75
4.21 Business Combinations
Business combinations whereby the Group acquires control of an entity are accounted for using the acquisition cost method, calculating goodwill as
the difference between the sum of the consideration transferred, the non-controlling interests and the fair value of any previous stake in the acquired
entity, less the identifiable net assets of the acquired entity, measured at fair value.
In the event that the difference between these items is negative, income is recognised in the consolidated comprehensive profit and loss statement.
In the case of business combinations carried out in stages, goodwill is measured and recognised only once control of a business has been acquired.
To do this, previous holdings are re-measured at fair value and the corresponding gain or loss is recognised.
4.22 Environmental Policy
Investments arising from environmental activities are valued at their original cost and capitalised as increases in the cost of fixed assets or inventory
in the financial year in which they are incurred.
Any expenses arising from environmental protection and improvement are recognised in profit or loss for the year in which they are incurred,
irrespective of the moment when the cash or financial flows deriving from them arise.
Provisions for likely or certain liabilities, ongoing litigation and outstanding indemnities or obligations of an indeterminate amount connected with
the environment and not covered by the insurance policies taken out are established at the time the liability or obligation linked to the indemnities
or payment arises.
4.23 Consolidated Cash Flow Statements
The following terms with their corresponding explanation are used in the consolidated cash flow statements prepared using the indirect method:
- Cash flows: inflows and outflows of cash and cash equivalents, which are short-term, highly liquid investments that are subject to an insignificant
risk of changes in value.
- Operating activities: The typical activities of the entities forming the consolidated group, along with other activities that cannot be classified
as investing or financing activities.
- Investing activities: the acquisition and disposal of long-term assets and other investments not included in cash and cash equivalents.
- Financing activities: activities that result in changes in the size and composition of the equity and liabilities that are not operating activities.
5.- EARNINGS PER SHARE
Basic earnings per share (EPS) are calculated by dividing the net profit or loss attributable to the Group in a period by the weighted average number
of shares in circulation during the period, excluding the average number of treasury shares held during the same period.
In accordance with this:
31/12/2014
31/12/2013
Net Profit/(Loss) for the year (€000s)
(9,550)
(39,818)
Weighted average number of shares in circulation (thousands)
319,284
295,228
Basic Earnings per share in euros
(0.03)
(0.13)
Diluted earnings per share are established on a similar basis to basic earnings per share; however, the weighted average number of shares outstanding
is increased by options on shares, warrants and convertible debt.
31/12/2014
31/12/2013
Net Profit/(Loss) for the half-year (€000s)
(9,550)
(39,818)
Weighted average number of shares with dilutive effect (in thousands)
370,107
337,975
Diluted Earnings per share in euros
(0.03)
(0.12)
6.- GOODWILL
The balance included under this item corresponds to the net goodwill arising from the acquisition of certain companies, and breaks down as follows
(€000s):
REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS
