Belting

Adhesives

Vinyl

Linoleum

2001

FINANCIAL REPORT

Contents

Forbo Group consolidated financial statements
3
8
9
10
11
12
17
31
32
33

Financial review and analysis
Consolidated income statement
Consolidated balance sheet
Consolidated cash flow statement
Consolidated statement of changes in shareholders’ equity
Accounting policies
Notes to the consolidated financial statements
Report of the Group Auditors
Consolidated income statements 1997–2001
Consolidated balance sheets 1997–2001
Financial statements of Forbo Holding SA

36
37
38
40
41

Income statement
Balance sheet
Notes to the financial statements
Proposal for appropriation of available earnings
Report of the Statutory Auditors
Additional information

42

Group companies

Forbo Group consolidated financial statements

Financial review and analysis
Summary of financial results

Net sales of continued operations
Net sales of divested activities

2001

2000

m CHF

m CHF

% change on
previous year

1,354.3

1,417.5

–4.5

130.8

359.3

1,485.1

1,776.8

–16.4

169.8

206.9

–17.9

9.6

27.6

of continued operations*

85.7

126.6

of divested activities

3.2

4.0

Net profit for the year

51.8

90.7

EVA® (Economic Value Added)

–2.1

20.8

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

*

–32.3
–42.9

including Corporate

Comment on the financial result development

The business year 2001 continued to be characterized by the implementation of theGroup’s strategy and focusing on core activities. In addition, some minor acquisitions could be made in the Adhesives Business. Under difficult trading conditions, theGroup recorded total net sales of CHF 1,485.1 million and an operating profit of
CHF 88.9 million. These figures include the activities of the Carpet Business, which
was divested in the year under review, for the first nine months.
The continued operations now comprise the four Strategic Business Units Linoleum,
Vinyl, Adhesives, and Belting. In the year under review, these businesses achieved net salesof CHF 1,354.3 million, corresponding with a decline of 0.5 % and 4.5 % in local currencies and Swiss Franc, respectively. The decrease of the operating profit before depreciation
and amortization (EBITDA) of the continued operations compared to previous year was
substantially more pronounced, i.e. by 17.9 % or CHF 37.1 million to CHF 169.8 million.
This is primarily due to the fact that the operating costs were geared to a planned 5 %sales growth and a proportionally higher profit contribution. Besides, the negative influence of lower exchange rates in Swiss Franc is some CHF 4.8 million. As a result, return on sales (ROS gross, EBITDA on Sales) dropped from 14.6 % to 12.5 %. The objective
for 2004 is 15%. After depreciation and amortization of CHF 84.1 million, the continued
operations reached an operating profit of CHF 85.7 million. The decrease compared withthe previous year is CHF 40.9 million or 32.3 %. Lower exchange rates in Swiss Franc
had a negative effect of CHF 3.3 million. The operating profit as a percentage of the operating assets employed (ROA) of the continued operations is now 7.9 %, clearly lower
than in the previous year (11.3 %). ROA adjusted by the three acquisitions made in the
Adhesives Business in the last four months of 2001 is 8.0 %. The objective definedfor 2004 is at least 13 % (EBITA on Operating Assets). The primary reasons for this result
deterioration in a difficult economic environment are as follows: The Linoleum
Business was not able to fully compensate higher raw material, energy, labor and marketing costs through higher productivity and sales. Vinyl for industrial uses recorded
strong sales losses for applications in the electronics industry. Belting suffered a sales
decline which could not be compensated by lower costs.

3 Financial Report 2001

Net financial expenses of CHF 16.0 million had a clearly more negative impact on the
consolidated profit than in the previous year (4.5 million). In 2000, capital gains of
CHF 9.0 million were realized with securities while the year under review saw valuation
losses of CHF 0.4 million. Furthermore, the share buy-back program caused additional interest costs of about CHF 3 million.
As a result of a clearly lower operating profit, higher financial expenses and lower exchange rates, Group profit was CHF 51.8 million or 42.9 % down on the previous year.

4 Financial Report 2001

Balance sheet summary

31.12. 2001

31.12. 2000

m CHF

m CHF

changem CHF

Long-term assets

716.4

778.9

–62.5

Current assets (excluding cash and marketable securities)

488.7

564.6

–75.9

Cash and marketable securities

126.5

183.1

–56.6

1,331.6

1,526.6–195.0Shareholders’ equity

652.2

813.9

–161.7

Financial debt

361.7

339.8

21.9

Total assets

Other liabilities and provisions
Total shareholders’ equity and liabilities

317.7

372.9

–55.2

1,331.6

1,526.6–195.0

Balance sheet development

The balance sheet total decreased by CHF 195.0 million to CHF 1,331.6 million compared with the previous year end. Of the total reduction, CHF 121.6 million relate
to operating assets of the carpet activities divested in the year under review, in which
Forbo still holds a financial interest of 25 %. In addition, securities and cash, notably
in connection with the share buy-back in 2001, declined by CHF 56.6 million. Furthermore, exchange rates, which were on average lower at year-end, caused the balance
sheet total to drop by CHF 33.6 million. This contrasts with additions from acquiredcompanies totaling CHF 25.2 million. Investments in long-term assets of the continued operations reached CHF 64.1 million, of which CHF 43.5 million relate to thefloor covering business and CHF 20.6 million to other areas. Thus, investments areclearly lower than the corresponding depreciation and amortization of CHF 84.1 million. Receivables and inventories could be kept somewhat below the previous year’slevel in local currencies, in line with the sales trend.
Financial situation

Net debt rose by CHF 78.5 million compared with the previous year end. This increase ison the one hand due to the share buy-back program in the amount of CHF 146.7 million, acquisitions in the adhesives business, and dividend payments. This contrasts, on theother hand, with reductions resulting from the divestment of the Carpet Business andfree cash flow generated. The decrease of the balance sheet total and the equity capital by
CHF 195.0 million and CHF 161.7 million, respectively, still resulted in an equity ratioof 49.0 % (previous year: 53.3 %). With this equity ratio and a gearing of 36.1 % (net debt
in % of equity capital), the Forbo Group is on a solid financial basis.

5 Financial Report 2001

Provisions

Of the specific provisions of CHF 70 million (after tax) made at the end of 1999 for implementing the new strategy, CHF 17.9 million were available at the beginning of the year
under review. This amount was completely used up in the business year 2001. In detail,the restructuring of the Vinyl Business absorbed CHF 9.1 million, the major part of which
was used for valuation adjustments of under-utilized production facilities. Another
CHF 1.5 million was used for restructuring the belting activities in Asia, and CHF 1.8 million was absorbed for measures in the European Adhesives Business. The divestmentof the Carpet Business used CHF 5.5 million. As a result, the essential objective of theGroup’s strategic renewal has been achieved with the focus on its four core businesses.
Free cash flow

The free cash flow (before dividend) of CHF 73.7 million (previous year: CHF 89.3 million) is calculated on the basis of the cash flow from operating activities reduced byinvestments in long-term assets (net). The decrease of the free cash flow by CHF 15.6 million compared with the previous year is due to a substantial decrease (minus
CHF 52.4 million) of the cash flow earned (consolidated profit before depreciation),and a lower cash inflow from disposals (CHF 6.6 million). This contrasts with areduced need for cash in relation to net working capital of CHF 36.3 million. Taking into
account the cash inflow from the divestment of the Carpet Business (CHF 56.7 million)
and the cash outflow associated with acquisitions in the Adhesives Business(CHF 15.3), the adjusted free cash flow is CHF 115.1 million.
Earnings per share

Related to the average number of outstanding shares, the 2001 earnings per share were
CHF 37.84 (based on the year-end position CHF 39.69) compared with CHF 61.98 in theprevious year. This is a decrease of 38.9 % and 36.0 %, respectively. The share buy-backprogram resulted in a profit increase per share meaning that the relative decrease of the
profit per share is less pronounced than the absolute profit development.
Share price development

The development of the Forbo share price in the year under review was characterized bystrong fluctuations. The price soared partly above CHF 800 especially in the first half-year
and after the announcement and subsequent buy-back of about 10 % of the outstanding
Forbo shares. In the third quarter after the announcement of the results for the firsthalf-year there was a strong correction downwards with share prices around CHF 600 in
August, and with short-term excursions down to CHF 420 as a result of the events in
New York in September. In the last quarter the share price recovered to reach CHF 505 at
year-end. Over a period of three years the Forbo share developed more or less in linewith the Swiss Performance Index (SPI), with occasional price fluctuations somewhat
stronger than the SPI. The Forbo share is likely to have a considerable price increase
potential assuming a recovery of the overall economy and the successful implementationof numerous internal measures.

6 Financial Report 2001

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 (WACC). In
the year under review, the return on the capital employed did not quite reach the weighted
average cost of capital. The resulting Economic Value Added (EVA®) was CHF –2.1 million(previous year: CHF 20.8 million). The decrease by CHF 22.9 million is essentially due
to a lower operating profit after taxes (NOPAT) and higher weighted average cost of capitalof 7.3% (previous year: 7.0%). While the higher percentage of borrowed capital resulting from the Forbo share buy-back had a positive impact on the weighted average costof capital, the equity capital cost rose from 8.4% to 9.1%. This is essentially due to thehigher volatility of the Forbo share price in the year under review, and the correspondingly
higher factor for adjusting the equity capital cost (Beta factor 2001: 0.86; previous year:
0.76 according to Bloomberg).
2001

2000

EVA® Calculation
m CHF

m CHF

Net operating profit after taxes (NOPAT)

67.8

95.2

Invested capital (IC)957.2

1,058.6

Average interest rate after taxes

3.8 %

3.6 %

Cost of equity capital

9.1%

8.4 %

Weighted Average Cost of Capital (WACC)

7.3 %

7.0 %

Economic Value Added (EVA®)

–2.1

20.8

7 Financial Report 2001

Consolidated income statement
2001

Net sales

Notes

m CHF

m CHF

1/2

1,485.1

1,776.8–962.7–1,143.2

Cost of goods sold
Gross profit
3

Development costs

2000

522.4

633.6

–22.0

–29.8

–288.6–333.6

Administrative costs

4–116.6–129.8Other operating expenses, net

5

–6.3

–9.8

Marketing and distribution costs

88.9

130.6

Financial income

7

5.5

16.8

Financial expenses

8

–21.5

–21.3

Operating profit

Profit before taxes
24

Taxes
Net profit for the year

72.9

126.1

–21.1

–35.4

51.8

90.7

2001

2000

Notes

CHF

CHF

Earnings per share (basic)

9

37.84

61.98

Earnings per share (diluted)

9

37.84

61.98

8 Financial Report 2001

Consolidated balance sheet
31.12. 2001

31.12. 2000

Assets
m CHF

m CHF

716.4

778.9

10

576.1

675.0

Intangible assets

11

23.2

19.4

Deferred taxes

24

72.7

65.1

Investments in associates and other long-term assets

11

Notes

Long-term assets
Tangible assets

Current assets

44.4

19.4

615.2

747.7

Inventories

12

227.0

260.7

Trade receivables

13

202.6

243.4

30.1

41.3

29.0

19.2

Other receivables
Prepaid expenses and deferred charges
Marketable securities

14

Cash and cash equivalents
Total assets

33.8

45.5

92.7

137.6

1,331.6

1,526.6

31.12. 2001

31.12. 2000

Shareholders’ equity and liabilities
Notes

Shareholders’ equity

m CHF

m CHF

652.2

813.9

Share capital

15

75.7

75.7

Treasury shares (incl. share buy-back program)

15–155.2–8.2

Reserves and retained earnings

731.7

746.4

Long-term liabilities

252.8

275.2

Deferred taxes

24

2.1

2.9

Employee benefit obligations

16

69.8

88.0

Provisions

17

16.4

39.2

Bond issues

18

148.4

100.0

Long-term bank loans and mortgages

19

16.1

45.1

426.6

437.5

79.4

90.2

55.0

47.9

Current liabilities
Trade payables

20

Other payables
Accrued expenses

21

95.0

104.7

Bank loans and overdrafts

22

197.2

194.7

1,331.6

1,526.6

Total shareholders’ equity and liabilities

9 Financial Report 2001

Consolidated cash flow statement
2001

2000

Cash flow from operating activities
m CHF

m CHF

Net profit for the year

51.8

90.7

Depreciation of tangible assets

85.9

99.3

Amortization of intangible assets
Increase (+)/decrease (–) in deferred income taxes and provisions
Increase (+)/decrease (–) in current liabilities (bank loans/overdrafts not included)
Increase (–)/decrease (+) in current assets

1)

Total cash flow from operating activities

4.5

4.6

–14.6

–19.8

3.0

–16.4

4.8

–12.1

135.4

146.3

2001

2000

Cash flow from investing/divesting activities
m CHF

m CHF

Cash flow (+)/cash drain (–) from divesting activities (incl. costs)2)

56.7

–3.6

Cash used for acquisitions

–15.3

0.0

Increase (–) in long-term assets

–66.4

–68.3

Decrease (+) in long-term assets
Total cash flow from investing activities (before securities)
Increase (–)/decrease (+) in marketable securities
Total cash flow from investing activities

4.7

11.3

–20.3

–60.6

3.9

22.3

–16.4

–38.3

2001

2000

m CHF

m CHF

Cash flow from financing activities
Share buy-back (incl. costs)–149.20.0

Increase (+)/decrease (–) in long-term bank loans and mortgages

21.8–100.8

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

–8.5

1.4

Increase (+)/decrease (–) in short-term bank loans/overdrafts

5.1

16.9

Change in treasury shares

–0.3

–1.8

Dividend paid

–32.4

–32.4

Total cash flow from financing activities–163.5–116.7

2001

2000

Change in cash and cash equivalents
m CHF

m CHF

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

–44.5

–8.7

Translation differences

–0.4

–1.6

Cash and cash equivalents at the beginning of the year

137.6

147.9

Cash and cash equivalents at the end of the year

92.7

137.6

2001

2000

m CHF

m CHF

44.5

8.7

Change in net debt
Increase (–)/decrease (+) in cash and cash equivalents

1)
2)

Increase (–)/decrease (+) in marketable securities

3.9

22.3

Increase (+)/decrease (–) in debt

26.9

–83.9

Translation differences

3.2

4.5

Net debt at the beginning of the year

156.7

205.1

Net debt at the end of the year

235.2

156.7

excluding cash and marketable securities
change in net debt

The changes in balance sheet positions are based on values exclusive of translation differences.

10 Financial Report 2001

Consolidated statement of changes
in shareholders’ equity
2000

At 1. 1. 2000

Sharecapitalm CHF

Treasurysharesm CHF

Reserves andretained earn.
m CHF

Translationdifferences
m CHF

Total
m CHF

75.7

–2.0

751.7

–30.6

794.8

–5.8

Change in accounting policies (SIC 16)
Net profit for the year

–0.4

Change in treasury shares

–5.8
90.7

90.7

–1.4

–1.8
–31.6

Translation differences–32.4

Dividend paid
At 31. 12. 2000

2001

At 1. 1. 2001

–31.6
–32.4

75.7

–8.2

808.6

–62.2

813.9

Share
capitalm CHF

Treasurysharesm CHF

Reserves andretained earn.
m CHF

Translationdifferences
m CHF

Total
m CHF

75.7

–8.2

808.6

–62.2

813.9

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)

–1.8

–0.3

–0.3

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

Cash flow hedges

–0.9

–0.9
–20.1

Translation differences–1.1

Realization due to divestments
75.7–155.211 Financial Report 2001

815.1

–20.1
–1.1
–32.4

–32.4

Dividend paid
At 31. 12. 2001

–7.7

–83.4

652.2

Accounting policies
Basis of preparation

The Group’s consolidated financial statements are prepared in accordance with thehistorical cost convention and comply with International Accounting Standards (IAS)
as issued by the International Accounting Standards Board (IASB) and Swiss law.
With effect from January 1, 2000 the Group has implemented interpretation 16 of the
IAS Standing Interpretations Committee (SIC) on Share Capital – Reacquired Own
Equity Instruments (Treasury Shares). The difference resulting from the initial adoptionof the interpretation was accounted for by adjusting retained earnings at January 1,
2000. Prior year figures have not been restated for practical reasons. Furthermore, theGroup has implemented International Accounting Standards IAS 36 on Impairmentof Assets and IAS 37 on Provisions, Contingent Liabilities and Contingent Assets as ofJanuary 1, 2000. These new standards did not have a material impact on the consolidated financial statements.
As of January 1, 2001, the Group has implemented IAS 39 on Recognition and Measurement of Financial Instruments. This has resulted in the recognition in the balance
sheet of the fair value of certain financial derivatives that were previously held off-balance
sheet. Net of tax, the decrease in equity due to the adoption of this standard was
CHF 1.8 million. The classification of the Group’s marketable securities as available-forsale and the related revaluation to fair values did not have a material impact on equity
at January 1, 2001. In accordance with the transition arrangements of the standard, thecomparative financial statements were not restated.
The preparation of financial statements requires management to make estimates andassumptions that affect the reported amounts of assets and liabilities and disclosure ofcontingent 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 SA and all subsidiaries
over which the Group exercises a controlling influence. A controlling influence normallyexists when the Group owns more than 50 % of the voting rights in a company.
Intragroup transactions 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 eliminatedfrom the accounts as of the date of disposal. The companies included in the consolidated
financial statements are listed under Group companies (pages 42–44). Companies inwhich the Group 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 overits 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.

12 Financial Report 2001

Foreign currency translation

The assets and liabilities of Group companies which do not report in Swiss Francs astheir reporting 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 theyear and the end of the year and the difference in net income translated at weighted
average and year-end 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 recognizedin 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.
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
and other 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 same depreciation rules apply for leased assets where the group companies assume
all the risks 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 shortand long-term loans, 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 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 valueof 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 andtheir market (net realizable) value. The valuation of work in progress and finished goods
includes related production overheads. Appropriate allowance is made for excess andobsolete inventories and reductions in sales prices. Unrealized profits on inventories resulting from intra-group transactions have been eliminated in the income statement
and balance sheet.

13 Financial Report 2001

Trade receivables

Trade receivables are stated at their nominal value less necessary allowance for doubtful receivables. 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-salemarketable 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 marketablesecurities are sold, the cumulative gains and losses previously recognized in equity areincluded in financial income or expense for the current period. Prior to the adoptionof IAS 39 the Group had valued its marketable securities at the lower of cost or market
value on a portfolio basis.
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.
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 arisingfrom a reduction of future tax liability due to the carry forward of allowable losses
and valuation differences are shown as assets only if levels of forecast profits make it likelythat 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 accordance with the advice of qualified actuaries. Actuarial gains and losses exceeding 10 % of
the greater of the employee benefit obligation and the plan assets are amortized over
the average remaining service lives of employees. Actuarial valuations were carried out in1999 on all significant defined benefit plans. As a rule full actuarial valuations arecarried out every three years and up-dated during the intervening period. The pension
obligation is 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 funded plans is limited to the net total of any unrecognized losses and past
service cost, and the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plan.

14 Financial Report 2001

Provisions

Provisions are recognized when the Group has a present or constructive obligation asa result 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.
Research and development

Expenditure under this heading refers exclusively to development and design activities
and is 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 of recognizing 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 (fairvalue hedge) or a 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 designatedand 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 hedged risk. Changes in the fair value of derivatives that aredesignated and qualify as cash flow hedges and that are highly effective, are recognized inequity. Where the forecasted transaction or firm commitment results in the recognitionof 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 deferred in equity are transferred to the income statement
and classified as revenue or expense in the same periods during which the hedged
firm commitment or forecasted transaction affects the income statement.

15 Financial Report 2001

Change of scope of consolidation

There has been a significant change in the scope of consolidation as a result of theacquisition of Carzuh, S. L., Spain as of September 1, 2001 as well as the divestment of theCarpet Business (Forbo Tapijt B.V., Netherlands, Forbo Bonaparte B.V., Netherlands,
Forbo Parade Tapijt B.V., Netherlands, B.V. Tapijtveredelingsindustrie, Netherlands, Forbo
Tapijt N.V., Belgium, Forbo Tapis S.à.r.l., France, Forbo Werke GmbH, Germany,
Design Tuft DT GmbH, Germany, Forbo Teppichwerke AG, Switzerland, Forbo Teppich
Ges.m.b.H., Austria und Forbo Padloburkolatok Kft., Hungary) as of October 1, 2001.
68 group companies were included in the consolidated financial statements as ofDecember 31, 2001 (77 group companies as of December 31, 2000).
Description of terms
Free cash flow

Cash flow from operating activities minus cash flow used for investments in long-term
assets, net.
EVA®

EVA® (Economic Value 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 7.3% (2000: 7.0%).
EVA® = NOPAT - WACC x IC
NOPAT : Net Operating Profit After Tax
WACC : Weighted Average Cost of Capital
IC : Invested CapitalSpecific provisions

Provisions 1999 for restructuring measures and valuation adjustments in connection with
the Group’s strategic renewal program.
Operating assets

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

16 Financial Report 2001

Notes to the consolidated financial statements
Segment information
1

By business segments 2001
Net sales

Flooring
m CHF

Adhesivesm CHF

Beltingm CHF

Divested
activities
m CHF

Corporate andConsolidation
m CHF

Total
m CHF

787.4

219.4

347.5

130.8

0.0

1,485.1

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

EBIT

78.6

16.6

14.4

3.2

–23.9

88.9

Operating assets

567.9

131.2

339.0

0.0

49.9

1,088.0

Capital investments

43.5

8.2

9.7

2.2

2.8

66.4

Number of employees

2,723

755

1,622

0

45

5,145

Flooring
m CHF

Adhesivesm CHF

Beltingm CHF

Divested
activities
m CHF

Corporate andConsolidation
m CHF

Total
m CHF

828.0

206.3

383.2

359.3

0.0

1,776.8

By business segments 2000
Net sales
EBITDA

145.0

26.4

51.3

27.6

–15.8

234.5

Depreciation and amortization

–46.0

–6.8

–23.1

–23.6

–4.4

–103.9

EBIT

99.0

19.6

28.2

4.0

–20.2

130.6

Operating assets

560.2

108.5

375.5

136.3

78.5

1,259.0

Capital investments

36.5

7.4

16.3

7.0

1.1

68.3

Number of employees

2,776

691

1,779

547

39

5,832

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

2,881

457

970

490

347

5,145

Europe(Eurozone)
m CHF

Switzerland
m CHF

Rest ofEuropem CHF

Americas
m CHF

Asia/
Africa
m CHF

Total
m CHF

Net sales

892.9

105.6

386.6

238.0

153.7

1,776.8

Operating assets

669.7

172.9

206.6

104.1

105.7

1,259.0

Capital investments

41.7

9.0

12.0

2.0

3.6

68.3

Number of employees

3,355

516

995

538

428

5,832

By geographical segments 2000

Net sales are based on the country in which the customer is located.

17 Financial Report 2001

Changes in net sales by businesses
2
2001

2000

Net sales

Totalchange
m CHF

m CHF

m CHF

Of which due
to exchange
rate changes
m CHF

Flooring

787.4

828.0

–40.6

–35.6

Adhesives

219.4

206.3

13.1

–5.8

18.9

Belting

347.5

383.2

–35.7

–15.2

–20.5

1,354.3

1,417.5

–63.2

–56.6

–6.6

Total (excluding divested activities)

Due to volume
and pricechanges
m CHF

–5.0

Development and production overhead costs
3

Development costs relate for the most part to design activities and amounted to
CHF 22.0 million (2000: CHF 29.8 million). Production overhead costs totaled
CHF 147.2 million (2000: CHF 185.8 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 licence fees or royalties.

Other operating expenses, net

2001

2000

m CHF

m CHF

5

Current costs and projects

2.1

1.9

Other expenses

18.7

18.3

Other income

–14.5

–10.4

6.3

9.8

Total other operating expenses, net

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

2001

2000

6
m CHF

m CHF

Salaries and wages

323.2

389.9

Employer’s social security contributions

75.8

88.8

Total personnel expenses

399.0

478.7

The Group’s headcount at December 31, 2001 was 5,145 (2000: 5,832). The average
headcount over the year was 5,656 (2000: 6,660). The divestments resulted in a reductionof 547 employees (2000: 1,023), the acquisitions in an increase of 84 employees.
About 130 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 SA. The participants
can dispose of these shares after a period of at least three years.

18 Financial Report 2001

Call options are issued to the Board of Directors and the Group Executive Board within
the framework of a stock option plan. As of today, options expiring in 2005 with an
exercise price of CHF 670 and options expiring in 2006 with an exercise price of CHF 741,
covering in total 7,312 registered shares, have been issued.
For details please see Annual Report (general part, page 37: Remuneration of the Board of
Directors and the Executive Board).

Financial income

2001

2000

m CHF

m CHF

3.4

5.0

7

Interest income
Securities and exchange gains and other financial income

2.1

11.8

Total financial income

5.5

16.8

Financial expenses

2001

2000

m CHF

m CHF

Interest on debt

18.1

19.0

Securities and exchange losses and other financial expenses

3.4

2.3

Total financial expenses

21.5

21.3

8

The average interest rate on interest-bearing debt (bond issues, long- and short-termbank loans, mortgages and discounted bills) in 2001 was 4.7 % (2000: 4.8 %).

Earnings per share
9

Earnings per share are calculated from net profit for the year divided by the weighted
average number of shares outstanding.

Net profit for the year (m CHF)
Weighted average number of shares outstanding

2001

2000

51.8

90.7

1,368,948 1,463,266

Earnings per share (net profit) (CHF)

37.84

61.98

With the exception of the call options mentioned under ‘Personnel expenses’ (6) thatcan be exercised in 2005 at the earliest, there were no financial instruments outstandingat December 31, 2001 and at December 31, 2000 that could have caused a dilution of
the amounts shown above. The Board of Directors had also taken no decision to increase
the number of shares outstanding.

19 Financial Report 2001

Tangible assets
10

The tangible assets also include leased assets with a net book value of CHF 4.2 million(2000: CHF 5.9 million) as well as non-operating property with a net book value of
CHF 40.0 million. The net book value of the non-operating property roughly equals its
fair value.

Cost

Land andMachinerybuildings and equipment
m CHF
m CHF

At 31.12.1999, gross
Additions

577.9

921.2

Other tangible
assetsm CHF

Assets underconstruction
m CHF

Total tangible
assets
m CHF

165.1

82.5

1,746.7

3.4

26.0

14.9

24.0

68.3

Reductions due to divestments–28.4–160.5

–10.6

–0.5

–200.0

Disposals

–25.5

–22.0

–9.7

–0.3

–57.5

Transfers

–10.1

19.6

1.8

–11.3

0.0

Translation differences

–17.7

–33.8

–6.4

–3.8

–61.7

At 31. 12. 2000, gross

1,495.8

499.6

750.5

155.1

90.6

Additions due to acquisitions

1.0

2.5

0.2

0.0

3.7

Other additions

5.7

31.1

11.3

18.2

66.3

Reductions due to divestments

–58.3

–79.3

–14.8

–1.9

–154.3

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

1,339.9Land andMachinerybuildings and equipment
m CHF
m CHF

Other tangible
assetsm CHF

Assets underconstruction
m CHF

Total tangible
assets
m CHF

122.2

3.7

933.6

Accumulated depreciation
At 31. 12. 1999, gross

188.8

618.9

Depreciation

18.4

59.8

16.9

4.2

99.3

Reductions due to divestments–14.5–110.5–9.8–0.2–135.0

Disposals

–14.4

–18.7

–8.3

0.0

–41.4

Transfers

0.0

0.1

–0.1

0.0

0.0

Translation differences

–6.7

–23.8

–4.9

–0.3

–35.7

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

Reductions due to divestments

–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

Total tangible assets at 31.12. 2000, net

328.0

224.7

39.1

83.2

675.0

Total tangible assets at 31.12. 2001, net

296.0

207.3

38.3

34.5

576.1

The fire insurance value of buildings, machinery and factory equipment of CHF 2,186 million (2000: CHF 2,395 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 28.4 million (2000: CHF 34.2 million).
The depreciation expense is included in ‘Cost of goods sold’, ‘Development costs’,‘Marketing and distribution costs’ and ‘Administrative costs’.
20 Financial Report 2001

Intangible assets and investments in associates
11

Cost

Intangible assets

Goodwillm CHF

Trademarks/
patentsm CHF

Investments
in associates
m CHF

At 31. 12. 1999, gross

24.6

29.0

Additions

0.0

0.0

Reduction due to divestments–0.1

Disposals–2.3Long-term
receivables
m CHF

Total
m CHF

2.5

0.0

56.1

0.0

17.0

17.0

0.0

0.0

0.0

–0.1

0.0

0.0

0.0

–2.3

Translation differences

0.0

0.0

–0.1

0.0

–0.1

At 31. 12. 2000, gross

22.2

29.0

2.4

17.0

70.6

Additions due to acquisitions

7.9

0.1

0.0

0.0

8.0

Other additions

0.1

0.0

4.9

20.8

25.8

Disposals

0.0

0.0

0.0

–0.6

–0.6

Translation differences

0.3

0.0

–0.1

0.0

0.2

At 31. 12. 2001, gross

30.5

29.1

7.2

37.2

104.0

Accumulated amortization

Intangible assets

Goodwillm CHF

Trademarks/
patentsm CHF

Investments
in associatesm CHF

Long-term
receivables
m CHF

Total
m CHF

At 31. 12. 1999, gross

13.0

16.6

0.0

0.0

29.6

Amortization

1.7

2.9

0.0

0.0

4.6

Reduction due to divestments

–0.1

0.0

0.0

0.0

–0.1

Disposals

–2.3

0.0

0.0

0.0

–2.3

At 31. 12. 2000, gross

12.3

19.5

0.0

0.0

31.8

Amortization

1.6

2.9

0.0

0.0

4.5

Translation differences

0.0

0.1

0.0

0.0

0.1

At 31. 12. 2001, gross

13.9

22.5

0.0

0.0

36.4

Total other long-term assets at 31.12. 2000, net

9.9

9.5

2.4

17.0

38.8

Total other long-term assets at 31.12. 2001, net

16.6

6.6

7.2

37.2

67.6

As of October 1, 2001 the Carpet Business has been deconsolidated. Other additions
to investments in associates include a 25 % interest in the newly created group(CHF 4.8 million). Other additions to long-term receivables include a subordinatedloan to the new group (CHF 19.0 million).

21 Financial Report 2001

Inventories

2001

m CHF

m CHF

Raw materials and supplies

47.4

56.1

Work in progress

80.1

95.1

2000

12

Finished goods

111.3

122.5

Allowance for product risks

–11.8

–13.0

Total inventories

227.0

260.7

Trade receivables

2001

2000

m CHF

m CHF

Accounts receivable

196.5

229.3

13

Notes receivable

26.7

34.2

Allowance for doubtful receivables

–20.6

–20.1

Total trade receivables

202.6

243.4

Marketable securities
14

Marketable securities at December 31, 2001 and December 31, 2000 consist entirely ofshares; primarily shares included in the SPI (Swiss Performance Index). They have beenclassified as available-for-sale.
Share capital

15

The share capital of Forbo Holding SA amounts to CHF 75,677,500 and is divided into
1,513,550 registered shares with a nominal value of CHF 50 each. Of these, 40,134 registered shares without voting and dividend rights are at the disposition of the Board of
Directors. In the context of the share buy-back program 156,974 registered shares havebeen repurchased and are to be eliminated. Consequently, 1,316,442 registered shares
carried dividend rights in the 2001 financial year. Changes in shares outstanding were as
follows:
1. 1. 2001

ChangeNumberNumber

31.12.2001

Changes in shares outstanding
Total shares

1,513,550

Number

1,513,550

Treasury shares
Shares with dividend right

10,406

Shares without dividend right

40,134

Share buy-backTotal treasury shares
Total shares outstanding

50,540984

11,390–40,134

156,974

156,974

157,958

208,498

1,463,010 –157,958 1,305,052

22 Financial Report 2001

Employee benefit obligations
16

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 treated asa 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 8.4 million (2000: CHF 9.2 million). Details of thepension expense related to the major defined benefit plans are as follows:

2001

Current service cost

2000

m CHF

m CHF

11.0

13.3

Interest on obligation

26.2

24.8

Expected return on plan assets

–32.0

–33.4

Effect of partial settlements

–3.8

0.0

Recognized actuarial gains

–0.1

0.0

Net periodic pension cost

1.3

4.7

Change of unrecognized assets

–1.7

2.0

(limit under IAS 19 para. 58b)
Translation differences on unrecognized assets

1.4

3.1

Total pension expenses

1.0

9.8

The actual return on plan assets was CHF –39.8 million (2000: CHF 9.0 million).
The amounts recognized in the balance sheet are as follows:
2001

2000

m CHF

m CHF

Present value of unfunded obligations

27.5

39.6

Present value of wholly or partly funded obligations

439.7

433.7

Fair value of plan assets–453.0–518.3

Unrecognized actuarial losses (–) and gains (+)

–39.4

34.2

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

63.1

64.8

Net liability in the balance sheet

37.9

54.0

The employee benefit obligations of CHF 69.8 million (2000: CHF 88.0 million) also
include provisions for early retirement and other benefits of about CHF 32 million.

23 Financial Report 2001

Movements in the net liability recognized in the balance sheet are as follows:
2001

Net liability at the beginning of the year

2000

m CHF

m CHF

54.0

55.8

Total pension expenses as included in personnel expenses

1.0

9.8

Employer contributions

–6.6

–7.6

Reductions due to divestments

–7.8

–0.6

Translation differences

–2.7

–3.4

Net liability at the end of the year

37.9

54.0

2001

2000

The principal actuarial assumptions used for accounting purposes were
(expressed as weighted averages):%%

Discount rate

5.5

5.5

Expected return on plan assets

6.3

6.3

Future salary increases

3.4

3.2

Provisions
17

Specific
provisions 1999
m CHF

Warranty
provisions
m CHF

Other
provisions
m CHF

Total
provisions
m CHF

At 31. 12. 2000

17.9

9.2

12.1

39.2

Charges to the income statement

0.0

1.2

1.5

2.7

Utilized during the year

–17.9

–1.1

–2.0

–21.0

Additions due to acquisitions

0.0

0.0

0.2

0.2

Reductions due to divestments

0.0

–2.0

–2.0

–4.0

Translation differences

0.0

–0.3

–0.4

–0.7

At 31. 12. 2001

0.0

7.0

9.4

16.4

Of the specific provisions of CHF 70 million (after tax) made at the end of 1999,
CHF 17.9 million were still available at the beginning of 2001. Thereof CHF 9.1 million
were absorbed for the restructuring of the Vinyl Business, where the major part was usedfor valuation adjustments of under-utilized production facilities. Another CHF 1.5 million was used for the restructuring of the belting activities in Asia, and CHF 1.8 million
was absorbed for measures in the European Adhesives Business. CHF 5.5 million were used
for the divestment of the Carpet Business in 2001.

24 Financial Report 2001

Bond issues

2001

2000

m CHF

m CHF

18

41/8 % Bond 2001–2006

150.0

0.0

4 % Bond 1996–2001

0.0

100.0

Unamortized issuance cost

–1.6

0.0

Total bond issues

148.4

100.0

41/8 % Bond 2001–2006

The bond’s duration is from June 8, 2001 to June 8, 2006. There is no early redemption
clause. The issuance costs are amortized over the duration of the bond.
4 % Bond 1996–2001

The bond’s duration was from June 11, 1996 to June 11, 2001. The bond was repaid
on June 11, 2001.
Long-term bank loans and mortgages

2001

m CHF

m CHF

Unsecured bank loans

90.2

99.1

Secured bank loans*

20.2

43.6

2000

19

Lease obligations

2.8

0.7

Sub-total

113.2

143.4

less current portion

–97.1

–98.3

Total

16.1

45.1

7.2

23.7

2001

2000

*

of which loans without fixed maturity date secured by property

Maturities of long-term bank loans and mortgages
m CHF

m CHF

after 1 year

1.7

25.4

after 2 years

1.6

1.0

after 3 years

1.5

6.0

after 4 years

1.5

10.0

after 5 and more years

9.8

2.7

Total

16.1

45.1

Secured bank loans are covered by property of the Group (book value CHF 63.7 million).
For interest charges, see ‘Financial expenses’ (8).
Trade payables

2001

m CHF

m CHF

Accounts payable

72.7

80.8

2000

20

Notes payable

6.7

9.4

Total trade payables

79.4

90.2

25 Financial Report 2001

Accrued expenses

2001

m CHF

m CHF

Current taxes

14.1

16.0

Accrued personnel expenses

19.4

26.8

2000

21

Other accruals

61.5

61.9

Total accrued expenses

95.0

104.7

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

2001

2000

22

Bank loans and overdrafts

m CHF

m CHF

100.1

96.4

plus current portion of long-term bank loans

97.1

98.3

Total short-term bank loans and overdrafts

197.2

194.7

2001

2000

m CHF

m CHF

2.2

3.4

For interest charges, see ‘Financial expenses’ (8)Commitments and contingent liabilities
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 not predictable and therefore not quantifiable.
There are no significant lawsuits pending.
Income taxes

2001

m CHF

m CHF

Current taxes

31.8

38.2

Deferred taxes

–10.7

–2.8

Total income taxes

21.1

35.4

2000

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 SA 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 geographical distribution of the taxable income. The income taxes for 2001 of CHF 21.1 million (2000: CHF 35.4 million) on the Group’s pre-tax profit of CHF 72.9 million (2000:
CHF 126.1 million) differ from the theoretical amount that would arise using the
maximum tax rate of Eglisau/Zurich, Switzerland of 28 % as follows:

26 Financial Report 2001

2001

2000

m CHF

m CHF

Tax at the applicable tax rate of 28 % for Eglisau/Zurich, Switzerland

20.4

35.3

Effect of different tax rates in other countries

0.7

2.5

Utilization of previously unrecognized tax losses

0.0

–2.4

Total income taxes (effective)

21.1

35.4

The tax loss carry forwards of the Group amount to about CHF 200 million. Tax loss
carry forwards totaling CHF 30 million will expire within the next seven years if they are
not used. The remaining amount of CHF 170 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:
2001

2000

m CHF

m CHF

Deferred tax assets

72.7

65.1

Deferred tax liabilities

–2.1

–2.9

Deferred tax assets, net

70.6

62.2

Deferred tax assets and liabilities and deferred tax charges and credits are attributable tothe following items:
Deferred tax assets
At 31. 12. 2000

Inventories
m CHF

Tangible
assetsm CHF

Provisions
m CHF

Tax losscarry forwards
m CHF

Other
m CHF

Total
m CHF

10.9

0.1

7.1

54.1

0.4

72.6

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

0.7

1.9

–1.3

10.0

1.8

13.1

Reductions due to divestments

–0.4

0.0

0.0

0.0

0.0

–0.4

Translation differences

–1.3

0.0

–0.5

–0.7

0.0

–2.5

At 31. 12. 2001

9.9

2.0

5.3

63.4

2.2

82.8

Inventories
m CHF

Tangible
assetsm CHF

Provisions
m CHF

Tax losscarry forwards
m CHF

Other
m CHF

Total
m CHF

–4.4

–5.8

0.0

0.0

–0.2

–10.4

to the income statement

–0.4

0.3

–1.6

0.0

–0.7

–2.4

Reductions due to divestments

0.5

0.0

0.0

0.0

0.0

0.5

Deferred tax liabilities
At 31. 12. 2000
Credited (+), charged (–)

Translation differences

0.0

0.1

0.0

0.0

0.0

0.1

At 31. 12. 2001

–4.3

–5.4

–1.6

0.0

–0.9

–12.2

Deferred tax assets at 31.12.2000, net

6.5

–5.7

7.1

54.1

0.2

62.2

Deferred tax assets at 31.12.2001, net

5.6

–3.4

3.7

63.4

1.3

70.6

27 Financial Report 2001

Statement of added value

2001

2000

25
m CHF

m CHF

Gross added value

578.3

713.1

Depreciation and amortization expense–90.4–103.9Net added value

487.9

609.2

Employees

399.0

478.7

Public sector

21.1

35.3

Creditors

16.0

4.5

Investors

32.4

32.4

Retained in the Group

19.4

58.3

Distribution of added value

Total

487.9

609.2

Net added value per employee (CHF)

86,26291,475

Translation of foreign currencies
26
2001

Currency

2000

2001

Income statement (average rates for the year)

2000
Balance sheet (year-end rates)

CHF

CHF

Change%CHF

CHF

Change%Euro countries

EUR

1

1.51201.5591–3

1.48091.5296–3

Sweden

SEK

100

16.35

18.45

–11

15.83

17.25

–8

United Kingdom GBP

1

2.43

2.56

–5

2.43

2.46

–1

USA

USD

1

1.69

1.69

–

1.68

1.65

2

Canada

CAD

1

1.09

1.14

–4

1.05

1.09

–4

Japan

JPY

100

1.39

1.57

–11

1.28

1.44

–11

Financial Risk Management27

In its international operations and financial activities the Forbo Group is exposed tovarious types of financial risks. In order to reduce risks arising from fluctuations in bothexchange rates of foreign currencies and interest rates the Group selectively uses derivative instruments. The various risks involved in existing assets and liabilities, plannedtransactions 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 theeffectiveness of the applied hedging instruments. Also, Corporate Treasury advises the
Finance Managers of the Group companies on the management of identified risks andrecommends both the extent of a potential hedge transaction and the appropriate type offinancial instrument. The Group’s financial risk management policy does neither allow
the use of derivative instruments for the purpose of trading nor for the purpose of speculation. The counterparties of derivative transactions are cautiously selected and thus
hedging transactions are concluded with strong financial institutions only (based on theassessments of the leading rating agencies).
All concluded derivative instruments are related to either management of currency risks
or management of interest rate risks.

28 Financial Report 2001

Management of currency risks

Risks arising from short-term currency exposures created by purchases and sales ofgoods 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, the Group 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, 2001:
Financial derivatives
Instrument

Forward contracts

Number ofcontracts

Gross value
hedged31.12.2001
m CHF

Unrealized
gain/loss
31.12.2001
m CHF

17

9.0

–0.1

In accordance with IAS 39 the above instruments are recognized in the balance
sheet at fair value at December 31, 2001. The accumulated fair value (total of all negativeand positive market values) at December 31, 2001 amounts to CHF –0.1 million(CHF 0.3 million at December 31, 2000). Changes in the fair value of these instruments
are recognized in the equity.
Furthermore, risks associated with the conversion of assets and liabilities denominatedin foreign 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 fluctuationsof interest rates. The Group makes use of financial derivatives in order to hedge againstinterest rate movements and in order to manage the duration of the interest rate
fixings. As a rule, the Group uses interest rate swaps with maturities of up to sevenyears only. These hedging transactions resulted in the following open positions at
December 31, 2001:
Financial derivatives
Instrument

Interest rate swaps

Number ofcontracts

Gross value
hedged31.12.2001
m CHF

Unrealized
gain/loss
31.12.2001
m CHF

12

96.3

–3.2

In accordance with IAS 39 the above instruments are recognized in the balance
sheet at fair value at December 31, 2001. The accumulated fair value (total of all negativeand positive market values) at December 31, 2001 amounts to CHF –3.2 million(CHF –2.3 million at December 31, 2000). Changes in the fair value of these instruments
are recognized in the equity.

29 Financial Report 2001

Acquisitions and divestments
28

The change in net assets due to acquisitions and divestments was as follows:
2001

2000

2001

2000

Acquisitions
m CHF

Acquisitions
m CHF

Divestments
m CHF

Divestments
m CHF

12.5

0.0

–67.9

–66.2

Long-term assets

11.7

0.0

–53.7

–65.0

Liabilities

–8.9

0.0

32.4

36.3

Total

15.3

0.0

–89.2

–94.9

Current assets (excluding cash and cash equivalents)

Events after the balance sheet date29

As already communicated in the media release of February 13, 2002, Forbo acquired
the car adhesives business of Dutch SABA Dinxperlo BV. In the business year 2001, thecompany had sales of some CHF 9 million. Furthermore, Forbo is in negotiations
with the US company Reichhold Inc. regarding the acquisition of their adhesives businessunder the name Swift. Swift represents an annual sales volume of currently some
CHF 400 million.

30 Financial Report 2001

Report of the Group Auditors

Report of the Group Auditors
to the General Meeting of
Forbo Holding SA, 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 theconsolidated financial statements) on pages 8 to 30 of Forbo Holding SA for the year
ended December 31, 2001.
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 issued by the International Federation of Accountants (IFAC), which require that an audit be plannedand 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 made andthe 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 Accounting Standards (IAS) and comply with Swiss law.
We recommend that the consolidated financial statements submitted to you be approved.
PricewaterhouseCoopers AG

L. Monn

S. Räbsamen

Zurich, March 7, 2002

31 Financial Report 2001

Consolidated income statements 1997–2001
2001

2000

1998

1997

m CHF

m CHF

m CHF

m CHF

m CHF

Net sales

1,485.1

1,776.8

1,754.5

1,714.5

1,905.0

Cost of goods sold–962.7–1,143.2–1,125.1–1,092.3–1,249.1

Gross profit

522.4

633.6

629.4

622.2

655.9

Development costs

–22.0

–29.8

–30.2

–31.2

–34.6

Marketing and distribution costs–288.6–333.6–335.2–333.0–375.0Administrative costs–116.6–129.8–122.3–120.0–133.9Other operating expenses

–6.3

–9.8

–18.7

–25.8

–16.1

Operating profit before specific provisions

88.9

130.6

123.0

112.2

Operating profit after specific provisions

88.9

130.6

53.0

96.3
–21.0*–70.0

Specific provisions

*

1999

112.2

75.3

Financial income

5.5

16.8

13.8

12.8

15.5

Financial expenses

–21.5

–21.3

–19.4

–20.6

–22.1

Profit before taxes

72.9

126.1

47.4

104.4

68.7

Taxes

–21.1

–35.4

–31.3

–27.7

–27.6

Net profit for the year

51.8

90.7

16.1

76.7

41.1

Divestment cost

32 Financial Report 2001

Consolidated balance sheets 1997–2001
2000

2001

1999

1998

1997

Assets
m CHF

m CHF

m CHF

m CHF

m CHF

Long-term assets

716.4

778.9

866.9

828.9

770.1

Tangible assets

576.1

675.0

813.1

781.3

742.3

Intangible assets

23.2

19.4

24.0

20.3

25.3

Deferred taxes

72.7

65.1

27.3

24.8

Investments in associates
and other long-term assets

44.4

19.4

2.5

2.5

2.5

Current assets

615.2

747.7

860.5

751.4

847.9

Inventories

227.0

260.7

306.2

291.4

295.1

Trade receivables

202.6

243.4

282.1

247.1

259.3

Other receivables

30.1

41.3

31.1

33.4

35.8

Prepaid expenses and deferred charges

29.0

19.2

19.6

18.9

20.6

Marketable securities

33.8

45.5

73.6

71.6

97.3

Cash and cash equivalents
Total assets

92.7

137.6

147.9

89.0

139.8

1,331.6

1,526.6

1,727.4

1,580.3

1,618.0

2001

2000

1999

1998

1997

Shareholders’ equity and liabilities
m CHF

m CHF

m CHF

m CHF

m CHF

Shareholders’ equity

652.2

813.9

794.8

798.3

761.1

Share capital

75.7

75.7

75.7

75.7

75.7

Treasury shares–155.2

–8.2

–2.0

–2.0

–2.0

Reserves and retained earnings

731.7

746.4

721.1

724.6

687.4

Long-term liabilities

416.2

252.8

275.2

458.6

372.5

Deferred taxes

2.1

2.9

4.0

5.2

8.4

Employee benefit obligations

69.8

88.0

91.8

67.1

59.5

Provisions

16.4

39.2

115.5

48.5

62.3

Bond issues

148.4

100.0

175.0

175.0

175.0

Long-term bank loans and mortgages

16.1

45.1

72.3

76.7

111.0

Current liabilities

426.6

437.5

474.0

409.5

440.7

Trade payables

79.4

90.2

139.6

120.5

119.8

Other payables

55.0

47.9

50.1

42.0

47.9

Accrued expenses

95.0

104.7

105.0

93.4

95.6

Bank loans and overdrafts
Total shareholders’ equity and liabilities

197.2

194.7

179.3

153.6

177.4

1,331.6

1,526.6

1,727.4

1,580.3

1,618.0

33 Financial Report 2001

Financial statements of Forbo Holding SA

Income statement of Forbo Holding SA
2001

2000

Notes

CHF

CHF

from investments in and advances to Group companies

1

64,737,770

65,415,775

from securities and short-term investments

2

258,098

12,136,279

IncomeIncomeIncome from services and other sources
Total income

7,008

898,10265,002,876

78,450,156

2001

2000

Expenses
Notes

CHF

CHF

Administrative expenses

3

4,834,583

2,315,631

Financial expenses

45,432,771

4,000,000

394,650

705,591

Taxes
Valuation adjustments

24,121,064

36,017,416

Total expenses

534,783,068

43,038,638

Net profit for the year

30,219,808

35,411,518

36 Financial Report 2001

Balance sheet of Forbo Holding SA(before appropriation of available earnings)
31. 12. 2001

31. 12. 2000

Assets
Notes

Long-term assets

CHF

CHF

390,695,850

422,256,519

306,013,834

320,149,662
102,106,857

Investments in Group companies

6

Advances to Group companies

7

84,682,016

Own shares (from share buy-back program)

8

146,673,6900Current assets

85,289,489

151,288,585

Other receivables from Group companies

1,899,379

3,796,806

Other receivables from third parties

1,860,637

2,011,672

Prepaid expenses and deferred charges

9

1,597,333

79,882Marketable securities

10

33,581,555

44,885,533

Cash

11

46,350,585

100,514,692

622,659,029

573,545,104

31. 12. 2001

31. 12. 2000

Total assets

Shareholders’ equity and liabilities
Notes

CHF

CHF

439,947,414

442,142,759

12/13

75,677,500

75,677,500

15,600,000

15,600,000

14155,238,428

8,156,796

15

132,127,488

279,209,121

Profit carried forward

31,084,190

28,087,824

Net profit for the year

30,219,808

35,411,518

182,711,615

131,402,345

Shareholders’ equity
Share capital
Statutory reserves
General reserves
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

100,000,000

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

37 Financial Report 2001

68,911

68,271

4,642,704

3,334,074

622,659,029

573,545,104

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

Income from investments in and advances to Group companies amounted to
CHF 64.7 million (previous year: CHF 65.4 million) and consisted exclusively ofinterest and dividend income.
Income from securities and short-term investments

2This item includes income from short-term investments of CHF 1.8 million(previous year: CHF 1.8 million) as well as realized losses from securities of CHF 1.5 million (previous year: realized gains on securities of CHF 10.3 million).
Adminstrative expenses

3

Adminstrative expenses amount to CHF 4.8 million and include nonrecurring cost of
CHF 2.2 million in connection with the share buy-back.
Financial expenses

4

The amount of CHF 5.4 million shown under ‘Financial expenses’ relates to the 4% bondissue 1996–2001 of CHF 100.0 million (up to June 11) and the 41/8 % bond issue 2001–2006
of CHF 150.0 million (from June 8). In addition, it includes the amortization of capitalized
costs incurred in connection with the issuance of the 41/8 % bond issue 2001–2006.
Valuation adjustments

5

Valuation adjustments of CHF 24.1 million (previous year: CHF 36.0 million) resulted
primarily from the divestment of the Carpet Business. In addition, they include unrealized
valuation losses (net) on securities of CHF 7.7 million.
Investments in Group companies

6

See list of Group companies on pages 42–44. The net decrease compared to the previous
year amounts to CHF 14.1 million. This is mainly attributable to the divestment of
the Carpet Business, and contrarily due to the foundation of Forbo Spain Holding, S. L.
Advances to Group companies

7

Advances to Group companies are denominated in Swiss Francs and foreign currencies.
There was a CHF 17.4 million decrease over the previous year’s figure.
Own shares (from share buy-back program)

8

In the context of the share buy-back program, 156,974 registered shares have been
repurchased for CHF 146.7 million. A proposal for a respective reduction of the sharecapital is submitted to the Annual General Meeting of Shareholders 2001.
Prepaid expenses and deferred charges

9

Prepaid expenses and deferred charges include, besides the usual items, capitalized
cost of CHF 1.6 million incurred in connection with the issuance of the 41/8 % bond issue
2001–2006 which are amortized over 5 years.
Marketable securities

10

Marketable securities include marketable bonds and shares, which are valued atmarket value.

38 Financial Report 2001

Cash
11

This item consists of cash and cash equivalents with original maturities of threemonths or less.
Share capital

12

The Company’s share capital amounts to CHF 75,677,500 and is divided into
1,513,550 registered shares with a nominal value of CHF 50 each. Of these, 40,134 registered shares without voting and dividend rights are at the disposition of the Boardof Directors. In the context of the share buy-back program 156,974 registered shares havebeen repurchased and are to be eliminated. Accordingly, 1,316,442 registered sharescarry dividend rights for the 2001 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 and warrants in connection with a with-warrants bond issue was created byresolution of the Annual 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, 2001 was unchanged on the previous year-end total at
CHF 8,322,500.
Reserve for own shares

14

The CHF 155.2 million included under ‘Reserve for own shares’ refer to shares acquiredby the Company in the context of the share buy-back program and other own shares heldby Group companies valued at cost. Details of own shares are as follows:

Own shares
CHF

No. of registeredshares nom.
value CHF 50

8,156,796

50,540146,673,690

156,974

407,942984

155,238,428

208,498

Cost

Total at 1. 1. 2001
Change due to share buy-back program
Other changes
Total at 31. 12. 2001

Other reserves
15

Other reserves showed a year-on-year decrease of CHF 147.1 million, attributable toa transfer to ‘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 41/8 % bond issue of CHF 150.0 million is due for redemption on June 8, 2006.
Contingent liabilities

18

No guarantees or letters of support issued to third parties in favour of Group companies
existed at year end. (previous year: CHF 4.8 million of which CHF 4.1 million utilized).

39 Financial Report 2001

Proposal for appropriation of available
earnings of Forbo Holding SA
The Board of Directors proposes to the Annual General Meeting of Shareholders that theavailable earnings, consisting of:
2001

2000

CHF

CHF

Net profit for the year

30,219,808

35,411,518

Profit carried forward from the previous year

31,084,190

28,087,824

Total available earnings

61,303,998

63,499,342

2001

2000

CHF

CHF

(2000: 1,473,416 shares at CHF 22.–)

28,961,724

32,415,152

to be carried forward to the following year

32,342,274

31,084,190

Total

61,303,998

63,499,342

2001

2000

be appropriated as follows:
Dividends on shares with dividend right:
1,316,442 registered shares at CHF 22.–

Upon approval of this proposal the dividend payment per sharefor the 2001 business year will be as follows:
CHF

CHF

Gross dividend

22.00

22.00

less 35 % federal withholding tax

7.70

7.70

Net dividend payment

14.30

14.30

40 Financial Report 2001

Report of the Statutory Auditors

Report of the Statutory Auditors
to the General Meeting of
Forbo Holding SA, Eglisau
As statutory auditors, we have audited the accounting records and the financial
statements (income statement, balance sheet and notes) on pages 36 to 39 of Forbo
Holding SA for the year ended December 31, 2001.
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 andindependence.
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
the financial 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

L. Monn

S. Räbsamen

Zurich, March 7, 2002

41 Financial Report 2001

Company

Place

General management

Holding/Services

Industry Specialties

Flooring

Group companies(January 2002)
Share capital

Australia
Forbo Floorcoverings PTY. Ltd.

Chester Hill N.S.W.

Derek F. Byrne (a.i.)

AUD

1 400 000

Siegling Australia PTY. Ltd.

Auburn N.S.W.

Simon Coates

AUD

1 000 000

Forbo Contel Handelsges.m.b.H.

ViennaFranz Kahr

EUR

73 000Forbo Industrieprodukte Ges.m.b.H.

Steyr/St. Ulrich

Walter A. Schmid

EUR

73 000S

Siegling Austria Ges.m.b.H.

ViennaErich Knoll

EUR

327 000

S

Forbo Krommenie S.A.

Groot-Bijgaarden

Lieven Messiaen

EUR

248 000

S

N.V. Forbo Novilon S.A.

Brussels

Frank F. Kruisheer

EUR

100 000

S

Forbo Linoleum Ltda.

Itapevi-SP

Walter Gianfaldoni

BRL

10 000S

Siegling Brasil Ltda.

Itapevi-SP

Raul E. A. Gollmann

PN BRL306 000DSSAustriaS

BelgiumBrazilMS

CanadaForbo Linoleum Inc.

TorontoDenis P. Darragh

CAD

500 000

Siegling Canada Ltd.

Mississauga

Rick Zingel

CAD

501 000

Brno

Gijsbertus A. Zoons

CZK

500 000S

S

SS

Czech Republic
Forbo s.r.o.
Denmark
Forbo Linoleum A/S

Glostrup

Jens-Christian Holm Iversen

DKK

500 000

Siegling Danmark A/S

BrøndbyRoger Olsson

DKK

1 000 000

HelsinkiAnne Takala

EUR

34 000EUR

3 050 000MS

Finland
Forbo Linoleum Oy

SFranceForbo Helmitin SA

Surbourg

Pierre Lux

Forbo Participations SA

Surbourg

Francis Bischwiller

Forbo Sarlino SA

Reims

Alain Réquillart

EUR

Siegling France SA

Lomme

D

MS

EUR 11 525 000

6 400 000

H
S

Egbert J. van Heerikhuizen

EUR

819 000

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

Dominique CarpentierEUR

3 092 000MS

Sté. de Production de Sols Vinyles – P.S.V. Reims

Alain Réquillart

EUR

3 447 000MSSGermany
Forbo Beteiligungen GmbH

Waldshut-Tiengen

Gerold A. Zenger

Forbo Erfurt GmbH

ErfurtRüdiger Beez

EUR

2 045 000

Forbo Helmitin GmbH

Pirmasens

Karl NohrEUR

5 113 000

Forbo Linoleum GmbH

Paderborn

Karl-Heinz Gerlitz

EUR

500 000

S

Forbo Novilon GmbH

Frankfurt am Main

Hans-Heinrich Kuhn

EUR

1 023 000

S

Siegling GmbH

HanoverDr. Jan Lipton

EUR 10 226 000

42 Financial Report 2001

D

EUR 15 339 000

H
MS
MS

MS

PlaceGeneral management

Share capital

Budapest

Miklós Cserkaszky

HUF

3 000 000

DublinDerek F. Byrne

EUR

127 000S

S

Holding/Services

Industry Specialties

Flooring

Company

Hungary
Siegling Hungária Kft.

S

Ireland
Forbo Ireland Ltd.
Italy
Forbo Resilienti S.r.l.

MilanoDr. Pierluigi Pacini

EUR

51 000Siegling Italia S.p.a.

Paderno Dugnano

Dr. Marco Tommasi

EUR

104 000

S

Yokohama

Marco A. Crivelli

JPY 330 000 000

MS

St. Helier

Denise Turpin

Johor Bahru

Tlalnepantla

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

D

GBP

25 000Marco A. Crivelli

MYR

2

S

Antonio Cillero

MXN 13 877 000

MS

H

Malaysia
Siegling Malaysia SDN. BHD.
MexicoSiegling Mexico S. A. de C.V.
The Netherlands
Forbo Genderen B.V.

GenderenToon A. T. Burghouts

Forbo Krommenie B.V.

Krommenie

Jeroen Tak

EUR

D

27 000

EUR 11 345 000

SMS

Forbo NL Holding B.V.

KrommenieDrs. Pieter C. Hartog

EUR 13 613 000

Forbo Novilon B.V.

Coevorden

Drs. Cornelis van Oostenrijk

EUR

3 630 000

Eurocol B.V.

Wormerveer

Jos H. den Ronden

EUR

454 000

MS

Siegling Nederland B.V.

Spankeren-Dieren

Egbert J. van Heerikhuizen

EUR

113 000

S

VettreMorten Aarhus

NOK

1 000 000

Shenyang

Marco A. Crivelli

CNY 66 337 000

Forbo Pergol Revestimentos S.A.

Porto

Henrique M. Santos Jr.

EUR

75 000Siegling (Portugal) Lda.

Gemunde (Maia)

José A. Pereira de Azevedo

EUR

235 000

S

St. Petersburg

Alexander Petrakovski

RUB

204 000

S

H
MS

NorwayForbo Linoleum A/S

DS

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

MS

Portugal
S

RussiaSiegling (ZAO)

43 Financial Report 2001

PlaceGeneral management

Share capital

Forbo Carzuh, S. L.

Vigo

José Castillo

EUR

300 019

Forbo Pavimentos S.A.

Barcelona

Agustin Matamoros

EUR

60 000Forbo Spain Holding, S. L.

MadridGerold A. Zenger

EUR

5 006

Siegling Iberica S.A.

Montcada i Reixac

José Flor Garre

EUR

1 533 000

Holding/Services

Industry Specialties

Flooring

Company

Spain

D

MS
S
H
S

SwedenForbo Linoleum AB

Gothenburg

Lars Ivar Norén

SEK

100 000

S

Forbo Parquet AB

Tibro

Christer Engelbrektsson

SEK 20 000 000

MS

Forbo Project Vinyl AB

Gothenburg

Christer Engelbrektsson

SEK 50 000 000MS

GD-Golvdepån i Sverige AB

JönköpingPeter Körner

SEK

700 000

S

Siegling Svenska ABKållered

Roger Olsson

SEK

1 000 000

3 000 000DS

Switzerland
FJK Carpet Holding AG

EnnendaDr. Benjamin J. Fuchs

PN CHF

Forbo CTU AG

Schönenwerd

Dietmar Meyer

D

CHF 10 000 000

Forbo Finanz AG

Eglisau

Gerold A. Zenger

D

CHF

Forbo Giubiasco SA

Giubiasco

Dr. S. Krummenacher/D. Ferretti D

CHF 10 000 000
CHF

1 700 000

H

CHF

100 000

H

H
MS

5 000 000

HMS

Forbo Immob AG

EglisauAndreas P. Lerch

Forbo International SA

EglisauWerner Kummer

Forbo Repoxit AG

Winterthur

Jürg D. Wettstein

CHF

100 000

Immobilien Emmenau AG

Hasle-Rüegsau

Andreas P. Lerch

CHF

1 000 000

Siegling (Schweiz) AG

Wallbach

Walter Nehls

CHF

500 000

Swifloor SA

Giubiasco

Daniele Ferretti

CHF

100 000

S

Forbo Nairn Ltd.

Kirkcaldy

B. Paterson/D. Prior

GBP

8 000 000MS

Forbo UK Ltd.

Kirkcaldy

Rankin McKeeD

GBP 22 500 000

H

Forbo America Inc.

Wilmington, DE

Eugene ChaceD

USD 20 000 000

H

Forbo America Services Inc.

Wilmington, DE

Eugene Chace

USD

50 000Forbo Linoleum Inc.

Hazelton, PA

Denis P. Darragh

USD

3 517 000

Siegling America L.L.C.

Huntersville, NC

Wayne Hoffman

USD 16 455 000

D

D

MS
H
MS

United Kingdom

USA

N Not includedin the 2001 consolidation
MS Manufacturing and Sales
S Sales
H Holding Services

D Direct participations ofForbo Holding SA
P Participations which are
not held at 100%

44 Financial Report 2001

H
S
MS

Imprint
Publisher: Forbo Holding SA, Eglisau/ZurichConception and Design: Gottschalk + Ash Int’l, Zurich
Typesetting, Litho and Printing: Neidhart + Schön AG, Zurich
March 2002

Forbo Holding AG
CH-8193 Eglisau/Zurich
Telephone + 41 1 868 25 50
Fax + 41 1 868 25 51
Forbo International SA
CH-8193 Eglisau/Zurich
Telephone + 41 1 868 25 25
Fax + 41 1 868 25 26

E-MailInvestor Relations
Gerold A. Zenger
gerold.zenger@forbo.com

E-MailCorporate Communications
Ursula Leonhard
ursula.leonhard@forbo.com