Annual report 2001 - GL events

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3 3-5-3 Risk linked to the activity Concerning the selection of investments and the operating methods to build-up projects, Générale Location’s internal policy is to control and master the risks taken both towards the staff concerned and the public who will come and visit the sites. As a result, special attention is given to the preparation of projects and the anticipation of possible problems. Concerning certain activities (mostly grandstands and structures) committees of control are systematically solicited. Générale Location‘s commitment is to respond to clients‘ needs by providing services which, together or taken individually, correspond to norms established by each professional activity and which must be used according to given rules. It is up to the clients to make sure these rules are respected during the event. Générale Location guarantees its responsibility by subscribing to a policy of Group’s public liability. Concerning human resources, three characteristics particular to Générale Location and its activity can be brought forwards. a) The multiplicity of the different activities exercised by the Group, the markets, and the geographical sites from where Générale Location operates as well as the strong service policy the group offers to its clients, have led Générale Location to maintain a method of organization based on profit centers kept at a human size with an emphasis on the individual professional evolution and the proximity in the relation to its clients. b) The activity of Générale Location characterizes itself by the daily presence of an important portion of its staff on the numerous sites where shows, events, and exhibitions occur every day. c) Autonomy and a sense of the responsibilities are two values crucial in the management of human resources. It is in fact thanks to both of them that Générale Location is able today to expand its development. This risk must be taken into account and placed within a context where the seasonal aspect of the activity for one is important and also where the more distant locations of certain projects are more frequent. Based on this, this particular risk is considered weak. 3-5-4 Markets risk This risk is also judged weak. The market of shows and events relies on the need to convene in order to exchange and share (knowledge, leisure, points of view,…). We consider that the new tools of communication such as internet and mobile phones reinforce the need for meeting rather than decreasing it. As a result of some of social upheavals, conflicts, and epidemics (mouth-and-foot disease), some events have been prevented from happening. Générale Location bases its activities and its assets in countries considered by the group politically and economically stable. The possibility to transfer the assets in another country and the globalization of our clients are two factors which reduce the risk in case of encountered difficulties. 3-5-5 Legal and tax risk During the regular process of its activities, the Group is at time implicated in legal disputes and litigations. Whereas the final outcome of these procedures cannot be known in advance, the Group can estimate that the obligations which could result from them should not have a significant impact on its financial situation and its consolidated results. 3-5-6 Foreign currency exchange risk Each of the foreign subsidiary holds rental equipment dedicated to a specific market (video walls, furniture, grandstands,…). Générale Location can transfer this equipment from one entity to another without taking the risk of seeing its intrinsic value go down as a result of exchange rate fluctuation. Concerning the activity, except for major international projects, where exchange rate risk may occur, there is no regular flow of business with the foreign entities which could possibly put Générale Location’s structure at risk. The charges engaged by foreign subsidiaries are mostly local charges paid in the same currency as the one used for invoicing. Consequently, one will consider the risk linked to exchange rate moderate.
42 43 3-5-7 Interest rate risk, credit and actions The management of the risks related to cash flow and exchange rate, follows strict rules defined by the Group’s Executive Management. These rules call for the systematic centralization exercised by the Financial Direction of all cash flow, positions and management of the financial instruments. Interest Rate Risk at 31 December 2001 Total K€ Balance sheet Financial assets - Financial liabilities - Medium term loans on fixed rate made variable on a 3 month rolling rate Telerate 20052 5 942 - Medium term loans (indexed on a 3 month Euribor) 32 973 - Medium term loans (indexed on T4M / EONIA 975 - Overdrafts 8 266 Off balance-sheet – Discounted notes not yet matured 1 194 Net risk 49 350 Cover (1) 21 186 Remaining variable rate debt 28 163 Most of the indebtedness is index-linked on threemonth rates. Occasionally, covers can be subscribed to for all or a portion of the financial debts. Considering the volume of the debt, the market anticipations and amounts already cashed in, the risk is considered weak. (1) Out of the 21 186 K€, 15 245 K€ come from a rate guarantee operation COLLAR covering the period between the 22nd of May 2002 to the 22nd of May 2003. The amount remaining of 5 942 K€ corresponds to the fact that a 7 622 K€ loan contracted at fixed rate in May 2000 was made variable (indexed over 3 months). The other medium-term loans of 11 055 K€ are at fixed rate. Moreover, the Group holds some interest in various listed companies (see note 28 of the notes of the consolidated statements) whose market value fluctuates with the stock market, the valorization of the respective sectors of activities these companies evolve in and the financial and economic situations of each of these companies. The amount of this share interest being low, the risk as a result is not significant. 3-5-8 Risks linked to the industry and the environment Générale Location handles its operations in strict the company has not identify any significant risk linked compliance with the regulation in force. Its activities to the environment. deal mostly with the provision of services, and as a result 3-5-9 Insurance – Cover for possible risks Principal insurance risks and the amount of insured capital • Public liability : All damages together : 15m€ per claim and per year of insurance Back-up public liability : all damages, 15m€ per claim and per year in excess of 15m€ acquired under the first excess policy. • Fleet of vehicles : 410 vehicles, 75 trucks, and 100 trailers • Fire : Buildings : 40m€ Rental equipment : 81m€ Furniture, fittings, and merchandise : 21m€ Other material damages : 8.3m€ Liability : 7.6m€ Investments : 7m€ Expenses and losses : 3.8m€ 3-6 Litigations and exceptional facts To the best of the company’s knowledge, there are to this day no litigation or exceptional facts which could have or have had an impact on the group’s financial situations, its activity, its results and its assets in general. 3-7 Objectives and prospects The objective of Générale Location is to pursue the development of its activities on its four markets (shows exhibitions, events, fitting museum fittings, venue management) and at the same time to increase its profitability. In order to do so, Générale Location favors the following strategies : 3-7-1 Events market – International Générale Location will pursue its development in the following two directions : events market and the international. This development provides it with additional activities which are immediately profitable. It also provides it with more balanced commercial positions. Moreover, due to the economic globalization, this strategy gives the company the possibility to carve a niche for itself and the ability to fulfil today’s clients ‘expectations and respond to their future requests.
Page 2 and 3: Table of contents 1 Générale Loca
Page 4 and 5: Lyon Tennis Grand Prix “ a satisf
Page 6 and 7: Première Vision First class Vinexp
Page 8 and 9: “Royal Ascot” Salt Lake City
Page 10 and 11: Army Museum Silk museum City of Sci
Page 12 and 13: ® Pierre-Louis DOUERE Architect :
Page 14 and 15: Evolution of net sales : + 9.8 % Er
Page 16 and 17: “ satisfying clients is our sole
Page 18 and 19: “ satisfying clients for the bene
Page 20 and 21: Picture by : MCO-SPORTS “ a devel
Page 22 and 23: Board of Directors Chairman - Chief
Page 24 and 25: 1 1. Person responsible for the ref
Page 26 and 27: 2 General Information regarding Gé
Page 28 and 29: 2 General Information regarding Gé
Page 30 and 31: 2 Evolution of the capital of Gén
Page 32 and 33: 2 Thresholds crossing Due to the pr
Page 34 and 35: 2 2-5 Financial communication Press
Page 36 and 37: 3 1989 Alliance between the Group P
Page 38 and 39: 3 3-3-4 Venue management This marke
Page 40 and 41: 3 3-4-1-1 Role played by Générale
Page 42 and 43: 3 Other services The Group offers o
Page 46 and 47: 3 3-7-2 Venue management The distin
Page 48 and 49: 4 Evolution by market In 2001, the
Page 50 and 51: 4 b - Operating profit Expressed as
Page 52 and 53: 4 ● PACKAGE ORGANISATION PACKAGE
Page 54 and 55: 4 ● DECORAMA DECORAMA (M€) 2001
Page 56 and 57: 4 c - Future Prospects Générale L
Page 58 and 59: 4 4-1-2 Five year financial summary
Page 61 and 62: 58 59 4-2 Consolidated Financial St
Page 63 and 64: 60 61 4-2-2 Consolidated Balance Sh
Page 65 and 66: 62 63 4-2-4 Notes to the consolidat
Page 67 and 68: 64 65 2-2-2 Consolidation scope The
Page 69 and 70: 66 67 Tangible fixed assets Tangibl
Page 71 and 72: 68 69 Net sales For shows, fairs, a
Page 73 and 74: 70 71 Note 4 Other Intangible Asset
Page 75 and 76: 72 73 Note 8 Rental Equipment Gross
Page 77 and 78: 74 75 Breakdown of the corporate Ta
Page 79 and 80: 76 77 The Mixed Annual General Meet
Page 81 and 82: 78 79 Note 18 Loans and Debts The d
Page 83 and 84: 80 81 The breakdown of charges for
Page 85 and 86: 82 83 The analysis of the Exception
Page 87 and 88: 84 85 Note 28 Other Risks Foreign C
Page 89 and 90: 86 87 Scope of consolidation Compan
Page 91 and 92: 88 89 4-6 Draft of proposed resolut
Page 93 and 94: 90 91 will have to resign at the en
Page 95 and 96:
5 Organs of administration, directi
Page 97 and 98:
94 95 5-1-3 Board of Directors and
Page 99 and 100:
96 97 5-3 Personnel profit sharing
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Annual report 2001 - GL events

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