Page 65 - Loomis Annual Report 2017

Loomis Annual Report 2017
Administration Report 61
1,992 million (1,852), which includes amortization of acquisition- related intangible assets of SEK –55 million (–62) and acquisition- related costs of SEK –47 million (–56). In 2016 an item a ecting comparability of SEK 81 million was recognized. The item a ecting comparability in 2016 related to a capital gain recognized following the divestment of the general cargo operations.
Income before taxes of SEK 1,882 million (1,735) includes a net nancial expense of SEK –109 million (–117).
The tax expense for the year amounted to SEK –454 million (–477), which represents a tax rate of 24 percent (27). As a result of the recently passed tax reform in the USA, a one-o tax credit of SEK 70 million was reported during the fourth quarter of 2017. This item represents a remeasurement of the US operations’ deferred tax liabilities.
Earnings per share before and after dilution amounted to SEK 18.99 (16.73).
The segments
Europe*
Real growth for the European operations amounted to 5 percent (3) and organic growth was 0 percent (0). The operating margin amounted to 13.5 percent, compared to 13.4 percent the previous year.
USA
Real growth amounted to 6 percent (12) and the organic growth was 6 percent (11). The operating margin amounted to 13.1 percent, compared to 11.5 percent the previous year.
International
Revenue for the full year 2017 amounted to SEK 878 million com- pared to SEK 1,149 million in 2016. Real amounted to –24 percent (–17) and the organic growth was –6 percent (0). The lower reve- nue and the negative real growth, is mainly explained by the divest- ment of the general cargo operations on July 1, 2016. The operating margin amounted to 6.9 percent (6.7)
Cash ow
Cash ow from operations amounted to SEK 2,313 million (2,665). Cash ow from investment activities amounted to SEK –1,619 mil- lion (–1,175) which includes investments in xed assets (net) of SEK –1,152 million (–1,120) and net of acquisitions and divest- ments of operations of SEK –467 million (–55). Cash ow from nancing activities amounted to SEK –487 million (–1,510) and includes a dividend of SEK –602 million (–527).
Capital employed and nancing
Loomis’ operating capital employed amounted to SEK 4,866 mil- lion ( 4,615) which is equivalent to 28 percent (27) of revenue. The total capital employed amounted to SEK 10,860 million (10,576). Return on capital employed amounted to 19 percent (18), the net debt was SEK 3,823 million (3,929) and the equity ratio was 46 per- cent (45).
In the third quarter 2017 Loomis’ long-term business plans were prepared and, in connection with this process, impairment testing was undertaken on the Group’s cash-generating units. None of the cash generating units had a carrying amount exceeding the recover- able amount and therefore no goodwill impairment has been recorded in 2017.
Shareholders’ equity
Shareholders’ equity increased during the year by SEK 390 million to SEK 7,037 million (6,647) as of December 31, 2017. Income for
*Argentina and Chile are included in the European segment because these operations are reported and followed up as part of the European segment.
the year of SEK 1,428 million, changes is net investment hedges of SEK 179 million and actuarial gains of SEK 17 million increased shareholders’ equity by SEK 1,624 million. Translation di erences of SEK –631 million, paid dividend of SEK –602 million and share based remuneration of SEK –1 million reduced shareholders’ equity by SEK 1,234 million. The return on shareholders’ equity was 20 percent (19).
Environmental impact
The Group and the Parent Company are not engaged in any opera- tions requiring a permit under the Environmental Code.
Employees
In 2017 the average number of full-time employees was 22,811 (21,983) in 23 countries (21). The gender distribution was 31 per- cent (31) women and 69 percent (69) men. Due to the nature of Loomis’ operations, the Group’s employees assume a considerable amount of responsibility every day. Based on the demands of the Company’s operations, Loomis places great emphasis on recruiting the right employees and ensuring that they receive the necessary training. All employees undergo basic training as well as subse- quent, regular additional training. The training programs have been adapted to each country and region where Loomis operates. Managers at various levels are o ered leadership training to sup- port them in their roles. Loomis also places great emphasis on all employees complying with the Group’s core values.
Parent Company
Loomis AB is a holding company with subsidiaries in Argentina, Austria, Canada, Chile, China, Czech Republic, Denmark, Finland, France, Germany, Hong Kong, Ireland, Norway, Portugal, Singa- pore, Slovakia, Spain, Sweden, Switzerland, Turkey, the UK, United Arab Emirates and the USA. Loomis AB does not engage in any operating activities as it is only involved in providing Group Man- agement and support functions. The average number of full-time employees at the head o ce during the year was 19 (19). Net income for the year amounted to SEK 880 million (513). In the second quarter of 2017, a total of SEK 602 million (527) was distrib- uted to the shareholders, representing a dividend of SEK 8.00 per share (7.00).
Risks and uncertainties
Information on nancial risk management and the use of nancial instruments in risk management can be found in Note 6.
The economic trends in 2017 negatively a ected certain geo- graphical areas, and a similar impact on revenue and income in 2018 cannot be ruled out. Changes in the general economic condi- tions and market trends can have various e ects on demand for cash handling services; for example, through changes in the pro- portion of cash purchases relative to card purchases, changes in consumption levels, the risk of robbery and bad debt losses, and sta turnover rates.
For further information on uncertainties, refer to Note 4 Critical accounting estimates and assessments and Note 34 Contingent liabilities.
Information regarding the Loomis share
Shares issued in the Parent Company consist of both Class A and Class B shares. A Class A share carries 10 votes and a Class B share carries 1 vote. The Loomis Class B share was initially listed on the Mid Cap list of Nasdaq Stockholm on December 9, 2008. The Class B share has been listed on Nasdaq Stockholm’s Large Cap list since the beginning of 2015. Loomis’ principal owners in terms of voting power are Investment AB Latour through Latour Förvaltning AB and Melker Schörling AB. These two owners have entered into a shareholder agreement under which the parties have undertaken to