SECURITAS AB Annual Report 2011

84 Annual Report
Notes and comments to the consolidated financial statements
Note 3. Definitions, calculation of
key ratios and exchange rates
DEFINITIONS
Statement of income according to Securitas’ financial model
Production expenses 1
Guard wages and related costs, the cost of equipment used by the guards
when performing professional duties, and all other costs directly related to
the performance of services invoiced.
Selling and administrative expenses 1
All costs of selling, administration and management including branch office
expenses. The primary function of the branch offices is to provide the production
with administrative support as well as to serve as a sales channel.
Gross margin
Gross income as a percentage of total sales.
Operating income before amortization
Operating income before amortization of acquisition related intangible
assets, acquisition related costs and items affecting comparability, but
including amortization and depreciation of other intangible assets, buildings
and land and machinery and equipment.
Operating margin
Operating income before amortization as a percentage of total sales.
Operating income after amortization
Operating income after amortization of acquisition related intangible assets,
acquisition related costs, items affecting comparability and including amortization
and depreciation of other intangible assets, buildings and land and
machinery and equipment.
Adjusted income
Operating income before amortization, adjusted for financial income and
expenses (excluding revaluation of financial instruments according to
IAS 39) and current taxes.
Net margin
Income before taxes as a percentage of total sales.
Real change
Change adjusted for changes in exchange rates.
Statement of cash flow according to Securitas’ financial model
Cash flow from operating activities
Operating income before amortization adjusted for depreciation / amortization
less capital expenditures in non-current tangible and intangible assets
(excluding acquisitions of subsidiaries), change in accounts receivable and
changes in other operating capital employed.
Free cash flow
Cash flow from operating activities adjusted for financial income and
expenses paid and current taxes paid.
Cash flow for the year 1
Free cash flow adjusted for acquisitions of subsidiaries, acquisition related
costs paid, cash flow from items affecting comparability, dividends, new
issues and change in interest-bearing net debt excluding liquid funds.
1 The definition is also valid for the formal primary statements – the statement of income and the statement of cash flow.
2 There are no convertible debenture loans. Consequently there is no difference between earnings per share before and after dilution.
3 Number of shares includes shares related to the Group’s share based incentive scheme that have been hedged through a swap agreement.
Securitas Annual Report 2011
Balance sheet according to Securitas’ financial model
Operating capital employed
Capital employed less goodwill, acquisition related intangible assets and
shares in associated companies.
Capital employed
Non interest-bearing non-current and current assets less non interest-
bearing long-term and current liabilities.
Net debt
Interest-bearing non-current and current assets less long-term and
short-term interest-bearing loan liabilities.
CALCULATION OF KEY RATIOS 2011
Acquired sales growth: 8%
This year’s sales from acquired business as a percentage of the previous
year’s total sales.
Calculation: 5 061.5 /61 339.8 = 8%
Organic sales growth: 3%
Total sales for the year adjusted for acquisitions and changes in exchange
rates as a percentage of the previous year’s total sales adjusted for divestitures.
Calculation: ((64 057.1-5 061.5+4 228.7) /(61 339.8-19.8))-1 = 3%
Real sales growth: 11%
Total sales for the year including acquisitions and adjusted for changes
in exchange rates as a percentage of the previous year’s total sales.
Calculation: ((64 057.1+4 228.7) /61 339.8)-1 = 11%
Operating margin: 5.3%
Operating income before amortization as a percentage of total sales.
Calculation: 3 384.7 /64 057.1 = 5.3%
Earnings per share before dilution 2,3 : SEK 4.75
Net income for the year attributable to equity holders of the Parent
Company in relation to the average number of shares before dilution.
Calculation: ((1 738.6-2.9) /365 058 897) x 1 000 000 = SEK 4.75
Earnings per share before dilution 2,3 and before items
affecting comparability: SEK 4.75
Net income for the year before items affecting comparability (after tax)
attributable to equity holders of the Parent Company in relation to the
average number of shares before dilution.
Calculation: ((1 738.6+0.0-2.9) /365 058 897) x 1 000 000 = SEK 4.75
Cash flow from operating activities as % of operating
income before amortization: 62%
Cash flow from operating activities as a percentage of operating income
before amortization.
Calculation: 2 107.4 /3 384.7 = 62%
Free cash flow as % of adjusted income: 39%
Free cash flow as a percentage of adjusted income.
Calculation: 868.4 /(3 384.7-496.1-680.1) = 39%
Free cash flow in relation to net debt: 0.08
Free cash flow in relation to closing balance net debt.
Calculation: 868.4 /10 348.8 = 0.08