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ANNUAL REPORT 2011
Hydratec Industries NV
Nijverheidsweg Noord 40
Postbus 328
3800 AH Amersfoort
The Netherlands
Telephone: Int. + 31 (0)33 469 73 25
Telefax: Int. + 31 (0)33 469 73 14
E-mail: [email protected]
Internet: www.hydratec.nl
Registered offi ce in Amersfoort, the Netherlands, and listed in the Commercial Register
of the Amersfoort Chamber of Commerce under number 23073095.
Disclaimer: this international annual report 2011 serves as an indicative and shortened
version of the offi cial Dutch annual report 2011, which is published on the company’s
website www.hydratec.nl. In case of contradictions, the Dutch version shall prevail.
1 HYDRATEC INDUSTRIES NV
2 Profi le and organisation 3 Agri & Food Equipment
3 Pas Reform Hatchery Technologies
4 LAN Handling Systems
5 Man Machine Interfaces
5 Danielson Europe
6 Plastics
6 Timmerije
7 Euro Mouldings
8 Major events in 2011
9 Key fi gures
11 Strategy and fi nancial targets
12 The Hydratec Industries share 13 Foreword from the CEO
14 Supervisory Board 15 Report of the Supervisory Board 18 Management Board
19 Report of the Management Board19 Growth and acquisition strategy
20 Business development during 2011
20 Financial developments
21 Dividend proposal
22 Developments per activity
22 Agri & Food Equipment
23 Man Machine Interfaces
24 Plastics
26 Health, safety and environment
26 Personnel and organisation
26 Risk management
28 Corporate Governance statement
28 In control statement
29 Outlook and expectations for 2012
29 A word of thanks
30 Summarised annual accounts 201131 Consolidated profi t and loss account
32 Consolidated statement of comprehensive income
33 Consolidated statement of changes in shareholders’ equity
34 Consolidated balance sheet
35 Consolidated cash fl ow statement
36 Five year summary
38 Contact details
2 PROFILE AND ORGANISATION
Profi le
Hydratec Industries NV (Hydratec) is an industrial holding company of companies that supply high-quality
products and systems and occupy strong positions in the following market segments:
the global agri-and food markets;
the European Man Machine Interface (MMI) applications market;
the Benelux and German plastic products and packaging industries.
Man Machine Interfaces (MMI) PlasticsAgri & Food Equipment
3
Pas Reform is an international company that offers innovative total solutions for the
hatchery industry. Since its founding in 1919 the Company has expanded into one of
the world’s largest hatchery systems suppliers. Pas Reform is active in the following
product groups:
industrial incubators for the production of uniform, robust day-old chicks;
hatchery automation systems for the effi cient processing of hatching eggs
and day-old chicks;
climate control equipment for sustainable and hygienic air and water treatment.
Pas Reform has extensive experience with providing advice regarding these systems and with
their design, installation and operation.
At the heart of the company is the Pas Reform Academy which, in close co-operation with
clients and universities, carries out research into the infl uence of the incubation process on
embryo development.
This specialist expertise is used to develop new, innovative products and services for the
hatchery industry and to train and guide hatchery managers.
Pas Reform exports to more than hundred countries. Sales and service activities are carried
out via the head offi ce in Zeddam and a joint venture in Brazil. Pas Reform also has its own
sales offi ces in Malaysia and Indonesia and an extensive network of local partners and agents.
The products are distributed all over the world from the logistics centre in Doetinchem.
Pas Reform employs 79 people who focus primarily on the development, sale, fi nal assembly
& installation, and service of the hatchery systems.
www.pasreform.com
Pas Reform Hatchery TechnologiesAGRI & FOOD EQUIPMENT
Pas Reform, with a presence in over hundred countries, is one of the world’s leading incubator manufacturers.
4
LAN has specialised in the handling of packaged food and pharmaceutical products during
the sterilization process since 1970. LAN’s systems are client-specifi c and form the connection
between fi lling machines, sterilisation boilers and packing machines in a production line.
They are used to position, pick up and move products of various sizes and shapes and made
from a variety of materials. This enables the most complex packaging to be processed in
every required quantity.
Recently LAN expanded its product range to include automation systems for the effi cient
processing of hatching eggs and day-old chicks.
LAN’s strength is its project-based approach to the execution of large and complex systems:
inventive robot technologies and mechanical solutions are combined with advanced control
technologies to achieve a production line that works perfectly. This demands intensive
co-operation within the project teams and with the client. This is why LAN’s organisation
and operations revolve around teamwork and partnerships with clients.
Most of LAN’s revenue is generated outside the Netherlands. Its loyal clients include
multinationals such as Mars, Nestlé Purina, Campbell’s, Kraft and Del Monte.
The systems are developed and assembled by sixty employees in the facility in Tilburg.
Due to the client-specifi c character of the projects the heart of the company is formed by
the engineering department where specialists design the systems’ mechanical, electrical
and control technologies. Manufacture of the components is contracted-out. LAN’s own
specialists then assemble, test and install the system.
www.lan-hs.com
LAN Handling SystemsAGRI & FOOD EQUIPMENT
LAN specialises in the handling of packaged food and pharmaceutical products.
5
Danielson develops, manufactures and builds innovative electronic control panels that
enable complex machinery to be operated in demanding environments. In its market
approach Danielson’s priority is the needs of its clients and every solution is designed to the
client’s specifi cations. Danielson’s clients are machinery and equipment builders in the
medical sector and manufacturers of industrial automation equipment.
Thanks in part to its client-oriented approach, in which Danielson’s specialists advise clients
at an early stage in the development process, Danielson occupies a top position in the
European market. Danielson’s objective for the coming years is to strengthen this position
still further.
Danielson develops control panels in the form of membrane switches, rubber keypads,
piëzo switches and touchscreens. The company’s innovative strength is apparent in every
component of the solution: from the simple switch to complex electronics. In all these fi elds
Danielson ranks among the top in terms of both innovation and quality. The capacitive
touchscreens recently developed in-house are a clear example of this.
Danielson, with 185 employees, serves the entire European market. The company has two
production facilities in Hardenberg (NL) and Aylesbury (UK). To ensure clients are provided
the optimum service sales engineers responsible for maintaining direct contact with clients
are located in Europe’s main industrial centres.
www.danielsoneurope.com
www.danielson.co.uk
Danielson is one of the top suppliers of man machine interfaces in Europe.
Danielson EuropeMAN MACHINE INTERFACES
6
Timmerije is an ISO / TS 16949 certifi cated full-service manufacturer of technologically
complex plastic injection-moulded components. Timmerije’s machine park includes fi fty
injection-moulding machines, with pressures varying from 25 ton to 1,200 ton, and state
of the art 2K injection moulding, gas injection, insert moulding and in-mould decoration
techniques.
As a ‘Custom Moulder’ with around hundred employees, its own engineering department
and its own tool maker, Timmerije achieves outstanding quality for its clients.
Delivering quality and working with the client to fi nd solutions are in the company’s DNA.
Timmerije’s integrated, professional approach to product and process development and
extensive expertise and experience result in smart and sustainable solutions for its clients.
The sustainable use of materials and the reduction of waste are key criteria.
Timmerije’s engineering services include product development, material selection, mould
fl ow / FEA studies, prototyping, matrix design, automation and value engineering. Timmerije
also offers additional services such as assembly, painting, coating, printing, ultrasonic
welding and delivery up to and including the packaging. Timmerije’s logistics organisation
ensures fl exibility in supply and a high degree of delivery reliability.
www.timmerije.com
Timmerije is a leading designer and manufacturer of high-quality plastic products in the Benelux.
TimmerijePLASTICS
7
Euro Mouldings manufactures blow moulded plastic packaging. A combination of
acquisitions and organic growth has enabled the company, which was founded in 1995
as Euro BV, to build-up a wide range of packaging. Currently the factory in Nijverdal,
the Netherlands, has 38 blow moulding machines which produce products ranging from
20 millilitre bottles to 30 litre jerry cans. Many of the bottles and containers carry the
so-called UN-label, which indicates that they are suitable for transporting hazardous
materials.
The wide product range means many different markets can be served including the
automotive, chemicals, food, cosmetics and agricultural sectors. The majority of the products
are made of High Density Polyethylene (HDPE). The range includes both ‘standard’ products
manufactured using Euro Mouldings’ own moulds and client-specifi c packaging.
New products are continuously being developed (either independently or to fulfi l an order
from a client). The focus here is on improved functionality, logistics advantages, weight-
savings and image.
Euro Mouldings strives to generate added-value in the fi eld of logistics for its clients. Most of
the products are available from stock. In view of the voluminous nature of the products the
timing of deliveries is very important.
Most deliveries are to clients in the Netherlands, Germany and Belgium. The German market
is easily accessible for Euro Mouldings.
The combination of development capacity for new packaging and logistics added-value is
summarised in Euro Mouldings’ mission: ‘We stock your design‘.
With around sixty employees Euro Mouldings is a reliable, fl exible and client-oriented
supplier of plastic packaging.
www.euromouldings.com
Euro Mouldings is a specialised supplier of client-specifi c plastic packaging.
Euro MouldingsPLASTICS
Despite diffi cult macro-economic developments all the activities contributed to the profi t for 2011.
The acquisition of the Lias activities (Agri & Food Equipment) at the end of 2011 has brought Hydratec NV activities in a third market segment.
Hydratec’s growth potential has increased substantially to include global markets.
Annual revenue for 2011, including the newly acquired activities, amounted to over € 120 million.
Profi t per share rose to € 3.07 (2010: € 1.49) due to the consolidation of the results of the acquired activities as of 1 September 2011.
Virtually no dilution of the Hydratec share because the acquisition was paid almost entirely in cash.
After the acquisition Hydratec’s solvency ratio amounted to 36.9%.
MAJOR EVENTS IN 20118
9Amounts in thousands of euros unless stated otherwiseKEY FIGURES
2011 2010
Profi t and loss account
Net revenue 84,190 55,137
Operating profi t 5,523 3,073
Net profi t 4,159 2,144
Net profi t to be allocated to shareholders 3,631 1,765
Cash fl ow
Cash fl ow from operating activities 10,888 1,661
Cash fl ow from investing activities – 18,304 – 10,295
Cash fl ow from fi nancing activities 733 – 1,869
Net cash fl ow – 6,683 – 10,503
Balance sheet
Shareholders’ equity 24,387 21,165
Group equity 27,420 22,875
Balance sheet total 74,386 36,992
Key ratios
Operating profi t as a % of revenue 6.6% 5.6%
Return on invested capital / 1 8.7% 8.2%
Return on shareholders’ equity / 2 15.9% 8.5%Solvency / 3 36.9% 61.8%
Number of issued shares 1,222,143 1,183,094
Profi t per share (in euro) 3.07 1.49
Diluted profi t per share (in euro) 2.97
Number of employees at year end (FTEs) 488 339
1 / Net profi t + interest charges as a % of the average invested capital (total assets minus cash and cash equivalents minus current, non-interest bearing liabilities).
2 / Net profi t as a % of the average shareholders’ equity.3 / Group equity as a % of the balance sheet total.
Net revenue
2010 2009
100,000
2011
80,000
60,000
40,000
20,000
0
84,190
55,137
17,322
Net profit
2010
2009
5,000
2011
4,000
3,000
2,000
1,000
0
3,631
1,765
– 590
Operating profit
2010
2009
7,500
2011
6,000
4,500
3,000
1,500
0
5,523
3,073
– 1,223
Average number of employees
2010 2009
500
2011
400
300
200
100
0
381
330
158
Profit per share (in euros)
2010
2009
5
2011
4
3
2
1
0
– 1
3.07
1.49
– 0.50
Group equity
2010 2009
30,000
2011
24,000
18,000
12,000
6,000
0
27,420
22,875
20,861
Amounts in thousands of euros unless stated otherwise10
Financial targets
Hydratec strives to achieve an operating profi t of at least 10% of revenue. This profi t target can,
however, temporarily fail to be achieved primarily as a consequence of economic conditions and
due to the reorganisation of acquired, less profi table, companies.
Together with the envisaged growth and healthy solvency Hydratec strives for a dividend
distribution amounting to at least 40% of the profi t after taxes (excluding any one-time income).
Strategy
Hydratec is an industrial holding company with majority interests in a number of different
business activities. The strategy is aimed at achieving consistent, long-term revenue growth
and stable results with all Hydratec companies. This must offer our shareholders the prospect
of a good return.
Motivated management
It is very important that everyone of the companies has a good and motivated management
team that optimises market positions and results in a practical and realistic manner. This is
assured by ambitious, but realistic, targets that form a guideline for everyone involved through
well-founded scenarios.
The Management Boards of our companies are integrally responsible for their own operating
activities. All business aspects are discussed during the regular consultation meetings between
Hydratec’s Management Board and the Management Boards of the operating companies.
These discussions are based on a clear framework of regular reports and practical co-ordination
regarding tactical and strategic objectives. This enables a fast and alert response to opportunities
and threats.
Active entrepreneurship
Because the activities of the different groups are very varied there is no basis for central staff
departments, which means overhead costs are limited to the minimum. Business operations are
based on the high degree of target-oriented, no-nonsense management within which active
entrepreneurship and stimulating leadership can fl ourish best.
11 STRATEGY AND FINANCIAL TARGETS
Financial data per ordinary share
Amounts in euros unless stated otherwise
2011 2010
Number of issued shares 1,222,143 1,183,094
Operating profi t 4.52 2.60
Shareholders’ equity 19.95 17.89
Profi t per share 3.07 1.49
Diluted profi t per share 2.97 –
Available cash fl ow / 1 – 6.07 – 7.30
Dividend 1.20 1.00
Price at year end 18.05 15.00
Lowest price 14.70 12.40
Highest price 19.98 16.25
1 / Operating cash fl ow minus investment cash fl ow.
Stock market listing and market capitalisation
Hydratec’s shares are listed on NYSE Euronext Amsterdam (ISIN NL 000 939 1242).
The total number of issued shares as at 30 December 2011 changed due to a private issue of
39,049 shares. As a result the total number of shares rose to 1,222,143.
Disclosure of Major Holdings Act
The following interests governed by the Disclosure of Major Holdings Act are known (corrected
for the number of shares as at 1 January 2012):
Shareholder Interest Date of disclosure
Mr. E. ten Cate 79.5% 23 March 2011
Zoomers Beheer BV 6.0% 1 November 2006
Financial calendar 2012
Announcement of annual results 22 March
Trading update fi rst quarter 15 May
General Meeting of Shareholders 31 May
Publication of half-year fi gures 26 July
Trading update third quarter 15 November
12 THE HYDRATEC INDUSTRIES SHARE
New Management Board member
At the end of 2011 Hydratec expanded its activities considerably through the acquisition of an
88.5% interest in Lias Industries, to which Pas Reform Hatchery Technologies and LAN Handling
Systems belong. Pas Reform, the most important activity, is a global supplier of industrial incubators.
Over the past few years Bart Aangenendt, the Managing Director, has developed Pas Reform into
one of the top-three companies in this fi eld in the world. I am delighted that he has joined the
Management Board of Hydratec NV. He will continue to be responsible for the Lias activities.
Growth is a shared responsibility
In just a few years Hydratec’s annual revenue has risen from several tens of millions from two
companies to more than € 120 million from fi ve companies in three market segments. Despite
this growth we have continued, and will continue, to adhere stringently to our fundamental
principle that the responsibility for business operations within the companies rests with the
people who have direct contact with the clients and understand their primary business processes.
We consider ourselves lucky to have at our disposal management teams who carry out these
tasks with great dedication and who take a personal interest in their employees.
Investing and innovating
I remain optimistic because the current situation also creates opportunities for companies which,
particularly at this time, can continue investing and innovating. Danielson is on the threshold of
totally new, developed in-house technological product positions. Timmerije has received many
new orders recently and Euro Mouldings is also serving new clients in an innovative way. And if
the world (and especially the less well developed markets) wants to continue feeding its citizens
a great many new incubators will have to be installed! I would like to express my thanks to the
employees in all our companies for their efforts and fl exibility. A year in which our clients’
demands changed so quickly and so often put more demands on everybody to remain client-
oriented and to come up with creative solutions. We are proud that so many of our employees
responded so positively to the challenge. This instils confi dence in the future!
Roland Zoomers CEO
2011 was an exceptional year for Hydratec NV and its companies. After the robust growth of
2010 we expected revenue development to stabilise at more normal levels. During the fi rst
months of the year, however, the revenue just kept on increasing. Because the fi xed costs of all
the companies had already been reduced, during the fi rst half of 2011 good operating profi ts
were achieved despite relatively high raw materials prices. On the basis of this, when the
half-yearly fi gures were published we forecast that we could achieve robust profi t growth
over the whole of 2011.
Lias Industries activities acquired
During the summer this expectation changed due to rapidly worsening macro-economic factors
and a loss of confi dence on the European capital markets. Clients put the brakes on, which had
immediate consequences for our order books and revenue levels and, as a result, our profi ts.
These developments meant that during the second half of the year our operating profi ts fell.
This situation was offset by the consolidation as of 1 September, and therefore the contribution
towards the results, of the newly acquired activities of Lias Industries. Thanks to this, ultimately
both the total revenue and profi t were higher than for 2010.
Key success factor
We are making no predictions for 2012. If we have learned one lesson from the past it is that
market sentiments and economic factors can change very quickly and, therefore, so can the
demand for our products. This implies that only the organisations that can adapt to changing
conditions quickly and effectively will be successful and remain competitive. This has always been
the case, but the speed with which changes take place has increased. More than ever before the
key success factor is: Adapt and anticipate what will happen, minimise unpredictability and
respond to the unexpected with cunning and power! Because market developments are
unpredictable the fl exibility of the organisation has become a very important success factor.
We believe our companies have the necessary fl exibility. This is a constant challenge for our
management teams and an important basis for our investment decisions.
13 FOREWORD FROM THE CEO
From left to right: Jan Vaandrager, Egbert ten Cate and Henk Kienhuis.
14
E. ten Cate (1945) Chairman
First appointed: 2000
Current term ends: 2012
Current position: director Bank ten Cate & Cie NV
Supervisory Board memberships/other positions held
Supervisory Board member, Koninklijke Ten Cate nv
Chairman of the Supervisory Board, Rijksmuseum Twente
Supervisory Board member, Medisch Spectrum Twente
H.A.A. Kienhuis (1945) Vice-chairman
First appointed: 2011
Current term ends: 2015
Last position held: lawyer and attorney
Supervisory Board memberships/other positions held
Vice-chairman, Stichting Edwina van Heek
Supervisory Board member, Iesselholtinck BV
Member of the Board, Stichting Continuïteit Reesink NV
J.E. Vaandrager (1943)
First appointed: 2011
Current term ends: 2015
Last position held: member of the Board and CFO, TKH Group NV
Supervisory Board memberships/other positions held
Supervisory Board member, HITT NV
Supervisory Board member, B.E. Semiconductor Industries NV
All the Supervisory Board members are Dutch nationals.
SUPERVISORY BOARD
15
the Supervisory Board. His fi nancial background and broad knowledge of the manufacturing
industry are valuable for Hydratec. In 2012 Mr. Ten Cate will have served three terms of four
years as a member of the company’s Supervisory Board. Although the best practice stipulations
of the Corporate Governance Code recommend a maximum of three terms, the Supervisory Board
is of the opinion that Mr. Ten Cate’s profi le fi ts extremely well with the Supervisory Board and
is unique in view of his expertise and experience related to the creation of today’s Hydratec.
Mr. Ten Cate is also a major shareholder and, as such, plays an important role in the stability of
the company. For these reasons the Supervisory Board intends, as an exception, to recommend
that Mr. Ten Cate is re-appointed for a fourth term of four years.
Supervision and meetings
During 2011 fi ve scheduled meetings were held with the Management Board. Prior to the
General Meeting of Shareholders of 1 June 2011 the Supervisory Board, in the absence of the
Management Board, evaluated the functioning of the Management Board and its own Board.
Acquisition of Lias Industries BV
During 2011 several extra meetings were held with the Management Board in connection with
the acquisition of Lias Industries. The Chairman of the Supervisory Board, Mr. E. ten Cate, was
not present during these meetings due to his involvement with Lias Industries. In this context
a protocol regarding his confl ict of interest was also drawn-up and signed by Mr. Ten Cate,
the other members of the Supervisory Board and the members of the Management Board on
3 February 2011. On the appointment of the new members of the Supervisory Board this
protocol was revised and reaffi rmed. The most important points of this protocol were:
Mr. Ten Cate will not participate in the Supervisory Board’s discussions and decision
making regarding the transaction.
From the moment at which Hydratec decides to conduct discussions regarding the
transaction until the moment at which (i) the transaction is fully completed or (ii) it
is clear that the transaction will defi nitely not take place, discussions and decision
making relating to the transaction within the Supervisory Board will only take place
during Supervisory Board meetings not attended by Mr. Ten Cate.
The Supervisory Board is delighted with the result achieved in the 2011 fi nancial year. Although
revenue and profi t were under pressure during the second half of the year, the net profi t (before
third party shares) of the existing activities rose to € 2.2 million. As a result of the acquisition
of 88.5% of the shares in Lias Industries BV, the fi gures of which were consolidated as of
1 September 2011, the net profi t (before third party shares) for 2011 amounted to € 4.2 million,
an increase of 94% compared with 2010.
Annual report
We hereby submit to the shareholders the 2011 annual report, including the annual accounts,
of Hydratec Industries NV prepared by the Management Board. These annual accounts have
been audited and certifi ed by the external auditor, BDO Audit & Assurance, and discussed by us
and the Management Board on 21 March 2012 in the presence of the auditor. The auditor’s
declaration is included on page 66 of the offi cial Dutch 2011 annual report, which can be found
on the company’s website www.hydratec.nl. On these grounds we are of the opinion that the
annual report meets the specifi cations for transparency and forms a good basis for the
Supervisory Board’s accountability in respect of its supervision.
We recommend that you adopt the annual accounts, approve the dividend proposal and
discharge the Management Board for its management and the Supervisory Board for its
supervision during 2011.
Composition of the Supervisory Board
At their own request Messrs. G.P. van Dobben de Bruyn and L.P.E.M. van den Boom resigned
as members of the Supervisory Board as of 4 July 2011. We are extremely grateful to them for
their contribution towards the supervision of the company during their terms of offi ce. We are
delighted that the two vacancies in the Supervisory Board have now been fi lled. During the
Extraordinary General Meeting of Shareholders on 17 October 2011 Mr. H.A.A. Kienhuis was
appointed as Vice-chairman of the Board. Mr. Kienhuis’ legal background and experience as a
company lawyer are important for Hydratec. During the Extraordinary General Meeting of
Shareholders on 27 October 2011 Mr. J.E. Vaandrager was also appointed as a member of
REPORT OF THE SUPERVISORY BOARD
16
During this period Mr. Ten Cate will receive no information regarding the transaction
from the Hydratec side.
During the Extraordinary Meeting of Shareholders in which the transaction must be
approved Mr. Ten Cate will not participate in the deliberations and voting regarding
the transaction.
Mr. Ten Cate will not be directly involved on the Lias side with the negotiations
carried out by the Management Board on the Hydratec side.
This acquisition was approved during the Extraordinary General Meeting of Shareholders on
30 December 2011. Mr. Ten Cate was not present and, in conformance with the above protocol,
cast blank vote regarding the acquisition of 88.5% of the shares in Lias Industries.
During its meetings the Supervisory Board discussed the strategy, acquisition policy, risk
management, quarterly and half-yearly results, 2010 annual fi gures and 2012 budget.
The business progress of the various subsidiaries was also discussed as was the effect of the
economic crisis on the markets in which the Hydratec companies operate. The Board endorses
the importance of the Management Board’s intention to pay considerable attention to the
integration of the Lias Industries companies Pas Reform and LAN in 2012.
Corporate Governance
The Supervisory Board endorses the objectives of the guidelines contained in the Dutch Corporate
Governance Code for stock exchange listed companies. In view of the size of the organisation
and the number of Supervisory Board members no separate committees have been formed.
Currently Mr. E. ten Cate is the only member of the Board who does not meet the independence
criteria as laid-down in paragraph III. 2.2, clause e of the Code. More information regarding the
company’s position can be found on www.hydratec.nl.
Composition of the Management Board
There were no changes to the composition of the Management Board during the 2011 fi nancial
year. As Lias Industries’ activities now account for a major portion of Hydratec’s overall activities
Mr. B. Aangenendt (General Manager of Lias Industries and Pas Reform) was appointed to the
Management Board as of 1 January 2012. From that moment the statutory management Board
of Hydratec Industries NV has comprised Mr. R. Zoomers and Mr. B. Aangenendt.
Remuneration of the Management Board
An agreement, that expires on 1 September 2015, has been reached with the CEO, Mr. R. Zoomers.
This agreement covers all the company’s obligations in respect of fi xed salary and pension
agreements. Should this contract be terminated by the company before the agreed date the
recompense will amount to one year’s salary. A bonus directly linked to the operating profi t for
the 2011 fi nancial year has been agreed. The Supervisory Board has now agreed a bonus linked
to the operating profi t over the 2012 fi nancial year.
As of 1 January 2012 Mr. B.F. Aangenendt has been appointed a member of the Management
Board for a fi rst term of up to four years. He will remain a member of the Management Board
of Lias Industries BV and Pas Reform BV and his employment agreement with these companies
remains valid. All the agreements laid-down in this employment agreement will be continued.
In the context of his appointment as a statutory Director of Hydratec Industries NV, a bonus
directly linked to the operating profi t will also be agreed with Mr. Aangenendt.
Report of the Supervisory Board
Remuneration policy
The Supervisory Board of Hydratec Industries NV follows a remuneration policy for the company’s
Management Board based on the following principles:
The Management Board remuneration policy must enable good managers
to be recruited and retained.
The remuneration policy must be in accordance with the company’s Corporate
Governance policy.
The remuneration must be compatible with the strategic and fi nancial targets and be
performance-oriented, whereby there should be a good balance between short-term
and long-term results and/or targets.
The remuneration may not include any incentives aimed at the recipients own
interests and in confl ict with the interests of the company.
The possible outcomes of the remuneration policy are evaluated annually.
The remuneration of the members of the Management Board is specifi ed in Note 1.25 on
page 66 of the offi cial Dutch 2011 annual report, which can be found on the company’s
website www.hydratec.nl.
In conclusion
The Supervisory Board is grateful to the Management Board, the management teams and
all the employees for their efforts and dedication during 2011 and the results achieved
in a challenging year.
Amersfoort, 12 April 2012
Supervisory Board
E. ten Cate Chairman
H.A.A. Kienhuis
J.E. Vaandrager
Report of the Supervisory Board17
Roland Zoomers (1950)
First appointed: 2002
Current term ends: 2015
Shareholding in Hydratec NV: 6.0%
Bart Aangenendt (1964)
First appointed: 2012
Current term ends: 2016
Shareholding in Hydratec NV: 3.2%
Both members of the Management Board are Dutch nationals.
From left to right: Bart Aangenendt and Roland Zoomers.
MANAGEMENT BOARD18
19
The recent successful development of Pas Reform can be explained as follows:
In 2004 and 2010 the company introduced new generations of single-stage
incubation systems. These are offered as a total solution in combination with
Pas Reform Academy (in-house training for clients). Exporting innovative
technologies and expertise has, in recent years, enabled Pas Reform to position
itself as a specialist in this niche market and, based on this, build-up a strong,
global network of trading agents.
Growth and acquisition strategy
Hydratec has for some time had superfl uous liquidity, mainly as a result of the sale of the
Nyloplast activities in October 2008. Hydratec’s ambition was to expand its activities once
again and, in that context, at the beginning of 2010 acquired a 75% interest in two plastics
companies – Timmerije and Euro Mouldings. As there were insuffi cient concrete possibilities
to acquire business activities against attractive conditions within the existing product-market
segments Hydratec also deliberately sought other industrial activities. This led to the acquisition
of an 88.5% interest in Lias Industries BV (Lias), the holding company of Pas Reform BV and
LAN Handling Systems International BV. Over the past few years Pas Reform, the largest Lias
business activity, has developed successfully and is now a leading supplier of industrial incubators
with an annual revenue of around € 50 million.
Important positive reasons for Hydratec to make this acquisition were:
Pas Reform is one of the world’s largest suppliers of industrial incubators and the
related hatchery automation systems and climate control equipment. Based on
its extensive experience with providing advice regarding and the development,
marketing and installation of these systems, in recent years Pas Reform has achieved
substantial growth. Pas Reform has around 75 employees.
Most of the manufacture of the incubator components is contracted-out to specifi c
suppliers, many of them in Eastern Europe. As a result Pas Reform has a relatively
small permanent organisation and can respond quickly and fl exibly to changes in
demand. Orders from clients comprise projects involving the supply of all the
hatchery equipment which is then assembled and installed on-site at the client’s
premises. Currency translation risks are limited because virtually all the invoicing
is in euros.
REPORT OF THE MANAGEMENT BOARD
Pas Reform’s stand at the ‘VIV Europe’ show in Utrecht.
20
As a component of the transaction 3.5% of the acquired Lias shares were paid for in Hydratec
shares, for which 3.3% of the total initial share capital was issued.
The acquisition of this interest in Lias Industries at the end of 2011 has expanded Hydratec’s
size and activities substantially. This means we are now focusing primarily on expanding and
reinforcing our current business activities. Should opportunities that would structurally
strengthen or improve the current business activities arise, specifi c acquisitions will be considered
very seriously.
Business development during 2011
The revenue and gross margin for 2011 were € 84.2 million and € 37.1 million respectively.
Lias’ revenue and margin during the period September to December 2011 were € 23.9 million
and € 7.4 million respectively. Without the contribution of Lias revenue would have increased
by 9%.
Financial developments
The operating profi t for 2011 amounted to € 5.5 million, which was 6.6% of the revenue
(2010 operating profi t: € 3.1 million). Without the contribution of Lias operating profi t would
have amounted to € 3.4 million.
Expertise and experience in the fi eld of incubator technologies is scarce – the market
is relatively small with only a few players worldwide. Since 2000 Pas Reform has
invested in its own organisation and has recruited and retained people with the
specifi c skills needed to make the transition from machine builder to system and
knowledge supplier.
The global incubator market has a limited number of suppliers. Pas Reform ranks
among the top-three and is recognised as an innovative company. Pas Reform’s direct
competitors are hardly any larger and the remaining competitors are far smaller.
This means Pas Reform can profi t optimally from the increased demand for modern
incubators.
In recent years the consumption of chicken has risen faster than the consumption of
beef and pork. The expectation is that this trend will continue and that Pas Reform
will profi t from this development.
The reasons behind this robust growth in consumption are:
Increased welfare in relatively poor (emerging) countries has meant higher meat
consumption in these regions.
Poultry products are relatively cheap and easy to produce.
Chicken is healthier than red meat and there are no religious restrictions on chicken
consumption.
Poultry meat can be produced more cheaply and sustainably than beef or pork
because a chicken requires far less food than a pig or cow to produce one kilo of
meat. This stimulates investments in industrial hatcheries in fast-growing markets.
The purchase price of the acquisition of Pas Reform was around € 18.3 million, € 17.6 million
of which was paid in cash. The fi rst instalment of € 13.2 million was paid at the time of the
acquisition on 30 December 2011. The remainder will be paid after the approval of Lias’ 2011
annual accounts at the end of May 2012 at the latest. Hydratec paid virtually all the purchase
price in cash: around € 6 million from its own means and the remainder through a bank loan.
Report of the Management Board
‘At the end of 2011 the scale and scope of Hydratec’s activities were expanded substantially.’
21
Financial income and expenses
In 2011 net interest charges amounted to € 108,000 compared with € 156,000 in 2010. Due to
the acquisition of the Lias activities, on 30 December 2011 the Group’s fi nancing structure changed
because the acquisition was fi nanced partly through a bank loan.
Fiscal effects
The effective tax rate over 2011 was 23.2% compared with 26.5% in 2010. The lower rate was
due partly to the utilisation of the innovation box regulation.
Net profi t
The net profi t for 2011 amounted to € 3.6 million after deducting the third party share of
€ 528,000 (2010: € 1.8 million).
Cash fl ow
In 2011 operational cash fl ow amounted to € 10.9 million (2010: € 1.6 million). Cash fl ow from
investing activities amounted to € 18.3 million negative, of which a net € 15.9 million was
related to the acquisition of an 88.5% interest in Lias. Net cash fl ow from fi nancing activities
amounted to € 733,000. This was the result of the bank loan of € 4.4 million, the dividend
distribution of € 3.1 million and loan repayments amounting to € 352,000.
Dividend proposal
It will be proposed to the General Meeting of Shareholders that a dividend of € 1.20 per share
be paid for the 2011 fi nancial year (2010: € 1.00 per share). This sum will be paid in cash.
The profi t for 2011 will be added to the other reserves. This dividend distribution is in line with
the policy of paying out 40% of the profi t after taxes.
Report of the Management Board
22
In 2011 Pas Reform’s revenue rose by 60% compared with the previous year. The substantial
increase in sales of incubators, hatchery automation systems and climate control equipment,
especially during the fi rst half of the year, enabled Pas Reform to strengthen its international
market position still further.
Technological innovation, the optimisation of business processes and new partnerships with
clients and suppliers contributed towards these good operating results. The introduction of a new,
sustainable, generation of incubators in 2010 bore fruit and improvements in the fi eld of client
services gave Pas Reform a good starting position in the market. In addition, there was increasing
appreciation from the market for the Pas Reform Academy, which translates clients wishes into
new hatchery products.
Suppliers needed some time to respond to the increased demand, which meant delivery times
lengthened considerably at the beginning of the year. Delivery times were brought back to more
normal lengths during the summer and the third quarter. At the beginning of 2011 a new
distribution centre in Doetinchem went into operation, which improved the logistics substantially.
In 2011 a new sales offi ce was opened in Indonesia. Pas Reform had already opened a sales offi ce
in Malaysia. In 2011 the joint venture in Brazil, established in 2008 with a local partner to serve
this important market, acquired its fi rst locally-produced projects.
Although the subsidiary LAN Handling Systems BV achieved a good project turnover, its results
were not satisfactory due to disappointing price levels. A start was made on the development of
specifi c handling equipment for the poultry industry.
Developments per activityAgri & Food Equipment: Pas Reform Hatchery Technologies and LAN Handling Systems
€ x 1,000 2011 2010
Revenue 61,938 33,903
Gross margin 20,825 12,574
Depreciation and amortisation 449 252
Investments 665 170
Operating profi t 5,048 3,784
Number of FTEs at year end 144 61
1 / Figures for the entire year for information purposes; only the fi gures for the period 1 September to 31 December are consolidated in the annual accounts.
2 / 2010 excluding LAN Handling Systems.
/ 2 / 1
Report of the Management Board
Pas Reform’s new distribution centre in Doetinchem.
23
During the fi rst half of 2011 Danielson Europe managed to continue profi ting from the always
high market demand. After the summer Danielson also began feeling the effects of the economic
situation as demand from its most important markets dropped slightly. Despite this, Danielson’s
revenue for the whole of 2011 was 7.8% higher than for 2010. This resulted in an operating
profi t amounting to 8.5% of revenue.
During the year the organisational structure was amended with the most important consequence
being that Danielson now has a smaller and more effi cient management team. This team is now
also totally responsible for the activities in England.
In Hardenberg a second production area went into service, which increased the factory area by
around 25%. This was needed to create more space for the substantially increased demand for
touchscreens.
The higher profi t is partly thanks to earlier investments in quality improvements and effi ciency.
The super-fast laser, which went into service during the fi rst months of 2011, played a major role
in this. With the help of 5S-methodology a number of departments were re-equipped, which has
resulted in further logistics and effi ciency improvements.
In September Danielson was able to introduce its new generation touchscreens. These new
products are based on the so-called projected capacity technology and have a glass surface
and multi-touch capabilities. This technology, which is derived from consumer electronics
(iPhone, iPad etc.), is expected to really take off for industrial applications as well.
To safeguard Danielson’s pioneering role in the market, in mid 2011 a project was started aimed
at further broadening Danielson’s expertise in the fi eld of new innovative touchscreens and the
related electronics.
Further progress was also made in the environment and sustainability fi eld. The quantity of waste
has been reduced still further and the new heat-recycling plant has led to signifi cant energy savings.
Man Machine Interfaces: Danielson Europe
€ x 1,000 2011 2010
Revenue 23,073 21,411
Gross margin 12,314 11,042
Depreciation and amortisation 559 564
Investments 513 497
Operating profi t 1,971 1,372
Number of FTEs at year end 169 180
Danielson’s products are tailor-made for the client.
Report of the Management Board
24
Both the Plastics companies also profi ted from an increased demand for their products during
the fi rst half of the year. Materials costs account for a large portion (around 60%) of the total
cost price of the products of both these companies. The continuing increases in raw materials
prices during the fi rst half of 2011 could not be passed-on immediately, which resulted in lower
gross margins. As this effect was offset by the increased revenue, in absolute terms the operating
profi t was higher than in the same period in 2010. Both companies supply the Dutch and German
manufacturing industries and, due to the severe economic uncertainty, from the summer onwards
saw order levels across a broad front being adjusted downwards. As a result, during the second
half of 2011 revenue and operating profi t were lower. Despite this the operating profi t for the
whole of 2011 was higher than for the previous year.
Plastics: Euro Mouldings and Timmerije
€ x 1,000 2011 2010
Revenue 37,254 33,726
Gross margin 17,411 16,448
Depreciation and amortisation 1,366 1,313
Investments 1,692 1,566
Operating profi t 2,237 1,993
Number of FTEs at year end 174 157
Report of the Management Board
Euro Mouldings manufactures blown plastic packaging.
25
Euro Mouldings’ manufacturing capacity was increased to cope with the increased demand and
a partial fi ve-shift service was implemented.
At Timmerije Wim Simons was appointed as a new member of the Management Board in April
2011. His years of experience in the injection moulding industry means Wim Simons has brought
with him valuable expertise.
Both companies search continuously for possibilities to re-use plastics. Most of the so-called
manufacturing waste is immediately re-used in the on-going manufacturing process. In addition,
continuous research is carried out and possibilities found to use recycled plastic in new products.
Although, in most cases, this does not generate cost advantages it does lead directly to a more
sustainable use of raw materials.
Timmerije specialises in technologically-complex products.
Report of the Management Board
‘Only those organisations that can adapt quickly and effi ciently to changing conditions will be successful.’
26
Risk management
Hydratec Industries NV’s growth, acquisition and new activities
The growth of its revenue and results is at the core of Hydratec’s strategy. We endeavour to
achieve this by a combination of the organic growth of every company and selective acquisitions.
We believe that continuous growth is necessary for a healthy business development and stimulate
our companies to improve their competitive positions by achieving product improvements and
innovations. Product developments are, however, based primarily on identifi ed concrete
requirements of clients and potential clients.
Hydratec wishes to strengthen its market positions, gain synergy advantages and gradually
expand its revenue and geographical area of operations through acquisitions. Hydratec also
remains abreast of opportunities in sectors in which it is not yet active. This can mean that
Hydratec acquires activities in new markets in which it does not have a proven track record
of experience and/or expertise.
This growth strategy may also require investments that cannot always be fi nanced from our
own resources and available credit facilities. It may, therefore, be necessary to call on the capital
market and/or shareholders. Maintaining a strong solvency ratio is, therefore, an important basis
for continuity.
Health, safety and environment
Controlling, and where possible reducing, absenteeism through sickness remains a constant
concern. Paying continuous attention to employees, and in particular their working conditions,
is especially important for industrial companies. Not only to minimise absenteeism but also to
guarantee maximum safety within the production processes. Virtually every industrial process
involves environmental risks. Limiting these risks is an extremely important area of attention
for the management teams. Environmental risk assessments are, therefore, carried out at the
production facilities on a regular basis and, if necessary, lead to the immediate implementation
of measures and procedures to reduce the risks still further. Increasingly the processes are also
checked for possibilities for improving the sustainability of our products and/or production
processes. This aspect will become increasingly important. Not only to offset the ever higher
energy prices, but also because we expect increasingly stringent requirements in this fi eld will
be specifi ed by our clients.
Personnel and organisation
As at the end of 2011 the workforce had risen from 339 to 488 FTEs of which 141 FTEs were
due to the acquisition of Lias’ two companies in Zeddam and Tilburg. As a principle we strive for
strong local organisations with a high degree of entrepreneurship and a sense of responsibility
for all business processes. The personnel policy is implemented at the operating company level.
At this level attention is paid to safety, accident prevention and absenteeism through sickness
and, above all, to the creation and maintenance of a loyal organisation with suffi cient fl exibility
and ambition. At every company there is regular and constructive consultation with the local
Works Council. The central Management Board participates in this consultation at least once
a year in the absence of the local manager.
Report of the Management Board
‘The strength of a company is determined by the loyalty, practical expertise and spontaneous efforts of its employees.’
The MMI company is the largest client of two specifi c companies, purchasing 20-25% of their
total production. These suppliers supply respectively 20% and 10% of the total volume
purchased by the MMI company. Although this represents a high degree of mutual dependency,
the MMI company does have the option of purchasing these products from other suppliers.
The food and agri companies use a variety of suppliers: Eastern European companies for the
more mass-produced products and companies in the region for specifi c components and smaller
quantities. The largest supplier (< 10% of the purchase volume) is based in the Czech Republic.
Real estate
The companies are increasingly being confronted with more stringent requirements regarding
possible soil contamination in the event of new construction or renovation. These stipulations
could lead to higher costs when expanding, or lower proceeds from the sale of real estate.
Environmental risks
Producing and processing plastic products and (silk-screen) printing fi lms go hand-in-hand with
environmental risks. Limiting these risks is a key issue for the Hydratec companies which must,
at all times, focus on the environmental aspects relevant to their operations and the prevention
of calamities. The current situation and related (fi nancial) risks at the production facilities are
evaluated and recorded on a regular basis. The aim of the evaluation is not only to ensure
compliance with environmental legislation, but also to assess what preventative measures can
Commercial
Although the Plastics companies’ top-10 clients account for around 65% of the total turnover,
the largest client accounts for less than 10%. If a large client terminates its relationship with the
company the loss of revenue cannot be offset immediately. In view of the fact that such client
relationships involve a wide range of products, should a client relationship be terminated the
actual loss of revenue would be gradual. Although two of the MMI company’s clients are
responsible for nearly 25% of the total revenue, here too these clients purchase more than
twenty and two hundred different products respectively. Changing supplier would be a lengthy
process for both these clients. The top-10 clients of the food and agri equipment companies
account for 50% of the revenue. Russia with around 20% of the revenue is the most important
sales region.
Product liability and product risks
Within the Hydratec companies many different production processes are carried out on a relatively
small scale and often involving a low level of automation. The resulting increased risk of human
error and incidental manufacturing faults can lead to a loss of product quality and the discontinuity
of the production process. In addition the Hydratec companies are developing more and more
products, which increases the risk of design faults. This can lead to relatively high costs for clients,
who will endeavour to be recompensed by their supplier. All the companies implement strict
quality standards and carry out Risk Inventories and Evaluations (RIE). All the companies are
ISO certifi cated or comply with an ISO-based quality system. All the companies are insured.
At all the companies product manufacture involves many different machines, which reduces the
risk of the breakdown of one machine constituting a major production risk.
Suppliers
The Plastics companies purchase raw materials that are used on a global scale by all plastics
companies. Although only a relatively few extremely large global suppliers operate in these raw
materials production markets, the (lack of) availability of these raw materials does not constitute
a real risk.
Report of the Management Board27
‘Technological innovation, business process optimisation and new partner-ships have contributed towards the good results.’
The points on which Hydratec deviates from the Code and the reasons why are listed per section
of the Code on the Corporate Governance page of the Company’s website.
The reporting systems used within our companies and the regular reports to the Management
Board are of major importance. Revenue and order in-fl ow are reported weekly. Monthly reports
include the most important fi nancial and operational components, such as revenue, gross margin,
operating costs, operating profi t, orders received, working capital components, personnel
summaries, investments, delivery/supply reliability and effi ciency. These reports form the basis for
monthly meetings between the Management Board and the operating company managements
as well as for the consolidated summaries that are also sent to the Supervisory Board. The local
managements also prepare quarterly reports which include an explanation of business progress
within their companies.
At least once a year a General Meeting of Shareholders is organised during which all the
resolutions are approved on the basis of the ‘one share, one vote’ principle. Shareholders,
individually or with a joint interest of at least 1% of the issued shares, are entitled to ask the
Management Board or Supervisory Board to add particular topics to the agenda. Important
Board resolutions which could result in a change to the company’s identity or character must
be approved by the General Meeting of Shareholders. The company’s Articles of Association
are published on the company’s website as are the main tasks and authorities of the General
Meeting of Shareholders and the Supervisory Board.
In control statement
Hydratec’s Management Board is of the opinion that the risk management and control systems
provide a reasonable level of assurance that the fi nancial reporting does not contain any material
misstatements. These risk management and control systems functioned properly during the year
under review and we have no indications that they will not function properly during the current
year. The process of refi ning the management and control systems has been, and will continue
to be, evaluated on a continuous basis.
be implemented. The recognised environmental risks are, when necessary, converted into concrete
action plans. The effectiveness of the implemented measures is checked continuously in order
to limit the risks as far as possible. In addition to the preventative measures, Hydratec’s policy is
also aimed at reducing the total environmental burden. The waste streams of all the companies
have been optimised with the objective of generating less waste. Developments that can lead
to improved environmental care will continue to be closely monitored in the future.
Automation
Hydratec strives to achieve production effi ciency and logistics advantages through, for example,
far-reaching automation. Its success is increasingly dependent on the timely and correct
implementation and/or extension of automation systems. This makes the organisation more
and more dependent on the proper functioning of these systems.
Foreign currency
Hydratec, with the exception of Danielson UK, invoices all its revenue in euros. Danielson
operates in the UK and invoices a large portion of its revenue in pounds sterling. In this respect
Hydratec faces a currency risk related to the translation of the fi nancial results and balance sheet
position into the company annual accounts and any dividend distribution. This risk is partially
hedged via local fi nancing of the working capital. Danielson Europe purchases components and
products from suppliers that invoice in US dollars. This accounts for around 20% of purchases.
In principle these euro/dollar positions are hedged by forward currency contracts. This guarantees
a constant purchase price over a longer period (three to six months).
Corporate Governance statement
The Supervisory Board and Management Board endorse the principles of Corporate Governance
and Hydratec Industries NV complies with the main provisions laid down in the Dutch Corporate
Governance Code. Key concepts such as transparency and accountability to and the participation
of the shareholders form the basis for our policy. We do, however, deem some of the guidelines
to be irrelevant for a small cap company. For example, in view of the company’s size and the fact
that its Supervisory Board has less than four members, no committees have been appointed.
28Report of the Management Board
29
A word of thanks
During 2011 all our companies were confronted with highly fl uctuating demands from their
clients. The considerable uncertainty regarding the general economic conditions in Western
Europe meant many of our clients wanted to keep their stock levels as low as possible.
This in turn generated more demand for short delivery times and we often had to call upon the
creativity of our employees in the form of extra effort or amended working hours. It is in times
such as these that a company’s strength is determined by the loyalty, practical know-how and
spontaneous efforts of its employees. We thank our employees for their considerable efforts.
Companies become increasingly dependent on their suppliers’ reliability of deliveries and
constructive co-operation, which form the basis for optimum and effective logistics. Which is
why we would like to thank our suppliers for their trust in us. Above all we thank our clients
who have put their trust in our companies’ products and services.
Amersfoort, 12 April 2012
Management Board
Roland Zoomers CEO
Bart Aangenendt Director
The Hydratec Management Board declares that, to the best of its knowledge, the annual accounts
provide a fair and accurate picture of the assets, liabilities, fi nancial position and profi ts of the
company and the companies jointly included in the consolidated annual accounts. The annual
report provides a fair and accurate picture of the situation as at the balance sheet date and the
business progress during the fi nancial year of the company and the affi liated companies for
which the data is included in the annual accounts. The annual report describes the actual risks
with which the company is confronted.
Outlook and expectations for 2012
In 2011 all the companies succeeded in achieving positive results despite the rapidly worsening
economic conditions and, therefore, contributed towards Hydratec’s positive results. The activities
of Lias will be consolidated for the whole of 2012. For this reason alone a higher revenue will be
achieved.
We are taking into account the fact that due to the extremely uncertain economic conditions the
revenue per company will not, or will hardly, increase. For this reason additional attention will be
paid to issues that could increase the margins and control the costs, on the one hand to offset
the increased personnel costs and, on the other hand, to at least maintain the operating profi ts
of all the companies at the current levels.
We do, however, believe that it is still too early to make more defi nite statements regarding the
results for 2012. Neither the level of investment nor the workforce are expected to undergo any
major changes in 2012 compared with 2011.
Report of the Management Board
30
31 Consolidated profi t and loss account
32 Consolidated statement of comprehensive income
33 Consolidated statement of changes in shareholders’ equity
34 Consolidated balance sheet
35 Consolidated cash fl ow statement
SUMMARISED ANNUAL ACCOUNTS 2011 Amounts in thousands of euros unless stated otherwise
31
€ x 1,000 2011 2010
Net revenue 84,190 55,137
Material usage 47,080 27,647
Gross margin 37,110 27,490
Wages and salaries 14,878 12,069
Social security premiums and pensions 3,285 2,305
Depreciation and amortisation of non-current assets 2,177 1,928
Other operating costs 11,247 8,115
31,587 24,417
Operating profi t 5,523 3,073
Interest income 154 120
Interest expenses 262 276
Financial income and expenses – 108 – 156
Profi t from normal business operations before taxes 5,415 2,917
Taxes 1,256 773
Net profi t 4,159 2,144
Net profi t attributable to:
Shareholders 3,631 1,765
Minority interest 528 379
4,159 2,144
Profi t per ordinary share (in euros) 3.07 1.49
Diluted profi t per ordinary share (in euros) 2.97 –
CONSOLIDATED PROFIT AND LOSS ACCOUNT
32
€ x 1,000Existing
activitiesNew
activities Other* 2011 2010
Net profi t 2,479 2,072 – 392 4,159 2,144
Currency translation differences 63 0 0 63 43
Result of hedge on fi nancial derivatives – 11 0 0 – 11 0
Total profi t after taxes 2,531 2,072 – 392 4,211 2,187
Total profi t attributable to:
Shareholders 2,141 1,834 – 352 3,623 1,808
Minority interest 390 238 – 40 588 379
2,531 2,072 – 392 4,211 2,187
* Amortisation of the fair value of Plastics and Agri & Food Equipment during 2011 due to the revaluations implemented as a result of the goodwill stipulation.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
33
€ x 1,000 2011 2010
Position as at 1 January 21,165 20,540
Shareholder related changes
Dividend distribution fi nancial year – 1,183 – 1,183
Share issue 722 0
Other changes
Result fi nancial year 3,631 1,765
Currency translation differences 63 43
Changes in hedge reserve – 11 0
Position as at 31 December 24,387 21,165
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
34
€ x 1,000 2011 2010
ASSETS
Intangible fi xed assets 16,768 2,950
Tangible fi xed assets 20,293 12,289
Financial fi xed assets 587 403
Total fi xed assets 37,648 15,642
Stocks 17,136 8,291
Trade debtors 14,091 6,011
Taxes and social security premiums 1,708 434
Other receivables 1,947 349
Accrued assets 281 378
Cash and cash equivalents 1,575 5,887
Total current assets 36,738 21,350
Total assets 74,386 36,992
€ x 1,000 2011 2010
LIABILITIES
Shareholders’ equity 24,387 21,165
Minority interests 3,033 1,710
Group equity 27,420 22,875
Personnel related provisions 487 425
Deferred tax liabilities 2,544 991
Other provisions 1,035 432
Non-current debts 7,479 1,241
Interest rate derivatives 182 163
Total provisions and non-current debts 11,727 3,252
Trade creditors 7,712 4,162
Taxes and social security premiums 1,483 940
Owed to banks 5,610 3,200
Other debts and accrued liabilities 20,434 2,563
Total current debts 35,239 10,865
Total liabilities 74,386 36,992
before profi t appropriationCONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER
35
€ x 1,000 2011 2010
Profi t before taxation + 5,415 + 2,917
Adjustment for:
– Depreciation and amortisation + 2,177 + 1,928
– Book profi t/loss on sale of fi xed assets + 13 0
Financial income and expenses + 108 + 156
Changes in provisions + 350 – 25
Changes in working capital:
– Stocks + 2,871 – 1,529
– Current receivables + 496 – 733
– Current liabilities + 277 – 311
+ 3,644 – 2,573
Financial income and expenses received/paid – 164 – 175
Profi t tax paid – 655 – 567
Cash fl ow from operating activities + 10,888 + 1,661
Investments in intangible assets – 116 – 47
Disposal of intangible assets 0 + 7
Investments in tangible non-current assets – 2,259 – 2,016
Disposal of tangible assets + 166 + 142
Investments in fi nancial assets – 185 0
Disposal of fi nancial assets 0 + 24
Acquisition Agri & Food Equipment* – 15,910 0
Acquisition Plastics* 0 – 8,405
Cash fl ow from investing activities – 18,304 – 10,295
* After deduction of acquired cash and cash equivalents.
€ x 1,000 2011 2010
Dividend paid to shareholders – 1,183 – 1,183
Dividend paid to old shareholders Agri & Food
Equipment – 1,930 0
Payment of third party share capital (Naamplaat
Holding) 0 – 39
Third party dividends (Plastics / Naamplaat Holding) – 159 – 234
Repayment of non-current liabilities – 352 – 413
Non-current borrowings + 4,357 0
Cash fl ow from fi nancing activities + 733 – 1,869
Net cash fl ow – 6,683 – 10,503
Currency translation differences + 21 – 27
Change in cash and cash equivalents – 6,662 – 10,530
Cash and cash equivalents as at 1 January + 3,020 + 13,550
Cash and cash equivalents as at 31 December – 3,642 + 3,020
CONSOLIDATED CASH FLOW STATEMENT
36
2011 2010 2009 2008 2007
Profi t and loss account
Net revenue 84,190 55,137 17,322 20,398 35,836
Operating profi t 5,523 3,073 – 1,223 2,201 4,364
Operating profi t excluding one-time income 5,523 3,073 – 1,223 1,705 3,173
Net profi t to be allocated to shareholders 3,631 1,765 – 255 9,708 3,334
Net profi t excluding one-time income 3,631 1,765 – 590 1,550 2,350
Cash fl ow / 2
Cash fl ow from operating activities 10,888 1,661 653 4,324 4,278
Cash fl ow from investing activities – 18,304 – 10,295 – 1,277 10,654 – 2,218
Cash fl ow from fi nancing activities 733 – 1,869 – 1,222 – 1,183 – 2,110
Net cash fl ow – 6,683 – 10,503 – 1,846 13,795 – 50
Balance sheet
Shareholders’ equity 24,387 21,165 20,540 21,876 13,818
Group equity 27,420 22,875 20,861 22,190 14,123
Balance sheet total 74,386 36,992 24,079 25,408 19,459
/ 1
Amounts in thousands of euros unless stated otherwise
1 / Based on continued business activities.
2 / 2010 cash fl ow adjusted on basis of movement in cash and cash equivalents and bank current account.
FIVE YEAR SUMMARY
37
2011 2010 2009 2008 2007
Key ratios
Operating profi t as % of revenue 6.6% 5.6% – 7.1% 8.4% 8.9%
Return on invested capital 8.7% 8.2% – 7.6% 16.2% 18.2%
Return on shareholders’ equity 15.9% 8.5% – 1.5% 8.7% 17.8%
Solvency 36.9% 61.8% 86.6% 87.3% 72.6%
Data per ordinary share (in euros)
Operating profi t / 3 4.52 2.60 – 1.03 1.44 2.68
Shareholders’ equity 19.95 17.89 17.36 18.49 11.68
Profi t per share 3.07 1.49 – 0.22 8.21 2.82
Profi t per share excluding one-time income 3.07 1.49 – 0.50 1.31 1.99
Diluted profi t per share 2.97
Dividend / 4 1.20 1.00 1.00 1.00 1.70
Price at year end 18.05 15.00 14.30 15.86 24.75
Lowest price 14.70 12.40 13.50 15.86 19.51
Highest price 19.98 16.25 19.44 24.87 27.48
Other information
Average number of employees 381 330 158 167 273
Net revenue per employee 221.0 167.1 109.6 122.1 131.4
Salary costs per employee 47.7 43.6 39.1 37.2 38.33 / Excluding one-time income.4 / 2007 including extra dividend
of € 0.70 .
Amounts in thousands of euros unless stated otherwise Five year summary
38 CONTACT DETAILS
Hydratec Industries NV
CEO Roland Zoomers
Director Bart Aangenendt
Address Nijverheidsweg Noord 40
Postbus 328
3800 AH Amersfoort
The Netherlands
Telephone Int. + 31 (0)33 469 73 25
Telefax Int. + 31 (0)33 469 73 14
E-mail [email protected]
Website www.hydratec.nl
Agri & Food Equipment
Pas Reform BV
Managing Director Bart Aangenendt
Address Bovendorpsstraat 11
Postbus 2
7038 ZG Zeddam
The Netherlands
Telephone Int. + 31 (0)314 65 91 11
E-mail [email protected]
Website www.pasreform.com
LAN Handling Systems BV
Managing Director Harm Langen
Address Jules Verneweg 123
5015 BK Tilburg
The Netherlands
Telephone Int. + 31 (0)13 532 25 25
E-mail [email protected]
Website www.lan-hs.com
Man Machine Interfaces
Danielson Europe BV
Managing Director Peter Boerdijk
Address De Nieuwe Haven 12
7772 BC Hardenberg
The Netherlands
Telephone Int. + 31 (0)523 28 12 00
E-mail [email protected]
Website www.danielsoneurope.com
Danielson UK Ltd.
Managing Director Peter Boerdijk
Address 29 Pembroke Road
Stocklake
Aylesbury
Bucks
HP20 1DB
England
Telephone Int. + 44 (0)12 96 31 90 00
E-mail [email protected]
Website www.danielson.co.uk
Plastics
Euro Mouldings BV
Managing Director Martin Essink
Address Ambachtsweg 3
7442 CS Nijverdal
The Netherlands
Telephone Int. + 31 (0)548 61 10 07
E-mail [email protected]
Website www.euromouldings.com
Timmerije BV
Managing Director Wim Simons
Address Schoolweg 29
Postbus 3
7160 AA Neede
The Netherlands
Telephone Int. + 31 (0)545 28 38 00
E-mail [email protected]
Website www.timmerije.nl
Hydratec Industries NV
Nijverheidsweg Noord 40
Postbus 328
3800 AH Amersfoort
The Netherlands