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F i n a n c i a l R e p o rt 2 0 0 2

Contents

Forbo Group consolidated financial statements
3 Financial review and analysis
7 Consolidated income statement
8 Consolidated balance sheet
9 Consolidated cash flow statement
10 Consolidated statement of changes in shareholders’ equity
11 Accounting policies
16 Notes to the consolidated financial statements
31 Report of the Group Auditors
32 Consolidated income statements 1998–2002
33 Consolidated balance sheets 1998–2002

Financial statements of Forbo Holding AG
36 Income statement
37 Balance sheet
38 Notes to the financial statements
41 Proposal for appropriation of available earnings
42 Report of the Statutory Auditors

Additional information
44 Group companies

Forbo Group consolidated financial statements

2 Forbo Financial Report 2002

Financial review and analysis

Summary of financial results

Net sales of continued operations

2002

2001

m CHF

m CHF

% change on
previous year

1,531.1

1,354.3

13.1

Net sales of divested activities
Group net sales

130.8
1,531.1

1,485.1

3.1

180.1

169.8

6.1

Operating profit before depreciation and amortizationof continued operations*of divested activities

9.6

Operating profit
of continued operations*

88.4

85.7

of divested activities
Net profit for the year

42.6

51.8

EVA (Economic Value Added)

4.3

–2.1

®

*

3.2

3.2

including Headquarters

Comment on the financial result development

The business year 2002 continued to be characterized by difficult trading conditions andthe acquisition of the Swift adhesives activities. Group total sales reached CHF 1,531.1 million, with the Swift adhesives business acquired as per April 19, 2002 contributing CHF
246.9 million. Thus, Group sales (excluding the Carpet Business divested in October 2001)
were CHF 176.8 million higher than in the previous year, corresponding with an increaseof 13.1 % in Swiss Francs. In local currencies, Group sales were up16.7 %.
The operating profit before depreciation and amortization (EBITDA) was CHF 180.1 million, CHF 10.3 million higher than in the previous year (excluding the Carpet Businessdivested in October 2001). Swift’s contribution was CHF 28.9 million. The negative influence of unfavorable exchange rates is CHF 6.6 million. As a consequence, return on sales(ROS gross, EBITDA/Sales) decreased from 12.5 % in the previous year to 11.8 %. At CHF
88.4 million, the operating profit after depreciation and amortization is CHF 2.7 million higher than in the previous year. This includes the Swift business with CHF 16.9 million after deduction of CHF 5.8 million amortization of goodwill and acquired trademarks. This means that Swift made a higher than expected contribution to the Group’s
operating profit. The operating profit before amortization (EBITA), adjusted to an entire
Swift business year, results in a return on operating assets employed (EBITA/Operating
Assets) of 8.2 % (previous year 7.9 %).

Forbo Financial Report 2002

3

–17.8

Excluding the Swift business, the continued operations reached net sales of CHF 1,284.2
million, 5.2 % and 1.6 % lower than in the previous year in Swiss Francs and local currencies, respectively. Operating results (EBIT) decreased by CHF 14.2 million, CHF 3.9 million of which as a result of currency translation differences. The quarterly results in theyear under review, except for the fourth quarter, were consecutively better than the previous ones, and the operating result in the third quarter was clearly above the previous
year on a comparable basis. The Linoleum sales development that was below the expectations in the fourth quarter, and the pronounced weakening of the dollar resulted in aclearly lower operating profit (EBIT) on a comparable basis, for both the fourth quarter andthe entire year (CHF –14.2 million). The Flooring Business accounted for the majorityof the decrease (CHF 15.0 million or –19.1 %). Despite a clear sales decrease of 11.3 %, halfof which was due to unfavorable exchange rates, the Belting Business reached an EBIT
result of CHF 10.9 million (previous year: CHF 14.4 million). As opposed, the Adhesives
Business (excluding acquisitions) recorded a sales plus of 8.2 % in local currencies and
5.4 % in Swiss Francs, and operating profits of CHF 20.7 million, 24.7 % up on the previous year. This means that also the former Forbo Adhesives Business performed wellunder difficult conditions. The operating result of continued activities (excluding the acquisitions) as a percentage of the assets employed (ROA, EBIT/Operating Assets) is now at
7.1 %, slightly lower than in the previous year (7.9 %).
Net financial expenses of CHF 24.2 million are CHF 8.2 million higher than in the previous year. The increase is mainly the result of the acquisition of the Swift activities financedwith borrowed capital. Pre-tax profit of CHF 63.5 million is CHF 9.4 million down on
the previous year, while taxes of CHF 20.9 million were nearly on the previous year’s level(CHF 21.1 million). The higher tax rate of 32.9 % (previous year: 28.9 %) is the result ofa regionally less favorable profit mix and partly non tax-deductible goodwill amortization.
Thus, the Group net profit with CHF 42.6 million was 17.8 % below the previous year,
resulting from a slightly lower operating profit, higher financial expenses, a higher tax rate,
and weaker exchange rates compared to the Swiss Franc.

4 Forbo Financial Report 2002

Balance sheet summary

31.12. 2002

31.12. 2001

m CHF

m CHF

Changem CHF

Long-term assets

875.1

716.4

158.7

Current assets (excluding cash and marketable securities)

573.1

488.7

84.4

Cash and marketable securities

152.4

126.5

25.9

1,600.6

1,331.6

269.0

Shareholders’ equity

590.6

652.2

–61.6

Financial debt

637.8

361.7

276.1

Total assets

Other liabilities and provisions
Total shareholders’ equity and liabilities

372.2

317.7

54.5

1,600.6

1,331.6

269.0

Balance sheet development

The balance sheet total rose by CHF 269.0 million to CHF 1,600.6 million compared withthe previous year-end. This is mainly due to the inclusion of the operating assets of the
Swift adhesives business of CHF 379.0 million. Of these asset additions, CHF 170.3 million
are accounted for by goodwill and acquired trademarks. In addition, cash and securities
increased by CHF 25.9 million to CHF 152.4 million. This contrasts with lower working
capital, on a comparable basis and excluding securities and cash, of CHF 573.1 million.
Furthermore, investments in long-term assets of CHF 45.2 million are clearly below theprevious year’s level (CHF 66.4 million) and depreciation during the year under review.
Of the total investment volume, CHF 22.6 million relate to the Flooring Business, CHF 10.4
million to the Adhesives Business, and CHF 10.9 million to the Belting Business. The
weaker exchange rates, against the Swiss Franc, particularly of the Dollar-based currencies,
decreased assets by some CHF 80 million.
Financial situation

Net debt rose by CHF 250.2 million compared with the previous year-end. The increaseis mainly the result of the Swift acquisition, which was financed by debt, and the dividend
payment. On the other hand, free cash flow of CHF 108.8 million led to a substantial
reduction of net debt. Of the total financial debt of CHF 637.8 million, CHF 382,3 million
are accounted for by a US private placement with maturities between five and ten years,
a Swiss Franc bond of 150.0 million (due in 2006), and bank debt of CHF 105.5 million.
This means that the long-term debt financing rests on three pillars.
Compared with the end of the previous year, the equity capital decreased to CHF 590.6
million especially as a result of unfavorable exchange rates and the dividend distribution.
This corresponds with 36.9 % of the balance sheet total at year-end 2002. This key figure
decreased compared with the previous year (49.0 %) mainly as a result of the acquisitionof the Swift adhesives business. With this equity capital basis, a gearing of 82.2 % (netdebt in percent of equity capital), and high liquidity, the Group continues to be on a solid
financial basis.

Forbo Financial Report 2002

5

Free cash flow

The free cash flow (before dividend) of CHF 108.8 million is calculated on the basis of the
cash flow from operating activities reduced by investments in long-term assets (net).
This amount does not include the purchase and sale of business activities. The increase in
the free cash flow by CHF 35.1 million is mainly due to lower investments in fixed assetsof CHF 45.2 million (previous year: CHF 66.4 million) and a higher cash inflow from disposals (CHF 16.2 million).
Earnings per share

Related to the average number of outstanding shares, the 2002 earnings per share is
CHF 32.65 compared with CHF 37.84 in the previous year, corresponding with a 13.7 %decrease. This means that the earnings per share decrease is somewhat less than theGroup’s profit decline (–17.8 %) resulting from the effect of the share buy-back programin 2001.
Share price development

Also the SWX Swiss Exchange suffered losses in the worldwide baisse of financial markets.
The Forbo share could not escape this general trend, although the losses on an annual
basis were slightly smaller than the decline of the SPI. In view of the good cash generationand the distribution policy aimed at continuity, the current market capitalization of
about CHF 500 million seems to be very low. Through restructuring and acquisitions, Forbo
has created the preconditions for achieving higher company profits should the economy
recover. Whether or not the ambitious targets can be achieved depends to a large extent,
however, on the future development of the general economic situation. Even rising company profits can only be expected to generate improved share performance if the equity
market stabilizes and the geopolitical situation calms down.
Economic Value Added (EVA® )Forbo’s objective is to enhance the value of the company. Value is only created when the
returns on the capital employed exceed the weighted average cost of capital. Despite anincrease in the capital employed and a slightly lower operating profit after tax (NOPAT, Net
Operating Profit After Tax), a positive EVA® value of CHF 4.3 million (previous year:
negative value of CHF 2.1 million) could be recorded in the year under review. This was
possible thanks to a reduction of the cost of capital to 5.5 % (previous year: 7.3 %). The
reduction of the cost of capital is mainly due to a higher percentage of borrowed capital atlower interest rates.
2002

2001

EVA®-calculation

Net operating profit after taxes (NOPAT)
Invested capital (IC)

m CHF

m CHF

67.5

67.8

1,144.9

957.2

Average interest rate after taxes

3.0 %

3.8 %

Cost of equity capital

8.4 %

9.1 %

Weighted Average Cost of Capital (WACC)

5.5 %

7.3 %

4.3

–2.1

Economic Value Added ( EVA ®)6 Forbo Financial Report 2002

Consolidated income statement
2002

Net sales

Notes

m CHF

m CHF

1/2

1,531.1

1,485.1–1,017.4–962.7

Cost of goods sold
Gross profit
Development costs

2001

3

513.7

522.4

–24.2

–22.0

–277.2–288.6

Administrative costs

4–119.6–116.6

Other operating expenses, net

5

–4.3

–6.3

Marketing and distribution costs

88.4

88.9

7

5.0

3.4

Financial expenses

8

–29.2

–19.4

Share of results of associated companies

12

–0.7

–

63.5

72.9

–20.9

–21.1

42.6

51.8

2002

2001

Operating profit
Financial income

Profit before taxes
Taxes

24

Net profit for the year

Notes

CHF

CHF

Earnings per share (basic)

9

32.65

37.84

Earnings per share (diluted)

9

32.35

37.70

Forbo Financial Report 2002

7

Consolidated balance sheet
31.12. 2002

31.12. 2001

Assets
Notes

Long-term assets

m CHF

m CHF

875.1

716.4

Tangible assets

10

586.9

576.1

Intangible assets

11

178.6

23.2

Deferred taxes

24

65.6

72.7

Investments in associates and other long-term assets

12

Current assets

44.0

44.4

725.5

615.2

Inventories

13

255.9

227.0

Trade receivables

14

254.8

202.6

27.0

30.1

35.4

29.0

23.9

33.8

128.5

92.7

1,600.6

1,331.6

31.12. 2002

31.12. 2001

Other receivables
Prepaid expenses and deferred charges
Marketable securities

15

Cash and cash equivalents
Total assets

Shareholders’ equity and liabilities
Notes

Shareholders’ equity

m CHF

m CHF

590.6

652.2

Share capital

16

67.8

75.7

Treasury shares (2001 incl. share buy-back program)

16

–11.7

–155.2

Reserves and retained earnings

534.5

731.7

Long-term liabilities

638.6

252.8

Long-term financial debt

17

539.3

164.5

Employee benefit obligations

18

68.9

69.8

Provisions

19

22.6

16.4

Deferred taxes

24

7.8

2.1

371.4

426.6

Current liabilities
Trade payables

20

107.3

79.4

Accrued expenses

21

116.7

95.0

Short-term financial debt

22

98.5

197.2

Other current liabilities
Total shareholders’ equity and liabilities

8 Forbo Financial Report 2002

48.9

55.0

1,600.6

1,331.6

Consolidated cash flow statement
2002

2001

Cash flow from operating activities
m CHF

m CHF

Net profit for the year

42.6

51.8

Depreciation of tangible assets

80.5

85.9

Amortization of intangible assets

11.2

4.5

Share of results of associated companies

0.7

0.0

Adjustment for net financial expenses

24.2

16.0

Interest paid

–25.4

–16.4

3.9

2.7

Interest received
Dividends received

0.6

0.7

Adjustment for tax expense

20.9

21.1

Taxes paid

–17.0

–33.7

Increase (+)/decrease (–) in provisions

–6.7

–4.5

Increase (+)/decrease (–) in current liabilities (excl. short-term debt)

–9.5

2.5

Increase (–)/decrease (+) in current assets

1)

Total cash flow from operating activities

11.8

4.8

137.8

135.4

2002

2001

Cash flow from investing/divesting activities
m CHF

m CHF

0.0

56.7

Cash used for acquisitions–335.8–15.3

Increase (–) in long-term assets

–45.2

–66.4

Decrease (+) in long-term assets

16.2

4.7

–364.8–20.3

Cash flow from divestments (incl. costs)2)

Total cash flow from investing activities (before securities)
Increase (–)/decrease (+) in marketable securities
Total cash flow from investing activities

0.0

3.9

–364.8

–16.4

2002

2001

Cash flow from financing activities
Share buy-back 2001 (incl. costs)

m CHF

m CHF

0.0

–149.2

Increase (+)/decrease (–) in long-term financial debt

395.2

21.8

Increase (+)/decrease (–) in employee benefit obligations

–2.0

–8.5

Increase (+)/decrease (–) in short-term financial debt

–96.4

5.1

Change in treasury shares

–2.0

–0.3

Dividend paid

–29.0

–32.4

Total cash flow from financing activities

265.8–163.5

2002

2001

m CHF

m CHF

Increase (+)/decrease (–) in cash and cash equivalents

38.8

–44.5

Translation differences

–3.0

–0.4

Cash and cash equivalents at the beginning of the year

92.7

137.6

Cash and cash equivalents at the end of the year

128.5

92.7

Change in cash and cash equivalents

excluding cash and marketable securities
2)change in net debt

1)

Forbo Financial Report 2002

9

Consolidated statement of changes inshareholders’ equity
2001

At 1.1.2001

Sharecapitalm CHF

Treasurysharesm CHF

Reservesm CHF

Translationdifferences
m CHF

Total
m CHF

75.7

–8.2

808.6

–62.2

813.9
–1.8

Change in accounting policies (IAS 39)–1.8

Net profit for the year

51.8

51.8

–2.5

–149.2–146.7

Share buy-back (incl. costs)

–0.3

–0.3

Other changes in treasury shares
Fair value adjustments:
Marketable securities–7.7

Cash flow hedges

–0.9

–7.7
–0.9
–20.1

Translation differences–1.1

Realization due to divestments

–1.1
–32.4

–32.4

Dividend paid

–20.1

75.7

–155.2

815.1

–83.4

652.2

Share
capitalm CHF

Treasurysharesm CHF

Reservesm CHF

Translationdifferences
m CHF

Total
m CHF

75.7

–155.2

815.1

–83.4

652.2

–7.9

146.7

–138.8

0.0

–3.2

1.2

–2.0

Marketable securities

–9.8

–9.8

Cash flow hedges

5.8

At 31.12.2001

2002

At 1.1.2002

42.6

Net profit for the year
Elimination of own shares from share buy-back 2001
Other changes in treasury shares

42.6

Fair value adjustments:–29.0

Dividend paid
At 31.12.2002

10 Forbo Financial Report 2002

5.8
–69.2

Translation differences
67.8

–11.7

687.1

–69.2
–29.0

–152.6590.6

Accounting policies
Basis of preparation

The Group’s consolidated financial statements are prepared in accordance with the historical cost convention and comply with International Financial Reporting Standards (IFRS)
as issued by the International Accounting Standards Board (IASB) and Swiss law.
The preparation of financial statements requires management to make estimates andassumptions that affect the reported amounts of assets and liabilities and disclosureof contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
Scope of consolidation

The consolidated financial statements include Forbo Holding AG and all subsidiaries overwhich the Group exercises a controlling influence. A controlling influence normally exists
when the Group owns more than 50 % of the voting rights in a company. Intra-grouptransactions and balances are eliminated.
Companies acquired during the reporting year are included in the consolidated financial
statements as of their acquisition date, and all companies disposed of are eliminated fromthe accounts as of the date of disposal. The companies included in the consolidated financial statements are listed under Group companies (pages 44–46). Companies in which theGroup has a minority interest between 20 % and 50 % are included in the consolidated
financial statements using the equity method of accounting and are presented as investments in associates. Investments below 20 % are valued at their fair value.
Capital consolidation

The purchase method is used, whereby goodwill is capitalized and amortized over its estimated useful life (but over a period not exceeding twenty years). The value of the net
capitalized balance is reviewed at the end of the year. Where an indication of impairment
exists, the carrying amount is written down to the recoverable amount.
Foreign currency translation

The assets and liabilities of Group companies which do not report in Swiss Francs as theirreporting currency are translated at year-end exchange rates and their income statements
are translated at weighted average exchange rates for the year. Currency translation differences arising from changes in exchange rates between the beginning of the year and theend of the year and the difference in net income translated at weighted average and yearend exchange rates are taken directly to shareholders’ equity. Exchange gains and losses
arising from long-term intra-group financings with equity character denominated in foreign currencies are likewise taken to shareholders’ equity. On the disposal of a company,
the cumulative amount of these exchange differences is recognized in the income statement
together with the disposal gain or loss.
Exchange gains and losses arising in Group companies from transactions in foreign currencies are taken to the income statement.

Forbo Financial Report 2002

11

Tangible assets

Tangible assets are stated at their acquisition or production cost less depreciation overtheir estimated useful lives. Depreciation is charged on a straight-line basis over thirty
years for buildings and over a period of three to ten years for machinery, equipment andother tangible assets. Where the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its recoverable amount. The samedepreciation rules apply for leased assets where the Group companies assume all therisks and rewards of ownership (financial leasing). These assets are capitalized at the present value of the underlying lease payments. The corresponding payment obligations,excluding the associated financing costs, are shown in the balance sheet as short- and longterm financial debt, depending on their due date. The interest element of the financing
is charged to the income statement over the lease period.
Expenditures for maintenance and repairs are charged directly to the income statement,
whereas expenditures which enhance the value of assets, are capitalized.
Intangible assets

Intangible assets, other than goodwill, comprise mainly patents, licenses and trademarks
acquired from third parties. These assets are capitalized and depreciated on a straight-line
basis over their estimated useful life (but over a period not exceeding twenty years). The
value of the net capitalized balance is reviewed at the end of the year, and allowance is madefor any impairment in value where the capitalized balance is considered to exceed thefuture benefits.
Inventories

Inventories of raw materials, work in progress and finished goods are valued at the lowerof their average acquisition cost or, where applicable, group production cost and theirmarket (net realizable) value. The valuation of work in progress and finished goods includes
related production overheads. Appropriate allowance is made for excess and obsolete
inventories and reductions in sales prices. Unrealized profits on inventories resulting fromintra-group transactions have been eliminated in the income statement
and balance sheet.
Trade receivables

Trade receivables are stated at their nominal value less necessary allowance for doubtfulreceivables. Allowance is made for individual receivables positions for which recovery is
doubtful. A general allowance is made on the basis of past experience.
Marketable securities

The Group classifies its marketable securities as available-for-sale. Available-for-sale marketable securities are initially recorded at cost and subsequently carried at fair value,with all changes in fair value recorded in equity. When available-for-sale marketable securities are sold, the cumulative gains and losses previously recognized in equity are included in financial income or expense for the current period.
Cash and cash equivalents

Cash and cash equivalents include highly liquid investments with original maturities ofthree months or less. This position is readily convertible to known amounts of cash.

12 Forbo Financial Report 2002

Deferred taxes

Deferred income taxes are accounted for using the ‘balance sheet liability’ method.
Provisions for deferred taxes are established in respect of all temporary differences between
the tax values of assets and liabilities and their values in the consolidated financial statements. Deferred taxes are calculated on the basis of standard local tax rates, with immediate adjustment for any changes in the relevant tax law. Deferred tax assets arising from a
reduction of future tax liability due to the carry forward of allowable losses and valuationdifferences are shown as assets only if levels of forecast profits make it likely that such tax
assets will be realized.
Pension plans

For defined contribution plans, the expense charged to the income statement correspondswith the contributions made by the Group companies.
For defined benefit plans, the pension costs are assessed using the projected unit credit
method. Under this method, the cost of providing pensions is charged to the income
statement so as to spread the regular cost over the service lives of employees in accordancewith the advice of qualified actuaries. Actuarial gains and losses exceeding 10 % of thegreater of the employee benefit obligation and the plan assets are amortized over the average remaining service lives of employees. As a rule full actuarial valuations are carriedout every three years and up-dated during the intervening period. The pension obligationis measured as the present value of the estimated future cash outflows using interest
rates of long-term high quality corporate bonds. The capitalization of surpluses of fundedplans is limited to the net total of any unrecognized losses and past service cost, andthe present value of any economic benefits available in the form of refunds from the plansor reductions in future contributions to the plan.
Provisions

Provisions are recognized when the Group has a present or constructive obligation as aresult of past events, it is probable that an outflow of resources will be required to settle
the obligation, and a reliable estimate of the amount can be made.
Warranties

On the basis of past experience, provision is made for warranty costs at the time the sales
revenue is recognized.
Treasury shares

The Group’s holding in its own equity instruments are recorded as a deduction fromequity. The original cost of acquisition, consideration received for subsequent resale ofthese instruments and other movements are reported as changes in equity.
Revenue recognition

Revenues from the sale of goods are recognized at the time of transfer of the risks andrewards of ownership to the buyer. All costs incurred in connection with sales are appropriately accrued.

Forbo Financial Report 2002

13

Research and development

Expenditure under this heading refers exclusively to development and design activities andis charged to the income statement as and when incurred.
Derivative financial instruments

Derivative financial instruments held to hedge the Group’s exposure to financial risks are
initially recognized at cost and subsequently remeasured at their fair value. The method ofrecognizing the resulting gain or loss is dependent on the nature of the item being hedged.
On the date a derivative contract is entered into, the Group designates certain derivatives
as either a hedge of the fair value of a recognized asset or liability (fair value hedge) ora hedge of the fair value of a forecasted transaction or of a firm commitment (cash flow
hedge). Changes in the fair value of derivatives that are designated and qualify as fair value
hedges and that are highly effective, are recorded in the income statement, along with any
changes in the fair value of the hedged asset or liability that is attributable to the hedgedrisk. Changes in the fair value of derivatives that are designated and qualify as cash flow
hedges and that are highly effective, are recognized in equity. Where the forecasted transaction or firm commitment results in the recognition of an asset or of a liability, the gains
and losses previously deferred in equity are transferred from equity and included in
the initial measurement of the cost of the asset or liability. Otherwise, amounts deferredin equity are transferred to the income statement and classified as revenue or expensein the same periods during which the hedged firm commitment or forecasted transaction
affects the income statement.
Changes in the scope of consolidation

Due to acquisitions during the year under review, the scope of consolidation increased by
the following companies:
As from April 1, 2002:
SABA Klebstoff- und Abdichtungssysteme GmbH, Germany
As from April 19, 2002:
Forbo Adhesives L.L.C., USA
Forbo Adhesives (Canada) Ltd., Canada
Forbo Swift Adhesives SA, France
Heitz Alsacol Indus SA, France
Forbo Costenaro Mino S.p.a., Italy
Forbo Swift Adhesives Ltd., United Kingdom
Swift Adhesives B.V., the Netherlands
Oy Forbo Swift AB, Finland
Swift Adhesifs S.A., Spain
Forbo Swift Adhesives Greece S.A.I.C., Greece
Forbo Swift Sweden AB, Sweden
Waller & Wickham Ltd., Ireland
Swift Adhesives Poland Sp. z o.o., Poland
Swift Hungary Kft., Hungary
As from September 1, 2002:
Balco Chemie Benelux BVBA, Belgium

14 Forbo Financial Report 2002

As from October 1, 2002:
Stephens Miraclo Extremultus Ltd., United Kingdom
Blacum Ltd., Ireland
Description of terms

Free cash flow

Cash flow from operating activities less cash flow used for investments in long-term assets,
net (excl. marketable securities).
EVA®

EVA® (EconomicValue Added) is a financial figure indicating how much value a company

has generated in a given year. Our calculations based on the Capital Asset Pricing Model(CAPM) resulted in weighted average cost of capital (WACC) of 5.5% (2001: 7.3%).
EVA® = NOPAT -WACC x IC
NOPAT : Net Operating Profit After Tax
WACC : Weighted Average Cost of Capital
IC : Invested Capital

Operating assets

Total of tangible and intangible assets, inventories, trade receivables, other receivables,
prepaid expenses and deferred charges.
Operating liabilities

Total of trade payables, accrued expenses, other current liabilities, employee benefit obligations and provisions.

Forbo Financial Report 2002

15

Notes to the consolidated financial statements
Segment information
1

By business segments 2002
Net sales

Flooring
m CHF

Adhesivesm CHF

Belting
m CHF

736.1

486.6

308.4

Corporate andconsolidation
m CHF

Total
m CHF

1,531.1

EBITDA

107.7

57.2

32.7

–17.5

180.1

Depreciation and amortization

–44.1

–19.6

–21.8

–6.2

–91.7

EBIT

63.6

37.6

10.9

–23.7

88.4

Operating assets

530.1

459.1

305.9

43.5

1,338.6

Operating liabilities

171.6

100.4

49.9

42.5

364.4

ROS, gross (EBITDA/Net sales)

14.6 %

11.8 %

10.6 %

11.8 %

ROS, net (EBIT/Net sales)

8.6 %

7.7 %

3.5 %

5.8 %

ROA (EBIT/Operating assets)

12.0 %

8.2 %

3.6 %

6.6 %

Capital investments

22.6

10.4

10.9

1.3

45.2

Number of employees (at 31.12.)

2,611

1,377

1,684

43

5,715

Flooring
m CHF

Adhesivesm CHF

Beltingm CHF

Divested
activities
m CHF

Corporate andconsolidation
m CHF

Total
m CHF

Net sales

787.4

219.4

347.5

130.8

EBITDA

123.5

24.3

39.9

9.6

–17.9

179.4

Depreciation and amortization

–44.9

–7.7

–25.5

–6.4

–6.0

–90.5

3.2

By business segments 2001

1,485.1

EBIT

78.6

16.6

14.4

–23.9

88.9

Operating assets

567.9

131.2

339.0

49.9

1,088.0

Operating liabilities

186.4

44.3

53.8

31.1

315.6

ROS, gross (EBITDA/Net sales)15.7 %

11.1 %

11.5 %

12.1 %

ROS, net (EBIT/Net sales)

9.9 %

7.6 %

4.1 %

6.0 %

ROA (EBIT/Operating assets)

13.8 %

12.7 %

4.2 %

8.2 %

Capital investments

43.5

8.2

9.7

Number of employees (at 31.12.)

2,723

755

1,622

16 Forbo Financial Report 2002

2.2

2.8

66.4

45

5,145

By geographical segments 2002

Europe(Eurozone)
m CHF

Switzerland
m CHF

Rest ofEuropem CHF

Americas
m CHF

Asia/
Africa
m CHF

Total
m CHF

Net sales

680.4

66.9

309.5

346.2

128.1

1,531.1

Operating assets

713.4

138.4

199.2

222.3

65.3

1,338.6

Capital investments

27.5

4.1

5.1

6.4

2.1

45.2

Number of employees (at 31.12.)

3,065

413

1 ,057

815

365

5,715

Europe(Eurozone)
m CHF

Switzerland
m CHF

Rest ofEuropem CHF

Americas
m CHF

Asia/
Africa
m CHF

Total
m CHF

By geographical segments 2001
Net sales

774.8

86.9

297.0

200.7

125.7

1,485.1

Operating assets

567.7

151.5

192.1

94.3

82.4

1,088.0

Capital investments

46.9

8.0

7.2

2.6

1.7

66.4

Number of employees (at 31.12.)

2,881

457

970

490

347

5,145

Of which due
to exchange
rate changes
m CHF

Due to volume
an pricechangesm CHF

Changes inscope ofconsolidation
m CHF

–23.3

–28.0

0.0

Net sales are based on the country in which the customer is located.
Changes in net sales by businesses
2
2002

2001

Net sales
m CHF

m CHF

Total
changem CHF

Flooring (2001 excluding divested activities)

736.1

787.4

–51.3

Adhesives

486.6

219.4

267.2

–6.2

18.2

255.2

Belting

308.4

347.5

–39.1

–19.9

–19.2

0.0

Total

1,531.1

1,354.3

176.8

–49.4

–29.0

255.2

Development and production overhead costs
3

Development costs include product development as well as design activities and amounted
to CHF 24.2 million (2001: CHF 22.0 million). Production overhead costs totaled
CHF 159.7 million (2001: CHF 147.2 million) and are included in ‘Cost of goods sold’.
Administrative costs

4

This item consists of the usual expenses related to administrative activities. The Group has
no significant costs for license fees or royalties.

Forbo Financial Report 200217

Other operating expenses, net

2002

2001

m CHF

m CHF

5

Current costs and projects

0.0

2.1

Other expenses

19.9

18.7

Other income

–15.6

–14.5

4.3

6.3

Total other operating expenses, net

Other operating expenses and income include all costs and income which can not be clearly
allocated to the other categories.
Personnel expenses

2002

2001

6

Salaries and wages

m CHF

m CHF

329.9

323.2

Employer’s social security contributions

76.2

75.8

Total personnel expenses

406.1

399.0

The Group’s headcount at December 31, 2002 was 5,715 (2001: 5,145). This includes
728 employees of the acquired activities. The average headcount over the year was 5,508(2001: 5,656).
About 120 managers participate in a bonus plan, which is linked to the achievement offinancial targets by the Group as well as individually determined objectives. Up to 30 % of
the bonus payment consists of shares of Forbo Holding AG. The participants can disposeof these shares after a period of at least three years.
Call options are issued to the Board of Directors and the Group Executive Board within
the framework of a stock option plan. Until December 31, 2002 the following options were
granted:Exercise
priceYear alloted

NumberTerm

Frozen until

Subscription
ratio

2000

2015

10.04.01–09.05.05

09.05.03

1:1

670

2001

5297

08.05.01–07.05.06

07.05.04

1:1

741

2002

6942

07.05.02–07.05.07

06.05.05

1:1

518

CHF

No charge is made to personnel expenses in connection with share options.
For details please see Annual Report (general part, page 42: Compensation of governing
bodies).

18 Forbo Financial Report 2002

Financial income

2002

2001

7
m CHF

m CHF

Interest income

4.4

2.7

Dividend income

0.6

0.7

Total financial income

5.0

3.4

Financial expenses

2002

2001

m CHF

m CHF

Interest expense

27.5

17.9

Amortization of issuance costs of bonds and private placements

0.4

0.2

Foreign exchange losses, net

1.3

1.3

Total financial expenses

29.2

19.4

8

The average interest rate on interest-bearing debt (bonds, private placements, long- andshort-term bank loans) in 2002 was 4.5 % (2001: 4.7 %).
Earnings per share
9

Basic earnings per share is calculated by dividing net profit for the year by the weighted
average number of shares outstanding.

Net profit for the year (m CHF)
Weighted average number of shares outstanding
Basic earnings per share (net profit) (CHF)

2002

2001

42.6

51.8

1,305,619 1,368,948
32.65

37.84

Diluted earnings per share in addition takes into account the potential dilution effects
which would result if all share options were exercised.

Net profit for the year (m CHF)

2002

2001

42.6

51.8

Weighted average number of shares for diluted
earnings per share
Diluted earnings per share (net profit) (CHF)

1,317,559 1,373,823
32.35

37.70

Forbo Financial Report 2002

19

Tangible assets
10

The tangible assets also include leased assets with a net book value of CHF 2.5 million(2001: CHF 4.2 million) as well as non-operating property with a net book value of
CHF 15,8 million (2001: CHF 40,0 million). The net book value of the non-operating
property roughly equals its fair value.

Cost

Other
MachineryLand andbuildings and equipment tangible assets
m CHF
m CHF
m CHF

Total
Assets underconstruction tangible assets
m CHF
m CHF

At 31.12.2000, gross

499.6

750.5

155.1

90.6

1,495.8

Changes in scope of consolidation

–57.3

–76.8

–14.6

–1.9

–150.6

Additions

5.7

31.1

11.3

18.2

66.3

Disposals

–5.1

–12.9

–13.2

–1.6

–32.8

Transfers

15.1

45.3

7.8

–68.2

0.0

Translation differences

–11.5

–21.0

–4.5

–1.8

–38.8

At 31.12.2001, gross

446.5

716.2

141.9

35.3

1,339.9

Changes in scope of consolidation

69.1

122.5

14.1

3.5

209.2

Additions

3.0

21.4

15.1

5.1

44.6

Disposals

–18.5

–16.6

–8.5

–0.9

–44.5

Transfers

–2.9

15.5

2.6

–18.3

–3.1

Translation differences

–23.2

–41.0

–5.6

–1.5

–71.3

At 31.12.2002, gross

474.0

818.0

159.6

23.2

1,474.8

Accumulated depreciation

Land andMachinery
Otherbuildings and equipment tangible assets
m CHF
m CHF
m CHF

Assets under
Total
construction tangible assets
m CHF
m CHF

At 31.12.2000, gross

171.6

525.8

116.0

7.4

820.8

Depreciation

15.2

54.6

15.5

0.6

85.9

Impairments

0.0

8.5

0.0

0.0

8.5

Changes in scope of consolidation

–30.7

–57.7

–12.2

0.0

–100.6

Disposals

–0.8

–14.3

–13.0

0.0

–28.1

Transfers

–0.7

7.2

0.6

–7.1

0.0

Translation differences

–4.1

–15.2

–3.3

–0.1

–22.7

At 31.12.2001, gross

150.5

508.9

103.6

0.8

763.8

Depreciation

15.8

50.2

14.3

0.2

80.5

Changes in scope of consolidation

25.6

76.9

9.3

0.0

111.8

Disposals

–5.6

–15.3

–7.4

–0.2

–28.5

Transfers

0.1

0.4

–0.3

–0.4

–0.2

Translation differences

–7.9

–27.5

–3.9

–0.2

–39.5

At 31.12.2002, gross

178.5

593.6

115.6

0.2

887.9

Total tangible assets at 31.12.2001, net

296.0

207.3

38.3

34.5

576.1

Total tangible assets at 31.12.2002, net

295.5

224.4

44.0

23.0

586.9

The fire insurance value of buildings, machinery and factory equipment of CHF 1,969 million (2001: CHF 1,842 million) covers the replacement cost. The business interruption
risk arising from fire and the production and product liability risks are covered by a groupwide policy.
Maintenance and repair costs amounted to CHF 29.9 million (2001: CHF 28.4 million).
The depreciation expense is included in ‘Cost of goods sold’, ‘Development costs’, ‘Marketingand distribution costs’ and ‘Administrative costs’.

20 Forbo Financial Report 2002

Intangible assets
11

Cost
Goodwillm CHF

Trademarks/
patents
m CHF

Other
intangible
assets
m CHF

Total
m CHF

At 31.12.2000, gross

21.6

29.0

0.6

51.2

Changes in scope of consolidation

7.9

0.1

0.0

8.0

Additions

0.0

0.0

0.1

0.1

Translation differences

0.3

0.0

0.0

0.3

At 31.12.2001, gross

29.8

29.1

0.7

59.6

Changes in scope of consolidation

149.4

25.0

2.1

176.5

Additions

0.0

0.0

0.6

0.6

Disposals

–0.2

0.0

0.0

–0.2

Transfers

0.0

0.0

3.1

3.1

Translation differences

–14.9

0.0

–0.1

–15.0

At 31.12.2002, gross

164.1

54.1

6.4

224.6

Goodwillm CHF

Trademarks/
patents
m CHF

Other
intangible
assets
m CHF

Total
m CHF

At 31.12.2000, gross

12.0

19.5

0.3

31.8

Amortization

1.5

2.9

0.1

4.5

Accumulated amortization

Translation differences

0.0

0.1

0.0

0.1

At 31.12.2001, gross

13.5

22.5

0.4

36.4

Amortization

6.7

3.8

0.7

11.2

Transfers

0.0

0.0

0.2

0.2

Translation differences

–1.9

0.0

0.1

–1.8

At 31.12.2002, gross

18.3

26.3

1.4

46.0

Total intangible assets at 31.12.2001, net

16.3

6.6

0.3

23.2

Total intangible assets at 31.12.2002, net

145.8

27.8

5.0

178.6

2002

2001

m CHF

m CHF

4.1

4.8

Investments in associates and other long-term assets
12

Investments in associated companies
Other investments

2.9

2.4

Loans to associated companies

19.0

19.0

Other long-term receivables

18.0

18.2

Total investments in associates and other long-term assets

44.0

44.4

As of October 1, 2001 the Carpet Business was sold to its management. Forbo has granted
a loan of CHF 19.0 million to the newly created group and holds a 25 % investment in Enia
Carpet Group AG, Ennenda/Switzerland, the parent company of the group. The valuationof the investment is based on the equity method and resulted in a decrease of CHF 0.7 million. (See also page 30, transactions with related parties.)

Forbo Financial Report 2002

21

Inventories

2002

m CHF

m CHF

Raw materials and supplies

66.0

47.4

Work in progress

70.0

80.1

2001

13

Finished goods

131.2

111.3

Allowance for product risks

–11.3

–11.8

Total inventories

255.9

227.0

Trade receivables

2002

2001

m CHF

m CHF

Accounts receivable

252.3

196.5

14

Notes receivable

22.6

26.7

Allowance for doubtful receivables

–20.1

–20.6

Total trade receivables

254.8

202.6

Marketable securities
15

Marketable securities at December 31, 2002 and December 31, 2001 consist entirely ofshares; primarily shares included in the SPI (Swiss Performance Index). They have beenclassified as available-for-sale.
Share capital

16

The share capital of Forbo Holding AG amounts to CHF 67,828,800 and is divided into
1,356,576 registered shares with a nominal value of CHF 50 each. Of these, 25,880 registered shares without voting and dividend rights are at the disposition of the Board of
Directors. In the context of a share buy-back program, 156,974 registered shares wererepurchased in 2001 and eliminated in 2002. Consequently, 1,330,696 registered sharescarry dividend rights for the 2002 financial year. Changes in shares outstanding were as
follows:
1. 1. 2002

Change31.12.2002

NumberNumberNumberChanges in shares outstanding
Total shares

1,513,550 –156,974 1,356,576

Treasury shares
Shares with dividend right

11,39014,09925,489

Shares without dividend right

40,134–14,254

25,880Share buy-back 2001

156,974 –156,974–

Total treasury shares

208,498 –157,129

51,369Total shares outstanding

22 Forbo Financial Report 2002

1,305,052

155 1,305,207

Long-term financial debt

2001

2002

17
m CHF

m CHF

Outstanding bonds

150.0

150.0

Outstanding private placements

382.3

0.0

Unamortized issuance cost

–5.4

–1.6

Total outstanding bonds and private placements

526.9

148.4

Unsecured bank loans

6.9

90.2

Secured bank loans*

11.0

20.2

Lease obligations

2.2

2.8

Less current portion

–7.7

–97.1

Total long-term financial debt

539.3

164.5

0.0

7.2

* of which loans without fixed maturity date secured by property

Secured bank loans are covered by property of the Group (book value CHF 41.4 million).
2002

2001

Maturities of long-term financial debt
m CHF

m CHF

after 1 year

1.6

1.7

after 2 years

1.5

1.6

after 3 years

151.4

1.5

after 4 years

144.6

151.5

after 5 and more years

245.6

9.8

Unamortized issuance cost of bonds and private placements

–5.4

–1.6

Total

539.3

164.5

The issuance costs of bonds and private placements are amortized over the respective
terms.
Outstanding bonds and private placements at 31.12.2002
Company

Currencym

Term

Interest rate

Forbo Holding AG

CHF

150.0

2001–2006

4.125 %

Forbo NL Holding B.V. (guaranteed by Forbo Holding AG)

USD

103.0

2002–2007

5.120 %

Forbo NL Holding B.V. (guaranteed by Forbo Holding AG)

USD

122.0

2002–2009

5.790 %

Forbo NL Holding B.V. (guaranteed by Forbo Holding AG)

USD

50.0

2002–2012

6.290 %The bonds and private placements have no early redemption clause.

Forbo Financial Report 2002

23

Employee benefit obligations
18

The Group has established several pension plans on the basis of the specific requirementsof the countries in which the Group has such plans. The Group has both defined contribution and defined benefit plans. The employee benefit obligations of the Swiss Group
companies are insured by insurance contracts. These insured benefits have been treatedas a defined contribution plan as the Group does not retain any obligations further to thepayment of the insurance premiums.
The expense for contributions to defined contribution plans, which is included in personnel expenses, amounted to CHF 8.1 million (2001: CHF 8.4 million). Details of the pension expense related to the major defined benefit plans are as follows:
2001

2002

m CHF

m CHF

Current service cost

11.5

11.0

Interest on obligation

26.9

26.2

Expected return on plan assets

–28.3

–32.0

Effect of partial settlements

0.0

–3.8

Recognised actuarial losses (+) and gains (–)

0.1

–0.1

Net periodic pension cost

10.2

1.3

Change of unrecognized assets

0.5

–1.7

Translation differences on unrecognized assets

3.2

1.4

Total pension expenses

13.9

1.0

(limit under IAS 19 para. 58b)

The actual return on plan assets was CHF –42.0 million (2001: CHF –39.8 million).
The amounts recognized in the balance sheet are as follows:
2001

2002

m CHF

m CHF

Present value of obligations

475.5

467.2

Fair value of plan assets–397.8–453.0

Unrecognised actuarial losses–102.8–39.4

Unrecognised assets (limit under IAS 19 para. 58b)

63.6

63.1

Net liability in the balance sheet

38.5

37.9

The employee benefit obligations of CHF 68.9 million (2001: CHF 69.8 million) also
include provisions for early retirement and other benefits of about CHF 30 million.

24 Forbo Financial Report 2002

Movements in the net liability recognized in the balance sheet are as follows:
2002

2001

m CHF

m CHF

Net liability at the beginning of the year

37.9

54.0

Total pension expenses as included in personnel expenses

13.9

1.0

Employer contributions

–14.9

–6.6

Changes in scope of consolidation

2.8

–7.8

Translation differences

–1.2

–2.7

Net liability at the end of the year

38.5

37.9

The principal actuarial assumptions used for accounting purposes were (expressed asweighted averages):
2001

2002

%

%

Discount rate

5.4

5.5

Expected return on plan assets

6.3

6.3

Future salary increases

3.1

3.4

Provisions
19

Warranty
provisions
m CHF

Restructuringprovisions
m CHF

Other
provisions
m CHF

Total
provisions
m CHF

At 31.12.2001

7.0

0.0

9.4

16.4

Changes in scope of consolidation

0.0

14.3

6.3

20.6

Charges to the income statement

1.3

0.0

1.7

3.0

Utilized during the year

–1.2

–7.3

–5.5

–14.0

Transfers

0.0

0.0

–3.1

–3.1

Translation differences

–0.1

0.0

–0.2

–0.3

At 31.12.2002

7.0

7.0

8.6

22.6

Warranty provisions are made in connection with the sale of products and are basedon past experience. The restructuring provisions relate to the acquisitions made during theyear. The transfers reflect reclassifications to accrued expenses.

Trade payables

2002

m CHF

m CHF

Accounts payable

100.5

72.7

2001

20

Notes payable
Total trade payables

6.8

6.7

107.3

79.4

Forbo Financial Report 2002

25

Accrued expenses

2002

m CHF

m CHF

Current taxes

14.0

14.1

Accrued personnel expenses

24.9

19.4

2001

21

Other accruals

77.8

61.5

Total accrued expenses

116.7

95.0

Other accruals comprise accrued volume rebates, commissions, premiums, interest andaccrued warranty cost and similar items.
Short-term financial debt

2002

m CHF

m CHF

Short-term bank loans and overdrafts

90.8

100.1

plus current portion of long-term debt

7.7

97.1

Total short-term financial debt

98.5

197.2

Commitments and contingent liabilities

2002

2001

m CHF

m CHF

0.9

2.2

2001

22

23

Commitments and contingent liabilities

Contingent liabilities relate to sureties and guarantees in favor of third parties. The effects
on the Group’s earnings of changes in legal, fiscal and political conditions are notpredictable and therefore not quantifiable. There are no significant lawsuits pending.
Income taxes

2002

m CHF

m CHF

Current taxes

16.9

31.8

Deferred taxes

4.0

–10.7

Total income taxes

20.9

21.1

2001

24

Current taxes represent amounts paid or payable to tax authorities based on the current
year’s income as determined by the rules and regulations applicable in each country.
Forbo Holding AG is resident in Switzerland, but the Group carries out most of its commercial activities in countries with differing tax regulations and tax rates. A significant
portion of the income before taxes of the Group is generated outside Switzerland. Thus
the effective tax rate and tax provisions change each year, according to the geographicaldistribution of the taxable income. The income taxes for 2002 of CHF 20.9 million (2001:
CHF 21.1 million) on the Group’s pre-tax profit of CHF 63.5 million (2001: CHF 72.9
million) differ from the theoretical amount that would arise using the maximum tax rateof Eglisau/Zurich, Switzerland of 25 % as follows:

26 Forbo Financial Report 2002

2002

2001

m CHF

m CHF

Tax at the applicable tax rate of 25 % for Eglisau/Zurich, Switzerland

15.7

18.4

Effect of different tax rates in other countries

5.2

2.7

Total income taxes (effective)

20.9

21.1

The tax loss carry forwards of the Group amount to about CHF 184 million. Tax loss carryforwards totaling CHF 43 million will expire within the next ten years if they are not used.
The remaining amount of CHF 141 million has no expiry date.
Deferred income tax assets and liabilities are offset when they relate to the same fiscal
authority. The following amounts are shown in the balance sheet:
2002

2001

m CHF

m CHF

Deferred tax assets

65.6

72.7

Deferred tax liabilities

–7.8

–2.1

Deferred tax assets, net

57.8

70.6

Deferred tax assets and liabilities and deferred tax charges and credits are attributable tothe following items:
Deferred tax assets
Inventories
m CHF

Tangible
assetsm CHF

Provisions
m CHF

Tax losscarry forwards
m CHF

Other
m CHF

Total
m CHF

9.9

2.0

5.3

63.4

2.2

82.8

–0.6

–0.4

–0.6

–2.9

0.9

–3.6

Changes in scope of consolidation

0.3

0.6

0.2

0.0

0.0

1.1

Translation differences

–0.5

0.0

–0.1

–5.1

–0.2

–5.9

At 31.12.2002

9.1

2.2

4.8

55.4

2.9

74.4

Inventories
m CHF

Tangible
assetsm CHF

Provisions
m CHF

Tax losscarry forwards
m CHF

Other
m CHF

Total
m CHF

–4.3

–5.4

–1.6

0.0

–0.9

–12.2

0.1

–0.4

1.4

0.0

–1.5

–0.4

Changes in scope of consolidation

0.0

–4.3

0.0

0.0

0.0

–4.3

Translation differences

0.1

0.0

0.2

0.0

0.0

0.3

At 31.12.2002

–4.1

–10.1

0.0

0.0

–2.4

–16.6

Deferred tax assets at 31.12.2001, net

5.6

–3.4

3.7

63.4

1.3

70.6

Deferred tax assets at 31.12.2002, net

5.0

–7.9

4.8

55.4

0.5

57.8

At 31.12.2001
Credited (+), charged (–)
to the income statement

Deferred tax liabilities
At 31.12.2001
Credited (+), charged (–)
to the income statement

Forbo Financial Report 2002

27

Statement of added value

2002

2001

25
m CHF

m CHF

Gross added value

585.5

578.3

Depreciation and amortization expense

–91.7

–90.4

Net added value

493.8

487.9

Employees

406.1

399.0

Public sector

20.9

21.1

Creditors

24.2

16.0

Investors

29.0

32.4

Retained in the Group

13.6

19.4

Distribution of added value

Total

493.8

487.9

Net added value per employee (CHF)

89,651

86,262

Translation of foreign currencies
26
2002

Currency

2001

2002

Income statement (average rates for the year)

CHF

CHF

Change%2001
Balance sheet (year-end rates)

CHF

CHF

Change%–1Euro countries

EUR

1

1.47

1.51

–3

1.46

1.48

Sweden

SEK

100

16.01

16.35

–2

15.83

15.83

–

United Kingdom

GBP

1

2.33

2.43

–4

2.23

2.43

–8

USA

USD

1

1.56

1.69

–8

1.39

1.68

–17

Canada

CAD

1

0.99

1.09

–9

0.88

1.05

–16

Japan

JPY

100

1.24

1.39

–11

1.17

1.28

–9

Financial Risk Management27

In its international operations and financial activities the Forbo Group is exposed tovarious types of financial risks. In order to steer potential risks and benefits arising fromfluctuations in both exchange rates of foreign currencies and interest rates the Group
selectively uses derivative instruments. The various risks involved in existing assets and liabilities, planned transactions and expected transactions are monitored and managed
centrally – taking into account the consolidated risk exposure of the Group. In adherence
to the Group’s financial risk management policy (established through the issuance of
written guidelines and policies) Corporate Treasury continuously monitors both the risk
exposure and the effectiveness of the applied hedging instruments. Also, Corporate
Treasury advises the Finance Managers of the Group companies on the management ofidentified risks and recommends both the extent of a potential hedge transaction andthe appropriate type of financial instrument. The Group’s financial risk management policy allows the use of derivate instruments neither for trading nor for speculation. The
counterparties of derivate transactions are cautiously selected and thus hedging transactions are concluded with strong financial institutions only, based on the assessmentsof the leading rating agencies.
All concluded derivative instruments are related to either management of currency risks
or management of interest rate risks (or a combination of both).

28 Forbo Financial Report 2002

Management of currency risks

Risks arising from short-term currency exposures created by purchases and sales of goods
and services (transaction risks) are identified and selective hedging strategies are implemented in the light of an ongoing assessment of exchange rate movements. As a rule, theGroup uses forward and option contracts with maturities of up to twelve months only.
These hedging transactions resulted in the following open positions at December 31, 2002:
Financial derivatives
Instrument

Forward contracts

Numberof contracts

Gross value
hedged31.12.2002
m CHF

Unrealized
gain/loss
31.12.2002
m CHF

12

4.0

0.0

In accordance with IAS 39 the above instruments are recognized in the balance sheet atfair value at December 31, 2002. The accumulated fair value (total of all negative and positive market values) at December 31, 2002 amounts to CHF 0.0 million (CHF –0.1 million
at December 31, 2001).
Furthermore, risks associated with the conversion of assets and liabilities denominated inforeign currencies (translation risks) are taken into account by establishing an appropriate
financing structure.
Management of interest rate risks

The market values of interest-bearing assets and liabilities are subject to fluctuations ofinterest rates. The Group makes use of financial derivatives in order to steer potential risks
and benefits arising from interest rate movements and in order to manage the durationof the interest rate fixings. As a rule, the Group uses interest rate swaps and cross-currencyinterest rate swaps with maturities of up to seven years only. These hedging transactions
resulted in the following open positions at December 31, 2002:
Financial derivatives
Instrument

Interest rate swaps and cross-currency interest rate swaps

Numberof contracts

Gross value
hedged31.12.2002
m CHF

Unrealized
gain/loss
31.12.2002
m CHF

17

384.7

–15.3

In accordance with IAS 39 the above instruments are recognized in the balance sheet at fairvalue at December 31, 2002. The accumulated fair value (total of all negative and positivemarket values) at December 31, 2002 amounts to CHF –15.3 million (CHF –3.2 million at
December 31, 2001).

Forbo Financial Report 2002

29

Acquisitions
28

Changes in the scope of consolidation are set out on page 14. Details of acquired assets andliabilities as well as the cash used for acquisitions are as follows:
2002

m CHF

Tangible assets

97.4

Inventories

40.1

Receivables and other current assets

80.4

Cash and cash equivalents

4.0

Employee benefit obligations–2.8

Provisions–13.2

Deferred tax liabilities, net–3.2

Trade payables and other liabilities–38.6

Fair value of acquired net assets (excluding intangible assets)

164.1

Goodwill

149.4

Trademarks/patents

25.0

Other intangible assets

2.1

Subtotal

340.6

Less acquired cash

–4.0

Less already owned 25 % investment in Stephens Miraclo Extremultus Ltd.

–0.8

Total cash used for acquisitions

335.8

Net sales of the acquired companies since the acquisition amounted to CHF 255.2 million.
Operating profit before depreciation and amortization (EBITDA) was CHF 29.1 million.
Related party transactions
29

The Group owns 25 % of Enia Carpet Group and granted a loan of CHF 19.0 million (seepage 21, Investments in associates and other long-term assets). The interest rate is
4.5 % and interest income amounted to CHF 0.9 million (2001: CHF 0.1 million). In 2002
the Group purchased products for CHF 7.1 million from Enia Carpet Group, whereas
Enia Carpet Group purchased products for CHF 5.1 million from Forbo Group. Thesesales occurred at arms’ length.
Events after balance sheet date

30

With effect January 1, 2003 Repoxit AG, Winterthur/Switzerland was sold to the management of the company. In 2002 the company achieved net sales of CHF 16 million with
68 employees.

30 Forbo Financial Report 2002

Report of the Group Auditors

Report of the Group Auditors
to the General Meetingof Forbo Holding AG, Eglisau

As auditors of the Group, we have audited the consolidated financial statements (consolidated income statement, consolidated balance sheet, consolidated cash flow statement,
consolidated statement of changes in shareholders’ equity and notes to the consolidated financial statements) on pages 7 to 30 of Forbo Holding AG for the year ended
December 31, 2002.
These consolidated financial statements are the responsibility of the board of directors.
Our responsibility is to express an opinion on these consolidated financial statements
based on our audit. We confirm that we meet the legal requirements concerning professional qualification and independence.
Our audit was conducted in accordance with auditing standards promulgated by the Swiss
profession and with the International Standards on Auditing, which require that an audit
be planned and performed to obtain reasonable assurance about whether the consolidated
financial statements are free from material misstatement. We have examined on a test
basis evidence supporting the amounts and disclosures in the consolidated financial statements. We have also assessed the accounting principles used, significant estimates madeand the overall consolidated financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements give a true and fair view of thefinancial position, the results of operations and the cash flows in accordance with theInternational Financial Reporting Standards (IFRS) and comply with Swiss law.
We recommend that the consolidated financial statements submitted to you be approved.
PricewaterhouseCoopers AG

S. Räbsamen

L. Monn

Zurich, March 6, 2003

Forbo Financial Report 200231

Consolidated income statements 1998–2002
2002

2001

2000

1999

1998

m CHF

m CHF

m CHF

m CHF

m CHF

Net sales

1,531.1

1,485.1

1,776.8

1,754.5

1,714.5

Cost of goods sold–1,017.4–962.7–1,143.2–1,125.1–1,092.3

Gross profit

513.7

522.4

633.6

629.4

622.2

Development costs

–24.2

–22.0

–29.8

–30.2

–31.2

Marketing and distribution costs–277.2–288.6–333.6–335.2–333.0Administrative costs–119.6–116.6–129.8–122.3–120.0

Other operating expenses, net

–4.3

–6.3

–9.8

–18.7

–25.8

Operating profit before specific provisions

88.4

88.9

130.6

123.0

112.2

–70.0

Specific provisions
Operating profit after specific provisions

88.4

88.9

130.6

53.0

112.2

Financial income

5.0

3.4

16.8

13.8

12.8

Financial expenses

–29.2

–19.4

–21.3

–19.4

–20.6

Share of results of associated companies–0.7

Profit before taxes

63.5

72.9

126.1

47.4

104.4

Taxes

–20.9

–21.1

–35.4

–31.3

–27.7

Net profit for the year

42.6

51.8

90.7

16.1

76.7

32 Forbo Financial Report 2002

Consolidated balance sheets 1998–2002
2002

2001

2000

1999

1998

Assets
m CHF

m CHF

m CHF

m CHF

m CHF

Long-term assets

875.1

716.4

778.9

866.9

828.9

Tangible assets

586.9

576.1

675.0

813.1

781.3

Intangible assets

178.6

23.2

19.4

24.0

20.3

Deferred taxes

65.6

72.7

65.1

27.3

24.8

Investments in associates and other
44.0

44.4

19.4

2.5

2.5

Current assets

725.5

615.2

747.7

860.5

751.4

Inventories

255.9

227.0

260.7

306.2

291.4

Trade receivables

254.8

202.6

243.4

282.1

247.1

Other receivables

27.0

30.1

41.3

31.1

33.4

Prepaid expenses and deferred charges

35.4

29.0

19.2

19.6

18.9

Marketable securities

23.9

33.8

45.5

73.6

71.6

long-term assets

Cash and cash equivalents
Total assets

128.5

92.7

137.6

147.9

89.0

1,600.6

1,331.6

1,526.6

1,727.4

1,580.3

2002

2001

2000

1999

1998

Shareholders’ equity and liabilities
m CHF

m CHF

m CHF

m CHF

m CHF

Shareholders’ equity

590.6

652.2

813.9

794.8

798.3

Share capital

67.8

75.7

75.7

75.7

75.7

Treasury shares–11.7–155.2

–8.2

–2.0

–2.0

Reserves and retained earnings

534.5

731.7

746.4

721.1

724.6

Long-term liabilities

638.6

252.8

275.2

458.6

372.5

Long-term financial debt

539.3

164.5

145.1

247.3

251.7

Employee benefit obligations

68.9

69.8

88.0

91.8

67.1

Provisions

22.6

16.4

39.2

115.5

48.5

Deferred taxes

7.8

2.1

2.9

4.0

5.2

Current liabilities

371.4

426.6

437.5

474.0

409.5

Trade payables

107.3

79.4

90.2

139.6

120.5

Accrued expenses

116.7

95.0

104.7

105.0

93.4

Short-term financial debt

98.5

197.2

194.7

179.3

153.6

Other current liabilities

48.9

55.0

47.9

50.1

42.0

1,600.6

1,331.6

1,526.6

1,727.4

1,580.3

Total shareholders’ equity and liabilities

Forbo Financial Report 2002

33

Financial statements of Forbo Holding AG

Forbo Financial Report 2002

35

Income statement of Forbo Holding AG
2002

2001

Notes

CHF

CHF

from investments in and advances to Group companies

1

161,083,326

64,737,770

from securities and short-term investments

2

992,326

258,098

IncomeIncomeIncome from services and other sources
Total income

677,191

7,008

162,752,843

65,002,876

2002

2001

Expenses
Notes

CHF

CHF

Administrative expenses

3

3,206,921

4,834,583

Financial expenses

4

11,080,638

5,432,771

349,876

394,650

Taxes
Valuation adjustments

117,769,878

24,121,064

Total expenses

132,407,313

34,783,068

Net profit for the year

30,345,530

30,219,808

36 Forbo Financial Report 2002

5

Balance sheet of Forbo Holding AG(before appropriation of available earnings)
31. 12. 2002

31. 12. 2001

Assets
Notes

Long-term assets

CHF

CHF

437,285,710

390,695,850
306,013,834

Investments in Group companies

6

265,126,811

Advances to Group companies

7

172,158,899

84,682,016

Own shares (from share buy-back program 2001)

8

0

146,673,690

45,069,972

85,289,489

830,639

1,899,379

1,242,255

1,860,637

Current assets
Other receivables from Group companies
Other receivables from third parties
Prepaid expenses and deferred charges

9

1,278,769

1,597,333

Marketable securities

10

24,167,536

33,581,555

Cash

11

17,550,773

46,350,585

482,355,682

622,659,029

31. 12. 2002

31. 12. 2001

Total assets

Shareholders’ equity and liabilities
Notes

Shareholders’ equity
Share capital

12/13

CHF

CHF

300,055,067

439,947,414

67,828,800

75,677,500

Statutory reserves:
General reserves

15,600,000

15,600,000

14

13,866,720

155,238,428

15

140,071,743

132,127,488

Profit carried forward

32,342,274

31,084,190

Net profit for the year

30,345,530

30,219,808

182,300,615

182,711,615

Reserve for own shares
Other reserves
Available earnings:

Liabilities
Long-term provisions

16

28,000,000

28,000,000

Bond issues

17

150,000,000

150,000,000

Other current liabilities to third parties
Accrued expenses
Total shareholders’ equity and liabilities

51,09868,911

4,249,517

4,642,704

482,355,682

622,659,029

Forbo Financial Report 2002

37

Notes to the financial statementsof Forbo Holding AG
Income from investments in and advances to Group companies
1

Income from investments in and advances to Group companies amount to CHF 161.1 million (previous year: CHF 64.7 million) and consist of interest and dividend income. The
amount includes a special distribution from Forbo America Inc. of CHF 111.6 million in
the context of a group internal refinancing.
Income from securities and short-term investments

2This item includes income from short-term investments of CHF 0.4 million (previous
year: CHF 1.8 million) as well as realized gains from securities of CHF 0.6 million (previous year: realized losses of CHF 1.5 million).
Administrative expenses

3

Administrative expenses amount to CHF 3.2 million. This is CHF 1.6 million less thanin the previous year which included nonrecurring costs in connection with the share buyback.
Financial expenses

4

Financial expenses of CHF 11.1 million relate to the 4 1/8 % bond issue 2001–2006 of CHF
150.0 million and the amortization of capitalized issuance costs. Furthermore, interest
expenses arose in connection with the bridge financing of the acquisition of the Swift adhesives activities.
Valuation adjustments

5

Increased valuation adjustments of CHF 117.8 million (previous year: CHF 24.1 million)
relate mainly to investments in and loans to Group companies and take into accountthe uncertainty of economic and currency trends. In addition, they include unrealized valuation losses (net) on securities and exchange losses on foreign currency items.
Investments in Group companies

6

See list of Group companies on pages 44–46. The net decrease compared to the previous
year amounts to CHF 40.9 million and is mainly attributable to valuation adjustments.
Furthermore, an additional capital injection was made to Forbo Beteiligungen GmbH. In
addition, Forbo Linoleum BV was transferred at book value to Forbo Finanz AG.
Advances to Group companies

7

Advances to Group companies are denominated in Swiss Francs and foreign currencies.
There was a CHF 87.5 million increase over the previous year’s figure.
Own shares (from share buy-back program 2001)

8

In the context of the share buy-back program of the previous year, 156,974 registeredshares were repurchased for CHF 146.7 million. In accordance with the resolution of theAnnual General Meeting of Shareholders 2002 these shares have been eliminated andthe share capital has been reduced accordingly.
Prepaid expenses and deferred charges

9

Prepaid expenses and deferred charges include, besides the usual items, capitalized
costs of CHF 1.2 million incurred in connection with the issuance of the 4 1/8 % bond issue
2001–2006 which are amortized over 5 years.

38 Forbo Financial Report 2002

Marketable securities
10

Marketable securities include marketable bonds and shares, which are valued at market
value.
Cash

11

This item consists of cash and cash equivalents with original maturities of three months
or less.
Share capital12

At the end of 2002 the Company’s share capital amounts to CHF 67,828,800 and is divided
into 1,356,576 registered shares with a nominal value of CHF 50 each. In the context ofthe share buy-back program 156,974 shares have been eliminated. In the year under review
the Board of Directors put 14,254 reserve shares into circulation (out of a total of 40,134)and deposited them to secure the Stock Option Plan for the Board of Directors and the
Executive Board. Thus, 25,880 shares without voting and dividend rights are still at thedisposition of the Board of Directors. Accordingly, 1,330,696 registered shares carry dividend rights for the 2002 financial year. The shares are listed on the SWX Swiss Exchange.
Conditional capital increase13

CHF 8,500,000 of conditional capital reserved for the exercise of shareholder options andwarrants in connection with a with-warrants bond issue was created by resolution of theAnnual General Meeting of Shareholders held on April 27, 1994. Following the exercise of
options and warrants in 1994, 1995 and 1997 the conditional capital at December 31, 2002
was unchanged on the previous year-end total at CHF 8,322,500.
Reserve for own shares
14

The CHF 13.9 million included at year end under ‘Reserve for own shares’ refer to own
shares held by Forbo Holding AG and its subsidiaries valued at cost. Details of own sharesare as follows:

Own shares

CHF

No. of registeredshares nom.
value CHF 50

Total at 1.1.2002

155,238,428

208,498

Changes: due to share buy-back program 2001

–146,673,690–156,974

Cost

additions

690,862

1,500

disposals–840,392–1,655

additional paid-in capital of reserve shares
put in circulation *Total at 31.12.2002*

5,451,512
13,866,720

51,36914,254 registered shares deposited (see 12 Share capital)

Forbo Financial Report 2002

39

Other reserves
15

Other reserves showed a year-on-year increase of CHF 7.9 million, attributable to a transferfrom ‘Reserve for own shares’.
Long-term provisions

16

The CHF 28.0 million stated under this heading serve as a precautionary provision against
general risks.
Bond issues

17

The 4 1/8 % bond issue 2001–2006 of CHF 150.0 million is due for redemption on
June 8, 2006.
Contingent liabilities

18

Guarantees and letters of support issued to third parties in favor of Group companies
amount to CHF 439.3 million at year end, of which CHF 387.2 million (previous year
CHF 0.0 million) are utilized. Most of this relates to guarantees to investors in connection
with funds raised by a Group company in the form of a US private placement (CHF
382.3 million).

40 Forbo Financial Report 2002

Proposal for appropriation of available earnings
Forbo Holding AG
The Board of Directors proposes to the Annual General Meeting of Shareholders that theavailable earnings, consisting of:
2002

2001

CHF

CHF

Net profit for the year

30,345,530

30,219,808

Profit carried forward from the previous year

32,342,274

31,084,190

Total available earnings

62,687,804

61,303,998

2002

2001

be appropriated as follows:
Dividends on shares with dividend right:
2001: 1,316,442 shares at CHF 22.00

CHF

CHF

–

28,961,724

To be carried forward to the following year

62,687,804

32,342,274

Total

62,687,804

61,303,998

Instead of a dividend, a nominal value repayment of CHF 22.00 per share is proposed.

Forbo Financial Report 2002

41

Report of the Statutory Auditors

Report of the Statutory Auditors
to the General Meetingof Forbo Holding AG, Eglisau

As statutory auditors, we have audited the accounting records and the financial statements (income statement, balance sheet and notes) on pages 36 to 40 of Forbo Holding AG
for the year ended December 31, 2002.
These financial statements are the responsibility of the board of directors. Our responsibility is to express an opinion on these financial statements based on our audit. We confirm
that we meet the legal requirements concerning professional qualifications and independence.
Our audit was conducted in accordance with auditing standards promulgated by the Swiss
profession, which require that an audit be planned and performed to obtain reasonableassurance about whether the financial statements are free from material misstatement. We
have examined on a test basis evidence supporting the amounts and disclosures in thefinancial statements. We have also assessed the accounting principles used, significant estimates made and the overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the accounting records, the financial statements and the proposed
appropriation of available earnings comply with Swiss law and the company’s articles ofincorporation.
We recommend that the financial statements submitted to you be approved.
PricewaterhouseCoopers AG

S. Räbsamen
Zurich, March 6, 2003

42 Forbo Financial Report 2002

L. Monn

Company

Registered office

General management

Forbo Floorcoverings PTY. Ltd.

Chester Hill N.S.W.

Derek F. Byrne

AUD

1,400,000

100% S

Siegling Australia PTY. Ltd.

Auburn N.S.W.

Simon Coates

AUD

1,000,000

100%

Forbo Contel Handelsges.m.b.H.

ViennaFranz Kahr

EUR

73,000100% S

Forbo Industrieprodukte Ges.m.b.H.

Steyr/St. Ulrich

Walter A. Schmid

EUR

73,000100%

Siegling Austria Ges.m.b.H.

ViennaErich Knoll

EUR

327,000

100%

Balco Chemie Benelux BVBA

DendermondeToon Burghouts

EUR

20,000100%

N.V. Forbo Linoleum S.A.

Groot-Bijgaarden

Lieven Messiaen

EUR

250,000

100% S

Forbo Linoleum Ltda.

Itapevi-SP

Walter Gianfaldoni

BRL

10,000100% S

Siegling Brasil Ltda.

Itapevi-SP

Raul E. A. Gollmann

BRL

306,000

Holding/Services

Belting

Adhesives

Flooring

Equity interest in %Group companies(December 31, 2002)
Share capital

Australia
D

S

Austria
S
S

BelgiumS

BrazilN

MS

50%

CanadaForbo Adhesives (Canada) Ltd.

St. John

Jack L. Chambers

CAD

3,500,157

100%

Forbo Linoleum Inc.

TorontoDenis P. Darragh

CAD

500,000

100% S

Siegling Canada Ltd.

TorontoRick Zingel

CAD

501,000

100%

Brno

Tomás Kudera

CZK

500,000

100% S

Forbo Linoleum A/S

Glostrup

Jens-Christian Holm Iversen

DKK

500,000

100% S

Siegling Danmark A/S

BrøndbyRoger Olsson

DKK

1,000,000

MS

S

Czech Republic
Forbo s.r.o.
DenmarkS
MS

100%

Finland
Forbo Flooring AB Finland

HelsinkiAnne Takala

EUR

34,000100% SOy Forbo Swift AB

Espoo

Jukka Koskinen

EUR

25,253

100%

MS

Forbo Helmitin SAS

Surbourg

Francis Bischwiller

MS

Forbo Participations SAS

Surbourg

Francis Bischwiller

Forbo Sarlino SAS

Reims

Forbo Swift Adhesives SA
Heitz Alsacol Indus SA
Siegling France SAS

Lomme

FranceEUR

3,050,000

100%

EUR

11,524,800

100%

Alain Réquillart

EUR

6,400,000

Blois

Christian Barreau

EUR

800,000

100%

MS

Blois

Christian Barreau

EUR

344,000

100%

S

D

Egbert J. van Heerikhuizen

EUR

825,000

Sté. de Production de Sols Textiles-P.S.T. Reims

Dominique CarpentierEUR

3,092,000

100% MS

Sté. de Production de Sols Vinyles-P.S.V.

Alain Réquillart

EUR

3,447,000

100% MS

Reims

H

100% S

S

100%

Germany
Forbo Beteiligungen GmbH

Waldshut-Tiengen

Gerold A. Zenger

Forbo Erfurt GmbH

ErfurtRüdiger Beez

D

EUR

15,400,000

100%

EUR

2,050,000

100%

MS

100%

MS

Forbo Helmitin GmbH

Pirmasens

Dietmar Meyer

EUR

5,120,000

Forbo Linoleum GmbH

Paderborn

Karl-Heinz Gerlitz

EUR

500,000

100% S

EUR

1,030,000

100% S

EUR

1,023,000

100%

100,000

100%

Forbo Novilon GmbH

Frankfurt on the Main Hans-Heinrich Kuhn

Paul Heinicke GmbH & Co KG

Pirmasens

Peter Kraft

Realbelt GmbH

Velen

Friedrich Konrad

EUR

Abdichtungssysteme GmbH

MannheimPeter Kraft

EUR

26,000100%

Siegling GmbH

HanoverDr. Jan Lipton

EUR

10,230,000

100%

D

H

H
S

SABA Klebstoff- und

44 Forbo Financial Report 2002

MS
MS

Registered office

General management

Share capital

AthensPeter Garyfallou

EUR

896,000

Holding/Services

Belting

Adhesives

Flooring

Equity interest in %Company

GreeceForbo Swift Adhesives Greece S.A.I.C.

100%

MS

Hungary
Siegling Hungária Kft.

Budapest

Miklós Cserkaszky

HUF

30,000,000

100%

Swift Hungary Kft.

Budapest

András Mádi

HUF

3,000,000

100%

Blacum Ltd.

DublinJohn Siddle

EUR

25,395

Forbo Ireland Ltd.

DublinDerek F. Byrne

EUR

127,000

Waller & Wickham Ltd.

DublinKevin Wickham

EUR

2,520

S
S

IrelandS

100%
100% S
100%

S

100%

MS

Italy
Forbo Costenaro Mino S.p.a.

Pianezza (Vicenza)

Eros Mori

EUR

416,000

Forbo Resilienti S.r.l.

MilanoSergio de Conto

EUR

51,000Siegling Italia S.p.a.

Paderno Dugnano

Dr. Marco Tommasi

EUR

104,000

100%

S

Yokohama

Marco A. Crivelli

JPY

330,000,000

100%

MS

St. Helier

Denise Turpin

GBP

25,000100%

Johor Bahru

Marco A. Crivelli

MYR

2,500,000

100%

S

Tlalnepantla

Antonio Cillero

MXP

16,495,000

100%

S MS

100% SJapan
Siegling (Japan) Ltd.
Jersey, C. I.
Forbo Invest Ltd.

D

H

Malaysia
Siegling Malaysia SDN. BHD.
MexicoSiegling Mexico S. A. de C.V.
Netherlands
Eurocol B.V.

ZaanstadJos H. den Ronden

EUR

454,000

100%

MS

Forbo Genderen B.V.

GenderenToon A.T. Burghouts

EUR

27,000100%

S

Forbo Linoleum B.V.

Krommenie

Jeroen Tak

EUR

11,345,000

Forbo NL Holding B.V.

KrommenieDrs. Pieter Hartog

EUR

13,500,000

Forbo Novilon B.V.

Coevorden

Geurt Stuurman

EUR

3,630,000

Siegling Nederland B.V.

Spankeren-Dieren

Egbert J. van Heerikhuizen

EUR

113,000

100%

Swift Adhesives B.V.

Naaldwijk

Joris Grimbergen

EUR

65,000100%

VettreMorten Aarhus

NOK

1,000,000

Shenyang

Marco A. Crivelli

CNY146,391,000

100% MS

H

100%
100% MSS
MS

NorwayForbo Linoleum A/S

D

100% S

People’s Republic of China
Forbo Siegling (Shenyang)
Belting Co. Ltd.

MS

100%

PolandForbo Techniki Budowlane Polska Sp. z o.o. Warszawa

Jos H. den Ronden

PLZ

2,100,000

100%

S

Swift Adhesives Poland Sp. z o.o.

Warszawa

Andrzej Trojecki

PLZ

5,000

100%

S

Forbo Pergol Revestimentos S.A.

Porto

Henrique M. Santos Jr.

EUR

75,000100% S

Siegling (Portugal) Lda.

Gemunde (Maia)

José A. Pereira de Azevedo

EUR

235,000

100%

OradeaPeter Kraft

ROL

70,770,000

100%

PortugalS

Romania
Forbo Helmitin Romania S.R.L.

S

Forbo Financial Report 200245

Registered office

General management

Share capital

St. Petersburg

Alexander Petrakovski

RUB

Holding/Services

Belting

Adhesives

Flooring

Equity interest in %Company

RussiaSiegling (ZAO)

504,000

51%

100%

S

Spain
Forbo Adhesives Spain S.L.

Mos (Pontevedra)

José Castillo

Forbo Pavimentos S.A.

Barcelona

Agustin Matamoros

D

EUR

5,006

EUR

60,000MS

100% S

Siegling Iberica S.A.

Montcada i Reixac

José Flor Garre

EUR

1,533,000

100%

Swift Adhesifs S.A.

Rubi

José Castillo

EUR

60,121

100%

S
S

SwedenForbo Flooring AB

Gothenburg

Lars Ivar Norén

Forbo Parquet AB

Tibro

Christer Engelbrektsson

D

Forbo Project Vinyl AB

Gothenburg

Christer Engelbrektsson

Forbo Swift Sweden AB

Gothenburg

Mark McDonnell

GD-Golvdepån i Sverige AB

JönköpingPeter Körner

Siegling Svenska AB

MölndalRoger Olsson

Enia Carpet Group AG

EnnendaDr. Benjamin J. Fuchs

FJK Carpet D GmbH

EnnendaDr. Benjamin J. Fuchs

N

CHF

20,00025%

Forbo CTU AG

Schönenwerd

Dietmar Meyer

D

CHF

10,000,000

100%

Forbo Finanz AG

Eglisau

Gerold A. Zenger

D

CHF

10,000,000

100%

Forbo Giubiasco SA

Giubiasco

Dr. S. Krummenacher/D

CHF

10,000,000

100% MS

Forbo Immob AG

EglisauAndreas P. Lerch

CHF

1,700,000

100%

H

Forbo International SA

EglisauWerner Kummer

CHF

100,000

100%

H

Forbo Repoxit AG

Winterthur

Jürg D. Wettstein

CHF

100,000

100%

Immobilien Emmenau AG

Hasle bei Burgdorf

Andreas P. Lerch

CHF

1,000,000

100%

Siegling (Schweiz) AG

Wallbach

Walter Nehls

CHF

500,000

100%

Swifloor SA

Giubiasco

Daniele Ferretti

CHF

100,000

100% S

D

SEK

100,000

100% S

SEK

20,000,000

100% MS

SEK

50,000,000

SEK

100,000100%

SEK

700,000

100% S

SEK

1,000,000

100%

CHF

3,000,000

25%

100% MSSSSwitzerland

D. Ferretti

N

D

D

H
H
MS
H

MS
H
MS

United Kingdom
Forbo Nairn Ltd.

LondonBrian Paterson

GBP

8,000,000

Forbo Swift Adhesives Ltd.

ChatterisMark McDonnell

GBP

100

100%

Forbo UK Ltd.

LondonRankin McKee

GBP

22,500,000

100%

Stephens Miraclo Extremultus Ltd.

Dukinfield

Kevin Richardson

GBP

163,000

100%

Forbo Adhesives L.L.C.

Durham, NC

Jack L. Chambers

USD

100

100%

Forbo America Inc.

Wilmington, DE

Eugene Chace

USD

19,957,258

100%

Forbo America Services Inc.

Wilmington, DE

Eugene Chace

USD

50,000100%

H

Forbo Finance Inc.

Wilmington, DE

Eugene Chace

USD

100,000

100%

H

Forbo Linoleum Inc.

Hazelton, PA

Denis P. Darragh

USD

3 ,517,000

100% S

Siegling America L.L.C.

Huntersville, NC

Wayne Hoffman

USD

15,455,100

100%

D

100% MS

MS
H
S

USA

S Sales
MS Manufacturing and Sales
H Holding Services
N Not included in the 2002

consolidation

D Direct participations ofForbo Holding AG

46 Forbo Financial Report 2002

D

MS
H

MS

March 2003

Typesetting, Litho and Printing: Neidhart + Schoen AG, ZurichConception and Design: Gottschalk + Ash Int’l

Imprint
Publisher: Forbo Holding AG, Eglisau Zurich

Forbo Holding AG
CH-8193 Eglisau Zurich
Telephone +41 1 868 25 50
Fax +41 1 868 25 51
E-Mail info@forbo.com
www.forbo.com