Complete Annual Report - Uralita

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BUSINESS PERFORMANCE IN 2005 Market growth In Western and Central Europe, growth was fairly uneven in the different markets. Among the growth markets, Spain, France and the UK are worth a particular mention. Among the markets where growth was negative, we would highlight Poland and Germany (consumption of insulation materials was closely related to the negative general performance of the construction sector in the latter country). In Eastern Europe and Russia the performance was boosted by the increase in construction activity and the penetration of insulation materials. Main initiatives of the <strong>Uralita</strong> Group Given the situation of the market, Ursa revised its Strategic Plan in 2005 Given the situation of the market, whose performance did not match the business plan’s forecasts, Ursa revised its Strategic Plan in 2005. In August the Group implemented an ambitious restructuring plan whose strategic objectives were, firstly, to focus activity on the core construction business, secondly, to tailor existing production capacity to demand, especially in Western Europe, and, thirdly, to implement an ambitious plan to cut costs and reduce the complexity of the business, thereby increasing its profitability. The initiatives carried out were as follows: • Closure of the Wesel glass wool plant in Germany. • A significant cutback in industrial insulation activities. • Withdrawal from sale of third-party products. 33
• Closure of the pipe insulation line in Novo Mesto (Slovenia), concentration of production at the Salgotarjan plant (Hungary) and concentration of sales in more profitable markets. • Rationalisation of the product portfolio • Personnel downsizing at all levels and structural cost cuts. • Drafting of a plan to reduce the number of operating units (to be implemented in 2006). Finally, the decision was made to relocate the headquarters from Frankfurt to Madrid to consolidate the culture of the Group and increase synergies with the Group’s corporate centre and other businesses. 2005 Results The Insulation Business reported sales of €440 million in 2005, up 1.1% on 2004, thanks to the growth of Eastern European markets, which offset the decline in activity in Germany. EBITDA in the Insulation Business came to €55.4 million, 25.3% down on 2004. The EBITDA margin fell from 17.1% in 2004 to 12.6% in 2005. This setback in profitability was due primarily to the situation of construction markets in Central Europe, mainly Germany, and secondly to the increase in the cost of energy and oil-derived raw materials, with the temporary difficulty of passing on the entire increase in these costs to the market at present. 34
Page 1 and 2: Annual Report 2005 CORPORATE SPIRIT
Page 3 and 4: Uralita Group Mejía Lequerica, 10
Page 5 and 6: Letter from the Chairman Dear Share
Page 8 and 9: Uralita Group Overview of the Urali
Page 10 and 11: From left to right: Mr. Javier Eche
Page 12 and 13: Overview of the Uralita Group Urali
Page 14 and 15: In the late 1980s and the 1990s, Ur
Page 16: Main markets The Group embarked on
Page 19 and 20: The Uralita Group in 2005 ECONOMIC
Page 21 and 22: Macroeconomic indicators and constr
Page 23 and 24: Now that all the divestments are co
Page 25 and 26: As a consequence, the organisationa
Page 27 and 28: Respect for and continuous developm
Page 29 and 30: STRATEGIC PRIORITIES FOR 2006 Incre
Page 32 and 33: Uralita Group Management Report by
Page 34 and 35: Annual Report 2005 Uralita Group In
Page 38 and 39: Financial highlights Million euros
Page 40 and 41: Annual Report 2005 Uralita Group Gy
Page 42 and 43: Unlike the plasterboard market, the
Page 44 and 45: 2005 Results In 2005 the Gypsum Bus
Page 46 and 47: Annual Report 2005 Uralita Group Ro
Page 48 and 49: BUSINESS PERFORMANCE IN 2005 Market
Page 50 and 51: Financial highlights Million euros
Page 52 and 53: Annual Report 2005 Uralita Group Pi
Page 54 and 55: BUSINESS PERFORMANCE IN 2005 Market
Page 56: MILESTONES FOR 2006 The main object
Page 59 and 60: The Uralita Group on the Stock Mark
Page 61 and 62: Annual highs, lows and closing pric
Page 64 and 65: Uralita Group Corporate Governance
Page 66 and 67: A. SHARE CAPITAL STRUCTURE A.1. Sha
Page 68 and 69: A.8. Own shares. During the year 20
Page 70 and 71: Resignations from the Board of Dire
Page 72 and 73: B.1.6. Directors who are also execu
Page 74 and 75: B.1.9. Remuneration of Senior Manag
Page 76 and 77: Both the aforementioned Committee a
Page 78 and 79: Number of meetings of the different
Page 80 and 81: B.1.31. Stakes held by members of t
Page 82 and 83: Nomination and Remuneration Committ
Page 84 and 85: C. RELATED PARTY TRANSACTIONS C.1.
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• To obtain the Risk Portfolio so
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In particular, the following measur
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E.12. Address and access to the cor
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The delegation of exclusive powers
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Recommendation 14. AGE OF DIRECTORS
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Uralita’s Board of Directors seek
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In application of the policies of t
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Corporate Social Responsibility 1.
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3. Responsibility for the Environme
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Uralita’s commitment to its share
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5.3. Training 5.3.1. Human Resource
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5.3.4. URSA invests in Human Resour
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) 477 employees from the Group Corp
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6.2. Third-party training The Urali
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Uralita Group Annual Financial Stat
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Translation of consolidated financi
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Translation of consolidated financi
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and Social Measures. Note 4 sets ou
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Equity at 31 December 2004 Attribut
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d. Changes in consolidation scope I
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4. Main accounting principles The m
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Where the carrying amount exceeds t
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• Trade and other payables Trade
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Provisions for guarantees Provision
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4.19. Consolidated cash flow statem
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• The business plans prepared are
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The movement in this heading in the
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The sale of cash-generating units r
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At 31 December 2005, the parent com
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Thousands of euros 2005 2004 Uralit
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The private bond placement was held
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16. Guarantees As of 31 December 20
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Other operating expenses The detail
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• Pipes • Chemicals The busines
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Revenues Profit (loss) before taxes
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In 2004, as profit estimates by the
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2004 Board of Nomination Audit TOTA
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APPENDIX 1 - Subsidiaries - 2005 By
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Results at the Gypsum Business show
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Mejía Lequerica, 10 28004 Madrid (
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Complete Annual Report - Uralita

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