Swedish Match AB: Interim Report; January - September 2005 - Prepared in Accordance With IFRS.STOCKHOLM Stockholm (stŏk`hôlm'), city (1995 pop. 692,954), capital of Sweden and of Stockholm co., E Sweden, situated where Lake Mälaren flows into the Baltic Sea. , Sweden Sweden, Swed. Sverige, officially Kingdom of Sweden, constitutional monarchy (2005 est. pop. 9,002,000), 173,648 sq mi (449,750 sq km), N Europe, occupying the eastern part of the Scandinavian peninsula. -- Swedish Match Swedish Match is a Swedish company based in Stockholm that makes tobacco products and matches. It was founded as Svenska Tändsticksaktiebolaget by Ivar Kreuger in 1917 in Jönköping ("City of the matches"). The company changed its name in 1980. AB (STO STO Store (calculator function) STO Société de Transport de l'Outaouais (French) STO Strategic Technology Office (DARPA) STO Security Through Obscurity STO Service to Others :SWMA SWMA Software Maintenance SWMA Solid Waste Management Act SWMA Sine-Weighted Moving Average SWMA Storm Water Management Authority, Inc. (Homewood, AL) SWMA Segmental Wall Motion Abnormality (cardiology) ): --Third quarter net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight were 3,461 MSEK MSEK Meyer, Suozzi, English & Klein (New York law firm) MSEK Million Swedish Kroner (3,419), and nine month sales were 9,811 MSEK (9,797) --Operating income amounted to 953 MSEK (454) for the third quarter and 2,118 MSEK (3,061) for the first nine months --Operating income, excluding major one time items, for the third quarter amounted to 747 MSEK compared with 694 MSEK previous year and 1,912 MSEK (1,779) for the first nine months --Net profit for the third quarter amounted to 562 MSEK (219), and nine month net profit was 1,301 MSEK (1,770) --Third quarter EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. was 1.79 SEK SEK In currencies, this is the abbreviation for the Swedish Krona. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. (0.63), and nine month EPS was 4.08 SEK (5.26) Sales and results for the third quarter Swedish Match sales for the third quarter increased by 1 percent to 3,461 MSEK (3,419). In local currency terms sales decreased by 1 percent. Excluding divested companies, sales increased by 3 percent. All product areas except matches demonstrated sales growth. Match sales declined primarily as a result of the divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of Wimco Indian operations on July July: see month. 1, 2005. For snuff snuff, preparation of pulverized tobacco used by sniffing it into the nostrils, chewing it, or placing it between the gums and the cheek. The blended tobacco from which it is made is often aged for two or three years, fermented at least twice, ground, and usually , sales grew by 2 percent during the third quarter, to 809 MSEK (791) while operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. increased by 8 percent to 401 MSEK (371). Swedish Match volumes increased in both the US and Scandinavian markets. In Scandinavia Scandinavia (skăn'dĭnā`vēə), region of N Europe. It consists of the kingdoms of Sweden, Norway, and Denmark; Finland and Iceland are usually considered part of Scandinavia. , operating income improved as a result of volume growth for pouched pouched adj. Having a pouch, as a gopher, pelican, or marsupial. Adj. 1. pouched - having a pouch snuff. For the product group snuff, operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: was 49.5 percent (46.9). Sales of cigars in the third quarter amounted to 874 MSEK (848) and operating income grew by 8 percent, to 188 MSEK (174). Sales and operating income for cigars grew in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , while machine made cigars in
the US showed a weaker development. Operating income for premium cigars
in the US grew somewhat. Operating margin for cigars amounted to 21.5
percent (20.6).Group operating income for the third quarter reached 953 MSEK (454). During the third quarter 2005, the sale of the General Cigar building in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of resulted in pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta income of 206 MSEK. Last year's third quarter Group operating income included match impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charges and provisions amounting to 240 MSEK. Excluding these items, Group operating income exceeded year ago levels by 8 percent, reaching 747 MSEK (694). Operating margin for the third quarter amounted to 21.6 percent excluding the income for the building in New York. For the third quarter 2004, operating margin amounted to 20.3 percent excluding match impairment charges and provisions. During the third quarter EPS, both basic and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. , amounted to 1.79 SEK, compared to 0.63 SEK last year. Sales and results for the first nine months Sales for the first nine months amounted to 9,811 MSEK (9,797). Excluding divested companies, sales increased by 1 percent. Operating income amounted to 2,118 MSEK (3,061). Last year's operating income for the first nine months included some larger one time items, the income of 1,521 MSEK from the settlement with UST USt Umsatzsteuer (German: Tax) UST Underground Storage Tank UST University of St. Thomas (Minnesota, Texas) UST University of Santo Tomas (Manila, Philippines) and match impairment charges and provisions of 240 MSEK. Excluding the third quarter gain from the sale of the New York real estate and larger one time items the year before, operating income during the first nine months increased by 7 percent to 1,912 MSEK (1,779). EPS (basic) for the first nine months was 4.08 SEK (5.26). Excluding larger one time items earnings per share was 3.79 SEK compared to 3.30 SEK during last year's first nine months. Diluted EPS amounted to 4.06 SEK (5.24). Group operating margin during the first nine months was 19.5 percent excluding the gain from the sale of the New York real estate. Excluding larger one time items, operating margin during last year's first nine months was 18.2 percent.
Summary of Consolidated Income Statement
----------------------------------------------------------------------
January - Full
September year
MSEK 2005 2004 2004
------ ------ --------
Sales 9,811 9,797 13,007
Operating income excl. major one time
items 1,912 1,779 2,280
Operating income 2,118 3,061 3,561
Profit before tax 2,001 2,963 3,397
Net income incl. minority interest 1,301 1,770 2,061
----------------------------------------- ------ ------ --------
Sales by product area
----------------------------------------------------------------------
July - Jan - Sep Change 12 Full Change
Sep months year
ended
MSEK Sep 30,
2005 2004 2005 2004 % -05 2004 %
------ ------ ------ ------ ------ ------- ------- ------
Snuff 809 791 2,312 2,356 (2) 3,038 3,081 (1)
Chewing
Tobacco 290 285 800 821 (3) 1,036 1,058 (2)
Cigars 874 848 2,449 2,381 3 3,239 3,171 2
Pipe Tobacco
&
Accessories 241 234 674 659 2 916 901 2
Matches 298 348 961 1,012 (5) 1,327 1,378 (4)
Lighters 156 147 454 439 3 596 582 3
Other
operations 792 766 2,162 2,128 2 2,870 2,836 1
------ ------ ------ ------ ------ ------- ------- ------
Total 3,461 3,419 9,811 9,797 0 13,022 13,007 0
------------ ------ ------ ------ ------ ------ ------- ------- ------
In this interim report amounts are stated in Swedish crowns rounded to the nearest million. The figures in the report are based on data from the consolidation system which are in thousands of Swedish Crowns. By rounding the figures in the interim report, totals may not always equal the sum of the included rounded numbers.
Operating income by product area
----------------------------------------------------------------------
July - Jan - Sep Change 12 Full Change
Sep months
ended year
MSEK Sep 30,
2005 2004 2005 2004 % -05 2004 %
----- ----- ------ ------ ------ ------- ------ ------
Snuff 401 371 1,112 1,089 2 1,399 1,376 2
Chewing Tobacco 94 82 247 237 4 314 304 3
Cigars 188 174 436 460 (5) 544 567 (4)
Pipe Tobacco &
Accessories 62 69 177 182 (3) 249 254 (2)
Matches 31 28 45 (28) 60 (12)
Lighters 16 6 44 23 86 33 13 155
Other
operations (47) (38) (149) (184) (187) (222)
----- ----- ------ ------ ------ ------- ------ ------
Subtotal 747 694 1,912 1,779 7 2,412 2,280 6
Major one time
items
Income from
real estate
sale 206 - 206 - 206 -
Income from
settlement
with UST - - - 1,521 - 1,521
Match
impairment
charges - (150) - (150) - (150)
Provision for
acquisition
of shares in
Wimco Ltd. - (90) - (90) - (90)
----- ----- ------ ------ ------ ------- ------ ------
Subtotal 206 (240) 206 1,281 206 1,281
--------------- ----- ----- ------ ------ ------ ------- ------ ------
Total 953 454 2,118 3,061 (31) 2,618 3,561 (26)
--------------- ----- ----- ------ ------ ------ ------- ------ ------
Operating margin by product area
----------------------------------------------------------------------
July - Jan - 12 Full
Sep Sep months
ended year
Percent Sep 30,
2005 2004 2005 2004 -05 2004
----- ----- ----- ----- - ------- -----
Snuff 49.5 46.9 48.1 46.2 46.1 44.7
Chewing Tobacco 32.5 28.8 30.9 28.8 30.3 28.7
Cigars 21.5 20.6 17.8 19.3 16.8 17.9
Pipe Tobacco & Accessories 25.7 29.7 26.3 27.6 27.2 28.2
Matches 10.5 8.1 4.7 (2.7) 4.5 (0.9)
Lighters 10.4 4.4 9.6 5.3 5.6 2.2
----- ----- ----- ----- - ------- -----
Group(0) 21.6 20.3 19.5 18.2 18.5 17.5
------------------------------ ----- ----- ----- ----- - ------- -----
(0) Excluding major one time items Smokeless Tobacco smokeless tobacco, n chewing tobacco (leaves) or tobacco powder (snuff) that allows the nicotine to be absorbed through the mucous membrane of the oral cavity or digestive tract. It is related to a high risk of oral cancer. Swedish Match has an international presence in smokeless tobacco, and sells products on most major smokeless smoke·less adj. 1. Emitting or containing little or no smoke: smokeless factory stacks. 2. markets. Swedish Match is a market leader in snuff in Sweden and Norway Norway, Nor. Norge, officially Kingdom of Norway, constitutional monarchy (2005 est. pop. 4,593,000), 125,181 sq mi (324,219 sq km), N Europe, occupying the western part of the Scandinavian peninsula. . On the largest snuff market in the world, the US, as well as in South Africa South Africa, Afrikaans Suid-Afrika, officially Republic of South Africa, republic (2005 est. pop. 44,344,000), 471,442 sq mi (1,221,037 sq km), S Africa. , Swedish Match has a significant position. In the US, Swedish Match is the largest manufacturer on the market for chewing tobacco chewing tobacco, n See smokeless tobacco. chewing tobacco Smokeless tobacco, see there . Smokeless tobacco products are increasingly recognized as having significantly lower health consequences than cigarettes. This knowledge, together with increased restrictions for cigarette smoking creates good conditions for organic growth, especially for snuff. Snuff Sweden is the world's largest snuff market when it comes to per capita [Latin, By the heads or polls.] A term used in the Descent and Distribution of the estate of one who dies without a will. It means to share and share alike according to the number of individuals. consumption. In Sweden, a substantially larger proportion of the male population uses snuff compared to cigarettes. The number of women using snuff is steadily increasing. The Norwegian Norwegian associated in some way with Norway. Norwegian buhund, Norwegian sheepdog a medium-sized (26-40 lb), spitz-type dog with a short, dense coat in wheaten, black, red or sable, sometimes with black markings on the face, ears market, which is substantially smaller than the Swedish market, is at present showing strong growth. The US is the world's largest snuff market measured in number of cans and is approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. five times larger than the Swedish market. In Sweden and Norway, Swedish Match has the leading position. In the US, the Company is well positioned in the faster growing value price segment. Some of the best known brands include General, Ettan, and Grov GROV Grove in Sweden, Timberwolf in the US and Taxi in South Africa. During the third quarter, sales increased by 2 percent versus the previous year, to 809 MSEK (791), and operating income grew by 8 percent, to 401 MSEK (371). Volumes increased in Scandinavia (2.5 percent) as well as in the US (3.0 percent), measured in number of cans. Operating margin reached 49.5 percent (46.9). Sales for the first nine months amounted to 2,312 MSEK (2,356), a decrease of 2 percent. In Scandinavia sales volumes increased by 1.4 percent. In Sweden the decrease was 1 percent, while volumes in Norway as well as tax free sales increased. Loose snuff declined on the Swedish market, while sales of pouched snuff increased. The proportion of pouched snuff is currently 58 percent of the market, compared to 55 percent in September September: see month. 2004. Competition on the Swedish market has increased. Swedish Match's market share amounted to 94 percent according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the latest Nielsen Noun 1. Nielsen - Danish composer (1865-1931) Carl August Nielsen, Carl Nielsen estimates. In the US, year to date sales volumes were up by 1.3 percent versus previous year measured in number of cans. Sales of Longhorn The code name for the Windows Vista operating system. After the client version was renamed "Vista" in 2005, Longhorn referred to the server version until it was officially named Windows Server 2008 in May of 2007. See Windows Vista. were considerably higher than the year before, while sales for Timberwolf were lower. At the end of 2004 the Timberwolf brand was repositioned with a lower price. Swedish Match's total market share in the US market amounted to 9.4 percent (8.9) for the September year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. period, according to Nielsen estimates. Operating income year to date amounted to 1,112 MSEK (1,089), up 2 percent. On the Nordic market operating income increased mainly due to higher volumes, improved average prices and lower costs as a result of the accomplished reorganization The process of carrying out, through agreements and legal proceedings, a business plan for winding up the affairs of, or foreclosing a mortgage upon, the property of a corporation that has become insolvent. . In the US, operating income declined due the repositioning repositioning Laparoscopic surgery The changing of a Pt's position during a procedure to improve access or visualization of the operative field, which may be linked to complications, as it changes anatomic planes of operation. Cf Laparoscopic surgery. of the Timberwolf brand with a lower list price. Operating margin for snuff for the year to date was 48.1 percent (46.2). Chewing Tobacco Chewing tobacco is sold primarily in the North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. market, with concentration in the southern US. Well known brands include Red Man and Southern Pride. Swedish Match is the leading producer of chewing tobacco in the US, and the market share is 44 percent, according to Nielsen estimates. The chewing tobacco segment declines each year due to relatively few new consumers. Some consumers choose to use snuff instead. During the third quarter, sales increased by 2 percent, to 290 MSEK (285), and operating income grew by 15 percent, to 94 MSEK (82). Operating margin reached 32.5 percent (28.8). Sales for the first nine months declined by 3 percent to 800 MSEK (821), while operating income increased by 4 percent to 247 MSEK (237). The sales decrease is mainly attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to a weaker average rate during the first nine months for the US dollar. Higher average prices partially compensated compensated /com·pen·sat·ed/ (kom´pen-sa?tid) counterbalanced; offset. for volume loss and lower costs contributed to the improved operating income. Operating margin amounted to 30.9 percent (28.8). Cigars and Pipe Tobacco Swedish Match is one of the world's largest operators within cigars and pipe tobacco. Organic growth opportunities are mainly within cigars, while the consumption of pipe tobacco decreases. Cigars Swedish Match is the second largest producer of cigars and cigarillos in sales value. Swedish Match offers a full range of different cigars and brands. Well known brands include Macanudo Macanudo is an Argentine daily comic strip by the cartoonist Liniers. It is published in the newspaper La Nación. It appears on the last page of the paper. Just like Liniers' previous strip, Bonjour, Macanudo is very experimental and deals with meta humor. , La Gloria Glo·ri·a n. 1. a. A Latin doxology beginning with the words Gloria Patri. b. A Latin doxology that is the second item of the Ordinary of the Roman Catholic Mass and begins with the words Cubana, White Owl See Snowy owl , Garcia Gar·ci·a , Jerome John Known as "Jerry." 1942-1995. American musician who gained fame as the cofounder and lead guitarist of the folk-rock group the Grateful Dead (1965-1995). y Vega Vega (vā`gə), brightest star in the constellation Lyra; Bayer designation Alpha Lyrae; 1992 position R.A. 18h36.7m, Dec. +38°47'. A white main-sequence star of spectral class A0 V, its apparent magnitude is 0. , La Paz La Paz, city, Bolivia La Paz (lä päs), city (1992 pop. 713,378), W Bolivia, administrative capital (since 1898) and largest city of Bolivia. The legal capital is Sucre. , Justus Justus, in the Bible. 1 Surname of Joseph Barsabas. 2 or Titus Justus, Corinthian host of St. Paul. 3 Jesus Justus: see Jesus (2.) van Maurik Maurik () is a town in the Dutch province of Gelderland. It is a part of the municipality of Buren, and lies about 8 km north of Tiel. Maurik was a separate municipality until 1999, when it was merged with Buren. , and Wings. The US is the largest cigar market in the world and Swedish Match has a leading position in the premium segment, and is well established in the segment for machine made cigars. After the US, the most important cigar markets are in Europe, where Swedish Match is well represented in most countries, with an especially good market position in The Netherlands Netherlands (nĕth`ərləndz), Du. Nederland or Koninkrijk der Nederlanden, officially Kingdom of the Netherlands, constitutional monarchy (2005 est. pop. 16,407,000), 15,963 sq mi (41,344 sq km), NW Europe. and Scandinavia. In Europe, machine made cigars dominate. During the third quarter, sales increased by 3 percent, to 874 MSEK (848), and operating income increased by 8 percent, to 188 MSEK (174). Operating margins reached 21.5 percent (20.6). Unit volumes improved in Europe and for US premium cigars, while volumes were lower in the US mass market. Sales for the first nine months amounted to 2,449 MSEK (2,381), an increase of 3 percent. Sales were up in Europe and for premium cigars in the US, while sales were down for machine made cigars in the US as a result of increased market activities from competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. . Operating income for the first nine months declined by 5 percent to 436 MSEK (460). Operating margin amounted to 17.8 percent (19.3). Excluding charges of 75 MSEK related to the integration of General Cigar in 2005, and 11 MSEK regarding restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). programs in Europe in 2004, operating income grew by 9 percent. The increase in operating income is primarily due to lower costs as a result of previous restructuring measures. Pipe Tobacco and Accessories Swedish Match is one of the largest pipe tobacco companies in the world and its products are marketed worldwide. The Borkum Riff  This article or section is written like an .Please help [ rewrite this article] from a neutral point of view. Mark blatant advertising for , using . brand is sold in over 60 countries. The Company has its most significant presence in South Africa, where local production takes place. Best Blend and Boxer boxer, breed of medium-sized, muscular working dog perfected in Germany in the 19th cent. but whose origins may be traced back in Europe to the 16th cent. It stands from 21 to 25 in. (53.3–63.5 cm) high at the shoulder and weighs from 60 to 75 lb (27. are major brands in South Africa. Pipe tobacco consumption declines on most established markets, as the segment attracts relatively few new consumers. However, the demand is increasing in certain smaller export markets. During the third quarter, sales grew by 3 percent, to 241 MSEK (234), and operating income declined by 11 percent, to 62 MSEK (69). Operating margin was 25.7 percent (29.7). Sales for the first nine months amounted to 674 MSEK (659). Improved price levels and a strong South African Rand “ZAR” redirects here. For the former republic, see South African Republic. The rand is the currency of South Africa. It takes its name from the Witwatersrand (White-waters-ridge helped to compensate for lower volumes. Operating income was 177 MSEK (182). Operating margin amounted to 26.3 percent (27.6). Lights Swedish Match markets matches and lighters LIGHTERS, commerce. Small vessels employed in loading and unloading larger vessels. 2. The owners of lighters are liable, like other common carriers for hire; it is a term of the contract on the part of the carrier or lighterman, implied by law, that his vessel globally. Matches Swedish Match is a market leader in many markets for matches. The brands are mostly local, and have leading positions in their home countries. Major brands include Swan swan, common name for a large aquatic bird of both hemispheres, related to ducks and geese. It has a long, gracefully curved neck and an extremely long, convoluted trachea which makes possible its far-carrying calls. , Solstickan Solstickan is a Swedish charity foundation founded in 1936 for aiding needy children. Its ruling board is appointed by the Swedish government. The money for the foundation is gathered through the sales of the Solstickan matchbox, which over the years have become the most well , Three Stars, and Redheads. During the third quarter, sales declined by 15 percent, to 298 MSEK (348), and operating income was 31 MSEK (28). On July 1 the Indian match company Wimco Ltd. was divested. Excluding Wimco sales for the third quarter last year, sales were unchanged, but volumes declined. During the third quarter a writedown writedown A reduction in the value of an asset carried on a firm's financial statements. For example, the firm's accountants, believing the inventory is overvalued, may decide to take a writedown by reducing inventory valuation. in the match operations was made and the factory and property in Valencia, Spain For the Valencia wine region, see . Valencia (Spanish: Valencia [ba'lenθja];[1] Valencian: València [va'ɫɛnsia]) is the capital of the Spanish autonomous community of Valencia and its province. was divested with a gain. The match factory in Valencia Valencia, region, Spain Valencia (välān`thēä), autonomous region (1990 pop. 3,902,429) and former kingdom, E Spain, on the Mediterranean. It now comprises the provinces of Alicante, Castellón, and Valencia. was closed down during the first quarter this year. Sales for the first nine months amounted to 961 MSEK (1,012). In local currency terms, and excluding the effect of the Wimco divestiture, sales declined by 4 percent. Operating income during the first nine months was 45 MSEK (negative 28). These figures include costs of 31 MSEK for the closure of the Valencia, Spain factory during the first quarter 2005 and charges of 105 MSEK relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the restructuring of match operations in Europe during the first half of 2004. Excluding these items, the operating income was in line with last year. Operating margin amounted to 4.7 percent (negative 2.7). Lighters Swedish Match produces and distributes disposable disposable Nursing adjective Referring to that which is discarded or disposed of noun An item used in health care-related Pt contact which is discarded after use–eg masks, gloves, gowns, needles, paper products, syringes, wipes. See Biohazardous waste. lighters and the main brand is Cricket. Swedish Match's largest market is Russia Russia, officially the Russian Federation, Rus. Rossiya, republic (2005 est. pop. 143,420,000), 6,591,100 sq mi (17,070,949 sq km). . Several markets are faced with an intensely competitive situation from, among others, Chinese Chinese, subfamily of the Sino-Tibetan family of languages (see Sino-Tibetan languages), which is also sometimes grouped with the Tai, or Thai, languages in a Sinitic subfamily of the Sino-Tibetan language stock. producers. During the third quarter, sales grew by 6 percent, to 156 MSEK (147), and operating income grew to 16 MSEK (6). Increased volumes, lower costs and productivity improvements are behind the better results. Operating margin was 10.4 percent (4.4). Sales for the first nine months were 454 MSEK (439), an increase of 3 percent. Volumes increased but the average price for lighters decreased. Operating income increased to 44 MSEK (23). Operating margin improved to 9.6 percent (5.3). Other Operations Other operations include the distribution of tobacco products on the Swedish market, an Irish distribution business, sales of advertising products, as well as corporate overheads. During the third quarter, operating income amounted to a negative 47 MSEK (negative 38). Corporate overheads have increased due to work in fulfilling requirements under the Sarbanes Oxley Oxley refers to several things: People
For the first nine months, operating income for other operations was a negative 149 MSEK (negative: 184). Last year's expense included charges of 44 MSEK related to both the closure of a distribution center in Sweden and severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when payments and other expenses with regard to the former CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . Financing and net financial expense At the close of the period the Group's net debt amounted to 1,213 MSEK, as compared to 527 MSEK on December December: see month. 31, 2004, an increase of 686 MSEK. The increase is primarily due to the acquisition of the minority shares in General Cigar for 1,099 MSEK, share repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. of 895 MSEK and paid dividend of 612 MSEK. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses was 1,672 MSEK compared with 2,901 MSEK a year ago, which included the settlement with UST. During the period 10,367,514 shares were repurchased, amounting to 895 MSEK, and sales of treasury shares related to options programs amounted to 23 MSEK. During the period new bond loans of 911 MSEK have been issued. The bonds have been issued within the Group's outstanding bond programs. Amortization for the period amounted to 499 MSEK. Liquid funds, including short term investments, amounted to 2,747 MSEK at the end of the period, compared with 3,002 MSEK at the beginning of the year. Net interest expense for the first nine months amounted to a negative 109 MSEK (negative 113). Other financial items, net, amounted to an expense of 9 MSEK (16). Taxes Total tax for the first nine months amounted to 700 MSEK (1,194), corresponding to an average tax rate of 35 percent. The tax rate for the gain from the sales of the real estate in New York is estimated to be 55 percent. Earnings per share Earnings per share for the first nine months amounted to 4.08 SEK (5.26). The gain from the sale of the real estate has affected EPS positively by 29 oere. Last year's earnings per share, for the first nine months, was positively affected by larger one time items by 1.96 SEK. Capital expenditure, depreciation and amortization The Group's direct investments in tangible Possessing a physical form that can be touched or felt. Tangible refers to that which can be seen, weighed, measured, or apprehended by the senses. A tangible object is something that is real and substantial. An automobile is an example of tangible Personal Property. fixed assets fixed assets npl → activo sg fijo fixed assets npl → immobilisations fpl fixed assets fix npl → amounted to 271 MSEK (349). The investments include increased capacity for pouched snuff and rationalizations in the cigar operations. Total depreciation and amortization amounted to 346 MSEK (369), of which depreciation on tangible assets Tangible Asset An asset that has a physical form such as machinery, buildings and land. Notes: This is the opposite of an intangible asset such as a patent or trademark. Whether an asset is tangible or intangible isn't inherently good or bad. amounted to 257 MSEK (258) and amortization of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. amounted to 89 MSEK (111). Tobacco tax During the past 12 months, total tobacco tax and value-added tax value-added tax (VAT), levy imposed on business at all levels of the manufacture and production of a good or service and based on the increase in price, or value, provided by each level. on tobacco tax paid by Swedish Match in Sweden amounted to 9,668 MSEK (9,974). Average number of Group employees The average number of employees in the Group during the first nine months was 14,625 compared with 15,039 for the full year 2004. The number of employees decreased as a result of the divestment divestment to strip one's investment from an entity. of Wimco Ltd. and rationalizations within several product areas. Share structure During the first nine months of 2005 10.4 million shares were repurchased at an average price of 86.36 SEK. As at September 30, 2005 Swedish Match held 24.8 million shares in its treasury, corresponding to 7.4 percent of the total amount of shares. Total shares bought back by Swedish Match since the buyback Buyback The buying back of outstanding shares (repurchase) by a company in order to reduce the number of shares on the market. Companies will buyback shares either to increase the value of shares still available (reducing supply), or to eliminate any threats by shareholders who may programs started have been repurchased at an average price of 53.29 SEK. The number of shares outstanding, net after repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. and after the sale of treasury shares, as per September 30, 2005 amounted to 311.8 million. In addition, the Company has call options issued and outstanding on its treasury shares corresponding to 4.9 million shares exercisable in gradual The Gradual (Latin: graduale, sometimes called the Grail) is a chant in the extraordinary form of the Roman Catholic Mass, sung after the reading or singing of the Epistle and before the Alleluia, or, during penitential seasons, before the Tract. stages from 2005-2010. The Annual General Meeting on April 27, 2005 renewed re·new v. re·newed, re·new·ing, re·news v.tr. 1. To make new or as if new again; restore: renewed the antique chair. 2. the mandate A judicial command, order, or precept, written or oral, from a court; a direction that a court has the authority to give and an individual is bound to obey. A mandate might be issued upon the decision of an appeal, which directs that a particular action be taken, or upon a to repurchase shares up to 10 percent of the shares of the Company. In addition, a decision was made to cancel (character) Cancel - (CAN, Control-X) ASCII character 24. 12.0 million shares held in treasury. Furthermore, the Annual General Meeting decided to reduce the share capital by reducing the shares' nominal value Nominal Value The stated value of an issued security that remains fixed, as opposed to its market value, which fluctuates. Notes: When referring to fixed-income securities, the nominal value is also the face value. from 2.40 SEK to 1.20 SEK and reduce the statutory reserve of the parent company by 114 MSEK. These reductions became effective on October October: see month. 5 and consequently 532 MSEK was transferred from restricted equity to unrestricted equity. After the transfer to unrestricted equity, the total amount of registered shares in the Company is 324,596,181 of which the Company holds 12,832,900 shares in its treasury corresponding to 4.0 percent of the total amount of shares. Other events and events after the period During the second quarter, Swedish Match has acquired all outstanding shares of General Cigar and now owns 100 percent of the company. The second quarter was impacted by integration costs of 75 MSEK. Cost saving effects due to the integration is expected to impact results from 2006. During September the sale of General Cigar's real estate in New York was concluded. In February February: see month. 2005, The Second Circuit Court of Appeals in New York ruled in favour Favor or favour (see spelling differences) may be
Written instrument directed to an individual, government official, legislative body, or court in order to seek redress of grievances or to request a favour. to the US Supreme Court seeking review. This case has been ongoing since 1997. As previously announced, Swedish Match on July 1 sold its 74 percent holding of the Indian match company, Wimco to a subsidiary of Indian Tobacco Indian tobacco, name for several plants, among them lobelia. Company (ITC ITC (Brit) n abbr (= Independent Television Commission) → Fernseh-Aufsichtsgremium ITC n abbr (BRIT) (= Independent Television Commission) → ). Wimco is therefore not included in Swedish Match's consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: numbers as per July 1. On September 29, 2005 Swedish Match acquired 16.8 percent of the total amount of outstanding shares in Wimco in an open offer as per an earlier ruling from the Securities and Exchange Board of India Securities and Exchange Board of India (SEBI) is a board (autonomous body) created by the Government of India in 1988 and given statutory form in 1992 with the SEBI Act 1992. Its head office is in Mumbai, and other offices in Chennai, Kolkatta and Delhi. (SEBI SEBI Securities and Exchange Board of India SEBI Stock Exchange Bureau of India ). It is the intention of Swedish Match to sell these shares in connection with ITC's offer to buy all outstanding shares of Wimco, which the company estimates to be completed before the end of the current year. Distribution of surplus funds Surplus funds Cash flow available after payment of taxes in a project. Dividend Swedish Match's dividend policy is that the dividend should largely follow the trend of the Group's net income. When establishing a dividend, the size of planned repurchases of shares is also taken into account. It is estimated that the dividend amount will be between 30-50 percent of net income for the year. Repurchase A repurchase of shares is, in principle, a reverse new share issue and makes it possible to work continuously to optimize optimize - optimisation the capital structure of the balance sheet. In view of Swedish Match's stable and positive cash flow, the position of the Board of Directors with regard to repurchase of shares is positive. The size and scope of share buybacks depend, in exactly the same way as the size of the dividend, on Swedish Match's financial position, net income, anticipated future profitability, cash flow, investments and expansion plans. Other factors that affect repurchases are the price of the shares, the Group's interest and tax expenses, and the earnings available for distribution. Financial restrictions When considering the size of the surplus funds to be transferred to shareholders, it has been decided that the following restrictions should apply: --The Company shall over time strive for a capital structure with an interest cover based on EBITA EBITA Earnings Before Interest Taxes Amortization (profit before financial items, interest and amortization on intangible assets/net interest) that exceeds nine times. --The Company shall over time strive for a net debt divided by EBITA below two. Accounting principles This interim report is prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the Accounting Standard IAS See iPlanet Application Server. 1. (computer) IAS - The first modern computer. It had main registers, processing circuits, information paths within the central processing unit, and used Von Neumann's fetch-execute cycle. 34 Interim Financial Reporting from the International Accounting Standards Board  An editor has expressed concern that this article or section is .Please help improve the article by adding information and sources on neglected viewpoints, or by summarizing and . New accounting principles 2005 As of January January: see month. 1, 2005 Swedish Match changed its accounting principles for the preparation of financial statements to comply with International Financial Reporting Standards International Financial Reporting Standards (IFRS) are standards and interpretations adopted by the International Accounting Standards Board (IASB). Many of the standards forming part of IFRS are known by the older name of International Accounting Standards (IAS). (IFRS IFRS International Financial Reporting Standard(s) IFRS Inter Frame Relay Service IFRS Indiana Facilities Registry System ). Previously the financial statements were prepared in accordance with Swedish Generally Accepted Accounting Principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting ("Swedish GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). "). The financial statements for periods beginning on or after January 1, 2005 are therefore prepared in accordance with IFRS. IFRS has also been retrospectively ret·ro·spec·tive adj. 1. Looking back on, contemplating, or directed to the past. 2. Looking or directed backward. 3. Applying to or influencing the past; retroactive. 4. applied to year 2004 comparable data but with the exception of the reporting of financial instruments (IAS 32 and IAS 39) and share-based payments (IFRS 2). The financial instruments and share-based payments have not been restated as Swedish Match does not fall under the retrospective LAW, RETROSPECTIVE. A retrospective law is one that is to take effect, in point of time, before it was passed. 2. Whenever a law of this kind impairs the obligation of contracts, it is void. 3 Dall. 391. reporting requirements for these standards. The financial statements are from January 1, 2005, set up as specified spec·i·fy tr.v. spec·i·fied, spec·i·fy·ing, spec·i·fies 1. To state explicitly or in detail: specified the amount needed. 2. To include in a specification. 3. in IAS 1. The main implication implication In logic, a relation that holds between two propositions when they are linked as antecedent and consequent of a true conditional proposition. Logicians distinguish two main types of implication, material and strict. of applying IAS 1, is that net income, on the face of the income statement, and equity, on the face of balance sheet, are presented including the minority's interest. For Swedish Match, the transition to IFRS has changed the reporting of biological assets (IAS 41), goodwill (IFRS 3 and IAS 38), financial instruments (IAS 32 and IAS 39) and share-based payments (IFRS 2). The accounting principles for employee benefits (IAS 19) were already adopted on January 1, 2004 under Swedish GAAP and therefore Swedish Match's financial statements already complied with IAS 19 in 2004. Goodwill and biological assets Information on changes in accounting principles for biological assets (IAS 41) and goodwill (IFRS 3 and IAS 38), due to the transition to IFRS, is included in the report of operations for 2004 and the annual report for 2004. Financial instruments The rules for reporting of financial instruments, IAS 39, imply that financial assets Financial assets Claims on real assets. and liabilities, including all derivatives derivatives In finance, contracts whose value is derived from another asset, which can include stocks, bonds, currencies, interest rates, commodities, and related indexes. Purchasers of derivatives are essentially wagering on the future performance of that asset. , shall be measured at fair value or amortized cost depending on classification of the asset and liability. The gain or loss from a change in the value of a financial asset or liability shall be recognized, depending on classification, in profit or loss or directly in equity until realized. According to IAS 39, companies can apply hedge accounting Why is hedge accounting necessary? Many financial institutions and corporate businesses (entities) use derivative financial instruments to hedge their exposure to different risks (eg interest rate risk, foreign exchange risk, commodity risk, etc). . Under hedge accounting, a company shall link a balance sheet item to a designated hedging hedging, in commerce, method by which traders use two counterbalancing investment strategies so as to minimize any losses caused by price fluctuations. It is generally used by traders on the commodities market. instrument. To qualify for hedge accounting under IAS 39, the hedging relationship has to satisfy strict requirements. The major portion of the Group's borrowing was originally assumed at a fixed interest rate but subsequently converted to a floating rate by means of interest rate swaps Interest Rate Swap A deal between banks or companies where borrowers switch floating-rate loans for fixed rate loans in another country. These can be either the same or different currencies. . Swedish Match has decided to apply hedge accounting on interest rate swaps that can be linked to the original borrowing. All other financial instruments within Swedish Match will be subject to fair value accounting and the gain or loss from change in value will be recognized in the profit and loss. At transition to IFRS, the difference between the fair values or amortized costs of the financial assets and liabilities and the values reported according to Swedish GAAP was recognized directly in equity. Any initial recognition of derivatives not previously recognized was also reported directly in equity. At January 1, 2005, an increase in equity of 31 MSEK was thereby reported. The reporting in accordance with IAS 39 has resulted in a negative effect in net income by 3 MSEK during the first nine months of 2005. Share-based payments The rules for reporting of share-based payments (such as Swedish Match's option program), IFRS2, imply that an assessed fair value of the options shall be expensed during a vesting Vesting The process by which employees accrue non-forfeitable rights over employer contributions that are made to the employee's qualified retirement plan account. Notes: period or at a vesting date. During the first nine months 2005, net income has been negatively affected by 3 MSEK due to reporting in accordance with IFRS 2. Additional information This report has not been reviewed by the Company's auditors AUDITORS, practice. Persons lawfully appointed to examine and digest accounts referred to them, take down the evidence in writing, which may be lawfully offered in relation to such accounts, and prepare materials on which a decree or judgment may be made; and to report the whole, together . The full year 2005 report will be released February 15, 2006. The Annual General Meeting will be held in Stockholm on April 20, 2006. Stockholm, October 25, 2005 Sven SVEN Surveillance Video Entertainment Network (application that tracks pedestrians and generates music-video like visuals) Hindrikes President and Chief Executive Officer
Key data
----------------------------------------------------------------------
January - September 12 months Full year
ended
2005 2004 Sep 30, 2005 2004
------------ ------------ ------------ ---------
Operating
margin, %(1) 19.5 18.2 18.5 17.5
Operating
capital, MSEK 8,148 7,840 8,148 7,243
Return on
operating
capital, %(1) 30.2 29.1
Return on
shareholders'
equity, % 33.5 48.1
Net debt,
MSEK(2) 1,213 1,229 1,213 527
Net
debt/equity
ratio, % 24.6 24.4 24.6 10.5
Equity/assets
ratio, % 31.1 31.4 31.1 33.7
Investments in
tangible
assets, MSEK 271 349 409 486
EBITDA,
MSEK(3) 2,319 2,243 2,959 2,884
EBITA, MSEK(4) 2,030 1,913 2,581 2,464
EBITA interest
cover 18.7 17.0 16.3 15.2
Net debt/EBITA 0.5 0.2
Share data(5)
Earnings per
share, SEK
Basic 4.08 5.26 4.90 6.10
Diluted 4.06 5.24 4.89 6.08
Excluding
major one
time items,
diluted 3.77 3.29 4.61 4.12
Excluding
amortization
and major
one time
items,
diluted 4.00 3.56 4.94 4.50
Shareholders'
equity per
share, SEK 15.81 13.68 15.81 14.05
Number of
shares
outstanding
at end of
period 311,763,281 321,100,681 311,763,281 321,516,893
Average number
of shares
outstanding 316,983,930 327,155,038 318,080,314 325,708,645
Average number
of shares
outstanding,
diluted 318,028,805 328,487,004 319,163,877 327,013,542
-------------- ------------ ------------ ---------- ------------
(1) Excluding major one time items (2) Pension liabilities Pension liabilities Future liabilities resulting from pension commitments made by a corporation. Accounting for pension liabilities varies widely by country. are not included in net debt (3) Operating income excluding major one time items adjusted for depreciation, amortization and writedowns (4) Operating income excluding major one time items adjusted for amortization and writedowns of intangible assets (5) Net income attributable to Swedish Match equity holders
Consolidated Income Statement in summary
----------------------------------------------------------------------
July - Sep Jan - Sep Change 12 Full Change
months year
ended
MSEK Sep 30,
2005 2004 2005 2004 % -05 2004 %
------- ------- ------- ------------- ------- ------- ------
Sales,
including
tobacco
tax 5,754 5,761 16,244 16,362 21,587 21,705
Less
tobacco
tax (2,294) (2,342) (6,432) (6,566) (8,565) (8,698)
------- ------- ------- ------------- ------- ------- ------
Sales 3,461 3,419 9,811 9,797 0 13,022 13,007 0
Cost
of
goods (1,954) (5,403) (7,246)
sold (1,848) (a) (5,319) (a) (7,163) (a)
------- ------- ------- ------------- ------- ------- ------
Gross
profit 1,612 1,465 4,492 4,394 2 5,860 5,761 2
Sales
and
administ-
rative (664) (1,011) (2,386) (2,853) (3,256) (3,722)
expenses (c) (b) (c) (b) (c) (b)
Shares
in
earnings
of
associated
co. 4 (1) 12 (1) 15 1
------- ------- ------- ------------- ------- ------- ------
953 454 2,118 1,539 38 2,618 2,040 28
Settlement
income 0 0 0 1,521 0 1,521
------- ------- ------- ------------- ------- ------- ------
Operating
income 953 454 2,118 3,061 (31) 2,618 3,561 (26)
Net
interest
expense (47) (32) (109) (113) (158) (163)
Other
financial
items,
net (7) 8 (9) 16 (26) (2)
------- ------- ------- ------------- ------- ------- ------
Net
financial
items (54) (24) (117) (97) (185) (164)
------- ------- ------- ------------- ------- ------- ------
Profit
before
taxes 899 430 2,001 2,963 (32) 2,434 3,397 (28)
Taxes (337) (211) (700) (1,194) (843) (1,336)
Net
income
for
the
period 562 219 1,301 1,770 (27) 1,591 2,061 (23)
----------------- ------- ------- ------------- ------- ------- ------
Attrib-
utable
to:
Swedish
Match
equity
holders 562 200 1,292 1,721 1,560 1,988
Minority
interests 0 19 8 49 32 72
------- ------- ------- ------------- ------- ------- ------
Net
income
for
the
period 562 219 1,301 1,770 (27) 1,591 2,061 (23)
----------------- ------- ------- ------------- ------- ------- ------
Earnings per share, basic, SEK 1.79 0.63 4.08 5.26 4.90 6.10
Earnings per share, diluted, SEK 1.79 0.63 4.06 5.24 4.89 6.08
-------------------------------- ----- ----- ----- ----- - ----- -----
(a) Including impairment charge in match operations of 150 MSEK (b) Including provisions for acquisition of shares in Wimco Ltd. of 90 MSEK (c) Including income from sale of real estate of 206 MSEK
Consolidated Balance Sheet in summary
----------------------------------------------------------------------
MSEK
Sep 30, 2005 Dec 31, 2004
------------------------------
Intangible fixed assets 4,230 3,452
Tangible fixed assets 2,549 2,712
Financial fixed assets 949 760
Current operating assets 5,364 4,884
Short-term investments 804 1,815
Cash and bank 1,943 1,187
------------------------------
Total assets 15,839 14,809
----------------------------------------------------------------------
Swedish Match equity holders 4,930 4,516
Minority interests 3 481
------------------------------
Total equity 4,933 4,997
Long-term provisions 2,883 2,487
Long-term loans 3,525 2,559
Other long-term liabilities 43 21
Short-term provisions 817 647
Short-term loans 435 970
Other current liabilities 3,203 3,129
------------------------------
Total shareholders' equity, provisions
and liabilities 15,839 14,809
----------------------------------------------------------------------
Consolidated Cash Flow Statement in summary
----------------------------------------------------------------------
MSEK Jan - Sep 2005 Jan - Sep 2004
----------------------------------------------------------------------
Income after financial items 2,001 2,963
Non-cash items and taxes paid (332) (97)
Cash flow from operations before changes
in Working Capital 1,669 2,866
Cash flow from changes of Working
Capital 3 35
------------------------------
Cash flow from operations 1,672 2,901
Investments
Investments in property, plant and
equipment (271) (349)
Sales of property, plant and equipment 611 33
Investments in intangibles - (19)
Investments in consolidated companies - (53)
Payment of minority shares in General
Cigar (1,099) -
Investments in other companies - (10)
Divestment of business operations 7 117
Changes in financial receivables etc. (50) 6
Changes in short-term investments(1) 1,011 (1,052)
------------------------------
Cash flow from investments 209 (1,327)
Financing
Changes in loans 412 (733)
Dividends (612) (558)
Repurchase of own shares (895) (658)
Sale of treasury shares 23 63
Other (156) 31
------------------------------
Cash flow from financing (1,228) (1,855)
Cash flow for the period 653 (281)
Cash and bank at the beginning of the
period 1,187 1,497
Translation difference attributable to
cash and bank 103 (6)
------------------------------
Cash and bank at the end of the period 1,943 1,210
----------------------------------------------------------------------
(1) Refers to investments in short term securities as part of the cash management activities. The sum of cash and bank and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments amounted to 2,747 MSEK at the end of the period compared to 3,002 MSEK at the end of 2004.
Change in Shareholders' equity
----------------------------------------------------------------------
MSEK Jan - Sep 2005 Jan - Sep 2004
-------- --------- ------- -------- --------- --------
Swedish Minority Total Swedish Minority Total
Match interest equity Match interest equity
equity equity
holders holders
-------- --------- ------- -------- --------- --------
Opening balance
as per Dec 31 4,516 481 4,997 3,758 604 4,362
New accounting
principle, IAS
39 31 17 48
Repurchase of
own shares (895) (895) (658) (658)
Sale of
treasury
shares 23 23 63 63
Dividend paid (612) (612) (558) (558)
Acquisition of
minority
shares in
Best Blend (16) (16)
Acquisition of
minority
shares in
General Cigar (532) (532)
Divestment of
shares in
Wimco (6) (6)
Fair value
reserve IAS 39
etc. 5 5
Translation
difference for
the period 570 35 604 65 8 73
Net income for
the period 1,292 8 1,301 1,721 49 1,770
-------- --------- ------- -------- --------- --------
Closing balance
at end of
period 4,930 3 4,933 4,391 645 5,036
--------------- -------- --------- ------- -------- --------- --------
Quarterly data
----------------------------------------------------------------------
MSEK Q1/04 Q2/04 Q3/04 Q4/04 Q1/05 Q2/05 Q3/05
------- ------- ------- ------- ------- ------- -------
Sales,
including
tobacco tax 4,973 5,628 5,761 5,343 4,886 5,604 5,754
Less tobacco
tax (1,971) (2,252) (2,342) (2,132) (1,918) (2,220) (2,294)
------- ------- ------- ------- ------- ------- -------
Sales 3,002 3,376 3,419 3,211 2,967 3,384 3,461
Cost of goods
sold (1,585) (1,864) (1,804) (1,843) (1,629) (1,842) (1,848)
------- ------- ------- ------- ------- ------- -------
Gross profit 1,417 1,512 1,615 1,367 1,338 1,542 1,612
Sales and
administrative
expenses (909) (933) (921) (869) (811) (911) (870)
Shares in
earnings of
associated co. (1) 0 (1) 2 2 6 4
------- ------- ------- ------- ------- ------- -------
507 579 694 500 528 637 747
Income from
real estate
sale - - - - - - 206
Income from
settlement
with UST 1,417 104 - - - - -
Match
impairment
charges - - (150) - - - -
Provision for
acquisition of
shares in
Wimco Ltd - - (90) - - - -
------- ------- ------- ------- ------- ------- -------
Operating
income 1,924 683 454 500 528 637 953
Net interest
expense (42) (39) (32) (50) (20) (42) (47)
Other financial
items, net (4) 12 8 (17) (2) 0 (7)
------- ------- ------- ------- ------- ------- -------
Net financial
items (47) (27) (24) (67) (21) (42) (54)
------- ------- ------- ------- ------- ------- -------
Profit before
tax 1,878 656 430 433 507 595 899
Income taxes (738) (245) (211) (142) (167) (196) (337)
------- ------- ------- ------- ------- ------- -------
Net income for
the period 1,140 411 219 291 340 399 562
---------------------- ------- ------- ------- ------- ------- -------
Attributable
to:
Swedish Match
equity holders 1,130 391 200 268 333 397 562
Minority
interests 10 20 19 23 7 2 0
------- ------- ------- ------- ------- ------- -------
Net income for
the period 1,140 411 219 291 340 399 562
---------------------- ------- ------- ------- ------- ------- -------
Sales by product area
----------------------------------------------------------------------
MSEK
Q1/04 Q2/04 Q3/04 Q4/04 Q1/05 Q2/05 Q3/05
------ ------ ------ ------ ------ ------ ------
Snuff 751 814 791 726 703 800 809
Chewing Tobacco 254 282 285 237 242 267 290
Cigars 687 846 848 790 734 841 874
Pipe Tobacco &
Accessories 211 214 234 242 216 218 241
Matches 324 340 348 366 294 369 298
Lighters 146 146 147 142 143 155 156
Other operations 628 734 766 708 635 734 792
------ ------ ------ ------ ------ ------ ------
Total 3,002 3,376 3,419 3,211 2,967 3,384 3,461
--------------------- ------ ------ ------ ------ ------ ------ ------
Operating income by product area
----------------------------------------------------------------------
MSEK
Q1/04 Q2/04 Q3/04 Q4/04 Q1/05 Q2/05 Q3/05
------ ----- ----- ----- ----- ----- -----
Snuff 354 365 371 287 324 388 401
Chewing Tobacco 73 82 82 67 69 83 94
Cigars 129 156 174 108 136 112 188
Pipe Tobacco & Accessories 60 53 69 72 60 56 62
Matches (19) (37) 28 15 (17) 30 31
Lighters 8 9 6 (10) 12 15 16
Other operations (98) (48) (38) (38) (56) (46) (47)
------ ----- ----- ----- ----- ----- -----
Subtotal 507 579 694 500 528 637 747
Major one time items
Income from real estate
sale - - - - - - 206
Income from settlement
with UST 1,417 104 - - - - -
Match impairment charges - - (150) - - - -
Provision for acquisition
of shares in Wimco Ltd. - - (90) - - - -
------ ----- ----- ----- ----- ----- -----
Subtotal 1,417 104 (240) - - - 206
--------------------------- ------ ----- ----- ----- ----- ----- -----
Total 1,924 683 454 500 528 637 953
--------------------------- ------ ----- ----- ----- ----- ----- -----
Operating margin by product area
----------------------------------------------------------------------
Percent
Q1/04 Q2/04 Q3/04 Q4/04 Q1/05 Q2/05 Q3/05
----- ------ ----- ----- ----- ----- -----
Snuff 47.1 44.8 46.9 39.5 46.0 48.5 49.5
Chewing Tobacco 28.7 29.0 28.8 28.4 28.6 31.2 32.5
Cigars 18.8 18.5 20.6 13.6 18.6 13.3 21.5
Pipe Tobacco & Accessories 28.4 24.6 29.7 29.8 27.6 25.6 25.7
Matches (5.7) (11.0) 8.1 4.2 (5.6) 8.2 10.5
Lighters 5.7 5.9 4.4 (7.3) 8.6 9.8 10.4
----- ------ ----- ----- ----- ----- -----
Group(0) 16.9 17.1 20.3 15.6 17.8 18.8 21.6
--------------------------- ----- ------ ----- ----- ----- ----- -----
(0) Excluding major one time items Comparison of financial statements according to Swedish GAAP and IFRS In the tables below, the financial statements for the third quarter 2004 according to Swedish GAAP is accompanied ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. with the restated financial statements according to IFRS as well as the reconciliation between the two. A reconciliation of the full year 2004 financial statements according to Swedish GAAP and IFRS are presented in the fourth quarter interim report and annual report for year 2004.
Consolidated adjusted closing balance per Sep 30, 2004 in summary
----------------------------------------------------------------------
MSEK
Reported Goodwill Biological IFRS
assets
Sep 30, IAS 38 IAS 41 Sep 30,
2004
2004
-------- -------- ---------- -------
Intangible fixed assets 3,494 131 3,625
Tangible fixed assets 2,763 26 2,789
Financial fixed assets 517 517
Current operating assets 5,653 5,653
Short-term investment 1,210 1,210
Cash and bank 2,221 2,221
-------- -------- ---------- -------
Total assets 15,858 131 26 16,015
-------------------------- -------- -------- ---------- -------
Swedish Match equity
holders 4,262 112 17 4,391
Minority interests 638 6 1 645
-------- -------- ---------- -------
Total equity 4,900 118 18 5,036
Provisions 3,084 14 8 3,105
Long-term loans 4,047 4,047
Other long-term
liabilities 20 20
Short-term loans 613 613
Other current liabilities 3,195 3,195
-------- -------- ---------- -------
Total shareholders'
equity, provisions and
liabilities 15,858 131 26 16,015
-------------------------- -------- -------- ---------- -------
Consolidated Income Statement January - September, 2004 in summary
-------------------------------------------------------------------
MSEK
Reported Goodwill Biological IFRS
assets
Jul-Sep IAS 38 IAS 41 Jul-Sep
2004 2004
-------- -------- ---------- -------
Sales,
including
tobacco tax 5,761 5,761
Less tobacco
tax (2,342) (2,342)
-------- -------- ---------- -------
Sales 3,419 3,419
Cost of goods
sold (1,963) 9 (1,954)
-------- -------- ---------- -------
Gross profit 1,456 9 1,465
Sales and
administrative
expenses (969) (969)
Amortization,
intangible
assets (87) 45 (42)
Shares in
earnings of
associated
companies (1) (1)
-------- -------- ---------- -------
400 45 9 454
Settlement
income 0 0
-------- -------- ---------- -------
Operating
income 400 45 9 454
Net interest
expense (32) (32)
Other financial
items, net 8 8
-------- -------- ---------- -------
Net financial
items (24) (24)
-------- -------- ---------- -------
Profit before
taxes 376 45 9 430
Taxes (203) (5) (3) (211)
-------- -------- ---------- -------
Net income for
the period 173 40 6 219
--------------- -------- -------- ---------- -------
Attributable
to:
Swedish Match
equity holders 156 38 6 200
Minority
interests 17 2 0 19
-------- -------- ---------- -------
Net income for
the period 173 40 6 219
--------------- -------- -------- ---------- -------
--------------- -------- -------- ---------- -------
Earnings per
share, basic,
SEK 0.49 0.63
Earnings per
share,
diluted, SEK 0.49 0.63
--------------- -------- -------- ---------- -------
Consolidated Income Statement January - September, 2004 in summary
----------------------------------------------------------------------
MSEK
Reported Goodwill Biological IFRS
assets
Jan-Sep IAS 38 IAS 41 Jan-Sep
2004 2004
-------- -------- ---------- --------
Sales, including tobacco tax 16,362 16,362
Less tobacco tax (6,566) (6,566)
-------- -------- ---------- --------
Sales 9,797 9,797
Cost of goods sold (5,421) 18 (5,403)
-------- -------- ---------- --------
Gross profit 4,375 18 4,394
Sales and administrative
expenses (2,742) (2,742)
Amortization, intangible assets (243) 133 (111)
Shares in earnings of associated
companies (1) (1)
-------- -------- ---------- --------
1,388 133 18 1,539
Settlement income 1,521 1,521
-------- -------- ---------- --------
Operating income 2,910 133 18 3,061
Net interest expense (113) (113)
Other financial items, net 16 16
-------- -------- ---------- --------
Net financial items (97) (97)
-------- -------- ---------- --------
Profit before taxes 2,812 133 18 2,963
Taxes (1,174) (14) (5) (1,194)
-------- -------- ---------- --------
Net income for the period 1,638 119 13 1,770
-------------------------------- -------- -------- ---------- --------
Attributable to:
Swedish Match equity holders 1,596 113 12 1,721
Minority interests 42 6 1 49
-------- -------- ---------- --------
Net income for the period 1,638 119 13 1,770
-------------------------------- -------- -------- ---------- --------
-------------------------------- -------- -------- ---------- --------
Earnings per share, basic, SEK 4.88 5.26
Earnings per share, diluted, SEK 4.86 5.24
-------------------------------- -------- -------- ---------- --------
Swedish Match AB (publ), SE-118 85 Stockholm Visiting address: Rosenlundsgatan 36, Telephone: 08 658 02 00 Corporate Identity Number: 556015-0756 www.swedishmatch.com |
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