2009 - Jaarverslag

REPORT OF THE EXECUTIVE BOARDOPERATING INCOME BEFORE AMORTISATIONOperating income before amortisation (EBITA) declined by 57%to € 41.5 million.In the Advanced Textiles & Composites sector (– 48%), the biggest fallwas recorded in the results of the TenCate Advanced Armour NA andProtective Fabrics Europe groups.In the Geosynthetics & Grass sector (– 55%), the decreases in salesat TenCate Geosynthetics North America and TenCate Grass ledto a substantial reduction in EBITA.The EBITA of the other activities amounted to – € 7.0 million and wasattributable to the holding company, which derives its incomeprincipally from interest on loans. This interest is not visible at EBITAlevel. Xennia Technology and TenCate Enbi contributed positively tothe result.RAW MATERIAL COSTSAs a percentage of revenues, raw material costs, including the changein inventories, decreased from 53% to 50%. This favourabledevelopment was caused by:◾ a large reduction in inventories, particularly of finished products;◾ a steep fall in polyethylene and polypropylene prices.As 2009 progressed and the markets came under further pressure,an ever larger part of the purchasing advantage had to be passedon to customers.PERSONNEL COSTSPersonnel costs as a percentage of sales increased from 18% to 20%.It was not possible to respond rapidly enough to the sharp decreasein revenues by cutting personnel costs. This lack of flexibility appliesparticularly in the Netherlands and a number of other Europeancountries.Labour flexibility is much greater in the United States and Asia.The number of employees, including temporary personnel, decreasedas follows:Year-end 2009 2008Netherlands and rest of Europe 1,468 1,621 – 9%United States 1,413 1,700 – 17%Middle East and Asia 1,061 1,327 – 20%3,942 4,648 – 15%TAXESThe tax rate increased slightly from 27.3% to 28.0%. A large part ofthe profit is generated in the United States, where there is a high rate:34% + state tax (5-8%). On the other hand, the tax charge decreasedbecause it was possible to use losses available for set-off in variouscountries.PE price development in €/kg1.81.61.41.21.00.80.6PP price development in $/lb0.90.80.70.60.50.40.30.4JAN FEB MA APR MAY JUN JUL AUG SEP OCT NOV DEC0.2JAN FEB MA APR MAY JUN JUL AUG SEP OCT NOV DEC28Royal Ten Cate◾ 2009 ◾ 2008