Management Report 2020
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Management Report 2020
d) Legal reserve
The legal reserve is established on the basis of 5% of the net profit for the year
limited to 20% of the share capital. As provided for in the Bylaws in article 35, par-
agraph a, in the fiscal year in which the balance of the legal reserve plus the
amounts of the capital reserves referred to in paragraph 1 of article 182 of Law
6,404/76 exceeds thirty percent (30%) of the capital stock, it shall not be mandatory
to allocate part of the net profit of the fiscal year to the legal reserve. For the year
ended December 31, 2020, the Company constituted a legal reserve of R$ 24,425.
e) Reserve for expansion
According to the provisions of Article 194 of Law 6,404/76 and Article 35 of the
Company's Bylaws, a Reserve for Expansion shall be formed based on the remain-
ing profit after the legal and statutory deductions, for the purpose of investing in
operating assets or capital expenditures, this reserve may not exceed the amount
of capital stock. For the year ended December 31, 2020, the Company set up an
expansion reserve of R$ 230,489.
f) Profit retention reserve
The balance at December 31, 2020 and December 31, 2019 refers to the re-
maining balance of retained earnings for the year 2007, which was retained
as a profit retention reserve for the realization of new investments, provided
for in a capital budget approved by the Board of Directors, in accordance with
article 196 of Law 6,404/76.
g) Incentive investment reserve
It corresponds to tax benefits granted by the states of Mato Grosso do Sul, Mato
Grosso and Goiás for the reduction in the amount of ICMS to be collected from 70%
to 75%, in the form of a presumed credit, for the operations of cotton, cotton seed
and corn, classified as investment subsidy. For the year ended December 31, 2020,
the Company set up a tax incentive reserve of R$ 171.
h) Dividends
According to the Bylaws, the minimum mandatory dividend is calculated on the
basis of 25% of the net profit remaining for the year, after the reserves established
by law have been constituted.
SLC
Agrícola
The composition of the proposed dividend calculations and interest on equity for
the year ended December 31, 2020 and dividends distributed on December 31,
2019, was as follows:
Net income for the year
Appropriation of investment reserve incentivized
Appropriation of legal reserve
Calculation base for the dividends proposed
Minimum compulsory dividend-25%
Additional dividend proposed-25% (a)
Proposed dividends
Dividend per share (excluding treasury shares)
% on the basis
12/31/2020
488,674
(171)
12/31/2019
311,514
(939)
(24,425)
(15,575)
464,078
295,000
116,020
73,753
116,019
73,749
232,039
147,502
1.236982
0.7739
50%
50%
(a). Management proposal to be resolved at the Annual Shareholders' Meeting, scheduled to take
place in April 2021.
The mandatory minimum dividends are made up as follows:
Distribution of interest on own capital (IE)
(-) IRRF on interest on own capital
Dividend
Total IE distributed
Minimum compulsory dividends per share (ex-treasury)
% on net income from dividends and interest on own capital
i) Earning per share
12/31/2020
37,117
(4,770)
83,673
116,020
0.618496
50%
In accordance with CPC 41 - Earnings per Share (IAS 33), the following table
reconciles the net income for the period with the values used to calculate basic
and diluted earnings per share.
The Company has a category of dilutive potential common shares that refer to
stock option plans. For these stock option plans, a calculation is made to deter-
mine the number of shares that could have been acquired at fair value (deter-
mined as the average annual market price of the Company's stock) based on the
monetary value of the subscription rights attached to the stock option plans.
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