MONCLER ANNUAL REPORT AT 31 DECEMBER 2020SEPARATE FINANCIAL STATEMENTS 159158
3.
COMMENTS ON THE INCOME STATEMENT
3.1. REVENUE
The company s revenues mainly include royalty income from the use of Moncler trademark and management fees.
The decrease of 34,738 thousand euros when compared to the prior year is due to the reduction of business volume, due to the effects of Covid-19 pandemic.
3.2. GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative expenses amounted to 39,637 thousand euros (37,503 thousand euros in 2019) and primar- ily include designing and product development expenses in the amount of 10,763 thousand euros (10,157 thousand eu- ros in 2019), the personnel expenses of other functions in the amount of 9,663 thousand euros (7,555 thousand euros in 2019), legal, financial and administrative expenses in the amount of 2,250 thousand euros (1,870 thousand euros in 2019), directors fees in the amount of 2,308 thousand euros (4,002 thousand euros in 2019), auditing and attestation ser- vice, statutory auditors expenses, costs for supervisory body and internal audit in the amount of 404 thousand euros (429 thousand euros in 2019).
This item also includes costs related to stock-based com- pensation plans for 7.958 thousand euros (6.402 thousand eu- ros in 2019).
3.3. MARKETING EXPENSES
Marketing expenses amounted to 40,452 thousand euros (45,383 thousand euros in 2019) and are mostly made up of expenses related to media-plan and events. The decrease of the item in respect to last year is also due to the selection and focus of all marketing projects decided after the Covid-19 outbreak.
To support the Milanese community during the pandem- ic, the Company also decided to allocate approximately 10 million euros to support social initiatives including the crea- tion of a home healthcare programme and the digitization of primary and secondary schools.
3.4. PERSONNEL EXPENSES, DEPRECIATION AND AMORTISATION
The total personnel expenses, included under general and ad- ministrative expenses, amounted to 12,463 thousand euros (9,755 thousand euros in 2019) including social security con- tribution and leaving indemnity expenses. The average number of FTE ( full-time-equivalent ) in 2020 was 111 (88 in 2019). In 2020 depreciation and amortisation amounted to 1,148 thousand euros (1,364 thousand euros in 2019).
3.5. FINANCIAL INCOME AND EXPENSES
The caption is broken down as follows:
The caption interest expenses and bank charges mainly refers to the interests accrued on the correspondent account with the subsidiary Industries S.p.A. In 2020 and 2019 the company did not received dividends.
3.6. INCOME TAX
The tax impact on the income statement is detailed as follows:
Deferred taxes in 2020 include the release deriving from the realignment of the Moncler trademark s tax value to the statutory value. Current taxes in 2019 were affected by the registration of the tax credit relating to the tax relief of the Patent Box for 2019 and to research and development for 2018. The reconciliation between the theoretical tax burden by applying the theoretical rate of the Parent Company, and the effective tax burden is shown in the following table:
The caption Other differences in 2020 mainly includes the benefit deriving from the release of deferred tax liabilities resulting from the realignment of the Moncler trademark s tax value to the statutory value, net of the relative substitute tax. This item also includes current IRAP and the tax credit relating to research and development. The caption Other differences in 2019 mainly referred to the recognition of the above mentioned tax credit relative to the Patent Box tax relief and to the current IRAP and for the tax credit related to the research and development.
(Euro/000) 2020 2019
Interest income and other financial income 337 161
Foreign currency differences - positive 84 0
Total financial income 421 161
Interests expenses and bank charges (322) (407)
Foreign currency differences - negative 0 (147)
Total financial expenses (322) (554)
Total net excluded interests on lease liabilities 99 (393)
Interests on lease liabilities (31) (10)
Total net 68 (403)
(Euro/000) 2020 2019
Current income taxes (48,470) (32,379)
Deferred tax income (expenses) 63,420 (22)
Income taxes charged in the income statement 14,950 (32,401)
Reconciliation theoretic-effective tax rate (Euro/000)
Taxable Amount
2020 Tax Amount
2020 Tax rate
2020
Taxable Amount
2019 Tax Amount
2019 Tax rate
2019
Profit before tax 158,980 190,051
Income tax using the Company's theoretic tax rate (38,155) 24.0% (45,612) 24.0%
Temporary differences 16 0.0% 1 (0.0)%
Permanent differences (755) (0.5)% (395) 0.2%
Other differences 53,844 33.9% 13,605 (7.2)%
Income tax at effective tax rate 14,950 -9.4% (32,401) 17.0%
