5. Other net operating income/(losses)
This caption includes all operating expenses and income other than those associated with the Group’s commercial and logistics activity, which are included under “Operating expenses” in the consolidated income statement, as described in the previous note.
This caption includes mainly changes in the prices of the debts recognized as a result of the existence of cross call and put options between the Group and the owners of some of the shares of certain of the subsidiaries, since these cross options are considered to be a deferred acquisition of the shares constituting the underlying (see note 20). These changes in prices arise basically as a result of the fact that the prices are tied to the number of stores operated, equity and the profit or loss of the subsidiaries in question.
Following is a description of the main cross put and call options on those investments:
a) Subsidiaries domiciled in Mexico
The Group holds call options on 5% of the share capital of Zara México, S.A. de C.V., on 3% of the share capital of Bershka México, S.A. de C.V., on 1.5% of the share capital of Oysho México, S.A. de C.V., on 1.5% of the share capital of Pull & Bear México, S.A. de C.V., on 1.5% of the share capital of Zara Home México, S.A. de C.V. and on 2% of the share capital of Massimo Dutti México, S.A. de C.V. owned by a non-controlling shareholder.
b) Subsidiaries domiciled in Korea
The Group holds a call option on 20% of the share capital of Zara Retail Korea, Ltd. This ownership interest is held by Lotte Shopping Co., Ltd., which in turn holds an option to sell the full amount of this holding to Industria de Diseño Textil, S.A.
c) Subsidiaries domiciled in South Africa
The Group holds a call option on 10% of the share capital of ITX Fashion Retail South Africa (Proprietary), LTD. This ownership interest is held by Peter Vundla Retail (Propietary), LTD, which in turn holds an option to sell the full amount of this holding to Industria de Diseño Textil, S.A.
d) Subsidiaries domiciled in Australia
The Group holds a call option on 20% of the share capital of Group Zara Australia, PTY. LTD. This ownership interest is held by International Brand Management, PTY. LTD., which in turn holds an option to sell the full amount of this holding to Industria de Diseño Textil, S.A.
