As at December 31, 2020, 2019 and 2018 the equity attributable to owners of the Company is analysed as follows:

	31/12/20		31/12/19		31/12/18
Share capital		54,853		54,853		54,853
Reserves		13,043		17,147		17,198
Retained earnings		6,448		31,126		64,496
Total		74,344		103,126		136,547

As at December 31, 2020 and 2019, the Company’s share capital, which is totally authorized and issued, is composed of 54,853,045 ordinary shares with par value of Euro 1 each, for a total of 54,853.

Ordinary shareholders have the right to receive dividends, as approved by shareholders’ meetings, and to express one vote per each share owned.

	31/12/20			31/12/19			31/12/18
Mr. Pasquale Natuzzi		56.5	%		56.5	%		56.5	%
Mrs. Anna Maria Natuzzi		2.6	%		2.6	%		2.6	%
Mrs. Annunziata Natuzzi		2.5	%		2.5	%		2.5	%
Other investors		38.4	%		38.4	%		38.4	%
Total		100.0	%		100.0	%		100.0	%

	31/12/20			31/12/19			31/12/18
Legal reserve		10,971			10,971			10,971
Majority shareholder capital contribution		488			488			488
Foreign operations translation reserve		1,954			5,846			5,282
Remeasurement of defined benefit plan		(370	)		(158	)		457
Total		13,043			17,147			17,198

The “Legal reserve” is connected to the requirements of the Italian law, which provide that 5% of net income of the Parent Company is retained as a legal reserve, until such reserve is 20% of the issued share capital. The legal reserve may be utilized to offset losses; any portion which exceeds 20% of the issued share capital is distributable as dividends. The legal reserve totaled 10,971 as at December 31, 2020, 2019 and 2018.

The “Majority shareholder capital contribution” is one of the Parent Company’s reserves, which is restricted for capital grants received.

The “Foreign operations translation reserve” relates to the translation of foreign subsidiaries’ financial statements for those subsidiaries which have assessed their functional currency being different from Euro.

The “remeasurement of defined benefit plan” refers to the calculation of the present value of the employees’ leaving entitlement at each reporting date, in compliance with applicable regulations and adjusted to take into account actuarial gains or losses. In particular, such actuarial gains or losses are reported in OCI (see note 4 (q)).

The disaggregation of changes of OCI by each type of reserve in equity is shown in the tables below.

	Foreign operations translation reserve			Remeasurement of defined benefit plan			Total
Exchange difference on translation of foreign operations		(3,575	)		—			(3,575	)
Share of OCI of equity-method investees		(373	)		—			(373	)
Actuarial gains on employees’ leaving entitlement		—			(212	)		(212	)
Total		(3,948	)		(212	)		(4,160	)

	Foreign operations translation reserve		Remeasurement of defined benefit plan			Total
Exchange difference on translation of foreign operations		475		—			475
Share of OCI of equity-method investees		111		—			111
Actuarial losses on employees’ leaving entitlement		—		(615	)		(615	)
Total		586		(615	)		(29	)

	Foreign operations translation reserve			Remeasurement of defined benefit plan		Total
Exchange difference on translation of foreign operations		497			—		497
Share of OCI of equity-method investees		(246	)		—		(246	)
Actuarial gains on employees’ leaving entitlement		—			573		573
Total		251			573		824

The Group’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors the return on capital, as well as the level of dividends to ordinary shareholders.

The Group monitors capital using a ratio of “net debt” to “equity”. Net debt is calculated as total liabilities (as shown in the consolidated statement of financial position) less cash and cash equivalents. Equity comprises all components of equity. As at December 31, 2020, the Group’s policy is to keep the ratio below 3.20.

The Group’s net debt to equity ratio as at December 31, 2020 and 2019 is as follows:

	31/12/20			31/12/19
Total liabilities		280,636			264,576
Less cash and cash equivalents		(48,187	)		(39,799	)
Net debt (a)		232,449			224,777
Total equity (b)		75,364			104,818
Net debt to equity ratio (a/b)		3.08			2.14