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Bobst Group Annual report 2010 Annual report 2010 111.04.11 08:32 1 . 0 4 . 1 1
0 8 : 3 2 Bobst Group
Worldwide leading supplier of equipment and services to packaging manufacturers in the folding carton, corrugated board and flexible materials industries.
The actors of the packaging market: from equipment to final consumer
Bobst Group Customers of Bobst Group Packaging users Distributors, final consumer
Equipment and services supplier Packaging manufacturers Producers of industrial for printing, cutting, folding, folding carton, corrugated and consumer goods. gluing and other processes board, flexible materials. related to packaging manufacturing in folding carton, corrugated board and flexible materials.
1 Key data
In million CHF
Sales Operating result Net result
2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 2000 200 180
1000 0 0
0 -200 -180 1'603.7 1'743.6 1'633.2 1'055.5 1'280.2 120.1 188.1 86.0 -175.2 61.3 103.3 138.1 55.9 -160.7 49.3 7.5% 10.8% 5.3% -16.6% 4.8% 6.4% 7.9% 3.4% -15.2% 3.9% at average exchange rates, current year. as % of sales. as % of sales.
Net cash/Net debt Capital expenditures Shareholders’ equity
2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 300 100 1000
0 50 500
-300 0 0
-45.3 248.5 -149.7 -174.8 -163.3 23.9 32.2 40.2 26.1 56.8 924.5 1'035.1 725.2 577.8 577.7
Number of employees Market capitalization Earnings per share in CHF
2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 6000 2000 10
3000 1000 0
0 0 -10 5'267 5'428 5'939 5'488 5'121 1'187 1'597 565 668 766 5.67 7.59 3.26 -9.73 2.98
as of 31 December.
2 Bobst Group Annual report 2010 Key data
Evolution over five years
In million CHF
Balance sheet (before appropriation of available earnings)
2008 2010 2009 (restated) 2007 2006
Assets Non-current assets 645.8 39% 592.6 34% 598.5 35% 608.1 28% 736.3 35% Current assets 997.6 61% 1'160.1 66% 1'093.4 65% 1'562.8 72% 1'371.1 65% 1'643.4 100% 1'752.7 100% 1'691.9 100% 2'170.9 100% 2'107.4 100% Liabilities Equity 577.7 35% 577.8 33% 725.2 43% 1'035.1 48% 924.5 44% Non-current liabilities 508.2 31% 629.4 36% 433.7 26% 319.5 15% 559.3 26% Current liabilities 557.5 34% 545.5 31% 533.0 31% 816.3 37% 623.6 30% 1'643.4 100% 1'752.7 100% 1'691.9 100% 2'170.9 100% 2'107.4 100%
Results
2010 2009 2008 2007 2006
Sales 1'280.2 1'055.5 1'633.2 1'743.6 1'603.7
Operating result 61.3 -175.2 86.0 188.1 120.1 In % of sales 4.8% -16.6% 5.3% 10.8% 7.5%
Net result 49.3 -160.7 55.9 138.1 103.3 In % of sales 3.9% -15.2% 3.4% 7.9% 6.4% In % of equity 8.5% -27.8% 7.7% 13.3% 11.2%
Share income Share price at the end of the year 43.0 37.5 31.8 80.7 60.0 EPS (note 12) 2.98 -9.73 3.26 7.59 5.67 Price-earnings ratio 14.4 -3.9 9.7 10.6 10.6 Dividend paid: – total, in million CHF 0.0* 0.0 0.0 69.3 37.6 – payout ratio 0.0%* 0.0% 0.0% 50.2% 36.4% – dividend yield 0.0%* 0.0% 0.0% 4.3% 3.2%
Number of employees 5'121 5'488 5'939 5'428 5'267 % change compared with previous year -6.7% -7.6% 9.4% 3.1% 5.7%
* As per proposal for the appropriation for available earnings (note 29).
3 Contents
5 Letter to our shareholders 8 Anticipate, develop, deliver 14 Mission & vision 16 Strategy 18 Organization 20 Global network 22 Business Unit Sheet-fed 26 Business Unit Web-fed 30 Business Unit Services 34 Sustainability report 42 Corporate governance 58 Milestones of the Group 61 Financial statements 65 Consolidated financial statements 121 Bobst Group SA, statutory accounts
4 Bobst Group Annual report 2010 Contents Letter to our shareholders
2010 marked the return of growth and to a major improvement in profitability. After a difficult year 2009, ending for the first time ever with an operating loss and a large volume decline, we had no alternative but to lead the Group through major changes. Our efforts resulted in a consolidated turnover of CHF 1'280 million, or +21% compared to 2009, and an operating profit of CHF 61.3 million or, on a like for like basis (underlying), a loss of CHF 4.3 million. The Group’s net profit reached CHF 49.3 million or, on a like for like basis (underlying), a loss of CHF 1.8 million, compared to an operating loss of CHF 175.2 million, a net loss of 160.7 million, and a volume decline of 35.4% in 2009.
We put all our energy into achieving this successful turnaround. Having started 2010 with a weak backlog, we were helped by a steady increase in order entries during the first semester. Since January 1, 2010, the Group has operated with three Business Units – Sheet-fed, Web-fed and Services. The consolidated turnover of CHF 1'280 million includes the following elements: – an organic growth of CHF 298 million; – the change in the scope of consolidation with a negative impact on sales of CHF 13 million with the sale, in October, of Atlas Converting Equipment Ltd in Bedford/UK and its brands Atlas and Titan; – the negative exchange rate evolution of the Euro, the Dollar and the Pound which put a huge pressure on our Group with a negative impact on sales of CHF 60 million.
The folding carton, corrugated board and flexible material industries contributed to the growth in turnover as they recovered from the 2009 crisis. The Business Unit Sheet-fed gained 31% versus 2009, while the Business Unit Web-fed increased by 23%, and the Business Unit Services improved by 6.4%. However, the extreme exchange rate fluctuations which started in July 2010 had a considerable impact on the growth of our turnover and profitability, resulting in price pressure as our competitors fought to keep market share.
In 2010, the economic climate has improved globally although the recovery rate was slower than expected. In our markets the investment mood remained volatile and governments were not giving clear signals as to whether they would continue to support the economy. North America has shown strong signs of recovery, while the economic climate was very unbalanced throughout Europe. The growth rate in emerging countries has not compensated the volume reduction in industrialized countries.
The operational excellence program, which is part of the “Group Transformation Program”, focused on several aspects: – sales and services activities; – streamlining of development activities; – lean production and right sizing of production footprint or, creating more value for customers with fewer resources; – back office and the rollout of common enterprise resource planning (ERP) system.
Although priorities and volume growth slowed down the pace of savings, the major transformation programs we have been pursuing in 2010 are going well. We must, however, keep the momentum and continue to look for additional savings and areas where we can improve our profitability. To achieve this objective, we have developed a Group project management approach to ensure the adequate allocation of resources and priorities, to better focus our efforts, to maximize impact, and to provide clear accountabilities to management. This should allow us in 2011 to reach the target set at the beginning of the program. Knowing that exchange rates will remain quite volatile in the future, it is essential that we continue our Group transformation.
5
Some major events marked 2010. In March, the Board of Directors agreed to invest CHF 180 million in project TEAM (“Tous Ensemble à Mex”, e.g. the move from Prilly to new premises in Mex). In September, the official inauguration of the extension works offered a concrete view of what was still a dream or an abstract idea in the mind of many people. This project, once completed, will be the symbol of Bobst Group technological leadership and a strong motivator for our employees. Our aspiration is to develop a passion for excellence in a highly efficient work environment, fully integrated in a splendid region and respectful of the surrounding nature and of our ecological values.
TEAM is deeply linked to project PHOENIX (lean organization in everything we do) whose objectives are to: – systematically eliminate waste from the date we receive the customer order until the equipment is delivered, accepted and paid for; – introduce the lean production concept and have it adopted by all departments; – maximize customer satisfaction by focusing all our efforts on reducing total lead time.
PHOENIX is key to the Company’s future improvement of profitability and requires that we all stand as one behind this project. This is an accelerator of change and offers the unique opportunity to create common platforms and modules using standard components, to develop a supplier network, and to build up adequate competences and skills which are the motor for growth and competitiveness. Our customers deserve the best from our Group.
Another milestone in the life of the Group was the Competence ‘10 open house held in Mex/Switzerland in September. It was a tremendous success, attracting 626 companies and more than 2'000 visitors from 57 countries. With the topic of “Towards Zero Fault Packaging” in the background, we presented six world premieres to enthusiastic customers, hoping that the interest shown will materialize in orders during 2011.
In October, we sold Atlas Converting Equipment Ltd, Bedford/UK and its flagship brands Atlas and Titan to its management. At the same time, we acquired 65% of Gordon Ltd, one of the leading players in China in the corrugated board and folding carton industries. With this acquisition, we aim to reinforce the Bobst Group strategy and presence in China and in other emerging countries of the world, thus demonstrating our determination to become a leading player in this growing segment.
The Group Executive Committee will undergo changes which were decided this year but will be effective in April 2011. We welcome Mr. Stephan März, who will join Bobst Group on April 1, 2011, to take over the Business Unit Services. We continue to actively work at a local level on the development of our services activities to stay close to the needs of our customers. As we wish to become business partners with our clients, with trend setters and to interact better with our markets, Mr. Claude Currat will lead, as Senior Vice President Global Accounts, the essential task of sharing with Bobst Group our customers’ strategy requests, thus demonstrating our commitment to the markets by being attentive and receptive to evolution in the industry.
At the forthcoming Annual General Meeting of Shareholders of May 4, 2011, the mandates of Messrs. Thierry de Kalbermatten and Christian Engel, will come to an end.
Mr. Christian Engel will not present himself for re-election. He has been a Board member since 2001. The Board thanks him for his longstanding membership and his valuable contribution over the years.
In agreement with the Board of Directors, Mr. Thierry de Kalbermatten will be proposed for re-election.
2011 will remain a year economically and politically filled with prospects and uncertainties. While we pursue the transformation program, we anticipate that the positive trend will continue. However, our development will still be influenced by the volatility of currencies.
Based on the 2010 results, the Board of Directors will recommend no dividend payment, allowing our Group to strengthen the equity.
6 Bobst Group Annual report 2010 Letter to our shareholders
Charles Gebhard Bobst Group continues to invest in the acquisition and development of know-how and Jean-Pascal Bobst skills, and is recognized as a company dedicated to training with an excellent reputation in this field. The site of Lausanne in Switzerland hosts approximately 250 apprentices under a dual (theoretical and practical) training concept, and other sites of the Group such as Shanghai/China, Pune/India, Itatiba/Brazil, and Fischer & Krecke in Bielefeld/Germany share the same concept. Bobst Group’s objective is to become a center of excellence for this type of dual education. By defending the quality of its training, Bobst Group remains true to its motto “Knowledge and People”, and contributes to support the industry.
We are pleased to have in our ranks experienced, talented, and valuable people who have faith in our values and in the future of our Company. In this fast changing world, our objectives cannot be reached without our people, who live and transmit a passion for excellence and who strive to give our customers full satisfaction. We thank them for their hard work and commitment. We also thank our customers and shareholders for their continued loyalty and support.
Charles Gebhard Jean-Pascal Bobst Chairman of the Board Chief Executive Officer
7 Local solutions and global services
One of the pillars of excellence of world leader Bobst Group is the ability to respond to the specific needs of customers and to actively contribute to their success. Closeness and quality in long-term relationships with customers, along with an under standing of their daily concerns and requirements, necessitate constant responsiveness to the most exacting of demands. Consequently, Bobst Group is able to offer the most competitive solutions to the packaging manufacturers who place their confidence in it.
8 Bobst Group Annual report 2010 Anticipate Local solutions and global services
anticipate
9 Innovative responses to the needs of the market
The new solutions developed by the specialists at Bobst Group very effectively answer the technological and economic imperatives of an extremely competitive market. The know-how and technical expertise of Bobst Group ensure customers get access to innovative machines that are perfectly suited to their needs. They gain in both performance and flexibility, while improving the quality of their packaging and reducing their environmental footprint.
10 Bobst Group Annual report 2010 Develop Innovative responses to the needs of the market
develop
11 Tailored products and services
True pioneer in its field of expertise, Bobst Group is the partner of choice for packaging manufacturers active in the folding carton, corrugated board, and flexible materials industries. In an admittedly dynamic market, that is sometimes turbulent, customers can count on Bobst Group. Its broad range of equipment and its worldwide network of services centers are among the many assets that enable clients to maximize their production.
12 Bobst Group Annual report 2010 Deliver Tailored products and services
deliver
13 Mission & vision
To help our customers worldwide to supply safe, cost-efficient, environmentally friendly and appealing packaging: this is our mission.
We want to play a key role in the success of our customers
With our know-how at the service of the packaging industry, we are able to leverage our technologies and expertise to enable our customers to add value to paper, paperboard, corrugated board and flexible materials. We will serve related fields where our contribution creates a clear customer advantage.
We strive to fulfill the needs of a broad and diverse customer base. Ranging from large international customers to local specialized niche players, they will find in us their partner of choice.
Our customers face increasing challenges in productivity, cost efficiency, quality, flexibility and innovation. Our solutions play a key role for them in meeting these challenges successfully. We provide tailored support throughout the entire life cycle, including supplying the equipment, the systems, and the services our customers need.
We create sustainable, long-term value for all our stakeholders
Our efforts are founded on a “balanced stakeholder approach”. The interests of our customers, shareholders, employees, local communities, suppliers and financial institutions need to be satisfied equally to the best of our abilities.
We believe that sustainable, long-term value creation for all our stakeholders is only achievable through a superior position in the market. Therefore we aim to become or remain Number 1 in each of the businesses we are active.
Our measure of success is internal business value creation. By optimizing return on capital employed, plus continuous growth, we deliver long-term superior shareholder return.
14 Bobst Group Annual report 2010 Mission & vision The Bobst Group way: specialists with a strong bond
Our individual businesses are leading specialists in their fields. Combining these businesses gives our customers a twofold advantage: By integrating individual production processes and applying our way of doing business to each of our entities, we ensure the Group achieves more than the sum of its parts.
Our businesses adhere to a common standard ensuring that we provide the best performance/ cost ratio in the industry. To make this happen, we seek our competitive advantage along five dimensions:
– People excellence > Recruit and develop the best people in the industry – Leading innovation > Introduce the right products and services at the right time – Long-term partnership > Engage with our customers, constantly looking for opportunities to improve for mutual benefit – Continuous cost efficiency improvements > Create the opportunity to provide best customer value and to invest in our future – Setting industry quality standards > Maintain rigorous processes to ensure our high standards
While spanning the globe, our activities remain close to our customers
The world’s growing population has a right to access top quality goods. We play a pivotal role in making these goods available through safe, cost-efficient, environmentally friendly and appealing packaging.
Being a global player, we acknowledge that local markets have different needs. Wherever our strengths can be applied, we respond to these needs by developing the appropriate products and services for local requirements, while also building long-term relationships at a local level respecting different cultures and languages.
15 Strategy
The Group maintains its strategy and confirms its management approach in the medium and long term.
16 Bobst Group Annual report 2010 Strategy
Basis of strategy The strategy is based on: – the evaluation of the position of the Group in its existing markets and its potential development to become or remain Number 1; – the opportunities for further expansion both in the markets already served as well as in new markets.
Starting position As the development of its potential in its existing worldwide markets is offering very interesting top line and profitability growth perspectives, it is not foreseen to invest in totally new activities in, or even outside, the packaging industry.
Four clear strategic objectives Four strategic objectives have been defined. The two first ones determine the growth directions the Group will embrace in the years to come. The two others lay out the internal prerequisites to achieve the growth ambitions.
1. Grow within the core 2. Expand in “neighbor” fields 3. Achieve operational excellence 4. Effective organization (Modus business Quite a few markets close A number of fields with operandi) The existing business offers to the existing activities of further potential for strong Markets’ demands as well as interesting growth potential the Group offer growth improvement in the Group’s customers’ expectations create which has, at this stage of opportunities which have internal processes have been quite a complex challenge for the Group’s development, to be thoroughly evaluated. identified: Lean production; the Group to address. The main still not yet been fully leveraged. Penetrations can take place optimize supply chain; continue focus will be to simplify structures, The expansion of the service either through organic purchasing excellence; get harmonize core processes and offering (with Business Unit development or through maximum technology synergies leverage the size of the Group Services), the penetration into acquisitions. Potential exists within product lines (R&D); wherever worthwhile. A Shared emerging markets, the further upstream, downstream or introduce Group Technology to Service Organization will development of products in inside the value chain of the enforce standardization, enable drastically simplify the back office. the so-called medium segment Group’s customers. These use of platforms, modules and (high quality, simple, lower opportunities have to be common components; use of investment equipment) are the explored in the light of their same technologies to allow the main directions offering still added value potential for Group to improve each Business untapped growth opportunities. shareholders. Unit’s profitability; develop stronger market presence; and push decision making near customers’ demand.
Concrete plan of action laid out These four strategic objectives have resulted in a number of planned initiatives, which take and will take place, within the available resources and competences, in the years to come.
This set of actions will bring the Group into a state of incomparable efficiency in the industries it serves, making it both the preferred supplier of equipment and services and one of the most attractive investments among the listed engineering companies active in the graphic arts and packaging industries. This is the ambition of the Group.
17 Organization
Bobst Group’s principle is to be as close as possible to its customers and their specific needs. For each of the three Business Units, from Research & Development to sales, including all the transverse functions, the Group applies common rules which allow it to optimize all its activities.
Structural organization of the Group
Folding Carton Industry Bobst Group Customers Corrugated Board Industry Flexible Materials Industry
Business Unit Business Unit Business Unit Sheet-fed Web-fed Services Corporate and transverse functions
Supply, Production and Logistics
18 Bobst Group Annual report 2010 Organization
Several principles on key success factors have guided the Board of Directors and management in their decisions concerning the organization of the Group.
Recognizing the importance of the specific characters of the Group activities, three Business Units, each with its own management, have been created in 2010.
In addition to this, Corporate functions such as Group Finance, and Group Supply, Production and Logistics are centrally managed.
Certain transverse functions have the duty to provide support to the organization and ensure coherence within the Group. They include: Human Resources, Legal, Information Technology, Technology Management and Communication. Controlling and risk management complete these functions.
The organization is managed based on the following principles: – the simplification of processes and management will be applied; – the speed of adaptation to changing markets and business environments being of utmost importance, the accountability and the decision-making are placed closer to the markets; – the quality of the personnel and management is recognized as one of the main assets of the Group. For this reason, the organization is designed to provide a challenging and dynamic environment in order to attract and retain the most competent people; – the structure chosen takes into account that the Group will increasingly focus its internal activities on specific value adding functions and that all of the back office will be organized in regional operational centers.
This organizational structure allows the Group, in a changing environment, to rapidly anticipate market needs and transform them into equipment and service innovations. At the same time, it offers very close local presence, by industry, to customers worldwide, thereby strengthening exchanges in the culture of each country.
19 Global network
Bobst Group has production facilities in eight countries, as well as a sales and services network with offices in more than fifty countries. These strong foundations support the Group’s position of leadership in its various Business Units. The motivation behind the sales and services organization is the desire to assist customers in their continuous pursuit for better quality, higher productivity and lower operational costs.
20 Bobst Group Annual report 2010 Global network Europe Americas Asia/Oceania Africa
Austria n Argentina n Australia n Egypt n Belgium n Brazil n n n China n n Morocco n Croatia n Canada n India n n n South Africa n Cyprus n Chile n Indonesia n n Tunisia n Czech Republic n Mexico n Israel n Denmark n n Paraguay n Japan n n Finland n Peru n Korea n France n n Rep. of El Salvador n Malaysia n n Germany n n n United States n New-Zealand n Greece n Pakistan n Italy n n n n Philippines n Latvia n Saudi Arabia n Poland n Singapore n Portugal n Taiwan n n Romania n Thailand n n Russia n Turkey n Serbia n United Arab Emirates n Spain n n Vietnam n Switzerland n n Sweden n Ukraine n United Kingdom n n n n Group production sites with sales and services n Group companies and representative offices for sales and services n Agencies and representatives for sales and services n Companies for reconditioning of equipment n Strategic partner
21 Business Unit Sheet-fed A unique power for innovation serving the folding carton and corrugated board industries.
The world renowned equipment of the Bobst, Asitrade, and Martin brands is considered the reference in the folding carton and corrugated board industries. The immense success of the Competence ’10 open house, during which six world premieres were introduced to the market, once again confirmed the vanguard reputation of the Business Unit Sheet-fed.
Results of the Business Unit Sheet-fed In million CHF
Sales Operating result
2009 2010 2009 2010 1000 180
500 0
0 -180 462.5 607.5 -160.9 -0.1 -34.8% n.v. at average exchange rates, as % of sales. current year.
Bobst’s new Masterfoil 106 PR is redefining industry standards in terms of precision, quality, productivity, ergonomics, and applications.
22 Bobst Group Annual report 2010 Business Unit Sheet-fed 23 Expertfold and Logipack: the cost effective solution for producing heavy solid board, double wall, and litho-laminated microflute packaging.
Market evolution Following the crisis of 2009, folding carton and corrugated board packaging volumes increased in all regions during 2010. The fast growing emerging markets, sustained by strong internal Equipment for printing, hot foil demand, contributed substantially to the worldwide recovery. In Western Europe and North stamping, diecutting, folding America, the converting companies of both industries faced continuous pressure on their and gluing as well as peripheral equipment for folding carton margins, in particular due to the increasing cost of raw materials. In this environment, their and corrugated board. ability to differentiate themselves from their competition became even more important, and led to a need for investment in high-end printing and converting equipment. After a very difficult year 2009, and despite the strength of the Swiss franc, the level of order bookings recovered significantly during 2010, both in emerging and mature markets. In South America and Eastern Europe (including the CIS), the Business Unit (BU) Sheet-fed recorded impressive sales volumes, more than doubling in twelve months, thanks to a broad range of Equipment for the manufacture products covering a large spectrum of investment requirements. of single face corrugated board, microflute, and litho-laminated board. Evolution of product range Continuous focus on innovation allowed the BU Sheet-fed to stay ahead of its competition. 2010 saw the materialization of the intense efforts made by the R&D teams in the introduction of six major innovations during the September Competence ’10 open house. Folding carton customers now benefit from the new Bobst Masterfoil 106 PR hot foil stamping press, which can foil and emboss with unmatched precision, in one pass, at speeds of 8'000 sheets per hour. Equipment for the printing, rotary diecutting, folding, For the corrugated board industry, the new Bobst Masterflex-HD flexo printing line features and gluing or stitching of corrugated board cases, a “Start & Go” system that allows very quick set-up times and reduces waste. Moreover, its including peripheral equipment. proactive register system and 100% quality control device (iQ300) ensure outstanding printing results. The Bobst Expertcut 1.6 flat-bed diecutting press brings precision and consistency to the mid range, diecutting at 6'000 sheets per hour. The Bobst Expertfold 300 is a modular folder-gluer for various substrates, with fast make-ready and reduced energy requirements. It is also available in-line with the new Logipack automatic packer. The Bobst FS Polyjoiner 400 is aimed primarily at the display market and offers the highest degree of accuracy in joining up to three blanks together. Masterflute, the latest generation of Asitrade litho-laminators, laminates lightweight pre-printed sheets onto single faced corrugated at speeds never achieved before, and with unprecedented sheet positioning accuracy.
24 Bobst Group Annual report 2010 Business Unit Sheet-fed Masterflex-HD, the new reference in the high definition flexographic printing of high value-added corrugated packaging.
Main events Competence ’10 was the major event of 2010. This open house was held in Mex/Switzerland, Grenchen/Switzerland, and Lyon/France. With a theme of “Towards Zero Fault Packaging”, customers could discover how the latest generation of Bobst Group equipment could help them produce fault free packaging. Attendance far exceeded expectations, with over six hundred companies from the folding carton and corrugated board industries attending, bringing in more than 2'000 visitors over the week.
The BU Sheet-fed also took the opportunity to host other open houses in different Bobst Group locations around the world to strengthen its relationships with customers. The Masterfoil 106 PR with its revolutionary Foil Touch In parallel, and in order to develop new business opportunities, the Business Unit also system, delivers at least 50% participated in a significant number of exhibitions, both in mature and emerging countries. longer contact between the sheet, foil, and dies than any In particular these included IPEX 2010 in the UK – an international printing and packaging other machine in the market. show where Bobst presented itself using a new and innovative approach.
Production sites The six sites active in the manufacturing of products for the BU Sheet-fed showed great flexibility in coping with the volume increase and unbalanced workload during 2010. Moreover, the factories in Shanghai/China and Pune/India extended the range of products built there.
The new Easy Foil system reduces by up to 40% the time needed to set foil webs, improving machine up-time and productivity.
25 Business Unit Web-fed Machinery and process innovators, partnering the most demanding industries today and into the future.
Bobst Group, with its Bobst, Fischer & Krecke, General, Kochsiek and Rotomec brands, is one of the world’s leading suppliers of equipment and solutions for the printing and converting of flexible materials. These solutions cover all types of films and light boards, including materials for food and other packaging, labels, wall coverings, gift wrapping, and transfer papers.
Results of the Business Unit Web-fed In million CHF
Sales Operating result
2009 2010 2009 2010 1000 100
500 0
0 -100 247.1 304.1 -43.0 6.1 -17.4% 2.0% at average exchange rates, as % of sales. current year.
Changing a print sleeve on a Fischer & Krecke FP 15-S flexographic press.
26 Bobst Group Annual report 2010 Business Unit Web-fed 27 The Fischer & Krecke FP 15-S flexographic press.
Market evolution The volume of converting business in 2010 confirmed the upward trend in flexible packaging activity. Although customers were little affected by the economic slowdown, they have still Web-fed printing, and converting reviewed their product strategies and industrial footprints. lines, equipment for sheet-fed diecutting, and foil stamping, and complete solutions for folding In mature markets a new wave of consolidations among large multinational companies gave and gluing. rise to some new global players. During the first semester, these concentrated their energies in the rationalization of manufacturing sites number and the optimization of existing resources. Meanwhile, local and regional converters looked on, not yet convinced of a sustainable recovery and strongly conditioned by the latest government austerity programs.
The emerging countries, mainly in Asia, the Middle East, and South America, took advantage Fischer & Krecke provides of quick growth, with demand for investment goods back to pre-crisis levels. flexographic printing solutions for the flexible materials and pre-printed linerboard industries. Due to the extensive Business Unit (BU) Web-fed product portfolio, 2010 showed a very strong recovery in order bookings, with a good balance between mature and emerging countries.
R&D activities and product range evolution The BU Web-fed continued to invest in the development of new products with key differentiation features. Fischer & Krecke (F&K) launched FP 15-S, a new generation of flexo machines especially conceived for the flexible packaging market. With increases in raw material costs, General provides vacuum customers have asked F&K to implement the exclusive Smart GPS pre-setting system on all web coating and metallizing machines in the range. solutions for barrier packaging, decorative, security and solar energy applications. The team of the new combined product line gravure/coating and laminating was very active introducing a new converting solution for the tobacco market, designed mainly for short runs, and bringing a 25% productivity increase. Rotomec also launched the high speed RS 4003MP HS gravure press to meet market needs worldwide for a better price-performance ratio. To meet the increasing need for solvent-less laminating among emerging countries, a new machine, SL 850, was launched. Kochsiek provides customized rotogravure printing solutions General increased its technological leadership in film for the food packaging industries, presenting for decorative printing and liquid packaging applications. a new, environmentally friendly, clear coating vacuum film metallizer. This allows the consumer to view the finished product inside the packaging while it retains its good barrier properties.
28 Bobst Group Annual report 2010 Business Unit Web-fed The new Rotomec RS 4003MP HS high speed rotogravure press for flexible materials.
Major events In May, the 50th anniversary of Rotomec was welcomed with enthusiasm by the industry and Rotomec provides rotogravure saw the main gravure converters visit the company. The BU participated also in the K2010 printing technology, coating, international exhibition held in Düsseldorf/Germany, and in various exhibitions in China, the extrusion coating and laminating Middle East, Russia, and South America. As usual, the BU organized open houses, one in solutions for flexible materials, labels, tapes and specialties. San Giorgio/Italy for the launch of the new RS 4003MP HS, and the other in Bielefeld/Germany for the launch of the new FP 15-S. The BU Web-fed continued to share its new technology, developed for the benefit of customers, via dedicated seminars held in the most significant emerging markets.
Evolution in organization The implementation of the new organization has proceeded as per objectives. Both the resizing of the new gravure product line (composed of Champlain, Kochsiek, and Rotomec), and its integration, have been successfully completed. The new gravure management team worked on the new range of combined products and looks forward to promoting them to the tobacco and decorative industries in mid-2011.
On October 1, 2010, Atlas Converting Equipment Ltd in Bedford/UK was sold in an MBO to members of the local senior management.
Production sites The three sites of the BU Web-fed had to face a year of unbalanced workload with a strong increase of volumes during the second semester. Although the management used the maximum flexibility among the work-force, the year was not completely clear of cost increases. On the other hand, all sites continued their focus on excellence and on keeping their world leading positions for the quality of their products and services.
The Bobst Lemanic® Riviera high performance rotogravure printing and converting production line for paper and board.
29 Business Unit Services A full range of solutions, from spare parts and retrofits to full machine upgrades.
The commitment from the Business Unit Services is to provide the best performing customer service in the packaging industries, and to make sure that the Bobst Group solutions in use worldwide continuously perform to their optimum capability.
Results of the Business Unit Services In million CHF
Sales Operating result
2009 2010 2009 2010 1000 100
500 50
0 0 341.9 363.7 31.0 52.6 9.1% 14.5% at average exchange rates, as % of sales. current year.
Bobst Group offers a wide range of after-sales services, including regular preventive maintenance to ensure the continued availability of equipment.
30 Bobst Group Annual report 2010 Business Unit Services 31 Openair® plasma treatment is a state-of-the-art technology that guarantees the perfect gluing of laminated, coated, and synthetic boxes, and can be fitted to any folder-gluer.
Market evolution The volume of business transacted by the Business Unit (BU) Services has grown during the year under review. Many customers have been running their equipment at close to production capacity and therefore require parts and services to maintain their machines in good working condition. The demand for services continues to increase in the emerging markets.
The BU Services activities developed very well in Europe and North America, thanks to the ability of the Business Unit to offer new service solutions adapted to the needs of these markets.
Many customers continue to look for ways to reduce the total cost of ownership of their equipment and, in some instances, are ready to invest in long-term service agreements with The new smartGPS®, available Bobst Group for the maintenance of their equipment and for its servicing whenever required. on all the Fischer & Krecke flexographic printing presses, automatically and precisely New service products adjusts both register and Only a few new service products were developed during the course of 2010 while the impression, right from the start. Business Unit focused its efforts in implementing the service organization worldwide and in significantly improving all processes to serve customers better. The newly developed and promoted service products were mostly designed around ways to improve the performance and productivity of the machines, without compromising quality.
The BU Services conducted a worldwide survey to better understand the different needs of the various markets served, in order to develop solutions which are perfectly in line with the expectations of customers.
A significant number of resources in the BU Services were allocated to the preparation and step by step implementation of a fully integrated IT solution for Bobst Group sales and service companies. This is designed to increase the processing speed of activities such as spare parts order processing, field service technician dispatching, and technical issue escalation. TAC – the Technical Assistance Organization and Bobst Group services centers Coaching service package – The Business Unit Services is now fully operational with ten Bobst Group services centers focuses in particular on improving the productivity worldwide: two of them being located in the Americas (North and South); four in Europe, achieved with machines. including Eastern Europe and the CIS; one in the Africa – Middle East region; and the final three in China, India, and Japan. These services centers have the responsibility for all service
32 Bobst Group Annual report 2010 Business Unit Services Performed by BU Services specialists, equipment audits highlight items that require attention and indicate a machine’s suitability for upgrade.
activities in the region they cover, and they rely on the technical, manufacturing, and logistic support from the manufacturing sites to deliver parts and services to the market. They are the main local contact for customers, and depending on the region, their degree of autonomy can be very high.
The key challenges are to achieve an optimum level of interaction between the services centers, product lines Research & Development, and technical support (located in Europe) to best serve clients per region and worldwide.
Main achievements and long-term view Quick and easy access to 2010 saw many important achievements by the Business Unit Services, including an increase spare parts is guaranteed by in turnover despite unfavorable exchange rates and an increase in operating profit. New a worldwide network of local service products were introduced and improvements were made in the provision of technical services centers, and through the e-Shop/InTouch online platforms. assistance and the delivery times of parts and services. Bobst Group increased its closeness to the customers and has achieved a better understanding of their present and future needs for services. Finally, new field service staff was hired to strengthen its capability to react to unforeseen problems at customers, and to perform regular proactive maintenance on their equipment.
The next challenge the Business Unit faces is to provide a service level of equal quality for all the products offered by Bobst Group. The key business success factors for the Business Unit will be the ability to rapidly serve customers worldwide, with the right products, the right skills and competences, and with competitive prices.
On Rotomec gravure printing presses, the integration of the Electronic Shaft technology with the latest generation of Registron S 5100 register control, significantly reduces waste and downtime.
33
Sustainability report
The greenhouse gas emissions linked to human activities are, to a very large extent, responsible for some of the climate change affecting the planet. Aware of its responsibilities and highly sensitive to both the environmental balance and the well-being and future development of human beings, Bobst Group is committed to reducing the environmental footprint of its sites, its machines, and its activities.
“When the winds of change blow, some people build walls, while others build windmills” (Chinese proverb).
34 Bobst Group Annual report 2010 Sustainability report
Industry and the climate: a question of commitment Bobst Group
Interview with Alban Bitz, Head of Environment, Health and Safety at Bobst Group
Global warming requires a more sustained commitment on the part of public authorities and business enterprises. How is Bobst Group demonstrating its commitment? First of all, the support of management is essential to the task, and its determination to improve the efficiency of the Company in the area of sustainable development is evident.
Bobst Group has elaborated a company-wide Code of Conduct* which all of the employees throughout the world have committed themselves to respect. Moreover, for a number of years already, it has implemented a clear policy with regard to health, workplace safety and respect of the environment, formalized in its company charter*.
Bobst Group is making every effort to conform to recognized international standards such as ISO 14001 and OHSAS 18001. All of its production sites around the world will be respecting ISO 14001 by the end of 2012.
Finally, Bobst Group is analyzing the life cycle of its sites, as well as that of its machines, in order to integrate the environmental dimension into its strategic choices.
Are Bobst Group’s clients involved in this global effort? Absolutely. Consumers, as well as states, are very aware of the impact of packaging on health and the environment. Their expectations influence the entire chain of production. So, in 2010 for example, Bobst Group had to deliver a machine accompanied by a carbon compensation certificate (see “Life cycle: the Carbon Foot Print Project”), something which gives a concrete measure of the trends developing in the market.
But in the end isn’t packaging just a waste product and thus a source of pollution? Admittedly, that’s one way of looking at the issue; but this view of packaging is very incomplete. Without wanting to minimize the impact of packaging on the ecosystem, it should be recalled that it remains indispensable for several reasons. Packaging protects a product from shocks, light, mildew, dust, grease and bacteria. It preserves its color and flavor. Finally, packaging is a very useful means of communication for providing information to the consumer, which sometimes can be crucial, for instance when a medicine or a potentially dangerous product is involved.
Taking these requirements into account, the packaging industry has made enormous progress: it has diminished considerably the negative impact of packaging by reducing its weight, by opting for recycled or labeled materials or by utilizing water-based inks. Of course, further progress remains to be made and here too Bobst Group intends to play a leading role.
How is Bobst Group positioning itself on questions of sustainability? In 2010, the Bobst company celebrated its 120th anniversary. It’s an enterprise for which continuity is a factor that makes sense. It has always demonstrated a capacity for evolving by integrating new techniques as well as adapting to diverse legal, commercial and societal expectations.
Tuned in to the needs of its partners, Bobst Group thinks globally while acting locally.
* Document available at: – www.bobstgroup.com/sustainable-development; see also for ISO and OHSAS: – www.iso.org; – www.ohsas-18001-occupational-health-and-safety.com.
35
Operational excellence: in detail and on a daily basis Bobst Group
Toward a more responsible management of travel As the 2009 figures demonstrated, the environmental impact of professional travel represents close to 10% of the greenhouse gas emissions of one production site – so 2'000 tons of CO2 equivalent for the Lausanne sites, for example.
In 2010, Bobst Group adopted a number of concrete measures to reduce its carbon footprint, including: – reduction in the volume of business travel through an increased use of videoconferencing. An overhaul of the network’s infrastructure will facilitate its use while improving its overall quality; – a more focused travel policy also contributed to a reduction of trips by airplane, particularly those taken in business class (it should be noted that the floor space assigned to each passenger being larger, business class generates more pollution); – a new vehicle procurement policy based on stricter motor engineering criteria led Bobst Group to give priority to the use of diesel engines, to reduce equipment that unnecessarily increases the weight of vehicles, and to opt for a more environmentally friendly company fleet.
For an improved management of printing materials The use of paper and printing equipment is indispensable for providing clients with the necessary instructions for use and maintenance of the equipment Bobst Group supplies to them.
However, here too, important efforts were made without compromising on the quality of services and support that the Group offers. Thus, at the Swiss sites, the replacement of 600 printing machines by 120 high-performance multifunction devices enabled a significant decrease in power consumption. Likewise, double-sided printing by default reduced paper consumption by 25%.
Following a re-evaluation of actual needs, it was also possible to reduce the amount of color printing by 60% and the volume of paper devoted to large format printing by 12%. Finally, close to 90% of the 60 tons of paper used each year comply with the FSC (Forest Stewardship Council) label aimed at promoting a sustainable forestry economy.
An ecological and... economic model All the measures taken are not only beneficial environmentally but also contribute greatly to reducing the functioning costs and thus improving the profitability of the Group companies. As a result, based on the model initially implemented in Switzerland, these measures will be extended to 80% of the Bobst Group sites by the end of 2011.
Life cycle: the Carbon Foot Print project Lausanne site, Switzerland
An essential element for governance Analysis of the life cycle of a product consists of assessing all of the environmental impacts it generates from its creation to its elimination. Such a study would determine precisely the amount of energy consumed and the pollution produced by the extraction of raw materials, the transport of goods and persons, the production process, the buildings and infrastructures involved, any peripheral services and, lastly, by the use of the machine and through its elimination.
If life cycle analysis is primarily a decision-making tool, it also makes it possible to respond to market requests for more exact information regarding the ecological impact of a product, a service or a system.
36 Bobst Group Annual report 2010 Sustainability report
A concrete example At the request of colordruck in Baiersbronn, Germany, who wanted the machine it had purchased to be delivered with a carbon compensation certificate demonstrating that the
CO2 equivalent emissions involved had been calculated precisely and then compensated through the development of a renewable energy project, Bobst Group conducted a life cycle analysis of its machine – an Expertcut® 106 PER Autoplaten® press. The study was undertaken in collaboration with the Swiss firm Quantis, whose calculation tools comply with recommendations defined by the ISO 14040 and 14044 standards. The results obtained demonstrate, for example, that the use of this machine, calculated over a lifetime of 15 to 30 years, represents more than 95% of the environmental impact generated and that this is essentially due to production waste (see “Control and performance: limit to deficiencies”) and the energy consumed.
Analysis of the life cycle: Lausanne site, Switzerland The example of the life cycle analysis performed on the Lausanne site (see diagram below) clearly illustrates that out of an annual total of 41'000 tons of CO2 equivalent generated in 2009, the transport of persons and materials is responsible for almost 42% of these emissions. The portion involving input materials (extraction, manufacture and processing of steel) is equivalent to that of the energy consumed. By extrapolation it will be possible to estimate the life cycle of other types of machines or other production sites.
Impact on climate change: categories of flows
Transportation: operations 41.63% Material inputs 26.47% Energy inputs 24.69% Infrastructure & equipment 6.97% Waste 0.24%
A necessary awareness The Carbon Foot Print project is enabling Bobst Group to integrate the issue of global warming into its overall strategy. The development of techniques and machines based on a genuine wish to reduce their impact on the environment is essential if one wishes to continue to respond to – or even anticipate – the demands of the market.
Bobst Group offers its clients equipment and services that respect the environment. This commitment also forms part of the concept of quality that unites and motivates its employees in their day-to-day operations. To conserve its position as market leader, Bobst Group will continue to sensitize and train its engineers, redefine certain standards and innovate wherever possible, create partnerships with others, and commit to constantly improving its products and behavior.
Control and performance: limit the deficiencies Bobst Group
To limit defects is to reduce costs In the area of flexographic and rotogravure printing, the waste caused by defects in production can generate returned orders and have an extremely significant environmental impact in addition to commercial consequences. To avoid such waste, Bobst Group has designed and developed a system of control that allows it to guarantee a production process which respects the quality standards defined by each client and thus avoid waste due to printing imperfections.
37
Bobst iQ300: an efficient control system The iQ300 system is composed of several high definition cameras that scan the packaging substrate used, allowing the system to detect and report numerous types of defects in real time. Thanks to this system, it is possible to react as soon as an anomaly appears during printing and to prevent the defect from worsening and affecting production. This system instills confidence in the operator of the machine, who avoids producing more than is necessary to compensate for the lack of quality, because he has better control over production.
In addition – and this is the case for the majority of iQ300 systems already installed – a remote connection allows Bobst Group engineers to analyze and advise clients in their interventions and adjustment of the machine. This solution, which fosters a great reaction capacity, also contributes to limiting the amount of travel by technical personnel.
iQ300 high definition cameras scanning a packaging substrate.
Sustainable development: application in Brazil Itatiba site, Brazil
A three-pillared concept According to the definition proposed by the World Commission on Environment and Development and ratified by the UNO during the Conference of Rio de Janeiro in 1992, sustainable development is “development that meets the needs of the present without compromising the ability of future generations to meet their own needs”. This notion is expressed in terms of three complementary dimensions: – the environmental dimension is assessed in terms of the impact an organization has on the various ecosystems in which it operates. The Itatiba site in Brazil regularly informs its employees, suppliers and clients about measures enabling a reduction in the use of natural resources, and implements preventive actions aimed at limiting pollution. The site obtained renewal of its ISO 14001 certification in 2010; – the economic dimension is assessed according to the impact a company exercises on the economic system and on the situation of all social and economic actors at the local, regional and global levels. The Itatiba site is established in a disadvantaged region; it has contributed to an improvement in the standard of living of the population there by offering training and jobs, and has promoted the economic development of the region. Today, the site employs twenty-five young trainees (twice the legal minimum) who participate in economic integration programs and are encouraged to pursue their studies; – the social dimension refers to the impact a company has on the environment and social systems of communities. The Itatiba site supports various local activities, notably via the work of charitable organizations. It also conducts a program for maintenance of the green areas in the city. Finally, its company restaurant has developed a food education initiative and is offering balanced meals to employees and visitors alike.
38 Bobst Group Annual report 2010 Sustainability report
Like the other sites of the Group, the Itatiba site is taking concrete action concerning the three poles of sustainable development. In doing so, it is responding to the needs of a company in full expansion, increasing its chances of development while contributing to the quality of life of its employees, suppliers and clients.
Environmental management: a concrete example in India Pune site, India
A well established practice By obtaining the ISO 14001 certification, a site is able to demonstrate concretely its commitment to practices that foster environmental sustainability. This is the corporate challenge taken up by the Pune site in India in 2010, with the support of the specialized firm TÜV NORD.
Pune site, India.
Preparation of the project managers began with a period of training covering issues connected with the environment and safety. An environmental management manual was also drawn up, addressed more broadly to all of the employees. Specific objectives for improvement were defined, such as filtration of water for reuse, the reduction of noise pollution, and the replacement of wooden pallets by metal stands. During the implementation of the project, three successive internal audits allowed for assessment, criticism, and improvement of the processes until certification was obtained in October 2010.
A success to be extended The implementation of an environmental management process has also demonstrated positive results in economic terms and has proven that today environmental responsibility is a fundamental component in the business development of the site. It is thus essential that this effort be extended. This is the objective pursued by the management of Pune, which is continuing measures to motivate its personnel and will conduct two new projects in 2011. Moreover, aware that environmental management only makes sense if it is applied to the entire chain of production, the Pune site will be proposing specific training to its suppliers.
39
Dashboards
The statistics for the Group now take into account eleven production sites spread over nine countries. However they no longer include the Bedford/UK site, which was sold to its management in 2010. To maintain a comparable presentation, the removal of this site is retroactive over previous years.
CO2 energy emissions The growth of the Group’s industrial activity led to a 3% increase in energy emissions. The Lausanne/Switzerland site contributed to this increase through the need to use additional heating energy to compensate for an average temperature drop of 0.6°C during the winter. The indirect emissions linked to the energy consumed represent half of the overall total emissions.
Waste management This indicator has been adapted and now covers all of the waste products generated by the company, whereas in previous years it only included metals. The economic recovery has led to an increase of 7.7% in the volume of total waste and 9.9% in metals. At the same time, the volumes of board, urban wastes and plastic materials only rose by 3.5%. 80% of these 5'100 tons of waste are recycled. This consists mainly of metals (65%) and paper/board (15%).
Electric energy The economic recovery resulted in an increase of 32% in the energy used for providing power to the infrastructures. Due to the reduction in personnel and various savings measures adopted, lighting energy was reduced by 17% – which is equivalent to an energy consumption per employee of 6'060 kWh.
Industrial accidents The number of work hours missed due to professional accidents increased by 3.8%. The construction of new factories, such as the one in Lausanne/Switzerland, which are better constructed and equipped with safer installations, will help to reduce the risks. Measures are also currently being initiated at the other sites to reverse this trend. For example, the Lyon/France sites, where workplace accidents had increased by 28%, are currently implementing a health and safety management system in compliance with the OHSAS 18001 standard.
Water management The Group endeavors continually to control and reduce its pollution discharges. In 2010, the consumption of water increased significantly. This increase was observed both for sanitary water (+4%) and for water used in the manufacturing process (+13% due to higher production). Measures are foreseen to control this development, particularly at the Lausanne/Switzerland sites (+20% in water consumption). The recuperation of rain water and the installation of new production machinery and more efficient sanitary equipment are some of the actions to be adopted to reduce water consumption.
Objectives
In 2011, the Lyon/France sites will comply with the ISO 14001 and OHSAS 18001 standards. By obtaining these certifications, the number of employees working at ISO 14001-certified sites will rise to 80% and those at OHSAS 18001-certified sites to 75%. The objective of the Group is to achieve certification of all of the production sites by the end of 2012. Following life cycle analyses of the machinery and equipment undertaken in 2010, training courses will be implemented for engineers and sales staff to increase awareness of this aspect and of sustainable development issues in the machine industry. Finally, relocation operations will begin to join the two Lausanne/Switzerland sites into one (TEAM project). This important project offers numerous positive perspectives in terms of sustainable development. It will allow both the elimination of intersite transportation and the optimization of surface use and energy supplies. In addition, a rain water recuperation system will be put in place. The project also foresees extension of the daycare center and a new company restaurant. For any questions concerning sustainable development in the Bobst Group, please send a message to [email protected].
40 Bobst Group Annual report 2010 Sustainability report Dashboards
CO2 energy emissions Waste Electrical energy
2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 40 12 70
20 6 35
0 0 0 33.48 32.72 31.28 27.85 28.71 10.5 8.9 9.5 11.9 8.7 37 33 37 59 45
2 kg CO2 per m ground surface. tons per mio GAV*. MWh per mio GAV*.
Electrical energy per employee Injury at work Water consumption
2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 8000 6 30
4000 3 15
0 0 0 5'939 5'973 5'697 5'023 6'060 3.66 3.63 4.45 4.23 4.64 18.8 21.1 18.5 18.1 19.9 kWh per employee. lost hours per employee. m3 per person.
* GAV (Gross Added Value).
41 Corporate governance
This report is established in compliance with the Directive on Information relating to Corporate Governance issued by the SIX Swiss Exchange. Bobst Group is committed to respecting principles of good corporate governance.
42 Bobst Group Annual report 2010 Corporate governance
1. Group structure and shareholders
1.1 Group structure (see also pages 18 and 19) Bobst Group SA, domiciliated in Prilly, Switzerland, is the holding company listed at the SIX Swiss Exchange and owns a number of non-listed companies as appearing on page 118. SIX SWISS EXCHANGE: BOBNN or 1268465 – ISIN: CH0012684657 – SIX TELEKURS: BOBNN,4 or 1268465,4 – BLOOMBERG: BOBNN SW press equity press enter – REUTERS: BOBNN.S. Market capitalization of Bobst Group SA as per annual report page 2.
1.2 Significant shareholders As per latest publications according to Article 20 of the Federal Act on Stock Exchanges and Securities Trading (SESTA): – JBF Finance SA: 30 July 2008: 41.23%. – Silchester International Investors Ltd: 9 November 2010: 11.53%. – Bobst Group SA: 23 July 2008: 7.25%. – Harris Associates L.P.: 4 January 2011: 3.01%.
1.3 Cross-shareholdings There are no cross-shareholdings with other companies.
2. Capital structure
The share capital of Bobst Group SA is structured in registered shares of CHF 1.–. For more information please refer to the Articles of Association which are publicly available under www.bobstgroup.com/investors.
2.1 Capital The amount of the ordinary share capital is CHF 17'810'002.–.
2.2 / 2.4 / 2.5 Authorized and conditional capital in particular / Shares and participation certificates / Dividend-right certificates The ordinary share capital is divided into 17'810'002 registered shares. There is no authorized and conditional capital, and there are no participation certificates, nor profit sharing certificates.
2.3 Changes in capital within the last three years See notes to the consolidated financial statements: page 103, note 28.
2.6 Limitations on transferability and nominee registrations There are no limitations on transferability for the shares and, therefore, no reasons for granting exceptions. Procedures and conditions for canceling statutory privileges and limitations on transferability do not apply. In order to facilitate the trading of the shares at the stock exchange, the Board of Directors may, by way of a special regulation or within the framework of agreements with financial institutions or institutions admitted to the stock exchange, accept the registration of nominees, provided that the shareholder registered as nominee undertakes at the request of the Company, to reveal the identity of the beneficial owner of the shares registered in the name of the nominee. The number of shares registered in the name of nominees shall not exceed twenty percent of the shares issued by the Company. Nominees are registered with voting rights only if they are institutions regulated by an official authority for the supervision of banks and financial institutions, and only if they agree to disclose, at the request of the Company, the identity of all beneficial owners. No nominee is registered with voting rights for more than five percent of the shares issued. The Board may grant an exception to the five percent limit. No such exception has been granted in the year under review.
2.7 Convertible bonds and warrants/options There are no convertible bonds or warrants/options.
43 3. (3.1 / 3.2) Board of Directors
Bruno de Kalbermatten Honorary Chairman.
Charles Gebhard Chairman. (1941) Swiss national. Schools and banking vocational training in Basle, Lausanne and New York. 1967-1974 Finance Dept Manager of Ciba-Geigy, Basle (Novartis). Charles Gebhard 1975-1990 Executive Vice President and Member of the Executive Committee of Jacobs Suchard AG, Lausanne and Zurich (previously Jacobs AG and Interfood AG). 1987 Stanford University. 1990-2001 Executive Vice President (until 1996) and Member of the Board of Klaus J. Jacobs Holding AG, Zurich and Barry Callebaut AG, Zurich. 1997 Management consulting. Other Board Membership: Koller Auktionen AG, Zurich.
Thierry de Kalbermatten Vice Chairman. (1954) Swiss national. BA, University of Lausanne (HEC). MBA, IMD Lausanne, Switzerland. 1980-1982 UBS, Lausanne and Zurich, Switzerland. 1984-1986 Rolex SA, Geneva, Switzerland. 1986-1990 Marketing Manager at Bobst Group Inc., Roseland, USA. Thierry de Kalbermatten 1990-1994 Head of Logistics Department at Bobst SA. 1994-2005 Member of Bobst Group Executive Committee. Other Board Memberships: JBF Finance SA, Vice Chairman and Shareholder. FAG Graphic Systems SA, Member.
Christian Engel (1966) German national. Bank Clerk and Diplom-Kaufmann, University of Mannheim. 1992-1994 Assistant Teacher to the Chair for International Management, European Business School, Oestrich Winkel. 1994 Sales Department BHS Corrugated. 1995 Managing Director BHS Corrugated. 2000 Chairman of the Management Board of BHS Corrugated. Other Board Memberships: Member of various boards within the BHS organization. 2007 Chairman of the Amberg-Weiden University Advisory Board. Christian Engel
Hans Rudolf Widmer (1943) Swiss national. Dr. Jur. University of Zurich. MBA, University of Pennsylvania, USA. 1970-1976 UBS, Zurich. 1976-1991 Jacobs Suchard AG, Zurich (various positions, 1989-1991 Group CFO). 1991-2003 CFO Rieter Holding AG, Winterthur, Member of the Group Executive Committee. Member of the Swiss Exchange (SIX) Panel of Experts on Accounting issues (until 2004). Chairman of the Swiss Takeover Board of the Swiss Federal Banking Commission (until the end of 2007).
Hans Rudolf Widmer
44 Bobst Group Annual report 2010 Corporate governance Michael W.O. Garrett (1942) British and Australian national. Graduate of IMD Business School Lausanne. 1961-2005 Nestlé: Market Head Australia and Japan and Executive Vice President, responsible for Zone Asia-Oceania-Africa & Middle East. Other Board Memberships: Nestlé India, Prudential plc UK, Hasbro Inc. USA and Gottex Fund Management Holdings Limited in Guernsey. Chairman of the Evian Group (the Europe-Asia forum for debating the framework of the global economic order). Member of the Development Committee of the Board of the International Business Leaders Forum (IBLF) as well as Member of the Swaziland International Business Advisory Panel under the auspices of the Global Leadership Foundation (GLF) London. Michael W.O. Garrett
Ulf Berg (1950) Swiss national. Diploma and PhD Mechanical Engineering, Technical University of Denmark. 1999-2001 CEO of Carlo Gavazzi Holding Ltd, Zug, Switzerland. 2003-2004 CEO of SIG Beverages Int. Ltd, a division of SIG AG, Switzerland. 2004-2009 Chairman and CEO of Sulzer Ltd, Switzerland. Owner of EG Energy Group Ltd, Zug, Switzerland. Partner of BLR & Partners AG, Thalwil, Switzerland. Other Board Memberships: EMS Chemie Holding SA, Switzerland, SAG GmbH, Langen, Germany, MCV LLP, Midland, Michigan, USA, Kommunekemi A/S, Nyborg, Denmark.
Alain Guttmann (1958) Swiss national. Ulf Berg MScE, University of Lausanne (HEC). 1983-1986 Marketing brand manager for Jacobs Suchard. 1986-1996 ICME Management Consulting Lausanne and Paris: Associate and Managing Director. 1996-2000 Ernst & Young Consulting: Vice President Central Europe and Managing Director for Switzerland. 2000-2004 Founder and associate of SFF Financial Services. Since 2004 Founder and associate of CapD consulting. Other Board Memberships: Golay Buchel Holding SA, Festina Group Switzerland SA, JBF Finance SA, Origins holdings.
Alain Guttmann
45
3. Board of Directors
3.1 / 3.2 Members of the Board of Directors / Other activities and vested interest The members of the Board are all non executive and thus, none of them has operational management tasks for Bobst Group SA, nor for any subsidiary. None of the members of the Board has been a member of the management of Bobst Group SA, nor of any subsidiary for the last three years. None of the members of the Board has significant business connections with Bobst Group SA or any subsidiary (see also 5.4.5).
3.3 Elections and terms of office (see table below) The members of the Board are elected for a period of three years. Elections are individual and staggered in order to obtain the reappointment or the election of approximately one third of the Board each year.
Members of the Board Since Present term ends
Charles Gebhard, Chairman 2003 2013 Thierry de Kalbermatten, Vice Chairman 2005 2011 Christian Engel 2001* 2011 Hans Rudolf Widmer 2004 2012 Michael W.O. Garrett 2005 2012 Ulf Berg 2006 2013 Alain Guttmann 2009 2012
* Until 20.08.2001 as member of the Board of Bobst SA before the creation of the holding company Bobst Group SA.
3.4 Internal organizational structure The Board has a Chairman and a Vice Chairman; it also has a Secretary who is not a member of the Board.
The Board meets at least five times per year in order to deal with the items on the agenda prepared by the Chairman. In 2010, the Board met five times, for three full day meetings and two half-day meetings. Four meetings were attended by all Board members and one meeting was attended by six out of seven Board members.
The Board members receive for each meeting the necessary documents in advance. The Board meetings are usually held at the head office of Bobst Group SA, but occasionally, the Board convenes at the site of one of the Group companies, or at any other interesting business related location. While from time to time, the Board meets with only its members present, as a rule all members of the Group Executive Committee are present and inform the Board about the activity in their respective area of responsibility.
The Committees of the Board meet in between Board Meetings and report to the Board.
They are: A Compensation and Nomination Committee, having as members Michael W.O. Garrett (Chairman) and Ulf Berg (member), which is competent to decide certain matters subject to the approval of the Board.
The Compensation and Nomination Committee consists of between two and three non executive, independent directors. An independent director is free of any relationship that could influence his or her judgment as a Committee member due to his or her employment by the Company or a company of the Group during the three years prior to the nomination to the Compensation and Nomination Committee. The term of their office is for three years or until such date as a member leaves the Board.
46 Bobst Group Annual report 2010 Corporate governance
The Compensation and Nomination Committee, for the nomination purposes, performs the following functions: – make recommendations to the Board concerning the size of the Board that the Committee believes to be appropriate; – review Board policies on age and term limits for Board members; – propose to the Board the criteria for the selection of candidates for election or re-election to the Board of Directors by the shareholders; – prepare a shortlist of candidates in accordance with the criteria adopted by the Board; – evaluate and propose to the Board candidates for Board membership as well as the re-election or removal of Board members; – recommend to the Board the appointment of members of the Board to become Chairman, Vice Chairman and members of a Board Committee; – prepare an orientation program for new Board members and an ongoing education program for existing Board members; – recommend to the Board the appointment of a person as CEO; and for the compensation purposes, applies the following policy: – submit to the Board for approval the main elements of a compensation system for the Board and the Group Executive Committee (GEC) which respects the following principles: > simplicity, clarity, coherence; > competitive remuneration to attract competent staff; > to the extent possible, the interests of the management are aligned with the interests of the Company; > actual remuneration paid is plausible when compared with individual and Group performance; > the variable part of the compensation depends on objective criteria and does not neglect criteria which are less readily measurable; > a part of the variable compensation is paid in the form of an allocation of shares of the Company. The shares are blocked for a number of years in order to align the actual compensation with longer-term goals of the Company; > avoidance of “unintended” incentives; > comparison with a group of peers whose choice is plausible and relevant when compared with the Company; – review the current compensation system for the members of the Board and submit amendments to the Board for approval; – review the current compensation system for the members of the GEC and submit amendments to the Board for approval; – review the current pension plan for the members of the GEC and submit amendments to the Board for approval; – recommend to the Board the individual compensation to be paid to the members of the Board, pursuant to their various functions and responsibilities, and submit the proposals to the Board for approval; – approve, upon proposal of the Chair of the Board, the total Compensation of the CEO, and inform the Board of such total Compensation. The final decision rests with the Board; – approve upon proposal of the CEO, the total Compensation of each ordinary member of the GEC, and submit the total compensation for all ordinary members of the GEC to the Board for approval of the total amount of compensation and inform the Board of the total remuneration paid to all members of the GEC.
The Compensation and Nomination Committee meets at least twice a year. In 2010, its members met three times for half a day. The Committee may obtain information from members of the management of the Company and may consult external advisors or counsel. The Chair of the Compensation and Nomination Committee informs the Board on its decisions. The Compensation and Nomination Committee submits an annual report on its activities to the Board during its meeting in the fall of each year.
An Audit Committee, having as members Hans Rudolf Widmer (Chairman), and Alain Guttmann (member), which is competent to decide certain matters subject to the approval of the Board, meets as frequently as necessary. In 2010, its members met three times of which two were two thirds day meetings and one was a half-day meeting.
47
All meetings were attended by all Audit Committee members, with the Chairman of the Board, the Chief Executive Officer and the Chief Financial Officer, also attending. The Audit Committee consists of between two and four non executive, independent directors. An independent director is free of any relationship that could influence his or her judgment as a Committee member due to his or her employment by the Company or a company of the Group during the three years prior to the nomination to the Audit Committee. A majority of the members of the Audit Committee and its Chair must have a sound knowledge of finance and accounting.
The primary function of the Audit Committee is to assist the Board in fulfilling its oversight responsibilities by reviewing: – the financial statements of the Company and the consolidated financial statements of the Group that will be provided to the shareholders; – the Internal Control System in the Company and the Group that the Group Executive Committee (GEC) and the Board have established; – the risk evaluation presented by the management.
The Committee is authorized to receive all pertinent information from the Group Executive Committee and has access to the reports established by the internal audit and the risk management.
The Audit Committee will, among other responsibilities, propose to the Board the external auditors for Company and Group audits, confirm and ensure the independence of the external auditors, including a review of consulting services provided by the external auditors and the fees paid for them, approve the audit plan by the external auditors and may ask the auditors to enlarge their audit to include specific issues.
A Strategy Committee, consisting of Thierry de Kalbermatten (Chairman), Charles Gebhard (member) and Michael W.O. Garrett (member). In 2010, the Committee did not meet in special sessions, because the Board met five times. During most of the year 2010, the Board was monitoring the Group transformation program. The Strategy Committee is composed of between two and four non-executive directors. A majority of its members must be independent. An independent director is free of any relationship that could influence his or her judgment as a Committee member due to his or her employment by the Company or a company of the Group during the three years prior to the nomination to the Strategy Committee. The term of their office shall be for three years or until such date as a member leaves the Board, whichever is earlier. The members are re-eligible.
The function of the Strategy Committee is to assist the Board in fulfilling its duties by providing independent and objective review and advice to the Board and Chief Executive Officer with respect to the development and implementation of Group Strategy.
3.5 Definition of areas of responsibility Pursuant to the Regulations adopted by the Board:
The Board delegates the management of the Company and the Group to the CEO who chairs the Group Executive Committee. The Board retains the attributions which are expressly conferred to it by law or the Articles of Association, and in particular the attributions which cannot be delegated pursuant to Article 716a of the Swiss “Code des Obligations”.
In addition, the Board retains the competence: – to determine the strategy and the goals of the Company and of the Bobst Group, and to determine the criteria for their financial management; – to approve the annual budget of the Company and the consolidated budget and to approve modifications of the budgets approved and capital expenditures not budgeted; – to approve the annual accounts to be brought before the Annual General Meeting of Shareholders for adoption, and to review financial guarantees and other off-balance sheet items on an annual basis; – to supervise the execution by the CEO of the management duties delegated to him;
48 Bobst Group Annual report 2010 Corporate governance
– to designate and revoke the members of the Group Executive Committee as proposed by the CEO; – to designate and revoke the persons authorized to engage the Company with their signature, with or without registering them in the “Registre du Commerce”; – to determine the compensation of the members of the Board pursuant to Article 28 of the Articles of Association; – to determine the compensation system for the members of the Group Executive Committee; – to verify the Internal Control System and the Risk Evaluation Process; – to supervise the application of sound corporate governance in the Group; – to bring any issue before the General Meeting of Shareholders; – to create or dissolve affiliated companies held directly or indirectly by the Company; – to acquire or dispose of shares in other companies held directly or indirectly; – to determine the rules applicable to the acquisition or disposal of shares of the Company.
The CEO has the following main attributions: – decisions concerning the strategy of the markets and product lines of the various Business Units of the Bobst Group, based on the propositions of the Heads of the Business Units, within the limits of the strategy of the Bobst Group defined by the Board of Directors; – decisions concerning the development of new products; – preparation of the budget; – decisions concerning the policy for information technology of the Company and the affiliated companies; – decisions concerning the purchasing policy of the affiliated companies and their means of production; – management of the relations with investors and financial analysts, with the authorities and the media; – decisions regarding the human resources policy of the companies of the Bobst Group.
As of 1 January 2010, the Group Executive Committee (GEC) is composed of: – the Chief Executive Officer (CEO); – the Chief Financial Officer (CFO); – the managers of the Business Units and of Group Supply, Production and Logistics.
The Group Executive Committee has attributions detailed in the Organization Regulations of Bobst Group SA available under www.bobstgroup.com/Investors/Organization_Regulations.pdf.
3.6 Information and control instruments vis-à-vis the Group Executive Committee The Board receives a monthly report which presents the business activity, the treasury situation as well as the evolution of the key items of the balance sheet. On a quarterly basis, a detailed report compares the actual figures with the budget and forecast. In the fall, the budget of the Group is presented for approval. The Group has internal control procedures which are regularly analyzed by the external auditors.
The internal audit function provides separate evaluations of the effectiveness and efficiency of the internal control systems at the level of the Group companies. On the basis of these evaluations, recommendations for improvement are formulated. Resources for this function are organized by project with multidisciplinary teams created in relation with the type of engagement. When needed, external resources are involved. The chief audit executive establishes an annual engagements plan to determine the priorities of the internal audit activity, as well as the companies to be analyzed. The plan is based on a risk assessment, taking also into account the input of the Audit Committee and of the Chief Executive Officer. Audit results are discussed with the management of the concerned companies, who has to define deadlines and actions for the implementation of the recommendations. The chief audit executive regularly reports to the Audit Committee on the performance relative to the initial audit plan, as well as on the significant risk exposures and control issues.
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The Group has defined and set up a risks and opportunities management system, which is a systematic procedure for identifying and assessing risks and opportunities and for implementing appropriate risk control mechanisms. It is designed to enhance risk transparency and risk awareness, and thereby to ensure that opportunities can be consistently utilized and risks controlled. It is focused on and supports the achievement of the mid- and long-term objectives of the Group. Primary responsibility for risks and opportunities management is vested in the operating units as part of their business responsibility.
The Group risks and opportunities management system: – contributes to the identification of potential threats and opportunities to the Group’s asset, financial and earnings position; – is not limited to financial or insurable risks, but covers all opportunities and risks associated with business activities; – is consistently linked with the strategy development process; – promotes efficient and effective assessment and prioritization of risks and opportunities; – enhances risk response/opportunities seizing decisions; – promotes open communication on existing opportunities and risks.
A holistic approach classifies the Group into four main categories (internal: management, core and supporting processes; external: external influence factors and stakeholders), which the Group values with respect to its inherent risks and opportunities in seventy-six singular events. The most important risks and opportunities are identified, valued both qualitatively and quantitatively and then ranked according to priority by the managers of individual units in a computer-supported process. These managers prepare specific action plans for the major risks and opportunities. The results of the evaluation and approved measures are summarized in a report which is made available to the Group Executive Committee and Board of Directors.
In addition to this bottom up approach, a risk prioritization is validated yearly by the Group Executive Committee.
4. Group Executive Committee
4.1 / 4.2 Members of senior management / Other activities and vested interest This information is available on the pages 52-53 under the individual CV of the Group Executive Committee members.
4.3 Management contracts There are no management contracts with legal entities or individuals outside the Bobst Group.
5. Compensations, shareholdings and loans
All amounts stated are gross and include all special payments.
5.1 General principles Bobst Group wishes to be a reference employer, capable of attracting, keeping and motivating people with the best professional qualities.
The compensation policy is essentially based on: – a market conforming compensation, as well as – maintaining a performance culture, this in accordance with local practice in the country employing the person.
50 Bobst Group Annual report 2010 Corporate governance
5.2 Responsibility and procedure for the determination of the remuneration The Compensation and Nomination Committee makes proposals for the individual remuneration of the members of the Board and approves, upon proposal of the Chairman of the Board, the total compensation of the Chief Executive Officer and informs the Board of such total compensation.
The Compensation and Nomination Committee also approves, upon proposal of the Chief Executive Officer, the total compensation of each ordinary member of the Group Executive Committee and submits to the Board of Directors the global amount of the compensation of all the ordinary members of the Group Executive Committee for approval. For all other employees, the review of the compensation is always done with the dual approval principle. The compensations of the entire staff of the Group are examined periodically, every two to three years, on the basis of available data and of analyses supplied by independent providers country by country and for comparable companies and industries.
5.3 Compensation system
5.3.1 Board of Directors The members of the Board of Directors are all non executive and receive a fixed remuneration in cash. Travel and other expenses in relation with their mandate are reimbursed.
5.3.2 Group Executive Committee The remuneration of the members of the Group Executive Committee is composed of a fixed and a variable portion. The system is based on the table below:
Compensation system of the members of the Group Executive Committee
In % of budgeted total remuneration
Base salary Cash 50 – 60 +
Variable remuneration 90% cash, 10% vested shares of Bobst Group SA (for 3 years) 40 – 50
The variable portion is based on the parameters indicated in the table below: In % of budgeted variable remuneration
Group operating result (a) 25 Group ROCE (a) 25 Business Unit operating result (a) 0 – 20 Group Supply, Production and Logistics efficiency (a) 0 – 20 Personal objectives (b) 30 – 50
(a) Compared with the budgeted figures. (b) Represents five to ten quantitative and qualitative personal objectives fixed each year.
A gate at 70% of objectives/budget achievements is set up as well as a cap at 150%.
The Group Executive Committee is affiliated to Company pension funds complemented by additional pension coverage for a portion of the income. All Group Executive members have a notice of termination of twelve months.
51 4. (4.1 / 4.2) Group Executive Committee
Jean-Pascal Bobst Chief Executive Officer since 07.05.2009. (1965) Swiss national. Mechanical engineer HES (University of Applied Sciences), INSEAD: Service for Executive and PED (Program for Executive Development). 1991 Schindler Berlin, Production Eastern Europe. Since 1994 with Bobst: various Management positions. Board Memberships: Member of various boards within the Bobst Group organization. JBF Finance SA, Member. Foundation Aslane, Chairman. Foundation Lumière & Vie. Jean-Pascal Bobst
Christian Budry Chief Financial Officer. (1957) Swiss national. Lic.rer.pol, University of Fribourg. Swiss Certified Accountant. 1983-2001 Ernst & Young SA, Lausanne, auditor Swiss and international companies, specialist of industries in the machine and electricity sector, Managing Partner since 1997. Since 2001 with Bobst. Board Memberships: Member of various boards within the Bobst Group organization. Romande Energie Holding SA, Switzerland, Member of the Board of Directors and Chairman of the Audit Committee. PubliGroupe SA, Switzerland, Member of the Board of Directors and Chairman of the Audit Committee.
Claude Currat Christian Budry Head of Business Unit Services since 01.01.2010 and until 31.03.2011. (1951) Swiss national. Engineer degree, ETS Geneva. MBA, Western New England, USA. 1972-1974 Engineer at the Câbleries de Cossonay, Switzerland. 1974-1987 Technical Manager at Maillefer Co., USA. 1988-1994 General Manager at Nokia-Maillefer SA, Ecublens, Switzerland. Since 1994 with Bobst: various Management positions. Board Memberships: Member of various boards within the Bobst Group organization.
Hakan Pfeiffer Head of Business Unit Sheet-fed since 01.01.2010. (1967) Swedish national. Masters degree in mechanical engineering, EPFL (Swiss Federal Institute of Technology Lausanne, Switzerland). MBA, INSEAD, Fontainebleau, France. Claude Currat Since 1991 with Bobst, successively as Mechanical Engineer, Product Manager, Marketing Manager in Japan, Product Line Director folder-gluers. Board Memberships: Member of various boards within the Bobst Group organization.
Hakan Pfeiffer
52 Bobst Group Annual report 2010 Corporate governance Erik Bothorel Head of Business Unit Web-fed since 01.01.2010. (1962) French national. Master degree in mechanical engineering, Saint-Etienne National School, France. University third cycle in Automation and Artificial Intelligence, IIRIAM, France. 1986-1987 Eurocopter, France, Production Method Manager. 1987-1998 Jobs, France and Italy, successively Sales Manager, General Manager. 1998-2001 SASIB, Italy, General and Business Unit Manager. 2001-2003 Barbieri & Tarozzi, Italy, Group General Manager. Since 2004 with Bobst successively as Managing Director and Head of gravure product line at Rotomec SpA then Bobst Group Italia SpA. Erik Bothorel Board Memberships: Member of various boards within the Bobst Group organization.
Pierre-Yves Mueller Head of Group Supply, Production and Logistics since 01.01.2010. (1961) Swiss national. Mechanical engineer HES. 1985-1996 Positions in Research & Development, Production and Manufacturing with Vibro-Meter SA, Villars-sur-Glâne, Switzerland. 1997-1998 Position in Supply, Production and Logistics with Frewitt SA, Granges-Paccot, Switzerland. Since 1999 with Bobst: various Management positions.
Pierre-Yves Mueller
New member of the Group Executive Committee as of 01.04.2011
Stephan März Head of Business Unit Services. (1971) German national. Mechanical engineer, Technical University, Munich (TUM). Business administration studies (TUM). 1997-2004 Roland Berger Strategy Consultants, Germany, Senior Project Manager. 2004-2005 Georg Fischer AG, Switzerland, Head of Strategic Projects. 2006-2011 GF Agie Charmilles Group, Switzerland, successively as Head of Business Development, Head of Customer Services, Group Management Member. Stephan März
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5.3.3 Upper and middle management The remuneration of the upper and middle management is composed of a fixed and a variable portion.
According to the organizational level, the variable portion represents 10 to 40% of the fixed compensation, and depends on such factors as Group operating results, and Group ROCE, and/or direct responsibility results and/or bookings and sales and achievement of personal objectives fixed each year. All amounts are paid in cash. Management is affiliated to Company pension funds, according to conditions and regulations and/or labor market competitiveness.
5.4 Compensation for members of governing bodies
5.4.1 Total remuneration of the Board of Directors In 2010, the Board of Directors has decided to reduce the annual fees of the Board members by 10%. The total remuneration granted in 2010 to the members of the Board of Directors amounts to CHF 1.33 million.
Members of the Board Cash in CHF
Charles Gebhard, Chairman 309'000 Thierry de Kalbermatten, Vice Chairman 219'000 Ulf Berg 138'000 Christian Engel 138'000 Michael W.O. Garrett 138'000 Maia Wentland Forte (retired from the Board AGM 28.04.2010) 78'000 Hans Rudolf Widmer 156'000 Alain Guttmann 156'000 Total remuneration 2010 1'332'000
None of the Board members are affiliated to the Group’s pension funds.
In addition, the Group had to pay the contribution for the Federal Old Age, Survivor and Disability Insurance (AVS) and the Unemployment Insurance for a total amount of CHF 59'252.–.
5.4.2 Total remuneration of the members of the Group Executive Committee The total remuneration of the six members of the Group Executive Committee in 2010 amounts to CHF 5.85 million (details as per table below).
Base salary Variable portion Pension Payment Total plans in kind 2010
Cash CHF Cash CHF Shares CHF CHF CHF number*
Total remuneration: Group Executive Committee 2'676'480 1'638'559 4'226 1'357'213 25'920 5'854'010 Highest compensation: Jean-Pascal Bobst, CEO 678'500 593'248 1'539 397'995 4'320 1'730'815
* The value of a bonus in shares, the sale of which is blocked for a period of three years, is equal to 83.96% of their market value at the date of attribution. The share price at the date of attribution was CHF 43.92.
In addition, the Group had to pay the contribution for the Federal Old Age, Survivor and Disability Insurance (AVS) and the Unemployment Insurance for a total amount of CHF 227'128.–.
54 Bobst Group Annual report 2010 Corporate governance
5.4.3 Compensations for former members of governing bodies During the year under review, there were no compensations conferred to former members of governing bodies in relation with their former activity as governing bodies or not conform with market practice by Bobst Group SA or one of the subsidiaries.
5.4.4 Options There are no options programs.
5.4.5 Additional fees and remunerations Honorariums of CHF 8'750.– have been billed to Bobst Group SA by Mr. Thierry de Kalbermatten, who is Vice Chairman of the Board of Directors of Bobst Group SA, of CHF 334'650.– by CapDconsulting Guttmann, Lussy-sur-Morges, owned by Mr. Alain Guttmann, member of the Board of Directors of Bobst Group SA, and of CHF 11'000.– by BLR & Partners AG, Thalwil, whose associate, Mr. Ulf Berg, is member of the Board of Directors of Bobst Group SA.
5.5 Loans granted to governing bodies No loans or guarantees are granted to members of the Board of Directors or the Group Executive Committee or parties closely linked to them.
5.6 Share ownership The total number of Bobst Group SA shares owned as of 31 December 2010 by non-executive members of the Board, by Group Executive Committee members and by persons closely linked to them as per the table below:
Non-executive Number of shares Group Executive Number of shares Members of the Board owned Committee Members owned
Charles Gebhard 2'000 Jean-Pascal Bobst 4'005 Thierry de Kalbermatten 90 Christian Budry 3'851 Christian Engel 1'000 Claude Currat 5'296 Hans Rudolf Widmer 900 Hakan Pfeiffer 3'143 Michael W.O. Garrett 2'000 Pierre-Yves Mueller 600 Total 2010 5'990 Total 2010 16'895
Persons closely linked to the non-executive members of the Board and to the Group Executive Committee members are their spouse, their children under the age of eighteen, any legal entities that they own or otherwise control, or any legal or natural person who is acting as their fiduciary.
6. Shareholders’ participation
6.1 Voting rights restrictions and representation Only shareholders registered with voting rights may represent other shareholders in the General Meeting of Shareholders.
There are no other voting-rights restrictions, nor statutory Group clauses, etc. and therefore no definition of reasons for granting exceptions is necessary.
Procedure and conditions for abolishing statutory voting rights restrictions: not applicable. Statutory rules on participation in the General Meeting of Shareholders do not differ from applicable legal provisions.
55
6.2 Statutory quorums Pursuant to the Articles of Association of the Company, a qualified majority – two thirds of the shares represented at the Meeting of Shareholders and the absolute majority of the capital represented – is required for decisions concerning: – the rule that only a registered shareholder may represent another shareholder; – the conversion of registered shares into bearer shares; – the revocation of more than one third of the members of the board, the modification of the maximum number of members of the Board and the term of their office.
6.3 Convocation of the General Meeting of Shareholders Statutory rules on the convocation of the General Meeting of Shareholders do not differ from applicable legal provisions.
6.4 Agenda The Articles of Association (available under www.bobstgroup.com/investors) stipulate that requests for including items in the agenda of the General Meeting of Shareholders have to be made forty days prior to the date of the meeting.
Shareholders who represent shares with a total nominal value of one million francs (CHF 1'000'000.–) can ask for the inclusion of an item in the agenda.
6.5 Inscriptions into the share register The share register is closed for new registrations a few days prior to the date of the General Meeting of Shareholders.
7. Changes of control and defense measures
7.1 Duty to make an offer The Articles of Association contain an opting-out clause: the obligation to present an offer to purchase all the listed securities of the Company (Article 32 of the Federal Act on Stock Exchanges and Securities of 24 March 1995), does not apply to the owners and purchasers of shares of the Company (Article 22 subparagraph 2 and Article 52 of the Act).
7.2 Clauses on changes of control There are no agreements and schemes benefiting members of the Board of Directors and/or of the Group Executive Committee as well as other members of the management with clauses related to change of control.
8. Auditors
8.1 Duration of the mandate and term of office of the lead auditor Ernst & Young Lausanne, act as statutory auditors of the holding company since its incorporation in 2001 and as the auditors of the consolidated financial statements of Bobst Group since 1989. They also audit the Swiss affiliated companies. The responsibility of the engagements is assumed by one head auditor. He is in charge since the audit of the 2007 financial statements.
Pursuant to Article 730a of the Swiss “Code des Obligations”, a head auditor may be in charge of an audit for seven years at most.
For the affiliated companies abroad, functions of auditors are assumed mainly by Ernst & Young.
8.2 / 8.3 Auditing fees / Additional fees Fees in favor of Ernst & Young (worldwide) for the audit of the individual statements of Bobst Group SA and its subsidiaries on the one hand, and for the audit of the consolidated financial statements on the other hand for the year 2010 amount to CHF 1'194'554.–. For other professional services, additional fees in favor of Ernst & Young (worldwide) for the same period amount to CHF 297'970.–, of which CHF 278'686.– for tax advisory and compliance and CHF 19'283.– for audit related services.
56 Bobst Group Annual report 2010 Corporate governance
8.4 Informational instruments pertaining to the external audit In 2010, the external auditors met three times with the Audit Committee. The Management Letter of the external auditors is the basis for discussions on the annual financial statements. Once a year, the Audit Committee reviews the performance, independence and remuneration (based on a benchmark) of the external auditors, and submits a proposal to the Board of Directors on which auditing company should be nominated for election at the General Meeting of Shareholders. On an annual basis, the Audit Committee also reviews the scope of external auditing, approves the audit plan, and discusses the corresponding audit results with the external auditors.
9. Information policy
Bobst Group SA publishes: an annual report in French and English together with the financial statements as at 31 December containing also, next to an environmental and social report, the consolidated financial statements, source and utilization of funds, notes to the consolidated financial statements, statutory accounts with notes and the auditors reports, a half-year report in English. All these documents are available on the website.
Press releases, available the same day on the website, traditionally one at the beginning of the year announcing the consolidated Group turnover for the previous year and the outlook for the current year, one when publishing the annual report, one when publishing the half-year report, others as the need may occur pursuant to rules on ad-hoc publicity.
Conferences for financial analysts and the media: one is held the day of the publication of the financial statements, another one takes place at the beginning of December (presentations are available the same day on the website).
Annual General Meeting of Shareholders
Teleconferences for financial analysts and the media, available next day on the website: one when publishing the press release at the beginning of the year announcing the consolidated turnover for the previous year and the outlook for the current year, another one when publishing the half-year report and the related press release, others, as the need may occur.
Website links and contact
www.bobstgroup.com to reach the site home page www.bobstgroup.com/investors to reach the investors pages directly and get: – the press releases – the agenda of events – the annual and half-year reports, the recordings of the teleconferences for financial analysts and the media, and the presentations of the conferences for financial analysts and the media – the Articles of Association of Bobst Group SA www.bobstgroup.com/investors/info to order financial information [email protected] to mail questions not addressed in the above documentation
57 Milestones of the Group
1890 Joseph Bobst opens a printing supplies shop in Lausanne (Switzerland).
1908 Opening of a workshop for customer service.
1915 First production of equipment. 1917 Bobst is registered as a trademark. 1918 A joint-stock company is formed under the name J. Bobst & Fils SA.
1936 First outlet abroad with the opening of a sales office in Paris (France). 1938 Up-scaling to industrial production with the inauguration of the Prilly/Lausanne site (Switzerland).
1940 The first Autoplaten® diecutter is unveiled.
1965 Acquisition of Champlain (1938) in Roseland/NJ (USA), today: Bobst Group North America. Creation of Bobst Italiana, today: Bobst Group Italia.
1970 Creation of Nihon Bobst KK, today: Bobst Group Japan. 1974 Creation of Bobst Brazil, today: Bobst Group Latinoamérica do Sul. 1977 Beginning of the expansion at the Mex/Lausanne site (Switzerland). 1978 The company is renamed Bobst SA and listed on the Lausanne Stock Exchange for the first time. 1979 Creation of Bobst Canada.
1980 Operations begin at a factory in Maua (Brazil). 1985 Acquisition of Martin (1923) in Villeurbanne and Bron/Lyon (France). Acquisition of Peters Maschinenfabrik GmbH (1890) in Hamburg (Germany). 1987 Acquisition of a shareholding in Schiavi SpA (1927) at Piacenza and Modena (Italy). 1989 Creation of Bobst Group Benelux.
1990 Celebration of the centenary under the motto “Knowledge and People”. Creation of Bobst Group Deutschland. 1992 Opening of Bobst Group Africa & Middle East (Tunisia). 1993 Acquisition of Asitrade AG (1975) in Grenchen (Switzerland). Creation of Bobst Group Central Europe (Czech Republic). 1994 Creation of Bobst Group Malaysia and of Bobst Group Taiwan. 1995 Creation of Bobst India and of Bobst Indonesia. 1996 Creation of Bobst Group Thailand. 1997 Operations begin at a factory in Itatiba (Brazil) and in Shanghai (China). Creation of Bobst Group Latinoamérica Norte (Mexico). 1998 Acquisition of Corrugating Roll Corporation (CRC) (1971) in Rutledge/TN (USA). Creation of Bobst Group Vostok in Moscow (Russia). 1999 Creation of Bobst Group Polska (Poland).
58 Bobst Group Annual report 2010 Milestones 2000 Takeover of Fairfield Enterprises Ltd in Redditch (UK), owner notably of Oscar Friedheim Ltd (1913), Bobst agent for sales and services in the UK and Ireland. Strategic partnership agreement with BHS Corrugated Maschinen- und Anlagenbau GmbH in Weiherhammer (Germany). Creation of Bobst Group Scandinavia (Denmark) and of Bobst Group (UK & Ireland). 2001 Adoption of a new legal structure. Bobst SA henceforth focuses on the development, production and marketing of its products and services. Shareholding management is provided by Bobst Group SA. Expansion of the factories in Shanghai (China) and in Itatiba (Brazil). 2002 Implementation of an operational organization by business area and of a market organization common to all the companies of the Group. Construction of a factory in Pune (India). Creation of a representation office in Kiev (Ukraine). 2003 Martin acquires Rapidex (1917) in Angers (France) and expands the factory in Bron/Lyon (France). Creation of Bobst Group Ventas y Servicios España in Barcelona (Spain), today: Bobst Group Ibérica, S.L. 2004 Acquisition of the converting business (flexible materials) of Metso Corporation (Finland), consisting of 5 partners: Atlas, General, Midi, Rotomec and Titan. Majority shareholding in Steuer GmbH Printing Technology in Leinfelden (Germany). 2006 The Palatine Engraving Co. Ltd and Lasercomb Dies Ltd, both not active in the Group’s core business, are taken over by their management. The companies Rotomec SpA, Schiavi SpA and Bobst Italia SpA merge into one company under the name of Bobst Group Italia SpA. The brand names Rotomec and Schiavi continue to be used for the respective products. 2008 Expansion of the operations in the flexible materials market worldwide with the acquisition of Fischer & Krecke GmbH in Bielefeld (Germany). Implementation of an organizational change whereas the complete sales and services activities are integrated into the business areas. 2009 Closure of the plants FAG in Avenches (Switzerland) and Rapidex in Angers (France). Jean-Pascal Bobst becomes CEO as of 7 May 2009. In August, a transformation program of unprecedented size and speed was launched, alongside a cost reduction program aimed at achieving savings of CHF 100 million for 2011. 2010 Implementation of an organizational structure by Business Unit and introduction of a lean production concept. Approval of TEAM project, which aims at consolidating the Bobst SA operations on one single site in Mex (Switzerland). Sale of the land and buildings located in Prilly (Switzerland). Atlas Converting Equipment Ltd in Bedford (UK), with its brands Atlas and Titan, is sold to its management.
59 60 Bobst Group Annual report 2010 Financial statements 2010
Bobst Group Financial statements 2010 61 Contents
63 Comments 111 Note 39 Capital commitments Bobst Group, consolidated financial statements 111 Note 40 Exchange rates 65 Consolidated profit and loss 112 Note 41 Board and Executive compensation 66 Consolidated statement of comprehensive income disclosures as required by Swiss law 67 Consolidated balance sheet as of 31 December 117 Note 42 Risk assessment disclosures 68 Consolidated cash flow statement as required by Swiss law 69 Changes in consolidated equity 118 List of the Group companies 70 Notes to the consolidated financial statements 119 Report of the Group auditors 70 Note 1 General information Bobst Group SA, statutory accounts 70 Note 2 Significant accounting policies 121 Balance sheet at 31 December 80 Note 3 Significant accounting judgements, of Bobst Group SA estimates, financial risk and capital 122 Profit and loss statement of Bobst Group SA management 123 Notes to the financial statements and proposal 84 Note 4 Sales for the appropriation of available earnings 84 Note 5 Other operating income (Bobst Group SA) 84 Note 6 Raw materials and services 125 Report of the statutory auditors 84 Note 7 Personnel costs 85 Note 8 Depreciation and amortization 85 Note 9 Other operating expenses 85 Note 10 Financial result 86 Note 11 Income tax 86 Note 12 Earnings per share 86 Note 13 Assets and liabilities classified as held for sale 87 Note 14 Segment reporting 89 Note 15 Intangible fixed assets 91 Note 16 Goodwill 91 Note 17 Research & Development 92 Note 18 Tangible fixed assets 94 Note 19 Investments in associates 95 Note 20 Receivables and prepaid expenses 95 Note 21 Finance lease receivables 96 Note 22 Credit risk related to client receivables 97 Note 23 Derivative financial instruments 98 Note 24 Borrowings 99 Note 25 Analysis and other information related to financial instruments and capital management 102 Note 26 Deferred taxes 102 Note 27 Inventories 103 Note 28 Share capital 103 Note 29 Dividends 104 Note 30 Provisions 105 Note 31 Pension plans and other employee benefits 107 Note 32 Share-based payment compensation 108 Note 33 Business combination 108 Note 34 Disposal of subsidiaries 109 Note 35 Changes in the scope of consolidation 110 Note 36 Related parties 111 Note 37 Subsequent events 111 Note 38 Contingent liabilities
62 Bobst Group Financial statements 2010 Contents Comments
2010 started with a weak backlog. During the year, a slow but steady increase in order entries was noticed.
2010 was impacted by transformation costs and one-time events that significantly influenced the Group results. In particular, the Group realized significant profits on the sales of fixed assets located in Switzerland. Approximately CHF 15 million of the profit on fixed assets disposal generated cash in 2010, whereas the remaining amount will be paid in future years.
In million CHF
Group restructuring and transformation costs -9.9 Release of restructuring provisions 1.7 Profit on fixed assets disposals 77.4 Exceptional losses on assets -2.5 Other one-time costs -1.1 Net positive impact on Operating Result 65.6 Calculated tax impact -14.5 Net positive impact on Net Result 51.1
In 2009, the net impact of one-time events (mainly restructuring and transformation costs) was negative and amounted to CHF 69.1 million at the operating result level and to CHF 54.2 million at the net result level.
Sales In 2010, the Bobst Group consolidated sales amount to CHF 1.280 billion, representing an increase of CHF 225 million or +21% compared to 2009. This evolution is due to the following elements: In million CHF %
Evolution of volume 298 28.2 Change in the scope of consolidation -13 -1.2 Evolution of exchange rates -60 -5.7 Total Evolution 225 21.3
The geographic distribution shows a general increase in all zones.
2010 2009 Variance In million CHF In million CHF in %
Europe 618 559 10.6 Americas 372 251 48.2 Asia & Oceania 249 217 14.7 Africa 41 28 46.4 Total 1'280 1'055 21.3
Bobst Group Financial statements 2010 Consolidated financial statements 63 Comments
Operating Result The operating result significantly improved from a loss of CHF 175.2 million in the previous year to an operating profit of CHF 61.3 million in the reporting year. Without the transformation costs and the one-time events influence, the underlying operating result would show a slight loss of CHF 4.3 million in 2010 compared to the underlying operating loss of CHF 106.1 million in 2009, which represents an improvement of CHF 101.8 million.
Business Unit Business Unit Business Unit In million CHF Sheet-fed Web-fed Services Other
Published Operating Result -0.1 6.1 52.6 2.7 Restructuring/one-time events -50.3 -4.6 -7.8 -2.9 Underlying Operating Result 2010 -50.4 1.5 44.8 -0.2 Underlying Operating Result 2009 -118.8 -31.2 46.1 -2.2
The underlying operating result 2009 by Business Unit is the result of a restatement prepared at the beginning of 2010 and is based on the best understanding of the new organization existing at that time. The Business Unit Services remunerates the Business Units Sheet-fed and Web-fed for the right to sell spare parts and services on the new installed machines. This amount (CHF 24.3 million in 2010) is based on the volume of machine sales and represents additional future sales potential for the Business Unit Services.
Net Result The net result reaches CHF 49.3 million. Excluding the transformation costs and the one-time events influence, the net result would have reached CHF -1.8 million. The net result attributable to the shareholders represents an earning per registered share of CHF 2.98 (2009: CHF -9.73).
Shareholders’ Equity The consolidated shareholders’ equity amounts to 35.2% in relation to the total balance sheet (33.0% in 2009).
Dividend Proposal Due to the fact that the profit realized in 2010 is mainly due to one-time revenues, and that the cash impact of a big part of these revenues is not yet realized, the Board of Directors will not propose the payment of a dividend to the Annual General Meeting of Shareholders (CHF 0.– in 2009). This decision is not in line with the Group’s dividend policy which recommends a payout ratio of around 50% of the net consolidated profit after taxes, but aims at recovering an equity ratio in accordance with the Group’s capital management objective (40-45%).
64 Bobst Group Financial statements 2010 Consolidated financial statements Consolidated financial statements Consolidated profit and loss
In million CHF
Notes 2010 2009
Sales 04 1'280.2 1'055.5
Other operating income 05 92.4 16.2 Raw materials and services 06 -804.6 -679.4 Personnel costs 07 -458.0 -513.8 Depreciation and amortization 08 -33.1 -45.5 Other operating expenses 09 -15.6 -8.2 Operating result 61.3 -175.2
Share of result of associates 19 2.8 -1.4 Result before financial result and income tax 64.1 -176.6
Interest expenses 10 -24.3 -19.8 Other financial expenses and income 10 22.7 3.3 Result before income tax 62.5 -193.1
Income tax 11 -13.2 32.4 Net result 49.3 -160.7
Attributable: To shareholders 49.3 -160.7 To non-controlling interest 0.0 0.0
Earnings per registered share (in CHF) 12 2.98 -9.73 Diluted earnings per registered share (in CHF) 12 2.98 -9.73
Bobst Group Financial statements 2010 Consolidated financial statements 65 Consolidated statement of comprehensive income
In million CHF
2010 2009
Net result for the period 49.3 -160.7
Currency translation differences -50.6 13.7 Net result on cash flow hedges 2.0 0.4 Income tax -0.8 -0.2 Other comprehensive income / loss for the period, net of tax -49.4 13.9
Total comprehensive loss for the period -0.1 -146.8
Attributable: To shareholders -0.1 -146.8 To non-controlling interest 0.0 0.0
66 Bobst Group Financial statements 2010 Consolidated financial statements Consolidated balance sheet as of 31 December
In million CHF
Notes 2010 2009
Intangible fixed assets 15 46.3 41.9 Goodwill 16 68.6 80.6 Tangible fixed assets 18 260.3 282.0 Financial assets other 2.7 1.9 Investments in associates 19 55.8 63.6 Employee benefits 31 66.2 50.4 Receivables and prepaid expenses 20 95.5 12.2 Finance lease receivables 21 17.1 22.3 Derivative financial instruments 23 0.1 0.9 Deferred tax assets 26 33.2 36.8 Non-current assets 645.8 592.6
Inventories 27 355.4 403.3 Receivables and prepaid expenses 20 277.4 290.4 Finance lease receivables 21 15.5 22.0 Income tax receivables 16.5 12.2 Derivative financial instruments 23 19.0 5.8 Cash and cash equivalents 313.8 424.6 Assets classified as held for sale 13 0.0 1.8 Current assets 997.6 1'160.1
Total assets 1'643.4 1'752.7
Share capital 28 17.8 17.8 Reserves 510.6 720.7 Net result 49.3 -160.7 Shareholders’ equity 577.7 577.8 Non-controlling interest 0.0 0.0 Equity 577.7 577.8
Borrowings 24 362.6 472.9 Provisions 30 3.8 6.8 Pension plans and other employee benefits 31 42.0 46.1 Trade and other payables 4.9 12.2 Deferred tax liabilities 26 94.9 91.4 Non-current liabilities 508.2 629.4
Borrowings 24 114.5 126.5 Provisions 30 36.5 47.8 Pension plans and other employee benefits 31 2.5 2.7 Trade and other payables 394.0 357.2 Income tax payables 8.6 8.2 Derivative financial instruments 23 1.4 3.1 Current liabilities 557.5 545.5
Total liabilities and equity 1'643.4 1'752.7
Bobst Group Financial statements 2010 Consolidated financial statements 67 Consolidated cash flow statement
In million CHF
2010 2009
Net result 49.3 -160.7 Elimination of income from associates -2.8 1.4 Elimination of income taxes 13.2 -32.4 Elimination of depreciation, amortization and provisions 24.1 48.2 Elimination of the result on disposal of assets -71.2 0.1 Elimination of interest expenses/(income) 18.7 15.2 Changes in inventories 4.5 111.1 Changes in receivables -30.4 116.1 Changes in payables 72.1 -57.2 Paid taxes -14.1 -12.6 Cash flow from operating activities Total A 63.4 29.2
Disposal of subsidiaries, net of cash disposed -3.8 0.0 Purchase of intangible assets -9.3 -13.6 Purchase of tangible assets -33.4 -12.5 Loans and advances made -1.0 -0.7 Proceeds from sale of tangible assets 15.5 0.4 Proceeds from sale of financial assets 0.2 0.1 Loan repayments and advances received 0.5 0.2 Interest received 5.6 4.7 Dividends received 0.1 0.3 Cash flow from investing activities Total B -25.6 -21.1
Proceeds from borrowings 21.6 328.3 Repayments of borrowings -126.2 -50.1 Interests paid -24.3 -13.4 Dividends paid to Group shareholders 0.0 -0.2 Cash flow from financing activities Total C -128.9 264.6
Effects of exchange variances Total D -19.7 -0.1
Increase/(decrease) in cash and cash equivalents A+B+C+D -110.8 272.6
Cash and cash equivalents at beginning of period 424.6 152.0 Cash and cash equivalents at end of period 313.8 424.6 Variance -110.8 272.6
68 Bobst Group Financial statements 2010 Consolidated financial statements Changes in consolidated equity
In million CHF
Share Own Hedge Translation Other Retained capital shares reserve reserve reserves earnings Equity
Balance at 1 January 2009 17.8 -1.4 0.2 -32.3 0.8 740.1 725.2 Total comprehensive income / loss for the period 0.2 13.7 -160.7 -146.8 Share-based payments -0.6 -0.6 Dividends 0.0 Balance at 31 December 2009 17.8 -1.4 0.4 -18.6 0.2 579.4 577.8
Balance at 1 January 2010 17.8 -1.4 0.4 -18.6 0.2 579.4 577.8 Total comprehensive income / loss for the period 1.2 -50.6 49.3 -0.1 Share-based payments 0.0 Dividends 0.0 Balance at 31 December 2010 17.8 -1.4 1.6 -69.2 0.2 628.7 577.7
Bobst Group Financial statements 2010 Consolidated financial statements 69 Notes to the consolidated financial statements
Note 1 General information
Bobst Group SA, a company incorporated in Switzerland and having its main offices at 50, route des Flumeaux, in Prilly/Switzerland, is the holding company of the Bobst Group, worldwide leading supplier of equipment and services to packaging manufacturers in the folding carton, corrugated board and flexible materials industries.
Note 2 Significant accounting policies
The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS). The financial statements have been prepared on the historical cost basis, except for the revaluation at fair value of certain financial instruments. The principal accounting policies adopted are set out below.
Standards, amendments and interpretations effective in 2010 From 1 January 2010, the Group has applied the following new and amended or revised standards.
–– IFRS 3 Business combinations (revised) The revised standard continues to apply the acquisition method to business combinations but requires significant changes such as: >>allows a choice on a transaction by transaction basis for the measurement of non- controlling interests at the date of acquisition either at fair value or at the non-controlling interests share of recognized identifiable net assets of the acquiree. >>contingent consideration is measured at fair value at the acquisition date; subsequent adjustments to the consideration are recognized against the cost of the acquisition only to the extent that they arise from new information obtained within the measurement period about the fair value at the date of acquisition. All other subsequent adjustments to contingent consideration classified as an asset or a liability are recognized in profit or loss. >>a settlement gain or loss is recognized when the business combination in effect settles a pre-existing relationship between the Group and the acquiree. >>acquisition-related costs are accounted for separately from the business combination, leading to those costs being recognized as an expense in profit or loss as incurred, whereas they were previously accounted for as part of the acquisition costs.
In the current year, the above changes in policies have impacted the accounting for the on-going acquisition of Gordon (note 37 Subsequent event) since the acquisition-related costs have been accounted directly as an expense in profit or loss as incurred.
–– IAS 27 Consolidated and Separate Financial Statements (revised) The revised standard requires the effects of all transactions with non-controlling interests to be recorded in equity if there is no change in control and these transactions will no longer result in goodwill or gains and losses. The standard also specifies the accounting when control is lost. Any remaining interest in the entity is re-measured to fair value, and a gain or loss is recognized in profit or loss.
There has been no impact of IAS 27 (revised) on the current period as there have been no transactions with non-controlling interests.
70 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
–– Improvements to International Financial Reporting Standards issued in April 2009, included clarification on IFRS 8 Operating Segments: segment assets and liabilities need only to be reported when those assets and liabilities are included in measures that are used by the chief operating decision maker. As the Group’s chief operating decision makers do not review segment assets and liabilities, the Group has decided to discontinue to disclose this information in note 14.
The following standards, amendments and interpretations to existing standards are mandatory for the first time for the financial year beginning 1 January 2010 but are not relevant for the Group:
–– IFRS 1 (amendments), First-time adoption of IFRS – Additional Exemptions for First-time adopters –– IFRS 2 (amendments), Group cash-settled share-based payment transactions –– IAS 39 – IFRIC 9 (amendments), Eligible hedged items and embedded derivatives –– IFRIC 17, Distribution of non cash assets to owners
Standards, amendments and interpretations to the existing standards (mandatory for periods beginning on/or after 1 January 2011) that have not been early adopted by the Bobst Group
–– IFRS, 9 Financial Instruments – Classification and Measurement. This standard is the first stepn i the process to replace IAS 39 and introduces new requirements for classifying and measuring financial assets. –– IAS 24 Related Party Disclosures (revised). The revised standard modifies the definition of a related party and simplifies disclosures for government-related entities –– IFRS 7 (amendments), Transfer of financial assets –– IAS 12 (amendments), Deferred taxes, recovery of underlying assets –– Annual Improvements to IFRS, May 2010. Bobst Group has not yet finished all the analyses about these changes. Consequently, all potential impacts cannot be described yet.
The following new interpretations, amendments/revisions to standards are not relevant or are expected to have no significant impact on the Group’s financial statements: –– IAS 32 (amendments), Financial Instruments: Classification of rights issues –– IFRIC 19 Extinguishing financial liabilities with equity instruments
Basis of consolidation The consolidated financial statements incorporate the financial statements of the Company (Bobst Group SA) and entities controlled by the Company (its subsidiaries). Control is achieved where the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies in line with those used by the Group. All intra-Group transactions, balances, income and expenses (including dividends) are eliminated during the consolidation.
Bobst Group Financial statements 2010 Consolidated financial statements 71 Notes to the consolidated financial statements
Non-controlling interests are identified separately from the equity of the owners of the parent. From 1 January 2010, losses applicable to the non-controlling interests in a subsidiary are allocated to the non-controlling interests even if that results in a deficit balance. Prior to 1 January 2010 losses applicable to the non-controlling interests (formerly known as minority interest) in excess of the non-controlling interest in the subsidiary’s equity were allocated against the equity of the Group, except to the extent that the minority had a binding obligation and was able to make an additional investment to cover the losses. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, any retained interest in the entity is remeasured to its fair value, with the change in carrying amount recognized in profit or loss.
Scope of consolidation The changes in the scope of consolidation with respect to the prior year are shown in note 35. The consolidated companies are listed on page 118. The closing date of the companies is 31 December.
Business combinations –– Business combinations from 1 January 2010 >>Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the consideration transferred, measured at acquisition date fair value and the amount of any non-controlling interest in the acquiree. For each business combination, the Group measures the non-controlling interest in the acquiree either at fair value or at the proportionate share of the acquiree’s identifiable net assets. The choice of measurement basis is made on a transaction-by-transaction basis. >>Acquisition-related costs are recognized in profit or loss as incurred. >>When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date. >>If the business combination is achieved in stages, the acquisition date fair value of the Group’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date through profit or loss. >>Any contingent consideration to be transferred by the Group will be recognized at fair value at the acquisition date and included as part of the consideration transferred in a business combination. If the contingent consideration is classified as equity, it is not remeasured and settlement is accounted for within equity. Otherwise, subsequent changes to the fair value of the contingent consideration are recognized in profit or loss.
–– Business combinations prior to 1 January 2010 In comparison to the above-mentioned requirements, the following differences applied: >>the cost of acquisition was measured at the aggregate of the fair values at the date of exchange of assets given, of liabilities incurred or assumed, and of equity instruments issued by the Group in exchange for control of the acquiree, plus any costs directly attributable to the business combination. >>the non-controlling interest (formerly known as minority interest) was initially measured at the minority’s proportion of the net fair value of the assets, liabilities and contingent liabilities recognized. >>the business combinations achieved in stages were accounted for as separate steps. Any additional acquired share of interest did not affect previously recognized goodwill.
72 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
Investments in associates An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an interest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee, but is not control or joint control over those policies. The results and assets and liabilities of associates are incorporated in these financial statements using the equity method of accounting. Under the equity method, investments in associates are carried in the consolidated balance sheet at cost as adjusted for post-acquisition changes in the Group’s share of the net assets of the associate, less any impairment in the value of individual investments. If an associate is over-indebted and the Group’s interest is reduced to zero, additional losses are provided for, only to the extent that the Group has a legal or constructive obligation. Any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities of the associate, recognized at the date of acquisition, is recognized as goodwill. The goodwill is included in the carrying amount of the investment and is assessed for impairment as part of the investment. Any excess of the Group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after reassessment, is recognized immediately in profit or loss. Where a Group entity transacts with an associate of the Group, profits and losses are eliminated to the extent of the Group’s interest in the relevant associate.
Assets classified as held for sale Assets and disposal groups are classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification. Assets (and disposal groups) classified as held for sale are measured at the lower of the assets’ previous carrying amount and fair value, less disposal costs.
Impairment of assets Assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment. Assets that are subject to amortization or depreciation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset’s carrying value exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).
Segment reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segment, has been identified as the Group Executive Committee.
Revenue recognition Revenue from the sales of goods and services is measured at the fair value of the consideration received or receivable, net of returns, trade discounts, rebates and other sales taxes or duty. The Group recognizes revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the Group and when specific criteria have been met for each of the Group’s activities as described below.
Bobst Group Financial statements 2010 Consolidated financial statements 73 Notes to the consolidated financial statements
Sales of goods – machines. Revenue from the sales of machines is recognized when the significant risks and rewards of ownership have been transferred to the buyer, recovery of the consideration is probable, the associated costs can be estimated reliably, there is no continuing management involvement with the machines, and the amount of revenue can be measured reliably.
Sales of goods – spare parts. Spare parts revenue is mainly recognized upon shipment.
Sales of services. Revenues from services rendered include various services, such as maintenance contracts, reactive services and upgrades. Sales of services are recognized as revenue in the accounting period in which the services are rendered, which means that they are allocated over the contractual period.
If a machine sale includes subsequent delivery of parts and/or service, the corresponding amount is deferred and recognized as revenue when the recognition criteria are met for the corresponding category.
The Group’s policy for recognition of revenue from operating leases is described in the section “The Group as lessor” below.
Interest income. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount.
Dividend income. Dividend income from investments outside of the Group is recognized when the shareholder’s right to receive payment has been established.
Leasing Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.
The Group as lessor. Bobst Group companies may act as direct lessor to the customers. In accordance with IAS 17, leases where the Group transfers substantially all risks and benefits of ownership of the leased machine are disclosed as finance lease receivables. Amounts due from lessees under finance leases are recorded as finance lease receivables at the amount of the Group’s net present value for expected lease payments. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the Group’s net investment outstanding in respect of the leases. Leases where the Group does not transfer substantially all risks and benefits of ownership of the asset are classified as operating leases. Rental income from operating leases is recognized on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognized on a straight-line basis over the lease term.
The Group as lessee. The Group does not act as lessee for its capital expenditures, except for minor items.
Foreign currencies The individual financial statements of each Group entity are presented in the currency of the primary economic environment in which the entity operates (its functional currency). For the purpose of the consolidated financial statements, the results and financial position of each
74 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
entity are expressed in Swiss Francs, which is the functional currency of Bobst Group SA and the presentation currency for the consolidated financial statements. In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency (foreign currencies) are recorded at the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, all items denominated in foreign currencies are translated at the rates prevailing on the balance sheet date. Exchange differences arising from the settlement of monetary items, and from the retranslation of monetary items, are included in profit or loss for the period.
In order to hedge its exposure to certain foreign exchange risks, the Group enters into forward contracts and options (see below for details of the Group’s accounting policies in respect of such derivative financial instruments). For the purpose of presenting consolidated financial statements, the assets and liabilities of the Group’s foreign currency operations (including comparatives) are translated into Swiss Francs using exchange rates prevailing on the balance sheet date. Income, expense and cash flow items (including comparatives) are translated at the average exchange rates for the period. Goodwill and fair value adjustments arising from the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the closing rate.
Borrowing costs Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective assets. All other borrowing costs are expensed in the period they occur. Borrowing costs consist of interest and other costs that the Group incurs in connection with the borrowing of funds.
The Group capitalizes borrowing costs for all eligible assets where construction started on or after 1 January 2009.
Pension plans and other employee benefits
Defined contribution post-employment benefits. The contributions to such plans are recorded as expenses in the period in which they are incurred.
Defined benefit post-employment benefits. The liabilities of the Group arising from defined benefit obligations are determined using the projected unit credit method. Any net pension asset is limited to the present value of future economic benefits available to the Group in the form of refunds from the plan or expected reductions in future contributions to the plan. Valuations are carried out on a regular basis by independent actuaries. Actuarial gains and losses arise mainly from changes in long-term assumptions (discount rate, salary increase…) and from differences between actuarial assumptions and what has actually occurred. They are recognized in the income statement over the expected average remaining working lives of the employees only to the extent that their net cumulative amount exceeds 10% of the greater of either the present value of the obligation or the fair value of plan assets at the end of the previous year. The actuarial cost charged to the income statement consists mainly of: – service cost, which corresponds to the acquisition of one additional year of rights; – interest cost, which is due to the increase in the net present value of the benefit obligation which arises because the benefits are one period closer to their payment dates; – expected return on plan assets; – past service cost and actuarial gains and losses to the extent that they are recognized.
Bobst Group Financial statements 2010 Consolidated financial statements 75 Notes to the consolidated financial statements
Other long-term employee benefits. The actuarial value of the related obligations is accrued in liabilities, and the actuarial gains and losses are directly posted to the income.
Share-based payment compensation The cost of equity-settled compensation is measured by reference to the market value of the shares at the date on which they are granted. This cost is included in the personnel expenses.
Taxation Income tax expense represents the sum of the tax currently payable, as well as deferred taxes.
Tax payables. The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years, and it further excludes items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates prevailing on the balance sheet date.
Deferred tax. Deferred tax is recognized on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences and deferred tax assets are recognized to the extent that it is probable that taxable profits will be available, against which deductible temporary differences can be utilized. Such assets and liabilities are not recognized if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. Deferred tax liabilities are recognized for taxable temporary differences arising from investments in subsidiaries and associates, as well as from interests in joint ventures, except where the Group is able to control the reversal of the temporary difference, and where it is probable that the temporary difference will not reverse in the foreseeable future. The carrying amount of deferred tax assets is reviewed on each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realized, based on tax rates that have been enacted or substantively enacted at the reporting date. Deferred tax is charged or credited to profit or loss, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities, and when they relate to income taxes levied by the same tax authority, within the same taxable entity, and when the Group intends to settle its current tax assets and liabilities on a net basis.
Intangible fixed assets
Patents. Patents are measured initially at purchase cost and are amortized on a straight-line basis over their estimated economic or legal life with a maximum of 20 years.
Computer Software. Acquired computer software licenses are capitalized on the basis of the costs incurred to acquire and put into service the specific software. These costs are amortized on a straight-line basis over their estimated useful life (3-7 years).
Goodwill. Goodwill arising from the acquisition of a subsidiary or a jointly controlled entity represents the excess of the cost of acquisition over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the subsidiary or jointly controlled
76 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
entity recognized at the date of acquisition. Goodwill is initially recognized as an asset at cost and is subsequently measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill is allocated to each of the Group’s cash-generating units expected to benefit from the synergies of the combination. Cash-generating units to which goodwill has been allocated are tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit, and then to the other assets of the unit, pro rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognized for goodwill is not reversed in a subsequent period. On disposal of a subsidiary or a jointly controlled entity, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.
Research & Development All research costs are charged directly to the income statement. Development costs are not recognized as intangible assets because criteria for recognition of IAS 38 are not met.
Tangible fixed assets Land is booked at purchase costs, and the other tangible fixed assets at purchase or manufacturing costs less depreciation. Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These are included in the income statement. Land is not depreciated. Depreciation on other tangible fixed assets is calculated using the straight-line method as follows:
Buildings (including investment properties) 10-30 years Techn. instal., industrial equipment 7-20 years Machines leased to customers According to their useful life IT equipment 4 years Other 5-7 years In progress Not depreciated
Inventories Raw materials are stated at the lower of either the cost or the net realizable value, using the weighted average method. Work in progress and finished products are stated at the lower of the production costs or the net realizable value. Production costs comprise direct materials and, where applicable, direct labor costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Net realizable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution. Valuation adjustments are made for slow-moving items and excess stock.
Financial instruments – Financial assets Financial assets are recognized on the Group’s balance sheet when the Group becomes a party to the contractual provisions of the instrument.
Initial recognition and measurement. Financial assets are initially recognized at fair value plus directly attributable transaction costs. At initial recognition, financial assets are designated into two categories, Financial assets at fair value through profit and loss and Loans and receivables. The Group’s financial assets include cash and cash equivalents, receivables, finance lease receivables, financial assets other and derivative financial instruments.
Bobst Group Financial statements 2010 Consolidated financial statements 77 Notes to the consolidated financial statements
Subsequent measurement. The subsequent measurement of financial assets depends on their classification: Financial assets at fair value through profit and loss. This category comprises financial assets held for trading, which comprise assets acquired principally for the purpose of being sold in a near future and derivatives entered into by the Group that are not designated as effective hedging instruments. Financial assets at fair value through profit and loss are carried in the balance sheet at fair value with changes in fair value recognized in the income statement. Loans and receivables. Loans and receivables are non derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables are subsequently measured at amortized cost using the effective interest rate method, less impairment. The Group assesses at each reporting date whether there is any objective evidence that an asset or group of assets is impaired. An asset or group of assets is deemed to be impaired if, and only if, there is objective evidence of impairment as a result of one or more events that has occurred after initial recognition of the asset (“loss event”) and that loss event has an impact on the estimated future cash flows of the asset or the group of assets that can be reliably estimated. Evidence of impairment may include indications that the debtors or a group of debtors is experiencing significant financial difficulties, default or delinquency in interest or principal payments, the probability that they will encounter bankruptcy and where observable data indicate that there is a measurable decrease in the estimated future cash flows. The amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized (such as an improvement in the debtor’s credit rating), the reversal of the previously recognized impairment loss is included in the consolidated profit and loss statement.
Derecognition. A financial asset is derecognized when: –– the contractual rights to receive cash flows expire; or –– the Group has transferred its rights to receive cash flows from the asset and either the Group has transferred substantially all the risks and rewards of the asset, or the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
Financial instruments – Financial liabilities and equity instruments Financial liabilities and equity instruments issued by the Group are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability and an equity instrument.
Equity An equity instrument is any contract that evidences a residual interest in the net assets of the Group.
Financial liabilities
Initial recognition and measurement. Financial liabilities are recognized initially at fair value plus directly attributable transaction costs. At initial recognition, financial liabilities are designated into the categories Financial liabilities at fair value through profit and loss and Other financial liabilities. The Group’s financial liabilities include Trade and other payables, Borrowings and Derivative financial instruments.
78 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
Subsequent measurement. The subsequent measurement of financial liabilities depends on their classification: Financial liabilities at fair value through profit and loss. This category comprises derivatives entered into by the Group that are not designated as effective hedging instruments. Financial liabilities at fair value through profit and loss are carried in the balance sheet at fair value with changes in fair value recognized in the income statement. Other financial liabilities. Interest-bearing loans and overdrafts are subsequently measured at amortized cost, using the effective interest rate method. Any difference between the proceeds (net of transaction costs) and the settlement or redemption of borrowings is recognized over the term of the borrowings.
Derecognition. A financial liability is derecognized when the obligation under the liability is discharged, cancelled or expires.
Cash and cash equivalents Cash and cash equivalents comprise cash on hand and demand deposits, and other short- term highly liquid investments that are easily and quickly convertible to a known amount of cash.
Derivative financial instruments and hedging activities The Group enters into derivative financial instruments to manage its exposure to interest rate and foreign exchange rate risk. The Group’s management principles impose cautious financial management of the service of its industrial activity. Therefore, the Group does not use derivative financial instruments for speculative purposes.
Accounting for derivative financial instruments and hedging activities. Derivative financial instruments are initially measured at fair value on the contract date, and are remeasured at fair value at subsequent reporting dates. The Group documents at the inception of the transaction the relationship between hedging instruments and hedged items. The method of recognizing the resulting gain or loss depends on the nature of the item being hedged. Certain derivatives are designated “fair value hedges” and serve to hedge the fair value of recognized assets (for instance amounts already invoiced to customers) or liabilities, or a firm commitment. Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the income statement, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk. Other derivatives are designated “cash flow hedges” and serve to hedge highly probable forecast transactions (for instance budgeted sales). The Group documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used are highly effective in offsetting changes of the hedged items. The effective portion of changes of derivatives that are designated and qualify as “cash flow hedges” are recognized in other comprehensive income (hedge accounting). The gain or loss relating to the ineffective portion is recognized immediately in the income statement (currently hedge accounting is only in use at the subsidiary Bobst Group North America). Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, or exercised, or no longer qualifies for hedge accounting. Any cumulative gain or loss existing in equity at that time remains in equity and is recognized when the forecast transaction is ultimately recognized to the income statement. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss is transferred to profit or loss of the period. Changes in the fair value of any derivative instruments that do not qualify for hedge accounting (“hedges”) are recognized immediately in the income statement. The Group has no hedges of net investments in foreign operations. The fair values of various derivative financial instruments used are disclosed in note 25.
Bobst Group Financial statements 2010 Consolidated financial statements 79 Notes to the consolidated financial statements
Movements on the hedging reserve in the statement of comprehensive income are shown on page 66.
Provisions Provisions are recognized when the Group has a present obligation as a result of a past event, and when it is probable that the Group will be required to settle that obligation. Provisions are evaluated based upon the best estimate of the expenditure required to settle the obligation at the balance sheet date, and are discounted to present value where the effect is material. Provisions are classified as warranties, litigations, restructuring and other. Warranties include provisions for technical risks in the context of product deliveries and services. The provision is based on historical warranty data and a weighting of all possible outcomes against their associated probabilities. Warranty expenses are expected before expiration of the granted warranty period. Litigations include provisions for current and probable legal proceedings related to events in the past. A number of subsidiaries are subject to various legal proceedings that arise from time to time, including product liability, commercial, employment and tax litigations, intellectual property disputes.
For restructuring provisions, constructive obligation to restructure arises only when a detailed formal plan exists which identifies at least the business or part of the business concerned, the principal sites affected, the location, function and approximate number of employees who will be compensated for terminating their services, the expenditures that will be undertaken and the timing of the implementation; and when the features of this plan have been communicated in a manner that raised a valid expectation in those affected by it that the restructuring plan will be carried out.
Note 3 Significant accounting judgements, estimates, financial risk and capital management
Significant accounting judgements In the process of applying the Group’s accounting policies, management has made the following judgement, apart from other estimations, which could have a significant effect on the amounts recognized in the financial statements.
Benefit of tax loss carry-forwards. Some entities of the Group have made losses generating available tax loss carry-forwards and tax credits for the future. When the Group is not able to determine with enough certainty the future profits of certain entities, unutilized tax carry- forwards are not capitalized (note 26).
Estimates The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below.
Impairment of Goodwill. The Group determines whether goodwill is impaired at least once a year. This requires an estimation of the value in use of the cash-generating units to which the goodwill is allocated. For the estimation of the value in use, the Group has to make an estimate of the expected future cash flows from the cash-generating unit and choose a suitable discount rate in order to calculate the present value of those cash flows. Significant assumptions and valuations are necessary to make these estimates. The factors such as volume, selling price, material and personnel costs, capital expenditures, outcome of R&D
80 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
activities as well as market conditions and other economic factors are based on assumptions that management regards as reasonable. Due to these factors, actual cash flows and values could vary from the forecasted future cash flows and related values derived using discounting techniques.
Evaluation of Patents. Purchased patents are initially capitalized at purchase cost and are amortized on a straight line basis over their estimated useful lives. Each year, these estimated useful lives are reviewed by the technical specialists of the Group.
Provisions. Provisions are recognized when the Group has a present obligation as a result of a past event, and when it is probable that the Group will be required to settle that obligation. Provisions are created for a variety of possible events (for details, see note 2). However, by definition, provisions contain a higher degree of estimates than other balance sheet items, since the estimated obligations can cause greater or lesser cash drain depending on how the situation materializes.
Employee benefits. In various countries there are pension and other retirement plans. Several statistical and other factors that attempt to anticipate future events are used in calculating the expense and liability related to the plans. These factors include assumptions about the discount rate, the expected return on plan assets and the expected rate of salary increase. The actuarial assumptions used (note 31) may differ from actual results due to changing market and economic conditions.
Financial risk management The Bobst Group way of managing financial matters aims to a strong decentralization, whether for cash management, short and long-term borrowing and foreign exchange risks. Decentralization avoids the inefficiency of miscommunication and enables a more rapid local reaction, with the result of more cost-efficient transactions. Moreover, it enables the use of natural hedge at the level of the Group companies. There is a strict regular reporting on such matters to the Group treasury. Finally, given the tight management of the balance sheet structures of the individual Group companies, Group treasury is systematically involved to bring the global expertise when negotiating credit lines and other borrowings, with the aim of ensuring conditions in line with the rating of the Group.
Foreign exchange risks. Transaction risks: all Group companies are instructed to hedge significant transaction risks with the appropriate derivatives when they arise, with the aim of guaranteeing margins achieved when selling products. Translation risks: are not hedged and the relative amounts end up in equity under translation reserve. The Group utilizes natural hedge in order to offset some of these risks.
Interest rate risks. The Group uses interest rate derivatives to manage its exposure to interest rate movements on its bank borrowings. The contracts are concluded by the Group companies being in such a situation evidencing need for such transactions. Group treasury is involved in the decision process.
Credit risks. Credit risks are linked with the non ability or unwillingness of such counterparties to a transaction to fulfill its obligations. Customers: determination of the payment conditions resulting in the trade receivables takes into consideration the country risk as well as solvency of the counterparty. Reserve of property clauses are also utilized until final payment. In relation with longer-term payment conditions agreed upon and depending on the negotiations with the customer, guarantees including, among others, export credit agencies and private insurers are used.
Bobst Group Financial statements 2010 Consolidated financial statements 81 Notes to the consolidated financial statements
When risk conditions allow it, it is also regular practice to discount without recourse amounts due by customers. There is no particular risk concentration on the customer receivables. Local and Group finance members monitor the payment conditions. Banks and counterparties: for other financial assets, the concern of credit risk imposes the use of good quality counterparties. Cash is deposited with a number of various well established banks to prevent any concentration risk.
Liquidity risks. Sufficient reserve of cash is maintained to meet at all times the Group’s liquidity requirements. Cash is managed in a decentralized way but under strict reporting and forecasting to the attention of Group treasury, to enable quick reaction whenever necessary.
Capital management The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders as well as to maintain an optimal capital structure to reduce cost of capital. In order to maintain or adjust the capital structure, the Group may adapt the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets. The Group monitors capital on the basis of the equity ratio. This ratio is calculated as equity divided by the total of the balance sheet. Equity is defined as shown in the consolidated balance sheet. The Group’s policy is to keep the equity ratio between 40% and 45%.
82 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
Bobst Group Financial statements 2010 Consolidated financial statements 83 Notes to the consolidated financial statements
In million CHF
Note 4 Sales
Business segment information is stated on note 14. 2010 2009
Distribution by business activity: Machines 916.6 711.0 Spare parts 294.9 277.1 Services 68.7 67.4 Total 1'280.2 1'055.5
Note 5 Other operating income 2010 2009
Gains on disposal of fixed assets 77.4 0.0 Capitalized production 1.8 0.3 Transfer of operating charges 4.1 7.0 Income from leased machines 0.2 0.2 Other 8.9 8.7 Total 92.4 16.2
The gains on disposal of fixed assets relates mainly to the sales of real estate properties located in Switzerland.
Note 6 Raw materials and services 2010 2009
Material costs 571.3 477.3 Rent, Maintenance, Energy 33.5 36.0 Marketing, Communication, Travel 53.1 50.8 External staff 16.9 4.4 Transport, Customs, Insurance 37.1 27.9 Administration and other costs 92.7 83.0 Total 804.6 679.4
Note 7 Personnel costs 2010 2009
Wages and salaries 372.1 422.6 Social expenses and other personnel expenses 85.9 91.2 Total 458.0 513.8
An important Group transformation program started in 2009 generated significant restructuring costs, of which 1.4 million relate to personnel costs in 2010 (2009: CHF 49.1 million).
84 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 8 Depreciation and amortization 2010 2009
Intangible assets 9.6 12.4 Tangible assets 23.5 25.5 Impairment loss 0.0 7.6 Total 33.1 45.5
Note 9 Other operating expenses 2010 2009
Taxes on capital and other taxes 9.3 7.2 Loss on disposal of subsidiaries (note 34) 3.8 0.0 Non recurrent charges 2.5 1.0 Total 15.6 8.2
The non recurrent charges for 2010 (CHF 2.5 million) relate exclusively to the write-off of fixed assets which were no longer used.
Note 10 Financial result 2010 2009
Interest expenses -24.3 -19.8 Interest income 5.6 4.6 Exchange rate differences 3.9 -2.0 Gains / losses on derivative financial instruments 12.4 2.7 Gains / losses on disposal of financial assets 0.1 0.1 Other financial income 3.5 2.7 Other financial expenses -2.8 -4.8 Total other financial expenses and income 22.7 3.3 Total -1.6 -16.5
Bobst Group Financial statements 2010 Consolidated financial statements 85 Notes to the consolidated financial statements
In million CHF
Note 11 Income tax 2010 2009
Current taxes expense 2.8 4.3 Deferred taxes expense/(income) 10.4 -36.7 Total 13.2 -32.4
The total above expense/(income) for each year can be reconciled as follows: Profit / loss before income tax (including results of associates) 62.5 -193.1 Results of associates -2.8 1.4 Profit / loss before income tax (excluding results of associates) 59.7 -191.7
Taxes at the weighted average income tax rate of 32.3% (2009: 24.9%). These percentages are based on rates prevailing in the different jurisdictions 19.3 -47.7 Tax effect of utilization of tax losses not previously recognized -6.6 0.0 Tax losses for which no deferred income tax asset was recognized during the year 1.0 12.8 Non periodic taxes 0.0 2.2 Other effects -0.5 0.3 Total 13.2 -32.4
The variance of +7.4% in the weighted average income tax rate is caused by a change in the profitability of the Group’s subsidiaries in the respective countries.
Note 12 Earnings per share 2010 2009
Net result (in million CHF) 49.3 -160.7 Average number of registered shares 16'518'478 16'518'478 Earnings per registered share (in CHF) 2.98 -9.73 Diluted earnings per registered share (in CHF) 2.98 -9.73
The average number of outstanding registered shares is calculated based on the number of shares issued, less the weighted average of own shares. Since there were no conversion rights and no option rights outstanding, earnings per registered share have not been diluted.
Note 13 Assets and liabilities classified as held for sale
The amount shown as of 31 December 2009 relates to the sale of a real estate property located in Switzerland, which was realized in the first half of 2010 with a profit of CHF 3.9 million (post-tax CHF 3 million). 2010 2009
The assets and liabilities classified as held for sale are the following: Tangible fixed assets 0.0 1.8 Total assets classified as held for sale 0.0 1.8 Total liabilities directly associated with assets classified as held for sale 0.0 0.0
86 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 14 Segment reporting
The Group Executive Committee is identified as chief operating decision-maker and reviews the Group’s internal reporting in order to assess performance and allocate resources. Internal reporting is based on the same accounting principles as the ones used to establish these financial statements and segment performance is assessed based on the operating result. However, Group financing (including finance costs and finance income) and income taxes are managed on a Group basis and are not allocated to operating segments.
As a result of the challenging economic environment in 2009, the Group has decided to accelerate its change and transformation. While continuing to serve its customers by industry (folding carton, corrugated board and flexible materials), the Group has reorganized its structure by technological processes within three Business Units (BU). The new organization became effective as of 1 January 2010. Consequently, the reportable segments of the Group are now as follows: – BU Sheet-fed combines machine sales of all product lines in the folding carton and corrugated board industries; – BU Web-fed covers machine sales activities linked to the flexible materials industry, including the Web-fed Solutions product line (previously Champlain in the folding carton); – BU Services expands Bobst Group's service offering by developing the sale of supplies and by supporting the customers in their operational activities; – the segment “Other” includes secondary activities which are not significant for the Group.
No operating segments have been aggregated to form the above reportable operating segments. Amounts reported for prior periods have been restated to conform to the requirements of IFRS 8. This restatement was established on the basis of best knowledge of the detailed new organization at the time of its preparation.
The inter-segment operations correspond to the contribution paid by the Business Unit Services to the other Business Units for the right to sell spare parts and services on their equipment. These contributions do not generate internal margin. 2010 2009
Revenue Sheet-fed third party sales 607.5 462.5 Sheet-fed inter-segment 18.2 13.9 Sheet-fed total revenue 625.7 476.4
Web-fed third party sales 304.1 247.1 Web-fed inter-segment 6.1 4.9 Web-fed total revenue 310.2 252.0
Services third party sales 363.7 341.9
Other third party sales 4.9 4.0
Eliminations inter-segment -24.3 -18.8
Total third party sales 1'280.2 1'055.5
Bobst Group Financial statements 2010 Consolidated financial statements 87 Notes to the consolidated financial statements
In million CHF
Note 14 (continued) Segment reporting
Sheet-fed Web-fed Services Other Total Total
2010 2009 2010 2009 2010 2009 2010 2009 2010 2009
Results Total segment operating result -0.1 -160.9 6.1 -43.0 52.6 31.0 2.7 -2.3 61.3 -175.2 Share of result of associates (note 19) 2.8 -1.4 2.8 -1.4 Financial result -1.6 -16.5 Result before income tax 62.5 -193.1 Segment operating result includes: Depreciation and amortization -20.6 -30.9 -5.1 -6.0 -7.3 -8.0 -0.1 -0.6 -33.1 -45.5 Restructuring costs (personnel and other) (note 7) -2.5 -33.8 -3.1 -9.4 -4.3 -14.6 0.0 0.0 -9.9 -57.8 Gains on disposal of fixed assets (note 5) 54.6 8.1 11.7 3.0 77.4
Sheet-fed Web-fed Services Other Total Total
2010 2009 2010 2009 2010 2009 2010 2009 2010 2009
Other disclosures Capital expenditure 39.7 18.9 8.1 3.2 8.9 3.9 0.1 0.1 56.8 26.1
Capital expenditure consists of tangible and intangible fixed assets.
Geographic information 2010 2009
Revenue from external sales Switzerland (domicile country) 24.7 1.9% 17.8 1.7% United States of America 227.8 17.8% 178.8 16.9% Germany 125.7 9.8% 121.0 11.5% Other countries 902.0 70.5% 737.9 69.9% Total 1'280.2 100.0% 1'055.5 100.0%
Non-current assets Switzerland (domicile country) 196.0 52.2% 190.5 47.1% Italy 46.6 12.4% 39.3 9.7% Germany 46.4 12.4% 55.4 13.7% Other countries 86.2 23.0% 119.3 29.5% Total 375.2 100.0% 404.5 100.0%
Revenues are allocated to countries on the basis of the client’s location.
Non-current assets consist of tangible and intangible fixed assets as well as goodwill.
88 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 15 Intangible fixed assets
Patents Software Other In progress Total
Gross value At the beginning of the year 2010 21.7 100.8 1.7 0.0 124.2 Additions 0.0 3.2 6.9 6.1 16.2 Disposals and decreases 0.0 -12.7 0.0 0.0 -12.7 Currency variances -1.0 -2.1 -0.1 0.0 -3.2 At year-end 2010 20.7 89.2 8.5 6.1 124.5
Accumulated amortization At the beginning of the year 2010 -17.3 -64.2 -0.8 0.0 -82.3 Additions -0.5 -8.9 -0.2 0.0 -9.6 Disposals and decreases 0.0 11.5 0.0 0.0 11.5 Currency variances 0.4 1.7 0.1 0.0 2.2 At year-end 2010 -17.4 -59.9 -0.9 0.0 -78.2 Net value at year-end 2010 3.3 29.3 7.6 6.1 46.3
In 2010, the Group sold its properties in Prilly (CH) but kept the right to occupy the buildings until the move to the new premises. This utilization right was measured at the fair value of the consideration received, i.e. the present value of the favorable credit terms agreed with purchasers, and amounts to CHF 6.9 million. It will be amortized over the period of use. There is no impairment charge or reversal included in the 2010 amortization charge.
Bobst Group Financial statements 2010 Consolidated financial statements 89 Notes to the consolidated financial statements
In million CHF
Note 15 (continued) Intangible fixed assets
Patents Software Other In progress Total
Gross value At the beginning of the year 2009 21.7 87.0 1.7 0.1 110.5 Additions 0.0 13.6 0.0 0.0 13.6 Disposals and decreases 0.0 -0.3 0.0 0.0 -0.3 Currency variances 0.0 0.4 0.0 0.0 0.4 Transfer 0.0 0.1 0.0 -0.1 0.0 At year-end 2009 21.7 100.8 1.7 0.0 124.2
Accumulated amortization At the beginning of the year 2009 -7.7 -53.8 -0.8 0.0 -62.3 Additions -9.6 -10.4 0.0 0.0 -20.0 Disposals and decreases 0.0 0.3 0.0 0.0 0.3 Currency variances 0.0 -0.3 0.0 0.0 -0.3 Transfer 0.0 0.0 0.0 0.0 0.0 At year-end 2009 -17.3 -64.2 -0.8 0.0 -82.3 Net value at year-end 2009 4.4 36.6 0.9 0.0 41.9
In 2009, an impairment loss of CHF 7.6 million had been recognized on patents which no longer had a recoverable value for the Group subsequent to its transformation. The impairment loss is included in the 2009 annual amortization charge of CHF 20.0 million. The impaired patents belonged to the segment Sheet-fed. There is no impairment reversal included in the amortization charge.
90 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 16 Goodwill 2010 2009
At the beginning of the year 80.6 78.3 Exchange rate variances -12.0 2.3 Total 68.6 80.6
Goodwill is allocated by Business Unit (BU) as follows: BU Sheet-fed 8.5 9.9 BU Web-fed 30.7 36.1 BU Services 29.4 34.6 Total 68.6 80.6
The Group tests goodwill annually for impairment, or more frequently if there are indications that goodwill might be impaired. Goodwill is allocated to the different business segments, and the recoverable amounts are determined by value-in-use calculations that are based on financial forecasts over three years approved by management. The three years forecasts are founded on the following key assumptions, which are based on past experience: the end-customer industries are recovering from the crisis, but Bobst Group markets are expected to remain challenging; the volume will need at least three years to recover the pre-crisis level; the margin decrease experienced in 2009 and 2010 should stop and margins should slowly increase over the next three years; personnel costs will evolve in relation with the activity, but overheads will remain stable. Cash flows for the next three years are extrapolated from these forecasts, and cash flows beyond this three years period are frozen to a nil increase. The discount rates used are pre-tax and reflect specific risks relating to the different business segments, i.e. BU Sheet-fed 8.3%, BU Web-fed 8.3%, BU Services 7.6%. The management believes that any reasonably possible change in the key assumptions on which recoverable amounts are based would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of each cash- generating unit. At the end of the year 2010, a decrease by 10% of the future cash flows or an increase of 1% of the discount rates would not necessitate any impairment charge of goodwill for any of the three business segments. Following the organizational change that occurred on 1 January 2010, goodwill has been reallocated accordingly. Comparative discount rates for the previous year are not available due to this change of organization.
Note 17 Research & Development
CHF 76.4 million were spent on Research & Development (CHF 73.0 million in 2009). These costs were not capitalized in 2010 and 2009. All three business segments have focused their efforts on the improvement of existing models, on the development of new products, as well as on the research for standardization of the components of manufactured products of the Group.
Bobst Group Financial statements 2010 Consolidated financial statements 91 Notes to the consolidated financial statements
In million CHF
Note 18 Tangible fixed assets
Land Techn. instal., Machines and Investment industrial leased to IT buildings property equipment customers equipment Other In progress Total
Gross value At the beginning of the year 2010 484.7 0.0 219.1 0.1 53.2 38.8 8.7 804.6 Additions 2.4 0.0 3.3 0.8 3.3 0.5 30.3 40.6 Disposals and decreases -113.4 0.0 -8.8 -0.1 -11.8 -2.1 -1.3 -137.5 Currency variances -19.8 0.0 -7.1 -0.1 -2.1 -2.8 -0.1 -32.0 Transfers -3.8 4.4 2.4 0.0 0.0 0.0 -3.0 0.0 At year-end 2010 350.1 4.4 208.9 0.7 42.6 34.4 34.6 675.7
Accumulated depreciation At the beginning of the year 2010 -269.7 0.0 -170.4 -0.1 -48.4 -34.0 0.0 -522.6 Additions -10.6 0.0 -7.9 -0.1 -3.0 -1.9 0.0 -23.5 Disposals and decreases 92.7 0.0 7.7 0.1 11.8 1.8 0.0 114.1 Currency variances 7.4 0.0 4.6 0.0 2.1 2.5 0.0 16.6 Transfers 1.2 -1.2 0.0 0.0 0.0 0.0 0.0 0.0 At year-end 2010 -179.0 -1.2 -166.0 -0.1 -37.5 -31.6 0.0 -415.4 Net value at year-end 2010 171.1 3.2 42.9 0.6 5.1 2.8 34.6 260.3
The Bobst Group owns a real estate property that is no longer used for its operations and is currently leased to a third party. At 31 December 2010, the fair value of this investment property amounts to CHF 4.4 million (nil in 2009). This fair value is based on a purchase option held by a third party, which has a high likelihood to be exercised.
The borrowing costs capitalized during the year ended 31 December 2010 amounts to CHF 0.6 million (2009: 0.0 million), with a capitalization rate of 5.2%.
92 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 18 (continued) Tangible fixed assets
Land Techn. instal., Machines and industrial leased to IT buildings equipment customers equipment Other In progress Total
Gross value At the beginning of the year 2009 485.7 219.4 0.1 52.8 39.3 3.4 800.7 Additions 0.4 4.0 0.0 1.5 0.8 5.8 12.5 Disposals and decreases -0.4 -8.0 0.0 -1.2 -2.0 0.0 -11.6 Currency variances 3.7 3.5 0.0 0.4 0.4 0.1 8.1 Reclassified from held for sale -5.1 0.0 0.0 0.0 0.0 0.0 -5.1 Transfers 0.4 0.2 0.0 -0.3 0.3 -0.6 0.0 At year-end 2009 484.7 219.1 0.1 53.2 38.8 8.7 804.6
Accumulated depreciation At the beginning of the year 2009 -261.5 -168.0 -0.1 -46.2 -32.7 0.0 -508.5 Additions -10.9 -8.7 0.0 -3.4 -2.5 0.0 -25.5 Disposals and decreases 0.4 7.9 0.0 1.2 1.7 0.0 11.2 Currency variances -1.0 -1.5 0.0 -0.3 -0.3 0.0 -3.1 Reclassified from held for sale 3.3 0.0 0.0 0.0 0.0 0.0 3.3 Transfers 0.0 -0.1 0.0 0.3 -0.2 0.0 0.0 At year-end 2009 -269.7 -170.4 -0.1 -48.4 -34.0 0.0 -522.6 Net value at year-end 2009 215.0 48.7 0.0 4.8 4.8 8.7 282.0
Tangible fixed assets are insured at the replacement value of CHF 736 million (2009: CHF 952 million). There is no impairment charge (2009: CHF 0.0 million) or reversal included in the annual depreciation charge of CHF 23.5 million (2009: CHF 25.5 million). There are no significant tangible fixed assets financed with leases.
Bobst Group Financial statements 2010 Consolidated financial statements 93 Notes to the consolidated financial statements
In million CHF
Note 19 Investments in associates 2010 2009
Unlisted associates (interest held in %) Duo-Technik GmbH 40.00% 40.00% BHS Group 30.00% 30.00%
Changes over period are the following: Beginning of the year 63.6 65.2 Share of result of associates 2.8 -1.4 Dividends received -0.1 -0.2 Exchange differences -10.5 0.0 Total 55.8 63.6
Goodwill related to investments in associates is included in theses figures.
Summarized financial information regarding the Group’s associates is set out below: Total assets 288.7 342.7 Total liabilities -104.8 -132.8 Net assets 183.9 209.9
Group’s share of associates’ net assets 55.8 63.6
Total sales of associates 269.1 272.0
Total net result of the period 9.1 -4.7
Group’s share of associates’ net result of the period 2.8 -1.4
There are no unrecognized losses on associates.
The final BHS Group 2008 figures were not available when the Group produced the 2008 consolidated financial statements and the BHS Group 2008 figures were therefore based on estimates. Consequently, as of 31 December 2009, the share of results of associates includes a profit of CHF 0.1 million as adjustment of the BHS Group figures for the year 2008.
94 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 20 Receivables and prepaid expenses
2010 2009 Current Non-current Total Current Non-current Total
Trade receivables from third parties 215.8 1.9 217.7 234.3 4.8 239.1 Receivables from the sale of fixed assets 0.0 78.7 78.7 0.0 0.0 0.0 Various receivables from third parties 54.8 13.9 68.7 49.4 6.3 55.7 Prepaid expenses 6.8 1.0 7.8 6.7 1.1 7.8 Total 277.4 95.5 372.9 290.4 12.2 302.6
Receivables from the sale of fixed assets relate to the sale of properties in Switzerland. This amount has been discounted at a rate of 3.75%.
Note 21 Finance lease receivables
Finance lease receivables include discounted receivables with recourse amounting to CHF 1.9 million (2009: CHF 3.7 million). The Group remains responsible until the transferred receivables are paid in full. The corresponding liability appears under trade and other payables. The discounted receivables with recourse are not included in the following analysis. 2010 2009
Maturity within one year 15.7 21.6 Maturity after one year 19.1 23.9 Total 34.8 45.5 Less: unearned finance income -4.1 -4.9 Total 30.7 40.6
Analyzed as: Recoverable within one year 14.2 19.5 Recoverable after one year 16.5 21.1 Total 30.7 40.6
The Group enters into finance leasing arrangements with clients for the machines sold. The weighted average term of finance lease contracts is 2.8 years for 2010 (2009: 2.6 years). The average interest rate of all the lease contracts is approximately 6.6% (2009: 6.4%) per annum.
Bobst Group Financial statements 2010 Consolidated financial statements 95 Notes to the consolidated financial statements
In million CHF
Note 22 Credit risk related to client receivables 2010 2009
Trade receivables 238.1 266.9 Finance lease receivables 39.7 51.4 Total gross value 277.8 318.3 Less provision for impairment -27.5 -35.0 Total for the analysis 250.3 283.3
The aging of the amounts past due but not impaired is as follows: < 2 months 34.6 34.5 2-6 months 9.8 7.4 > 6 months 6.6 8.4
+ not yet due 199.3 233.0
Total 250.3 283.3
2010 2009
Movements in the provision for impairment were as follows: At the beginning of the year -35.0 -32.2 Changes in the scope of consolidation 1.7 0.0 Additions -4.0 -11.4 Utilizations 5.9 7.6 Releases 0.5 0.9 Reclassifications -0.1 0.0 Currency variances 3.5 0.1 At year-end -27.5 -35.0
The maximum exposure to credit risk at the reporting date is the carrying amount of client receivables mentioned above.
96 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 23 Derivative financial instruments 2010 2009 Assets Liabilities Assets Liabilities
Forward foreign exchange contracts 19.1 1.4 6.7 3.1 Total 19.1 1.4 6.7 3.1
Less non current portion: Forward foreign exchange contracts 0.1 0.0 0.9 0.0 Total 0.1 0.0 0.9 0.0
Current portion 19.0 1.4 5.8 3.1
Currency derivatives (forwards and options) The Group utilizes currency derivatives to hedge significant future transactions and cash flows. The Group is party to a variety of foreign currency forward contracts and options in the management of its exchange exposures. The instruments purchased are primarily denominated in the currencies of the Group’s principal markets. The options and forwards are in principle designated to address exchange rate exposures for the following 12 months and are renewed on a revolving basis as required.
On the balance sheet date, the total notional amount of outstanding forward foreign exchange contracts to which the Group is committed amounts to CHF 358.7 million (2009: CHF 306.6 million).
The fair value of currency derivatives that are designated and effective as cash flow hedges (hedge accounting) amounting to CHF 2.0 million (2009: CHF 0.4 million) is recorded through equity.
The Group does not currently designate its foreign currency denominated debt as a hedging instrument for the purpose of hedging the translation of its foreign operations.
Bobst Group Financial statements 2010 Consolidated financial statements 97 Notes to the consolidated financial statements
In million CHF
Note 24 Borrowings
2010 2009 Current Non-current Total Current Non-current Total
Bank borrowings 21.9 14.3 36.2 124.4 11.3 135.7 Debenture bonds 92.2 347.3 439.5 0.0 459.6 459.6 Other borrowings 0.4 1.0 1.4 2.1 2.0 4.1 Total 114.5 362.6 477.1 126.5 472.9 599.4
Thereof due in < 1 year 114.5 0.0 114.5 126.5 0.0 126.5 Thereof due in 1-5 years 0.0 362.6 362.6 0.0 218.8 218.8 Thereof due in > 5 years 0.0 0.0 0.0 0.0 254.1 254.1 Total 114.5 362.6 477.1 126.5 472.9 599.4
Currency composition of borrowings: CHF 94.2% 84.4% EUR 2.0% 8.6% USD 0.1% 1.7% GBP 0.1% 3.5% Other 3.6% 1.8% Total 100.0% 100.0%
The effective interest rates at the balance sheet date (current and non-current) were as follows: Bank and other borrowings 4.9% 1.8% Debenture bonds 4.4% 4.4%
Borrowings facilities: Borrowings at floating rate 9.1 52.7 Borrowings at fixed rate 468.0 546.7 Total 477.1 599.4
Borrowings arranged at fixed rates expose the Group to fair value interest risk, and borrowings arranged at floating rates expose the Group to cash flow interest rate risk.
The main borrowings are: – a debenture bond issued by Bobst Group SA of CHF 120 million, maturity in July 2011, fixed interest rate of 3.25%, no clause of anticipated repayment, quoted at SIX Swiss Exchange, of which CHF 28 million bought back in the market (2009: CHF 7 million); – a debenture bond issued by Bobst Group SA of CHF 100 million, maturing in July 2013, fixed interest rate of 4.125%, no clause of anticipated repayment, quoted at SIX Swiss Exchange; – a debenture bond issued on 22 June 2009 by Bobst Group SA of CHF 250 million, maturing in June 2015, fixed interest rate of 5%, no clause of anticipated repayment, quoted at SIX Swiss Exchange; – various utilizations under bank facilities, like current account overdrafts and fixed term loans, most of them non-secured. The assets pledged for this purpose are tangible assets for CHF 12.3 million in 2010 (2009: CHF 18.5 million).
98 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 25 Analysis and other information related to financial instruments and capital management
The Group classifies its financial assets and liabilities into the following categories as per IFRS 7:
Financial assets At fair value 2010 2009 through Loans Carrying Carrying profit and amount Fair value amount Fair value or loss receivables
Financial assets other 2.7 2.7 1.9 1.9 x Trade receivables 217.7 217.7 239.1 239.1 x Finance lease receivables 32.6 39.1 44.3 50.9 x Other receivables 137.7 137.7 47.2 47.2 x Derivative financial instruments 19.1 19.1 6.7 6.7 x Cash and cash equivalents 313.8 313.8 424.6 424.6 x Total 723.6 730.1 763.8 770.4
Financial liabilities At fair value 2010 2009 through Other Carrying Carrying profit financial amount Fair value amount Fair value or loss liabilities
Borrowings-Bank and other current 22.3 22.3 126.5 126.5 x Borrowings-Bank and other non-current 15.3 15.3 13.3 13.3 x Borrowings-Debenture bonds 439.5 492.0 459.6 472.6 x Trade and other payables 275.5 275.5 274.8 274.8 x Derivative financial instruments 1.4 1.4 3.1 3.1 x Total 754.0 806.5 877.3 890.3
The fair value of the financial assets and liabilities are included in the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The Group uses the following methods and assumptions in estimating the fair value of assets and liabilities measured at fair value on a recurring basis: – the carrying amount of financial assets other, trade receivables, other receivables, cash and cash equivalents, trade and other payables approximate their fair value; – the fair value of finance lease receivables and borrowings are estimated by discounting their future cash flows at market rates; – the fair value of derivative financial instruments are determined using price quotes for similar instruments, appropriately adjusted. The fair value obtained represents a level 2 input unless significant unobservable inputs are used.
Bobst Group Financial statements 2010 Consolidated financial statements 99 Notes to the consolidated financial statements
In million CHF
Note 25 (continued) Analysis and other information related to financial instruments and capital management
Fair value hierarchy The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique: Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data.
All assets and liabilities measured at fair value as at 31 December 2010 and 31 December 2009 represent a Level 2 fair value measurement.
During the reporting period ending 31 December 2010 and 31 December 2009, there were no transfers between Level 1 and Level 2 fair value measurements, and no transfers into and out of Level 3 fair value measurements.
Liquidity risk The table below summarizes the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments. Less Between Less Between than 1 and Over than 1 and Over 2010 1 year 5 years 5 years 2009 1 year 5 years 5 years
Borrowings 548.4 124.9 423.5 0.0 692.1 136.8 286.3 269.0 Trade and other payables 275.5 270.6 4.9 0.0 274.8 262.6 12.2 0.0 Derivative financial instruments 1.4 1.4 0.0 0.0 3.1 3.1 0.0 0.0 Total 825.3 396.9 428.4 0.0 970.0 402.5 298.5 269.0
The carrying amounts of the financial assets and liabilities are denominated in the following currencies:
CHF EUR USD GBP Other Eliminations Total
Financial assets 2010 266.1 435.1 93.1 32.3 80.0 -183.0 723.6 Financial assets 2009 305.0 468.0 108.2 24.6 87.3 -229.3 763.8
Financial liabilities 2010 703.7 351.8 51.3 37.1 53.2 -443.1 754.0 Financial liabilities 2009 696.7 404.9 58.1 69.0 66.9 -418.3 877.3
100 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 25 (continued) Analysis and other information related to financial instruments and capital management
Sensitivity analysis for currency risk: The following table details the Group’s sensitivity to a: – 10% decrease/increase in the CHF/USD (2009: 10%); – 10% decrease/increase in the CHF/EUR (2009: 10%); – 10% decrease/increase in the CHF/GBP (2009: 10%). 2010 2009 Profit Profit and Loss Equity and Loss Equity
CHF / USD +/- 2.8 1.8 1.2 0.5 CHF / EUR +/- 7.4 – 10.4 – CHF / GBP +/- 1.5 – 1.0 –
Sensitivity analysis for interest rate risk: If the market interest rates on cash and borrowings at floating rate had been 100 basis points higher at year-end, the net interest effect would have been CHF 3.1 million (2009: CHF 3.7 million) higher.
Capital management: No changes were made in the objectives and policies during the years ended 31 December 2010 and 31 December 2009.
2010 2009
Total equity 577.7 577.8 Total balance sheet 1'643.4 1'752.7 Equity ratio 35.2% 33.0%
Bobst Group Financial statements 2010 Consolidated financial statements 101 Notes to the consolidated financial statements
In million CHF
Note 26 Deferred taxes 2010 2009 Assets Liabilities Assets Liabilities
Fixed assets 1.0 40.4 0.3 44.2 Inventories 8.0 24.7 8.6 28.8 Receivables 4.8 0.8 6.5 3.6 Employee benefits 4.9 10.9 8.6 8.2 Provisions 4.9 19.7 5.4 21.0 Other 2.5 5.3 0.7 1.6 Loss carry-forwards 14.0 0.0 22.7 0.0 Gross deferred taxes 40.1 101.8 52.8 107.4 Offset of assets and liabilities -6.9 -6.9 -16.0 -16.0 Net deferred taxes 33.2 94.9 36.8 91.4
Certain deferred tax assets and liabilities have been offset in accordance with the IFRS.
On the balance sheet date, the Group has unused tax losses of CHF 107.2 million (2009: CHF 179.1 million) available to offset against future profits. Included in these unrecognized tax losses are losses of CHF 9.4 million (2009: CHF 20.4 million) that will expire within a limit of time (CHF 7.8 million expiring within two to five years and CHF 1.6 million within more than five years), whereas other may be carried forward indefinitely. The impact of losses on income tax is mentioned in note 11.
No material additional tax liabilities due to dividend payments from subsidiaries and associates are expected.
There are no income tax consequences related to the payment of dividends by Bobst Group SA to its shareholders.
The increase of CHF 7.1 million (2009: decrease of CHF -36.5 million) in net deferred tax liabilities can be explained – by CHF 2.8 million (2009: CHF -36.7 million) recognized in the profit and loss statement; – by CHF 0.8 million (2009: CHF 0.2 million) recognized directly in other comprehensive income; – by CHF 3.5 million (2009: CHF 0.0 million) of exchange variations. There is no impact in 2010 and 2009 due to the change in scope of consolidation.
Note 27 Inventories 2010 2009
Raw materials 170.0 169.3 Work in progress 89.1 95.5 Finished products* 96.3 138.5 Total 355.4 403.3
* Including CHF 14.3 million (2009: CHF 16.5 million) for demo machines.
The carrying amount of inventories carried at the realizable value (less costs to sell) is CHF 70.4 million (2009: CHF 78.9 million).
The amount for write-down recognized as expense during the year is CHF 15.0 million (2009: CHF 7.7 million).
102 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 28 Share capital
2010 2009 2008 Number of Number of Number of registered registered registered shares, par shares, par shares, par value CHF 1.– value CHF 1.– value CHF 1.–
Issued shares Balance at 1 January 17'810'002 17'810'002 19'788'891 Increase – – – Reduction – – -1'978'889 Balance at 31 December 17'810'002 17'810'002 17'810'002
Shareholders JBF Finance SA 8'369'791 47.00% 8'049'899 45.20% 7'933'374 44.54% Nortrust Nominees Ltd. 2'034'412 11.42% 2'131'924 11.97% 1'945'565 10.92% Public Shareholders 6'114'275 34.33% 6'336'655 35.58% 6'639'539 37.28% Total shares outstanding 16'518'478 16'518'478 16'518'478 Treasury shares 1'291'524 7.25% 1'291'524 7.25% 1'291'524 7.25% Total shares issued 17'810'002 100.00% 17'810'002 100.00% 17'810'002 100.00%
Treasury shares in million CHF Book value 1.4 1.4 1.4 Market value 55.5 48.4 41.0
On 25 June 2008, Bobst Group SA finalized an operation of repurchase of its own equity instruments through the allocation of put options to the shareholders. During the exercise period, the company repurchased 1'802'552 of its own equity instruments for a total price of CHF 246.9 million. In compliance with the resolution approved by the Annual General Meeting of Shareholders on 7 May 2008, the 1'802'552 shares acquired upon exercise of the put options, together with 176'337 treasury shares, were cancelled on 24 July 2008 after expiration of the statutory notice period to creditors. After these operations, the share capital is reduced from CHF 19'788'891 to CHF 17'810'002 (17'810'002 registered shares of CHF 1.–).
Note 29 Dividends
At the Annual General Meetings of Shareholders held on 28 April 2010 and on 6 May 2009, the shareholders renounced the distribution of any dividend.
For the period under review, no dividend will be proposed by the Board of Directors. This proposal is subject to approval by the shareholders at the Annual General Meeting of Shareholders on 4 May 2011.
Bobst Group Financial statements 2010 Consolidated financial statements 103 Notes to the consolidated financial statements
In million CHF
Note 30 Provisions
Warranties Litigations Restructuring Other 2010 2009
At the beginning of the year 27.5 5.4 8.3 13.4 54.6 49.3 Changes in the scope of consolidation -1.7 0.0 0.0 0.0 -1.7 0.0 Additions 24.0 2.4 0.0 1.2 27.6 31.2 Utilizations -20.2 -1.2 -5.3 -3.6 -30.3 -25.7 Releases -0.6 -0.2 -1.7 -0.4 -2.9 -0.6 Reclassifications 0.0 0.0 0.0 -1.7 -1.7 0.0 Currency translation adjustment -3.0 -0.7 -0.7 -0.9 -5.3 0.4 At year-end 26.0 5.7 0.6 8.0 40.3 54.6
Of which non-current 0.1 1.5 0.0 2.2 3.8 6.8 Of which current 25.9 4.2 0.6 5.8 36.5 47.8 At year-end 26.0 5.7 0.6 8.0 40.3 54.6
By the nature of the related risks, the timing of cash outflows related to litigation and other is difficult to estimate.
104 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 31 Pension plans and other employee benefits
The Group has, apart from the legally required social security schemes, several independent pension and other post employment benefit plans, as well as other long-term employee benefits. The defined benefit plans are either externally funded, with the assets of the schemes held separately from those of the Group in independently administrated funds, or unfunded. For the funded plans, the deficit or excess of the fair value of plan assets over the present value of the defined benefit obligation is recognized as a liability or an asset in the balance sheet, taking into account any unrecognized actuarial gains and losses and past service cost. For the unfunded plans, the related liabilities are carried on the balance sheet. Other long-term employee benefits represent amounts due to employees under deferred compensation arrangements, such as long-service awards, jubilee premiums and end of service indemnities depending upon certain seniority criteria. The related obligation is accrued in liabilities.
The following is a summary of the status of the main post-employment and other long-term employee benefit plans as of 31 December 2010 and 2009: 2010 2009
Benefit obligation at the beginning of the year -1'037.2 -1'030.1 Service cost -20.8 -20.3 Interest cost -34.1 -32.2 Employee contributions -11.5 -11.9 Benefit payments 66.1 45.7 Plan amendments -2.2 3.9 Curtailments 0.0 10.4 Termination benefits 0.0 -8.2 Actuarial gains / losses -17.2 7.8 Foreign currency translation 10.1 -2.3 Benefit obligation at year-end -1'046.8 -1'037.2 of which unfunded -47.5 -48.9
Fair value of plan assets at the beginning of the year 1'003.3 919.1 Expected return on plan assets 44.4 41.0 Actuarial gains / losses -13.2 50.9 Employee contributions 11.9 12.2 Employer contributions 22.9 16.7 Benefit payments -58.9 -39.1 Foreign currency translation -5.7 2.5 Fair value of plan assets at year-end 1'004.7 1'003.3
Bobst Group Financial statements 2010 Consolidated financial statements 105 Notes to the consolidated financial statements
In million CHF
Note 31 (continued) Pension plans and other employee benefits 2010 2009
Funded status: (deficit)/surplus -42.1 -33.9 Unrecognized actuarial (gains)/losses 63.6 36.5 Unrecognized past service cost 0.8 -0.4 Defined benefits net assets/(liabilities) in the balance sheet 22.3 2.2 Liabilities from defined contribution plans -0.6 -0.6 Net assets/(liabilities) in the balance sheet 21.7 1.6
Reflected in the balance sheet as follows: Employee benefits assets 66.2 50.4 Pension plans and other employee benefits liabilities -44.5 -48.8 Net assets/(liabilities) in the balance sheet 21.7 1.6
The movement in the net defined benefits liabilities is as follows: Net assets/(liabilities) in the balance sheet at the beginning of the year 2.2 -15.3 Net periodic benefit cost -13.7 -6.3 Employer contributions 23.3 17.0 Benefit payments 7.2 6.6 Foreign currency translation 3.3 0.2 Net assets/(liabilities) in the balance sheet at year-end 22.3 2.2
The net periodic benefit cost recorded in the income statement consists of the following components: Service cost 20.8 20.3 Interest cost 34.1 32.2 Expected return on plan assets -44.4 -41.0 Recognized actuarial (gains)/losses 2.2 1.2 Recognized past service cost 1.0 -4.0 Curtailments 0.0 -10.6 Termination benefits 0.0 8.2 Total defined benefit expenses 13.7 6.3
These expenses are included in personnel costs (note 7).
The actuarial assumptions used to calculate the benefit obligations vary according to the economic conditions of the country in which the plan is located. The main assumptions are as follows: 2010 2009
Discount rate 2.90% 3.40% Expected return on plan assets 4.00% 4.50% Expected rate of salary increase 2.00% 2.00% Medical cost trend rate 8.80% 9.10%
106 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 31 (continued) Pension plans and other employee benefits 2010 2009
The effects of a 1% movement in the assumed medical cost trend rate were as follows: Effect on total service cost and interest cost +0.2 / -0.2 +0.2 / -0.2 Effect on the defined benefit obligation +2.8 / -2.3 +2.3 / -1.9
The weighted average asset allocation of funded defined benefit plans at the year end is as follows: Equity securities 30.90% 29.10% Debt securities 37.10% 37.70% Real estate 25.10% 24.40% Cash and other investments 6.90% 8.80%
The plans have no investment in Bobst Group’s own financial instruments or property used by entities of the Group.
The actual return on plan assets amounts to CHF 31.2 million for the year 2010 (2009: CHF 91.9 million).
Expected contributions to defined benefit plans for the year ending 31 December 2011 are estimated at CHF 21.0 million (employer contributions for funded plans or benefits payments for unfunded plans).
The main amounts of the defined benefit plans for the current and previous periods are as follows:
2010 2009 2008 2007 2006
Defined benefit obligation at the year end -1'046.8 -1'037.2 -1'030.1 -1'029.3 -1'098.9 Plan assets at the year end 1'004.7 1'003.3 919.1 1'077.7 1'077.9 Funded status: (deficit)/surplus -42.1 -33.9 -111.0 48.4 -21.0
Experience adjustments on plan obligations: gains/(losses) 21.4 34.7 -8.9 13.9 30.3 Experience adjustments on plan assets: gains/(losses) -13.2 50.9 -178.7 -33.6 105.8
Note 32 Share-based payment compensation
A predefined portion of the bonus of key executives is share-settled. All the rights attached to the shares are definitely transferred at the grant date (no vesting conditions), except the sale which is blocked for a period of three years. The number of shares granted depends on the share market price at the grant date.
For the performance period that ended 31 December 2010, 4'226 shares have been granted (2009: 4'080).
The expense recorded in 2010 in the personnel costs amounts to CHF 0.2 million (2009: CHF 0.2 million).
Bobst Group Financial statements 2010 Consolidated financial statements 107 Notes to the consolidated financial statements
In million CHF
Note 33 Business combination
No business combination occurred during 2010 and 2009.
Note 34 Disposal of subsidiaries
On 1 October 2010, Bobst Group disposed of Atlas Converting Equipment Ltd in Bedford (UK), with its brands Atlas and Titan. The brand products Atlas and Titan were not commonly used by the traditional Bobst Group customers, resulting in a low synergy level.
The loss on disposal is included in other operating expenses (note 9).
No disposal in 2009. 2010 2009
The net assets, at the date of the disposal, were the following: Tangible fixed assets 0.1 Inventories 16.0 Receivables 11.3 Other assets 0.3 Cash and cash equivalents 3.8
Borrowings -8.6 Provisions -1.7 Trade payables -17.2 Other liabilities -0.2 Net assets disposed of 3.8 0.0 Loss on disposal (note 9) -3.8 Cash received 0.0 0.0
Net cash outflow arising on disposal: Cash received 0.0 Cash and cash equivalents disposed -3.8 Net cash disposed -3.8 0.0
108 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 35 Changes in the scope of consolidation
Company Transaction Control % Business unit Country Date
2010 Bobst Canada Inc., Pointe Claire Merger (a) 100% Sheet-fed/ CA 31.12.2010 Web-fed/ Services Atlas Converting Equipment Ltd, Kempston, Bedford Disposal 100% Web-fed/ GB 01.10.2010 Services Fischer & Krecke Inc., Fairfield Merger (a) 100% Web-fed/ US 30.03.2010 Services
(a) merger with Bobst Group North America, Inc., Roseland.
2009 FAG SA, Avenches Merger (a) 100% Sheet-fed/ CH 30.04.2009 Other Converting FrabeLux Sàrl, Chatou (Paris) Merger (b) 100% Web-fed/ FR 01.01.2009 Services
(a) merger with Bobst SA, Prilly. (b) merger with Bobst SA, Antony (branch).
Bobst Group Financial statements 2010 Consolidated financial statements 109 Notes to the consolidated financial statements
In million CHF
Note 36 Related parties
Investments in associates BHS Group, D-Weiherhammer. Duo-Technik GmbH, D-Lauterbach.
Main shareholder JBF Finance SA, CH-Buchillon.
Key management personnel Board members. Thierry de Kalbermatten as Vice Chairman of our Board and Vice Chairman of the Board of JBF Finance SA. Jean-Pascal Bobst as Chief Executive Officer of our Group Executive Committee and member of the Board of JBF Finance SA. Alain Guttmann as member of our Board and member of the Board of JBF Finance SA. Group Executive Committee members.
Bobst employee benefit plans
Entities controlled by members of key BLR & Partners AG, CH-Thalwil. management personnel CapDconsulting Guttmann, CH-Lussy-sur-Morges.
Transactions with the related parties over 2010 and 2009: 2010 2009
Investments in associates Sales 0.2 0.1 Purchases 2.8 1.6 Receivables and prepaid expenses 0.1 0.0 Trade and other payables 0.4 0.1 Rendering or receiving of services / transfer of R&D 0.1 0.1 Loans to them 0.0 0.1
There is one current guarantee for EUR 1.7 million (2009: EUR 1.7 million) released in April 2002 by Bobst Group SA in favor of a bank to guarantee a loan to a related party. Sales were made at usual list prices, discounted, to reflect the quantity of goods in question and the relationships between parties at market prices. 2010 2009
Key management personnel compensation Short-term benefits 6.0 6.2 Post-employment benefits 1.4 0.3 Share-based compensation 0.2 0.2
Bobst employee benefit institutions Open payables due to them at year-end 4.1 3.4
Entities controlled by members of key management personnel Honorarium billed to Bobst Group SA 0.4 0.2
There is no engagement with related parties which is not yet booked.
110 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 37 Subsequent events
On 18 January 2011, the Group announced the acquisition of 65% of Gordon Ltd. The Bobst and Gordon product ranges have a high degree of complementarity, and the two companies will each continue to develop technologically advanced products and services that answer the business needs of their respective customers. For the acquisition, CHF 31.5 million was paid in cash. The estimated 2010 sales of this business amount to CHF 47 million with an estimated operating result of CHF 7 million.
The consolidated financial statements were approved for publication by the Board of Directors on 18 March 2011. They are also subject to approval by the Annual General Meeting of Shareholders. No events have occurred up to 18 March 2011, which would necessitate additional adjustments to the book values of the Group’s assets or liabilities, or which require disclosure.
Note 38 Contingent liabilities 2010 2009
Guarantee obligations in favor of third parties 2.6 3.9
Contingent liabilities are mentioned for the full nominal amount.
Note 39 Capital commitments
As at 31 December 2010, the Group has capital commitments of CHF 43 million relating to the construction project in Mex, Switzerland and CHF 10 million for the optimization of the production equipment (2009: 0).
Note 40 Exchange rates Balance sheet Profit & loss statement
2010 2009 2010 2009
Main exchange rates Euroland 1 EUR 1.25 1.49 1.38 1.51 USA 1 USD 0.94 1.03 1.04 1.08 United Kingdom 1 GBP 1.45 1.66 1.61 1.68
Bobst Group Financial statements 2010 Consolidated financial statements 111 Notes to the consolidated financial statements
In million CHF
Note 41 Board and Executive compensation disclosures as required by Swiss law
General principles Bobst Group wishes to be a reference employer, capable of attracting, keeping and motivating people with the best professional qualities.
The compensation policy is essentially based on: – a market conforming compensation, as well as – maintaining a performance culture, this in accordance with local practice in the country employing the person.
Responsibility and procedure for the determination of the remuneration The Compensation and Nomination Committee makes proposals for the individual remuneration of the members of the Board and approves, upon proposal of the Chairman of the Board, the total compensation of the Chief Executive Officer and informs the Board of such total compensation.
The Compensation and Nomination Committee also approves, upon proposal of the Chief Executive Officer, the total compensation of each ordinary member of the Group Executive Committee and submits to the Board of Directors the global amount of the compensation of all the ordinary members of the Group Executive Committee for approval. For all other employees, the review of the compensation is always done with the dual approval principle. The compensations of the entire staff of the Group are examined periodically, every two to three years, on the basis of available data and of analyses supplied by independent providers country by country and for comparable companies and industries.
Compensation system
Board of Directors The members of the Board of Directors are all non executive and receive a fixed remuneration in cash. Travel and other expenses in relation with their mandate are reimbursed.
Group Executive Committee The remuneration of the members of the Group Executive Committee is composed of a fixed and a variable portion. The system is based on the table thereafter:
112 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 41 (continued) Board and Executive compensation disclosures as required by Swiss law
Compensation system of the members of the Group Executive Committee
In % of budgeted total remuneration
Base salary Cash 50 – 60 +
Variable remuneration 90% cash, 10% vested shares of Bobst Group SA (for 3 years) 40 – 50
The variable portion is based on the parameters indicated in the table below: In % of budgeted variable remuneration
Group operating result (a) 25 Group ROCE (a) 25 Business Unit operating result (a) 0 – 20 Group Supply, Production and Logistics efficiency (a) 0 – 20 Personal objectives (b) 30 – 50 (a) Compared with the budgeted figures. (b) Represents five to ten quantitative and qualitative personal objectives fixed each year.
A gate at 70% of objectives/budget achievements is set up as well as a cap at 150%.
The Group Executive Committee is affiliated to Company pension funds complemented by additional pension coverage for a portion of the income. All Group Executive members have a notice of termination of twelve months.
In 2009, the remuneration of the members of the Group Executive Committee was based as per the table below:
Base salary (cash) + Short-term incentive Influenced Operating + Return on capital + Individual qualitative (cash) by: profit employed (ROCE) objectives + Long-term incentive Influenced Absolute total + Relative total (cash & vested shares) by: shareholder return shareholder return
Bobst Group Financial statements 2010 Consolidated financial statements 113 Notes to the consolidated financial statements
In million CHF
Note 41 (continued) Board and Executive compensation disclosures as required by Swiss law
Upper and middle management The remuneration of the upper and middle management is composed of a fixed and a variable portion.
According to the organizational level, the variable portion represents 10 to 40% of the fixed compensation, and depends on such factors as Group operating results, and Group ROCE, and/or direct responsibility results and/or bookings and sales and achievement of personal objectives fixed each year. All amounts are paid in cash. Management is affiliated to Company pension funds, according to conditions and regulations and/or labor market competitiveness.
Compensation for members of governing bodies
Total remuneration of the Board of Directors In 2010, the Board of Directors has decided to reduce the annual fees of the Board members by 10%. The total remuneration granted in 2010 to the members of the Board of Directors amounts to CHF 1.33 million.
Members of the Board Cash in CHF
Charles Gebhard, Chairman 309'000 Thierry de Kalbermatten, Vice Chairman 219'000 Ulf Berg 138'000 Christian Engel 138'000 Michael W.O. Garrett 138'000 Maia Wentland Forte (retired from the Board AGM 28.04.2010) 78'000 Hans Rudolf Widmer 156'000 Alain Guttmann 156'000 Total remuneration 2010 1'332'000
In 2009, due to the worldwide economic crisis and its repercussions on the Group, the Board of Directors had decided to reduce the annual fees of the Board members by 20%. The total remuneration granted in 2009 to the members of the Board of Directors amounts to CHF 1.26 million.
Members of the Board Cash in CHF
Charles Gebhard, Chairman 276'000 Thierry de Kalbermatten, Vice Chairman 196'000 Ulf Berg 132'000 Luc Bonnard (retired from the Board AGM 06.05.2009) 62'000 Christian Engel 124'000 Michael W.O. Garrett 124'000 Maia Wentland Forte 140'000 Hans Rudolf Widmer 140'000 Alain Guttmann (elected AGM 06.05.2009) 70'000 Total remuneration 2009 1'264'000
None of the Board members are affiliated to the Group’s pension funds.
In addition, the Group had to pay the contribution for the Federal Old Age, Survivor and Disability Insurance (AVS) and the Unemployment Insurance for a total amount of CHF 59'252.– (2009: CHF 58'607.–).
114 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 41 (continued) Board and Executive compensation disclosures as required by Swiss law
Total remuneration of the members of the Group Executive Committee The total remuneration of the six members of the Group Executive Committee in 2010 amounts to CHF 5.85 million (details as per table below).
Base salary Variable portion Pension Payment in Total plans kind 2010
Cash CHF Cash CHF Shares CHF CHF CHF number*
Total remuneration: Group Executive Committee 2'676'480 1'638'559 4'226 1'357'213 25'920 5'854'010 Highest compensation: Jean-Pascal Bobst, CEO 678'500 593'248 1'539 397'995 4'320 1'730'815
The total remuneration of the nine members of the Group Executive Committee in 2009, pro rata to the period of their mandate (average equivalent of 6.6 full time), amounts to CHF 5.06 million.
Base salary Variable portion Pension Payment in Total plans kind 2009
Cash CHF Cash CHF Shares CHF CHF CHF number*
Total remuneration: Group Executive Committee 3'024'992 1'560'020 4'080 314'355 28'440 5'058'770 Highest compensation: Jean-Pascal Bobst, CEO 573'167 281'171 1'075 53'494 4'320 946'658
* The value of a bonus in shares, the sale of which is blocked for a period of three years, is equal to 83.96% of their market value at the date of attribution. The share price at the date of attribution was CHF 43.92 (2009: CHF 38.23).
In addition, the Group had to pay the contribution for the Federal Old Age, Survivor and Disability Insurance (AVS) and the Unemployment Insurance for a total amount of CHF 227'128.– (2009: CHF 242'052.–).
Compensations for former members of governing bodies During the year under review, there were no compensations conferred to former members of governing bodies in relation with their former activity as governing bodies or not conform with market practice by Bobst Group SA or one of the subsidiaries.
In 2009, CHF 6.8 million were conferred to the three Group Executive Committee members having left the GEC. There were no other compensations conferred to former members of governing bodies in relation with their former activity as governing bodies or not conform with market practice by Bobst Group SA or one of the subsidiaries.
Options There are no options programs.
Bobst Group Financial statements 2010 Consolidated financial statements 115 Notes to the consolidated financial statements
In million CHF
Note 41 (continued) Board and Executive compensation disclosures as required by Swiss law
Additional fees and remunerations Honorariums of CHF 8'750.– (2009: CHF 107'000.–) have been billed to Bobst Group SA by Mr. Thierry de Kalbermatten, who is Vice Chairman of the Board of Directors of Bobst Group SA, of CHF 334'650.– (2009: CHF 112'000.–) by CapDconsulting Guttmann, Lussy-sur-Morges, owned by Mr. Alain Guttmann, member of the Board of Directors of Bobst Group SA, and of CHF 11'000.– (2009: CHF 0.–) by BLR & Partners AG, Thalwil, whose associate, Mr. Ulf Berg, is member of the Board of Directors of Bobst Group SA.
Loans granted to governing bodies No loans or guarantees are granted to members of the Board of Directors of the Group Executive Committee or parties closely linked to them.
Share ownership The total number of Bobst Group SA shares owned as of 31 December 2010 by non-executive members of the Board, by Group Executive Committee members and by persons closely linked to them was:
Non-executive Number of shares Group Executive Number of shares Members of the Board owned Committee Members owned
Charles Gebhard 2'000 Jean-Pascal Bobst 4'005 Thierry de Kalbermatten 90 Christian Budry 3'851 Christian Engel 1'000 Claude Currat 5'296 Hans Rudolf Widmer 900 Hakan Pfeiffer 3'143 Michael W.O. Garrett 2'000 Pierre-Yves Mueller 600 Total 2010 5'990 Total 2010 16'895
The total number of Bobst Group SA shares owned as of 31 December 2009 by non-executive members of the Board, by Group Executive Committee members and by persons closely linked to them was:
Non-executive Number of shares Group Executive Number of shares Members of the Board owned Committee Members owned
Charles Gebhard 2'000 Jean-Pascal Bobst 2'850 Thierry de Kalbermatten 90 Christian Budry 3'851 Christian Engel 89'436 Claude Currat 5'296 Hans Rudolf Widmer 700 Daniel Jourdan 5'149 Michael W.O. Garrett 2'000 Hakan Pfeiffer 658 Erik Bothorel 5'323 Pierre-Yves Mueller 80 Total 2009 94'226 Total 2009 23'207
Persons closely linked to the non-executive members of the Board and to the Group Executive Committee members are their spouse, their children under the age of eighteen, any legal entities that they own or otherwise control, or any legal or natural person who is acting as their fiduciary.
116 Bobst Group Financial statements 2010 Consolidated financial statements Notes to the consolidated financial statements
In million CHF
Note 42 Risk assessment disclosures as required by Swiss law
As part of the Group risks and opportunities management system, a systematic procedure for identifying and assessing risks and opportunities as well as for implementing appropriate risk control mechanisms is in place. During the risk assessment, Group units evaluate the financial impact of the most significant ones on their results.
The outcome of the assessment and the approved measures are summarized in a report which is made available to the Group Executive Committee member who is responsible for the unit.
In addition, a risk evaluation and prioritization is prepared by the Group Executive Committee. The result is discussed with the Audit Committee of the Board of Directors.
Financial risk management is described in more detail in note 3 to the Group’s consolidated financial statements.
Bobst Group Financial statements 2010 Consolidated financial statements 117 List of the Group companies
Status 31 December 2010 Activities Production Other Currency Share capital in local currency Control % Consolidation Sales and services Holding company Switzerland Bobst Group SA, Prilly CHF 17'810'002 n
Affiliated companies Germany Bobst Beteiligungsgesellschaft GmbH, Hamburg EUR 9'407'771 100.0 C n Bobst Group Deutschland GmbH, Meerbusch EUR 2'000'000 100.0 C n Steuer GmbH, Leinfelden-Echterdingen EUR 5'601'000 100.0 C n n Fischer & Krecke GmbH, Bielefeld EUR 1'534'000 100.0 C n n Belgium Bobst Group Benelux NV, Berchem EUR 124'000 100.0 C n Denmark Bobst Group Scandinavia ApS, Copenhagen DKK 125'000 100.0 C n Spain Bobst Group Iberica, S.L. Barcelona EUR 700'000 100.0 C n France Bobst SA, Antony, (branch) – – – – n Martin, Villeurbanne EUR 11'360'000 100.0 C n n Rapidex SM., Angers EUR 610'000 100.0 C n n Great Britain Bobst Group (UK Holdings) Ltd, Redditch GBP 24'478'115 100.0 C n Bobst Group (UK & Ireland) Ltd, Redditch GBP 2 100.0 C n General Vacuum Equipment Ltd, Heywood GBP 4'000'100 100.0 C n n Italy Bobst Group Italia SpA, Piacenza EUR 6'486'000 100.0 C n n Poland Bobst Group Polska Sp. Z o.o., Lodz PLN 50'000 100.0 C n Russia Bobst Group Vostok LLC., Moscow RUB 200'000 100.0 C n Switzerland Asitrade AG, Granges CHF 1'000'000 100.0 C n n Bobst SA, Prilly CHF 30'409'730 100.0 C n n Bobst Group Trading SA, Prilly CHF 1'000'000 100.0 C n Czech Republic Bobst Group Central Europe spol. s r.o., Brno CZK 100'000 100.0 C n Tunisia Bobst Group (Africa & Middle East) Ltd., Tunis TND 10'000 100.0 C n Brazil Bobst Group Latinoamérica do Sul Ltda, Itatiba BRL 34'696'041 100.0 C n n United States Bobst Group North America, Inc., Roseland USD 575'960 100.0 C n Mexico Bobst Group Latinoamérica Norte S.A. de CV, Mexico MXN 200'000 100.0 C n P.R. of China Bobst (Shanghai) Ltd, Shanghai CNY 52'216'742 100.0 C n n Hong Kong Bobst Group Hong Kong Ltd, Hong Kong USD 2 100.0 C n India Bobst India Private Ltd, Pune INR 235'311'400 100.0 C n n Indonesia PT Bobst Group Indonesia, Jakarta IDR 885'000'000 100.0 C n Japan Bobst Group Japan Ltd, Tokyo JPY 200'000'000 100.0 C n Malaysia Bobst Group Malaysia SDN. BHD., Petaling Jaya MYR 250'000 100.0 C n Singapore Bobst Group Singapore Pte Ltd, Singapore SGD 100'000 100.0 C n Taiwan Bobst Group Taiwan Ltd, Taipei TWD 5'000'000 100.0 C n Thailand Bobst Group Thailand Ltd, Bangkok THB 25'000 100.0 C n
Associated companies Germany Duo-Technik GmbH, Lauterbach EUR 72'000 40.0 E n Germany BHS Group, Weiherhammer EUR 6'000'000 30.0 E n n
C = Full consolidation method E = Equity method
118 Bobst Group Financial statements 2010 Consolidated financial statements Bobst Group Financial statements 2010 Consolidated financial statements 119
35_SWP.indd 119 28.03.2011 14:30:19 120 Bobst Group Financial statements 2010 Consolidated financial statements
35_SWP.indd 120 28.03.2011 14:31:00 Bobst Group SA, statutory accounts Balance sheet at 31 December of Bobst Group SA
In million CHF
2010 2009
Assets Participations and loans to affiliated companies 491.3 402.7 Other financial fixed assets 0.0 6.7 Financial fixed assets 491.3 409.4
Miscellaneous receivables from affiliated companies 0.8 2.6 Miscellaneous receivables 0.7 2.0 Other financial assets 28.0 0.0 Cash and cash equivalents (including own shares) 120.3 216.9 Prepaid expenses 2.8 3.7 Current assets 152.6 225.2
Total assets 643.9 634.6
Liabilities Share capital 17.8 17.8 Reserves: – general 7.2 7.2 – own shares 1.4 1.4 Available earnings: – balance carried forward 124.6 97.1 – profit for the year 8.8 27.5 Equity 159.8 151.0
Debenture bonds 350.0 470.0 Provisions 1.7 1.1 Non-current liabilities 351.7 471.1
Debenture bonds 120.0 0.0 Debts to affiliated companies 0.4 0.7 Short-term debts 12.0 11.8 Current liabilities 132.4 12.5
Total liabilities and equity 643.9 634.6
Bobst Group Financial statements 2010 Bobst Group SA, statutory accounts 121 Profit and loss statement of Bobst Group SA
In million CHF
2010 2009
Income Income from affiliated companies 50.4 50.3 Income on disposal of financial assets 0.0 2.8 Financial income 1.6 2.8 Total 52.0 55.9
Costs Administration and other costs -9.3 -8.8 Financial costs -25.9 -18.3 Allocation to depreciations and provisions -8.0 -1.0 Total -43.2 -28.1
Profit before income tax 8.8 27.8 Income tax 0.0 -0.3 Net profit 8.8 27.5
122 Bobst Group Financial statements 2010 Bobst Group SA, statutory accounts Notes to the financial statements and proposal for the appropriation of available earnings (Bobst Group SA)
Accounting principles
General Bobst Group SA is the holding company of the Bobst Group. The annual accounts are prepared in accordance with the Swiss law and with generally accepted principles.
Conversion of foreign currencies The transactions in foreign currencies are converted to Swiss francs (CHF) at the prevailing rate on the date of the transactions. The necessary provisions for exchange rate variances are made when preparing the Balance Sheet.
Participations and receivables related to investments The participations and loans are carried at their gross acquisition values, reduced by necessary provisions. The evaluation of the participations covers essentially the profitability, this in accordance with the principle of prudence.
Explanatory notes for various elements
A. Balance sheet Participations and loans to affiliated companies The complete list of affiliated companies of the Bobst Group is found at the end of the consolidated financial statements. This list also provides information concerning the activities of each entity.
2010 2009
Subdivision: Participations 307.6 307.6 Loans to affiliated companies 183.7 95.1 Total 491.3 402.7
Cash and cash equivalents These include, for CHF 1.4 million, own shares for which the details are provided in note 28 of the consolidated financial statements.
Share capital The information concerning the share capital, as well as the details of the major shareholders, are found in note 28 of the consolidated financial statements.
Bobst Group Financial statements 2010 Bobst Group SA, statutory accounts 123 Notes to the financial statements and proposal for the appropriation of available earnings (Bobst Group SA)
Debenture bonds Amount: CHF 120.0 million Length: eight years, fixed Maturity: 8 July 2011 Rate: 3¼% Quotation: SIX Swiss Exchange
Amount: CHF 100.0 million Length: five years, fixed Maturity: 23 July 2013 1 Rate: 4 /8% Quotation: SIX Swiss Exchange
Amount: CHF 250.0 million Length: six years, fixed Maturity: 22 June 2015 Rate: 5% Quotation: SIX Swiss Exchange
Contingent liabilities 2010: guarantees CHF 218.3 million 2009: guarantees CHF 224.4 million
B. Profit and loss statement All the incomes and expenses concern exclusively the activities of the Holding company and require no special comments.
C. Board and Executive compensation disclosures The disclosures required by the Swiss Law on Board and Executive compensation are shown on pages 112 to 116.
D. Risk assessment disclosures The disclosures required by the Swiss Law on Risk assessment are shown on page 117.
In million CHF
Proposal for the appropriation of available earnings 2010 2009
Carried forward 124.6 97.1 Reduction of capital, net of transfer of own shares reserve 0.0 0.0 Dividends unpaid on own shares 0.0 0.0 Profit for the year 8.8 27.5 Total 133.4 124.6
The proposal is as follows: Dividend of CHF 0.00 / CHF 0.00 per share 0.0 0.0 Balance to retained earnings 133.4 124.6 Total 133.4 124.6
124 Bobst Group Financial statements 2010 Bobst Group SA, statutory accounts Bobst Group Financial statements 2010 Bobst Group SA, statutory accounts 125
34_SWP.indd 125 28.03.2011 14:43:21 126 Bobst Group Financial statements 2010 Bobst Group SA, statutory accounts
34_SWP.indd 126 28.03.2011 14:46:43 Certain statements in the annual report, including but not limited to those regarding expectations for general economic development and the market situation, expectations for customer industry profitability and investment willingness, expectations for Company growth, development and profitability and the realization of synergy benefits and cost savings, and statements preceded by “expects”, “estimates”, “forecasts” or similar expressions, are forward-looking statements. These statements are based on current decisions and plans as well as on currently known factors. They involve known and unknown risks and uncertainties which may cause the actual results to materially differ from the results currently expected by the Company. Potential risks and uncertainties include such factors as general economic conditions, foreign exchange rate fluctuations and interest rate fluctuations, competitive product and pricing pressures, the Company’s operating conditions, and regulatory developments.
The annual report is available in English and French. In case of doubt, the English version prevails.
127 CCOUVERTURE_BOBST_SWP.indd 1 O U V E R T U R Tel. +41 21 621 21 11 21 621 21 +41 Tel. Tel. +41 21 621 25 60 Switzerland Share Register or1268465,4 Telekurs:SIX BOBNN,4 or1268465 BOBNN EXCHANGE: SWISS SIX Switzerland This cover was hot foil stamped stamped foil hot was cover This CH-1001 Lausanne CH-1001 CH-1001 Lausanne CH-1001 and embossed on a Bobst aBobst on embossed and Reuters: BOBNN.S Reuters: P.O. Box P.O. P.O. Box P.O. [email protected] E-mail: www.bobstgroup.com Bobst GroupSA Bobst Bobst Group SA Bobst Disclosure of shareholdings: enter press equity press SW BOBNN Bloomberg: ISIN: CH0012684657 ISIN: Relations: Investor Fax +41 21 621 20 70 Fax +41 21 621 20 69 Fax +41 21 621 20 37 Expertfoil E _ B O B S T _ ® S 104 FR Autoplaten 104 FR W P . i n d d
1 ® press.
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