Pallet-Management-Services - AFM

More documents

Recommendations

Info

| ANNUAL REPORT 2006 | IFCO SYSTEMS N.V. | Operations 52 Revenues grew by 12.3% to US $647.2 million, as a result of continuing gains in both of our business segments. Gross profi t decreased by 6.2% and gross profi t margin declined 3.4 percentage points to 16.8% in 2006 from 20.2% in 2005. The gross profi t margin decline is largely due to the operational effects of the investigation by U.S. Immigration and Customs Enforcement (ICE) at a number of Pallet-Management-Services facilities in mid-April 2006. This resulted in partial replacement of the US Pallet-Management-Services workforce, which has led to a temporarily lower production capacity as new personnel are being trained. Additionally, we have experienced less effi cient raw material handling and increased transportation costs incurred to deliver available fi nished goods to customers. See Notes – Litigation for further discussion of this event. RPC-Management-Services 2006 gross profi t margin slightly declined in Europe due to decreased pricing levels and temporarily in the US due to transition expenses related to the washing center consolidation which followed the acquisition of the CHEP USA RPC assets earlier in 2006. See segment information for RPC-Management-Services for further discussion of these events. Selling, general and administrative expenses (SG&A) increased by 14.5% to US $56.1 million, largely as a result of increases in nonrecurring legal costs associated with the ICE investigation. Higher sales and administration personnel costs in line with our business growth were offset by lower bad debt accruals and lower variable compensation accruals. Excluding the nonrecurring ICE related legal defense costs, SG&A expenses were comparable to 2005 levels and decreased as a percentage of revenue from 8.5% in 2005 to 7.6% in 2006. EBITDA decreased by 2.2% to US $96.3 million during 2006, and EBITDA margin declined to 14.9% in 2006 from 17.1% in 2005, primarily as a result of the reduced profi tability of the Pallet-Management-Services business segment as described above. EBIT fell by 11.6% to US $62.3 million. The larger decline in EBIT as compared to EBITDA was mainly caused by the accelerated depreciation of the CHEP USA RPC assets acquired during 2006, partially offset by the effect of the change in estimate of the residual value of the Company’s RPCs. See Notes to consolidated fi nancial statements for further description of this change in estimate. Net profi t decreased by 8.8% or US $3.6 million to US $37.3 million in 2006, principally because of the decrease in profi t from operating activities as a result of the items discussed above, a signifi cantly higher income tax provision related to the RPC pool adjustment in Q2 2006 in Europe (see segment information for RPC-Management-Services for further discussion of this item) and slightly higher interest expenses as a result of higher average capital lease obligation levels and the periodic usage of our working capital facility in 2006. These effects were partially offset by the net gain of the RPC pool adjustment in Q2 2006, a smaller non-cash foreign currency loss and lower losses from discontinued operations in 2006 compared to 2005. Excluding the effect of discontinued operations, basic profi t per ordinary share decreased by 27.2% to US $0.71 in 2006 from US $0.98 in 2005. Liquidity and Cash Flows In line with Company’s decrease in profi tability, operating cash fl ows before working capital consideration decreased by 9.2% to US $86.7 million in 2006. However, the cash fl ows attributable to changes in working capital created positive cash fl ows of US $5.6 million during 2006, whereas these accounts were relatively fl at during 2005. Accordingly, total operating cash fl ows from continuing operations decreased in 2006 by only 3.2% over 2005 to US $92.3 million. Our capital expenditures increased 20.7% to US $101.3 million, due to the acquisition of the CHEP USA RPC assets in Q1 2006. Excluding this acquisition, capital expenditures decreased by 7.1%, or US $5.9 million, to US $78.0 million in 2006 as compared to 2005. Cash funds decreased by US $33.6 million to US $27.3 million at December 31, 2006. The main reason for this reduction was the funding of the acquisition of the CHEP USA RPC assets through Company’s available cash resources. As a result of the above factors, net debt increased by US $57.2 million to US $150.2 million at the end of 2006 compared to the end of 2005. Currency adjusted net debt increased only by US $45.1 million. As of December 31, 2006, IFCO SYSTEMS’ shareholders’ equity amounted to US $233.9 million, or 33.5% of total assets, as compared to US $201.5 million, or 32.0% of total assets, as of December 31, 2005.
Profi t per Share The company’s number of ordinary shares outstanding increased from 45.8 million to 54.2 million, mainly due to the warrant exchange in Q1 2006, which resulted also in a reduction of the profit per share. Return on Capital Employed We measure the return on invested capital of our business segments based on Return on Capital Employed (ROCE). We calculate ROCE by dividing the last twelve months’ reported EBIT by the total average book value of the capital employed which would be required to fund the measured business unit during this measurement period. We only consider our continuing operations’ EBIT and average book value to calculate ROCE. ROCE from continuing operations decreased to 18.4% in 2006 after 27.2% in 2005, 20.4% in 2004, 14.4% in 2003, and 8.0% in 2002. ROCE was negatively affected by our lower EBIT level in 2006 and the signifi cant increase of our Capital Employed, primarily our RPC pool, in 2006. | FINANCIAL REPORTING | MANAGEMENT’S DISCUSSION AND ANALYSIS | 53
Page 1 and 2:
ANNUAL REPORT 2006 | FINANCIAL REPO
Page 3 and 4: | FINANCIAL REPORTING | CONSOLIDATE
Page 5 and 6: Revenues US $ in thousands 360,990
Page 7 and 8: Even though our 2006 overall result
Page 9 and 10: Corporate culture Our corporate cul
Page 11 and 12: IFCO Systems locations Europe (RPC)
Page 13: Our business Ë IFCO SYSTEMS is eng
Page 16 and 17: | ANNUAL REPORT 2006 | IFCO SYSTEMS
Page 27 and 28: Pallet-Management-Services IFCO SYS
Page 29 and 30: Pallet-Management-Services IFCO SYS
Page 31: PALLET-MANAGEMENT-SERVICES SOLUTION
Page 51 and 52: Financial reporting 49
Page 53: Group fi nancial highlights - fi sc
Page 57 and 58: Operational expenses and profi tabi
Page 59 and 60: personnel in this division. The red
Page 61 and 62: Summary information by continuing b
Page 63 and 64: Cash fl ows | FINANCIAL REPORTING |
Page 65 and 66: Risk management Our internal risk m
Page 67 and 68: Research and development We are eng
Page 69 and 70: AUDITORS’ REPORT Report on the co
Page 71 and 72: IFCO SYSTEMS N.V. AND SUBSIDIARIES
Page 73 and 74: | FINANCIAL REPORTING | CONSOLIDATE
Page 75 and 76: users to evaluate the signifi cance
Page 77 and 78: Key assumptions used in the annual
Page 79 and 80: Where the Company has transferred i
Page 81 and 82: laws) that have been enacted or sub
Page 83 and 84: 4. Property, plant and equipment Pr
Page 85 and 86: The Company’s allowance for doubt
Page 87 and 88: 7. Earnings per share The following
Page 89 and 90: Receivable factoring In 2006, a sub
Page 91 and 92: 9. Income taxes The major component
Page 93 and 94: The corporate loss carryforwards at
Page 95 and 96: US $0.8 million was recorded for es
Page 97 and 98: US $, except number of options Year
Page 99 and 100: | FINANCIAL REPORTING | NOTES TO CO
Page 101 and 102: The Company’s revenue by country,
Page 103 and 104: | CAUTIONARY NOTE | 101
Page 105 and 106:
Spain IFCO SYSTEMS España Srl. Cal
Page 107 and 108:
PERSONAL NOTICES Imprint Imprint Ed
Page 109 and 110:
IFCO SYSTEMS N.V. Separate Financia
Page 111 and 112:
Our business IFCO SYSTEMS is engage
Page 113 and 114:
We are a holding company with a num
Page 115 and 116:
Board of Managing Directors Accordi
Page 117 and 118:
The Supervisory Board aims for an a
Page 119 and 120:
Independence of the members of the
Page 121 and 122:
The Supervisory Board has establish
Page 123 and 124:
The Committee shall review manageme
Page 125 and 126:
Performance Evaluations >The Remune
Page 127 and 128:
It is expected that the remuneratio
Page 129 and 130:
The Company’s net indebtedness de
Page 131 and 132:
comply with such laws and regulatio
Page 133 and 134:
Auditors’ report Report on the co
Page 135 and 136:
IFCO SYSTEMS N.V. balance sheets EU
Page 137 and 138:
IFCO SYSTEMS N.V. statements of cha
Page 139 and 140:
Notes to separate financial stateme
Page 141 and 142:
evaluating the effect of this inter
Page 143 and 144:
The following three cash-generating
Page 145 and 146:
Derecognition Financial assets A fi
Page 147 and 148:
Deferred income tax Deferred income
Page 149 and 150:
Reconciliation of equity to consoli
Page 151 and 152:
Capital reserve The capital reserve
Page 153 and 154:
105.2% on October 15, 2007, 102.6%
Page 155 and 156:
Components of the Company’s net d
Page 157 and 158:
No loans from the Company or pensio
Page 159 and 160:
condition. During July 2006, one of
Page 161 and 162:
Year ended December 31, 2006 Year e
show all

Pallet-Management-Services - AFM

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?