Prosegur Cash, S.A.

CASH

ES0105229001

Business Support Services

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Feb. 29	Transcript : Prosegur Cash, S.A., 2023 Earnings Call, Feb 29, 2024
Feb. 28	Prosegur Cash, S.A. Reports Earnings Results for the Full Year Ended December 31, 2023	CI

Prosegur Cash S A : Individual Annual Accounts 2019

September 24, 2020 at 03:45 am EDT

Prosegur Cash, S.A.

Annual Accounts

31 December 2019

Directors' Report 2019

(With Independent Auditor's Report Thereon)

(Free translation from the original in Spanish. In the event of discrepancy, the Spanish-language version prevails.)

KPMG Auditores, S.L. Pº de la Castellana, 259C 28046 Madrid

Independent Auditor's Report on the Annual Accounts

(Translation from the original in Spanish. In the event of discrepancy, the Spanish-language version prevails.)

To the shareholders of Prosegur Cash, S.A.

REPORT ON THE ANNUAL ACCOUNTS

Opinion __________________________________________________________________

We have audited the annual accounts of Prosegur Cash, S.A. (the "Company"), which comprise the balance sheet at 31 December 2019, and the income statement, statement of changes in equity and statement of cash flows for the year then ended, and notes.

In our opinion, the accompanying annual accounts give a true and fair view, in all material respects, of the equity and financial position of the Company at 31 December 2019, and of its financial performance and its cash flows for the year then ended in accordance with the applicable financial reporting framework (specified in note 2 to the accompanying annual accounts) and, in particular, with the accounting principles and criteria set forth therein.

Basis for Opinion _________________________________________________________

We conducted our audit in accordance with prevailing legislation regulating the audit of accounts in Spain. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Annual Accounts section of our report.

We are independent of the Company in accordance with the ethical requirements, including those regarding independence, that are relevant to our audit of the annual accounts in Spain pursuant to the legislation regulating the audit of accounts. We have not provided any non-audit services, nor have any situations or circumstances arisen which, under the aforementioned regulations, have affected the required independence such that this has been compromised.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

KPMG Auditores S.L., sociedad española de responsabilidad limitada y firma miembro de la red KPMG de firmas independientes afiliadas a KPMG International Cooperative ("KPMG International"), sociedad suiza.

Paseo de la Castellana, 259C - Torre de Cristal - 28046 Madrid

Inscrita en el Registro Oficial de Auditores de Cuentas con el nº.S0702, y en el Registro de Sociedades del Instituto de Censores Jurados de Cuentas con el nº.10. Reg. Mer Madrid, T. 11.961, F. 90, Sec. 8, H. M -188.007, Inscrip. 9

N.I.F. B-78510153

Key Audit Matters ________________________________________________________

Key audit matters are those matters that, in our professional judgement, were of most significance in the audit of the annual accounts of the current period. These matters were addressed in the context of our audit of the annual accounts as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Recoverable amount of investments in Group companies

See notes 9 and 25.4

Key audit matter	How the matter was addressed in our audit

The Company has investments in Group companies amounting to Euros 1,170 million. In 2019 the Company did not recognise any impairment of investments in Group companies.

There is a risk that the carrying amount of the investments in Group companies may exceed their recoverable amount.

As required under the applicable financial reporting framework, the Company annually assesses whether there are indications of impairment of the investments in Group companies and estimates the recoverable amount at the reporting date of the entities which present indications of impairment.

The recoverable amount of the entities that present indications of impairment was determined based on their fair value.

To estimate this fair value, the Company used valuation techniques that require the Directors to exercise judgement and make assumptions and estimates.

Due to the uncertainty associated with these estimates and the significance of the carrying amount of the investments in Group companies, this has been considered a key audit matter of the current period.

Our audit procedures included the following:

Assessing the design and implementation of the controls associated with the process of identifying indications of impairment and estimating the recoverable amount of investments in Group companies.
Analysing the indications of impairment of the investments in Group companies identified by the Company.
Assessing the reasonableness of the estimation of fair value of companies presenting indications of impairment, using valuation techniques and with the assistance of our valuation specialists.
Evaluating whether the information disclosed in the annual accounts meets the requirements of the financial reporting framework applicable to the Company.

Other Information: Directors' Report _______________________________________

Other information solely comprises the 2019 Directors' Report, the preparation of which is the responsibility of the Company's Directors and which does not form an integral part of the annual accounts.

Our audit opinion on the annual accounts does not encompass the directors' report. Our responsibility as regards the content of the directors' report is defined in the legislation regulating the audit of accounts, which establishes two different levels:

A specific level applicable to certain information included in the Annual Corporate Governance Report, as defined in article 35.2. b) of Audit Law 22/2015, which consists solely of verifying that the aforementioned information has been provided in the directors' report, and if not, to report on this matter.
A general level applicable to the rest of the information included in the directors' report, which consists of assessing and reporting on the consistency of this information with the annual accounts, based on knowledge of the entity obtained during the audit of the aforementioned accounts and without including any information other than that obtained as evidence during the audit. Also, assessing and reporting on whether the content and presentation of this part of the directors' report are in accordance with applicable legislation. If, based on the work we have performed, we conclude that there are material misstatements, we are required to report them.

Based on the work carried out, as described above, we have verified that the information mentioned in section a) above has been provided in the directors' report, that the rest of the information contained in the directors' report is consistent with that disclosed in the annual accounts for 2019, and that the content and presentation of the report are in accordance with applicable legislation.

Directors' and Audit Committee's Responsibility for the Annual Accounts ____

The Directors are responsible for the preparation of the accompanying annual accounts in such a way that they give a true and fair view of the equity, financial position and financial performance of the Company in accordance with the financial reporting framework applicable to the entity in Spain, and for such internal control as they determine is necessary to enable the preparation of annual accounts that are free from material misstatement, whether due to fraud or error.

In preparing the annual accounts, the Directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

The audit committee is responsible for overseeing the preparation and presentation of the annual accounts.

Auditor's Responsibilities for the Audit of the Annual Accounts______________

Our objectives are to obtain reasonable assurance about whether the annual accounts as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with prevailing legislation regulating the audit of accounts in Spain will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence economic decisions of users taken on the basis of these annual accounts.

As part of an audit in accordance with prevailing legislation regulating the audit of accounts in Spain, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the annual accounts, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Directors.
Conclude on the appropriateness of the Directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the annual accounts or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the annual accounts, including the disclosures, and whether the annual accounts represent the underlying transactions and events in a manner that achieves a true and fair view.

We communicate with the audit committee of Prosegur Cash, S.A. regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the entity's audit committee with a statement that we have complied with the applicable ethical requirements, including those regarding independence, and to communicate with them all matters that may reasonably be thought to bear on our independence and, where applicable, related safeguards.

From the matters communicated to the audit committee of the entity, we determine those that were of most significance in the audit of the annual accounts of the current period and which are therefore the key audit matters.

We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

Additional Report to the Audit Committee _________________________________

The opinion expressed in this report is consistent with our additional report to the Company's audit committee dated 27 February 2020.

Contract Period __________________________________________________________

We were appointed as auditor by the shareholders at the ordinary general meeting on 3 June 2019 for a period of one year, specifically for the year ended 31 December 2019.

Previously, we were appointed by consensus of the shareholders at their general meeting, and have been auditing the annual accounts since the year ended 31 December 2016.

KPMG Auditores, S.L.

On the Spanish Official Register of Auditors ("ROAC") with No. S0702

(Signed on original in Spanish)

Bernardo Rücker-Embden

On the Spanish Official Register of Auditors ("ROAC") with No. 18,836

27 February 2020

Auditors' Report,

Annual Accounts

and Directors'

Report at 31

December 2019

(Free translation from the original in Spanish. In the event of discrepancy, the Spanish-language version prevails).

Prosegur Cash, S.A

Table of contents

PROFIT AND LOSS ACCOUNTS FOR THE YEARS ENDED AT 31 DECEMBER

	2019 AND 2018 .............................................................................................		4
II. BALANCE SHEET AT 31 DECEMBER 2019 AND 2018	.................................. 5
II. BALANCE SHEET AT 31 DECEMBER 2019 AND 2018	.................................. 6
III. STATEMENTS OF CHANGES IN EQUITY	FOR	THE YEARS ENDED 31
	DECEMBER 2019 AND 2018 .........................................................................		7
IV. CASH FLOW STATEMENTS FOR THE YEARS ENDED 31 DECEMBER 2019
	AND 2018.......................................................................................................		9
V. NOTES TO THE ANNUAL ACCOUNTS	FOR	THE YEAR ENDED 31
	DECEMBER 2019 .........................................................................................		10
1.	General Information ....................................................................................................		10
2.	Basis of Presentation ....................................................................................................		11
3.	Income and Expenses .................................................................................................		12
4.	Net Finance Income....................................................................................................		14
5.	Profit/(loss) for the year ...............................................................................................		15
6.	Intangible assets ..........................................................................................................		16
7.	Property, Plant and Equipment ..................................................................................		19
8.	Long-term investments in equity instruments of Group companies, jointly
	controlled companies and associates......................................................................		20
9.	Financial assets by category ......................................................................................		23
10.	Financial investments and commercial debtors ......................................................		24
11. Cash and cash equivalents........................................................................................		26
12. Net equity .....................................................................................................................		26
13.	Financial liabilities by category ..................................................................................		28
14. Financial debts and commercial creditors ...............................................................		29
15. Taxation ........................................................................................................................		33
	2

16. Contingencies..............................................................................................................	36
17. Commitments...............................................................................................................	37
18. Balances and transactions with related parties .......................................................	37
19. Remuneration of Directors and Senior Management Personnel............................	43
20. Employee Information.................................................................................................	44
21. Audit Fees .....................................................................................................................	45
22. Environmental information..........................................................................................	45
23. Financial risk management ........................................................................................	46
24. Events after the reporting date ..................................................................................	48
25. Accounting principles .................................................................................................	48
25.1	Intangible assets....................................................................................................................................	48
25.2	Property, plant and equipment.............................................................................................................	48
25.3	Impairment Losses on Non-financial Assets......................................................................................	49
25.4	Financial assets .....................................................................................................................................	49
25.5	Cash and cash equivalents...................................................................................................................	51
25.6	Net equity................................................................................................................................................	51
25.7	Financial liabilities.................................................................................................................................	51
25.8	Current and deferred taxes...................................................................................................................	52
25.9	Employee benefits .................................................................................................................................	52
25.10	Provisions and contingent liabilities ...................................................................................................	53
25.11	Revenue recognition .............................................................................................................................	53
25.12	Foreign currency transactions .............................................................................................................	54
25.13	Related party transactions....................................................................................................................	54
DIRECTORS' REPORT FOR 2019 .......................................................................	55

PROFIT AND LOSS ACCOUNTS FOR THE YEARS ENDED AT 31 DECEMBER 2019 AND 2018

(Expressed in thousands of Euros)		Notes		2019		2018

Net turnover	3		113,016		161,789
Dividend received			100,000	147,500
Loan interest income			1,490	2,887
Provision of services			11,526	11,402
Supplies			(1)	-
Consumption of raw materials and other consumables			(1)	-
Other operating income				1		92
Non-core and other operating revenues			-	92
Operating subsidies added to year's result			1	-
Personnel Expenses	3		(3,876)		(4,892)
Wages, salaries and similar charges			(3,163)	(4,281)
Social security obligations			(713)	(611)
Other operating expenses				(7,567)		(8,281)
External services	3	(5,545)	(7,377)
Taxes			(110)	(153)
Other ordinary expenses			(1,912)	(751)
Amortization and depreciation		6 and 7	(2,925)	(2,827)
EBIT				98,648		145,881
Financial income	4		34		198
Securities and other financial instruments			34	198
Third parties			34	198
Finance expenses	4		(14,418)		(15,355)
From payables to Group companies and associates			(3,597)	(4,519)
From payables to third parties			(10,821)	(10,836)
Exchange differences	4		1,030		1,611
NET FINANCE INCOME				(13,354)		(13,546)
PROFIT BEFORE TAX				85,294		132,335
Income tax	15		4,191		3,283
PROFIT/(LOSS) FOR THE YEAR			89,485	135,618

The accompanying notes form an integral part of the Annual Accounts for 2019.

BALANCE SHEET AT 31 DECEMBER 2019 AND 2018

(Expressed in thousands of Euros)
ASSETS		Note		2019		2018
NON-CURRENT ASSETS				1,180,451		949,638
Intangible assets	6		8,697		7,913
Patents, licences, trademarks and others			1,611	1,548
Computer software			5,920	2,925
Other intangible assets			1,166	3,440
Property, Plant and Equipment	7		1,335		255
Technical facilities and other property, plant and equipment			1,335	255
Long-term investments in Group companies and associates	8		1,169,798		940,545
Equity instrument			1,169,798	940,545
Loans to companies	9	-	-
Long-term financial investments	9		86		-
Other financial assets			86	-
Deferred tax assets	15	535	925
CURRENT ASSETS				188,622		314,858
Trade and other receivables				25,290		23,369
Clients, Group companies and associates	9	21,222	18,125
Miscellaneous receivables	9	97	497
Personnel	9	-	5
Public entities, other receivables	15	3,971	4,742
Short-term investments in Group companies and associates				120,653		288,583
Loans to companies	9	104,739	267,700
Other financial assets	9	15,914	20,883
Short-term deferrals				1,697		620
Cash and cash equivalents	11		40,982		2,286
Cash and other cash equivalents				40,982		2,286
TOTAL ASSETS				1,369,073		1,264,496

The accompanying notes form an integral part of the Annual Accounts for 2019

BALANCE SHEET AT 31 DECEMBER 2019 AND 2018

(Expressed in thousands of Euros)
NET EQUITY AND LIABILITIES		Notes		2019		2018
EQUITY				72,560		70,120
Shareholders' equity				72,560		70,120
Subscribed capital	12		30,000		30,000
Registered capital			30,000	30,000
Reserves	12		41,771		24,495
Legal and statutory reserves			6,000	6,000
Other reserves			35,771	18,495
(Own shares and equity holdings)	12		(1,546)		(1,943)
Profit/(loss) for the year	5		89,485		135,618
(Dividend on account)	5		(87,150)		(118,050)
NON-CURRENT LIABILITIES				594,974		610,537
Non-current provisions				1,668		1,296
Obligations for long-term personnel benefits	25.9	1,668	1,296
Long-term debts	13		593,306		609,241
Debentures and other negotiable securities			593,306	592,438
Debts with credit institutions			-	16,803
CURRENT LIABILITIES				701,539		583,839
Short-term debts	13		102,482		95,050
Debentures and other negotiable securities			8,872	8,872
Debts with credit institutions			75,635	61,830
Other financial liabilities	5	17,975	24,348
Short-term payables to Group companies and associates	13		552,356		474,998
Trade and other payables				46,701		13,791
Suppliers, Group companies and associates	13	40,232	4,578
Sundry accounts payable	13	3,892	4,736
Personnel (salaries payable)	13	1,124	2,690
Public entities, other payables	15		1,453		1,787
TOTAL EQUITY AND LIABILITIES				1,369,073		1,264,496

The accompanying notes form an integral part of the Annual Accounts for 2019.

STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED 31 DECEMBER 2019 AND 2018

A) STATEMENT OF RECOGNISED INCOME AND EXPENSE

(Expressed in thousands of Euros)
	Note		2019		2018
Profit/(losses) in the income statement	5	89,485	135,618
Total comprehensive income
		89,485		135,618

The accompanying notes form an integral part of the Annual Accounts for 2019.

B) STATEMENT OF TOTAL CHANGES IN EQUITY

(Expressed in thousands of Euros)
	Share capital				(Own shares and		Profit/(loss) for		(Dividend on
	Subscribed		Reserves		equity holdings)		the year		account)		TOTAL
BALANCE AT YEAR END 2017	(Note 12)		(Note 12)		(Note 12)		(Note 5)		(Note 5)
30,000		5,518		(2,127)		127,155		(107,400)		53,146
Recognised income and expense	-		-		-		135,618		-		135,618
Operations with partners or owners	-	18,977	184	(127,155)	(10,650)	(118,644)
(-) Dividend distribution	-	-	-	-	(118,050)	(118,050)
Operations with own stocks or shares (net)	-	(778)	184	-	-	(594)
Distribution of profit	-	19,755	-	(127,155)	107,400	-
BALANCE AT YEAR END 2018	30,000		24,495		(1,943)		135,618		(118,050)		70,120
Total comprehensive income	-		-		-		89,485		-		89,485
Operations with partners or owners	-	17,276	397	(135,618)	30,900	(87,045)
Operations with own stocks or shares (net)	-	(292)	397	-	-	105
Distribution of profit	-	17,568	-	(135,618)	118,050	-
Dividend on account	-	-	-	-	(87,150)	(87,150)
BALANCE AT YEAR END 2019	30,000		41,771		(1,546)		89,485		(87,150)		72,560

The accompanying notes form an integral part of the Annual Accounts for 2019.

IV. CASH FLOW STATEMENTS FOR THE YEARS ENDED 31 DECEMBER 2019 AND 2018

(Expressed in thousands of Euros)

Pre-tax financial year profit

Adjustments made to results

Fixed assets depreciation (+)

Financial income (-)

Dividend received (-)

Finance expenses (+)

Exchange differences (+/-)

Changes in current capital

Clients and other receivables (+/-)

Other current assets (+/-)

Trade and other payables (+/-)

Other current liabilities (+/-)

Other non-current assets and liabilities (+/-)

Other cash flows from operating activities

Interest payments (-)

Dividend collection (+)

Interest collection (+)

Other payments (receipts) (+/-)

Cash flows from operating activities

Payments for investments (-)

Group companies and associates

Intangible assets

Property, Plant and Equipment

Other financial assets

Collections from disposal of investments (+)

Group companies and associates

Cash flows from investing activities

Collections and payments for equity instruments

Purchases of equity instruments (-)

Sale of equity instruments (+)

Collections and payments for liability instruments

Issue

Debentures and similar securities (+)

Debts w ith credit institutions (+)

Other payables (+)

Repayment and amortisation of

Debts w ith credit institutions (-)

Dividends payable and remunerations from other equity instruments

Dividends (-)

Cash flows from financing activities

NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS

Cash and equivalents at the beginning of the year

Cash and equivalents at the end of the year

Note

6 and 7

20192018

85,294 132,335

(83,721) (131,127)

2,9252,827

(198)
(100,000) (147,500)
14,41815,355
(1,030)(1,611)
22,308 (32,023)

(3,929)(494)

(26,931)

34,811(5,894)

(8,273)-

1,296

6,862

(1,602) (10,836)

17,500

34198

1,326-

23,638 (23,953)

(71,166) (93,095)

(66,292) (88,124)

(3,582)(4,840)

(1,206)(131)

-
197,60052,994
197,60052,994

126,434 (40,101)

397(594)

(778)
397184

(1,760)71,496

1,24071,496

1,2407,193

60,337
3,966

(3,000)-

(110,013) (94,552)

(111,376) (23,650)

38,696 (87,704)

2,28689,990

40,9822,286

The accompanying notes form an integral part of the Annual Accounts for 2019.

V. NOTES TO THE ANNUAL ACCOUNTS FOR THE YEAR ENDED 31 DECEMBER 2019

1. General Information

Prosegur Cash, S.A., (hereinafter, the Company) is a company belonging to the Prosegur Group. It is the parent Company of a Group of companies in accordance with current legislation (hereinafter the Prosegur Cash Group). The registered offices of Prosegur Cash, S.A. are at Calle Santa Sabina number 8, Madrid (Spain). It was incorporated on 22 February 2016 and is registered in the Mercantile Register of Madrid, in volume 34,442, page 34, section 8, page number M-619528, entry 1.

The Company is a subsidiary controlled by the Spanish company Prosegur Compañía de Seguridad, S.A. (hereinafter, Prosegur), which currently owns 51% of its shares, indirectly controlling another 21.5% via its 100%-owned investee Prosegur Assets Management, S.L.U., consolidating both the Company and its subsidiaries in its financial statements (hereinafter, Prosegur Group).

On 17 March 2017, the Company shares began trading at EUR 2 per share in the Stock Exchanges of Madrid, Barcelona, Bilbao and Valencia via the Spanish Stock Exchange Interconnection System (SIBE). On 7 April 2017, the Green Shoe period of the stock market flotation ended, and the free float attained 27.5% of the share capital of Company.

The corporate purpose is described in Article 2 of its Articles of Association and it is the following:

Provision of securities logistics services and cash management, including the following activities:

National and international transport services (by land, sea and air) of funds and other valuables (including jewellery, artworks, precious metals, electronic devices, voting ballots, legal evidence), including collection, transport, custody and deposit services;
Processing and automation of cash (including counting, processing and packaging, as well as coin recycling, cash flow control and monitoring systems);
Comprehensive ATM solutions (including planning, loading, monitoring, first- and second-tier maintenance and balancing);
Cash planning and forecasting for financial institutions;
Self-servicecash machines - smart cash (including cash deposits, recycling services and dispensing of bank notes and coins, and payment of invoices); and
Added-valueoutsourcing services (AVOS) for banks (including outsourcing of tellers, multi- agency services, cheque processing and related administrative services).

The activities comprising the corporate purpose can also be performed indirectly by the Company, by means of the shareholding in other companies of an identical or similar corporate purpose. The main activity of the Company in 2019 corresponds to that of group company holding, with its income coming from group companies, mainly relating to dividends and services.

The Company's statutory activity does not include activities expressly restricted by law to entities that comply with special requirements not met by the Company, particularly financial brokerage activities that are restricted by financial legislation governing collective investment undertakings and the securities market law and supplementary provisions applicable to collective investment undertakings.

In accordance with generally accepted accounting principles in Spain, consolidated Annual Accounts must be prepared to present fairly the financial position of the Group Prosegur Cash, the results of operations and changes in its equity and cash flows.

The Directors prepare the Consolidated Annual Accounts of the Group Prosegur Cash, in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and approved by the European Commission Regulations in force at 31 December 2019. The consolidated Annual Accounts were drawn up by the Board of Directors, together with these Individual Annual Accounts, on 26 February 2020 and are pending approval by the shareholders at their general meeting, after which they will be filed at the Mercantile Register of Madrid.

The Consolidated Annual Accounts of Prosegur Cash, S.A. and its subsidiaries for 2019 present consolidated profit of EUR 169,016 thousand (EUR 174,217 thousand in 2018) and consolidated equity of EUR 243,633 thousand (EUR 237,991 thousand in 2018).

2. Basis of Presentation

Fair image

The Annual Accounts have been in accordance with mercantile legislation in force and the rules established in the General Chart of Accounts approved by Royal Decree 1514/2007, in order to reflect a true and fair image of the equity, financial situation and results of the Company, as well as the veracity of the cash flows shown in the cash flow statement.

Comparative information

For comparative purposes and for each item in the balance sheet, income statement, statement of changes in equity, cash flow statement and notes to the Annual Accounts, in addition to the figures for financial year 2019, the Annual Accounts show those pertaining to the previous year, those of 2018, approved by the General Shareholders' Meeting at 3 June 2019.

Functional currency

The figures disclosed in the Annual Accounts are expressed in thousands of EUR, the Company's functional and presentation currency.

Going concern

As of 31 December 2019, the Company has a negative working capital of EUR 512,917 thousand (EUR 268,981 thousand at 31 December 2018). As indicated in Note 1, the Company is the head of the Prosegur Cash Group, which at 31 December 2019 presented a positive working capital of EUR 57,235 thousand (EUR 166,595 thousand at 31 December 2018) in the Consolidated Annual Accounts. The Company also has the capacity to generate future cash flows via the management of its subsidiaries' dividends. Additionally, as of 31 December 2019, the Group presents a consolidated result attributable to Prosegur Cash, S.A. as Parent Company of EUR 168,942 thousand (EUR 174,217 thousand at 31 December 2018). Finally, as indicated in Notes 19 and 22 of the Consolidated Annual Accounts of the Prosegur Cash Group, at 31 December 2019, the Group companies had available treasury of EUR 307,423 thousand and had been granted undrawn additional financing of EUR 448,633 thousand (EUR 273,756 thousand and EUR 404,624 thousand as of 31 December 2018, respectively).

Taking these facts into consideration, the Company's Directors have prepared these Annual Accounts on the ongoing management principle.

Critical issues regarding the valuation and estimation of relevant uncertainties

Preparation of the Annual Accounts requires the Company to make certain estimates and judgements concerning the future. These are evaluated constantly and based on historical experience and other factors, including expectations of future events that are considered reasonable under certain circumstances.

Although estimates are calculated by the Company's Directors based on the best information available at year end, future events may require changes to these estimates in subsequent years. Any effect on the balance sheet of adjustments to be made in subsequent years would be recognised prospectively.

The estimates and judgements that present significant risk of a material adjustment to the carrying amounts of assets and liabilities in the subsequent reporting period are as follows:

Investments in Group companies

The Company carries out impairment testing on investments made in subsidiaries if there is any proof of value impairment. The calculation of impairment involves the comparison of the carrying amount of the investment with its recovery value, this being understood as the higher fair value less cost of sale and value in use. The Company generally uses cash flow discounting methods to calculate these values. Discounted cash flow calculations are based on four-year projections of the budgets approved by Management. The cash flows take into account past experience and represent Management's best estimate of future market performance. Cash flows as of four years are extrapolated using individual growth rates. The key assumptions to determine the fair value less cost of sale and value in use include growth rates, average weighted rate of capital and tax rates.

3. Income and Expenses

Net turnover

Details of net turnover by category of activity and geographical area are as follows:

							Thousands of euros
	National		Rest of Europe		Rest of the world		Total
	2019	2018	2019	2018	2019	2018	2019		2018
Group companies and associates
- Dividend received	100,000	147,500	-	-	-	-	100,000		147,500
- Loan interest income	393	1,713	285	620	812	554	1,490		2,887
- Provision of services	(3,730)		(8,095)		(8 )		2,470	15,264		17,027	11,526	11,402
Total	96,663		141,118		277		3,090	16,076		17,581	113,016	161,789

Dividend income and loan interest income were considered under this category, taking into account the condition of the holding company (Note 1).

In the provision of services, income and expenditure corresponding to centralised services and trademark assignment services were considered, which implies that their distribution by geographical area is negative in the Country (Note 18). The negative amounts for the services are due to payments for trademark assignment billing.

Wages, salaries and similar charges

The breakdown of personnel expenses in 2019 and 2018 is as follows:

	Thousands of euros
	2019	2018
Salaries and wages	3,163			4,281
Social security obligations	713		611
Total	3,876	4,892

The 2017 and 2020 long-term incentive plans for Executive Director and Senior Management (Note 25.9), within the Salaries and wages paragraph, have been included in the expense accrued during the year in relation to the 2019 commitment amounting to EUR 840 thousand (EUR 1,852 thousand in 2018). Additionally, under Salaries and wages have been included a reversal during 2019 for the mentioned incentive plan, amounted to EUR 2,889.

The breakdown of Social security obligationsin 2019 and 2018 are as follows:

Thousands of euros

	2019		2018
Social Security Payable by the Company	575	548
Other employee benefits expenses		138	63
Total		713	611

External services

The breakdown of external services in 2019 and 2018 are as follows:

	Thousands of euros

	2019		2018
Leases and levies	785	138
Repairs and conservation	977	905
Independent professional services	3,328	5,233
Transport	4	20
Banking and similar services	112	214
Insurance expenses	-	92
Advertising, publicity and public relations	163	192
Supplies and others	84	120
Other services	92		463
Total	5,545	7,377

The maintenance expense of the Company's software is included under Other repairs and conservation.

The category of Independent professional services mainly includes the expenses for services of identification and capture of business opportunities, as well as IT technical assistance.

4. Net Finance Income

The breakdown of financial income and expenses in 2019 and 2018 are as follows:

	Thousands of euros
Financial income	2019	2018
34		198
Third parties	34	198
Finance expenses	(14,418)	(15,355)
From payables to Group companies (Note 18)	(3,597)	(4,519)
From payables to third parties	(10,821)	(10,836)
Exchange differences	1,030	1,611
Net Finance Income	(13,354)		(13,546)

The item from which the exchange difference comes is as follows:

		Thousands of euros
		2019		2018
Loans to Group companies and associates	1,030	1,611

		1,030	1,611

Exchange profit/losses

The main currency conversion difference items are the following:

	Currency		Thousands of euros
		2019		2018
Structured time deposits	US Dollar	-	174
Group company acquisition	US Dollar	-	228
Current accounts	US Dollar	162	(27)
Suppliers	US Dollar	(44)	4
Loans to Group company	South African Rand	798	1,485
Current accounts	South African Rand	171	334
Loans to Group company	Australian Dollar	13	(707)
Current accounts	Australian Dollar	141	(26)
Other Group company loans	Philippine Peso	(39)	-
Loans to Group company	Peruvian Sol	(207)	23
Suppliers	Argentine Peso	36	124
			1,030		1,611

5. Profit/(loss) for the year

On the date these Annual Accounts are authorised for issue, the Boards of Directors will propose to the General Shareholders' Meeting that profit for the year be distributed as follows:

				Thousands of euros
Basis of allocation		2019	2018

Profit and losses	89,485	135,618
Total		89,485		135,618
Allocation
Legal reserve	-	-
Voluntary reserves	2,335	17,568
Dividends on account	87,150	118,050
Total		89,485			135,618

In a meeting on 19 December 2018, the Board of Directors approved the distribution of a regular dividend on account of the profits of 2018 of EUR 0.07870 gross per share, which implies a maximum total dividend of EUR 118,050 thousand (considering that the current share capital is divided into 1,500 million shares). This dividend was distributed to shareholders as four payments, in December 2018 and March, June and September 2019. Each payment is calculated as EUR 0.019675 per outstanding share at the payment date.

As of 31 December 2018, a debt for dividends payable in 2019 was held for EUR 88,538 thousand, which was presented in current liabilities in other accounts payable under the heading of suppliers and other financial liabilities for an amount of EUR 24,348 thousand and in the heading of payables to group companies and associates for EUR 64,190 thousand.

As of 31 December 2019, a debt for dividends payable in 2020 is held for EUR 65,363 thousand, which is presented in current liabilities in other accounts payable under the heading of suppliers and other financial liabilities for an amount of EUR 17,975 thousand and in the heading of payables to group companies and associates for EUR 47,388 thousand.

In a meeting on 28 December 2019, the Board of Directors approved the distribution of a regular dividend on account of the profits of 2019 of EUR 0.0581 gross per share, which implies a maximum total dividend of EUR 87,150 thousand (considering that the current share capital is divided into 1,500 million shares). This dividend will be distributed to shareholders as four payments, in December 2019 and March, June and September 2020. Each payment is calculated as EUR 0.0145 per outstanding share at the payment date.

The maximum amount represented by own shares at each payment date, and therefore not distributed, will be transferred to voluntary reserves. The amount for undistributed as dividends out the maximum total agreed for the year 2019 is reflected in "own shares and equity holdings" of the statement of changes in equity for an amount of EUR 1,547 thousand.

Nevertheless, if the number of shares changes between two payment dates as a result of a share capital increase or reduction, the total maximum amount of the dividend at each payment date (EUR 19,756 thousand) should be divided by the new number of outstanding shares that corresponds following the aforementioned increase or reduction.

The provisional accounting statement presented by the Board of Directors in accordance with the legal requirements that evidenced the lack of sufficient liquidity to pay the aforementioned interim dividend is set forth below:

			Thousands of
			euros
	2019
1. Initial cash on hand (before the interim dividend)		(24,663)
2. Group current bank account balances	(157,678)
3. Proceeds pending	486
4. Proceeds through Financial Transactions	300,000
5. Receipts for Capital and Extraordinary Transactions	-
5. Payments for Current Operations	(2,557)
6. Payments for Financial Transactions	(7,497)
7. Extraordinary Payments	(1,413)
Forecast Cash	106,678
Less dividend payments according to the proposal	(87,150)
Final cash after dividends
	19,528

6. Intangible assets

The composition and movements in the accounts of intangible fixed assets were as follows:

			Thousands of euros

			Computer		Other
	Licences			intangible		Total
		software
				assets

Cost
Balance at 1 January 2018
1,923		4,698	4,223	10,844
Additions	411		420		2,176		3,007
Transfers	-		2,244		(2,244)		-
Balance at 31 December 2018	2,334		7,362	4,155	13,851
Additions	344		3,140		318		3,802
Disposals	-	-	(220)	(220)
Transfers	-		2,208		(2,208)		-
Balance at 31 December 2019	2,678		12,710		2,045	17,433
Depreciation and amortisation
Balance at 1 January 2018
(506)		(2,357)		(340)		(3,203)
Amortisation for the year	(280)		(2,080)		(375)		(2,735)
Balance at 31 December 2018	(786)		(4,437)		(715)		(5,938)
Amortisation for the year	(281)		(2,353)		(164)		(2,798)
Balance at 31 December 2019	(1,067)		(6,790)	(879)	(8,736)
Carrying amount
At 31 December 2018	1,548		2,925		3,440		7,913
At 31 December 2019
1,611		5,920		1,166		8,697

Description of the main movements

The most significant additions in 2019 correspond to:

Computer applications: GAP Evolutionary Project, CASH DEVICE INTEGRATION, DEVICE MANAGER Evolutionary Project and others for EUR 3,140 thousand. The remaining additions correspond to the development of applications or projects and their implementation for EUR 2,293 thousand.
Microsoft Software Licences, GELT, ICOM and licences for device integration for EUR 344 thousand.
The remaining additions corresponded to the development of applications or projects and their implementation for EUR 1,091 thousand.
Intangible assets in progress in 2019 correspond entirely to IT applications and IT development projects of which we can cite PR6677 SSO Introduction for CASH INNOVATION for EUR 114 thousand, PR6869 PRY-Certificate system for GENESIS for EUR 94 thousand, PR5273 Project-Deployment PROFAT CL-CASH for EUR 37 thousand, and the rest correspond to the registration of projects and application developments amounting to EUR 73 thousand.

The most significant additions in 2018 correspond to:

Licences AXWAY Licences for EUR 234 thousand, INTELLIMATCH Tool licences for EUR 100 thousand, CORPOINT DEPOSIT MANAGER licence for EUR 65 thousand; the rest corresponded to the addition of Digital Certificates and Microsoft Licences for EUR 11 thousand.
Intangible fixed assets in progress in 2018 correspond entirely to DTI computer applications and IT development projects, of which we can mention PR5489 Switching-Value Date for EUR 330 thousand, PR5487 Integration CASH devices for EUR 320 thousand, PR5485 Evolutionary GAP Project for EUR 303 thousand, PR5484 Evolutionary DEVICE MANAGER for EUR 276 thousand, PR5823 Business Flows for the INNOVACION platform for EUR 175 thousand, PR5966 Cash Centres-Development module Treasury Balances for EUR 150 thousand and PR5518 Evolutionary Project QA CASH for EUR 149 thousand.

The most significant disposals in the intangible assets in 2019 correspond to disposals from ongoing projects that are cancelled or suspended, for EUR 220 thousand.

There are no significant disposals of property, plant and equipment in 2018.

Licences

Details of licences at year end are as follows:

					Thousands of euros
					2019
Description and	Expiry date	Amortisation		Amortisation	Cost	Accumulated	Carrying
operation	period		for the year	amortisation	amount

Licences - Software	2017	1 years	-	172	172	-
Licences - Software	2022	1 years	11	97	97	-
Licences - Software	2023	10 years	12	56	42	14
Licences - Software	2024	10 years	36	220	123	97
Licences - Software	2025	10 years	119	825	406	419
Licences - Software	2026	10 years	21	206	71	135
Licences - Software	2027	10 years	36	347	86	261
Licences - Software	2028	10 years	41	411	65	346
Licences - Software	2029	10 years	5	344	5	339

			281	2,678	1,067	1,611

					Thousands of euros
					2018
Description and	Expiry date	Amortisation		Amortisation	Cost	Accumulated	Carrying
operation	period		for the year	amortisation	amount

Licences - Software	2017	1 years	-	172	172	-
Licences - Software	2022	1 years	33	97	86	11
Licences - Software	2023	10 years	12	56	30	26
Licences - Software	2024	10 years	36	220	87	133
Licences - Software	2025	10 years	120	825	287	538
Licences - Software	2026	10 years	21	206	50	156
Licences - Software	2027	10 years	34	347	50	297
Licences - Software	2028	10 years	24	411	24	387

				280	2,334	786	1,548

Fully amortised intangible assets

The intangible assets fully amortised as of31 December 2019 and 2018 are the following:

	Thousands of euros
	2019		2018
Computer software	3,383	1,036
Licences	269	172
Other intangible assets	491		421
	4,143	1,629

Other disclosures

There were no purchases of intangible assets from Group companies in 2019 or 2018.

At 31 December 2019 and 2018 the Company has no intangible fixed assets subject to title restrictions or pledged as security for liabilities.

7. Property, Plant and Equipment

The composition and movements of the accounts of property, plant and equipment were as follows:

											Thousands of euros

									Technical		Other install.,	Other
									installations		equipment and	property, plant		Total
									and machinery		furniture	and equipment
Cost


Balance at 1 January 2018		29		25		279		333
Additions			53		64		15						132
Balance at 31 December 2018	82	89	294	465
Additions						985
		22		199
				1,206
Balance at 31 December 2019		104		1,074		493		1,671
Depreciation and amortisation

Balance at 1 January 2018	(3)	(4)	(110)	(117)
Depreciation and amortisation							(7)
			(9)		(77)
					(93)
Balance at 31 December 2018		(12)		(11)		(187)		(210)
Depreciation and amortisation						(11)		(29)		(86)			(126)
Balance at 31 December 2019		(23)		(40)		(273)		(336)
Carrying amount
At 31 December 2018							70		78		107	255
At 31 December 2019
						81		1,034		220		1,335

Description of the main movements

The most significant additions of property, plant and equipment in 2019 correspond to the installation and rehabilitation of the Building in Calle San Máximo for EUR 775 thousand, additions of other property, plant and equipment in the same building for EUR 210 thousand, discharges for other property, plant and information processing equipment amounting to EUR 78 thousand, radio link equipment for EUR 97 thousand and other property, plant and equipment for EUR 23 thousand.

The most significant additions of property, plant and equipment in 2018 corresponded to Glory machinery, SDM-100 cash deposit for EUR 53 thousand, addition of installations in the Doctor Esquerdo Building for EUR 64 thousand and the addition of information and telephony processing equipment for EUR 15 thousand.

There were no disposals in property, plant and equipment in 2019 nor in 2018.

Fully depreciated property, plant and equipment

The items of property, plant and equipment fully depreciated as 31 December 2019 are as follows:

	Thousands of euros
	2019		2018
Technical installations and machinery	1	1
Other property, plant and equipment	132		48
	133	49

Other disclosures

There were no purchases of property, plant and equipment from Group companies in 2019 nor in 2018.

At 31 December 2019 and 2018 the Company has no property, plant and equipment subject to restrictions on title or pledged as security for liabilities.

The Company has taken out insurance policies to cover the risk of damage to its property, plant and equipment. The coverage of these policies is considered sufficient.

8. Long-term investments in equity instruments of Group companies, jointly controlled companies and associates

Details of the movements in investments in Group companies, jointly controlled companies and associates are as follows:

Balance at 1 January	Thousands of euros
2019	2018
Investments	940,545		940,545
Additions	229,253	-
Disposals	-	-
Balance at 31 December	1,169,798		940,545

Investments in Group companies as of 31 December 2019 and 2018 include direct investments in the share capital of the following companies:

Company	Thousands of euros
2019		2018
Prosegur Global CIT, S.L.U.	920,954	763,904
Prosegur Global CIT ROW, S.L.U.	215,641	176,641
Prosegur Avos España, S.L.	30,200	-
Prosegur Alpha3 Cashlabs, S.L.	3,003	-
	1,169,798		940,545

From the incorporation of the Company and until the date of the Balance Sheet on 31 December 2019, the following operations were carried out:

Additions

During the 2019, the operations were as follows:

		Thousands of euros
		2019	2018
Prosegur Global CIT, S.L.U.	(1)	157,050			-
Prosegur Global CIT ROW, S.L.U.	(2)	39,000	-
Prosegur Avos España, S.L.	(3)	30,200	-
Prosegur Alpha3 Cashlabs, S.L.	(4)	3,003		-
Total		229,253		-

Prosegur Global CIT, S.L.U.:

On 1 January 2019, the Company participated in the capital increase of the company Prosegur Global CIT S.L.U. for EUR 131,050 thousand through the partial depreciation of the credit right held against said Company.
On 24 June 2019, the Company participated in the capital increase of the company Prosegur Global CIT S.L.U. for EUR 26,000 thousand through the partial depreciation of the credit right held against it.

Prosegur Global CIT ROW, S.L.U

On 1 January 2019, a capital increase was made in the company for an amount of EUR 39,000 thousand through the partial depreciation of the credit right held against said Company.

Prosegur Avos España, S.L.

On 19 December 2019 the Company participated in the purchase of shares in the Spanish company Prosegur Avos España, S.L. by capitalising loans totalling EUR 30,200 thousand.

Prosegur Alpha3 Cashlabs, S.L.

On 14 March 2019, Prosegur Cash, S.A. constituted the Spanish company Prosegur Alpha3 Cashlabs, S.L. with a capital of EUR 3 thousand, paid in full. This company subsequently received the following capital contributions:
On 24 May 2019 the Company participated in the capital increase of the Spanish company Prosegur Alpha3 Cashlabs, S.L. by capitalising loans totalling EUR 2,250.
On 29 May 2019 the Company participated in the capital increase of the Spanish company Prosegur Alpha3 Cashlabs, S.L.. by capitalising loans totalling EUR 450 thousand.
On 18 November 2019 the Company participated in the capital increase of the Spanish company Prosegur Alpha3 Cashlabs, S.L. by fully out laid cash contributions of EUR 300 thousand.

Disposals

There have been no decreases in investments in Group, multi-group and associated companies during the years 2019 and 2018.

Impairment

The Company annually evaluates the existence of indicators of impairment of the stakes in Group companies and estimates the recoverable value at the closing date of those entities for which there are signs of impairment. The impairment indicator was calculated by comparing the net book value of the stake with the net worth of the investee and the recoverable value of the entities with an impairment indicator was determined considering its value in use for the Cash and Surveillance businesses and based on the fair value for the companies of the alarm business. Based on the analysis made, the Company did not record any valuation adjustments for stock impairment during the year. In 2019 and 2018, there were no impairment losses in investments in Group, multi-group and associated companies.

Investments in Group companies

Below is the information relating to shares held in Group companies as of 31 December 2019 and 2018:

2019
Name	Registered			Sharehold
offices	Activity	ing
Prosegur Global CIT, S.L.U.	C/ Pajaritos, 24, Madrid - Spain	Activity linked to the Cash business line	100%
Prosegur Global CIT ROW, S.L.U.	C/ Pajaritos, 24, Madrid - Spain	Activity linked to the Cash business line	100%
Prosegur Avos España, S.L.	C/ Pajaritos, 24, Madrid - Spain	Activity linked to the Cash business line	100%
Prosegur Alpha3 Cashlabs, S.L.	C/ Pajaritos, 24, Madrid - Spain	Activity linked to the Cash business line	88%
2018
	Registered			Sharehold
Name	offices	Activity	ing
Prosegur Global CIT, S.L.U.	C/ Pajaritos, 24, Madrid - Spain	Activity linked to the Cash business line	100%
Prosegur Global CIT ROW, S.L.U.	C/ Pajaritos, 24, Madrid - Spain	Activity linked to the Cash business line	100%

The breakdown of the shareholders' equity as of 31 December 2019 of the investments in Group companies in which the Company holds 100% of the share capital is as follows:

(Expressed in thousands of Euros)	Share capital	Share	Reserves	Profit/(loss) for the	Dividend
premium	year

Prosegur Global CIT, S.L.U.	157,053	708,286	171,697	185,243	(100,000)
Prosegur Global CIT ROW, S.L.U.	39,003	180,002	27,766	36,129	-
Prosegur Avos España, S.L.	3	2,600	(1,286)	(709)	-
Prosegur Alpha3 Cashlabs, S.L.	380	3,019	-	(11)	-

The breakdown of the shareholders' equity as of 31 December 2018 of the investments in Group companies in which the Company holds 100% of the share capital is as follows:

(Expressed in thousands of Euros)	Share capital		Share	Reserves	Profit/(loss) for the	Dividend
	premium	year

Prosegur Global CIT, S.L.U.		3	708,286	148,831	152,866	(130,000)
Prosegur Global CIT ROW, S.L.U.		3	180,002	4,802	40,464	(17,500)

9. Financial assets by category

Classification of the financial assets by categories

Thousands of euros

2019

At amortised cost or cost

Carrying Total

amount

Thousands of euros

2018

At amortised cost or cost

Carrying Total

amount

Non-current
Long-term financial investments
Other financial assets	86	86	-	-
Total current	86				86		-	-
Current
Loans and receivables
Loans to Group companies (Note 18)	104,739	104,739	267,700	267,700
Current account with Group companies	-	-	-	-
Other financial assets (Note 18)	15,914	15,914	20,883	20,883
Clients, Group companies and associates (Note 18)	21,222	21,222	18,125	18,125
Clients receivables for sales and services	-	-	-	-
Personnel	-	-	5	5
Miscellaneous receivables	97	97	497	497
Total current
	141,972					141,972		307,210		307,210
Total financial assets
	142,058				142,058		307,210		307,210

The carrying amount of the financial assets valued at cost or at amortised cost is close to their fair value, given the non-significant effect of the discount.

In 2019, long-term bonds were established with other companies, amounting to EUR 86 thousand and recorded under the heading "Other financial assets" in the long term.

10. Financial investments and commercial debtors

Classification by maturities

The classification of financial assets by maturities is as follows:

				Thousands of euros
				2019	2018
				Total			Total
Long-term financial investments

Other financial assets	86	-
				86			-
Investments in Group
Loans to companies	104,739	267,700
Other financial assets		15,914		20,883
				120,653		288,583
Trade and other receivables
Clients, Group companies and associates	21,222	18,125
Personnel	-	5
Miscellaneous receivables		97		497
				21,319	18,627
Total			142,058			307,210

Other information on financial assets Loans to companies

The breakdown of the main characteristics of the loans as of 31 December 2019 is as follows:

2019

Thousands of euros

							Carrying
					Maturity		amount
Type		Currency		Interest rate	Par value	Current
		date

Group and associates
Prosegur Colombia 3 SLU		EUR	0.75%	31/12/2020	8,240	8,240
Prosegur AVOS España SL		EUR	0.75%	31/12/2020	45,477	45,477
Prosegur International CIT 1 SL		EUR	0.75%	31/12/2020	2,268	2,268
Inversiones CIT 2 SLU		EUR	0.75%	31/12/2020	49	49
Prosegur Global CIT ROW SLU		EUR	0.75%	31/12/2020	16,568	16,568
Prosegur Colombia 1 SLU		EUR	0.75%	31/12/2020	4,725	4,725
Prosegur Colombia 2 SLU		EUR	0.75%	31/12/2020	4,631	4,631
Prosegur Servicios de Pago EP SLU		EUR	0.75%	31/12/2020	181	181
Risk Management Solutions SLU		EUR	0.75%	31/12/2020	1,657	1,657
Compliofficer SLU		EUR	0.75%	31/12/2020	131	131
Work 4 Data Lab SL		EUR	0.75%	31/12/2020	549	549
Enclama SL		EUR	0.75%	31/12/2020	1	1
Prosegur Cash Services Germany GmbH		EUR	1.00%	31/12/2020	10,000	10,000
Luxpai CIT SARL		EUR	1.00%	31/12/2020	375	375
Prosegur Global Resources Holding Philipines Incorporated		Philippine Peso	7.35%	31/12/2020	3,535	3,535
Prosegur Transportadora de Caudales SA		EUR	4.00%	31/12/2020	2,823	2,823
Prosegur Australia Investments PTY Limited	Australian Dollar	3.75%	31/12/2020	3,466	3,466
Prosegur Seguridad Privada Logistica y Gestion de Efectivo SA de CV		EUR	3.00%	31/12/2020	63	63
Total						104,739	104,739

(*) These balances are a consequence of the daily sweeping of cash-pooling accounts (Note 18)

The breakdown of the main characteristics of the loans as of 31 December 2018 is as follows:

2018

Thousands of euros

					Maturity		Carrying
Type		Currency		Interest rate	Par value	Current
		date

Group and associates
MIV Gestion, S.A.		EUR	0.75%	31/12/2019	830	830
Prosegur Global CIT, S.L.U		EUR	0.75%	31/12/2019	126,860	126,860
Prosegur Colombia 3, S.L.		EUR	0.75%	31/12/2019	93	93
Prosegur Avos España, S.L.		EUR	0.75%	31/12/2019	31,071	31,071
Prosegur International CIT 1, S.L.U.		EUR	0.75%	31/12/2019	873	873
Inversiones CIT 2, S.L.U.		EUR	0.75%	31/12/2019	5,090	5,090
Prosegur Global CIT ROW, S.L.U.		EUR	0.75%	31/12/2019	47,105	47,105
Prosegur Colombia 2, S.L.		EUR	0.75%	31/12/2019	4,866	4,866
Prosegur Cash Holding France, SAS		EUR	3.25%	31/12/2019	14,344	14,344
Luxpai CIT SARL		EUR	1.00%	31/12/2019	450	450
Prosegur Transportadora de Caudales SA	Uruguayan Peso	5.00%	31/12/2019	2,944	2,944
Prosegur Seguridad Privada Logistica Y Gestion de Efectivo UO		Mexican Peso	7.25%	31/12/2019	48	48
Prosegur Australia Investments	Australian Dollar	3.50%	31/12/2019	17,115	17,115
Prosegur Cash Services Germany GMBH		EUR	0.75%	31/12/2019	11,146	11,146
Prosegur Colombia 1 SLU		EUR	0.75%	31/12/2019	4,865	4,865

Total						267,700	267,700

(*) These balances are a consequence of the daily sweeping of cash-pooling accounts (Note 18)

Other financial assets

Under this heading are the balances for the current accounts held with the different Group companies that include the payments and collections of the amounts to be paid/charged for the different services received/provided or other operations performed.

11. Cash and cash equivalents

Details of cash and cash equivalents at 31 December 2019 and 2018, are as follows:

	Thousands of euros
	2019		2018
Cash and other cash equivalents	40,982	2,286
Total	40,982		2,286

Cash in hand and at banks essentially reflects cash at banks at each year end.

12. Net equity

Share capital

The Company was constituted by Prosegur Compañía de Seguridad, S.A. on 22 February 2016. The share capital of the Company was EUR three thousand, represented by 3,000 shares of EUR one par value each. The shareholdings were fully paid by Prosegur Compañía de Seguridad, S.A. through a monetary contribution.

The Company, by virtue of the agreement reached by the Sole Shareholder on 6 May 2016, increased its share capital by EUR one by issuing 1 new share of EUR one par value through a non- monetary contribution of 100% of the shares of the Spanish Prosegur Global CIT ROW, S.L.U.. This capital increase was created with a total share premium of EUR 176,641 thousand.

Also, by virtue of what was agreed upon by the Sole Shareholder on 26 July 2016, the Company increased its share capital by EUR 29,996,999 through the issuance of 29,996,999 new shares with a par value of EUR one, via a non-monetary contribution of 100% of the shares of the Spanish Prosegur Global CIT, S.L.U. This capital increase was made with a total share premium of EUR 733,907 thousand.

On 21 September 2016, the Sole Shareholder agreed to turn the Company into a public limited company and replace the 30,000,000 participations with a par value of EUR one each for 300,000,000 new nominative shares with a par value of EUR 0.10 each, all of the new shares being attributed to Prosegur Compañía de Seguridad, S.A.

On 30 November 2016 Prosegur Compañía de Seguridad, S.A. underwent a capital increase of the Spanish company Prosegur Assets Management, S.L.U. through the contribution of 49% of the shares of Prosegur Cash, S.A.

On 19 December 2016, the Shareholders' Meeting of the Company agreed to split each share of EUR 0.10 of par value into 5 shares of EUR 0.02 of par value, in such a way that the share capital became divided into 1,500,000,000 shares of EUR 0.02 of par value each. Likewise, it was agreed to transform the representation system of the Company shares from registered securities into book entries.

At 31 December 2019 and 2018,, the share capital of Prosegur Compañía de Seguridad, S.A. totals EUR 30,000 thousand and is represented by 1,500,000,000 shares with a par value of EUR 0.02 each, fully subscribed and paid. These shares are listed on the Madrid, Barcelona, Valencia and Bilbao Stock Markets and are traded via the Spanish Stock Market Interconnection System (electronic trading system) (SIBE).

These shares are freely transferable.

Details of the Company's shareholders are as follows:

Shareholders		Number of shares
31/12/2019		2019
Ms Helena Revoredo Delvecchio (1)	1,087,500,000	72.50%
Invesco (2)	56,805,000	3.79%
Others	355,695,000	23.71%
Total
	1,500,000,000		100.00%

1. Investment through Prosegur Compañía de Seguridad, S.A.
2. Investment through various managed funds.
Own shares and equity holdings

On 7 July 2017, coming into force on 11 July of the same year, the Company entered into a liquidity contract to favour share liquidity. Said agreement is in force as of 31 December 2019, the date on which Prosegur Cash, S.A.'s treasury stock amounted to 1,119,862 shares (1,057,307 shares in 2018), of which 696,866 (602,496 in 2018) are linked to the liquidity contract.

Details of changes in own shares during the year are as follows:

				Thousands
Balance at 31 December 2018	Number of shares			of euros
1,057,307		1,943
Purchase of own shares	10,593,125	17,656
Sale of own shares	(10,498,755)	(17,988)
Other awards	(31,815)		(64)
Balance at 31 December 2019	1,119,862			1,546

Prosegur Cash holds 0.07% (0.07% in 2018) of treasury stock deemed strategic to satisfy possible future corporate transactions.

13. Financial liabilities by category

Classification of financial liabilities by category

The classification of financial liabilities by categories and classes, as well as the comparison of fair value and carrying amount is as follows:

												Thousands of euros
									2019
												At amortised cost or cost
				Debentures				Debts with				Payables to				Trade and			Other financial
				and other
							credit				Group								Total
				negotiable										other payables				liabilities
							institutions				companies
				securities

Non-currents
Debts and payables (Note 14)	593,306	-	-	-	-	593,306
				593,306				-				-				-			-		593,306
Current
Debts and payables (Note 14)	8,872	75,635	552,356	45,248	17,975	700,086
Total	602,179				75,635				552,356				45,248				17,975		1,293,392
												Thousands of euros
									2018
												At amortised cost or cost
				Debentures				Debts with				Payables to				Trade and			Other financial
				and other				credit				Group								Total
													other payables				liabilities
				negotiable				institutions				companies

Non-currents
Debts and payables (Note 14)		592,438		16,803		-		-		-		609,241
				592,438		16,803		-		-		-		609,241
Current
Debts and payables (Note 14)		8,872		61,830		474,998		12,004		24,348		582,052
				8,872	61,830	474,998	12,004	24,348	582,052
Total			601,310			78,633			474,998			12,004			24,348		1,191,293

Debentures and other negotiable securities

On 4 December 2017, Prosegur Cash, S.A. launched a EUR 600,000 thousand bond issue maturing on 4 February 2026. The bond was issued in the Euromarket as part of the Euro Medium Term Note Programme. This issue will enable the deferment of maturities of part of the debt of Prosegur Cash and the diversification of funding sources. The bonds are traded on the secondary market, on the Irish Stock Exchange. They accrue an annual coupon of 1.38% payable at the end of each year.

The carrying amount of the financial liabilities valued at cost or at amortised cost is close to their fair value, given the non-significant effect of the discount.

14. Financial debts and commercial creditors

Debts with credit institutions

The current and non-current debts with credit institutions at 31 December 2019 are the following:

Thousands of euros

2019

				Outstanding
Type	Interest rate	Maturity	Par value	debt at
				31/12/2019
Bank borrowings	Eur+margin	14/02/2020	40,000	40,006
Bank borrowings	Eur+margin	27/02/2020	20,000	20,000
Bank borrowings	Eur+margin	12/03/2020	15,000	15,015
Loan agreement	Eur+margin	10/05/2020	10,000	8
Loan agreement	Eur+margin	04/11/2020	15,000	23
Loan agreement	Eur+margin	28/06/2020	5,000	6
Loan agreement	Eur+margin	31/07/2020	3,000	3
Loan agreement	Eur+margin	25/05/2020	5,000	567
Loan agreement	Eur+margin	12/10/2020	15,000	-
Loan agreement	Eur+margin	10/12/2020	5,000	7
Loan agreement	Eur+margin	04/11/2020	15,000	-
Total
			75,635

The current and non-current debts with credit institutions at 31 December 2018 are the following:

Thousands of euros

2018

				Outstanding
Type	Interest rate	Maturity	Par value	debt at
				31/12/2018
Bank borrowings	Jibar+margin	29/01/2020	18,296	16,969
Bank borrowings	Eur+margin	27/02/2019	15,000	15,000
Bank borrowings	Eur+margin	22/03/2019	15,000	15,000
Bank borrowings	Eur+margin	14/09/2019	15,000	15,000
Bank borrowings	Eur+margin	27/03/2019	15,000	15,000
Loan agreement	Eur+margin	28/04/2019	10,000	1,615
Loan agreement	Eur+margin	15/10/2019	15,000	10
Loan agreement	Eur+margin	31/07/2019	3,000	3
Loan agreement	Eur+margin	29/06/2019	5,000	5
Loan agreement	Eur+margin	10/05/2019	10,000	23
Loan agreement	Eur+margin	10/12/2019	5,000	8
Loan agreement	Eur+margin	25/05/2019	5,000	-
Loan agreement	Eur+margin	30/12/2019	5,000	-
Total
			78,633

Syndicated credit facility

On 10 February 2017, Prosegur Cash, S.A. arranged a new five-year syndicated credit facility of EUR 300,000 thousand to afford the Company long-term liquidity. As of 31 December 2019, there are EUR 20,000 thousand of available balance of this credit (as of 31 December 2018 there was no available balance associated with this credit).

The interest rate of the drawdowns under the syndicated credit facility is equal to Euribor plus an adjustable spread based on the Company's rating.

Additionally, this financing has the guarantees granted by the following subsidiaries of Prosegur Cash, S.A.: Prosegur Brasil, S.A. Transportadora de Valores e Segurança (Brazil), Transportadora de Caudales Juncadella, S.A. (Argentina) and Compañía de Seguridad Prosegur, S.A. (Peru). This contract has the following obligatory covenant ratios:

The net financial debt/EBITDA ratio should be less than 3.5.
The EBITDA/finance costs ratio should be higher than 5.

Payables to Group companies

The breakdown of the main characteristics of the debts as of 31 December 2019 is as follows (Note 18):

Thousands of euros

Type	Currency	Interest rate	Maturity	Par value	Current

Loans with group companies
Transportadora de Caudales Juncadella S.A.	EUR	0.75%	31/12/2020	30,554	30,554
Prosegur Brasil S/A Transportadora de Valores e Segurança	EUR	0.75%	31/12/2020	64,850	64,850
Compañia de Seguridad Prosegur SA	EUR	4.00%	31/12/2020	53	53
MIV Gestión SA	EUR	0.75%	31/12/2020	202	202
Prosegur Servicios de Efectivo España SLU	EUR	0.75%	31/12/2020	31,258	31,258
Prosegur Global CIT SLU	EUR	0.75%	31/12/2020	39,751	39,751
Armor Acquisition, S.A.	EUR	0.75%	31/12/2020	65,362	65,362
Juncadella Prosegur Internacional SA	EUR	0.75%	31/12/2020	217,464	217,464
Contesta Teleservicios SA	EUR	0.75%	31/12/2020	1,668	1,668
Integrum 2008 SLU	EUR	0.75%	31/12/2020	666	666
Bloggers Broker SL	EUR	0.75%	31/12/2020	1,402	1,402
Contesta Servicios Auxiliares SL	EUR	0.75%	31/12/2020	1,592	1,592
Prosegur Alpha3 Cashlabs SL	EUR	0.75%	31/12/2020	350	350
Prosegur Internationale Handels GmbH	EUR	0.75%	31/12/2020	3,011	3,011
Empresa de Transportes Cia de Seguridad Chile Ltda	EUR	0.75%	31/12/2020	2,863	2,863
Malcoff Holdings BV	EUR	0.75%	31/12/2020	100	100
Pitco Reinsurance SA	EUR	0.75%	31/12/2020	13,076	13,076
Other financial liabilities					474,222

MIV Gestión SA (**)	EUR		31/12/2020	3	3
Prosegur AVOS España SL (**)	EUR		31/12/2020	6	6
Armor Acquisition SA (**)	EUR		31/12/2020	535	535
Prosegur Global CIT ROW SLU (**)	EUR		31/12/2020	30,200	30,200
Singpai Alarms Private Ltd (**)	EUR		31/12/2020	2	2
Short-term payables to Group companies and associates					30,746

Prosegur Compañía de Seguridad S.A.	EUR			33,335	33,335
Prosegur Asset Management S.A.	EUR			14,053	14,053
					47,388
Total
				552,356

These balances are a consequence of the daily sweeping of cash-pooling accounts (Note 23) (**) Balance corresponding to the current account held with the Company

The breakdown of the main characteristics of the debts as of 31 December 2018 is as follows (Note 18):

Thousands of euros

Type	Currency	Interest rate	Maturity	Par value	Current

Loans with group companies
Transportadora de Caudales Juncadella S.A.	EUR	0.75%	31/12/2019	1,500	1,500
BIP Serviços de Vigilancia Patrimonial Ltda	EUR	0.75%	31/12/2019	11,956	11,956
Compañia de Seguridad Prosegur S.A.	EUR	2.50%	31/12/2019	1,480	1,480
Prosegur Servicios de Efectivo España S.L.U.	EUR	0.75%	31/12/2019	8,119	8,119
Armor Acquisition S.A.	EUR	0.75%	31/12/2019	70,050	70,050
Juncadella Prosegur Internacional, S.A.	EUR	0.75%	31/12/2019	301,144	301,144
Contesta Teleservicios S.A.	EUR	0.75%	31/12/2019	1,189	1,189
Integrum 2008 S.L.U.	EUR	0.75%	31/12/2019	553	553
Bloggers Broker S.L.	EUR	0.75%	31/12/2019	300	300
Contesta Servicios Auxiliares S.L.	EUR	0.75%	31/12/2019	715	715
Prosegur Servicios de Pago EP SLU	EUR	0.75%	31/12/2019	2	2
Prosegur Internationale Handels GmbH	EUR	0.75%	31/12/2019	2,526	2,526
Empresa de Transportes Cia de Seguridad Chile Ltda	EUR	3.75%	31/12/2019	8,594	8,594
Pitco Reinsurance SA	EUR	0.75%	31/12/2019	2,341	2,341
Other financial liabilities					410,469

Prosegur Servicios de Efectivo España, S.L.U. (**)	EUR		31/12/2019	28	28
Armor Acquisition, S.A. (**)	EUR		31/12/2019	47	47
Juncadella Prosegur Internacional, S.A. (**)	EUR		31/12/2019	237	237
Contesta teleservicios SAU (**)	EUR		31/12/2019	11	11
Prosegur Compañía de Seguridad S.A. (**)	EUR		31/12/2019	16	17
Short-term payables to Group companies and associates					340

Prosegur Compañía de Seguridad S.A.	EUR			45,154	45,154
Prosegur Asset Management S.A.	EUR			19,035	19,035
						64,189
Total
				474,998

These balances are a consequence of the daily sweeping of cash-pooling accounts (Note 23) (**) Balance corresponding to the current account held with the Company

Likewise, the heading "short-term payables to Group companies and associates" recognises the amounts due for dividends with the companies Prosegur Compañía de Seguridad, S.A. and Prosegur Asset Management, S.A.

Trade payables

The breakdown of balances with commercial creditors is as follows:

		Thousands of euros
Current	2019	2018

Suppliers, Group companies and associates (Note 18)	40,232	4,578
Sundry accounts payable	3,892	4,736
Personnel (salaries payable)	1,124	2,690
Total	45,248		12,004

The suppliers section contains the outstanding trademark billing. The Personnel section (salaries payable) includes the accrued incentive, payable in cash, corresponding to the 2017 and the 2020 Plans, for EUR 840 thousand (EUR 1,392 thousand in 2018) (Note 25.9).

The fair value of the incentives referred to the share quotation price was estimated on the basis of Prosegur Cash's share quotation price at the close of the period or at the payment time.

Classification by maturities

The classification of financial liabilities by maturities at 31 December 2019 is as follows:

			Thousands of euros
				2019
			Financial liabilities
	2020	2021	2022	2023	Subsequent		Total
	years

Debts with credit institutions	75,635	-	-	-	-	75,635
Debentures and other negotiable securities	8,872	-	-	-	593,306	602,178
Other financial liabilities (Note 5)	17,975	-	-	-	-	17,975
Payables to Group companies (Note 18)	552,356	-	-	-	-	552,356
Trade and other payables	-	-	-	-	-	-
Suppliers, Group companies and associates (Note 18)	40,232	-	-	-	-	40,232
Sundry accounts payable	3,892	-	-	-	-	3,892
Personnel (salaries payable)	1,124	-	-	-	-	1,124
Total
700,086	-	-	-	593,306		1,293,392

The classification of financial liabilities by maturities at 31 December 2018 is as follows:

			Thousands of euros
				2018
			Financial liabilities
	2019	2020	2021	2022	Subsequent		Total
	years

Debts with credit institutions	61,830	16,803	-	-	-	78,633
Debentures and other negotiable securities	8,872	-	-	-	592,438	601,310
Other financial liabilities	24,348	-	-	-	-	24,348
Loans to Group companies and associates	474,998	-	-	-	-	474,998
Trade and other payables	-	-	-	-	-
Suppliers, Group companies and associates	4,578	-	-	-	-	4,578
Sundry accounts payable	4,736	-	-	-	-	4,736
Personnel (salaries payable)	2,690	-	-	-	-	2,690
Total
582,052	16,803	-	-	592,438		1,191,293

Deferred payments to suppliers. Third additional provision. "Reporting Requirement", of Act 15/2010 of 5 July 2010

The information required by the "Reporting Requirement", third additional provision of Act 15/2010 of 5 July 2010 (modified through the Final Provision Two of Act 31/2014, of 3 December) prepared in accordance with the ICAC Resolution of 29 January 2016, on the information to be included in the annual accounts report in relation to the average period of payment to suppliers in commercial operations is detailed below.

		2019	2018
		Days
Average payment period to suppliers	59	52
Ratio of transactions paid	57	53
Ratio of transactions pending payment	76	46
		Amount
		Thousands of euros
Total payments made		23,530	11,462
Total payments pending	2,203	1,962

For the exclusive purposes of providing the disclosures envisaged in this Resolution, suppliers are deemed as commercial creditors holding debts for the supply of goods or services, included under "Suppliers and other payables" of current liabilities of the balance sheet.

"Average payment period to suppliers" is understood as the period between the delivery of the goods or the rendering of the services by the supplier and the material payment of the transaction.

The maximum legal term of payment applicable to the companies in 2019 and 2018, according to Act 11/2013, of 26 July, is of 30 days (unless the conditions set forth in the Act allowing the maximum payment period to be raised to 60 days are fulfilled).

15. Taxation

Details of balances with public entities are as follows:

						Thousands of euros
		2019		2018
			No	Current						No	Current
			Current						Current
Assets

Deferred tax assets	535			-	925		-
Value added tax and similar liabilities	-			3,971	-		4,742
						3,971				925		4,742
	535
Liabilities
Social Security	-			84	-		69
Withholdings	-			1,369	-		1,718
					1,453			-			1,787
	-

Prosegur Compañía de Seguridad, S.A.,the majority shareholder of the Company is the parent company of a group that is taxed Corporate Income Tax under the fiscal consolidation regime in Spain. As well as Prosegur Compañía de Seguridad, S.A. as the parent, this consolidated tax group comprises the Spanish subsidiaries that meet the requirements set out in regulations governing consolidated taxation.

Pursuant to tax legislation in force for 2016 and following years, the Company's tax loss carryforwards may only be offset up to a maximum of 25% of taxable income prior to offset.

On 27 November 2013, the Official State Gazette (BOE) published the modifications to the Corporate Income Tax Act, which establishes, among other aspects, the reduction over two years of the general Corporate Income Tax rate, which, as of 1 January 2016 was at 25%.

Due to the different interpretations that could be made of the fiscal legislation in force, additional tax liabilities could arise in the event of inspection. In any event, the Directors of the Company do not consider that any such liabilities that could arise would have a significant effect on the consolidated annual accounts.

Income tax

The reconciliation of the accounting result and the corporate income tax carry forward is as follows:

	Thousands of euros
Account finance income before tax	2019		2018
85,294	132,335
Permanent differences	(98,952)	(148,359)
Temporary differences:	(1,387)	(1,530)
- Originating in the current period	1,733	1,917
- Arising in previous years	(3,120)		(3,447)
Taxable base for tax consolidation	(15,045)	(17,553)
Tax rate	25%		25%
Resulting tax payable	(3,761)	(4,389)
Deductions:	(5,044)	(3,655)
- Double taxation	(4,235)	(3,588)
- Other deductions	(809)	(67)
Tax payable	(8,805)		(8,043)

The permanent differences to the accounting result for 2019 correspond to items that are not tax deductible expenses or taxable income, and mainly due to: the exemption of dividends received from its subsidiary Prosegur Global CIT ROW, S.L. for EUR 100,000 thousand, (2018: EUR 130,000 thousand for Prosegur Global CIT, S.L. and EUR 17,500 thousand for Prosegur Global CIT ROW, S.L.), EUR 58 thousand correspond to taxes paid abroad and which are not liable to deduction for international double taxation and contributions to foundations for a positive amount of EUR 1,106 thousand.

The main temporary difference adjustments to accounting profit originating in the year that are deductible in subsequent years are as follows:

1. Positive:

Provision for personnel expenses, amounting to EUR 1,668 thousand (EUR 1,852 thousand in 2018).
Other adjustments for EUR 65 thousand (EUR 65 thousand in 2018).

The main temporary difference adjustments to accounting profit originating in previous years are as follows:

1.Positive:

Application for an amount of EUR one thousand (EUR one thousand in 2018), corresponding to the reversal of the negative adjustment of items of fixed assets subject to the freedom to amortise for 2009, 2010 and 2011.

2.Negative:

Reversal of provisions from previous years amounting to EUR 3,119 thousand (EUR 3,448 thousand in 2018).

In 2019, the deductions correspond to the deduction for international double taxation in respect of taxes paid abroad for various services amounting to EUR 4,235 thousand (EUR 3,558 thousand in 2018), and deduction in technological innovation of EUR 422 thousand (EUR 67 thousand in 2018) and the deduction due to donations to non-profit companies for EUR 387 thousand.

The breakdown of the income tax expense of the income statement is as follows:

	Thousands of euros
Account finance income before tax	2019		2018
85,294	132,335
Permanent differences	(98,952)	(148,359)
Elimination of own shares transactions	1	(11)
Taxable base	(13,657)	(16,034)
Tax rate	25%	25%
Resulting tax payable	(3,414)	(4,009)
Deductions:	(5,044)	(3,655)
- Double taxation	(4,235)	(3,588)
- Other deductions	(809)	(67)
Expense (income) from tax on profit	(8,458)	(7,664)
Withholdings at source and other	4,267	4,381
Final expense (income) from tax on profit	(4,191)		(3,283)

The corporate income tax expense is as follows:

	Thousands of euros
	2019		2018
Current tax	(8,805)	(8,043)
Elimination of own shares transactions	-	(4)
Deferred tax	347	383
Adjustments from previous years	4,267	4,381
	(4,191)		(3,283)

On 28 November 2016, by agreement of the then sole shareholder of the company Prosegur Cash, S.A., the company's admission was approved to the special regime of the Entities for the Holding of Foreign Securities provided for in Act 27/2014, of 27 November, on Corporate Income Tax. This was duly communicated to the Administration in a timely manner.

There were no restructuring operations during the 2018 and 2019 financial years.

The difference in value in both cases derives from the accounting entries at consolidated value of the acquired assets.

List of tax benefits of the transferring entity, with respect to which the entity must assume compliance with certain requirements in accordance with art. 84 LIS: not benefited.

Deferred taxes

Tax assets and tax liabilities are offset when the Company currently has the legally enforceable right to offset the recognised amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

Movement in deferred tax is as follows:

				Thousands of euros
			Opening	Other	Disposals	Additions	Closing
Deferred tax assets	balance	adjustments	balance


Intangible asset amortisation	64	16	-	16	96
Other provisions	861	(59)	(363)	-	439
			925	(43)	(363)	16	535
				Thousands of euros
			Opening	Other	Disposals	Additions	Closing
			balance	adjustments	balance
Deferred tax liabilities

Freedom to amortise		1,102	206	-	(383)	925
			1,102	206	-	(383)	925

16. Contingencies

Contingent liabilities

The Company has contingent liabilities from litigation arising in the ordinary course of business which are not expected to give rise to significant liabilities.

The Company has contingent liabilities for bank and other guarantees related with its normal business operations that are not expected to give rise to any significant liabilities.

Guarantees provided by the Company to third parties at year end are as follows:

Thousands of euros

	2019		2018
Financial guarantees	37	37
	37		37

Financial guarantees essentially include those relating to litigations in process.

Contingent assets

At 31 December 2019 and 2018 the Company has no contingent assets.

National Commission on Markets and Competition

On 22 April 2015, Spain's National Commission on Markets and Competition (hereinafter, the CNMC) commenced disciplinary proceedings against Prosegur, Prosegur Servicios de Efectivo España, S.L.U (currently a subsidiary of Prosegur Cash) and Loomis España, S.A. for alleged anticompetitive practices in accordance with European Union legislation. On 10 November 2016, the CNMC's Competition Chamber ruled to fine Prosegur and its subsidiary EUR 39,420 thousand.

On 13 January 2017, Prosegur announced it planned to file, in the National Court (Audiencia

Nacional), a contentious-administrative appeal against said ruling and requested the adoption of an interim measure consisting of suspending payment of the fine imposed.

On 13 February 2017, the National Court accepted the appeal proposed by Prosegur for processing, commencing the relevant proceedings, prior to formal filing of the appeal. On 6 September 2018, Prosegur filed the relevant appeal which at present remains pending resolution by the National Court in respect of the underlying matter.

With regard to the request for the interim measure, on 31 March 2017, the National Court agreed to it and suspended execution of the CNMC resolution in particular concerning payment of the fine by Prosegur, on the condition that, within a maximum of two months, Prosegur should provide surety or any other guarantee in the amount of the fine. On 9 June 2017, Prosegur presented the National Court with a bank guarantee amounting to EUR 39,420 thousand.

Prosegur will undertake solely and at its own expense the defence of Prosegur and Prosegur Servicios de Efectivo España, S.L. with regard to the disciplinary proceedings and the resolution by the Competition Chamber of the CNMC on 10 November 2016, with exclusive powers in respect of the supervision and control of said defence and of the contentious-administrative proceedings. Prosegur will hold Prosegur Cash and its subsidiary harmless from the potential negative economic effects of said proceedings.

17. Commitments

Purchase commitments for fixed assets

At 31 December 2019, the commitments correspond mainly to the purchase of hardware and software development amounting to EUR 114 thousand (EUR 622 thousand at 31 December 2018).

Operating lease commitments

At 31 December 2019, the commitments correspond mainly to the rental of vehicles under non- cancellable operating leases amounting to EUR 26 thousand (EUR 102 thousand at 31 December 2018).

18. Balances and transactions with related parties

Related Party Balances

The breakdown of the balances by categories is the following:

						Thousands of euros
					2019
		Revenue from		Financial				Expenses
				Provision of services		from	Services
		dividends		income (Note
				(Note 3)		interest	rendered
		(Note 3)	3)
					(Note 4)

Prosegur Soluciones Integrales de Seguridad España SLU		-	-	-	-	(113)
Prosegur Compañia de Seguridad, S.A.	-	-	-	-	(23,391)
Prosegur Gestion de Activos, S.L.U.	-	-	-	-	(30,980)
MIV Gestión, S.A.	-	11	83	-	-
Prosegur Ciberseguridad SL	-	-	-	-	-
Prosegur Global SIS SLU	-	-	-	-	-
Prosegur Servicios de Efectivo España SLU	-	-	4,928	(176)	-
Prosegur Global CIT, S.L.U.	-	38	31,515	-	-
Prosegur Colombia 3, S.L.	-	8	-	-	-
Prosegur Avos España, S.L.U.	-	233	209	-	(12)
Armor Acquisition, S.A.	-	-	-	(531)	-
Juncadella Prosegur Internacional SA	-	-	-	(2,342)	-
Prosegur International CIT 1, S.L.	-	15	-	-	-
Prosegur Global CIT ROW, S.L.U.	100,000	-	14,118	(20)	-
ESC Servicios Generales SLU	-	-	-	-	(4)
Contesta Teleservicios SA	-	-	-	(16)	-
Integrum 2008 SLU	-	-	-	(5)	-
Bloggers Broker SL	-	-	-	(3)	-
Contesta Servicios Auxiliares SL	-	-	218	(9)	-
Prosegur Colombia 1 SLU	-	36	-	-	-
Prosegur Colombia 2 SLU	-	36	-	-	-
Risk Management Solutions SLU	-	4	173	-	-
Compliofficer SLU	-	1	-	-	-
Work 4 Data Lab SL	-	3	-	-	-
Enclama SL	-	2	-	-	-
Prosegur Alpha3 Cashlabs SL	-	6	-	-	-
Transportadora de Caudales Juncadella SA	-	-	11,897	(157)	(850)
Prosegur Serviços e Participaçoes Societarias SA	-	-	53	-	-
Prosegur Brasil S/A Transportadora de Valores e Segurança	-	-	1,459	(103)	(3,106)
Compañia Transportadora de Valores Prosegur de Colombia S	-	-	48	-	-
Consultoría de Negocios CCR Consulting Costa Rica SA	-	-	273	-	-
Compañía de Seguridad Prosegur, S.A.	-	-	2,931	(52)	-
Prosegur Cajeros, S.A.	-	-	114	-	-
Prosegur Gestion de Activos SA	-	-	-	-	(14)
Prosegur Cash Holding France SAS	-	182	-	-	-
Prosegur Internationale Handels GmbH	-	-	-	(4)	-
Prosegur Cash Services Germany GmbH	-	101	-	-	-
SIS Cash Services Private Ltd	-	-	-	-	-
Servicios Prosegur Ltda	-	-	1,180	-	-
Empresa de Transportes Cia de Seguridad Chile Ltda	-	-	-	(60)	-
Prosegur Seguridad Privada Logistica y Gestion de Efectivo SA	-	16	-	-	-
de CV

Grupo Mercurio de Transportes SA de CV	-	-	80	-	-
Pitco Reinsurance, S.A.	-	-	-	(119)	-
Luxpai CIT SARL	-	2	-	-	-
Prosegur Logistica e Tratamento de Valores Portugal SA	-	-	(7)	-	-
Armored Transport Plus Incorporated	-	14	-	-	-
Singpai Pte Ltd	-	-	-	-	(626)
Singpai Alarms Private Ltd	-	-	-	-	(71)
Prosegur Transportadora de Caudales SA	-	112	-	-	-
Prosegur Paraguay, S.A.	-	-	1,192	-	-
Prosegur Australia Holdings PTY Limited	-	-	-	-	(24)
Prosegur Australia Investments PTY Limited	-	670	-	-	-
Prosegur Australia Pty Limited	-	-	-	-	(20)
Total		100,000	1,490	70,464	(3,597)	(59,211)

					Thousands of euros
				2018
			Financial assets				Financial liabilities
			Current						Current
	Credits		Debtors (Note		Other financial		Debts (Note		Suppliers		Other financial
	(Note 9)	9)		assets (Note	13)		(Note 13)		liabilities (Note
	13)		13)

Group Companies

Prosegur SIS España, S.L.	-	-	-	-	(2)	-
Prosegur Compañia de Seguridad, S.A.	-	13	9,864	(45,154)	(3,008)	(17)
Prosegur Gestion de Activos, S.L.U.	-	2	-	-	(11)	-
Prosegur Global Alarmas, S.L.U.	830	-	-	-	-	-
MIV Gestión, S.A.	-	-	1	-	-	-
Prosegur Assets Management, S.L.U.	-	-	-	(19,035)	-	-
Prosegur Servicios de Efectivo España, S.L.U.	-	1	-	(8,119)	(6)	(28)
Prosegur Global CIT, S.L.U.	126,860	505	93	-	-	-
Prosegur Berlin SLU	93	-	-	-	-	-
Prosegur Avos España, S.L.U.	31,071	-	20	-	(14)	-
Armor Acquisition, S.A.	-	-	-	(70,050)	-	(47)
Juncadella Prosegur Internacional, S.A.	-	-	-	(301,144)	-	(237)
Prosegur International CIT 1, S.L.	873	-	-	-	-	-
Prosegur International CIT 2 SLU	5,091	-	3	-	-	-
Prosegur Global CIT ROW, S.L.U.	47,105	255	43	-	-	-
Contesta Teleservicios	-	-	-	(1,189)	-	(11)
Integrum 2008	-	-	-	(553)	-	-
Bloggers Brokers	-	-	-	(300)	-	-
Contesta Servicios Auxiliares	-	-	-	(715)	-	-
Prosegur Colombia 1 SLU	4,865	-	-	-	-	-
Prosegur Colombia 2 SLU	4,866	-	3	-	-	-
Prosegur Servicios de Pago EP SLU	-	-	-	(2)	-	-
Transportadora de Caudales Juncadella SA	-	10,635	-	(1,500)	(74)	-
Prosegur Argentina PGA	-	-	-	-	(91)	-
Prosegur Brasil S/A Transportadora de Valores e Segurança	-	4,260	-	(11,956)	(506)	-
Prosegur Procesos SAS	-	4	-	-	-	-
Compañía de Seguridad Prosegur, S.A.	-	38	-	(1,480)	-	-
Prosegur Gestion de Activos SA	-	-	-	-	(1)	-
Prosegur Cash Holding France SAS	14,344	-	379	-	-	-
Prosegur Traitment de Valeurs Azur SA	-	199	-	-	-	-
Prosegur Traitement de Valeurs Provence, SAS	-	-	-	-	(8)	-
Prosegur Internationale Handels GmbH	-	-	-	(2,526)	-	-
Prosegur Cash Services Germany GmbH	11,145	2,096	-	-	-	-
SIS Cash Services Private Ltd	-	22	-	-	-	-
Servicios Prosegur Ltda	-	-	-	-	(4)	-
Empresa de Transportes Cia de Seguridad Chile Ltda	-	-	-	(8,594)	-	-
Prosegur Seguridad Privada Logistica y Gestion de	48	-	-	-	-	-
Efectivo SA de CV

Grupo Mercurio de Transportes SA de CV	-	71	-	-	-	-
Pitco Reinsurance SA	-	-	-	(2,341)	-	-
Luxpai CIT SARL	450	-	-	-	(426)	-
Prosegur Logistica e Tratamento de Valores Portugal SA	-	1	-	-	-	-
Prosegur Global Resources Holding Philipines Incorporated	-	-	10,477	-	-	-
Singpai Pte Ltd	-	-	-	-	(427)	-
Prosegur Transportadora de Caudales SA	2,944	-	-	-	-	-
Prosegur Paraguay, S.A.	-	23	-	-	-	-
Prosegur Australia Investments PTY Limited	17,115	-	-	-	-	-
Total
267,700		18,125		20,883		(474,658)		(4,578)		(340)

Receivables and suppliers mostly reflect the outstanding balances relating to invoices for centralised services issued to and received from, respectively, the various Group companies.

Financial assets - the loans correspond, on the one hand, to short-term loans delivered to Group companies within the framework of the centralised treasury management. These are denominated in EUR, accruing annual interest of 0.75% in Spain (0.75% in 2018), of 2.25 % in France (3.25% in 2018), 1% in Germany (1% in 2018) and 1% in Luxembourg (0.75% in 2018). We also found short- term loans granted to subsidiaries in Australia in AUD and in Uruguay in EUR, accruing annual interest 3.75 % in Australia (3.50% in 2018) and 4.00 % in Uruguay (5.00% in 2018). Interest accrued amounted to EUR 1,490 thousand in 2019 (EUR 2,886 thousand in 2018).

Financial liabilities - the debts correspond, on the one hand, to short-term loans received from Group companies within the framework of the centralised treasury management. They are denominated mainly in EUR, accruing annual interest of 0.5% in Germany (0.75% in 2018). On the other hand, we find short-term loans denominated in EUR granted by subsidiaries in Luxembourg accruing an interest rate of 0.75% to the Company; Argentina of 0.75%, Brazil of 0.75%, Peru of 4%, and Chile of 0.75% (2018: 1% in Luxembourg, 1% in Argentina, 0.75% in Brazil, 2.50% in Peru, and 0.75% in Chile). Interest accrued amounted to EUR 3,597 thousand in 2019 (EUR 4,520 thousand in 2018).

Related Party Transactions

The amounts of the Company's transactions with related parties are the following:

							Thousands of euros
						2019
			Revenue from		Financial		Provision of services		Expenses	Services
						from
			dividends		income (Note
					(Note 3)		interest	rendered
			(Note 3)	3)
						(Note 4)

Prosegur Soluciones Integrales de Seguridad España SLU		-	-	-	-	(113)
Prosegur Compañia de Seguridad, S.A.	-	-	-	-	(24,076)
Prosegur Gestion de Activos, S.L.U.	-	-	-	-	(30,980)
MIV Gestión, S.A.	-	11	83	-	-
Prosegur Ciberseguridad SL	-	-	-	-	-
Prosegur Global SIS SLU	-	-	-	-	-
Prosegur Servicios de Efectivo España SLU	-	-	4,928	(176)	-
Prosegur Global CIT, S.L.U.	-	38	31,515	-	-
Prosegur Colombia 3, S.L.	-	8	-	-	-
Prosegur Avos España, S.L.U.	-	233	209	-	(12)
Armor Acquisition, S.A.	-	-	-	(531)	-
Juncadella Prosegur Internacional SA	-	-	-	(2,342)	-
Prosegur International CIT 1, S.L.	-	15	-	-	-
Prosegur Global CIT ROW, S.L.U.	100,000	-	14,118	(20)	-
ESC Servicios Generales SLU	-	-	-	-	(4)
Contesta Teleservicios SA	-	-	-	(16)	-
Integrum 2008 SLU	-	-	-	(5)	-
Bloggers Broker SL	-	-	-	(3)	-
Contesta Servicios Auxiliares SL	-	-	218	(9)	-
Prosegur Colombia 1 SLU	-	36	-	-	-
Prosegur Colombia 2 SLU	-	36	-	-	-
Risk Management Solutions SLU	-	4	173	-	-
Compliofficer SLU	-	1	-	-	-
Work 4 Data Lab SL	-	3	-	-	-
Enclama SL	-	2	-	-	-
Prosegur Alpha3 Cashlabs SL	-	6	-	-	-
Transportadora de Caudales Juncadella SA	-	-	11,897	(157)	(850)
Prosegur Serviços e Participaçoes Societarias SA	-	-	53	-	-
Prosegur Brasil S/A Transportadora de Valores e Segurança	-	-	1,459	(103)	(2,421)
Compañia Transportadora de Valores Prosegur de Colombia S	-	-	48	-	-
Consultoría de Negocios CCR Consulting Costa Rica SA	-	-	273	-	-
Compañía de Seguridad Prosegur, S.A.	-	-	2,931	(52)	-
Prosegur Cajeros, S.A.	-	-	114	-	-
Prosegur Gestion de Activos SA	-	-	-	-	(14)
Prosegur Cash Holding France SAS	-	182	-	-	-
Prosegur Internationale Handels GmbH	-	-	-	(4)	-
Prosegur Cash Services Germany GmbH	-	101	-	-	-
SIS Cash Services Private Ltd	-	-	-	-	-
Servicios Prosegur Ltda	-	-	1,180	-	-
Empresa de Transportes Cia de Seguridad Chile Ltda	-	-	-	(60)	-
Prosegur Seguridad Privada Logistica y Gestion de Efectivo SA	-	16	-	-	-
de CV

Grupo Mercurio de Transportes SA de CV	-	-	80	-	-
Pitco Reinsurance, S.A.	-	-	-	(119)	-
Luxpai CIT SARL	-	2	-	-	-
Prosegur Logistica e Tratamento de Valores Portugal SA	-	-	(7)	-	-
Armored Transport Plus Incorporated	-	14	-	-	-
Singpai Pte Ltd	-	-	-	-	(626)
Singpai Alarms Private Ltd	-	-	-	-	(71)
Prosegur Transportadora de Caudales SA	-	112	-	-	-
Prosegur Paraguay, S.A.	-	-	1,192	-	-
Prosegur Australia Holdings PTY Limited	-	-	-	-	(24)
Prosegur Australia Investments PTY Limited	-	670	-	-	-
Prosegur Australia Pty Limited	-	-	-	-	(20)
Total		100,000	1,490	70,464	(3,597)	(59,212)

					Thousands of euros
				2018
	Revenue from		Financial		Provision of services		Expenses	Services
	dividends		income (Note			from
			(Note 3)		rendered
	(Note 3)		3)			interest

Prosegur Soluciones Integrales de Seguridad España SLU	-	-	-	-	(7)
Prosegur Compañia de Seguridad, S.A.	-	-	-	-	(28,697)
Prosegur Gestion de Activos, S.L.U.	-	-	-	-	(28,219)
MIV Gestión, S.A.	-	5	76	-	-
Prosegur Ciberseguridad SL	-	-	-	-	(20)
Prosegur Global SIS SLU	-	-	-	-	(3)
Prosegur Servicios de Efectivo España SLU	-	-	4,734	(471)	(37)
Prosegur Global CIT, S.L.U.	130,000	1,017	28,905	-	-
Prosegur BPO España, S.L.U.	-	99	451	-	(3)
Armor Acquisition, S.A.	-	-	-	(542)	-
Juncadella Prosegur Internacional SA	-	-	-	(2,679)	(1)
Prosegur Global CIT ROW, S.L.U.	17,500	570	13,237	-	(12)
Prosegur International CIT 1, S.L.	-	5	-	-	-
Inversiones CIT 2 SLU	-	15	-	-	-
Prosegur Global SIS ROW, S.L.U.	-	-	-	-	(1)
ESC Servicios Generales SLU	-	-	-	-	(2)
Contesta Teleservicios SA	-	-	-	(11)	-
Integrum 2008 SLU	-	-	-	(3)	-
Bloggers Broker SL	-	-	-	(1)	-
Contesta Servicios Auxiliares SL	-	-	-	(2)	-
Prosegur Colombia 2 SLU	-	2	-	-	-
Transportadora de Caudales Juncadella SA	-	-	10,613	(565)	(214)
Prosegur Argentina SA	-	-	-	-	(1,045)
Prosegur Brasil S/A Transportadora de Valores e Segurança	-	-	4,260	(1)	(875)
Segurpro Vigilancia Patrimonial SA	-	-	-	-	(2)
Prosegur Procesos SAS	-	-	4	-	-
Compañía de Seguridad Prosegur, S.A.	-	132	2,636	(2)	-
Prosegur Gestion de Activos SA	-	-	-	-	(3)
Prosegur Cash Holding France SAS	-	379	-	-	-
Prosegur Traitment de Valeurs Azur SA	-	-	199	-	-
Prosegur Traitement de Valeurs Provence, SAS	-	-	(8)	-	-
Prosegur Internationale Handels GmbH	-	-	-	(2)	-
Prosegur Cash Services Germany GmbH	-	119	2,096	-	(1)
SIS Cash Services Private Ltd	-	-	21	-	-
Servicios Prosegur Ltda	-	-	1,344	-	-
Empresa de Transportes Cia de Seguridad Chile Ltda	-	-	-	(94)	-
Prosegur Seguridad Privada Logistica y Gestion de Efectivo SA	-	6	-	-	-
de CV

Grupo Mercurio de Transportes SA de CV	-	-	147	-	-
Luxpai Holdo SARL	-	-	-	-	(426)
Pitco Reinsurance, S.A.	-	-	-	(161)	-
Luxpai CIT SARL	-	123	-	-	-
Prosegur Logistica e Tratamento de Valores Portugal SA	-	-	182	15	-
Singpai Pte Ltd	-	-	-	-	(427)
Prosegur Transportadora de Caudales SA	-	140	-	-	-
Prosegur Paraguay, S.A.	-	-	1,428	-	-
Prosegur Australia Investments PTY Limited	-	275	-	-	-
Total	147,500	2,887	70,325	(4,519)	(59,995)

The most relevant transactions with related parties during the 2019 and 2018 are as follows:

Billing related to centralised services, with the related companies Prosegur Global CIT, S.L.U. and Prosegur Global CIT ROW, S.L.U., by virtue of which a service provision of EUR 45,634 thousand is recorded in 2019 (EUR 42,142 thousand in 2018). Also recorded for centralised

services are services received of EUR 34,910 thousand in 2019 (EUR 31,537 thousand in 2018).

Billing for trademark assignment, with different related companies across the world, under which EUR 23,391 thousand are billed in 2019 (EUR 28,697 thousand in 2018). Likewise, billing received for trademark assignment of EUR 23,391 thousand in 2019 (EUR 28,697 thousand in 2018) was recorded.

Interest income and borrowing costs reflect the amounts accrued on the aforementioned current loans extended to and by Group companies (Note 14).

19. Remuneration of Directors and Senior Management Personnel

Remuneration of members of the board of directors

The Board of Directors is understood to be the management group of the Company and is made up of persons elected by the General Shareholders' Meeting to carry out the management, control, representation and management functions of the same.

The members of the Board of Directors have received the following remuneration from the Company:

	Thousands of euros
	2019		2018
Fixed remuneration	1,270	1,044
Variable remuneration	572	413
Remuneration in kind	120	53
Insurance premium	136		3
Total	2,098	1,513

Remuneration of senior management personnel

Senior management personnel are Company employees who hold, de facto or de jure, senior management positions reporting directly to the Board of Directors, executive committees or managing directors on the Board, including those with power of attorney not limited to the Company's statutory activity or specific areas or matters.

The members of Senior Management have received the following remunerations from the Company:

			Thousands of euros
			2019		2018
Fixed remuneration	467	1,257
Variable remuneration	1,017	445
Remuneration in kind	11	117
Per diems		1		126
Total			1,496		1,945

These provisions include the accrued cash incentive corresponding to the 2017 and 2020 Plan.

During the year, provisions to profit/(loss) amounted to EUR 840 thousand (EUR 1,852 thousand in 2018).

The fair value of the incentives referred to the share quotation price was estimated on the basis of Prosegur's share quotation price at the close of the period or at the payment time.

There has been no accrued expense for Senior Management civil liability insurance in 2019 and 2018.

Information required by article 229 of the Spanish Companies Act

As required by articles 228, 229 and 230 of the Revised Text of the Spanish Companies Act, approved by Royal Legislative Decree 1/2010 of 2 July 2010 and amended by Act 31/2014 concerning improvements to corporate governance, the members of the Board of Directors and their related parties declare that they have not been involved in any direct or indirect conflicts of interest with the Company in 2019.

In 2019, Euroforum Escorial, S.A. (controlled by Gubel, S.L.) invoiced Prosegur Cash EUR 71 thousand for hotel services (EUR 5 thousand at 31 December 2018).

Prosegur is controlled by Gubel S.L., which was incorporated in Madrid, and holds 50.075% of the share capital of Prosegur, which consolidates Prosegur Cash in its consolidated financial statements.

Proactinmo, S.L. (controlled by Gubel S.L.) billed services for leasing a property on Calle San Máximo to Prosegur Cash for EUR 677 thousand (no billing was received for services from Proactinmo S.L. in 2018).

J&A Garrigues, S.L.P. billed occasional legal services to Prosegur Cash for EUR 135 thousand (no billing was received for services from J&A Garrigues S.L.P. in 2018).

Moreover, Mr Christian Gut Revoredo and Mr Antonio Rubio Merino respectively hold the posts of Executive Director of Prosegur and Executive President of Prosegur Cash and Chief Financial Officer of Prosegur and Proprietary Director (representing Prosegur) at Prosegur Cash. Ms Chantal Gut Revoredo is a Proprietary Director at Prosegur and Prosegur Cash. The Board of Directors considers that their respective posts at Prosegur in no way affect their independence when discharging their duties at Prosegur Cash.

20. Employee Information

The average headcount of the Company is as follows:

			2019	2018
Average headcount of the Company	41	42
Total			41		42

The distribution of the Company's personnel at the end of the year by gender and category is as follows:

	2019			2018
Analyst		Women			Men			Women		Men
1			8	-		7
Administrative Assistant	1			-	1		-
Director	-			4	-		4
General Director	-			-	-		1
Technical Director	-			1	-		1
Manager	-			1	-		1
Head of Second	-			1	-		1
Management Secretary	1			-	1		-
Level 1 Officer	-			2	-		1
Medium Qualified	1			1	1		13
High Qualified	8			13	8		-
Total		12			31		11		29

There are no employees in the Company with a disability rating of 33% or more.

The distribution by gender of the Board of Directors and Senior Management at the end of the year is as follows:

	2019		2018
Directors	Women		Men		Women			Men
3		6	3			6
Senior Management	2		9	2			9
Total	5		15		5			15

21. Audit Fees

KPMG, the auditors of the Annual Accounts of the Company, have invoiced the following fees and expenses for professional services:

	Thousands of euros
Audit services	2019	2018
202	207
Total	202	207

Audit services detailed in the above table include the total fees for services rendered in 2019 and 2018, irrespective of the date of invoice.

Additionally, other KPMG International affiliates have invoiced the Company the following fees for professional services during the year:

In the year 2019 and 2018, KPMG Auditors provided other services related to the audit for EUR 20 thousand (in 2019 and 2018).

22. Environmental information

At 31 December 2019 and 2018, the Company has no environment-related contingencies, legal claims or income and expenses relating to the environment.

23. Financial risk management

Financial risk factors

The Company's activities are exposed to various financial risks: market risk (including interest rate risk), credit risk and liquidity risk. The Company's risk management programme focuses on uncertainty in the financial markets and aims to minimise potential adverse effects on the Company's business.

(i) Currency risk

The Company mainly operates on a national basis. Likewise, the Prosegur Cash Group, of which the Company is the parent, operates internationally. As a result, the Company is exposed to currency risk when operating with its subsidiaries in foreign currencies and through the assets and liabilities contracted in foreign currencies from third parties. Currency risk is associated with recognised assets and liabilities denominated in foreign currency.

Management has a currency risk management policy to control the risk arising from the exchange of foreign currencies to its functional currency to minimise the Company's exposure. Currency risk arises when future transactions or recognised assets and liabilities are presented in a currency other than the parent's functional currency.

When so required by its policies and market expectations, the Company uses forward contracts approved and contracted by the Treasury Department in the corresponding market to control currency risk arising on trade transactions and recognised assets and liabilities. The Treasury Department is responsible for managing the net position of each foreign currency by entering into external or local forward currency contracts, depending on their competitiveness and appropriateness.

Since the Company, as parent of the Prosegur Cash Group, intends to remain in the foreign markets in which it is present in the long term or permanently, it does not hedge the currency risk related to equity investments in those markets.

The value of the financial assets and liabilities attributable to the Company at 31 December, by type of currency, is as follows:

					Thousands of euros
	2019		2018
		Assets			Liabilities		Assets		Liabilities
Euros	127,536			1,292,838	279,235	1,189,815
US Dollar	7,026			-	10,504	-
Australian Dollar	3,479			-	-	-
Peruvian Nuevo Sol	-			-	-	1,478
South African Rand	-			-	17,125	-
Mexican Peso	-			-	346	-
Other currencies	3,944			-	-	-
Total					1,292,838	307,210		1,191,293
141,985

(ii) Interest rate, cash flow and fair value risks

As the Company does not have a significant amount of assets remunerated at variable interest rates, income and cash flows from operating activities are not basically by fluctuations in market interest rates.

Interest rate risk mainly arises from non-current borrowings. Borrowings at variable interest rates expose the Company to cash flow interest rate risks. Fixed-interest borrowings expose the Company to fair value interest rate risks. In 2019 the Company's borrowings at variable interest rates were denominated in EUR.

The Company analyses its interest rate risk exposure dynamically. A simulation of various scenarios, considering refinancing, the renewal of current positions, alternative financing and hedges is performed. Based on these scenarios, the Company calculates the effect of a certain variation in interest rates on profit and loss. These scenarios are only analysed for the liabilities that represent the most significant positions in which a variable interest rate is paid.

Details of loans and borrowings, indicating the portion considered to be hedged, at a fixed rate, are as follows:

	Thousands of euros
	2019
	Total debt		Hedged debt
Non-current (Note 13)
593,306		593,306
Current (Note 13)	83,940	51,196
Total debt	677,246		644,502
	Thousands of euros
	2018
	Total debt		Hedged debt
Non-current (Note 13)
609,241	609,241
Current (Note 13)	70,702	55,330
Total debt	679,943		664,571

(iii) Credit risk

The Company has no significant credit risk concentrations given that the main activity of the Company corresponds to group companies.

(iv) Liquidity risk

The Company applies a prudent policy to cover its liquidity risks, based on having sufficient cash and marketable securities as well as sufficient financing through credit facilities to settle market positions. Given the dynamic nature of its underlying business, the Company's Treasury Department aims to be flexible with regard to financing.

Management monitors the Company's liquidity reserve forecasts, which comprise credit drawdowns and available cash, and are forecast based on expected cash flows.

The table below presents an analysis of the financial liabilities that will be settled for the net amount, grouped by maturities based on the period remaining from the balance sheet date until contractual maturity dates. The amounts presented in this table reflect the cash flows stipulated in the contract.

					Thousands of euros
		Less than 1		1 to 2 years			2 to 5 years	More than 5	Total
		year				years

31 December 2019	73,944	-	-			-	73,944

Finally, systematic forecasts are prepared for cash generation and requirements, allowing the Company to determine and monitor its liquidity position on an ongoing basis.

24. Events after the reporting date

No subsequent events have taken place following the close of 2019 of any significant relevance to these Annual Accounts.

25. Accounting principles

25.1 Intangible assets

The assets in intangible assets are posted at purchase price or production cost. The capitalisation of production cost appears under "Self-constructed assets" in the income statement. Intangible fixed assets are shown in the balance sheet at cost value less the amount of accumulated depreciation and impairment.

The costs incurred in carrying out activities that contribute to the development of the value of the Company's business as a whole, such as goodwill, trademarks and similar items generated internally, as well as the establishment expenses are recorded as expenses in the income statement as they are incurred.

Computer Software:

Computer software licences purchased from third parties are capitalised at the cost of acquisition or cost of preparation of the specific software for use. Such costs are amortised over the estimated useful lives of the applications, at 5 years.

Computer software maintenance costs are charged as expenses when incurred.

Patents, licences, trademarks and others:

Licences have finite useful lives and are recognised at cost less accumulated amortisation and impairment. Licences are amortised on a straight-line basis to allocate the cost over their estimated useful lives of between one and 10 years.

Other Intangible assets:

Other intangible assets mainly comprise the set of knowledge and technical resources of the personnel acquired from Prosegur Compañía de Seguridad, S.A. (Note 6) They are amortised on a straight-line basis over their estimated useful life of between two and 10 years.

25.2 Property, plant and equipment

Property, plant and equipment are recognised at cost of acquisition or production, less accumulated depreciation and any accumulated impairment.

Costs incurred to extend, modernise or improve property, plant and equipment are only recorded as an increase in the value of the asset when the capacity, productivity or useful life of the asset is increased and it is possible to ascertain or estimate the carrying amount of the assets that have been replaced in inventories.

The cost of major repairs is capitalised and depreciated over their estimated useful life, while recurring maintenance costs are charged to income statement during the year in which they are incurred.

Depreciation of property, plant and equipment is calculated systematically on a straight-line basis over the estimated useful lives of the assets based on the actual decline in value and use.

The Company uses the following depreciation rates:

	Depreciation rate
Other Installations	10%
Furniture	10%
Data processing equipment	25%
Other Property, Plant and Equipment	10% to 20%

The residual values and useful lives of assets are reviewed and adjusted, if necessary, at each balance sheet date.

When an asset's carrying amount exceeds its estimated recoverable amount, the carrying amount is written down immediately to the recoverable amount.

Profit and losses on the sale of property, plant and equipment are calculated as the difference between the consideration received and the carrying amount, and are recognised in the income statement.

25.3 Impairment Losses on Non-financial Assets

Assets subject to amortisation or depreciation are tested for impairment whenever an event or change in circumstances indicates that their carrying amount might not be recoverable.

An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount, which is the higher of fair value less costs to sell and value in use.

For impairment testing purposes, assets are grouped at the lowest level for which separate identifiable cash flows can be identified (cash-generating unit, CGU).

Non-financial assets for which impairment losses have been recognised, are tested at each balance sheet date in case the loss has reversed.

25.4 Financial assets

Investments in equity instruments of Group companies, jointly controlled companies and associates

These investments are initially recognised at cost, which is equivalent to the fair value of the consideration paid, including for jointly controlled companies and associates the transaction costs incurred, and are subsequently measured at cost net of any accumulated impairment losses. However, for investments made prior to classification as a Group company, jointly controlled company or associate, the cost of the investment is considered to be the carrying amount immediately before this classification. Valuation adjustments previously recognised in equity remain in equity until the investment is derecognised.

If there is objective evidence that the carrying amount is not recoverable, the amount of the impairment loss is measured as the difference between the carrying amount and the recoverable amount, the latter of which is understood as the higher of the fair value less costs to sell and the present value of estimated future cash flows from the investment. Unless there is better evidence of the recoverable amount of the investment, when estimating the impairment of these types of assets, the investee's equity is taken into consideration, corrected for any unrealised gains existing at the measurement date. Impairment losses are recognised and reversed in the income statement.

Loans and receivables:

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. The assets are classified as current unless they mature in more than 12 months after the balance sheet date, in which case they are classified as non-current.

These financial assets are initially carried at fair value, including directly attributable transaction costs, and are subsequently measured at amortised cost, recognising accrued interest at the effective interest rate, which is the discount rate that matches the instrument's carrying amount with all estimated cash flows to maturity. Nevertheless, trade receivables falling due in less than one year are carried at their face value on both initial recognition and subsequent measurement, provided the effect of not updating is immaterial.

At least at year end, the necessary impairment losses are recognised when there is objective evidence that all the amounts receivable will not be collected.

The impairment loss is calculated as the difference between the carrying amount of the asset and the present value of the estimated future cash flows, discounted at the effective interest rate upon initial recognition. Impairment losses are recognised and reversed in the income statement.

Disposals of financial assets

Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire or have been transferred and the Company has transferred substantially all the risks and rewards of ownership.

On derecognition of a financial asset in its entirety, the difference between the carrying amount and the sum of the consideration received, net of transaction costs, including any new assets obtained less any new liabilities assumed and any cumulative profit or loss deferred in recognised income and expense, is recorded in equity.

Value impairment on other financial assets

A financial asset or group of financial assets is impaired, and an impairment loss has occurred, if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset and the event or events causing the loss and with an impact on the estimated future cash flows of the asset or group of financial assets that can be estimated reliably.

The Company follows the criterion of recording the appropriate value adjustments for impairment of loans and receivables and debt instruments when there has been a reduction or delay in future estimated cash flows due to debtor insolvency.

Likewise, in the case of equity instruments, there is value impairment when there is a lack of recoverability of the carrying amount of the asset due to a prolonged or significant decrease in its fair value.

Offsetting principles

A financial asset is offset only when the Company currently has the legally enforceable right to offset the recognised amounts and intends either to settle on a net basis or to realise the asset simultaneously.

25.5 Cash and cash equivalents

Cash and cash equivalents include cash in hand, demand deposits at banks and financial instruments that are convertible to cash and have a maturity of three months or less from the date of acquisition, provided that there is no significant risk of changes in value and that they form part of the Company's usual cash management policy.

25.6 Net equity

The acquisition by the Group of equity instruments of the Parent Company is presented at acquisition cost separately as a reduction in net equity in the consolidated statement financial position, regardless of the reason for the acquisition. No profit or loss was recognised in transactions with own equity instruments.

The subsequent amortisation of the parent's equity instruments leads to a capital reduction in the nominal amount of said shares and the positive or negative difference between the acquisition price and the nominal share price is charged or credited to reserves.

The transaction costs relating to own equity instruments are recognised as a reduction in net equity once any tax effect has been taken into account.

25.7 Financial liabilities

Debts and payables

This category includes trade and non-trade payables. These borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement for at least 12 months after the balance sheet date.

The payables are initially recognised at fair value, adjusted for directly attributable transaction costs, and subsequently measured at amortised cost using the effective interest method.

The effective interest rate is the discount rate that matches the instrument's carrying amount with the expected future flow of payments to the maturity date of the liability.

Nevertheless, trade payables falling due in less than one year without a contractual interest rate are carried at their face value on both initial recognition and subsequent measurement, provided the effect of not discounting flows is not significant.

If existing payables are renegotiated but the lender has not changed and the present value of future cash flows, including net fees paid, differs by less than 10% from the present value of future cash payments for the original liability, calculated using the same method, the liability is not considered to be substantially modified.

Disposals of financial liabilities

A financial liability, or part of a financial liability, is derecognised when the Company either discharges the liability by paying the creditor, or is legally released from primary responsibility for the

liability either by process of law or by the creditor.

Offsetting principles

A financial liability is offset when the Company currently has the legally enforceable right to offset the recognised amounts and intends either to settle on a net basis or to settle the liability simultaneously.

25.8 Current and deferred taxes

The income tax expense (income) for the year comprises current tax and deferred tax.

The current and deferred tax expense (income) is recognised in the income statement. However, the tax effect of items recognised directly in equity is recorded in equity.

Current tax assets and liabilities are measured at the amount expected to be paid to or recovered from the taxation authorities, using the tax laws that have been enacted or substantially enacted at the balance sheet date.

Deferred tax assets and liabilities are calculated using the liability method on the basis of the temporary differences that arise between the tax base of assets and liabilities and their carrying amount. However, if deferred tax assets or liabilities arise from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affect neither accounting profit nor taxable income, they are not recognised. Deferred tax assets or liabilities are measured using the tax rates that have been enacted or substantially enacted at the balance sheet date and are expected to be applicable when the corresponding deferred tax asset is realised, or deferred tax liability is settled.

Deferred tax assets are recognised provided that it is probable that sufficient taxable income will be generated against which the temporary differences can be offset.

Deferred tax assets arising from deductible temporary differences are recognised provided future tax gains are likely to exist for offset thereof that will reverse within ten years. Assets arising from the initial recognition of assets and liabilities in a transaction which is not a business combination, and which does not affect either the carrying profit or the taxable base on transaction date, are not subject to recognition. Assets which will reverse in a period exceeding ten years are recognised over the years, provided there is a likelihood of future tax gains.

Tax planning opportunities are only considered when assessing the recovery of deferred tax assets, if the Company intends to use them or is likely to do so.

The Company recognises the reversal of a deferred tax asset in an account receivable with a Public Entity when it is enforceable in accordance with tax legislation in force. Likewise, the Company recognises the exchange of a deferred tax asset for Public Debt Securities when ownership thereof is acquired.

25.9 Employee benefits

Compensations based on the share price of Prosegur shares - 2017 and 2020 Plan

These provisions include the accrued incentive in the 2017 and 2020 long-term incentive plan for the Executive President, Executive Director and Senior Management of Prosegur Cash. During the year, provisions to profit/(loss) amounted to EUR 840 thousand (EUR 1,852 thousand at 31 December 2018). Said amount includes the amount accrued relating to the 2017 and 2020 Plan.

The 2017 Plan and 2020 Plan are generally linked to value creation and envisage the payment of share-based and/or incentives to the Executive President, Executive Director and Senior Management.

For both plans, for the purpose of determining the value of each share to which the Beneficiary has the right, the average quotation price of Prosegur Cash shares in the Madrid Stock Exchange will be taken as reference during the last fifteen trading sessions of the month prior to the one in which the shares must be delivered.

Quantification of the total incentive will depend on the degree of achievement of the targets established in line with the strategic plan.

At the general meeting held on 28 May 2018, the shareholders approved the 2020 Plan of long-term incentives for the Executive President, Executive Director and Senior Management of Prosegur Cash. The Plan is linked to the creation of value in the 2018-2020 period and envisages the payment of cash incentives, calculated for certain beneficiaries based on the share price. The Plan has a duration of three years and is based on length of service and target achievement. In the vast majority of cases, the Plan measures target achievement from 1 January 2018 until 31 December 2020 and length of service from 1 January 2018 until 31 December 2022.

The fair value of the incentives referred to the share quotation price was estimated on the basis of Prosegur Cash's share quotation price at the close of the period, EUR 1.98 share (EUR 1.93 share in 2018) or at the payment time.

25.10 Provisions and contingent liabilities

Provisions for possible restructuring costs and/or litigation are recognised when the Company has a present obligation (legal or tacit) as a result of a past event; it is probable that an outflow of resources will be required to settle the obligation; and a reliable estimate can be made of the amount of the obligation.

Provisions are measured at the present value of the estimated expenditure required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. Any adjustments made to update the provision are recognised as a financial expense when accrued.

Provisions expiring in one year or less, the financial effect of which is immaterial, are not discounted.

Reimbursements from third parties of the expenditure required to settle a provision are recognised as a separate asset provided that it is virtually certain that the reimbursement will be received.

Possible obligations arising from past events, the materialisation of which is contingent on one or more future events beyond the control of the Company, are considered contingent liabilities. These contingent liabilities are not recognised in the Annual Accounts but are disclosed in the notes (see Note 16).

25.11 Revenue recognition

Revenue is recognised at the fair value of the consideration receivable and reflects the amounts to be collected for goods handed over and services rendered in the ordinary course of the Company's activities, less returns, rebates, discounts and value added tax.

The Company recognises revenue when the amount can be reliably estimated. It is probable that the future economic benefits will flow to the Company and the specific conditions are met for each of the activities, as described below. The Company's estimates are based on historical results, taking into account client type, transaction type and specific contractual terms.

Interest received

Interest income is recognised using the effective interest method. When a receivable is impaired, the Company writes the carrying amount down to the recoverable amount, discounting estimated future cash flows at the original effective interest rate of the instrument, and carries the discount as a reduction in interest received. Interest received on impaired loans is recognised using the effective interest method.

Dividend received

Dividends received are recognised in the income statement when the right to receive payment is established.

Dividend revenue from investments in equity instruments is recognised when the rights for the Company have arisen. If the distributed dividends come unequivocally from results generated prior to the acquisition date because amounts greater than the profits generated by the investee since the acquisition have been distributed, they reduce the carrying amount of the investment.

25.12 Foreign currency transactions

Foreign currency transactions are translated into the functional currency using the exchange rate prevailing at the transaction date. Foreign currency profit and losses arising on the settlement of these transactions and the translation into EUR of monetary assets and liabilities denominated in foreign currencies at the closing exchange rate are recognised in the income statement.

25.13 Related party transactions

Transactions between Group companies, except those related to mergers, spin-offs and non- monetary contributions, are initially recognised at the fair value of the consideration given or received. If the agreed price differs from the fair value, the difference is recognised based on the economic substance of the transaction. Transactions are subsequently measured in accordance with applicable standards.

In the non-monetary contributions to a Group company, the contributor will value their investment at the carrying amount of the delivered equity items in the Consolidated Annual Accounts on the date on which the transaction is made, according to the Standards for the Preparation of Consolidate Annual Accounts. The acquiring company will recognise them for the same amount.

In the merger and spin-off transactions between companies of the group in which the parent company of the group or the parent company of a subgroup and its subsidiary directly or indirectly intervene, the acquired equity items are valued for the amount that would correspond to them after the operation in the consolidated annual accounts of the group or subgroup according to the aforementioned Standards for the Preparation of Consolidate Annual Accounts. The difference that could be shown in the accounting entry by the application of the above criteria will be recorded in a reserves item.

DIRECTORS' REPORT 2019

Directors' Report for 2019

Prosegur Cash, S.A. and subsidiaries

DIRECTORS' REPORT 2019

	Table of contents
1.	The Company's situation............................................................................	57
1.1. Business model .......................................................................................................................	57
1.2. Organisational structure .........................................................................................................	58
1.3. Operation..................................................................................................................................	60
2.	Business performance and profit/(loss) ....................................................	62
2.1. Main financial and non-financial indicators ...........................................................................	62
2.2. Investments..............................................................................................................................	62
2.3. Personnel .................................................................................................................................	62
2.4. Environment.............................................................................................................................	63
3.	Liquidity and capital resources .................................................................	63
4.	Main risks and uncertainties .......................................................................	65
4.1. Operational Risks ....................................................................................................................	65
4.2. Financial risks..........................................................................................................................	67
5.	Average payment period to suppliers .....................................................	69
6.	Important circumstances after the reporting period .............................	69
7.	Information on the foreseeable performance of the entity..................	69
8.	Acquisition and disposal of own shares ...................................................	70
9.	Alternative performance measures..........................................................	71
10. Other significant information ...................................................................	72

DIRECTORS' REPORT 2019

Directors' Report for 2019

This Directors' Report has been prepared in accordance with the recommendations contained in the Guidelines for the preparation of the Directors' Reports of listed companies, published by the CNMV.

1. The Company's situation

Prosegur Cash, S.A. was incorporated as a single person limited company in accordance with Spanish law on 22 February 2016, and subsequently transformed into a public limited company on 21 September 2016.

This Company was the result of a spin-off of the Cash business unit of the Prosegur Group, performed by means of a non-monetary contribution of entities under the shared control of the Prosegur Group.

Shares in Prosegur Cash were listed on 17 March 2017 at a price of 2 Euros each, in the stock exchanges of Madrid, Barcelona, Bilbao and Valencia and are traded on the Spanish Stock Exchange Interconnection System (SIBE).

On 7 April 2017, the Green Shoe period of the stock market flotation ended, and the free float attained 27.5% of the share capital of Prosegur Cash, S.A.

The Prosegur Cash Group operates in the following countries: Germany, Argentina, Australia, Brazil, Chile, Colombia, Costa Rica, El Salvador, Spain, the Philippines, France, Guatemala, Honduras, India, Luxembourg, Mexico, Nicaragua, Paraguay, Peru, Portugal, Singapore, South Africa and Uruguay.

1.1. Business model

Prosegur Cash provides services ranging from basic cash in transit and cash management to added- value outsourced services. It includes, primarily, the transportation, storage, safekeeping, counting and classification of coins and banknotes, deeds, securities and other items that require special protection due to their economic value or associated risk. The activity focuses mainly on the banking and retail sectors.

Prosegur Cash comprises the following business lines:

Transport: local and international transport services, via land, sea and air, of funds and other valuable goods, such as jewellery, works of art, precious metals, electronic devices, pharmaceutical products, voting ballots and legal evidence, among others. These services include collection, transport, custody, delivery and deposit in vaults.
Cash management: comprises counting, processing, equipment, custody, packaging and delivery of cash in bank notes and coins, and the loading of ATMs.
New Products:
- Automation of payments in retail establishments via self-service cash machines (Prosegur Smart Cash), including devices for paying in cash, recycling or dispensing bank notes and coins, and payment of invoices.
- ATM integrated management, including planning, supervision, first- and second-tier maintenance, and tallying.

DIRECTORS' REPORT 2019

Added-valueoutsourced services (AVOS) for banks, including planning for branch requirements, reconciliation and tallying, and credit card support services.

The mission, vision and values of Prosegur Cash evidence the aspirations and challenges and define the company's approach.

Mission

Our mission or purpose (what makes us work every day) is to generate value for our shareholders, clients and society, offering integrated cash management solutions and related activities, incorporating cutting-edge technology and relying on the talent of top professionals.

Vision

Our vision (the goal we pursue) is to be a leader (nimble and efficient) in the emerging markets sector through the consolidation and transformation of the industry, harnessing the third round of outsourcing at banks.

Values

Our values (the principles that identify us) encompass the beliefs that guide our conduct. They are the reflection of who we are, how we behave and the way we work for our clients: Proactive Approach, Value Creation, Client Friendliness, Transparency, Excellence, Leadership, Teamwork and Brand.

1.2. Organisational structure

The organisational structure of the Group, of which the Company is parent, is designed to improve business processes and add value to our clients every day. Its flexibility allows for a permanent adaptation to an ever-changing environment and the evolution of Prosegur Cash Group as a business group.

The Business Areas are divided into three geographical segments-Europe,Asia-Oceania-Africa (AOA) and LatAm-plus a fourth, the Division for Innovation and Productivity, affording us a nimble and efficient structure that is entirely client-oriented, adapting to the various needs of our clients and ensuring innovation in our products.

The corporate functions are supervised by the Global Support Divisions that cover the Finance, Human Resources, Investor Relations, Legal, Strategic Planning and Risk Management areas.

DIRECTORS' REPORT 2019

The organisation of Prosegur Cash Group is shown in the table below:

The Board of Directors is the top management body and the body ultimately responsible for decision- making with regard to operations and reviewing the internal financial information with a view to evaluating profit/(loss) and allocating resources.

Changes to the Group's structure

The changes in the composition of the Prosegur Cash Group, of which the Company is the parent, during 2019 were mainly due to the following acquisitions:

Cash business combinations in LatAm: In 2019, in LatAm Prosegur acquired a series of security companies and assets providing cash in transit and cash management services and conducting correspondent banking activities. The total purchase price was EUR 65,093 thousand, comprising a cash consideration of EUR 30,811 thousand, a deferred contingent consideration amounting to a total of EUR 24,506 thousand, due in 2019 and 2020 and a deferred payment of EUR 9,776 thousand, due in 2020 and 2021.
Cash business combinations in ROW: in 2019, Prosegur acquired a security company providing cash in transit and cash management services. The total purchase price was EUR 4,320 thousand, comprising a cash payment of EUR 1,242 thousand, and a deferred payment of EUR 3,079 thousand maturing in 2019 and 2020.

DIRECTORS' REPORT 2019

Cash business combinations in Europe: In 2019, in Europe, Prosegur acquired a software engineering company specialised in the development of technological solutions for the insurance industry implemented in open systems and platforms, and a company that provides service management services related to digital software of the retail sector. The total purchase price was EUR 22,845 thousand, consisting of a cash payment of EUR 15,320 thousand, and a deferred contingent consideration for a total of EUR 7,525 thousand due for payment in 2020, 2021, 2022 and 2023.

The following companies were incorporated or wound up in 2019:

In March 2019, Prosegur Alpha3 Cashlabs S.L. was incorporated in Spain.
In April 2019, Prosegur Pay Consultoria em Tecnologia da Informação Ltda. was incorporated in Brazil.
In September 2019, Prosegur STV 1 PTY Limited was incorporated in Australia.
In October 2019, Gelt Cash Transfer, S.L. was incorporated in Spain.
In October 2019, Dopar Servicios, S.L. was wound up in Spain.
In October 2019, Iberprofin, S.L. was wound up in Spain.

The following mergers took place between subsidiaries in 2019:

In August 2019, the takeover merger of Tellex, S.A. by Transportadora de Caudales Juncadella, S.A. was formalised in Argentina.
In November 2019, the takeover merger of Enclama, S.L. by Prosegur AVOS España, S.L. was formalised in Spain.

Prosegur Cash exercised the put option on its 33.33% stake in SBV Services Propietary Limited on 4 June 2019.

Prosegur signed the sale agreement of 100% of the capital of Prosegur Cash Holding France to Loomis AB on 22 July 2019.

1.3. Operation

The unceasing development of the environment in which Prosegur Cash operates has played a crucial role in the company's transformation over the last few years. In this connection, Prosegur Cash established three main goals:

Respond to clients' new needs, in line with market trends.
Become their trusted strategic partner.
Boost their value through efficiency in processes and by implementing increasingly technological services.

At present, Prosegur Cash is in the midst of a new Prosegur Group Three-Year Strategic Plan 2018- 2020. Our ambition to lead the transformation of the industry has led us to embark on a digital transformation of the company, hinging upon three basic pillars: Digitalise, Innovate and Grow.

Specific goals have been set in connection with each pillar and, after the first year of the plan, considerable progress has already been made.

DIRECTORS' REPORT 2019

Agility (Digitalisation)

With regard to digitalisation, the established goals are:

Roll out the necessary platforms and tools to simplify management and enhance the client experience, paving the way for Prosegur Cash to lead the industry in the future.
Support operational excellence and the technological improvement of processes in order to boost profitability.
Reduce the weight of indirect costs that do not create value for clients.
Attract, develop and retain the most highly-qualified professionals. To do this, Prosegur offers them the necessary know-how and tools to enhance their skills and grow within the Company.

In 2019, the second year of the 2018-2020Three-Year Plan, progress was made in the following areas:

Advances in the process for digital transformation with regard to agility, scalability and operational excellence.

Consolidation (Growth)

With regard to growth, the established goals are:

Maintain high rates of profitable organic growth.
Continue with the pace of growth logged in recent years, spearheading market consolidation and stimulating the sale of new products.

2019 has seen advances made in the following business lines:

The solidity of the business model translated into a strong growth in local currency.
Bolt-onacquisitions in traditional businesses and acceleration of new products.
Strategic divestments.

Transformation (Innovation)

With regard to innovation, the established goals are:

Listen to clients to develop new value proposals that meet their needs.
Introduce new products that improve client satisfaction, transform the business, help to increase margins and evidence our firm commitment to innovation.

The following advances have already been made in 2019:

Increase in the weight of new products over total sales.
Definition of innovation methodology based on horizons and under ad hoc governance model.
Incorporation of talent in innovation.
Collaboration with Amazon in challenges of digital innovation.

DIRECTORS' REPORT 2019

2. Business performance and profit/(loss)

2.1. Main financial and non-financial indicators

(Thousands of euro)		2019		2018	Variation
Sales	113,016	161,789	-30.15%
EBITDA	101,573	148,708	-31.70%
Margin	90%	92%
PPE depreciation	(126)	(93)
Amortisation of intangible assets	(2,798)	(2,735)
EBIT	98,648	145,881	-32.38%
Margin	87%	90%
Financial results	(13,354)	(13,546)
Profit before tax	85,294	132,336	-35.55%
Margin	75%	82%
Tax	4,191	3,283
Tax rate	5%	2%

Net result	89,485	135,619	-34.02%

2.2. Investments

All of the Prosegur Cash Group's investments are analysed by the corresponding technical and operating areas and the management control department, which estimate and examine the strategic importance, return period and yields of the investments before these are approved. Subsequently these are submitted to the Investment Committee for a final decision on whether to proceed with the investment. Investments in excess of EUR 0.6 million are submitted to Prosegur Cash's Management for approval.

2.3. Personnel

The company's personnel as of 31 December 2019 was 43 people (40 in 2018).

DIRECTORS' REPORT 2019

2.4. Environment

At the end of 2019, the Company has no environment-related contingencies, legal claims or income and expenses relating to the environment.

3. Liquidity and capital resources

Liquidity

Prosegur Cash keeps a reasonable level of liquid reserves and a great financing capacity available to ensure flexibility and rapidity in meeting the requirements of working capital, of investing capital or inorganic growth.

Capital resources

The structure of the long term financial debt is determined by the following contracts:

In order to partially finance the subscription of shares representing 33.33% of the share capital of the South African company SBV Services Proprietary Limited, Prosegur arranged a 4-year bullet loan on 29 January 2016 for ZAR 272,000 thousand. On 20 June 2019, and as consequence of exercising the sales option on the 33.33% holding in SBV (Note 6 of the Consolidated Annual Accounts), the entire loan has been cancelled in advance, therefore there is no outstanding amount at 31 December 2019 (at 31 December 2018: Rand 272,000 thousand, equivalent value at 31 December 2018: EUR 16,534 thousand).
On 10 February 2017, a new syndicated financing operation was arranged for a credit facility in the amount of EUR 300 million for a five-year term. At 31 December 2019, the capital drawn down amounted to EUR 20 million.
On 28 April 2017, Prosegur Cash, via its subsidiary Prosegur Australia Investments Pty, arranged a syndicated financing operation in the amount of AUD 70,000 thousand for a 3- year term. At 31 December 2019 the drawn down capital corresponding to the loan amounts to AUD 70,000 thousand (equivalent to EUR 43.8 million at 31 December 2019).
On 4 December 2017, Prosegur Cash, S.A. launched a EUR 600 million bond issue maturing on 4 February 2026. The bonds trade in the secondary market-the Irish Stock Exchange-accruing an annual coupon of 1.38%, payable at the end of each year.

Long-term gross financial debt maturing over one year has reached at the end of 2019 the amount of EUR 592 million (EUR 609 million in 2018).

Current gross financial debt totals EUR 83 million (EUR 74 million in 2018) mainly due to loans with credit institutions.

The current and non-current maturities of gross financial debt are distributed as follows:

DIRECTORS' REPORT 2019

	Gross financial debt
	(Millions of euros)
800.0

700.0
95.1		102.5
600.0


500.0

400.0
609.2
300.0		593.3
200.0

100.0

0.0	2018		2019

		L/P		C/P

The average cost of financial aid for the 2019 market was 1.70% (2018: 2.02%). The reduction of the cost of the product is due to the reduction of the cost of the Corporate product and its subsidiaries.

The financial aid net (excluding other non-bank payments corresponding to the payments settled by M&A acquisitions) at the beginning of 2019 is 636.8 million euros (2018: 677.7 million euros).

Next, a comparative chart of gross income and net income (excluding payments paid for M&A purchases) for 2018 and 2019 is shown:

			Financial debt evolution
				(Millions of euros)
800.0
		704,3				695,8


700.0		26.6
	59.0

600.0

500.0

400.0
677.7			636.8
300.0


200.0

100.0

0.0
	2018			2019
					Resto	Deuda neta

DIRECTORS' REPORT 2019

No significant changes are expected in 2020 in regard to the structure of own funds and capital or in regard to the relative cost of capital resources in relation to the financial year ending 31 December 2019.

Analysis of contractual obligations and off balance sheet obligations

At 31 December 2018 there are no commitments to purchase and sale assets or of any other nature.

4. Main risks and uncertainties

The Prosegur Cash Risk Management system is mainly based on the COSO (Committee of Sponsoring Organizations of the Treadway Commission) system and works together with applied standards in the main clients of financial industry, such as Basel III, and the ISO 31000 standards. The maximum responsibility for risk management falls on the Board of Directors. Among the basic responsibilities of the Audit Committee are to supervise the efficiency of internal control and risk management systems, to verify their suitability and integrity and to review the designation and replacement of the persons responsible.

The main risks identified are:

Regulatory risk. Regulatory non-compliance, including laws concerning labour and social security, tax, arms control or anti-money laundering in each market and/or as a whole. Adverse changes in regulatory conditions, including tax legislation, or restrictions on obtaining or renewing permits and licences.
Risks relating to incidents involving assets guarded or loss of cash. Insufficient insurance cover.
Transactions in markets with a temporary reduction in demand. Prolonged reduction in the use of cash.
Transactions in highly competitive markets. Pressure on prices and margins. Economic environment.
Reputational risk. Negative publicity in connection with the Company. Loss of confidence.
Financial risks, including changes in interest rates or exchange rates, counterparty and tax risks.
Failures or incidents in the IT infrastructure.
Loss or theft of confidential information on clients or pertaining to the Company. Cyberattacks, security breaches and IT failures.
Inadequate management of labour costs.
Decline in liquidity generation or in cash management.

4.1. Operational Risks

The Prosegur Cash risk management cycle is the following:

DIRECTORS' REPORT 2019

Regulatory risk

The security sector is subject to a variety of regulations that are constantly changing and are applicable to the activities of the Group and its clients all over the world. Increasing regulations in the regions where Prosegur Cash conducts its business could have a substantial adverse effect on its activity, financial situation and operating income.

Specifically, Prosegur Cash's activity is directly and indirectly affected by legislation, regulations and administrative requirements of local, regional and national authorities of the countries where it operates, and the special requirements of other entities, such as insurance companies and organisations within the sector. Certain aspects of Prosegur Cash's activity are subject to licensing requirements. Furthermore, many countries require permits for security services, including for carrying weapons when armoured vehicles are used to transport goods. The Group depends on maintaining these licences and permits, and on renewing them where appropriate. Similarly, many of the Group's clients, such as financial institutions, are subject to regulations, and if these regulations change they may indirectly have a material adverse effect on the Group's business, financial situation and operating income.

There is no guarantee that legislation, regulations and requirements imposed by authorities and other entities will not change in the future and, accordingly, alter the conditions of the Group's activity. The authorities may introduce new guidelines concerning requirements for specific practices, security solutions and training and certification of staff. The Group could be required to effect changes in its operations or additional investments to adapt to new or amended laws or standards, such as increasing the number of staff manning an armoured vehicle or using cash degradation mechanisms, such as staining bank notes to render them unusable in the event of robbery. These changes and the relevant

DIRECTORS' REPORT 2019

investments could have a substantial adverse impact on the Group's business, financial situation and operating income. Likewise, a reduction or easing of local regulations could result in increased competition for the Group due to the entry of new participants in the market or a larger number of smaller competitors. Moreover, failure to comply with applicable laws or regulations could lead to sizeable finds or the revocation of the Group's permits and operating licences, which would also have a substantial adverse effect on its business, financial activity and operating income.

Prosegur strives to ensure regulatory compliance and the management of operational and regulatory compliance risks, in view of their impact on the commitments undertaken with stakeholders and, in particular, with clients.

Regulatory risks are mitigated by identifying the risk at an operational level, regularly assessing the control environment and implementing and continuously monitoring programmes to ensure the proper operation of controls implemented.

The local Business Areas define the policies, procedures and tools for their identification and quantification, as well as the proposal of measures to mitigate risk and the ongoing monitoring of any deviation from established tolerance levels, at an operational control level and in regard to regulatory compliance. For this purpose, there are standard procedures in place in all the countries where the group operates, consistent with the requirements of regulations applicable in each case.

Likewise, Management plays a crucial role in compliance with all regulations affecting the Prosegur Cash Group. With regard to regulations affecting the prevention of money laundering, it has money laundering prevention units (MLPUs) in those countries where it is subject to applicable regulations (Spain, Australia and all LatAm countries where it operates). These units focus on implementing control and supervisory measures to prevent the cash in transit business from being used to launder funds.

Operational risks

Operational risks are those related to burglaries and robberies, errors in operations, legal penalties and, as a result thereof, business continuity risk. There are formal programmes and policies that help to control this type of risk.

We would highlight the monitoring duties carried out by the Security Area in traceability control and monitoring processes of operations carried out in the transport, handling and storage of cash. Furthermore, additional assistance is provided for claims or differences in the cash management activity, helping to identify best practices and designing procedures to minimise the risk of loss.

Client concentration

The Prosegur Cash Group does not have significant concentrations of clients. Note 30.1 of the Consolidated Annual Accounts shows tables of representativity of the main clients over the overall turnover of Prosegur Cash Group.

4.2. Financial risks

Interest rate risk

Prosegur Cash Group is exposed to interest rate risk due to its monetary assets and liabilities.

DIRECTORS' REPORT 2019

The Prosegur Cash Group analyses its interest rate risk exposure dynamically. In 2019, the majority of Prosegur Cash Group's financial liabilities at floating interest rates were denominated in Euros.

A simulation of various scenarios, considering refinancing, the renewal of current positions, alternative financing and hedges is performed. On the basis of these scenarios, the Prosegur Cash Group calculates the impact on the profit/(loss) of a given variation of the interest rate. Each simulation uses the same variation in the interest rate for all currencies. These scenarios are only analysed for the liabilities that represent the most significant positions in which a variable interest rate is paid.

Currency risk

Prosegur Cash is exposed to foreign currency exchange risks arising from its revenues being generated in various currencies (mainly Brazilian real, Argentine, Colombian, Chilean and Mexican pesos, Peruvian sol and Australian dollar), while its functional currency is the Euro.

To the extent that local costs and revenues are denominated in the same currency, the effect of exchange rate fluctuations on Prosegur Cash's margins may be neutral (although the absolute size of these margins in Euros would continue to be affected). Fluctuations in exchange rates may also affect the Company's financing costs for instruments denominated in currencies other than the Euro. While some of these effects can be offset by corresponding inflation fluctuations, this will not necessarily be the case.

In general, Prosegur Cash does not use currency derivatives to hedge its expected future operations and cash flows, so exchange rate fluctuations may have an adverse effect on the business and, accordingly, the Company's financial situation and profit/(loss).

The natural coverage made by Prosegur Cash Group is based on the capital expenditure required in the industry, which varies by business area, is in line with the operating cash flow generated and it is possible to time the investments made in each country based on operating requirements.

The debt in EUR represents almost all of the financial debt.

Note 23 of the Prosegur Cash's Individual Annual Accounts reflects the value of financial liabilities by currency.

Credit risk

The Credit and Collection Departments of each of the countries in which the Prosegur Cash Group operates carries out a risk assessment of each client on the basis of the contract data and establishes credit limits and payment terms which are recorded in the Prosegur Cash Group's management systems and periodically updated. Monthly tracking of the credit situation of the clients is carried out, making any value corrections deemed necessary on the basis of clearly established policies.

As for financial investments and other operations, these are carried out with defined rating entities and financial transaction framework agreements are entered into (CMOF or ISDA). Restrictions on counterparty risk are clearly defined in the corporate policies of Financial Management and updated credit limits and levels are periodically published.

DIRECTORS' REPORT 2019

5. Average payment period to suppliers

The average payment period to suppliers in 2019 was 59 days (52 days in 2018).

6. Important circumstances after the reporting period

No subsequent events have taken place following the close of financial year 2019 that might suppose any significant change to the presentation of the Annual Accounts.

7. Information on the foreseeable performance of the entity

If 2019 was marked by an uncertain political environment in LatAm and an adverse macroeconomic and exchange rate scenario, the forecasts for 2020 are moderately optimistic. Aspects such as greater certainty in the Brazilian economy or the relaxation of monetary conditions in the United States may translate into more favourable prospects for emerging economies.

In any case it is considered necessary to pay attention to those economies presenting sizeable external imbalances and/or high levels of indebtedness, since they will likely continue to face adverse financial conditions.

In Brazil, the estimate is that it is likely to continue with the reformist agenda and, after the reformation of the pension system, address other relevant issues such as the reformation of the tax system. In Argentina, special attention will be given to the renegotiation of the debt which, according to the new government, is expected to be undertaken during the first half of the year. This situation could introduce some uncertainty until an agreement is reached. Finally, the possible impact that trade tensions between the United States and China could have on the economic growth of the European region will be monitored.

Against this macroeconomic backdrop, the company will remain focused on developing its business in new products, where it expects to post significant growth. Moreover, it will work to improve its profitability in local terms and will continue to apply best practices in order to optimise efficiency in the operations and in cash generation.

LatAm currencies are expected to continue to depreciate over the course of 2020, albeit less so than in the previous year. In this sense, the Company expects to reduce this impact as far as possible by capturing natural growth in these markets, preserving and increasing margins and offering new solutions and services that allow the client base to be expanded.

The experience and ability of the Company to pass cost increases on to prices in economic environments which are undergoing a gradual maturity process, allow us to approach 2020 with optimism.

Prosegur Cash has also consolidated a successful and resilient business model over the years. The company is thus able to mitigate the impact of events that could affect the normal performance of the

DIRECTORS' REPORT 2019

activity, while maintaining or improving the results. Some examples of these situations are markets in recession, capital control policies or currency devaluations.

In the case of Europe, the macroeconomic environment should gently boost business growth. Additionally, an improvement in profitability might be seen, benefited by the sale of the operations in France. Prosegur Cash therefore hopes to continue to show a high capacity for adaptation to various situations and to leverage the burgeoning favourable situation in order to become a leading provider of advanced banking outsourcing services in Europe.

Lastly, in the rest of the world, the Company will address the challenge of completing the integration of operations in the Philippines and Indonesia and of resuming growth in Australia. In this sense, the progress in certain commercial and operational initiatives implemented in 2019, allows us to view 2020 more optimistically.

The combination of a solid financial structure, limited levels of leverage, and the capacity to generate cash puts the Company in a comfortable position to face the inorganic growth strategy. Furthermore, Prosegur Cash will not exceed the debt levels that it has imposed on itself. These limits, it should be remembered, are more stringent than those included in the bank financing contracts that the Company has, or those required by the rating agencies for investment grade companies.

For all the above, Prosegur Cash will continue to promote organic growth, both through traditional services and through new products, while maintaining its current profitability levels. The Company also expects to continue consolidating its leadership, gaining market share and enhancing its image as a global flagship in the sector.

In conclusion, it is worth noting that the Company has excellent growth levers, one of the world's best platforms for transporting funds and handling cash, with a notable presence in emerging markets, unequalled by any competitor, and optimal solvency and financial solidity to drive its expansion and to satisfactorily face the great challenges approaching in the coming financial years.

Estimates and opinions regarding the future development and profit/(loss) at Prosegur Cash's businesses are subject to risks, uncertainties, changes in circumstances and other factors that may lead the actual profit/(loss) to differ materially from forecasts.

8. Acquisition and disposal of own shares

On 8 May 2017, the Company signed a liquidity agreement in accordance with the regulations in force at that time. Prior to signing this agreement, the Company did not have treasury stock. The operating process prior to the liquidity contract to set up treasury stock ended on 8 June 2017, having attained treasury stock of 1,000,000 shares. The liquidity contract came into operation on 9 June 2017 and ended on 10 July, when the liquidity agreement was terminated. On 7 July 2017, the Company S.A. signed a new liquidity agreement, entering into force on 11 July 2017, in accordance with the new legislation, commencing operations again to boost the contractual liquidity.

At 2019 year end, Prosegur Cash, S.A.'s treasury stock amounted to 1,119,862 shares (1,057,307 shares in 2018), of which 696,866 are linked to the liquidity agreement (602,496 in 2018).

DIRECTORS' REPORT 2019

9. Alternative performance measures

In order to meet ESMA guidelines on Alternative Performance Measures (hereinafter, APMs), the Prosegur Cash Group presents this additional information to enhance the comparability, reliability and understanding of its financial reporting. The company presents its profit/(loss) in accordance with International Financial Reporting Standards (IFRS-EU). However, Management considers that certain alternative performance measures provide additional useful financial information that should be taken into consideration when assessing its performance. Management also uses these APMs to make financial, operating and planning decisions, as well as to assess the Company's performance. The Prosegur Cash Group provides those APMs it deems appropriate and useful for users to make decisions and those it is convinced represent a true and fair view of its financial information.

APM

Definition and calculation

Purpose

Capex

EBIT margin

Net Financial Debt

EBITA

EBITDA

Capex (Capital Expenditure), is the expense that a company incurs in capital goods and that creates benefits for the company, whether through the acquisition of new fixed assets or by means of an increase in the value of fixed assets already in existence. CAPEX includes additions of property, plant and equipment as well as additions of IT applications of the intangible assets.

The EBIT margin is calculated by dividing the operating income of the company by the total figure of revenue.

The Company calculates financial debt as the sum of the current and non-current financial liabilities (including other non-bank payable corresponding to deferred M&A payments and financial liabilities with Group companies) minus cash and cash equivalents, minus current investments in group companies and minus other current financial assets.

EBITDA is calculated on the basis of the consolidated profit/(loss) for the period without including the profit/(loss) after taxes from discontinued operations, taxes on earnings, financial income or costs, or depreciations of Goodwill or the amortisation of intangible assets, but including the depreciation of IT applications.

EBITDA is calculated on the basis of the consolidated profit/(loss) for the period for a company, excluding earnings after taxes from discontinued operations, income taxes, financial income or costs, and amortisation expenses or depreciation on goodwill.

CAPEX is an important indicator of the life cycle of a company at any given time. When the company grows rapidly, the CAPEX will be greater than fixed asset depreciations, which means that the value of the capital goods is increasing rapidly. On the other hand, when the CAPEX is similar to the depreciations or even less, it is a clear sign that the company is decapitalising and may be a symptom of its clear decline.

The EBIT margin provides the profitability obtained of the total revenue accrued.

The net debt provides the gross debt less cash in absolute terms of a company.

The EBITDA provides an analysis of earnings before taxes, tax burden and amortisation of intangible assets.

The purpose of the EBITDA is to obtain a fair view of what the company is earning or losing in the business itself. The EBITDA excludes variables not related to cash that may vary significantly from one company to another depending upon the accounting policies applied. Amortisation is a non- monetary variable and thereof of limited interest for investors.

The reconciliation of Alternative Performance Measures is as follows:

DIRECTORS' REPORT 2019

CAPEX (In thousands of Euro)		31.12.2019		31.12.2018
Technical installations and machinery	22	53
Other installations and furniture	985	64
Other assets		199		15
Subtotal: Property, Plant and Equipment additions	1,206		132
Software additions	3,140	420
Total CAPEX		4,346
	552
EBIT Margin (In thousands of Euro)
31.12.2019		31.12.2018
EBIT			98,648
		145,880
Revenue	113,016	161,789
EBIT margin		87.3%		90.2%
Financial liabilities
31.12.2019		31.12.2018
Financial liabilities (A)		695,788		704,291
Cash and cash equivalents (B)		(40,982)		(2,286)
Less: other financial current assets (C)		-		-
Total Net Financial Debt (A+B+C)		654,806		702,005
Less. Other non banking debts (D)		(17,975)		(24,348)
Total Net Financial Debt (excluding other non-bank		636,831	677,657
payables corresponding to deferred payments for M&A
acquisitions) (A+B+C+D)
EBITA (In thousands of Euro)
31.12.2019		31.12.2018
Profit of the year		89,485		135,618
Income tax	(4,191)	(3,283)
Financial costs	13,354	13,546
Amortisation	2,798	2,735
EBITA			101,446
		148,616
EBITDA (In thousands of Euro)
31.12.2019		31.12.2018
Profit of the year		89,485
	135,618
Income tax	(4,191)	(3,283)
Financial costs	13,354	13,546
Depreciation and amortization	2,925	2,828
EBITDA		101,573
	148,708

10. Other significant information

Stock market information

Prosegur Cash focuses its efforts in the creation of value for its shareholders. Improving profit/(loss) and transparency, as well as rigour and credibility, are what guides the Company's actions.

DIRECTORS' REPORT 2019

The Company's corporate website features the policy that governs its relationship with shareholders and investors, as approved by its Board of Directors. In this connection it undertakes to foster effective and open communication with all shareholders, at all times ensuring that the information it provides is both coherent and clear. Moreover, the company seeks to maintain transparent and regular contact with its shareholders, so as to nurture mutual understanding of their goals.

In order to fulfil our commitment to transparency, the Company tries to provide all its financial and strategic communications in an open and coherent manner, ensuring, wherever possible, the use of simple language to make them comprehensible, and that the information shows a fair, balanced and understandable view of the situation and prospects of Prosegur Cash.

The company is open to receiving comments and suggestions for improvement, which may be submitted through the specific channels for this purpose mentioned on the website and/or in the investor communication policy.

Finally, in order to present the financial information to investors, the company reports its profit/(loss) quarterly via webcast (on its website). The company's profit/(loss) presentation is led by the Chief Financial Officer and the Director of Investor Relations, and, on an annual basis, by the Executive Director.

Analysts coverage

The recommendations of the 16 investment companies that follow Prosegur Cash are as follows:

Analyst recommendatons

Sell 0%

Keep		44%

Purchase									56%
Comprar

0%	10%	20%	30%	40%	50%	60%
					Purchase		Keep	Sell

On 31 December 2019, Prosegur Cash's share price closed at EUR 1.36 , i.e. 30% lower than in the previous December.

Main shareholders

The shareholding structure of Prosegur Cash reflects its solidity and stability.

DIRECTORS' REPORT 2019

At 31 December 2019, 72.50% of share capital belongs directly or indirectly to Prosegur, whereas the remaining 27.5% is free float, with notable holdings belonging to Invesco Limited with 3.787%.

The composition of the Board of Directors enables the management bodies to define the strategic lines and decisions in line with the interests of all its shareholders. This solid and stable shareholder base of relevance, made up of significant shareholders and institutional investors, provides Prosegur Cash with the ideal conditions to develop its project and achieve its objectives.

Geographical distribution of free float

Prosegur Cash is widely accepted among both domestic and foreign investors. In this regard, most of the free float is distributed among American, Spanish and British investors.

Free Float

13%

14%

48%

25%

USA

Spain

Rest of the world

Annual Corporate Governance Report

The Annual Corporate Governance Report of Prosegur for financial year 2019 forms part of the Directors' Report and as of the date of publication of the Annual Accounts is available on the web page of the National Securities Market Commission and the Prosegur website.

This report includes section E, analysing control and risk management systems of the Company; and F, providing details on the risk control and management system in relation with the process of issue of financial information (SCIIF).

DIRECTORS' REPORT 2019

STATEMENT OF RESPONSIBILITY FOR THE ANNUAL FINANCIAL REPORT OF 2019

The members of the Board of Directors of Prosegur Cash, S.A. hereby confirm that, to the best of our knowledge, the Individual Annual Accounts of Prosegur Compañía de Seguridad, S.A. for 2019, authorised for issue by the Board of Directors at the meeting held on 26 February 2020 and prepared in accordance with applicable accounting principles, present fairly the equity, financial position and profit/(loss) of Prosegur Cash, S.A., and that the respective individual Directors' Reports provide a reliable analysis of the Company's performance and results and the position of Prosegur Cash, S.A., together with the main risks and uncertainties facing the Company.

In Madrid, 26 February 2020.

Mr Christian Gut Revoredo	Mr Pedro Guerrero
Executive President	Vice-President

Mr José Antonio Lasanta Luri	Ms Chantal Gut Revoredo
Executive Director	Director

Mr Antonio Rubio Merino	Mr Claudio Aguirre Pemán
Director	Director

Ms María Benjumea Cabeza de Vaca	Ms Ana Inés Sainz de Vicuña Bemberg
Director	Director

Mr Daniel Guillermo Entrecanales Domecq Director

DIRECTORS' REPORT 2019

DIRECTORS' RESPONSIBILITY OVER THE ANNUAL ACCOUNTS

The Consolidated Annual Accounts of Prosegur Cash, S.A. and subsidiaries are the responsibility of the Directors of the parent company and have been prepared in accordance with international financial reporting standards endorsed by the European Union.

The Directors are responsible for the completeness and objectivity of the Annual Accounts, including the estimates and judgements included therein. They fulfil their responsibility mainly by establishing and maintaining accounting systems and other regulations, supporting them adequately using internal accounting controls. These controls have been designed to provide reasonable assurance that the Company's assets are protected, that transactions are performed in accordance with the authorisations and regulations laid down by Management and that accounting records are reliable for the purposes of drawing up the Annual Accounts. The automatic correction and control mechanisms are also a relevant part of the control environment, insofar as corrective action is taken when weaknesses are observed. Nevertheless, an effective internal control system, irrespective of how perfect its design may be, has inherent limitations, including the possibility of circumventing or invalidating controls, and can therefore provide only reasonable assurance in relation with preparation of the Annual Accounts and the protection of assets. However, the effectiveness of internal control systems may vary over time due to changing conditions.

The Company evaluated its internal control system at 31 December 2019. Based on this evaluation, the Directors believe that existing internal accounting controls provide reasonable assurance that the Company's assets are protected, that transactions are performed in accordance with the authorisations laid down by Management, and that the financial records are reliable for the purposes of drawing up the Annual Accounts.

Independent auditors are appointed by the shareholders at their Annual General Meeting to audit the Annual Accounts, in accordance with the technical standards governing the audit profession. Their report, with an unqualified opinion, is attached separately. Their audit and the work performed by the Company's internal services include a review of internal accounting controls and selective testing of the transactions. The Company's management teams hold regular meetings with the independent auditors and with the internal services in order to review matters pertaining to financial reporting, internal accounting controls and other relevant audit-related issues.

Mr Javier Hergueta Vázquez Chief Financial Officer

DIRECTORS' REPORT 2019

www.prosegurcash.com

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Prosegur Cash SA published this content on 23 September 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 September 2020 07:44:08 UTC

Latest news about Prosegur Cash, S.A.

Transcript : Prosegur Cash, S.A., 2023 Earnings Call, Feb 29, 2024	Feb. 29
Prosegur Cash, S.A. Reports Earnings Results for the Full Year Ended December 31, 2023	Feb. 27	CI
Tranche Update on Prosegur Cash, S.A.'s Equity Buyback Plan announced on December 21, 2021.	Dec. 21	CI
Prosegur Cash, S.A.'s Equity Buyback announced on December 21, 2021, has closed with 38,000,000 shares, representing 2.53% for ?24.29 million.	Dec. 20	CI
Transcript : Prosegur Cash, S.A., Q3 2023 Earnings Call, Oct 27, 2023	23-10-27
Prosegur Cash, S.A. Reports Earnings Results for the Nine Months Ended September 30, 2023	23-10-26	CI
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Prosegur Cash, S.A. Reports Earnings Results for the Half Year Ended June 30, 2023	23-07-28	CI
Transcript : Prosegur Cash, S.A., Q2 2023 Earnings Call, Jul 28, 2023	23-07-28
Australian Competition Regulator OKs Prosegur Cash, Linfox Armaguard Merger Deal	23-06-13	MT
Transcript : Prosegur Cash, S.A., Q1 2023 Earnings Call, Apr 28, 2023	23-04-28
Prosegur Cash, S.A. Reports Earnings Results for the First Quarter Ended March 31, 2023	23-04-27	CI
Prosegur Cash, S.A. Reports Earnings Results for the Full Year Ended December 31, 2022	23-02-28	CI
Transcript : Prosegur Cash, S.A., 2022 Earnings Call, Feb 28, 2023	23-02-28
Transcript : Prosegur Cash, S.A., Q3 2022 Earnings Call, Nov 04, 2022	22-11-04
Prosegur Cash, S.A. Reports Earnings Results for the Nine Months Ended September 30, 2022	22-11-03	CI
Prosegur Cash, S.A. announces an Increase in Equity Buyback.	22-10-26	CI
Prosegur Cash, S.A. acquired The Change Group International Plc.	22-10-09	CI
Prosegur Cash, S.A. Reports Earnings Results for the Half Year Ended June 30, 2022	22-07-29	CI
Transcript : Prosegur Cash, S.A., H1 2022 Earnings Call, Jul 29, 2022	22-07-29
Prosegur Cash Merges Australian Cash In Transit, ATM Units With Linfox Armaguard	22-07-28	MT
Linfox Armaguard Pty Ltd entered into agreement to acquire 65% stake in Prosegur Australia Pty Limited from Prosegur Cash, S.A..	22-07-27	CI
Transcript : Prosegur Cash, S.A., Q1 2022 Earnings Call, May 12, 2022	22-05-12
Prosegur Cash, S.A. Reports Earnings Results for the First Quarter Ended March 31, 2022	22-05-11	CI
Tranche Update on Prosegur Cash, S.A.'s Equity Buyback Plan announced on December 21, 2021.	22-02-28	CI

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Company Profile

Prosegur Cash SA, formerly Prosegur Cit Holding SA, is a Spain-based company engaged in the provision of security services. The Company's activities are divided into three business areas: Logistics, Cash management and Outsourcing. The Logistics division focuses on the provision of local and international transport services of cash and other valuable goods. The Cash management division offers counting, processing, custody, preparation and delivery of notes and coins, as well as replenishment of automatic teller machines (ATMs). The Outsourcing division includes a number of support financial services, such as automation of retail operations through self-service cash automatization machines (MAEs), ATMs management, as well as branch forecasting, reconciliation, settlement and credit card support services. The Company operates through own branches and joint ventures in Europe, Central and South America, Africa, Asia and Australia. It operates through Contesta Teleservicios SAU.

Sector

Business Support Services

Calendar

2024-05-07 - Q1 2024 Earnings Release (Projected)

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Ratings for Prosegur Cash, S.A.

Trading Rating

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ESG Refinitiv

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Analysts' Consensus

Sell

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Mean consensus

OUTPERFORM

Number of Analysts

Last Close Price

0.483 EUR

Average target price

0.705 EUR

Spread / Average Target

+45.96%

Consensus

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Security Services

Prosegur Cash, S.A.

Equities

CASH

ES0105229001

Business Support Services

Prosegur Cash S A : Individual Annual Accounts 2019

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Sector Security Services