simona worldwide · 2015. 11. 13. · simona ag investor relations teichweg 16 d-55606 kirn phone...
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SIMONA AGInvestorRelationsTeichweg16D-55606Kirn
Phone+49 (0) 67 5214-0Fax +49 (0) 67 5214-211
11FinancialReportofSIMONAGroupandSIMONAAG 02May2011
AnalystConferencefor2010AnnualResults(Frankfurt) 04May2011
InterimAnnouncementwithintheFirstHalf 04May2011
AnnualGeneralMeeting 01July2011
PublicationofGroupFinancialReport(Half-Year) 24August2011
InterimAnnouncementwithintheSecondHalf 09November2011
FinancialCalendar
SIMONAworldwide➝
01 COMpANY
ManagementBoard 02
LettertoShareholders 03
KeyEvents 04
StockPerformanceandCapitalMarkets 06
ReportbytheSupervisoryBoard 07
CorporateGovernanceReport 11
GoverningBodies 14
Shareholdings 15
02 GrOup MANAGeMeNt repOrt
BusinessActivitiesandGeneralConditions 17
FinancialPerformance 23
FinancialAssetsandLiabilities 24
FinancialPosition 24
EventsaftertheReportingDate 26
RiskReport 26
ReportonExpectedDevelopments 27
OtherInformation 28
03 GrOup FINANCIAl StAteMeNtS
GroupIncomeStatement 36
GroupStatementofComprehensiveIncome 37
GroupStatementofFinancialPosition 38
NotestoConsolidatedFinancialStatements 39
GroupStatementofCashFlows 74
GroupStatementofChangesinEquity 75
DetailsofShareholdings 76
Auditor’sReport 77
OtherInformation 78
04 FINANCIAl StAteMeNtS OF SIMONA AG (eXCerpt)
BalanceSheet 80
IncomeStatement 82
OtHer
Imprint 84
FinancialCalendar Cover
SIMONAWorldwide Cover
2010SIMONA Group – Consolidated Financial Statements
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SIMONA AMerICA Inc.
SIMONA S.A. paris
SIMONA AG Werk III
SIMONA-plAStICS CZ, s.r.o.
SIMONA FAr eASt lIMIted
SIMONA uK lIMIted
SIMONA AG SCHWeIZ
SIMONA pOlSKA Sp. z o.o.
SIMONA eNGINeerING plAStICS (Guangdong) Co. ltd.
SIMONA eNGINeerING plAStICS trAdING (Shanghai) Co. ltd.
SIMONA AG SIMONA plast-technik s.r.o.
SIMONA IBerICA SeMIelABOrAdOS S.l.
SIMONA S.r.l. ItAlIA
SIMONAworldwide
SIMONA GrOup*
2010 2009 2008
Revenue € m 267.4 215.1 303.7
Year-on-yearchange % 24.3 –29.2 1.3
ofwhichabroad € m 176.8 138.6 191.6
ofwhichabroad % 66.1 64.4 63.1
Staffcosts € m 55.9 55.3 58.2
Profitbeforetaxes € m 10.5 7.1 20.2
Profitfortheyear € m 7.2 5.0 13.9
Netcashfromoperatingactivities € m 3.1 28.2 44.7
EBIT € m 10.1 7.3 19.8
EBIT % 3.8 3.4 6.5
EBITDA € m 22.7 21.9 32.3
EBITDA % 8.5 10.2 10.6
Totalassets € m 245.0 244.7 244.8
Equity € m 162.2 157.5 157.6
Non-currentassets € m 89.4 94.3 97.1
Investmentsinproperty,plantandequipment € m 6.5 11.6 21.2
Employees(annualaverage) 1,218 1,230 1,237
*basedonIFRS
KeyFinancials
reVeNue ANd eBIt SIMONA GrOup
in € millions
300 24
250 20
200 16
150 12
100 8
50 4
0 0 Totalrevenue
2008 2009 2010 EBIT
reVeNue BY reGION SIMONA GrOup
in%
Germany
RestofEurope&Africa
Asia,America&Australia
51.9 53.4 49.6
11.3 11.2 16.6
36.8 35.4 33.8
2008 2009 2010
prOduCtION SIteS
plant I/IITeichweg16D-55606KirnGermanyPhone +49 (0) 67 5214-0Fax +49 (0) 67 5214-211
plant IIIGewerbestraße1–2D-77975RingsheimGermanyPhone +49 (0) 7822436-0Fax +49 (0) 7822436-124
SIMONA plast-technik s.r.o.UAutodílen23CZ-43603Litvínov-ChudeřínCzechRepublic
SIMONA AMerICA Inc.64N.ConahanDriveHazleton,PA18201USA
SIMONA eNGINeerING plAStICS (Guangdong) Co. ltd.No.368JinouRoadHigh&NewTechnologyIndustrialDevelopmentZoneJiangmen,GuangdongChina529000
SAleS OFFICeS SIMONA S.A. parisZ.I.1,rueduPlantLogerF -95335DomontCedexPhone +33 (0) 139 35 4949Fax +33 (0) 139 [email protected]
SIMONA uK lIMItedTelfordDriveBrookmeadIndustrialParkGB-StaffordST163STPhone +44 (0) 1785222444Fax +44 (0) [email protected]
SIMONA AG SCHWeIZIndustriezoneBäumlimattstraße16CH-4313MöhlinPhone +41 (0) 618 55 9070Fax +41 (0) 618 55 [email protected]
SIMONA S.r.l. ItAlIAViaPadanaSuperiore19/BI -20090Vimodrone(MI)Phone +390225 08 51Fax +390225 08 [email protected]
SIMONA IBerICA SeMIelABOrAdOS S.l.DoctorJosepCastells,26–30PolígonoIndustrialFonollarE-08830SantBoideLlobregatPhone +3493 635 4103Fax +3493 630 88 [email protected]
SIMONA AG
teichweg 16d-55606 KirnGermanyPhone +49 (0) 67 5214-0Fax +49 (0) 67 [email protected]
SIMONA-plAStICS CZ, s.r.o.Zděbradskául.70CZ-25101Říčany-JažlovicePhone +420 323 6378 3-7/-8/-9Fax +420 323 6378 [email protected]
SIMONA pOlSKA Sp. z o.o.ul.H.Kamieńskiego201–219PL-51-126WrocławPhone +48 (0) 713 52 80 20Fax +48 (0) 713 52 [email protected]
SIMONA FAr eASt lIMItedRoom501,5/FCCTTelecomBuilding11WoShingStreetFoTanHongkongPhone +85229 47 01 93Fax +85229 47 01 [email protected]
SIMONA eNGINeerING plAStICS trAdING (Shanghai) Co. ltd.RoomC,19/F,BlockAJiaFaMansion129DaTianRoad,JingAnDistrictShanghaiChina200041Phone +862162670881Fax [email protected]
SIMONA AMerICA Inc.64N.ConahanDriveHazleton,PA18201USAPhone +1866 501 2992Fax +1800 522 [email protected]
StOCK dAtA
2010 2009 2008
Earningspershare € 12.00 8.31 23.20
Dividend € 6.50 6.00 8.50
Dividendyield 2.1 1.9 2.6
P/Eratio* 26.3 38.1 14.0
Marketcapitalisation-over-equityratio* 1.17 1.21 1.23
sharepriceasatDec.31 € 315.00 317.00 324.00
*Eachcalculatedonconsolidatedbasis
2
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01 GrOup MANAGeMeNt repOrt
1.BusinessActivitiesand
GeneralConditions 5
2.FinancialPerformance 11
3.FinancialAssetsandLiabilities 12
4.FinancialPosition 12
5.EventsaftertheReportingDate 14
6.RiskReport 14
7.ReportonExpectedDevelopments 15
8.OtherInformation 16
02 GrOup FINANCIAl StAteMeNtS
GroupIncomeStatement 24
GroupStatementofComprehensiveIncome 25
GroupStatementofFinancialPosition 26
NotestoConsolidatedFinancialStatements 27
GroupStatementofCashFlows 62
GroupStatementofChangesinEquity 63
DetailsofShareholdings 64
Auditor’sReport 65
OtherInformation 66
03 SIMONA WOrldWIde
Contents
3
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1.BusinessActivitiesandGeneralConditions 05
2.FinancialPerformance 11
3.FinancialAssetsandLiabilities 12
4.FinancialPosition 12
5.EventsaftertheReportingDate 14
6.RiskReport 14
7.ReportonExpectedDevelopments 15
8.OtherInformation 16
GroupManagementReport
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1. BuSINeSS ACtIVItIeS ANd GeNerAl CONdItIONS
1.1. Organisation and legal structure of the SIMONA
Group
TheSIMONAGroupdevelops,manufacturesandmar-
ketsarangeofsemi-finishedthermoplastics,pipesand
fittingsaswellasfinishedparts.Thematerialsused
includepolyethylene(PE),polypropylene(PP),polyvinyl
chloride(PVC),polyethyleneterephthalate(PETG),poly-
vinylidenefluoride(PVDF)andethylene-chlorotrifluor-
oethylene(E-CTFE)aswellasvariousspecialistmateri-
als.Theproductionmethodsappliedwithinthisarea
rangefromextrusion,pressingandinjectionmouldingto
CNCmanufacturing.SIMONAalsomaintainsitsown
plasticslaboratoriesandworkshopsfortheproduction
ofcustomisedfittings.Semi-finishedproductsare
deployedmainlywithintheareaofchemicalequipment
andmechanicalengineering,thetransportindustry,the
constructionsector,theexhibitionanddisplaysectoras
wellastheautomotiveindustry.Pipesandfittingsare
usedprimarilyfordrinking-watersupply,sewagedis-
posalandindustrialpipingsystems,includingthe
chemicalprocessindustry.Finishedpartsaredestined
inparticularforthemechanicalengineeringandtrans-
porttechnologysectors.
TheSIMONAGroupmarketsitsproductsworldwide.The
salesstructureisprimarilybasedonthefollowingthree
salesregions:
� Germany
� RestofEuropeandAfrica
� Asia,AmericaandAustralia
Thesecondarysegmentsarecentredaroundproduct
areas(semi-finishedproductsaswellaspipesandfit-
tings).SalesactivitiesatGrouplevelareconductedby
SIMONAAGandsubsidiariesintheUnitedKingdom,
Italy,France,Spain,Poland,theCzechRepublic,Hong
Kong,ChinaandtheUnitedStates,bothdirectlyandvia
tradingpartners.Beyondthis,theAG(i.e.theparent
company)operatesasalesofficeinMöhlin,Switzerland.
Theparentcompany,SIMONAAG,hasitsregistered
officein55606Kirn(Germany).Intheperiodunder
review,theSIMONAGroupoperatedfacilitieslocatedin
Germanyandabroad.Semi-finishedproducts(sheets,
rods,weldingrods)aremanufacturedattwoplantsin
Kirn(Rhineland-Palatinate),whilesheetswereproduced
atthecompany’splantinKirchhundem-Würdinghausen
(NorthRhine-Westphalia)andpipes,fittingsandfinished
partsatafacilityinRingsheim(Baden-Württemberg).
ThefacilitybasedinHazleton(Pennsylvania,USA)man-
ufacturesextrudedsemi-finishedproductsdestined
mainlyfortheAmericanmarket.TheplantinLitvinov,
CzechRepublic,producessheetsandpipes,primarily
fortheEasternEuropeanmarket,whilethesiteinJiang-
men,China,manufacturesextrudedsheets.Thefactory
inKirchhundem-Würdinghausenwascloseddowneffect-
ivefrom30September2010.
InthefinancialyearunderreviewtheManagement
BoardconsistedofWolfgangMoyses(Chairman/CEO),
DirkMöller(DeputyChairman,since1May2010),
DetlefBeckerandJochenFeldmann(until10August
2010).In2010,themembersoftheSupervisoryBoard
includedHans-WernerMarx(Chairman),Dr.RolfGößler
(DeputyChairman),RolandFrobelandDr.RolandReber
asshareholderrepresentatives,aswellasBernd
MeurerandKarl-ErnstSchaab(until31August2010),
whorepresentedstaffinterests.
01 GrOup MANAGeMeNt repOrt
BusinessActivitiesandGeneralConditions
FinancialPerformance
FinancialAssetsandLiabilities
FinancialPosition
EventsaftertheReportingDate
RiskReport
ReportonExpectedDevelopments
OtherInformation
02GROUPFINANCIALSTATEMENTS 04FINANCIALSTATEMENTSOF
SIMONAAG(EXCERPT)
01COMPANY
5
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1.2. Business review
Significant growth in revenue
Theoverallrecoveryoftheworldeconomywasfaster
thananticipatedfollowingtheslumpinducedbythe
globalfinancialandeconomiccrisis.Afteradownturn
of0.9percentin2009,globalgrossdomesticproduct
rosesignificantlybyanestimated5percent.Having
saidthat,theworldeconomylostitsforwardmomentum
astheyearprogressed,withglobaltradefailingto
expandsignificantlyinthesecondhalfof2010.Global
economicperformancein2010clearlyillustratedthe
growingimportanceoftheemergingmarketswithinthe
contextofinternationaltrade.Whiletheemergingmar-
ketsinAsiareturnedtotheirpre-crisislevelsin2010,
productionintheindustrialisedcountriesagainfell
shortofthefiguresrecordedpriortotheeconomic
downturn.
Againstthisbackdrop,SIMONAAGsawitssalesrev-
enuerisesignificantlyfromMarch2010onwards,after
asluggishstarttotheyear.Remainingbuoyantuntilthe
endofthefinancialyear,salesrevenueincreasedby
24.3percentyearonyearto€ 267.4millionforthe
annualperiodasawhole(2009:€ 215.1million).Much
oftheimpetuscamefrommoreexpansiveinvestments
inmachineryandequipment,particularlyinthechemi-
calandmechanicalengineeringindustry.Revenuegen-
eratedbytheparentcompany,SIMONAAG,rosefrom
€ 191.1millionayearagoto€ 232.5millionin2010,
ayear-on-yearincreaseof21.7percent.
Germany
InGermany,GDPgrewby3.5percentin2010asa
whole–adjustedforpricesandworkingdays–andwas
dominatedbyreboundingmarketsastheeconomy
emergedfromthecrisis.Facedwithadouble-digitdown-
turnineconomicoutputoverthecourseof2009,the
manufacturingsector,inparticular,recordedastrong
performanceintermsofgrossvalueadded,whichrose
byanimpressive10.3percentin2010.Exportsrose
by14.2percentinthesameperiod.Investmentsin
machineryandequipmentwereup9.4percentonthe
figurerecordedin2009,althoughthisareahadbeen
worsthitbytheeconomicdownturn.Recoveryslowed
downslightlyinthefourthquarter,withGDPrisingby
just0.4percentcomparedtothepreviousquarter.
Exportsalsoprovedbuoyantinthefourthquarter,witha
year-on-yearincreaseof15.9percentintermsofgoods
andservicessoldabroad.
deVelOpMeNt OF reVeNue SIMONA GrOup
in€ m
300
275
250
225
200
175
150
125
100
2008 2009 2010
GrOup MANAGeMeNt repOrt
+1.3%
– 29.2%
+ 24.3%
6
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review of the principal sales segments and plastics
processing industry in 2010
TheGermanchemicalindustryrecordedan11percent
increaseinproductionvolume,withrevenuesexpanding
by17.5percent.Withinthiscontext,foreignmarkets
providedmuchoftheimpetus.Growthwaslesspro-
nouncedinthesecondhalfoftheyear.Germany’s
mechanicalandplantengineeringindustrymanagedto
expanditsproductionoutputby8.8percentin2010.
Orderintakeroseby36percentinrealterms,with
domesticordersincreasingby29percentandnon-
domesticordersexpandingby39percent.Theoverall
exportratiowithinthissectorroseto74.8percent
(2009:73.6percent).Thesolidperformancein2010is
reflectedinthelevelofcapacityutilisation,whichwasup
from72.5percentin2009to79.8percentin2010.
Afterthesignificantdeclinerecordedin2009,theinter-
nationalexhibitionandtradefairindustryinGermanywas
facedwithasluggishrecoveryintheperiodunderreview,
mainlyduetothefactthatstreamliningmeasuresagreed
in2009remainedinplacetosomeextent.Basedonini-
tialestimates,exhibitornumbersroseby1percent
(2009:–4percent),whiletheoverallnumberofvisitors
recededslightlyby2percent(2009:–8percent).
TheGermanconstructionindustryalsofailedtokeepup
withthegeneralpaceofeconomicrecoveryintheperiod
underreview.Revenuesintheprincipalconstruction
sectorcontractedby1percent(2009:–4percent)in
nominalterms.Thisdeclinewasattributabletothe
adverseeffectsfeltwithinthecommercialconstruction
sector(–4.5percent)andinthepublic-sectorsegment
(–3percent).
Basedonpreliminaryfigures,Germany’splastics-
processingindustrymanagedtoliftrevenuesby14per
centto€ 51.3billionin2010,thusalmostreturningto
thelevelrecordedin2008.At12.2milliontonnes,the
volumeofplasticsprocessedalsomovedcloser
towardsthefigureachievedin2008.Amongthe
principalgrowthdriversweresuppliersoftechnicalcom-
ponents,whoaccountedfor23percentofoverall
growth.Withintheareaofconsumerandotherplastic
goods,totalrevenueincreasedby14.7percentto
€ 16.4billion.Theconstructionsectorrecordedgrowth
of5percent,takingitstotalrevenueto€ 10.8billion.
Theplasticspackagingindustry,thelargestsegment
withintheplastics-processingsector,sawitsgrossout-
putriseby14percentto€ 12.2billion.Intermsof
value,however,thefigurewasdown2percentonlast
year’stotal.Thepositiveperformancewasdrivenmainly
byforeigntrade.At+15.5percent,exportsattributable
totheplastics-processingindustryoutpaceddomestic
sales(+14percent).Theexportratiorosefrom34.3
percentto35.7percentin2010.
Withcustomersinthechemicalandmechanicalengi-
neeringindustry–akeymarketforSIMONA–expanding
theircapitalexpenditureonmachineryandbenefiting
frombuoyantexports,SIMONAsawitsrevenuesurgein
theperiodunderreview.Salesrevenuesgeneratedin
Germanyroseby18.4percentto€ 90.6million(2009:
€ 76.5million).
01 GrOup MANAGeMeNt repOrt
BusinessActivitiesandGeneralConditions
FinancialPerformance
FinancialAssetsandLiabilities
FinancialPosition
EventsaftertheReportingDate
RiskReport
ReportonExpectedDevelopments
OtherInformation
02GROUPFINANCIALSTATEMENTS 04FINANCIALSTATEMENTSOF
SIMONAAG(EXCERPT)
01COMPANY
7
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Revenuebyproductgroup
70,6 € MIllIONS
SIGNIFICANt GrOWtH IN SAleS VOluMeS
Intheareaofsemi-finishedproducts,salesvolumesofPEandPPsheetsusedintankandapparatusconstructionrosesharply.Busi-
nessrelatingtofinishedpartsaswellasplasticsheetsdestinedforthephotovoltaicsandsolarpowerindustryalsodevelopedwell.The
GrouprecordedsignificantgrowthintheareaofPPpipesforindustrialapplications,whereasrevenuegeneratedthroughPEpipescon-
tracted.
+31,6 %+7,8 %
196,8 € MIllIONS
SeMI-FINISHed prOduCtS
pIpeS ANd FIttINGS
8
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europe and Africa
Grossdomesticproductintheeurozoneexpandedby
1.7percentin2010(prev.year:–4.0percent),while
theEU27regionrecordedgrowthof1.8percentinthe
sameperiod(prev.year:–4.2percent).
EconomicgrowthintheMiddleEastandNorthAfrica
stoodat3.9percentin2010.
RevenuefromsalesintheRestofEuropeandAfrica
alsorosesharplyduringtheperiodunderreview.In
WesternEurope,themostimportantmarketfor
SIMONA,thedownturnseenin2009hadnotbeenas
pronouncedasinotherregions.Asaresult,revenue
growthin2010wasbelowaverage.Intotal,theRestof
EuropeandAfricaaccountedforsalesrevenueof
€ 132.7million(2009:€ 115.4million).Thisrepres-
entsanincreaseof15.0percentcomparedto2009.
Asaregion,theRestofEuropeandAfricaaccountedfor
49.6percentoftotalrevenuegeneratedbySIMONA
AG,downonlastyear’sfigureof53.6percent.
America, Asia and Australia
At2.8percent(2009:–2.6percent),theUSeconomy
grewatalesspronouncedratethanmanyoftheother
industrialisedeconomies.NotonlyweretheAsianmar-
ketsthefirsttobeaffectedbytheeconomicandfinan-
cialcrisis,theyalsoborethebruntofthedownturn.On
amorepositivenote,theyledthewaywhenitcameto
economicrecovery.BothChina(+10.3percent)and
India(+9.7percent)returnedtotheirpre-crisislevelsof
growthin2010.SIMONAwasabletoreaptherewards
ofthistrendbygeneratingabove-averagerevenue
growthinAsia.InNorthAmerica,bycontrast,business
grewatalowlevel.Intotal,revenuefromsalesinAsia,
AmericaandAustraliaroseby82.9percentto€ 44.5
million.Asaresult,thisregionaccountedfor16.6per
centoftotalsalesrevenue,asignificantyear-on-year
increase.
Strong expansion of sales volumes of pe and pp
sheets as well as specialty plastics – Above-average
revenue growth for pipes and fittings
Intheareaofsemi-finishedproducts,salesvolumesof
PEandPPsheetsusedintanksandapparatusengin-
eeringrosesharplyin2010.Businessrelatingtoplastic
sheetsusedbythephotovoltaicsandsolarindustry
alsodevelopedwellintheperiodunderreview.Bycon-
trast,businesscentredaroundPVCsheetswasmore
sluggish.SIMONAalsosawafurtherincreaseinthe
overallsalesvolumeoffinishedparts.Productsmade
ofspecialtyplasticsshowedmoreforwardmomentum
thanbusinesswithintheareaofsemi-finishedplastics.
Intotal,revenuegeneratedfromsemi-finishedproducts
stoodat€ 196.8million,ayear-on-yearincreaseof
31.6percent.
SIMONA reVeNue BY reGION
in%
Germany
RestofEuropeandAfrica
Asia,America,Australia
01 GrOup MANAGeMeNt repOrt
BusinessActivitiesandGeneralConditions
FinancialPerformance
FinancialAssetsandLiabilities
FinancialPosition
EventsaftertheReportingDate
RiskReport
ReportonExpectedDevelopments
OtherInformation
02GROUPFINANCIALSTATEMENTS
2010
17
34
50
2009
11
35
54
04FINANCIALSTATEMENTSOF
SIMONAAG(EXCERPT)
01COMPANY
9
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Withintheareaofpipingsystems,thecompanyalso
succeededinexpandingsalesrevenues,albeitata
muchlesspronouncedratethanintheareaofsemi-fin-
ishedplastics.SalesvolumesofPPpipesforindustrial
applicationsrosesignificantly,whereasrevenuesgener-
atedintheareaofPEfittingsweredown.Thepipesand
fittingsproductsegmentrecordedrevenuegrowthof7.8
percentto€ 70.6millionintotal.
product development for safety-critical and
eco-specific applications
SIMONApursuesproductdevelopmentatvariouslevels.
OurTechnicalServiceCentreisresponsibleforreviewing
customerrequirementsandrefiningexistingproductsby
makingwell-judgedalterationstopolymerproperties,e.g.
bychangingthebasicformula.TheNewProducts&Applica-
tionsunitworksinclosecollaborationwithourproduct
managementtotestnewmaterialsanddevelopplastics
fornewfieldsofapplication.Committedtopromoting
energy-efficientartificialicerinks,SIMONAdeveloped
SIMONA®Eco-Ice®andlaunchedthenewproductatthe
beginningof2010.Incontrasttoconventionalicerinks,
installationsusingSIMONA®Eco-Ice®canbeoperated
withoutcoolingpipesandcoolantsforiceproduction.
Theiceskatescanbeuseddirectlyontheplasticpanels,
whicharesecurelyjoinedtooneanothertoformanice
rinksurface.SIMONA®Eco-Ice®issuppliedinvariouspol-
yethylenedesigns:PE-HD(highheatresistance),PE-HMW
(highmolecularweight)andPE-UHMW(ultra-highmolecu-
larweight).Inmid-2010,thesystemwasextendedto
includeperimeterboardsmadeofPEFOAMtwin-wall
sheets.Indehoplast®x-detect,anultrahigh-molecular-
weightpolyethylene,SIMONAhasdevelopedapremium
productforthefoodandpharmaceuticalindustries.In
theeventofafracture,evensmallplasticparticlescan
bedetectedinfoodbymeansofmetaldetectors.Devel-
opedin2009,thePVCsheetSIMOSHIELDfordoors,
manufacturedonthebasisofinlinefoilingtechnology,
waslaunchedontothemarketinearly2010.ThePVC
free-foamsheetSIMOPOR-DIGITAL,whichwasdeveloped
fordigitaldirectprinting,wasalsolaunchedontotheEuro-
peanmarketin2010.Withintheareaofpolyolefins,we
carriedouttechnicalrefinementstothefoamedsheets
PEFOAMandPPFOAM.ThePEFOAMlinewasextended
toincludeatwin-wallsheetthatisusedprimarilyfor
perimeterboardsandhousingsaswellasnoiseandheat
insulation.
Inthefieldofpipingsystems,welaunchedanadvanced
SIMONA®PP-HAlphaPlus®pipingsystemtailoredspecific-
allytothegeothermalindustry;itiscapableofwithstand-
ingextremethermal,mechanicalandhydraulicstresses.
Elsewhere,theSIMOFUSE®joiningmethod,firstdevel-
opedforwastewatermanagementinnon-pressurised
applications,hasbeenrefinedtomeettherequirements
ofthepowersupplyindustryanditsdemandsforsustain-
ablesolutions.SIMOFUSE®pipemodulescanbesupplied
indiametersofupto1,000mm.Followingthesuccessful
marketlaunchofprotective-jacketpipesmadeofPE,
SIMONA–asthefirstmanufacturerworldwide–commis-
sionedanindependenttestingunittoassessthefullRC
(ResistancetoCracking)fittingsportfolioinaccordance
withPAS1075.Thetestresultswerehighlyencouraging.
Inpipeextrusion,initialproductiontestingwasconducted
forpipeswithawear-resistantinteriorskin.Theaimisto
developapipewithahighlevelofabrasionresistancefor
thetransportofsolidmaterials.
Researchanddevelopmentexpensesaremainlycom-
prisedofstaffcosts,materialcostsanddepreciation/
amortisationofnon-currentassets.Owingtotheinterrela-
tionshipbetweencustomer-specificmanufacturingproce-
dures,optimisationmeasureswithintheareaofprocess
engineeringandformulaeaswellasproductdevelopment
itself,theabove-mentionedexpensescannotbeclearly
segregatedfromproductioncosts.
GrOup MANAGeMeNt repOrt
10
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2. FINANCIAl perFOrMANCe
earnings
Againstthebackdropofgradualeconomicrecovery,the
SIMONAGroupsawitsearningsbeforeinterest,taxes
andincomefromequityinvestments(EBIT)riseby€ 2.8
millionto€ 10.1million.TheEBITmarginstoodat3.8
percent,upfromamarginof3.4percentlastyear.
Rawmaterialpricescontinuedtospiraloverthecourse
of2010.Withinthiscontext,theGroupwasunableto
passonthesepricehikesinfull.Asaresult,theper-
centageincreaseinexpensesrelatingtorawmaterials
andconsumableswasmorepronouncedthanthelevel
ofrevenuegrowth.Intotal,thecostofmaterialsroseby
49percentyearonyearto€ 154.4million(2009:
€ 103.7million).Followingasignificantreductionin
2009,thecostsattributabletoenergyandwateredged
upby€ 0.9millionintheperiodunderreviewasa
resultofhigherproductionoutput.
Inviewofexpandingsales,thegrossprofitfor2010
roseby€ 8.5millionto€ 125.5million,whichrepre-
sents47percentofrevenue.
Owingtohighercommoditypricesandinventorystream-
lining,thechangeininventories,aspresentedinthe
incomestatement,amountedto€ 5.3million.
Otheroperatingincomecontractedmarginally,down
€ 0.2millionto€ 7.2million.
At€ 55.9million,staffcostswereslightlyhigherthan
thefigurerecordedayearago(2009:€ 55.3million).
Depreciationofproperty,plantandequipmentand
amortisationofintangibleassetsfellby€ 1.9millionto
€ 12.6millionasaresultofimpairmentchargesrecog-
nisedin2009.
Otheroperatingexpensesroseby€ 7.1millionto
€ 46.9million.Againstthebackdropofmoreexpansive
business,theGroupincurredhighercostsrelatingto
outwardfreightandpackaging,inparticular,aswellas
seeingariseinmaintenancecostsformanufacturing
systems.
Theperformancesoftheindividualsubsidiariesdiffered
fromregiontoregion.Withinthiscontext,earningsper-
formancewasencouraginginPoland,theUnitedKing-
domandtheCzechRepublic.Bycontrast,theresults
postedinItalyandparticularlyFrance,whichincurred
lossesasaresultofrestructuringmeasures,wereless
satisfactory.
TheproductioncompanyintheCzechRepublicisoper-
atingataprofitablelevel.
TheUS-basedsubsidiarypostedaloss,althoughits
earningsperformanceimprovedmarkedlyinayear-on-
yearcomparison.Aprofithasbeenbudgetedforfiscal
year2011.
TheperformanceofoursalescompaniesinAsia
improvedsubstantiallyintheyearunderreview.Our
plantinChinaisstillinthestart-upphaseandhasyet
togenerateaprofit.
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02GROUPFINANCIALSTATEMENTS 04FINANCIALSTATEMENTSOF
SIMONAAG(EXCERPT)
01COMPANY
11
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eBIt margin
ThekeyfinancialindicatorsusedbySIMONAforthepur-
poseofanalysingandcontrollingoperatingresultsare
EBIT(earningsbeforeinterestandtaxes)andEBITDA
(earningsbeforeinterest,taxes,depreciationandamor-
tisation).EBITrepresentstheoperatingresultbefore
interestandtaxesaswellastheeffectsofequity
investments.InthecaseofEBITDA,non-cashdeprecia-
tionofproperty,plantandequipmentaswellasamorti-
sationofintangibleassetsareaddedtotheEBITfigure.
BothEBITandEBITDAcanthusbeusedforthepurpose
ofevaluatingacompany’searningsperformance,in
additiontoprovidinganapproximationofcashflow.
Earningsbeforeinterestandtaxesamountedto€ 10.1
million,resultinginanEBITmarginof3.8percent.
EBITDAatGrouplevelroseslightlyto€ 22.7million
(2009:€ 21.9million),withamortisationofintangible
assetsanddepreciationofproperty,plantandequip-
mentcontractingyearonyear.At8.5percent,the
EBITDAmarginremainedjustunderthefigureof10.2
percentrecordedinpreviousfinancialyear.
3. FINANCIAl ASSetS ANd lIABIlItIeS
Thefinancialassetsmainlycomprisecashandshort-
termbankdepositstotalling€ 39.3million(2009:
€ 61.5million).Additionally,theGroupmadeasecur-
itiesinvestmentincoveredbonds(Pfandbriefe)totalling
€ 10.0millionin2010.
Non-currentfinancialliabilitieswerescaledbackby
€ 2.1millionto€ 4.8millioninthefinancialyearunder
review.Thereductionwasattributabletotheearlyrepay-
mentofaloanamountingtoGBP2.0millioninrespect
ofSIMONAUKLtd.,whichwasreplacedbyGroupfunds.
In2010,currentfinancialliabilitiesdeclinedasaresult
ofthescheduledrepaymentofaUSD5.0millionloan,
theprincipalbeingdueatthefinalmaturitydate.Along-
sidecurrentfinancialliabilities,theGrouphadaddi-
tionalfinancialliabilitiesof€ 0.2millioninconnection
withaninterestrateswaptohedgetheriskassociated
withaUSdollarloan.
Otherfinancialobligationstotalling€ 2.9million(2009:
€ 3.1million)wereattributabletorentalandleaseagree-
ments.Ofthistotal,anamountof€ 1.3millionisdue
withinoneyear.Atotalof€ 1.9millionincurrentobliga-
tionsisattributabletocontractsalreadyawardedaspart
ofcapitalexpenditureprojects.
Basedonfinanceincomeof€ 1.0millionandfinance
costof€ 0.6million,netfinanceincomeamountedto
€ 0.4millionin2010(2009:€ –0.2million).
4. FINANCIAl pOSItION
Higher equity ratio
At31December2010totalassetsremainedlargely
unchangedat€ 245million.
DespitefurtherinvestmentsinnewplantsinLitvinov
(CzechRepublic)andJiangmen(China),thetotalcarry-
ingamountofproperty,plantandequipmentfellby
€ 4.7millionintheperiodunderreview,asdepreciation
andwrite-downsexceededtotalcapitalexpenditure.
Rawmaterialsandconsumablesroseby€ 1.7million
yearonyear,whilefinishedgoodsandmerchandise
increasedby€ 4.8million.
Highertradereceivables,up€ 8.5millionto€ 41.8mil-
lion,wereareflectionofmorepronouncedrevenue
growthin2010.
GrOup MANAGeMeNt repOrt
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Revenuebyregion
€44,5 MIllION*
€90,6 MIllION*
€132.7 MIllION*
AM
er
IKA
Ger
MA
NY
eu
rO
pe &
AFr
ICA
AS
IeN
33,8 %
16,6 %
49,6 %
prOGrAMMe OF INterNAtIONAlISAtION BeArS FruIt
TheGroupincreaseditsrevenuemarkedlyinallsalesregions.ThebuoyantAsianmarketsaccountedforsignificantgrowthintheregion
America,Asia&Africa.Thisregiongenerated16.6percentoftotalrevenuewithintheSIMONAGroup,upfrom11.2percentayearago.
TheGroup‘ssolidperformanceisatestamenttoitsincisivestrategyofinternationalexpansion.
*RoundingdifferencesduetoGroupeliminations13
-
Otherfinancialassetscomprisecapitalisedcorporation
taxcreditsofSIMONAAGamountingto€ 4.5million,
theeconomicbenefitsofwhichwillflowtothecompany
after31December2010.Theentitlementwasrecog-
nisedasanassetinthestatementoffinancialposition
asat31December2010inanamountequivalentto
thepresentvalue.
Cashandcashequivalentsfellby€ 22.1million,mainly
asaresultofinventorydownsizing,anincreasein
receivables,asecuritiesinvestmentincoveredbonds
andtherepaymentoffinancialliabilities.Theseaspects
arepresentedintheStatementofCashFlowsinthe
notestotheconsolidatedfinancialstatements.
Equityroseby€ 4.7millioninthefinancialyearunder
review,whileliabilitieswerescaledbackbythesame
amount.
Attheendofthefinancialyear,Groupequityamounted
to€ 162.2million(2009:€ 157.5million).Thisfigure
includesannualprofitof€ 7.2millionandadividend
paymentof€ 3.6millionin2010.TheGroupequity
ratioatthereportingdatewas66percent(2009:64
percent).
Attheendofthereportingperiodtradepayables
amountedto€ 11.2million,up€ 4.3millionyearon
yearduetomorebuoyantbusiness.
Othercurrentprovisionsdeclinedby€ 3.6million,prim-
arilyduetotheutilisationofrestructuringprovisionsin
connectionwiththeclosureoftheplantinKirchhundem-
Würdinghausen.
5. eVeNtS AFter tHe repOrtING dAte
Therewerenoeventsofmaterialsignificancetothe
stateofaffairsoftheSIMONAGroupintheperiod
betweentheendofthe2010financialyearandthe
preparationofthismanagementreport.Beyondthisand
inaccordancewithstatutoryprovisions,interim
announcementswillbeissuedduring2011,outlining
thedevelopmentoftheentityandanyeventsthatare
subjecttodisclosurerequirements.
6. rISK repOrt
TheriskmanagementsystemofSIMONAAGcontrols
thefollowingmaterialrisks:risksrelatingtothegeneral
businessenvironmentandsector,financialrisksandIT-
specificrisks.
Therisksassociatedwiththegeneralbusinessenviron-
mentandthesectorinwhichthecompanyoperates
relatemainlytotheeconomicdevelopmentofcustomer
segmentsservedbySIMONA.Theyalsoincludeexchange
rateandcommoditypricevolatilityaswellastheavail-
abilityofrawmaterials.Owingtoourbroadrangeof
productsandthoroughanalysisofthemarket,weare
abletomitigatetheserisksandrespondtochanges.
TheproductionfacilitiesintheUnitedStates,Chinaand
theCzechRepublicwillhelpustoimprovethecompa-
ny’sflexibilitywhenitcomestomeetingnewcustomer
requirementsatagloballevel.
Pricerisksassociatedwithexchangeratestendto
increaseinproportiontorevenuegeneratedbySIMONA
outsidetheeurozone.Theexpansionofproductionin
foreignsalesmarketshashelpedtoscalebackrisks
withinthisarea.Sector-specificriskswillcontinueto
beafocalpointofourriskmanagementduring2011.
Bothrevenueandearningsperformancein2011willbe
dependenttoalargeextentondevelopmentswithinthe
salesmarketsprimarilytargetedbySIMONA.Against
thebackdropofamorefavourableeconomicclimate,
therisksituationisnowconsideredmuchlesspro-
nounced.Bycontrast,therisksassociatedwithcom-
GrOup MANAGeMeNt repOrt
14
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moditypriceshaveincreasedduringthefirstmonthsof
2011andarelikelytobeakeyfactorinearningsper-
formancefor2011asawhole.Initiatedtwoyearsago,
thetransitionfromquarterlytomonthlycontractsfor
ethyleneandpropylenehasledtosignificantpricevol-
atilityfordownstreamproducts.
Asregardsreceivables,theriskofdefaultismitigated
bymeansofextensivecreditratingchecksinthecase
ofnewaccountsandongoingassessmentsofthecredit
ratingsofexistingcustomers.Default-relatedriskasso-
ciatedwithspecificcustomersislimitedbycreditinsur-
anceandthecut-offofdeliveriesinthecaseofout-
standingpayments.Thecarryingamountsofinventories
areassessedonaregularbasis,andadjustmentsin
theformofallowancesweremadeforspecificunsale-
ableproducts.
Risksattributabletoinformationtechnologyarecon-
trolledGroup-widebythecompany’sownITdepartment,
whosetaskistomanage,maintain,refineandprotect
theITsystemsonacontinualbasis.
Attheendofthe2010financialyear,weareofthe
opinionthattheoverallrisksituationforthecompany
hasimprovedslightlyasaresultofthefactorsoutlined
above.
Corporate Governance Statement
Thedeclarationoncorporategovernancepursuantto
Section289a(1)sentences2and3oftheGerman
CommercialCode(Handelsgesetzbuch–HGB)hasbeen
publishedbySIMONAAGonitscorporatewebsiteat
www.simona.de.
7. repOrt ON eXpeCted deVelOpMeNtS
Growth with considerable risks
Theglobaleconomylostmostofitsdynamismtowards
mid-2010,withthemajorityofthedevelopedcountries
recordingsubduedGDPgrowthinthefourthquarterof
2010.However,indicatorsimprovedagaintowardsthe
endoftheyear,whichwasunderlinedbythesignificant
expansionoftheworldeconomysincethebeginningof
2011.Havingsaidthat,therearesignsofbifurcation:
theemergingmarkets–particularlyinAsia–have
returnedtoorexceededtheirpre-crisislevelsandcur-
rentlyruntheriskofoverheating,whereasmanyofthe
developedeconomies–suchastheUnitedStates,the
UnitedKingdomandSpain–havebeensluggish.The
globaleconomyisexposedtocertainriskswithregard
toitsfutureperformance.Withinthiscontext,spiralling
commoditypricesrepresentoneofthemostpotent
risks.Thepriceofcrudeoilhassurgedinthewakeof
thepoliticalupheavalwitnessedthroughouttheArab
world.Governmentsintheemergingmarketswillbe
forcedtocounteracttherisktostabilitythatisgenerally
associatedwithaneconomicboom.Itremainstobe
seentowhatextentthepriceofcrudeoilandglobal
economicperformanceasawholewillbeaffectedby
thenaturalandnucleardisasterinJapan.
InJanuary,theInternationalMonetaryFund(IMF)pro-
jectedglobaleconomicgrowthof4.4percentfor2011.
However,thelatestforecastsissuedbyeconomistssug-
gestthatgrowthwillbelesspronounced.TheIMFagain
anticipatesstronggrowthforChina(+9.6percent)and
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02GROUPFINANCIALSTATEMENTS 04FINANCIALSTATEMENTSOF
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01COMPANY
15
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India(+8.4percent).TheRussianeconomyisexpected
toexpandby4.5percent.Recoverythroughoutthe
eurozoneremainssluggish;againstthisbackdrop,GDP
isforecasttogrowbyjust1.7percent.TheUSeco-
nomyisexpectedtogainsomemomentum,withesti-
matedgrowthof3.0percentin2011.
SIMONAanticipatesthattheoverallordersituationwill
remainsolidin2011.Orderintakeremainsstableata
highlevel.Followingthedownturn,thereremainssignifi-
cantpotentialwithregardtocapitalexpenditureon
machineryandequipment–ofparticularrelevanceto
ourbusiness–withinkeysalesmarkets.Inaddition,
demandislikelytobebuoyedbyexporttradeonthe
partofcustomersoperatingwithinthechemicaland
mechanicalengineeringindustry.Pipingsystemsengin-
eeringisexpectedtodevelopatamoresubduedrate.
Short-timeworkwaspartiallyintroducedattheRings-
heimplant,whichproducedpipesandfittings.
Elevatedcommoditypricescontinuetoexertdownward
pressureonourgrossprofitmargin,asthepercentage
ofmaterialcostsattributabletoourproductsissignifi-
cant.Itwillbedifficulttopassthesehighercostsonto
customerswithinthehighlycompetitivemarketsof
Europe.
TheSIMONAGroupwillbelookingtopropelrevenue
furthertoatleast€ 290millionforthefinancialyear
2011asawhole.Despitethecontinuedriseincom-
modityprices,profitablegrowthremainsatoppriority
forSIMONA;thetargetforGroupearningsbeforetaxes
hasbeensetat€ 15million.Ourfocusforthefuture
willbeonextrudedsemi-finishedthermoplasticsand
relatedproductsforsafety-criticalandeco-specific
applications.Wehavealsoidentifiedopportunitiesfor
growthwithintheareaofenergyutilitiesandcommo-
dities,environmentalengineeringandagriculture/food
manufacturing.
Owingtotheuncertaintiesassociatedwiththecommod-
itymarketsaswellastheinconsistenteconomictrends
andtheriskofunforeseenevents,suchasrecentdevel-
opmentsinJapan,providingaperformanceoutlookfor
2012isdifficult.Giventhegrowthopportunitieseman-
atingfromtheemergingmarketsandthenewfocuson
safety-criticalandeco-specificapplications,SIMONA
anticipatesthatitsbusinessperformancewillremain
favourablebeyondthefinancialyear2011.
8. OtHer INFOrMAtION
employees
Inaggregate,thenumberofpeopleemployedwithinthe
SIMONAGroupremainedstablein2010.Attheendof
thereportingperiod,theGroupheadcountstoodat
1,236(2009:1,234).Withinthiscontext,theclosureof
ourplantinKirchhundem-Würdinghausenandthedis-
continuationoftwologisticssitesinFrancepushedthe
Group’sheadcountdown,whiletherecruitmentefforts
atthenewproductionfacilityinJiangmen,China,
resultedinnewjobsbeingcreatedwithintheGroup.The
averagenumberofemployeeswithintheGroupwas
1,218.Asat31December2010,theheadcountforthe
parentcompany,SIMONAAG,was910(2009:957).
Attheendof2010,54youngpeople(2009:59)were
enrolledinvocationalprogrammesrelatingtooneof
seventechnicalandcommercialtrainingcourses.In
total,18apprenticessuccessfullycompletedtheirvoca-
tionaltrainingprogrammes;nineofthemwereoffered
permanentemploymentcontracts.Twoapprentices
optedforanintegrateddegreecourseofferedby
SIMONAincooperationwiththeUniversityofApplied
SciencesLudwigshafen.At31December2010,6
femalemembersofstaffwereonparentalleave.Atthe
endof2010,60membersofstaff(2009:64)had
optedforearlypart-timeretirement.
GrOup MANAGeMeNt repOrt
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02GROUPFINANCIALSTATEMENTS
In2010,SIMONAextendeditsBalancedScorecardasa
strategicmanagementinstrumenttoincorporateother
organisationallevelswithinthecompany.In-housetrain-
ingwithinthecontextofacross-companyprojectaimed
atimprovingtheorderprocessformedoneofthefocal
pointsofHRdevelopmentintheyearunderreview.Addi-
tionally,thecompanyorganisedanumberofpersonal-
isedspecialisttrainingschemesanddrewupaconcept
fortheestablishmentofatalentpromotioncircle,which
willcommencein2011.
In2011,theemphasiswithregardtoITwasonstand-
ardisingtheSAPmodulesusedwithintheGroupand
introducingSAPinfullatSIMONAAMERICAInc.Further-
more,therollouttemplaterelatingtotheSAPmodule
HumanResourceswasextendedandinitialpreparations
weremadeforreleasemigration.
Significant elements of the internal control and man-
agement system
Overallresponsibilityfortheinternalcontrolsystemwith
regardtothefinancialandtheGroupfinancialreporting
processrestswiththeManagementBoard.Allentities
includedwithintheconsolidatedgrouphavebeeninteg-
ratedwithinthissystembymeansofclearlydefined
managementandreportingstructures.
Theinternalcontrolsystem,whichimplementsspecific
controlswithregardtothefinancialreportingprocess,
isaimedatprovidingreasonableassurancethatannual
financialstatementscanbepreparedinaccordance
withstatutoryrequirementsdespitepossiblerisks.The
riskmanagementsystemincludesthefullrangeof
guidelinesandmeasuresrequiredtoidentifyriskandto
manageriskassociatedwithcommercialoperations.
Thepolicies,thestructuralandproceduralorganisation
aswellastheprocessesoftheinternalcontrolandrisk
managementsystemoperatedinrespectoffinancial
reportinghavebeenincorporatedinguidelinesand
organisationalinstructionsthatarerevisedregularlyto
accountforthelatestexternalandinternaldevelop-
ments.Asregardsthefinancialreportingprocess,we
considerthoseelementstobeofsignificancetothe
internalcontrolandriskmanagementsystemthatmay
potentiallyinfluencefinancialreportingandoverall
assessmentoftheannualfinancialstatements,includ-
ingthemanagementreport.Theseelementsareasfol-
lows:
� Identificationofsignificantareasofriskandcontrol
withaninfluenceoverthegroup-widefinancial
reportingprocess
� Monitoringofthegroup-widefinancialreportingpro-
cessandanyfindingstherefromatManagement
Boardlevel
� Preventativemeasuresofcontrolwithregardto
groupaccountingaswellassubsidiariesincludedin
theconsolidatedgroup
� MeasuresthatsafeguardtheappropriateIT-based
preparationofitemsanddataofrelevancetofinan-
cialreporting
Quality and environmental management
ThegoalofSIMONA’squalitymanagementistoensure
thatthequalityofitsproductsandprocessesissafe-
guardedandoptimisedonacontinualbasis.Withinthis
context,theaimistoachieveaconsistentlyhighlevel
ofqualityawarenessatallproductionanddistribution
sites.Theincorporationofthenewproductionsiteat
Jiangmen,China,intotheSIMONAqualitymanagement
conceptprogressedwell,andcertificationoftheQM
systematourChinesemanufacturingplantcannowbe
plannedfortheendof2011.
Amongthefocalpointsofthequalitymanagementsys-
temin2010wereaninterdisciplinaryqualitycircle,
productauditsandseveralprocessoptimisationmeas-
04FINANCIALSTATEMENTSOF
SIMONAAG(EXCERPT)
01COMPANY
17
-
Staffandrevenue
relIABle ANd AttrACtIVe eMplOYer
Despitetheeconomicupheavalseenin2009and2010,SIMONAmaintainedkeptstaffinglevelsstable.Wedemandperformanceand
encourageinitiative.Thisisillustratedbyouraward-winningvocationaltrainingprogramme,ourclosecollaborationwithuniversitiesand
thenewlycreatedSIMONATalentPromotionCircle–„YourTalent.OurFuture.“
303,7
1.236
2008
2009
2010
1.234
215,1
267,4
Revenuein€ millions
Employeesatyears-end
1.251
18
-
uresrelatingtonewautomotiveprojects.Intheareaof
pipesandfittings,anincreasingnumberofcountry-spe-
cificproductcertificationswerenecessaryinresponse
tocustomerandmarketrequirements.Thisresultedin
severalauditsaspartofwhichwewereabletoproveto
externalauditorstheefficacyoftheSIMONAmanage-
mentsystemsaswellastheexceptionallyhighquality
ofourproductsandprocesses.
Asacompanyoperatingwithintheglobalbusiness
arena,SIMONAAGiswellawareofitsresponsibilities
towardspeopleandtheenvironment.Thus,sustainabil-
ityandenvironmentalcompatibilityformanintegralpart
ofthecorporatephilosophyembracedbySIMONAAG.
SIMONAproductscontributetotheprotectionof
resources,e.g.byreplacingheaviermaterials,byfacili-
tatingwatertreatmentorbyreducingCO2emissions.
Sustainabilityhasalsobeendefinedasastrategicgoal
withregardtoourproductionprocesses.Indeed,pro-
duction-integratedenvironmentalprotectionplaysapiv-
otalrolewhenitcomestoplanningnewproduction
processesandcoordinatingfabricationmethods.
SIMONAAGiscommittedtoimprovingitsprocesseson
acontinualbasis,withtheexpresspurposeofactingin
aresource-andenvironmentally-friendlymanner.
Compensation report
Management Board compensation
TheSupervisoryBoard,basedontherecommendations
ofthePersonnelCommittee,isresponsiblefordeter-
miningtheoverallcompensationoftherespectiveMan-
agementBoardmembers.Italsoregularlyreviewsthe
compensationsystemrelatingtotheManagement
Board.ThePersonnelCommitteeconsistsofHans-
WernerMarx,ChairmanoftheSupervisoryBoard,as
wellastheSupervisoryBoardmembersDr.RolfGößler
andRolandFrobel.Compensationforthemembersof
theManagementBoardofSIMONAAGiscalculatedon
thebasisofthesizeofthecompany,itscommercial
andfinancialposition,aswellasthelevelandstructure
ofcompensationgrantedtoManagementBoardmem-
bersofsimilarenterprises.Inaddition,thedutiesand
thecontributionoftherespectivemembersoftheMan-
agementBoardaretakenintoaccount.
ManagementBoardcompensationisperformance-
based.Itiscomprisedofafixedlevelofremuneration
aswellasavariablecomponentintheformofabonus.
Bothoftheaforementionedcomponentsareassessed
onanannualbasis.Inaddition,bothcomponentsare
subjecttothoroughanalysesinintervalsoftwotothree
years,basedonacomparisonwithcompensationfig-
uresapplicabletoexecutivestaffofsimilarenterprises.
Themostrecentassessmentwasconductedin2009.
Thefixedcomponentofcompensationispaidasasal-
aryonamonthlybasis.Inaddition,themembersofthe
ManagementBoardreceiveabonus,thelevelofwhich
isdependentonattainingspecificfinancialtargets
whicharecalculatedonthebasisofthecompany’s
earningsperformance.TotalcompensationfortheMan-
agementBoardamountedto€ 1,553thousand(prev.
year:€ 1,296thousand).Totalcompensationcomprises
€ 1,034thousand(prev.year:€ 988thousand)infixed-
levelcompensationand€ 519thousand(prev.year:
€ 308thousand)inbonuspayments.Thecompanydoes
notgrantloanstomembersoftheManagementBoard.
Therearenoshareoptionplansorothershare-based
compensationprogrammesinplaceformembersofthe
ManagementBoard.
Thecompany’sArticlesofAssociationcontainnoprovi-
sionsthatarenon-compliantwiththosesetoutinthe
GermanStockCorporationActasregardstheconditions
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02GROUPFINANCIALSTATEMENTS 04FINANCIALSTATEMENTSOF
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01COMPANY
19
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applicabletotheappointmentorremovalofManage-
mentBoardmembersaswellasamendmentstothe
company’sArticlesofAssociation.Inviewofthis,readers
areaskedtorefertotherelevantstatutoryprovisionsset
outinSections84,85,133and179oftheGerman
StockCorporationAct(Aktiengesetz–AktG)forfurther
details.
RemunerationfortheformermembersoftheManage-
mentBoardamountedto€ 592thousand(previous
year:€ 853thousand).Pensionprovisionsforactive
andformermembersoftheManagementBoardwere
recognisedtothefullextentandamountedto€ 7,756
thousandasat31December2010(previousyear:
€ 8,507thousand).
Supervisory Board compensation
SupervisoryBoardcompensationiscalculatedaccord-
ingtothesizeofthecompany,aswellasthedutiesand
responsibilitiesoftheSupervisoryBoardmembers.The
ChairmanandtheDeputyChairmanaswellasmembers
involvedinCommitteesreceivesupplementarycom-
pensation.
MembersoftheSupervisoryBoardreceiveastandard
fixedlevelofcompensationamountingto€ 10,000.The
ChairmanoftheSupervisoryBoardreceivesanamount
equivalenttodoublethestandardlevelofcompensa-
tion;theDeputyChairmanreceivesanamountequival-
enttooneandahalftimesthestandardlevelofcom-
pensation.SupervisoryBoardmemberswhoare
engagedinCommitteeworkreceivesupplementary
compensationof€ 5,000.Allexpensesassociated
directlywithapositionontheSupervisoryBoard,as
wellassalestax,arereimbursed.
Inadditiontofixedcompensation,theGeneralMeeting
shallbeauthorisedtopassaresolutiononavariable
componentofcompensation,paymentofwhichshallbe
dependentonwhetherspecificcorporateperformance
indicatorshavebeenmetorexceeded.AttheAnnual
GeneralMeetingofShareholderson25June2010no
suchresolutionforvariablecompensationcomponents
waspassedforthe2010financialyear.
SupervisoryBoardcompensationfor2010amountedto
€ 121thousand(previousyear:€ 121thousand).The
companydoesnotgrantloanstomembersofthe
SupervisoryBoard.Therearenoshareoptionplansor
othershare-basedcompensationprogrammesinplace
formembersoftheSupervisoryBoard.
disclosures pursuant to Sections 289 (4) and 315 (4)
HGB and explanatory report
Asat31December2010,thesharecapitalofSIMONA
AGwas€ 15,500,000,dividedinto600,000no-par-value
bearershares(“Stückaktien”governedbyGermanlaw).
Thus,itremainedunchangedinthe2010financialyear.
ThesharesaretradedintheGeneralStandardofthe
GermanstockexchangeinFrankfurtaswellasonthe
Berlinsecuritiesexchange.Therearenodifferentcate-
goriesofshareorsharesfurnishedwithspecialrights.
EachshareisequippedwithonevoteattheGeneral
MeetingofShareholders.Inviewofthefactthata
shareholder’srighttoacertificateofownershipinter-
estshasbeenprecludedunderthecompany’sArticles
ofAssociation,thesharecapitalofourcompanyisrep-
resentedonlyintheformofaglobalcertificate,which
hasbeendepositedwithClearstreamBankingAG,
FrankfurtamMain.Therefore,ourshareholdersonly
haveaninterestasco-ownersinthecollectiveholdings
oftheno-par-valuesharesinourcompany,asheldby
ClearstreamBankingAG,accordingtotheirinterestin
thecompany’ssharecapital.Weshallnolongerissue
effectivesharecertificates.AsfarastheManagement
Boardisaware,therearenorestrictionsaffectingvoting
rightsorthetransferofshares.
A30.79percentinterestwasheldbyDr.Wolfgangund
AnitaBürkleStiftung(Kirn),an11.64percentinterest
byDirkMöller(Kirn),an11.41percentinterestby
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20
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RegineTegtmeyer(Seelze),a15.0percentinterestby
KreissparkasseBiberach(Biberach),a10.0percent
interestbySIMONAVermögensverwaltungsgesellschaft
derBelegschaftmbH(Kirn)anda10.1percentinterest
byRossmannBeteiligungsGmbH(Burgwedel).The
remaining11.06percentofsharesinthecompany
wereinfreefloat.On10June2010,Dr.Wolfgangund
AnitaBürkleStiftungnotifiedthecompanyinaccord-
ancewithSection21(1)oftheGermanSecuritiesTrad-
ingAct(Wertpapierhandelsgesetz–WpHG)thatits
votingpowerinrespectofSIMONAAGhadexceeded
thethresholdof15percent,20percent,25percent
and30percentofthevotingrightson13May2010
andthatatthisdateitsinterestwas30.79percent
(correspondingto184,739votingrights).On10June
2010,Dr.WolfgangundAnitaBürkleStiftungfiledan
applicationwiththeFederalFinancialSupervisory
Authority(BundesanstaltfürFinanzdienstleistungsauf-
sicht–BaFin)forexemptionpursuanttoSection37(1)
and(2)oftheSecuritiesAcquisitionandTakeoverAct
(Wertpapiererwerb-undÜbernahmegesetz–WpÜG)in
conjunctionwithSection9sentence1no.1ofthe
WpÜGOfferOrdinance(WpÜG-Angebotsverordnung).On
thebasisofanofficialNoticeissuedbytheFederal
FinancialSupervisoryAuthorityon22July2010,Dr.
WolfgangundAnitaBürkleStiftungwasexemptedfrom
itsdutiesunderSection35(2)sentence1WpÜGtosub-
mitanofferdocumenttotheFederalFinancialSuper-
visoryAuthorityanditsdutiesunderSection35(2)sen-
tence2inconjunctionwithSection14(2)sentence1
WpÜGtopublishamandatoryoffer.Thisexemptionwas
grantedunderSection37(1)and(2)WpÜGinconjunc-
tionwithSection9sentence1no.1WpÜGOfferOrdi-
nanceinrespectofthecontrolgainedoverSIMONAAG
followingthetestamentarysuccessionof13May2010.
On22April2010,LandkreisBiberach,Biberach,Germany,
notifiedthecompanyinaccordancewithSection21(1)
WpHGthatitsvotingpowerinrespectofSIMONAAGhad
01 GrOup MANAGeMeNt repOrt
BusinessActivitiesandGeneralConditions
FinancialPerformance
FinancialAssetsandLiabilities
FinancialPosition
EventsaftertheReportingDate
RiskReport
ReportonExpectedDevelopments
OtherInformation
02GROUPFINANCIALSTATEMENTS
exceededthethresholdof3percent,5percentand10
percenton29November2006andthatatthisdateits
interestwas10.67percent(64,000votingrights).Of
thesevotingrights,10.67percent(64,000votingrights)
areattributabletotheaforementionedshareholderin
accordancewithSection22(1)sentence1no.1WpHG.
Withinthiscontext,attributablevotingrightsareheldby
theaforementionedpartyviathefollowingentityunder
itscontrolwhosevotingpowerinrespectofSIMONAAG
amountsto3percentormore:KreissparkasseBiber-
ach,Biberach,Germany.On22April2010,Landkreis
Biberach,Biberach,Germany,notifiedthecompanyin
accordancewithSection21(1)WpHGthatitsvoting
powerinrespectofSIMONAAGhadexceededthe
thresholdof15percenton2March2010andthatat
thisdateitsinterestwas15.0038percent(90,023
votingrights).
Ofthesevotingrights,15.0038percent(90,023voting
rights)areattributabletotheaforementionedshare-
holderinaccordancewithSection22(1)sentence1no.
1WpHG.Withinthiscontext,attributablevotingrights
areheldbytheaforementionedpartyviathefollowing
entityunderitscontrolwhosevotingpowerinrespectof
SIMONAAGamountsto3percentormore:Kreisspar-
kasseBiberach,Biberach,Germany.
Asat25June2010,membersoftheManagement
Boardreportedatotalholdingof70,776ownshares;
thiscorrespondsto11.8percentofthesharecapital
ofSIMONAAG.Accordingtothenotificationof25June
2010,membersoftheSupervisoryBoardheldatotalof
1,700shares.Thiscorrespondsto0.28percentof
totalsharecapital.
Totheextentthatemployeesholdaninterestinthe
company’scapital,theseemployeesthemselvesdirectly
exercisetherightsofcontrolassociatedwiththeir
shareholdings.
04FINANCIALSTATEMENTSOF
SIMONAAG(EXCERPT)
01COMPANY
21
-
GrOup MANAGeMeNt repOrt
Theappointmentandtheremovalofmembersofthe
ManagementBoardaregovernedbythestatutoryprovi-
sionssetoutinSections84and85oftheGerman
StockCorporationAct(Aktiengesetz–AktG)aswellas
bySection9oftheArticlesofAssociationofSIMONA
AG.Undertheseprovisions,theManagementBoardof
thecompanyconsistsofatleasttwomembers.The
appointmentofdeputymembersoftheManagement
Boardispermitted.TheManagementBoardgenerallyhas
achairmantobeappointedbytheSupervisoryBoard.
TheSupervisoryBoardisentitledtotransfertoaSupervi-
soryBoardcommitteethedutiesrelatingtotheconclu-
sion,amendmentandterminationofManagementBoard
employmentcontracts.AnyamendmentstotheArticles
ofAssociationmustbemadeinaccordancewiththestat-
utoryprovisionssetoutinSection179etseq.oftheGer-
manStockCorporationAct.
AccordingtoSection6oftheArticlesofAssociation,the
companyisentitledtoissuesharecertificatesthat
embodyoneshare(singlecertificate)ormultipleshares
(globalcertificates).
Atpresenttherearenosignificantagreementscontaining
achangeofcontrolprovisionthatwouldapplyinthe
eventofatakeoverbid.
Atpresenttherearenoagreementswithmembersofthe
ManagementBoardorwithemployeesrelatingtocom-
pensationpaymentsintheeventofachangeofcontrol.
Forward-looking statements and forecasts
ThisGroupmanagementreportcontainsforward-looking
statementsthatarebasedonthecurrentexpectations,
presumptionsandforecastsoftheManagementBoard
ofSIMONAAGaswellasoninformationcurrentlyavail-
abletotheManagementBoard.Theseforward-looking
statementsshallnotbeinterpretedasaguaranteethat
thefutureeventsandresultstowhichtheyreferwill
actuallymaterialise.Rather,futurecircumstancesand
resultsdependonamultitudeoffactors.Theseinclude
variousrisksandimponderabilities,aswellasbeing
basedonassumptionsthatmayconceivablyprovetobe
incorrect.SIMONAAGshallnotbeobligedtoadjustor
updatetheforward-lookingstatementsmadeinthis
report.
Closing statement
Weherebydeclarethattothebestofourknowledgethe
managementreportconveysthecourseofbusiness,the
financialperformanceandthematerialopportunities
andrisksassociatedwiththeexpecteddevelopmentof
theSIMONAGroup.
SIMONAAG
Kirn,31March2011
TheManagementBoard
22
-
GroupIncomeStatement 24
GroupStatementofComprehensiveIncome 25
GroupStatementofFinancialPosition 26
NotestoConsolidatedFinancialStatements 47
GroupStatementofCashFlows 64
GroupStatementofChangesinEquity 65
DetailsofShareholdings 66
Auditor’sReport 67
OtherInformation 68
GroupFinancialStatements
-
in€ ‘000 Notes 01/01 - 31/12/10 01/01 - 31/12/09
Revenue [7] 267,402 215,070
Otheroperatingincome [8] 7,201 7,408
Changesininventoriesoffinishedgoods 5,314 –1,833
Costofmaterials 154,420 103,686
Staffcosts [9] 55,876 55,256
Depreciationofproperty,plantandequipment,andamortisationofintangibleassets [16],[17] 12,606 14,554
Otheroperatingexpenses [11] 46,946 39,830
Incomefromequityinvestments 500 0
Interestincome [12] 498 506
Interestexpense [12] 579 690
profit before tax 10,488 7,135
Incometaxexpense [13] 3,263 2,113
profit for the period 7,225 5,022
ofwhichattributableto:
Ownersoftheparentcompany 7,198 4,988
Non-controllinginterests 27 34
earnings per share:
in€
–basic,calculatedonthebasisofprofitfortheperiodattributabletoordinaryshareholdersoftheparentcompany [14] 12.00 8.31
–diluted,calculatedonthebasisofprofitfortheperiodattributabletoordinaryshareholdersoftheparentcompany [14] 12.00 8.31
GroupIncomeStatementofSIMONAAG
GrOup FINANCIAl StAteMeNtS
24
-
in€ ‘000 01/01 - 31/12/10 01/01 - 31/12/09
profit for the period 7,225 5,022
Exchangedifferencesontranslatingforeignoperationsduringtheyear 1,040 –17
Amountrecogniseddirectlyinequity 1,040 –17
total comprehensive income 8,265 5,005
Totalcomprehensiveincomeattributableto:
Ownersoftheparentcompany 8,235 4,968
Non-controllinginterests 30 37
GroupStatementofComprehensiveIncomeofSIMONAAG
01GROUPMANAGEMENTREPORT 02 GrOup FINANCIAl StAteMeNtS
GroupIncomeStatement
GroupStatementofComprehensiveIncome
GroupStatementofFinancialPosition
NotestoConsolidatedFinancialStatements
GroupStatementofCashFlows
GroupStatementofChangesinEquity
DetailsofShareholdings
Auditor’sReport
OtherInformation
04FINANCIALSTATEMENTSOF
SIMONAAG(EXCERPT)
01COMPANY
25
-
GroupStatementofFinancialPositionofSIMONAAG
GrOup FINANCIAl StAteMeNtS
ASSetS
in€ ‘000 Notes 31/12/10 31/12/09
Intangibleassets [16] 1,294 1,412
Property,plantandequipment [17] 88,126 92,839
Financialassets [30] 23 23
Non-currenttaxassets [20] 3,773 4,320
Deferredtaxassets [13] 173 236
Non-current assets 93,389 98,830
Inventories [18] 50,515 43,994
Tradereceivables [19] 41,845 33,320
Otherassetsandprepaidexpenses [20] 9,947 6,902
Derivativefinancialinstruments [30] 0 160
Otherfinancialassets [30] 10,000 0
Cashandcashequivalents [21] 39,316 61,479
Current assets 151,623 145,855
total assets 245,012 244,685
eQuItY ANd lIABIlItIeS
in€ ‘000 Notes 31/12/10 31/12/09
equity attributable to owners of theparent company
Issuedcapital 15,500 15,500
Capitalreserves 15,274 15,274
Revenuereserves 131,425 127,755
Otherreserves –260 –1,225
161,939 157,304
Non-controlling interests 272 242
total equity [22] 162,211 157,546
Financialliabilities [23] 4,848 7,000
Provisionsforpensions [24] 38,322 36,698
Otherprovisions [26] 6,036 5,979
Otherliabilities 211 414
Deferredtaxliabilities [13] 5,654 5,271
Non-current liabilities 55,071 55,362
Financialliabilities [23] 313 3,824
Provisionsforpensions [24] 1,248 1,637
Otherprovisions [26] 2,535 5,708
Tradepayables 11,202 6,904
Incometaxliabilities 1,607 2,638
Otherliabilitiesanddeferredincome 10,670 10,771
Derivativefinancialinstruments [30] 155 295
Current liabilities 27,730 31,777
total equity and liabilities 245,012 244,685
26
-
NotestoConsolidatedFinancialStatements
[1] COMpANY INFOrMAtION
SIMONAAGisastockcorporation(Aktiengesellschaft)
foundedinGermany–registeredofficeatTeichweg16,
55606Kirn,Germany.Itssharesaretradedwithinthe
GeneralStandardoftheFrankfurtandBerlinStock
Exchanges.Theconsolidatedfinancialstatementsof
SIMONAAGforthefinancialyearended31December
2010werereleasedbytheManagementBoardonthe
basisofaresolutionpassedon31March2011forthe
purposeofforwardingthemtotheSupervisoryBoard.
TheactivitiesofSIMONAAGmainlyincludetheproduc-
tionandsaleofsemi-finishedproductsintheformof
sheets,rods,weldingrods,pipes,fittingsandfinished
partsmadeofthermoplastics.
Thesemi-finishedproductsaremanufacturedinGermany
atplantsinKirnandKirchhundem-Würdinghausen(until
30September2010),aswellasinHazleton(USA)and
Jiangmen(China).Pipesandfittingsareproducedatthe
plantinRingsheim(Germany).TheplantinLitvinov
(CzechRepublic)manufacturessemi-finishedproducts,
pipesandfittings.Theproductsaremarketedunderthe
jointSIMONAbrandaswellasarangeofseparate
brands.
SIMONAAGmaintainsasalesofficeinMöhlin,
Switzerland.
Inaddition,distributionisconductedviasubsidiariesin
theUnitedKingdom(SIMONAUKLimited,Stafford,
UnitedKingdom),France(SIMONAS.A.,Domont,France),
Italy(SIMONAS.r.l.,Vimodrone,Italy),Spain(SIMONA
IBERICASEMIELABORADOSS.L.,Barcelona,Spain),
Poland(SIMONAPOLSKASp.zo.o.,Wrocław,Poland,
DEHOPLASTPOLSKASp.zo.o.,Kwdizyn,Poland),the
CzechRepublic(SIMONAPLASTICSCZ,s.r.o.,Prague,
CzechRepublic),HongKong(SIMONAFAREASTLtd.,
HongKong,China),China(SIMONAENGINEERINGPLAS-
TICSTRADINGCo.Ltd,Shanghai,China)andtheUnited
States(SIMONAAMERICAInc.,Hazleton,USA).
[2] ACCOuNtING pOlICIeS
Basis of preparation
Theconsolidatedfinancialstatementsareprepared
usingthehistoricalcostprinciple,withtheexceptionof
derivativefinancialinstrumentsandavailable-for-sale
financialassets,whicharemeasuredatfairvalue.The
consolidatedfinancialstatementsarepreparedineuro.
Unlessotherwisestated,allamountsareroundedto
€ ‘000.
Statement of compliance with IFrS
TheconsolidatedfinancialstatementsofSIMONAAG
andtheentitiesincludedintheconsolidatedgroupfor
theperiodended31December2010,havebeenpre-
paredinaccordancewiththeInternationalFinancial
ReportingStandards(IFRS)applicableatthereporting
date,asadoptedbytheEuropeanUnion,andtheprovi-
sionsofcommerciallawtobeappliedadditionallypur-
suanttoSection315a(1)oftheGermanCommercial
Code(Handelsgesetzbuch–HGB).
Theterm“IFRS”comprisesallInternationalFinancial
ReportingStandards(IFRS)andInternationalAccounting
Standards(IAS)tobeappliedonamandatorybasisas
atthereportingdate.Additionally,allinterpretations
issuedbytheInternationalFinancialReportingInterpre-
tationsCommittee(IFRIC)–formerlyStandingInterpre-
tationsCommittee(SIC)–wereappliedinsofarastheir
applicationwasmandatoryforthe2010financialyear.
Theconsolidatedfinancialstatementsconsistofthe
financialstatementsofSIMONAAGanditssubsidiaries
asat31Decemberofeachfinancialyear(hereinafter
alsoreferredtoas“Group”or“SIMONAGroup”).
TheGroupstatementoffinancialpositionconformswith
thepresentationrequirementsofIAS1.Variousitems
reportedintheincomestatementandthestatementof
financialpositionhavebeenaggregatedforthepurpose
ofimprovingtheoverallclarityofpresentation.These
01GROUPMANAGEMENTREPORT 02 GrOup FINANCIAl StAteMeNtS
GroupIncomeStatement
GroupStatementofComprehensiveIncome
GroupStatementofFinancialPosition
NotestoConsolidatedFinancialStatements
GroupStatementofCashFlows
GroupStatementofChangesinEquity
DetailsofShareholdings
Auditor’sReport
OtherInformation
04FINANCIALSTATEMENTSOF
SIMONAAG(EXCERPT)
01COMPANY
27
-
itemsaredisclosedanddiscussedseparatelyinthe
notestotheconsolidatedfinancialstatements.
principles of consolidation
Theconsolidatedfinancialstatementscomprisethe
accountsofSIMONAAGanditssubsidiariesforeach
financialyearended31December.Thefinancialstate-
mentsofSIMONAAGandthesubsidiariesareprepared
usinguniformaccountingpoliciesforthesamereporting
period.
Allintragroupbalances(receivables,liabilities,provi-
sions),transactions,incomeandexpensesaswellas
profitsandlossesfromtransactionsbetweenconsoli-
datedentities(“intercompanyprofits”)areeliminatedas
partofconsolidation.
Subsidiariesarefullyconsolidatedeffectivefromthe
acquisitiondate,whichisthedateonwhichtheGroup
effectivelyobtainscontrol.Inclusionintheconsolidated
financialstatementsendsassoonastheparentceases
tocontrolthesubsidiary.Changesinaparent’sowner-
shipinterestinasubsidiarythatdonotresultinaloss
ofcontrolareaccountedforasequitytransactions.
Non-controllinginterestsaredisclosedseparatelyinthe
GroupincomestatementandwithinequityoftheGroup
statementoffinancialposition.
[3] NeW FINANCIAl repOrtING StANdArdS
3.1 Accounting standards applicable for the first time
in the financial year
Theaccountingmethodsappliedtotheseconsolidated
financialstatementsareconsistentwiththoseapplied
inthepreviousyear,withtheexceptionofthefollowing
newandamendedStandardsandInterpretationseffec-
tiveasat1January2010.Thefollowingsectionpro-
videsasummaryofStandardsthatareofrelevanceto
SIMONAAG,aswellasdetailingthepossibleimplica-
tionsfortheconsolidatedfinancialstatements:
� IAS39“FinancialInstruments:Recognitionand
Measurement”(EligibleHedgedItems)
� IFRS2“Share-basedPayment”(GroupCash-settled
Share-basedPaymentTransactions)
� IFRS3“BusinessCombinations”/IAS27“Consoli-
datedandSeparateFinancialStatements”(PhaseII:
generalrevisionaspartoftheconvergenceproject
oftheIASBandFASB
� IFRIC17DistributionsofNon-cashAssetstoOwners
(newinterpretation)
� ImprovementstoIFRS2008
� ImprovementstoIFRS2009
Thefollowingsectionprovidesasummaryoftherelev-
antStandards,aswellasdetailingthepossibleimpli-
cationsfortheconsolidatedfinancialstatements:
� IAS39“FinancialInstruments:Recognitionand
Measurement”(EligibleHedgedItems)clarifiesthat
anentityisentitledtodesignatejustsomeofthe
changesinthecashflowsorfairvaluesofafinan-
cialinstrumentasahedgeditem.Thisalsoencom-
passesthedesignationofinflationasahedgedrisk
orportioninparticularsituations.TheSIMONA
Grouphasascertainedthatthisamendmentwillnot
affecttheGroup’sfinancialposition,financialper-
formanceandcashflows,astheGrouphasnot
enteredintoanysuchtransactions.
� IFRS2“Share-basedPayment”(GroupCash-settled
Share-basedPaymentTransactions)containsamend-
mentstothescopeandaccountingofGroupcash-
settledshare-basedpaymenttransactions).The
amendmenttoIFRS2hasnoeffectonthefinancial
position,financialperformanceandcashflowsof
theSIMONAGroup,asnoshare-basedpaymentis
offered.
� IFRS3“BusinessCombinations”/IAS27“Consoli-
datedandSeparateFinancialStatements”were
amendedextensivelyaspartoftheconvergence
GrOup FINANCIAl StAteMeNtS
28
-
projectimplementedbytheIASBandFASB.Thekey
amendmentsarecentredaroundtheintroductionof
anoptionrelatingtothemeasurementofnon-con-
trollinginterests,withachoicebetweenrecognition
onthebasisoftheproportionateidentifiablenet
assets (purchased Goodwill Method)andtheso-
calledFull Goodwill Method,wherebytheentirepor-
tionofgoodwillapplicabletotheminorityshare-
holdershallberecognised.Otherpointsincludethe
revaluation,withrecognitioninprofitorloss,ofany
existingownershipinterestsatthedateofinitially
obtainingcontrol(businesscombinationachievedin
stages),therecognitionattheacquisitiondateof
anyconsiderationcontingentonfutureeventsas
wellastherecognitionoftransactioncostsinprofit
orloss.Thetransitionalprovisionsstipulateapro-
spectiveapplicationoftheamendments.Thereare
nochangesinrespectofassetsandliabilitiesthat
arisefrombusinesscombinationspriortotheinitial
applicationofthenewstandards.Theamendments
mayhaveaneffectonthecarryingamountofgood-
will,ontheresultsofthereportingperiodinwhicha
businesscombinationhasoccurredandonfuture
results.Inparticular,applicationofthefull-goodwill
methodmayresultinhighergoodwillbeingrecog-
nised.Theseamendmentshadnoeffectonthe
2010financialyear,asnotransactionsrelatingto
businesscombinationsoccurredintheperiodunder
review.
� IFRIC17includesdetailsonhowtoaccountfordis-
tributionsofnon-cashassetstoownerseitherfrom
reservesorintheformofdividends.ThisInterpreta-
tiondoesnoteffectthepresentationoffinancial
position,financialperformanceandcashflowsof
theSIMONAGroup,asnosuchdistributionswere
made.
3.2 Issued standards and interpretations which have
not yet been applied (eu endorsement completed)
TheInternationalAccountingStandardsBoard(IASB)and
theInternationalFinancialReportingInterpretations
Committee(IFRIC)issuedthefollowingStandardsand
Interpretationswhichhavealreadybeenadoptedbythe
EuropeanUnionaspartofthecomitologyprocedurebut
whoseapplicationwasnotyetmandatoryinthe2010
financialyear.TheGroupwillnotapplytheseStandards
andInterpretationsforanearlierperiod.
� IFRS1“First-timeAdoptionofInternationalFinancial
ReportingStandards”(LimitedExemptionfromCom-
parativeIFRS7DisclosuresforFirst-timeAdopters)
� IAS24“RelatedPartyDisclosures”
� IAS32“FinancialInstruments:Presentation”(Classi-
ficationofRightsIssues)
� IFRIC14“PrepaymentsofaMinimumFunding
Requirement”
� IFRIC19“ExtinguishingFinancialLiabilities
withEquityInstruments”
� VariousimprovementstoIFRS(omnibusstandardfor
thepurposeofamendingvariousIFRSs).
Basedonsoundjudgement,theSIMONAGroupmay
potentiallybeaffectedbythefollowingamendments:
� IAS1“PresentationofFinancialStatements”
� IAS27“ConsolidatedandSeparateFinancial
Statements”
� IFRS3“BusinessCombinations”
� IFRS7“FinancialInstruments:Disclosures”
WiththeexceptionofIAS24,applicationoftheafore-
mentionedstandardsandinterpretationsisunlikelyto
havesignificantimplicationsforthefuturefinancial
statementsissuedbytheSIMONAGroup:
IAS24(amended)wasissuedinNovember2009and
mustbeappliedbyentitiesforannualperiodsbeginning
onorafter1January2011.Itrevisesthedefinitionof
relatedpartiesinordertosimplifytheprocessofidenti-
fyingrelationshipswithrelatedparties,aswellas
01GROUPMANAGEMENTREPORT 02 GrOup FINANCIAl StAteMeNtS
GroupIncomeStatement
GroupStatementofComprehensiveIncome
GroupStatementofFinancialPosition
NotestoConsolidatedFinancialStatements
GroupStatementofCashFlows
GroupStatementofChangesinEquity
DetailsofShareholdings
Auditor’sReport
OtherInformation
04FINANCIALSTATEMENTSOF
SIMONAAG(EXCERPT)
01COMPANY
29
-
itemsaredisclosedanddiscussedseparatelyinthe
notestotheconsolidatedfinancialstatements.
principles of consolidation
Theconsolidatedfinancialstatementscomprisethe
accountsofSIMONAAGanditssubsidiariesforeach
financialyearended31December.Thefinancialstate-
mentsofSIMONAAGandthesubsidiariesareprepared
usinguniformaccountingpoliciesforthesamereporting
period.
Allintragroupbalances(receivables,liabilities,provi-
sions),transactions,incomeandexpensesaswellas
profitsandlossesfromtransactionsbetweenconsoli-
datedentities(“intercompanyprofits”)areeliminatedas
partofconsolidation.
Subsidiariesarefullyconsolidatedeffectivefromthe
acquisitiondate,whichisthedateonwhichtheGroup
effectivelyobtainscontrol.Inclusionintheconsolidated
financialstatementsendsassoonastheparentceases
tocontrolthesubsidiary.Changesinaparent’sowner-
shipinterestinasubsidiarythatdonotresultinaloss
ofcontrolareaccountedforasequitytransactions.
Non-controllinginterestsaredisclosedseparatelyinthe
GroupincomestatementandwithinequityoftheGroup
statementoffinancialposition.
[3] NeW FINANCIAl repOrtING StANdArdS
3.1 Accounting standards applicable for the first time
in the financial year
Theaccountingmethodsappliedtotheseconsolidated
financialstatementsareconsistentwiththoseapplied
inthepreviousyear,withtheexceptionofthefollowing
newandamendedStandardsandInterpretationseffec-
tiveasat1January2010.Thefollowingsectionpro-
videsasummaryofStandardsthatareofrelevanceto
SIMONAAG,aswellasdetailingthepossibleimplica-
tionsfortheconsolidatedfinancialstatements:
� IAS39“FinancialInstruments:Recognitionand
Measurement”(EligibleHedgedItems)
� IFRS2“Share-basedPayment”(GroupCash-settled
Share-basedPaymentTransactions)
� IFRS3“BusinessCombinations”/IAS27“Consoli-
datedandSeparateFinancialStatements”(PhaseII:
generalrevisionaspartoftheconvergenceproject
oftheIASBandFASB
� IFRIC17DistributionsofNon-cashAssetstoOwners
(newinterpretation)
� ImprovementstoIFRS2008
� ImprovementstoIFRS2009
Thefollowingsectionprovidesasummaryoftherelev-
antStandards,aswellasdetailingthepossibleimpli-
cationsfortheconsolidatedfinancialstatements:
� IAS39“FinancialInstruments:Recognitionand
Measurement”(EligibleHedgedItems)clarifiesthat
anentityisentitledtodesignatejustsomeofthe
changesinthecashflowsorfairvaluesofafinan-
cialinstrumentasahedgeditem.Thisalsoencom-
passesthedesignationofinflationasahedgedrisk
orportioninparticularsituations.TheSIMONA
Grouphasascertainedthatthisamendmentwillnot
affecttheGroup’sfinancialposition,financialper-
formanceandcashflows,astheGrouphasnot
enteredintoanysuchtransactions.
� IFRS2“Share-basedPayment”(GroupCash-settled
Share-basedPaymentTransactions)containsamend-
mentstothescopeandaccountingofGroupcash-
settledshare-basedpaymenttransactions).The
amendmenttoIFRS2hasnoeffectonthefinancial
position,financialperformanceandcashflowsof
theSIMONAGroup,asnoshare-basedpaymentis
offered.
� IFRS3“BusinessCombinations”/IAS27“Consoli-
datedandSeparateFinancialStatements”were
amendedextensivelyaspartoftheconvergence
GrOup FINANCIAl StAteMeNtS
30
-
projectimplementedbytheIASBandFASB.Thekey
amendmentsarecentredaroundtheintroductionof
anoptionrelatingtothemeasurementofnon-con-
trollinginterests,withachoicebetweenrecognition
onthebasisoftheproportionateidentifiablenet
assets (purchased Goodwill Method)andtheso-
calledFull Goodwill Method,wherebytheentirepor-
tionofgoodwillapplicabletotheminorityshare-
holdershallberecognised.Otherpointsincludethe
revaluation,withrecognitioninprofitorloss,ofany
existingownershipinterestsatthedateofinitially
obtainingcontrol(businesscombinationachievedin
stages),therecognitionattheacquisitiondateof
anyconsiderationcontingentonfutureeventsas
wellastherecognitionoftransactioncostsinprofit
orloss.Thetransitionalprovisionsstipulateapro-
spectiveapplicationoftheamendments.Thereare
nochangesinrespectofassetsandliabilitiesthat
arisefrombusinesscombinationspriortotheinitial
applicationofthenewstandards.Theamendments
mayhaveaneffectonthecarryingamountofgood-
will,ontheresultsofthereportingperiodinwhicha
businesscombinationhasoccurredandonfuture
results.Inparticular,applicationofthefull-goodwill
methodmayresultinhighergoodwillbeingrecog-
nised.Theseamendmentshadnoeffectonthe
2010financialyear,asnotransactionsrelatingto
businesscombinationsoccurredintheperiodunder
review.
� IFRIC17includesdetailsonhowtoaccountfordis-
tributionsofnon-cashassetstoownerseitherfrom
reservesorintheformofdividends.ThisInterpreta-
tiondoesnoteffectthepresentationoffinancial
position,financialperformanceandcashflowsof
theSIMONAGroup,asnosuchdistributionswere
made.
3.2 Issued standards and interpretations which have
not yet been applied (eu endorsement completed)
TheInternationalAccountingStandardsBoard(IASB)and
theInternationalFinancialReportingInterpretations
Committee(IFRIC)issuedthefollowingStandardsand
Interpretationswhichhavealreadybeenadoptedbythe
EuropeanUnionaspartofthecomitologyprocedurebut
whoseapplicationwasnotyetmandatoryinthe2010
financialyear.TheGroupwillnotapplytheseStandards
andInterpretationsforanearlierperiod.
� IFRS1“First-timeAdoptionofInternationalFinancial
ReportingStandards”(LimitedExemptionfromCom-
parativeIFRS7DisclosuresforFirst-timeAdopters)
� IAS24“RelatedPartyDisclosures”
� IAS32“FinancialInstruments:Presentation”(Classi-
ficationofRightsIssues)
� IFRIC14“PrepaymentsofaMinimumFunding
Requirement”
� IFRIC19“ExtinguishingFinancialLiabilities
withEquityInstruments”
� VariousimprovementstoIFRS(omnibusstandardfor
thepurposeofamendingvariousIFRSs).
Basedonsoundjudgement,theSIMONAGroupmay
potentiallybeaffectedbythefollowingamendments:
� IAS1“PresentationofFinancialStatements”
� IAS27“ConsolidatedandSeparateFinancial
Statements”
� IFRS3“BusinessCombinations”
� IFRS7“FinancialInstruments:Disclosures”
WiththeexceptionofIAS24,applicationoftheafore-
mentionedstandardsandinterpretationsisunlikelyto
havesignificantimplicationsforthefuturefinancial
statementsissuedbytheSIMONAGroup:
IAS24(amended)wasissuedinNovember2009and
mustbeappliedbyentitiesforannualperiodsbeginning
onorafter1January2011.Itrevisesthedefinitionof
relatedpartiesinordertosimplifytheprocessofidenti-
fyingrelationshipswithrelatedparties,aswellas
01GROUPMANAGEMENTREPORT 02 GrOup FINANCIAl StAteMeNtS
GroupIncomeStatement
GroupStatementofComprehensiveIncome
GroupStatementofFinancialPosition
NotestoConsolidatedFinancialStatements
GroupStatementofCashFlows
GroupStatementofChangesinEquity
DetailsofShareholdings
Auditor’sReport
OtherInformation
04FINANCIALSTATEMENTSOF
SIMONAAG(EXCERPT)
01COMPANY
31
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exemptingareportingentityfromitsdisclosurerequire-
mentsinrelationtorelatedpartytransactionswitha
governmentthathascontrol,jointcontrolorsignificant
influenceoverthereportingentityandanotherentity
thatisarelatedpartybecausethesamegovernment
hascontrol,jointcontrolorsignificantinfluenceover
boththereportingentityandtheotherentity.TheStand-
ardistobeappliedretrospectively.Inviewofthe
extendeddefinitionsetoutintheamendment,itislikely
thatadditionaldisclosuresrelatingtothecircleof
relatedpartiesoftheGroupwillberequired.Thedetails
ofapplicationofthisreviseddefinitionarecurrently
beingassessed.However,theamendmentwillhaveno
implicationsfortherecognitionandmeasurementof
assetsandliabilitiesintheconsolidatedfinancialstate-
mentsandfortheresultsinthefuturefinancialyears.
3.3 Issued standards and interpretations which have
not yet been applied (eu endorsement pending)
TheIASBandIFRICissuedthefollowingStandardsand
Interpretationsthatwerenotyetapplicableinthe2010
financialyear.TheseStandardsandInterpretationshave
yettobeadoptedbytheEuropeanUnionandarethere-
forenotappliedbytheGroup.
� IAS12“IncomeTaxes”(DeferredTax:Recoveryof
UnderlyingAssets)
� IFRS1“First-timeAdoptionofInternationalFinancial
ReportingStandards”(SevereHyperinflationand
RemovalofFixedDatesforFirst-timeAdopters)
� IFRS7“FinancialInstruments:Disclosures”
(IFRSDisclosures—TransfersofFinancialAssets)
� IFRS9“FinancialInstruments:Classificationand
Measurement”(newStandard).
TheimplicationsoftheaforementionedStandardsand
Interpretationswithregardtothefinancialposition,
financialperformanceandcashflowsoftheGroupare
currentlybeinganalysed.However,theGroupdoesnot
anticipatethatitsfinancialposition,financialperform-
anceandcashflowswillbeaffectedbytheapplication
ofsaidamendments.
[4] MAterIAl JudGeMeNtS ANd eStIMAteS
Judgements
Whenapplyingtheaccountingpolicies,themanagement
madethefollowingjudgementswiththemostsignificant
effectontheamountsrecognisedinthefinancialstate-
ments.Withinthiscontext,decisionscontainingesti-
mateshavenotbeentakenintoaccount.Amongother
aspects,significantestimatesrelatetotheusefullives
ofassets.
Materialjudgementsrelatetotheclassificationof
leases,therecognitionofprovisions,theestimationor
assessmentoftherecoverabilityorpossibleimpairment
oftradereceivables,inventoriesanddeferredtax
assets,aswellasassessmentoffactorsthatmayindi-
cateanimpairmentofassets.
uncertainties relating to estimates
Thefollowingsectionoutlinesthemostimportantfor-
ward-lookingassumptionsaswellasothermaterial
uncertaintyregardingtheuseofestimates,applicable
atthereportingdate,asaresultofwhichthereisasig-
nificantriskthatthecarryingamountsofassetsandlia-
bilitiesmayrequirematerialadjustmentswithinthe
comingfinancialyear.
Impairment of goodwill
TheGroupperformsimpairmenttestsforgoodwillat
leastonceperyear.Thisrequiresestimatestobemade
withregardtothevalueinuseofcash-generatingunits
towhichgoodwillisallocated.Forthepurposeofesti-
matingthevalueinuse,theGrouphastodetermine,on
thebasisofestimates,theprojectedcashflowsassoci-
atedwiththecash-generatingunit,aswellasselecting
anappropriatediscountrateinordertodeterminethe
GrOup FINANCIAl StAteMeNtS
32
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01GROUPMANAGEMENTREPORT 02 GrOup FINANCIAl StAteMeNtS
GroupIncomeStatement
GroupStatementofComprehensiveIncome
GroupStatementofFinancialPosition
NotestoConsolidatedFinancialStatements
GroupStatementofCashFlows
GroupStatementofChangesinEquity
DetailsofShareholdings
Auditor’sReport
OtherInformation
presentvalueoftheaforementionedcashflows.Asat
31December2010,thecarryingamountofgoodwill
was€ 143thousand(prev.year:€ 143thousand).
deferred tax assets
Deferredtaxassetsarerecognisedforthecarryforward
ofunusedtaxlossestotheextentthatitisprobable
thatfuturetaxableprofitwillbeavailableagainstwhich
theunusedtaxlossescanbeutilised.Theprocessof
determiningthelevelofdeferredtaxassetsrequires
significantjudgementbythemanagementwithregardto
thetimingandamountoffuturetaxableprofitaswellas
thefuturetaxplanningstrategies.Forfurtherdetails,
pleaserefertoNote[13].
provisions
Provisionsarerecognisedinaccordancewiththe
accountingpoliciesdiscussedinNote[26].Indetermin-
ingthelevelofprovisions,themanagementisrequired
tomakesignificantjudgementsastothetimingandthe
amountsoffutureoutflowofresources.
pensions
Expensesrelatingtodefinedbenefitplansaredeter-
minedonthebasisofactuarialmethods.Actuarialvalu-
ationisconductedonthebasisofassumptionsin
respectofdiscountrates,futuresalaryincreases,mor-
talityandfuturepensionincreases.Inviewofthelong-
termorientationofsuchplans,theseestimatesare
associatedwithsignificantuncertainty.Forfurther
details,pleaserefertoNote[24].
[5] SuMMArY OF SIGNIFICANt ACCOuNtING
pOlICIeS
Business combinations
a)Businesscombinationsasfrom1January2010
Businesscombinationsareaccountedforbyapplying
theacquisitionmethod.Thecostofabusinesscombi-
nationiscalculatedasthesumoftheconsideration
transferred,measuredattheacquisition-datefairvalue,
andanynon-controllinginterestintheacquiree.Inthe
caseofeachbusinesscombination,theacquirermeas-
urescomponentsofnon-controllinginterestseitherat
fairvalueorattheproportionateshareintherecog-
nisedamountsoftheacquiree’sidentifiablenetassets.
Acquisition-relatedcostsareac