IBERSOL Annual Report and Consolidated Accounts 2017

Consolidated Financial Statements IBERSOL SGPS, S.A. ANNEX TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED ON 31 DECEMBER 2017 (Values in euros) 1. INTRODUCTION IBERSOL, SGPS, SA (“Company” or “Ibersol”) has its head office at Praça do Bom Sucesso, Edifício Península n.º 105 a 159 – 9º, 4150-146 Porto, Portugal. Ibersol’s subsidiaries (jointly called the Group), operate a network of 646 units in the restaurant segment through the brands Pizza Hut, Pasta Caffé, Pans & Company, Ribs, FresCo, SantaMaria, Kentucky Fried Chicken, Burger King, O’ Kilo, Roulotte, Quiosques, Pizza Móvil, Miit, Sol, Sugestões e Opções, Silva Carvalho Catering e Palace Catering, coffe counters and other concessions. The group has 502 units which it operates and 144 units under a franchise contract. Of this universe, 312 are headquartered in Spain, of which 177 are own establishments and 135 are franchised establishments, and 10 in Angola. As a result of the purchase of the Eat Out group (note 5.2.1) in 2016, the consolidated statements of comprehensive income and cash flows for 2017 include 12 months of activity, against the two months in 2016, so that the general headings had significant increases. Ibersol is a public limited company listed on the Euronext of Lisbon. Ibersol SGPS parent company is ATPS - SGPS, S.A . 2. MAIN ACCOUNTING POLICIES The main accounting policies applied in preparing these consolidated financial statements are described below. 2.1 PRESENTATION BASIS These consolidated financial statements were prepared according to the International Finan- cial Reporting Standards (IFRS), as applied in the European Union and in force on 01 January 2017. The consolidated financial statements have been prepared in accordance with the historical cost principle, changed to fair value in the case of derivative financial instruments. Except for the application of IAS 29 in 2017, the accounting policies adopted at 31 December 2017 are the same as those adopted in the preparation of the financial statements as at 31 December 2016. The effects of applying IAS 29 are set out in Note 36. The preparation of the financial statements requires estimates and management judgments, as disclosed in Note 4. 208