ASSA ABLOY Annual Report 2002

Group development

Income statement

2002
EUR M¹⁾ 2002
SEK M 2001
SEK M 2000
SEK M
Sales 2,779 25,397 22,510 14,394
Cost of goods sold -1,699 -15,526 -13,863 -8,568
Gross income 1,080 9,871 8,647 5,827
Sales and administrative expenses -687 -6,276 -5,488 -3,719
Operating income before goodwill amortization 393 3,595 3,159 2,107
Goodwill amortization -105 -957 -860 -387
Non-recurring items - - -166 -
Operating income 289 2,638 2,133 1,720
Financial items -69 -631 -664 -331
Share in earnings of associated companies 1 8 7 12
Income before tax 220 2,015 1,476 1,402
Tax -75 -689 -507 -453
Minority interests -6 -56 -20 -34
Net income 139 1,270 949 915

Operating cash flow

2002
EUR M¹⁾ 2002
SEK M 2001
SEK M 2000
SEK M
Operating income before goodwill amortization 393 3,595 3,159 2,107
Depreciation 104 950 861 598
Net capital expenditure -92 -839 -830 -497
Change in working capital 44 405 -77 -94
Paid and received interest -64 -581 -817 -357
Adjustment for non-cash items -1 -5 43 -2
Operating cash flow 386 3,525 2,338 1,756

Capital employed and financing

2002
EUR M²⁾ 2002
SEK M 2001
SEK M 2000
SEK M
Capital employed 2,915 26,701 27,861 19,779
- of which goodwill 1,770 16,213 16,371 12,078
Net debt 1,527 13,989 15,534 8,560
Minority interests 36 331 481 560
Shareholders‘ equity 1,352 12,381 11,846 10,659

The ASSA ABLOY product portfolio

Sales by organizational unit³⁾

2002 2001 2000
Scandinavia SEK M 1,970 1,914 1,889
Finland EUR M 126 126 125
Central Europe⁵⁾ EUR M 175 155 121
South Europe⁶⁾ EUR M 407 314 263
United Kingdom GBP M 86 86 48
North America USD M 1,078 937 589
South Pacific AUD M 216 158 145
New Markets⁷⁾ SEK M 1,952 2,029 981
Hospitality NOK M 816 920 1,005
Identification USD M 132 106 -
Door Automatics SEK M 1,015 - -
Total SEK M 25,397 22,510 14,394

Sales by country ⁴⁾

2002
EUR M¹⁾ 2002
SEK M 2001
SEK M 2000
SEK M
USA 1,135 10,376 9,935 5,418
France 225 2,061 1,904 1,647
United Kingdom 175 1,602 1,545 763
Germany 118 1,079 963 780
Mexico 109 993 445 152
Sweden 107 981 855 839
Australia 94 863 775 724
Spain 87 797 341 178
Canada 80 733 661 373
Finland 73 663 662 606
Norway 66 600 538 500
The Netherlands 53 487 304 167
Denmark 46 418 424 365
Asia (excl. China) 43 396 450 248
Italy 42 381 344 214
The Middle East 33 299 282 201
Belgium 30 273 248 171
China 29 268 286 125
Czech Republic 25 228 200 165
South Africa 22 198 150 40
South America 21 194 185 94
New Zealand 21 190 66 39
Central America (excl. Mexico) 20 180 141 46
Switzerland 19 178 137 57
Russia 13 116 54 28
Portugal 11 96 49 40
The Baltic countries 7 66 59 43
Poland 7 64 65 55
Romania 5 46 50 48
Other countries 62 571 392 268
Total 2,779 25,397 22,510 14,394

¹⁾ EUR/SEK average rate 9.14
²⁾ EUR/SEK rate at 31 December 9.16
³⁾ Including exports from each unit
⁴⁾ Sales to customers in each country
⁵⁾ Germany, Netherlands, Switzerland & Austria
⁶⁾ France, Belgium, Italy & Spain
⁷⁾ Africa, Asia, Israel, South America & eastern Europe

Key data **

2002 2001 2000** 1999** 1998
Sales, SEK M 25,397 22,510 14,394 10,277 8,582
Organic growth, % 2 3 5 5 6
Gross margin (EBITDA), % 17.9 17.9 18.8 18.1 18.5
Operating margin before goodwill amortization (EBITA), % 14.2 14.0 14.6 13.5 12.8
Operating margin (EBIT), % 10.4 10.2* 12.0 11.6 11.2
Income before tax, SEK M 2,015 1,642* 1,402 981 748
Profit margin (EBT), % 7.9 7.3 * 9.7 9.5 8.7
Operating cash flow, SEK M 3,525 2,338 1,756 1,218 1,028
Operating cash flow / Income before tax 1.75 1.42* 1.25 1.24 1.37
Net capital expenditure, SEK M 839 830 497 391 316
Depreciation and amortization, SEK M 1,907 1,721 985 667 623
Total assets, SEK M 33,261 34,669 26,029 11,241 9,219
Shareholders' equity, SEK M 12,381 11,846 10,659 5,269 2,715
Net debt, SEK M 13,989 15,534 8,560 2,998 4,237
Capital employed, SEK M 26,701 27,861 19,779 8,534 6,984
Capital employed excluding goodwill, SEK M 10,487 11,490 7,701 5,288 4,460
Equity ratio, % 38.2 35.6 43.1 49.2 29.8
Interest coverage ratio, times 3.9 3.5* 5.5 5.3 4.4
Net debt / equity ratio, times 1.13 1.31 0.8 0.57 1.56
Return on shareholders' equity, % 9.9 8.9* 13.3 16.2 19.0
Return on capital employed before goodwill amortization, % 33.3 32.9* 34.2 28.7 26.4
Return on capital employed, % 9.9 9.7* 13.7 15.6 15.2
Operational return on capital employed, % 13.4 13.3* 16.7 17.9 17.4
Earnings per share after tax and full conversion, SEK 3.53 2.98* 2.73 2.00 *** 1.76***
Earnings per share after tax and full conversion excluding goodwill, SEK 6.13 5.39* 3.88 2.61 2.21
Interest on convertible debenture loan after tax, SEK M 27.2 9.0 8.5 8.7 11.7
Cash earnings per share after tax and full conversion, SEK 9.08 8.07* 5.81 4.10 *** 3.75***
Shareholders' equity per share after full conversion, SEK 35.85 35.80 30.58 16.95 *** 9.93***
Number of shares, thousands 365,918 353,751 352,453 314,409 284,304
Number of shares after full conversion, thousands 370,935 361,730 356,712 324,200 295,448
Average number of employees 28,754 24,211 16,881 12,654 10,545

* Key data for 2001 excludes non-recurring items
** Key data for 1999 and 2000 has been adjusted for changes in accounting principles
*** Has been adjusted for new share issues with an adjustment factor 0.987

Definitions

Organic growth: Change in sales for comparable units after adjustments for acquisitions and currency rate effects.
Gross margin: Operating income before depreciation and amortization as a percentage of sales.
Operating margin before goodwill amortization: Operating income before goodwill amortization as a percentage of sales.
Operating margin: Operating income as a percentage of sales.
Profit margin: Income before tax as a percentage of sales.
Operating cash flow: See consolidated cash flow statement.
Net capital expenditure: Investments in tangible fixed assets less disposals of tangible fixed assets.
Depreciation: Depreciation/amortization of intangible and tangible fixed assets.
Net debt: Interest-bearing liabilities less interest-bearing investments.
Capital employed: Total assets less interest-bearing assets and non-interest-bearing liabilities including deferred tax liability.
Capital employed excluding goodwill: Total assets less interest-bearing assets and non-interest-bearing liabilities including deferred tax liability and goodwill.
Equity ratio: Shareholders‘ equity including minority interests as a percentage of total assets.
Interest coverage ratio: Income before tax plus net interest divided by net interest.
Return on shareholders‘ equity: Net income plus interest expenses after tax for convertible debenture loans as a percentage of average shareholders‘ equity after full conversion.
Return on capital employed before goodwill amortization: Income before tax plus net interest and goodwill amortization as a percentage of average capital employed excluding goodwill.
Return on capital employed: Income before tax plus net interest as a percentage of average capital employed.
Operational return on capital employed: Income before tax plus net interest and goodwill amortization as a percentage of average capital employed.
Earnings per share after tax and full conversion: Net income plus interest expenses after tax for convertible debenture loans per weighted average number of shares after full conversion.
Earnings per share after tax and full conversion excluding goodwill: Net income excluding goodwill amortization plus interest expenses after tax for convertible debenture loans per weighted average number of shares after full conversion.
Cash earnings per share after tax and full conversion: Net income plus interest expenses after tax for convertible debenture loans, plus depreciation and amortization, plus profit share from minority interest less profit share from associated companies and adjustments for changes in deferred tax per weighted average number of shares after full conversion.
Shareholders‘ equity per share after full conversion: Shareholders‘ equity plus convertible debenture loans per share after full conversion.