Financial Report and Registration Document 2010 - Groupe Seb

3 NOTES
CONSOLIDATED FINANCIAL STATEMENTS
TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 28
OFF-BALANCE SHEET COMMITMENTS
28.1. SPECIFIC COMMITMENTS
Specific commitments are discussed in the following notes:
Note 22: Pension and other post-employment benefit obligations;
Note 24: Borrowings;
Note 25: Fair value of financial instruments.
28.2. COMMITMENTS ARISING IN THE ORDINARY COURSE OF BUSINESS
COMMITMENTS RELATED TO OPERATING ACTIVITIES
(in € millions) 2010 2009 2008
Firm orders for property, plant and equipment 14.8 16.3 14.6
Guarantees and bonds given 2.9 2.7 4.9
Commitments under non-cancellable operating leases 115.1 89.4 67.7
Miscellaneous financial commitments 1.2 1.3 11.3
TOTAL COMMITMENTS GIVEN 134 109.7 98.5
Guarantees received from customers (credit insurance) 544.7 442.8 424.7
Miscellaneous financial commitments 1.2 1.3 8.9
TOTAL COMMITMENTS RECEIVED 545.9 444.1 433.6
It is not the Group’s policy to sell receivables to factoring companies
or banks.
The French companies in the Group are committed to funding Fondation
Groupe SEB over several years. At 31 December 2010, their remaining
commitment amounted to €0.6 million (€1.2 million in 2009).
NOTE 29
CONTINGENT ASSETS AND LIABILITIES
29.1. CONTINGENT ASSETS
Supplier dispute
A provision for contingencies was set aside following a dispute with a
Chinese supplier concerning a shipment (see Note 6.3). The Group’s
maximum exposure is estimated at €5 million, but the entire claim is being
contested and the related legal proceedings are expected to be lengthy.
Pentalpha dispute
In April 2006, a jury in New York returned a verdict in favour of Groupe
SEB in relation to a patent infringement suit fi led in 2000 against Hong
Kong companies Pentalpha Enterprises Ltd. and Global-Tech Appliances,
Inc. (hereinafter referred to as Pentalpha), concerning a deep fryer marketed
in the United States. This New York District Court ruling on 9 October 2008
found that Groupe SEB was entitled to a reasonable royalty payment of
$4.7 million. Pentalpha challenged this ruling by filing:
an appeal before the Court of Appeals for the Federal Circuit (CAFC)
in Washington, which fully upheld the District Court ruling on
5 February 2010;
a suit against the SEB patent with the US Patent and Trademark
Offi ce (USPTO). The suit was overruled as the USPTO upheld all the
claims of the SEB patent in December 2009.
Pentalpha then submitted a request for the CAFC to review its decision.
Pentalpha has also submitted a $1 million claim against SEB and its lawyer
before the New York State Court for inaccurate and misleading statements
made during the patent case.
The CAFC rejected Pentalpha’s request for a review of its conviction for
patent infringement and on 10 August 2010 Groupe SEB received the
€5.1 million in damages that had been held in escrow during the proceedings.
On 25 June 2010, however, Pentalpha asked the Supreme Court of the
United States to hear its appeal of the CAFC decision.
Groupe SEB has not recognised any amounts in the financial statements in
relation to this dispute pending the outcome of these various proceedings.
In the past twelve months, apart from what is refl ected in the fi nancial
statements and described in the accompanying notes, there have been
no other government, legal or arbitration proceedings (including any such
proceedings which are pending or threatened of which the Group is aware)
which may have or have had in the recent past signifi cant effects on the
Group and/or its financial position or profitability.
110 FINANCIAL REPORT AND REGISTRATION DOCUMENT 2010 GROUPE SEB