Annual Report 2006 ISS Global A/S

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1 January – 31 December. Amounts in DKK millions 25. Long-term debt 2006 2005 Euro Medium Term Notes 1) Notes due 2010 6,546 Notes due 2014 Senior facilities 3,851 2) Term facility A 1,480 Term facility B 4,973 Acquisition facilities 2,508 Mortgage loans 2 Other bank loans 27 Obligations under finance leases 194 Long-term debt - affiliates 368 Total long-term debt 3) Fair value of long-term debt 4) Long-term debt is payable as follows: 19,949 18,867 1-5 years 9,088 After 5 years 10,861 Total 19,949 Effective interest rate 5) ISS Global's total long-term debt is denominated in the following currencies: 6,645 3,909 1,892 2,400 1,304 7 55 146 - 16,358 14,739 6,848 9,510 16,358 5.5% 4.8% DKK 2.7% 8.3% EUR 78.6% 70.2% GBP 9.7% 9.3% NOK 4.2% 5.8% SEK 3.2% 4.6% USD related 0.0% 0.0% Others 1.6% 1.8% ISS Global had no subordinated debt and no debt convertible into equity. Finance lease obligations are payable as follows: Within 1 year 101 1-5 years 148 After 5 years 6) 89 1) Minimum lease payments Interest Principal 338 2006 2005 (13) (23) (20) (56) 88 125 69 282 100.0% 100.0% Minimum lease payments Interest Principal ISS Global A/S listed a Euro Medium Term Note programme in September 2003 and subsequently launched its inaugural issue. The EUR 850 million notes have a maturity of seven years and an annual coupon of 4.75%. In December 2004, ISS Global A/S issued EUR 500 million of notes with a maturity of ten years and an annual coupon of 4.50%. At 31 December 2006, the weighted average interest rate was 4.66% (2005: 4.49%). See also Note 7, Net finance costs. 2) The senior facilities are subject to customary undertakings, covenants (including financial covenants) and other restrictions. At 31 December 2006 the term facility A and term facility B had a weighted average floating interest rate of 5.73% and 6.62% respectively (2005: 4.21% and 6.61%). The acquisition facilities had a weighted average floating interest rate of 5.97% (2005: 4.67%). 3) In 2006, financing fees amounting to DKK 72 million (2005: DKK 40 million) have been recognised in long-term debt. 4) The fair value of long-term debt is based on the quoted market price on the Luxembourg Stock Exchange of the Euro Medium Term Notes. For the remaining long-term debt fair value is equal to the nominal value. 5) Weighted average taking the effect of interest rate hedges into account. 6) Financial lease obligations after five years related to buildings. _____________________________________________________________________________________________________________ ANNUAL REPORT 2006 / Consolidated Financial Statements 82 110 92 84 286 (12) (12) (18) (42) 98 80 66 244
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1 January – 31 December. Amounts in DKK millions 26. Pensions and similar obligations ISS Global contributes to defined contribution plans as well as defined benefit plans. The majority of the pension plans are funded through payments of annual premiums to independent insurance companies responsible for the pension obligation towards the employees (defined contribution plans). In these plans ISS Global has no legal or constructive obligation to pay further contributions irrespective of the funding by these insurance companies. Pension costs related to such plans are recorded as expenses when incurred. In some countries, most significantly, the Netherlands, Sweden, Switzerland, France, Germany, Norway and the United Kingdom, ISS Global has pension schemes where the actuarially determined pension obligations are recorded in the consolidated balance sheet (defined benefit plans). The defined benefit plans are primarily based on years of service and benefits are generally determined on the basis of salary and rank. The majority of the obligations are funded, but in some countries, mainly Sweden and France, the obligation is unfunded. In certain countries, ISS Global participates in multi-employer pension schemes. The funds are currently not able to provide the necessary information in order for ISS Global to account for the schemes as defined benefit plans. In the Netherlands two curtailment gains have been recognised in the income statement under staff costs. These are a consequence of a reduction in the future benefits of the participants in the defined benefit plan and have resulted in a curtailment gain of DKK 98 million. Continues _____________________________________________________________________________________________________________ ANNUAL REPORT 2006 / Consolidated Financial Statements 83
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ISS Global A/S Bredgade 30 DK - 126
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Key Figures Amounts in DKK millions
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growth. Furthermore, the effect of
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In 2006, ISS Global continued the p
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to costs related to a turnaround pl
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structure, ISS established an Opera
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Strategy ISS Global is a fully owne
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Geography ISS intends to increasing
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Openness and transparency In additi
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tors. The controllers perform follo
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Risk Factors ISS Global is a fully
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tual obligations could harm ISS’s
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If ISS fails to manage growth and i
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ISS may incur substantial liabiliti
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thus reduce or prevent dividend pay
Page 31 and 32: Independent Auditor’s Report To t
Page 33 and 34: Organic growth ISS Global uses esti
Page 35 and 36: 2006 primarily related to redundanc
Page 37 and 38: Tempo as well as a number of smalle
Page 39 and 40: including non-interest-bearing debt
Page 41 and 42: CONSOLIDATED CASH FLOW STATEMENT 1
Page 43 and 44: CONSOLIDATED STATEMENT OF TOTAL REC
Page 45 and 46: NOTES TO THE CONSOLIDATED FINANCIAL
Page 81: NOTES TO THE CONSOLIDATED FINANCIAL
Page 103 and 104: CASH FLOW STATEMENT OF THE PARENT C
Page 105 and 106: STATEMENT OF TOTAL RECOGNISED INCOM
Page 107 and 108: NOTES TO THE FINANCIAL STATEMENTS O
Page 123: Definitions EBITDA = Operating prof
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Annual Report 2006 ISS Global A/S

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