. Debentures and other marketable securities | - | - | - | |||||||||||||
2. Debts to credit institutions | - | 824,404 | 83,333 | 907,737 | 907,737 | |||||||||||
3. Creditors for financial leasing contracts | 19,991 | - | 19,991 | 19,991 | ||||||||||||
4. Derivatives | - | - | - | |||||||||||||
5. Other financial liabilities | 1,071,570 | - | - | - | 47,655 | 242,552 | 1,361,777 | 1,361,777 | ||||||||
III. | Long-term debts to intra-group companies and associates | 698,750 | - | 417,656 | 1,116,406 | - | 1,116,406 | |||||||||
IV. | Deferred tax liabilities | 28,214 | - | 12,533 | - | 40,746 | 40,745 | |||||||||
- | ||||||||||||||||
CURRENT LIABILITIES | 2,791,081 | 4,625,567 | 408,341 | 311,709 | 12,903 | 213,109 | 6,752,709 | 2,676,415 | 17,791,835 | - | (4,660,816) | 13,005,557 | ||||
I. | Liabilities related to non-current assets held for sale | - | ||||||||||||||
II. | Short-term provisions | 117,179 | 2,200 | 119,379 | (86,049) | 33,330 | ||||||||||
Short-term provisions | - | - | ||||||||||||||
III. | Short-term debts | 653,619 | 2,707 | 102,050 | 80,551 | - | 7,126 | 1,465,025 | 579,049 | 2,890,127 | - | - | 2,890,127 | |||
1. Debentures and other marketable securities | - | - | - | - | - | |||||||||||
1. Debts to credit institutions | 147,351 | 1,630 | 18,462 | 73,431 | - | 1,454,499 | 47,341 | 1,742,714 | 1,742,714 | |||||||
2. Creditors for financial leasing contracts | (3,731) | (3,731) | (3,731) | |||||||||||||
Derivates | - | - | - | - | ||||||||||||
3. Other financial liabilities | 510,000 | 1,077 | 83,568 | 7,120 | - | 7,126 | 10,526 | 531,708 | 1,151,145 | 1,151,145 | ||||||
IV. | Short-term debts to intra-group companies and associates | 910,017 | 380,503 | 89,341 | 94,776 | 803,832 | 2,278,469 | (1,024,637) | 1,229,638 | |||||||
V. | Trade creditors and other accounts payable | 1,074,266 | 1,742,357 | 216,951 | 228,958 | 12,903 | 205,983 | 4,982,908 | 1,293,534 | 9,757,859 | - | (3,550,129) | 6,106,463 | |||
1. Suppliers | - | 94,385 | - | 193,562 | 803,414 | - | 1,096,362 | (349,287) | 747,075 | |||||||
2. Suppliers, intra-group companies and associates | 463,438 | 1,700,638 | 33,375 | 3,106 | 6,000 | 170,764 | 366,609 | 2,743,919 | (2,553,388) | 89,294 | ||||||
3. Miscellaneous creditors | 253,114 | 22,426 | 56,428 | 5,182 | 6,761 | 2,561,247 | 771,241 | 3,676,401 | (617,455) | 3,028,947 | ||||||
4. Staff (outstanding payments) | 20,328 | (874) | 7,675 | - | - | 69,638 | 96,768 | 96,768 | ||||||||
5. Current tax liabilities | 16,045 | - | 16,872 | 15,931 | - | 104,079 | 73,432 | 226,363 | 226,363 | |||||||
6. Other debts to Public Bodies | 321,341 | 20,167 | 102,601 | 110,352 | 139 | 12,421 | 1,338,381 | 12,613 | 1,918,017 | 1,918,017 | ||||||
7. Customer prepayments | - | - | - | |||||||||||||
VI. | Short-term accruals | 36,000 | 2,500,000 | - | 210,000 | - | 2,746,000 | - | - | 2,746,000 | ||||||
VII. | Short-term debts with special characteristics | - | - | - | - | - | - | |||||||||
TOTAL EQUITY AND LIABILITIES | 5,470,613,92 | 4,895,815 | 529,809 | 405,272 | 7,321 | 221,138 | 9,054,153 | 1,889,171 | 22,474,293 | (480,697) | (4,660,816) | 17,191,283 | ||||
(SWORN TRANSLATION FROM SPANISH TO ENGLISH) (TRADUCCIÓN JURADA DEL ESPAÑOL AL INGLÉS)
[Signature]
MAKING SCIENCE GROUP AS OF 31.12.2018
Making | Probability | MCentric ltd | Adjustments/ | Group transactions | Consolidated with | ||||||||
MAKE | AIA | i2TIC | C&T | Science | TSOD | Domain | consolidated | Aggregate | Reclassifications | elimination | adjustments | ||
(Debit)Credit | (Debit)Credit | (Debit)Credit | (Debit)Credit | (Debit)Credit | (Debit)Credit | (Debit)Credit | (Debit)Credit | (Debit)Credit | (Debit)Credit | (Debit)Credit | |||
2018 | 2018 | 2018 | 2018 | 2018 | 2018 | 2018 | 2018 | 2018 | 2018 | 2018 | 2018 | ||
A) CONTINUING OPERATIONS: | |||||||||||||
Net turnover | 4,521,872 | 8,183,557 | 1,135,296 | 1,270,894 | 0 | 13,553,006 | 370,060 | 1,233,783 | 30,268,469 | 0 | -11,412,445 | 18,839,988 | |
a) Sales | 4,521,872 | 8,183,557 | 1,135,296 | 13,553,006 | 370,060 | 1,233,783 | 28,997,575 | -10,979,146 | 18,018,429 | ||||
b) Provision of services | 1,270,894 | 0 | 1,270,894 | -433,299 | 821,560 | ||||||||
Changes in inventories of finished goods and work in | -33,155 | 0 | 0 | 0 | 0 | 0 | 0 | -33,155 | 0 | -33,155 | |||
progress | 0 | ||||||||||||
Work carried out by the company for its assets | 75,000 | 0 | 0 | 49,076 | 0 | 153,115 | 0 | 0 | 277,190 | 0 | 0 | 277,190 | |
Procurements | -1,674,032 | -7,862,399 | -156,556 | -233,277 | 5,280 | -10,844,721 | -350,304 | -104,885 | -21,220,893 | 0 | 11,412,445 | -9,808,448 | |
Consumption of merchandise | 0 | 0 | 0 | ||||||||||
Consumption of raw materials and other consumables | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||
Work carried out by other companies | -1,674,032 | -7,862,399 | -156,556 | -233,277 | 5,280 | -10,844,721 | -350,304 | -104,885 | -21,220,893 | 11,412,445 | -9,808,448 | ||
d) Impairment of merchandise, raw materials and other supplies | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
Other operating income | 199,186 | 0 | 4,416 | 1,425 | -8,075 | 2,119 | 1,387 | 0 | 200,458 | 0 | 0 | 23,102 | |
Sundry and other operating income | 199,186 | 4,416 | 1,425 | -8,075 | 2,119 | 1,387 | 0 | 200,458 | 23,102 | ||||
Operating grants included in income for the financial year | 0 | 0 | |||||||||||
Staff expenses | -2,147,896 | -227,751 | -621,693 | -566,829 | 0 | -1,310,769 | -29,098 | -702,087 | -5,606,124 | 0 | 0 | -5,606,124 | |
Wages, salaries and similar expenses | -1,694,498 | -174,423 | -480,651 | -425,229 | -1,028,990 | -29,098 | -528,463 | -4,361,353 | -4,361,353 | ||||
Social Security contributions | -453,398 | -53,328 | -141,043 | -141,600 | -281,778 | -173,624 | -1,244,771 | -1,244,771 | |||||
c) Provisions | 0 | 0 | 0 | ||||||||||
Other operating expenses | -619,631 | -33,598 | -266,200 | -438,784 | 0 | -469,436 | -15,823 | -519,528 | -2,353,000 | 0 | 0 | -2,185,643 | |
External services | -618,821 | -30,229 | -214,221 | -426,845 | -460,895 | -15,553 | -514,943 | -2,281,506 | -2,104,150 | ||||
Taxes | -2,172 | 0 | -60 | -3,122 | -8,540 | -270 | -4,335 | -18,500 | -18,500 | ||||
Losses, impairment and changes in provisions for trading activities | 1,363 | -3,369 | -51,919 | -8,817 | 0 | -62,743 | -62,743 | ||||||
Other operating expenses | -250 | -250 | -250 | ||||||||||
Depreciation of fixed assets | -17,258 | -3,520 | -3,725 | -13,470 | -40,940 | -847 | -79,761 | -79,761 | |||||
Impairment and profit (loss) from disposal of fixed assets | 1,200 | 0 | -10,000 | 0 | 0 | 0 | 0 | 0 | -8,800 | 0 | 0 | -8,800 | |
a) Impairment and losses | 0 | 0 | 0 | ||||||||||
b) Income from disposals and others | 1,200 | -10,000 | 0 | -8,800 | 0 | -8,800 | |||||||
Other profit (loss) | 144 | -1,313 | -3,845 | -3,494,070 | -3,499,083 | -3,499,083 | |||||||
OPERATING PROFIT (LOSS) | 305,430 | 56,289 | 81,538 | 67,721 | -2,795 | 1,038,529 | -23,777 | -3,587,634 | -2,064,698 | 0 | 0 | -2,080,733 | |
Financial income | 1,804 | 497 | 354 | 0 | 0 | 19,847 | 0 | 6,265 | 28,767 | 0 | 0 | 28,767 | |
From shares in equity instruments | 0 | 0 | 0 | 0 | 0 | 19,799 | 0 | 6,265 | 26,064 | 0 | 26,064 | ||
a) In intra-group companies and associates | 0 | 0 | 0 | 19,799 | 0 | 0 | 19,799 | 0 | 19,799 | ||||
b) | In third parties | 0 | 0 | 0 | 0 | 6,265 | 6,265 | 0 | 6,265 | ||||
From marketable securities and other financial instruments | 1,804 | 497 | 354 | 0 | 0 | 48 | 0 | 0 | 2,703 | 0 | 2,703 | ||
a) In intra-group companies and associates | 0 | 0 | 0 | ||||||||||
b) | In third parties | 1,804 | 497 | 354 | 48 | 0 | 2,703 | 2,703 | |||||
Financial expenses | -3,075 | -4,616 | -1,854 | -2,313 | 0 | -35,879 | 0 | -24,348 | -72,085 | 0 | 0 | -72,085 | |
a) For debts to intra-group companies and associates | -1,840 | -24,348 | -26,189 | -26,189 | |||||||||
b) For debts to third parties | -3,075 | -4,616 | -14 | -2,313 | -35,879 | 0 | -45,896 | 0 | -45,896 | ||||
Exchange rate differences | -13 | -1,752 | 10,690 | 8,926 | 8,926 | ||||||||
Impairment and income from disposal of financial instruments | 0 | -839 | 0 | 0 | 0 | 0 | 0 | -44,041 | -44,879 | 0 | 0 | -44,879 | |
Impairment and losses | -839 | 0 | 0 | 0 | 0 | -44,041 | -44,879 | 0 | -44,879 | ||||
FINANCIAL PROFIT (LOSS) | -1,271 | -4,957 | -1,513 | -2,313 | 0 | -17,784 | 0 | -51,434 | -79,271 | 0 | 0 | -79,271 | |
PROFIT (LOSS) BEFORE TAX | 304,160 | 51,332 | 80,025 | 65,408 | -2,795 | 1,020,745 | -23,777 | -3,639,068 | -2,143,969 | 0 | 0 | -2,160,005 | |
Income tax | -62,628 | -12,833 | -18,892 | -17,133 | -127,593 | 0 | -239,079 | -239,079 | |||||
PROFIT (LOSS) FOR THE FINANCIAL YEAR FROM CONTINUING | 0 | ||||||||||||
OPERATIONS | 241,532 | 38,499 | 61,133 | 48,276 | -2,795 | 893,152 | -23,777 | -3,639,068 | -2,383,049 | 0 | 0 | -2,399,084 | |
B) INTERRUPTED OPERATIONS | |||||||||||||
Profit (loss) for the financial year from interrupted operations | |||||||||||||
PROFIT (LOSS) FOR THE FINANCIAL YEAR | 241,532 | 38,499 | 61,133 | 48,276 | -2,795 | 893,152 | -23,777 | -3,639,068 | -2,383,049 | 0 | -2,399,084 |
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Making Science Group SA published this content on 16 October 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 16 October 2020 12:49:03 UTC