Annual Report 2008 - Securitas

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106 Annual report Notes and comments to the consolidated financial statements MOvEMENTS IN PrOvISION FOr PENSIONS AND SIMILAr cOMMITMENTS, NET 2008 2007 2006 MSEK Obligations Plan assets Net Obligations Plan assets Net Obligations Plan assets Net Opening balance 3,490.0 –2,561.8 928.2 3,547.4 –2,498.5 1,048.9 3,763.2 –2,572.1 1,191.1 current service cost 97.3 – 97.3 115.5 – 115.5 116.7 – 116.7 Interest cost 201.5 – 201.5 176.4 – 176.4 169.6 – 169.6 Expected return on assets – –188.3 –188.3 – –168.2 –168.2 – –162.0 –162.0 Recognized actuarial gain/loss 1 0.4 – 0.4 –2.1 – –2.1 –2.1 – –2.1 Recognized past service cost 0.2 – 0.2 – – – –0.9 – –0.9 Settlements/curtailments/terminations –0.7 – –0.7 –32.4 6.2 –26.2 –27.3 – –27.3 Total pension cost recognized in the statement of income 298.7 –188.3 110.4 257.4 –162.0 95.4 256.0 –162.0 94.0 Actuarial gains and losses – obligations 2, 3 274.0 – 274.0 –88.9 – –88.9 63.4 – 63.4 Actuarial gains and losses – plan assets 2 – 440.8 440.8 – 30.1 30.1 – –51.0 –51.0 Total actuarial gains and losses before tax 2 274.0 440.8 714.8 –88.9 30.1 –58.8 63.4 –51.0 12.4 Employer contributions 4 – –167.9 –167.9 – –167.8 –167.8 – –133.4 –133.4 Employee contributions 2.0 –2.0 – 9.4 –9.4 – 11.0 –11.0 – Benefits paid to participants –161.3 161.3 – –172.6 172.6 – –154.7 154.7 – Acquisitions/divestitures 2.4 – 2.4 19.1 – 19.1 – – – Discontinued operations –1,622.3 1,178.2 –444.1 – – – –101.9 71.6 –30.3 Translation difference 245.3 –147.4 97.9 –81.8 73.2 –8.6 –289.6 204.7 –84.9 Closing balance 2,528.8 –1,287.1 1,241.7 3,490.0 –2,561.8 928.2 3,547.4 –2,498.5 1,048.9 Discontinued operations relate to the obligations and plan assets that as of December 8, 2008 were included in Loomis and as of September 29, 2006 were included in Securitas Direct and Systems. 1 Relates to other long-term employee benefits. 2 Relates to post-employment benefits. FUNDED STATUS, NET MSEK 2008 2007 2006 Fair value of plan assets –1,287.1 –2,561.8 –2,498.5 Defined benefit obligation funded plans 1,897.1 2,886.3 2,941.1 Defined benefit obligation unfunded plans 631.7 603.7 606.3 Funded status, net 1,241.7 928.2 1,048.9 The table above presents the funded status for funded defined benefit plans as well as the obligations for unfunded defined benefit plans which together form the funded status, net. ALLOcATION OF PLAN ASSETS Percent 2008 2007 2006 Equity investments 42 55 56 Interest bearing assets 48 39 37 Other assets 10 6 7 Total allocation of plan assets 100 100 100 The table above presents a breakdown of the various types of investments in which the assets of the Group’s funded benefit arrangements are invested. Further information on the principles for determining the return on assets can be found in Note 2. Securitas Annual report 2008 3 Actuarial losses for 2008 relate to changes in assumptions (losses) of MSEK 125.7 (gains of –131.5 and gains of –7.2) and changes in plan experience (losses) of MSEK 148.3 (losses of 42.6 and losses of 70.6). 4 Employer contributions expected to be paid in 2009 are expected to increase compared to the employer contributions paid in 2008 for continuing operations, due to the increased deficit in the Group’s funded pension plans. PrOvISIONS FOr PENSIONS AND SIMILAr cOMMITMENTS, NET MSEK 2008 2007 2006 Plans reported under Other long-term receivables (Note 23) –8.4 –17.9 –7.0 Plans reported under Provisions for pensions and similar commitments 1,250.1 946.1 1,055.9 Total provisions for pensions and similar commitments, net 1,241.7 928.2 1,048.9 The table above shows the distribution in the balance sheet after taking into consideration plan assets and obligations for defined benefit plans. Plans with net assets are reported under Other long-term receivables and plans with a net provision are reported under Provisions for pensions and similar commitments. AccUMULATED AcTUArIAL LOSSES MSEK (net of tax) 2008 2007 2006 relating to 2008 –360.3 – – relating to 2007 10.7 10.7 – relating to 2006 –2.7 –2.7 –2.7 relating to 2005 –160.2 –160.2 –160.2 relating to 2004 –70.5 –70.5 –70.5 Total accumulated actuarial losses 1 –583.0 –222.7 –233.4 1 Refers to actuarial losses from continuing operations recognized via the statement of recognized income and expense, net after tax.
MAIN AcTUArIAL ASSUMPTIONS 2008 2007 2006 Percent (per annum) USA Eurozone Other countries USA Eurozone Other countries USA Eurozone Other countries Discount rate 1 6.20 5.50–5.75 3.80–7.00 6.00 5.50–5.75 4.70–5.70 5.75–6.00 4.50–4.75 4.50–5.25 Expected return on plan assets 8.50 5.00 5.70–7.00 8.50 5.25 5.70–6.80 8.50 4.80 5.00–6.75 General salary increases 2 n/a 2.00–3.50 3.75–4.00 n/a 2.00–3.50 3.50–4.80 n/a 2.00–3.50 2.50–4.50 Inflation 2 n/a 1.75–2.25 2.00–3.00 n/a 1.75–2.00 2.50–3.30 n/a 1.75–2.00 2.50–3.00 Pension increases 2 n/a 0.75–1.75 1.50–3.75 n/a 1.00–1.75 2.00–4.25 n/a 1.75 2.25–3.00 Health care cost inflation 3 n/a n/a 2.00–10.00 n/a n/a 2.50–8.00 n/a n/a n/a 1 In the USA, the discount rate is derived from the full Citigroup yield curve, using a cash flow matching approach. In the Eurozone, the discount rate is based on Iboxx Euro AA 10 year +, adjusted for the duration of the obligations. The material plans in the category Other countries are Norway (government bonds adjusted for the duration of the obligations), the U.K. (Iboxx U.K. AA 15 year +) and canada (DEX capital index). The table above shows the main actuarial assumptions as of December 31, 2008, 2007 and 2006 used to value the defined benefit obligation at the end of 2008, 2007 and 2006 as well as in determining the pension cost for 2009, 2008 and 2007. Note 33. Other long-term provisions The movement in the balance sheet for provisions for pensions and similar commitments is provided in Note 32. The movement in the balance sheet for deferred tax liabilities is provided in Note 15. MSEK Liability insurance related claims reserves 1 Provisions for taxes Other provisions Total Opening balance 724.3 251.5 1,317.1 2,292.9 Reclassification – –18.0 10.7 –7.3 New/increased provisions 42.2 9.2 262.6 314.0 Provisions utilized –27.3 –113.8 –691.6 –832.7 Reversal of unutilized provisions –56.0 – –44.5 –100.5 Discontinued operations –196.3 – –213.8 –410.1 Translation differences 116.4 47.5 88.1 252.0 Less short-term items – – –156.3 –156.3 Closing balance 603.3 176.4 572.3 1,352.0 1 Liability insurance-related claims reserves primarily consist of estimated provisions for the portion of claims payable by the Group, that is its self-retention. 2 Plans in the USA are non-inflation-linked cash balance plans which are closed for future benefit accrual. 3 related to health care plans in canada. The assumption represents the range of current expected health care cost inflation for the different benefits. This range is expected to fall to 2.00–5.00 percent (depending on benefit type) by 2020. Note 34. Short-term loan liabilities 1 MSEK 2008 2007 2006 convertible debenture loans EUr, 2002/2007, series 1–4 2 – – 2,300.0 Total short-term convertible debenture loans – – 2,300.0 EMTN Nom MEUr 500, 2001/2008, 6.125 % 3 – 4,717.1 – commercial paper issued 4 1,974.6 2,023.4 1,468.1 Finance leases 102.9 114.6 141.4 Other short-term loans 5 4,197.0 1,720.8 4,001.8 Total other short-term loan liabilities excluding derivatives 6,274.5 8,575.9 5,611.3 Other derivative positions Derivatives with negative fair value, short-term 134.2 39.0 83.5 Total other short-term loan liabilities 6,408.7 8,614.9 5,694.8 1 For further information regarding financial instruments refer to Note 6. 2 The convertible debenture loan, EUr 2002–2007 series 1–4 fell due on May 2, 2007. 3 The bond loan EMTN Nom MEUr 500, 2001/2008 matured on March 14, 2008 and was in 2007 reported under Other short-term loan liabilities. Previously, this loan has been reported under Other long-term loan liabilities. 4 commercial paper is issued by the Parent company within the framework of a MSEK 5,000 Swedish commercial paper program. 5 Other short-term loans include loans raised within the framework of a MUSD 1,100 Multi currency revolving credit Facility maturing in June 2012. The comparatives also include loans raised within the framework of a MUSD 250 securitization programme, which matured in June 2008. The MEUR 550 term loan has in its entirety been classified as long-term compared to previously being classified as short-term. comparatives for year 2007 have been restated. Note 35. Other current liabilities Annual report Notes and comments to the consolidated financial statements As of December 31, 2008 the following assumptions were used for the major plans in Securitas concerning mortality: USA – “193 Group Annuity Mortality Table”. Norway – tables in series “K2005”. canada – UP94-tables. These tables have been established for use after consultation with the company’s actuaries and reflect Securitas’ view concerning future mortality experience. MSEK 2008 2007 2006 Employee-related items 5,701.2 5,462.3 4,709.4 Accrued interest and financial expenses 174.9 354.7 279.0 Other accrued expenses and deferred income 799.0 795.7 515.8 Advance payments from customers 196.4 215.9 177.3 value added tax 938.3 947.2 691.5 Other items 558.0 669.6 590.2 Total other current liabilities 8,367.8 8,445.4 6,963.2 Securitas Annual report 2008 107
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Annual Report 2008
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Securitas in short Sales by busines
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” Business relationships are loca
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during the second half of the year.
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The cornerstones of our strategy Hi
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The Business model for Specialized
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Industry/Manufacturing - Case #1 pa
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Our Security officer Andy Price per
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Estuardo Turcios, one of Securitas
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Euclides Vieira, a mobile services
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Our security officer Marc Jessen he
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Security Services North America pro
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Events and key figures for 2008 ·
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Leading the Specialization in Europ
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Events and key figures for 2008 Acq
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Events and key figures for 2008 Acq
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Growing in New Markets A cornerston
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services. Asia is the third-largest
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Securitas’ monitoring services ar
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work with independent and strong lo
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Volume-related factors The first tw
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Business Risk Evaluation Model Secu
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A Securitas risk management case to
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an environmental impact from a life
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Turnover The turnover of Securitas
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DATA PER SHARE SEK/share 2008 2007
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Taxes, net income and earnings per
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Acquisitions have increased acquisi
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GRB Security, United Kingdom Securi
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Page 65 and 66: Securitas’ financial model - cons
Page 71 and 72: Note 1 General corporate informatio
Page 73 and 74: IFRS 8 Operating segments The Group
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Page 79 and 80: Employee benefits (IAS 19) The Grou
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Page 91 and 92: Shareholdings The Board of Director
Page 93 and 94: JANUAry - DEcEMBEr 2007 MSEK Income
Page 95 and 96: AUDIT FEES AND rEIMBUrSEMENTS MSEK
Page 97 and 98: DEFERRED TAx ASSETS WERE ATTRIBUTAB
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Page 103 and 104: Impairment testing For the purpose
Page 105 and 106: Note 20. Tangible non-current asset
Page 107 and 108: Note 29. Changes in shareholders’
Page 109: Note 32. Provisions for pensions an
Page 113 and 114: Globe and other Securitas companies
Page 115 and 116: Annual report Parent Company financ
Page 117 and 118: Balance sheet MSEK Note 2008 2007 2
Page 119 and 120: Note 40. Accounting principles The
Page 121 and 122: Note 44. Personnel AvErAGE NUMBEr O
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Page 127 and 128: Significant Shareholders The princi
Page 129 and 130: The Work of the Board of Directors
Page 131 and 132: Insider Policy and Records The Boar
Page 133 and 134: 3. Financial Reporting controllers
Page 135 and 136: E. Management Assurance - Function
Page 137 and 138: Sofia Schörling Högberg b. 1978 D
Page 139 and 140: Bart Adam Bart Adam b. 1965 Divisio
Page 141 and 142: MSEK 2004 2005 2006 2007 2008 CAPIT
Page 143 and 144: Statement of income 2007 MSEK q1 20
Page 146: Securitas AB Box 12307 SE-102 28 St
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Annual Report 2008 - Securitas

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