2012 Integrated report - Sappi

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Notes to the group annual financial statements for the year ended September 2012 3. Segment information The group’s reportable segments are Sappi Fine Paper North America, Sappi Fine Paper Europe and Sappi Southern Africa. Reportable segments are components of an entity for which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assess performance. The group regards its primary measure of segment performance as operating profit (loss) excluding special items. Sappi reports and discloses segment information on the basis of information that is reviewed by the chief operating decision maker to make decisions when allocating resources and to assess performance of the group’s reportable segments. Information reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance is focused on geographical regions. The group accounts for inter-group sales and transfers as if the sales or transfers were to third parties, that is, at current market prices. All such sales and transfers are eliminated on consolidation. The group operates a trading network called Sappi Trading for the international marketing and distribution of dissolving wood pulp and market pulp throughout the world and, of the group’s other products in areas outside its core operating regions of North America, Europe and Southern Africa. The financial results and position associated with Sappi Trading are allocated to our reportable segments. US$ million North America Sappi Fine Paper Europe 2012 2011 2010 2012 2011 2010 Income statement External sales (1) 1,438 1,520 1,373 3,350 3,965 3,638 Operating profit (loss) excluding special items 94 129 124 133 68 76 Special items – losses (gains) (2) 7 (7) (56) (45) 139 4 Segment operating profit (loss) 87 136 180 178 (71) 72 EBITDA excluding special items (2) 173 203 201 329 300 310 Share of profit (loss) of associates and joint ventures – – – 1 – 1 Depreciation and amortisation 79 74 77 196 232 234 (Impairment reversals) impairments of assets and investments – (3) (2) 1 57 (10) Profit on disposal of associates and joint ventures – – – – – – Profit (loss) on disposal of non-current assets – 2 3 51 – 2 Fellings – – – – – – Plantation fair value adjustment – – – – – – Restructuring provisions (released) raised and closure costs – (2) – 5 89 17 Other non-cash items 10 17 10 10 9 1 Balance sheet Capital expenditures 92 58 42 96 111 100 Segment assets (2) 919 908 935 1,776 1,889 2,109 Property, plant and equipment 774 762 777 1,314 1,484 1,663 Reconciliation of operating profit (loss) excluding special items to segment operating profit (loss): Sappi Fine Paper North America Europe US$ million 2012 2011 2010 2012 2011 2010 Operating profit (loss) excluding special items 94 129 124 133 68 76 Special items – losses (gains) (2) 7 (7) (56) (45) 139 4 Segment operating profit (loss) 87 136 180 178 (71) 72 Reconciliation of EBITDA excluding special items and operating profit (loss) excluding special items to profit (loss) before taxation: 118 Sappi Fine Paper North America Europe US$ million 2012 2011 2010 2012 2011 2010 EBITDA excluding special items (2) 173 203 201 329 300 310 Depreciation and amortisation 79 74 77 196 232 234 Operating profit (loss) excluding special items 94 129 124 133 68 76 Special items – losses (gains) (2) 7 (7) (56) (45) 139 4 Segment operating profit (loss) 87 136 180 178 (71) 72 Net finance costs Profit (loss) before taxation (1) Sales of products are allocated to where the product is manufactured. (2) Refer to the glossary on page 183 for the definition of the term. (3) Primarily includes the group’s treasury operations and its self-insurance captive.
2012: Sales by products (US$ million) 2011: Sales by products (US$ million) 2010: Sales by products (US$ million) 230 82 291 69 284 61 685 796 604 451 540 462 453 432 4,014 494 552 4,544 460 488 4,213 • Coated paper • Uncoated paper • Speciality paper • Commodity paper • Dissolving wood pulp • Paper pulp • Other Sappi Southern Africa Unallocated and eliminations (3) Group 2012 2011 2010 2012 2011 2010 2012 2011 2010 1,559 1,801 1,561 – – – 6,347 7,286 6,572 178 199 134 (2) 8 5 403 404 339 25 136 22 (5) 50 28 (18) 318 (2) 153 63 112 3 (42) (23) 421 86 341 271 309 236 (1) 9 5 772 821 752 4 2 4 (3) 4 8 2 6 13 93 110 102 1 1 – 369 417 413 9 68 2 – 45 – 10 167 (10) – – – 11 – – 11 – – 1 (2) – – 1 – 52 1 5 73 82 71 – – – 73 82 71 (68) (65) (98) – – – (68) (65) (98) (7) 44 23 – 4 6 (2) 135 46 21 22 (37) 5 (2) 2 46 46 (24) 216 97 64 – 2 – 404 268 206 1,605 1,574 1,887 20 51 65 4,320 4,422 4,996 1,067 987 1,220 2 2 – 3,157 3,235 3,660 Sappi Southern Africa Unallocated and eliminations (3) Group 2012 2011 2010 2012 2011 2010 2012 2011 2010 178 199 134 (2) 8 5 403 404 339 25 136 22 (5) 50 28 (18) 318 (2) 153 63 112 3 (42) (23) 421 86 341 Sappi Southern Africa Unallocated and eliminations (3) Group 2012 2011 2010 2012 2011 2010 2012 2011 2010 271 309 236 (1) 9 5 772 821 752 93 110 102 1 1 – 369 417 413 178 199 134 (2) 8 5 403 404 339 25 136 22 (5) 50 28 (18) 318 (2) 153 63 112 3 (42) (23) 421 86 341 283 307 255 138 (221) 86 sappi Integrated Report 2012 119
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Sappi Group (Sappi Limited) INTEGRA
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About this report Introduction Our
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2012 was a year that positioned us
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global Sales by source 2012: US$6,3
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Non-financial highlights Specific p
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performance the region as a whole.
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The restructuring of our paper oper
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Group overview continued Q&A with R
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Focus on product development Produc
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4 electricity steam black liquor pu
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commitment Europe Our European empl
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iodiversity Sustainable fibre suppl
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Exciter value delivery was US$23.9
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market leaders > Print is particula
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Focus on innovation Knowledge, insi
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Pulp Share of sales paper pulp + di
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governance Deenadayalen (Len) Konar
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guidance Executive management Mark
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Review of operations Sappi Fine Pap
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streamlined The closure of the Bibe
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Focus on skills development Sappi c
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accelerate Capacity (’000) Divisi
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progress The year ahead The demand
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US$ million September 2012 Septembe
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Share statistics 2012 2011 2010 200
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Chief financial officer’s report
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positive Section 2 Financial perfor
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improvement Operating profit exclud
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cost reduction Taxation The tax exp
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service Sappi Fine Paper North Amer
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priority Section 4 Cash flow In the
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Defined benefit liabilities US$ mil
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Group debt profile We show the majo
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performance Section 6 Share price p
Page 71 and 72: Governance and compensation Corpora
Page 73 and 74: encourage Audit committee The audit
Page 75 and 76: Group IT steering committee The Gro
Page 77 and 78: During 2012 a board committee was e
Page 79 and 80: Governance element Principle Summar
Page 81 and 82: External assurance providers Report
Page 83 and 84: Principle Chapter 7 - Internal audi
Page 85 and 86: Stakeholder engagement report Sappi
Page 87 and 88: Compensation report The two large s
Page 89 and 90: strategic The primary components of
Page 91 and 92: Component Purpose Characteristics V
Page 93 and 94: competitive The policy on fatalitie
Page 95 and 96: empower Service contracts Mr Boëtt
Page 97 and 98: The dissolving wood pulp capacity c
Page 99: Focus on local communities Our busi
Page 102 and 103: Directors’ approval The directors
Page 104 and 105: Audit committee report for the year
Page 106 and 107: Directors’ report for the year en
Page 108 and 109: Group income statements for the yea
Page 110 and 111: Group statements of cash flows for
Page 112 and 113: Group income statements in Rands (c
Page 114 and 115: Group statements of cash flows in R
Page 116 and 117: Notes to the group annual financial
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Notes to the group annual financial
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Annexure A - Investments at Septemb
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Glossary market pulp - pulp produce
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Glossary net operating assets - tot
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Notice to shareholders “Resolved
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Notice to shareholders “Resolved
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Notice to shareholders Annexure to
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Notice to shareholders The MOI prov
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Shareholder’s diary Annual genera
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198
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Notes to proxy The form of proxy mu
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Inspired to co-create We operate wi
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2012 Integrated report - Sappi

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