FORM 20-F THOMSON multimedia - Technicolor

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notably a gain (0 35 million) related to the sale of a derivative instrument acquired in 2000 and for which the underlying contract was terminated during 2001. For additional information on other income and expense see Notes 3 and 6 to our consolidated financial statements. Amortization of goodwill Goodwill amortization was 0 49 million in 2001 compared with 0 8 million in 2000. This increase reflects mainly the acquisition of Technicolor, which resulted in amortization of goodwill in the amount of 0 30 million beginning March 17, 2001. Income tax Income tax expense of 0 139 million was recorded in 2001, compared with a gain of 0 1 million in 2000. The consolidation of the Technicolor businesses and the expiration of a tax indemnification agreement with Thomson S.A. contributed to an increase of 0 37 million in current income tax, which was 0 142 million in 2001. As a result of the termination of this agreement, no tax indemnification amount was received in 2001. Under the terms of this tax indemnification agreement, which is described in detail below in ‘‘— Results of Operations for 2000 and 1999 — Income Tax’’, Thomson S.A. paid us 0 82 million in respect of the 2000 fiscal year (including 0 31 million in respect of a tax gross-up payment provided for in this agreement). In addition, the amount of deferred income tax amounted to a gain of 0 3 million in 2001 compared to a gain of 0 106 million in 2000, which included 0 25 million due to timing differences and 0 81 million on valuation allowance reversals concerning deferred tax assets. In 2001, we incurred income tax expenses mainly in France, the United States, the United Kingdom, Brazil, Poland, Mexico, Netherlands and Singapore. Our effective tax rate, defined as the ratio of income tax expense to consolidated income before taxes, amortization of goodwill and equity investments, was 30.5% in 2001. For additional information see Note 7 to our consolidated financial statements. Net income Minority interests represented a net loss of 0 22 million in 2001 compared with a net loss of 0 18 million in 2000. As a result of the factors discussed above, particularly income taxation, we recorded net income of 0 286 million in 2001 compared with 0 394 million in 2000. Net income as a percentage of net sales reached 2.7%, compared with 4.3% in 2000. Before amortization of goodwill, earnings per share reached 0 1.22 in 2001, compared with 0 1.59 in 2000, or a decrease of 23%. Earnings per share takes into account an increase in the average number of shares, which increased to 274.2 million shares in 2001 from 252.0 million in 2000 (after taking into account the two-for-one stock split realized on June 16, 2000) as a result of the October 2000 capital increase and the issuance in March 2001 of redeemable bonds to Carlton reimbursable into newly issued shares reserved for Carlton which have been recorded under ‘‘other equity’’ in shareholder’s equity. Please see Notes 2 and 17 to our consolidated financial statements for more detailed information on these redeemable bonds. U.S. GAAP Under U.S. GAAP we recorded net income of 0 191 million compared to 0 136 million in 2000. The difference in net income under U.S. GAAP versus French GAAP in 2001 resulted mainly from restatements related to restructuring, certain advantages in connection with employee share 46
offerings, the accounting treatment of investment securities and financial instruments, revenue recognition, purchase price allocation and amortization of intangibles resulting from our acquisition of the Technicolor businesses, post-retirement transition obligations and minority interests. Please refer to Notes 29 and 30 of our consolidated financial statements for a further discussion on the principal differences between French and U.S. GAAP. Results of Operations for 2000 and 1999 These comments on 2000 and 1999 results present an analysis of net sales and operating income by divisions, followed by comments on our consolidated results. Changes in scope of consolidation THOMSON multimedia Czech s.r.o and THOMSON multimedia Hungary, previously stated at cost, have been consolidated since January 1, 2000 as their operations have become significant. A new company, THOMSON multimedia Sales France, was incorporated in order to become the sales agent for the French business and has been consolidated since January 1, 2000. Also, in September 2000, we acquired 100% of Singingfish.com. The consolidation of these new entities did not significantly impact our results of operations in 2000. ATLINKS has been consolidated since December 31, 1999. Thomson’s income statement was not impacted in 1999, but ATLINKS did have an impact on the income statement in 2000. In addition, Atlinks España S.A., the ATLINKS manufacturing plant located in Spain, was added to the ATLINKS joint venture in January 2000 and consolidated. Changes in scope of consolidation are analyzed in more detail in Note 2 to our consolidated financial statements. Analysis by division The professional equipment and infrastructure businesses, previously managed by the Consumer Products division, have been reclassified for 2000 and 1999 to the Digital Media Solutions division, for which we reported results for the first time in 2001. Digital Media Solutions Consolidated net sales for the professional equipment and infrastructure businesses, previously managed by the Consumer Products division and reclassified into the Digital Media Solutions division in 2001, totaled 0 148 million in 2000, compared with 0 184 million in 1999. The decrease in consolidated net sales between 1999 and 2000 was principally the result of the positive non-recurring impact on consolidated net sales in 1999 from a contract in Nigeria. The operating income of these businesses totaled 0 3 million in 2000, compared with 0 8 million in 1999. Displays and Components Total net sales for the Displays and Components division, including internal sales, amounted to 0 2,550 million in 2000, an increase of 21.7% compared with 0 2,095 million in 1999. Consolidated net sales for Displays and Components totaled 0 1,686 million in 2000, an increase of 31.8% compared with 0 1,279 million in 1999. At constant 1999 exchange rates, consolidated net sales in 2000 totaled 0 1,546 million, representing an increase of 20.8% compared with 1999. The foreign exchange impact is mainly linked to the rise of the U.S. dollar compared to the euro. The 20.8% increase of consolidated net sales at constant exchange rates reflected a 13% increase in sales volumes attributable to the strong growth of the optical component business and to the steady growth in the tube business, driven by strong demand for large and very large tubes, 47
Page 1 and 2: As filed with the Securities and Ex
Page 3 and 4: INTRODUCTION In this Annual Report
Page 5 and 6: PART I ITEM 1 — IDENTITY OF DIREC
Page 7 and 8: 1997 1998 1999 2000 2001 (1) 2001 1
Page 9 and 10: B — Exchange Rate Information Our
Page 11 and 12: we have limited operating history,
Page 13 and 14: projects that such shareholder may
Page 15 and 16: publishers, network operators and e
Page 17 and 18: division. Our relative decrease in
Page 19 and 20: we initiated at the end of 2001 our
Page 21 and 22: approval. Nextream combines busines
Page 23 and 24: ) Digital Optical Components We pro
Page 25 and 26: our presence with global retailers
Page 27 and 28: product. Through Nextream, we will
Page 29 and 30: ) Within personal media services, w
Page 31 and 32: We have obtained significant price
Page 33 and 34: Location Division Products Asia: Ba
Page 35 and 36: ITEM 5 — OPERATING AND FINANCIAL
Page 37 and 38: and 10% in 1999. The acquisition of
Page 39 and 40: Accordingly, under U.S. GAAP, the g
Page 41 and 42: effect of the events of September 1
Page 43 and 44: labor costs resulting from the impl
Page 45: Our operating income under U.S. GAA
Page 49 and 50: GROWL in the United States. These p
Page 51 and 52: Other income and expense Other inco
Page 53 and 54: In evaluating our cash flow perform
Page 55 and 56: Guarantees given by subsidiaries of
Page 57 and 58: ITEM 6 — DIRECTORS, SENIOR MANAGE
Page 59 and 60: Initially Other business Principal
Page 61 and 62: Charles Dehelly was appointed Chief
Page 63 and 64: The following table, sets forth the
Page 65 and 66: French subsidiaries will pay bonuse
Page 67 and 68: our shares and have a nominal value
Page 69 and 70: exclusive right to grant licenses t
Page 71 and 72: In connection with the investigatio
Page 73 and 74: consumers who acquired certain tele
Page 75 and 76: are also permitted to offer investo
Page 77 and 78: The tables below set forth, for the
Page 79 and 80: ITEM 10 — ADDITIONAL INFORMATION
Page 81 and 82: general meeting affecting these rig
Page 83 and 84: oth for a period of up to five year
Page 85 and 86: an ordinary general meeting, or by
Page 87 and 88: that Euroclear France provide us at
Page 89 and 90: The shareholders, at an extraordina
Page 91 and 92: This discussion is intended only as
Page 93 and 94: ) a tax-exempt organization, ) a li
Page 95 and 96: A simplified certificate must state
Page 97 and 98:
ITEM 11 — QUANTITATIVE AND QUALIT
Page 99 and 100:
Sensitivity To Exchange Rate Fluctu
Page 101 and 102:
December 31, 2000 December 31, 2001
Page 103 and 104:
ITEM 17 — FINANCIAL STATEMENTS No
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FORM 20-F THOMSON multimedia - Technicolor

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