I. Table of Contents - ISS

tatiana\Bank Book\Public Bank Book\FINAL ISS PUBLIC Bank IM - Press Release to EMTN_1.doc 9 Nov 2005 10:32 74/91
74
Historical Financial Information
Current Assets
Current assets (less liquid funds) amounted to 18.9% of revenues in 2004, which is a decline
compared to 2000 when it accounted for 19.2%. This relative decline in current assets has been driven
by accounts receivables, which represent approximately 84% of total current assets. The number of
days of revenues outstanding has been stable in 2004 but is lower than the higher levels in 2001 (49
days) and 2002 (47 days).
Inventories comprise mainly raw materials, supplies and finished goods. Contract work in progress has
increased in the period 2000-2004 with the exception of 2003 when it decreased. The increase is
related to management focusing more on integrated facility services, and also the fact that contracts
are increasing in size and scope.
Current Liabilities
The majority of current liabilities relate to employee-related liabilities such as accrued salaries and
holiday allowances. Trade payables increased in the period 2000-2004, but the increase is in line with
the development of cost of goods sold and other operating expenses, hence current liabilities in
relation to revenues have remained stable. Current liabilities have been impacted by an increase in
prepayments from customers, as the company has continuously focused on generating cash flows.
Total Non-Current Liabilities
Provisions include pensions, deferred tax liabilities, and other provisions. As the company operates in
various countries, there are different forms of pension schemes. The Group contributes to defined
contribution plans as well as defined benefit plans. As of September 30, 2005, the Company had
pension and similar obligations on its balance sheet equal to DKK 802 million, which comprise pension
in relation to the defined benefit plans 14 . Provisions increased in the first nine months of 2005 due to
adoption of IFRS regarding actuarial losses related to pensions. Other provisions include labour
related items, self insurance, acquisitions and other which combined, have remained stable at around
1.4% - 1.6% of revenues during 2000-2004 under Danish GAAP.
14 ISS 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 has no legal or constructive obligation to pay further contributions irrespective of the funding of these insurance
companies. Pension costs related to such plans are recorded as expenses when incurred. For further information about ISS's pension
program, please refer to the Mercer Pension Report.