ANNUAL REPORT 2003 (Cont 02 EXECUTIVE COMMITTEE and BOARD of DIRECTORS
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ANNUAL REPORT 2003 (Cont 02 EXECUTIVE COMMITTEE AND BOARD OF DIRECTORS 03 LETTER FROM MANAGEMENT 04/05 KEY FIGURES AND PERFORMANCE INDICATORS 06/07 HISTORY AND ORGANIZATIONAL CHART LISI PROFILE 08/09 SHARED CONCEPTS STRATEGIC POSITIONING 10/11 THE YEAR’S EVENTS 12/13 LISI AEROSPACE 14/15 LISI AUTOMOTIVE 16/17 LISI COSMETICS 18/19 HUMAN RESOURCES & INDUSTRIAL ESTABLISHMENTS 20/21 INVESTMENTS & RESEARCH AND DEVELOPMENT 22/23 SAFETY AND THE ENVIRONMENT tents25/27 STOCK MARKET DATA ) BOARD OF DIRECTORS AND EXECUTIVE COMMITTEE THE BOARD OF DIRECTORS* THE EXECUTIVE COMMITTEE GILLES KOHLER SAMUEL BELEY Chairman Vice President Operations of LISI AUTOMOTIVE EMMANUEL VIELLARD ISABELLE CARRERE Deputy Chairman Deputy Chief Executive Officer and Chief Financial Officer of LISI AEROSPACE JEAN-LOUIS COLDERS ERIC ANDRE Chief Executive Officer of LISI AEROSPACE Director ERIC DESPRES ROLAND BURRUS Vice President, Finance of LISI COSMETICS Director MICHEL GUIGNARD PASCAL LEBARD Vice President Operations of LISI Director Chairman and Chief Executive Officer of LISI COSMETICS CHRISTIAN PEUGEOT GILLES KOHLER Director Chairman and Chief Executive Officer of LISI JEAN-PHILIPPE KOHLER JEAN-PHILIPPE KOHLER Vice President of LISI Permanent Representative of CIKO Chairman of LISI AUTOMOTIVE to the LISI Board of Directors Director GEORGES LAMMOGLIA Chief Executive Officer of LISI AUTOMOTIVE THIERRY PEUGEOT Permanent Representative of CID PATRICK MEADE to the LISI Board of Directors President and Chief Executive Officer, HI-SHEAR Corp. Director DANIEL PITSCHMANN CHRISTOPHE VIELLARD Vice President Sales and Marketing of LISI AUTOMOTIVE Permanent Representative of VMC LAURENT SANCHEZ to the LISI Board of Directors Deputy Chief Executive Officer and Chief Financial Officer Director of LISI AUTOMOTIVE EMMANUEL VIELLARD Deputy Chief Executive Officer of LISI Chairman of LISI AEROSPACE * As of 31st December 2003. LETTER FROM THE MANAGEMENT 02/03 As predicted in our previous annual report, 2003 was a testing group delivers millions of components each week. Attaining year for LISI’s key markets. this objective will be one of the major challenges for all our divisions in the coming years. Indeed, deliveries of aircraft with over 100 seats fell by 14% in 2003. BOEING’s sharp decline allowed Airbus to become the .In 2003, we completed a comprehensive diagnostic of world’s largest manufacturer, with the European group main- Environmental Hygiene and Safety-related non-com- taining its number of deliveries above the 300 mark. In the pliances with respect to our own Rules on the subject, at automotive field, worldwide sales of our main customers, PSA, practically all of our French sites. Our declared aim for 2004 Renault and Volkswagen, have on the whole remained stable is to halve the number of non-compliances per site and to compared with the previous year. Finally, latest figures show reduce the number of work-related accidents by the same that the consumption of alcohol-based perfume products sold factor through Selective Distribution has dropped by a few points. These examples demonstrate that LISI and its employees are At the same time, the acquisition projects we have been wor- strongly committed to moving forward so as to ensure the king on have not been successful; thus, 2003 will have been company’s sustainable development, most notably by control- our 1st acquisition-free year since 1999. ling the potential risks that have been identified. In this context, the 1.1% constant-dollar* This commitment is also evident when one increase in LISI’s consolidated sales, to looks at the improvement of LISI’s consolida- 506 million €, bears witness to the ability of LISI, is an acronym ted results for 2003: at 51.9 million €, or our teams to regularly improve our market for LInk Solutions 10.2% of sales, Operating Income (EBIT) rose shares. for Industry, by over 10%; net income increased from 12.4 million € to 21.0 million €, a leap of Over the last 12 months, we have continued to which states what 69.4%; and an Operating Cash Flow of 35 mil- consolidate our commercial, industrial and we are all about! lion €, or 7.0% of sales, brought Net Financial financial performance, with the aim of impro- Debt down from 97.2 million € to 63.1 million €, ving the transparency, the reactivity and the which represents 24.6% of equity capital and reliability of our group. barely a year’s worth of Cash Flow. .On the industrial front, LISI AUTOMOTIVE launched a program Lastly, the financial year 2003 saw the 5-year extension of the to significantly cut production costs, dubbed ACE AIRBUS contract, the delivery of the first assembly components (Amélioration Continue vers l’Excellence or Continuous for the new A380 airliner and orders taken for 24 million € Improvement Towards Excellence), at the beginning of 2003; worth of new parts in the AUTOMOTIVE division, a 40% increa- this will be reinforced in 2004 and deployed in the main units se over the previous year. of the AEROSPACE division. This push for productivity is best This vote of confidence from our customers can only encoura- illustrated by the fact that Added Value per person increased ge us to pursue our efforts. On behalf of all LISI’s employees, by 7% between 2002 and 2003. we would like to offer them our warmest thanks. .With regards to Quality, we are approaching the Zero Defect Gilles Kohler level in all 3 sectors of activity, despite the fact that the LISI Emmanuel Viellard * A 2.3% decline if we take the dollar effect into account KEY FIGURES A few markers SALES: 506 Million Euros Number of employees (Registered): 4,864 AVERAGE ANNUAL SALES GROWTH SINCE 1993: 9.6% SHARE PRICE INCREASE OVER 10 YEARS: x 4,7 THE LEADER IN COMPLEX ASSEMBLY APPLICATIONS A company that is unique in Europe in terms of the diversity of its product range. LISI has the trust of prestigious customers and leads the way in its different sectors of activity: AEROSPACE, AUTOMOTIVE and COSMETICS. Total sales Sales outside France 226 228 202 221 278 325 385 462 462 541 560 518 506 53 58 40 44 67 106 155 195 190 224 262 251 243 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 CONSOLIDATED SALES (in €M) The LISI group’s consolidated annual sales stand at €506 M, a fall of 2.3%. The proportion of sales achieved outside of France remains stable, at 48.1% compared with 48.4% in 2002. 2003 SALES BY GEOGRAPHICAL 2003 SALES BY ACTIVITY (in %) AREA (in %) Others COSMETICS USA/Canada 8% 10% 12% 51% France AEROSPACE 36% 54% AUTOMOTIVE 29% Europe AND NETFINANCIALDEBT EQUITY CAPITAL EBITDA AND ROCE FLOW FREE CASH 10% mark. the againexceeding withtheEBITonce dual upturninresults, Measurements taken after September 11 September after taken Measurements and9%ofEBIT. 15% ofEBITDA of alow to hadfallen profitability thegroup’s States, the United in aerospace for year apeakin1998,record Having reached 1996 133 28 NETFINANCIALDEBTinmillionsof Equity Capital inmillionsof Equity Capital EBITDA in%Sales EBITDA 1996 49.3 15.2% inmillionsof EBITDA 1998 14.3 37.44% 1997 155 24 1997 61.5 16.0% 1999 3.7 25.43% 1998 189 46 1998 89.6 19.4% 2000 15.2 18.73% € 1999 214 52 € 1999 80.4 17.4% 2001 55.8 15.15% 2000 243 185 € 2000 81.6 15.1% 2002 43.9 12.81% 2001 259 126 th 2001 showed agra- 2001 showed 2001 86.8 15.5% 2003 35.0 15.33% 2002 252 97 2002 77.3 14.9% 2003 257 63 ROCE FREE CASH FLOW FREE CASH KEY FIGURES & PERFORMANCE INDICATORS KEY FIGURES&PERFORMANCE c ofboth neous recovery thesimulta- thanks to in2003 significantly debt. ROCEimproved its reduced has greatly LISI 3years, In thelast by 122million financial debthasfallen net 3years, In thelast ned stable. hasremai- equity capital omponents of this ratio. omponents ofthisratio. 2003 78.7 15.6% inmillionsof EBIT € 1996 31.0 9.5% , while € 1997 46.4 12.1% 1998 77.5 16.8% -100 use of the This chartrepresents FINANCIAL FLOWS 100 -50 50 0 1999 63.7 13.8% EBITDA Balance Taxes result Extraordinary Financial charges Varia Expenditure Net Capital EBITDA 8.3 1998 tion in WCR tion inWCR 2000 65.0 12.0% 1.6 1999 . EBITin%Sales EBIT inmillionsof 9.6 2001 61.6 11.0% 2000 53.3 2001 2002 47.0 9.1% 40.3 2002 32.4 2003 51.9 10.2% € 2003 04/05 Core ideas: A truly specialized business. Currently focused on strategic markets. Prestigious partner customers. Airbus, Boeing, Embraer, Bombardier, Rolls Royce, Snecma, Pratt & Whitney, GEAE, Eurocopter, and the Formula 1 and Cart teams. PSA, Renault, VAG, BMW, Daimler Chrysler, TRW, Bosch, Autoliv, Faurecia. LVMH, Chanel, L’Oréal, Yves Saint-Laurent, Puig. Several areas of synergy: 5 cross-disciplinary areas of work: ➔ industrial, ACE plan (Continuous Improvement Towards Excellence), ➔ security, the environment, risk management, ➔ purchasing, ➔ finance, insurance and strategic management: strategic and budgetary methodology, reporting, information system, ➔ human resources. 1777 1807 1899 1968 History Creation by Frédéric Japy of The firms Japy Frères and Creation in Delle (Belfort) of These three family-owned a watchmaking parts shop in Migeon & Domine jointly the Société Industrielle de companies merge to create Beaucourt near Montbéliard. decide to launch the Delle, which soon specializes GFD*, which becomes the Several years later, founding industrial manufacturing of in the manufacture of lathed leading French manufacturer in Morvillars near Belfort of wood screws made in screws. of threaded fasteners – the Migeon & Domine France. standard and automotive manufacturing plant, which nuts and bolts. later became Viellard Migeon et Compagnie (VMC). * Générale de Forgeage et de Décolletage LISI PROFILE 06/07 1 business, 3 sectors of activity The LISI group is currently one of the of total consolidated sales, LISI segment.