2020 Annual Report slide image

2020 Annual Report

1) 2020 ANNUAL REPORT CONSOLIDATED FINANCIAL STATEMENTS Total from the last page Line of credit up to the principal sum of $8,080 (USD 460,000) with Banco Banamex, S.A., a full service banking institution, contracted on January 22, 2016 and maturing on January 22, 2021, with a Libor rate plus 1.8 basis points. Loan available on demand in a single payment from Banco Banamex, S.A., a full service banking institution, for a maximum amount of $90,000, signed on March 9, 2016, with a monthly TIIE interest rate plus an applicable margin of 0.75 percentage points, and a March 9, 2020 maturity date. Loan available on demand in a single payment from Santander, S.A., a full service banking institution, for a maximum amount of $190,000, with a monthly TIIE interest rate plus an applicable margin of 0.40 percentage points, and a December 19, 2020 maturity date. Unsecured loan for $45,000 with Scotiabank Inverlat, S.A., a full service banking institution, for the acquisition of assets signed on April 11, 2017. Of which a first amount of $20,000 was withdrawn on 11 April 2017, plus a second withdrawal for $5,000 on May 17, 2017; plus a third withdrawal for $20,000 on July 11, 2017; effective for 60 months, and accruing monthly interest at the TIIE rate plus 2 percentage points due in April 2022, which is paid in advance on 11 November 2020. Total bank loans Minus - Short-term portion of long-term bank loans Bank loans with maturities greater than one year 2020 2019 $ 6,358,954 6,415,110 459 2,170 5,625 63,333 MEGACABLE. In relation to the loans indicated in the previous paragraph, the Group determined an effective interest rate in 2020 of 7.88%, 6.88%, 7.89% and for the last three 6.88%, respectively, on which the financial cost of said loan is recorded. In like manner, the fair value for all loans is $6,808,329, which was determined by using the discount rate at fixed market value and TIIE plus 0.28% percentage points, and is within level 2 in the fair value hierarchies. In relation to the loans indicated in the previous paragraph, the Group determined an effective interest rate in 2019 of 7.88%, 7.84%, 7.89% and for the last three 7.84%, respectively, on which the financial cost of said loan is recorded. In like manner, the fair value for all loans is $6,404,319, which was determined by using the discount rate at fixed market value and TIIE plus 0.28% percentage points, and is within level 2 in the fair value hierarchies. The current loan agreements establish different obligations to do and not do for Megacable Holdings and its subsidiaries, including limitations to: (a) merge or consolidate with third parties; (b) sell, transfer or lease some of its assets, except in the case of a cash transaction; (c) certain investments; (d) the amount of indebtedness; (e) certain dividend payments or distributions of the capital stock of Megacable Holdings or its subsidiaries, or the purchase, redemption or other acquisition of the capital stock of any of its subsidiaries; (f) enter into hedging contracts, unless they help mitigate certain risks or acquire benefits; and (g) changes in accounting, as well as requiring Megacable Holdings and subsidiaries to comply with certain financial ratios, including a consolidated leverage rate not greater than 3.00 and a consolidated interest coverage rate greater than 3.50. The exposure of the Group's loans to changes in interest rates and contractual dates is as follows: 2020 2019 21,531 Less than 6 months From 6 to 12 months More than 1 year up to 5 years 6,359,413 6,507,769 459 79,922 The book value and fair value of the long-term loans is as follows: 6,358,954 6,427,847 459 6,358,954 6,359,413 16,589 63,333 6,427,847 6,507,769 Book value Fair value 2020 2019 2020 2019 On July 25, 2019, Mega Cable, S.A. de C.V. as an accredited subsidiary and Megacable Holdings, S.A.B. de C.V., Telefonía por Cable S.A. de C.V., Servicios Especiales Turandot, S.A.P.I de C.V., and Werther Administración Integral, S.A.P.I. de C.V., as joint and several obligors, took out loans with Scotiabank Inverlat, S. A. for $2,000,000 and $1,000,000, BBVA Bancomer, S.A. for $1,500,000 and $975,000, Banco Santander, S.A. for $500,000, and Banco Nacional de México, S. A. for $500,000. These contracts mature on July 29, 2022 and July 29, 2024. Loans $ 6,358,954 6,427,847 6,808,329 6,404,319 Fair values are based on discounted cash flows using the discount rate calculated by Management and are within level 2 in the fair value hierarchies. 63 83
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