FOR A SAFER WORLD
Document Sample
ANNUAL REPORT 2 0 0 3
FOR A SAFER WORLD
Contents
1 Highlights of 2003
Annual General Financial
2 Gunnebo – a presentation
3 Business idea, goals and strategy Meeting information
4 Comments by the CEO
The Annual General Meeting will be held Interim report January-March
6 Gunnebo’s shares at 5.00 p.m. on Monday, 29 March 2004 29 April 2004
8 The security market at Chalmers Student Union’s union build-
ing, Chalmersplatsen 1, Göteborg. Interim report January-June
10 Report of the directors
10 August 2004
12 Review of the Group Notification
14 Five-year review Shareholders who wish to participate in the Interim report January-September
Annual General Meeting must have their 28 October 2004
16 Financial risk management and names entered in the register of sharehold-
sensitivity analysis ers maintained by VPC AB by no later Year-end release 2004
than 19 March, and notify the company by 3 February 2005
18 Gunnebo Physical Security
no later than noon on 23 March.
22 Gunnebo Integrated Security Shareholders whose shares are registered in These financial reports, which are pub-
26 Gunnebo Perimeter Security nominee names must, if they wish to exer- lished in both Swedish and English, will be
cise their right to vote at the Meeting, have available on or may be ordered from the
31 Gunnebo Steelage their shares temporarily re-registered in following:
33 Gunnebo Asia Pacific their own names by 19 March.
www.gunnebo.se
34 Gunnebo Engineering
Dividend info@gunnebo.se
36 Gunnebo’s employees The Board proposes to the Annual General +46 31 83 68 00 (tel)
37 Gunnebo and the Environment Meeting that a dividend of SEK 4.50 per +46 31 83 68 10 (fax)
share be paid for 2003 and that the date of Gunnebo AB, Box 5181, 402 26
39 Consolidated income statement record for entitlement to dividend be 1 Göteborg, Sweden.
40 Consolidated balance sheet April. It is expected that the dividend will
be distributed by VPC on 6 April 2004.
Contents
42 Consolidated cash flow analysis
43 Parent company income statement Share split
44 Parent company balance sheet The Board is proposing that the company’s
shares be split, whereby shareholders will
46 Parent company cash flow analysis receive two new shares for each one they
47 Accounting principles own.
49 Notes and supplementary information
55 Proposed treatment of
unappropriated earnings
55 Report of the auditors Gunnebo in brief
56 Board and auditors
57 Management Sales by market Operating profit by division
Total sales: MSEK 6,961 (before depreciation of goodwill)
58 Gunnebo worldwide
Total: MSEK 466
s France, 26% s Gunnebo
s Great Britain, 10% Physical Security, 40%
s Sweden, 10% s Gunnebo
s Germany, 10% Integrated Security, 36%
s Benelux, 7% s Gunnebo Engineering, 17%
s Asia Pacific, 7% s Gunnebo
s Spain, 6% Perimeter Security, 6%
s North America, 5% s Gunnebo Steelage, 1%
s Other, 19%
Sales by division No of employees by division
Total sales: MSEK 6,961 Number of employees: 8 100
s Gunnebo s Gunnebo
Physical Security, 37% Physical Security, 33%
s Gunnebo s Gunnebo
Integrated Security, 30% Integrated Security, 30%
s Gunnebo Engineering, 16% s Gunnebo Engineering, 14%
s Gunnebo s Gunnebo Steelage, 14%
Perimeter Security, 15% s Gunnebo
s Gunnebo Steelage, 2% Perimeter Security, 9%
Highlights of 2003
• After another year of consolidation concentrating on improving margins and cash flow,
the Group is now financially strong and ready for further expansion.
• The profit after financial items increased by 22 per cent to MSEK 341 (280).
• Gunnebo Security raised its operating profit before depreciation of goodwill by 11 per
cent to MSEK 428 (385) and improved its operating margin to 7.4 per cent (6.6).
Strong marginal improvements for both Gunnebo Integrated Security and Gunnebo
Physical Security.
• Gunnebo Engineering increased its operating profit before depreciation of goodwill by
7 per cent to MSEK 87 (81), and improved its operating margin to 7.6 per cent (6.9).
• The operative cash flow remained strong; excluding restructuring costs it amounted to
MSEK 500 (501).
• Net debt declined by MSEK 272 to MSEK 1,309 (1,581), and the equity ratio rose to
37 per cent (30).
• Earnings per share increased by 13 per cent to SEK 11.95 (10.55). It is proposed to
increase the dividend by12.5 per cent to SEK 4.50 per share (4.00). The Board is also
proposing a two for one share split.
Highlights of 2003
• The business outlook for 2004 as a whole is good.
Key ratios 2003 2002 2001
Invoiced sales, MSEK 6,961 6,976 6,671
Operating profit, MSEK 399 361 321
Profit after financial items, MSEK 341 280 223
Operating margin, % 5,7 5,2 4,8
Return on capital employed, % 12,1 10,4 10,1
Earnings per share after dilution, SEK 11:95 10:55 7:65
Net debt, MSEK 1,309 1,581 1,872
Operative cash flow, excluding structuring costs, MSEK 500 501 348
Equity ratio, % 37 30 27
Cash flow per share, SEK 21:30 21:15 6:65
Market capitalisation, 31 December, MSEK 3,929 2,630 2,672
P/E ratio, 31 December 15 12 16
Number of employees at year-end 8,108 8,351 8,399
1 Gunnebo Annual Report 2003
Gunnebo – a presentation
Gunnebo conducts its business through four security Gunnebo Engineering is a market leader in lifting and
divisions, organised within Gunnebo Security, and fastening equipment and systems.
through Gunnebo Engineering. Gunnebo has an annual turnover of some MSEK
Gunnebo Security comprises Gunnebo Physical 7,000 and some 8,100 employees in 110 companies
Security, the world leader in high-graded burglar- and located in 32 countries.
fire-resistant safes; Gunnebo Integrated Security, Gunnebo also sells to a further 100 or more markets
which has a very strong position on the market for via agents and distributors. Since 1997, Gunnebo has
electronic security systems in Southern Europe and a more than doubled its turnover by means of organic
global position in entrance control systems; Gunnebo growth and via acquisitions. During the same period,
Perimeter Security, the leading company in Northern the security-related business has expanded from 46
Europe in outdoor and indoor perimeter protection; per cent of total sales to 84 per cent, and the foreign
and Gunnebo Asia Pacific, a newly formed division that sales ratio from 61 to 90 per cent of the total.
was created on 1 January 2004 for security activities in
Asia. This division has a very strong market position in
India and Indonesia.
Organisation of the Group
GUNNEBO
Gunnebo – a presentation
Finance
Legal affairs/M&A
Human Resources
Information and Investor Relations
Gunnebo Gunnebo Gunnebo Gunnebo Gunnebo
Physical Security Integrated Security Perimeter Security Asia Pacific Engineering
Products and services Products and services Products and services Products and services Products and services
High-graded burglar- and fire- Integrated electronic security sys- Outdoor perimeter protection High-graded burglar- and fire- Products and systems for heavy
resistant safes. Security products tems; burglar alarms, fire alarms, and entrance control such as resistant safes. Security products lifting, such as chains, hooks,
for banks: safety deposit boxes, CCTV surveillance, alarm cen- gates and fences, and alarm sys- for banks: safety deposit boxes, lifting slings and blocks. Chain-
bank vaults and vault doors. tres for alarm monitoring, tems. Products for road safety. bank vaults and vault doors, and based non-skid products.
Security products for cash han- entrance control and access con- Machine security and indoor products for banking automa- Fastening systems.
dling and transportation for trol systems. Fire extinguishing perimeter protection for industry, tion. Fire-resistant safes for com-
banks and retailers, such as auto- systems. Bullet resistant glass warehouses, public environments puter equipment. Fire extin- Brand names
matic cash handling machines, walling and partitioning. and homes. Installation and guishing equipment, fire alarms, Gunnebo Lifting, Gunnebo
service boxes, deposit boxes and Installation and service. service. alarm centres. Security booths, Fastening, Gunnebo Johnson,
transit safes. Fire-resistant safes entrance control systems, CCTV Gemla Mekanik, OFA, ANJA,
for the storage of documents and Brand names Brand names and surveillance. Installation and Tellefsdal
data media in offices. Installation Fichet-Bauche, Ritzenthaler, Gunnebo Protection, Wego, service.
and service. Rosengrens Larm, Gunnebo Werra, Alura, Polaraidat, Troax
Entrance Control, Gunnebo Brand names
Brand names Mayor, Gunnebo Metro, Steelage, Minimax, Chubbsafes,
Chubbsafes, Fichet-Bauche, Gunnebo Italdis, Gunnebo Fichet-Bauche, Rosengrens,
Rosengrens, Garny, Leicher, Omega, Armapod, CSI Security, Gunnebo Perimeter Protection,
SecureLine Hygiaphone, SMC Gunnebo Entrance Control,
Indolok Bakti Utama
2 Gunnebo Annual Report 2003
Business idea, goals and strategy
The business and the future ucts and services of high quality. On those Financial goals
Gunnebo is active on markets with consid- markets where customers so demand, Gunnebo’s financial goals are:
erable potential for growth and development. Gunnebo can offer a complete range of • For the Group’s growth to be achieved
Thanks to its very strong, world-lead- customised security products and systems. subject to good profitability and mainte-
ing brand names, the broad network of dis- nance of a strong financial position
tributors, specialised range of services and Brand names • For the Group to earn in the long term -
the high standard of its service, Gunnebo Gunnebo has at its disposal several leading, over an economic cycle – a minimum
now occupies a strong position on the mar- global brand names, and a large number of return on capital employed of 15 per cent
kets in Europe and parts of Asia. very strong, local brands. and to have a minimum operating mar-
Gunnebo’s security business consists Their common denominator is that gin, after depreciation of goodwill, of 7
primarily of high-graded, fire- and burglar- customers shall recognise that Gunnebo’s per cent. In 2003, the Group had a
resistant safes, security products for cash brand names represent high quality and return on capital employed of 12.1 per
handling, alarm systems, fire protection functionality. All activities carried out on cent and an operating margin of 5.7 per
products, entrance and access control sys- the market shall therefore be designed to cent.
tems, CCTV, alarm centres, and outdoor strengthen the Group’s priority brand • The equity ratio shall not fall below 30
and indoor perimeter protection. names. per cent in the long term. The equity
Gunnebo Engineering’s business com- ratio at the end of 2003 was 37 per cent.
prises systems for heavy lifting and fasten-
ing, as well as non-skid products. The market
Since it was formed ten years ago, the The global security market is estimated to
Business idea, goals and strategy
“new” Gunnebo has gone through two be worth some SEK 1,000 billion and to
phases. The first phase – between 1994 and be growing at a rate of 4-7 per cent a year.
2001 – was a period of strong growth and Gunnebo intends in the future to
transformation from a traditional industrial expand both organically and by means of
conglomerate into a modern security strategic acquisitions, with the object of
group. The second phase – 2002 and 2003 continuing to grow faster than the market.
– was one of consolidation and improved Gunnebo has a very strong position on
profitability. the West European market and a leading
During this period, Gunnebo focused position on the Indonesian and Indian
on improving profitability, which involved markets in Asia.
giving priority to earning higher margins Gunnebo Security also has a strong
rather than increasing volumes on certain position on the Canadian and South
markets and in certain product areas. African markets.
Phase three, which will begin in the Gunnebo’s presence on the North
2004 financial year, will see a return to American security market is currently lim-
strong growth via acquisitions – together ited.
with investments intended to promote Gunnebo’s goal is to strengthen its
growth through modernisation of the position via acquisition on markets where
Group’s own product range. its market share is currently low. One aim,
Examples of brand names that for example, is to strengthen Gunnebo
Business idea represent a significant share of the Integrated Security’s position outside
Gunnebo’s business idea is to build an Group’s intangible fixed assets. France.
international security group with very Within Perimeter Security we also
strong brands mainly focused on a well intend to strengthen our position in
developed product concept within physical Europe by means of selective acquisitions
security as well as electronic security sys- and structural changes.
tems. Furthermore, Gunnebo shall contin-
ue to build its business upon local presence
with production, sales and service on all
Long term goal Actual outcome
important markets.
2003 2002 2001 2000 1999
Customer focus Return on capital employed, % 15 12.1 10.4 10.1 15.4 12.7
On each individual market, customers Operating margin, after
should recognise Gunnebo’s ability to satis- depreciation of goodwill, % 7 5.7 5.2 4.8 6.8 6.1
fy their current and future needs for prod- Equity ratio, % > 30 37 30 27 29 30
3 Gunnebo Annual Report 2003
Comments by the CEO
appointment, above all on account of the
structural crisis the German economy is
going through. The cost situation, in com-
bination with a weak economy, has nega-
tively affected our German subsidiaries. To
this, we may add that parts of the security
industry is still suffering from specific
problems caused by the structure of the
industry.
Outside the EU, export sales to Eastern
Europe and North Africa have been going
well. We have stepped up our canvassing of
markets served by distributors.
Progress in Asia has been very encour-
aging, especially on the Group’s main mar-
kets there, namely India and Indonesia.
The order intake saw steady growth towards
the end of the year.
The divisions
At the beginning of 2001 we established
our present organisation with four security
Comments by the CEO
divisions and one division for lifting and
fastening systems.
The reason for this move was to enable
us to focus, in each product area, on mak-
ing structural changes that would improve
profitability. These projects have for the
most part been completed, except for
Perimeter Security. The first step in the
development of the main organisation was
taken with the formation of Gunnebo Asia
Pacific Division as of January 1, 2004.
Bjarne Holmqvist, President and CEO In 2003, we successfully completed the
restructuring of Gunnebo Physical Security
and Gunnebo Integrated Security.
Gunnebo Physical Security
In 2003, Gunnebo’s business was charac- transit segment being of particular impor- Following the acquisition of Chubb Safes
terised by further consolidation of the tance. Sales in France increased by more in 2000, Gunnebo Physical Security’s pro
Group’s financial position. than 8 per cent and profitability was good. forma result has improved from a loss of
The profit after financial items incre- On other markets in Europe, such as MSEK 100 to a profit of MSEK 204. The
ased by 22 per cent to MSEK 341, and the the Nordic and Benelux countries, Great operating margin in 2003 was 7.8 per cent
operative cash flow amounted to MSEK Britain and Spain, the clear focus on and the return on operating capital 23 per
500 for the second year in a row. improving profitability instead of raising cent.
During the past two years, the opera- volumes was successful. We have made con- The three-year structuring programme
tive cash flow - after investment activities scious efforts to raise both the gross and net is now broadly finished. Relocation of pro-
and changes in working capital - has margins by being attentive to the quality of duction, closure of factories and the num-
totalled MSEK 1,000. This enabled us to the order portfolio. ber of product models reduced has both
significantly reduce the net debt and raise Organic growth was consequently weak efficiently and successfully been accom-
the Group’s equity ratio to 37 per cent. in terms of invoiced sales, and negative in plished. Parallel to this, we have sharpened
terms of the order intake in 2003. our focus on banking automation and cash
Markets Nonetheless, both the operating margin and handling products, including the launch of
In business terms, the French market devel- the operating profit rose markedly. SafePay.
oped strongly in 2003, with our deliveries Among the large markets of importance Service has now grown to 25 per cent
of products and services in the cash-in- to Gunnebo in Europe, Germany was a dis- of the division’s business.
4 Gunnebo Annual Report 2003
The restructuring of the traditional Perimeter Security intends to play a leading to consolidation and profitability improve-
safe business and increased concentration role in this process. ments; now a period of renewed growth is
on cash handling and service are important about to begin.
strategic changes in the character of the Gunnebo Steelage In Europe we hope to be able to make
division’s business that will improve prof- – Gunnebo Asia Pacific a number of acquisitions to strengthen
itability. Gunnebo Steelage became a member of the Gunnebo Perimeter Security.
Gunnebo Physical Security is now one new Gunnebo Asia Pacific division on 1 Gunnebo Physical Security will expand
of the world’s leading security companies. January 2004. in Europe, and later on in the USA, while
It is based on a stable foundation and has In 2003, Gunnebo Steelage noted a Gunnebo Integrated Security will have to
good potential for further expansion within modest improvement in its operating establish a stronger presence outside of its
and outside of Europe. result, which amounted to MSEK 6. The existing markets in the south of Europe.
operating margin was 5.4 per cent, and the Market prospects for 2004 is good.
Gunnebo Integrated Security return on operating capital 7 per cent. The result is stable, the balance sheet
A marked improvement in the result, espe- Gunnebo Steelage’s Physical Security strong and cash balances healthy. The
cially in France, is reflected in a 28 per business area had a good year and its oper- transformation of Gunnebo from an indus-
cent increase in operating profit to MSEK ating margin was 10 per cent, whereas trial conglomerate into a modern interna-
183. The operating margin improved Minimax and Security Projects both tional security group is moving into its
sharply to 8.6 per cent, and the return on incurred losses. final phase. Parallel to this, Gunnebo
operating capital was 29 per cent. The enlargement and modernisation of Engineering is still developing well.
Three business units were particularly the safe factory in Halol has been completed. We intend to demonstrate to our
successful: Fichet Sécurité Electronique, shareholders, employees and partners over
Ritzenthaler and Gunnebo Entrance Gunnebo Engineering the coming years that an investment in
Comments by the CEO
Control. Dedicated work, both internal Despite another relatively weak year for the Gunnebo will produce results in both the
and external, has enabled these business economy, the division improved its opera- short and the long term.
areas to achieve profitability levels that are ting profit to MSEK 87. The operating We have very strong global brand
very good for the sector. margin was 7.6 per cent and the return on names and an extensive local presence on
The introduction of new products and operating capital 12 per cent. all the important markets around the
system solutions has sharpened Gunnebo Gunnebo Lifting is still doing very world. Together with the well established
Integrated Security’s profile as a leading well, while Gunnebo Blocks’ result service business, this means we are in par-
supplier of electronic security solutions on declined owing to the weak economic con- ticularly good shape to move into the
the division’s main markets. ditions in the USA and the depreciation of growth phase we have planned for the cur-
The business in Indonesia, which has the dollar. Gunnebo Fastening earned a rela- rent year. 2004 will be an important year
now been transferred to the division tively satisfactory result, given the low level in our growth strategy.
Gunnebo Asia Pacific, has made further of building activity.
sound progress. Despite this, the division is earning a Göteborg, February 2004
healthy operating profit and its operative
Gunnebo Perimeter Security cash flow was both high and stable.
The operating result declined further to a
weak MSEK 28. The change of manage- Summary and outlook for 2004
ment and the new action programmes have The most important divisions for the
not yet shown through in the result. The Gunnebo Group in terms of size and prof-
operating margin was 2.7 per cent and the itability - Gunnebo Physical Security and Bjarne Holmqvist
return on operating capital only 6 per cent. Gunnebo Integrated Security - are still
Both Gunnebo Perimeter Protection developing strongly in their respective
and Gunnebo Troax saw their operating business areas and markets.
results decline sharply on markets subject Gunnebo is now financially very strong
to fierce competition, especially in and is ready to move into a more intensive
Germany and England. acquisition phase, which will generate
Excess capacity, narrower margins and faster growth.
high marketing overheads, were among the The “new” Gunnebo’s almost decade-
factors behind the weaker profitability. long history may best be summarised in
To restore income levels to those of the strategic changes that have been made.
two or three years ago, the industry, in Between 1995 and 2001, the company was
Gunnebo’s view, is facing a necessary transformed into an expanding security
process of consolidation. Gunnebo group. In 2002 and 2003, the focus shifted
5 Gunnebo Annual Report 2003
Gunnebo’s shares
Gunnebo’s share price Januari 1999 - february 2004 Earnings per share
after dilution
Gunnebo Affärsvärldens General Index Turnover (no. of shares in thousand)
200 SEK
(c) SIX 12
180
10
160
8
140
6
120
4
5,000
100 2
0
4,000
99 00 01 02 03
80
s Items affecting comparability
3,000
60 2,000 Dividend per share
SEK
1,000
5
*
40 4
99 00 01 02 03 04
3
2
Share capital owned 24 per cent, and foreign sharehold- 1
Gunnebo has a share capital of MSEK 219 ers 17.2 per cent of the capital.
Gunnebo’s shares
0
that is divided into 21,889,974 shares, Vätterledens Invest AB, together with 99 00 01 02 03
each having a par value of SEK 10. All associates, is Gunnebo’s largest shareholder s Bonus
shares have equal voting rights and share with 23.4 per cent of the capital and votes. * Board proposal
equally in the company’s assets and earn- The second largest shareholder is the Stena
ings. In 2003, the number of shares in Group, together with associates, with 12.4 Equity per share
issue rose by 678,776 following the conver- per cent of the capital and votes. after dilution
sion of an outstanding convertible loan.
SEK
Share price 100
Gunnebo on the stock market The listed price of Gunnebo’s shares
80
Gunnebo’s shares have been listed on increased by 45 per cent during the year.
Stockholmsbörsen since December 1993 The stock market general index increased 60
and on its “A” list since 1996. A trading by 25 per cent over the same period, while 40
block consists of 200 shares. the Carnegie Small Cap Index rose by 42
20
per cent.
Dividend policy Since the shares were floated in 0
99 00 01 02 03
The Board’s dividend proposal shall take December 1993 the listed price has risen
into account Gunnebo’s long-term devel- by 590 per cent, while the stock market
opment potential, its financial position and has risen by 140 per cent. In 2003 the low- Cash flow per share
its investment needs. est price Gunnebo’s shares traded at was
SEK
The Board has decided that the target SEK 116.00, while the highest price was 25
for the dividend is that in the long term it SEK 188.00. The closing listed price was
20
shall amount to 30-40 per cent of the prof- SEK 179.50.
it after tax. For the current year, it proposes 15
that a dividend of SEK 4.50 per share be Turnover
10
paid, which corresponds to 38 per cent of In total 9,044,914 shares were traded in
5
the profit after tax. 2003 for a value corresponding to MSEK
1,382. The average volume traded each day 0
99 00 01 02 03
Shareholders was 36,325 shares. The turnover rate in
The number of shareholders on 31 2003 was 42 per cent, which may be com-
December 2003 was 9,500 (9,800). pared with an average of 138 per cent for
The ten largest shareholders controlled shares on the “A” list. Gunnebo’s beta value
56.2 per cent of the votes and capital. (the fluctuation in its share price in relation
Swedish institutional shareholders to the stock market index) was 0.69 in 2003.
6 Gunnebo Annual Report 2003
Information to the capital market
Data per share 2003 2002 2001
On 13 November 2003 Gunnebo
Earnings per share, SEK 12.00 10.75 7.80 arranged a capital market day at
Earnings per share after dilution, SEK 11.95 10.55 7.65 Gunnebo-Ritzenthaler’s factory in
Earnings per share after dilution, Baldenheim, France, which was attended
excluding items affecting comparability, SEK 14.95 13.45 10.40 by 29 analysts, portfolio managers and
Equity per share, SEK 85.45 77.60 71.35 journalists from Sweden, Norway,
Equity per share after dilution, SEK 88.35 79.10 73.10
Denmark, Switzerland and France.
Cash flow per share, SEK 21.30 21.15 6.65
Listed price on 31 December, SEK 179.50 124.00 126.00 Gunnebo also participated in numer-
P/E ratio 15 12 16 ous meetings with analysts in Sweden
Dividend, SEK 4.50* 4.00 3.50 and abroad, and addressed 13 meetings
Direct yield, % 2.5 3.2 2.8 of the Swedish Shareholders Association
Closing no. of shares, x 1,000 21,890 21,211 21,205 and the Association’s autumn conference
Average no. of shares, x 1,000 21,608 21,209 21,205 in Göteborg, which was attended by
No. of shares after dilution, x 1,000 21,890** 21,988** 21,988
around 1,200 people.
* Board proposal
** Excluding warrants that, in the event of dilution, would involve the issue of 1,000,000 shares at a subscription
price of SEK 152 per share.ktie Analysts who follow Gunnebo
Alfred Berg ABN AMRO
Henrik Fröjd
Largest shareholders 31 December 2003 No. +46-8-723 58 33
henrik.frojd@alfredberg.se
Vätterledens Invest AB with associates 5,126,228 23.4 %
Stena Adactum AB with associates 2,713,360 12.4 %
Handelsbanken funds 1,012,381 4.6 % Danske Equities
2nd AP Fund 723,438 3.3 % Sören Samsöe
Odin funds 605,200 2.8 % +45-3344 04 48
JP Morgan Chase Bank 526,009 2.4 % soren.samsoe@danskebank.dk
Robur funds 481,670 2.2 %
Investors Bank & Trust 470,000 2.1 %
D. Carnegie AB
Svenskt Näringsliv with associates 400,000 1.8 %
Gunnebo’s shares
Bjarne Holmqvist with associates 265,667 1.2 % Björn Enarsson
Carnegie Fond AB /Small Cap 262,000 1.2 % +46-8-676 88 00
Östersjö Foundation 245,000 1.1 % bjoena@carnegie.se
Carlsson Small Cap Fund 206,100 1.0 %
Hans Ståhlgren 190,941 0.9 % Deutsche Bank AG
Banque Carnegie Luxembourg Funds 188,600 0.9 %
Mattias Karlkjell
Other 8,473,380 38.7 %
Total 21,889,974 100.0 % +46-8-463 55 19
mattias.karlkjell@db.com
Enskilda Securities
Share holders % of share No. of % of no. of Stefan Mattsson
by size No. of shares capital shareholders shareholders
+46-8-522 297 74
stefan.mattsson@enskilda.se
00001 - 500 1,280,205 5.9 7,544 79.3
00501 - 1,000 902,105 4.1 1,066 11.2 Monika Elling
01,001 - 5,000 1,466,443 6.7 648 6.9 +46-8-522 295 44
05,001 - 10,000 680,360 3.1 90 1.0 monika.elling@enskilda.se
10,001 - 50,000 2,193,632 10.0 106 1.1
50,001 - 15,367,229 70.2 52 0.5 Hagströmer & Qviberg
Totalt 21,889,974 100.0 9,506 100.0
Fondkommission
Lars Glemstedt
+46-8-696 18 54
Change in Share Total no. of lars.glemstedt@hagqvi.com
Changes in share capital, MSEK
share capital capital shares
Handelsbanken Capital Markets
1991 Formation 4 4,000 Mikael Sens
1992 Split 100:1 4 400,000
+46-8-701 12 51
1992 New issue +96 100 10,000,000
1995 New issue +50 150 15,000,934 mise03@handelsbanken.se
1995 Conversion +3 153 15,280,783
1996 Conversion +10 163 16,275,819 Kaupthing Bank
1997 New issue +4 167 16,715,819 Henrik Alveskog
1997 Conversion +27 194 19,351,121 +46-8-791 48 69
1998 Conversion +4 198 19,813,150
henrik.alveskog@nordiska.com
1998 New issue +2 200 19,973,150
1999 Conversion 0 200 19,982,310
1999 New issue +6 206 20,625,881 Nordea Securities
2000 Conversion +6 212 21,204,528 Johan Wettergren
2002 Conversion 0 212 21,211,198 +46-8-407 92 47
2003 Conversion +7 219 21,889,974 johan.wettergren@nordeasecurities.com
Swedbank Markets
Mats Larsson
+46-8-585 925 42
mats.larsson@swedbank.com
7 Gunnebo Annual Report 2003
The security market
Over the past few decades, the The market for high-graded safes and
security market as a whole has The global other traditional banking products has a
grown some two or three per cent security market, 2003 limited growth in Europe, whilst demand in
faster than GDP on each compo- Eastern Europe, Asia and Africa is expected
nent market. to grow much faster.
One factor behind the rapid 20% Gunnebo is the market leader by a
growth is the higher rate of crime wide margin in Europe with the strong
50%
against companies, the public sec- brands Chubbsafes, Fichet-Bauche,
30%
tor and individuals; another is the Rosengrens, Garny and Leicher.
threat of new acts of terrorism and Gunnebo Physical Security has some
various kinds of natural disaster. s North America 25 per cent of the world market for high-
s Europe
The security market can therefore s Rest of the world graded, burglar- and fire-resistant safes.
be expected to show annual Gunnebo’s competitors on the
growth of 4 to 7 per cent during European market for high-graded safes are
The European
the coming five-year period, with for the most part local manufacturers, such
security market, 2003
growth in emerging markets in as Format, Bode-Panzer and Lampertz/
Asia, Africa and Latin America at Sistec in Germany, Robur and Håbeco in
the top end of this range. Scandinavia, SMP and Dudley in Great
28% Britain, Conforti in Italy and Ferrimax and
40%
The global security market is estimated to be Bausa in Spain.
worth more than 1,000 billion kronor. 32%
North America accounts for most of the High growth for integrated
The security market
market (approx. 500 billion kronor) while s Guarding services electronic security systems
s Alarm systems
Europe accounts for an estimated 300 bil- s Intrusion protection
Gunnebo Integrated Security has so far
lion. This means that North America and concentrated on the banking sector in
Europe together account for more than 80 Southern Europe, where the division is
The global security market
per cent of the total security market. market leader. Electronic security systems
per customer category for
In terms of products and services, the security for airports, ports, public institutions, casi-
safety products and service
market can be divided into three segments: nos, prisons etc. are a growing area of busi-
• Intrusion protection (physical security) ness for the division.
• Alarm systems (electronic security systems) 10% The electronic security business seg-
• Guarding services (including secure trans- ment, which includes electronic surveil-
port of cash) 25% lance systems, electronic access control sys-
65% tems, CCTV (surveillance using cameras
Within the first two segments, which are and monitors) and alarm monitoring cen-
Gunnebo’s main areas of interest, sales of tres, is expected to grow faster than the rest
s Industrial and commercial
security products and service are distrib- s Privat market of the security market.
s The public sector
uted as follows: The market for electronic security sys-
• Industrial and commercial, 65 % tems is highly fragmented in Europe, as in
• Private market, 25 % the rest of the world, despite several major
• The Public sector, 10 % boxes, and vault doors. The division also structural deals in recent years. This market
manufactures products for the secure han- is expected to grow by some 8-10 per cent
Gunnebo’s security business is focused pre- dling and transport of cash for the banking a year.
dominantly on industry, commerce and the and retail sectors, including automatic cash Gunnebo Entrance Control equips
public sector. dispenser and deposit machines, service boxes, office buildings and commercial premises,
In Europe, where Gunnebo conducts deposit boxes, transit safes, and systems for airports, ports, underground railways,
most of its business, demand breaks down secure cash handling in the retail trade. sports arenas etc. with complete entrance
as follows: intrusion protection (approx. 85 Service accounts for a growing propor- control systems, including a range of sys-
billion kronor), electronic security systems tion of the turnover. tems for visitor identification. Growth rates
(95 billion) and surveillance (120 billion). The cash handling market, especially in Europe and the USA, where Gunnebo
in the retail sector, will show marked Entrance Control has a small but fast-
GUNNEBO’S DIVISIONS growth in coming years. expanding business, are expected to remain
Physical security SafePay, Gunnebo Physical Security’s high.
Gunnebo Physical Security manufactures completely closed and secure cash handling The “bullet-resistant environment” seg-
and markets high-graded burglar- and fire- system for the retail sector, has very large ment includes systems for security booths,
resistant safes, bank vaults, safety deposit market potential. bullet-resistant windows and doors, securi-
8 Gunnebo Annual Report 2003
ty products for banks and exchange offices aim of improving its profitability in this brought together all its security-related
with built-in communication systems. segment by means of consolidation. business into a single division – Gunnebo
Growth in this segment is to some extent There is a trend on the market towards Asia Pacific – with effect from 1 January
related to increasing terrorism and armed increasingly sophisticated security solu- 2004. The division is described in more
robberies, and the consequent tightening of tions, whereby it is becoming more com- detail on page 33.
national security laws. mon to supplement conventional fencing
Gunnebo Integrated Security operates and gates with fence or ground alarms, Developments on the security
a number of alarm monitoring centres with CCTV surveillance and a variety of access market
24-hour service for banks and other insti- control systems. Terrorist attacks around the world have
tutions in France, Spain and Portugal. This Gunnebo Troax is one of Europe’s lead- taken place in new and unexpected places,
segment is believed to have considerable ing companies in indoor perimeter protection. and security has come into sharper focus as
development potential. The European market for indoor a result of intensive media coverage, regard-
The “fire protection” segment is esti- perimeter protection is estimated to be less of where in the world the acts of ter-
mated to be expanding at an annual rate of worth some three billion kronor. rorism take place.
some 5 per cent, with slight differences Troax has a market share of some 15 Despite the existence of wide geo-
between one market and another. per cent in Europe. graphical differences, the security industry
Gunnebo Integrated Security’s share of The competition mainly comes from is relatively insensitive to economic fluctua-
the total market in Europe is estimated at small, local operators that are active on tions and only marginally affected by gen-
2-3 per cent, with considerably stronger geographically confined markets. eral developments in the global economy.
The security market
positions in France, Spain, Portugal and Demand is concentrated on products
Belgium. for machine protection in the automotive Gunnebo Security: trends
There are some large competitors on and robotics industries intended to separate The main factors influencing developments
the European market, including TYCO safe from hazardous environments, and for in the security areas of interest to Gunnebo
and United Technology (Chubb Security) the security and protection of materials Security during the year are:
from the USA, Cerberus (Siemens) from handling and transport flows. The building • A marked increase in demand for security
Germany and Sweden’s Securitas. industry is a third market segment, requir- products for asset protection outside the
There are also numerous small, local com- ing garage boxes and secure storage facili- banking sector amongst companies that
panies on most sub-markets in Europe, which ties, for example. handle large quantities of cash, including
canvass narrowly defined market segments. The market for conventional indoor retailers, petrol stations, public authori-
perimeter protection is believed to have ties and service establishments.
The market for perimeter protection moderate development potential, whereas • An increase in Gunnebo’s sales of servic-
Gunnebo Perimeter Security is the Group’s the potential for system deliveries to the es ancillary to physical and electronic
division for outdoor and indoor perimeter manufacturing sector is believed to be security products during the 2003 finan-
protection through Gunnebo Perimeter brighter. A strong local presence combined cial year. Many customers now receive
Protection and Gunnebo Troax respectively. with expertise in customer-oriented system 24-hour service on all their security
Gunnebo Perimeter Protection is one sales will remain essential, as will detailed products.
of Northern Europe’s leading suppliers of knowledge of the relevant local security • Major contracts were received during the
products and services for outdoor perime- regulations, as a means of strengthening year for the modernisation and conver-
ter protection. The European market is the market position. sion of mechanical and manual security
estimated to be worth some 10 billion kro- products into electronic and automatic
nor in total, and to be growing only slowly. Strong growth in Asia ones.
Gunnebo Perimeter Protection has a More than half of the world’s population • An increased number of deliveries of
market share of some 6 per cent in Europe. live and work in Asia. complete security systems, including out-
The main competitors with broad cov- To date, this market has accounted for door perimeter protection, access control
erage include Bekaert, CRH Fencing and only 10-15 per cent of the world’s existing systems with CCTV, alarm installations
Security, Dirickx, Elkosta, Rivisa and Best security installations. According to a study and conventional security products such
Fencing Group, along with numerous carried out in 2003 by Freedonia, an as burglar- and fire-resistant safes.
small, local competitors. The process of American market research company, the • More stringent legal requirements for
consolidation on this market has already market for security products in this region greater security, which provided a plat-
begun with CRH Fencing’s acquisition of will grow by at last 10 per cent a year dur- form for significant non-recurring con-
Adronit. ing the coming five year period. In tracts in 2003, above all in France.
Gunnebo Perimeter Protection will also response to this growing market demand
make a number of acquisitions with the for security solutions, Gunnebo has
9 Gunnebo Annual Report 2003
Report of the Directors
Review of the group
Market developments Of the companies within Gunnebo
The security market is characterised by sus- Invoiced sales Integrated Security, Fichet Securité
tained healthy growth, even though certain Electronic in particular significantly streng-
markets and product areas are growing at MSEK thened its market position outside its tradi-
8,000
lower rates. 7,000
tionally strong bank sector. Important
The Group’s foreign sales ratio was 6,000 security installations were carried out dur-
90 per cent (91). 5,000 ing the year for customers in the transport
The sales trend in Europe, which 4,000 sector, department stores, the automotive
3,000
accounts for over 85 per cent of Gunnebo industry, casinos, prisons and the public
2,000
Security’s sales, was firm, particularly in sector. The updated version of the Arcana
1,000
France, Spain and Scandinavia, while the 0 alarm has been well received on the mar-
German market remained weak. In France, 99 00 01 02 03 ket. Ritzenthaler and Gunnebo Entrance
s Sweden
the security market was affected during the s Abroad Control both made good progress.
year by stricter legislation requiring the Gunnebo Entrance Control successful-
banking industry to implement certain ly launched two new products: the PasSec
measures to tighten security by the end of Operating profit, anti-reflow security booths, which has been
2003. Consequently, Gunnebo Security Gunnebo Security and sold to customers like the Norwegian Civil
delivered a very high volume of security Gunnebo Engineering Aviation Administration, and ImmSec, a
products during the year. Outside of unique automated immigration security
Europe, market developments were favour- MSEK gate with biometric identification.
500
able in Indonesia and on several agency Within Gunnebo Perimeter Security,
markets, such as Russia and in Africa. 400 both Gunnebo Perimeter Protection and
Review of the group
Gunnebo Security’s market strategy for 300
Gunnebo Troax experienced weak markets.
the past year retained its focus on improv- The markets for perimeter protection were
200
ing profitability, which involved giving pri- characterised by considerable excess capaci-
ority to margins rather than volume on cer- 100 ty, which put heavy pressure on prices on
tain markets and in certain product areas. 0
several markets.
For Gunnebo Physical Security, devel- 99 00 01 02 03 Gunnebo Perimeter Protection’s new
opments in the banking automation seg- s Operating profit before depreciation of divisional management drew up an action
goodwill, Gunnebo Security
ment were very favourable, with several s Operating profit before depreciation of plan during the year to restore the division
goodwill, Gunnebo Engineering
large orders from French, German, Dutch to profitability. A decision was also taken
and Scandinavian high-street banks, where- regarding Gunnebo Perimeter Protection’s
as the demand for traditional bank prod- active role in the consolidation of the
ucts was more subdued. OEM deliveries of European market for perimeter protection.
ATM safes for automatic cash dispensers Profit after financial The Scandinavian market has developed
declined during the year. items and return on equity well, while the markets in Germany and
SafePay – the Group’s secure cash hand- Holland were relatively weak.
ling system for the retail sector – was Gunnebo Troax also had a weak year in
launched successfully on several primary MSEK % 2003 owing to slacker demand in the
350 35
markets in Europe. Deliveries commenced building industry on the key markets in
300 30
towards the end of the year to ICA/Statoil England, Germany and Sweden. The mar-
250 25
in Sweden, Denmark and Norway and to ket for machine protection was more
200 20
COOP-Fakta stores in Denmark. favourable, with for instance important
150 15
Agreements on additional test installations 100 10
installations to some of Europe’s largest car
were signed with large retail chains in 50 5
manufacturers. Gunnebo Troax took far-
Germany, Holland and Sweden. During 0 0
reaching actions during the year to restore
the end of the year SafePay signed con- 99 00 01 02 03 the business to profitability.
s Profit after financial items, MSEK
tracts on additional test installations in s Of which items
Gunnebo Steelage performed satisfac-
new retail-segments, for example bakeries affecting comparability tory in 2003. The factory in Halol was
s Return on equity, %
and drugstores. extended and modernised. Products from
Gunnebo Physical Security’s service the new factory will significantly strength-
operations continued to make good en Gunnebo Steelage’s market position.
progress. Gunnebo’s security-related businesses
Gunnebo Integrated Security contin- in India, Indonesia, Australia, Singapore,
ued to do well in France, which is Malaysia and China were brought together
Gunnebo’s largest market. on January 1, 2004 within a newly formed
10 Gunnebo Annual Report 2003
division, Gunnebo Asia Pacific. accounted for 1 percentage point, and Ritzenthaler have made very good progress
Within Gunnebo Engineering, the acquisitions for 2 points, while currency with solid improvements in volume and
markets for Gunnebo Lifting in England, fluctuations reduced the figure by 3 per- margins. Gunnebo Entrance Control’s
Holland, Ireland, South Africa and Japan centage points. business noted a very strong performance.
developed well. Both Gunnebo Security and Gunnebo The business in Indonesia remained stable.
Anti-skid products also enjoyed healthy Engineering noted organic growth in Gunnebo Perimeter Security’s operat-
demand, and the integration with invoiced sales of 1 per cent. Gunnebo ing margin narrowed to 2.7 per cent (4.5).
Tellefsdal’s anti-skid division, which was Security’s invoiced sales amounted to Both Gunnebo Perimeter Protection and
acquired in the middle of the year, greatly MSEK 5,817 (5,810) and Gunnebo Gunnebo Troax reported lower margins.
strengthened market positions in Norway Engineering’s to MSEK 1,144 (1,166). Non-recurring costs were taken against the
and on the North American market. result in connection with the current devel-
Gunnebo Block, with most of its sales Results opment process that is intended to improve
on the American market, has carried out a The consolidated operating profit before profitability. The result was also affected by
far-reaching cost-reduction programme depreciation (EBITDA) increased by 6 per negative currency effects of MSEK 15.
designed to adapt production to the steadi- cent to MSEK 627 (590) and the operat- Gunnebo Steelage’s business in India
ly declining demand. ing margin improved to 9.0 per cent (8.5). noted an operating margin of 5.4 per cent
Gunnebo Fastening’s markets in The operating profit before goodwill (4.0).
Sweden and Poland developed favourably, depreciation (EBITDA) increased by 9 per Gunnebo Engineering’s profit
whereas the markets in Finland and cent to MSEK 466 (426), which reflects an improved by 7 per cent to MSEK 87 (81)
Norway were weaker. improvement of the operating margin to and its operating margin improved to 7.6
6.7 per cent (6.1). per cent (6.9). Gunnebo Lifting’s result
Order intake and invoicing Gunnebo Security’s operating profit and margin improved, while Gunnebo
Review of the group
The Group’s order intake for the year improved by 11 per cent to MSEK 428 Block reported a poorer result owing to the
declined by 2 per cent to MSEK 6,994 (385) and the operating margin increased persistent weakness of the American econo-
(7,150). to 7.4 per cent (6.6). my and the depreciation of the US dollar.
After adjustments for acquisitions and All units within Gunnebo Security, Gunnebo Fastening had a poor year in
currency fluctuations, the order intake except Gunnebo Perimeter Security, Finland, and its overall result showed a
declined by 1 per cent. Company acquisi- achieved improved results and operating slight deterioration.
tions raised the order intake by 2 per cent margins. Gunnebo Physical Security The consolidated operating profit after
while currency fluctuations reduced it by improved its operating margin to 7.8 per depreciation of goodwill (EBIT) rose to
3 per cent. cent (6.5). A healthy earnings trend was MSEK 399 (361). This figure includes
Gunnebo Security’s order intake noted in countries such as France, depreciation according to plan of MSEK
decreased by 2 per cent to MSEK 5,830 Belgium, Sweden and Denmark; in 228 (229), of which goodwill depreciation
(5,945). Gunnebo Engineering’s order Holland the result remained stable, while it accounted for MSEK 67 (65) and other
intake declined by 3 per cent to MSEK deteriorated slightly in Germany, England depreciations of MSEK 161 (164).
1,164 (1,205). The organic growth in the and Canada. The business in South Africa Net financial costs improved to MSEK
orderintake declined by 1 per cent at both has been incurring losses and production 58 (cost 81), largely thanks to a strong cash
Gunnebo Security and Gunnebo has been discontinued. flow and lower interest rates in the Group’s
Engineering. Gunnebo Integrated Security improved main currencies.
The Group’s invoiced sales amounted its operating margin to 8.6 per cent (6.8). The profit after net financial items
to MSEK 6,961 (6,976). Organic growth In France, Fichet Securité Electronic and improved by 22 per cent to MSEK 341
Invoiced sales, operating profit, operating margin and return on capital employed
Return on capital
Invoiced sales, MSEK Operating profit, MSEK Operating margin, % employed, %
2003 2002 2001 2003 2002 2001 2003 2002 2001 2003 2002 2001
Gunnebo Security 5,817 5,810 5,465 428 385 315 7.4 6.6 5.8 27.5 22.9 20.9
Gunnebo Engineering 1,144 1,166 1,206 87 81 86 7.6 6.9 7.1 12.3 11.1 11.5
Central Group items – – – –49 –39 –30 – – – – – –
Items affecting comparability – – – – –1 11 – – – – – –
Group total before
depreciation of goodwill 6,961 6,976 6,671 466 426 382 6.7 6.1 5.7 19.2 16.8 16.6
Depreciation of goodwill – – – –67 –65 –61 – – – – – –
Group total 6,961 6,976 6,671 399 361 321 5.7 5.2 4.8 12.1 10.4 10.1
11 Gunnebo Annual Report 2003
(280). Company acquisitions contributed Sales by market, MSEK
MSEK 4 to the result, while currency fluc-
2003 2002 2001
tuations reduced the profit by MSEK 30.
France 1,801 26 % 1,663 24 % 1,447 22 %
The result, excl. acqusitions and currency
Germany 674 10 % 680 10 % 637 10 %
effects improved by MSEK 87, or with
Sweden 671 10 % 638 9% 621 9%
31 per cent.
Great Britain 669 10 % 808 12 % 757 11 %
Tax costs amounted to MSEK 80 (51). Spain 440 6% 430 6% 391 6%
The consolidated result after tax increased Denmark 276 4% 227 3% 221 3%
by 14 per cent to MSEK 260 (229). The Netherlands 255 4% 258 4% 271 4%
The return on capital employed Norway 239 3% 282 4% 272 4%
improved to 19.2 per cent (16.8) before USA 230 3% 292 4% 273 4%
goodwill depreciation and to 12.1 per cent Other 1,706 24 % 1,698 24 % 1,781 27 %
(10.4) after goodwill depreciation. Group Total 6,961 100 % 6,976 100 % 6,671 100 %
A county court decision handed down
in June rejected a deduction on the sale of
shares. Gunnebo, as previously reported, is
standing firm on its position, which has the
support of leading tax specialists, and has (Germany), Dordrecht (Holland) and continuing operations amounted to MSEK
appealed the decision to the Fiscal Court of Wadeville (South Africa) were closed and 465 (462), of which structuring costs that
Appeal. Should the company not be co-determination at work negotiations have influenced the cash flow resulted in a
allowed by the court of final instance to begun on the closure of the factory in deficit of MSEK 87 (deficit 57).
make this deduction it would incur an Malung (Sweden). The operating cash flow after invest-
Review of the group
additional tax cost of some MSEK 80. No A sum of MSEK 101 from the Group’s ment activities and chan-ges in working
provision has been made. total structuring reserve was utilised during capital, but before interest, paid tax and
the period, after which the remaining struc-turing costs, amounted to MSEK 500
Company acquisitions reserve amounts to MSEK 51, which will (501). The very good level from last year
On 1 July, Gunnebo Engineering acquired be used for the remainder of the structur- was maintained as a result of further reduc-
the anti-skid division of Tellefsdals A/S, ing programme. tions in the capital tied up in inventories
which has an annual turnover of some and operating recei-vables. Gunnebo
MSEK 45 and 50 employees. The acquisi- Product development Security’s cash flow amounted to MSEK
tion complements other anti-skid activities The Group’s expenditure on the develop- 470 (435) and Gunnebo Engineering’s to
in the transport and farming segments and ment and maintenance of its existing MSEK 83 (88).
has significantly strengthened the market product programme and the develop-
position in Norway, the USA and Canada. ment of entirely new products in existing Liquid funds and financial position
In order to further strengthen its posi- or new market segments amounted to The Group’s liquid funds amounted to
tion on the automated cash handling mar- around MSEK 100, of which MSEK 33 MSEK 221 (362), over and above which
ket, Gunnebo Physical Security acquired in (28) were capitalised in the balance sheet the Group has undrawn credit facilities
November 2003 Kubon AG, a German as intangible fixed assets. amounting to some MSEK 1,385.
company with an annual turnover of some The Group’s net loan liabilities
MSEK 60 and 55 employees. Kubon’s Capital expenditure declined by MSEK 272 to MSEK 1,309
main business is the manufacture of auto- The Group’s fixed capital expenditure, (1,581).
matic coin-roll dispensers. Kubon also exclusive of company acquisitions, amount- The equity ratio rose to 37 per cent
manufactures automatic change machines ed to MSEK 198 (168), a level that corre- (30) and the debt-equity ratio declined to
and cash cabinets with inbuilt timelocks. sponds to 123 per cent (102) of the peri- 0.7 (1.0).
After two years of consolidating a faster od’s depreciation. The investments were In July, an agreement was reached on a
expansion through acquisitions is to be largely for replacement and rationalisation. five-year MEUR 200 credit facility. The
expected. Net capital expenditure after deducting loan, which is a Multicurrency Revolving
sales of fixed assets amounted to MSEK Credit Facility, replaces a corresponding
Structuring programme 190 (161). loan of MEUR 143.
The Group’s three-year restructuring pro- Gunnebo Security’s capital expenditure
gramme for safe production was virtually amounted to MSEK 146 (117) and Employees
completed in 2003. The programme fol- Gunnebo Engineering’s to MSEK 49 (50). The number of employees at the end of the
lowed agreed time schedules and cost year was 8,108 (8,351). The number of
budgets and brought high-grade safe pro- Cash flow employees abroad was 7,157 (7,413), of
duction capacity into line with demand. The Group’s cash flow remained very whom 2,219 (2,274) were employed in
During the year the factories in Mörfelden strong during the year. Cash flow from India and Indonesia. The number of
12 Gunnebo Annual Report 2003
employees in Sweden was 951 (938). the Chairman, one board member and the
During the year the number of employees Fixed capital expenditure CEO whose role is to decide such matters
increased by 105 as a result of acquisitions. and depreciation as the employment conditions of the
MSEK Group’s executive management.
200 In addition to this, the compensation
Per share data
Earnings per share after full conversion committee deals with the question of man-
150
amounted to SEK 11.95 (10.55), an agement succession and the identification
increase of 13 per cent. Equity per share 100 of potential managers as well as other
after full conversion increased to SEK aspects of personnel development prepared
86.95 (79.10). 50 by the management.
The number of shareholders at the
0
year-end was 9,500 (9,800). 99 00 01 02 03 Introduction of IFRS 2005
s Fixed capital expenditure As of 2005, Gunnebo will start to present
s Depreciation excluding goodwill
Parent company its financial reports in accordance with
The parent company’s business consists pri- IFRS (International Financial Reporting
marily of the provision of functions for Interest cover Standards). It will be mandatory for all list-
group management, corporate develop- ed companies in the EU to present their
ment, human resources, legal affairs, finan- times reports in accordance with IFRS as of
cial control/finance and information. 6 2005. During 2003, a study of all compa-
5 nies in the Gunnebo Group was carried
The Board and its procedures 4 out to identify differences between their
The Board, whose activities are based on a 3 current reporting practices and IFRS.
Review of the group
set of written procedures and an instruc- 2
The single most important difference
tion for the President, has seven members relates to IAS 19, which covers the
1
who are elected by the Annual General accounting treatment of pensions. IAS 19
0
Meeting. In addition, three members and 99 00 01 02 03 accords with the Swedish Financial
one deputy are elected by the unions to Accounting Standards Council’s
represent the employees. In 2003, the Recommendation RR29, which will
Board had six minuted meetings over and Balance sheet already come into effect in 2004. It is esti-
above the statutory meeting. One meeting total and equity mated that the difference in accounting
was held at Gunnebo/Ritzenthaler’s factory principles will result in a reduction of some
MSEK
in Baldenheim, France. 6,000 MSEK 100 in equity.
The activities of the Board followed a 5,000
The accounting treatment of hedges
prearranged plan and decisions have been arranged to cover future currency flows
4,000
made on capital expenditure, acquisitions will, in accordance with IFRS, be valued at
3,000
and other major structural changes etc. closing date rates. Based on the applicable
2,000
Gunnebo’s Annual General Meeting exchange rates on 31 December 2003, the
1,000
held on 29 April 2003 elected a nomina- new rules would have resulted in an
tions committee consisting of Roger 0 increase in equity of MSEK 3.
99 00 01 02 03
Holtback (Chairman of the Board), Nils- Otherwise, no significant differences
s Balance sheet total
Olov Jönsson (Board member), Dan Sten s Of which equity have been identified. Non-recurring effects
Olsson of Stena-Gruppen and Ragnhild of the changeover to RR29 will be stated
Wiborg of Odin Fonder. No. of employees direct against equity in accordance with
The company’s auditors report their at year-end RR5 Accounting Treatment of Changes in
observations to the Board as a whole. Accounting Principles.
There is no separate audit committee as 10,000
such, but the Chairman and one member Outlook for 2004
8,000
of the Board serve as a planning body for The commercial outlook for the financial
contacts between the auditors and the 6,000 year 2004 as a whole is good. According to
Board and they have held separate plan- 4,000 the normal seasonal pattern the first quar-
ning meetings with the auditors. During ter result is expected to be weak. A profit
2,000
the year, the auditors attended two Board forecast will be published in connection
meetings to present their views following 0 with the first quarter interim report.
99 00 01 02 03
completion of their audit. s Sweden
Within the Board there is a special s Outside Sweden
compensation committee which consists of
13 Gunnebo Annual Report 2003
Five-year review
During the past five years Gunnebo has adhered to a long-term strategy that involved
developing the security business conducted by Gunnebo Security as well as
Return on capital
strengthening Gunnebo Engineering’s business. In both these segments, strategic
employed acquisitions and organic growth combined with profitability improvements have been
%
key elements in the strategy. During the past two years, measures to improve the
20 result and margins, and to strengthen cash flow, were given priority over volume
growth.
15
10 Income statement, MSEK 2003 2002 2001 2000 1999
Invoiced sales 6,961 6,976 6,671 5,000 5,264
5 Cost of goods sold –4,680 –4,738 –4,604 –3,489 –3,734
Gross operating profit 2,281 2,238 2,067 1,511 1,530
0 Items affecting comparability – –1 11 115 31
99 00 01 02 03 Other operating costs –1,882 –1,876 –1,757 –1,287 –1,237
Operating profit 399 361 321 339 324
Interest in earnings of associate companies – – 5 40 17
Net financial items –58 -81 –103 –54 –75
Return on equity Profit after financial items 341 280 223 325 266
Taxes –80 –51 –58 –78 –67
% Minority interest in profit –1 0 0 0 0
20 Net profit 260 229 165 247 199
15 Balance sheet, MSEK 2003 2002 2001 2000 1999
Intangible fixed assets 1,048 1,050 1,063 903 607
10 Tangible fixed assets 1,011 1,041 1,087 990 1,146
Financial fixed assets 81 131 137 66 62
5 Inventory 1,061 1,090 1,185 1,002 885
Five-year review
Operating receivables 1,668 1,760 1,819 1,722 1,281
0 Liquid funds 221 362 295 339 212
99 00 01 02 03 Total assets 5,090 5,434 5,586 5,022 4,193
Equity 1,870 1,646 1,513 1,456 1,263
Operating cash flow, excluding Minority interests 6 6 7 11 6
restructuring costs Interest-bearing provisions and liabilities 1,541 1,957 2,179 1,728 1,565
Other provisions and liabilities 1,674 1,825 1,887 1,827 1,359
Total equity and liabilities 5,090 5,434 5,586 5,022 4,193
MSEK
600
Cash flow analysis, MSEK 2003 2002 2001 2000 1999
500
Cash flow from current operations
400 before changes in working capital 360 394 136 259 308
300 Change in working capital 105 68 7 –162 –52
Cash flow from current operations 465 462 143 97 256
200
100 Operative cash flow, MSEK 2003 2002 2001 2000 1999
0 Operative cash flow excluding structuring costs 500 501 348 173 264
99 00 01 02 03 Operative cash flow including structuring costs 413 444 170 93 236
DEFINITIONS Cash flow per share: Cash flow from current oper- Return on equity: Profit after tax as a percentage of
ations divided by the number of shares in issue after average equity.
dilution.
Gross margin: Gross profit as a percentage of Return on operating capital: Operating profit before
invoiced sales. Net debt: Interest-bearing provisions and liabilities depreciation of goodwill as a percentage of average
including loan stock less liquid funds and interest- capital employed excluding goodwill and liquid funds.
Dividend yield: Dividend in relation to listed price on bearing receivables.
December 31. Return on capital employed: Operating profit plus
Operative cash flow: Cash flow from current oper- financial income as a percentage of average capital
Equity per share after dilution: Equity and con- ations, after fixed capital expenditure but before employed.
vertible loans plus the value of outstanding options interest and tax paid.
divided by the number of shares in issue after dilu-
tion. P/E ratio: Listed price on 31 December divided by
earnings per share after dilution.
Capital turnover rate: Invoiced sales in relation to
average capital employed.
14 Gunnebo Annual Report 2003
Gunnebo Security 2003 2002 2001 2000 1999
Invoiced sales, MSEK 5,817 5,810 5,465 3,851 3 342
Operating profit, MSEK* 428 385 315 182 200 Operating profit and
Operating margin, % 7.4 6.6 5.8 4.7 6,0 operating margin
* Before depreciation of goodwill and excluding items affecting comparability.
MSEK %
Gunnebo Engineering 2003 2002 2001 2000 1999 400 8
Invoiced sales, MSEK 1,144 1,166 1,206 1,149 1 946
Operating profit, MSEK* 87 81 86 104 166 300 6
Operating margin, % 7.6 6.9 7.1 9.1 8,5
* Before depreciation of goodwill and excluding items affecting comparability. 200 4
Key ratios 2003 2002 2001 2000 1999 100 2
Return on capital employed before
depreciation of goodwill, % 19.2 16.8 16.6 22.5 18.6 0 0
Return on capital employed, % 12.1 10.4 10.1 15.4 12.7 99 00 01 02 03
Return on capital employed, excluding
s Operating profit, MSEK
items affecting comparability, % 12.1 10.4 9.8 11.0 11.6
s Operating margin, %
Return on equity, % 14.8 14.5 11.1 18.2 17.0
Return on equity, excluding items
affecting comparability, % 14.8 14.5 10.7 10.1 14.6
Gross margin, % 32.8 32.1 31.0 30.2 29.1 Capital employed
Operating margin before depreciation, % 9.0 8.5 8.4 10.3 10.0
Operating margin before depreciation MSEK
of goodwill, % 6.7 6.1 5.7 7.6 7.0 4,000
Operating margin, % 5.7 5.2 4.8 6.8 6.1
Operating margin, excluding items 3,000
affecting comparability, % 5.7 5.2 4.6 4.5 5.6
Profit margin, % 4.9 4.0 3.3 6.5 5.0 2,000
Capital turnover rate 2.0 1.9 1.9 1.9 1.9
Five-year review
Equity ratio, % 37 30 27 29 30 1,000
Interest cover 5.8 4.1 3.0 5.5 4.6
Debt/equity ratio 0.7 1.0 1.2 0.9 1.1 0
99 00 01 02 03
Data per share, SEK 2003 2002 2001 2000 1999
Earnings per share after dilution 11.95 10.55 7.65 11.40 9.40
Earnings per share after dilution,
Equity and equity ratio
excluding items affecting comparability 11.95 10.55 7.35 6.40 7.95
Equity per share after dilution 88.35 79.10 73.10 70.50 62.50 MSEK %
Dividend 4.50* 4.00 3.50 4.25** 3.25 2,000 40
Listed price 31 December 179.50 124.00 126.00 90.50 76.00
* Board proposal 1,500 30
** Including bonus of SEK 1:00
1,000 20
Other information 2003 2002 2001 2000 1999
Foreign sales ratio, % 90 91 91 88 77 500 10
Order intake, MSEK 6,993 7,150 6,660 5,001 5,268
Capital employed, MSEK* 3,417 3,610 3,699 3,195 2,835 0 0
Net debt, MSEK* 1,309 1,581 1,872 1,359 1,349 99 00 01 02 03
Fixed capital expenditure, MSEK 198 168 173 117 173
s Equity, MSEK
Depreciation, MSEK 228 229 237 174 202 s Equity ratio, %
Of which depreciation of goodwill, MSEK 67 65 61 39 43
Average no. of employees 8,273 8,250 8,290 5,653 4,949
* At year-end
Return on capital employed before depreciation Operating margin before depreciation of good- Profit margin: Profit after financial items as a per-
of goodwill: Operating profit before depreciation of will: Operating profit before depreciation of goodwill centage of invoiced sales.
goodwill plus financial income as a percentage of as a percentage of invoiced sales
average capital employed excluding goodwill. Earnings per share after dilution: Profit after tax
Debt/equity ratio: Net debt divided by the sum of plus interest costs after tax on convertible loans, divid-
Interest cover: Profit after financial items plus inter- equity and minority interests. ed by the number of shares in issue after dilution.
est costs divided by interest costs.
Equity ratio: Equity including minority interests as a
Operating margin: Operating profit as a percentage percentage of balance sheet total.
of invoiced sales.
Capital employed: Balance sheet total less interest-
free provisions and liabilities.
15 Gunnebo Annual Report 2003
Financial risk management
and sensitivity analysis
The object of Gunnebo’s financial Financing risk has two long-term credit facilities, which
activities is to minimise the Financing risk is the risk that financing will amount in total to MSEK 500, and which
Group’s long-term financing costs not be available in the future or that the run until 2005 and 2008 respectively. The
and manage and control its finan- financing conditions are, for whatever rea- Group also has access to principally short-
cial risks in an effective manner. son, particularly unfavourable at any given term credit facilities amounting to some
Given the international charac- point in time. Gunnebo’s general aim is to MSEK 430, as well as local financing for
ter of its business, Gunnebo is have predominantly long term credit agree- subsidiary companies.
exposed to financial risks in con- ments with the object of limiting this risk.
nection with changes in interest Gunnebo has agreed credit facilities Liquid funds
rates, exchange rates and refi- totalling some MSEK 2,750, of which Closing liquid funds amounted to MSEK
nancing, and counterpart risks. MSEK 1,365 had been drawn at the year- 221. The Group also had available un-
end. The average duration of the Group’s drawn credit facilities of MSEK 1,385.
Currency and interest rate changes agreed loan facilities was 3.8 years; The financial policy guidelines stipulate
In 2003, the US dollar weakened further Gunnebo’s borrowing is at a fixed interest that liquid funds and undrawn credit facili-
in relation to the Swedish krona, depreciat- margin throughout the term of the agree- ties shall always amount to a minimum of
ing from 8.74 at the beginning of the year ments. MSEK 300.
to 7.27 at the end. The sterling also weak- According to the finance policy, at least Gunnebo has centralised its liquidity
Financial risk management and sensitivity analysis
ened against the krona during the year. At two-thirds of the Group’s loan portfolio management in the form of cash pools at
the end of the year, the euro was more or shall have a minimum duration of twelve national level in the large European coun-
less unchanged in relation to the Swedish months. tries where it is active. The Group uses
currency. In 2003, Gunnebo arranged with a these “cash pools” to match the local sub-
The short-term market interest rates in consortium of 15 banks a new MEUR 200 sidiaries’ surpluses and deficits in each
Gunnebo’s most important borrowing cur- syndicated Multi-Currency Revolving country and currency.
rencies – Swedish kronor, Swiss francs and Credit Facility with a five-year duration. The aim is to minimise interest-bear-
euro – declined further in the spring of This loan, which replaced a MEUR 143 ing liabilities, and to use liquid funds pri-
2003, as a result of central banks cutting syndicated loan facility, has an interest marily to reduce outstanding liabilities.
their prime rates. margin of 0.55 per cent at the current
The figure alongside shows the past debt-equity ratio. In addition, Gunnebo Interest rate risk
five years’ changes in the interest rates The interest rate risk refers to the effect
and currencies with the greatest impact on the Group’s net interest costs of a
on the Group’s cash flow and result. Exchange rates 1999-2003 lasting change in market interest rates.
SEK
x USD x EUR x GBP
The sensitivity of the result can, howev-
16
Organisation and activities er, be limited by the interest maturity
15
The Gunnebo Group’s financial activities structure.
14
are centralised at its subsidiary Gunnebo According to Gunnebo’s finance
13
Treasury SA. Gunnebo Treasury is policy, the average duration of the fixed
12
responsible for the Group’s mainly exter- 11
interest rate period may fluctuate
nal financing, centralised cash manage- 10 between 4 and 12 months. At the end
ment and currency risk management. It 9 of the year, Gunnebo’s portfolio had an
also functions as the Group’s internal 8 average interest rate duration of 8 (7)
bank, and is responsible for supporting 7 months, and the average rate of interest on
1999 2000 2001 2002 2003
the Group’s subsidiaries with loans, the entire loan portfolio was 3.6 % (4.6).
placements and currency transactions.
3 month interest rates 1999-2003
Through the centralisation the Group is Currency risk
allowed to benefit from economies of Currency fluctuations affect the Group’s
Interest, % x STIBOR 3 months x CHF3 months x EUR 3 months
scale and synergies within the financial 6 result and equity as a result mainly
area. 5
depending on the following currency
The financial activities are carried exposures:
4
out in accordance with the financial poli- • Transaction exposure – the result is
cy established by the Board, which regu- 3 affected by the fact that income and
lates how financial risks are to be man- 2 costs are denominated in different
aged, and sets the limits within the inter- 1
currencies
nal bank and Gunnebo’s subsidiaries may • Result exposure – the result is affected
0
operate. 1999 2000 2001 2002 2003 by the fact that foreign subsidiaries’
results are translated into Swedish kro-
16 Gunnebo Annual Report 2003
nor on average exchange rates for the lation effects and changes in spot rates had explained below. The calculation is made
period the effect of reducing the result by MSEK on the basis of the Group’s structure at the
• Translation exposure – subsidiary compa- 30, in relation to the previous year, of year-end and assuming all other factors
nies’ net assets in foreign currencies are which a reduction of MSEK 27 affected remain unchanged.
translated into Swedish kronor at closing the operating result.
date rates. The differences thus arising Selling prices
from changes in exchange rates since the Translation exposure A change of one per cent in selling prices
previous closing date are taken direct to The Group’s foreign net assets amounted affects income and the result after financial
equity to MSEK 3,460 (3,313) on 31 December items by some MSEK 70.
2003. The Group hedges a large propor-
Transaction exposure tion of these assets by raising loans or Labour costs
Foreign sales accounted for 90 % (91) of entering into forward contracts in corre- A change of one per cent in labour costs,
the Group’s total turnover. Since many of sponding currencies. On the closing date, including social security charges, affects the
the costs are incurred in the same currency MSEK 3,221 (3,087), or 93 % (93), were result after financial items by some MSEK 25.
as income, the transaction exposure is hedged.
greatly reduced. All in all, Gunnebo’s net Interest costs
flows into Sweden in foreign currencies Credit and counterpart risks On the basis of the average duration of the
Financial risk management and sensitivity analysis
amount to some MSEK 250 a year. The Group has no significant concentra- Group’s total loans outstanding at the year-
According to the Group’s finance policy, at tion of its credit risks. Counterparties to end, a simultaneous change of one per cent
least 70 % of the estimated currency derivative contracts and cash transactions in all of Gunnebo’s loan currencies would
inflows for the coming 12 months are to are limited to financial institutions with a affect the result by MSEK 6 during the fol-
be hedged. At the closing date, the propor- high credit rating. lowing 12 months.
tion hedged was 86 % (76). The value of
the Group’s forward contracts calculated on Financial derivative instruments Currencies
the spot rates of the contracts amounted to Financial derivative instruments such as A change of 10 % in the exchange rate of
MSEK 218 at the year-end. The correspon- forward contracts, “swaps”, and, to a cer- the Swedish krona against the euro, sterling
ding value based on closing date rates was tain extent, options are used to manage and the US dollar would affect the result
MSEK 215. This profit will be taken into and control financial risk. Derivative after financial items by around MSEK 50,
the income statement when the respective instruments are used in order to reduce the of which MSEK 20 would be transaction
contracts expire during the coming 12- exposure to financial risks. exposure, without taking the Group’s
month period. The Group has also arranged interest hedges into account. The remaining MSEK
A weighted currency index for the swaps that are not included in the closing 30 is attributable to result exposure. Taking
Group’s most important currencies balance sheet. The nominal amount of into account the hedges in place at the
declined by 4.8 % during the year, which these swaps is just over MSEK 470 and year-end, the effect of the transaction expo-
means that these currencies weakened their average term is 1.3 years. The market sure on the result for the coming 12
against the Swedish krona. Forward con- value, were they to be closed at the end of months would be marginal.
tracts that matured during the period had a the year, is marginally negative. The figure below illustrates the sensi-
positive effect of MSEK 10 (6) on the tivity of the result at a 10 per cent change
result, when compared with the conversion in the exchange rate of each currency.
of currency flows at the spot rates prevail- Sensitivity analysis
ing at the time of conversion. The sum of The result is affected by changes in certain
currency fluctuations in the net flow, trans- factors of importance to the Group, as
Currency flow exposure Loan maturity structure, MSEK Sensitivity analysis, currencies
Based on estimated net flow for 2004 at 10 % change
Mature Credit Of which
MSEK in year facility drawn Proportion
MSEK
200 2004 391 91 7% 35
2005 200 130 10 % 30
150
2006 8 8 – 25
2007 2 2 – 20
100
15
2008 2,149 1,134 83 %
50 10
Total 2,750 1,365 100 %
5
Currency EUR GBP USD NOK AUD DDK
0
EUR GBP USD
Proportion
hedged, % 100 84 71 71 74 60
s Result exposure
Hedged at
9:09 13:20 7:78 1:09 5:40 1:23 s Transaction exposure
average rate of
17 Gunnebo Annual Report 2003
Gunnebo Physical Security
GUNNEBO PHYSICAL SECURITY 2003 2002 2001
Invoiced sales, MSEK 2,627 2,597 2,590
Operating profit, MSEK* 204 170 140
Operating margin, %* 7.8 6.5 5.4
Return on operating capital, %* 23 18 16
Capital expenditure, MSEK 74 57 48
No of employees 2,696 2,973 2,300
* before goodwill
Sales by product area Sales by market
s Burglar- and s France, 28%
fire-resistant safes, s Great Britain, 13%
vaults and vault doors, 36% s Germany, 13%
s Retail and banking s The Netherlands, 7%
automation, 26% s Belgium, 6%
s Service, 25% s Canada, 5%
s Other, 13% s Sweden, 5%
s Norway, 5%
Torbjörn Browall s Other, 18%
Head of Gunnebo Physical Security
Gunnebo Physical Security
Operations in 2003 growth in France and Scandinavia especial-
Following numerous acquisitions, Gunnebo Products and services ly, it has weakened in England, Spain and
Physical Security has achieved a position High-graded burglar- and fire-resist- Italy, and was weak in Germany.
on the market as the world’s leading manu- ant safes. Security products for banks: The Russian market is developing very
facturer of high-graded burglar- and fire- safety deposit boxes, bank vaults and strongly, above all for bank boxes and elec-
resistant safes. The division has also vault doors. Security products for tronic locking systems. Outside of Europe,
evolved into one of the leading suppliers of cash handling and transportation for South Africa and Canada experienced low
products for banking automation and banks and retailers, such as automatic growth.
closed cash handling systems for the retail cash handling machines, service Gunnebo Physical Security improved
trade. boxes, deposit boxes and transit safes. its operating margin and earnings were
These positions have mainly been Fire-resistant safes for the storage of strong in France, Belgium, Sweden and
reached as key customers recognise the documents and data media in offices. Denmark, for example, but slightly poorer
division as the most innovative and com- Installation and service. in Germany, England and Canada. In
plete supplier of security products and South Africa the business has incurred loss-
services for the storage and handling of Brand names es and production has been discontinued.
cash and securities. The predominating Chubbsafes, Fichet-Bauche,
customer category consists of banks and Rosengrens, Garny, Leicher, Acquisitions
financial institutions, which particularly SecureLine To further strengthen its position in auto-
appreciate the division’s ability to deliver mated cash handling, the division acquired
turn-key systems that includes all security a German company, Kubon AG, during
products. the year. Kubon had a turnover of some
Thanks to the close co-operation MSEK 60 and had 55 employees in 2003.
between banking customers and the divi- Kubon’s main business consists of the
sion’s companies, mainly in Europe, it has The market for traditional security development, manufacture and marketing
been possible to further expand the service products for banking, such as bank vaults, of coin rolling machines for self service. It
activities, and develop and test new prod- safety deposit boxes, burglar-resistant safes, also has a range of change machines and
ucts, mainly for banking automation, in deposit safes, and ATM products (safes for cash cabinets with time locks.
real bank environments. automatic cash dispenser machines) has This acquisition will strengthen the
The market for automated banking tended to weaken. division in one of the fastest growing areas
services, such as deposit and withdrawal A further clear development in cash - automated cash handling for banks and
machines, coin rolling machines, safety handling is the shift away from the bank- the retail trade.
deposit robots and other automated cash ing system to the retail trade.
handling systems, has developed especially The market situation in Europe has
strongly. been very fragmented; it has shown healthy
18 Gunnebo Annual Report 2003
Millium DTM
In 2003, Fichet-Bauche installed its Millium
DTM closed system for depositing and
transferring day’s takings and till contents at
35 McDonald’s restaurants in France. The
system will markedly improve the security of
the personnel, while also improving cash-in-
transit efficiency. Cash-in-transit companies
can now collect the day’s takings and leave
a change till at any time of the day or night
as the transfer unit is accessed from outside
the restaurant.
D: DEPOSIT. The personnel deposit cash safely
through an opening in the top of the deposit unit.
The envelope with the cash cannot be removed
once it has been dropped into the unit. The money
falls through an opening into the transit safe. 2. The envelope falls into the transit safe,
where it remains until the safe is emptied.
T: TRANSFER. The cash is transferred in Millium 1. Restaurant
personnel place
DTM’s transit safe. The cash-in-transit personnel envelopes with 3. The cash-in-tran-
open the transit safe from the outside. The opening
Gunnebo Physical Security
the day’s takings sit personnel empty
is protected by a folding lid. inside the the envelopes from
deposit unit. the transit safe.
M: MONEY. When the cash-in-transit company
collects the day’s takings from the transit safe it 4. The cash-in-tran-
5. The till falls into sit personnel put a
leaves a till behind for the next day. The till falls the safe and can new till into the tran-
into the lower section of the safe, and can then be be removed by the sit safe.
removed by the restaurant’s personnel through an restaurant person-
nel from the
opening on the restaurant side. All transactions in
inside.
the system are recorded in a transit log.
Structuring programme
In connection with the acquisition of
Chubb Safes in 2000, a restructuring pro-
gramme was started with the object of
reducing production capacity for high-
graded, burglar- and fire-resistant safes in
Europe by 40 percent, thereby adapting
production to the prevailing demand as
well as streamlining the product range.
Factories in Canada and England have
already been closed and during the year the
plants in Mörfelden (Germany) and
Dordrecht (Holland) were also closed. The
factory in South Africa has been closed and
negotiations have opened to close the facto-
ry in Malung (Sweden).
As a result of the launch at the end of
the year of an entirely new series of fire-
resistant safes, mainly for the storage of
data media, the product rationalisation
The SafePay integrated cash handling system was launched on several markets in phase of the structuring programme has
Europe in 2003. This pilot unit has been installed in a food store in Holland. been completed. This is reflected, for
example in a reduction in the number of
19 Gunnebo Annual Report 2003
During the year, Gunnebo Physical Security launched a new series of banking products.
The product family consists of SafeCash R, a cash deposit and withdrawal machine
the SafeCash Eco deposit machine and the coin-roll machine SafeCoin D. The prod-
ucts are installed in the banks’ self-service banking halls, and broaden Gunnebo’s
competence as a supplier of total systems for the banking sector.
The new brand name for safes in lower
security grades and intended for the
SOHO market (small offices, home offices)
will be SecureLine.
Thanks to the common manufacturing
platform that applies to the different
brands valuable synergies can be achieved,
above all in product development and
manufacture.
A good example of this is the family of
fire-resistant safes that was newly developed
during the year.
Customers
The division is represented on about 120
markets, either through its own sales com-
panies on some 20 markets or through
agents and distributors on a further 100
markets.
Gunnebo Physical Securities largest
single customer category is still banking
Gunnebo Physical Security
and financial institutions. The fastest grow-
ing market segments are service, which cur-
Garny has modified the design and a rently accounts for some 25 percent, retail,
number of technical features on its AVM and products for automated banking.
safety deposity robot. The most important A segment that has been declining in
modification is on the customer’s termi- recent years is OEM deliveries of ATM
nal; the customer faces a small counter safes, for which the division is a sub-con-
with touch screen and an integrated card tractor supplying safes for automatic cash SafeCash ECO is a member of the
reader, which together guide the auto- machines. SafeCash family and complements
matic unit to the cartridge. This solution There has also been some co-ordina- Gunnebo Physical Security’s product
has been approved by all international tion in the marketing of products and serv- range for banking automation. The prod-
safety classification societies. The unit ices to multinational customers. uct can also be connected to (WIN) Safe
above is installed at Stadtsparkasse in Net Gunnebo’s software for cash han-
Hildesheim, Germany. Competitors dling and surveillance systems. A Safe-
Gunnebo Physical Security is market leader Cash ECO unit allows the customer to
by a wide margin on the market for high- move the deposit across the counter to
graded fire- and burglar-resistant safes. the self-service area. The machine is also
models and sizes from around 280 to the The competition comes mainly from pri- available on a 24/7 basis.
current 80. vately owned regional manufacturers such
The three-year restructuring programme as Format, Bode-Panzer, and Lampertz/
has thus adhered closely to the agreed time Sistec (Germany), Robur and Håbeco
table and cost budget. The structuring (Scandinavia), SMP and Dudley (Great SafePay – closed cash handling
reserve of MSEK 270 is expected to lead to Britain), Conforti (Italy) and Ferrimax and system for the retail trade
annual cost reductions of around MSEK Bausa (Spain). SafePay was launched at the end of 2002
125 with full effect from 2004 and most of On the Asian market, Gunnebo has and by February 2003 had already signed
the benefit coming through before the end one of the world’s most modern units for an initial agreement with ICA Ahold to
of 2003. the manufacture of safes. Located in deliver 4,800 complete SafePay systems
Djakarta it was inaugurated in 1998 and during 2004 and 2005 worth some MSEK
Very strong brand names became part of the group via the acquisi- 400. Deliveries to ICA started in the final
The brand name review carried out during tion of Chubb Safes in 2000. quarter of 2003, as did deliveries to Fakta
the year means that the number of names Low production costs combined with (COOP) in Denmark and further test
per product area will be reduced and in competitive distribution costs provide a installations in Holland and Germany.
future include Fichet-Bauche, Chubbsafes, sound basis for strengthening the competi- COOP Sweden has put SafePay through
Rosengrens, Garny and Leicher. tive position and further expansion of the full-scale tests in a store and approved both
division’s business. the technical characteristics and the sys-
20 Gunnebo Annual Report 2003
Test of fire-resistant safes
One type of test involves putting a
data-media safe, for instance, that
has been classified for 120 minutes
into a furnace where it is exposed for
A fire-resistant safe is designed to
two hours to temperatures of up to
prevent the contents from being
1000°C. The furnace is then switched
exposed to high temperatures even if
off and the safe is left there for 24
the ambient temperature in event of
hours before it is removed and the
a fire exceeds 1000°C.
test completed. Through out the
The development of fire-resistant
entire process the temperature inside
safes includes testing them at
the data-media safe is registered. For
Gunnebo’s new fire test facility in
the product to be approved, the tem-
Bazancourt before the final product
perature must not exceed 52°C.
receives its classification certificate
Another type of test simulates the
from an independent test institution
destruction by fire of the floor where
and goes into regular production.
the data-media safe is standing and
of the safe falling several storeys
inside the burning building. In the test
the safe is placed for 30 minutes in a
tem’s functionality when integrated with
test furnace that has been heated to
the COOP’s cash register system.
1000°C. It is then removed and
dropped from a height of nine metres
New series of fire-resistant safes
on to a pile of gravel. The safe is then
Fichet-Bauche, Chubbsafes and
exposed to a temperature of 1000°C
Gunnebo Physical Security
Rosengrens’ new fire-resistant safes, which
for another 90 minutes in the test fur-
all share a common platform, offer unique
nace, after which it is allowed to cool.
characteristics in terms of capacity and
The measuring equipment in the safe
weight.
registers that the inner temperature
As a means of optimising capacity the
does not exceed 52°C, despite this
safes have been designed from the inside
physical damage.
and out and are based on the format of
present and future data media. The weight
has been reduced by some 20 % by the use
of more effective and thinner protective
walls. The new series of safes have been Chubbsafes’ new DataPlus+ data-media
adapted and approved by all certification safe protects important data media against
authorities in Europe and the USA, and fire, heat, smoke and dust. The safe is gen-
they are manufactured in accordance with erous in size and is tested to satisfy the
“Gunnebo Physical Security’s Quality most stringent international safety stan-
Guidelines”, which also include ISO 9001 dards. The slam function secures that the
and ISO 14000. Substantial investments safe is being tightly shut even if the door is
were made during the year in various types slammed in an emergency. DataPlus+ is
of test equipment such as a new test fur- manufactured in five sizes, which enables it
naces and impact testing apparatus. The to satisfy customers’ individual storage
new programme of fire-resistant safes has capacity requirements.
been combined with the best test facilities
on the market to ensure that this segment products for automated banking service.
is successful on the market in 2004 and These products are characterised by a
thereafter. higher degree of complexity in terms of
technical content and demands for
Outlook 24/7 functionality, which will lead to
On the basis of its new, extensive product increased business opportunities for the
ranges, including the new fire resistant safes, division’s service units.
Gunnebo Physical Security will be able to SafePay, which was launched on
consolidate its market position in Europe the principal European markets during
and expand on the growing markets in the year, has healthy development
Eastern Europe - primarily Russia - and potential.
North America. The product mix will shift
away from traditional bank products to
21 Gunnebo Annual Report 2003
Gunnebo Integrated Security
GUNNEBO INTEGRATED SECURITY 2003 2002 2001
Invoiced sales, MSEK 2,133 2,100 1,804
Operating profit, MSEK* 183 143 88
Operating margin, %* 8.6 6.8 4.9
Return on operating capital, %* 29 22 13
Capital expenditure, MSEK 33 29 30
No. of employees 2,453 2,367 2,916
* before goodwill
Sales by product area Sales by market
s Electronic security, 47% s France, 43%
s Entrance control, 19% s Spain, 19%
s Access control, 17% s Great Britain, 11%
s Other, 17% s Indonesia, 6%
s Italy, 6%
s Other, 15%
Christian Selosse
Head of Gunnebo Integrated Security
Gunnebo Integrated Security
Operations in 2003 Ritzenthaler have developed well with
Gunnebo Integrated Security develops, Products and services good volume- and marginal improve-
manufactures, markets, sells and installs Integrated electronic security systems: ments. The development in Spain has
electronic security systems such as elec- burglar alarms, fire alarms, CCTV, been positive as well. The business with-
tronic burglar alarms, fire alarms and fire alarm monitoring centres, entrance in Gunnebo Entrance Control has also
protection equipment, CCTV, and and access control systems. had a very positive development.
entrance and access control systems. The Fire-extinguishing systems. Bullet-
division also has responsibility for a resistant glass walls and partitioning. Electronic security systems
number of alarm monitoring centres in Installation and service. earning healthy profitability
France, Spain, Portugal and Indonesia The profitability of the electronic security
that offer a full 24/7 service capability. Brand names business showed a further sharp improve-
Gunnebo Integrated Security com- Fichet-Bauche, Ritzenthaler, ment, mainly owing to a more customer-
bines expertise from risk management and Rosengrens Larm, Gunnebo Entrance focused organisation with tight cost con-
security auditing with the development Control, Gunnebo Mayor, Gunnebo trol, improved quality and a standardised
of customised integrated security solu- Metro, Gunnebo Italdis, Gunnebo product range.
tions – using state-of-the art technology. Omega, Armapod, CSI Security, Synergies resulting from the closer
As a supplier of systems or individual Hygiaphone, and SMC. coordination of the companies in the divi-
products, Gunnebo Integrated Security sion have increased markedly, especially in
can offer a variety of intelligent security electronic and mecatronic security solu-
solutions. Regardless of whether the cus- tions. Focused product development proj-
tomer prefers a complete system or an tems. The business is concentrated pri- ects have enabled the division to launch
individual product, it is important that marily in the Mediterranean countries several new products in both electronic
the solution provides satisfactory security and Continental Europe, where some 40 security and access control, including a
based on the perceived threats. per cent of its customers are banks or new version of the Arcana alarm system,
By using Internet-based control and other financial institutions. However, which has been installed at companies and
wireless communication for supervision there is a tendency for this dependence public institutions in Southern Europe.
and maintenance follow-up, customers on banks and financial institutions to Ritzenthaler’s new system for mobile,
are provided with modern security solu- decline in favour of logistics centres, fac- bullet-resistant walls, partitioning and secu-
tions with total control. tories, public institutions, casinos etc. rity booths, known as SkyRitz, was very
Gunnebo Integrated Security is one During the year, Gunnebo Integrated well received on the market. The bullet-
of the larger companies in Southern Security substantially increased its prof- resistant booths are installed using patented
Europe in electronic security and one of itability. In France, the business within profiles that permit flexible fencing-in of
the three largest in access control sys- Fichet Sécurité Electronic and various areas of open-plan offices.
22 Gunnebo Annual Report 2003
Gunnebo Integrated Security is one of the
leading suppliers of electronic security sys-
tems in Southern Europe. Key concepts are
production and integration of the best com-
ponents on the market, all selected to cre-
ate the optimal solution for each individual
customer.
Gunnebo Integrated Security
Ritzenthaler, one of Gunnebo Integrated
Security’s business units, manufactures
bullet-resistant glass walls and partition-
ing and develops its own proprietary soft-
ware. To deliver a complete security solu-
tion to the customer, Gunnebo Integrated
Security selects cameras, VDTs, and the
necessary IT equipment, integrates it all
into one system and installs it on the cus-
tomer’s premises. Advisory services,
operation and maintenance complement
the offer to make up a total solution.
23 Gunnebo Annual Report 2003
PasSec HS is a double, anti-reflow security booth
for passenger control. The double doors and the
corridor between them improve security as passen-
gers can transit from the arrivals hall to luggage
retrieval – but not vice versa. This system was
installed at Luleå’s Kallax airport in 2003. Gunnebo
Entrance Control received its first major order for
PasSec HS from Avinor, Norway’s civil aviation
authority, towards the end of the year.
Gunnebo Integrated Security
Moreover, new explosion-resistant doors Gunnebo Entrance Control has also division that commenced operations on
have been developed for high-risk facilities launched ImmSec, a unique barrier for 1 January 2004.
in the petrochemical industry. automated passport control with the aid of
Gunnebo Integrated Security has also facial recognition intended for use at air- Customers and competitors
continued with the development of a cus- ports and ports. The barrier combines two Gunnebo Integrated Security is the market
tomer-oriented, integrated security concept important requirements for current and leader in bank security in France and
for such users as airports, ports, private future passenger control – security and Spain. It also has a very strong position in
hospitals, public authorities, banks, indus- rapid movement of passengers. this market segment elsewhere in Southern
trial premises and the petrochemical indus- It took two years to develop ImmSec, Europe. Nowadays, buyers at banks and
try; the customer can rely on a single sup- which is based on various types of biomet- financial institutions, power stations, in the
plier for both installation and service of the ric recognition, including iris recognition, petrochemical industry, at airports and port
turn-key system. fingerprints, handprints, voice identifica- authorities, and at public authorities are
tion or facial scanning. Several major air- frequently engineers with broad IT compe-
Further strong progress by ports have shown interest in ImmSec since tence. Other key customer categories
Gunnebo Entrance Control it was launched in December 2003. Orders include architects and security consultants
Gunnebo Entrance Control is one of have already been signed for pilot installa- who are brought in at an early planning
Europe’s leading suppliers on the market tions in Germany and other countries. stage to ensure that the delivered facility
for access control systems. The business did has a comprehensive security system.
particularly well during the year in terms of Leader in Indonesia Another key group of customers con-
volume and profitability, with improved Gunnebo is one of the leading companies sists of public authorities with rigorous
productivity. on the market for integrated security serv- demands for reliable and cost-effective
A new system has been developed for ices in Indonesia, a country with a popula- security and entrance control systems in
airports that ensures secure movement tion of 220 million and a fast growing areas where large numbers of people are on
between arrival halls and baggage retrieval. security market. the move. All categories of customer are
Known as PasSec High Security, Gunnebo’s The business developed well during the canvassed direct by Gunnebo Integrated
new system provide secure anti-reflow sys- year with large fire protection contracts Security’s own sales companies or by
tem and more than satisfies the new EC being booked from the power industry as agents. Sales are also channelled through
directive on improved airport security. The well as contracts with several banks for retailers, wholesalers and specialist installers
first major order was signed towards the total security solutions. of alarms and security equipment.
end of the year with Avinor, Norway’s civil Gunnebo’s business in Indonesia pro- The largest competitors on the
aviation authority. vides a very useful platform and business European market are Tyco and United
model for Gunnebo Asia Pacific, the new Technology (acquired Britain’s Chubb
24 Gunnebo Annual Report 2003
Ritzenthaler has provided security for the Paris-Montparnasse office of La Poste,
France’s postal authority. The vaults are protected by SkyRitz walls that harmonise with
the building’s architecture. The office is also equipped with transfer safes from Haffner
and parcel and change hatches from Hygiaphone. In addition, the total installation is
connected to an alarm monitoring and response centre that is manned on a 24/7
basis.
Gunnebo Integrated Security
Security during the year) from the USA, integrated security solutions, and as a sup-
Siemens-Cerberus (German), and Securitas plier of after-market service through its
(Swedish). extensive network of service engineers and ImmSec – a unique barrier for automat-
On most European sub-markets there technicians. ed passport control, was launched in
2003 by Gunnebo Entrance Control.
are also numerous small, local companies Technically, Gunnebo Integrated
Using biometrics, in this case facial
that only canvass narrowly defined seg- Security is engaged in the further develop-
recognition, ImmSec can combine
ments of the market. ment of online security solutions, biomet- security with a rapid flow of passen-
rics, and systems for secure wireless com- gers, two features that are particularly
Outlook munication. important demands in the air traffic of
Gunnebo Integrated Security is active on a Gunnebo Integrated Security will con- today and tomorrow.
market showing annual growth of around solidate its position of leadership by con-
8-10 per cent – and its goal is to increase centrating on development within areas
its turnover at a faster rate than the market that will improve its customers’ productivi-
over the next few years. ty, and by engaging in the contract opera-
Future growth will be organic – above tion of large, comprehensive security sys-
all in the service segment – combined with tems.
further acquisitions of small or medium-
sized security companies in Northern and
Continental Europe.
By offering customers advanced and
reliable security solutions, Gunnebo
Integrated Security will strengthen its posi-
tion on existing markets and improve its
chances of breaking into new ones. The
focus of the division’s business development
involves intensifying efforts to exploit syn-
ergies between the various business units
with the object of being able to offer cus-
tomers turnkey security solutions. On sev-
eral markets, Gunnebo Integrated Security
is already recognised by customers as a one-
stop supplier of a comprehensive range of
25 Gunnebo Annual Report 2003
Gunnebo Perimeter Security
GUNNEBO PERIMETER PROTECTION / GUNNEBO TROAX
All activities relating to out- GUNNEBO PERIMETER SECURITY 2003 2002 2001
door and indoor perimeter
Invoiced sales, MSEK 1,038 1,091 1,103
security have been brought Operating profit, MSEK* 28 49 76
together within Gunnebo Operating margin, %* 2.7 4.5 6.9
Perimeter Security. This Return on operating capital, %* 6 10 15
division consists of two Capital expenditure, MSEK 31 29 26
business units: Gunnebo No. of employees 717 790 802
* before goodwill
Perimeter Protection and
Gunnebo Troax.
Sales by business unit Sales by market
s Gunnebo s Germany, 27%
Perimeter Protection, 59% s Sweden, 21%
s Gunnebo Troax, 41% s Denmark, 10%
s Great Britain, 10%
s France, 8%
s Norway, 6%
s Finland, 5%
s Switzerland, 5%
s Other, 8%
Gunnebo Perimeter Security
26 Gunnebo Annual Report 2003
GUNNEBO PERIMETER PROTECTION Gunnebo Perimeter Protection’s prod-
ucts for improved road safety also noted
Operations in 2003 solid growth, above all in Scandinavia. This
Gunnebo Perimeter Protection is one of product range, which includes everything
Northern Europe’s leading suppliers of from animal fencing to cable and crash
solutions for outdoor perimeter protection. barriers, also enjoys strong market potential
Gunnebo Perimeter Protection’s main elsewhere in Europe.
business idea is to plan, together with the Philip Mozes
customer, outdoor perimeter protection Head of Gunnebo Perimeter Protection SecuFix
that provides an optimal security solution, The launch of SecuFix - with up to 60 per
including manufacture, installation and cent shorter installation times - was very
after-market service. well received, especially on the German
The division covers the markets in Products and services market, where it was first launched. 2003
Sweden, Denmark, Norway (Gunnebo Outdoor perimeter protection and saw further market launches on other mar-
Protection), Finland (Polaraidat), the entrance control; gates and fences, kets in Northern Europe.
Netherlands (Alura), Germany, Switzerland and alarm systems. Products for road
and France (Wego) with its own sales safety.
organisations and resources for installation
and service, often complemented with a Brand names
network of subcontractors and strong, local Gunnebo Protection, Wego, Werra,
brand names. Alura, Polaraidat
Gunnebo Perimeter Security
Important customer segments in this
area include manufacturing industry,
defence establishments, ports and harbours,
airports, logistics centres, power stations Sales by product area
and telecommunication installations. Total: 600 MSEK
Price competition has been fierce, espe-
cially in Germany, which resulted in a
weak pattern of earnings at Gunnebo
Perimeter Protection last year. The market
in Sweden developed very favourably.
The market for outdoor perimeter pro-
tection is suffering from considerable excess
s System sales, 58%
capacity, which is causing depressed prices s Product sales, 38%
s Road safety, 4%
on most markets.
At the end of 2003, Gunnebo
Perimeter Protection drew up a strategic
Sales by market
plan. On the basis of this it was decided
Total: 600 MSEK
that Gunnebo Perimeter Protection should
play an active role in the consolidation of
the European perimeter protection market
by means of strategic acquisitions of select-
ed companies in the industry, followed by A specially ordered gate for the
a process of consolidation to improve prof- Copenhagen Zoo being manufactured at
itability. Gunnebo Perimeter Protection’s factory
s Germany, 38% in Varde, Denmark. The Zoo was com-
s Sweden, 23%
Market s Denmark, 13% pelled to replace an existing gate from
s The Netherlands, 7%
In 2003 the market, which has normally s Norway, 6%
1936 with a new motor-driven sliding
grown at 2-3 per cent a year, showed signs s Other, 13%
gate with microprocessor control and
of slackening, with demand falling espe- entrance control. The Zoo also wanted to
cially in the construction sector, although keep some of the hand-forged compo-
in the logistics and airport segments, where nents in the form of animals from the old
security levels are being upgraded, demand gate. Gunnebo Perimeter Protection
is still strong. therefore manufactured a modern sliding
gate that retained the design features
and components from 1936.
27 Gunnebo Annual Report 2003
EntraSec Competitors its priority product areas and on its priority
EntraSec, which is a new motor-driven The European market for outdoor perime- markets. This will be accomplished by
sliding gate with opening widths of up to ter protection is estimated to be worth offering customers innovative and cost-
10 metres, was launched at the beginning some MSEK 10,000. effective security systems for outdoor
of 2003. Its lightweight construction, Gunnebo Perimeter Protection is one perimeter protection.
mainly in aluminium, and low-friction of Northern Europe’s leading suppliers, Gunnebo Perimeter Protection will also
movement, give the product higher opera- with a market share of around 6 per cent intensify its efforts to offer complete, func-
tional reliability and a long service life. in Europe. It is the market leader by far in tion-tested products, together with installa-
EntraSec satisfies European safety standards the Nordic region, while in Germany, the tion in situ and after-market service.
and by virtue of its patented, modular business unit’s largest market, Gunnebo These specialised product concepts and
manufacturing concept, provides greater Wego is one of the leading suppliers. more efficient product sourcing will enable
simplicity and flexibility in product sourc- The main competitors on the the business unit to achieve higher growth
ing as well as lower transport and installa- European market with international cover- on existing as well as new markets.
tion costs. age are Bekaert Fencing, CRH Fencing and A comprehensive cost-reduction pro-
During the year, sales volumes devel- Security, Dirickx, Best Fencing Group and gramme for the production and market
oped well, and products to broaden the Elkosta. There are also numerous small, organisations has been launched as part of
product range have been launched. local competitors. the new strategic plan. It is expected to
EntraSec is now available for two gateway have its full effect towards the end of 2004.
Gunnebo Perimeter Security
widths, of 6-10 metres and 3-6 metres Outlook
respectively. Gunnebo Perimeter Protection’s vision is to
achieve a position of market leadership in
The EntraSec security gate was one of the new product launches in 2003. The photograph is from Rohwedder in Berlin. As the gate-
way is so wide, EntraSec, which is made of aluminium, was the ideal solution for the customer, who preferred a manual gate to an
electric one.
28 Gunnebo Annual Report 2003
GUNNEBO TROAX
Customers and competitors
Operations in 2003 Important customers in the automotive
Gunnebo Troax is Europe’s leading supplier and robotics industries during the year
of products for indoor perimeter security. were the PSA-group (Peugeot and Citroën)
in France, Caterpillar in England,
The business is organised into three areas of Volkswagen and BMW in Germany, and
application: Volvo Cars in Sweden.
• Automotive and robotics – consulting Stefan Andersson In the manufacturing segment, which
services and systems for machine security Head of Gunnebo Troax includes key customer groups in the ware-
• Security and safety systems for materials house and industrial walling segment, the
handling and transport flows, warehouses market stabilised at a lower level, the effect
and industrial walling, wire-mesh shelv- of which was to depress prices.
ing and stabilisers for pallet racking Products and services Most of the competitors are small, local
• Perimeter protection in the building Machine protection and indoor companies operating on geographically
industry - garage boxes and storage units perimeter protection for industry, confined markets, along with a few
warehouses, public environments and European competitors such as Axelent in
homes. Sweden.
Troax is the market leader in Europe in
indoor perimeter protection with 12 sales Brand names
companies. Troax, C Lee
In 2003, the result was unsatisfactory,
Gunnebo Perimeter Security
mainly owing to lower demand in the
building industry on the most important Sales by product area
markets, namely England, Sweden and Total: 438 MSEK
France, and to unfavourable currency
effects. The market for machine protection
has shown a more encouraging trend, with
major orders being booked from some of
Europe’s largest car manufacturers.
During the year, with the object of
reversing the declining earnings trend,
Troax was engaged on a cost-reduction and s Industrial automation, 34%
s Materials handling,
restructuring project that included stepping Logistics, 31%
s Perimeter protection,
up the rate of product development, a building industry, 28%
s Other, 7%
more rational flow-optimised production
layout at the factory in Hillerstorp, a new
organisation and significantly improved
logistical systems. In particular a new dis- Sales by market
tribution centre at Hillerstorp for the Total: 438 MSEK
European market has resulted in shorter
delivery times to end customers, improved
cost-efficiency and a higher standard of
service.
During the year, Troax invested in a
new production line at the Hillerstorp fac-
tory for fully automatic welding of coarse
wire-mesh sections. This investment also s Great Britain, 23%
s Sweden, 17%
resulted in improvements to the environ- s France, 13%
s Germany, 12%
ment at the plant as well as higher produc- s Switzerland, 8%
s Denmark, 6%
tivity. s Other, 23%
RapidFix is a flexible fastening system for
machine protection that is easy to mount
and dismantle, which saves time as well
as space in the workshop.
29 Gunnebo Annual Report 2003
In 2003, Troax invested in a new produc-
tion line at its Hillerstorp factory for the
manufacture of coarse wire-mesh sec-
tions for the building industry, machine
protection, warehouses and manufactur-
ing.
Outlook
Gunnebo Troax will continue to concen-
Gunnebo Perimeter Security
trate on customer-oriented system sales
with total solutions including service for
major customers, such as large multination-
al enterprises.
Completed investment projects will
lead to more rational and customer-orient-
ed production.
The more rational logistical systems
will further strengthen the company’s com-
Stabilisers prevent goods from falling off the back of pallet racking shelves. This petitive position.
system has been installed at catering and restaurant supplies wholesaler Troax’s modernised and lighter product
Servera’s warehouse in Norrköping. The shelves were also supplied by Troax. programme – SafeLite – which will facili-
tate quicker and more efficient final assem-
bly, has been successfully launched on the
market.
At the beginning of 2003, Gunnebo
Troax launched RapidFix, an entirely new
mounting system for its welded panels.
RapidFix, which satisfies all European safe-
ty standards, has considerable market
potential, especially in the automotive and
robotics industries.
The main advantages are that machine
protection can be installed closer to the
robots, which permits more efficient use of
space and reduces assembly and dismount-
ing times in the event of planned or
unplanned production downtime.
Machine protection is Troax’s largest product segment. In 2003 half a kilometre of
SafeFix machine protection was installed at SCA’s modern mill in Värnamo, Sweden.
30 Gunnebo Annual Report 2003
Gunnebo Perimeter Security
Gunnebo Steelage
GUNNEBO STEELAGE 2003 2002 2001
Invoiced sales, MSEK 112 124 113
Operating profit, MSEK* 6 5 1
Operating margin, %* 5.4 4.0 0.9
Return on operating capital, %* 7 7 2
Capital expenditure, MSEK 8 2 8
No. of employees 1,101 1,151 1,267
* before goodwill
Sales by product area Sales by market
s Physical Security, 52% s India, 100%
s Minimax, 23%
s Projects, 25%
Deepak Khetrapal
Head of Gunnebo Steelage
Fr.o.m. 1 januari 2004 Chef Gunnebo Asia Pacific
Gunnebo Steelage
Products and services
High-graded burglar- and fire-resist-
ant safes. Security products for banks:
safety deposit boxes, bank vaults and
vault doors; products for banking
automation. Fire-resistant safes for
data media. Fire-extinguishing equip-
ment, fire alarms. Perimeter protec-
tion, entrance control systems, access
control systems, CCTV. Installation
and service.
Brand names
Steelage, Minimax, Chubbsafes,
Gunnebo Perimeter Protection
Manufacturing of fire extinguishers at Gunnebo Steelage’s factory in Chennai, India.
Operations in 2003 ing systems and is well positioned on the invoiced sales declined by 10 per cent.
Gunnebo Steelage is India’s second largest Indian security market with its portable In 2003, Gunnebo Steelage continued
security company. It offers an extensive and mobile fire extinguishing equipment with the launch of its total security concept
range of security products and services. In and the installation of fire alarms and in India. Gunnebo Steelage, in co-opera-
physical security, Gunnebo Steelage devel- sprinklers. tion with Gunnebo’s other security divi-
ops, manufactures, markets and sells a The market is canvassed through 14 sions, has also begun to market entrance
broad range of high-graded, burglar- and sales offices and 70 retailers, which gives control systems, CCTV equipment, and
fire-resistant safes. Gunnebo Steelage a strong local presence. perimeter protection. Its co-operation with
Gunnebo Steelage is India’s leading Organic growth in 2003 was 4 per Gunnebo Physical Security, in particular,
supplier of fire alarms and fire-extinguish- cent. Translated into Swedish kronor offers great potential for product and
31 Gunnebo Annual Report 2003
In 2003, Gunnebo Steelage
launched a range of suspended fire
extinguishers, which improve safety
in locations where it is not possible
to install sprinkler systems.
design improvements, as well as introduc-
ing an entirely new range of products for
the banking sector.
Gunnebo Steelage conducts its business
through three business areas:
• Physical Security
• Minimax
• Projects
Physical Security
This business area currently accounts for
more than 50 per cent of Gunnebo
Steelage’s turnover, mainly through its pro-
duction of high-graded, fire- and burglar-
resistant safes. With some 30 per cent of
the market, Physical Security is the second
largest supplier of physical security prod-
ucts in India with a very strong position in
the banking segment.
Gunnebo Steelage has one main com-
petitor in this segment, Godrej, whose
market share is estimated at around 60 per
Gunnebo Steelage
cent.
The factory in Halol was enlarged and
modernised in 2003 with the object of
doubling production capacity and signifi-
cantly improving the quality level.
This investment gives Gunnebo
Steelage valuable competitive advantages in
India, while also enabling the factory to
supply other markets with competitive
security products.
Minimax
The Indian market for portable fire extin-
guishers is highly fragmented with numer- Ericsson had RevoSec revolving security doors installed at its office in New Delhi
ous local manufacturers that supply the in 2003. The order was won as a result of close co-operation between Gunnebo
market with low-price products. With its Integrated Security and Gunnebo Steelage.
well-known Minimax brand name,
Gunnebo Steelage is well placed for further
expansion.
Gunnebo Steelage is market leader with Gunnebo Steelage is one of the largest public sector making greater demands for
15 per cent of the market. A brand new suppliers of these systems and in 2003 it integrated security systems.
family of suspended fire extinguishers was completed delivery of numerous large Gunnebo’s accumulated competence in
launched during the year, designed primari- orders – including complete surveillance the different security sectors and its many
ly to increase fire safety in unmanned and fire-extinguishing systems for large years of experience of design and product
workplaces and at locations, such as railway power stations. development will accelerate the process of
coaches, where it is not possible to install transforming Gunnebo Steelage into a
sprinkler systems. Outlook modern and profitable security company.
Many segments of India’s security market Gunnebo Steelage has become a member of
Projects remain undeveloped and fragmented. The the new Gunnebo Asia Pacific division as
The fastest-growing segment of the security country’s infrastructure is currently under- of 1 January 2004.
market in India is the design and installa- going an extremely rapid development
tion of fire protection systems. process, with companies, banks, and the
32 Gunnebo Annual Report 2003
Gunnebo Asia Pacific
Sales by product area
Total: 350 MSEK
Sales companies
Factories
s Physical Security, 55% Jointly owned factory
s Fire protection systems, 35%
s Electronic security, 10% Countries with distributors
Gunnebo Asia Pacific
Sales by market
Total: 350 MSEK
s Indonesia, 40%
s India, 35%
s Australia, 15%
s Other, 10%
As of January 1, 2004, the Gunnebo Gunnebo Asia Pacific comprises the The product range consists primarily
Group has co-ordinated all of its Group’s security operations conducted of security products and services including
security-related operations in Asia through wholly owned subsidiaries in high-graded burglar- and fire-resistant
and Australia/New Zeeland in a India, Indonesia, Australia, Singapore and safes, security products for banks, burglar
new division – Gunnebo Asia China, a 30 per cent interest in Chubb and fire alarms, fire-extinguishing equip-
Pacific. Malaysia and some 30 distributors. ment, perimeter protection, entrance con-
Gunnebo Asia Pacific has an initial trol systems, access control systems, CCTV,
The region encompasses 26 countries, from 1,900 employees and an estimated annual alarm monitoring and response centres,
Pakistan in the west to Japan in the east. turnover of MSEK 350. and installation and service.
The total population of this rapidly The goal is to double turnover within Deepak Khetrapal, former president of
expanding region is around 3,500 million, three years via organic growth and strategic Gunnebo Steelage, has been appointed
and security has become a matter of grow- acquisitions. head of the Gunnebo Asia Pacific division.
ing concern during the past few years.
33 Gunnebo Annual Report 2003
Gunnebo Engineering
GUNNEBO ENGINEERING 2003 2002 2001
Invoiced sales, MSEK 1,144 1,166 1,206
Operating profit, MSEK* 87 81 86
Operating margin, %* 7.6 6.9 7.1
Return on operating capital, %* 12 11 12
Capital expenditure, MSEK 49 50 58
No of employees 1,121 1,054 1,096
* before goodwill
Sales by product area Sales by market
s Lifting, 59% s Sweden, 27%
s Fastening, 31% s USA, 15%
s Blocks, 10% s Finland, 8%
s Norway, 8%
s Great Britain, 7%
s Denmark, 4%
s Other, 31%
Christer Lenner
Head of Gunnebo Engineering
Gunnebo Engineering
Operations in 2003 During the year Tellesfdal A/S’ non-
Gunnebo Engineering’s business is conducted skid division was acquired. This acquisition
through the following business units: will complement other non-skid activities
• Gunnebo Lifting on the transport and agricultural markets
• Gunnebo Blocks and lead to an improvement in the market
• Gunnebo Fastening position in Norway, Canada and the USA.
The non-skid business within Gunnebo
Gunnebo Engineering is involved with well Lifting comprises an own business unit
known products in established market seg- Gunnebo Non Skid, as of January 1, 2004.
ments and is the leader in each product Gunnebo Engineering improved its
area. Demand for the division’s products operating result, mainly through further
was relatively weak during the year, rationalisation and greater cost efficiency.
although a slight recovery has been noted
in Asia, Australia and South America. In Gunnebo Lifting
the USA, by contrast, the market was weak. Gunnebo Lifting, which has some 20 per
In Europe markets were cautious but with cent of the global market, develops, manu-
demand changing for the better on the factures, markets and sells lifting products
Central and in Eastern Europe. for handling heavy goods, shackles and rig-
ging screws for marine use and chain-based
non-skid products. Production takes place
in Sweden, Norway, Finland, Poland and
Two new chain dimensions, 6 mm South Africa with sales going through 13
and 16 mm, will broaden subsidiaries and through external distribu-
Products and services
Gunnebo Lifting’s Grab IQ multi- tors to 80 or so markets in all parts of the
Products and systems for heavy lifting world.
function system, which consists of
such as chain, hooks, lifting slings Demand for Gunnebo’s lifting prod-
top components, chain and hooks
and blocks. Chain-based non-skid ucts was buoyant in Japan, Australia,
that can lift loads weighting from
products. Fastening systems. Brazil, as well as in England and the
1.5 tonnes to 21 tonnes in a
3-part lifting system.
Netherlands in Europe, although it was
Brand names weak elsewhere in Europe.
Gunnebo Lifting, Gunnebo Extensive investments were made,
Fastening, Gunnebo Johnson, Gemla mainly in the forge at Gemla, near Växjö
Mekanik, OFA, ANJA, Tellefsdal in Sweden. A new forging machine has
been installed which will enable the unit to
deliver a comprehensive range and has raise
34 Gunnebo Annual Report 2003
In the autumn of 2003 Gunnebo Lifting launched its new service business in Sweden.
Customers who sign service agreements with Gunnebo Lifting will have their equipment
tested and inspected to ensure it satisfies the Work Environment Authority’s require-
ments. The van is fitted with various items of test equipment and a small stock of prod-
ucts.
production capacity by 30 per cent. screws, hardened wooden screws and band-
Significant environmental improvements ed nails.
have also been made at the Gemla facility. During the year, heavy investments
Investments have been made in machi- were made in a new central warehouse at
nes at the Gunnebo chain factory in the the Polish factory in Orneta. Parallel to the
form of an entirely new line for the manu- enlargement the unit obtained quality,
facture of chain, together with further auto- environmental and work environment cer-
mation at the production plant in Ramnäs. tification. The programme will continue for
Product development in the business the coming two years and is intended to
unit was concentrated on further extending provide new capacity for sheet metal fas-
the GrabIQ system. tening.
The purchase of Tellefsdals’ non-skid Leading competitors are NKT in
division and the formation of the Gunnebo Denmark, Spigerverket in Norway and
Non Skid business unit will enhance our Pintos in Finland. Gunnebo Fastening’s
ability to canvass the large markets in products are dependent on the develop-
Scandinavia and North America. Following ment of the building market, which has
the acquisition, a complete range can be been weak in the nordic countries, while
offered to the markets in forestry, transport Central and Eastern Europe enjoyed steady
and farming. In its segments, Gunnebo growth.
Lifting is one of the largest suppliers in the
world. Major competitors include FKI in Outlook
England and Pewag/Weissenfels, which is Gunnebo Engineering is active in estab-
based in Austria/Italy. lished and mature sectors. By taking active
Gunnebo Engineering
measures to adjust costs, investing heavily,
Gunnebo Blocks and engaging in focused product develop-
Gunnebo Blocks develops, manufactures, ment, the division succeeded in improving
markets and sells heavy lifting systems, some its profitability in 2003.
of which are key components in materials In the event of an economic recovery
This sheave is part of a motion compensa-
handling systems while others are cus- that will lead to stronger demand for
tion system on an offshore platform for oil
tomised components for the OEM market. Gunnebo Engineering’s products, the divi-
exploration and drilling at sea. The wheel
Development and manufacture take sion can rapidly adapt to higher volumes,
was delivered to Shaffer, a division of
place at Gunnebo Blocks’ facility in Tulsa, which will enable it to achieve higher prof-
Varco International, in November 2003. It
Oklahoma, USA and most of its output is itability.
is 2.6 meters in diameter and uses wires
sold on the North American market.
that are 7.3 cm in diameter. The system
Gunnebo Blocks is a leader in systems
is capable of lifting up to 1,135 tonnes.
and components for very heavy lifting for
end users in the building, offshore and
other heavy industries. Among the larger
competitors are McKissick in the USA and
Ansel-Jones in England. Gunnebo Blocks’
products are intended for the capital goods
market, which was very slack in North
America during the year.
Gunnebo Fastening
Gunnebo Fastening, which is market leader
in Scandinavia, develops, manufactures,
markets and sells a variety of fastening sys-
tems mainly for the building market but
also for industrial purposes.
Production takes place in Sweden,
Finland and Poland with the output main-
ly destined for the North and East
European markets.
A shift in the market away from tradi-
tional nail products to other types of fas- Gunnebo Fastening’s range is stocked by the Jula chain of hardware stores at its newly built
teners has resulted in greater attention outlet in Uddevalla. Most of Gunnebo Fastening’s turnover comes from store sales.
being given to the range of plugs, façade Gunnebo also markets flat nails for any types of nail pistols on the market.
35 Gunnebo Annual Report 2003
Gunnebo’s employees
comply with the code of ethical conduct
that regulates the Group’s responsibility
towards its customers, employees, suppliers
and society at large. Gunnebo’s ethical rules
are based on the UN’s Global Compact
Principles and the OECD’s guidelines for
multinational enterprises.
In Europe, Gunnebo works closely
with the union organisations through the
Gunnebo of today is a global group Gunnebo European Works Council
(EWC). Apart from the main annual meet- ago. Gunnebo Academy provides training
with 8,100 employees, who work
ing, the EWC’s executive committee meets for existing and future managers that is
for 110 subsidiaries in 32 countries
representatives of Group management reg- intended to raise competence and stimulate
in all parts of the world.
ularly during the year. cross-divisional co-operation. In 2003, 40
Gunnebo’s highly decentralised
managers received training under the aegis
organisation enables the Group to
Competence development of Gunnebo Academy, and planning for
offer its employees a work environ-
Responsibility for the development and continuation courses that are more individ-
ment where they can develop and
professional training of Gunnebo’s employ- ual in character will start in 2004.
where their regular competence
ees is largely delegated to the divisions, In all, 150 managers have undergone
development is based on the cus-
business units and companies. As Gunnebo training with Gunnebo Academy.
tomers’ demands.
has a highly decentralised organisation,
responsibility and decision-making authori- Market conditions
International opportunities
Gunnebo has prepared a system for ensur-
Gunnebo’s Employees
Gunnebo’s global presence provides oppor- ty are delegated down the organisation in
many areas. This also means that many ing that personnel are employed on market
tunities for international contacts that are
employees are involved in making impor- conditions in the countries and markets
both stimulating and challenging for pres-
tant decisions, and also that tasks are where Gunnebo is active. Gunnebo is also
ent and potential employees.
becoming broader and more qualified. taking a proactive approach to succession
Gunnebo Asia Pacific, a new division
Parallel to this, the need for qualified planning to ensure that vacancies are filled
within Gunnebo that was formed on
managers with international experience is quickly and efficiently.
January 1, 2004, has responsibility for all
security-related business in this fast grow- becoming more marked in line with
Gunnebo’s rapid expansion. Unitech – recruitment for the
ing region. The division has been manned
In order to meet this need, the compa- long term
with personnel from Gunnebo Physical
ny started Gunnebo Academy two years Gunnebo has been involved for the past
Security and Gunnebo Integrated Security,
two years in Unitech, an association of
and the initial establishment is 1,900
technical institutions and prominent
employees. Gunnebo’s factory in Jakarta,
European enterprises, with the object of
Indonesia, which is managed by Gunnebo
offering students traineeships and giving
Sourcing and Production, a part of No. of employees by country
the companies opportunities to identify
Gunnebo Physical Security, is not included
and recruit the business leaders of tomor-
in the new division.
row. Among the companies associated with
s France, 1,156
s Indonesia, 1,118 Unitech are ABB, Mercedes-Benz, SKF and
Equality of opportunity and s India, 1,101
s Sweden, 950 Gunnebo. During the year, Gunnebo was
ethical rules s Germany, 541
s Spain, 480
able to offer six traineeships, I England,
Gunnebo’s attitude towards equality of s Great Britain & France, Germany and Sweden.
opportunity is reflected in the equal oppor- Ireland, 473
s The Netherlands, 278
tunities offered to men and women for s Other, 1,611
Advanced technology
employment, development and promotion
Many of Gunnebo’s companies make use of
and the fact that their pay should be Average no. of employees
advanced technology. The ability to main-
assessed equally, regardless of gender. In by gender
tain a high technical status, to absorb and
practice, this means that Gunnebo gives
apply new technical advances and turn
priority to attracting women onto its man- s Male, 85%
s Female, 15% them into successful business ideas is an
agement training courses. The long-term
important means of advancing our market
recruitment programme also focuses on
position. Gunnebo therefore works closely
attracting more female applicants with the
together with a number of universities and
object of achieving a better gender balance.
institutes of technology, both in Sweden
It is a demand within Gunnebo that all
and abroad.
companies, in their day-to-day activities,
36 Gunnebo Annual Report 2003
Gunnebo and the environment
Following the successful introduction of
the environmental management system,
the ISO 14001 team at Chubb Safes fac-
tory in Jakarta, Indonesia, celebrate the
award of their certificate by the British
Standards Institution.
Environmental activities tive and official requirements being the ual situation. Information and environ-
The overall goal of Gunnebo’s environ- minimum requirement mental training for all employees were key
mental activities is to contribute actively to • We shall give careful consideration to the elements in the introduction of the envi-
more sustainable use of limited natural environment in the development of new ronmental management system, which has
resources. products and manufacturing methods been examined and certificated by Lloyds
Gunnebo’s environmental policy pro- • We shall regularly endeavour to make Register of Quality Assurance.
vides guidelines for its environmental activ- more efficient use of resources and reduce In 2003, Gunnebo Industrier’s unit in
ities, and the Group’s overall environmen- the use of hazardous substances Orneta, Poland introduced management
tal goals ensure that these activities are • We shall adopt an open attitude towards systems for the environment, quality and
focused on areas where the need for im- the environment. the work environment. DNV has audited
provement is most needed. them and verified that they satisfy the
Gunnebo and the environment
A key tool for these activities is provided Environmental management and requirements of ISO 14001, ISO 9000 and
by the environmental management systems ISO 14001 OHSAS 18001.
introduced at the Group’s production units. The Gunnebo Environmental Manage- At Chubb Safes factory in Jakarta, the
Many of Gunnebo’s products have very ment System provides guidelines and pro- existing quality system was augmented dur-
long service lives, and their characteristics cedures for the environmental activities at ing the year with a management system
have been further improved by continuous and reporting by the various units. This that satisfies the requirements of ISO
development and quality activities. In com- Group-wide system includes the produc- 14001. This system was certificated by the
bination with the continuous development tion of an annual report on the environ- British Standards Institution in 2003.
of Gunnebo’s manufacturing processes to mental performance of each of the produc-
reduce emissions and energy consumption, tion units. Environmental objectives
and to increase recovery, this contributes to During the year, seven production The Gunnebo Group has established envi-
the achievement of the overall goals. units introduced environmental manage- ronmental objectives that stipulate the pri-
Capable and dedicated personnel are ment systems and had them certificated in ority areas in which we shall improve our
important in these environmental activi- accordance with the ISO 14001 interna- environmental performance. At local level,
ties. The environmental managers at the tional standard. these goals are broken down into detailed
manufacturing facilities belong to a net- Gunnebo’s goal is for all production targets adapted to local conditions. These
work set up for the sharing of experiences units in the Group to introduce environ- targets are to be achieved by taking suitable
and expertise. mental management systems that satisfy measures that are specified in formally
the requirements of ISO 14001. A well adopted action programmes.
Environmental policy functioning management system is a valu-
The activities of the Gunnebo Group shall able aid in the environmental activities by The following environmental objectives have
be characterised by a holistic approach in virtue of the need to identify the main been established:
which importance is given to environmen- environmental impact of each unit and • To minimise emissions into air of volatile
tal considerations. In our day-to-day activi- then to base environmental goals and organic substances.
ties, we shall foster good health, regularly action programmes on it. • To optimise the use of energy in our
improve our environmental activities, min- During the year, Gunnebo Industrier processes, buildings and the transporta-
imise the environmental impact of our completed a successful project for the tion of goods and people.
business, and make lean use of resources. introduction and certification of a com- • To make efficient (lean) use of raw mate-
mon environmental management system rials and natural resources.
This means that: for five production units in Sweden, name- • To maintain effective sorting-at-source
• We shall use information and training to ly Gemla, Gunnebo, Göteborg, Ramnäs and recycling of materials, so that we can
foster a responsible attitude towards the and Junsele. These units co-operate closely minimise the amount of waste that is not
environment on the part of all employees on the environment and have also intro- recovered.
• We shall base our environmental activi- duced procedures and instructions that are • To establish a strategy for product devel-
ties on challenging targets, with legisla- specifically designed for their own individ- opment that takes into account environ-
37 Gunnebo Annual Report 2003
Grazyna Skoog, a Lloyds audi- Anna Marciniec (right)
tor, and Bill Nelson, Gunnebo’s and Magda Mokot
service manager, examine the have been actively
heat recovery from the com- involved in Gunnebo
pressors at Gunnebo Baltic’s certification
Engineering’s nail factory in process.
Gunnebo.
mental aspects, such as energy consump- CO2 emissions in • At its Dutch unit in Deotinchem, it has
tion and the use of natural resources relation to turnover been installed new equipment for dealing
throughout each product’s total life cycle. with welding fumes. This will improve
Tonnes of CO2/MSEK
• To introduce at all production units envi- 15 the work environment and reduce emis-
ronmental management systems that sat- 12
sions into air.
isfy the ISO 14001 standard. • During the year, Gunnebo Industrier’s
9
plant in Gemla was extensively rebuilt,
The climate 6 including the entire forge, which has
Far-reaching measures are being taken to 3
enabled noise and vibrations from the
make more efficient use of energy and thus plant to be significantly reduced. In this
0
reduce emissions of CO2, as a means of 98 99 00 01 02* connection, a unit was installed to recov-
reducing Gunnebo’s contribution to the *Figures for 2003 are published in mid 2004. er heat from the furnaces for heating the
greenhouse effect. In recent years, emis- premises in the winter.
sions have been reduced relative to the size • In 2003, Gunnebo Industrier’s unit in
of the business as a result of modifications Environmental projects Gunnebo launched a comprehensive
to production equipment and buildings, Active environmental measures also require review of its energy consumption. The
improvements to transport efficiency and concrete action to reduce the environmen- review will be completed in 2004.
rationalisation of business travel. tal impact of the business, in the form, say, • The factory in Bazancourt, France has
By way of example, measures to reduce of investments in cleaning equipment, or installed a new heating system that will
Gunnebo and the environment
travel include greater use of video-confer- changes in the use of raw materials, energy reduce the unit’s energy consumption.
encing. Properly used, this type of meeting and other resources. The equipment for fire tests has been
saves both time and money, as well as help- During the year, several environmental supplemented with a post-burn chamber
ing to reduce the effect on the climate and projects were carried out by the units with- to reduce emissions into air. The
the use of resources. in the Group. The following section Bazancourt unit has also commissioned a
describes some of the completed projects. buffer tank for recirculation of process
Folksam’s Climate Index • At the factory in Mora, emissions of water so that it can be re-used in the
Gunnebo has participated for some years in hydrocarbons were reduced by investing cleaning processes.
evaluations of the environmental perform- in equipment that can use pigments with • Gunnebo Troax has installed a unit at
ance of the production facilities, both in a lower solvent content. Emissions from Hillerstorp for recovering heat from com-
Sweden and abroad, of listed Swedish com- the factory have declined by around 25 pressors and also commissioned a new
panies. per cent at an unchanged production vol- energy control system to regulate the
Folksam’s Climate Index is based on ume. maximum power taken from the facility.
each company’s total emissions of CO2 and • At the unit in Granollers, Spain, a new • At the factory in Markersdorf, diesel-
the measures taken to minimise emissions. drying furnace was commissioned during engined forklift trucks have been replaced
In the latest evaluation, Gunnebo was the year. The new equipment will help to by electric ones. This will improve the work
ranked as “Excellent” for its measures on reduce emissions of volatile organic sub- environment and reduce consumption of
the climate and the quality of its response. stances (solvents). fossil fuels and emissions of carbon dioxide.
Units in Sweden that are required to have a permit or submit reports
The table below shows the Swedish units that are covered by the demand to have a permit or submit reports.
Environmental impact takes the form of
Statutory Emissions Emissions Chemical Residual
Company obligation into air into water Noise products products
Gunnebo Industrier AB, Gunnebo Licence • • • • •
Gunnebo Industrier AB, Ramnäs Report • •
Gunnebo Industrier AB, Gemla Licence • • •
Gunnebo Industrier AB, Junsele Licence • •
Gunnebo Troax AB, Hillerstorp Licence • • •
Gunnebo Protection AB, Ödeborg Report • • •
Rosengrens Produktions AB, Mora Licence • • •
Rosengrens Produktions AB, Malung Licence • • • •
All of these units have the necessary permits or have submitted reports to the respective supervisory authority.
38 Gunnebo Annual Report 2003
Consolidated income statement
MSEK MSEK MEUR 1)
MEUR 2)
Notes 2003 2002 2003 2002
Invoiced sales 1 6,961.1 6,975.5 763.3 761.5
Cost of goods sold –4,679.9 –4,737.9 –513.2 –517.2
Gross operating profit 2,281.2 2,237.6 250.1 244.3
Selling costs –1,104.5 –1,100.4 –121.0 –120.1
Administrative costs 2, 26 –805.8 –835.9 –88.4 –91.3
Other operating income 3 24.6 59.6 2.7 6.5
Interest in earnings of associated companies 3.6 0.5 0.4 0.0
–1,882.1 –1,876.2 –206.3 –204.9
Operating income 1, 4, 22 399.1 361.4 43.8 39.4
Financial income and costs
Interest income 5.8 11.2 0.6 1.2
Interest costs –61.7 –90.5 –6.8 –9.9
Other financial income 9.1 10.0 1.0 1.1
Other financial costs –11.3 –11.9 –1.2 –1.2
Consolidated income statement
–58.1 –81.2 –6.4 –8.8
Profit after financial items 341.0 280.2 37.4 30.6
Taxes 5 –79.8 –51.4 –8.7 –5.6
Minority interest 6 –1.4 –0.3 –0.2 0.0
Net profit for the year 259.8 228.5 28.5 25.0
Earnings per share, SEK 7 12.00 10.75 1.32 1.17
Earnings per share after dilution, SEK 7 11.95 10.55 1.31 1.15
1)
1 EUR = 9.12 SEK
2)
1 EUR = 9.16 SEK
39 Gunnebo Annual Report 2003
Consolidated balance sheet
MSEK MSEK MEUR 1)
MEUR 2)
ASSETS Notes 31 Dec. 2003 31 Dec. 2002 31 Dec. 2003 31 Dec. 2002
Fixed assets
Intangible fixed assets
Goodwill 8 958.8 992.2 105.4 108.0
Other intangible fixed assets 8 89.6 57.3 9.9 6.2
Total intangible fixed assets 1,048.4 1,049.5 115.3 114.2
Tangible fixed assets
Buildings and land 9 473.8 510.5 52.2 55.5
Machinery and plant 9 345.5 353.0 38.0 38.4
Equipment, tools, fixtures and fittings 9 131.9 129.2 14.5 14.1
Fixed assets under construction 9 59.4 48.1 6.5 5.3
Total tangible fixed assets 1,010.6 1,040.8 111.2 113.3
Financial fixed assets 11 81.2 130.9 8.9 14.2
Total fixed assets 2,140.2 2,221.2 235.4 241.7
Current assets
Consolidated balance sheet
Inventories 12 1,060.5 1,090.2 116.7 118.6
Operating receivables
Accounts receivable 1,403.3 1,535.9 154.3 167.1
Tax receivables 22.3 26.8 2.5 2.9
Other current receivables 144.3 122.6 15.9 13.4
Prepaid costs and accrued income 13 98.2 75.1 10.8 8.2
Total operating receivables 1,668.1 1,760.4 183.5 191.6
Cash and bank 221.2 362.3 24.3 39.4
Total current assets 2,949.8 3,212.9 324.5 349.6
TOTAL ASSETS 5,090.0 5,434.1 559.9 591.3
1)
1 EUR = 9.09 SEK
2)
1 EUR = 9.19 SEK
These brand names represent a major proportion of the Group’s intangible fixed assets.
40 Gunnebo Annual Report 2003
MSEK MSEK MEUR 1)
MEUR 2)
EQUITY AND LIABILITIES Notes 31 Dec. 2003 31 Dec. 2002 31 Dec. 2003 31 Dec. 2002
Equity 14
Restricted equity
Share capital 218.9 212.1 24.1 23.1
Restricted reserves 561.7 469.6 61.8 51.1
780.6 681.7 85.9 74.2
Non-restricted equity
Non-restricted reserves 829.7 736.3 91.3 80.0
Net profit for the year 259.8 228.5 28.5 25.0
1,089.5 964.8 119.8 105.0
Total equity 1,870.1 1,646.5 205.7 179.2
Minority interest 5.9 6.1 0.6 0.7
Provisions
Pension provisions 15, 21 176.3 204.1 19.3 22.2
Deferred tax liability 5 49.7 41.8 5.5 4.6
Other provisions 16 159.6 292.2 17.6 31.7
Total provisions 385.6 538.1 42.4 58.5
Consolidated balance sheet
Interest-bearing liabilities 17
Overdraft facilities 25.2 49.3 2.8 5.4
Liabilities to credit institutions 20 1,339.6 1,610.3 147.3 175.2
Convertible loan 18 – 93.2 0.0 10.1
Total interest-bearing liabilities 1,364.8 1,752.8 150.1 190.7
Interest-free liabilities
Liabilities to suppliers 756.2 801.5 83.3 87.2
Other current liabilities 253.5 214.9 27.9 23.4
Accrued costs and deferred income 19 453.9 474.2 49.9 51.6
Total interest-free liabilities 1,463.6 1,490.6 161.1 162.2
TOTAL EQUITY AND LIABILITIES 5,090.0 5,434.1 559.9 591.3
Pledged assets 20 50.3 67.5 5.5 7.3
Contingent liabilities 21 308.8 155.1 34.0 16.9
MSEK MSEK MEUR 1)
MEUR 2)
CHANGE IN CONSOLIDATED EQUITY 31 Dec. 2003 31 Dec. 2002 31 Dec. 2003 31 Dec. 2002
Equity
Opening equity 1,646.5 1,513.4 179.2 162.7
Currency differences –32.9 –22.0 –1.6 –0.5
Net profit for the year 259.8 228.5 28.5 25.0
Dividend –84.8 –74.2 –9.3 –8.1
Conversion of convertible loan 81.5 0.8 8.9 0.1
Closing equity 1,870.1 1,646.5 205.7 179.2
1)
1 EUR = 9.09 SEK
2)
1 EUR = 9.19 SEK
41 Gunnebo Annual Report 2003
Consolidated cash flow analysis
MSEK MSEK MEUR 1)
MEUR 2)
Notes 2003 2002 2003 2002
CURRENT OPERATIONS
Operating profit 399.1 360.9 43.8 39.4
Depreciation charged against the result 227.5 228.9 24.9 25.0
Capital losses/gains –1.1 1.1 –0.1 0.1
Other items not affecting cash flow 3.6 – 0.4 –
Change in provisions –134.8 –54.5 –14.8 –5.9
Net financial items affecting cash flow 23 –83.5 –92.4 –9.2 –10.1
Dividends from associate companies 3.3 – 0.4 –
Paid taxes –54.0 –50.5 –5.9 –5.5
Cash flow from current operations
before changes in working capital 360.1 393.5 39.5 43.0
Cash flow from changes in working capital
Change in inventories 9.8 95.2 1.1 10.4
Change in operating receivables 121.5 29.5 13.3 3.2
Change in interest-free liabilities –26.1 –56.2 –2.9 –6.2
Total change in working capital 105.2 68.5 11.5 7.4
Consolidated cash flow analysis
Cash flow from current operations 465.3 462.0 51.0 50.4
INVESTMENT ACTIVITIES
Fixed capital expenditure 8, 9 –197.7 –168.0 –21.7 –18.4
Sales of fixed assets 8.0 7.4 0.9 0.8
Acquisition of subsidiaries 24 –56.4 –65.2 –6.2 –7.1
Cash flow from investment activities –246.1 –225.8 –27.0 –24.7
FINANCING ACTIVITIES
Change in interest-bearing receivables 2.2 –1.9 0.2 –0.2
Change in interest-bearing liabilities –262.6 –84.6 –28.7 –9.2
Dividend –84.8 –74.2 –9.3 –8.1
Cash flow from financing activities –345.2 –160.7 –37.8 –17.5
Cash flow for the year –126.0 75.5 –13.8 8.2
Opening liquid funds 362.3 294.6 39.4 31.8
Translation differences on liquid funds –15.1 –7.8 –1.3 –0.6
Closing liquid funds 221.2 362.3 24.3 39.4
1)
1 EUR = 9.12 SEK
2)
1 EUR = 9.16 SEK
42 Gunnebo Annual Report 2003
Parent company income statement
MSEK MSEK MEUR 1)
MEUR 2)
Notes 2003 2002 2003 2002
Invoiced sales 27 17.5 13.7 1.9 1.5
Administrative costs 26 –63.9 –50.2 –7.0 –5.5
Operating loss 4, 22 –46.4 –36.5 –5.1 –4.0
Financial income and costs
Anticipated dividends from Group companies 161.4 20.0 17.7 2.2
Write-down of shares in Group companies 10 –125.2 –0.1 –13.7 0.0
Group contributions received 48.6 52.8 5.3 5.7
Group contributions paid –17.3 –3.2 –1.9 –0.4
Interest income from Group companies 9.1 12.5 1.0 1.4
Other interest income – 1.4 0.0 0.2
Interest costs to Group companies –56.9 –66.0 –6.2 –7.2
Other interest costs –2.1 –10.2 –0.2 –1.1
Other financial income 39.8 37.2 4.4 4.1
Other financial costs –3.2 –3.7 –0.4 –0.4
54.2 40.7 6.0 4.5
Parent company income statement
Profit before tax 7.8 4.2 0.9 0.5
Taxes 5 – – – –
Net profit for the year 7.8 4.2 0.9 0.5
1)
1 EUR = 9.12 SEK
2)
1 EUR = 9.16 SEK
43 Gunnebo Annual Report 2003
Parent company balance sheet
MSEK MSEK MEUR 1)
MEUR 2)
ASSETS Notes 31 Dec. 2003 31 Dec. 2002 31 Dec. 2003 31 Dec. 2002
Fixed assets
Tangible fixed assets
Equipment 9 3.6 1.5 0.4 0.2
Total tangible fixed assets 3.6 1.5 0.4 0.2
Financial fixed assets
Shares in Group companies 10 2,726.4 2,832.5 300.0 308.2
Other securities held as fixed assets 11 9.3 – 1.0 0.0
Total financial fixed assets 2,735.7 2,832.5 301.0 308.2
Total fixed assets 2,739.3 2,834.0 301.4 308.4
Current assets
Operating receivables
Accounts receivable 0.3 – 0.0 –
Receivable from Group companies 33.9 47.0 3.6 5.1
Other current receivables 2.3 13.7 0.3 1.5
Parent company balance sheet
Prepaid costs and accrued income 13 36.3 24.2 4.0 2.6
Total operating receivables 72.8 84.9 7.9 9.2
Cash and bank 0.5 69.6 0.1 7.6
Total current assets 73.3 154.5 8.0 16.8
TOTAL ASSETS 2,812.6 2,988.5 309.4 325.2
1)
1 EUR = 9.09 SEK
2)
1 EUR = 9.19 SEK
44 Gunnebo Annual Report 2003
MSEK MSEK MEUR 1)
MEUR 2)
EQUITY AND LIABILITIES Notes 31 Dec. 2003 31 Dec. 2002 31 Dec. 2003 31 Dec. 2002
Equity 14
Restricted equity
Share capital (21,889,974 shares each having
a par value of SEK 10) 218.9 212.1 24.1 23.1
Share premium reserve 214.0 139.3 23.5 15.2
Legal reserve 320.0 320.0 35.2 34.8
752.9 671.4 82.8 73.1
Non-restricted equity
Retained earnings 454.3 534.9 50.0 58.2
Net profit for the year 7.8 4.2 0.9 0.5
462.1 539.1 50.9 58.7
Total equity 1,215.0 1,210.5 133.7 131.8
Interest-bearing liabilities 17
Liabilities to Group companies 1,528.0 1,563.4 168.0 170.1
Overdraft facilities 6.9 34.7 0.8 3.8
Liabilities to credit institutions – 50.0 – 5.4
Parent company balance sheet
Convertible loan 18 – 93.2 – 10.1
Total interest-bearing liabilities 1,534.9 1,741.3 168.8 189.4
Interest-free liabilities
Liabilities to suppliers 7.4 3.5 0.8 0.4
Liabilities to Group companies 42.6 21.8 4.7 2.4
Other current liabilities 2.5 0.6 0.3 0.1
Accrued costs and deferred income 19 10.2 10.8 1.1 1.1
Total interest-free liabilities 62.7 36.7 6.9 4.0
TOTAL EQUITY AND LIABILITIES 2,812.6 2,988.5 309.4 325.2
Pledged assets None None None None
Contingent liabilities 21 1,472.5 1,671.2 162.0 181.8
MSEK MSEK MEUR 1)
MEUR 2)
CHANGE IN PARENT COMPANY EQUITY 31 Dec. 2003 31 Dec. 2002 31 Dec. 2003 31 Dec. 2002
Equity
Opening balance 1,210.5 1,279.7 131.8 137.6
Currency differences – – 1.4 1.7
Net profit for the year 7.8 4.2 0.9 0.5
Dividend –84.8 –74.2 –9.3 –8.1
Conversion of convertible loan 81.5 0.8 8.9 0.1
Closing equity 1,215.0 1,210.5 133.7 131.8
1)
1 EUR = 9.09 SEK
2)
1 EUR = 9.19 SEK
45 Gunnebo Annual Report 2003
Parent company cash flow analysis
MSEK MSEK MEUR 1)
MEUR 2)
MSEK Notes 2003 2002 2003 2002
CURRENT OPERATIONS
Operating loss –46.4 –36.5 –5.1 –4.0
Depreciation charged against the result 0.7 0.2 0.1 0.0
Net financial items affecting cash flow 23 –12.0 –31.9 –1.3 –3.4
Paid taxes – – – –
Cash flow from current operations
before changes in working capital –57.7 –68.2 –6.3 –7.4
Cash flow from changes in working capital
Change in operating receivables 27.9 14.6 3.0 1.6
Change in interest-free liabilities 8.7 28.9 1.0 3.1
Total change in working capital 36.6 43.5 4.0 4.7
Cash flow from current operations –21.1 –24.7 –2.3 –2.7
INVESTMENT ACTIVITIES
Fixed capital expenditure 9 –2.9 –0.9 –0.3 –0.1
Parent company cash flow analysis
Sales of fixed assets 0.1 – 0.0 –
Investments in shares in Group companies 10 –18.9 –15.8 –2.1 –1.7
Investments in securities held as fixed assets 11 –9.3 – –1.0 0.0
Cash flow from investment activities –31.0 –16.7 –3.4 –1.8
FINANCING ACTIVITIES
Change in interest-bearing liabilities 67.8 161.5 7.4 17.6
Dividend –84.8 –74.2 –9.3 –8.1
Cash flow from financing activities –17.0 87.3 –1.9 9.5
Cash flow for the year –69.1 45.9 –7.6 5.0
Opening liquid funds 69.6 23.7 7.6 2.5
Translation differences on liquid funds – – 0.1 0.1
Closing liquid funds 0.5 69.6 0.1 7.6
1)
1 EUR = 9.12 SEK
2)
1 EUR = 9.16 SEK
46 Gunnebo Annual Report 2003
Accounting principles
Accounting and valuation principles Accounting treatment of effects into account.
The annual report is made up in accor- associate companies In certain cases, interest swaps are
dance with the Annual Accounts Act and Companies that are not subsidiaries but in arranged as a means of protecting the
comply with the recommendations and which Gunnebo owns at least 20 % of the Group against changes in interest rates.
statements of the Swedish Financial votes or otherwise exerts a significant influ- Differences in rates to be received or paid,
Accounting Standards Council. ence are stated as associate companies. if any, on account of an interest swap are
A number of new recommendations Shareholdings in associate companies are stated as interest income of interest costs
issued by the Council came into effect in stated using the equity interest method. This and periodised over the term of the swap
2003. However, their introduction did not means that the acquisition cost of shares, agreement.
lead to any effect on the stated result or on increased or reduced to take into account the
equity. As of 2003, depreciation of goodwill Group’s interest in the associate company’s Inventories
is stated among selling costs. In the past, it result, is stated in the consolidated balance Inventories are valued at the lower of acqui-
was stated on a separate row in the income sheet, under financial fixed assets, after sition value and actual value in accordance
statement. Items disturbing comparability deduction of depreciation of goodwill and with the first-in first-out principle. The
are not stated on a separate row as of 2003. dividend received. value of inventories includes an attributable
In comparisons, the figures for 2002 have The interest in the earnings of associate share of indirect costs. Inventories are stated
been adjusted for purposes of comparability. companies is stated in the income statement net after necessary deductions for obsoles-
The parent company’s figures for 2002 at two levels: cence and internal profits.
in the comparison have also been adjusted • The interest in the pre-tax profit is stated Major projects of long duration on
to improve comparability. in the operating profit in the consolidated behalf of outside parties are recognised in
income statement income on the basis of the degree of com-
Principles of consolidation • The interest in the associate companies’ pletion, which is determined by comparing
The consolidated financial statements relate tax according to the full tax method is costs incurred on the closing date with the
to Gunnebo AB and those companies in stated in the consolidated tax cost estimated total cost.
which the company directly or indirectly
Redovisningsprinciper
owns shares controlling more than 50 % of Intra-Group pricing Income tax
the votes, of over which the company exer- Deliveries of goods and services between The stated income tax comprises tax that is
cises control in some other way. companies in the Group are priced on to be paid or received for the financial year
The consolidated financial statements are arms’-length principles. in question, adjustments to previous years’
made up in accordance with the purchase taxes, changes in deferred tax, and interests
method, whereby the consolidated equity Transactions with related parties in the tax of associate companies.
includes the parent company’s equity and Transactions with related parties are priced All tax liabilities and receivables are val-
subsidiary companies’ equity generated after on arms’-length principles. ued at nominal amounts in accordance with
acquisition dates. The difference between the tax rules and at the tax rates that have
the acquisition value of shares in subsidiary Receivables and liabilities in been decided or, if announced, will almost
companies and the market value at the time foreign currencies certainly be approved.
of acquisition of the assets and liabilities in Receivables and liabilities in foreign curren- Tax effects relating to items in the
the subsidiaries is stated as goodwill. When cies are valued at closing date exchange income statement are also stated in the
deemed necessary in connection with the rates. If currency flows have been hedged, income statement. The tax effects of items
acquisition analysis, a transfer to reserve is the exchange rate in the forward contract is taken direct against equity are stated against
made to cover future restructuring costs. used for valuing the underlying receivable equity.
or liability. Deferred tax is calculated as the differ-
Translation of accounts of foreign ence between the value for tax purposes and
subsidiaries Accounting treatment of financial the stated value of assets and liabilities
The accounts of foreign companies includ- instruments - hedges (temporary differences), and also taking loss
ed in the consolidated financial statements For hedging of future currency flows, cur- allowances into account.
are translated using the quoted rate rency differences on hedging transactions Deferred tax is also calculated on the
method, whereby all the assets and liabili- are stated in the same period as the under- basis of the unrealised result of loans and
ties of subsidiaries are translated into lying flow. Any hedging premiums/dis- forward contracts entered into to hedge the
Swedish kronor at closing date rates and all counts are treated in the same way as inter- net assets of foreign subsidiaries (equity
income statement items are translated at est and periodised and stated under net hedges). Changes in this item are taken
average rates for the year. Translation differ- interest. direct to equity.
ences arising are taken direct to equity and To reduce the Group’s currency expo- Deferred tax receivables are stated only
do not affect the year’s result. sure, the net assets of foreign subsidiaries if there is believed to be a high probability
are hedged by loans or forward contracts in that the amounts will be utilised against
Minority interests the corresponding foreign currency. In the taxable profits within the near future.
In the consolidated income statement, consolidated financial statements, currency
minority interests are stated in the consoli- differences on the loans are eliminated and Pension commitments
dated net profit. Minority interests in the netted off against the translation differences Provisions for pensions are calculated in
equity of subsidiaries are stated in a separate arising in connection with the translation of accordance with local laws and regulations.
item in the consolidated balance sheet. foreign companies’ net assets, taking tax
47 Gunnebo Annual Report 2003
The Group’s companies have different the cost. Other software of a standard char- The Group has entered into certain finan-
pension systems based on local conditions acter is stated as a cost. Capitalised expendi- cial leasing agreements in respect of compa-
and practice in those countries in which ture on acquired software is depreciated lin- ny cars, copying machines, etc., which, in
they operate. The pension systems are nor- early over its service life. view of their limited effect, are stated as
mally financed by means of payments to operational leasing.
insurance companies, pension funds or by Tangible fixed assets
internal provisions based on actuarial calcu- Tangible fixed assets are stated at acquisi- Cost of borrowing
lations. All deficits or supplementary bene- tion value less depreciation. The acquisition Borrowing costs in the form of interest are
fits that require additional financing are value includes costs directly attributable to charged against the result on a regular basis
financed by means of payments or provi- bringing the asset to the location and into as and when they are incurred.
sions spread over a period that does not the condition required for it to be used for Front-end costs associated with the rais-
exceed the expected remaining working its intended purpose. ing of long-term loans are periodised over
time of the employees covered by the system. Expenditure on improving its perform- the term of the loan agreement.
ance over and above the original level will
Provisions increase the stated value. Expenditure on
Liabilities that are uncertain in terms of repairs and/or maintenance are stated as Cash flow analysis
amount or when they will be settled are operating cost. The cash flow analysis is made up using the
stated as other provisions. Provisions to indirect method. The stated cash flow only
cover guarantee costs are based on previous Depreciation includes transactions that involve disburse-
years’ guarantee costs. Depreciation according to plan is based on ments or receipts of cash. All transactions
the original acquisition value of the assets involving foreign subsidiaries are stated
Accounting treatment of revenue and is provided over the estimated after translation at average exchange rates
Revenue from the sale of goods and services economic lives. for the year. Acquisitions or sales of sub-
is booked when an agreement has been sidiaries are included net under Investment
reached with a customer and the products The following depreciation periods are used: activities and do not affect the cash flow
Accounting principles
have been delivered or the services provided Vehicles 5 years from operations. Liquid funds consist of
and when all significant risks have passed to Computers 3-5 years cash and bank deposits.
the customer. Other equipment and plant 5-15 years
Sales are stated net after value added tax Buildings and land 20-50 years Employee stock options
(VAT), discounts, returns and freight. Goodwill 5-20 years Social security charges that may arise on the
Other intangible fixed assets 3-5 years Group’s employee stock option plans are
Other operating income matched when the options are exercised in
Other operating income mainly comprises Goodwill is depreciated over 20 years in the the income statement by corresponding
income in the form of royalties, rent, capi- case of strategic acquisitions with strong gains on the hedging agreements with the
tal gains on sales of fixed assets, and curren- brand names and when the benefit is esti- credit institution. An accrued cost is stated
cy gains on receivables and liabilities that mated to be at least 20 years. Goodwill aris- in the balance sheet in respect of social
are operational in character. ing on other acquisitions is depreciated over security charges together with a correspon-
5-10 years. Depreciation of goodwill is stat- ding accrued income item.
Product development costs ed in the income statement under selling
Expenditure on development projects is costs. Reporting by segment
capitalised under intangible fixed assets to Lines of business include products or serv-
the extent it is expected to generate finan- Write-downs ices that are exposed to risks and generate
cial benefits in the future. When there is an indication that the value types of income that differ from those of
Other product development costs are of an asset has declined, an assessment is other lines of business. Geographical mar-
taken into the income statement when they made of the asset’s recoverable value. In kets provide products and/or services within
are incurred and are stated under Cost of cases where the book value of the asset specific economic environments that are
goods sold. Development costs previously exceeds its estimated recoverable value, the subject to risks and earn income of types
stated as costs in the income statement are value of the asset is written down to its that differ from those of units located in
not capitalised in later periods. recoverable value. other economic environments.
Capitalised development costs are depre- In the Group, lines of business are classi-
ciated linearly over the period during which Leasing fied as primary segments and geographical
the estimated benefits are expected to When a leasing agreement means that the areas as secondary segments.
accrue to the company and from the start financial benefits is passed on to the Group,
of commercial production. as the lessee, and the Group bears all the
economic risks attributable to the leased
Acquired software object ( financial leasing), the object is stat-
Expenditure on software that has been ed as a fixed asset in the consolidated bal-
developed or extensively modified on behalf ance sheet. The corresponding undertaking
of the Group, is capitalised as an intangible to pay leasing charges in the future is stated
fixed asset if the software is likely after one as a liability.
year to have financial benefits in excess of
48 Gunnebo Annual Report 2003
Notes
(Amounts in MSEK except where otherwise stated)
NOTE 1 Reporting by segment
Primary segments – lines of business
Gunnebo Gunnebo Gunnebo Non-allocated Total Non-allocated
Physical Integrated Perimeter Gunnebo items and Gunnebo Gunnebo items and Total
2003 Security Security Security Steelage eliminations Security Engineering eliminations Group
Income
External sales 2,564 2,119 1,022 112 – 5,817 1,144 – 6,961
Internal sales 63 14 16 – –93 – – – –
Total 2,627 2,133 1,038 112 –93 5,817 1,144 – 6,961
Operating profit
Profit by line of business 204 183 28 6 7 428 87 –49 466
Goodwill depreciation – – – – –59 –59 –8 – –67
Total 204 183 28 6 –52 369 79 –49 399
Operating capital / Capital employed
Assets by line of business 1,085 892 546 104 1,186 3,813 948 329 5,090
Liabilities by line of business –268 –299 –82 –24 –868 –1,541 –187 55 –1,673
Total 817 593 464 80 318 2,272 761 384 3,417
Other information
Capital expenditure 74 33 31 8 – 146 49 3 198
Depreciation excluding goodwill 54 26 25 2 5 112 47 2 161
Operative cash flow 246 199 23 2 – 470 83 –53 500
Gunnebo Gunnebo Gunnebo Non-allocated Total Non-allocated
Physical Integrated Perimeter Gunnebo items and Gunnebo Gunnebo items and Total
2002 Security Security Security Steelage eliminations Security Engineering eliminations Group
Income
External sales 2,520 2,082 1,084 124 – 5,810 1,166 – 6,976
Internal sales 77 18 7 – –102 – – – –
Notes
Total 2,597 2,100 1,091 124 –102 5,810 1,166 – 6,976
Operating profit
Profit by line of business 170 143 49 5 18 385 81 –40 426
Goodwill depreciation – – – – –58 –58 –7 – –65
Total 170 143 49 5 –40 327 74 –40 361
Operating capital / Capital employed
Assets by line of business 1,200 925 562 112 1,180 3,979 956 499 5,434
Liabilities by line of business –306 –299 –98 –23 –984 –1,710 –173 59 –1,824
Total 894 626 464 89 196 2,269 783 558 3,610
Other information
Capital expenditure 57 29 29 2 – 117 50 1 168
Depreciation excluding goodwill 54 29 25 2 5 115 48 1 164
Operative cash flow 228 153 66 –12 – 435 88 –22 501
Gunnebo’s reporting by primary segment follows the internal organi- interest-free liabilities and provisions. Within Gunnebo Security’s divi-
sation, which consists of two main lines of business – Gunnebo sions it is not possible to allocate all of the capital employed. The
Security and Gunnebo Engineering. Within Gunnebo Security there assets employed by the divisions in their line of business consist of
are four divisions. The non-allocated costs are central costs. The tangible fixed assets, intangible fixed assets excluding goodwill,
capital employed in the main segments, Gunnebo Security and inventories and accounts receivable. The corresponding liabilities
Gunnebo Engineering, consists of all assets less liquid funds and all consist of liabilities to suppliers
Secondary segments – geographical regions
Sales Assets Capital expenditure
2003 2002 2003 2002 2003 2002
Europe 5,953 5,915 4,456 4,724 177 149
North America 369 442 262 283 9 12
Asia 380 368 268 319 10 5
Africa 132 120 45 49 1 1
Australia 88 89 46 47 1 1
South America 39 42 13 12 – –
Group total 6,961 6,976 5,090 5,434 198 168
The sales figures are based on the country where the customer is located. Assets and capital expenditure are reported on the basis of where
the assets are located.
49 Gunnebo Annual Report 2003
Note 5 cont.
NOTE 2 Administrative costs
Specification of deferred tax receivables and liabilities
Deferred tax receivables 2003 2002
Administrative costs for 2002 included structuring costs of MSEK Loss carry-forward 12.7 5.0
13.3 relating to Gunnebo Security. Non-realised effect on result of equity hedges 33.3 84.9
Other deductible timing differences 4.8 1.6
Net off against deferred tax liabilities –12.7 –
NOTE 3 Other operating income 38.1 91.5
Deferred tax liabilities
Group Tangible fixed assets 47.7 36.4
2003 2002 Other taxable timing differences 14.7 5.4
Capital gains on divestment of line of business – 12.2 Net off against deferred tax receivables –12.7 –
Currency differences 8.2 10.4 49.7 41.8
Other operating income 16.4 37.0
Total 24.6 59.6 The deferred tax receivable on account of loss carry-forward is only
stated if these loss carry-forward are likely to be utilised to reduce
taxable profits within the near future. At the end of 2003, certain
NOTE 4 Depreciation according to plan subsidiary companies had total loss carry-forward of MSEK 400, for
which no deferred tax receivable had been taken into account, and
of which some MSEK 50 expire within five years. There are both tim-
Depreciation has been charged against the operating profit as follows: ing and other constraints that mean that these loss carry-forward
are not expected to be utilised.
Group Parent company
2003 2002 2003 2002
Cost of goods sold 113.8 108.2 – –
Selling costs 83.8 83.7 – – NOTE 6 Minority interests in profit for the year
Administrative costs 29.9 37.0 0.7 0.2
Total 227.5 228.9 0.7 0.2 Group
2003 2002
Selling costs include depreciation of goodwill amounting to MSEK Profit/loss before tax –2.2 –0.6
66.6 (65.1). Tax 0.8 0.3
Notes
Net profit for the year –1.4 –0.3
NOTE 5 Taxes
NOTE 7 Earnings per share
Group
2003 2002
Actual tax –80.5 –58.0
Earnings per share 2003 2002
Deferred tax 1.8 6.3
Tax in respect of interest in earnings Net profit for the year, MSEK 259.8 228.5
of associated companies –1.1 0.3
Total –79.8 –51.4 Average no of shares in issue 21,607,897 21,208,905
Provisions have been made for estimated tax costs that are expect- Earnings per share, SEK 12:00 10:75
ed to arise as a result of previous years’ tax audits at subsidiaries.
A county court decision in June 2003 rejected deductions in con- Earnings per share after dilution
nection with sales of shares. Gunnebo maintains its position, which
has the support of leading tax experts, and has appealed to the Net profit for the year, MSEK 259.8 228.5
Administrative Court of Appeal. Should the company be refused the
right to make the deduction by the court of final instance, this would Interest costs, convertible
result in an additional tax charge of some MSEK 80. No provision loan after tax effect 1.3 3.2
has been made. Total 261.1 231.7
Effective tax rate for Group Average no of shares in
The Group’s effective tax rate, calculated as stated tax in relation to issue after dilution 21,889,974 21,987,861
consolidated profit before tax, has been influenced by the following
items: Earnings per share after dilution, SEK 11:95 10:55
%
Nominal tax rate in Sweden 28 No dilution effect has been calculated for the outstanding employee
Difference in effective tax rates of foreign subsidiaries stock options as the average listed price of the shares during the
and losses of foreign subsidiaries 2 year was SEK 151.90. The subscription price for the option
Non-deductible depreciation of goodwill 5 programme is SEK 152.00.
Net effect of loss carry-forward and items not
related to net profit for the year –13
Other taxes, etc. 1
Group’s effective tax rate 23
50 Gunnebo Annual Report 2003
Note 9 cont.
NOTE 8 Intangible fixed assets
Depreciation according to plan
Opening depreciation according to plan 3.0
Other
Sales/retirements –0.1
intangible
fixed Depreciation during the year 0.7
Group Goodwill assets Closing accumulated depreciation according to plan 3.6
Acquisition value
Opening acquisition value 1,269.7 132.5 Residual value according to plan 3.6
Capital expenditure – 45.8
Acquisitions 46.9 0.1
Sales/divestments –2.1 –6.3 NOTE 10 Shares in subsidiaries
Translation differences –16.5 –1.2
Closing accumulated acquisition value 1,298.0 170.9
No. of % of % of Book
shares capital votes value
Depreciation according to plan E A Rosengrens AB 251,000 100 100 288.2
Opening depreciation according to plan 277.5 75.2 Gunnebo Troax AB 10,000 100 100 253.1
Sales/divestments –2.1 –4.5 Fichet-Bauche SA 5,540,112 100 100 468.0
Depreciation during the year 66.6 11.6 Gunnebo Treasury SA 7,200 100 100 1,233.0
Translation differences –2.8 –1.0 Gunnebo Entrance
Closing accumulated Control AB 224,000 100 100 22.4
depreciation according to plan 339.2 81.3 Gunnebo Perimeter
Protection AB 5,500 100 100 1.6
Residual value according to plan 958.8 89.6 Gunnebo Holding ApS 1,000 100 100 27.5
Steelage Industries Ltd 2,965,989 95 95 85.3
The greater part of the year’s investments in other intangible fixed Gunnebo Physical
assets consist of capitalised product development projects of MSEK Security AB 100 100 100 0.1
68.5 (36.5). The year’s investments amounted to MSEK 33.0 (28.0) Gunnebo Industrier AB 499,799 100 100 347.0
Gunnebo Service AB 500 100 100 0.1
Hidef Industri AB 500 100 100 0.1
NOTE 9 Tangible fixed assets Total 2,726.4
Buildings Machinery Equipment, Fixed assets The year’s investments amount to MSEK 18.9 and relate to a share
Notes
and and tools and under issue by Steelage Industries Ltd. The value of the shares in Gunnebo
Group land plant installations construction
Troax AB, Steelage Industries Ltd and Gunnebo Physical Security
Acquisition value AB was written down by a total amount of MSEK 125.2, of which
Opening acquisition value 793.5 1,234.9 539.2 48.1 MSEK 0.2 related to a direct write-down of a shareholder contribu-
Capital expenditure 8.1 81.0 50.0 12.8
tion. The accumulated acquisition value of shares in subsidiaries
Acquisitions – 11.9 0.6 –
amounts to MSEK 2,886.7.
Sales/retirements –5.9 –29.7 –36.0 –
The statutory specification of company registration numbers and
Reclassifications – 1.4 – –
registered offices of all subsidiary companies in the Group may be
Translation differences –22.2 –43.1 –8.5 –1.5
obtained from Gunnebo AB’s head office in Göteborg.
Closing accumulated
acquisition value 773.5 1,256.4 545.3 59.4
NOTE 11 Financial fixed assets
Depreciation according to plan
Opening depreciation
according to plan 283.0 881.9 410.0 – Group
2003 2002
Sales/retirements –3.4 –20.4 –36.1 –
Deferred tax receivables 38.1 91.5
Depreciation during the year 26.1 77.7 45.5 –
Shares in associated companies 1) 19.7 23.2
Translation differences –6.0 –28.3 –6.0 –
Other securities held as fixed assets 2) 12.0 2.6
Closing accumulated depre-
Other long-term receivables 11.4 13.6
ciation according to plan 299.7 910.9 413.4 –
Total 81.2 130.9
Residual value
1) Specification of shares
according to plan 473.8 345.5 131.9 59.4 % of % of Book
in associated companies capital votes value
Doetinchem C.V., Netherlands 99 45 2.8
Specification, buildings and land
FBH Fichet Ltd, Great Britain 49 49 5.2
Group 2003 2002
Chubb Malaysia Sdn Bhd, Malaysia 30 30 6.1
Residual value according to plan, buildings 393.2 428.0
Residual value according to plan, land 80.6 82.5 Ritzenthaler UK 45 45 5.6
Total residual value according to plan 473.8 510.5 Total Group 19.7
Swedish property 2003 2002 The statutory specification of company registration numbers and
Residual value according to plan, buildings 107.8 110.5 registered offices of associate companies may be obtained from
Residual value according to plan, land 28.9 28.9 Gunnebo AB’s head office in Göteborg.
Assessed value, buildings 55.2 55.1
2) Specification of other securities held as fixed assets
Assessed value, land 13.0 12.7
No. of % of % of Book
shares capital votes value
Parent company Equipment
Fingerprint Cards AB 654,000 10.3 7.2 9.3
Acquisition value
Other holdings 2.7
Opening acquisition value 4.5
Total 12.0
Capital expenditure 2.9
Sales/retirements –0.2 The shares in Fingerprint Cards AB are owned by the parent com-
Closing accumulated acquisition value 7.2 pany. Their closing market capitalisation was MSEK 19.6.
51 Gunnebo Annual Report 2003
Note 14 cont. Non-
NOTE 12 Inventories Share Restricted restricted
Group capital reserves reserves Total
Group
Closing balance 31 Dec 2002 212.1 469.6 964.8 1,646.5
2003 2002 Currency differences not stated
Raw materials 311.4 307.5 in the income statement – – –32.9 –32.9
Work in progress 263.8 300.8 Net profit for the year – – 259.8 259.8
Finished goods 525.9 556.1 Dividend – – –84.8 –84.8
Work in progress on third-party account 24.7 41.1 Conversion of convertible loan 6.8 74.7 – 81.5
Less advance payments from customers –65.3 –115.3 Transfer between non-restricted
Total 1,060.5 1,090.2 and restricted capital – 17.4 –17.4 –
Equity 31 Dec 2003 218.9 561.7 1,089.5 1,870.1
The currency differences relate to the translation using the daily rate
NOTE 13 Prepaid costs and accrued income method of the financial reports of foreign businesses. The year’s cur-
rency differences were reduced by MSEK 165.2 by means of cur-
Group Parent company rency hedging. The accumulated translation differences at 31
2003 2002 2003 2002 December 2003 amounted to a deficit of MSEK 81.7 (deficit 48.8).
Accrued interest 33.4 18.2 33.4 17.6
Share Non-
Prepaid rent 7.9 7.4 0.3 – Share premium Legal restricted
Other items 56.9 49.5 2.6 6.6 Parent company capital reserve reserve equity Total
Total 98.2 75.1 36.3 24.2 Closing balance
31 Dec 2001 212.0 138.6 320.0 609.1 1,279.7
Net profit for
the year – – – 4.2 4.2
NOTE 14 Equity
Dividend – – – –74.2 –74.2
Conversion of
Non-
convertible loan 0.1 0.7 – – 0.8
Share Restricted restricted
Group capital reserves reserves Total Equity
Closing balance 31 Dec 2002 212.1 139.3 320.0 539.1 1,210.5
31 Dec 2001 212.0 479.4 822.0 1,513.4
Currency differences Net profit for
Notes
not stated in the the year – – – 7.8 7.8
income statement – – –22.0 –22.0 Dividend – – – –84.8 –84.8
Net profit for the year – – 228.5 228.5 Conversion of
Dividend – – –74.2 –74.2 convertible loan 6.8 74.7 – – 81.5
Conversion of Equity
convertible loan 0.1 0.7 – 0.8 31 Dec 2003 218.9 214.0 320.0 462.1 1,215.0
Transfer between
non-restricted and
restricted capital – –10.5 10.5 – NOTE 15 Pension provisions
Equity 31 Dec 2002 212.1 469.6 964.8 1,646.5
Group
2003 2002
FPG/PRI pensions 120.9 116.6
Other pensions 55.4 87.5
Total 176.3 204.1
NOTE 16 Other provisions
Structuring Other
Group reserve Disputes Guarantees Taxes provisions Total
Opening balance 143.9 49.6 23.2 14.7 60.8 292.2
Provisions during the year 10.5 13.5 12.2 0.1 7.2 43.5
Utilised during the year –101.3 –15.6 –9.2 –0.7 –20.0 –146.8
Re-entered during the year – –2.4 –1.3 –1.3 –6.8 –11.8
Reclassified as accrued costs etc. – – – – –13.4 –13.4
Currency differences –1.8 –0.6 –0.5 – –1.2 –4.1
Closing balance 51.3 44.5 24.4 12.8 26.6 159.6
The closing structuring reserve is expected to be utilised in 2004. The remaining reserves are expected to be utilised over the coming five
years.
52 Gunnebo Annual Report 2003
NOTE 17 Interest-bearing liabilities NOTE 21 Contingent liabilities
Loans mature or will be renewed as follows: Group Parent company
Group Parent company 2003 2002 2003 2002
2004 91.1 1,534,9 Guarantees – – 1,472.5 1,671.2
2005 130.0 – Performance guarantees etc 98.6 105.1 – –
2006 7.5 – Taxes 80.9 – – –
2007 2.0 – Pension commitments 129.3 50.0 – –
2008 and later 1,134.2 – Total 308.8 155.1 1,472.5 1,671.2
Total 1,364.8 1,534,9
The performance guarantees are mainly guarantees to customers for
The Group has a MEUR 200 syndicated loan agreement maturing in the fulfilment of undertakings. Taxes refers to a County Court deci-
2008. The loan has an agreed interest spread of 0.55% at the com- sion of June 2003 rejecting the company’s deduction on the sale of
pany’s present debt-equity ratio. Over and above this, there are two shares (see Note 5). Pension commitments refers to the difference
long-term credit agreements for a total amount of MSEK 500 running between pension commitments based on RR29, which comes into
until 2005 and 2008 respectively. The Group has not pledged any col- effect in 2004 and commitments based on previous principles,
lateral for these credits but has provided the customary covenants. which followed local rules in each country. As of 2004, the entire
The Group’s unutilised lines of credit amount to MSEK 1,385. pension commitment will be stated as a liability. The non-recurring
effect of this change will be taken, after tax effects, direct against
equity in accordance with RR5 Accounting treatment of changes in
NOTE 18 Convertible loans accounting principles.
Conversions during the year amounted to MSEK 81.5. The loan
matured in June 2003, after which the remaining outstanding loan NOTE 22 Leasing
was repaid.
Leased assets
Future payment commitments for leasing contracts have the follow-
NOTE 19 Accrued costs and deferred income ing breakdown by year:
Group Parent company
2004 102.5 2.0
Group Parent company
2003 2002 2003 2002
2005 77.7 1.9
Notes
Holiday pay liability 134.4 128.5 2.7 2.1 2006 53.9 0.9
Social security charges 67.0 55.0 2.1 1.5 2007 34.1 0.2
Accrued wages and salaries 73.6 72.8 2.7 1.4 2008 20.0 0.1
Deferred income 63.2 24.3 – – 2009 and later 21.3 –
Accrued interest 2.2 8.9 1.1 2.8 309.5 5.1
Other items 113.5 184.7 1.6 3.0
Total 453.9 474.2 10.2 10.8 The year’s cost in the Group of leased assets amounted to
MSEK 105.7 (92.4). The parent company’s costs amounted to
MSEK 1.8 (1.6).
NOTE 20 Pledged assets
NOTE 23 Net financial items affecting cash flow
Group
2003 2002 Group Parent company
2003 2002 2003 2002
In respect of liabilities to credit
Interest received 7.1 8.4 9.1 13.9
institutions/overdraft facilities
Interest paid –88.4 –98.9 –41.7 –64.3
Floating charges 22.6 33.8
Other items affecting
Property mortgages 25.8 31.9
cash flow –2.2 –1.9 20.6 18.5
48.4 65.7
Total –83.5 –92.4 –12.0 –31.9
Other pledged assets
Floating charges 1.9 1.8
Total pledged assets 50.3 67.5
NOTE 24 Acquisition and divestments of subsidiaries
Value of acquired assets and liabilities Group
2003 2002
Fixed assets –59.5 –67.5
Working capital –0.1 –1.4
Liquid funds –5.9 –19.3
Provisions for taxes/minority interests –2.1 –2.2
Interest-bearing provisions and liabilities 5.3 5.9
Total amount paid –62.3 –84.5
Liquid funds of acquired companies 5.9 19.3
Effect on Group’s liquid funds –56.4 –65.2
53 Gunnebo Annual Report 2003
Salaries and other benefits and remuneration of
NOTE 25 Employees
senior executives in the Group. Other
Salary/ Other Pension remu-
Group 2003 2002 SEK ’000 Board fee Bonus benefits cost neration Total
Average number of employees Chairman 320 – – – 52 372
Sweden 941 989 President 3,672 1,491 182 1,967 – 7,312
Australia 56 49 Other senior
Austria 10 9 executives
Belgium 87 89 (10 individuals) 15,636 2,631 1,085 4,990 – 24,342
Brazil 22 17 Total 19,628 4,122 1,267 6,957 52 32,026
Canada 201 208
China/Hong Kong 1 1 The calculation of bonuses is largely based on the result and cash
Czech Republic 12 6 flow. Other benefits relate mainly to right to a company car.
Denmark 158 139
Finland 171 175 Pensions and severance pay
France 1,588 1,514 The retirement age of the President is 60. The President has a premium-deter-
mined pension insurance. Of the parent company’s pension costs, SEK
Germany 507 457 1,967,000 (1,652,000) relate to the President. Between 1 September 2001 and
Great Britain 482 557 the President’s retirement age (60), the pension cost amounts to 55% of his
Hungary 3 2 salary, excluding bonus. In the event of the President’s contract of employ-
ment being terminated by the company he is entitled to one year’s notice and
India 1,123 1,151
severance pay corresponding to one year’s salary, any salary received from
Indonesia 1,161 1,123 another employer being netted off. Other senior executives are entitled to up to
Ireland 20 18 one year’s notice and severance pay for up to one year in the event of their
Italy 115 108 contracts being terminated by the company. Pension benefits broadly corre-
spond to the general pension plan. However, in one case the retirement age is
Lebanon 1 2 lower than 65.
Luxembourg 7 7
Norway 155 123 Employee stock option programme
Poland 126 119 The Annual General Meeting in 2002 resolved in favour of introducing an
Portugal 80 80 employee stock option programme (ESOP) for some 50 senior managerial per-
sonnel within the Group.
Singapore 5 2 In the event of full exercise, the ESOP will involve the issue of 1,000,000 new
South Africa 257 293 shares corresponding to an increase of 4.6% in the issued shares and votes.
Spain 483 488 The subscription price was 110% of the average listed price of Gunnebo’s
Switzerland 42 42 shares during a certain period around the time of the decision, namely SEK
Notes
152 per share.
The Netherlands 311 331 The employees will be allotted a maximum of 750,000 options and the
UAE 2 2 remaining 250,000 will be reserved to cover the social costs of the programme
USA 146 149 payable by the company. The allotment of options per person is 36,000 to the
Total outside Sweden 7,332 7,261 President, 24,000 to other members of Group management, and 12,000 to
other senior management personnel. They are not transferable, and conditional
Total average no. of employees in the Group 8,273 8,250 upon the individual concerned remaining in the company’s employ. The options
have been allotted free of charge.
Of the average number of employees in the Group, 1,256 (1,174) were female. So far, 612,000 options have been allotted to 39 individuals. Based on the
In 2003, the average number of parent company employees was 17 (14), of closing price of the shares, the total value of these allotted options is MSEK
whom 7 were female (5). Women occupied 2% of the senior management 16. No amount has been charged against the result. A sum of MSEK 5 is stat-
positions in the Group. There are no women on the Board of the parent com- ed in the balance sheet as an accrued cost and the corresponding amount is
pany or occupying senior management positions. stated as accrued income.
Up to one-third of 75% of the allotted options can be used to acquire shares
Sick leave within the Parent Company in 2004 at the earliest, up to another one-third in 2005 and the final third in
The rate of long-term sick leave was 5.2 % (5.7) and of short-term sick leave 2006. The remaining 25% can only be used if the Group achieves and average
was 0.2 % (1.3). increase in its earnings per share of 8% per year as of 2002, in which case up
to one-third can be used to acquire shares as of 2004. Each option entitles the
holders to subscribe to one new share in the company at a price of SEK152
Wages, salaries, other remuneration and
per share by no later than 30 April 2007.
social security charges
2003 2002
Wages and Social Of which Wages and Social Of which
other security pension other security pension NOTE 26 Auditors’ remuneration
remuneration charges costs remuneration contributions costs
Parent company 20.1 13.6 5.8 15.4 8.2 3.4 Group Parent company
Subsidiary 1,789.0 532.1 83.9 1,769.6 528.6 81.0 2003 2002 2003 2002
Group total 1,809.1 545.7 89.7 1,785.0 536.8 84.4 Auditing 7.0 6.8 0.6 0.5
Other assignments 4.4 6.0 1.2 1.9
Of the above amount, a total of MSEK 98.1 (93.3) was paid in salaries and
other remuneration to Boards and presidents within the Group, of which
MSEK 9.6 (8.4) consists of bonuses. Of the Group’s pensions costs, MSEK
NOTE 27 Transactions with related parties
14.3 (13.8) relates to board members and Presidents within the Group.
Remuneration to the Board of the parent company amounted to SEK
1,070,000 (950,000). Salary and other remuneration paid to the President Of the parent company’s invoiced sales 93% (87) related to Group companies,
amounted to SEK 5,163,000 (3,692,000), of which SEK 1,491,000 (632,000)
while purchases from Group companies accounted for 23% (14) of the total. A
royalty of MSEK 1.3 (0.9) was received from Chubb Malaysia Sdn, an associ-
was bonus. ated company. A consulting fee of SEK 52,000 (66,000) was paid to Holtback
The statutory specification of wages, salaries and other remuneration, and och Partner AB, which is owned by Roger Holtback, Gunnebo’s chairman.
social security charges, by country may be obtained from Gunnebo AB’s head Over and above these, there were no other transactions with associates.
office in Göteborg. A complete annual report may also be obtained from the
National Patent and Registration Office.
54 Gunnebo Annual Report 2003
Proposed treatment of
unappropriated earnings
The consolidated non-restricted equity as stated in the consoli- The Board proposes that the above amount be dealt with as fol-
dated balance sheet amounts to MSEK 1,089.5. No transfer to lows:
restricted reserve is required.
The following unappropriated earnings of the parent compa-
ny are at the disposal of the Annual General Meeting:
To be paid out to shareholders by way
Retained earnings from 2002 454.3 MSEK of dividend of SEK 4.50 per share 98.5 MSEK
Net profit for the year 7.8 MSEK To be carried forward 363.6 MSEK
462.1 MSEK 462.1 MSEK
The income statements and balance sheets will be submitted to the Annual General Meeting to be held on 29 March 2004 for adoption.
Göteborg, 4 February 2004
Roger Holtback
Chairman
Martin Svalstedt Rolf Ekedahl Nils-Olov Jönsson Mikael Jönsson Sten Langenius
Ulf Jonsson Claes-Göran Karlsson Göran Törnvall
Report of the auditors
Bjarne Holmqvist
President and CEO
Report of the auditors
To the Annual General Meeting of Gunnebo AB (publ),
Co.reg.no. 556438-2629
We have examined the annual report, the consolidated financial decisions, measures and circumstances in the company in order
statements, the accounting records and the administration by to determine whether any member of the Board or the President
the Board and the President of Gunnebo AB (publ) for the 2003 has become liable to pay compensation to the company.
financial year. The Board and the President have responsibility We have also examined whether any member of the Board or
for the accounting records and the administration of the compa- the President has acted in any other way in contravention of the
ny. Our responsibility is to express our opinion on the annual Swedish Companies Act, the Annual Accounts Act or the com-
report, the consolidated financial statements and the administra- pany’s articles. We consider that our audit provides reasonable
tion of the company on the basis of our audit. grounds for our statements below.
Our audit was performed in accordance with generally accept- The annual report and the consolidated financial statements
ed auditing standards in Sweden. This means that we planned are made up in accordance with the Annual Accounts Act and
and carried out the audit in order to assure ourselves, to a rea- thus provide a true and fair picture of the result and financial
sonable degree, that the annual report and the consolidated position of the parent company and the Group in accordance
financial statements are free from material error. An audit with generally accepted accounting practice in Sweden.
involves examining a selection of the documents in support of We recommend that the Annual General Meeting adopt the
amounts and other information in the accounts. An audit also parent company’s income statement and balance sheet, and the
involves testing the accounting principles and their application consolidated income statement and the consolidated balance
by the Board and the President, and making an assessment of sheet, that the parent company’s unappropriated earnings be
the totality of the information in the annual report and the con- dealt with in accordance with the proposal in the Report of the
solidated financial statements. As a basis for our statement con- Directors, and that the members of the Board and the President
cerning discharge from liability we have examined significant be discharged from liability for the financial year.
Göteborg, 4 February 2004
PricewaterhouseCoopers KB
Ingvar Pramhäll, Principal auditor Bror Frid
Authorised public accountant Authorised public accountant
55 Gunnebo Annual Report 2003
Members of the Board
Roger Holtback, born 1945 Nils-Olov Jönsson, born 1934 Mikael Jönsson, born 1963 Sten Langenius, born 1934
Chairman. Chairman of Holtback Invest AB, Elected to the board in 1994. Elected to the board in 2000. Company Director. Elected to the board
subsidiary and associate companies. Other board appointments: Other board appointments: in 1995.
Elected to the board in 1993. Executive chairman of Vätterledens Vätterledens Invest AB and subsidiaries, Other board appointments: Nordic Shelter
Other board appointments: Invest AB. Member: Most Vätterleden Ksg Systems AB, Wipcore AB. Solutions-Group OY, IWS International
Chairman of Capio AB, Song Networks subsidiaries, and Kopparbergs Shareholding: 46,000 Inc., Volvo Construction Equipment Corp.
Holding AB, S.A.T.S. Holding AB, the Swedish Bryggerier. President of AB N.O. AB Volvo Penta, and Swemed LAB
Trade Fair Foundation and Nordic Capital Jönsson. International AB
Review Committee. Member: Holland America Shareholding: 5,080,228. Shareholding: 8,000.
Investment Corp (USA), Stena Group Council.
Shareholding: 80,000.
Members of the Board
Rolf Ekedahl, born 1949 Martin Svalstedt, born 1963 Bjarne Holmqvist, born 1945 Claes-Göran Karlsson, born 1958
President of Rörvik Timber AB. President Stena Adactum AB. Elected President and CEO Gunnebo AB. Representative of the employees.
Elected to the board in 1993. to the Board in 2003. Elected to the board in 1993. Elected to the board in 2001. Employed
Other board appointments: Other board appointments: Other board appointments: by Rosengrens Produktions AB.
Member: INAC AB, Håells AB, ROL Chairman of Gislaved Folie AB. Chairman of Chalmers Foundation for
Inredningar AB, Arcam AB, Member: Ballingslöv International AB. Industrial Technique.
Backemarks Grafiska AB and Member: Hogia AB
Novmans AB. Shareholding: 265,667
Shareholding: 6,000. Stock options: 36,000
AUDITORS
Ulf Jonsson, born 1957 Bo Anders Hansson, born 1954 Göran Törnvall, born 1946 Bror Frid, born 1957 Ingvar Pramhäll, born 1942,
Representative of the employees. Representative of the employees, Representative of the employees. Authorised public accountant Principal auditor
Elected to the board in 1998. deputy member, elected to the Elected to the board in 1996. Authorised public accountant
Employed by Gunnebo board in 1999. Employed by Gunnebo Industrier AB.
Industrier AB. Employed by Gunnebo Protection AB.
56 Gunnebo Annual Report 2003
Management
Torbjörn Browall Christian Selosse Christer Lenner
Born 1962 Born 1945 Born 1947
Head of Gunnebo Physical Head of Gunnebo Integrated Head of Gunnebo Engineering
Security Security Employed: 1985
Employed: 2002 Employed: 1997 Shareholding: 200
Stock options: 24,000 Stock options: 24,000 Stock options: 24,000
Bjarne Holmqvist
Born 1945
President and CEO,
Gunnebo AB.
Employed: 1993
Management
Shareholding: 265,667
Stock options: 36,000
Philip Mozes Stefan Andersson Deepak Khetrapal Lennart Gustavsson
Born 1954 Born 1964 Born 1955 Born 1945
Head of Gunnebo Perimeter Head of Gunnebo Troax Head of Gunnebo Asia Pacific Chief Financial Officer
Protection Employed: 2002 Employed: 1994 Employed: 1993
Employed: 1996 Shareholding: 200 Shareholding: 35,000
Shareholding: 1,359 Stock options: 24,000 Stock options: 24,000
Stock options: 24,000
OTHER SENIOR COMPANY OFFICERS
Janerik Dimming Ulf Johnsson Lars Wallenberg Torbjörn Olsson Björn Strömberg
Born 1945 Born 1949 Born 1951 Born 1962 Born 1960
Director of Information Human Resources Director General Counsel, Group Treasurer Group Controller
Employed: 2001 Employed: 2002 Mergers & Acquisitions Employed: 2002 Employed: 1995
Shareholding: 600 Shareholding: 400 Employed: 2002 Shareholding: 1,000 Shareholding: 2,000
Stock options: 24,000 Stock options: 24,000 Shareholding: 10,390 Stock options: 12,000 Stock options: 12,000
Stock options: 24,000
57 Gunnebo Annual Report 2003
Gunnebo Worldwide
Parent Company Gunnebo Physical Security Gunnebo Integrated Security
Gunnebo AB Gunnebo Physical Security AB Fichet-Bauche SA
P. O. Box 5181 P. O. Box 5321 Boîte Postale 11
SE-402 26 GÖTEBORG SE-402 27 GÖTEBORG FR-78141 VELIZY Cedex
Sweden Sweden France
Office: Drakegatan 5 Tel: +46-31 749 90 50 Tel: +33-1 34 65 65 34
Tel: +46 31 83 68 00 Fax: +46-31 749 90 60 Fax: +33-1 34 65 39 47
Fax: +46 31 83 68 10 Email: info@gunnebo.se Email: info@fichet-bauche.fr
Email: info@gunnebo.se
www.gunnebo.se Divisional management: Divisional management:
Torbjörn Browall, Divisional President Christian Selosse, Divisional President
Bjarne Holmqvist, President and CEO Bertil Gunnesson, Finance/Control Olivier Miaux, Accounting
Lennart Gustavsson, Chief Financial Officer David Barry, Personnel Paul Heilbronner, Personnel
Lars Wallenberg, General Counsel, Mergers & Sven Boëthius, Safes Olivier Bianchi, Marketing
Acquisitions Peter Leicher, Bank automation Lars Proos, Entrance Control Systems
Ulf Johnsson, Human Resources Gunnar Konkell, Retail automation Jean Marie Betermier, Interlocking Doors
Janerik Dimming, Group Communication Jean-Louis Bayard, Production Laurent Mussilier, Electronic security
Tom O’Doherty, Sales America systems and surveillance centres
Jay Wright, Sales Northern &
Eastern Europe
Fred Mertens, Sales Southern Europe,
Middle East and Africa
Gunnebo Worldwide
Gunnebo Security Gunnebo Head Office Gunnebo Engineering Jointly owned companies
58 Gunnebo Annual Report 2003
Gunnebo Perimeter Security Gunnebo Asia Pacific Gunnebo Engineering
Gunnebo Perimeter Protection Gunnebo Asia Pacific Gunnebo Industrier AB
Postbus 18 907, Maker Chambers V SE-590 93 GUNNEBO
NL-2210 AA NOORDWIJKERHOUT Nariman Point Sweden
The Netherlands IN-MUMBAI 400 010 Tel: +46 490 890 00
Tel: +31 252 377 804 Tel: +91-22 5606 4020 Fax: +46 490 892 14
Fax: +31 252 341 419 Fax: +91-22 5637 4738 Email: info@gunneboindustries.com
Email: info@gunneboprotection.com E-post: ddk@steelage.co.in
Divisional management:
Divisional management: Divisional management: Christer Lenner, Divisional President
Philip Mozes, Divisional President Deepak Khetrapal, Divisional President Per Olin, Accounting
Fredrik Granat, Accounting Naresh Hosangady, Gunnebo Steelage Robert Hermans, Lifting
Ulf Johnsson, Personnel William Mouat, PT Indolok Bakti Utama William Shenloogian, Blocks
Elsie Tay, Gunnebo Security Singapore Martin Jonsson, Fastening
Gunnebo Troax AB Anders Stigvall, Non Skid
P. O. Box 89
SE-330 33 HILLERSTORP Divisionsledning:
Sweden Deepak Khetrapal, divisionschef
Tel: +46-370 828 00 Vemuri Sridhar, ekonomi
Fax: +46-370 824 86
Email: info@troax.se Uday Kulkarni, försäljning och marknad
Divisional management:
Gunnebo Worldwide
Stefan Andersson, Divisional President
Andreas Green, Accounting
Ulf Johnsson, Personnel
Lasse Siirtola, Projects
Lars-Göran Nilsson, Purchasing
Morgan Barrington, Marketing
Åke Berg, Technology
Anders Carlsson, Logistics
Nebojsa Obradovic, Production
59 Gunnebo Annual Report 2003
Country Company / Business unit President
Australia Gunnebo Chain & Lifting Pty Ltd Colin Saad
Gunnebo Security Pty Ltd Daniel Turner
Austria Gunnebo Troax GmbH Erich Reuschel
Belgium Fichet Security SA Jean-Pierre Deschuyter
Gunnebo Troax NV Jean-Pierre Deschuyter
Brazil Gunnebo do Brasil Ltda Stefan Lundqvist
Canada Gunnebo Security Inc. Tom O’Doherty
China Gunnebo Rosengrens Asia Pacific Ltd Elsie Tay
Gunnebo Entrance Control Kenneth Ong
Czech Republic Leicher-Fest s r o Radek Zykmund
Denmark Gunnebo Protection A/S Jens Bollerup
Troax A/S Claus Rolsted
Rosengrens-Seifert A/S Henning Dalsgaard
Finland Troax Oy Sakari Pajakoski
OFA Oy Ab, Jokioinen Heikki Helminen
OFA Oy Ab, Loimaa Jouni Nurminen
Gunnebo Polaraidat Oy Marko Heiskanen
Gunnebo Worldwide
France Chubb Safes SA Dominic Vomscheid
Eurosecur SARL Jean Pierre Seys
Fichet Automation SA Olivier du Portal
Fichet-Bauche SA Christian Selosse
Fichet Sécurité Electronique SAS Laurent Mussilier
Fichet Sécurité Physique SAS, Bazancourt Francois Moutte
Fichet Sécurité Physique SAS, Paris Olivier du Portal
Fichet-Bauche Télésurveillance Jean Marc Pretet
Gunnebo Entrance Control SARL Eric Galinha
Gunnebo Wego SARL Pascale Müller
Haffner Dominic Vomscheid
Hygiaphone SARL Yves Fazilleau
Ritzenthaler SA Jean Marie Betermier
Troax SA Rob Markus
Germany Garny Sicherheitstechnik GmbH Günther Schönknecht
Gunnebo GmbH Horst Schröder
Gunnebo Entrance Control GmbH Stephen Bates
Gunnebo Security GmbH Wolfgang Amann
Gunnebo Wego GmbH Sicherheitssystem Karsten Hamborg
Leicher Projekt GmbH Olaf Kisser
Leicher Tresorbau GmbH & Co. KG Florian Leicher
Ritzenthaler GmbH Marcel Fleischmann
Troax GmbH Wolfgang Falkenberg
Werra Tor & Zaun GmbH Hartwig Vogt
Kubon AG Florian Leicher
Great Britain Gunnebo Security Ltd Martin Houseman
CSI Security Ltd Mike Parry
Churchill Safes Ltd Martin Houseman
FBH Fichet Ltd (49% interest) Andrew J. Mackey
Rosengrens Tann Ltd Martin Houseman
Troax UK Ltd David Teulon
Troax Lee Manufacturing Ltd David Teulon
Gunnebo Ltd Anders Stigwall
Gunnebo Mayor Ltd Rob Wheeler
Ritzenthaler Co Ltd (45% interest) Graham Midgley
Hungary Leicher Hungaria Kft István Roszmann
India Gunnebo Asia Pacific Deepak Khetrapal
Steelage Industries Ltd Naresh Hosangady
Indonesia PT Indolok Bakti Utama William Mouat
Ireland Gunnebo Irland Ltd Patrick Doyle
60 Gunnebo Annual Report 2003
Country Company / Business unit President
Italy Fichet Italia SRL / Fichet SpA Arrigo Horn
Gunnebo Italdis SpA Michele Maistri
Gunnebo Troax SRL Francesco Intini
Lebanon Fichet Middle East Ltd Nabil Shahlawi
Luxembourg Fichet-Bauche SARL Jean-Jacques Brusco
Malaysia Chubb Malaysia Sdn Bhd (30% interest) Ravindran Gengadaran
Northern Ireland W H Scott Ltd Patrick Doyle
Norway E A Rosengrens AS/Clausen Tor Melleberg
Gunnebo Anja Industrier AS Atle Jacobsen
Gunnebo Troax AS Erik Krognes
Gunnebo Perimeter Protection Øystein Hansen
Tellefsdal Per Tellefsdal
Poland Rosengrens Praediator Polska Sp zo o Jerzy Szkalej
Gunnebo Baltic Sp zo o Örjan Hammar
Gunnebo Protection Sp zo o Jerzy Szkalej
Portugal Fichet Comércio SA Carlos Valpradinhos
Ritzenthaler Lda José Caracol
Singapore Gunnebo Security Pte Ltd Elsie Tay
Gunnebo Worldwide
South Africa Cargo Control Systems (Pty) Ltd Richard Eyres
Gunnebo Security SA (Pty) Ltd Gerrit Venter
Spain Fichet Industria SL Jordi Vendrell
Fichet Sistemas y Servicios SA José A. Ortuño
Ritzenthaler Hugo Balaguer
Troax Systems SL Stéphan Zacharie
Gunnebo Entrance Control SL Rafael Roy
Sweden Gunnebo AB Bjarne Holmqvist
Gunnebo Physical Security AB Torbjörn Browall
E A Rosengrens AB Hans Schröder
Rosengrens Produktions AB, Mora/Malung Hans Granqvist
Rosengrens Larm AB Jay Wright
Gunnebo SafePay AB Gunnar Konkell
Gunnebo Entrance Control AB Lars Proos
Gunnebo Industrier AB, Gunnebo Christer Lenner
Gunnebo Industrier AB, Fastening, Gunnebo Martin Jonsson
Gunnebo Industrier AB, Lifting, Ramnäs Håkan Carefall
Gunnebo Industrier AB, Lifting, Junsele Stig-Olof Danielsson
Gunnebo Industrier AB, Lifting, Gemla Patric Martinsson
Gunnebo Industrier AB, Lifting, Gunnebo Jan-Erik Tegstedt
Gunnebo Industrier AB, Lifting, Göteborg Walter Svensson
Gunnebo Protection AB, Gunnebo/Ödeborg Staffan Grimbrandt
Gunnebo Troax AB Stefan Andersson
Troax Sverige AB Stefan Henningson
Switzerland Gunnebo Security Suisse Pte Ltd Mike Finders
Gunnebo Wego AG Urs Studer
Gunnebo Troax Henrik Skölderfors
The Netherlands Alura Hekwerk BV Huub Laverman
Gunnebo Perimeter Protection Philip Mozes
Gunnebo Troax BV Sellie Huijsmans-Kuperus
Koninklijke Martens Brandkasten BV Henk Portegies Zwart
Lips Safes BV Henk Portegies Zwart
Rosengrens Europe BV Wiebe Raap
SecureLine Peter Knobel
United Gunnebo Security Jacob Touma
Arab Emirates
USA Gunnebo Johnson Corp William Shenloogian
Gunnebo Omega Inc. Garyl Cauble
Gunnebo Security Inc. Tom O’Doherty
Gunnebo AB (publ)
Co. reg. no. 556438-2629
Box 5181, SE-402 26 Göteborg, Sweden
Tel: +46-31 83 68 00
Fax: +46-31 83 68 10
E-mail: info@gunnebo.se
www.gunnebo.se
Shared by: sdfgsg234
Related docs
Other docs by sdfgsg234
