DATELINE: STOCKHOLM, Sweden, Feb. 21, 2002 (PRIMEZONE) - Ratos Report: Hear CEO Arne Karlsson's comments on this Report at www.ratos.se.
-- Pre-tax profit SEK 1,926m (1,977 -- Earnings per share SEK 22.07 (23.50) -- Proposed dividend SEK 6.25 per share (5.50) -- Total return on Ratos shares +27% -- Positive EBITA development in holdings
Developments in 2001
Ratos completed the largest acquisition and the largest divestment in its history in 2001. At the same time, Ratos phased out its asset management activities. This means that the private equity strategy launched three years ago is now implemented. During the transitional phase from a pure investment company to a fully invested private equity company, Ratos's shareholders have received good growth in value. The total return from 1 January 1999 to year-end 2001 was 97%, which can be compared with the SIX Return Index which rose 29% in the same period. In 2001, the total return on Ratos shares was 27% while the SIX Return Index fell 15%.
New and follow-on investments were made for a combined total of SEK 3,793m in 2001. At year-end, Ratos had 25 holdings. 13 new companies were added through the Atle acquisition. The holding in Hilton was received as part payment for the sale of Scandic Hotels, and a further two companies, Lindab and the Norwegian biotechnology company Dynal Biotech, were acquired later in the year. Exits were completed during the year for a total of SEK 2,450m and included Scandic Hotels, Sweden On Line and Telelogic.
The global economy was weak in 2001 with a noticeably negative effect towards the end of the year after the terrorist attacks in the U.S. The situation for Ratos's holdings, however, was mixed. Some sectors and geographic markets experienced a decline in demand, which in some cases was dramatic. Other remained at a high level, with some even showing good growth. Overall, the development for Ratos's holdings was positive.
Total pro forma EBITA (full-year earnings before net financial items, tax, items affecting comparability and goodwill amortization, excluding funds received from Alecta in 2000) for the subsidiaries and associated companies owned by Ratos at year-end, increased by approximately 22%. Taking Ratos's different stakes in the holdings into account, pro forma EBITA rose approximately 6%.
Ratos expects a gradual economic recovery in 2002. This combined with action programs initiated in several holdings, and which are expected to have an impact in 2002 and 2003, provides prospects for a continued positive trend for operating profit in 2002.
Results
The Group's pre-tax profit amounted to SEK 1,926m (1,977). This result includes profits from the holdings of SEK 1,817m (1,046), of which write-downs accounted for SEK 248m (0) and profit from asset management SEK 234m (1,008). Central income and expenses amounted to SEK -125 (-77).
Profit from holdings rose to SEK 1,817m (1,046). Excluding exit gains, current profit from holdings amounted to SEK 203m (320).
Ratos's amortization of subsidiaries' and associated companies' goodwill and Ratos's share of goodwill amortization in subsidiaries and associated companies totaled SEK 265m. In addition, Ratos's share of goodwill amortization in DataVis was SEK 40m.
In the 2001, closing accounts a review was performed of the reported value of all Ratos's holdings whereby the recoverable amount has been determined as the estimated value in use of the assets, where a market value was not available. In these valuations a need was identified to adjust the consolidated book values in three holdings: DataVis, Programmera and Q-Labs. The total cost of these write-downs amounts to SEK 248m.
Development in the holdings, against the background of the economic climate, was predominantly favorable. EBITA improved compared with the previous year in eight of the holdings, while an unchanged positive EBITA is reported in two holdings. Seven holdings report weaker but still positive earnings while six holdings posted a loss in 2001.
The major change in the composition of Ratos's portfolio which has been implemented successively during the year means that comparisons between the years as reported above are not reflected in the Group's net profit for the year. For the purpose of clarity, key full-year figures for all holdings are provided in the table on the final page of this report.
Financial calendar
Annual Report 2001 March 2002Interim Report, January-March 13 May 2002Interim Report, January-June 26 August 2002Interim Report, January-Sept 13 November 2002
The full text report with financial tables can be found at the following URLs: www.waymaker.net/bitonline/2002/02/21/20020221BIT00780/bit0002.docwww.waymaker.net/bitonline/2002/02/21/20020221BIT00780/bit0002.pdf
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