Pallet-Management-Services - AFM

The corporate loss carryforwards attributable to German
operations, together with additional trade tax carryforwards
(approximately US $166.5 million available as of December
31, 2006), do not expire. The loss carryforwards attributable to
United States operations expire between 2021 and 2024. The
loss carryforwards attributable to other European countries’
operations expire as follows; approximately US $0.4 million
expire between 2007 and 2009, approximately US $6.9 million
expire between 2010 and 2015 and the remainder does not
expire. All loss carryforwards are available to offset future
taxable income in their respective tax jurisdiction; however, loss
carryforwards attributable to the United States are subject to
a limitation of use under Internal Revenue Code Section 382
and loss carryforwards attributable to Germany are subject
to a limitation under German Income Tax Code Section 10d.
The Company has developed certain tax planning strategies
to reduce the effects of loss carryforward limitations in future
years. All loss carryforwards still require final validation from
the respective local taxing authorities and may be adjusted upon
further review.
During 2005 and 2006, the Company capitalized certain
deferred tax assets in the United States and Germany, as the
Company’s operating results have increased the likelihood that
these deferred tax assets will be utilized over the next three
(2005: two) years. The Company has a capitalized deferred tax
asset based on the projected use of loss carry forwards over the
next three years in amount of US $9.8 million in Germany and
US $18.8 million in the United States. A positive taxable income
over the next three years and the increase of the projection
period from two up to three years is probable due to positive
operating results already achieved in 2006 in the United States
and Germany and due to the tax planning strategy in regard of
the depreciation volume for RPCs in Germany. No deferred tax
assets are capitalized for loss carry forwards in the total amount
of US $188 million, thereof approximately US $94 million in
Germany, approximately US $47 million in the United States, and
approximately US $45 million in the European countries.
Deferred taxes have not been recognized for temporary
differences of US $18 million relating to earnings from foreign
subsidiaries, either because these profits are not subject to
taxation or because they are to be reinvested for an indefinite
period. If deferred taxes were recognized for these temporary
differences, the liability would be based on the respective
withholding tax rates only, taking into account the German tax
rate of 5% on corporate dividends where applicable. The amount
of these unrecognized deferred tax liabilities could not be
derived with reasonable effort.
| FINANCIAL REPORTING | NOTES TO CONSOLIDATED FINANCIAL STATEMENTS |
10. Related parties
Shareholders
As of February 20, 2007, 88.9% of IFCO SYSTEMS ordinary
shares continue to be held by Island International Investment
Limited Partnership (Island LP) with Cortese N.V. (a Netherlands
Antilles company) as the Managing General Partner of Island
LP. Cortese N.V. is beneficially owned by the limited partnerships
which collectively make up the Apax Europe V Fund. The
ultimate controlling party of these limited partnerships is
considered to be Apax Europe V GP Co. Limited, the General
Partner of Apax Europe V GP L.P., the General Partner of
the limited partnerships. Apax Europe V GP Co. Limited is a
company registered in Guernsey. Executive Management of
IFCO SYSTEMS continues indirectly to own 8.4% of the share
capital of IFCO SYSTEMS.
Supervisory Board
Name Position
Dr. Bernd Malmström Chairman
Michael Phillips Vice Chairman I
Christoph Schoeller Vice Chairman II
Hervé Defforey
Ralf Gruss
Dr. Philipp Gusinde
Board of Managing Directors
Name Position
Karl Pohler Managing Director
Douwe Terpstra Managing Director
Our Board of Managing Directors received in 2006 a
compensation of US $2.0 million. However, Mr. Pohler is
only compensated as member of the Executive Management
Committee but not separately compensated for serving as
member of the Board of Managing Directors.
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