Annual report 2011 - Trelleborg

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CONSOLIDATED INCOME STATEMENTS
Profit before tax totaled sek 2,426 m (2,068). The Group’s tax rate
was 29 percent (29). Net profit amounted to sek 1,727 m (1,474).
Earnings per share were sek 6.30 (5.35).
Items affecting comparability of sek 204 m were charged to operating
profit, with the following breakdown:
sek m 2011 2010
Cost of goods sold –102 –30
Administrative expenses –32 –43
Other operating costs –70 –177
Continuing operations –204 –250
Action programs in the business areas
Work on the action programs announced earlier continued during
the year. Of the total cost of these programs, sek 204 m (250) was
charged to the Group’s operating profit and negative sek 149 m (neg:
190) to the Group’s net profit.
At the Trelleborg Engineered Systems business area, the project
aimed at concentrating the number of production units in Sweden, the
UK and Estonia was concluded during the year. The project announced
in 2010 focusing on production in Forsheda and Skellefteå, Sweden,
and the partial relocation of production to a number of plants outside
Sweden, continued during the year. The project will be completed
in 2012. The process of focusing and optimizing the structure of
Trelleborg Marine Systems continued. The project is expected to be
completed in its entirety during the first half of 2012. In Trelleborg
Offshore, a project was initiated to improve the production structure
primarily in the UK and US, while also optimizing the organization.
The project is scheduled to be completed in early 2013. In total,
operating profit was charged with sek 86 m (110) for these measures
in the business area.
At the Trelleborg Automotive business area, efforts to consolidate
parts of the operation in Germany were essentially concluded in
2011. In addition, the project linked to the focusing and relocation
of production in Forsheda and Skellefteå also impacted Trelleborg
Automotive. Operating profit in the business area was charged with
a total of sek 93 m (98) for the action program.
Trelleborg Sealing Solutions was also involved in the restructuring
in Forsheda and Skellefteå. In total, operating profit for the year
in the Trelleborg Sealing Solutions business area was charged with
sek 24 m (22).
Costs for action programs
sek m 2011 2010
Continuing operations
Trelleborg Engineered Systems 86 110
Trelleborg Automotive 93 98
Trelleborg Sealing Solutions 24 22
Trelleborg Wheel Systems 0 16
Other 1 4
Total before tax 204 250
Total after tax 149 190
Annual Report 2011 Trelleborg AB
Discontinued operations
Roofing operation
The divestment of the roofing operations, formerly part of the
Trelleborg Engineered Systems business area, was concluded on
January 31, 2011.
Competition investigations into subsidiaries
Trelleborg’s subsidiaries in France and the US, have in recent years,
been the subject of investigations conducted by the competition
authorities in the US, the EU, Brazil and Australia, among others,
regarding certain types of marine oil hoses and marine fenders.
The decision announced by the European Commission in 2009
was appealed by Trelleborg in the same year. Trelleborg continues
to await the European Court of Justice’s decision. Future developments
with respect to this issue continue to be associated with an
element of uncertainty related to the length and outcome of ongoing
processes.
Events after the closing date
Trelleborg strengthens and focuses the Group
The Trelleborg Group will be strengthened and focused through
organizational changes.
Trelleborg Automotive will be focused on antivibration solutions.
Trelleborg Automotive’s other operations – polymer boots for drive
shafts and steering applications and noise-damping solutions for
brake systems – will be strengthened by integrating them into
Trelleborg Engineered Systems and Trelleborg Sealing Solutions,
respectively.
Trelleborg Engineered Systems will be focused on three prioritized
areas: offshore and infrastructure construction, general industrial
applications and polymer-coated fabrics for advanced industrial
applications. As a consequence, three people will assume new
positions in Trelleborg’s Group Management: Denis Blanc, Mikael
Fryklund and Dario Porta. Trelleborg’s President and CEO Peter Nilsson
will assume responsibility for Trelleborg Engineered Systems.
Lennart Johansson, Trelleborg Engineered Systems’ current
President, and current President of Trelleborg Automotive, Jim Law,
have been appointed as the Trelleborg Group’s representatives on
the management board of the joint venture in antivibration solutions
for light and heavy vehicles that is planned between Trelleborg
and Freudenberg. Trelleborg’s President and CEO Peter Nilsson will
become the company’s Chairman.
Divestment of the light-vehicle component operation
On January 24, 2012, Trelleborg signed an agreement to divest an
operation that manufactures high-technology rubber, plastic and foam
components and systems for the light vehicles industry. The operation
is primarily located in France and is part of the Trelleborg Automotive
business area. The buyer is Bavaria Industriekapital AG with
its registered office in Munich, Germany. The divestment is a further
step in the Trelleborg Group’s strategy to focus on selected segments.
The capital gain will have a minor impact on earnings 2012.
Market outlook for the first quarter of 2012.
Demand is expected to be in line with or slightly higher than the
fourth quarter of 2011, adjusted for seasonal variations.
GRI: SO7, SO8