Annual Report 2004 - HL Display

Note 15
TAX ON PROFIT FOR THE YEAR
Group Parent Company
SEK T
Details of tax expenses for the year
2004 2003 2004 2003
Current tax –21,226 –12,817 –11,350 –11,993
Deferred tax –2,503 11,920 –1,221 1,221
Tax on profit for the year –23,729 –897 –12,571 –10,772
Current tax on items reported in shareholders’ equity (Group contributions) — — 8 996 11,464
SEK T
Reconciliation of pre-tax profits and tax expenses
Pre-tax profits 68,409 –9,212 56,350 57,544
Tax according to Swedish tax rate, 28% –19,155 2,579 –15,778 –16,112
Adjusted for other tax rates outside Sweden –3,621 –988 –122 –529
Adjustment of last year’s current tax –10 558 — —
The tax effect of reviewing incoming deficit deductions due to changed evaluations, tax rates and exchange rates 950 –1,534 — —
Tax effects of deficits for which deferred tax assets have not been considered –197 –412 — —
Tax effects of non-deductable depreciations of goodwill –340 –612 — —
Tax effects of non-taxable share dividends — — 5,879 5,918
Tax effect of write-down of subsidiary’s shares — — –2,240 —
Tax effects of other non-taxable, non-deductable items –1,356 –488 –310 –49
Tax on profit for the year –23,729 –897 –12,571 –10,772
Group Parent Company
SEK T 2004 2003 2004 2003
Details of deferred tax assets and tax liabilities
Deductable deficiency 6,122 7,962 — 1,221
Internal inventory profit 5,253 6,629 — —
Other temporarily deductable differences 5,010 6,261 — —
Deferred tax assets 16,385 20,852 — 1,221
Untaxed machinery and inventory reserves –9,405 –10,172 — —
Untaxed reserves, tax allocation reserve –6,513 –7,725 — —
Other temporarily taxable differences –1,141 –1,126 — —
Deferred tax liability –17,059 –19,023 — —
Net deferred tax assets in the balance sheet 12,586 15,705 — 1,221
Net deferred tax liability in the balance sheet –13,260 –13,876 — —
In the consolidated statement, deferred tax assets of SEK 4,415 T (4,825) is reported based on deductible deficit in companies which have posted losses over the
last financial years. This regards recently set-up companies and companies where a growth in turnover in a market build-up phase is deliberately prioritised instead
of profitability.
In the consolidated statement, deferred tax assets have not been reported for deficits amounting to SEK 6,552 T (10,211). These non activated deficits and the
deficits which caused activated income tax recoverable may be utilized without time limits or legal restrictions.
Differences between the group and the parent company in the book value of subsidiaries and joint ventures totals SEK 72,308 T (83,627). Due to changes in tax
legislation, this value can now be realised without tax consequences, although this is only done through tax-free dividends.
Not 16
EARNINGS PER SHARE
HL Display AB (publ) has through a wholly-owned subsidiary, HL Financial Services
AB, on three occasions issued debentures with separable rights of option
(warrants), which were sold on to senior executives within the Group. The purpose
of offering warrants is to promote long-term commitment to the company
and to encourage senior executives to become future shareholders in the company.
The term of the warrants is around four years, which the Board wishes to
be acknowledged as an aim to gain warrant holders’ long-term commitment to
the company’s future.
The 2001 warrant scheme was implemented in December 2001 and comprised
49,200 warrants. If all options are converted, the number of shares
will increase by 49,200, corresponding to 0.7 per cent of share capital. The
subscription price is set at SEK 134, the subscription period is 01-03-2004
- 28-02-2006 and the warrants expire on 28-02-2006.
The 2002 warrant scheme was implemented in March 2002 and comprised
48,700 warrants. If all options are converted, the number of shares will
increase by 48,700, corresponding to 0.6 per cent of share capital. The subscription
price is set at SEK 175, the subscription period is 01-07-2004 - 30-06-
2006 and the warrants expire on 30-06-2006
The 2003 warrant scheme was implemented in March 2003 and comprised
49,200 warrants. If all options are converted, the number of shares will
41
increase by 49,200, corresponding to 0.6 per cent of share capital. The
subscription price has been set at SEK 86, the subscription period is 01-06-
2005–29-06-2007, and the options to subscribe become due on 29-06-2007.
No warrants were converted or became due during 2004.
The profit per share before and after dilution has been calculated as follows:
Group Parent Company
2004 2003 2004 2003
Earnings per share, 45,315 –10,109 43,779 46,772
SEK T 7,688,872 7,688,872 7,688,872 7,688,872
Earnings per share 45,315 –10,109 43,779 46,772
after dilution, SEK T 7,707,139 7,688,872 7,707,139 7,688,872
The outstanding warrant scheme has no future effect on the profit. In calculating
the number of shares after dilution, we have applied an average share price
for the period of SEK 116 (89) and a discount interest rate of 7 (7) per cent.
Dilution only arises if certain conditions are fulfilled. Dilution does not occur if,
for example, the present value of the subscription price is less than the average
share price during the period, or in case of a negative result
NOTES
HL DISPLAY ANNUAL REPORT 2004