Annual report (20-F) - Ono

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allowed as a refund or credit against such beneficial owner’s U.S. federal income tax liability provided the required information is furnished to the IRS in a timely manner. F. Dividends and Paying Agents Not applicable. G. Statement by Experts Not applicable. H. Documents on Display We are required to file reports, including this annual report on Form 20-F, and other information with the Securities and Exchange Commission, or SEC. We are allowed to “incorporate by reference” the information we file with the SEC. This permits us to disclose important information by referring to these documents. These reports and other information can also be inspected without charge and copied at prescribed rates at the public reference facilities maintained by the Securities and Exchange Commission in Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the regional office of the Securities and Exchange Commission located at the Northwest Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of this material are also available by mail from the Public Reference section of the Securities and Exchange Commission, at 450 Fifth Street, N.W., Washington, D.C. 20549. I. Subsidiary Information For information on our subsidiaries, please see the section entitled Item 18. “Financial Statements”. Item 11. Quantitative and Qualitative Disclosure about Market Risk Market risk represents the risk of changes in the value of financial instruments, derivative or nonderivative, caused by fluctuations in foreign currency exchange rates and interest rates. It is our treasury policy to monitor and manage exposure to variable interest rate risk and foreign currency exchange rate risk by managing the amount of our outstanding variable interest bearing debt and foreign currency liabilities. In order to reduce such interest rate risk and foreign currency exchange rate exposure, and as market conditions warrant, we and our affiliates may enter into currency or interest rate hedging transactions and may purchase or trade the Notes from time to time in privately negotiated or open market transactions using funds available to us. Interest Rate Sensitivity Borrowings under our cancelled 2001 senior bank facility and under our 2005 senior bank facility bear interest at a floating rate determined by reference to EURIBOR plus a margin, which both, as of December 31, 2004 and currently range from 2.5% to 4.5% depending on the tranche. In addition, our other outstanding debt with credit entities, usually bear interest at EURIBOR plus a margin. Moreover, as part of our refinancing transactions, on May 17, 2004 ONO Finance issued €100 million floating rate notes priced at three months EURIBOR plus an 8.5% margin which were lent to us in the same terms. Accordingly, as at December 31, 2004 we had variable interest rate long-term debt outstanding of €745.0 million and exposure to risk due to fluctuations of interest rates. Historically, we have not entered into interest rate swap agreements to hedge our exposure to variable interest rate obligations. However, under the terms of our 2005 senior bank facility we have committed to cover, prior to August 9, 2005, our risk under at least 50% of our interest rate exposure under tranches A and B of the 2005 senior bank facility for at least three years. Accordingly, it is our current intention to enter into interest rate hedging transactions with respect to some or all of our variable interest rate debt. 94
The table below shows the variable interest long-term debt as of December 31, 2004. Expected maturity date (EUR in millions) 2005 2006 2007 2008 2009 Thereafter Total Euro millions Fair value 2001 senior bank facility (Euribor + 2.50% - 4.50%)(1) — (70.) (305) (270) — — (645.0) (645.0) 2014 EUR Floating Rate Notes (Euribor + 8.5%) — — — — — (100.0) (100.0) (100.0) (1) Interest payments on the 2001 senior bank facility are not disclosed. Principal amounts under the 2001 senior bank facility relate to the outstanding principal amount as at December 31, 2004. All of these amounts have been repaid in full in February 2005 at the refinancing of the 2001 senior bank facility (see “Item 10. The 2005 senior bank facility”. Foreign Exchange Rate Sensitivity 2011 USD Notes The table below shows the annual payments of interest and principal on our outstanding foreign currency denominated debt. Expected maturity date Fair 2005 2006 2007 2008 2009 Thereafter Total value(1) (USD in millions) (euro in millions) Interest payments on the 2011 USD Notes (8.25) (8.25) (8.25) (8.25) (8.25) (12.37) (53.62) 2011 USD Notes — — — — — (58.92) (58.92) (49.7) (1) Fair value of the relevant Notes has been calculated applying the official exchange rate published by the ECB on December 31, 2004 of €1.00 = U.S.$1.3621 to the market value of the principal on the relevant Notes as of December 31, 2004. Cross-currency Swap Agreement on the 2011 USD Notes On July 3, 2002, we reached an agreement to hedge 50% of the foreign exchange exposure on interest payments on the original issue amount of the 2011 USD Notes, from February 13, 2003 to February 13, 2006. Under this agreement, the counterparty agreed to pay us interest at an annual rate of 14% on $100 million and we agreed to pay interest at an annual rate of 14.365% on €102.2 million on the same dates. On June 10, 2004, as a consequence of the cancellation of a significant part of the 2011 USD Notes, the cross-currency swap was reduced with the purpose of hedging 100% of the exposure on interest payments on the outstanding 2011 USD Notes. The principal outstanding amount of the 2011 USD Notes is $58.9 million. The costs of the partial swap unwind amounted to €2.5 million. The following table sets forth a calculation of the expected cash flows of our cross-currency swap agreements as of December 31, 2004 (at the official exchange rate published by the ECB of dollar 1.3621 per euro 1.00): 95
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SECURITIES AND EXCHANGE COMMISSION
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“RGUs” are revenue generating u
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CONTENTS Clause Item 1. Identity of
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PART I Item 1. Identity of Director
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Reconciliation between EBITDA and n
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The table below shows the high and
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significant qualifications and exce
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• consolidate our brand in the ma
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operating and financial performance
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the products and services we offer
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• our ability to access the finan
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In March 2005, Cableuropa performed
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Our Strategy experience with cable
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We offer the following bundled serv
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Digital Television The introduction
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annual revenue of around €1 milli
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them are trained in our specific in
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• Andalucía Cluster. The Andaluc
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• Television line-up. Sogecable h
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In accordance with the General Law
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Telecommunications further requires
Page 43 and 44: Obligations According to the releva
Page 45 and 46: second telephony lines. The network
Page 47 and 48: Address Current Use Size (square me
Page 49 and 50: Address Current Use Size (square me
Page 51 and 52: The following are the key factors a
Page 53 and 54: The following table sets forth reve
Page 55 and 56: The following table sets forth cert
Page 57 and 58: total revenues to 28.6% for the yea
Page 59 and 60: Net Extraordinary Income/(Expense)
Page 61 and 62: needed before commercial launch of
Page 63 and 64: Net cash provided by financing acti
Page 65 and 66: A number of these contracts are sub
Page 67 and 68: All decisions regarding our busines
Page 69 and 70: Leopoldo Calvo-Sotelo became an ind
Page 71 and 72: Audit and Compliance Committee GCO
Page 73 and 74: E. Share Ownership Currently none o
Page 75 and 76: The shareholders’ agreement provi
Page 77 and 78: Dividend and Liquidation Rights Pay
Page 79 and 80: • the aggregate increases approve
Page 81 and 82: As security for the senior bank fac
Page 83 and 84: The Indentures also provide for eve
Page 85 and 86: par value shares and subject to adj
Page 87 and 88: Where interest has been paid under
Page 89 and 90: the avoidance of double taxation. H
Page 91 and 92: possible application of the passive
Page 93: a sale, exchange, retirement or dis
Page 97 and 98: Item 16C. Principal Accountant Fees
Page 99 and 100: No. 333-10976)). (Now superseded.)
Page 101 and 102: Form F-4 (File No. 333-109976)). 4.
Page 103 and 104: INDEX TO THE CONSOLIDATED FINANCIAL
Page 105 and 106: CABLEUROPA, S.A.U. AND SUBSIDIARIES
Page 107 and 108: CABLEUROPA, S.A.U. AND SUBSIDIARIES
Page 109 and 110: Other subsidiaries: Company Name He
Page 111 and 112: d) Foreign exchange rate options Fo
Page 113 and 114: Had the life of this debt not been
Page 115 and 116: 6. Start-up costs Euro thousand Bal
Page 117 and 118: ) Finance leases Computer hardware
Page 119 and 120: 9. Financial assets Euro thousand B
Page 121 and 122: The detail of short and long term d
Page 123 and 124: Cancellation in 2003 of MBCF relate
Page 125 and 126: (e) State Subsidies Starting in 200
Page 127 and 128: Options granted under the Phantom P
Page 129 and 130: (c) Reserves (accumulated losses) i
Page 131 and 132: (c) The movement in deferred tax as
Page 133 and 134: In 2004, 2003 and 2002, the Group
Page 135 and 136: Transactions Services received Serv
Page 137 and 138: Euro thousand 2004 2003 Audit servi
Page 139 and 140: Euro thousand 2004 2003 2002 Change
Page 141 and 142: Reconciliation of net profit / (los
Page 143 and 144: Management of the Group considered
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(n) Start-up costs. Under Spanish G
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Amortization expense related to int
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(h) Leases The group leases certain
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Annual report (20-F) - Ono

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