annual report 2001 glaverbel - ku leuven€¦ · 780.6 630.1 620.3 281.4 186.2 144.0 13.1 1.27 0.79...
TRANSCRIPT
GlaverbelGlaverbel2 0 0 1a n n u a l r e p o r t
.
1
contentsstock exchange data, financial highlights 2
message from the chairman of the executive committee 5
financial performance 9
group results 9
financial operations 10
shareholder information 12
news of the divisions 15
research & development 15
building division 16
automotive division 18
industries division 20
investments for the future 23
human resources 23
communication 24
environment, safety and quality 24
capital expenditure 25
Bor Glassworks 26
directors, managers and auditors 28
corporate governance 30
On 13 May 2002 the Banking and Finance Commission authorised theuse of this annual report as a reference document to support anypublic call for funds made by Glaverbel SA, until the publication of itsnext annual report, under the provisions of Heading II of Royal DecreeNo. 185 of 9 July 1935, according to the procedure for publishinginformation.Under this procedure, the reference document must be accompaniedby an operations note in order to constitute a prospectus in the senseof art. 29 of said Royal Decree.This prospectus must be submitted for the approval of the Bankingand Finance Commission in accordance with art. 29 ter, º 1, para. 1 ofRoyal Decree No. 185 of 9 July 1935.
declaration of conformityThe Board of Directors of Glaverbel SA, represented by Messrs. LucWillame and Yves Schoonejans, assumes responsibility for this refer-ence document, and certifies that to the best of its knowledge, theinformation contained therein is a true and accurate picture of reality,and does not contain any omission which might compromise itsscope.
auditing of the financial statementsThe company financial statements and the consolidated financialstatements of Glaverbel SA to 31 December 1999, 2000 and 2001(the latter appearing as the blue part of this report) have been auditedby Arthur Andersen, company auditors (Montagne du Parc 4, 1000Brussels), represented in 1999 and 2000 by Messrs. Henri Lembergerand Gino Desmet and, in 2001, by Mr. Guy Wygaerts. The auditorshave approved the financial statements without qualification.
theme of the annual report
Multiculturalism, Performance and Innovationhave been the key concepts behind thegrowth of the Group over the past ten years.Now, these concepts will serve us even betterin writing the fresh chapter that we arecommencing, with a global Network formedby the new glassmaking entity, “a promisinggroup”.
2202001801601401201008060%
2
stock exchange dataCONSOLIDATED DATA PER SHARE (at the end of the period)
SHARE PRICE (EUR)
STOCK EXCHANGECAPITALISATION (EUR million)
TOTAL NO. OF SHARES
PER (1) (2)
P/CF (1) (3)
NET INCOME,GROUP SHARE (1) (EUR)
GROSS DIVIDEND (EUR)
PAY-OUT (in %) (4)
1997
SHAREHOLDER’S DIARY
ANNOUNCEMENT OF 2001 ANNUAL RESULTS OF THE GLAVERBEL GROUP
ANNOUNCEMENT OF RESULTS FOR FIRST QUARTER
ANNUAL GENERAL MEETING
PAYMENT OF 2001 DIVIDENDS
ANNOUNCEMENT OF RESULTS FOR FIRST HALF
ANNOUNCEMENT OF RESULTS FOR THIRD QUARTER
ANNOUNCEMENT OF 2002 ANNUAL RESULTS
ANNUAL GENERAL MEETING
1998 1999 2000 2001 from 1/1 to31.03.2002
25 February 2002
29 April 2002
29 May 2002
5 June 2002
30 August 2002
22 October 2002
24 February 2003
28 May 2003
(1) The divisor is the number of shares pro rata temporis, excluding treasury shares.(2) Price/Earnings ratio, i.e. the share price at the end of the year, divided by net current income (Group share) per share.(3) Price/Cash flow ratio, i.e. the share price at the end of the year, divided by net current income (Group share) plus
depreciations, write-downs and provisions per share (not restated to take account of minority interests).(4) Ratio of gross dividend to net income (Group share) per share.
More information for shareholders on pages 12-13.
SHARE PRICE TREND
Glaverbel
BEL 20
143.78
1 018.8
7 086 023
20.3
6.3
5.28
3.07
58.2
112.79
799.2
7 086 023
15.8
4.6
6.46
3.27
50.6
85.70
607.3
7 086 023
12.1
3.5
3.93
3.42
87.3
79.75
565.1
7 086 023
3.8
1.9
15.57
3.77
24.2
143.00
1 013.3
7 086 023
5.6
2.8
20.46
4.14
20.2
144.50
1 023.9
7 086 023
99 00 0197 98 99 00 0197 98 99 00 0197 98
200
180
160
140
120
100
80
606060
40
20
0
-20
-40
-60
3
financial highlightsGLAVERBEL GROUP (EUR million)
SALES
GROWTH
GROSS OPERATING CASH FLOW (2)
OPERATING INCOME
FINANCIAL EXPENSE
AMORTISATION OF GOODWILL
CURRENT GROSS INCOME (3)
EXTRAORDINARY ITEMS
NET INCOME AFTER TAXES
MINORITY INTERESTS
NET INCOME, GROUP SHARE
NET CURRENT INCOME, GROUP SHARE (4)
GROSS OPERATING CASH FLOW/SALES
OPERATING INCOME/SALES
NET CURRENT INCOME (GROUP SHARE)/SHAREHOLDERS’ EQUITY(GROUP SHARE) ON 01/01 (5)
RETURN ON CAPITAL EMPLOYED (6)
SHAREHOLDERS’ EQUITY (7)
SHAREHOLDERS’ EQUITY, GROUP SHARE
NET INDEBTEDNESS (8)
NET CASH FLOW
INVESTMENT FINANCING REQUIREMENTS (RESOURCES)
CAPITAL EXPENDITURE
R&D
LIQUIDITY RATIO
DEBT/EQUITY RATIO (9)
GEARING (10)
No. OF EMPLOYEES (IN UNITS AS AT THE END OF THE YEAR)
WAGE BILL/SALES
1997 1998 1999 2000 2001
(1) For the same consolidation scope compared with 1999, the sales and the operating income amounted to EUR 1,539 million and EUR 108.4 million respectively in 1998, after taking into accountthe activities of PPG Glass Europe over the whole year.
(2) Operating income, plus depreciations, write-downs and provisions for operating risks and charges.(3) Profit before taxes, extraordinary income or expense.(4) Group’s share in the income before extraordinary income and expense, but after taxes, including the income from companies consolidated by the equity method (calculation applied separately from
the accounts).(5) The 1998 ratio has been restated to take into account the equity related to the acquisition of PPG Glass Europe.(6) Operating income after taxes (not restated) divided by capital invested at the beginning of the period. The capital invested includes tangible and intangible assets, goodwill on the assets side and the
requirement for working capital. The requirement for working capital is the difference between current assets (excluding short-term deposits and cash at bank and in hand) on the one hand and short-term debts (excluding financial debts) on the other. The 1998 result has been restated to take account of the capital employed resulting from the acquisition of PPG Glass Europe.
(7) After appropriation of the result, including minority interests.(8) Financial debts, minus net treasury. Treasury shares are not deducted from the net financial debt.(9) Ratio of the net financial debt (after deduction of funds available) to shareholder’s equity (including minority interests), after appropriation of the result.(10) Net financial debt/net financial debt plus equity.(11) Including 50% of the personnel of the Fosbel joint venture.
SALES BY GEOGRAPHICALREGION(EUR million)
NET INCOME(EUR million)
OTHER
INDUSTRIES
AUTOMOTIVE
BUILDING
OTHER
CENTRAL ANDEASTERNEUROPE
REST OFEUROPEBENELUX
RESULT OF COMPANIESCONSOLIDATEDBY EQUITY METHOD
CURRENT GROSS INCOME
EXTRAORDINARY ITEMS
TAXES
SALES BY ACTIVITY(EUR million)
ASIANORTHAMERICA
1 056.5
10.2%
185.0
87.7
(33.1)
3.3
54.6
(12.2)
37.6
(5.2)
32.3
43.5
17.5%
8.3%
8.8%
8.4%
595.2
526.8
396.0
141.7
144.4
103.5
12.4
1.27
0.67
0.40
10 025
28.4%
1 271.8 (1)
20.4%
205.1
93.5 (1)
(34.4)
4.9
59.1
(4.8)
46.5
(5.2)
41.4
45.8
16.1%
7.4%
8.6%
7.8%
696.7
541.0
608.7
159.9
363.8
96.0
12.5
1.17
0.87
0.47
12 897
27.2%
1 511.2
18.8%
219.2
106.6
(42.5)
8.4
64.1
(20.7)
33.1
(8.0)
25.2
45.3
14.5%
7.1%
8.3%
7.1%
705.2
546.2
690.5
176.1
236.3
205.9
13.3
1.16
0.98
0.49
12 841
28.6%
1 699.0
12.4%
322.6
185.4
(47.3)
8.3
138.1
(15.9)
109.1
(9.4)
99.8
133.9
19.0%
10.9%
21.2%
12.0%
780.6
630.1
620.3
281.4
186.2
144.0
13.1
1.27
0.79
0.44
12 547
26.3%
1 810.2
6.5%
385.4
234.5
(48.1)
8.2
186.4
(33.2)
138.9
(7.8)
131.1
164.9
21.3%
13.0%
26.2%
15.1%
918.5
760.6
605.6
296.5
249.2
222.5
13.5
1.47
0.66
0.40
12 709
26.2%
1 056
1 272
1 511
1 6991 810
1 056
1 272
1 511
1 6991 810
37.6 46.533.1
109.1
138.9
(11)
4
5
In a situation of economicrecession and decliningglass consumption,the Glaverbel Groupnevertheless closedfinancial year 2001with record performance.
The figures speak forthemselves:
sales up by 7%,operating result upby 26%,net result (Group share)up by 31%,return on capitalemployed of morethan 15% (1).
(1) Operating income after taxes (notrestated) divided by capital investedat the beginning of the period.
message from the chairmanof the executive committee
Apart from the Automotive division, which nevertheless confirmed its operational recovery in
2001, all the Group’s business units exceeded the profitability objective set for them, namely
a 12% ratio of EBIT to operating capital employed. This excellent performance in my view
confirms the correctness of our choice to pursue a profitable growth strategy over the past
decade, with geographical diversification and increased specialisation in products with high
added value.
The past year also saw several improvements in our processes, thanks to R&D (for automotive
and fire-resistant glass), along with the expansion of our industrial facilities, both for raw glass
(with the start-up of the float plant at Moustier and the repair of another one at Mol in
Belgium) and for processed glass (with the installation of new plant in the Czech Republic). As
a result, we have been able to consolidate our position on the European market. Finally, a
number of corporate HQ projects made decisive progress and are bearing fruits in 2002.
These include the online publication of information for construction products in a complete,
integrated module, and the remodelling of the Group’s purchasing policy.
on the way to becoming a global glassmakinggroup
Over the past ten years the Glaverbel Group has undergone a veritable metamorphosis. It
has become the only glassmaker with a presence throughout greater Europe, from Spain to
Russia, acquiring a strategic size on each of its markets, constantly creating more value and
confirming its innovative force in the glass industry. With its experience of leadership and
combining multicultural teams gained in the course of its expansion, the Glaverbel Group is
now called on to act as a driving force within a new, worldwide glassmaking group to be
formed with our majority shareholder, Asahi Glass. The formation of this new group has
become necessary due to pressure from the economic world, in which the various players are
increasingly global, especially our automotive customers. The Group is being formed by
combining all the Asahi glass activities into two worldwide in-house companies: the Flat Glass
Company and the Automotive Glass Company. The Flat Glass Company, headed by myself,
will be based in Brussels and will cover all the glass production and processing activities for
the building sector and industries sector in America, Asia and Europe. It will also centralise the
worldwide R&D activities (two R&D centres in Japan, one in North America and one in
Europe), together with Information Technology, Strategic Business Development and
Financial Reporting. The Automotive Glass Company for its part will be based in Tokyo, and
will cover all the automotive glass activities in America, Asia and Europe. An executive
committee chaired by Shinya Ishizu (President of Asahi Glass) and co-chaired by myself will
lead the process of globalisation and oversee the development of the new glass group.
6
This type of globalisation, with decision-making decentralised outside Japan and open to
foreign management, will be unique for a Japanese group.
The new organisation, effective as of April 2002, will make our group the world leader both in
raw glass, with a world market share of around 20%, and in automotive glass, where its share
should reach 30%. For Glaverbel as for its personnel, this represents a collective and indi-
vidual opportunity to progress and make our mark beyond our present boundaries, as part of
the world’s largest glassmaking group. This change opens up the way to optimising both our
know-how and our human and material resources, in developping the market and expanding
our capacity for innovation. By opening itself up to different cultures, management styles and
industrial methods, Glaverbel will be able to benefit from the best practices available within
the new global group.
prospects for 2002
The economic slowdown that has continued since the second half of 2001 has led to a fall in
demand for glass, with pressure on raw glass prices at the beginning of the year. Faced with
overproduction on the European market, the Group will bring its production volume into line
with demand. It is able to do this thanks to the flexibility offered by having a series of 15 float
plants in various parts of Europe.
Against this background, the Group expects its net result to contract slightly in financial year
2002. However, several factors will help to limit the impact of the economic downturn,
namely:
the improvements in operational performance that have begun in certain industrial niches
and in the automotive sector;
further development of products with high added value in the glass processing sector;
the start-up of new production plant, in particular in the Czech Republic.
The Group’s operating result will also be favourably influenced by the full consolidation of the
Bor Glassworks (RU) activities.
7
the Glaverbel Group’s competitive position
new global glassmaking group (1)
GLAVERBEL GROUP
BUILDING DIVISION
AUTOMOTIVE DIVISION
INDUSTRIES DIVISION
Second-largest producer of flat glass in Europe
Leader in central Europe, with Glaverbel Czech
Leader in eastern Europe, with Bor Glassworks
(Russia)
Raw glass*: second-largest producer in Europe
Architectural glass: leader in Benelux and the Czech
Republic, second position in France
Market share of around 25% in Europe, both in OEM
glass and in replacement glass
Mirrors: world leader
Thin and extra-thin glass: largest European producer
Fire-resistant glass: third-largest European producer
* Glass in large dimensions, sold “as is” or destined for processing.
MANAGEMENT
SALES
No. OF PERSONNEL
Executive committee (Chairman: Shinya Ishizu) (2)
EUR 5.6 billion (3)
36,500 (4)
Flat Glass Company
Luc Willame (1)
EUR 3.6 billion
27,500
20%
Glaverbel
AFG Industries
Asahi Flat Glass
MANAGEMENT
SALES
No. OF PERSONNEL
SHARE OF WORLD MARKET
EUROPE
NORTH AMERICA
JAPAN/ASIA
Automotive Glass Company
Jay N. Strong
EUR 2 billion
9,000
30%
Splintex
AP Technoglass
Asahi FabricatedGlass
(1) Organisation effective as of April 2002: Luc Willame will be replaced at the head of Glaverbel by Arthur Ulens,currently director of the Building Division.
(2) Other members: Luc Willame (Vice-Chairman), Jay N. Strong and Hajime Amemiya.(3) Figures based on estimates.(4) Bor Glassworks (RU) included.
8
9
financial performance
(EURMILLION)
BUILDING DIVISION2001 2000
AUTOMOTIVE DIVISION2001 2000
INDUSTRIES DIVISION2001 2000
SALES
EBIT
EBIT/OCE*
* ratio of EBIT to operating capital employed.
In the absence of anysignificant modificationin the consolidation scope,the developmentin the results for FY 2001compared with FY 2000is as follows:
990.1
190.2
23.2%
936.8
157.1
21.2%
495.3
23.8
5.6%
449.4
10.9
2.6%
311.8
51.4
18.3%
281.6
43.8
19.1%
group resultsConsolidated sales amount to EUR 1,810.2 million. Despite a fall of around 3%
in glass consumption in western Europe, this figure is up 7% under the combined effects of
higher glass sales by the Group’s three divisions, with increases of 6% for the Building divi-
sion, 10% for Automotive and 11% for Industries. These represent 55%, 27% and 17%
respectively of the Group’s sales.
The consolidated operating income (EBIT) has risen by 26%, to EUR 234.5
million. This increase is mainly due to the firming up of raw glass prices over the past two
years, together with operational improvements in various glass processing sectors.
The Building division owes its good performance mainly to:
- new production capacity in the Czech Republic (superinsulating coated glass and lamin-
ated glass);
- expanding sales of products with high added value, such as the revolutionary new
Sunergy hard-coated glass for insulation against heat and cold, and Top N superinsulating
glass which now sets the standard on the market;
- favourable prices for raw glass, despite a slight dip in the second half of the year;
- maintenance of a relatively satisfying balance between supply and demand for glass,
thanks to the measures taken to reduce production (decreasing the output of the furnaces,
and postponing the start-up of Moustier 4).
The Automotive division more than doubled its operating result, thanks to higher sales
and a greater proportion of products with high added value (Iris solar control coated wind-
shields), together with productivity gains achieved by the operational recovery plan
introduced in 2000. This plan has achieved its first tangible results on the way to restoring
profitability for the division as a whole, with the aim of achieving an EBIT/OCE ratio of 12%
as of 2004.
The Industries division continued to improve its overall performance, with its mirrors
activity holding up well and with the beginnings of a recovery in the domestic appliance
sector (Schott-Glaverbel joint venture). However it suffered the effects of technical prob-
lems and a four-week strike in Seneffe (BE). Other significant developments were the
proportionate consolidation of the Fosbel joint venture (previously consolidated by the
equity method) as a result of the change in its shareholder structure.
10
The gross operating cash flow has risen to
EUR 385.4 million, an increase of 19%, and now represents
21% of sales.
The gross current income amounts to EUR
186.4 million, up by 35%, with net financial charges in line with
the 2000 level. The Group’s ratio of indebtedness has greatly
improved, from 0.79 at the end of 2000 to 0.66 at the end of
2001, thus bringing it back to the level before the acquisition
of PPG Glass Europe in 1998.
The net financial charges represent 2.7% of sales.
The net consolidated income (Group
share) comes to EUR 131.1 million, 31% higher than in
2000, after deducting the minority interests’ share of EUR
7.8 million. This follows a 42% increase at the end of the first
half year compared with the same period in 2000.
This amount includes net extraordinary charges that are more
than double the 2000 level, at EUR 33.2 million. These
comprise the cost of discounting the former early retirement
schemes, the costs of productivity improvements planned in
2001 and 2002, various income and expenditure associated
with restructuring of the Group’s operational activities, and
further provision for the costs of implementing the recovery
plans for the Automotive division.
The net consolidated income further includes the results of
companies accounted for by the equity method, amounting to
EUR 9.5 million compared with EUR 4.4 million in 2000. This
increase is due to the growing contribution by Bor Glassworks
(RU), up from EUR 5.6 million in 2000 to EUR 9.2 million in
2001, thanks to investments in float glass production and the
expansion of the local construction market.
Capital expenditure amounts to EUR
222.5 million, up from EUR 144 million in 2000 (see “capital
expenditure”, p. 25).
In the field of employment, the Group’s workforce
amounted to 12,709 people (not counting Bor Glassworks) at
the end of 2001, compared with 12,547 in 2000.
financial operations
development of the Group’sfinancial structure *
In 2001 the Group generated a free cash flow after invest-
ments of EUR 47.3 million, compared with EUR 95.2 million in
2000. This cash flow made it possible to achieve a net reduc-
tion of EUR 30.5 million in short and long-term borrowing.
Previously, in 2000, the cash flow permitted a net reduction of
EUR 67.2 million in these same borrowings.
As a result, the Group’s debt/equity ratio at the end of FY
2001 has been reduced to 0.66, compared with 0.79 at the
end of 2000. In 2001, the net financial debt amounted to EUR
605.6 million, compared with EUR 620.3 million in 2000.
The Group’s financial structure evolved under the combined
effect of two factors:
1. achievement of a net cash flow
of EUR 296.5 million
Although it was limited by the growth of EUR 22.3 million in
the operating working capital requirement (mainly due to
stocks and orders in progress), the rise of 19.5% in the gross
operating cash flow allowed an increase of around 5% in the
cash flow before investments and financing operations in
2001. This represents an improvement of EUR 15.1 million
compared with FY 2000, when a net cash flow of
EUR 281.4 million was achieved.
2. investment financing requirements
of EUR 249.2 million
Net acquisitions of tangible and intangible fixed assets and
establishment costs amounted to EUR 237.6 million, compared
with EUR 163 million in 2000. The major part of the financing
requirement was for industrial investments (see “capital expen-
diture”, p. 25).
* See financial section, “consolidated cash flow statement”, p. 48.
11
99 00 0197 98 99 00 0197 98
DEBT/EQUITY FINANCIAL RESULTS* /SALES (in %)* Including amortisation of goodwill.
GROUP’S DEBT STRUCTURE
LT: 84%
ST: 16%
FLOATING: 51%
FLOATINGCAPPED: 30%
FIXED: 19%
EUR: 85%CZK: 15%
0.67
0.87
0.98
0.79
0.66
3.1
2.7 2.8 2.8 2.7
stabilisation of financial charges
With the exception of the charge for amortisation of goodwill,
which remained almost identical at around EUR 8.2 million, the
net financial charges were more or less stable, at EUR 40 million
compared with EUR 39 million in 2000. During the course of
2001, the Group managed to bring its net financial charges
down to 2.7% of sales.
risk management
interest rates
In order to take maximum advantage of interest rate struc-
tures, management of debt in 2001 as a whole was mainly
oriented towards a policy of financing at floating rates,
obtained largely by means of rate swaps. The risk of a rise in
rates was managed by means of hedging instruments.
In 2001, the weighted average cost of financial debt
amounted to 4.80%, compared with 4.61% in 2000.
The weighted average period of the Group’s long-term debts
has remained stable at around five years, as at the end of the
year.
exchange rate risks
The great majority of payment flows within the Glaverbel
Group is in euros. As regards the other currencies, the Group
covers the exchange rate risks mainly by forward buying and
selling of currencies, together with call and put options. The
Group’s net positions in currencies that are not linked to the
euro (mainly USD, GBP and CZK) remain limited.
Investments in the form of shareholdings in foreign companies
are not covered by exchange rate hedging arrangements. Any
currency fluctuations against the euro affecting these invest-
ments give rise to an adjustment which does not show up in the
income statement, but which instead appears in “Shareholders’
equity” under the heading “Translation adjustment”.
On 31.12.2001, the net equity of EUR 760.6 million was mainly
invested in assets in currencies that belong to the euro zone,
the main exceptions being investments in CZK and RUB,
representing 32.06% and 3.14% respectively.
fuel coverage
The Group has a policy of covering its requirements for low-
sulphur heavy fuel oil. In 2001, approximately one quarter of
fuel consumption was covered in this way (13% for the first
three quarters and 50% for the last quarter).
As of the end of 2001, the Group’s fuel requirements for 2002
were 33% covered; this ratio was brought up to 50% by the
beginning of 2002. These coverage ratios tend to vary over
the course of the year, according to variations in the market.
12
shareholder informationSHARE PRICE TREND
SHARE PRICE HIGH/LOW(SETTLEMENT MARKET) (EUR)
PRICE AT YEAR END (EUR)
STOCK EXCHANGE CAPITALISATION (EUR MILLION)
AVERAGE VOLUME TRADED DAILYON THE SETTLEMENT MARKET
IN NUMBER OF SHARES
EUR MILLION
TOTAL NUMBER OF SHARES ISSUED AT YEAR END
TOTAL NUMBER OF SHARES IN CIRCULATIONAT YEAR END
GROSS DIVIDEND YIELD IN % ON 31/12
CONSOLIDATED DATA PER SHARE (EUR)
NET CURRENT INCOME, GROUP SHARE (3)
NET INCOME, GROUP SHARE (3)
GROSS DIVIDEND
GROSS OPERATING CASH FLOW (3)
SHAREHOLDERS’ EQUITY, GROUP SHARE (4)
P/E RATIO (3) (5)
PRICE/CASH FLOW RATIO (3) (6)
PAY-OUT IN % (7)
DIVIDEND (EUR)
GROSS DIVIDEND
NET DIVIDEND
NET DIVIDEND PER SHARE ACCOMPANIEDBY A VVPR STRIP
DATE EX-COUPON
COUPON NUMBER
The dividends are payable at the following institutions: Fortis Bank, ING-BBL, Kredietbank, Petercam and Banque Degroof.
(1) Including 290,840 new shares created by conversion of convertible zero-coupon bonds.(2) See “public tender offer made by Asahi Glass”, p. 13.(3) Calculated according to the number of shares pro rata temporis, excluding treasury shares.(4) Calculated according to the number of shares extant at the close of the year, including treasury shares.(5) Price/Earnings ratio, i.e. the share price at the end of the year, divided by net current income (Group share) per share.(6) Price/Cash flow ratio, i.e. the share price at the end of the year, divided by net current income (Group share) plus depreciations, write-downs and provisions per share.(7) Ratio of gross dividend to net result (Group share) per share.
from 01/011997 1998 1999 2000 2001(2) to 31/03/02 (2)
89.24-149.98 88.50-149.98 81.50-116.50 58.05-90.00 79.75-143.00 143.00-147.20
143.78 112.79 85.70 79.75 143.00 144.50
1 018.8 799.2 607.3 565.1 1 013.3 1 023.9
6 600 5 796 3 995 4 259 9 435 21 966
0.60 0.72 0.38 0.32 0.95 3.19
7 086 023 (1) 7 086 023 7 086 023 7 086 023 7 086 023 7 086 023
2 507 521 2 507 521 2 507 521 2 507 521 2 507 521 2 507 521
2.1 2.9 4.0 4.7 2.9
1997 1998 1999 2000 2001
7.09 7.16 7.07 20.89 25.73
5.28 6.46 3.93 15.57 20.46
3.07 3.27 3.42 3.77 4.14
30.24 32.00 34.20 50.34 60.14
74.34 76.34 77.09 88.92 107.34
20.3 15.8 12.1 3.8 5.6
6.3 4.6 3.5 1.9 2.8
58.2 50.6 87.3 24.2 20.2
1997 1997 1998 1999 2000 2001interim
0.69 2.38 3.27 3.42 3.77 4.14
0.52 1.78 2.45 2.57 2.83 3.11
0.59 2.02 2.78 2.91 3.20 3.52
12/01/98 11/06/98 11/06/99 14/06/00 05/06/01 05/06/02
16 17 18 19 20 21
13
360
310
260
210
160
110
60
% 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01
SHARE PRICE TREND Capital on 31.12.2001
PUBLIC: 35.4%
TREASURYSHARES: 9.6%
ASAHI GLASS: 55.0%
SHAREHOLDING STRUCTUREON 31/12/2001 (1)
SHAREHOLDERS
ASAHI GLASS Co., Ltd.
PUBLIC
GLAVERBEL SA (2)
TOTAL
No. ofVVPR strips
shares% of
capital% ofvote
No. ofshares
On a fully dilutedbasis (3) in %
of vote and capital
(1) Before the public tender offer made by Asahi Glass (see “public tender offer made by Asahi Glass”, below).(2) The voting rights attached to the shares held by Glaverbel SA have been suspended, and it will be proposed to the AGM to suspend the dividend entitlement of
the shares held by Glaverbel SA. These shares are held to cover a convertible bond issue.(3) If all of the convertible bonds are converted into shares.
dividend
In view of the growth in results and the prospects for
2002, the Board of Directors will propose to the AGM to
pay a gross dividend of EUR 4.14 per share for FY 2001,
i.e. 10% more than for 2000. In the case of shares not
accompanied by VVPR strips, the net dividend will be
EUR 3.11 per share after deduction of the withholding tax
of 25%. In the case of shares accompanied by VVPR strips,
the net dividend will be EUR 3.52 per share after deduc-
tion of the withholding tax of 15%. The Board will
propose to make the dividend payable as of 5 June 2002
on presentation of coupon No. 21.
profit allocation
The financial year has closed with a profit of
EUR 121,124,011.62, compared with a loss of
EUR 15,661,713.19 in 2000. Taking into account the profit
of EUR 70,376,144.26 carried forward from the previous
year, and the transfer of EUR 1,214,678.27 to the untaxed
reserve, the profit available for allocation amounts to
EUR 190,285,477.61.
The Board proposes the following allocation:
Dividends EUR 26,529,057.90
Profit to be carried forward EUR 163,756,419.71
Total EUR 190,285,477.61
In case of convertible bonds being converted into shares
before the date of the Board meeting and the ex-dividend
date, the shares resulting from the conversion will benefit from
the 2001 dividend, full settlement being made on payment of
the dividend at the end of financial year 2002. The total
amount of the supplementary dividend that could result from
conversions would come to EUR 2,794,189.50 if all the bonds
in circulation were converted. At the time of publication of this
document, Asahi Glass has not taken any initiative with regard
to the convertible bonds held by it.
public tender offer made by Asahi Glass
For the purpose of reorganising into a global glassmaking
group (see “message from the chairman of the executive
committee”, p. 5), Asahi Glass announced a public tender
offer on 19.12.2001 to purchase the 35.4% of Glaverbel
shares that it did not already own. The offer, valid from
18 March to 5 April 2002, covered the 2,507,521 Glaverbel
shares with coupon No. 21 attached at a price of EUR 145
each, and the 1998/2018 convertible bonds at a price of
EUR 3,641.53 each, together with the share options. At the
close of the offer, Asahi Glass held 91.45% of the Glaverbel
shares and 98.8% of the bonds, directly or indirectly. The bid
was renewed under the same conditions from 15 April to
6 May inclusive, in accordance with art. 32 para. 1 of the Royal
Decree of 8 November 1989. At the close of this reopened
bid, Asahi Glass held 92.11% of the Glaverbel shares and
98.99% of the bonds, directly or indirectly.
The graph shows the shareholding structure according to thepercentage of shares held on 31.12.2001, i.e. before the publictender offer made by Asahi Glass (see “public tender offermade by Asahi Glass”, below).
GLAVERBELAVERAGE SHARE PRICE,BRUSSELS STOCK EXCHANGE
3 900 414
2 507 521
678 088
7 086 023
1 956 897
1 428 744
nihil
3 385 641
55.0%
35.4%
9.6%
100.0%
55.0%
45.0%
0.0%
100.0%
60.9%
39.1%
0%
100.0%
14
300
250
200
150
100
50
% 75 77 79 81 83 85 87 89 91 93 95 97 99 01
15
Demand in theconstruction andautomotive sectors ran outof steam, leading to adecline in European glassconsumption.
news of the divisions
CONSUMPTION OF FLAT GLASS IN EU COMPARED WITH GDP
CONSUMPTION (ACTUAL)
CONSUMPTION (TREND)
GDP (ACTUAL)
GDP (TREND)
research & developmentR&D expenditure by the Glaverbel Group in 2001 amounted to EUR 13.5 million.
2001 saw the development of a pilot project for an improved industrial process to produce
fire-resistant products. This technical advance enhances the optical qualities of the fire-
resistant glass, while giving it a significantly longer lifetime than competitors’ products. The
process was put into industrial operation at the end of 2001, at Olovi (CZ).
In the automotive field, R&D developed a new system for trimming the solar control coating
on the Iris windshield glass. This technique will make it possible to meet the requirements of
automotive designers, to deal with new functions such as road pricing, GPS, defrosting etc. In
collaboration with the Splintex technical centre, R&D also developed laminated side windows
that are aesthetically compatible with the Iris windshields.
In another development, a range of selective, blue-tinted glass with a very good ratio of solar
protection to light transmission was launched. This type of glass is already being used
throughout on the new Lancia Thesis.
In the field of ceramic welding, a vitreous layer that significantly reduces graphite deposits on
the walls of coking furnaces has been developed. This permits a large reduction in the
frequency of maintenance.
At the beginning of 2002, R&D introduced its first “Glaverbel Chem’Award” for final-year
students in Belgian universities, with prizes of EUR 2000 and EUR 3000 respectively for the
best graduate and doctorate theses in chemistry.
16
99 00 01
building division
SALES (EUR million)
EBIT (EUR million)
RATIO OF EBIT TO OPERATINGCAPITAL EMPLOYED
WORKFORCE
SALES TREND(EUR million)
2000 2001
990.1
190.2
23.2 %
6 388
936.8
157.1
21.2 %
6 381
990.1936.8
791.2
raw glass
excellent performance by high added valueproducts
The slowdown in the economy that was already perceptible by the end of 2000 became
accentuated as of the third quarter of 2001. Demand in the construction and automotive
sectors ran out of steam, leading to a decline in European glass consumption for the first time
since 1993, from 7,000,000 to 6,800,000 tonnes, a decrease of around 3% from one year to
the next. Despite significantly greater pressure on prices in the last quarter of 2001, these
remained relatively stable over the year as a whole, at a level that was higher on average than
in 2000.
By contrast, products with high added value such as laminated safety glass and superinsu-
lating coated glass continued their expansion, spurred on by stricter legal requirements for
thermal insulation, as in France, together with growing interest in better insulation and safety.
In this difficult situation, Glaverbel lost some of its sales volume while consolidating the posi-
tions acquired during the past few years. Sales of patterned glass stood up well, while
laminated glass performed excellently, with a record volume of shipments from Athus (BE),
while superinsulating coated glass achieved growth that was significantly higher than the
market average. The latter two products benefited at just the right time from the new capacity
installed at Retenice (CZ), which is now the largest integrated raw glass plant in Europe.
The revolutionary new Sunergy glass for its part exceeded the objectives set for its first year of
marketing. This hard-coated glass combines high solar protection with good thermal insula-
tion, while at the same time having a neutral colour and low reflection, making it particularly
sought-after by architects. Its unique combination of properties has enabled the Group to
increase its lead in the segment of solar control coated glass.
Finally, 2001 saw the start-up of a fourth float plant at Moustier (BE) in a joint venture with
Scheuten Glasgroep (NL), together with the repair of the float plant at Mol (BE), which in addi-
tion to its initial specialisation of thin glass now also produces automotive glass. These two
plants now give the Glaverbel Group greater flexibility for production of specialties.
17
a difficult start to the year
The previous year’s trend continued into the first part of 2002,
with shrinking demand, excess production capacity in Europe
and unfavourable weather conditions all combining to put
prices under heavy pressure. In expectation of an upturn in the
second half of the year, the Group is ready with:
a rich range of products and recent operational invest-
ments, enabling it to continue its expansion in growth
sectors with high added value (safety glass, superinsulating
glass and solar control glass);
ambitious developments in the field of e-business, to
streamline relations with strategic customers;
further plans for improving quality and safety.
architectural glass
higher results,contrasting performance
Sales indicators and profitability for the Group’s architectural
glass activities were both up, despite contrasting performance
on the different markets.
The results in Belgium were in line with expectations, where
the market was stable.
In France, the results of the subsidiaries fully confirmed the
recovery in their operating performance which had already
been apparent over the past two years.
In the Netherlands, by contrast, the downturn in the building
industry led the Group to carry out an in-depth reorganisation
of its activities, with a national organisation being set up for
the architectural subsidiaries and the Dutch market being
divided up on a regional basis. This reorganisation should give
the Group a stronger identity on the Dutch market and permit
more efficient coordination of the subsidiaries.
Finally, Glaverbel Czech acting through its subsidiaries
continued to develop its position on the central European
markets, in particular Poland, despite the increased competi-
tion.
a year of investment
2001 also saw a significantly higher level of investments than
in previous years. These included the reorganisation of the
production flow in Belgium, the industrial reorganisation of
the Glavostav plant in Retenice (CZ), and the installation of
tempering and screenprinting facilities in France. The Group
also decided to install a new magnetron at Lodelinsart (BE),
which specialises in production of coated solar control glass
for large construction projects around the world. This invest-
ment, totalling nearly EUR 35 million, will consolidate the
Group’s leadership in vacuum coating for production of solar
control glass.
Confident in the effects of its reorganisation in the
Netherlands, the positive impact of these investments and the
further extension of its product mix in 2002, the Group
expects good results for 2002 as a whole.
18
99 00 01
automotive division
SALES (EUR million)
EBIT (EUR million)
RATIO OF EBIT TO OPERATING CAPITALEMPLOYED
WORKFORCE
SALES TREND(EUR million)
2000 2001
495.3
23.8
5.6 %
2 952
449.4
10.9
2.6 %
2 968
495.3449.4456.0
profitability recovers
The European market was stable in 2001, with slight expansion of 0.6%, as the dynamism of
the British, French and Spanish markets made up for the slowdown in Germany and the
Netherlands. Splintex managed to increase its sales significantly, benefiting from its good
position with regard to successful new models such as the Peugeot 307 and 607 and the
Toyota Yaris.
The growing proportion of shipments made up by products with high added value (such as
the Iris windshields), along with the first tangible effects on productivity resulting from the
“Three Years to Win” plan, led to significant profitability gains for all the division’s production
sites. The “Three Years to Win” plan is aimed at raising the division’s ratio of EBIT to oper-
ating capital employed to 12% by 2004. It has already risen from 2.6% in 2000 to 5.6% in
2001.
2001 also saw the introduction of a uniform computerised management system; as of
1 January 2002, all the division’s sites use the same nomenclature and the same production,
logistics and accounting software. The flows for the entire division are now centralised at the
European logistics and invoicing centre located at the division’s new headquarters in Seneffe
(BE). The old headquarters, at Fleurus (BE), has now become a technical centre where all the
technical competencies necessary for developing new products are concentrated.
the new challenges
Facing an expected contraction of around 5% in the European market, Splintex is counting on
a radical boost being given to its products, with the Rover Mini, Peugeot 307 and Renault
Laguna II all coming into full production and new models such as the Opel Vectra, Nissan
Primera, Lancia Kappa, Peugeot V etc. being launched. The continued growth in sales of the
Iris coated windshields should also help to sustain the operational recovery that began in
2001. Another challenge that will have to be faced in the medium term will be to reconcile the
demands of ever-shorter development cycles on the one hand, with large numbers of new
vehicle models being introduced, and increasingly strict quality requirements on the other.
19
towards better performancefor Splintex Distribution
The market for automotive replacement glass proved to be
stable in 2001. Splintex Distribution experienced a large
increase in sales due to a major competitor having difficulties
in getting a distribution centre started up. This led to a serious
imbalance in its stocks, with a costly increase in the number of
short production runs, which had a negative impact on the
profitability of this activity.
The recurring losses made by Splintex Distribution in the UK
prompted the business unit to shut down this branch in
January 2002.
However, the results should improve in 2002, thanks to the
continued increase in the level of service offered by the
European distribution centre in Cuneo (IT), along with the
coming on stream of the new Czech production unit special-
ising in production of replacement windshields.
20
99 00 01
industries divisionSALES (EUR million)
EBIT (EUR million)
RATIO OF EBIT TO OPERATINGCAPITAL EMPLOYED
WORKFORCE
SALES TREND(EUR million)
2000 2001311.8
281.6249.6
281.6
43.8
19.1 %
2 296
311.8
51.4
18.3 %
2 471
Vertec BUunsatisfactory performance
There was sustained market demand for all types of thin glass, except for LCD glass, whichstarted to decline at the beginning of 2001 and continued its downward slide in the followingmonths.Sales were lower than forecast in this segment. Together with the limited run-down in stocksof thin glass with high added value in 2000, which had been built up to cover the repair of theMol furnace, this led to mediocre results for the business unit, both in terms of sales volumeand in terms of profitability.The improvements in the industrial and commercial situation at the beginning of 2002 havemade it possible to restart the major development and diversification projects previouslydrawn up for Mol (BE) and Shenzhen (CN).
mirrors BUconvincing results for unprocessed mirrors
After experiencing a very good year in 2000, the unprocessed mirrors activity managed toimprove its results still further in 2001. This significant progress was due to among otherthings:
the growth in sales volumes in central and eastern Europe;
the very good prices during the first half year, although there was gradual erosion fromSeptember onwards;
the very large increase in sales of special products;
better control of production costs, despite the higher cost of raw materials such as silverand in particular palladium during the first half year;
the consistent marketing approach, supported by geographically balanced productionresources within Europe, with all sites making products of the same quality.
The decline in prices continued at the beginning of this year, so that the business unit will notbe able to repeat last year’s performance in 2002. Nevertheless, it is confident of being ableto show a good performance in future, thanks to its worldwide reputation for its products, itsservice and its technology. This will be further assisted by the commercial and industrialimprovements expected from a reorganisation based on an innovative concept for managinginformation and the flow of mirrors, which will be applied to all the production sites.
mixed performance by processed products
2001 was a disappointing year for processed glass and mirrors for the furnishings industry, espe-cially as regards Mirodan (BE), which suffered from the downturn in its main markets. On the other
21
hand, the Kryry (CZ) unit continued on the growth path that it hasfollowed for the past three years. With the forecast recovery inmarkets for products with high added value, the business unit’sresults should be up to expectations once more in 2002.
satisfactory results for rear-viewmirrors
Miroiterie Hirtz (FR) benefited from its good position on theexpanding French and Spanish markets. This together withthe productivity gains achieved in 2001 enabled it to limit thedownturn in its results caused by price pressure from vehicleparts suppliers.The results should pick up once more in 2002, thanks tofurther improvements in industrial performance. Also, whileprices are still under pressure at the moment they should holdup better.
industrial products BUcontrasting developments forfire-resistant glass
Operating in a steadily expanding market, the Seneffe (BE)plant reached the limits of its production capacity. It then raninto technical problems, which together with a four-weekstrike had a negative impact on overall performance. On theother hand, activities in the Czech Republic exceeded theirobjectives, thanks in particular to the start-up of the newproduction unit at Olovi.
With this new capacity, the business unit should be able tobenefit fully from the strength of the market, especially ineastern Europe and overseas, where new opportunitiesbeckon. This growth will be supported by programmes forraising productivity and quality, with the help of R&D.
general pick-up in performanceby special glass
In the field of special glass, in particular glass with high addedvalue for the transport sector (trains, ships etc.), the reorganisa-
tion begun at Seneffe at the end of 1999 gave a new boost toresults, which however were below the ambitious objectivesoriginally set. The business unit also benefited from the excel-lent performance by the Aniche (FR) workshop and thepromising start-up of the Glaversun* joint venture in Padua (IT).
The new assembly capacity at Glaversun will make it possibleto redeploy the activities of the business unit, which in a situa-tion of sustained demand in 2002 should benefit the results.
* Joint venture with the Sunglass company, which specialises in glasscurving.
ceramic welding BU
results strongly up
Despite the slowdown in the economy that also affected thissector, the business unit’s results improved markedly in 2001,thanks to ceramic welding* operations.
2001 also saw the signature of new agreements betweenFoseco and Glaverbel concerning the Fosbel joint venture,which is responsible for marketing the ceramic weldingprocess around the world. These agreements, which cameinto effect in 2001, have introduced 50/50 management of thejoint venture instead of 51/49 as previously, thus givingGlaverbel a more active role in the conduct of the business.
* Process developed by Glaverbel for hot repair of furnace refractories.
appliance glass BUThe Schott-Glaverbel joint venture with its eight subsidiaries inEurope and Brazil managed to bring about a clear recovery in itsoperations, thanks to various productivity improvementprogrammes. The concomitant progress achieved by SchottIndustrial Glass (GB) made up for the negative effects of theeconomic downturn on the results of Schott-Glaverbel do Brasil(BR). The upward trend should continue in 2002, helped by thenewly-revamped Termofrost (SE) production facilities.
22
23
01(2)00999897
After a decade ofexpansion, Glaverbel hasbecome a multiculturalgroup extendingfrom southern Europeto Russia. Although the cultural differenceswith the post-communisteconomies were sometimesprofound, they havenevertheless beenrespected as expressionsof national identity.
investments for the future
BELGIUM
BREAKDOWN OF PERSONNELBY GEOGRAPHICAL REGION (1)
At year endNETHERLANDS
FRANCE
CZECH REPUBLIC
ASIA
ITALY
SPAIN
OTHER
human resourcesAt the same time, however, they have been transcended by adopting shared values that
apply to everyone, such as empowerment, communication and flexibility. These in turn have
led to shared working methods in which the values are expressed and given form. For
example, the efforts made towards empowerment, communication and flexibility at every
level are all measured in the same way, whatever the country, using a single method for
assessing individual performance, which in turn is used to draw up individual training
programmes. Other methods shared by all the entities within the Group add up to form a fully
integrated model for managing the managers and executives, with a remuneration policy
comprising fixed and variable components, an ongoing training programme and a fore-
casting system for human potential in the form of a “potential map”. This model will have two
new online tools added to it in 2001, namely a careers module and a skills module.
The careers module is one of the most highly-developed in today’s employment market, with
a website presenting the Group’s HR policy, the various disciplines and the associated
employment opportunities, together with an application procedure in no fewer than seven
languages. This user-friendly tool enables vacancies to be posted and applications processed
online, permitting decentralised, Europe-wide job management.
The skills module for its part has been developed in-house, in the form of a shared software
package for all the companies in the Group. Two pilot versions have been introduced for the
benefit of the blue-collar workforce at Mol (BE) and Splintex Czech respectively, with the ulti-
mate goal of bringing skills into line with requirements for each particular job on an objective
basis, through appropriate training.
In accordance with the policy of promoting meetings and direct consultation between
management, personnel and labour unions, a round of information meetings was held in all
the countries where the Group has an industrial presence. At these meetings, the chairman
and members of the Executive Committee were able to hold discussions with executives,
personnel representatives and the unions. In parallel with this round of meetings, the first
plenary session of the European Works Council, named “Euroforum Glaverbel”, was held in
Brussels in June 2001. This body has 60 members drawn equally from both sides of industry.
Since it was set up, three meetings of the select committee have also been held.
In 2002, the experience acquired by Glaverbel HR in multiculturalism will play an essential role
in the functioning of the new, global glassmaking group.
(1) Not counting Bor Glassworks (see p. 27).(2) Including 50% of the personnel of the Fosbel joint venture.
12 8
97
12 8
41
12 5
47
12 7
09
10 0
25
24
communicationThe Group’s European network of communication managers
permits constant exchange of information and generates
professional synergies, making it possible to optimise commu-
nication methods and channels and giving the Group an
effective voice at local level.
Thanks to this network, the Group was able to complete a
number of important new projects in 2001. These included:
Giving the Iris corporate newsletter a makeover and
putting it online, so as to benefit from the functionalities
inherent in electronic communication.
Restructuring GlaverSite (the Group’s intranet) and giving it
a new look, thus making it easier to share and consult
corporate, national and local information by putting it
online.
Adding new modules to the corporate website
(www.glaverbel.com) dealing with R&D, careers at Glaverbel
and the Glaverbel Chem’Award, and developing the
Glaverbel Czech website.
Creating a new visual identity for Bor Glassworks (RU) and
its subsidiaries, as the visible expression of Group member-
ship.
environment, safetyand quality
environment
In collaboration with Group Purchasing, a project for compre-
hensive waste management was introduced in 15 of the
Group’s plants, in Belgium, the Netherlands and France. The
aim is not only to reduce waste management costs but also to
minimise the amount of waste that has to be disposed of, by
making greater use of recycling.
A new fume scrubbing system was installed at Mol (BE) in
2001, and two more have been ordered for Moustier (BE) and
Cuneo (IT), together representing a total investment of
EUR 6.5 million. In the field of mirror production, a second
system for breaking down volatile organic compounds was
installed at Kryry (CZ). Meanwhile, all the sites in the
Automotive division have benefited from investments in waste
water purification, leading to large reductions in discharges of
materials in suspension.
In Russia, Bor Glassworks completed its environmental
programme in 2001. Begun in 1997, this was aimed at
bringing the plant’s environmental performance up to the
same standard as the Group’s other plants.
Finally, Ethibel, a recognised authority in ethical investment,
included Glaverbel in its list of “ethical shares”, thanks in
particular to the Group’s environmental policy which goes
beyond the legal requirements.
25
99* 00 0197 98
* New consolidation scope, following the mergerwith PPG Glass Europe.
CENTRALEUROPEWESTERNEUROPE
OTHER
CAPITAL EXPENDITURE(EUR million)
96.0
205.9
144.0
222.5
103.5
safety and quality
Safety and quality are recognised as key factors in the devel-
opment of the Group. The deterioration in safety results in
2001 led the Executive Committee to introduce a Group-wide
campaign to reverse the trend. The objective is to achieve the
same accident rate* irrespective of the activity or the country
where it is carried out. The programme, which will of course
take national regulations into account, will be supported by an
all-round communication campaign aimed at getting
everyone involved, in particular plant management and line
management.
As regards quality, this is now managed by the Divisions and
Business Units of the Group, as the result of a process of
progressive decentralisation. Significant developments were
the obtention of ISO 9001 certification by Glaverbel Seneffe
(BE) and ISO 9001 certification (version 2000) by Glaverbel
Nederland and Rapid Pane in the Netherlands, and by
Glaverbel Liberglav, Fenestra, Batiglav and Glavol in the
Czech Republic. The latter plant has also obtained ISO 14001
certification. Finally, Splintex Czech is the first company in the
Group to obtain certification for the most extensive standard
of them all, namely IMS QES (Integrated Management
System, Quality, Environment, Safety).
* Accident rate = frequency × seriousness
capital expenditureCapital expenditure amounts to EUR 222.5 million, up from
EUR 144 million in 2000. The main items were:
construction of the fourth float line at Moustier (BE), which
started up in October;
installation of new processing plant in the Czech Republic
(for production of laminated and fire-resistant glass, and
increased mirror capacity);
completion of the revamping operation at the Boussois
(FR) plant in September;
repair of the Mol (BE) float plant, which started up again in
March 2001.
In 2002, the Group will carry out some EUR 220 million of
capital investments, targeted at raising productivity and
consolidating its position on certain markets. These invest-
ments will be financed out of cash flow, and will mainly
concern:
repair of the float plants at Cuneo (IT), Moustier (BE) and
Bor Glassworks (RU);
installation of a new magnetron sputtering unit for
producing coated solar control glass at Lodelinsart (BE);
installation of a tempering furnace at the Splintex plant in
Roccasecca (IT).
26
Bor GlassworksBor Glassworks is the largest Russian producer of flat glass by
the float process (two lines with a total capacity of around
1,100 tonnes per day) and of automotive glass (capacity of
around 900,000 sets of windows per year).
Glaverbel holds a stake of 36.4% in Bor Glassworks and acts as
the industrial operating partner at the head of a shareholder
consortium whose other main members are the IFC and EBRD
development banks. The consortium controls more than 85%
of Bor Glassworks.
Glaverbel has granted options to the other members of the
consortium, for them to sell their shares in Bor Glassworks
(representing 48.9% of the shares). These put options have
exercise periods ranging from 2003 to 2007, at prices based
on the profitability of Bor Glassworks.
good year in 2001
Russia continued to perform very well in macroeconomic terms
in 2001, with real GDP up by around 5%. After large growth in
2000, industrial output and exports nevertheless slowed down
in 2001, while imports increased by around 20%, fuelled by the
rise in the value of the rouble over the past two years.
The financial performance achieved in 2001 by Bor
Glassworks and its main financial aggregates are summarised
below. This information is taken from the company’s audited
financial statements as at 31 December 2001, drawn up in
accordance with international accounting standards (IAS)
which take the impact of inflation into account.
Growth in the supply of flat glass on the Russian market in
2001 was caused in particular by the expansion in Bor
Glassworks’ own production capacity. This in turn was due to
the fact that no float lines were closed for cold repair in 2001,
while the capacity of the No. 2 float line increased as a result
of the repair carried out in 2000. There was also growth in
imports. The combined effect of these factors led to an
increase of stocks at Bor Glassworks, which in any case was
necessary to prepare for the cold repair of the No. 1 float line,
which will be shut down for six months in 2002.
Despite the growth in the supply of flat glass on the market,
prices of float glass grew in comparison with the average level
in 2000 after taking the impact of inflation into account.
In the field of automotive glass, Bor Glassworks experienced a
stabilisation in prices and shipment volumes in 2001 compared
with 2000.
Finally, there were significant increases in various production
costs in 2001, in particular for certain raw materials and
energy.
Overall, the company’s net result grew strongly compared
with 2000, although it was influenced to a large extent by the
non-recurring write-back of some provisions for deferred
taxes, amounting to RUB 203.4 million as calculated according
to International Accounting Standards. This was done in order
to take account of the reduction in the rate of corporate
income tax to 24% in 2002.
The contribution made by Bor Glassworks to the Group’s
consolidated result amounted to EUR 9.2 million. The
combined effects of inflation and the rise in the rouble against
the euro generated a positive translation adjustment,
contributing an increase of EUR 6.3 million to the Group
equity.
The main investments made in 2001 were:
the project to install a new laminated glass production line
in a new hall, with a production capacity of 800,000 wind-
shields per year;
the installation of new software packages (SAP modules,
sales management software and production management
software), together with software training.
99 00 0197 98
27
(1) Exchange rate on 31.12.2001: EUR 1 = RUB 26.49. The same exchange rate has been applied for 2000, with the figures duly inflated to make them comparable with 2001.(2) Figures inflated by 18.7%, corresponding to the rate of inflation in Russia for 2001.(3) Operating income + depreciation and amortisation.
NUMBER OF PERSONNELAt year end
BALANCE SHEET (thousands)
TANGIBLE AND INTANGIBLE FIXED ASSETS
NET CURRENT ASSETS
PROVISIONS AND DEBTS
SHAREHOLDERS’ EQUITY
INCOME STATEMENT(thousands)
SALES
GROSS MARGIN
OPERATING INCOME
NET RESULT
GROSS OPERATING CASH FLOW (3)
31 December 2001 31 December 2000RUB EUR (1) RUB Inflated (2) EUR (1)
31 December 2001 31 December 2000RUB EUR (1) RUB Inflated (2) EUR (1)
6 3046 009
5 3654 930
4 535
4 118 101 155 459 3 591 333 135 573
370 089 13 971 298 497 11 268
873 696 32 982 1 103 744 41 666
3 614 494 136 447 2 786 086 105 175
3 054 704 115 315 2 451 270 92 536
1 176 713 44 421 1 059 592 40 000
648 051 24 464 742 523 28 030
828 408 31 272 484 094 18 275
866 599 32 714 921 129 34 773
prospects for 2002
The most important factors that will influence the performance
of Bor Glassworks during the course of 2002 include:
the shut-down for repair of the No. 1 float line for around
6 months, which will eventually raise its capacity from 450
to 600 tonnes per day;
further installation work of the new laminated glass produc-
tion line for the automotive industry. This is due to start up
in July 2002 and will be fully operational by the beginning
of 2003;
various investments in the glass processing and distribution
network in Russia.
However, the possible weakness of the international economy
could have an impact on the Russian market, putting pressure
on the Bor Glassworks operating margins.
Furthermore, the financing of the above-mentioned projects
will probably mean higher net financial charges.
Together, these factors presage a lower level of current results
for Bor Glassworks in 2002 compared with the previous year.
L u c W i l l a m eChief ExecutiveOff icer
A r t h u r U l e n sVice-President,Bui lding Divis ion
M i c h è l e G i l l o tVice-President,Human Resources &Communication
Yves SchoonejansVice-President, Finance
P i e r r e C h e n uVice-President,Industr ies Divis ion
G u y M a u g i sVice-President,Automotive Divis ion
J a c q u e s R y s m a nIndustr ia l Director,Raw Glass
A n d r é H e c qVice-President,Research & Development
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directors, managers and auditors
composition of the Board of Directors(on 31.12.2001)
Name Expiry date of Main activity Membershipterm of office of committees
Members representing the main shareholder
Shinya Ishizu May 2002 Chairman of the Board; President of Asahi Glass RC (1)
Hajime Amemiya May 2003 Chief Technology Officer, Asahi Glass;Executive Vice-President of Asahi Glass
Katsuyoshi Kawaharazuka February 2002 (2) General Manager HR Planning, Asahi Glass
Takashi Matsuzawa May 2004 Head of Finance and Accounting, Asahi Glass
Shuhei Nakamura May 2002 Chief Representative Officer, Asahi Glass AC (1)
Takashi Wada May 2003 General Manager of Corporate Planning, Asahi Glass
Members representing the management
Luc Willame May 2003 Vice-Chairman of the Board; Chief Executive Officer
Yves Schoonejans May 2006 Vice-President, Finance
Independent members
Baron Bodson May 2007 President of Diamant Boart, Barconet, Source Power Net &Free Fair Post Initiative AC, RC
Herman Daems May 2006 President of GIMV and Barco AC
Michel Delloye May 2007 Managing Director of Cytifinance SA
Honorary members
Robert Toussaint
René Wauman
(1) AC = Audit Committee, RC = Remuneration Committee(2) Resigned on 25.02.2002 and was replaced on that date by Mayasuki Kamiya, coopted by the Board of Directors.
executive Committee of the Glaverbel Group
Luc Willame Chief Executive OfficerPierre Chenu Vice-President, Industries DivisionMichèle Gillot Vice-President, Human Resources & CommunicationAndré Hecq Vice-President, Research & DevelopmentGuy Maugis Vice-President, Automotive DivisionJacques Rysman Industrial Director, Raw GlassYves Schoonejans Vice-President, FinanceArthur Ulens Vice-President, Building Division
auditor
Arthur Andersen, Company Auditors, represented by Guy Wygaerts.
30
corporate governance
In accordance with recommendations by the Belgian market authorities regarding the “best
practice” to be observed in matters of corporate governance, the Group implemented
various procedures, resulting in the following situation:
responsibilities of the Board of Directors
The Board of Directors is the company’s highest management body. It controls the financial
situation of the company. It approves the six-monthly and annual accounts, as well as the
consolidated accounts. The Board defines the strategic objectives of the company. It examines
the investment plans on a case by case basis, and approves important projects.
It is responsible for all decisions that go beyond day-to-day management, and for all devel-
opment, reorganisation and restructuring projects. It approves the resources to be employed
for attaining these objectives.
composition of the Board of Directors
The Board of Directors assures adequate representation of the interests of all shareholders.
On 31 December 2001 it had 11 members, made up as follows: six representatives of the
majority shareholder Asahi Glass Corporation Ltd., three independent directors and two
members of the Executive Committee.
The directors are appointed in accordance with the provisions of the Articles of Association for
a maximum period of 6 years; their period of office is not automatically renewed. The age limit
for membership of the Board is 75 years. No appointments committee has been set up,
because the directors representing the majority shareholder are appointed internally by it.
Furthermore, the resignation or reappointment of independent directors is dealt with as a
special item on the agenda of the Board of Directors.
There are no other particular rules differing from the provisions of the Companies Code.
As regards independent directors, they are co-opted by the other directors, according to
their skills.
functioning of the Board of Directors
The Board of Directors may only debate the items on the agenda, and then only if at least half
of its members are present or represented. Any director may, by simple letter, telegram or
fax, appoint another member of the Board to represent him and vote in his name.
31
One director may represent several others. Any director may
participate in Board meetings, express opinions and vote by
telephone, teleconferencing or any other modern means of
communication, provided at least two directors are present in
person at the place stated in the convening notice. If an artifi-
cial person is elected as director, it must appoint a physical
person to exercise the functions of the directorship.
Resolutions are taken by a simple majority of votes. In case of
a tie, the vote of the person chairing the meeting is prepon-
derant.
In the case of inability of a director to attend meetings or take
part in the vote in accordance with article 523 of the
Companies Code, the required quorum is considered as
present if it was already so before the director’s departure,
and resolutions can be validly taken by a majority of the
remaining directors. In case of an emergency and in the inter-
ests of the company, the Board is able to carry out its
deliberations in writing in accordance with article 521 of the
Companies Code.
During the past year, the Board of Directors met three times.
Apart from strategic and one-off decisions, it regularly exam-
ined reports on the development of the Group, its business
units and main subsidiaries, as well as matters concerning
human resources and risk management.
There is a clear separation between the responsibilities exer-
cised by the Board of Directors and those of the Executive
Committee.
Moreover, the company set up a reporting system several
years ago, concerning the day-to-day management and the
situation of subsidiaries and shareholdings; the reports are
available to all directors, who receive summaries on the occa-
sion of Board meetings and Audit Committee meetings. The
most significant information is communicated to directors in
the form of spreadsheets and budgets.
Further, all directors have access to the advice and services of
the secretary to the Board, who is responsible for procedures
relating to the operation of the Board and compliance with
regulations.
Notwithstanding the fact that the positions of Vice-Chairman
of the Board and Chief Executive Officer are held by the same
person, the independence of the Board is guaranteed by the
presence of experienced, independent directors with recog-
nised authority.
Former directors may be given the title of honorary director by
the general meeting of shareholders; as such they may be
invited by the Chairman or Vice-Chairman of the Board of
Directors to participate in its deliberations in a consultative
capacity.
The total remunerations awarded to directors amounted to
EUR 42,241.06 for services rendered from 31.05.2000 to
29.05.2001, and to EUR 59,991 for services to be rendered
between 30.05.2001 and 28.05.2002. The members of the
Board and of the Executive Committee do not have any
personal interest in transactions carried out by Glaverbel SA of
an unusual nature or under unusual conditions, and do not
benefit from any loans or guarantees accorded by the
company.
No director of Glaverbel SA holds registered shares in the
company.
There are no particular rules for holding the office of director.
audit Committee
In order to prepare the work of the Board of Directors and
assist it in carrying out its functions, an Audit Committee has
been set up within its membership. This committee, made up
of three non-executive directors, the majority of them inde-
pendent, is tasked with assisting the Board in its supervisory
32
duties. To this end, it analyses in particular all financial infor-
mation communicated to the Board, receives the audit plan,
and closely monitors the evaluation of risks. The external
auditor, internal auditor, chief financial officer and secretary to
the Board regularly attend meetings of the Committee. The
Audit Committee meets at least twice per year, and its deci-
sions are taken by unanimity of votes. The Audit Committee
met four times in 2001. Its chairman reports to the Board of
Directors. On 31 December 2001 the members of the audit
committee were Messrs. Shuhei Nakamura, Philippe Bodson
and Herman Daems.
day-to-day management
The Board of Directors has entrusted day-to-day management
of the company, together with the task of representing the
company in connection with this management, to Mr. Luc
Willame, who bears the titles of Managing Director and Chief
Executive Officer.
The Executive Committee is responsible for day-to-day
management of the company. It proposes strategic options to
the Board of Directors, and defines specific policies.
The Executive Committee, which acts collectively, meets
weekly.
The total amount paid to members of the Executive
Committee was EUR 2.2 million. A large proportion of this
amount (around 25%) is variable and is linked to performance,
in terms of EBIT (earnings before interest and taxes) compared
with the budget and the previous year’s figure, and in terms of
ROCE (return on capital employed) compared with the objec-
tive.
The members of the Executive Committee participate in the
company’s stock option plan which was set up at European
level for senior managers in the Group. 54,240 options were
granted to members of the Executive Committee, out of a
total of 150,000.
remuneration Committee
A Remuneration Committee has been set up, comprising
Messrs. Shinya Ishizu and Philippe Bodson. This committee
formulates recommendations on the remuneration of the CEO
and of the Executive Committee members. The Remuneration
Committee meets once per year during the month of March;
other meetings may be held as necessary.
profit allocation policy
(See “shareholder information”, p. 12)
relations with the majorityshareholder
There are collaboration agreements between the majority
shareholder and Glaverbel in the field of research & develop-
ment. However, all dealings between Glaverbel and its
majority shareholder are carried out at arm’s length. The inde-
pendent directors systematically examine all transactions
between Glaverbel and the majority shareholder; this exami-
nation is carried out in particular by the Audit Committee.
relations between shareholders
We do not have any knowledge of compacts between share-
holders.
equivalence of shares
The capital of Glaverbel SA is represented exclusively by ordi-
nary shares. There are no preference shares or founders’
shares. The voting rights of the 678,088 shares acquired as a
result of the merger by absorption of the company Savoir
Verre SA have been suspended in accordance with article 622
of the Companies Code. The Group does not have any cross-
holdings with its shareholders.
.
GlaverbelGlaverbelwww.glaverbel .com
Glaverbel Group166, ch. de La Hulpe - B-1170 BRUSSELSTel.: +32 2 674 31 11 - Fax: +32 2 672 44 [email protected] - VAT: BE-413.638.187