interim financial report

Transcription

INTERIM FINANCIAL REPORT
FIRST HALF-YEAR 2011
Contents
1
2011 interim management report
2
1.1
1.2
1.3
1.4
1.5
1.6
1.7
1.8
2011 first-half sales and consolidated results highlights
Results by division
Other items of consolidated income
Main cash flows over the period
Consolidated balance sheet
Other significant events during the first half of 2011
Related-party transactions
Risks and uncertainties with regard to the second half
of 2011
Outlook
Financial calendar
2
3
5
6
6
7
7
1.9
1.10
2
Condensed Interim Consolidated
Financial Statements
2.1
2.2
2.3
2.4
2.5
2.6
Consolidated income statement
Consolidated statement of comprehensive income
Consolidated statement of cash flows
Consolidated statement of changes in equity
Notes to the Condensed Interim Consolidated
7
8
8
9
10
12
12
13
14
15
3
Statutory Auditors’ review report
26
4
Certificate by the persons responsible
27
1
Six months ended June 30, 2011
Important legal information and cautionary statements
The Condensed Interim Consolidated Financial Statements for the six months ended June 30, 2011 presented in this document have
been approved by the Management Board, reviewed by the Audit Committee and approved by the Supervisory Board of Saft.
Certain statements contained herein are forward-looking statements relating, in particular, to future events, trends, plans or objectives.
By their nature, these forward-looking statements involve known or unknown risks and uncertainties that could cause Saft’s actual
results and objectives to differ materially from those expressed or implied in these forward-looking statements.
Saft 2011 Interim financial report
1
1
2011 first-half sales and consolidated results highlights
first half-year 2011
1.1 2011 FIRST-HALF SALES AND CONSOLIDATED
RESULTS HIGHLIGHTS
Six months
Six months
ended
ended
June 30, 2011 June 30, 2010
(in € million)
Sales
311.6
290.0
9.8%
93.9
89.8
4.6%
30.1%
31.0%
Gross profit
Gross profit %
Six months
2011/2010
ended
% Change June 30, 2009
EBITDA (1)
54.5
54.2
EBITDA %
17.5%
18.7%
2010/2009
% Change
287.4
(0.4)%
82.6
8.7%
28.7%
0.5%
51.5
5.2%
17.9%
EBIT (2)
39.5
38.8
EBIT %
12.7%
13.4%
Profit before income tax
20.7
27.6
(25.0)%
27.4
0.7%
Net income
15.8
22.8
(30.7)%
21.6
5.6%
0.62
0.92
(32.6)%
1.03
(10.7)%
EPS (€ per share)
(3)
1.8%
35.7
8.7%
12.4%
Percentage changes are at actual exchange rates except for sales which are at constant exchange rates.
(1) EBITDA is defined as operating profit, before depreciation, amortisation, restructuring costs and other operating income and expenses.
(2) EBIT is defined as operating profit, before restructuring costs and other operating income and expenses.
(3) 2009 EPS has been restated to factor in the capital increase with maintained preferential subcription rights carried out in December 2009. 2009 EPS before restatement was
€1.14.
Group first-half sales for 2011 amounted to €311.6 million, up by
7.4% as compared to the first half of 2010 at current exchange rates
and by 9.8% at constant exchange rates.
After sales for Q1 2011 of €150.7 million, sales of €160.9 million
were recorded in Q2 2011, a 9.5% increase compared to those for
Q2 2010, at constant exchange rates, and a 4.2% increase at actual
exchange rates. This is an excellent performance in light of a less
favorable 2010 comparison base than in the first quarter.
Gross margin in the first half stood at €93.9 million, a gross margin
rate of 30.1% against a gross margin rate of 31.0% in H1 2010. The
slight decrease in gross margin rate was due on the one hand to the
€2.2 million impact of costs related to the construction and start of
production of the Jacksonville plant for the first half of 2011, against
a net impact of €0.3 million in H1 2010 and, on the other hand, to
foreign exchange and nickel price headwinds.
2
EBITDA margin for the first half of 2011 was €54.5 million,
representing 17.5% of sales, at the top of the initial annual forecast.
Restated excluding the €3.2 million ($4.5 million) costs related
to the construction of the new Li-ion production facility in
Jacksonville, EBITDA margin for H1 2011 amounted to 18.5% of
sales, as compared to a restated EBITDA margin of 18.9% of sales for
H1 2010, the positive impact on profitability of increased volumes
during the first half being offset by the higher cost of nickel and an
overall unfavorable impact of foreign exchange.
EBIT margin in the first half amounted to €39.5 million, representing
12.7% of sales. Adjusted for the impact of Jacksonville, EBIT margin
was 13.7% of sales against an adjusted EBIT margin of 13.6% in
H1 2010.
1
Results by division
The Group’s net profit in the first half of 2011 amounted to
€15.8 million against a net profit of €22.8 million a year earlier. The
decrease in net income reflects, in addition to the impact of the
Jacksonville project described above, the increase to €12.4 million
of the negative contribution of Johnson Controls-Saft joint venture
(against a negative contribution of €6.9 million in H1 2010) and the
anticipated increase in the Group overall tax rate at 23.7% against an
overall tax rate of 17.4% in H1 2010.
Earnings per share amount to €0.62 at June 30, 2011 as compared
with earnings per share of €0.92 at June 30, 2010.
1.2 RESULTS BY DIVISION
SECOND QUARTER SALES BY DIVISION (UNAUDITED)
Change %
Second quarter
2011
(in € million)
Second quarter
2010
At actual
exchange rates
At constant
exchange rates
IBG
89.9
83.6
7.6%
12.9%
SBG
71.0
70.8
0.2%
5.5%
160.9
154.4
4.2%
9.5%
TOTAL
HALF-YEAR RESULTS BY DIVISION
Product line
Sales growth
at constant
exchange
Sales
(in € million)
rates (in %)
EBITDA
EBITDA
margin
(in %)
(in € million)
(in € million)
EBITDA
(in € million)
EBITDA
margin
Sales
(in %)
IBG
177.6
12.7%
25.3
14.2%
160.7
27.0
16.8%
SBG
134.0
6.2%
32.2
24.0%
129.3
29.6
22.9%
0.0
0.0
(3.0)
n.a.
0.0
(2.4)
n.a.
311.6
9.8%
54.5
17.5%
290.0
54.2
18.7%
Other
TOTAL
A)
INDUSTRIAL BATTERY GROUP
(IBG)
At €177.6 million, the division’s sales increased by 12.7% during
the first half of 2011 at constant exchange rates. On a reported
basis, first-half sales are up 10.5% compared with H1 2010. This is
an excellent performance, however, helped by a favorable basis of
comparison.
The pace of growth in activity recorded in the first quarter was
maintained in the second quarter with a sales increase of 12.9% at
constant exchange rates against an increase of 12.4% during the
first quarter.
The main driver of growth during the first half was the stationary
back-up power market whose sales increased by 22.1% over this
period at constant exchange rates, particularly the market segment
of batteries for industrial standby applications.
Sales growth in the transportation market during the first half was
6.4% over the same period of 2010, at constant exchange rates,
with a return to growth in the rail market.
Finally, markets for small nickel batteries (former RBS activities)
recorded a 6.0% reduction in sales at constant exchange rates
during the first half-year, which mainly affected the market for
professional electronics.
All geographic regions posted growth in activity in the first-half,
with Asia, Middle East and also Central and South America having
experienced the strongest growth.
3
1
Results by division
The EBITDA margin for the division amounted to 14.2% of sales
in the first half, compared with a margin of 16.8% in H1 2010.
Excluding net costs of €3.2 million ($4.5 million) incurred for the
Jacksonville project (against a €0.6 net million cost in the first half
of 2010), the EBITDA margin of the division for the first half of 2011
amounted to €28.5 million, or 16.1% of sales, compared with a
restated margin of €27.6 million, or 17.2% of sales in the first half
of 2010. The decrease in the restated EBITDA margin of the division
is due to an overall adverse impact of foreign exchange rates and
an increase in the cost of nickel. The average price of nickel on the
London Metal Exchange reached $25,600 per ton in the first half of
2011 compared with an average price of $21,200 per ton in the first
half of 2010.
B)
SPECIALTY BATTERY GROUP
(SBG)
JOHNSON CONTROLS-SAFT
ADVANCED POWER
SOLUTIONS LLC (JC-S)
On May 18, 2011, Saft was notified that Johnson Controls (JCI) had
filed a petition with the Delaware Chancery Court for the dissolution
of the Johnson Controls-Saft Advanced Power Solutions LLC (JC-S)
joint venture under the Dispute Resolution Provisions set forth in
the Johnson Controls-Saft LLC Shareholders’ Agreement signed in
January 2006.
Johnson Controls Inc. advised that the dispute was based on a wish
to expand the scope of JC-S beyond the limits set within the 2006
Agreement.
On June 3, 2011, Saft filed a motion with the Chancery Court in
Delaware to dismiss the petition for dissolution of Johnson ControlsSaft Advanced Power Solutions LLC (JC-S) because of the absence
of a legitimate reason for dissolution.
SBG division sales over the first six months, amounting to
€134.0 million, increased by 6.2% at constant exchange rates as
compared to H1 2010 and by 3.6% on a reported basis.
The Delaware Chancery Court ruling on the admissibility or rejection
of the petition for dissolution is not expected to occur before the
fourth quarter of 2011.
Despite a less favourable base of comparison than in the first
quarter, sales rose by 5.5% during the second quarter at constant
exchange rates, following an increase of 6.9% registered during the
first quarter.
Pending this first court decision or amicable resolution of this
dispute, the joint venture will continue to honour its commitments,
particularly vis-à-vis its customers.
The good H1 performance resulted from a sharp increase of 22.8%
in the civil activities, at constant exchange rates. Military activities
recorded a reduction in sales of 20.1% during the first half of 2011, at
constant exchange rates but after the good level of orders received,
one can expect growth in these activities in the second half.
All market segments contributed to the increase in civil activities,
which was mainly driven by the United States and Europe. It also
results from the strong growth, as expected, in space activity.
The division’s EBITDA margin for the first half-year has increased
substantially to €32.2 million, at 24.0% of sales compared to an
EBITDA margin of 22.9% during H1 2010. This excellent performance
is due to increased volumes and good cost control.
C)
OTHER ACTIVITIES
Expenses that are not allocated to the operating divisions, which
mainly comprise the costs of the central functions such as IT,
research, finance and administration and central management have
led to an operating loss of €3.4 million for this “Other” cost centre
in H1 2011, as compared with an operating loss of €-2.7 million for
the same period in 2010. The variation is mainly due, on the one
hand, to significant reversals of provisions recorded in the first half
of 2010 which were not repeated in the first half of 2011 and, on the
other hand, to a slight decrease in the amount of research tax credit
recorded in the first half of 2011 compared to the same period in
the previous year.
4
D)
Saft has confidence in the strategy, the technological positioning,
the management and employees of JC-S and sees a profitable
future for the venture as outlined in the current Business Plan. JC-S
has become an important player in the automotive HEV/PHEV/EV
market and has won a number of significant production contracts
with major clients.
The net asset value of JC-S within the balance sheet of Saft as of
end June 2011 is €45.9 million. It consists mainly of Saft share of
the of lithium-ion manufacturing units of Nersac (built in 2007)
and Holland, Michigan, under commissioning, and in capitalized
development projects for which no impairment was identified
following the review conducted as part of the interim accounts.
Accordingly, to date, no evidence suggests that the value of
these assets should be questioned. Accordingly, no provision
was recorded in the consolidated financial statements as at
June 30, 2011 for Saft Group investment in Johnson Controls-Saft
joint venture.
Finally, Saft’s core area of industrial batteries and specialty batteries,
and in particular, its $200 million investment in Jacksonville, Florida,
for the high growth energy storage, telecom network, military and
aviation Li-ion markets are unaffected by this dispute.
From a business standpoint, Johnson Controls-Saft sales for the first
six months are $25.6 million (€18.3 million), compared with sales of
$25.1 million (€18.9 million) in H1 2010.
The joint venture’s total net loss for H1 2011 amounted to
$35.4 million (€25.4 million) against a net loss of $18.7 million
(€14.0 million) in H1 2010. This loss includes costs of managing
the project and start of production for the new Holland-Michigan
production facility for an amount of $9.4 million, against net costs of
$1.7 million in H1 2010.
Other items of consolidated income
Saft’s share in the joint venture’s losses for H1 2011 totalled
€-12.4 million as opposed to a share in losses of €-6.9 million during
H1 2010.
1
Funding of $65.5 million was requested by the joint venture for
H1 2011, with Saft’s contribution amounting to $32.1 million
(€22.9 million).
1.3 OTHER ITEMS OF CONSOLIDATED INCOME
OTHER OPERATING INCOME
AND EXPENSES
Other net operating income and expenses amounted to
€-0.4 million for H1 2011 compared with €1.9 million in H1 2010.
This net income recorded in 2010 corresponds to an insurance
payment received in respect of a past insurance claim.
The Group’s share in Johnson Controls-Saft’s losses thus amounted
to €-12.4 million in H1 2011, compared with €-6.9 million for
H1 2010. The increase in the negative contribution of Johnson
Controls-Saft is mainly due to the impact of charges related to the
construction and start of production of the new factory in Holland,
Michigan, for a net amount of €6.7 million against a limited impact
€1.3 million for the first-half of 2010.
Its share in the net income of the ASB group joint venture amounts
to €0.8 million for H1 2011 compared with €0.7 million in H1 2010.
OPERATING PROFIT
In the absence of significant restructuring charges, and after other
operating income and expenses, the Group’s operating profit
amounts to €39.2 million for H1 2011 compared with €40.3 million
a year ago.
Excluding the costs incurred in connection with construction of
the new Li-ion production facility in Jacksonville, operating income
amounts to €42.5 million, i.e. 13.6% of sales, compared with
€40.9 million, i.e. 14.1% of sales in H1 2010.
INCOME TAX
Income tax expense for H1 2011 amounted to €4.9 million
compared with €4.8 million for H1 2010. At 23.7% for the first half
of 2011, the overall tax rate of the Group is in line with our forecasts,
showing an increase from the overall tax rate of 17.9% recorded in
2010. This increase in the overall tax rate is mainly due to a nonrecurring tax revenue of €1.0 million recorded in the first half of
2010 subsequent to the extension of the tax consolidation regime
in France to Saft Groupe SA.
NET FINANCIAL LOSS
A net financial loss of €6.9 million has been posted for H1 2011 as
opposed to a €6.5 million loss for the first half of 2010. Cost of bank
debt was €6.6 million, showing a €1.2 million reduction year-onyear.
The composite interest rate of the Group’s bank debt, after taking
into account the impact of interest rate hedging transactions, stood
at 3.27% in H1 2011, compared with 4.05% in H1 2010.
NET INCOME
Net income for H1 2011 totals €15.8 million, compared with a net
income of €22.8 in H1 2010.
Earnings per share amounts to €0.62 for the first half of 2011,
compared with EPS of €0.92 in H1 2010.
PROFIT BEFORE INCOME TAX
Profit before income tax amounts to €20.7 million for H1 2011,
showing a €6.9 million reduction compared with the equivalent
period in 2010. Besides finance costs, it includes the Group’s share
in the income or losses of the joint ventures in which the Group is
involved, whose overall contribution was negative by €11.6 million
in the first half of 2011 compared to a negative contribution of
€6.2 million the first half of 2010.
5
1
Main cash flows over the period
1.4 MAIN CASH FLOWS OVER THE PERIOD
CASH FLOWS FROM OPERATING
ACTIVITIES
Net cash flows from operating activities amounted to €27.4 million
over the period, down by €15.1 million as compared with H1 2010.
This change is primarily due to a €13.1 million increase in operating
working capital, and inventories more specifically, in a context of
strong growth in business and in anticipation of the summer break
slowdown in activity.
Finally, as explained above, financing of the Johnson Controls-Saft
joint venture amounted to €22.9 million ($32.1 million) during
H1 2011, compared with €17.0 million ($22.6 million) in H1 2010.
CASH FLOWS FROM FINANCING
ACTIVITIES
CASH FLOWS FROM INVESTING
ACTIVITIES
The only significant cash flows from financing activities for the
first half of 2011 related to the receipt from the US Department
of Energy of its 50% share in financing the costs incurred with
regard to construction of the Jacksonville production facilities, i.e.
€15.2 million ($21.3 million) and to the payment of dividend to Saft
shareholders for an amount of €17.6 million.
Cash flows from investing activities amounted to €66.0 million as
compared to €42.9 million in H1 2010.
In 2010, a €7.4 million dividend was paid duringh the second half
of the year.
Gross industrial capital expenditure amounted to €39.4 million
during H1 2011, of which €30.5 million (i.e. $42.8 million) related
to the construction of the Jacksonville production facility. The
latter amount excludes the 50% funding received from the US
Department of Energy, as analysed below.
FREE CASH FLOW
Investments in intangible assets which are mainly composed
of capitalised development costs amounted to €3.7 million as
compared to €2.9 million during H1 2010.
Due to the increase in operating working capital, free cash flow
(prior to investment in the Johnson Controls-Saft joint venture)
generated by the Group during the first half-year 2011 amounted
to €1.2 million compared to a free cash flow of €24.3 million during
H1 2010.
1.5 CONSOLIDATED BALANCE SHEET
The Group’s balance sheet at June 30, 2011 shows the following:
an increase of €21.6 million in non-current assets, mainly as
a result of the investments in construction of the new Li-ion
production facility in Jacksonville and secondly on the back of
the investments made in the Johnson Controls-Saft joint venture
in Holland, Michigan during the first half of the year;
an increase of €9.6 million in current assets reflecting the
increase in inventories and a €5.8 million decrease in current
liabilities due to reduced tax liabilities;
6
maintenance of an excellent cash position at €151.7 million,
after payment of the dividend for €17.6 million;
an increase of €12.7 million in equity, before dividend payment,
whilst bank debt was reduced by €12.6 million due to a weaker
US dollar against the euro.
Risks and uncertainties with regard to the second half of 2011
1
1.6 OTHER SIGNIFICANT EVENTS DURING
THE FIRST HALF OF 2011
ANNUAL SHAREHOLDERS’ MEETING
AND DIVIDEND
At the Annual Shareholders’ Meeting on May 4, 2011, Saft
Groupe SA’s shareholders set the dividend for FY 2010 at €0.70
per ordinary share. Dividend was paid on May 27 and amounted to
€17.6 million.
INVESTMENT PROJECTS
The construction of the new Li-ion production facility in Jacksonville
is going ahead at the expected pace with start of production
scheduled for the third quarter and the first deliveries to customers
being scheduled during the fourth quarter of 2011.
In addition, the shareholders renewed authorisations to the
Management Board to decide, within certain limits, on the issue of
shares and/or securities giving immediate or future access to the
Company’s share capital.
1.7 RELATED-PARTY TRANSACTIONS
The nature of the Group’s related-party transactions remains
unchanged as compared to the situation described in note 29 of
the 2010 Consolidated Financial Statements, as presented on
page 164 of the 2010 Registration Document registered with the
French financial markets authority (Autorité des marchés financiers)
on February 16, 2011.
The Group’s share in the H1 2011 income or losses of the ASB
and Johnson Controls-Saft joint ventures, which it controls jointly,
is presented in note 8 to the Condensed Interim Consolidated
Financial Statements.
1.8 RISKS AND UNCERTAINTIES WITH REGARD
TO THE SECOND HALF OF 2011
Saft considers that the main risks to which the Group is exposed
are the same as those described on pages 55 to 63 of the 2010
Registration Document, including the risk of a disagreement
between Johnson Controls and Saft about the joint venture Johnson
Controls-Saft Advanced Power Solutions LLC (JCS) as described
above in Section 1.2.D.
situation of some European countries and their impacts on
market segments in which the Group operates;
trends with regard to public procurement contracts;
finally, the changes in exchange rates and particularly that of the
US Dollar and the Swedish Krona as compared to the euro.
The main uncertainties for H2 2011 concern:
trends in the global economic situation, in particularly the
economic situation in the United States and the financial
7
1
Outlook
1.9 OUTLOOK
In light of the Group’s performance during the first half, the sales
growth forecast for full year 2011 has been revised to ≥7% at
constant exchange rates.
EBITDA margin forecast has been maintained at 17.0 to 17.5% as
reported and at 18.0 to 18.5% exluding the impact of the Jacksonville
project, as estimated costs remain unchanged at $10 million for
2011.
FY 2010 (1)
H1 2011 (2)
(in € million)
FY 2011
FY 2011
Initial
Estimate (3)
Revised
Estimate (3)
Sales
591.1
311.6
≥5%
≥7%
EBITDA margin as reported
18.3%
17.5%
17.0 to 17.5%
17.0 to 17.5%
Restated EBITDA margin excluding Jacksonville impact
18.6%
18.5%
18.0 to 18.5%
18.0 to 18.5%
1.33
1.40
1.33
1.40
Average €/$ exchange rate
(1) Impact of the costs related to the construction project of Jacksonville lithium-ion factory was €1.5 million ($2.0 million).
(2) Impact of the costs related to the Jacksonville project was €3.2 million ($4.5 million).
(3) Impact of the costs related to the Jacksonville project estimated at $10 million.
1.10 FINANCIAL CALENDAR
8
Q3 2011 sales
October 27, 2011
Annual sales and results for 2011
February 16, 2012
Condensed Interim Consolidated Financial Statements
2
Condensed Interim
Consolidated Financial Statements
at June 30, 2011
2.1
10
2.2
12
2.3
Consolidated statement of comprehensive income
12
2.4
Consolidated statement of cash flows
13
2.5
14
2.6
Notes to the Condensed Interim Consolidated
15
9
2
2.1 CONSOLIDATED BALANCE SHEET
ASSETS
As of
June 30,
2011
As of
December 31,
2010
As of
December 31,
2009
Intangible assets, net
218.2
222.2
228.2
Goodwill
104.6
110.3
104.8
Property, plant and equipment, net
190.3
166.8
109.9
0.1
0.1
0.2
58.1
49.6
30.0
6.0
6.6
10.1
(in € million)
Note
Non-current assets
Investment properties
Investments in joint undertakings
8
Deferred income tax assets
Other non-current financial assets
0.7
0.8
0.9
578.0
556.4
484.1
89.2
76.5
63.1
151.8
153.7
141.1
0.9
2.1
2.2
Current assets
Inventories
Trade and other receivables
Derivative financial instruments
Cash and cash equivalents
TOTAL ASSETS
10
4
151.7
194.6
207.4
393.6
426.9
413.8
971.6
983.3
897.9
2
LIABILITIES AND EQUITY
As of
June 30,
2011
As of
December 31,
2010
As of
December 31,
2009
Ordinary shares
25.2
25.1
24.7
Share premium
103.2
102.1
92.5
Treasury shares
(1.4)
(0.7)
(0.3)
Cumulative translation adjustments
11.0
24.9
11.8
Fair value and other reserves
11.5
3.1
12.8
Group consolidated reserves
184.1
185.3
164.3
(in € million)
Shareholders’ equity
Note
5
Minority interest in equity
Total shareholders’ equity
2.7
1.4
1.0
336.3
341.2
306.8
315.1
327.7
312.7
6.9
6.1
8.1
Liabilities
Non-current liabilities
Debt
Other non-current financial liabilities
Deferred grants related to assets
38.4
25.5
0.0
Deferred income tax liabilities
6
59.1
60.0
69.0
Pensions and other long-term employee benefits
10.9
9.9
8.5
Provisions for other liabilities and charges
32.8
35.0
33.3
463.2
464.2
431.6
Current liabilities
157.4
156.2
136.4
Taxes payable
Trade and other payables
4.2
8.1
5.3
Debt
2.2
2.3
3.2
Derivative instruments
1.1
1.8
2.1
Pensions and other long-term employee benefits
0.5
1.0
1.0
Provisions for other liabilities and charges
6.7
8.5
11.5
172.1
177.9
159.5
971.6
983.3
897.9
TOTAL LIABILITIES AND EQUITY
4
11
2
2.2 CONSOLIDATED INCOME STATEMENT
(in € million)
Note
Revenues
Cost of sales
Gross profit
Distribution and sales costs
Administrative expenses
Research and development expenses
Restructuring costs
Other operating income and expenses
Operating profit
Finance costs-net
Share of profit/(loss) of associates
Profit before income tax
Income tax expense
Profit for the period
Attributable to:
- Equity holders of the Company
- Minority interest
Earnings per share (in € per share): basic
Earnings per share (in € per share): diluted
Period ended
June 30, 2011
Period ended
June 30, 2010
Period ended
June 30, 2009
311.6
(217.7)
93.9
(19.3)
(24.1)
(11.0)
0.1
(0.4)
39.2
(6.9)
(11.6)
20.7
(4.9)
15.8
290.0
(200.2)
89.8
(18.2)
(21.7)
(11.1)
(0.4)
1.9
40.3
(6.5)
(6.2)
27.6
(4.8)
22.8
287.4
(204.8)
82.6
(17.1)
(21.4)
(8.4)
(0.5)
2.0
37.2
(5.6)
(4.2)
27.4
(5.8)
21.6
15.5
0.3
0.62
0.61
22.8
0.0
0.92
0.92
21.4
0.2
1.14
1.14
Period ended
June 30, 2011
Period ended
June 30, 2010
Period ended
June 30, 2009
15.8
22.8
21.6
(0.8)
13.6
(2.1)
(29.0)
3.0
0.2
0.0
(14.0)
(4.4)
0.0
28.5
10.4
0.9
(0.2)
(1.1)
(5.6)
10.2
7.8
30.6
2.8
24.4
10.0
0.2
30.3
0.3
24.2
0.2
2.3 CONSOLIDATED STATEMENT
OF COMPREHENSIVE INCOME
(in € million)
Profit for the period
Other comprehensive income
Fair value gains/(losses) on cash flow hedge
Fair value gains/(losses), net on investment hedge
Actuarial gains and losses recognised against Statement
of Comprehensive Income
Currency translation adjustments
Tax effect on income/(expenses) recognised directly in equity
Total other comprehensive income for the period,
net of tax
Total comprehensive income for the period
Attributable to:
- Equity holders of the Company
- Minority interest
12
Note
Consolidated statement of cash flows
2
2.4 CONSOLIDATED STATEMENT OF CASH FLOWS
(in € million)
Net profit for the period
Period ended
June 30, 2011
Period ended
June 30, 2010
Period ended
June 30, 2009
15.8
22.8
21.6
12.6
6.2
4.7
4.9
4.8
5.8
15.0
15.4
15.8
Adjustments:
Income tax expense
Property, plant and equipment and intangible assets amortisation
and depreciation
Finance costs-net
Net movements in provisions
Other
Change in inventories
Change in trade and other receivables
Change in trade and other payables
6.9
6.5
5.6
(2.3)
(1.2)
(1.6)
1.1
(0.9)
1.4
54.0
53.6
53.3
(15.9)
(9.1)
6.9
(0.2)
(4.5)
7.6
3.0
13.0
(18.6)
(13.1)
(0.6)
(4.1)
Cash flows generated from operations before interest and tax
40.9
53.0
49.2
Interest paid
(5.4)
(6.8)
(8.5)
Changes in working capital
Income tax paid
(8.1)
(3.7)
0.0
Net cash provided by operating activities
27.4
42.5
40.7
Capital increase of associates
(22.9)
(17.0)
(21.8)
Purchase of property, plant and equipment
(39.4)
(24.4)
(7.7)
(3.7)
(2.9)
(2.2)
0.2
Cash flows from investing activities
Purchase of intangible assets
Proceeds from sale of property, plant and equipment
0.0
1.5
Variation of other non-current financial assets and liabilities
0.0
(0.1)
0.1
(66.0)
(42.9)
(31.4)
2.3
0.1
0.0
(0.7)
(0.7)
0.0
0.0
0.0
(10.2)
15.2
7.7
0.0
0.1
0.0
0.0
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issuance of ordinary shares (a)
Purchase/Sale of treasury shares – liquidity contract
Debt repayments
Grants related to assets
Increase/(decrease) in other long-term liabilities
Dividends paid to Company shareholders
(17.6)
0.0
0.0
Net cash generated by/(used) in financing activities
(0.7)
7.1
(10.2)
Net increase/(decrease) in cash
(39.3)
6.7
(0.9)
Cash and cash equivalents at beginning of period
194.6
207.4
68.8
Exchange gain/(loss) on cash and cash equivalents
CASH AND CASH EQUIVALENTS AT END OF PERIOD
(3.6)
11.2
1.3
151.7
225.3
69.2
(a) Including €1.1 million from capital increase of Indian subsidiary held at 51.04%.
13
2
2.5 CONSOLIDATED STATEMENT OF CHANGES
IN EQUITY
Attributable to equity holders
of the Company
(in € million)
Balance at 01/01/2009
Employee stock option schemes
(value of employee services)
Capital increase with maintenance
of preferential subscription rights
of December 2, 2009
Capital increase by exercise of stock options
Dividend paid
Buyback of treasury shares
Total comprehensive income
Dividend to be paid
Buyback of treasury shares
Payment of dividend in shares
Purchase/Sale of treasury shares
Capital increase of Amco-Saft India Ltd
Dividend paid
Purchase/Sale of treasury shares
BALANCE AT 06/30/2011
14
Number
of shares
making up
the capital Share Capital
18,514,086
5,696,328
231,864
241,815
24,684,093
4,450
24,688,543
410,647
26,650
25,125,840
49,005
25,174,845
Consolidated
reserves
Share and retained
Premium
earnings
Minority Shareholders’
interest
equity
18.5
(27.7)
162.4
0.6
153.8
0.0
0.0
1.6
0.0
1.6
6.0
0.2
0.0
0.0
0.0
24.7
114.4
5.8
0.0
0.0
0.0
92.5
(5.5)
0.0
(7.0)
0.8
36.3
188.6
0.0
0.0
0.0
0.0
0.4
1.0
114.9
6.0
(7.0)
0.8
36.7
306.8
0.0
0.0
0.0
0.0
0.0
24.7
0.0
0,1
0.0
0.0
0.0
92.6
0.6
0,0
(16.8)
(0,7)
30.3
202.0
0.0
0.0
0.0
0.0
0.3
1.3
0.6
0,1
(16.8)
(0,7)
30.6
320.6
0.0
0.4
0.0
0.0
0.0
25.1
0.0
8.9
0.6
0.0
0.0
102.1
0.8
0.1
0.0
0.3
9.4
212.6
0.0
0.0
0.0
0.0
0.1
1.4
0.8
9.4
0.6
0.3
9.5
341.2
0.0
0.1
0.0
0.0
0.0
0.0
25.2
0.0
1.1
0.0
0.0
0.0
0.0
103.2
0.9
0.0
0.0
(17.6)
(0.7)
10.0
205.2
0.0
0.0
1.1
0.0
0.0
0.2
2.7
0.9
1.2
1.1
(17.6)
(0.7)
10.2
336.3
Notes to the Condensed Interim Consolidated Financial Statements
2
2.6 NOTES TO THE CONDENSED INTERIM
CONSOLIDATED FINANCIAL STATEMENTS
Detailed summary of notes to the condensed interim Consolidated Financial Statements
NOTE 1
Information about the Company and the Group
16
NOTE 7
Net finance costs
23
NOTE 2
Accounting policies
16
NOTE 8
Related-party transactions and investments
in joint undertakings
23
NOTE 3
Scope of consolidation
17
Taxes
24
NOTE 4
Information by business segment
and geographical segment
18
NOTE 10 Earnings per share
25
NOTE 5
Shareholders’ equity
22
NOTE 11 Post-balance sheet events
25
NOTE 6
Public subsidies
22
NOTE 9
15
2
NOTE 1
INFORMATION ABOUT THE COMPANY AND THE GROUP
Saft Groupe SA (the “Company”, and collectively with its consolidated
subsidiaries, the “Group” or “Saft”) was formed on March 23, 2005.
Saft Groupe SA, a limited company governed by French law, whose
registered office is at 12, rue Sadi Carnot, 93170 Bagnolet, France, has
been listed on Euronext Paris (Compartment B) since June 29, 2005.
NOTE 2
On July 22, 2011, the Management Board approved and authorised
publication of the Condensed Interim Consolidated Financial
Statements of Saft Groupe SA at June 30, 2011.
Unless otherwise indicated, the Condensed Interim Consolidated
Financial Statements are presented in millions of euros.
ACCOUNTING POLICIES
BASIS OF PREPARATION
OF THE CONSOLIDATED FINANCIAL
STATEMENTS
These Condensed Interim Consolidated Financial Statements for the
half year ended June 30, 2011 have been prepared in accordance
with IAS 34, “Interim financial reporting”. They do not include all
the detailed information required for the full-year consolidated
statements and should be read in conjunction with the Group’s
consolidated annual financial statements for the year ended
December 31, 2010, prepared in accordance with the International
Financial Reporting Standards as approved by the European Union.
The accounting policies applied in these Condensed Interim
Consolidated Financial Statements are identical to those applied by
the Company in its Consolidated Financial Statements for the year
ended December 31, 2010 with the exceptions set out below.
New IFRS standards, interpretations and amendments, as adopted
by the EU for periods beginning from January 1, 2011 onwards, have
been applied by the Company. They have not led to any significant
changes in the methods for measurement of assets, liabilities,
income and expenses.
The Company has not anticipated the implementation of any
standards and interpretations which are not mandatory in 2011.
Within the scope of preparation of the Interim Consolidated
Financial Statements at June 30, 2011, the use of assumptions and
estimates primarily related to the following, as it did at the time
of preparation of the Consolidated Financial Statements for the
financial year ended December 31, 2010:
impairment tests on goodwill and other fixed assets: the Group
carries out impairment tests on unamortised intangible assets
and goodwill during the second half of each year.
As the operating results of the CGUs recognised at June 30,
2011 – excluding the non recurring cost impact of the
construction and start-up of Jacksonville factory – do not
undermine forecasts taken into consideration in the scope of
the sensitivity tests of the value in use of the CGUs carried out
at December 31, 2010, the estimates of the values in use of
the goodwill made as of such date have not been revised when
closing off the interim financial statements.
With regard to brands, the annual impairment tests that are
carried out are based on discounting to present value of the
royalties which would be paid by a third party wishing to use
them, on the basis of sales guidance by brand. As sales for the
first half year of 2011 were consistent with that used to perform
impairment tests on brands by the end of 2010 financial year,
the estimates of the values in use of the brands made as of such
date have not been revised when closing off the interim financial
statements;
calculation of pension and similar retirement benefit obligations:
CRITICAL ACCOUNTING ESTIMATES
AND ASSUMPTIONS
The preparation of the Condensed Interim Consolidated Financial
Statements in conformity with IAS 34 requires management to
make assumptions and estimates that affect the reported amounts
set out in the Financial Statements, whether this involves the
valuation of certain assets and liabilities or certain income and
expenses, such as depreciation, amortisation and provisions.
These estimates, which are based on the going concern assumption,
are prepared on the basis of the available information at the time
of their preparation. They may be revised if the circumstances on
which they have been based change as a result of new information.
Actual results may differ from these estimates.
Where an estimate is revised, this does not correspond to the
correction of an error. The impact of changes in accounting estimates
is recognised for the period in which the change is made if it only
affects such period or for the period in which the change is made and
any subsequent periods that may be affected by the change.
16
for the interim financial statements, pension expenses and
similar retirement benefit obligations are estimated at half the
amount of the annual expense, unless any specific event occurs
to justify a specific update;
some provisions: contingency provisions and in particular
specific provisions for projects are reviewed by Management at
the end of each half-yearly closing;
construction contracts: they are subject to a monthly review as
part of the financial closing at each of the Group business unit.
With regard to current and deferred tax expense recorded in the
interim financial statements, this expense is calculated by applying
the average annual estimated rate of tax for the tax year in process
for each entity or tax group to profit before income tax for the period.
SEASONALITY
Saft’s business is generally not seasonal. However, working capital
tends to be higher in the first half as compared to the second due to
manufacturing shutdowns during the summer months.
NOTE 3
2
SCOPE OF CONSOLIDATION
The scope of consolidation at June 30, 2011 is unchanged compared with December 31, 2009 and comprises the following companies:
Percentage
of control Consolidation
and interest
method
Company name
Activity
Country
Saft Groupe SA
Group Holding Company
France
100
Full
Saft Australia Pty Ltd
Holding company
Australia
100
Full
Saft Batteries Pty Ltd
Assembly and commercial
Australia
100
Full
Commercial
Brazil
100
Full
Manufacturing and commercial
China
100
Full
Saft Do Brazil
Saft Zhuhai (Ftz) Batteries Co., Ltd
Saft Nife ME Ltd
Commercial
Cyprius
100
Full
Saft Ferak AS
Czech Republic
100
Full
Saft SAS (previously Saft SA)
France
100
Full
Holding company
France
100
Full
Manufacturing and sale
of thermal batteries
France
50
EA
Germany
100
Full
Saft Acquisition SAS
ASB (and its subsidiaries)
Friemann und Wolf Batterietechnik GmbH
(Friwo)
Saft Batterien GmbH
SGH GmbH
Tadiran Batteries GmbH
Saft Hong Kong Ltd
Commercial
Germany
100
Full
Holding company
Germany
100
Full
Germany
100
Full
Commercial
Hong Kong
100
Full
Amco-Saft India Ltd
India
51.04
Full
Tadiran Batteries Ltd
Israël
100
Full
Saft Batterie Italia Srl
Commercial
Italy
100
Full
Saft Finance Sarl
Holding company
Luxembourg
100
Full
Saft Batterijen BV
Commercial
Netherlands
100
Full
Commercial
Norway
100
Full
Holding company and commercial
Singapore
100
Full
Saft AS Norway
Saft Batteries Pte Ltd
Saft Baterias SL
Commercial
Spain
100
Full
Alcad AB
Commercial
Sweden
100
Full
Fast Jung KB
Saft AB
Saft Sweden AB
Saft UK Ltd
Florida Substrate Inc. (PPF)
Saft America Inc.
Saft Federal Systems Inc. (Tadiran US)
Saft JV Holding Co
Johnson Controls-Saft Advanced Power
Solutions LLC (and its subsidiaries)
Property investmet company
Sweden
100
Full
Sweden
100
Full
Holding company
Sweden
100
Full
United Kingdom
100
Full
Manufacture of nickel-plated strips
United States
100
Full
United States
100
Full
Commercial
United States
100
Full
Holding company
United States
100
Full
Development, production
and sale of batteries for hybrid
and electric vehicles
United States
49
EA
In the above table above, “Full” signifies that the company is consolidated using the full consolidation method and “EA” (“Equity Accounted”)
means that a company is consolidated using the equity accounting consolidation method.
17
2
NOTE 4
A)
INFORMATION BY BUSINESS SEGMENT
AND GEOGRAPHICAL SEGMENT
rechargeable Li-ion batteries for the electronics, defence and
space industries. The main applications for these products
are satellites, utility meters, automatic meter-reading systems,
electronic toll collection, medical equipment, launchers, missiles,
torpedoes, asset tracking systems, sonar buoys, military radios
and night vision goggles;
INFORMATION BY BUSINESS
SEGMENT
Since July 1, 2009, the Saft Group has been structured around the
following business segments:
the
Industrial Battery Group (IBG) division, which
manufactures rechargeable nickel and lithium batteries and
battery systems for demanding industrial applications such as
aircraft safety, ground-check and starting systems, high-speed
trains, urban transit networks, subways and trams, oil and gas,
industrial installations, power generation and distribution,
hospitals and public buildings, telecommunications networks
and renewable energy storage. The IBG division also produces a
specialised range of small rechargeable nickel batteries to be used
for emergency lighting, professional electronics equipment such
as portable medical devices, payment terminals, private mobile
radio networks and professional audio and video equipment;
the Specialty Battery Group (SBG) division, which designs
and manufactures high-performance primary Lithium and
the Johnson Controls-Saft (JC-S) division, which is specialised
in the development, production and sale of advanced
technology batteries for hybrid and electric vehicles;
the Other segment, which comprises the Group’s holding
companies. It also includes corporate functions such as IT,
research, central management, and finance and administration.
Segment reporting data is based on the same accounting policies as
those used for the Consolidated Financial Statements, as described
in note 2. Performance measurement for each segment is based on
EBITDA, EBIT and operating profit.
The tables below show the main interim financial information for
each of the Group’s divisions.
Operating profit by division
PERIOD ENDED JUNE 30, 2011
(in € million)
Total segment sales
SBG
JC-S
Other
Total
225.8
179.0
0.0
0.0
404.8
Intra-segment sales
(48.2)
(45.0)
0.0
0.0
(93.2)
Consolidated revenues
177.6
134.0
0.0
0.0
311.6
EBITDA
25.3
32.2
0.0
(3.0)
54.5
Amortisation of intangible assets
(2.7)
(3.9)
0.0
(0.1)
(6.7)
Depreciation of property, plant & equipment
(4.0)
(3.7)
0.0
(0.3)
(8.0)
0.0
(0.3)
0.0
0.0
(0.3)
18.6
24.3
0.0
(3.4)
39.5
0.1
0.0
0.0
0.0
0.1
Impairment of Intangible assets
EBIT
Provisions for restructuring
Other operating income/(expenses)
Operating profit
18
IBG
0,0
(0.4)
0.0
0.0
(0.4)
18.7
23.9
0.0
(3.4)
39.2
0.0
0.8
(12.4)
0.0
(11.6)
2
(in € million)
IBG
SBG
JC-S
Other
Total
Total segment sales
202.0
168.3
0.0
0.0
370.3
Intra-segment sales
(41.3)
(39.0)
0.0
0.0
(80.3)
160.7
129.3
0.0
0.0
290.0
EBITDA
27.0
29.6
0.0
(2.4)
54.2
(3.3)
(4.1)
0.0
0.0
(7.4)
(4.1)
(3.6)
0.0
(0.3)
(8.0)
0.0
0.0
0.0
0.0
0.0
EBIT
19.6
21.9
0.0
(2.7)
38.8
(0.4)
0.0
0.0
0.0
(0.4)
1.9
0.0
0.0
0.0
1.9
21.1
21.9
0.0
(2.7)
40.3
0.0
0.7
(6.9)
0.0
(6.2)
IBG
SBG
JC-S
Other
Total
196.4
162.4
0.0
0.0
358.8
Operating profit
(in € million)
Total segment sales
Intra-segment sales
(34.0)
(37.4)
0.0
0.0
(71.4)
162.4
125.0
0.0
0,0
287.4
EBITDA
26.9
27.4
0.0
(2.8)
51.5
(2.6)
(3.3)
0.0
0.0
(5.9)
(5.0)
(4.4)
0.0
(0.2)
(9.6)
0.0
(0.3)
0.0
0.0
(0.3)
EBIT
19.3
19.4
0.0
(3.0)
35.7
(0.3)
(0.2)
0.0
0.0
(0.5)
0.0
2.0
0.0
0.0
2.0
19.0
21.2
0.0
(3.0)
37.2
0.0
0.6
(4.8)
0.0
(4.2)
Operating profit
19
2
Balance sheet by division
AS AT 06/30/2011
(in € million)
Total segment assets
IBG
SBG
JC-S
Other
Total
302.9
257.6
45.9
304.5
910.9
Total of non-allocated assets
60.7
TOTAL ASSETS
Total segment liabilities
971.6
(76.2)
(68.6)
0.0
(52.1)
(196.9)
Total non-allocated liabilities
(438.4)
TOTAL LIABILITIES
(EXCLUDING SHAREHOLDER’S EQUITY)
(635.3)
AS AT 12/31/2010
(in € million)
IBG
SBG
JC-S
Other
Total
274.7
262.4
37.1
287.7
861.9
121.4
TOTAL ASSETS
983.3
(90.1)
(65.4)
0.0
(44.2)
(199.7)
(442.4)
TOTAL LIABILITIES
(642.1)
AS AT 12/31/2009
(in € million)
IBG
SBG
JC-S
Other
Total
235,0
256.1
18.2
211.7
721.0
176.9
TOTAL ASSETS
897.9
(85.0)
(58.9)
0.0
(37.4)
(181.3)
(409.8)
TOTAL LIABILITIES
(591.1)
Investments by division
SIX-MONTH PERIOD ENDED JUNE 30, 2011
(in € million)
Acquisitions of property, plant and equipment
Capitalisation of development costs
TOTAL
IBG
SBG
JC-S
Other
Total
35.5
3.7
0.0
0.7
39.9
2.0
1.2
0.0
0.0
3.2
37.5
4.9
0.0
0.7
43.1
IBG
SBG
JC-S
Other
Total
61.6
8.0
0.0
0.8
70.4
FINANCIAL YEAR 2010
(in € million)
TOTAL
20
4.6
1.3
0.0
0.0
5.9
66.2
9.3
0.0
0.8
76.3
2
FINANCIAL YEAR 2009
IBG
SBG
JC-S
Other
Total
10.2
6.4
0.0
1.0
17.6
2.3
1.6
0.0
0.0
3.9
12.5
8.0
0.0
1.0
21.5
(in € million)
TOTAL
B)
INFORMATION BY GEOGRAPHICAL SEGMENT
CONSOLIDATED SALES BY GEOGRAPHICAL SEGMENT
Consolidated sales, allocated on the basis of the geographical location of customers, are as follows at June 30, 2011:
(in € million)
Europe
Period ended
June 30, 2011
Period ended
June 30, 2010
Period ended
June 30, 2009
160.3
140.1
148.1
North America
94.7
93.6
88.1
Asia/Oceania
39.1
33.3
33.0
Middle East and Africa
15.2
20.7
16.9
2.3
2.3
1.2
South America
Other
0.0
0.0
0.1
311.6
290.0
287.4
As of
June 30,
2011
As of
December 31,
2010
As of
December 31,
2009
Europe
675.1
684.8
649.6
North America
230.3
235.3
199.3
Asia/Oceania
28.8
25.9
23.1
37.4
37.3
25.9
South America
0.0
0.0
0.0
Other
0.0
0.0
0.0
971.6
983.3
897.9
TOTAL
ASSETS BY GEOGRAPHICAL SEGMENT
The Group’s assets, allocated on the basis of their geographical location, are as follows at June 30, 2011:
(in € million)
TOTAL
ACQUISITIONS OF PROPERTY, PLANT AND EQUIPMENT, INTANGIBLE ASSETS
AND CAPITALISATION OF DEVELOPMENT COSTS
Acquisitions of property, plant and equipment, intangible assets and capitalisation of development costs, allocated according to the
geographical location of the assets, are as follows:
Period ended
June 30, 2011
Period ended
June 30, 2010
Period ended
June 30, 2009
9.7
9.1
6.8
North America
32.3
16.9
1.8
Asia/Oceania
0.2
0.1
0.1
(in € million)
Europe
TOTAL
0.9
1.2
1.2
43.1
27.3
9.9
21
2
NOTE 5
SHAREHOLDERS’ EQUITY
The consolidated statement of changes in shareholders’ equity is
presented at the beginning of these statements as a summary table.
SHARE CAPITAL
As of June 30, 2011, Saft Groupe SA’s share capital was made up
of 25,174,845 ordinary shares with a par value of €1. A capital
increase was carried out during H1 2011 following the exercise of
stock options, a transaction that led to the creation of 49,005 new
shares.
NOTE 6
At the Annual Shareholders’ Meeting of Saft Groupe SA on May 3,
2011, the shareholders set the dividend for the 2010 financial year
at €0.70 per ordinary share.
The total amount of the cash dividend paid to shareholders on
May 27, 2011 thus amounted to €17.6 million compared with a
dividend payout of €7.4 million in 2010, year in which an option
for payment of the dividend in share was voted at the Annual
Shareholders Meeting. This option was exercised by shareholders
representing almost 56% of the capital.
PUBLIC SUBSIDIES
The Group is currently carrying out the construction of a new Li-ion
battery production facility in Jacksonville, Florida, in the USA.
This project, costing a total amount of approximately $200 million
over the period 2010-2013 (including both capital expenditure and
operating expenses relating to project management), has been
selected to receive, within the framework of the provisions of the
Federal American Recovery and Reinvestment Act (ARRA), a Federal
public grant awarded by the US Department of Energy in the form
of a cost-sharing programme for 50% that may amount to up to
$95.5 million. Receipt of this grant will be spread over time according
to the progress of the project. It covers capital expenditure and
some of the project management costs.
This project is also receiving additional funding from the State of
Florida and the City of Jacksonville for an amount of up to $20.8 million.
Furthermore, the Saft Group receives, primarily in France, tax credits
related to research. Such tax credits are being treated as grants from
an accounting standpoint.
22
DIVIDEND
income over the depreciation period of the assets that they are
used to fund. This income is recorded in cost of sales like the
depreciation expense for the related assets.
At June 30, 2011, the amount of the public grants received with
regard to the industrial project in Jacksonville totals €39.7 million
($50.6 million) compared with €24.5 million ($33.1 million) by the
end of 2010.
PUBLIC GRANTS RELATED TO RESULTS
Public grants related to results, i.e. grants other than those related
to assets, are recorded in income as a deduction from the expenses
to which they relate.
PUBLIC GRANTS RELATED TO ASSETS
Most of the grants from the State of Florida and the City of
Jacksonville are grants related to results. Spread over several financial
periods (of up to ten years), this aid will mainly lead to a reduction
in operating expenses for the Jacksonville production facilities in
future years. In consideration of these grants, the Company will
have to comply with a certain number of commitments primarily
related to job creation and a minimum level of average salaries.
Public grants received that relate to assets are presented under
balance sheet liabilities as deferred income on a specific line called
“Deferred grants related to assets”. These grants are recorded as
Public grants related to results recorded in H1 2011 in respect of
the Jacksonville project amounted to €3.2 million ($4.5 million)
compared with €1.1 million ($1.5 million) in H1 2010.
NOTE 7
2
NET FINANCE COSTS
The Group’s net finance costs for H1 2011 break down as follows:
Period ended
June 30, 2011
(in € million)
Financial income from cash and cash equivalents
Period ended
June 30, 2010
Period ended
June 30, 2009
0.7
0.3
0.4
Finance costs on gross debt
(6.6)
(7.8)
(4.6)
Other financial income and expenses:
(1.0)
1.0
(1.4)
•
Unwinding of discounts on provisions for pensions and other financial
liabilities
(1.2)
(1.0)
(1.3)
•
Foreign exchange gains/(losses)
(0.1)
2.6
(0.2)
•
Fair value measurement of financial instruments
TOTAL
The composite interest rate on bank debt (including the cost
of interest rate hedges) was 3.27% during the first half of 2011,
compared to a rate of 4.05% in H1 2010 and 2.99% in H1 2009.
By currency, the average rates break down as follows:
3.33% on euro debt in H1 2011, compared with 2.79% in
0.3
(0.6)
0.1
(6.9)
(6.5)
(5.6)
Other financial income and expenses is a net cost of €1.0 million in
the first half of 2011 against a net profit of €1.0 million in the first half
of 2010. A foreign exchange net loss of €0.1 million was recorded in
H1 2011 compared with a net profit of €2.6 million recorded during
the same period of previous year.
H1 2010 and 2.15% in H1 2009;
3.22% on US dollar debt in H1 2011, compared with an average
rate of 65.09% in H1 2010 and 3.51% in H1 2009.
NOTE 8
RELATED-PARTY TRANSACTIONS AND INVESTMENTS
IN JOINT UNDERTAKINGS
RELATED-PARTY TRANSACTIONS
The sales generated by the Group with the Johnson Controls-Saft joint venture, of which it holds a 49% stake in capital, were as follows during
the first half of the last three financial years:
Period ended
June 30, 2011
Period ended
June 30, 2010
Period ended
June 30, 2009
3.9
4.4
3.7
Sales (in € million)
INVESTMENTS IN JOINT UNDERTAKINGS
The Group’s share of the half-year income of ASB and Johnson Controls-Saft is as follows:
Period ended June 30, 2011 Period ended June 30, 2010
(in € million)
Sales
Cost of sales
JC-S
ASB
JC-S
ASB
Period ended June 30, 2009
JC-S
ASB
9.0
7.5
9.3
6.8
5.5
6.3
(13.3)
(5.2)
(10.7)
(4.6)
(6.3)
(4.1)
R&D costs (Engineering)
(3.9)
0.0
(2.1)
0.0
(1.2)
0.0
Other operating expenses
(4.1)
(1.3)
(3.5)
(1.3)
(2.6)
(1.3)
Operating income (loss)
(12.3)
1.0
(7.0)
0.9
(4.7)
0.9
NET INCOME (LOSS) FOR THE YEAR (a)
(12.4)
0.8
(6.9)
0.7
(4.8)
0.6
(a) Johnson Controls-saft being a pass-through entity, its net income is included in Saft Amercia Inc. income tax calculation.
23
2
JOHNSON CONTROLS-SAFT
On May 18, 2011, Saft was notified that Johnson Controls (JCI) had
filed a petition with the Delaware Chancery Court for the dissolution
of the Johnson Controls-Saft Advanced Power Solutions LLC (JCS)
joint venture under the Dispute Resolution Provisions set forth in
the Johnson Controls-Saft LLC shareholders’ Agreement signed in
January 2006.
Johnson Controls advised that the dispute was based on a wish
to expand the scope of JCS beyond the limits set within the 2006
Agreement.
On June 3, 2011, Saft filed a motion with the Chancery Court in
Delaware to dismiss the petition for dissolution of the Johnson
Controls-Saft Advanced Power Solutions LLC (JCS) because of the
absence of a legitimate reason for dissolution.
The “Delaware Chancery Court” ruling on the admissibility or
rejection by of the petition for dissolution is not expected to occur
before the fourth quarter of 2011.
NOTE 9
A)
Pending this first court decision or amicable resolution of this
dispute, the joint venture will continue to honour its commitments,
particularly vis-à-vis its customers.
Saft has confidence in the strategy, the technological positioning,
the management and employees of JCS and sees a profitable future
for the venture as outlined in the current Business Plan. JCS has
become an important player in the automotive HEV/PHEV/EV
market and has won a number of significant production contracts
with major clients.
The net asset value of JCS within the balance sheet of Saft as of
end June 2011 is €45.9 million. It consists mainly of Saft share of
the of lithium-ion manufacturing units of Nersac (built in 2007)
and Holland, Michigan, under commissioning, and in capitalized
development projects for which no impairment was identified
following the review conducted as part of the interim accounts.
Accordingly, to date, no evidence suggests that the value of these
assets should be questioned. Accordingly, no provision was recorded
in the consolidated financial statements as at June 30, 2011 for Saft
Group investment in Johnson Controls-Saft joint venture.
TAXES
BREAKDOWN OF INCOME TAX EXPENSE
The income tax charge for H1 2011 breaks down as follows:
(in € million)
Current income tax revenue/(expense)
Deferred income tax revenue/(expense)
TOTAL INCOME TAX REVENUE/(EXPENSE)
The overall tax rate amounts to 23.7% for the first half of 2011 as
compared to a overall tax rates of 17.4% and 21.3% in H1 2010
and 2009 respectively. It should be mentioned that the income
tax expense for H1 2010 includes non-recurring tax income of
B)
Period ended
June 30, 2011
Period ended
June 30, 2010
Period ended
June 30, 2009
(6.1)
(3.3)
(3.0)
1.2
(1.5)
(2.8)
(4.9)
(4.8)
(5.8)
€1.0 million corresponding to the profit for the 2009 financial year
generated from the extension of the tax consolidation regime in
France to include Saft Groupe SA.
TAX PROOF
The tax on the Group’s profit before tax differs from the theoretical amount that would arise using the weighted average tax rate applicable to
profits of the consolidated companies due to the following factors:
Period ended
June 30, 2011
Period ended
June 30, 2010
Period ended
June 30, 2009
Profit before tax
20.7
27.6
27.4
Notional tax charge (based on the French tax rate)
(7.0)
(9.4)
(9.4)
(in € million)
Impact of differences in tax rates between France and other countries
2.6
3.1
1.1
Effect of change in tax rates
0.2
0.3
0.4
(1.1)
1.5
1.3
1.1
0.5
0.9
Permanent differences (including Research Tax Credit)
Use of prior year losses for which no deferred tax asset was recognised
Tax losses of the current period on which no deferred tax was recongnised
(0.7)
(0.8)
(0.1)
INCOME TAX EXPENSE RECOGNISED IN INCOME STATEMENT
(4.9)
(4.8)
(5.8)
23.7%
17.4%
21.3%
Effective tax rate
24
2
NOTE 10 EARNINGS PER SHARE
Earnings per share are calculated on the basis of the actual average number of Saft Groupe SA shares in issue during the half year, treasury
shares held on average over the same period being deducted.
Weighted average outstanding number of Saft Groupe SA ordinary shares
Less average number of treasury shares held
Number of shares used to compute basic earnings per share
Effect of potential dilutive ordinary shares
Number of shares used to compute diluted earnings per share
As of June 30,
2011
As of June 30,
2010
As of June 30,
2009
25,161,304
24,716,605
18,755,901
(50,556)
(57,200)
(52,323)
25,110,748
24,659,405
18,703,578
233,805
237,560
-
25,344,553
24,896,965
18,703,578
NOTE 11 POST-BALANCE SHEET EVENTS
No event that has occurred since the balance sheet date is likely to have a material impact on the Group’s financial position.
25
3
on the 2010 interim financial information
Period from January 1 to June 30, 2011
This is a free translation into English of the Statutory Auditors’ review report issued in French and is provided solely for the convenience of
English speaking readers. This report should be read in conjunction with, and construed in accordance with, French law and professional
auditing standards applicable in France.
To the Shareholders,
In compliance with the assignment entrusted to us by your Shareholders’ Meeting and in accordance with the requirements of article L.4511-2 III of the French Monetary and Financial Code (Code monétaire et financier), we hereby report to you on:
the review of the accompanying Condensed Interim Consolidated Financial Statements of Saft Groupe SA, for the six months period
ended June 30, 2011;
the verification of the information contained in the interim management report.
These Condensed Interim Consolidated Financial Statements are the responsibility of the Board of Directors. Our role is to express a conclusion
on these financial statements based on our review.
CONCLUSION ON THE FINANCIAL STATEMENTS
We conducted our review in accordance with professional standards applicable in France. A review of interim financial information consists of
making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A
review is substantially less in scope than an audit conducted in accordance with professional standards applicable in France and consequently
does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly,
we do not express an audit opinion.
Based on our review, nothing has come to our attention that causes us to believe that the accompanying Condensed Interim Consolidated
Financial Statements are not prepared, in all material respects, in accordance with IAS 34 – the standard of IFRSs as adopted by the European
Union applicable to interim financial information.
Without qualifying the conclusion expressed above, we draw your attention to the note 8 to the condensed consolidated half-year financial
statements related to the situation of the joint-venture Johnson Controls-Saft Advanced Power Solutions LLC (JC-S).
SPECIFIC VERIFICATION
We have also verified the information given in the interim management report on the Condensed Interim Consolidated Financial Statements
subject to our review.
We have no matters to report as to its fair presentation and consistency with the Condensed Interim Consolidated Financial Statements.
Neuilly-sur-Seine and Paris, July 25, 2011
The Statutory Auditors
26
PricewaterhouseCoopers Audit
Mazars
Françoise GARNIER-BEL
Julierre DECOUX
Certificate by the persons responsible
4
Certificate by the persons
responsible
for the interim report
We attest that, to the best of our knowledge, the Interim Condensed Consolidated Financial Statements are prepared in accordance with the
applicable accounting standards and give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group and that
the interim management report gives a fair view of the information referred to in article 222-6 of the réglement général of the Autorité des
marchés financiers.
John Searle
Bruno Dathis
Chairman of the Management Board
Member of the Management Board and Chief Financial Officer
27
12, rue Sadi Carnot
93170 Bagnolet France
Tel.: +33(0)1 49 93 19 18 – Fax: +33 (0) 1 49 93 19 55
www.saftbatteries.com

interim financial report

Transcription

Documents pareils

Primary lithium batteries LO 29 SHX

Saft Group recognized for the transparency of its financial information

Ghislain Lescuyer appointed Chairman of the Management

Saft selected for DOE funding for Li

Saft announces debt refinancing and the success of its first issue on

Siemens Desiro RUS

E-supervision brochure

Saft signs a global Memorandum of Understanding with VNIIEM

Saft CSX Transportation press release

Saft confirms location for lithium-ion battery factory in Jacksonville