Consolidated Statement of Changes in Equity
Note 1.5. INCOME STATEMENT PRESENTATION
1.5.1. Revenue
Revenue corresponds to the value, excluding tax, of goods and services sold by consolidated companies in the course of their ordinary activities, after eliminating intra-group sales.
Revenue is recognised when the signifi cant risks and rewards of ownership are transferred to the buyer – generally when the customer receives a product – for an amount corresponding to the fair value of the consideration received or receivable as determined after deducting rebates and discounts. Advertising expense contributions billed by customers and the cost of consumer promotions that do not fulfi l the criteria for recognition as operating expenses are recognised as a deduction from revenue. The reported amount of revenue also includes miscellaneous revenues.
Freight and other costs billed to customers are treated as an integral part of revenue.
Accruals are booked for deferred rebates granted to customers on the basis of contractual or constructive commitments identifi ed at the period-end.
1.5.2. Operating result from activity and operating
expenses
The Group’s main performance indicator is operating result from activity, which corresponds to revenue less operating expenses. Operating expenses comprise the cost of sales, research and development costs, advertising costs and distribution and administrative expenses. Statutory and discretionary employee profi t sharing and other operating income and expenses, as defi ned in Note 1.5.4, are excluded from the calculation.
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Consolidated financial statements
Notes to the consolidated financial statements
1.5.3. Recurring operating profi t
Recurring operating profi t corresponds to operating result from activity less statutory and discretionary employee profi t sharing.
1.5.4. Operating profi t
Operating profi t comprises all the recurring and non-recurring income and expenses generated in the course of the Group’s ordinary activities, including income and expenses resulting from one-off decisions or transactions that are unusual in terms of their amount. Other non-recurring items, reported under “Other operating income and expenses”, mainly include the following (see Note 7 for details):
•
costs of signifi cant restructuring plans;•
impairment losses on property, plant and equipment and intangible assets, including goodwill;•
costs related to business combinations (excluding the costs of issuing equity instruments or of new debt contracted for the purpose of the business combination) and the remeasurement at fair value of any previously held investment on the date control was obtained;•
gains or losses recognised upon losing exclusive control of a subsidiary, including the remeasurement at fair value of any retained investment;•
gains and losses on very exceptional events (litigation, asset disposals, etc. involving unusually large amounts) and changes in provisions booked for these types of events.1.5.5. Other income statement items
Accrued interest on interest-bearing instruments is recognised by the effective interest method based on the purchase price.
Dividend income is recognised when the shareholder’s right to receive payment is established.
Finance costs are recognised in the income statement on an accruals basis.
1.5.6. Earnings per share
Basic earnings per share correspond to profi t attributable to owners of the parent divided by the weighted average number of shares outstanding during the period, excluding treasury stock.
Diluted earnings per share are calculated by adjusting the weighted average number of shares outstanding to take into account the dilutive effect of stock options and other equity instruments issued by the company.
NOTE 2
RESTATEMENT OF FINANCIAL INFORMATION REPORTED IN 2011
Under IFRS, reported prior-period data must be restated for:
•
operations meeting the criteria in IFRS 5 – Non-current Assets Held for Sale and Discontinued Operations;•
business combinations (recognition of the defi nitive fair value of assets acquired and liabilities and contingent liabilities assumed when such fair value was determined on a provisional basis at the previous balance sheet date);•
changes in accounting methods (subject to any transitional provisions to the contrary applicable on fi rst-time adoption of new standards);•
corrections of accounting errors.In 2012, the Group decided to early-adopt IAS 19R – Employee Benefi ts. The revised standard eliminated the option of applying the corridor approach and required the immediate recognition of actuarial gains and losses in equity. This resulted in an increase in the provision for pension and other post- employment benefi t obligations and an equivalent amount being recorded as a deduction from equity, after taking into account the related deferred tax effect from these provisions.
The effects of applying the amended standard were calculated retrospectively, as if IAS 19R had been adopted as from 1 January 2010. Therefore, the fi nancial information at 31 December 2011 published in the 2011 Registration Document were restated. The main balance sheet captions affected are summarised in the following table:
Main balance sheet captions affected (in € millions) Reported in 2011 IAS 19R Restated in 2012
EQUITY AT1 JANUARY 2011 1,571.3 (24.8) 1,546.5
Other comprehensive income 30.9 3.3 34.2
Profi t for the period 260.9 1.5 262.4
Other movements (501.3) (501.3)
EQUITY AT 31 DECEMBER 2011 1,361.8 (20.0) 1,341.8
Balance sheet total at 31 December 2011 3,362.2 10.1 3,372.3
Long-term provisions (127.6) (30.2) (157.8)
Consolidated financial statements
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Notes to the consolidated financial statements
NOTE 3
CHANGES IN THE SCOPE OF CONSOLIDATION
Note 3.1.
TRANSACTIONS IN 2013
Egypt
In the fi rst quarter of 2013, Groupe SEB set up a 75%-owned joint subsidiary with Egypt’s leading manufacturer of small household equipment, Zahran, which was the Group’s main cookware distributor in the country. The company Groupe SEB Egypt for Household Appliances, SEB’s fi rst direct outlet in Africa, has the aim of dynamising Group sales in Egypt, which previously went through third-party distributors.
The subsidiary contributed €9.2 million to Group sales in 2013.
Coranco
On 16 December 2013, Groupe SEB acquired the Canadian company Coranco, giving it direct control over the marketing of Lagostina products in Canada. Having been acquired so late in the year, Coranco was not consolidated at 31 December 2013. Coranco shares were reported under “Other investments” on the 2013 consolidated balance sheet.