iMPlenia in brief
implenia develops and builds the switzerland of tomorrow. Implenia is Switzerland’s leading construction and construction services company. With its integrated business model and comprehensive portfolio of products and services, Implenia can manage a building project through its entire lifecycle and deliver work that is economical, sustainable, integrated and customer-centric. Formed in 2006 from the merger between Zschokke and Batigroup, Implenia can look back on more than 140 years of history in the construction industry. Experience, know-how, size and financial strength allow Implenia to offer its services throughout Switzerland and on an international level for selected competences. The entire Group’s capabilities and capacities can be made available for challenging real estate and infrastructure projects. Implenia brings together the expertise of three specialist divisions:
Industriestrasse 24 CH-8305 Dietlikon Phone + 41 44 805 45 55 Fax + 41 44 805 45 56 www.implenia.com
Implenia | Annual Report 2011
Implenia Ltd.
− As a full-service provider, Implenia Real Estate covers all areas of a property’s lifecycle, from sourcing the finance, to development and realisation, to operational optimisation and promotion. It is the market leader for General Contracting in Switzerland. − Implenia Infrastructure Construction offers the full range of building services, from classic road construction and civil works, through building construction, restoration and refurbishment, to civil engineering and foundation engineering. Here too, Implenia is the market leader in Switzerland. − Implenia Industrial Construction is a specialist in its home and international markets for underground infrastructure projects, as well as for demanding prime building projects outside Switzerland.
Annual Report 2011
Implenia’s head office is in Dietlikon near Zurich, and it has approximately 100 branches throughout Switzerland, as well as representative offices in Norway, Germany, France, Italy, Russia and the United Arab Emirates. The Group employs more than 6,000 people and in 2011 generated a revenue of CHF 2.5 billion. For more information, please visit www.implenia.com.
Key figures
Implenia in brief
Consolidated profit (in CHF million)
20 2%
61.4 57.2
52.5 40.0
40.9
47.1
8%
6%
23.2
40.0
4%
Implenia develops and builds the Switzerland of tomorrow.
2.4%
30
1.7%
3.7%
3.3%
3.0%
2.6%
4%
40 25.5
6%
2.1%
93.7 77.7 58.3
50
57.1
67.6
60
1.1% 22.0
20
1.6% 32.8
40
38.7
60
70
8%
35.3
59.0
80
10%
81.4
100
2.2%
Operating income (in CHF million)
2%
Implenia is Switzerland’s leading construction and construction services company. With its integrated business model and comprehensive portfolio of products and services, Implenia can manage a building project through its entire lifecycle and deliver work that is economical, sustainable, integrated and customer-centric.
6.2
12.5
4.2
2009
2010
2011
12.3
2011
16.8
19.4
2010
2008
10.5
2009
0
3.5
23.7
2008
2nd semester Sale of Privera CHF 11.3 million 1st semester margin
0%
2007
5.9
0
2007
10 0%
Formed in 2006 from the merger between Zschokke and Batigroup, Implenia can look back on more than 140 years of history in the construction industry. Experience, know-how, size and financial strength allow Implenia to offer its services throughout Switzerland and on an international level for selected competences. The entire Group’s capabilities and capacities can be made available for challenging real estate and infrastructure projects.
2nd semester Sale of Privera CHF 11.3 million 1st semester margin
Implenia brings together the expertise of three specialist divisions: Consolidated key figures 2011
2010
CHF 1,000
CHF 1,000
2,522,646
2,388,418
5.6%
EBIT divisions Operating income
93,529 93,676
76,997 77,658
21.5% 20.6%
Consolidated profit
61,351
52,458
17.0%
Consolidated revenue
EBITDA Free cash flow Production output Order book Headcount (full time equivalents) Net cash position Equity
140,489 67,311
∆
112,552 24.8% 39,920 68.6%
2,776,666 3,153,915 5,648
2,716,205 3,070,314 5,424
2.2% 2.7% 4.1%
193,459 543,528
149,514 495,484
29.4% 9.7%
− As a full-service provider, Implenia Real Estate covers all areas of a property’s lifecycle, from sourcing the finance, to development and realisation, to operational optimisation and promotion. It is the market leader for General Contracting in Switzerland. − Implenia Infrastructure Construction offers the full range of building services, from classic road construction and civil works, through building construction, restoration and refurbishment, to civil engineering and foundation engineering. Here too, Implenia is the market leader in Switzerland. − Implenia Industrial Construction is a specialist in its home and international markets for underground infrastructure projects, as well as for demanding prime building projects outside Switzerland. Implenia’s head office is in Dietlikon near Zurich, and it has approximately 100 branches throughout Switzerland, as well as representative offices in Norway, Germany, France, Italy, Russia and the United Arab Emirates. The Group employs more than 6,000 people and in 2011 generated a revenue of CHF 2.5 billion. For more information, please visit www.implenia.com.
Key figures
The year in brief
20 2%
61.4 57.2
40.0
52.5
8%
40.9
47.1
Implenia can look back on a very satisfactory business year and has posted very good results. By acquiring Betonmast Anlegg and thus securing access to the Norwegian growth market, it has also taken a significant step forward in the implementation of its international strategy and towards the attainment of its associated growth targets. High-potential investments in the project development sector are making an important contribution to the long-term security of business volumes and operating results. Other important priorities in 2011 included greater collaboration across different parts of the Group, and further progress on sustainability.
6%
23.2
40.0
4% 2.4%
30
1.7%
3.7%
3.3%
3.0%
4%
40 25.5
6%
2.1%
93.7 77.7 58.3
67.6
50
57.1
59.0
60 8%
35.3 2.6%
70
1.1% 22.0
20
1.6% 32.8
40
38.7
60
10%
81.4
100
80
A successful 2011 for Implenia
Consolidated profit (in CHF million)
2.2%
Operating income (in CHF million)
Publication details
2%
6.2
12.5
4.2
2009
2010
2011
12.3
2011
16.8
19.4
2010
2008
10.5
2009
0
3.5
23.7
2008
2nd semester Sale of Privera CHF 11.3 million 1st semester margin
0%
2007
5.9
0
2007
10 0%
2nd semester Sale of Privera CHF 11.3 million 1st semester margin
In this year’s annual report, Implenia focuses on three topics relevant to its work as a construction and construction services company. Consolidated key figures 2011
2010
CHF 1,000
CHF 1,000
2,522,646
2,388,418
5.6%
EBIT divisions Operating income
93,529 93,676
76,997 77,658
21.5% 20.6%
Consolidated profit
61,351
52,458
17.0%
Consolidated revenue
EBITDA Free cash flow Production output Order book Headcount (full time equivalents) Net cash position Equity
140,489 67,311
∆
112,552 24.8% 39,920 68.6%
2,776,666 3,153,915 5,648
2,716,205 3,070,314 5,424
2.2% 2.7% 4.1%
193,459 543,528
149,514 495,484
29.4% 9.7%
− High-quality infrastructure and the mobility this facilitates among the population is one of Switzerland’s biggest competitive advantages on the international stage. Implenia helps ensure that this remains the case in the future. Two projects – the Poya Bridge in Fribourg and the A9 bypass round Lausanne – illustrate what this means in practice: Focus Theme, page 18. − Space is a limited resource, and particularly in a small country like Switzerland it is vital that this resource is used carefully. Densification is the watchword. Using the Europaallee project in Zurich as an example, Implenia examines the challenges involved in building complex high-density urban construction projects: Focus Theme, page 70. − Employees form the foundations of corporate success. This is why Implenia is so active in providing training and development opportunities. These range from apprenticeships (see interview on page 30), through university education (interview with Nathalie Fontana of the ETH Foundation, page 112), to internal courses like the construction cost planner career programme (see Fold-out Focus Employer).
Publication details Published by: Implenia Ltd., Dietlikon Concept and Design: schneiter meier AG, Zurich Photos: Gerry Amstutz and Franz Rindlisbacher, Zurich (picture spreads, Discussion and Executive Committee), Jean-François Meyland, Ecublens (A9 picture spread, pages 25 – 27), Fotostudio Di Cristo & Ruggiero, Flawil (Board of Directors portraits), Bernhard Fuchs, Langnau am Albis (Karl’s kühne Gassenschau page 7) Text: Dynamics Group AG, Zurich Translation: James Knight Ltd., Warwickshire, England Printing: Linkgroup, Zurich
Contents
2011 in pictures
2
Annual report 2011 10
Letter to Shareholders 12 Focus – Infrastructure 18
Apprentices talk to the CEO 30 Annual report 2011 40
112 Focus – Employer 127 Corporate Governance 135 Board of Directors 144 Executive Committee 155 financial report 156 Implenia Group’s consolidated financial statements
Real Estate 48 248 Implenia Ltd.’s financial statements
Infrastructure Construction 52 262 Locations, contact addresses and terms
Industrial Construction 56 Implenia in Norway 61 Corporate Center 64 Value-based Management 66 Focus – Densification 70
Vision, values and positioning 82 Strategy and business model 86 Employees 90 Sustainability 98
01.EN.006.03.12
Information for investors 104
The annual report is also published in German and French. The original German is the authoritative version.
2–3
2011 in pictures
31.01.
19.04.
Laying the foundation stone in the centre of Visp Implenia starts work on the Brückenweg building complex.
2011 Annual General Meeting Moritz Leuenberger and Theophil Schlatter are elected as new members of Implenia’s eight-person Board of Directors.
10.03.
Implenia announces 2010 results Implenia’s success story continues, with record results for the 2010 financial year. Its integrated business model, in which all three divisions cooperate with each other, proves its worth once again. The dividend is increased by almost 30%.
15.04.
Rise in operating earnings compared with 2009
Implenia develops new head office for The Global Fund “The Global Fund” against AIDS, tuberculosis and malaria is building a new office building in Geneva, with Implenia as project developer.
22.03.
“Fischer’s Fritz” for sustainable living The project wins the competition run by Implenia to design a sustainable development in Gossau.
23.03.
Final cut-through under the Gotthard The final cut-through marks another milestone in the creation of the new transalpine train route. Both parallel tunnels have now been fully excavated. Implenia completed all the drilling work on schedule.
17.04. / 15.05.
Marathons in Zurich and Geneva Implenia celebrates hard work, achievement and perseverance as sponsor of two popular running events.
01.06.
Implenia builds at EuropaPark Rust Implenia awarded the contract to construct the theme park’s fifth hotel “Bell Rock”.
4–5
2011 in pictures
09.06.
Implenia AG
Code of Conduct
Competition Commission (WEKO) delivers draft judgement on Canton Aargau cases Implenia condemns cartel agreements and has taken comprehensive measures.
Unternehmens- und Verhaltensrichtlinien
20.06.
Implenia develops the Central Switzerland of tomorrow Studies completed for key site between Baar and Zug. Winning project impresses with its quality and sustainability.
15.08.
Saving fuel thanks to “Eco-Drive” Implenia runs regular courses for its employees on how to drive construction machinery and cars efficiently. Machinery fuel saved
18.07.
Betonmast Anlegg acquisition completed Implenia establishes foothold in Norwegian market.
19.08.
Implenia qualifies as sustainable investment Implenia is immediately accepted into Dutch bank Kempen Capital Management’s Socially Responsible Investment Universe (SRI Universe) (More details on page 101).
21.07.
Total contractor order for Plot E Swiss Federal Railways commissions Implenia to follow up its work on Plots A and C by building the next phase of Zurich’s new Europaallee development.
01.09.
Implenia back at the DEFI Implenia teams compete at the Swiss corporate sports championship for the 22nd time.
6–7
2011 in pictures
01.09.
11.10.
Demanding 1st half-year for Implenia Implenia maintains the level of sales, but suffers a decline in earnings. This is a result of operational challenges in Infrastructure Construction; corrective action has been taken. The other divisions show year-on-year improvements.
A place for culture on the Sulzer site Implenia provides a hall for cultural events on the Sulzer site in Winterthur.
13.10.
Karl’s kühne Gassenschau stays in Winterthur Site owner Implenia will once again host the spectacular show FABRIKK in Winterthur in 2012.
15.09.
Second tunnel project in Arabia Implenia is commissioned to build a microtunnel network for a waste-water treatment plant in Bahrain.
15.09.
Oerlikon station expansion contract awarded to Implenia Swiss Federal Railways commissions a consortium led by Implenia to expand Oerlikon station. By 2016, capacity will be created for the new cross-city line and the expansion of the Zurich S-Bahn.
03.10.
Changes in the Board of Directors and Executive Committee Board of Directors appoints Anton Affentranger as CEO; former Vice-Chairman Markus Dennler becomes new Chairman of the Board.
8–9
2011 in pictures
17.10.
25.11.
Daisy blooms in the far north Norwegian acquisition Betonmast Anlegg now operates under the Implenia brand.
Implenia in Winterthur for a year A year after acquiring Sulzer Immobilien AG and its land and properties in central Winterthur, Implenia and the mayor of Winterthur announce details of the development of the former Sulzer industrial complex.
21.10.
Implenia starts a new training course for construction cost planners There is a demand for well qualified construction cost planners. But until now there has not been any suitable professional training. In order to fill this gap, Implenia and the Lucerne University teamed up to create the “CAS Baukostenplanung GU / TU” (“Certificate of Advanced Studies in Construction Cost Planning for General and Total Contracting”) training course (more information in fold-out focus-employer).
05.12.
Implenia with solar cell pilot project The first portacabins in Switzerland equipped with photovoltaic cells are set up at Implenia’s construction site in Lausanne-Vennes and produce their own electricity.
30.10.
Lucerne Marathon goes through the tunnel The course of the fifth Lucerne Marathon takes runners through the new Zentralbahntunnel built by Implenia. The project won the 2012 Infra Prize (prize awarded every year by “Fachverband Infra”, the Swiss association of infrastructure construction companies).
19.12.
Increased strength in building construction business Implenia Infrastructure Construction adjusts organisa tional structures to improve customer focus and risk management, thus setting the course for a sustained improvement in earnings from building construction.
Navigation
Annual Report 2011
10–11
Letter to Shareholders 12 – Apprentices talk to the CEO 30 – Annual report 2011 40 – Real Estate 48 – Infrastructure Construction 52 – Industrial Construction 56 – Implenia in Norway 61 – Corporate Center 64 – Value-based Management 66 – Vision, values and positioning 82 – Strategy and business model 86 – Employees 90 – Sustainability 98 Information for investors 104
Letter to Shareholders
12–13
Dear Shareholder,
Our company can look back on a successful financial year. It achieved excellent results. By acquiring Betonmast Anlegg and entering the Norwegian growth market, a significant step forward has been taken in the implementation of our international strategy and towards the attainment of our earnings and growth targets. Promising investments in the project development area made an important contribution to the long-term sustainability of business volumes and operating results. Other important priorities in 2011 included improved collaboration across different parts of the Group, and further progress on our sustainability strategy. Strategic foundations laid for earnings growth We are pleased to be able to present you with another good set of annual results. With EBITDA, operating result and consolidated profit well above previous year’s levels, 2011 was a very successful financial year. In addition, important strategic steps have been taken that will help us unlock our Group’s potential. Our earnings targets are within reach.
Chairman of the Board of Directors Markus Dennler (right) and CEO Anton Affentranger (left) look back on a successful 2011 financial year.
Letter to Shareholders
Project development business gains further momentum In Switzerland, Implenia made some significant, highly promising investments in the proj ect development area in the second half of the year – including “Wrighthouse” in Opfikon, “The Metropolitans” in Zurich, and “Unterfeld” in Zug / Baar. These projects not only make an important contribution to maintaining medium-term business volumes and operating results in the Project Development business area but, thanks to the Group’s “One Company” integrated business model, help boost General Contracting and Infrastructure Construction too. Various projects were taken forward in Winterthur as part of the development of the former Sulzer sites in the city centre and in Neuhegi. In Basel, Implenia is building the “schorenstadt” housing estate – a beacon project for the 2000-Watt Society. Implenia moves into Norwegian market and presses ahead with internationalisation One highlight of the 2011 financial year was the acquisition of the Norwegian company Betonmast Anlegg. This acquisition marked a milestone in our international strategy, laying the foundations for our participation in the booming Norwegian tunnel and infrastructure market. With the expertise we have proven in Switzerland and with our strong team in Norway, all the elements are in place for us to position ourselves successfully in this market. Since October, Betonmast Anlegg has been operating in the Norwegian market as Implenia Norge. The acquisition represents another important step in the realisation of Implenia’s vision: “We are establishing ourselves as a recognised international expert in challenging infrastructure projects”. Furthermore, we socred successes in the Middle East with revenues flowing from our first infrastructure contracts in the region – microtunnelling projects in Al Ain (Abu Dhabi) and Muharraq (Bahrain).
14–15
Real Estate and Industrial Construction generate very good results The Real Estate and Industrial Construction Divisions achieved very good results for the year under review, contributing substantially to our excellent consolidated result. In addition, the settlement reached between Consorzio TAT and AlpTransit Gotthard (ATG) generated various positive contributions. The settlement represents a good solution for all concerned, and marks another important step towards the successful completion of the historic Gotthard project. Foundations laid for successful earnings growth at Infrastructure Construction After a difficult first half of the year, the earnings situation at Infrastructure Construction stabilised thanks to the immediate measures taken. The division also laid the foundations for a long-term positive operating performance. The focus is on strengthening client acquisition and customer service in Building Construction as well as effective, centralised cost calculations. We also created the conditions for a flexible, optimised use of personnel and technical resources. Against this background the new “Building Construction German-Speaking Switzerland” business area was established within the Infrastructure Construction Division on 1 January 2012. This will help improve our customer and market orientation in Building Construction. Changes in the Board of Directors and Executive Committee On 1 October 2011 the Board of Directors transferred operational management of Implenia to Anton Affentranger. Mr. Affentranger has stepped down from Implenia’s Board of Directors and given up operational management of his private companies. The new Chairman of the Board of Directors, as from 1 October 2011, is Dr. Markus Dennler who, as the former Chairman of Batigroup, had been Vice-Chairman of the Board since the merger in 2006. Existing Board member Hans-Beat Gürtler was elected Vice-Chairman.
16–17
Letter to Shareholders
New management for Industrial Construction On 1 October 2011, Dr. Peter Preindl joined the Executive Committee and on 1 January 2012 he became the new Head of the Industrial Construction Division. As the former CEO of Austrian construction group Alpine Bau he has proven expertise and many years of experience in the construction industry. Mr. Preindl took over as Division Head from Luzi R. Gruber, who retired on 1 January 2012, but who will continue to help us in an advisory capacity on strategic issues and selected projects. We would like to thank Luzi R. Gruber for his many years of exceptionally successful work, including his role in the building of the Gotthard base tunnel and the development of our company’s international strategy. On 1 January 2012, Rainer Preisshofen joined Implenia as the new Head of the Prime Buildings business unit within the Industrial Construction Division. We are confident that with these new appointments Industrial Construction is ideally positioned for the strategic and operational challenges that lie ahead.
Full order books and a positive outlook Full order books, our committed employees and a focussed strategy mean we can look forward to the future with confidence. A significant improvement in incoming orders in the final quarter of 2011, a stronger customer orientation and a striking sense of fresh energy within the Group are contributing further to the positive outlook. On the market, we expect public sector investment activity to remain stable, especially in the infrastructure segment. The private sector is likely to be negatively affected by the strong franc and economic uncertainties in Europe. However, low interest rates, still relatively low property vacancy rates and the consistently high number of people migrating into Switzerland make us confident about private-sector business too. Thank you The successful results we present to you here were made possible by the hard work of all the employees who devote their expertise and passion every day to achieving Implenia’s goals. We would like to thank them very much for all they have done. And thanks also to you, our valued shareholders, for your confidence and your loyalty.
Sustainability remains in focus Sustainability is a passion at Implenia, and it will remain the central principle in all our activities. In 2011 we carried out the groundwork that will allow us to publish our first Sustainability Report in autumn 2012. Higher dividends Against the background of very good results for 2011 and the continuing positive outlook, the Board of Directors proposes to the General Meeting of 4 April 2012 to approve distribution from capital reserves of CHF 1.10 per share (compared with a dividend in the form of a reduction in par value of CHF 0.90 in 2010).
Markus Dennler Chairman of the Board of Directors
Anton Affentranger CEO
Since 1984 mobility has sharply increased in Switzerland. This has been due to population growth, urban sprawl into rural areas and the fact that more and more people have to travel ever greater distances between where they live, work and engage in leisure pursuits. Most travel is down to everyday commuting and business trips; vacations and leisure excursions account for just one-third. Whereas in 1970 as many as 580,000 working people (20%) did not have to commute to work, by 2000 this number had shrunk to 303,000 (10%). According to the Federal Office for Statistics (FOS), the distances now travelled by working people are more than twice those of the other age groups. Increased mobility does not necessarily mean that Swiss people are constantly travelling further or faster. They most frequently still walk or cycle, as a survey by the Federal Office for Planning and Development revealed. For longer
distances they prefer to use their cars. Although modes of public transport – rail, bus and tram – managed to increase their share overall, at just under 20% they account for only a slightly higher proportion than air travel.
Shifting onto the roads The car is therefore the most popular and most commonly used mode of transport in Switzerland. Only 20% of households do not own a car; in 1984 the figure was still as high as 31%. In 2010 around 91 billion person kilome-
“More and more freight traffic has shifted onto the roads.” Federal Office for Statistics, “Mobility and Transport”, February 2011
90,666
89,930
88,525
100,000
87,492
86,023
86,816
The number of person kilometres travelled by private road transport and on the rail network has risen continuously since 2005.
80,000
0
2005
2006
2007
2008
2009
4,006.1
19,177
3,901.3
18,571
3,813.8
17,775
3,963.5
17,434
40,000
3,888.6
20,000
16,578
60,000
3,857.9
According to the “Mobility and Transport” study carried out by the Federal Office for Statistics, in 2010 the Swiss population travelled a combined total of more than 120 billion kilometres. That is equivalent to each individual travelling half the earth’s circumference per year. Although more and more people are using the railways, the car remains the number one mode of transport.
Number of person kilometres
16,144
Mobility: Switzerland’s trump
Rail Road (private) Road (public transport)
2010
Source: Federal Office for Statistics, “Mobility and Transport”, December 2011
tres were travelled by car, 7.5 billion more than in the year 2000. The extra strain in recent years has been taken mainly by the national trunk roads, which have acquired much greater macroeconomic significance. In 2011 alone the Federal government invested nearly 2 billion francs in roads, most of it for maintenance and expansion of the existing network. Since 2000 this has gained another 330 kilometres, with 150 kilometres being added to the Swiss motorway network, on which volumes have more than doubled since 1990. According to ASTRA, the Federal Office for Roads, the most heavily used roads in the country include the stretches of the A1 between Geneva and Lausanne and between Berne and Winterthur, and the A2 in the Basel region.
Towns and cities more environmentally friendly Thanks to the improvements made under the “Bahn 2000” project, the
railways have made up a lot of ground. Although the network was expanded only slightly (by 60 kilometres), rail travel has seen the same sort of strong growth as road travel, accounting for an additional 6.56 billion person kilometres since 2000. Even so, advocates of sustainable development can point to only partial success. Targets and reality are drifting ever further apart, especially in freight traffic, less and less of which is transported by rail. “This longterm trend is in line with developments in the European Union, where more and more traffic has been shifting onto the roads”, the FOS reports in the latest edition of “Mobility and Transport”. Rail, bus and tram are used most eagerly by town and city dwellers. In urban areas, 30% of households do not own a car at all. This is one of the benefits of urban densification: it allows people to live, work and play in close proximity and so make transport more environmentally friendly.
More sustainable mobility thanks to intelligent infrastructure projects The Pont de la Poya Bridge in Fribourg and the stretch of the A9 near Lausanne were among the most important infrastructure projects undertaken by Implenia in 2011. Both have a traffic-calming impact: the Pont de la Poya will relieve pressure on the old town of Fribourg, while the new surface on the A9 reduces the risk of aquaplaning and suppresses noise.
≤ The Pont de la Poya Bridge is 851.6 m long, with a total carriageway width of 19.25 to 22.15 m. From the Bellevue (Schoenberg qurter) approach the structure spans the River Saane some 70 m above the valley floor, linking Murtenstrasse (connecion to A 12) with Bernstrasse through the tunnel and the roofed gallery, which are under construction.
≤
The four-lane Lausanne bypass was opened in 1970. The bypass forms a 7.7 km stretch of the A9 motorway between Villars-Ste-Croix and Vennes. In the summer of 2011 Implenia replaced the asphalt road surface between the Pont de la Sorge Bridge in Villars-Ste-Croix and the Vennes exit (Lausanne). The work took two months and was carried out at night.
107 metres up – but no vertigo In the Canton of Fribourg the 851.6 metre long Pont de la Poya Bridge, one of Switzerland’s most impressive feats of engineering, is taking shape: two steel and concrete approach bridges and, running between them, an inclined cable-stayed cantilever bridge at both endings hung from two needleshaped pylons rising to a height of 107 metres. At 196 metres, the cabletensioned section of the Pont de la Poya Bridge is the longest pillar-free span in Switzerland. It poses a challenge in terms of both engineering and safety. The mixture of materials used, the technique and the height above ground are “demanding”, admits Thierry Progin, Head of the Implenia branch office in Fribourg. Pouring the concrete and spanning the cables at a height of 107
metres have also placed serious demands in terms of ensuring the safety of the 42-strong team of highly experienced, vertigo-free bridge builders.
“The mixture of materials used, the technique and the height above ground are challenging.”
The project has had an extremely difficult birth: it has taken 50 years to begin construction of the Pont de la Poya. In the autumn of 2010 the foundation stone was finally laid by members of the Governing Council of Canton Fribourg, cantonal engineers and representatives of the project’s chief contractor and sub-contractors. Construction work began in November 2009. It will be in late
Thierry Progin, Head of the Implenia Infrastructure Construction branch office in Fribourg
The visually imposing Pont de la Poya Bridge is the kingpin of an infrastructure project costing around CHF 200 million, the aim of which is to improve quality of life in the town of Fribourg. The beautiful old town centre – the castle district – was in danger of suffocating to death from the daily traffic of around 25,000 vehicles. The project also involves the construction of a tunnel and two intersections. Motorists will be able to use the Pont de la Poya to cross the River Saane. A 251-metre tunnel will then channel them under the Palatinat Park and the SBB rail tracks. The Pont de la Poya has four lanes: three carriageways for motor vehicles and a separate lane for pedestrians and cyclists. The town of Fribourg is being relieved of its traffic burden while enhancing the mobility of its population. “The Poya project will satisfy the long-held aspirations of the people and authorities of Fribourg”, says Giancarla Papi, Head of the Construction and Planning Office of Canton Fribourg.
2014 at the earliest before the first cars drive over the bridge. Interested parties can take part in a guided tour to visit the construction site or can follow it on webcam (www.pontpoya.ch).
Implenia leads consortium The CHF 56 million Pont de la Poya Bridge is being built by a consortium of three firms. With its 40% stake, Implenia leads the consortium and is responsible for the technical and operational supervision, with Implenia Infrastructure Construction handling 70% of the engineering and construction work. Night shifts on the A9 Every day the six-lane Lausanne bypass section of the A9 is used by 90,000 vehicles. The 7.7-kilometre stretch between Villars-Ste-Croix and Vennes is thus one of the most heavily used sections of motorway in Switzerland. In 2011 the stretch was resurfaced. The cost and deadline constraints made the job a very challenging one for Implenia’s Vaud profit centre. “The size of the job and the smooth cooperation between our various branch offices in western Switzerland do great credit to Implenia in French-speaking Switzerland,” says Olivier Mouron, Head of Civil Engineering for the Western Switzerland Region. To ensure that traffic flows on the stretch of motorway were not impeded, the work was carried out exclusively at night for the duration of the two-month project. The old road surface was removed and replaced with a "open-pore asphalt"(PA 11). Unlike traditional asphalt, where the mineral
content melts together with bitumen to form a compact mass, the open-pore surface has a rough granular consistency. Thanks to tiny spaces between the granules there is only a very thin film of water. Thus, traffic noise is absorbed.
Implenia’s innovative asphalt products Implenia doesn't just work out on the roads themselves. In the background the Implenia laboratory has been researching traffic noise for many years now, analysing and refining the recipes for asphalt products available on the market by adding in recycled materials such as gravel and sand or rubber and trying out other types of resinous or binding substances. Together with Sapa SA (a joint venture between Implenia and Walo Bertschinger) the Implenia laboratory has developed the low-noise road surface “Sapaphone” (a trademark), which achieves much improved results. Sapaphone reduces traffic noise by around 9 decibels, or three times as much as required by the Federal Office for Roads (ASTRA) and the Federal Office for the Environment (BAFU). In 2010 more than 2000 tonnes of Sapaphone asphalt were laid on Swiss roads. The Implenia laboratory is monitoring the behaviour of these Sapaphone surfaces to gather information on the product’s long-term stability.
Pont de la Poya Bridge – facts and figures Commissioned by Civil Engineering Department, Canton of Fribourg Chief contractor Groupement MPP p/a GVH Saint Blaise Cost CHF 56 million Total length 851.6 m Length of central span 196 m Height 107 m Concrete used 16,000 m3 Reinforcement rods 2,800 t Steel 3,539 t Excavated material 44,000 m3 Anchor piles 720
A9 – facts and figures Commissioned by Chief contractor Implementation Tender amount Bypass surface area removed Trial surfacing removed Weight of material removed PA 11 surfacing laid AC MR 11 surfacing laid No. of nights worked No. of personnel per night
Federal Office for Roads ASTRA CSD Ingénieur M. Saugy Implenia Infrastructure Construction, Echandens CHF 18.1 million 250,000 m2 19,000 m2 40,000 t 21,000 t 4,200 t 44 100
“The A9 job is a flagship project for Implenia in French-speaking Switzerland.” Olivier Mouron, Head of Civil Engineering, Western Switzerland Region
30–31
Apprentices talk to the CEO
“Details make the difference”
Implenia is very serious about promoting new talent and training young employees. More than 200 apprentices – in office jobs and on site – are currently learning their trade with us. Why did they come to Implenia? And what have they always wanted to ask the CEO about? Anton Affentranger met five young people for a discussion.
Apprentices Deborah Bazzanella, Sheila Gehringer, Kevin Rumo, Daniel Kaldis and Joel Vollenweider (left to right) talk to Anton Affentranger.
He certainly felt a bit nervous; after all, it’s not every day that an apprentice gets the opportunity to talk to Implenia’s CEO, says 17-year-old Daniel Kaldis. The carpentry apprentice in his first year of a BMS course (an academic course running in parallel with a practical apprenticeship) is simultaneously training with Implenia’s Wooden Construction Department in Rümlang. Together with his colleague Joel Vollenweider (17), a second-year carpentry apprentice, he has come to Dietlikon on this cold January morning to join the discussion. The other participants are already waiting on the sixth floor of Implenia’s head office building, usually home to strategic Board meetings and intensive Executive Committee sessions. One of those already there is 20-year-old Sheila Gehringer. She has already been able to gain experience in various departments, including the IT help desk in Oerlikon and the Human Resources Department in Aarau. The fact that her mother is called Margrit – which also happens to be the German name for Implenia’s “daisy” logo – is not, of course, the only reason why she chose to train at Implenia (Affentranger’s deep laugh rings out, and not for the last time during the hour-long discussion). The main things she likes about Implenia are its size, the large number of exciting projects and the opportunity to work with different people. Deborah Bazzanella, a 19-year-old commercial apprentice in the second year of an “E-Profil” course (expanded basic training), nods in agreement and says that she can’t think of another company that offers such a varied insight into working life. She is currently working in Dietlikon for Implenia General Contracting.
32–33
apprEnticEs talK to tHE cEo
“The training course at Implenia is interesting and varied.” Sheila Gehringer, 20, commercial apprentice, Implenia Corporate Center / Human Resources, Aarau
varied insights into working life “Rotation is a central principle for office-based apprentices,” explains Andrea Wyss, who is in charge of commercial apprentices at Group level. “We want out apprentices to see what life is like in all sorts of different areas. This helps them apply the theories they have learnt at school to a wide variety of practical situations. It also helps the apprentices work out which areas they might want to consider for a future career.” Back on the sixth floor, Kevin Rumo, from Fribourg, is introducing himself. The site-based apprentice, now in his third year of training, proudly tells the room that he works on a road construction site in Fribourg. But that he still hasn’t been to the Poya Bridge, one of Implenia’s biggest flagship projects in the region. Affentranger wonders if he had to get up particularly early to come to Dietlikon this morning. No, replies Rumo, only at 7 a.m., which is practically a lie-in for him.
Anton Affentranger: How have you liked training at Implenia so far? Sheila Gehringer: It’s exciting and very varied. Daniel Kaldis: Yes, and we have a super team, great people and a good atmosphere. Joel Vollenweider: I think the most exciting thing is that as an apprentice you can work on the large-scale contracts that Implenia gets. Smaller firms just can’t offer this opportunity. I might be working next on the planned residential development in Mellingen [editor’s note: scheduled to be the biggest Minergie-A housing estate in Switzerland], that would be really exciting! Anton Affentranger: Is there anything that we could be doing better? Apart from paying you more.... (Affentranger grins and the apprentices laugh loudly.)
Daniel Kaldis: You could improve the apprenticeships by asking more of the apprentices. We could be given challenging work earlier. It would also be better for the company if it gave the apprentices more responsibility and more independence earlier. practice and theory come together More than 200 apprentices are currently at Implenia, preparing themselves for a wide variety of professional careers. They include construction equipment mechanics, builders, foundation engineers, heating technicians, ventilation technicians, plumbing technicians, bricklayers, mechanics, joiners, road-builders, transport infrastructure engineers and carpenters. Andrea Wyss explains: “We want to identify good new talent early and, depending on how mobile they are, give them the most suitable placements. Most apprentices will be given a job at the company after they have finished their course.” This fluid transition from training to working life is one of the things that makes the parallel training system, with is equal weighting of theory and practice, such a successful model. Switzerland has one of the lowest rates of youth unemployment in Europe. At 3.4%, the percentage of young people out of work is only marginally higher than the overall jobless rate (source: Seco, “Die Lage auf dem Arbeitsmarkt”).
Anton Affentranger: Can you imagine working for Implenia later on? Deborah Bazzanella: Yes, certainly. If there’s an opportunity, of course. I would be interested to know how you see your role as CEO.
“I think it’s great that as an apprentice you can work on the large-scale contracts that Implenia gets.” Joel Vollenweider, 17, second year of training as a carpenter, Implenia Wooden Constructions, Rümlang.
Apprentices talk to the CEO
Anton Affentranger: I always say that the CEO is the one who ends up fielding the problem. Complaints of all types, internal and external. Not that we have too many of them, but they do occur from time to time, and that’s what I’m here for. If problems can’t be solved, they end up with me. My job is to ensure that everything is running, that the organisation is working properly, and that the people can work together well. I am responsible for ensuring conditions that allow everyone in the Group to progress and do their job as well as possible. I also work to create a good atmosphere and help foster a fighting spirit among staff. And finally, one of my goals as CEO is to make sure that we all uphold our company values and adhere to our Code of Conduct. Deborah Bazzanella: What do you do if employees don’t comply with our Code of Conduct? Anton Affentranger: First and foremost it was important for me to introduce the Code of Conduct at Implenia, and communicate it so that every single employee understands it – from Executive Committee, to department managers, to employees, to apprentices... Daniel Kaldis: May I ask what it’s about? Anton Affentranger: (laughs) I see we already have a few follow-up tasks! But to answer your question: the Code of Conduct can be seen as our constitution. It’s where we define how we want to behave as a company towards our clients, the general public and our employees. In short, these are the rules of behaviour that we want to follow. For all of us the Code of Conduct serves as a guide in our working lives. Every employee – including apprentices – has signed to say that they have read, understood and accepted the points contained in the Code.
“I learned my French on the building site.” Kevin Rumo, 18, road construction apprentice, Implenia Infrastructure Construction, Freiburg i. Ue.
34–35
Deborah Bazzanella: But we still had to pay a fine for what happened in Canton Aargau. Anton Affentranger: Yes, that’s true. We were fined because businesses in Aargau made agreements with each other, thus contravening the principles of the free market. Implenia is clearly committed to free and unfettered competition. In fact this is stated in the Code of Conduct. We now take a zero tolerance policy towards anyone who infringes the Code of Conduct. Anyone who so seriously contravenes our principles will lose their job. As the largest construction firm we have a particular responsibility and must set an example of impeccable behaviour. Encouraging an international mindset even among apprentices At its 2011 Apprenticeship Conference, Switzerland’s Federal Office for Professional Education and Technology (OPET) wrote the following: “The globalised world of work presents new challenges in professional education. Occupational mobility is becoming a key success factor for today’s workers and for the competitiveness of Swiss companies. Given this situation, mea sures are required that make it easier for apprentices to move around with their work and thus prepare them in the best possible way for the requirements of working life.” Implenia’s role as an international company, and the opportunities and challenges of globalised working are also subjects that preoccupy our apprentices.
Anton Affentranger: Mr. Rumo, it’s mainly French speakers who work at our unit in Freiburg isn’t it? How is your French? Kevin Rumo: They mainly speak French on the building site, so I learned it quickly. This is a big advantage for me because it makes things much easier at school. Anton Affentranger: It will benefit you not only at school but in your later working life. Languages are the key to being able to work all over the world – if that is what you would like. Joel Vollenweider: Do you know a lot of languages? Anton Affentranger: I grew up bilingually in South America, learning German and Spanish. I still only speak Spanish with my brother. Then I studied in Geneva, which is where I picked up French. And I feel pretty comfortable in English too. Joel Vollenweider: A couple of people in our department recently went to Germany to finish off some shuttering work on site. Will Implenia be doing more work abroad in future?
36–37
Apprentices talk to the CEO
“In order to deploy our expertise internationally, we need employees who are mobile and who are prepared to look for opportunities outside Switzerland too.” Anton Affentranger, CEO
Anton Affentranger: Yes, I think that will definitely happen. As I’m sure you know, we are running a huge construction site at the moment in Switzerland for the NEAT project, with lots of very highly skilled people working on the tunnelling. But the NEAT work is coming to an end soon. The aim of our international strategy is to utilise the experience and expertise of the people currently working on NEAT and similar projects by giving them opportunities abroad. We already have two projects in the Middle East: in Abu Dhabi and Bahrain. They both involve microtunnelling – small tunnels with a maximum diameter of 1.2 meters, often used for things like waste-water systems. We are currently hoping to win a third contract in Dubai. We are also building one of Italy’s tallest buildings at the moment, the Bank Intesa Tower in Turin. And in August we bought a company in Norway. We have high hopes for this acquisition. Do you know which three departments at Implenia worked over the Christmas break? Sheila Gehringer: I would guess the accounts department to prepare for the annual results and HR Administration. Anton Affentranger: Correct, and the other department was our operation in Norway. Our new colleagues have so many projects for which they have to prepare offers that they had barely any time for a holiday. Our dream is for us to be able to deploy our people in Switzerland internationally. But it’s not easy. Daniel Kaldis: I’d go straight away! Anton Affentranger: (laughs) I believe you. But let me give you an example: for the Turin Tower project, which we started work on about a year and a half ago, it was very difficult to find people in Switzerland who wanted to go to Italy. I remember a 35-year-old project manager who would have been perfect for the job. But for personal reasons he didn’t want to leave Switzerland. Precisely when it comes to exporting our Swiss quality to other countries, it is vital that we also have Swiss people on the ground who can use their expertise and experience. This means, however, that people have to be mobile and have to want to seize the opportunity. What I mean to say to you is this: you are all still right at the start of your career. Be aware that there are opportunities not just in Switzerland, but internationally. Deborah Bazzanella: What brought you back to Switzerland?
Anton Affentranger: I think it’s a great country. On every trip, and every time I work abroad, I always realise: we have it good in Switzerland. So I think we should look after what we have here, though always remaining open to the world and to new things. It’s like at Implenia: there are of course things that we could do better, but we can be proud of the quality we achieve and of the way we work. Values like reliability, punctuality, precision, quality – these are all very strongly associated with Switzerland for me. I believe we have a responsibility to nurture these values. Quality counts As the discussion continues, Sheila Gehringer wants to know how many building sites Mr. Affentranger has visited. Affentranger asks back: how many building sites does Implenia have in Switzerland. Blank looks. And then the figures start pouring out: 100; 1,500; 2,000; 2,500. There are a total of 4,000 construction sites in Switzerland alone, Affentranger confirms – and this doesn’t include the international units like Norway. Joel Vollenweider wonders if he can really maintain a clear overview of so many projects. And soon the discussion turns to working hours and how many are needed to do all the work a CEO needs to do.
“I’d go abroad straight away!” Daniel Kaldis, 19, first year of training as a carpenter, Implenia Wooden Constructions, Rümlang.
38–39
Apprentices talk to the CEO
Daniel Kaldis: How many hours do you work on average each week? Anton Affentranger: I don’t know. For me it’s not a question of work time and leisure time. Everyone these days talks about work-life balance, but I rarely think about how much exactly I have worked. The important thing for me is that I enjoy doing what I do, whether it’s working, cooking or running a marathon. If you do something that you don’t actually like doing, then you have to correct the situation – because as far as I’m concerned, every minute that you spend doing something you don’t like is a minute too many. Sheila Gehringer: But there must be moments when you simply have too much to do and reach the end of your tether, even if you basically enjoy the work… Anton Affentranger: There are certainly moments when you reach your limits. We had a situation like that last autumn when the management changes happened. We had to make some far-reaching decisions very quickly. It was similar when the “Letzigrund” issue was at its height. You have to remember how serious it was: people were saying that a structure we had built was not safe and could be about to collapse. Even though we knew this was far from the reality and had numerous expert reports clearly stating that the opposite was true, it is not easy to cope with such accusations. Then there was the media, which wrote all about it and built up an enormous amount of pressure. Often it’s not about the matter itself, but more about the people involved. And in times like that you realise how important it is to have a good professional, but also private and family, environment to support you.
“Often it’s the details that decide whether a project or a contract bid is successful or not.” Anton Affentranger, CEO
“If I get the opportunity, I can easily imagine continuing to work at Implenia after my apprenticeship." Deborah Bazzanella, 19, commercial apprentice, Implenia General Contracting, Dietlikon
Deborah Bazzanella: What characteristics do you believe are important for an Implenia employee? Anton Affentranger: It’s important that everyone knows and understands what it is to be a service provider. For example, they have to understand that the details are important. This holds for your day-to-day work, whether it’s in accounts, on the building site, or in the carpenters shop, Mr. Kaldis and Mr. Vollenweider. Often it’s the details that make the difference between success and failure. To ensure the customer is happy, everything has to be right. It’s the same for every construction project. The result is what counts. You asked me earlier how much I work. I think the more important thing is that whenever we work, and for however long, we do it right. That is my basic philosophy. Sometimes it means having to go the extra mile. Last weekend, for example, we worked on a presentation until everything was perfect down to the very last dot on the last “i”. It was nerve-wracking, but we had an important customer pre sentation on the Monday morning. And if I could leave you with any message today, it would be this: ensuring that the very last detail is right requires commitment and passion. I very much hope that I have been able to kindle a little of that flame in you. Affentranger admits that he is hard to please, and he knows that this can sometimes be hard to take. His family could tell a few good stories about it. When he was checking his youn ger son’s essay the other day, he made so many corrections that the student protested and said he’d never give his father any work to look at ever again. A sigh of sympathy goes round the table; it’s clear the apprentices identify with the son. But they all grin and when the time comes to say goodbye it’s clear that Deborah, Sheila, Joel, Daniel and Kevin are going back to their workplaces feeling stronger and more motivated. Text and moderation: Philipp Bircher
40–41
Annual report 2011
Consolidated profit (in CHF million)
61.4 57.2
52.5 40.0
47.1
2.4%
4% 2.2%
20 2%
6%
23.2
40.0 30
1.7%
3.7%
3.3%
3.0%
2.6%
4%
40 25.5
6%
8%
40.9
77.7 58.3
50
57.1
67.6
60
1.1% 22.0
20
1.6% 32.8
40
38.7
60
70
8%
35.3
59.0
80
10%
81.4
100
2.1%
93.7
Operating income (in CHF million)
2%
Stable construction market The construction market in Switzerland performed robustly again in 2011. Civil engineering was one of the main drivers as the sector continued to benefit from major public sector infrastructure works. The only decline was recorded in the tunnelling business, which was a result of NEAT work coming to an end. The other main driver was the positive trend in residential construction: low interest rates and migration into Switzerland mean there is a demand for new homes. Meanwhile, investment in commercial and industrial building work was subdued. Companies’ caution in the wake of the European debt crisis was plain to see in this segment. Although the construction market as a whole grew, prices in individual segments remained under pressure. The healthy level of construction activity also had an effect on the labour market. Employment figures reached a record high, and there were shortages of some specialist personnel.
4.2
12.5
2010
0%
2011
6.2
2009
16.8
12.3
2011
2008
19.4
2010
0
3.5
10.5
2009
2nd half-year Sale of Privera CHF 11.3 million 1st half-year margin
0%
2007
23.7
2008
EBITDA, operating result and consolidated profit for the 2011 financial year are all excellent. The Real Estate Division recorded a very good business performance and gained further momentum in the Project Development business. Industrial Construction achieved an outstanding result. With the acquisition of the Norwegian company Betonmast Anlegg, Implenia has created an additional platform from which to exploit its international growth potential. At Infrastructure Construction, important steps were taken towards sustainable profitable growth. The Group’s full order book gives reason to be confident about the current year.
0
5.9
A successful 2011 for Implenia
2007
10
2nd half-year Sale of Privera CHF 11.3 million 1st half-year margin
Consolidated key figures 2011
2010
CHF 1,000
CHF 1,000
2,441,202 81,444 2,522,646
2,388,418 – 2,388,418
2.2%
EBIT divisions
93,529
76,997
21.5%
Operating income
93,676
77,658
20.6%
Consolidated profit
61,351
52,458
17.0%
140,489 67,311
112,552 39,920
24.8% 68.6%
18,472,000 18,292,994
18,472,000 18,260,983
– 0.2%
Consolidated revenue (excl. Norway) Revenue Implenia Norge 1 Consolidated revenue
EBITDA Free cash flow Number of shares Outstanding shares 1 from 18.07.2011
∆
5.6%
42–43
Annual report 2011
Free cash flow
EBITDA (in CHF million)
169.1
12%
200 150
67.3
5.6%
50
39.9
100 92.7
8%
2.4% (2010: 2.2%). The disproportionately large improvement in income is due to the growth in the high-margin Project Development business, better final earnings from general contracting projects due to optimised project management, and strict cost and risk management. As well as outstanding operating results, the settlement between Consorzio TAT and ATG (AlpTransit Gotthard) made an additional positive contribution to earnings (details on page 59).
0 4%
–50
30
–113.3
112.6 76.0 4.7%
75.5 4.6%
98.5 54.8 4.2%
60
3.6%
60.5
90
84.7
120
104.6
150
111.1
140.5
(in CHF million)
2011
29.4
2011
2010
36.6
2010
2009
29.1
2009
–150 2008
43.7
2008
2nd half-year Sale of Privera CHF 11.3 million 1st half-year margin
0%
2007
24.2
0
2007
–100
Cash flow from operating activities Cash flow from investment activities Free cash flow
High cash flow and a solid capital base Free cash flow was up at the healthy level of CHF 67.3 million (2010: CHF 39.9 million). This is a product of a good business performance as well as strict management of net working capital (NWC) and liquidity. Implenia financed the Betonmast Anlegg acquisition and the investments made to strengthen the project development portfolio (“Unterfeld”, “Wrighthouse”, “The Metropolitans”) entirely from current cash flow. Meanwhile, in accordance with its strategy the Group sold investment properties from the Sulzer portfolio that did not fit its strategic focus. This freed up previously committed capital. Key balance sheet figures
Best result in Implenia’s history The Implenia Group can look back on a successful 2011. Excellent figures were recorded for all key benchmarks. Group revenue increased 5.6% to CHF 2523 million (2010: CHF 2388 million). CHF 81.4 million of this, or 3.2%, can be attributed to newly acquired Norwegian company Betonmast Anlegg (Implenia Norge). Two of the divisions, Real Estate and Industrial Construction, posted an excellent business performance. Infrastructure Construction failed to meet expectations in the first half year, but in the second half of 2011 the division matched the good performance of the equivalent period in the previous year. With a package of measures aimed at strengthening customer focus and risk management, the Infrastructure Construction Division set the course for sustainable profitable growth. EBITDA, the operating result and consolidated profit were all significantly higher than in the previous year: EBITDA went up 24.8% to CHF 140.5 million (2010: CHF 112.6 million), operating earnings rose 20.6% to CHF 93.7 million (2010: CHF 77.7 million), and consolidated profit increased 17.0% to CHF 61.4 million (2010: CHF 52.5 million). Thus, Implenia has clearly improved its margins again. The EBITDA margin is now up at 5.6%, compared with 4.7% in 2010. The operating income margin is 3.7% (2010: 3.3%) and the consolidated profit margin
2011
2010
CHF 1,000
CHF 1,000
Cash and cash equivalents Real estate transactions Other current assets Non-current assets Total assets
402,532 247,047 820,059 418,065 1,887,703
349,274 217,983 734,230 375,516 1,677,003
15.2% 13.3% 11.7% 11.3% 12.6%
Financial liabilities Other liabilities Equity Total equity and liabilities
209,073 1,135,102 543,528 1,887,703
199,760 981,759 495,484 1,677,003
4.7% 15.6% 9.7% 12.6%
193,459
149,514
29.4%
Investments in real estate Investments in fixed assets
76,459 38,720
50,848 39,496
50.4% (2.0%)
Equity ratio
28.8%
29.5%
(0.7%)
Net cash position
∆
44–45
Annual report 2011
Return on invested capital (ROIC) (in %) 600
500 400
350.1 26.8%
346.0
340.4
2011
2010
2009
2008
0% 2007
2011
2010
20%
9.5%
9.3%
9.4%
9.4%
7.4%
Cash Debt Net cash position
2009
2008
0 2007
–300
30%
10%
100
–200
22.4%
15.3% 9.6%
200
40%
19.9%
386.6
149.5
400
300
–117.3
–100
36.7
100
85.9
200
193.5
500
300
0
50%
522.2
Net cash position (in CHF million)
Invested capital (in CHF million) ROIC (operating income / invested capital) WACC before tax
Confident outlook for 2012 Construction activity in Switzerland will probably continue this year in much the same vein as 2011. Driven by stable demand from the public sector, there is likely to be a similar volume in the civil works sector as in 2011. Momentum should be maintained in the residential construction market. These trends will ensure that the market environment remains healthy, though price pressure will continue. The Group’s order book has been maintained on a high level and, thanks to the acquisition of Norwegian company Betonmast Anlegg, increased by 2.7%. Incoming orders improved significantly especially in the final quarter of 2011, partly because of more intense customer care. Given the high level of orders, stable construction activity, and a noticeable sense of forward momentum within the Group, Implenia expects another positive business performance in 2012. At the Real Estate and Industrial Construction Divisions, the task will be to confirm 2011’s good results. Implenia will concentrate on exploiting the high growth potential in international infrastructure construction and in project development. The Infrastructure Construction Division will concentrate on profitable orders and press ahead with the measures that have been initiated to intensify customer care and improve efficiency. Based on its integrated business model and its collaboration across all areas of the company, Implenia will continue to build up its market position and also compete successfully on price.
Invested capital
As at 31 December 2011, the company held net cash of CHF 193.5 million, compared with CHF 149.5 million at the end of 2010. The expansion of foreign business and the investments made in new projects pushed total assets up to CHF 1888 million (2010: CHF 1677 million). The equity ratio moved down slightly from 29.5% at the end of 2010 to 28.8%. Implenia thus continues to boast a very solid equity base by industry standards. Implenia creates sustainable value In 2011 Implenia again increased its return on invested capital (ROIC). This now stands at 26.8% compared to 22.4% in the previous year. The weighted average cost of capital (WACC) of 9.5% was thus exceeded by 17.3 percentage points before tax. This means that Implenia once again created significant value. Invested capital stayed virtually unchanged despite the acquisition of Implenia Norge and the investments in development projects. There was a disproportionately large improvement in profitability, which led overall to the increase in ROIC.
Current assets excl. cash and cash equivalents Non-current assets Less debt capital (excl. financial liabilities) Total invested capital
2011
2010
CHF 1,000
CHF 1,000
1,067,106 418,065 (1,135,102) 350,069
952,213 375,516 (981,759) 345,970
12.1% 11.3% (15.6%) 1.2%
∆
∆
Operating income
Total operating income
2011
2010
CHF 1,000
CHF 1,000
93,676
77,658
20.6%
46–47
419
3,154 329 905
875
1,552
1,488
1,437
1,354
1,394
3,000 2,000
2,513
2,500
808
2,959
3,445
4,000
695
2,777
2,716
3,000
2,637
(in CHF million)
2,542
Order book
(in CHF million) 2,705
Production output
3,070
Annual report 2011
2,000
1,500
2nd half-year 1st half-year
1,875
1,843
1,920
2010
2011
2008
2007
2011
2010
2009
2008
0 2007
0
2009
1,000
1,225
1,228
1,200
1,188
500
1,310
1,000
Total order book Revenue in third subsequent year et seq. Revenue in second subsequent year Revenue in subsequent year
Production output is made up of consolidated revenue and the relevant portion of net revenue from our joint ventures.
Production output
Real Estate Infrastructure Construction Tunnelling Implenia Norge 1 Prime Buildings Various / elimination of intra-group services Total production output 1 from 18.07.2011
2011
2010
CHF 1,000
CHF 1,000
1,414,880 1,288,224 274,871 81,444 19,759 (302,512) 2,776,666
1,310,500 1,344,886 335,572 – 13,989 (288,742) 2,716,205
∆
Order book 8.0% (4.2%) (18.1%) 41.2% (4.8%) 2.2%
Real Estate Infrastructure Construction Tunnelling Implenia Norge Prime Buildings Total order book
2011
2010
CHF 1,000
CHF 1,000
1,616,139 744,157 592,403 126,529 74,687 3,153,915
1,663,196 712,278 598,959 – 95,881 3,070,314
∆
(2.8%) 4.5% (1.1%) (22.1%) 2.7%
48–49
REal Estate
Key projects
Monséjour housing estate, Fribourg Implenia is building 112 rental apartments for its client Suva right in the heart of the Swiss city of Fribourg (picture). Implenia is also building the Prés de l’Île residential development in Martigny for the same client and Groupe Mutuel. Here in the Lower Valais the Real Estate and Infrastructure Construction divisions are creating 96 owner-occupied and rental apartments. “Coupe Gordon-Bennett” in Vernier is another key project where Suva is relying on Implenia’s expertise. Wrighthouse, Glattpark / Opfikon Thanks to its location, the “Wrighthouse” development that Implenia is building at Glattpark will act as the link between the Glattpark district of Opfikon and the city of Zurich. This key urban project, with 122 owner-occupied and rental apartments, is worth approximately CHF 80 million. Riedmühlepark, Dietlikon On a piece of former industrial wasteland in Dietlikon, 76 owner-occupied and 43 rental apartments are being built. With an investment of around CHF 85 million, Implenia is realising this highend project in accordance with the Minergie-P standard.
Real Estate Division
Real Estate looks back on a successful 2011. In the second half of the year the division achieved the best half-year result in its history. This was made possible by a larger contribution from the high-margin Project Development business, and a very good result in General Contracting. The Real Estate Division, with its General Contracting / Services and Real Estate (Project Development) units, recorded a very good business performance in 2011, increasing its revenue by 8.0% year-on-year to CHF 1415 million. EBIT increased disproportionately by 23.8% to CHF 45.0 million. Order volumes were maintained at around the previous year’s high level at CHF 1616 billon. General Contracting / Services posts record result General Contracting / Services posted a record year, increasing EBIT by 27.8% to CHF 19.7 million (2010: CHF 15.4 million). The EBIT margin rose from 1.4% to 1.7%. One reason for the better operating performance was the effective project and risk management. Implenia again won a series of important General Contracting orders, thanks in particular to its outstanding acquisition work in Western Switzerland. Examples include the new conference hall at the
Key figures Real Estate
Revenue EBIT General Contracting / Services EBIT Real Estate (Project Development) EBIT Order book Headcount (FTE)
2011
2010
CHF 1,000
CHF 1,000
1,414,880
1,310,500
8.0%
19,659 25,297 44,956
15,385 20,925 36,310
27.8% 20.9% 23.8%
1,616,139 482
1,663,196 464
(2.8%) 3.9%
∆
50–51
REal Estate
1.0%
5
25.3 21.4 17.2
15.4 10.3
9.0
9.1
4.2
10.3
8.9
2010
2011
9.4
2011
0
2009
6.1
2010
0%
1.2
9.1
2009
2nd half-year 1st half-year EBIT margin
4 2
2008
6.6
2008
0
3.6
East Zurich Central West Reuss Engineering, all of Switzerland
2007
General Contracting / Services – residential General Contracting / Services – commercial General Contracting / Services – infrastructure Real Estate (Project Development) Reuss Engineering
8 6
0.5%
12 10
6.4
18.4%
14
16.4
10.3 1.7%
1.5%
16
2007
36.6%
2%
18
20.9
2.5%
24
10.6
9.3
19.7 15.4
22
1.4%
10.2 10
3.0%
0.9%
29.1%
6.6
8.2%
26
20
8.9
15
1.4%
39.4%
37.9%
EBIT Real Estate (Project Development) (in CHF million)
3.5%
17.4
20
11.8%
8.3
1.3%
1.3%
EBIT General Contracting / Services (in CHF million)
15.5
16.1%
Production output 2011 by region
1.6%
Production output 2011 by business segment
2nd half-year 1st half-year
headquarters of the World Intellectual Property Organisation in Geneva, the new office building for insurance company CSS in Lausanne, and the “Monséjour” residential development in Fribourg. Highlights in German-speaking Switzerland included winning contracts for Plot E of the “Europaallee” project in Zurich and for Parktower in Zug. Reuss Engineering, which specialises in engineering and sustainability issues, continued to expand its business.
“Implenia acquired several attractive development projects in 2011. This not only secures future business volumes in Project Development but, thanks to the Group’s integrated business model, in General Contracting and Construction too.” René Zahnd, Head of Real Estate Division
Full pipeline for Project Development The Real Estate (Project Development) unit exceeded the previous year’s good result and increased EBIT by 20.9% to CHF 25.3 million (2010: CHF 20.9 million). This pleasing outcome confirms that the chosen strategy is the right one. A broad-based Project Development portfolio ensures good business volumes and operating results in the medium and long term. At the same time it helps increase the proportion of internally generated general contracting and construction orders. The portfolio includes projects like “Coupe Gordon-Bennett” in Geneva and “Rosengarten” in Arbon, which have already been running for some time. In addition, Implenia invested in several major new development projects in 2011, including “Wrighthouse” in Opfikon, “The Metropolitans” in Zurich, and “Unterfeld” in Zug / Baar. Implenia is also building the “schorenstadt” housing estate in Basel – a beacon project for the 2000-Watt Society. In Winterthur, various projects were taken forward as part of the development of the former Sulzer sites in the city centre and in Neuhegi. With three sales (buildings and / or properties), Implenia was also able to dispose of non-strategic positions, thus freeing up capital.
52–53
INFRASTRUCTURE CONSTRUCTION
Key projects
Expansion of power station, Rheinkraftwerk Iffezheim (Germany) Thanks to the integration of a fifth turbine, the Rhein kraftwerk Iffezheim power station will produce CO2-free electricity for 540,000 people. Following this expansion, Iffezheim, 30 km south of Karlsruhe on the border between Germany and France, will be the largest run-of-the-river hydro plant in Germany. Rheinkraftwerk Iffezheim GmbH has commissioned a consortium consisting of Implenia and the German company Schleith GmbH to handle the construction work required. Implenia is bringing its expertise in civil engineering and foundation engineering to the proje ct. (Picture) Hotel “Bell Rock”, Europa-Park in Rust, near Freiburg (Germany) The fifth “experience hotel” in Germany’s biggest theme park is being built in a “New England” style. Implenia has been contracted to complete the whole project ready for turnkey handover. The general contractor work and shell construction is being handled by Implenia’s German branch in Rümmingen. AlpTransit lot 026 Stägwald retaining wall, Erstfeld The Stägwald retaining wall protects the line between Erstfeld and the northern entrance of the Gotthard base tunnel. Implenia used a total of 17,000 m3 of concrete for the base plates and wall sections.
Infrastructure Construction Division
After a difficult first half of 2011, in the second half the Infrastructure Construction Division performed close to the previous year’s good level. With measures taken to strengthen building construction and with a solid order book, the division is looking to the future with confidence. In 2011 the Infrastructure Construction division generated revenue of CHF 1148 million, which is 4.4% lower than in the previous year (2010: CHF 1201 million). EBIT was 27.9% below the previous year’s figure at CHF 18.1 million (2010: CHF 25.1 million). The EBIT margin was 1.6%, compared with 2.1% in the previous year. The order book was 4.5% higher at CHF 744.2 million (2010: CHF 712.3 million).
Key figures Infrastructure Construction
Revenue EBIT Production output Order book Headcount (FTE)
2011
2010
CHF 1,000
CHF 1,000
1,147,649
1,200,636
(4.4%)
18,100
25,117
(27.9%)
1,288,224 744,157 4,138
1,344,886 712,278 4,140
(4.2%) 4.5% (0.0%)
∆
54–55
INFRASTRUCTURE CONSTRUCTION
EBIT Infrastructure Construction
10
2.2%
2.2%
15
1.9%
20
18.1 30.9 1.6%
25.1 31.8 2.1%
24.6 32.0
30.4
25
27.9
30
21.5
35
24.4
(in CHF million) 4%
Production output 2011 by region
4.4% 13.3%
27.2%
3%
23.0%
44.4%
2%
3.0%
1%
14.2%
4.6%
5
37.9%
0%
14.0%
13.9%
–12.8
–6.7
–7.4
–6.0
–6.4
0 –5
Production output 2011 by business segment
–10
2011
2010
2009
2008
2007
–15
2nd half-year 1st half-year EBIT margin
Roads, civil works Buildings Civil engineering Operations and other
West East Central Alps Civil engineering, all of Switzerland International Other
Good second half-year During the first half year, the tight price situation in Building Construction and a series of projects that turned out not to be as profitable as expected led to a disappointing result. Implenia initiated comprehensive corrective measures in response. This immediate action had an effect and, combined with favourable weather conditions in the autumn, helped to produce a very good second half-year. However, as expected it was not possible to make up entirely for the first half, especially since there was also a base effect to contend with as a result of the very good second half-year in 2010. A good result was achieved in French-speaking Switzerland, showing the positive effect of Implenia’s Swiss-wide portfolio of projects. Course set for profitable growth The new “Building Construction German-Speaking Switzerland” business area was created within the Infrastructure Construction Division on 1 January 2012. Implenia has thus prepared the way to establish itself as the top company in the Building Construction business, and take a leading position in terms of closeness to customers and the market. A new central technical office supports and monitors all activities in the business area with regard to risk minimisation, project execution and cost calculations. Combined with centralised logistics, these measures have established a platform from which Building Construction activities can continue to make a positive contribution to operating results. Against this background and given the solid order book, the whole division is looking to the future with confidence.
“Building Construction has to contend with intense price competition. In 2011 the Infrastructure Construction division took action aimed at strengthening customer focus and efficiency, thus setting the course for solid earnings in the years to come.” Arturo Henniger, Head of Infrastructure Construction Division
56–57
Industrial Construction
Key projects
Nordenga Bridge, Oslo (Norway) The Nordenga Bridge has given Norway’s capital city Oslo a new landmark. The spectacular steel construction spans the numerous railway lines that run into the country’s biggest train station. It is a key element in a major urban development programme intended to take the main flow of traffic away from the coastline. Implenia built the impressive structure on behalf of Statens Vegvesen, the Norwegian government body in charge of public roads. Between the start of construction in February 2009 and the opening of the bridge in August 2011, the project used a total of 1,900 tonnes of steel and 4,200 cubic metres of concrete. (picture) Pumped-storage power plant, Nant de Drance, Emosson From 2017, the Nant de Drance pumped-storage power plant should help cover peak power use by the SBB’s rail operations and improve security of supply within the Swiss electricity grid. In 2011 the value of Implenia’s contract for the job went up by around CHF 110 million. Microtunnelling project, Al-Muharraq (Bahrain) The port city of Al-Muharraq in the Kingdom of Bahrain will soon have a new waste-water treatment plant. Implenia is bringing its great expertise in microtunnelling to the project and is responsible for constructing the waste water pipes.
Industrial Construction Division
Industrial Construction posted an outstanding result and benefited from excellent operating results from its Tunnelling business in Switzerland. In addition, a settlement was reached with AlpTransit Gotthard (ATG), which led to a positive profit contribution. The acquisition of Betonmast Anlegg and the associated expansion in the fast growing Norwegian infrastructure market represent a milestone in the implementation of the Group’s international strategy. The division has a solid order book thanks to new and additional contracts. Key figures Industrial Construction
Revenue (excl. Norway) Revenue Implenia Norge 1
Revenue EBIT Tunnelling (excl. Norway) EBIT Implenia Norge 1 EBIT Prime Buildings EBIT Production output (excl. Norway) Production output Implenia Norge 1
Production output Order book (excl. Norway) Order book Implenia Norge
Order book Headcount (FTE – excl. Norway) Headcount (FTE) Implenia Norge
Headcount (FTE) 1 from 18.07.2011 2 after integration costs and amortisation of intangible assets of CHF 2.7 million
2011
2010
CHF 1,000
CHF 1,000
181,185 81,444 262,629
166,024 – 166,024
33,590 (805) 2 (2,312) 30,473
18,639 – (3,069) 15,570
∆
9.1% 58.2% 80.2% 24.7% 95.7%
294,630 81,444 376,074
349,561 – 349,561
(15.7%)
667,090 126,529 793,619
694,840 – 694,840
(4.0%)
573 260 833
631 – 631
(9.2%)
7.6%
14.2%
32.0%
58–59
–3.1 –1.0
–2.3 –1.2 2011
11.5
2011
2010
11.5
2010
–7.9 –4.9
13.2
2009
–9
2009
17.1
2008
–8 0%
2008
12.0
–7
2007
12.3%
–6 10%
–2.1
–3.0
–3.4
–6.6 –3.2
–5
–4.1 –3.2
13.5%
17.8%
–4 20%
2007
2nd half-year 1st half-year EBIT margin
–2 –3
5 0
0 –1
18.6
11.2
22.1
9.4 17.4%
10
16.2%
15
40%
30%
7.1
20
10.1
25
24.4
30
26.5
35
–0.9
(in CHF million) 32.8
EBIT Prime Buildings
21.3
EBIT Tunnelling (in CHF million)
–1.1
Industrial Construction
1st half-year 2nd half-year
Industrial Construction almost doubled its EBIT to CHF 30.5 million (2010: CHF 15.6 million). The division benefited from an outstanding operating income from its Tunnelling business in Switzerland, as well as from the settlement reached on the Gotthard project between Consorzio TAT and AlpTransit Gotthard (ATG) (see page 59). Production output went up 7.6% to CHF 376.1 million (2010: CHF 349.6 million). The increase in revenue by 58.2% to CHF 262.6 million (2010: CHF 166.0 million) is mainly due to additional sales from the acquisition of Betonmast Anlegg (CHF 81.4 million). The order book stood at CHF 793.6 million at the end of
“I’m pleased about the outstanding results for 2011 and pleased that we were able to reach a settlement with ATG on the Gotthard issue. My thanks go to all our employees for their great efforts and dedication. I wish my successor Peter Preindl every success in his new function.” Luzi R. Gruber, Head of Industrial Construction Division
the year, 14.2% higher than at the end of 2010 (CHF 694.8 million). CHF 126.5 million of this is accounted for by Implenia Norge’s orders. Taking this effect into account, the order book in the core business of Tunnelling in Switzerland was kept up at the previous year’s level. This is pleasing given the fact that the Swiss tunnelling market is shrinking as work on the NEAT lots comes to an end. Peter Preindl, who joined Implenia’s Executive Committee on 1 October 2011, is the new Head of the Industrial Construction Division. Preindl took over as Division Head from Luzi R. Gruber, who retired on 1 January 2012. In addition, Rainer Preisshofen took over as Head of the Prime Buildings business unit on 1 January 2012. Industrial Construction is thus ideally positioned to master the strategic and operational challenges that lie ahead. Outstanding result from tunnelling in Switzerland, settlement with AlpTransit Gotthard (ATG) With an 80.2% increase in EBIT to CHF 33.6 million, the Tunnelling Unit posted an outstanding result. Tunnel construction business performed very well in Switzerland during the year under review. A settlement reached between Consorzio TAT and ATG about the Gotthard project produced an additional positive contribution. This settlement concerned approved supplementary payments for work done on the project worth around CHF 10 million. As a result of the settlement and the improved prognosis for final earnings, Implenia was also able to release accruals and deferrals that were no longer needed. The settlement ultimately concerns compensation for the extended delay in building installations and project organisation. The compensation will continue to have a positive effect on the consortium’s – and thus on Implenia’s – results in 2012 and 2013 too.
“With its expertise, its track record in Switzerland, and its strong local teams, Implenia has incredible potential to position itself successfully in international markets – including Norway’s growth market – in the years to come.” Peter Preindl, Head of Industrial Construction Division (from 1.1.2012)
60–61
Industrial Construction / Implenia in Norway
Production output 2011 by business segment
Implenia Norge in brief
Production output 2011 by region
Employees: 260 full-time equivalents 2011 revenue: CHF 121.4 million1 EBIT 2011*: CHF 2.5 million1 Locations: 5 (Oslo, Bergen, Stavanger, Alesund, Trondheim) Business areas: Tunnelling and infrastructure construction
5.4%
22.9% 22.9% 38.2%
NORWAY Trondheim (Stjørdal)
2.0%
33.5%
Ålesund
Bergen
75.1%
Oslo
Stavanger
Tunnels – NRLA (The New Rail Link through the Alps) Tunnels – other Implenia Norge Microtunnelling
Switzerland Other Norway
Basis established for growth in international tunnelling business International Tunnelling business progressed successfully in 2011. In the Middle East, Implenia started operational work on two microtunnelling projects in Abu Dhabi and Bahrain. A highlight of the financial year was the acquisition of Norwegian company Betonmast Anlegg. This acquisition marked a milestone in Implenia’s international strategy and, in tandem with its proven expertise in Switzerland, laid the foundations for the Group’s participation in the growth potential of the Norwegian tunnel and infrastructure market. In 2011 Implenia Norge generated EBIT of CHF 1.9 million. However, because of a CHF 2.7 million amortisation of intangible assets associated with the acquisition, the business unit reported a negative contribution to profit of CHF –0.8 million. Since October 2011, Betonmast Anlegg has been operating in the Norwegian market as Implenia Norge. Prime Buildings on track The Prime Building sector, which offers consultancy services at international level for challenging real estate projects, is performing to plan. The operating loss shrank again. The “Torre Turin” project contributed to results for a full year for the first time; additional contributions to profit were generated by consultancy orders in Russia.
Exploiting potential in the far north
The acquisition of Norwegian company Betonmast Anlegg in July 2011 marked a milestone in the implementation of Implenia’s international strategy, helping it to exploit its growth potential in international infrastructure business. In addition, the acquisition gives Implenia access to the growing market for tunnelling and infrastructure work in Norway, as well as to further markets in Scandinavia. With its around 260 employees in Norway, Implenia has ambitious goals and is pushing ahead systematically with the internationalisation of its business. Selected projects Implenia is currently working on about 30 infrastructure and tunnelling projects throughout Norway from its five offices. Gevingåsen railway tunnel, Stjørdal The 4.4 km long, recently completed Gevingåsen railway tunnel to the south of Stjørdal is the first stage of the high-speed line between the towns of Steinkjer and Trondheim. Implenia Norge was responsible for most of the tunnelling work, with a contract worth CHF 80 million. * before integration costs and amortisation of intangible assets 1 consolidation from 18.07.2011
62–63
Implenia Norway
Growing investments into Norwegian infrastructure market (in NOK m)
Norwegian National Transport Plan
30,000
25,000
20,567
25,000
22,741
(in NOK m)
15,613
20,000
20,000
8,783
15,000 5,977
10,000 10,000 5,000
2011
2007
2009
2005
2001
2003
1997
1999
1995
1991
1993
0
Jernbanetorget City Square, Oslo
2013*
5,000
Gevingåsen Tunnel, Stjørdal
Roads (incl. brides and tunnels) Energy Railways
Jernbanetorget City Square, Oslo Implenia Norge is responsible for the surfacing work for the CHF 35 million refurbishment of Jernbanetorget City Square, which is right by the station. The square was re-opened after the completion of construction works in April 2009. The recently built Nordenga Bridge in Oslo is another key project. See page 56 for more details. A market with potential Norway’s infrastructure market holds a lot of potential for Implenia. For years Norway has invested significant sums in its infrastructure, and according to estimates by Prognosesenteret AS (an independent market research company specialising in construction in Scandinavia), this level of investment is set to grow further in the years to come. The government “National Transport Plan” alone is scheduled to bring substantial investments in transport infrastructure (rail and road) in the years up to 2019 (see chart page 63).
“Implenia brings additional expertise in tunnel construction to Norway. This will allow us to tender for larger and more complex infrastructure projects in future.” Tormod Stigen, Project Director, Tunnelling
9,501
15,000
0 2006–2009 2010–2013 2014–2019
Road Rail Source: Samferdselsdepartementet, 2012
* Forecast Source: Prognosesenteret AB
“Our vision is to become the leading provider in the infrastructure sector in Scandinavia. We are strengthening our position in the Norwegian market by making targeted use of knowledge transfer between Norway and Switzerland.” Petter A. Vistnes, Head of Implenia Norge / Adm. Dir.
“Implenia is known for quality and for its experienced and competent employees. As Implenia, we will be even more attractive to potential employees here in Norway. We have been able to hire more than 30 highly motivated new employees since August. This fits with our ambitious growth targets.” Bjarne Brendstuen, HR Manager
64–65
Corporate Center
Corporate Center
The Corporate Center provides central services for the entire Group. The main focus in 2011 was on optimising and professionalising existing processes, and on introducing new standards. By establishing such best-in-class methods, the Corporate Center aims to make an active contribution to value creation at Implenia. New salary system makes for fairness and transparency In the year under review the HR Department introduced a new salary system for the Implenia Group. The system, based on an assessment of each position, establishes remuneration criteria that are clear, transparent and in line with standard market practice. Respected consultancy firm HAY helped to develop the system, ensuring that the latest international insights were taken into consideration. In order to strengthen education and training, a new Human Resources Development department was set up within HR. Its initial aim will be to improve management training. Cost accounting system enhanced Last year the Finance and Controlling Department switched to a monthly consolidation process for the entire Group. This means that financial figures will be available more quickly and in greater detail in future. Another key area of activity in the year under review was the preparatory work carried out ahead of the introduction of the value-based management strategy (see interview on page 66 for more information on this). An optimised cost accounting system and the expansion of the existing contribution accounting system are also helping improve cost transparency. Treasury was hived off from the Finance and Controlling Department and now reports directly to the CFO. This reorganisation was carried out in response to additional duties and increasing demands, for example the more complex exchange rate management required as the Group’s international activities expand. Investment Management conducts successful transactions Under the leadership of the Investment Management Department, Implenia successfully placed a number of investment properties with institutional investors during the year under review. An important milestone was achieved by the divestment of rental properties on the Sulzer site in Winterthur: in line with our strategy, three properties were sold. In the public tender process for the contract to manage the Implenia Pension Fund’s real estate portfolio, the Investment Management Department succeeded against a number of external bidders.
Hundredth construction project insured, roll-out of new IT software The Insurance Department insured its one hundredth building project during the year under review as part of the contract for Park Tower in Zug. Thirteen workshops were held throughout Switzerland to give Infrastructure Construction employees comprehensive training on insurance themes. The IT area now reports to the Head of Insurance. The focus here was on the Groupwide roll-out of the latest Microsoft Windows / Office software, the new invitation to tender for the Data Centre, and integration and support work for the international units. Modernised, professionalised Legal Service In 2011 the Legal Service was professionalised and modernised. This included extending competencies to meet international requirements. The department now handles all legal proceedings, actively supports all transactions associated with acquisitions and important tenders, suggests improvements relating to compliance, and helps operational areas with implemen tation. In addition, all of the Group’s regulations were subject to comprehensive legal review. Where necessary, they were updated or augmented. Internet presence overhauled, successful sponsoring concept Implenia overhauled its internet presence to make it even more attractive and user-friendly for clients, business partners, investors and staff. The website was thoroughly restructured and redesigned. In the Bilanz Annual Report Rating league table, the Implenia 2011 Annual Report once again came third in the design category. 2011 was a year dominated by sport for the Marketing and Communication Department: Implenia sponsored a number of high-profile athletics events, including the Weltklasse in Zurich, Athletissima in Lausanne and the Zurich and Geneva marathons. Implenia was helped here by its brand ambassador Ruedi Wild.
“I am pleased that we were able to make further progress on optimising and professionalising our services and processes in 2011.” Beat Fellmann, CFO
66–67
Value-based Management
“With the value-based management approach, all management processes and the entire range of services can be focused on increasing value; and we can measure the results.” Beat Fellmann, CFO
Value creation made clear
Implenia is preparing to introduce “value-based management”, a management model that gears services and activities to the creation of corporate value. When targeted correctly, the model provides managers with a valuable analytical tool. In this interview, CFO Beat Fellmann and Roland Dubach, Head of Finance & Controlling, explain the background. What does Implenia want to achieve with value-based management? Beat Fellmann: Value-based management is a model for measuring the creation of corporate value. It does this at Group level, but also at all the individual operational units: divisions, profit centres and branch offices. All management processes and the entire range of services can be focused on increasing value; and we are able to measure the results. Roland Dubach: To manage the business successfully, our managers need clear financial benchmarks. The new benchmarks provided by value-based management are ideal because they show whether corporate value has increased or not over time and highlight the causes of any change. How is value creation measured? Fellmann: “Economic profit” is the key measure. It shows whether an operational unit is achieving a return on invested capital or at least covering its cost of capital. Only if this is the case are the activities of that unit creating value. And only if a corporation is increasing its value can it expect to see an improvement in the way it is evaluated and perceived. Dubach: The concept is based on the principle that capital does not come free of charge. In other words, just because a unit generates profit, it doesn’t necessarily mean that it’s also creating value. The unit only creates value if it produces enough profit to secure a decent return on the committed capital – i.e. on the funds used by the unit to produce this profit.
Fellmann: Implenia already has a performance evaluation model that goes some way towards this. It’s based on the two key figures EBITDA and invested capital. What’s new is that we’re now combining these two key measures. We apply a notional cost factor to the invested capital and then deduct this cost factor from EBITDA. “Economic profit” is only generated if the return is at least equal to these notional capital costs. In this model, creating corporate value is the overall objective. But how is this turned into operationally realisable performance targets? Fellmann: Economic profit combines three basic value drivers: growth, cost efficiency and capital efficiency. From these three basic value drivers we can derive key performance indicators, or KPIs. These are straightforward targets for operational activities, such as capacity utilisation, labour costs per hour, billing days and payment times. Employees in our various units can use these simple tools to measure and control their value creation. Value-based management is only credible if it’s integrated into management processes. Is this the case at Implenia? Dubach: The operational management team was involved in defining the KPIs. The formulation of measures relevant to each unit was a joint effort. Operational managers now need to show that they can control growth or cost efficiency effectively with these KPIs. This will then be used as part of the assessment of department-specific and individual per formance targets.
68–69
Value-based Management
“For us to grow the value of the company, the financial figures obviously have to be right. But other factors also play their part, like trust in the company, a responsible attitude, and management credibility.” Roland Dubach, Head of Finance & Controlling
Market conditions are also important. When the conditions are right for construction, it is obviously easier to increase corporate value. Does the concept take account of this? Dubach: Market conditions are taken into account by building specially defined KPIs – e.g. tender volumes – into the agreed objectives as target values. This ensures that subsequent comparisons of target and actual performance are based on realistic figures. Fellmann: The three value drivers mentioned earlier – growth, cost efficiency and capital efficiency – allow us to make a differentiated analysis, so the impact of a macroeconomic downturn is shown clearly and transparently.
So in future even management pay will be influenced by the KPIs and the value actually created? Fellmann: Yes, that’s what will happen in future, once the system has been properly introduced and bedded in. A remuneration system only helps to achieve goals if it is understood and accepted. The aim is to incorporate elements of value-based management into the key targets agreed for the 2013 financial year. Isn’t there a risk that short-termism will gain the upper hand at Implenia? Fellmann: No, exactly the opposite will happen, because the concept is not geared to short-term factors. The assessment is not based on a snapshot of one particular point in time, but on performance over a longer period. Dubach: For us to grow the value of the company, the financial figures obviously have to be right, but other factors also play their part, like trust in the company, a responsible attitude, and management credibility. The value of the company can only increase if these factors are positive over the longer term. Fellmann: Value-based management harmonises the interests of all the company’s stakeholders – shareholders, investors, employees, customers and suppliers – because its overriding goal is long-term, sustainable growth.
When will the new model take effect? Fellmann: It will come into force in 2013. We are deliberately taking time to bed the new system in properly and allow everyone involved to familiarise themselves with it. In practical terms, what exactly will be different for Implenia managers and staff? Fellmann: We haven’t reinvented the wheel. Performance will continue to be measured with the key figures used by Implenia since 2008: EBITDA and invested capital. A number of new key figures will be added to the existing ones, making it easier for employees to identify ways to make a direct contribution to Implenia’s added value. Dubach: And conversely, of course, it will be easier to see where a unit’s value contribution leaves something to be desired. We will be able to analyse problems faster and in greater detail. So in the future we will be able to solve those problems more quickly, more accurately and in a more targeted manner. Will the shareholders and the general public be informed of value creation targets and whether they have been met? Fellmann: Of course. Implenia has long stressed the importance of transparency. That will not change under the new model. Interview: Thomas Balmer
Density creates variety Switzerland’s population has risen by 700,000 since the start of the millennium and is continuing to grow every year by a number equivalent to the population of the city of Lucerne. The supply of homes and work spaces has struggled to keep up with this growth, especially in urban centres. As a consequence, many people are moving out to lower-cost areas outside the cities and towns. According to estimates, the population could go up by another 1.5 million by 2030. Which raises the question of what kind of building is needed for the future. People in Switzerland will have to get closer to each other. The use of land for homes is one of the great challenges facing a small country and the idea of urban densification is gaining wide support. But the complexities of high-density construction often only become apparent when the idea is put into practice. Difficult questions are raised about the standard of residential developments, quality of life, transport capacities, aesthetics and social acceptability. Costs also play a role. “The more densely you build, the more expensive it is,” says Christian Faber, the SBB’s overall project manager for the Europa allee development (see also feature in the following fold-out).
Suburbs reaching their limits Rural regions in particular have been trying for years to persuade people to move there, with generous zoning laws and cheap land. Fewer planning restrictions and subsidised public transport are further attractions. Living in the suburbs and in the country is “in”: between 1970 and 2000 the number of commuters in Switzerland increased by 41 percent according to a study of housing trends by think tank Avenir Suisse. If population growth forecasts by the Federal Statistics Office are correct, the suburbs will soon be reaching their limits. For Vittorio Magnago Lampugnani, Professor for the History of Urban Design at the Swiss Federal
Land prices in the city of Zurich In 2009 the price of undeveloped land in Zurich’s residential and mixed zones reached a new record price of CHF 2,121 per square meter (price based on actual transactions).
2009 2004 1999 1994 1989 1984 1979 1974 0
500
1000
1500
2000
2500
Source: Canton Zurich Office of Statistics.
Institute of Technology in Zurich, the current lack of town centre housing and growi ng urban sprawl mean that there is no longer any way of getting round the need for high-density construction, “because it is desirable functionally, economically, environmentally, socially and culturally.”
“There is no longer any way round highdensity construction.” Vittorio Magnago Lampugnani, Architect and Professor for the History of Urban Design at the Swiss Federal Institute of Technology, Zurich
In praise of cities Lampugnani makes a key point: “In the 19th century, high urban density was a synonym for people living unhygenically on top of one another.” But highdensity housing in cities these days can provide people with adequate and affordable living space, combined with the variety, wealth of opportunities and efficiency that city living can bring. “Cities should be what they always used to be: places of diversity, variety and surprise,” Lampugnani says. With new approaches to high-density living and working, as exemplified by the new Europaallee development being built in Zurich, this vision can become a reality.
Europaallee Zurich – building a new neighbourhood The first of eight stages of construction for Europaallee, Zurich’s new neighbourhood, is close to completion. In the heart of the city and right by the main station, a development is being built that brings together homes, workplaces and educational institutes in a surprisingly small area. In just two and a half years, Implenia, working as total contractor for Swiss Federal Railways (SBB, plot A) and UBS (plot C), has built properties offering 100,000 square metres of usable space. The first tenants are due to move in this autumn. Work on Plot E, commissioned in 2011, has begun. We make an on-site inspection.
It is a cold January day at the Europa allee development next to Zurich’s main station. The recreation area of the Zurich University of Teacher Education lies at the heart of Construction Plot A. From here you can look up at the facades, up to 40 metres high, of the three university blocks and the office building hired by Credit Suisse. The white limestone and large windows give the massive university buildings a more delicate look. Plot A was designed by Swiss architect Max Dudler, a fan of clean lines. The tenants – 2500 students, lecturers and support staff – are due to move into the new 40,000 square metre premises this autumn. A few nice extras await them: a shopping centre on the ground floor, a multipurpose gym on the top floors, and fantastic panoramic views of the city and mountains.
Complex logistics Plot C, home to the impressive UBS office block, lies behind Plot A. Implenia is total contractor for Plots A, C and E, with a contract worth CHF 500 million. Despite the complex logistics, construction of the buildings on Plots A and C, up to eleven storeys high, which the Infrastructure Construction Division also worked on, has only taken two years. For buildings offering a total of around 95,000 square metres of rental space, this is extremely fast (see interview with department head Adrian Wyss below). Implenia was recently also chosen to work on the third plot (Plot E). This will involve another office block, topped by two residential towers.
1 Europaplatz 2 Sihlquai-Passage 3 Gustav-Gull-Platz 4 Lagerstrasse 5 Europaallee 6 Zurich University of Teacher Education 7 Footbridge 8 Negrelli footbridge 9 Kasernenstrasse
The city and the architects Europaallee is taking shape in collaboration with the City of Zurich. Quality standards are high, and visually the development has to fit in with the surrounding area. All of the buildings are large blocks. A variety of uses and highquality architecture are essential. The client Swiss Federal Railways (SBB) is – with the exception of Plot C – the sole client and project developer for Europaallee, which is estimated to be costing a total of CHF 1.5 billion. Around 52 percent of the 270,000 square metres of usable space will be taken up by offices, while 20 percent will be for apartments / retirement home / hotel, 10 percent for retail and 18 percent for education. Plots A and have a solid list of tenants – the Canton of Zurich as the sponsor of the University, along with Credit Suisse and asset manager Swisscanto, which
Adrian Wyss, Implenia’s Department Head for Europaallee
belongs to the country’s 24 cantonal banks. The first of the 400 apartments located on plots E, F, G and H will be ready by 2014 at the earliest. Europaallee will be completed in 2020. At that point, approximately 9,000 workers, students and residents will be here every day, along with many additional passers-by and hotel guests. With a total site area of 78,000 square metres and above-ground usable space totalling 270,000 square metres, Europaallee is an impressive example of modern, sustainable, high-density urban living. The SBB are specialists in high-density construction near railway stations, and with Europaallee they are for the first time building a development the size of a whole neighbourhood.
How important is Europaallee for Implenia? Adrian Wyss: It is our biggest building construction project in Zurich. Plots A and C were a big challenge mainly because of the short construction timetable of around two and a half years. It was a high-performance effort by the builders on site too.
Under construction
How was the work done? Usage of Plots A1-A3, C and E built by Implenia as total contractor
8
2016 Plot
H
2018 Plot
2015 Plot
2020 Plot
2017 Plot
D
B
F
G 3
2014 Plot
E
5
2013 Plot
C
2012 Plot
Europaallee phases
2
1
Completion
Owners
Total rental m2
Usage
Tenants
Incl. PHZH, Transa, Ochsner, Coop Credit Suisse
Plot A20 Plot A30
2012 2012
SBB SBB
40,000 12,000
Education, shopping Offices, shopping
Plot C
2013
UBS
32,000
Offices
UBS
Plot E
2014
SBB
11,000
Offices, homes
Swisscanto
7
A 6
≤≤ Right in the heart of the city of Zurich, not far from the main station between the Sihlpost building and Langstrasse, a new 78,000 m2 urban living space is being created. As total contractor Implenia is responsible for building Plots A, C and E.
9 4
Source: www.Europaallee.ch
Architects
Max Dudler Max Dudler Max Dudler, Gigon & Guyer, David Chipperfield Caruso St. John, Bosshard Vaquer
Wyss: Europaallee is a very large and complex project. It presented us with particular challenges as a total contractor. On Plot A we used up to 100 subcontractors, and on plot C between 60 and 70. In total there were four or five hundred workers on site. Most of the subcontractors were Swiss, and many were from the Zurich region. Quality and aesthetic appeal were the chief criteria for materials and technical installations. Shell limestone was used for the University facade and black cherry for the interior panelling.
What makes Europaallee special? Wyss: The special factors are the mixed usage and the visual diversity. You see this most clearly on the UBS building, which was designed by three architects. The building has a rich and varied facade. Two buildings were designed by Max Dudler, one by David Chipperfield and one by Gigon Guyer. And we are, of course, particularly pleased that we have been able to help build a whole new neighbourhood for Zurich.
82–83
Vision, values and positioning
Implenia develops and builds the Switzerland of tomorrow
Implenia is Switzerland’s leading construction and construction services company. With its comprehensive portfolio of services and products covering the whole construction value chain, Implenia is a full-service provider, offering everything required to complete a project – sustainably and from a single source. The company’s success is built on a compelling vision, a set of values shared by all of its employees and a clear positioning. Formed in 2006 from the merger between Zschokke and Batigroup, Implenia can look back on more than 140 years of history in the construction industry. The Group is the market leader in Switzerland and its aim is to help shape the Switzerland of tomorrow – in a spirit of sustainability, and to the benefit of society as a whole. Implenia develops and builds new things and renovates old ones; it builds for living, for education, for working, for transport, for leisure, sport and health; it builds traditionally or industrially, as a total contractor or as a specialist. Implenia is passionate about developing and building. A motivating vision Our vision encapsulates our long-term ambitions as a leading national construction and construction services company that also operates on the international stage:
Our vision We develop and build the Switzerland of tomorrow. We establish ourselves as an expert for complex international infrastructure projects. Sustainability is our passion. We are the partner of choice for customers and employees alike.
“We are developing and building the Switzerland of tomorrow” underlines the importance to Implenia of its home market. Thanks to its size, Implenia is at the forefront of many of the most significant projects in Switzerland. Its commitment to Switzerland is reflected in the 100 or so offices it maintains around the country. Internationally, Implenia is positioned as an expert in demanding infrastructure projects. Sustainability is an integral component of the company’s strategy, systematically influencing all its decisions. With its claim “We are the partner of choice for customers and employees,” Implenia is emphasising that we can only be successful if we are attractive to our customers and employees. Built on shared values Implenia’s vision and the strategic priorities that go with it can only come to fruition if all employees are able to build from a set of shared values. Implenia has formulated principles that form the foundations of its corporate culture and that everyone in the Group is expected to live up to, actively and consistently:
Reliability Sustainability Integrity Opportunity and risk awareness Transparency Operational and financial excellence Focus on solutions and customers Innovation
You can count on us. Out of respect for our environment and ourselves. It lies at the heart of everything we do. As a business we want to recognise opportunities and risks early. Towards our stakeholders. A measurable requirement for all of our activities. Solutions for our customers are our priority. Our future depends on our ability to keep renewing ourselves and moving forward.
84–85
Vision, values and positioning
A clear vision and a set of values that are shared by all employees provide the foundations of Implenia’s corporate culture.
Positioning as full service provider Its experience, size and financial strength also allow Implenia to offer its services beyond Switzerland on the international market. Within the Group, Implenia brings together the expertise of three divisions: Real Estate, Infrastructure Construction and Industrial Construction. In Switzerland, the entire Group’s capabilities and capacities are available for challenging real estate and infrastructure projects. Internationally, Implenia positions itself as the partner of choice for demanding infrastructure projects. Divisions and services Real Estate
Infrastructure Construction
Industrial Construction
General and Total Contracting Development Engineering Technical Facilities Management
Building Construction (New and Conversions) Road Construction and Civil Works Civil Engineering Foundation Engineering Bridge Construction Concrete Repairs Gravel and Surfacing Work
Tunnelling (Switzerland and International)
Underground Construction Power Station Construction Railway Infrastructure Microtunnelling Prime Buildings (International)
Consulting and project and construction management for challenging real estate projects
Real Estate The Real Estate Division includes the Project Development Unit, which provides a compre hensive range of services covering the entire lifecycle of a property from planning and construction to operational optimisation, plus the General Contracting Unit. The Division also includes Reuss Engineering, which specialises in sustainability consultancy and building technology. Infrastructure Construction The Infrastructure Construction Division offers all the production activities required for road building, civil works, building construction, infrastructure projects, civil engineering, underground construction and foundation engineering. As the market leader in Switzerland, Implenia Infrastructure Construction offers wide experience, a large portfolio of reference projects and the best technical equipment. Industrial Construction The Industrial Construction Division specialises in challenging infrastructure projects in and outside Switzerland. The Tunnelling unit concentrates mainly on tunnel building for transport tunnels, hydroelectric plants, sewage systems etc. The Prime Buildings unit works internationally primarily in consultancy and on project and construction management for major prime building projects.
Strategy and business model
Sustainability and integrated business model as success factors
Its commitment to sustainability and the integrated business model are two of Implenia’s central success factors. Sustainability is the guiding principle for our business activity. It ensures that Implenia prioritises the creation of enterprise value in harmony with the economy, the environment and society. Based on its integrated business model, Implenia offers all services along the whole construction value chain from a single source. Implenia’s aim is to build further – sustainably and over the long term – on its position as a leading national construction and construction services company that also operates on the international stage. With this in mind, the company pursues a series of strategic priorities: Sustainability as the basis of corporate strategy Out of a conviction that seizing opportunities and identifying risks early on – taking account of economic, environmental and social criteria – is crucial to the company’s success and ability to thrive in the future, Implenia focuses its corporate strategy and its whole way of doing business on the principles of sustainability. Implenia believes that if it takes opportunities and manages risks in this way, the company will further improve its competitive position and generate corporate value for all its stakeholders.
86–87
Integrated business model increases customer benefits: “One company, one goal, one spirit” Cross-disciplinary cooperation between Real Estate, Infrastructure Construction, Industrial Construction and the Corporate Center means that all the Group’s available expertise is bundled together, synergies are exploited to the benefit of customers, and Implenia can perform successfully as a total service provider. Higher earnings thanks to stronger project development business Implenia can take a construction project though its entire lifecycle – from the initial idea, through planning and organisation, to actual construction work. The company is systematically building up capacity in upstream project development activities with a view to realising its corporate vision (“We are developing and building the Switzerland of tomorrow”). Growth through selective, risk-appropriate development and expansion of international business Implenia positions itself outside Switzerland as an expert partner for complex infrastructure and prime buildings projects. The company limits its risk in international business by focusing on its existing competencies in project management, stadium building, tunnelling, civil engineering and microtunnelling. Increasing efficiency by steadily industrialising processes Implenia exploits the synergies produced by bringing together central functions in the Corporate Center. These include: Procurement, Finance & Controlling, Human Resources, IT, Investment Management, Marketing & Communication, Legal Services and Insurance. In addition, processes in all divisions – from client acquisition through project planning and execution to logistics – are constantly reviewed and optimised.
88–89
Strategy and business model
Cross-divisional cooperation – integrated business model Idea / concept
Financing
Project development
Planning / engineering
Execution
Management
Renovation / conversion / removal
Investment Management Development Engineering General Contracting Construction Industrial Construction*
* Tunnelling and Prime Buildings
The integrated business model – i.e. cross-divisional cooperation between Real Estate, Infrastructure Construction, Industrial Construction and the Corporate Center – bundles together all the expertise available in the Group. This means that integrated solutions covering the whole lifecycle of a construction project can be developed in response to complex, interdisciplinary ventures. The knowledge available within the Group is not just added together, but multiplied.
New system for better risk management Active risk management is essential for Implenia if it is to sustainably increase its earnings power. For years now Implenia has led the way with its process management systems, internal auditing, regular reporting and transparent information culture. In order to maintain its role as a pioneer, the company is currently developing a management information system based on state-of-the-art IT tools. This will make it easier at all levels of management to control opportunities and risks more transparently, effectively and quickly across all processes, from acquisition to completion. Active brand management for a strong image Implenia has a strong brand, which is very visible and very well-known in the Swiss market. In its external and internal communication the company follows a one-brand strategy based on the principle of “One Company, One Goal, One Spirit”. The aim is for the company to be seen from the outside too as a single entity. A comprehensive manual contains all the rules for using the brands in different applications, including business documents, signage at construction sites and communications of all types (advertisements, give-aways, vehicle livery etc.). There is a continuous quality assurance system in place for signage at construction sites; because these signs provide the brand with such wide exposure and high visibility, they are regularly reviewed to ensure compliance with the branding rules. These rules are also applied rigorously to the website and any new brochure concepts. At the same time, if the application has specific special characteristics, these are also taken into account. During the year under review, a lot of work was done on the integration of Betonmast Anlegg, the company acquired in Norway, into Implenia’s brand structure. The Norwegian tunnelling specialist now operates in the Norwegian market under the name “Implenia Norge” using Implenia’s brand design. Betonmast’s entire corporate design has been changed over to Implenia’s. The alterations that had to be made in all areas (construction site signage, stationery, job adverts) have now been completed.
90–91
Employees
Safety at work
Measures to keep employees safe The construction trades involve a lot of hard physical work, and there are many potential risks to be found in workshops and on construction sites. One of the responsibilities that Implenia has for its employees is to ensure they are protected from occupational accidents and health risks. The company takes comprehensive measures in this area, and carries out awareness and information campaigns on health and safety at work. See page 96 for further information.
The people at Implenia
More than 6000* people from more than 60 nations work for Implenia around the world. Their abilities and commitment ensure the company’s continuing success, so Implenia is keen to offer its employees an attractive working environment. Factors such as training and development, job security, social benefits and internal communication play a central role here. In Switzerland and border regions of neighbouring countries, Implenia’s workforce at the end of 2011 was practically the same size as a year before with 5162 full time posts (compared with 5151 in 2010, up 0.2%). Personnel fluctuations came to 12.7% (excluding seasonal fluctuations), which is 1.2 percentage points lower than the previous year (2010: 11.5%). The Real Estate Division increased its headcount in line with strategy (+3.9%) in order to cope with the expansion of its Project Development business during the last financial year. Headcount at the Infrastructure Construction Division also rose slightly (+1.2%). The number of employees in the Industrial Construction Division in Switzerland was 9.2% lower than a year previously because of NEAT tunnel construction contracts coming to an end. Of the workforce in Switzerland and border regions of neighbouring countries, 4745 are men and 417 women. This means the percentage of women, at 8.1%, was around the same as in the previous year (2010: 8.0%).
Headcount (FTE) 2011 Office and on-site staff
Headcount (FTE) 2010 Number of employees
Office and on-site staff
Number of employees
Real Estate Infrastructure Construction Industrial Construction Other
482 3 912 573 195
Real Estate Infrastructure Construction Industrial Construction Other
464 3 867 631 189
Total employees (FTE, Switzerland and neighbouring countries)
5 162
Total employees (FTE, Switzerland and neighbouring countries)
5 151
Implenia Norge Other countries (FTE) Total employees (FTE)
260 226 5 648
Implenia Norge Other countries (FTE) Total employees (FTE)
– 273 5 424
* equivalent to 5648 (FTE)
92–93
Employees
5162
5151
5115
5192
6000
5212
Employees (full-time equivalents)*
417
414
351
359
358
5000
4000
3000
2000
Higher priority for training and development True to its vision, Implenia wants to be the Partner of Choice not only for customers, but also for employees. To this end, the Group fosters a modern management culture that places trust in employees’ willingness to work and take responsibility, and that delegates decisionmaking authority down to the lowest possible level. To ensure that the knowledge required to make this culture of trust work is present at all levels of the Group, Implenia continues to improve and expand its programme of training and development. Its employee development concept is based on the corporate strategy and takes account of the needs of both employee and company. Individually tailored development plans ensure that employees have the necessary professional and personal skills. There are always shortages of well-qualified specialists on the labour market, so Implenia aims to fill its specialist and management posts increasingly from within the Group. Employees are offered career opportunities across the divisions and in other countries. Implenia runs a modular training and development programme for its employees. Different training modules are available to suit each employee’s particular area of work. Implenia also supports employees taking individual training courses outside the company. Further modules were added to the training and development programme in 2011. These included the innovative new career programme for construction cost planning based round the “CAS Baukostenplanung GU / TU” (“Certificate of Advanced Studies in Construction Cost Planning for General and Total Contracting”) training course at the University of Lucerne (see fold-out focus employer). Implenia will continue to expand the range of courses, particularly in the fields of professional skills and personal development.
4833
4764
4737
4745
2008
2009
2010
2011
Implenia has a worldwide total of 5648 full-time posts, a rise of 4.1% on 2010 (5424). The acquisition of Norwegian company Betonmast Anlegg added another 260 full-time posts to the total (as at 31.12.2011). In the other international markets (Russia, the Middle East, Ivory Coast), headcount fell (–17.2%). Worldwide, Implenia currently employs people from more than 60 different countries.
4854
0
2007
1000
Number of women (full-time equivalents) Number of men (full-time equivalents) * Switzerland and neighbouring countries
Apprenticeships and management development are vital People often join Implenia as apprentices, so good, solid training for these apprentices is crucial. Implenia is currently taking care of 215 apprentices: 25 in technical / commercial roles and 190 in on-site roles. These 190 are being trained in various professions, including as construction machine mechanics, builders, foundation engineers, heating engineers, ventilation engineers, plumbing engineers, masons, mechanics, carpenters, road builders, railway builders and joiners. The company coordinates the responsibilities taken by the apprentices’ managers, HR and the trainers, ensuring that apprentices are supported throughout their whole course. The aim is to identify good new talent early on and, depending on how mobile they are, give them the most suitable placements in Switzerland. Most apprentices will be given a job at the company after they have finished their course. By training its own young talent, Implenia is not only investing in its future, but is performing an important task for society as a whole (see “apprentices talk to the CEO” on page 30). Implenia is also actively involved at the university level. For example, the company supports the ETH Zurich’s Excellence Scholarship Programme, providing scholarships for three students a year on the construction engineering course (see interview on page 112 – 115).
94–95
EmployEEs
non-occupational accidents*
300
300
implenia is one of the most attractive employees The Universum Top 50 Ideal Employer Student Survey ® shows which companies are the most popular choice for Swiss university graduates. In 2011 the annual survey showed Implenia placing high again in 13 th position, up six places from 2010, making it one of the most sought-after companies in the engineering sector.
29 19
135 107
99
127 109
78
83
104
83
71
76
Management Real Estate Infrastructure Construction Industrial Construction
Management Real Estate Infrastructure Construction Industrial Construction
* Switzerland and neighbouring countries
* Switzerland and neighbouring countries
2011
2010
2009
2008
2007
2011
0 2010
2009
0
19
31 5
27 0
23 0
0
146 145
50
118
50
99
100
113
100
110
150
143 159
200 135
244 170
223 167
170
176
177
250
150
2008
social policy – implenia wins the “prix santé au travail” Alongside its extensive measures to ensure health and safety at work, as part of Implenia’s social policy, the company has teamed up with external specialists from the PMSE health promotion agency to establish a contact point for employees who would like to talk to trained experts about health, social, family or financial issues. Implenia’s employee program to help prevent alcohol abuse was recognised at the end of January 2012 by the award of the “Santé au travail” prize by the AEPS (Association Européenne pour la Promotion de la Santé). Implenia is also very involved in looking after employees who suffer accidents or illness, and helping them get back to work; it collaborates with case management specialists who provide intensive care on the road to rehabilitation. Another key element of Implenia’s social policy is its respect for the principle for equal rights and equal treatment for all employees. Wage equality plays an important role here. During the period under review, Implenia replaced the wage system that had developed over many years with a modern salary system. This is based on job evaluations that facilitate specialist and management career models. The salary system ensures that people are paid in line with market standards and in accordance with fair, transparent and comprehensible criteria. Implenia’s hiring regulations fulfil modern standards, and its working hours and holiday regulations allow employees to maintain a good work-life balance.
200
2007
code of conduct sets out the rules Implenia’s corporate rules and standards of behaviour are set out in the Code of Conduct. The Code defines how to behave with colleagues, suppliers, customers and the authorities. It has three main areas of focus. “General rules of behaviour” covers the following themes: social responsibility; environment, health and safety; integrity and law-abiding conduct; data protection; use of data processing resources, confidentiality and conflicts of interest; drugs and alcohol. The second area of focus deals with corrupt practices, and the third with adherence to anti-trust laws. There was intensive training on the Code of Conduct when it was introduced, and all employees must sign a declaration that they will comply with it. During the year under review, all managers were required to give their teams fresh training in the Code.
218
250
238
276
occupational accidents*
the importance of internal communication: dialogue with employees Implenia believes in the value of open and direct communication. Good communication encourages employees to identify with the corporate objectives and ensures that they understand and support the decisions the company makes. All of Implenia’s managers are trained to nurture dialogue actively with their staff. The company also uses various internal communications tools and channels, which it deploys selectively to suit the specific communication goal. These include the employee magazine “Impact”, the intranet, regular staff events and an electronic newsletter.
96–97
Employees
Promoting a safe and healthy work environment Within the Infrastructure Construction Division, which has the most employees and the most workplace risks, various programmes certified under OHSAS 18001, ISO 14001 and 9001 ensure effective measures are in place. Infrastructure Construction trains all new employees in workplace health and safety when they first join Implenia, tailoring the training to the specific job. Temporary employees hired through agencies also have to go through initial training. In addition, managers on the construction site are responsible for informing temporary staff about the particular dangers and the emergency procedures used on site. Every month, foremen and site managers use short training sessions to inform site personnel of the latest issues. Sometimes the training is created centrally and then implemented in the relevant languages. In some months, topics can be chosen that are specific to the profit centre’s main activity. Occupational accidents rise, non-occupational accidents fall Implenia measures occupational and non-occupational accidents in terms of the number of incidents per 1000 full-time posts, and in days lost. After declining between 2007 and 2008, the five-year trend for accidents at work was almost flat in subsequent years. Unfortunately 2011 saw a slight rise to 159 occupational accidents per 1000 full-time jobs, compared with 154 in the previous year. The Implenia employees who are most exposed to the risk of accident are on-site workers in the Infrastructure Construction and Industrial Construction Divisions. The fact that the number of days lost per incident increased from 28.9 to 31.3 reflects the more serious nature of the accidents. There was a further reduction in non-occupational accidents from 108 to 100 incidents per 1000 full-time posts. Most incidents fall into the category of “slips and falls”. 32% of accidents recorded in 2011 were caused by slips or falls. There was a slight reduction of 2% in this type of accident. Occupational accidents involving machinery or electrical equipment are rare (about 3% of all incidents), but with an average of 46.6 calendar days lost, these are the most serious type of accident.
needs to be systematically integrated into each individual operating procedure. Employees in Implenia’s offices throughout the Group are taught about “Ergonomy in the workplace”. The pilot project aims to find out how feasible regular on-site training is, and what effect it has. Numerous training modules Alongside these specific health and safety campaigns, training takes place at regular intervals each year in each division as set out in the Integrated Management System (IMS). These training sessions are carried out decentrally in the individual regions. They cover modules that include a safety induction for new employees, a two-day management seminar with Suva for all new foremen, site managers and technical managers, a safety and accident-prevention course for site personnel, and an emergency response and first aid course. The status of health and safety measures is audited once a year by an external agency. The last audits were carried out in November 2011. Implenia will be augmenting the existing modules with further activities in 2012. As part of the “Safety Charter”, a campaign run jointly by employer and employee organisations and backed by Suva, Implenia is committed to strict compliance with safety rules in its area of responsibility. The aim is to protect the lives and physical wellbeing of everyone involved in construction. “Turboschlaf” is a campaign initiated by the Beratungsstelle für Unfallverhütung (bfu) to highlight the dangers of falling asleep while driving. Implenia employees cover many kilometres a day by car or by site bus, which is why the company decided to take part in the campaign. Implenia has also teamed up with Suva on the “Handlauf” (“handrail”) campaign, because according to Suva, around 30% of all slips, trips and falls occur on the stairs.
Fit bei der Arbeit (“Fit for Work”)
Constant optimisation Despite all the measures taken to date on health and safety, the trend in accident figures and Suva’s industry survey show that there is still room for improvement. Each accident is one too many. Implenia invests continuously in measures to improve health and safety and in training its employees. In 2011, several courses were run for site personnel and technical managers, including “Responsibility on the building site” and “Vital rules on the building site”. These courses are designed to embed the principles of health and safety so that they are always applied when construction sites are planned and become a natural part of employees’ day-to-day behaviour. The aim is to view occupational health and safety not as an isolated theme, but as an automatic element of project planning that
The most frequent causes of accidents at work are slipping, tripping and falling. At Implenia Infrastructure Construction, for example, these things account for an average of 32% of all accidents. Such incidents often have serious consequences, though they can easily be prevented. This fact prompted Implenia to sign up in 2010 to a multi-year Suva campaign called “stolpern.ch” (“stolpern” means trip or stumble in German). As part of this campaign, it launched the “Fit bei der Arbeit” pilot project on selected sites at the start of this year. There are two aims: to make employees aware of the risk of accidents on stairs; and to reduce the risk of stumbling by improving balance through a simple training programme. The pilot project runs from January to June 2012 with academic support from the University of Basel’s Institute for Sport and Sport Science.
98–99
Sustainability
Sustainability in practice
Solar energy from portacabins A new office building is currently being constructed in Lausanne-Vennes for the CSS health insurance company. Once completed in 2012, it will provide office space for 450 employees. Implenia was brought in to execute the project as general contractor. By fitting portacabins with photovoltaic cells, Implenia is using renewable energy even during the construction phase of a building. This system, used for the first time in Switzerland, produces electricity for use on site, with surpluses being fed into the local grid. The solar panels are helping to reduce energy use and CO2 emissions on the building site even further (see page 103 for further information).
Sustainability promoted in all divisions
Implenia’s declared aim is to create sustainable value by com bining financial success with social and environmental responsibility. Its “Sustainable Implenia” initiative provides a framework for its sustainable development activities. It defines five strategic focuses and ten priority projects that are designed to concentrate all parts of the Group on sustainability. Implenia has done the groundwork that will allow it to publish its first Sustainability Report in 2012. Implenia believes that a sustainable approach is a central prerequisite for long-term success. Consequently the Group wants to be one of the pioneers in its industry for sustain ability. It aims to take account of its various stakeholders’ concerns in a systematic and balanced manner. From strategic priorities to concrete initiatives Implenia has defined five strategic focuses that sit at the heart of the company’s sustainability policy and represent the interests of its stakeholders (see chart). Implenia has defined concrete targets and measures for each focus. The company is thus in a position to develop its processes and organisation in the direction of sustainability, as well as to measure the progress it makes.
100–101
Sustainability
Implenia aims to act sustainably with respect to all its stakeholders
Employees – Involving, collaborating, developing – Limited availability
Society – Acting responsibly – Call for transparency
Customers – Cost-efficient solutions and products – Increasing trend towards sustainable consumer preferences
Environment – Preserving the environment – Our supplier of limited raw materials
Management – Securing a viable future – Implementing vision / strategy
Shareholders – Short-term performance – Growing importance of sustainable investments
Sustainable products and services
– Customer relations – Products and services – Innovation – Supplier relations
Attractive working environment
– Training and development – Talent management – Health and safety at work
Respect for the environment
– Energy and resource efficiency
Social commitment and compliance
– Code of Conduct – Stakeholder dialogue – Communication – Support and sponsorship
Financial excellence
– Sustainable improvement in results
Creation of Board of Directors’ Sustainability Committee To ensure that sustainability is anchored firmly at the highest level of management, the Board of Directors created a Board Sustainability Committee in June 2011. The Sustainability Committee’s job is to assess Implenia strategic options from the point of view of sustainable development. The focus is on core business in all areas of activity, including building construction, roads and civil works, civil engineering, foundation engineering and underground construction. The Sustainability Committee is also responsible for overall monitoring of the company’s sustainability initiatives. Implenia qualifies as a sustainable investment The Kempen SRI Universe Standard (Socially Responsible Investment) is awarded by the Dutch bank Kempen & Co. to European companies that go beyond the legal requirements to make a positive contribution to the environment, society and their employees. In 2011 Kempen assessed Implenia for the first time with regard to the relevant compliance, corporate social responsibility, personnel development and environmental protection criteria. Implenia was given the accreditation straight away, thus joining the list of companies that the bank, which manages numerous sustainability funds, will consider for investment.
Implenia to publish its first Sustainability Report in 2012 The Implenia Sustainability Report, which will appear for the first time this autumn, will contain extensive information about the company’s sustainability performance. It will be based on the internationally respected standard laid down by the Global Reporting Initiative (GRI) and will focus on the five strategic elements defined by Implenia. During the year under review the groundwork was done and the data established for the report, which provides a systematic overview of Implenia’s commitment to sustainability.
102–103
Sustainability
In Basel’s Hirzbrunnen district, Implenia is building the “schorenstadt” housing estate – a beacon project for the 2000-Watt Society that follows the new SIA Energy Efficiency Path.
Sustainability highlights 2011
Embedded in the overall sustainability strategy, Implenia’s commitment can be seen in the wide variety of initiatives and efforts undertaken in 2011. Implenia is taking part in the Federal Office of Energy’s project “Standard Nachhaltiges Bauen Schweiz”, which aims to promote a shared perspective on sustainable construction. Standardised, broad-based and stable evaluation criteria are required if a building’s focus on sustainability is to be reflected in its value too.
Reduction in CO2 emissions
As beacon projects for environmentally friendly construction, Implenia has chosen two projects from its development portfolio for implementation of the 2000-Watt Society concept: the “Werk 1” residential, commercial and hotel development in Winterthur, and the “schorenstadt” residential development in Basel.
Implenia has launched a pilot project on the CSS construction site in Lausanne, installing solar panels on the roofs of the four on-site office portacabins. They cover a total area of 48 m2, and can produce a total of more than 6140 kilowatt hours (kWh) per year. The electricity generated is being used not only to power the site; surpluses are being fed into the local electricity grid. This is reducing CO2 emissions from the building site by five tonnes a year.
In 2011, Implenia laid the foundations for its value-oriented management concept. This management model focuses the company’s processes on the creation of corporate value. Read the interview on this subject on page 66. Implenia ran a number of awareness-raising programmes and training courses on the subject of health and safety at work in 2011. For more information, see the “Employees” chapter, page 96. As part of its commitment to training and development, Implenia worked with Lucerne University to develop a course in construction cost planning. See fold-out focus employer for more information.
Electricity price at market level Once the Lausanne-Vennes project is finished, the solar panels and cabins will be moved to the next construction site. The solar panels have an approximate lifespan of around 20 – 25 years. The four cabins will produce a total of approximately 150,000 kWh of electricity over their whole operational lives. This is enough to provide power for 30 average private homes for a year. Based on the expected lifetime of the panels, the electricity generated costs CHF 0.24 per kWh. This is close to the current market price and much lower than usual for solar power. Depending on how the pilot project goes, Implenia plans to equip more construction sites with solar cells in future.
104–105
Information for investors
Distribution of share capital by type of shareholder (shares with and without voting rights)
Information for investors
Distribution of share capital by size of shareholder (shares with and without voting rights)
Implenia shares have been traded on the main segment of the SIX Swiss Exchange in Zurich since 6 March 2006.
89
19
559 30.26%
984
34.83%
Key information Abbreviation Security number ISIN code
IMPN 2.386.855 CH0023868554 5.40% 9.67%
1.78%
2162
Share capital
Share capital (in CHF 1,000) Number of registered shares issued Of which treasury shares Number of outstanding registered shares Par value of each registered share (in CHF) Conditional capital (in CHF 1,000)
31.12.2011
31.12.2010
31.12.2009
31.12.2008
31.12.2007
35,097
51,721
64,652
73,888
83,124
18,472,000 179,006
18,472,000 211,017
18,472,000 1,526,184
18,472,000 163,943
18,472,000 52,563
18,292,994
18,260,983
16,945,816
18,308,057
18,419,437
1.90
2.80
3.50
4.00
4.50
17,548
25,861
32,326
36,944
41,562
31.12.2011
31.12.2010
31.12.2009
31.12.2008
31.12.2007
3.31 8.1
2.88 10.1
2.56 10.7
2.13 14.9
1.37 26.0
29.1 1.10 4.7% 33.1%
26.8 0.90 2.8% 31.7%
24.8 0.70 2.4% 27.5%
22.8 0.50 1.7% 23.1%
21.7 0.50 1.4% 36.2%
Legal entities Pension funds Investment funds / foundations Banks / insurance companies Private individuals
984 shareholders with 1 –100 shares 2162 shareholders with 101 –1,000 shares 559 shareholders with 1,001 –10,000 shares 89 shareholders with 10,001 –100,000 shares 19 shareholders with 100,000 shares
Key figures
Earnings per share (in CHF) Price-earnings ratio Equity per share (in CHF) Gross dividend 1 (in CHF) Dividend yield 2 Distribution ratio
1 From 2006 – 2011 the distribution took the form of a reduction in par value 2 Excluding tax effect
Distribution policy The aim is to distribute around a third of Group profit as dividends, though care is also taken to ensure dividends are as stable as possible.
Shareholder structure Shareholders owning more than 3% of share capital (as at 31 December 2011) Name
Parmino Holding AG / Max Rössler Group Rudolf Maag Ammann Group Cazenove Capital Management Ltd. Chase Nominees Ltd. Ernst Göhner Stiftung (via EGS Beteiligungen AG)
Number of shares
Percentage of share capital
3,018,000 2,000,000 1,556,438 891,209 864,590 838,514
16.34% 10.83% 8.43% 4.82% 4.68% 4.54%
106–107
Information for investors
Share performance
Bond
1-year performance (incl. comparison with SPI)
Bond price 12 May 2010 to 31 December 2011
110%
108% 107%
100%
106% 105%
90%
104% 80%
103% 102%
70%
101%
60%
100% Jan.
Feb.
Mar.
Apr.
May
Jun.
Jul.
Aug.
Implenia N
Sep.
Oct.
SPI
Nov.
Dec.
Apr. 10
Jun. 10
Aug. 10
Oct. 10
Dec. 10
Feb. 11
Apr. 11
Jun. 11
Aug. 11
Oct. 11
Dec. 11
Source: Datastream
6-year performance (incl. comparison with SPI) 240% 220% 200% 180% 160% 140% 120% 100% 80% 60% 2006
2007
2008
2009
2010
Implenia N
SPI
2011
Source: Datastream
Share performance
Year-high (in CHF per share) Year-low (in CHF per share) Price at 31.12 (in CHF per share) Average number of shares traded per day Stock market capitalisation at 31.12. (in CHF 1,000)
31.12.2011
31.12.2010
31.12.2009
31.12.2008
31.12.2007
32.50 20.00 23.65
32.00 26.50 31.95
30.10 20.25 29.00
34.60 27.00 29.00
44.70 26.40 34.60
16,990
19,487
10,809
11,688
38,277
436,863
590,180
535,688
535,688
639,131
Bonds In April 2010, Implenia issued a bond for the first time (ISIN: CH0112193518). Worth CHF 200 million, it has a 3.125% coupon and six-year term (matures on 12 May 2016). UBS has confirmed its rating for the Implenia bond as “BBB-/stable”, and ZKB as “BBB/stable”.
108–109
Information for investors
Overview of key figures 2011
2010
2009
2008
2007
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
Balance sheet Cash and cash equivalents Real estate transactions Other current assets Non-current assets Total assets
402,532 247,047 820,059 418,065 1,887,703
349,274 217,983 734,230 375,516 1,677,003
128,749 168,732 726,769 357,544 1,381,794
118,364 180,157 695,586 366,709 1,360,816
47,153 168,049 747,396 379,270 1,341,868
Financial liabilities Other liabilities Equity Total equity and liabilities
209,073 1,135,102 543,528 1,887,703
199,760 981,759 495,484 1,677,003
42,853 912,601 426,340 1,381,794
81,677 855,901 423,238 1,360,816
164,425 772,549 404,894 1,341,868
193,459
149,514
85,896
36,687
(117,272)
Capital structure Equity ratio in % Long-term liabilities in % Short-term liabilities in %
28.8 15.7 55.5
29.5 16.5 54.0
30.9 3.0 66.1
31.1 2.3 66.6
30.2 2.0 67.8
Key figures EBITDA margin in %1 Operating income margin in %1 Return on Invested Capital (ROIC) in %
5.6 3.7 26.8
4.7 3.3 22.4
4.6 3.0 19.9
4.2 2.5 15.3
3.6 1.6 7.4
5,648
5,424
5,350
5,439
5,444
Five-year Group overview 2011
2010
2009
2008
2007
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
Order book
3,153,915
3,070,314
3,445,184
2,958,904
2,512,783
Income statement Production output Consolidated revenue EBIT divisions Miscellaneous / holding company Operating income
2,776,666 2,522,646 93,529 147 93,676
2,716,205 2,388,418 76,997 661 77,658
2,637,277 2,279,835 79,971 (12,328) 67,643
2,541,911 2,324,465 69,950 (10,947) 59,003
2,704,968 2,380,625 65,056 (26,388) 38,668
46,813 140,489
34,894 112,552
36,960 104,603
39,525 98,528
46,010 84,678
61,351
52,458
47,055
39,983
25,534
Depreciation EBITDA Consolidated profit Cash flow statement Cash flow from operating activities Cash flow from investment activities Cash flow from financing activities Free cash flow Investment activities Investments in real estate transactions Real estate disposals Investments in fixed assets
102,449 (35,138) (14,270)
138,516 (98,596) 181,872
119,138 (26,484) (82,333)
183,600 (14,484) (97,517)
(70,176) (43,108) 52,827
67,311
39,920
92,654
169,116
(113,284)
76,459 (29,946) 38,720
50,848 (108,681) 39,496
88,317 (103,104) 36,421
69,257 (67,961) 38,019
43,198 (44,125) 58,235
Net cash position
1 Basis: consolidated revenue IFRS
Headcount (FTE) 2 2 Headcount incl. international
110–111
Information for investors
Communications, contact and key dates Communications Implenia follows an open, transparent and timely information policy in the interests of its shareholders, investors and the general public. In its periodic and ad hoc reporting, Implenia is committed to equal treatment of all stakeholders in terms of timing and content. Comprehensive information is available to all investors, journalists and interested members of the public at www.implenia.com under the “Investor Relations” link. All the latest investor presentations are available here too. By clicking through the “News-Service” link on the site, interested parties can subscribe to our ad hoc communications and order physical copies of our annual report and half-year report. Contact Our CFO, Beat Fellmann, is responsible for ongoing communication with shareholders, investors and analysts:
Tel +41 44 805 45 00 – Fax +41 44 805 45 01 – E-mail beat.fellmann@implenia.com
Key dates 2012 Annual General Meeting of Shareholders Ex-date Payment date Media and analysts’ conference on the 2012 first-half results Media and analysts’ conference on the 2012 full-year results 2013 Annual General Meeting of Shareholders * Dates subject to approval of profit distribution.
4 April 2012 11 April 2012* 16 April 2012* 30 August 2012 26 February 2013 27 March 2013
ETH Excellence Scholarship – creating incentives for young talents There is much talk at the moment about the lack of specialists in Switzerland. Construction companies need to have an adequate supply of well trained, well qualified employees, and the industry faces great challenges in coming years as it tries to recruit enough specialists and young talents. This is why Implenia works so closely with the university sector. It is, for example, helping to fund the Excellence Scholarship Programme at the Federal Institute of Technology (the “ETH”) in Zurich. In the following interview, Nathalie Fontana of the ETH Zurich Foundation explains the programme’s aims and the opportunities it brings.
“There has been an increase of around 19% in people studying construction engineering in recent years.” Nathalie Fontana, Project Manager for Fund Raising, ETH Zurich Foundation
What is the aim of the ETH’s Excellence Scholarship? The Excellence Scholarship Programme supports the effort to train more outstanding young talents for the Swiss labour market. 1– 2% of new masters students – a hand-picked group of no more than 50 across the whole of the ETH – are enrolled into the programme and given a scholarship. The aim of the programme is to promote excellence – it’s more about quality than quantity. The ETH is already a magnet for talent in the international university sector,
but competition is intense. To attract the best people you have to offer incentives and targeted support programmes. Because what we are doing ultimately helps the Swiss economy, industry and the private sector are happy to provide the programme with generous support. Implenia’s support is exemplary for the construction industry. Isn’t such a close relationship with business a bit risky for the ETH’s reputation? Not at all. Everyone benefits from the partnership: Industry can benefit from
the ETH Zurich’s “output” i.e. from outstanding young talent, while the ETH can strengthen its interaction with the business world. Meanwhile, the students get an early insight into career prospects and possible employers. Recipients of the scholarship are selected exclusively by the relevant bodies at the ETH Zurich. The partners have no influence on this process.
How can you ensure that when they have finished their studies the international students also stay, work and use their expertise in Switzerland? The statistics show that around 50% of foreign students in Switzerland also find their first job in the country. However this has to be within three months of graduating; otherwise their visas run out. Graduates look for attractive jobs with development prospects. They want a high standard of living and a stable social environment – economically and politically. All of this speaks in favour of remaining in Switzerland. People say that the construction industry has an image problem among young, well educated people. Is that the way you see it too? We don’t find that, no. There has been an increase of around 19% in people studying construction engineering in recent years. And, interestingly, more and more female students are choosing the subject. This is reflected in the
“It was only thanks to the Excellence Scholarship that I was able to study at the ETH Zurich. It’s great that Implenia is so committed to training young people.” Stella Schieffer, Graduate in Construction Engineering, ETH Zurich
“Construction engineering provides outstanding career possibilities for young talents. I hope that Implenia, as a leading construction company, will continue to offer high quality, innovation and attractive career opportunities for young people. It really helps encourage excellence in our profession.” Anastasis Tsiavos, Master’s student in Construction Engineering, ETH Zurich
scholarship programme too: almost a third of the construction engineering students on the programme are women. What else can the industry do to improve its image? The industry should highlight its modern career paths and working models, and show that it is an attractive industry with lots to offer. And it should
“Implenia’s support is exemplary for the construction industry.” Nathalie Fontana
work hard on communicating success stories based around all the projects it is involved in. Companies like Implenia have a lot of great work to talk about; I’m thinking about things like the historic Gotthard tunnel project. Behind this kind of project there are always people who have achieved extraordinary things. Exciting projects like this, and the highly capable people behind them, act as a powerful magnet for potential employees and talented young people. Construction is still seen as a very male industry. What would you advise a construction company to do if it wants to be more attractive to female construction engineers and architects? The image is created by the jobs available and the associated prospects and career models. It is not necessarily a negative thing per se that the industry
is male-dominated. But I would imagine that attractive, interesting jobs and working models for women – ones that can be combined with family life – are probably still rare. As I said, there is a growing number of female students taking construction engineering courses at the ETH Zurich. So we are starting from a healthy position.
ers were reduced and / or made unequal. In particular, I think that as much as possible should be done to keep people here if they are already studying in Switzerland, because most of them are already very well integrated. The cost of employing these graduates would be relatively low, so ultimately it would be better for all concerned.
Personal freedom of movement is a key factor when recruiting people from abroad. Switzerland’s agreement on freedom of movement is currently coming under political pressure. Could this make the situation difficult for the students you are trying to develop? More than 30% of master’s-level students at the ETH are from outside Switzerland. The figure for doctoral students is over 60%. I believe that it would be a missed opportunity and economically dubious if the quotas for foreign work-
Many thanks for an interesting discussion.
Nathalie Fontana is Fund Raising Manager for the ETH Zurich Foundation, an independent private charitable foundation set up to promote teaching and research at the ETH Zurich. Its “Excellence Scholarship” provides performance scholarships to Swiss and foreign masters students with the aim of nurturing the best young talent and strengthening Switzerland’s expertise and workforce. Implenia supports the construction engineering strand of the course by providing three scholarships a year.
Cost planning is a key function within the construction process. Good construction cost planning creates certainty about costs, quality and timing, which obviously increases customer satisfaction. With its construction cost planning career programme, Implenia is helping to position the job as an attractive career option, shaping a specific specialist career path and investing in its employees’ continuing development.
≤ A construction cost planner’s work is intense, but varied. In order to calculate an offer to a client, Reto Mani reads and analyses construction plans, collects offers from external firms, draws up tables and lists, calculates and negotiates.
≤
The restaurant being built on the summit of the Weisshorn is a new landmark for Arosa, sitting imposingly in a topographically challenging location amidst the magnificent mountainscape. Implenia’s work on the project, designed by renowned architect Thilla Theus, is going according to plan – partly thanks to the good construction cost planning.
Construction cost planners are the financial specialists of the construction industry. They have to hold hundreds of things in their head, know what ev erything costs, understand the relevant planning rules and identify what factors might increase costs or create financial risks. Will health and safety requirements be met? Are there any environmental risks? Does the contract include completeness and functionality clauses? Construction cost planners have to analyse, research and negotiate every single facet of a construction project in minute detail. Finally the figures have to be broken down into a cost per cubic metre – the key figure for the client.
“At Implenia I can get support from a huge network of very knowledgeable people.” Reto Mani, 46, has been a construction cost planner at Implenia in Chur for two years. Mani trained as a draughtsman and construction manager and previously worked at various architecture firms.
Challenging and varied Costs are calculated in several stages, from the first rough estimate of each element – land, shell construction, external fees, etc. – right through to the detailed costing of each individual concrete slab. “It’s a huge job, but very varied because each project is different,” says Remo Mani. The native of Canton Grisons has worked as a construction cost planner at Implenia in Chur for two years, reading plans, analysing, asking for offers, drawing up tables and lists, calculating and negotiating. A cost planner not only has to know a lot about prices, but also needs to have solid construction expertise and refined negotiating skills. A good cost planner has an eye for the big picture. “It starts with the excavation and ends with the painters,” says Hanspeter Villiger, who has 34 years’ experience in construction and 8 as a building construction cost planner at Implenia in Basel. Construction cost planners work under pressure. They normally have only one or two months to submit an offer. “We complete twelve to fifteen projects a year,” says Patrick Tocaben, who started as a construction cost planner with Implenia in Geneva at the age of 39.
“I like the intensive contact with people.” Hanspeter Villiger, 61, has been a construction cost planner at Implenia in Basel for eight years. A trained mason and draughtsman, he has also completed additional training as a foreman and site manager.
“I like the variety of projects at Implenia. I’ve been able to work on lots of different types of building, including hospitals and prisons.” Patrick Tocaben, 49, has been a construction cost planner at Implenia in Geneva for 10 years. French by birth, he studied architecture and construction processes for two years.
Quicker and earlier Construction cost planners at Implenia tend to have had a lot of professional experience, like Mani and Villiger who trained as construction draughtsmen before they moved into the job. Ever tougher and ever more global competi tion in the construction industry, higher volumes of business and shorter deadlines mean that Implenia will need more construction cost planners in the future. In response to this need, Implenia and Lucerne University have launched the “CAS Baukostenplanung GU / TU” training programme (“Certificate of Advanced Studies in Construction Cost Planning for General and Total Contracting”) . The idea behind the course is to help graduates and younger professionals in Switzerland to become construction cost planners earlier and more quickly, and without having to accumulate years of experience in the construction industry. The first pilot course begins in spring 2012 with a maximum of ten participants. “It’s an exciting and innovative project, especially because of the e-learning opportunities,” says Andrea Weber Marin, Deputy Director of Lucerne University. Implenia hopes that the CAS Baukostenplanung GU / TU course will bring construction cost planning more into focus as a career and strengthen its position in the job market. In future, planners should be involved not just at the planning stage, but also during construction so that any cost overruns can be analysed more quickly.
Implenia launches career programme The career programme for construction cost planners at Implenia allows people to take on responsibility for major projects after a year of training. The core element of the programme is the training course “CAS Baukosten planung GU / TU” (“Certificate of Advanced Studies in Construction Cost Planning for General and Total Contracting”) developed by the Technology and Architecture Faculty of Lucerne University in partnership with Implenia. In six modules, participants learn the fundamentals required to succeed as a construction cost planner. They are assisted and supported by an experienced colleague in their day-today work as a construction cost planner at Implenia. They also attend internal training courses and take part in regular experience sharing sessions. The career programme begins this spring. Participants are employed on a permanent basis, i.e. their employment contract continues after the one-year programme has been completed. People can also do the CAS Baukostenplanung GU / TU course without being employed by Implenia. More information can be found on the Lucerne University (Technology and Architecture Faculty) website. www.hslu.ch / wb-bau
02.DE.003.11.11
Construction cost planning – an attractive career option
Karriereprogramm Baukostenplanung + + =
Sie CAS Baukostenplanung Coaching on the job Ihre Karriere bei Implenia
Implenia Management AG Industriestrasse 24 CH-8305 Dietlikon Tel. +41 44 805 45 77 Fax +41 44 805 45 78 www.implenia.com
“Construction cost planning is great because it's so dynamic: the projects, demands and challenges are always changing.” Laura Döring, 39, has been a construction cost planner at Implenia in Dietlikon for three years. She is a construction and industrial engineer who previously worked at various other construction companies.
Corporate Governance
126–127
Group structure and shareholders 128 – Capital structure 131 – Board of directors 135 – Executive committee 144 – Com pensation, shareholdings and loans 148 – Shareholders’ participation 150 – Changes of control and defence measures 152 Auditing body 152 – Information policy 153
128–129
Corporate Governance Group structure
Preamble As required by the SIX Swiss Exchange Directive on Information Relating to Corporate Governance of 29 October 2008 (Directive Corporate Governance, DCG), this chapter describes those main principles of Implenia Group’s organisation and structure that directly or indirectly affect the interests of shareholders and other stakeholders. Unless stated otherwise, information is correct as of the balance sheet date (31 December 2011). The structuring and numbering of this chapter correspond to the scheme set out in the above directive. Implenia Ltd. Board of Directors
1. Group structure and shareholders 1.1 Group structure Implenia Ltd. is a holding company, which directly or indirectly controls all the companies within the Implenia Group.
CEO Anton Affentranger
Corporate Centre / CFO Beat Fellmann
Real Estate René Zahnd
Infrastructure Construction Arturo Henniger
1.1.1 Operational Group structure As at 31 December 2011, the Group’s operational structure was as shown on page 128 (but see footnote 1).
Industrial Construction (International)1 Peter Preindl
Menbers of the Executive Committee as at 1 January 2012: Anton Affentranger, Beat Fellmann, Arturo Henniger, Peter Preindl and René Zahnd 1 This Division was headed by Luzi R. Gruber until the reporting date. Peter Preindl has headed the Division since 1 January 2012.
1.1.2 Listed companies within the Group Implenia Ltd., registered office in Dietlikon (ZH), is a Swiss company that has been listed on the SIX Swiss Exchange (securities no. 002386855, ISIN code CH0023868554, abbreviation IMPN) since 6 March 2006. Its stock market capitalisation as at 31 December 2011 was CHF 436,862,800. Its consolidated holdings do not include any listed companies. 1.1.3 Unlisted companies within the Group The unlisted companies within the Group, including their names, registered offices, share capital and the stake held by the Group, are listed on pages 242 and 243 in the notes to the financial report. 1.2 Significant shareholders The names of known significant shareholders and shareholder groups holding more than 3% of Implenia’s share capital as at 31 December 2011 are shown below.
130–131
Corporate Governance
Between 1 January and 31 December 2011 Implenia Ltd. received the following disclosure notifications concerning shareholdings within the meaning of Articles 20 and 21 of the Federal Act on Stock Exchanges and Securities Trading (Stock Exchange Act, SESTA) of 24 March 1995.
As per last disclosure notification Shareholder
Date of disclosure
Total number of shares
Percentage of share capital
Parmino Holding AG / Max Rössler group
23.11.2009
2,936,950
15.90%
Rudolf Maag
23.11.2009
2,000,000
10.83%
Ammann group2
04.03.2008
1,156,438
6.26%
Ernst Göhner Foundation (via EGS Beteiligungen AG)
20.04.2011
921,614
4.99%
Cazenove Capital Management Ltd.
09.04.2011
891,209
4.82%
As per Share Register on 31.12.2011 Shareholder
Total number of shares
Percentage of share capital
Shares with voting rights
Parmino Holding AG / Max Rössler group
3,018,000
16.34%
3,018,000
Rudolf Maag
2,000,000
10.83%
2,000,000
Ammann group Chase Nominees Ltd. Ernst Göhner Foundation (via EGS Beteiligungen AG) Cazenove Capital Management Ltd.
1,556,438 864,590
8.43% 4.68%
1,556,438
838,514 None registered 3
4.54%
838,514
2
Shares without voting rights
864,590
According to the disclosure notification of 2 January 2012, the Ammann group includes Ammann Group Holding AG, Madisa AG, the pension funds of the Ammann companies, the Arthur und Emma Ammann Foundation, Katarina AmmannSchellenberg, Ulrich Andreas Ammann (new), Katharina Schneider-Ammann (new) and Christoph Ammann (new), with a holding of 1,556,438 shares (8.43%).
3 The shares concerned are not registered in the Share Register.
Date of notification
Shareholder
Total number of shares
Percentage of share capital
10.03.2011 01.04.2011
BlackRock, Inc. group4 BlackRock, Inc. group
923,256 929,412
4.99% 5.03%5
06.04.2011
891,209
4.82%
18.04.2011
Cazenove Capital Management Ltd. Ernst Göhner Foundation (via EGS Beteiligungen AG)
921,614
4.99%
27.05.2011
The Capital Group Companies, Inc. group6
16.09.2011
BlackRock, Inc. group
29.12.2011
Ammann group7
<3% <3% 1,556,438
8.43%
1.3 Cross shareholdings There are no cross shareholdings.
2. Capital structure 2.1 Capital As at 31 December 2011, the share capital amounts to CHF 35,096,800, divided into 18,472,000 registered shares with a par value of CHF 1.90 each. The shares are fully paid up. Conditional capital amounts to CHF 17,548,400. There is no authorised capital. 2.2 Authorised and conditional capital in particular Capital may be increased conditionally by a maximum of CHF 17,548,400 by issuing a maximum of 9,236,000 registered shares with a par value of CHF 1.90 each to be fully paid up. The capital increase takes place following the exercise of conversion and / or option rights issued in connection with bonds or other financial market instruments of the company and / or of the Group companies. Existing shareholders’ preferential subscription rights are excluded. Holders of the relevant conversion and / or option rights are entitled to subscribe to the new registered shares. The Board of Directors fixes the conditions for the conversion and / or the option. 4 5 6 7
As well as the parent company BlackRock, Inc., the BlackRock, Inc. group includes BlackRock Holdco 2, Inc., BlackRock Financial Management, Inc., BlackRock Advisors Holdings, Inc., BlackRock International Holdings, Inc., BR Jersey International Holdings LP, BlackRock Group Ltd., BlackRock Holdco 4, LLC, BlackRock Holdco 6, LLC, BlackRock Delaware Holdings, Inc., BlackRock Luxembourg Holdco S.à.r.l., BlackRock Advisors UK Ltd., BlackRock Institutional Trust Company, N.A., BlackRock (Luxembourg) S.A. and BlackRock Investment Management (UK) Ltd. The BlackRock, Inc. group has reported acquired positions totalling 5.16% (in addition to the figure in the table, a CFD stake amounting to 24,073 shares [0.13%]). The reported group based around the holding company The Capital Group Companies, Inc. also includes The Capital Research and Management Company, Capital Guardian Trust Company, Capital International Ltd., Capital International S.à r.l. and Capital International K.K. See footnote 2.
132–133
Corporate Governance
The Board of Directors may partially or entirely exclude shareholders’ preferential subscription rights when bonds or other financial market instruments are issued with conversion and / or option rights if these instruments are being issued to finance or refinance the acquisition of companies, parts of companies, participations or new investment projects, and / or if the instruments are issued on the national or international capital markets. If the Board of Directors resolves that the preferential subscription right will not be granted directly or indirectly, (1.) the bonds or other money market instruments must be issued at market conditions, (2.) the new registered shares must be issued at market conditions, taking due consideration of the stock market price of the registered shares and / or comparable instruments priced by the market, and (3.) it should be possible to exercise the conversion and / or option rights within a period of no longer than 10 years from the relevant issue date. The acquisition of shares through the exercise of conversion and / or option rights and any subsequent transfer of the registered shares are subject to the registration restrictions pursuant to Art. 7 Para. 4 of the articles of association of Implenia Ltd. (see point 2.6 below). There were no capital increases in 2011. Neither was there any authorised capital as at 31 December 2011.
2.4 Shares and participation certificates As at 31 December 2011, the share capital is divided into 18,472,000 fully paid up registered shares with a par value of CHF 1.90 each. Each share entitles the holder to one vote at the General Meeting of Shareholders and to dividends. There are no voting right shares or other shares with similar advantages. There are no participation certificates. 2.5 Dividend-right certificates There are no dividend-right certificates. 2.6 Limitations on transferability and nominee registrations
2.3 Changes in capital over the last three years of Implenia Ltd.
Share capital8
31.12.2011
31.12.2010
31.12.2009
CHF 1,000
CHF 1,000
CHF 1,000
35,097
51,721
64,652
16,185
13,686
–
13,686 6,292 40,873 20,780
136,808
113,616
60,465
20,400
21,359
20,553
272,103
268,327
259,899
Legal reserves – General reserves – Reserves for treasury shares – Reserves from capital contributions Voluntary reserve
4,460 59,153
38,890 40,873 20,780
Profit and loss account: – profit carried forward – profit for the year Equity
8 The changes in share capital over the last three years shown are due to reductions in par value.
2.6.1 Percentage clause There is no percentage clause which would allow any limitation of transferability of Implenia shares. Pursuant to Art. 7 Para. 4b of Implenia Ltd.’s articles of association, the Board of Directors can refuse to enter an owner of registered shares as a shareholder with voting rights in the Share Register if information available to the company indicates that recognition of this owner as a shareholder would or could prevent the company and / or its subsidiaries from providing the legally required evidence about the composition of its shareholder body and / or the beneficial owners of the shares. In connection with the project development and real estate business run through the corporation’s subsidiaries, the corporation is specifically entitled to refuse to register persons abroad (pursuant to the Federal Law of 16 December 1983 on the Acquisition of Real Estate by Persons Abroad, BewG), if such registration could raise any doubt about the Swiss control of the corporation and / or its subsidiaries. The details of how this article is implemented are set out in the Board of Directors’ regulation entitled “Regulations on the Registration of Registered Shares and Keeping of the Share Register of Implenia Ltd.” (“Registration Regulations”). The Registration Regulations are available at www.implenia.com, under “Investor Relations” – “Regulations”).
134–135
Corporate Governance
The Registration Regulations state that the Board of Directors shall enter a foreign shareholder in the Share Register as a shareholder with voting rights, provided: (i) the foreign shareholder meets the conditions that apply to all shareholders (points 2 to 4 of the Registration Regulations) (ii) total foreign-owned shares entered with voting rights in the Share Register (including the shares of the foreign shareholder concerned) do not account for more than 20% of all shares entered with voting rights in the Share Register, and (iii) the number of shares entered with voting rights in the Share Register that are held by the foreign shareholder concerned does not exceed 10% of all shares entered with voting rights in the Share Register. Above these limits, foreign shareholders will only be registered if a decision by the competent authorities is presented at Implenia’s headquarters to the effect that Implenia and its subsidiaries shall not be considered as foreign-controlled even after the new foreign shareholder is entered in the Share Register. Any shareholder falling within the definition of a person living abroad as per Art. 5 of the Federal Law on the Acquisition of Real Estate by Persons Abroad (BewG) in conjunction with Art. 6 BewG, and any nominee who has not disclosed the identity of the shareholders it is representing, shall be considered as a foreign shareholder within the meaning of this clause. 2.6.2 Reasons for granting exceptions No exceptions were granted during the year under review. 2.6.3 Admissibility of nominee registrations According to section 4 of the Registration Regulations, nominees are persons who do not explicitly declare in their application for registration that they hold the shares for their own account. According to Art. 7 Para. 4a of the company’s articles of association, nominees will be entered in the Share Register if they declare in writing that they are prepared to disclose the names, addresses and shareholdings of any persons for whose account they are holding the shares. Art. 7 Para. 4a of the articles of association says the following: “Acquirers of registered shares are registered in the Share Register with the right to vote upon request if: (a) they can prove that they acquired and hold these registered shares in their own name and for their own account. Persons who do not provide such evidence shall only be registered as nominees with the right to vote in the Share Register if they undertake in writing to disclose the names, addresses and the number of shares of the persons for whose account they hold shares, or if they disclose this information immediately in writing on first request. The remaining provisions of the articles of association, in particular Articles 4, 11 and 13, apply by analogy to nominees. The board of directors is empowered to enter into agreements with nominees regarding their notification duties.”
Pursuant to Para. 4 of the Registration Regulations, the Board of Directors will enter nominees in the Share Register as shareholders with voting rights up to an acknowledged percentage of 1% of the total registered share capital entered in the commercial register, as long as the nominees declare in writing that they are prepared to disclose the names, addresses and shareholdings of any person for whose account they are holding the shares, or if they disclose this information immediately in writing on first request. The nominees must have concluded agreements with the Board of Directors regarding their position. Registered shares held by a nominee will only be entered in the Share Register with voting rights above this 1% limit if the nominee concerned discloses the names, addresses, place of residence or domicile and shareholdings of any person for whose account they are holding 0.25% or more of the registered share capital entered in the Commercial Register. Registration as a nominee requires that the nominee has made a valid application using the “Application for Registration as Nominee” form (available at www.implenia.com, then click on “Investor Relations” – “Application”). 2.6.4 Procedure and conditions for cancelling privileges granted under the articles of association and limitations on transferability There are no privileges under the articles of association, and the cancellation of transferability restrictions requires a resolution by the General Meeting of Shareholders adopted by at least two thirds of the votes represented at the meeting. 2.7 Convertible bonds and options There are no outstanding convertible bonds or options.
3. Board of Directors 3.1 Members of the Board of Directors The Board of Directors has seven members. At the Annual General Meeting of Shareholders of 19 April 2011, Moritz Leuenberger and Theophil H. Schlatter were appointed as new members. On 1 October 2011 the Board of Directors appointed Anton Affentranger as the new CEO of Implenia. Anton Affentranger – up until that point Chairman of the Board of Directors – stepped down from the Board of Directors. The new Chairman of the Board of Directors is Markus Dennler, who had been Vice Chairman of the Board since the merger in spring 2006. Hans-Beat Gürtler was elected as the new Vice Chairman. None of the Members of the Board of Directors has an operational management role in the company or any of its subsidiaries. No Member of the Board of Directors was part of Implenia Ltd.’s Executive Committee or part of the operational management team of any Group company in the three years before the period under review. No member of the Board of Directors has any significant business relationships with the Implenia Group.
136–137
Corporate Governance Board of Directors
1
5
2
6
1 Markus Dennler (born 1956, Swiss) Markus Dennler has been Chairman of the Board of Directors of Implenia Ltd. since 1 October 2011, having previously served as Vice Chairman from March 2006. He was Chairman of the Board of Directors of Batigroup Holding AG between 2005 and the company’s merger with Zschokke Holding AG in 2006. He is also a Member of the Board of Directors of Swissquote Holding AG and Petroplus Holdings AG, and Vice Chairman of the Board of Allianz Suisse; he is also a Member of the Board of the British-Swiss Chamber of Commerce. After leaving the University of Zurich with a doctorate in law, he qualified to practise as an attorney. He joined Credit Suisse Group in 1986, and in 2000 became a Member of the Executive Board of Credit Suisse Financial Services. At the beginning of 2005 Markus Dennler set up his own legal practice in Zurich.
3
4
7
2 Hans-Beat Gürtler (born 1946, Swiss) Hans-Beat Gürtler has been Vice Chairman of the Board of Directors since October 2011. He has been a Board Member since April 2010. He is a Management Partner of Varuma, a private equity firm in Basel, as well as a Member of the Board of Basilea Pharmaceutica AG in Basel, and a Member and President of the Boards of Directors of several Swiss-based private companies, most of them start-ups and SMEs, primarily in the pharma / biotech sector. Prior to joining Varuma, he held the position of Global CEO at Novartis Animal Health, where he was responsible for the worldwide business, including research, development, manufacturing and marketing of animal pharmaceuticals for pets and farm animals. Previously, Mr. Gürtler held various increasingly senior management positions at Ciba-Geigy Ltd. As CEO of Mahissa, Ciba-Geigy’s seeds business in Spain, he lived in Barcelona for several years. Hans-Beat Gürtler holds a commercial diploma.
3 Patrick Hünerwadel (born 1959, Swiss) Patrick Hünerwadel has been a Member of the Board of Directors since March 2006. He is a partner at the Lenz & Staehelin law firm (since 1994) and he teaches courses in company law and general law of obligations at the University of Saint Gallen. He was a Member of the Board of Directors of Batigroup Holding AG from 1997, and Vice Chairman from 1999 until the merger with Zschokke Holding AG. He holds a degree and a doctorate in law from the University of St. Gallen. Patrick Hünerwadel qualified to practise in Zurich. 4 Moritz Leuenberger (born 1946, Swiss) Moritz Leuenberger has been a Member of the Board of Directors since April 2011. Between 1972 and 1991, he ran his own legal practice in Zurich. From 1979 to 1995 he was a National Councillor, holding various posts including Chair of the Company Law Reform Commission and the Parliamentary Investigations Commission. Between 1991 and 1995 he was a member of Zurich’s Cantonal Government and, among other functions, was Head of the Cantonal Interior and Justice Ministry. From 1995 to 2010 he sat on Switzerland’s Federal Council and was Head of the Federal Department for the Environment, Transport, Energy and Communications. Under him, the Department was made into a ministry of sustainability, leading the way on reconciling infrastructure and environmental interests. He was given many awards for this work, including an honorary doctorate from the University of Udine for innovative traffic policy using European Union Law. He headed the Swiss delegations to international climate and energy negotiations. In 2001 and 2006 he additionally performed the role as President of the Swiss Confederation. He has written many books including “Lüge, List und Leidenschaft. Ein Plädoyer für die Politik” (2007). Since leaving the Federal Council Moritz Leuenberger has, among other things, headed the Swiss Aviation Foundation. 5 Theophil H. Schlatter (born 1951, Swiss) Theophil H. Schlatter has been a Member of the Board of Directors since April 2011. From 1997 until his retirement in March 2010 he was CFO and a member of the Executive Committee of Holcim Ltd. Before that he was CFO and Ex-
ecutive Committee Member of Holcim (Schweiz AG), and from 1991 until 1995 was Head of Finance and a member of the Executive Committee of Sihl Zürcher Papierfabrik an der Sihl. He started his career at STG-Coopers & Lybrand AG as an auditor and then moved to Holcim Group Support AG’s Corporate Controlling department. He is currently a Member of the Boards of Directors of Swisscom AG and Schweizerische Cement-Industrie-Aktiengesellschaft. He is Chairman of the Board of Directors of Pekam AG. Theophil H. Schlatter graduated with a degree in economics from the University of St. Gallen, and he is also a qualified auditor. 6 Toni Wicki (born 1944, Swiss) Toni Wicki has been a Member of the Board of Directors since March 2006. From April 2009 to August 2010 he was the Board’s Independent Lead Director. He is a Member of the Supervisory Board of Rheinmetall AG and of the Board of Trustees of the Stiftung Museum und historisches Material der schweizerischen Luftwaffe. He was previously CEO and Delegate of the Board at RUAG Holding and before that held various positions in technology businesses, including ABB and Leica. He was Chief of Weaponry for the Swiss Army. Until its merger with Batigroup Holding AG, he was Vice Chairman of the Board of Directors of Zschokke Holding AG. Toni Wicki qualified as a mechanical engineer from the Federal Institute of Technology in Zurich. 7 Philippe Zoelly (born 1948, Swiss) Philippe Zoelly has been a Member of the Board of Directors since March 2006. He is a partner at a law firm in Geneva. He works mainly on consultancy, negotiation and court-room litigation in commercial matters, particularly in the fields of civil liability and insurance law, bankruptcy law and copyright management. He also takes on official mandates as a fiduciary and company administrator. He is a Member of the Board of Directors of the Swiss Society of Authors (Société Suisse des Auteurs – SSA) and chairman of the SSA’s Emergency Fund. He was a Member of the Board of Directors of Zschokke Holding AG from 2005. He holds a law degree from the University of Fribourg. Philippe Zoelly qualified to practise law in Geneva.
138–139
Corporate Governance
3.4 Internal organisational structure
3.4.1 Allocation of tasks within the Board of Directors There is no formal distribution of responsibilities within the Board of Directors except for the Chairman’s powers of authority as described here. In general, the tasks and powers of the Chairman are as defined in the law, the articles of association, Implenia Ltd.’s Organisational Regulations (referred to hereinafter as “Implenia’s OR”) 9 and the functions diagram, plus any tasks and powers delegated by specific resolutions of the Board of Directors (Section 2.8a Para. 1 Implenia’s OR). 3.2 Other activities and vested interests This information is given above in the individual profiles of each Board Member. 3.3 Elections and terms of office
3.3.1 Principles of the election procedure and limits on terms of office At the Annual General Meeting of Shareholders of 19 April 2011, Moritz Leuenberger and Theophil H. Schlatter were appointed as new members. The term of office of Board Members is two years. This term commences on the date of their election and ends on the date of the Annual General Meeting of Shareholders at the end of their terms of office, unless they resign or are dismissed before this. Members of the Board of Directors can be re-elected at any time, but they are subject to an upper age limit of 70 years; when they reach this age limit, they must leave the Board at the next Annual General Meeting of Shareholders. The Chairman, the Vice Chairman and the Secretary are appointed by the Board of Directors. 3.3.2 First election and remaining term of office The dates on which each Member of the Board of Directors was first elected, as well as the dates of their re-election and details of their remaining terms of office are given in the following table: Member of the Board of Directors
First elected
Re-elected
Term ends
Markus Dennler
20.12.2005
14.04.2010
AGM 2012
Hans-Beat Gürtler
14.04.2010
Patrick Hünerwadel
20.12.2005
14.04.2010
AGM 2012
Moritz Leuenberger Theophil H. Schlatter
19.04.2011 19.04.2011
Toni Wicki
20.12.2005
14.04.2010
AGM 2012
Philippe Zoelly
20.12.2005
14.04.2010
AGM 2012
AGM 2012 AGM 2013 AGM 2013
The Chairman chairs meetings of the Board of Directors. The Chairman is empowered to nominate the Members of the Boards of Directors of the companies in which Implenia has a shareholding of at least 50%. However the only members of the Executive Committee that he may nominate as Board Members are the CEO and CFO. He is authorised in emergencies to perform tasks normally reserved to the Board of Directors if a decision cannot be taken by the Board in time, and if the Chairman may reasonably expect the Board to agree with his actions. In such cases he must inform the Members of the Board of Directors immediately about what he has done. In addition, the Chairman has the right to obtain information from the Members of the Executive Committee at any time (Section 2.3c and 2.8 of Implenia’s OR). If the Chairman is unable to carry out his duties or exercise his powers, the Vice Chairman, or if necessary another Member of the Board of Directors to be specified, shall do so in his place (Section 2.8d Implenia’s OR)
3.4.2 Members list, tasks and areas of responsibility for each committee of the Board of Directors The Board of Directors has formed four committees – the Audit Committee, the Nomination and Remuneration Committee, the Strategy Committee and the Sustainability Committee. These committees analyse the relevant areas and submit reports to the Board of Directors so it can prepare decisions or perform its monitoring function. The Chairs of the individual committees inform the Board of Directors about all major points and give recommendations for the decisions that have to be taken by the Board as a whole. The committees’ powers are set out in Implenia’s OR and in the regulations of each committee. The Sustainability Committee was set up during the year under review.
9
As part of a general best practice review, Implenia’s OR and all the company’s regulations were redrafted and issued by the Board of Directors on 20 January 2012, when they entered into force. Two new regulations were produced to help standardise certain organisational processes and precautions (Signature Regulation and Insider Trading Regulation). In conjunction with the second of these two regulations, the existing regulation of disclosure of management transactions was tightened up. The main changes to Implenia’s OR involved detailed rules about the Executive Committee, the function of the CEO / Head Corporate Centre, standardisation of the committees and the CEO’s right of veto in the Executive Committee. Implenia’s OR is available at www.implenia.com, under the link “Implenia” – “Organisational Regulations”. As mentioned in the preamble, the regulations and situation are reported as they stood on the reporting date.
140–141
Corporate Governance
The committees and their memberships are shown in the table below: Member of the Board of Directors
Audit Committee
Markus Dennler Hans-Beat Gürtler Patrick Hünerwadel
Nomination and Remuneration Committee
Strategy Committee
Sustainability Committee
•
• (Chairman)
•
• (Chairman)
•
•
Moritz Leuenberger
•
Theophil H. Schlatter
•
Toni Wicki Philippe Zoelly
• (Chairman)
• (Chairman)
•
The Audit Committee is made up of at least three Members of the Board of Directors. As the Board of Directors’ control committee, the Audit Committee is responsible for internal controls and the correct application of accepted and statutory accountancy principles. It coordinates and harmonises the work of the internal and external auditors. It is responsible for regular communication between internal and external auditors and the Board of Directors. It formulates instructions for the internal and external audit bodies. It has the authority to order special audits where necessary (Section 3.1 Implenia’s OR). The Nomination and Remuneration Committee is made up of at least three Members of the Board of Directors. It prepares the Board of Directors’ and Executive Committee’s succession planning and helps the Board of Directors select suitable candidates for posts on the Board of Directors and Executive Committee. The Nomination and Remuneration Committee helps the Board of Directors and CEO to decide on remuneration at the company’s most senior levels, i.e. the Board of Directors and Executive Committee (Section 3.2 Implenia’s OR). The Strategy Committee is made up of at least three Members of the Board of Directors. It helps the Board of Directors and Executive Committee determine corporate development and strategy. It also performs any other related tasks delegated to it by the Board of Directors (Section 3.3 Implenia’s OR). The Sustainability Committee consists of at least two Members of the Board of Directors. In collaboration with the Executive Committee it proposes Implenia’s sustainability strategy to the Board of Directors. Together with the Executive Committee it evaluates the business areas on which Implenia should focus with regard to long-term sustainability, and it increases awareness of sustainable thinking and action throughout the company. It reviews the annual sustainability report and makes proposals to the Board of Directors. Finally, it conducts investigations into all matters within its area of responsibility, or commissions independent experts or others to do so.
The members of the Audit Committee, the Nomination and Remuneration Committee, the Strategy Committee and the Sustainability Committee are appointed by the Board of Directors. Each of these committees organises itself and draws up its own regulations, which must be approved by the Board of Directors. The committees are advisory bodies; decision-making power is reserved for the Board of Directors as a whole. 3.4.3 Work methods of the Board of Directors and its committees The Board of Directors and its committees meet as often as business requires, but at least six times a year (Board of Directors) and twice a year (committees). Meetings take place at the invitation of the relevant chairperson. Invitations are accompanied by an agenda and meeting documents. In addition, each member is entitled to request that a meeting be convened and can request that items are added to the agenda. Each meeting is chaired by the chair. Meetings are quorate if the majority of members are in attendance. The Board of Directors and its committees pass resolutions and elect members by simple majority of votes cast by attending members. If votes are tied, the person chairing the meeting has the casting vote (in addition to his normal vote). Minutes are taken of all meetings. Members of the Executive Committee regularly participate without voting rights in some meetings of the Board of Directors and its committees, as does the auditor in meetings of the Audit Committee (Section 2.3 and 2.4 Implenia’s OR). During the year under review, the Board of Directors held eleven meetings convened by its Chairman, with three of these meetings taking the form of a telephone conference. The average length of its meetings was seven hours. The length of telephone conferences averaged one hour. Before the CEO function was passed on to Anton Affentranger, the Executive Committee was represented at all but one of the meetings by Hanspeter Fässler. Following the handover, the new CEO attended at least part of the two remaining meetings of the Board of Directors. The CFO attended at least part of all the meetings that took place during the year under review. The Audit Committee met three times during the year under review. The average duration of these meetings was six hours. The new and the former CEO, the CFO and the Head of Finance and Controlling (F&C) took part in all meetings of the Audit Committee. The auditor attended at least part of every committee meeting during the year under review. The Nomination and Remuneration Committee held three meetings. The average duration of these meetings was two hours. The former and the new CEO attended at least part of the committee meetings. In addition, the CFO and the Head of Human Resources attended some of the meetings. The Strategy Committee met four times during the year under review. The average duration of these meetings was two hours. The former CEO attended part of one of the committee meetings. There were no further meetings after the change in CEO. The Sustainability Committee met once for two hours. As well as the members of the committee, the former CEO and the Managing Director of Reuss Engineering AG took part in this meeting.
142–143
Corporate Governance
3.5 Definition of areas of responsibility In accordance with Implenia’s OR, the Board of Directors has delegated the management of Implenia Ltd. and its subsidiaries to the CEO, with the exception of the responsibilities that are reserved for the Board itself by the law, the articles of association and Implenia’s OR. The CEO is responsible for operational management to the extent that it is not assigned to other bodies by the law, articles of association or Implenia’s OR. He is responsible for managing the Group’s business and for representing the Group, and especially for its operational management and for implementing strategy. He is empowered to arrange and / or carry out the duties and powers of authority assigned to him by Implenia’s OR, unless these are reserved for the Board of Directors. The CEO delegates management of the business in accordance with Implenia’s OR to the Members of the Executive Committee (Section 4.2a Implenia’s OR). The CEO informs the Chairman of the Board of Directors and the Board of Directors when required and on request about the general business performance, about specific transactions and about decisions he has taken. Unusual events must be brought to the attention of the Chairman of the Board of Directors and if necessary to the Members of the Board of Directors without delay, either in writing or verbally (Section 4.2b Implenia’s OR). The Members of the Executive Committee have full operational responsibility for managing their allocated business areas. They are responsible for the results achieved by their allocated areas and they report to the CEO (Section 4.3 Implenia’s OR). As well as the powers of authority reserved under Art. 716a of the Swiss Code of Obligations, the Board of Directors also decides on the following major areas of business as shown on the function diagram: production / engineering procurement construction (incl. GC / TC business) in Switzerland worth more than CHF 150 million (Implenia’s share) and abroad worth more than CHF 75 million; consultancy, engineering and management contracts in Switzerland worth more than CHF 15 million (Implenia’s share) and abroad worth more than CHF 15 million; selecting partners for collaboration on projects of all types (joint ventures and other forms) in Switzerland worth more than CHF 200 million and abroad worth more than CHF 100 million; promotional and development projects (standard promotions) with a maximum budget (real case) of more than CHF 15 million; non-budgeted purchases and sales of land, buildings and sites (commercial property) worth more than CHF 15 million; unbudgeted property, plant and equipment worth more than CHF 15 million; acquisition and sale of investments (enterprise value) worth more than CHF 10 million; entering into or exiting long-term joint ventures or strategic partnerships (relationships extending beyond one project); procurement of debt capital of more than CHF 50 million; granting loans to third parties of more than CHF 2 million; long-term financial investments (more than three months) of more than CHF 15 million; issuing group sureties, guaranties, bid, performance and payment bonds, etc. other securities and assumptions of contingent liabilities outside normal business activity worth more than CHF 2 million; and initiating legal proceedings or making settlements involving sums of more than CHF 15 million.
3.6 Information and control instruments vis-à-vis the Executive Committee To monitor how the CEO and members of the Executive Committee perform the tasks entrusted to them, the Board of Directors has the following information and control tools at its disposal: Annual
MIS (Management Information System) Financial statements (balance sheet, income statement, operating accounts, cash flow statement, by division and consolidated) Budget (by division and consolidated) Rolling three-year plan (by division and consolidated) Risk management report
Semi-annually
Quarterly
Monthly
•
• • • •
The MIS (Management Information System) provides monthly reporting on how business is going. The MIS report contains information about turnover, margins, costs and the operating result, plus information about orders on hand, capital spending, invested capital, liquidity and headcount. The relevant documents are submitted to the Executive Committee and the Board of Directors together with a quarterly updated commentary and an estimate for the year as a whole. The accounts are reported every quarter with the IFRS financial report and the internal reporting, which details the business performance to date and gives an estimate of year-end figures. As part of the budget planning for the following year, the key figures used in the MIS are estimated on the basis of expected economic developments, and defined along with the business goals for each division. These are then used to prepare the budgeted balance sheet, income statement, cash flow statement and liquidity position. The annual planning for the coming three calendar years (rolling three-year plan) is done in the same way as the budget. Operational and financial risks for each division are assessed by the relevant operational manager every six months and consolidated by the F&C Department. The recorded risks are divided for the most part into “key projects”, “other projects”, “financial risks” and “management risks”, and evaluated qualitatively (scale and likelihood) and quantitatively (worst / real / best case). The measures taken by the operational managers are then monitored by the F&C Department. The Head of F&C presents a commentary on and explanation of the risk management report directly to the Audit Committee.
Corporate Governance GROUP MANAGEMENT
144–145
The internal control system is examined by the external auditor, which reports its findings to the Board of Directors in accordance with the law (Art. 728a Para. 1 clause 3 and 728b Para. 1 SCO). The reporting tools mentioned above are prepared by the F&C Department and presented simultaneously in consolidated form to the Board of Directors and Executive Committee. The reporting is presented and explained by the CFO and Head of F&C at the Executive Committee and Audit Committee meetings. The Executive Committee presents the Board of Directors with a detailed analysis at each meeting of the Board. The CEO, the CFO and the Head of F&C take part in all meetings of the Audit Committee. They provide detailed information about the business performance, make any necessary comments about this and answer questions from the members of the Audit Committee. The Board of Directors has hired a well-known audit company to perform the internal audit function. The main focuses of the internal audit are set by the Audit Committee on the basis of the long-term audit plan. During the year under review the focus was on monitoring compliance, invoicing, following the functions diagram and procurement. The project plan for internal audit activities is prepared by the external auditor and implemented in consultation with the CFO. Internal audit reports are produced and submitted to the Audit Committee together with the necessary comments and recommendations. The internal auditor reports directly to each meeting of the Audit Committee. The internal auditor’s reports are given to the external auditors without qualification. There is regular communication between the internal and external auditors. 4. Executive Committee During the year under review Hanspeter Fässler served as CEO until his resignation on 30 September 2011. On 1 October 2011 the Board of Directors appointed Anton Affentranger, until that point Chairman of the Board of Directors, as the new CEO. Anton Affentranger simultaneously stepped down from the Board of Directors and gave up operational management of his private companies. As CEO, he is responsible for the management of Implenia Ltd. and its subsidiaries. He heads the Executive Committee, which is divided into different divisional responsibilities, each with its own head. Peter Preindl has been a Member of the Executive Committee since 1 October 2011. On 1 January 2012, he took over as the Head of the Industrial Construction Division from Luzi R. Gruber, who remains available to Implenia in an advisory capacity. Peter E. Bodmer stepped down from the Executive Committee on 30 June 2011. He also continues to support Implenia in an advisory capacity. 4.1 Members of the Executive Committee (see following pages)
Arturo Henniger, Anton Affentranger, Beat Fellmann, René Zahnd and Peter Preindl (from left) on the 16th floor of the Main Tower in Oerlikon that Implenia General Contracting Ltd is implementing.
146–147
Corporate Governance GROUP MANAGEMENT
Anton Affentranger (born 1956, Swiss) Anton Affentranger has been CEO of Implenia since October 2011. From March 2006 to September 2011 he was Chairman of the Board of Directors. Between 6 April 2009 and 31 August 2010 he was the Executive Member of the Board (as Chairman and CEO). He is also the founder and chairman of Affentranger Associates AG and various start-up companies. He worked for UBS in New York, Hong Kong and Geneva, and was a member of the bank’s Executive Board at its head office in Zurich. He was also partner and CEO of the private bank Lombard Odier & Cie and CFO of Roche Holding AG. In 1999 he joined the Board of Directors of Zschokke Holding AG, becoming Chairman in 2003. Anton Affentranger graduated from the University of Geneva with an economics degree. On 1 October 2011 he was appointed by the Board as the new CEO of Implenia. On the same date he stepped down from the Board of Directors and from the operational management of his private companies. Beat Fellmann (born 1964, Swiss) Beat Fellmann has been Implenia’s CFO and Head of Corporate Centre since October 2008. He graduated with a degree in economics from the University of St. Gallen, and he is also a qualified auditor. He began his career as an internal auditor with the international industrial group Bühler, where he became assistant to the CEO and Chairman before becoming a specialist in financing projects. In 1998 he joined Holcim Group, where he was Head of Financial Holdings. In this role he reported to the CFO and was responsible for all financial and holding companies worldwide. In January 2005 Beat Fellmann became deputy group CFO at Holcim and was also made responsible for group tax, as well as for the management company’s IT, finance and controlling.
Luzi R. Gruber (born 1951, Swiss) Until 31 December 2011, Luzi R. Gruber was in charge of the Industrial Construction Division, which within Implenia Construction Ltd. includes the Underground Construction and Total Contracting businesses. He graduated in civil engineering from the Federal Institute of Technology (FIT) in Zurich and was teaching and scientific assistant to Prof. Christian Menn at the FIT from 1976 to 1979. From 1979 to 1993 he was site manager, project manager and operational manager at LGV Impresa Costruzioni SA; from 1993 to 1996, head of production for the Eastern region of Conrad Zschokke SA; from 1996 to 1997, head of Division IV of the Stuag SA Group; and from 1997, he was in charge of the tunnels & bridges section and a member of management at Batigroup. In this capacity, he headed the Major Projects and Infrastructure East divisions. He is the chairman of the steering committee of Swissconditions (SIA 118 standards) within the Swiss Association for Standardisation (SNV), a member of the managing committee of the INFRA trade association, and of the SIA (specialists in underground construction), as well as a member of the Normenbeirat Bau (NBB). Luzi R. Gruber has made himself available to Implenia from 2012 in a consultative capacity for strategic issues and selected projects.
Arturo Henniger (born 1956, Swiss) Arturo Henniger is in charge of the Infrastructure Division, which within Implenia Construction Ltd. includes buildings, roads and civil engineering works, engineering construction works and special works. After graduating as an engineer from the Federal Institute of Technology in Zurich, he worked from 1982 to 1988 as a director of works for different companies in South Africa and Italy. From 1988 to 1997 he worked for Locher & Co AG as site manager for various major tunnelling projects. He joined the Zschokke Group in 1998. As Head of Industrial Projects Arturo Henniger headed Zschokke Locher SA until its merger in 2005 with Zschokke Construction SA, at which point he took over the management of that company. Peter Preindl (born 1956, Austrian) Peter Preindl has been part of Implenia’s Executive Committee since 1 October 2011 and has headed the Industrial Construction Division since 1 January 2012. After studying environmental and water management at the University of Vienna, Peter Preindl, who comes from Innsbruck, graduated in engineering in 1979 before taking his doctorate in Vienna in soil mechanics and foundation engineering. After working as a construction manager on tunnelling, water and foundation engineering projects, he took on management positions for various civil and foundation engineering companies before joining ALPINE Bau GmbH in Vienna as branch manager. He gradually took on more and more responsibility at the company, and in 2006 was appointed to the executive board. In 2009 Peter Preindl was appointed CEO of ALPINE Bau, leading its operational management in this capacity until spring 2011.
René Zahnd (born 1966, Swiss) René Zahnd has headed the Real Estate Division since 1 March 2010. In this capacity, he manages Implenia Generalunternehmung AG, Implenia Development AG, Implenia Immobilien AG, Reuss Engineering AG and Tetrag Automation AG. He studied law and is qualified to practice as an attorney. He worked in a law practice and at Berner Kantonalbank, specialising in construction, planning and real estate law. His in-depth experience in the construction and real estate industry began when he became head of legal services at Losinger Construction AG. In 2004 he took over operational responsibility for project development in Losinger’s central region. In 2007 he moved to Bern-based general contractor Marazzi, where he was responsible for project development in German-speaking Switzerland. From May 2009, René Zahnd was in charge of Implenia’s project development in German-speaking Switzerland, and in this role was a Member of Implenia Real Estate’s Executive Committee.
Corporate Governance
4.2 Other activities and vested interests This information is given above in the individual profiles of each Member of Executive Committee. 4.3 Management contracts There are no management contracts with third parties.
5. Compensation, shareholdings and loans 5.1 Content and method of determining the compensation and the shareholding programmes The compensation of serving Members of the Board of Directors and Members of the Executive Committee is determined every two years (Members of the Board of Directors) or every year (Members of the Executive Committee) by the Board of Directors in response to proposals from the Nomination and Remuneration Committee and after considering the market situation. The compensation paid to the Board of Directors was reviewed during the previous reporting year and adjusted on the basis of benchmark analyses against other Swiss companies working in the construction and associated industries, such as Forbo Holding AG, Geberit AG and Sika AG. Compensation was decided for the subsequent two years, i.e. up until the Annual General Meeting of Shareholders in 2012. The size, basis, and components of the compensation are based on the Regulation on Compensating Members of the Board of Directors of Implenia Ltd. Also during the previous reporting year, in preparation for a new management system being introduced during the course of 2011 and 2012 for all office-based staff, the compensation paid to Members of the Executive Committee was analysed by the consultancy firm Hay Group. It evaluated the functions performed by Members of the Executive Committee using the Hay Group Guide Chart-Profile Method. Hay Group put together a reference market of functions with similar value, determined median and quartile values for the individual components of remuneration within this reference market, and then compared these values with the compensation paid to Members of the Executive Committee (+/–20% range). The reference market included comparable functions from Switzerland’s top executive market. It focused on companies from the industrial and semi-industrial sectors including Caterpillar SARL, Hilti (Schweiz) AG, Holcim Group Support Ltd., Honeywell AG, Karl Steiner AG, Schindler, Siemens Switzerland Ltd. Building Technologies Group, Sika AG and Treuhand Liegenschafts Immobiliengesellschaft. The consultancy firm has no further mandates with Implenia. As in the previous year, the Board of Directors has decided to propose to the Annual General Meeting of Shareholders (4 April 2012) that it approve the Board’s and Executive Committee’s compensation with a consultative vote.
148–149
Board of Directors Serving Members of the Board of Directors receive fixed compensation. The Members of the Board of Directors receive annual compensation for the services they perform. This covers the period between two Annual General Meetings of Shareholders. Based on the market analysis mentioned above, the amount of compensation for each function (Chairman, Vice Chairman, Member) and for committee work is set out in the above-mentioned regulation. In addition, Members of the Board of Directors receive a payment for each meeting they attend, this is also governed by the regulation. Two thirds of the compensation paid to Members of the Board of Directors is paid in cash and a third in the form of shares, except in the case of one Member of the Board who is paid exclusively in cash. The shares are blocked for a period of three years. Executive Committee The remuneration of Members of the Executive Committee is paid in two parts, one in cash, and the other in shares. The shares are paid out at the beginning of the next year and are blocked for three years. The amount paid in cash includes a fixed component (paid every month) and a variable component (around 20% of overall remuneration). The part paid in shares is fixed (around 25% of overall remuneration). The variable component of the cash remuneration depends on the attainment of financial targets set by the Board of Directors. These targets are determined on the basis of the annual budget and are made up as follows: a) 50% determined by achieving the budgeted EBITDA b) 50% determined by achieving the budgeted invested capital.
The Nomination and Remuneration Committee determines whether the targets have been achieved once the annual results are available. The variable part of cash remuneration is paid if the targets are reached. Exceeding one or both of the targets leads to a proportional increase in the variable amount (up to a maximum of 200% of this component); conversely, failure to reach the target leads to a proportional reduction (down to zero) of this variable component. In December, the Board of Directors, in response to a proposal by the Nomination and Remuneration Committee, determines the fixed portion of the remuneration paid to the Executive Committee for the following year. The Nomination and Remuneration Committee drafts a proposal on the amount to be paid to each Member of the Executive Committee, which is analysed and ratified by the Board of Directors. As well as the market situation, as mentioned above, function, performance, experience and effort are taken into account. Discretion is used in the weighting of these criteria. The modalities applying to the CEO’s compensation are based on the same principles as used for the other Members of the Executive Committee.
150–151
Corporate Governance
6.1.2 No exceptions were granted during the year under review.
The compensation paid to the former CEO Hanspeter Fässler was based on the same principles too, but also included a variable element in the form of shares. Also, the fixed share element was paid to him every quarter rather than once a year. The variable part was determined according to the criteria outlined above. There is a three-year blocking period for both the fixed and variable share component. On leaving the Implenia Group, the former CEO received a severance payment in the form of a limited continuation of salary. This continuation of salary is much smaller than originally agreed in the employment contract. Employees of Implenia companies and Implenia pension foundation based in Switzerland can participate in a share option plan. Under this share option programme employees, including Members of the Executive Committee10, had an opportunity each spring and autumn to buy Implenia Ltd. registered shares on preferential terms (currently at a discount of 30% to the average stock market price for the month in question). In each calendar year, Members of the Executive Committee could buy shares worth up to their gross monthly salary. Purchased shares are blocked for a period of three years. The share option programme was approved by the Board of Directors; Members of the Board are not entitled to participate. The programme and its conditions are periodically reviewed by the Executive Committee and may be altered at any time. Changes affecting Members of the Executive Committee have to be approved by the Board of Directors. Additional information on compensation pursuant to Art. 663b SCO can be found in the notes to the financial statements on pages 252 – 257 of the financial report. 6. Shareholders’ participation 6.1 Voting rights and representation restrictions
6.1.1 Voting rights may be refused (i) to shareholders who, when requested to do so by the company, do not expressly declare that they acquired and hold the shares in their own name and for their own account or, if acting as nominees, they do not declare in writing that they are prepared to reveal the names, addresses and number of shares held of the persons for whom they hold the shares, or if they do not immediately disclose this information on first request (Art. 7 Para. 4a of Implenia Ltd.’s articles of association), (ii) if the recognition of a purchaser as a shareholder may prevent the company from providing the proof required by law concerning the composition of its body of shareholders (Art. 7 Para. 4b of Implenia Ltd.’s articles of association). As mentioned above, the Board of Directors may also reach agreements with nominees about their disclosure obligations (see section 2.6 above and www.implenia.com in the section “Investor Relations” – “Regulations”). 10 The relevant regulation was changed recently. Members of the Executive Committee are no longer entitled to benefit from the share option plan.
6.1.3 The above restrictions on voting rights prescribed by the articles of association can be removed by changing the articles of association, which requires a resolution of the General Meeting of Shareholders approved by at least two thirds of the votes represented (Art. 16 of the articles of association of Implenia Ltd.). 6.1.4 In accordance with Art. 13 Paras. 3-5 of the articles of association, a shareholder may be represented at the General Meeting of Shareholders by another shareholder with voting rights, using the power of attorney attached to the admission card, or by its legal representatives. Company representatives and depository proxies as well as independent proxies designated by the company do not have to be shareholders of the company. Minors and persons in guardianship may be represented by their legal representative, married persons by their spouse and legal entities by an authorised signatory or by another authorised representative; this applies even if such representatives are not shareholders of the company. The chairperson of the General Meeting of Shareholders shall decide on the admissibility of a representative. 6.2 Statutory quorums The General Meeting of Shareholders makes its resolutions by the majorities stipulated by law. The articles of association do not stipulate any different majorities, except for the one needed for the removal or simplification of the restriction on the transferability of shares, which requires a resolution of the General Meeting of Shareholders approved by at least two thirds of the votes represented (Art. 16 of the articles of association of Implenia Ltd.). Resolutions about mergers, demergers and transformations are governed by the provisions of the Swiss Mergers Act. 6.3 Convocation of the General Meeting of Shareholders The General Meeting of Shareholders is convened by notice published in the Swiss Official Gazette of Commerce. Holders of registered shares may also be informed in writing (Art. 11 of the articles of association of Implenia Ltd.). The Board of Directors decides on the location of the General Meeting of Shareholders. 6.4 Inclusion of item on the agenda Shareholders who together represent shares with a par value of at least CHF 1,000,000 may request that an item appear on the agenda. Such requests must be received in writing by the company at least 45 days before the General Meeting of Shareholders. 6.5 Inscriptions into the Share Register Shareholders who are entered with voting rights in the Share Register at 12 noon on 8 March 2012 shall be sent an invitation to the General Meeting of Shareholders. Shareholders who are entered in the Share Register after this but before 23 March 2012, shall be sent the invitation when they are entered in the Share Register. No entries with voting rights will be made in the Share Register from 23 March 2012 up to and including 4 April 2012. The cut-off date for acquiring the right to vote at the General Meeting of Shareholders is 22 March 2012, 5 p.m.
152–153
Corporate Governance
7. Changes of control and defence measures 7.1 Duty to make an offer Implenia Ltd.’s articles of association contain no “opting out” or “opting up” clauses. 7.2 Clauses on changes of control No agreements relating to change of control have been made with the Members of the Board of Directors, the Members of the Executive Committee or other executives.
8. Auditing body 8.1 Duration of the mandate and term of office of the lead auditor Since 2006 the auditor has been PricewaterhouseCoopers AG (Zurich). The duration of the auditing mandate given to PricewaterhouseCoopers AG is one year. This began on 19 April 2011. The lead auditor, Willy Wenger, has been responsible for the audit mandate since 2 March 2006. The lead auditor’s mandate must not be for a term of more than seven years. 8.2 Auditing fees During the year under review, total fees invoiced by the auditing company came to CHF 1,174,788. 8.3 Additional fees Total additional fees for the current financial year come to CHF 309,866. These fees were paid for consultancy services rendered in relation to due diligence work (CHF 171,716) and tax consulting (CHF 138,150). 8.4 Informational instruments pertaining to an external audit The main task of the Audit Committee is regularly and effectively to monitor the auditor’s reporting to ensure its quality, integrity and transparency. Representatives of the auditors attended parts of all three meetings of the Audit Committee during the financial year. The auditing schedule, including fees, is presented to and discussed with the members of the Audit Committee. The auditor presents any important observations in writing to the Audit Committee together with appropriate recommendations.
9. Information policy Implenia follows an open and transparent information policy. The most important information is communicated regularly as follows: – Annual results: February / March (publication of the annual report, press conference and analysts’ event) – Half-year results: August / September (publication of the half-year report, press conference and analysts’ event) – General Meeting of Shareholders: March / April
For further information we refer interested parties to our press releases and our letters to shareholders, to the Swiss Official Gazette of Commerce, as well as to our website (www.implenia.com), where important information for investors is available under the links “Investor Relations” and “Media”. Investors can also register to receive important information by e-mail by following the “Media”-“News Service” link. General information is available from the following contact address: Philipp Bircher Implenia Management Ltd. Industriestrasse 24 CH-8305 Dietlikon Telephone + 41 (0)44 805 45 23 Fax + 41 (0)44 805 45 20 E-mail philipp.bircher@implenia.com
Financial Report
154–155
Consolidated financial statements of the Implenia Group – Consolidated income statements 156– Consolidated statements of comprehensive income 157– Consolidated balance sheets 158 – Consolidated statements of changes in equity 160 – Consolidated cash flow statements 162 – Notes to the consolidated financial statements of Implenia 164 – Report of the statutory auditor on the consolidated financial statements 246 – Statutory financial statements of Implenia AG – Income statements 248 – Balance sheets 249 Notes to the statutory financial statements 250 – Report of the statutory auditor on the financial statements 260
156–157
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Consolidated income statements
Consolidated statements of comprehensive income
1.1. – 31.12. 2011 Notes
CHF 1,000
1.1. – 31.12. 2011
1.1. – 31.12. 2010 CHF 1,000
Notes
Consolidated revenue
5
2,522,646
2,388,418
Materials and sub-contractors
6
(1,565,867)
(1,480,942)
Personnel expenses
7
(671,181)
(655,035)
Shareholders of Implenia AG
Other operating expenses
9
(150,182)
(147,030)
Non-controlling interests
(46,813)
(34,894)
Depreciation and amortisation Income from associates Operating income
5
5,073
7,141
93,676
77,658
Financial expenses
10
(15,827)
Financial income
10
3,805
4,174
81,654
68,041
(20,303)
(15,583)
61,351
52,458
Profit before tax Tax
11
Consolidated profit
(13,791)
Consolidated profit
Fair value adjustments on financial instruments
23
Non-controlling interests
60,264
51,470
1,087
988
Consolidated earnings per share (CHF) Basic earnings per share
30
3.31
2.88
Diluted earnings per share
30
3.31
2.88
The accompanying notes form part of the consolidated financial statements.
CHF 1,000
61,351
52,458
(401)
(11,464)
260
–
144
3,262
Income tax on fair value adjustments on financial instruments
(31)
(518)
Other comprehensive income
(28)
(8,720)
61,323
43,738
59,976
42,750
1,347
988
Total comprehensive income Attributable to: Shareholders of Implenia AG
Shareholders of Implenia AG
CHF 1,000
Foreign exchange differences attributable to:
Non-controlling interests
Attributable to:
1.1. – 31.12. 2010
The accompanying notes form part of the consolidated financial statements.
158â&#x20AC;&#x201C;159
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Consolidated balance sheets
31.12.2011
31.12.2010
Notes
CHF 1,000
CHF 1,000
ASSETS
EQUITY AND LIABILITIES Notes
Cash and cash equivalents
12
402,532
349,274
Marketable securities
13
516
346
Trade receivables
14
472,789
395,234
Work in progress
Work in progress
15
220,098
228,891
Joint ventures
Joint ventures
16
33,552
23,770
Other receivables
17
45,285
Raw materials
18
Real estate transactions
19
Prepaid expenses and accrued income Total current assets
CHF 1,000
3,795
1,605 217,347
15
555,083
499,204
16
49,341
44,218
Other liabilities
55,782
44,577
39,989
Tax liabilities
30,018
18,495
23,398
21,843
Prepaid income and accrued expenses
75,151
70,867
247,047
217,983
24,421
24,157
1,469,638
1,301,487
Financial liabilities
225,365
221,053
Investment property
21
18,860
7,732
Investments in associates
22
47,169
Other financial assets
23
9,764
Pension assets
27
25,519
12,411
Intangible assets
24
90,674
73,323
Deferred tax assets
28
714
1,610
418,065
375,516
25
Trade payables
Provisions
26
Total current liabilities Financial liabilities
20
25
Other liabilities Deferred tax liabilities
28
42,675
Provisions
26
16,712
Total non-current liabilities
1,887,703
1,677,003
5,892
8,873
1,047,599
905,186
205,278
198,155
7,295
â&#x20AC;&#x201C;
57,742
47,950
26,261
30,228
296,576
276,333
Share capital
29
35,097
51,722
Treasury shares
29
(4,460)
(6,292)
441,974
392,094
Reserves Consolidated profit attributable to shareholders
Total assets
31.12.2010
CHF 1,000
272,537
Property, plant and equipment
Total non-current assets
31.12.2011
Equity attributable to shareholders Non-controlling interests Total equity Total equity and liabilities The accompanying notes form part of the consolidated financial statements.
60,264
51,470
532,875
488,994
10,653
6,490
543,528
495,484
1,887,703
1,677,003
160–161
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Consolidated statements of changes in equity
Reserves
Notes
Equity as at 1.1.2011
Foreign exchange differences
Retained earnings
Total shareholders’ equity
Non-controlling interests
Total equity
CHF 1,000
CHF 1,000
Share capital
Treasury shares
Capital reserves
Revaluation reserve
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
51,722
(6,292)
132,813
5,650
(15,766)
320,867
488,994
6,490
495,484
Total comprehensive income
–
–
–
113
(401)
60,264
59,976
1,347
61,323
Dividends
–
–
–
–
–
–
–
(383)
(383)
(16,625)
232
–
–
–
–
(16,393)
–
(16,393)
Par value repayment
31
Change in treasury shares
–
1,600
(1,302)
–
–
(1,788)
(1,490)
–
(1,490)
Share-based payments
–
–
–
–
–
1,788
1,788
–
1,788
Change in non-controlling interests
–
–
–
–
–
–
–
482
482
Change in scope of consolidation
–
–
–
–
–
–
–
2,717
2,717
Total other changes in equity
(16,625)
1,832
(1,302)
–
–
–
(16,095)
2,816
(13,279)
Total equity as at 31.12.2011
35,097
(4,460)
131,511
5,763
(16,167)
381,131
532,875
10,653
543,528
Equity as at 1.1.2010
64,652
(38,890)
127,120
2,906
(4,302)
268,951
420,437
5,903
426,340
Total comprehensive income
–
–
–
2,744
(11,464)
51,470
42,750
988
43,738
Dividends
–
–
–
–
–
–
–
(396)
(396)
(12,930)
396
–
–
–
–
(12,534)
–
(12,534)
Par value repayment
31
Change in treasury shares1
–
32,202
5,693
–
–
(3,433)
34,462
–
34,462
Share-based payments
–
–
–
–
–
3,433
3,433
–
3,433
Change in non-controlling interests
–
–
–
–
–
–
–
(5)
(5)
Change in scope of consolidation
–
–
–
–
–
446
446
–
446
Total other changes in equity
(12,930)
32,598
5,693
–
–
446
25,807
(401)
25,406
Total equity as at 31.12.2010
51,722
(6,292)
132,813
5,650
(15,766)
320,867
488,994
6,490
495,484
1 In 2010, a large proportion of treasury shares was sold to various investors.
The accompanying notes form part of the consolidated financial statements.
162–163
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Consolidated cash flow statements
1.1. – 31.12. 2011
1.1. – 31.12. 2011
1.1. – 31.12. 2010
Notes
CHF 1,000
61,351
52,458
Increase of financial liabilities
2,157
630,223
Tax
11
20,303
15,583
Repayment of financial liabilities
(431)
(473,316)
Financial result
10
Consolidated profit
CHF 1,000
Notes
12,022
9,617
Depreciation and amortisation
46,813
34,894
Par value repayment
Profit on sale of non-current assets
(1,796)
(6,621)
Cash flow with non-controlling interests
Income and distribution from associates
(1,222)
(3,436)
Cash flow from financing activities
Change in provisions Change in pension assets
(7,243)
6,469
(13,108)
(7,234)
Change in cash and cash equivalents Cash and cash equivalents at beginning of the period
(52,416)
(8,821)
Cash and cash equivalents at end of the period
52,926
37,484
Change in net working capital Change in trade and other receivables Change in work in progress (net), raw materials Change in real estate transactions Change in trade payables and other liabilities Change in accruals and joint ventures Interest paid Interest received
(47,029)
54,103
44,687
(17,791)
886
(27,266)
(7,797)
(2,662)
671
2,013
(6,599)
(274)
Cash flow from operating activities
102,449
138,516
Investments in property, plant and equipment
(38,720)
(39,496)
Tax paid
Disposals of property, plant and equipment
13,104
7,910
Investments in other financial investments and associates
(7,553)
(6,447)
Disposals of other financial investments and associates
11,242
6,605
Acquisition of intangible assets
(1,042)
(24)
(12,169)
(67,144)
(35,138)
(98,596)
Acquisition of subsidiaries Cash flow from investing activities
2.3
Change in treasury shares 31
CHF 1,000
1.1. – 31.12. 2010 CHF 1,000
298
37,894
(16,393)
(12,533)
99
(396)
(14,270)
181,872
217
(1,267)
53,258
220,525
12
349,274
128,749
12
402,532
349,274
Foreign exchange differences on cash and cash equivalents
The accompanying notes form part of the consolidated financial statements.
164–165
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
1
General information
Implenia AG is a Swiss public limited company incorporated in Dietlikon, Zurich. The shares of Implenia AG are listed on the SIX Swiss Exchange (ISIN code CH002 386 8554, IMPN). The German version of the financial statements is the original version. The English and French versions are non-binding translations. Implenia’s business activities are described in Note 2.4. The consolidated report as at 31 December 2011 was approved by the Board of Directors of Implenia AG on 5 March 2012, for submission to the General Meeting. In accordance with Art. 698 of the Swiss Code of Obligations [SCO], the General Meeting must approve the consolidated financial statements. The consolidated financial statements are audited by the statutory auditor PricewaterhouseCoopers AG, Zurich. Unless otherwise stated, the figures in the annual report are given in thousands of Swiss francs.
2
Summary of significant accounting policies
The consolidated financial statements of Implenia have been prepared in accordance with International Financial Reporting Standards (IFRS) as published by the International Accounting Standards Board (IASB). With the exception of balance sheet items measured at fair value, the consolidated financial statements are based on historical cost. Management estimates and judgements for the purposes of financial reporting affect the values of reported assets and liabilities, contingent liabilities and assets on the balance sheet date, and expenses and income during the reporting period. Actual values may differ from these estimates.
2.1 Changes in accounting policies With the exception of the following standards, revisions and interpretations of standards that were applied for the first time as of the financial year beginning 1 January 2011, the accounting principles applied in the 2011 consolidated annual financial statements are identical to those published and described in the 2010 annual report.
– – – – –
Annual Improvements 2010 IAS 24 Related Party Disclosures (Revised) IAS 32 Financial Instruments: Presentation (Amendment about Classification of Rights Issues) IFRIC 14 IAS 19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments
The International Accounting Standards Board (IASB) has published the following new standards. Application of these standards is not mandatory in the 2011 financial year. It has been decided not to apply the standards prematurely. – Annual Improvements 2011 – IAS 1 Presentation of Financial Statements (Amendment) – IAS 19 Employee Benefits (Amendment) – IAS 27 Consolidated and Separate Financial Statements (Revised) – IAS 28 Investments in Associates (Revised) – IFRS 7 Financial Instruments: Disclosures (Amendment) – IFRS 9 Financial Instruments – IFRS 10 Consolidated Financial Statements – IFRS 11 Joint Arrangements – IFRS 12 Disclosure of Interests in Other Entities – IFRS 13 Fair Value Measurement The amendment to IAS 19, which is effective from 1 January 2013, is relevant to Implenia. Actuarial gains and losses will now be recognised in other comprehensive income in the period in which they occur. The corridor method, which is applied today and described in Note 2.8, will no longer be permitted. Current service costs and net interest will be recognised in the income statement. Net interest is calculated based on the discounted net defined benefit liability (asset) and replaces the expected return on plan assets and the interest cost on the defined benefit obligation. On first-time adoption, the existing unrecognised actuarial gains and losses will be recognised as pension asset or obligation directly in equity and excluded from profit or loss. The Group is currently considering adoption impacts and options.
2.2 Principles of consolidation The consolidated financial statements of Implenia include the financial statements of Swiss-domiciled Implenia AG and its subsidiaries as of 31 December 2011. Subsidiaries are companies directly or indirectly controlled by Implenia AG. Control is defined as the ability to control the financial and operating activities so as to obtain benefits from them. This is usually the case where Implenia directly or indirectly controls more than 50% of the company’s voting rights or potential voting rights that can be exercised at any given time. Companies acquired during the year under review are included in the consolidated accounts from the date on which the Group obtains control over their operating activities, and all companies sold during the year under review are included up to the date on which control passes to the buyer. Receivables, liabilities, transactions and unrealised gains between Group entities are completely eliminated from the consolidated accounts. Changes in ownership interests in subsidiaries that do not result in a change in control are recognised as a transaction in equity.
166–167
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
Business combinations in which the Group assumes control over another company are accounted for using the purchase method. The purchase price is calculated as the sum of the fair values of the assets transferred to the seller and the liabilities incurred or assumed at the time of the transaction. IFRS requires agreed adjustments in acquisition-related costs dependent on future events to be recognised in the purchase price and any interests already held in an acquired business to be remeasured at fair value and recognised in the income statement. Transaction costs are recognised as expenses in the period in which they are incurred. Identifiable assets, liabilities and contingent liabilities acquired are recognised in the balance sheet at their acquisition-date fair value, irrespective of the size of the minority interests. Acquisition costs exceeding the Group’s share of the fair value of the identifiable net assets are recognised as goodwill. Investments in associates (defined as companies in which Implenia holds 20–50% of the voting rights or over which Implenia can otherwise exercise significant influence) are accounted for under the equity method.
2.3 Material changes in the scope of consolidation The following acquisition was made in 2011. Acquisition of Betonmast Anlegg AS, Oslo (Norway): With effect from 18 July 2011, Implenia acquired 80.79% of the outstanding shares of Betonmast Anlegg AS. Betonmast Anlegg AS and its subsidiaries are specialists in tunnel and infrastructure construction in Norway. In line with the Group’s strategy, this acquisition strengthens Implenia’s position in the international tunnel construction business and generates sustainable growth in abroad. Betonmast Anlegg AS has been fully consolidated since the date of acquisition. CHF 19.8 million of the purchase price of CHF 26.4 million was paid on the date of acquisition. Depending on the returns generated by contractually agreed projects, the original purchase price might be reduced. In addition, an earn-out clause has been defined on the basis of order intake for the years 2011, 2012 and 2013, which will result in future performance-related purchase price outflows. The additional payments could range from a minimum of CHF 0 to a maximum of CHF 8.4 million. The present value of the maximum commitment of CHF 6.6 million has been recognised in other non-current liabilities, with interest accruing until the earn-out payment date. Based on the business plan of the Betonmast Anlegg Group, no purchase price reduction is expected and the maximum earn-out payment is likely. Based on the final purchase price allocation, the identifiable net assets amount to CHF 10.7 million (of which CHF 7.7 million are cash and cash equivalents). The goodwill from the transaction amounts to CHF 15.7 million, and reflects the non-capitalisable assets acquired such as market entry, customer relations in the public sector and the assembled workforce. Transaction costs amount to CHF 0.3 million. The Betonmast Anlegg Group generated a net income for the year 2011 of CHF -0.5 million and consolidated revenue of CHF 121.4 million. For the period of 18 July to 31 December 2011, the net income of the Betonmast Anlegg Group stood at CHF -0.9 million and consolidated revenue at CHF 75.7 million. Both net income figures include CHF 2.7 million for the amortisation of acquired intangible assets.
The Betonmast Anlegg Group has been assigned to the Industrial Construction segment. In 2010, the following acquisitions were made. Acquisition of Russian Land Implenia Holding Ltd., Nicosia (CY): After the joint venture in Russia was dissolved, Implenia acquired the shares of the partner (50% of Russian Land Implenia Holding Ltd., Nicosia (CY)) on 13 April 2010 for a purchase price of TCHF 0. No material transaction costs arose. As Implenia held 100% of the shares of Russian Land Implenia Holding Ltd., Nicosia (CY), and Russian Land Implenia Ltd., Moscow (RU), both companies were fully consolidated. Russian Land Implenia Holding Ltd., Nicosia (CY) has been assigned to the Industrial Construction segment. Acquisition of Sulzer Immobilien AG, Winterthur (CH): On 31 August 2010, Implenia announced the acquisition of Sulzer Immobilien AG, Winterthur (CH). On 27 October 2010, it was announced that the Swiss Competition Commission had approved the purchase. As a result, Implenia holds 100% of the share capital of Sulzer Immobilien AG, Winterthur (CH) including its real estate, land and development properties in the industrial and central areas of the city centre of Winterthur and in Oberwinterthur. This company was therefore fully consolidated on 27 October 2010. The purchase price for the acquisition of all the shares amounts to CHF 83.2 million, and was paid on 27 October and 10 November 2010. Based on the final purchase price allocation, the identifiable net asset values of Sulzer Immobilien AG, Winterthur (CH) stood at CHF 83.2 million (of which CHF 16 million were cash and cash equivalents). No goodwill arose as a result of the transaction. The transaction costs came to CHF 1.8 million (which were recognised under “Other operating expenses”). In the financial year from 1 January to 31 December 2010, Sulzer Immobilien AG generated net income of CHF 22.9 million and consolidated revenue of CHF 15.8 million. Sulzer Immobilien AG was fully consolidated on 27 October 2010. For the period from 27 October to 31 December 2010, Sulzer Immobilien AG generated net income of CHF 1.3 million and consolidated revenue of CHF 2.3 million. Sulzer Immobilien AG, Winterthur (CH) has been assigned to the Real Estate (Project Development) segment. Through the purchase of Sulzer Immobilien AG, Winterthur, Implenia also acquired a portfolio of real estate in the amount of CHF 65 million for which sales contracts already exist. These will be completed by the acquiree, Sulzer Immobilien AG, but will have no effect on the liquidity or income statement of Implenia. The purchase price of CHF 65 million for the real estate is due on completion (when the Swiss land registry office issues notification that the real estate purchase contracts have been entered in the land register). At the same time, Implenia will be compensated in the amount of the purchase price by the third-party purchaser of the real estate. After receipt of the money, payment will be made to the Sulzer Group. The value of these properties has therefore been offset against the outstanding liabilities. At the end of 2011, all of the sales contracts existing at the acquisition date had been completed.
168–169
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
The following statement of identifiable net assets acquired reflects the acquisition of the Norwegian Betonmast Anlegg Group for 2011, and the acquisitions of Russian Land Implenia Holding Ltd., Nicosia (CY) and Sulzer Immobilien AG, Winterthur (CH) for 2010.
Cash and cash equivalents Trade receivables Real estate transactions Other current assets Property, plant and equipment Intangible assets
2011
2010
CHF 1,000
CHF 1,000
7,678
16,050
31,006
–
–
110,178
1,590
4,126
11,308
–
5,270
–
121
1,856
Trade payables
(10,148)
(1,440)
Work in progress, liabilities
(11,738)
–
(332)
(22,219)
Other non-current assets
Current and non-current provisions
(11,599)
(9,947)
Other non-current liabilities
(9,731)
(15,120)
Fair value identifiable net assets
13,425
83,484
Non-controlling interests
(2,717)
–
Fair value net assets acquired – Implenia share
10,708
83,484
Goodwill
15,748
–
Purchase price consideration
26,456
83,484
–
(290)
(6,609)
–
Other current liabilities
Fair value of existing shareholding Deferred payment Purchase price paid
19,847
83,194
Cash and cash equivalents acquired
(7,678)
(16,050)
Net cash outflow
12,169
67,144
2.4 Segment reporting The Group’s segments are defined on the basis of the organisational units for which the Group’s Board of Directors receives reports. Significant Group companies and the segments to which they are assigned are listed in Note 37. The Group comprises the following segments:
2.4.1 Real Estate The Real Estate segment comprises General Contracting / Services and Project Development. As a full service provider, the Real Estate segment covers all stages of the real estate lifecycle from development and realisation, right through to operational optimisation and promotion.
2.4.1.1 General Contracting / Services This segment includes activities such as coordinating, engineering and planning real estate projects, carrying out building work as a general and total contractor, and overseeing technical facility management.
2.4.1.2 Project Development This segment comprises activities such as designing and preparing real estate projects. It transforms visions and ideas into long-term real estate projects and provides additional services in the area of property management.
2.4.2 Infrastructure Construction This segment is active in all areas of traditional construction. These include road building and foundation projects, infrastructure facilities and civil engineering, concrete restoration, bridge and avalanche protection construction, foundation construction, building projects (new and renovations), and gravel processing and surfacing works.
2.4.3 Industrial Construction 2.4.3.1 Tunnelling This segment is primarily concerned with realising complex construction projects in Switzerland and abroad as a builder and total contractor. Among the services provided are microtunnelling, underground engineering, the construction of power plants in the mountains and along rivers, and railway technology.
2.4.3.2 Prime Buildings This segment is responsible for consultative and project construction management on sophisticated real estate projects abroad.
170–171
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
2.4.4 Miscellaneous / Holding This area contains any costs of Implenia that cannot be allocated to a segment. These include Group companies with no activities, holding company overheads, deferred taxes recognised at Group level and pension assets or obligations. The segments each have their own management structures and internal reporting systems and are therefore classed and reported as separate operating segments. Certain headquarter functions are disclosed under Miscellaneous / Holding. These include procurement, financing & controlling, human resources, IT, investment management, marketing / communication, legal services and insurance.
2.4.5 Notes on the segment reporting Transfer pricing between the operating segments is based on the arm’s-length principle. The reported operating assets and liabilities of the reporting segments comprise property, plant and equipment, intangible assets, trade receivables and payables, inventories, and other assets and other liabilities such as provisions which can be allocated to the reporting segments. Assets and liabilities not allocated to the segments mainly comprise current and deferred tax assets and liabilities, as well as pension assets and liabilities.
2.6 Foreign currencies The consolidated financial statements of Implenia are denominated in Swiss francs (CHF). The functional currencies of the Group companies abroad are the respective local currencies. In the subsidiaries, foreign currency transactions are measured at the exchange rate prevailing on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate prevailing on the balance sheet date. All foreign exchange differences are recognised in the income statements of the respective companies. Income, expenses and cash flows of the consolidated companies are translated to CHF at the average rate for the reporting period. Balance sheet items are translated at the closing rate. Exchange differences relating to equity positions and non-current intra-group financing transactions in connection with net investments in foreign subsidiaries are recognised directly within the exchange differences in other comprehensive income. These cumulative amounts of currency gains and losses recognised in equity are reclassified to the income statement upon deconsolidation.
2.7 Revenue The Board of Directors exercises the role of chief operating decision maker as defined in IFRS 8. The Board regularly receives internal reports in order to assess the performance of the Group and review the allocation of resources within the Group. The chief operating decision maker receives segment information in the same level of detail as that presented in the segment reporting.
2.5 Related parties These comprise joint ventures, associates and other related parties. Please refer to the relevant sections for information on joint ventures and associates. Other related parties mainly comprise officers and directors of Implenia (key management personnel), their related parties and the companies at which these persons exercise a senior management function. Significant influence exists in particular where a person exercises a senior management function at another company as a member of the Board of Directors or the Executive Committee and explicitly, i.e. as part of his contractual duties, represents the interests of Implenia or acts as a representative of Implenia. Significant influence is otherwise assumed if one or more senior managers at Implenia can use their (senior) management position at the other company to exert a direct influence on the conditions applying to actual transactions with Implenia (e.g. contractual terms, prices, etc.). This is the case, for example, if Implenia or the senior management member also has a significant equity interest in the other company or if the other company conducts significant transactions with Implenia. Other types of arrangement may also lead to significant influence being exercised. The officers and directors of Implenia comprise the members of the Board of Directors and the members of the Executive Committee of Implenia.
Consolidated revenue includes all income from the different activities of Implenia. In General Contracting and Construction Works, customer contracts are recognised in accordance with the percentage-of-completion method. Revenue, including share of profits, is recognised on the basis of the proportion of the total service to be performed that is actually performed in the financial year. Future expected losses from contracts are taken into consideration when measuring the value of contracts and provided for immediately. Price overruns, additional services and share of profit are recognised in proportion to the stage of completion. For joint venture contracts, only the service actually performed by the company in the joint venture and its share of the profits of the joint venture are recognised as revenue. Revenue under “Services” is calculated on the basis of the proportion of the service actually provided to the customer up to the balance sheet date. IFRIC 15 provides guidance for determining whether an agreement for the construction of real estate falls within the scope of IAS 11 Construction Contracts or of IAS 18 Revenue and, therefore, when revenues from construction work should be recognised. An agreement for the construction of real estate is deemed to be a construction contract falling within the scope of IAS 11 only if the buyer is able to specify the major elements prior to the start of construction work and / or amend the major elements after construction work has started (irrespective of whether the buyer exercises that ability). If the purchaser has this ability, IAS 11 must be applied, otherwise IAS 18 has to be applied.
172â&#x20AC;&#x201C;173
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
For the Project Development segment, revenue includes income from the sale of real estate and total contracting work, as well as temporary rental income (in expectation of the sale of the property). Income from the sale is recognised when the risks and rewards are transferred, i.e. at the time title is transferred, which is normally upon entry in the official land register. Reductions in income, such as rebates or discounts directly related to the services charged, are deducted from revenue.
2.10 Tax
Pension arrangements are shown as defined contribution plans if the Group pays fixed contributions to a separate fund or external financial institution and has no legal or constructive obligations to make any further contributions. All other pension arrangements are treated as defined benefit plans, even if the Groupâ&#x20AC;&#x2122;s potential obligations are small or the probability of occurrence is low. Consequently, most Group pension arrangements are classified as defined benefit plans, since the corresponding legal or constructive obligations apply in Switzerland.
Income taxes are recognised in the same period as the income and expenses to which they relate. Deferred taxes are recognised in accordance with the balance sheet liability method. The computation is therefore based on the temporary differences between the tax base and the carrying amount relevant for consolidation of an asset or a liability, unless the temporary difference relates to investments in Group companies where the timing of the reversal of the difference can be controlled and it is probable that this will not take place in the foreseeable future. In addition, where no provision has been made for distributions of profits, withholding taxes and other taxes on potential later distributions are not recognised as profits are normally reinvested. Deferred tax assets and deferred tax liabilities of the Group, computed on the basis of the local tax rates expected to apply at the time of taxation, are recognised under non-current assets and non-current liabilities. Changes in deferred tax assets and deferred tax liabilities are recognised in the income statement or in the statement of comprehensive income, if they relate to items that are recognised in the statement of comprehensive income. Deferred tax assets are recognised for all unused tax loss carryforwards to the extent that it is probable that these can be offset against future taxable profits.
Pension liabilities under defined benefit plans are calculated annually by independent actuaries using the projected unit credit method. They correspond to the present value of future expected payments arising from current and past periods of service. The plan assets are recognised at fair value. Unvested past service costs arising from changes in the pension plans, including any amounts in relation to employees in retirement, are recognised immediately in the income statement.
Several Swiss cantons levy a separate tax on the sale of land and real estate from business assets that is usually deductible from the ordinary cantonal taxes on profits. The taxable gains on the sale of property are calculated in accordance with the applicable cantonal laws. The applicable tax rate on the sale of property is dependent on the length of ownership and the size of the taxable gain on the sale of the property. The immovable property gains tax is calculated as at the date of sale.
The effect of changes in actuarial assumptions and experience adjustments on the values of assets and liabilities from defined benefit plans are recognised in the income statement using the corridor method in accorÂdance with IAS 19.
2.11 Cash and cash equivalents
The amount recognised in the balance sheet as pension assets equals the deficit of the underfunded defined benefit plans adjusted for unrecognised actuarial gains and losses.
Cash and cash equivalents comprise cash on hand and cash at banks, Swiss Post and other financial institutions. Positions are recognised as cash only if they are readily convertible to known amounts of cash, if they are not subject to a significant risk of change in value and if they have a maturity of no more than three months. This definition of cash and cash equivalents is also applied for the purpose of the consolidated cash flow statements.
2.8 Pension plans
2.9 Share-based payments The payments under share-based compensation (the difference between the market value of the shares distributed and the sales proceeds) are reported as personnel expenses. Costs in relation to shares that are not distributed until the following year are recognised fully in the year in which service is rendered, as they are not contingent on future performance. The arrangements are agreed each year by the Board of Directors. All the employees benefit from an employee profit-sharing plan as defined in the regulations. Under this plan, employees are able to acquire a set number of Implenia AG shares at a preferential rate, twice a year in accordance with the regulations.
2.12 Trade receivables Trade receivables are recognised at fair value, that is, at the amounts invoiced less allowances for estimated shortfalls in receipts, e.g. due to rebates, refunds and discounts. Allowances for doubtful receivables are computed on the basis of the difference between the recognised value of the receivable and its estimated collectible net amount. Any expected loss is charged to the income statement. If a receivable is uncollectible, it is written off.
174â&#x20AC;&#x201C;175
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
2.13 Work in progress Customer contracts relating to construction sites are accounted for using the percentage-of-completion method. The percentage of completion is ascertained on the basis of the work completed under the respective contracts. After offsetting prepayments by customers, the customer contracts are reported in the balance sheet as net assets or net liabilities from work in progress. If the outcome of a construction contract cannot be estimated reliably, revenue is recognised only to the extent of the contract costs incurred that will probably be recoverable, while the contract costs incurred are also recognised as an expense in the same period. This is equivalent to measurement at cost of production. If it is probable that the total contract costs will exceed the total contract revenues, the expected loss is recognised immediately as an expense.
On acquisition of an investment in an associate, goodwill may arise. Goodwill is the excess of the acquisition costs over the Groupâ&#x20AC;&#x2122;s share of the fair value of the identifiable net assets acquired. This goodwill forms part of the carrying amount of investments in associates. The long-term joint ventures for the operation of facilities producing concrete and asphalt in which Implenia has interests of 20% and above are recognised and measured separately from the other joint ventures, which are also measured as associates in accordance with IAS 28 Investments in Associates. Income from associates is reported within operating income since their operating activities are for the purpose of executing customer contracts.
2.16 Raw materials 2.14 Joint ventures Joint ventures are established to implement short-term projects with other construction companies. Work is assumed when a joint agreement has been concluded with the contractual partners. Joint ventures are organised as simple partnerships; the partnership agreements govern the relationships between the members. Joint ventures are recognised using the equity method (in accordance with IAS 28 Investments in Associates) permitted under IAS 31 (Interests in Joint Ventures). Joint ventures are initially recognised at cost. Thereafter, the carrying amount increases or decreases in line with Impleniaâ&#x20AC;&#x2122;s share of the profit or loss of the joint venture. Liquidity contributions and disbursements increase or reduce the carrying amount of the interests in joint ventures. The resulting asset or liability is recognised in the balance sheet. The receivables and payables of Implenia in respect of the joint ventures are disclosed separately in the corresponding receivables and payables items. Income from joint ventures is reported within operating income since their operating activities are for the purpose of executing customer contracts.
Raw materials are measured at cost. The valuation of inventory and charges to material costs are stated at historical cost in accordance with the average cost principle. Inventories that can only be sold with difficulty or at lower market prices must be written down. Inventories at a market price below the costs recognised by Implenia are written down if the finished product no longer covers the costs. If it is foreseeable that writtendown inventories can be used again, the write-downs are reversed by increasing the value of the inventory to the lower of net realisable value or historical cost. Unsellable inventories are written off in full.
2.17 Real estate transactions Real estate reported under this item is classified as held for sale and measured in accordance with IAS 2 Inventories. Completed properties not yet sold may temporarily generate rental income; however, they are still reported under this item, as they are held for sale. These properties are measured separately. Each property is measured at the lower of cost, including work by the company, or the net sale value. Costs includes financing costs paid to third parties until the construction is ready for use.
2.15 Investments in associates Associates are companies over which Implenia exercises significant influence but does not have control. As a rule, these are companies in which Implenia holds a stake of between 20% and 50%. These companies are accounted for using the equity method and are reported separately in the consolidated balance sheet. The equity participation is calculated on the basis of the statutory financial statements as at the closing date of the consolidated financial statements. If no statutory financial statements are available as at the closing date of the consolidated financial statements, measurement is on the basis of the last available statutory financial statements, taking into account any developments which have occurred in the meantime. The consolidation of associates is carried out in accordance with uniform group accounting and valuation principles.
Write-downs arising from impairments determined on the basis of the above measurement principles are charged directly to this item. Sales proceeds from real estate transactions are reported as revenue. Changes to the portfolio and movements in write-downs on real estate transactions are recognised in expenses. Certain real estate transactions are conducted jointly with one or more partners. Those properties under joint control and ownership are recognised as real estate transactions on a proportional basis.
176–177
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
2.18 Property, plant and equipment
2.19 Intangible assets
Property, plant and equipment is measured at cost and depreciated over its estimated useful life on a straight line basis, with the expense charged to the income statement: – Property 25–50 years – Plant 15–20 years – Machinery and vehicles 6–15 years – Furniture 5–10 years 3–5 years – IT 25–50 years – Investment property
2.19.1 Goodwill Business combinations are accounted for using the purchase method as described under Note 2.2. Goodwill is the excess of the costs of acquisition over the interest of the Group in the fair value of the net assets acquired. The non-controlling interests are recognised in proportion to their share of the fair value of the net assets acquired. Goodwill is not amortised, but is tested for impairment at each balance sheet date instead.
Additional costs that extend the economic benefits of property, plant and equipment are capitalised separately. Pro-rated financing costs for property, plant and equipment in construction are capitalised. The value of property, plant and equipment is reviewed whenever events or changes in circumstances indicate that the carrying amount may be impaired.
When testing goodwill for impairment, the realisable value is computed on the basis of the cash generating unit to which the goodwill is allocated. Realisable value is the higher of fair value less cost to sell and value in use. If the carrying amount exceeds the realisable value, the difference is recorded as an impairment. The estimates of future discounted cash flows, the corresponding discount rates and the growth rates are largely based on management estimates and assumptions. The actual cash flows and values generated may deviate significantly from the expected future cash flows and the related amounts determined using discounting methodology.
2.18.1 Investment property
2.19.2 Other intangible assets
Land and property held for the purposes of generating rental income or whose intended use has not yet been defined are recognised separately as investment property in accordance with IAS 40. All land is classified as investment property if no intention to develop or sell the land has been indicated. Recognition and measurement are carried out in accordance with the cost model (IAS 16). Investment property is recognised at cost and (in the case of real estate) depreciated on a straight line basis. If the present value of future net cash inflows is lower than the carrying amounts, the asset is written down to the lower recoverable value in accordance with IAS 36. The fair value of this real estate is shown separately, and is determined in accordance with recognised methods, for example, by using the current market price of comparable real estate as a basis or by applying the discounted cash flow method.
Additions of licences, software, IT development costs, brands and customer relationships are recognised at cost. Intangible assets are amortised on a straight line basis over their economic life from the initial date on which the Group can use them. The estimated economic life of intangible assets is regularly reviewed. All identifiable intangible assets (such as brands and customer relationships) acquired in the course of a business combination are initially recognised at fair value.
2.18.2 Finance leases Leased property, plant and equipment for which Implenia bears substantially all the risks and rewards associated with ownership are capitalised at the lower of the fair value of the leased property or the present value of the minimum lease payments at the inception of the lease and depreciated over the shorter of the lease term or the estimated useful life.
2.18.3 Operating leases Leases are classified as operating leases if a substantial proportion of the risks and rewards associated with ownership are retained by the lessor. They are generally depreciated on a straight line basis over the term of the lease, with the expense charged to the income statement.
Other intangible assets are measured at cost and amortised over their estimated useful life on a straight line basis, with the expense charged to the income statement: 3–5 years – Licences and software – Brands 3–5 years – Customer list 10–15 years
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
178–179
Notes to the consolidated financial statements of Implenia
2.20 Financial assets Financial assets are categorised as follows: “at fair value through profit or loss”, “available for sale”, “held to maturity” and “loans and receivables”. Financial instruments classified as “at fair value through profit or loss” are either “held for trading” or are designated as such on initial recognition. “Held for trading” financial assets are acquired principally with the objective of generating a profit from short-term fluctuations in price. Financial assets are designated as “at fair value through profit or loss” if this eliminates a measurement or recognition inconsistency and results in more relevant information. Financial assets “held to maturity” are securities with a fixed maturity that Implenia has the positive intention and ability to hold until maturity. “Loans and receivables” are financial assets that are issued by Implenia or acquired from the issuer on a primary market. These are non-derivative financial assets with fixed or determinable payments that are not quoted on an active market. All other financial assets are classed as “available for sale”. All financial assets are initially recognised at their fair value including transaction costs, with the exception of financial assets classified as “at fair value through profit or loss”, where the transaction costs are not included. All purchases and sales are recognised on the transaction date. After initial recognition, financial assets “at fair value through profit or loss” are measured at their fair value and all changes in fair value are reported in financial income or expense in the period to which they relate. After initial recognition, “held to maturity” financial assets and “loans and receivables” are measured at amortised cost using the effective interest method. After initial recognition, “available for sale” financial assets are stated at fair value and all unrealised changes are recognised in other comprehensive income, with the exception of interest which is calculated on the basis of the effective interest method, and foreign exchange fluctuations. In the event of the sale, impairment or disposal of “available for sale” financial assets, cumulative gains or losses recognised in equity since the date of acquisition are reported in financial income or expense for the current reporting period. Financial assets are tested for impairment on each balance sheet date. If there are objective indications of impairment such as insolvency, default or other major financial difficulties experienced by the issuer, an impairment is charged to the consolidated income statement. Financial assets are derecognised if the contractual interests in cash flows from the assets expire or the Group transfers the right to receive the cash flows from the financial assets in a transaction where all the significant risks and rewards of ownership of the financial asset are transferred.
The value of financial assets measured at amortised costs or at cost must be reviewed in the case of an indication of impairment. An impairment trigger exists, for example, if the fair value of the assets deteriorates to the extent that it must be assumed that this decrease is permanent. Neither assets and liabilities nor income and expenses are offset against each other if this is not required or permitted by a Standard or an Interpretation. Offsetting curtails the ability of users to understand transactions, other events or conditions and to estimate the future cash flows of a company unless it reflects the economic substance of a transaction, event or other condition. Measuring assets net of valuation allowances – for example, obsolescence allowances on inventories and doubtful debt allowances on receivables – is not offsetting. In accordance with IAS 18, revenue must be measured at the fair value of the consideration received or receivable, taking into account the amount of any trade discounts granted by the company. In the course of its ordinary business activities, the Implenia Group also conducts transactions that do not in themselves generate revenue but are incidental to the main revenue-generating activities. The results of such transactions are to be presented, if such presentation reflects the substance of the transaction or event, by netting any income with the related expenses arising from the same transaction: a) gains and losses on the disposal of non-current assets, including financial investments and operating assets, are recognised by deducting from the proceeds on disposal the carrying amount of the asset and related selling expenses; and b) expenditure related to a provision that is recognised in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets and reimbursed under a contractual arrangement with a third party (e.g. a supplier’s warranty agreement) may be netted against the related reimbursement. In addition, gains and losses arising from a group of similar transactions, for example, foreign exchange gains or losses or gains and losses arising on financial instruments “at fair value through profit or loss”, are reported on a net basis. However, these gains or losses are reported separately if they are material.
180â&#x20AC;&#x201C;181
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
2.21 Financial liabilities
2.23 Equity
Financial liabilities are initially recognised at cost and then at amortised cost. Any difference between the net proceeds received and the net amount repayable at maturity is amortised over the term of the instrument and charged to financial income or expense.
Equity represents the nominal value of the issued shares of Implenia AG.
Transaction costs paid to capital providers (generally banks) are amortised over the term of the underlying financial instrument using the amortised cost method.
2.22 Provisions Provisions are made if a legal or constructive obligation exists that makes it probable that an outflow of resources will be required to settle this obligation and a reliable estimate of the amount of the obligation can be made. Restructuring provisions are made if Implenia has a detailed formal plan for restructuring that it has either already started to implement or that it has announced to those affected by it. The provisions recognised are the best estimate of the final obligation. No provisions are made for future operating losses. Where there are a number of similar obligations, Implenia determines the probability that an outflow will be required by considering the class of obligations as a whole. Possible obligations whose occurrence cannot be assessed on the balance sheet date or obligations whose amount cannot be reliably estimated are disclosed as contingent liabilities. Where the effect of the time value of money is material, the present value of the expected expenditure is recognised.
Treasury shares represent shares of Implenia AG that have been reacquired on the market. They are deducted from equity. The revaluation reserve contains CHF 2.9 million arising from the merger between Zschokke and Batigroup. The foreign exchange differences arise from the measurement of the foreign subsidiaries. If these companies should cease to fall within the scope of consolidation, the corresponding share of the foreign exchange differences will be recycled through the income statement. Retained earnings represent the accumulated profits of the Group, most of which are freely available. Non-controlling interests represent the interests held by third-party shareholders in the equity (including profit for the year) of subsidiaries. Dividends and par value repayments are reported in the consolidated financial statements in the periods in which they were agreed by the General Meeting of Shareholders.
182–183
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
3
Risk assessment
Group-wide risk assessment, which facilitates the early identification and evaluation of risks, as well as the implementation of appropriate risk-reduction measures, is carried out every quarter and focuses mainly on project risks and financial risks. Using a bottom-up process based on risk maps for each project and unit, the results of all the individual risk and opportunity assessments are consolidated. As part of the accounting and control process, Group Risk Management reports twice a year to the Executive Committee, the Audit Committee and the Board of Directors.
3.1 Financial risk management The principles used for financial risk management are defined at Group level and apply to all Group entities. They include rules about holding and investing liquid assets, taking on debt, and hedging against foreign currency, price and interest rate risks. Compliance with the rules is monitored centrally on a continuous basis. Overall, the Group follows a conservative, risk-averse approach.
3.2 Credit risk The credit risk consists mainly of the risk of default on trade receivables and cash and cash equivalents.
3.2.1 Trade receivables Agreements with customers generally stipulate payment terms of between 30 and 90 days. The creditworthiness of customers is verified prior to any contract being signed. Revenue is generated mainly through transactions with public-sector bodies and high-quality debtors (banks, insurance companies, pension funds, etc.). As a rule, no collateral is requested. However, in the case of services relating to real estate, it is legally possible to have a lien on the real estate (right of lien of tradesmen and building contractors). Notice of payments outstanding is given as part of a standardised reminder procedure. Regular reports are made monitoring the progress of receivables, particularly those that are overdue. Irrecoverable debts are negligible in relation to Group revenue. The three largest counterparty exposures under trade receivables amount to CHF 69.2 million (2010: CHF 47.9 million). This is equivalent to 14.6% of the carrying amount of all trade receivables (2010: 12.1%).
3.2.2 Cash and cash equivalents and other financial assets The Group’s main financial instruments are cash and cash equivalents, trade receivables, financial and other receivables, current and non-current financial liabilities and trade payables. Trade receivables and payables are generated in the course of normal business activities. Financial liabilities are used exclusively to finance operating activities. Financial investments serve mainly to finance associates (loans). Derivative financial instruments may only be used within the Group to hedge operating activities. Owing to the low level of foreign currency risk, derivative financial instruments are rarely used. At the balance sheet date, the Group held no derivative financial instruments (2009: none). The main risks for the Group resulting from financial instruments are credit risk, liquidity risk and market risk.
The credit risk relating to cash and cash equivalents and other financial assets resides in the non-payment of receivables due to debtor insolvency. Debtors are subject to regular creditworthiness checks by means of a review of their financial situation. In the case of cash and cash equivalents, the counterparty must also have a minimum rating or a state guarantee. A number of Swiss cantonal banks continue to enjoy what is known as a state guarantee. This means that in the event of the bank’s insolvency, the canton (the state) – as owner of the bank – guarantees all outstanding liabilities remaining after all the assets have been realised. Creditors therefore have complete security. This rule does not apply to subordinated bonds or participation capital (a specific component of equity). Because of the state guarantee, disclosure by class of financial asset is irrelevant as the credit balances are backed either by the bank’s own funds or, on a secondary basis, by the state. In the case of these exposures, the exposure per counterparty is limited to a maximum amount. Creditworthiness is monitored regularly using market-based information (e.g. CDS spreads), and appropriate measures are taken if necessary. The three largest counterparty exposures under cash and cash equivalents amount to CHF 240 million (2010: CHF 278 million). This is equivalent to 59.7% of the carrying amount of the total cash and cash equivalents (2010: 79.6%). The maximum credit risk corresponds to the amount of individual receivables in the event of default. Age structure of customer accounts receivable: see Note 14.
184–185
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
3.3 Liquidity risk
The following table shows receivables from the most important counterparties on the balance sheet date: Rating2
Balance
The liquidity risk resides mainly in the eventuality that liabilities cannot be honoured on the due date.
CHF 1,000
As at 31.12.2011 Counterparty1 Trade receivables Public sector and its operations Financial institution Public sector and its operations
n.a.
31,365
A
23,061
n.a.
14,743
Future liquidity is forecast based on a variety of rolling planning horizons. The Group endeavours at all times to have sufficient lines of credit to cover its planned funding requirements. As at 31 December 2011, the Group had cash and cash equivalents of CHF 402.5 million (2010: CHF 349.3 million) and unused credit lines of CHF 174.9 million (2010: CHF 176.3 million). The Group seeks to maintain appropriate minimum liquidity (consisting of cash and cash equivalents and confirmed unused credit lines). Short-term
Cash and other financial assets Financial institution
AAA
134,458
Financial institution
A
56,968
Financial institution
AA+
49,033
4–12 mths
2–5 years
over 5 years
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
As at 31.12.2011 Trade payables and other liabilities Financial liabilities
As at 31.12.2010
Long-term
0–3 mths
Bond issue
(325,908)
(2,411)
–
–
(1,835)
(2,368)
(6,899)
(825)
–
(6,250)
(225,000)
–
(251,009)
(10,915)
–
–
(1,464)
(141)
(316)
(98)
–
(6,250)
(25,000)
(206,250)
Counterparty1 Trade receivables
As at 31.12.2010
Public sector and its operations
n.a.
33,333
Financial institution
Aa3
8,511
Financial liabilities
Other
n.a.
6,096
Bond issue
Financial institution
Aa3
186,924
Financial institution
Aa1
70,987
Financial institution
A1
20,055
Cash and other financial assets
1 Counterparties are broken down by the following classifications: – Financial institutions (banks, insurance companies, pension funds) – Public sector and its operations – Other 2 Moody’s / Standard & Poor’s rating
Trade payables and other liabilities
186–187
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
3.4 Market risk / interest rate risk
Maturity structure as at 31 December 2010:
The Group has very few non-current interest-bearing assets. Consequently, the Group’s interest rate risk results from the structure and volume of its financing. Because the Group has financed its operations with a fixed-rate bond issue and reduced its bank funding accordingly, the risk associated with changes in interest rates is minimal; the risk of fluctuations in fair value is negligible. Interest rate increases generally have no negative impact on consolidated profit. Debt is always taken on in the functional currency of the financed entity and is therefore mainly in CHF. The maturity structure of the interest-bearing financial instruments as at 31 December 2011 is as follows: up to 1 year
2–5 years
over 5 years
Total
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
Variable rate Cash and cash equivalents Loans and other financial assets
402,532
–
–
402,532
–
382
–
382
(3,004)
(5,866)
(797)
(9,667)
(5,484)
(797)
393,247
55
40
1,791
1,886
Financial liabilities
(791)
(198,615)
–
(199,406)
Total
(736)
(198,575)
1,791
(197,520)
398,792
(204,059)
994
195,727
Total Fixed rate Loans and other financial assets
Overall total
2–5 years
over 5 years
Total
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
349,274
Variable rate Cash and cash equivalents Loans and other financial assets Financial liabilities Total
349,274
–
–
462
5,170
389
6,021
(1,605)
(316)
(98)
(2,019)
348,131
4,854
291
353,276
287
3,621
245
4,153
–
–
(197,741)
(197,741)
287
3,621
(197,496)
(193,588)
348,418
8,475
(197,205)
159,688
Fixed rate Loans and other financial assets Financial liabilities
399,528
Financial liabilities
up to 1 year
Total Overall total
The table below shows the effect of interest rate variations on Implenia’s pre-tax profit (EBT). It is assumed that the interest rate variation affects the entire financial year. 2011
2010
Change in interest rates in percentage points
+/– 0.5
+/– 0.5
Sensitivity / change profit before tax in CHF 1,000
+/– 957
+/– 856
188–189
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
3.5 Market risk / currency and other risks The risk related to exchange rate fluctuations is not significant and mainly concerns the translation risk of net foreign currency investments made in foreign subsidiaries. Currency risks arise at Implenia Group from the Group’s international orientation, from investments in foreign subsidiaries or from the setting up of foreign operations (translation risk). There are also currency risks from future business transactions or assets and liabilities recognised in the balance sheet in currencies other than the functional currency of the company in question. Implenia Group is mainly exposed to risks from the Euro, US Dollar and Norwegian Krone. Based on the assumption that the euro had been 10% stronger against the Swiss franc on 31 December 2011, consolidated profit would have been CHF 0.4 million lower (2010: CHF 0.7 million higher) and equity CHF 5.7 million higher (2010: CHF 4.2 million higher). The same sensitivity analysis for the Norwegian Krone would have resulted in higher consolidated profit of CHF 0.1 million and higher equity of CHF 3.2 million. As the Group only holds a small amount of securities, the price risk is not significant.
3.6 Defaults on financial liabilities and breaches of covenants There were no defaults on financial liabilities during the financial year (2010: none). The financial covenants stipulated in financing agreements were kept (2010: kept).
3.8 Fair value estimates Classification (level) as per IAS 391
The Group targets an equity ratio of around 30% (2010: 30%). As at the reporting date, the equity ratio was 28.7% (2010: 29.5%). The aim is for current assets to be financed through current debt. Non-current assets should be financed through non-current liabilities and equity. Ordinary capital expenditures are to be financed through ongoing cash flows where possible. Economic capital matches the value carried in the consolidated balance sheet. The syndicated loan has various financial covenants attached to it. Financial position and performance are monitored monthly. The latest actual figures, and projections and budgets are used to monitor compliance with the financial covenants.
Fair values
31.12.2010
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
349,274
Financial assets Cash and cash equivalents Marketable securities Trade receivables Other receivables Unlisted participation Loans and other financial assets
LaR
402,532
349,274
402,532
AfS (level 2)
516
346
516
346
LaR
472,789
395,234
472,789
395,234 27,989
LaR
45,285
27,989
45,285
AfS (level 3)
7,185
6,516
7,185
6,516
LaR
2,579
10,196
2,579
10,196
930,886
789,555
930,886
789,555
Total Financial liabilities Current financial liabilities
OFL
3,795
1,605
3,795
1,605
Trade payables
OFL
272,537
217,347
272,537
217,347
Other current liabilities
OFL
55,782
44,577
55,782
44,577
Non-current financial liabilities
OFL
205,278
198,155
213,350
208,600
Other non-current liabilities
OFL
Total
3.7 Policy regarding capital structure and indebtedness
Carrying amounts
31.12.2011
7,295
–
7,295
–
544,687
461,684
552,759
472,129
1 Classifications as per IAS 39: – LaR: Loans and receivables – AfS: Available for sale (measured at fair value according to the following hierarchy) – OFL: Other financial liabilities
190–191
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
Fair value hierarchy:
4
Level 1 – The inputs used are unadjusted listed prices on active markets for identical assets and liabilities as at the reporting date.
4.1 Management decisions used when applying accounting policies
Level 2 – The inputs used (with the exception of the listed prices mentioned in level 1) for the asset or liability are either directly or indirectly observable. These inputs are mainly derived from or confirmed by observable market data using correlations or by other means on the reporting date and for the expected term of the instruments. Generally, the assets found in this category are time deposits, currency and interest rate derivatives and certain investment funds. Currency and interest rate derivatives are measured using observable market data. The liabilities in this category are generally currency derivatives and equity options. Level 3 – The inputs are not observable. They reflect the Group’s best estimate of the criteria that market participants would use to determine the price of the asset or liability on the reporting date. Allowance is made for the inherent risks in the valuation procedure and the model inputs. Assets in this category are generally securities not traded on active markets. These are valued using discounted cash flow methodology. Losses related to receivables and liabilities in the amount of CHF 0.2 million (2010: CHF 8.4 million) were recorded in the income statement. Gains of CHF 0.5 million (2010: CHF 0.5 million) relating to available for sale financial instruments were recognised in the income statement. A gain of CHF 0.1 million (2010: CHF 2.7 million) arising from an adjustment in the fair value of long-term investments is recognised in comprehensive income. No further purchases were made during the year. The Group had no held to maturity financial instruments during the year (2010: none).
Key management decisions and estimates
4.1.1 Revenue recognition The nature of the Group’s business is such that many sales transactions have a complex structure. Sales agreements may comprise many elements which occur at different times. Revenue is only recognised when, in the opinion of management, the significant risks and rewards concerned have been transferred to the buyer, the Group is no longer involved in managing further business activities or no longer exercises de facto control over the goods sold, and the obligations have been met. Consequently, for some transactions, the payments received or the work performed are accrued in the balance sheet and taken to the income statement in future accounting periods when the contractual conditions have been met.
4.1.2 Fully consolidated companies, associates and joint ventures The Group performs transactions which give rise to the right to control or significantly influence the operating activities or the company. Such transactions include the acquisition of all or part of the share capital of other companies, the purchase of certain assets and the assumption of certain liabilities or contingent liabilities. In all such cases, management makes an assessment as to whether the Group has control or significant influence over the company’s operations. On the basis of this assessment, the company is either fully consolidated or consolidated as an associate. Such assessment takes into consideration the underlying economic substance of the transaction, and not solely the contractual terms.
4.1.3 Leasing In the case of leasing agreements, Implenia takes on the role of lessee. The treatment of leasing transactions in the consolidated financial statements is primarily dependent on whether the lease is classified as an operating lease or a finance lease. In making this assessment, management looks at both the type and the legal form of the lease and comes to a decision on whether substantially all the risks and rewards of the leased asset are transferred to the lessee. Agreements that do not take the legal form of a lease but nevertheless confer the right to use an asset are also an integral part of such assessments.
192â&#x20AC;&#x201C;193
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
4.2 Key assumptions and sources of estimation uncertainty
4.2.2 Pension plans
When preparing the consolidated financial statements in conformity with IFRS, management is required to make estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses and related disclosures. The estimates and assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances. These are used as the basis for measuring those assets and liabilities whose carrying amounts are not readily apparent from other sources. Actual values may differ from these estimates.
Group employees are members of employee benefit schemes which are treated as defined benefit plans under IAS 19. The calculation of the recognised assets and liabilities from these plans is based on statistical and actuarial calculations performed by actuaries. The present value of defined benefit liabilities in particular is heavily dependent on assumptions such as the discount rate used to calculate the present value of future pension liabilities, future salary increases and increases in employee benefits. In addition, the Groupâ&#x20AC;&#x2122;s independent actuaries use statistical data such as probability of withdrawals of members from the plan and life expectancy in their assumptions.
Estimates and assumptions are reviewed on an ongoing basis. Changes to estimates may be necessary if the circumstances on which they were based have changed or new information or additional insights have become available. Such changes are recognised in the reporting period in which the estimate was revised. The key assumptions about the future and the key sources of estimation uncertainty which may require material adjustments to the carrying amounts of assets and liabilities within the next twelve months are listed below.
4.2.1 Property, plant and equipment, intangible assets The Group has property, plant and equipment with a carrying value of CHF 225.4 million (2010: CHF 221.1 million), goodwill with a carrying amount of CHF 85.7 million (2010: CHF 69.2 million) and other intangibles with a carrying amount of CHF 5.0 million (2010: CHF 4.1 million). Goodwill and intangible assets with unlimited useful life are reviewed annually for impairment. To decide whether any impairment exists, estimates are made of future cash flows expected to arise from the use of these assets and their eventual disposal. Actual cash flows may differ significantly from the future discounted cash flows based on these estimates. Factors such as changes in the planned use of buildings, machinery and equipment, technical obsolescence or lower-than-forecast sales may result in shortened useful life or impairment. Changes in the discount rates, gross margins and growth rates used may also result in impairments.
Impleniaâ&#x20AC;&#x2122;s assumptions may differ substantially from actual results owing to changes in market conditions and the economic environment, higher or lower withdrawal rates, longer or shorter lifespans among members and other estimated factors. These differences may affect the values of the assets and liabilities from employee benefit schemes recognised in the balance sheet in future reporting periods.
194–195
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
5
Segment reporting
Segment reporting as submitted to the Board of Directors as at 31 December 2011:
Real Estate General Contracting / Services
Industrial Construction Total of divisions
Project Development
Infrastructure Construction
Tunnelling
Prime Buildings
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
1,187,663
227,217
1,147,649
242,870
19,759
(98,429)
(15,759)
(183,082)
(8,177)
(890)
External revenues
1,089,234
211,458
964,567
234,693
of which services
1,089,206
93,479
946,152
28
117,979
18,415
19,659
25,297
923
106
CHF 1,000
Segment revenue Intragroup revenue
of which goods Operating income Investments in property, plant and equipment and intangible assets Total assets Total liabilities Total equity
Miscellaneous / Holding
Total
CHF 1,000
CHF 1,000
2,825,158
61,266
2,886,424
(306,337)
(57,441)
(363,778)
18,869
2,518,821
3,825
2,522,646
234,601
18,869
2,382,307
3,825
2,386,132
92
–
136,514
–
136,514
18,100
32,785
(2,312)
93,529
147
93,676
30,623
5,599
90
37,341
2,421
39,762
483,949
330,678
752,681
265,284
12,505
1,845,097
42,606
1,887,703
(493,213)
(107,420)
(539,862)
(126,773)
(35,079)
(1,302,347)
(41,828)
(1,344,175)
9,264
(223,258)
(212,819)
(138,511)
22,574
(542,750)
(778)
(543,528)
196–197
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
Segment reporting as submitted to the Board of Directors as at 31 December 2010:
Real Estate General Contracting / Services
Industrial Construction Total of divisions
Project Development
Infrastructure Construction
Tunnelling
Prime Buildings
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
1,136,717
173,783
1,200,636
152,035
13,989
(85,720)
(17,049)
(178,598)
(10,944)
(3,021)
External revenues
1,050,997
156,734
1,022,038
141,091
of which services
CHF 1,000
Segment revenue Intragroup revenue
Miscellaneous / Holding
Total
CHF 1,000
CHF 1,000
2,677,160
61,351
2,738,511
(295,332)
(54,761)
(350,093)
10,968
2,381,828
6,590
2,388,418
1,040,678
2,489
1,008,154
134,286
10,968
2,196,575
6,590
2,203,165
of which goods
10,319
154,245
13,884
6,805
–
185,253
–
185,253
Operating income
15,385
20,925
25,117
18,639
(3,069)
76,997
661
77,658
108
25
38,144
621
22
38,920
600
39,520
Investments in property, plant and equipment and intangible assets Total assets Total liabilities Total equity
473,815
316,510
697,930
166,750
9,811
1,664,816
12,187
1,677,003
(437,037)
(111,951)
(495,203)
(90,982)
(28,042)
(1,163,215)
(18,304)
(1,181,519)
(36,778)
(204,559)
(202,727)
(75,768)
18,231
(501,601)
6,117
(495,484)
198–199
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
Reconciliation of total segment assets to total assets Deviation Total assets Reconciliation of total segment liabilities to total liabilities Deviation Total liabilities
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
1,887,703
1,677,003
–
–
1,887,703
1,677,003
(1,344,175)
(1,181,519)
–
–
(1,344,175)
(1,181,519)
Implenia AG is domiciled in Switzerland. Revenues from third parties in Switzerland amounted to CHF 2,368 million (2010: CHF 2,313 million). Revenues generated abroad came to CHF 155 million (2010: CHF 73 million). Non-current assets located in Switzerland (excluding financial assets and deferred tax assets) as at 31 December 2011 stood at CHF 283 million (2010: CHF 295 million). Non-current assets located abroad (excluding financial assets and deferred tax assets) stood at CHF 52 million (2010: CHF 7 million).
6
Materials and sub-contractors
Operating income
93,676
77,658
Financial expenses
(15,827)
(13,791)
Financial income Profit before tax Tax Consolidated profit
3,805
4,174
81,654
68,041
(20,303)
(15,583)
61,351
52,458
317,572
342,573
1,248,295
1,138,369
Total
1,565,867
1,480,942
7
Personnel expenses
Amortisation of intangible assets
(2,818)
(1,871)
Income from defined benefit pension plans
12,862
6,880
Depreciations of investment property
(5,428)
–
Other expenses net
(4,469)
(4,348)
147
661
Total operating income Miscellaneous / Holding
2011
2010
CHF 1,000
CHF 1,000
486,722
464,417
Social security contributions
64,881
61,933
Pension expenses
22,210
27,546
Expenses for the foundation for flexible retirement
11,304
11,148
Temporary staff
60,628
67,438
Other personnel expenses
25,436
22,553
671,181
655,035
Wages, salaries and fees Operating income from Miscellaneous / Holding includes:
2010 CHF 1,000
External services
Material expense Reconciliation of operating income to consolidated profit
2011 CHF 1,000
Total
200â&#x20AC;&#x201C;201
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
8
Profit sharing schemes
In 2011, they were allocated at a price of CHF 24.05 per share (2010: CHF 31.95 per share). 2011
2010
Number
54,331
75,261
CHF 1,000
1,307
2,451
8.1 Staff scheme On 25 March 2010, the new Implenia Group rules on staff profit sharing were approved. In each calendar year, qualifying persons may subscribe for Implenia AG shares in the amount of one-half of the gross monthly salary or an entire gross monthly salary. The annual subscription right may be divided between the March and September purchase periods. For the March 2011 purchase period, the difference between the market price of CHF 31.55 per share on average and the preferential price of CHF 22.10 per share was charged to the income statement, and for the September 2011 purchase period, the difference between the market price of CHF 24.74 per share on average and the preferential price of CHF 17.30 per share was charged to the income statement.
Number of shares subscribed Amount recognised in the income statement
2011
2010
Number
49,023
84,743
CHF 1,000
342
848
The shares cannot be traded for a period of three years. During this time, employees are entitled to dividends and may exercise their voting rights. Upon expiry of the blocking period, the shares may be freely traded by employees.
8.2 Share-based compensation for the Executive Committee The Members of the Executive Committee receive part of their compensation in the form of shares of Implenia AG, which are blocked for a period of three years. During this time, the Members of the Executive Committee are entitled to dividends and may exercise their voting rights. The corresponding amount is expensed entirely in the current financial year. The amount charged to the Group is calculated on the basis of the market value of the shares at the time of allocation. The Group may either buy shares on the market or draw from its own stock of shares.
Allocation of shares Amount recognised in the income statement
8.3 Share-based compensation for Members of the Board of Directors Some Members of the Board of Directors receive a portion of their remuneration in the form of shares, which are blocked for a period of three years. During this time, the Members of the Board of Directors are entitled to dividends and may exercise their voting rights. The cost is calculated and reported in the same way as for shares allocated to the Executive Committee.
Allocation of shares Amount recognised in the income statement
2011
2010
Number
4,868
5,324
CHF 1,000
139
158
202â&#x20AC;&#x201C;203
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
9
Other operating expenses
10
Financial expenses and income
2011
2010
2011
2010
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
Rental expenses
44,570
41,760
Financial expenses
Infrastructure expenses
19,422
17,847
Interest expenses
1,920
1,157
Maintenance and repairs
35,048
37,231
Interest on bond issue (since 12 May 2010)
6,637
4,171
3,107
3,184
Administration and consultants
14,511
16,707
Office and communication expenses
Insurance
604
524
Fixed costs of financial guarantees
1,298
1,268 3,335
Bank charges
19,065
16,984
Other financial expenses
2,713
Taxes and fees
5,267
5,632
Currency losses
2,655
3,336
Marketing, advertising and other administration expenses
7,511
6,660
Total
15,827
13,791
Interest income
671
701
Income from financial investments
531
531
96
1,860
Currency gains
2,507
1,082
Total
3,805
4,174
(12,022)
(9,617)
Other operating expenses Total
1,681
1,025
150,182
147,030
Financial income
Other financial income
Financial result
204–205
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
11
Tax
Analysis of tax rate 2011
2010
CHF 1,000
CHF 1,000
Switzerland
85,708
66,012
Abroad
(4,054)
2,029
Total profit before tax
81,654
68,041
The following elements explain most of the differences between the expected Group tax rate (the weighted average tax rate, based on the pre-tax profit of each Group company) and the effective tax rate:
Profit before tax
Current and deferred tax Switzerland
10,376
10,001
2,102
1,763
12,478
11,764
Switzerland
8,704
3,819
Abroad
(879)
–
Total deferred tax
7,825
3,819
20,303
15,583
Abroad Total current tax
Total tax
2011
2010
%
%
22.7%
22.2%
Effect of non-taxable items
0.2%
(1.2%)
Effect of non-deductible items
0.3%
0.1%
Effect of non-capitalised tax losses arising during the year
3.2%
1.6%
Effect of changes in the applicable tax rates
(0.6%)
(0.9%)
Effect of the use of non-capitalised tax loss carryforwards
(0.6%)
(0.1%)
0.7%
0.9%
Income components with different tax rates
(0.6%)
0.3%
Other effects
(0.4%)
0.0%
Effective tax rate
24.9%
22.9%
Expected tax rate
Prior years’ taxes
The change in the expected tax rate relates mainly to the changed composition of the profits of the Group companies in the respective Swiss cantons and foreign countries.
206–207
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
12
Cash and cash equivalents
Cash Bank and post office accounts Other cash equivalents Total
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
358
357
388,495
345,330
13,679
3,587
402,532
349,274
The “Bank and post office accounts” line item includes assets of CHF 10.6 million (2010: CHF 3.4 million) held on a fiduciary basis for general contractor projects. These balances can only be used to pay subcontractors for the respective projects in which the client’s bank financing the construction loan has released the funds.
Allowance is made for receivables that are in arrears in the form of individual and collective value adjustments, calculated on the basis of current experience. Past experience has shown that this risk can be regarded as minor. Valuation allowances are only disclosed separately for trade receivables. For all other financial instruments, value adjustments are directly offset. Allowance for doubtful receivables:
CHF 1,000
12,579
12,603
4,217
6,472
Used
(738)
(516)
(4,066)
(5,833)
Foreign exchange differences
Marketable securities
31.12.2010
CHF 1,000
Increase
As at 1.1.
Reversed
13
31.12.2011
Total
(33)
(147)
11,958
12,579
Marketable securities consist of bills of exchange receivable in the amount of TCHF 516 (2010: TCHF 346).
14
Trade receivables
Third parties Joint ventures Associates
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
413,526
317,379
39,734
56,254
3,280
4,692
62
–
28,145
29,488
Allowance for doubtful receivables
(11,958)
(12,579)
Total
472,789
395,234
6,272
–
Related parties Guarantee retentions
of which pledged
In 2006 / 2007 Implenia built the Letzigrund Stadium in record time, so that it could be approved and used for EURO 08. In view of the very tight construction schedule, the City of Zurich called for 1,392 changes and amendments to be made to the planning specifications. More than half of these were implemented in the final 12 months of the stadium’s construction. This generated significant additional costs which were thoroughly documented and accounted for. From early 2006 onwards, Implenia brought the financial impact to the attention of the city authorities at regular intervals. This impact eventually totalled CHF 22.9 million. Implenia’s final bill was for CHF 119.5 million. The City of Zurich has so far paid CHF 96.6 million, so that a consideration in the amount of CHF 22.9 million is now outstanding. After numerous attempts by Implenia to reach an amicable settlement in the dispute over payment of these additional costs were rejected by the city authorities, Implenia has now taken legal action to obtain full payment of the amount owing of CHF 22.9 million.
208–209
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
Overdue
Overdue Total
Total
Third parties Joint ventures Associates Related parties Sub-total Guarantee retentions Allowance for doubtful receivables Total
31.12.2011
Not due
1–30 days
31–60 days
61–90 days
>90 days
31.12.2010
Not due
1–30 days
31–60 days
61–90 days
>90 days
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
413,526
249,496
37,757
12,032
8,023
106,218
317,379
156,058
50,386
17,140
5,795
88,000
39,734
20,778
4,789
2,818
1,376
9,972
56,254
25,162
7,607
4,988
3,016
15,481
3,280
2,039
122
–
–
1,119
4,692
2,452
740
257
276
967
62
62
–
–
–
–
–
–
–
–
–
–
456,602
272,375
42,668
14,850
9,399
117,310
378,325
183,672
58,733
22,385
9,087
104,448
28,145
Third parties Joint ventures Associates Related parties Sub-total Guarantee retentions
29,488
(11,958)
Allowance for doubtful receivables
(12,579)
472,789
Total
395,234
As at 31 December 2011, total overdue receivables amounted to CHF 184.2 million (2010: CHF 194.7 million). With regard to the trade receivables that were neither impaired nor in arrears, there were no indications at the balance sheet date that the customers would not be able to meet their financial obligations. As in the previous year, no guarantees were held at the balance sheet date.
210â&#x20AC;&#x201C;211
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
15
Work in progress
16
Work in progress includes accruals for work that has been carried out but not yet invoiced, including on-site inventories, advance payments from customers and to suppliers for work not yet carried out, accruals for outstanding invoices from suppliers and subcontractors, and provisions for losses on the order book and work in progress. 31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
220,098
228,891
Work in progress, liabilities
(555,083)
(499,204)
Work in progress, net
(334,985)
(270,313)
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
Work in progress, assets
Work in progress, assets (services provided but not yet invoiced) Work in progress, liabilities (services invoiced but not yet provided) Value adjustment on contract costs
282,731
240,397
(279,932)
(203,316)
(10,449)
(14,950)
Joint ventures
Initial measurement of joint ventures is at cost. In subsequent years, the carrying amount is increased by the proportional share of profits and reduced by the proportional share of losses through the income statement. Liquidity contributions and disbursements increase or reduce the carrying amount respectively without being taken through the income statement. The resulting asset or liability is recognised in the balance sheet. Net asset
Net asset
Net liability
2011
2010
2011
2010
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
45,113
Net liability
As at 1.1
23,770
2,613
44,218
Change
9,782
21,157
5,123
(895)
33,552
23,770
49,341
44,218
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
Total
Net amount receivable from (payable to) joint ventures:
Joint ventures, assets Joint ventures, liabilities
33,552
23,770
(49,341)
(44,218)
54,716
72,106
Services invoiced to joint ventures but not yet received
39,734
56,254
Contract costs in relation to past services by suppliers and sub-contractors
(382,051)
(364,550)
Services invoiced by joint ventures but not yet paid
(4,933)
(2,368)
Work in progress, net
(334,985)
(270,313)
Total
19,012
33,438
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
Contract revenues since start of project
9,674,201
9,403,891
Contract revenues recognised in the period
2,056,673
2,026,798
Advance payments received
71,849
87,092
Guarantee retentions
28,145
29,488
Contract costs in relation to future services by suppliers and sub-contractors
212–213
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
Implenia’s share in the assets and liabilities (the balance sheet shows assets and liabilities of joint ventures as at the reporting date), revenue (Implenia’s share of revenues) and expenses of joint ventures is as follows:
Total assets Total liabilities Net assets Net revenue Expenses Income from joint ventures
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
369,681
381,319
(376,299)
(394,176)
(6,618)
(12,857)
466,440
533,782
(435,818)
(522,486)
30,622
11,296
The income from joint ventures of CHF 30.6 million (2010: CHF 11.3 million) includes the results reported in the individual balance sheets of the joint ventures of CHF 17.6 million (2010: CHF 10.0 million) and the internal valuations of CHF 13.0 million (2010: 1.3 million). A large part of the change in income from joint ventures was caused by the valuation of the Consorzio TAT, due to an agreement with the client dated 15 December 2011.
17
Other receivables 31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
Withholding tax
1,009
1,094
Other taxes and duties
2,218
2,574
Social insurances
5,198
3,275
WIR cheques
12,868
13,338
Receivables from utilised guarantees
18,677
12,207
Other receivables Total
Joint and several liability of partners in joint ventures
Major joint ventures in terms of Implenia’s share of revenue:
CHF 1,000
1000 CHF
150,858
191,467
Participation Implenia
Participation Implenia
Consorzio TAT Tunnel Alp Transit Ticino
25.0%
25.0%
ARGE Transco Gottardo Sedrun
40.0%
40.0%
Groupement Marti-Implenia (Nant de Drance, Emosson)
50.0%
50.0%
ARGE Tunnel Weinberg ATW
45.0%
45.0%
ARGE 2.1 Bahnhof Löwenstrasse
25.5%
25.5%
ARGE Cityring Luzern
20.0%
20.0%
7,501
45,285
39,989
The City of Zurich has called in the guarantee provided when carrying out the Letzigrund stadium project, obliging Implenia to make a payment of CHF 12 million, which is shown under ’Receivables from utilised guarantees’. Implenia has taken legal action to obtain full payment of the utilised guarantee.
18
Raw materials
Services invoiced to joint ventures which have been recognised in the revenue of Implenia are disclosed in Note 33. The partners in joint ventures are jointly and severally liable for any debts of the joint ventures unless otherwise agreed. 31.12.2011 31.12.2010
5,315
Raw materials Value adjustment Total of which pledged
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
23,398
21,843
–
–
23,398
21,843
–
–
In 2011, the cost of raw materials taken to income in the consolidated financial statements amounted to CHF 252 million (2010: CHF 297 million). Inventory is divided equally between raw materials and ancillary materials. The value adjustment for the current year is CHF 0 (2010: CHF 0). No value adjustments were reversed (2010: none).
214–215
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
19
Real estate transactions
Acquisition costs as at 1.1
20 31.12.2010
CHF 1,000
CHF 1,000
Business premises
Production facilities
Machinery, furniture, IT
Assets under construction
Total
234,735
181,556
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
414,317
Additions
76,459
50,848
Disposals
(29,946)
(108,681)
Reclassifications
(17,751)
5,199
–
110,178
Change in scope of consolidation
(568)
(4,365)
Cumulative acquisition costs
262,929
234,735
Cumulative value adjustments as at 1.1
(16,752)
(12,824)
(886)
(499)
Foreign exchange differences
Additions Disposals Reclassifications
516
3,730
1,209
(7,395)
31
236
Cumulative value adjustments
(15,882)
(16,752)
Net carrying amount
247,047
217,983
10,949
15,293
–
–
Foreign exchange differences
of which pledged of which capitalised borrowing costs The gain on sale of real estate during the period is as follows: Sale proceeds Carrying amount of assets sold Gain on real estate1 1 excluding expenses and depreciation of the Project Development segment
Property, plant and equipment
31.12.2011
59,997
141,600
(29,430)
(104,951)
30,567
36,649
31.12.2011 112,912
56,054
243,250
2,101
Additions
Acquisition costs as at 1.1.2011
5,092
819
28,724
4,085
38,720
Disposals
(138)
(7,363)
(28,660)
(45)
(36,206)
Reclassifications
6,420
(6,420)
–
–
–
Change in scope of consolidation
188
34
10,517
569
11,308
Foreign exchange differences
(37)
(28)
384
27
346
Cumulative acquisition costs as at 31.12.2011
124,437
43,096
254,215
6,737
428,485
Cumulative depreciations as at 1.1.2011
(35,573)
(31,668)
(126,023)
–
(193,264)
Additions
(3,780)
(2,987)
(28,007)
–
(34,774)
Disposals
65
1,587
23,172
–
24,824
(3,351)
3,351
–
–
–
12
30
52
–
94
(42,627)
(29,687)
(130,806)
–
(203,120)
81,810
13,409
123,409
6,737
225,365
–
–
10,488
–
10,488
45,534
–
–
–
45,534
–
–
–
–
–
Reclassifications Foreign exchange differences Cumulative depreciations as at 31.12.2011 Net carrying amount as at 31.12.2011 of which finance leases of which pledged of which capitalised borrowing costs
216–217
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
Leasing agreements where the Group is lessee
Business premises
Production facilities
Machinery, furniture, IT
Assets under construction
Total
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
Finance leases: Future minimum lease payment
31.12.2010 Acquisition costs as at 1.1.2010 Additions Disposals Reclassifications Foreign exchange differences
129,349
48,322
243,360
5,806
426,837
2011
2010
2011
2010
456
2,626
32,094
4,320
39,496
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
Less than 1 year
3,157
275
2,749
241
Between 2 and 5 years
6,412
159
5,866
139
692
–
664
–
10,261
434
9,279
380
(4,496)
(225)
(29,882)
–
(34,603)
(11,920)
6,420
–
(8,025)
(13,525)
(477)
(1,089)
(2,322)
–
(3,888)
Cumulative acquisition costs as at 31.12.2010
112,912
56,054
243,250
2,101
414,317
Cumulative depreciations as at 1.1.2010
(47,146)
(26,339)
(130,778)
–
(204,263)
Additions
(4,186)
(2,857)
(25,881)
–
(32,924)
Disposals
2,614
10
28,823
–
31,447
12,946
(3,351)
–
–
9,595
199
869
1,813
–
2,881
(35,573)
(31,668)
(126,023)
–
(193,264)
Reclassifications Foreign exchange differences Cumulative depreciations as at 31.12.2010 Net carrying amount as at 31.12.2010 of which finance leases of which pledged of which capitalised borrowing costs
Net present value of minimum lease payment
77,339
24,386
117,227
2,101
221,053
–
–
–
–
–
44,284
–
–
–
44,284
–
–
–
–
–
Over 5 years Total
The increase is due to the acquisition of the Betonmast Anlegg Group, which has entered into numerous longterm agreements for the rental of construction machinery. Operating leases: Future minimum lease payment
2011
2010
CHF 1,000
CHF 1,000
Less than 1 year
25,829
13,531
Between 2 and 5 years
58,575
44,244
Over 5 years
15,716
13,056
100,120
70,831
Total
The subsidiaries have entered into numerous operating leases, mainly for the short-term rental of construction machinery. The total expense for operating leases was TCHF 49,456 (2010: TCHF 41,758).
218–219
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
21
Investment property
22
Investments in associates
31.12.2011
31.12.2010
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
36,274
15,634
–
As at 1.1
42,675
Additions
–
–
Additions
5,351
6,289
Disposals
–
–
Disposals
(2,030)
(2,910)
17,751
14,028
Reclassification
–
364
–
1,606
Share of results
5,037
6,495
(3,851)
(3,705)
Acquisition costs as at 1.1
Reclassifications Change in scope of consolidation Foreign exchange differences Cumulative acquisition costs
–
–
33,385
15,634
Distributions Foreign exchange differences Total
Cumulative depreciations as at 1.1.
(7,902)
–
Additions
(5,486)
–
Disposals Reclassifications Change in scope of consolidation Foreign exchange differences Cumulative depreciations Net carrying amount of which pledged
–
–
(1,209)
(7,902)
–
–
72
–
(14,525)
(7,902)
18,860
7,732
2,277
–
The changes in 2011 are mainly due to a reclassification and revaluation of a property in France, which is no longer held for the purposes of development or sale. “Investment property” includes agricultural land with a net carrying amount of CHF 5.4 million (2010: CHF 5.4 million). The market value of investment property corresponds to the carrying amount.
of which pledged
(13)
(132)
47,169
42,675
–
–
If the Group’s associates do not already apply IFRS, their results are converted to IFRS. Since no current financial data was available at the time of the preparation of Implenia’s consolidated financial statements, the net profit of such associates and the corresponding share belonging to Implenia are based on management estimates. Differences between the actual results and these estimates will be recognised in the 2012 consolidated financial statements.
220–221
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
Since no reviewed data is available at present for the 2011 financial year, figures are based on the prior year and adjusted in line with expectations for business performance in the current year. Financial information as at
Assets Liabilities Net assets
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
374,732
344,683
(223,397)
(208,129)
151,335
136,554
Revenue
251,561
215,931
Expenses
(224,912)
(190,185)
26,649
25,746
Net profit
The figures shown are the total balance sheet and income statement positions, not merely Implenia’s share in these positions. The five most important associates (in terms of carrying amount) during the current financial year are: – MOAG Baustoffe Holding AG, Mörschwil – Reproad AG, Bremgarten – Catram AG, Chur – Argobit AG, Schafisheim – Kieswerk Oldis AG, Haldenstein The five most important associates (in terms of carrying amount) during the previous year were: – MOAG Baustoffe Holding AG, Mörschwil – Reproad AG, Bremgarten – Catram AG, Chur – Argobit AG, Schafisheim – Parking Port d’Ouchy SA A full list of associates can be found in Note 38.
23
Other financial assets 31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
As at 1.1
16,712
15,755
Additions
2,032
158
Disposals
(9,124)
(1,828)
Reclassifications
–
(364)
Impairments
–
(117)
144
2,862
Change in scope of consolidation
–
250
Foreign exchange differences
–
(4)
9,764
16,712
Fair value adjustment
Total Breakdown Unlisted participations
7,185
6,516
Loans
2,557
10,174
Other financial assets Total of which pledged
22
22
9,764
16,712
534
–
222–223
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
24
Intangible assets IT projects
Licences and software
CHF 1,000
CHF 1,000
Brands
Customer list and order book
Goodwill
Total
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
31.12.2011 Acquisition costs as at 1.1.2011
IT projects
Licences and software
CHF 1,000
CHF 1,000
Brands
Customer list and order book
Goodwill
Total
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
31.12.2010 Acquisition costs as at 1.1.2010
3,812
3,689
2,881
13,290
69,193
92,865
3,812
3,666
2,881
13,290
69,193
92,842
Additions
–
1,042
–
–
–
1,042
Additions
–
24
–
–
–
24
Disposals
–
–
–
–
–
–
Disposals
–
–
–
–
–
–
Foreign exchange differences
Change in scope of consolidation Foreign exchange differences Cumulative acquisition costs as at 31.12.2011 Cumulative amortisations as at 1.1.2011
– –
3,812
– –
4,731
– –
2,881
5,270 244
18,804
15,748 756
85,697
21,018 1,000
115,925
(3,812)
(3,540)
(2,681)
(9,509)
–
(19,542)
Additions
–
(305)
(200)
(5,162)
–
(5,667)
Disposals
–
–
–
–
–
–
Foreign exchange differences Cumulative amortisations as at 31.12.2011
–
(3,812)
–
(3,845)
–
(2,881)
(42)
(14,713)
–
–
(42)
(25,251)
Net carrying amount as at 31.12.2011
–
886
–
4,091
85,697
90,674
of which pledged
–
–
–
–
–
–
of which with unlimited useful life
–
–
–
–
85,697
85,697
Residual life (years)
–
3
–
1
n.a.
–
–
(1)
–
–
–
(1)
Cumulative acquisition costs as at 31.12.2010
3,812
3,689
2,881
13,290
69,193
92,865
Cumulative amortisations as at 1.1.2010
(3,812)
(3,329)
(2,482)
(7,950)
–
(17,573)
Additions
–
(212)
(199)
(1,559)
–
(1,970)
Disposals
–
–
–
–
–
–
Foreign exchange differences
–
1
–
–
–
1
(3,812)
(3,540)
(2,681)
(9,509)
–
(19,542)
Net carrying amount as at 31.12.2010
–
149
200
3,781
69,193
73,323
of which pledged
–
–
–
–
–
–
of which with unlimited useful life
–
–
–
–
69,193
69,193
Residual life (years)
–
1
1
3
n.a.
–
Cumulative amortisations as at 31.12.2010
Goodwill is allocated to the relevant cash-generating units. The goodwill resulting from the acquisition of Batigroup is allocated across the relevant areas created by the internal reorganisation.
224–225
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
The recoverable amount of a cash-generating unit is determined by calculating its value in use by means of the discounted cash flow method. This calculation is based on the 2012 budget and the projected cash flows derived from the 2012–2014 business plan approved by management. Subsequent years’ cash flows are estimated based on the growth rates shown below.
25
Current and non-current financial liabilities
As at 1.1
199,760
42,853
Goodwill is distributed between the cash-generating units as follows:
Additions
2,544
630,169
Disposals
(431)
(473,316)
Change in scope of consolidation
6,869
54
31.12.2011
Change
31.12.2010
CHF 1,000
CHF 1,000
CHF 1,000
Implenia Construction AG – Infrastructure Construction
12,835
–
12,835
Implenia Construction AG – Tunnelling
15,596
–
15,596
Implenia Generalunternehmung AG
30,467
–
30,467
Implenia AS – Norway
16,504
16,504
–
Reuss Engineering AG
10,295
–
10,295
Liabilities to banks and other financial institutions
Total
85,697
16,504
69,193
Finance lease liabilities
Foreign exchange differences Total
Bond issue
Total
CHF 1,000
331
–
209,073
199,760
198,128
197,741
796
1,077
9,279
376
870
566
209,073
199,760
3,795
1,605
Maturity
Implenia Construction AG
Gross margin
31.12.2010
CHF 1,000
Breakdown
Other financial liabilities Assumptions for the calculation of value in use:
31.12.2011
Less than 1 year
Infrastructure Construction
Tunnelling
Implenia GU AG
Implenia AS Norway
Reuss Eng. AG
%
%
%
%
%
5.9%
8.7%
5.1%
7.0%
29.5%
Between 2 and 5 years Over 5 years Total
204,481
316
797
197,839
209,073
199,760
Discount rate, pre-tax
7.8%
9.9%
9.9%
15.0%
9.9%
Post-business plan growth rate
1.0%
1.0%
1.0%
2.5%
0.5%
As at 31 December 2011, Implenia had a cash limit of CHF 150 million and guarantee limit of CHF 450 million. The syndicated loan agreement runs until 30 September 2012.
Management has defined the budgeted gross margin based on historical trends and expectations of future market development. The weighted average growth rates are in line with those for the construction industry in Switzerland. Discount rates are pre-tax and reflect the specific risks faced by the segments concerned.
In addition, Implenia has bilateral loan agreements with several banks in the amount of CHF 35.9 million (2010: CHF 28.3 million).
The impairment tests for goodwill did not lead to any need for impairment.
Non-current financial liabilities (between 1 and 5 years) include the bond issue for CHF 200 million placed on 12 May 2010. The bond pays interest of 3.125%, has a term of six years and matures on 12 May 2016. A bank consortium comprising Zürcher Kantonalbank and UBS AG placed the bond at an issue price of 100.269%. The bond is traded on the SIX Swiss Exchange (security number 11219351). The effective interest rate for calculating amortised cost is 3.356%.
226–227
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
26
Current and non-current provisions Service guarantees
Onerous contracts
Litigation
Restoration and remediation
Others
Total
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
3,564
46
5,608
27,455
2,428
39,101
31.12.2011 As at 1.1.2011 Increase Used Reversed Change in scope of consolidation Foreign exchange differences Total as at 31.12.2011 of which non-current
As at 1.1.2010 Used
–
–
30
133
215
–
(1,132)
(531)
(1,094)
(2,757)
(130)
(46)
(250)
(4,275)
–
(4,701)
332
–
–
–
–
332
9
–
–
–
(46)
(37)
3,827
–
4,226
22,679
1,421
32,153
–
–
–
5,892
–
5,892
On 12 October 2011, the foundation board decided to gradually reduce the conversion rate at the age of 65 from 6.8% to 5.65%. The gradual reduction commences from 1 February 2012 and lasts for 4 years. This plan amendment has been taken into account as of 31 December 2011 as mentioned below.
3,688
575
3,613
1,771
976
10,623
–
–
200
5,989
1,634
7,823
The reduction in the defined benefit obligation arising from the immediate reduction of the conversion rate as at 1 February 2012 amounts to TCHF 35,395. This reduction is split into TCHF 18,090 representing negative past service cost and TCHF 17,305 representing a gain on plan curtailment. This split has been calculated on the basis of average past service years (10.1 years) and average expected future years of service (9.7 years). The transitional regulation on the gradual reduction results in an additional obligation of TCHF 5,160. As this regulation will only affect the retirements of the next 4 years, for which the benefits have already been accrued, the additional obligation has been deducted from the past service cost, resulting in a net past service gain of TCHF 12,930. The gain on plan curtailment in the amount of TCHF 17,305 has been offset against the unrecognised actuarial losses.
27
(80)
–
–
(724)
(7)
(811)
–
(529)
–
–
(14)
(543)
Change in scope of consolidation
–
–
1,800
20,419
–
22,219
(44)
–
(5)
–
(161)
(210)
3,564
46
5,608
27,455
2,428
39,101
–
–
–
8,873
–
8,873
Total as at 31.12.2010 of which non-current
The provisions for restoration and remediation relate to future restoration costs of real estate, primarily gravel pits after they have been fully exploited. Provisions for restoration and remediation were reduced by CHF 4.3 million in 2011 due to planned projects, and recognised in the income statement.
–
Reversed
Foreign exchange differences
The provisions for litigation mainly relate to litigation affecting inactive companies.
52
31.12.2010 Increase
The onerous contracts relate to rental guarantees. They generally extend over a period of two to three years. In 2011 and 2010 Implenia did not grant its customers any new rental guarantees. In one case in 2010, the provision for rental guarantees was reduced.
With the acquisition of Sulzer Immobilien AG, Winterthur, Implenia assumed provisions in the amount of CHF 22.2 million (see 2.3 Scope of consolidation). Service guarantees concern completed projects. Related costs tend to be payable within two to five years.
Pension plans
Pension foundation The largest pension plan (according to IFRS a defined benefit plan) is in Switzerland. The plan is financed by contributions from both the employer and employees. The plan takes the form of an independent foundation.
Detailed information about the pension plans are shown below.
228–229
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
31.12.2011
31.12.2010
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
12,411
5,177
1,138,224
1,149,830
(21,957)
(27,345)
Employer contributions
35,065
34,579
Total
25,519
12,411
Pension assets recognised in the balance sheet As at 1.1. Pension expenses (income)
Market value of plan assets As at 1.1.
39,308
40,214
Actuarial gains / (losses)
(31,206)
(18,328)
Employer contributions
35,065
34,580
Employee contributions
29,990
30,540
(94,230)
(98,612)
1,117,151
1,138,224
Expected return on plan assets
Benefits deposited / (paid)
2011
2010
CHF 1,000
CHF 1,000
25,192
20,537
31.12.2011
31.12.2010
(12,930)
–
%
%
9,437
4,997
(39,308)
(40,214)
Interest cost
39,566
42,025
17.6%
Total
21,957
27,345
Total
Expenses recognised in the income statement Current service cost Past service cost / (gain) Amortisation of unrecognised actuarial gains and losses Expected return on plan assets
The actual return on plan assets in 2011 was CHF 8.1 million (2010: CHF 21.9 million). 31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
Funded status / recognition in balance sheet Market value of plan assets
1,117,151
1,138,224
Defined benefit obligations
(1,259,129)
(1,346,324)
Surplus / (underfunding)
(141,978)
(208,100)
167,497
220,511
25,519
12,411
Unrecognised actuarial losses / (gains) Pension assets recognised in the balance sheet
Detailed information on the assets of the pension plan and the defined benefit obligations is shown below.
Breakdown of plan assets Real estate
17.9%
Swiss equities
11.0%
11.2%
Foreign equities
16.4%
17.5%
Swiss bonds
33.3%
33.7%
Foreign bonds
17.2%
16.2%
4.2%
3.8%
Cash and cash equivalents
The plan assets include debt instruments of CHF 3.9 million (2010: none) of Implenia AG, but no equity instruments (2010: none). Furthermore, the pension fund assets include real estate used by Implenia worth CHF 25.0 million (2010: CHF 21.8 million).
230–231
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
1,346,324
1,326,694
Defined benefit obligations As at 1.1.
25,192
20,537
Past service cost / (gain)
(12,930)
–
Plan curtailment
(17,305)
–
Current service cost
Interest cost
39,566
42,025
Employee contributions
29,990
30,540
Actuarial losses / (gains)
(57,478)
25,140
Benefits deposited / (paid)
(94,230)
(98,612)
1,259,129
1,346,324
Total
The estimated employer contributions for 2012 amount to CHF 35.3 million (2011: CHF 34.5 million).
31.12.2011
31.12.2010
Actuarial assumptions Discount rate
2.50%
3.00%
Expected return on plan assets
3.50%
3.50%
Expected salary increase
1.25%
1.25%
Inflation
1.25%
1.25%
Future pension increase
0.00%
0.00%
BVG 2010
BVG 2005
Mortality table
Multi-year figures
2011
2010
2009
2008
2007
CHFm
CHFm
CHFm
CHFm
CHFm
Market value of plan assets
1,117
1,138
1,150
1,013
1,236
Defined benefit obligations
(1,259)
(1,346)
(1,327)
(1,214)
(1,271)
(142)
(208)
(177)
(200)
(35)
Experience adjustments to plan assets
(31)
(18)
97
(213)
(8)
Experience adjustments to plan liabilities
110
8
(34)
42
–
Surplus / (underfunding)
The Foundation for Flexible Retirement (FAR): a defined contribution plan Implenia’s industrial staff subject to the collective employment agreement may take voluntary early retirement from the age of 60. Bridging benefits are paid between the date of early retirement and normal retirement age by the Foundation for Flexible Retirement in the Construction Industry (FAR), which was established especially for this purpose. FAR, which was created by the SIB and SYNA trade unions and also the Société Suisse des Entrepreneurs, is funded by contributions from employers and employees. FAR benefits are funded through a pay-as-you-go system, so do not qualify for treatment as a defined benefit plan under IAS 19. Consequently, FAR is treated as a multi-employer defined contribution scheme. FAR prepares its accounts in accordance with Swiss pension legislation. On this basis, as at 30 June 2011, FAR had a funding ratio of 119.4% (June 2010: 112.8%). Implenia does not anticipate any payment obligations beyond the contributions initially planned. In 2011, Implenia paid FAR contributions totalling CHF 11.3 million (2010: CHF 11.1 million).
232–233
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
28
Deferred tax assets and liabilities Work in progress
Raw materials
Property, plant and equipment
Intangible assets
Pension assets
Provisions
Other items
Tax loss carryforwards
Total
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
31.12.2011 –
–
–
–
–
–
–
1,610
1,610
Deferred tax liabilities as at 1.1.2011
(10,765)
(10,982)
(5,430)
(737)
(2,643)
(10,101)
(7,292)
–
(47,950)
Net deferred tax as at 1.1.2011
(10,765)
(10,982)
(5,430)
(737)
(2,643)
(10,101)
(7,292)
1,610
(46,340)
(799)
1,567
(66)
538
(3,592)
(3,729)
(656)
(1,088)
(7,825)
–
–
–
–
–
–
(31)
–
(31)
(1,519)
11
143
–
–
19
(1,549)
121
(2,774)
Deferred tax assets as at 1.1.2011
Credited / (debited) to the income statement Credited / (debited) directly to equity Change in scope of consolidation Foreign exchange differences Net deferred tax as at 31.12.2011 Deferred tax assets as at 31.12.2011 Deferred tax liabilities as at 31.12.2011
(65)
–
6
–
–
–
(63)
64
(58)
(13,148)
(9,404)
(5,347)
(199)
(6,235)
(13,811)
(9,591)
707
(57,028)
–
–
7
–
–
–
–
707
714
(13,148)
(9,404)
(5,354)
(199)
(6,235)
(13,811)
(9,591)
–
(57,742)
Work in progress
Raw materials
Property, plant and equipment
Intangible assets
Pension assets
Provisions
Other items
Tax loss carryforwards
Total
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
31.12.2010 –
–
–
–
–
–
–
2,495
2,495
Deferred tax liabilities as at 1.1.2010
Deferred tax assets as at 1.1.2010
(10,525)
(1,158)
(5,029)
(1,222)
(1,074)
(5,217)
(6,074)
–
(30,299)
Net deferred tax as at 1.1.2010
(10,525)
(1,158)
(5,029)
(1,222)
(1,074)
(5,217)
(6,074)
2,495
(27,804)
(240)
1,499
(401)
485
(1,569)
(1,087)
(1,218)
(885)
(3,416)
–
(11,323)
–
–
–
(3,797)
–
–
(15,120)
Net deferred tax as at 31.12.2010
(10,765)
(10,982)
(5,430)
(737)
(2,643)
(10,101)
(7,292)
1,610
(46,340)
Deferred tax assets as at 31.12.2010
–
–
–
–
–
–
–
1,610
1,610
(10,765)
(10,982)
(5,430)
(737)
(2,643)
(10,101)
(7,292)
–
(47,950)
Credited / (debited) to the income statement Change in scope of consolidation
Deferred tax liabilities as at 31.12.2010
234–235
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
29
Permanent differences for which no deferred taxes have been recognised:
Investments Goodwill
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
207,177
225,490
85,697
69,193
Equity
29.1 Changes in share capital The 2011 General Meeting approved a par value repayment of CHF 0.90 per share, resulting in a total payment of CHF 16.6 million (2010: par value repayment of CHF 0.70). The share capital available for the par value repayment is equal to the share capital of Implenia AG, Dietlikon. The par value repayment made was determined in accordance with the provisions of the Swiss Code of Obligations.
29.2 Sale and use of treasury shares
Unused tax loss carryforwards by maturity: Total Not capitalised
Capitalised
Capitalised
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
CHF 1,000
1 year
–
–
–
–
–
–
2 years
–
–
–
–
–
–
31.12.2009
2010
31.12.2010
2011
31.12.2011
3 years
–
–
–
–
4,395
4,395
No. of shares
No. of shares
No. of shares
No. of shares
No. of shares
4 years
–
–
–
1
8
9
5 years
–
–
–
–
–
–
More than 5 years
107,737
3,435
111,172
102,821
3,595
106,416
18,472,000
–
18,472,000
–
18,472,000
Total
107,737
3,435
111,172
102,822
7,998
110,820
31.12.2011
Total
In total, 398,812 shares with a carrying amount of CHF 11.5 million (2010: 2,085,727 shares with a carrying amount of CHF 54.5 million) were sold or used for profit sharing schemes during the course of 2011. The resulting loss of CHF 1.3 million (2010: gain CHF 5.7 million) was taken directly to capital reserves.
Not capitalised
31.12.2010
29.3 Outstanding shares Changes
Total number of Implenia AG shares Shares reserved for share-based payments Unreserved treasury shares
Tax loss carryforwards are capitalised when it is likely that taxable profits will be earned in future. The noncapitalised tax loss carryforwards mainly affect subsidiaries outside Switzerland which no longer carry out any operational activities.
Total treasury shares Total shares outstanding
Changes
80,000
(80,000)
–
–
–
1,446,184
(1,235,167)
211,017
(32,011)
179,006
1,526,184
(1,315,167)
211,017
(32,011)
179,006
16,945,816
1,315,167
18,260,983
32,011
18,292,994
As part of the placement of the block of shares in Implenia held by Laxey, Implenia acquired CHF 30 million of its own shares (6.5% of share capital) on 26 November 2009. A large portion of this block of shares was sold to various investors in 2010. All shares are subscribed and fully paid up. As at 31 December 2011, all shares have voting rights and qualify for dividends, with the exception of 179,006 treasury shares (2010: 211,017 treasury shares).
236–237
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
Changes
32
Changes
2010
31.12.2010
2011
31.12.2011
31.12.2011
31.12.2010
Par value of shares CHF 1,000
Par value of shares CHF 1,000
Par value of shares CHF 1,000
Par value of shares CHF 1,000
Par value of shares CHF 1,000
CHFm
CHFm
Share capital
64,652
(12,930)
51,722
(16,625)
35,097
Treasury shares
(5,342)
4,751
(591)
251
(340)
Total share capital outstanding
59,310
(8,180)
51,131
(16,374)
34,757
As at 31 December 2011, the par value of a share amounted to CHF 1.90 (31.12.2010: CHF 2.80).
30
Contingent liabilities
31.12.2009
As at 1.1
216.8
271.3
Change
(41.6)
(54.5)
Total
175.2
216.8
Implenia’s contingent liabilities relate primarily to outstanding guarantees (tender guarantees, warranties and performance bonds) for ongoing projects for own account, projects in joint ventures and tax disputes / litigation. Implenia Bau AG, along with many other construction companies in the regional market for road building and civil engineering in the canton of Aargau, was the subject of an investigation launched in 2009 by the Federal Competition Commission. On 16 December 2011, the Competition Commission imposed a financial penalty of TCHF 591. The penalty is included in accrued expenses as at 31 December 2011 (2010: no provision).
Earnings per share 31.12.2011
31.12.2010
60,264
51,470
31.12.2011
31.12.2010
Number of shares outstanding
18,292,994
18,260,983
CHFm
CHFm
Weighted average number of shares outstanding
18,233,119
17,880,142
46.8
17.6
Data for calculating earnings per share Consolidated profit attributable to shareholders of Implenia AG in CHF 1,000
Contractual commitments for capital expenditure
Basic earnings per share
CHF 3.31
CHF 2.88
Diluted earnings per share
CHF 3.31
CHF 2.88
Undiluted earnings per share (EPS) are calculated by dividing the net income attributable to shareholders of Implenia AG by the weighted average number of shares outstanding during the period. The average number of treasury shares held and acquired by the Group is deducted from the number of shares outstanding.
31
Distribution of reserves from capital contributions / par value repayment
A par value repayment of CHF 0.90 per share was made for the 2010 financial year (2009: CHF 0.70 per share). The Board of Directors will propose a tax-exempt distribution of reserves from capital contributions of CHF 1.10 per share for the 2011 financial year to the General Meeting to be held on 4 April 2012. The balance sheet presented as at 31 December 2011 does not reflect the proposed distribution for 2011.
Real estate transactions Property, plant and equipment Total
3.9
–
50.7
17.6
238–239
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
33
Related party disclosures
The following transactions took place between the Group and associates / joint ventures / staff pension plans and other related parties.
According to the shareholder register, the following parties held more than 3% of share capital on the reporting date:
2011
2010
CHF 1,000
CHF 1,000
224,662
253,928
23,531
19,132
293
5
Joint ventures
20,668
21,714
Associates
39,021
39,861
1,268
1,043
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
39,734
56,254
3,280
4,692
62
–
Joint ventures
4,933
2,368
Associates
9,818
9,171
9
1
31.12.2011
31.12.2010
%
%
Parmino Holding AG
16.3%
16.0%
Associates
Maag Rudolf
10.8%
10.8%
Other related parties
Ammann Group
8.4%
8.4%
Chase Nominees Ltd.
4.7%
5.4%
EGS Beteiligungen AG
4.5%
8.4%
Sales to related parties Joint ventures
Purchases from related parties
Other related parties
Receivables from related parties Joint ventures Associates Other related parties Payables to related parties
Other related parties
240–241
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
Key management personnel
34
Members of the Board of Directors of Implenia AG receive annual compensation for their activities, and additional compensation for serving on board committees. Total compensation paid to the non-executive Board of Directors (excluding the Chairman) in 2011 was TCHF 1,538 (2010: TCHF 1,129).
Free cash flow
Implenia defines free cash flow as cash flow from operating activities, less acquisitions or disposals of non-current assets. The following table provides an overview of free cash flow: 2011
2010
CHF 1,000
CHF 1,000
Members of the Executive Committee of Implenia AG receive compensation comprising a fixed annual salary, variable compensation and reimbursement of expenses. The Group pays social security contributions on the above compensation and pension fund contributions. Members of the Executive Committee also participate in the employee share plan. The terms and conditions are disclosed in Note 2.9.
Free cash flow Cash flow from operating activities
102,449
138,516
Total compensation of TCHF 2,810 was paid to former Members of the Executive Committee (2010: TCHF 1,719).
Investments in non-current assets
(47,315)
(45,967)
Short-term benefits Post-employment benefits
2011
2010
CHF 1,000
CHF 1,000
6,191
5,445
589
413
216
–
Share-based payments
1,328
2,455
Total
8,324
8,313
Payments on termination of employment
Disposals of non-current assets
24,346
14,515
Free cash flow before acquisition of subsidiaries
79,480
107,064
(12,169)
(67,144)
67,311
39,920
Acquisition of subsidiaries Free cash flow after acquisition of subsidiaries
Free cash flow is not a financial indicator defined under IFRS and should not be interpreted as such. Free cash flow is not equivalent to cash flow from operating activities as defined under IFRS.
35
Events after the balance sheet date
The Board of Directors of Implenia AG approved these consolidated financial statements on 5 March 2012. On the same date, the Board of Directors proposed a tax-exempt distribution of reserves from capital contributions of CHF 1.10 per share, which will be submitted to the General Meeting to be held on 4 April 2012 for approval. If the resolution is approved, the total amount of the distribution will be CHF 20.3 million.
36
Foreign exchange rates Average rate
Closing rate
2011
2010
31.12.2011
31.12.2010
European Union
1 EUR
CHF 1.23
CHF 1.36
CHF 1.22
CHF 1.25
Ivory Coast / Mali
100 XOF
CHF 0.19
CHF 0.21
CHF 0.19
CHF 0.19
Norway
100 NOK
CHF 15.43
n.a.
CHF 15.68
n.a.
United Arab Emirates
100 AED
CHF 24.16
CHF 27.70
CHF 25.59
CHF 25.49
1 USD
CHF 0.89
CHF 1.02
CHF 0.94
CHF 0.94
USA
242–243
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
37
Significant fully consolidated companies
Name
Développements transfrontaliers SA Gravière de La Claie-aux-Moines S.A. Implenia AS (formerly Betonmast Anlegg AS) Implenia (Tessin) AG Implenia Bau AG Implenia Bau GmbH Implenia Cyprus Ltd. Implenia Development AG Implenia Generalunternehmung AG Implenia Global Solutions AG Implenia Holding GmbH Implenia Immobilien AG Implenia Italia S.p.A. Implenia Management AG Implenia Miljøsanering AS Implenia Österreich GmbH Lindcon AS Norbridge AS Reprojet AG Reuss Engineering AG Russian Land Implenia Ltd. SAPA, Société Anonyme de Produits Asphaltiques Sisag AG Socarco Bénin Sàrl Socarco Burkina Sàrl Socarco Mali Sàrl Tetrag Automation AG Trachsel AG Tunnelteknikk AS Zschokke Construction Sàrl Zschokke France SA
Shareholding Registered office
100% 66.67% 80.79% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 90.08% 100% 65% 51% 100% 100% 100% 75% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Lyon Savigny Oslo Bioggio Geneva Rümmingen Nicosia Dietlikon Basel Dietlikon Rümmingen Dietlikon Basiliano Dietlikon Oslo Vienna Oslo Stjørdal Zurich Dietlikon Moscow Satigny Abidjan Cotonou Ouagadougou Bamako Dietlikon Heimberg Eidsnes Lyon Lyon
Country
Currency
F CH N CH CH D CY CH CH CH D CH I CH N A N N CH CH RU CH CI BJ BF RMM CH CH N F F
EUR CHF NOK CHF CHF EUR EUR CHF CHF CHF EUR CHF EUR CHF NOK EUR NOK NOK CHF CHF RUB CHF XOF XOF XOF XOF CHF CHF NOK EUR EUR
Capital Segment
14,663,800 1,500,000 4,095,432 150,000 40,000,000 2,556,459 3,001 30,000,000 20,000,000 100,000 3,067,751 30,600,000 250,000 500,000 3,144,000 35,000 100,000 3,000,000 100,000 100,000 70,000,000 500,000 492,000,000 1,000,000 10,000,000 100,000,000 100,000 100,000 2,800,000 76,225 914,694
Miscellaneous and Holding Company Infrastructure Construction Tunnelling Infrastructure Construction Infrastructure Construction + Tunnelling Infrastructure Construction Prime Buildings Project Development General Contracting / Services Prime Buildings Infrastructure Construction Project Development Prime Buildings Miscellaneous and Holding Company Tunnelling Tunnelling Tunnelling Tunnelling Infrastructure Construction General Contracting / Services Prime Buildings Infrastructure Construction Infrastructure Construction Infrastructure Construction Infrastructure Construction Infrastructure Construction General Contracting / Services Infrastructure Construction Tunnelling Infrastructure Construction Miscellaneous and Holding Company
Held by
Implenia Development AG Implenia AG Implenia Bau AG Implenia AG Implenia AG Implenia Holding GmbH Implenia AG Implenia AG Implenia AG Implenia AG Implenia Immobilien AG Implenia AG Implenia Bau AG Implenia AG Implenia AS Implenia AG Implenia AS Implenia AS Implenia AG Implenia AG Russian Land Implenia Holding Ltd. Implenia AG Implenia AG SISAG SISAG SISAG Implenia AG Implenia AG Implenia AS Zschokke France SA Implenia AG
244–245
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Notes to the consolidated financial statements of Implenia
38
Significant associates
Name
ARGE Deponie Schwanental
Shareholding Registered office
37.0% Eglisau
Country
Currency
CH
CHF
Capital
–
Name
Shareholding Registered office
Reproad AG
33.3% Bremgarten
Country
Currency
CH
CHF
Capital
1,500,000
Argo Mineral AG
50.0% Aarau
CH
CHF
300,000
Sebal (sp)
22.0% Lyss-Büttenberg
CH
CHF
–
Argobit AG
40.0% Schafisheim
CH
CHF
1,200,000
Sebal Lyss AG
22.0% Lyss
CH
CHF
500,000
Asfatop AG
50.0% Unterengstringen
CH
CHF
1,000,000
Associés Poste Enrobage en Commun (APEC) SA
Seval – Société d’Enrobage du Valais central (sp)
83.0% Vétroz
CH
CHF
–
20.0% Hauterive
CH
CHF
300,000
Bawag, Belagsaufbereitungsanlage Wimmis AG
SFR Société Fribourgeoise de Recyclage SA
21.0% Hauterive
CH
CHF
1,200,000
24.0% Wimmis
CH
CHF
100,000
Siseg SA
21.1% Geneva
CH
CHF
500,000
Belagswerk Rinau AG
25.0% Kaiseraugst
CH
CHF
1,000,000
Société Coopérative Les Terrasses
45.1% Versoix
CH
CHF
775,500
Bewo Belagswerk Oberwallis (sp)
25.0% Niedergesteln
CH
CHF
1,500,000
Bioasfa SA
50.0% Bioggio
CH
CHF
900,000
Société de recyclage de matériaux pierreux (sp)
40.0% Savigny
CH
CHF
95,443
Société d’exploitation du Mégastore d’Archamps – SEMA (sp)
30.0% Archamps
F
EUR
37,000
Société Romande de Recyclage – SRREC (sp)
37.5% Satigny
CH
CHF
–
Tapidrance (sp)
60.0% Martigny
CH
CHF
1,000,000 1,000,000
Bipp Asphalt AG
27.5% Niederbipp
CH
CHF
1,000,000
BRZ Belags- und Recycling-Zentrum (sp)
33.3% Horw
CH
CHF
1,500,000
Catram AG
24.0% Chur
CH
CHF
1,000,000
Deponie Vorderland AG
33.3% Rehetobel
CH
CHF
150,000
Garage-Parc Montreux Gare SA
26.0% Montreux
CH
CHF
2,050,000
GU Kies AG
33.3% Schaffhausen
CH
CHF
450,000
Holcim Bétondrance SA
46.0% Martigny
CH
CHF
300,000
Kieswerk Oldis AG
26.4% Haldenstein
CH
CHF
1,200,000
Léchire S.A.
33.0% Fribourg
CH
CHF
100,000
Microlog SPA
50.0% San Giorgio
I
EUR
500,000
MIFAG Mischgutwerk Frauenfeld AG
10.0% Frauenfeld
CH
CHF
600,000
MOAG Baustoffe Holding AG
14.3% Mörschwil
CH
CHF
300,000
Mobival (sp)
26.0% Massongex
CH
CHF
–
Parking Port d’Ouchy S.A.
24.0% Lausanne
CH
CHF
6,986,000
Prébit, Centre d’enrobage (sp)
25.0% Marin-Epagnier
CH
CHF
500,000
Pro Quarta (sp)
42.0% Alvaneu
CH
CHF
500,000
Remora AG
18.3% St. Gallen
CH
CHF
300,000
(sp) simple partnership
Urner Belagszentrum (UBZ) (sp)
50.0% Flüelen
CH
CHF
Valbéton (sp)
50.6% Sion
CH
CHF
100,000
Valver (sp)
27.9% Martigny
CH
CHF
1,729,936
Wohnpark an der Kander GmbH
40.0% Rümmingen
D
EUR
204,517
wsb AG
50.0% Rafz
CH
CHF
500,000
(sp) simple partnership
Associates are recognised according to the equity method (see Note 2.15). Although the stakes held in Seval, Tapidrance and Valbéton are higher than 50%, these companies are accounted for as associates and the equity method is applied as Implenia does not have control over these companies. The composition of the Executive Boards of the companies named does not allow Implenia to control these companies. By contrast, some companies in which Implenia holds a stake of less than 20% are recognised as associates as Implenia exercises significant influence over them.
246–247
CONSOLIDATED FINANCIAL STATEMENTS OF THE IMPLENIA GROUP
Report of the statutory auditor on the consolidated financial statements
Report of the statutory auditor to the Annual General Meeting of Implenia AG, Dietlikon As statutory auditor, we have audited the consolidated financial statements of Implenia AG, which comprise the income statement, statement of comprehensive income, balance sheet, cash flow statement, statement of changes in equity, and notes (pages 156 to 245) for the year ended 31 December 2011.
Board of Directors’ responsibility The Board of Directors is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with International Financial Reporting Standards (IFRS) and the requirements of Swiss law. This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. The Board of Directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.
Report on other legal requirements We confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and independence (article 728 CO and article 11 AOA) and that there are no circumstances incompatible with our independence. In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists which has been designed for the preparation of consolidated financial statements according to the instructions of the Board of Directors. We recommend that the consolidated financial statements submitted to you be approved.
PricewaterhouseCoopers AG
Auditor’s responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with Swiss law, Swiss Auditing Standards as well as the International Standards on Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the consolidated financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control system. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion In our opinion, the consolidated financial statements for the year ended 31 December 2011 give a true and fair view of the financial position, the results of operations and the cash flows in accordance with International Financial Reporting Standards (IFRS) and comply with Swiss law.
Willy Wenger Audit expert Auditor in charge
Zurich, 5 March 2012
PhD Bendik Höhn Audit expert
248–249
STATUTORY FINANCIAL STATEMENTS OF IMPLENIA AG
Income statements
Balance sheets
1.1. – 31.12. 2011
1.1. – 31.12. 2010
CHF 1,000
CHF 1,000
Notes
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
179,356
174,517
ASSETS INCOME Income from investments Income from sale of investments Release of value adjustments and provisions Financial income Other income Total
Cash and cash equivalents 25,453
25,310
1,367
7,522
3,013
3,978
17,841
15,044
2,123
3,104
49,797
54,958
EXPENSES 5,877
6,172
23,310
27,103
210
324
Profit for the year
20,400
21,359
Total
49,797
54,958
Administration expenses Financial expenses Taxes
4,460
6,292
215,921
221,741
Other receivables
1,740
4,432
Prepaid expenses and accrued income
3,600
5,780
405,077
412,762 265,512
Treasury shares
1
Receivables from Group companies
Total current assets Investments in Group companies
2
265,512
Investments in associates and other investments
2
1,555
1,556
–
2,000
Other financial assets Total non-current assets
267,067
269,068
Total assets
672,144
681,830
188,971
199,994
EQUITY AND LIABILITIES Payables to Group companies Trade payables
195
91
Other liabilities
5,194
8,274
Prepaid income and accrued expenses Total current liabilities Bond issue
7
Total non-current liabilities Share capital
3
5,681
5,144
200,041
213,503
200,000
200,000
200,000
200,000
35,097
51,721
16,185
13,686
Statutory reserves – General reserves – Reserves for treasury shares – Reserves from capital contributions Free reserves
4
4,460
6,292
59,153
40,873
–
20,780
136,808
113,616
Retained earnings – Profit carried forward
20,400
21,359
Total equity
272,103
268,327
Total equity and liabilities
672,144
681,830
– Profit for the year
250–251
STATUTORY FINANCIAL STATEMENTS OF IMPLENIA AG
Notes to the statutory financial statements
1
Treasury shares (Implenia AG)
Shareholders holding more than 3% of the share capital as at 31 December: 2011
2011
2010
Number
CHF 1,000
CHF 1,000
As at 1.1
211,017
6,292
38,890
Purchase
366,801
9,891
22,312
(398,812)
(11,491)
(54,514)
–
(232)
(396)
179,006
4,460
6,292
Sale and use for employees, Board of Directors Par value repayment As at 31.12
2
31.12.2011
31.12.2010
%
%
Parmino Holding AG
16.3%
16.0%
Maag Rudolf
10.8%
10.8%
Ammann Group
8.4%
8.4%
Chase Nominees Ltd.
4.7%
5.4%
EGS Beteiligungen AG
4.5%
8.4%
Investments
Group companies (see Note 10) Associates and other investments
3
According to share register
2011
2010
CHF 1,000
CHF 1,000
265,512
265,512
1,555
1,556
4
Reserves from capital contributions
With a view to a possible distribution, the “Reserves from capital contributions” item is now disclosed separately as part of the statutory reserves. Confirmation of such was issued by the federal tax authorities on 25 January 2012. Under the capital contribution principle in effect since 1 January 2011, distributions from these reserves are for individuals in principle exempt from Swiss income and withholding tax.
Share capital
The articles of association provide for a conditional capital increase in the maximum amount of CHF 17,548,400 (9,236,000 fully paid-up registered shares at CHF 1.90 each). To date, there have been no conversion of conditional capital. The General Meeting of 19 April 2011 approved a partial repayment of CHF 0.90 of the par value of each share. The share capital was reduced by CHF 16.6 million to CHF 35.1 million.
5
Hidden reserves
Net release pursuant to Art. 663b CO
6
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
3,013
3,710
31.12.2011
31.12.2010
CHF 1,000
CHF 1,000
24,346
19,600
p.m.
p.m.
Contingent liabilities
Guarantees and contingent liabilities Security for joint liability regarding the levying of VAT for the Group
As part of a syndicated loan agreement signed on 12 August 2009, Implenia AG issued a guarantee in the amount of CHF 660 million in favour of the bank consortium for the liabilities of Group companies.
252–253
STATUTORY FINANCIAL STATEMENTS OF IMPLENIA AG
Notes to the statutory financial statements
7
Bond issue
On 12 May 2010, Implenia AG, Dietlikon issued a bond in the amount of CHF 200 million. The bond pays interest of 3.125%, has a term of six years and matures on 12 May 2016. A bank consortium comprising Zürcher Kantonalbank and UBS AG placed the bond at an issue price of 100.269%. The bond is traded on the SIX Swiss Exchange (security number 11219351).
8
Risk assessment
Group-wide risk assessment, which facilitates the early identification and evaluation of risks, as well as the implementation of appropriate risk-reduction measures, is carried out every half-year and focuses mainly on project risks and financial risks. Using a bottom-up process based on risk maps for each project and unit, the results of all the individual risk and opportunity assessments are consolidated. As part of the accounting and control process, Group Risk Management reports twice a year to the Executive Committee, the Audit Committee and the Board of Directors.
9 Compensation paid to members of the Board of Directors and members of the Executive Committee 9.1 Remuneration paid to serving members of governing bodies Total remuneration paid to members of the Board of Directors and the Executive Committee in 2011 amounted to TCHF 8,324 (2010: TCHF 8,313), including shares assigned, severance payments, social security contributions and additional fees.
Executive Committee 2011 Fixed remuneration
One-time remuneration
Variable remuneration
CHF 1,000 CHF 1,000 CHF 1,000
Beat Fellmann Other members of the Executive Committee in office
Shares assigned
Social security expenses
1
500
–
175
3,500
83
193
951
1,407
–
504
23,331
552
562
3,025
680
100
125
27,500
672
315
1,892
Former members of the Executive Committee – Hanspeter Fässler – Peter Bodmer Total
Total
Number CHF 1,000 CHF 1,000 CHF 1,000
– 557
–
161
–
–
200
918
3,144
100
965
54,331
1,307
1,270
6,786
Hanspeter Fässler was CEO of Implenia from 1 January 2011 to 30 September 2011. As at 31 December 2011, Hanspeter Fässler has left Implenia. As part of his severance package, Hanspeter Fässler will receive salary payments of TCHF 216, including social security contributions, which are included in the above amounts. For the period from 1 January 2011 to 30 September 2011, Anton Affentranger was the Non-executive Chairman of the Board of Directors. On 1 October 2011, he became CEO of Implenia and retired from the Board of Directors on the same date.
Executive Committee 2010 Fixed remuneration
One-time remuneration
Variable remuneration
CHF 1,000 CHF 1,000 CHF 1,000
Total remuneration paid to serving members of the Executive Committee is shown in the table below. Hanspeter Fässler Other members of the Executive Committee in office
Shares assigned
Social security expenses
1
300
100
93
14,338
449
144
1,086
1,873
–
813
28,523
911
782
4,379
450
–
32,400
945 –
63
324
75,261
2,305
989
7,184
Former members of the Executive Committee – Anton Affentranger – Others Total
Total
Number CHF 1,000 CHF 1,000 CHF 1,000
– 208
–
53
2,831
100
959
1 Implenia Ltd shares, security number 00238 6855, nominal value CHF 1.90 (2010: CHF 2.80)
1,395
254–255
STATUTORY FINANCIAL STATEMENTS OF IMPLENIA AG
Notes to the statutory financial statements
For the period from 1 January 2010 to 31 August 2010, Anton Affentranger was Executive Chairman of the Board of Directors and CEO of Implenia, and he was a member of the Executive Committee until 30 September 2010. Hanspeter Fässler joined the company on 1 July 2010 and became CEO on 1 September 2010. Anton Affentranger became the Non-executive Chairman of the Board of Directors on 1 October 2010. The variable component of remuneration is paid out in cash or shares in the following year.
Anton Affentranger, Chairman
Anton Affentranger, Chairman (until 30.09.2011) Markus Dennler, Chairman Hans-Beat Gürtler, Vice-Chairman Patrick Hünerwadel, Member
CHF 1,000
CHF 1,000
135 120 70 90
80 90 85 60
Shares assigned1) Number
1,834 917 688 –
CHF 1,000
52 26 20 –
98
89
852
24
26
237
James Lionel Cohen, Member
15
6
–
–
3
24
Claudio Generali, Member
11
11
639
18
4
44
Ian Andrew Goldin, Member
15
6
–
–
3
24
299
Hans-Beat Gürtler, Member
40
32
–
–
10
82
266
Urs Häner, Member
11
5
639
18
3
37
197
Patrick Hünerwadel, Member
75
46
–
–
17
138
171
Toni Wicki, Member
78
56
852
24
19
177
55
70
–
–
17
142
Theophil Schlatter, Member (since 01.04.2011)
45
45
–
–
12
102
100
60
741
21
23
204
Philippe Zoelly, Member Total
CHF 1,000
242
Moritz Leuenberger, Member (since 01.04.2011)
Toni Wicki, Member
CHF 1,000
26
CHF 1,000
21
Total
CHF 1,000
48
CHF 1,000
22
Number
1,703
Total
30
CHF 1,000
27
Social security expenses
32
CHF 1,000
Social security expenses
Shares assigned1
141
Non-executive Board of Directors, 2011 Basic fees
Basic fees
Attendance fees and one-time fees
Markus Dennler, Vice-Chairman
Total remuneration paid to Non-executive Members of the Board of Directors is as follows:
Attendance fees and one-time fees
Non-executive Board of Directors, 2010
60
60
688
20
17
157
675
550
4,868
139
174
1,538
Philippe Zoelly, Member Total
51
41
639
18
14
124
535
319
5,324
150
125
1,129
1 Implenia Ltd shares, security number 00238 6855, nominal value CHF 1.90 (2010: CHF 2.80)
No severance payments were made during 2011 and 2010.
9.2 Remuneration paid to former members of governing bodies Remuneration of TCHF 2,810 (2010: TCHF 1,719) was paid to former members of governing bodies whose term of office has ended.
256–257
STATUTORY FINANCIAL STATEMENTS OF IMPLENIA AG
Notes to the statutory financial statements
9.3 Assignment of shares during the year
Non-executive Board of Directors Number of shares, as at
The number of shares assigned in 2011 to members of the Executive Committee and related persons was 54,331 (2010: 75,261). The number of shares assigned in 2011 to non-executive members of the Board of Directors and related persons was 4,868 (2010: 5,324).
9.4 Shareholdings As at 31 December 2011, the number of shares held by members of the Executive Committee and related persons was 342,675, which represents 1.9% of the share capital (2010: 285,132 or 1.5%). This figure includes any shares acquired in a private capacity.
Members of the Executive Committee (current and former) Number of shares, as at
31.12.2010
2012
2013
2014
216,013
209,179
23,554
34,853
1,834
Beat Fellmann, CFO
17,600
10,600
2,333
8,267
7,000
Luzi Reto Gruber, Head of Industrial Construction Division
23,338
16,890
5,000
7,400
6,448
Arturo Henniger, Head of Infrastructure Construction Division René Zahnd, Head of Real Estate Division
– Peter Bodmer Total
2012
2013
2014
5,201
4,284
977
852
917 688
Markus Dennler, Chairman Hans-Beat Gürtler, ViceChairman
688
–
–
–
Patrick Hünerwadel, Member
1,340
1,340
–
–
–
Moritz Leuenberger, Member
–
–
–
–
–
Theophil Schlatter, Member
1,000
–
–
–
–
Toni Wicki, Member
8,372
7,631
733
852
741
4,216
3,528
733
639
688
20,817
16,783
2,443
2,343
3,034
Philippe Zoelly, Member Total
Implenia AG has no stock-option remuneration scheme.
9.6 Additional fees and remuneration The sum of additional fees and remuneration invoiced in the 2011 financial year by members of the Board of Directors or the Executive Committee and related persons was CHF 0 (2010: CHF 0). 29,828
22,227
6,201
8,605
7,601
4,000
250
–
1,000
3,000
24,338
5,000
–
5,000
19,338
Members of the Executive Committee who left in 2011 – Hanspeter Fässler
31.12.2010
9.5 Options
Shares blocked until
31.12.2011 Anton Affentranger, CEO
Shares blocked until
31.12.2011
27,558
20,986
6,572
7,322
6,572
342,675
285,132
43,660
72,447
51,793
As at 31 December 2011, the number of shares held by non-executive members of the Board of Directors and related persons was 20,817, which represents 0.1% of the share capital (2010: 16,783 or 0.1%). This figure includes any shares acquired in a private capacity.
9.7 Loans to directors and officers No loans have been granted to any members of the Board of Directors or any members of the Executive Committee or related persons.
9.8 Highest total remuneration The member of the Executive Committee with the highest overall remuneration is disclosed in the tables in Note 9.1.
258–259
STATUTORY FINANCIAL STATEMENTS OF IMPLENIA AG
Notes to the statutory financial statements
10
Proposal of the Board of Directors regarding the appropriation of available earnings
Significant shareholdings
Name
Gebr. Ulmer GmbH Gravière de La Claie-aux-Moines S.A. Gust. Stumpf Verwaltungs GmbH & Co KG Implenia (Tessin) AG Implenia Bau AG Implenia Cyprus Ltd. Implenia Development AG Implenia Generalunternehmung AG Implenia Global Solutions AG Implenia Immobilien AG Implenia Management AG Implenia Österreich GmbH Reprojet AG Reuss Engineering AG SAPA, Société Anonyme de Produits Asphaltiques Sisag AG Swiss Overseas Engineering Company Tetrag Automation AG Trachsel AG Zschokke France SA Zschokke Holding Deutschland GmbH
Proposal of the Board of Directors regarding the appropriation of available earnings Shareholding Registered office
Currency
Capital
2011 CHF 1,000
100% 66.67% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Bruchsal (D) Savigny Bruchsal (D) Bioggio Geneva Nicosia (CY) Dietlikon Basel Dietlikon Dietlikon Dietlikon Vienna (A) Zurich Dietlikon
EUR CHF EUR CHF CHF EUR CHF CHF CHF CHF CHF EUR CHF CHF
25,565 1,500,000 511,292 150,000 40,000,000 3,001 30,000,000 20,000,000 100,000 30,600,000 500,000 35,000 100,000 100,000
75% 100% 100% 100% 100% 100% 100%
Satigny Abidjan (CI) Geneva Dietlikon Heimberg Lyon (F) Berlin (D)
CHF XOF CHF CHF CHF EUR EUR
500,000 492,000,000 200,000 100,000 100,000 914,694 3,067,751
Profit carried forward Profit for the year Dissolution from reserves from capital contributions
136,808 20,400 20,122 177,330
The Board of Directors proposes to the General Meeting the following appropriation of available earnings and reserves: Distribution of a dividend of To be carried forward
20,122 157,208 177,330
Total distribution of dividend Of which from reserves from capital contributions Of which from other reserves and available earnings
20,122 (20,122) –
The Board of Directors will propose a tax-exempt distribution of CHF 1.10 per share from the reserves from capital contributions to the General Meeting of 4 April 2012. As of 31 December 2011, the assumed dividend amounted to approximately CHF 20.1 million. The total dividend amount results from multiplying the dividend per share amount with the number of shares outstanding entitled to dividend payment at the dividend record date (13 April 2012). Until the dividend record date, this number of shares can change.
260–261
STATUTORY FINANCIAL STATEMENTS OF IMPLENIA AG
Report of the statutory auditor on the financial statements
Report of the statutory auditor to the Annual General Meeting of Implenia AG, Dietlikon
Report on other legal requirements
As statutory auditor, we have audited the financial statements of Implenia Ltd, which comprise the balance sheet, income statement and notes (pages 248 to 259), for the year ended 31 December 2011.
We confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and independence (article 728 SCO and article 11 AOA) and that there are no circumstances incompatible with our independence.
Board of Directors’ responsibility The Board of Directors is responsible for the preparation of the financial statements in accordance with the requirements of Swiss law and the company’s articles of incorporation. This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or error. The Board of Directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.
In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists which has been designed for the preparation of financial statements according to the instructions of the Board of Directors. We further confirm that the proposed appropriation of available earnings complies with Swiss law and the company’s articles of incorporation. We recommend that the financial statements submitted to you be approved.
Auditor’s responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Swiss law and Swiss Auditing Standards. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control system. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion In our opinion, the financial statements for the year ended 31 December 2011 comply with Swiss law and the company’s articles of incorporation.
PricewaterhouseCoopers AG
Willy Wenger Audit expert Auditor in charge
Zurich, 5 March 2012
PhD Bendik Höhn Audit expert
Locations, contact addresses and terms
Schaffhausen
Augst
La Chaux-de-Fonds
Diessenhofen
Rümmingen (DE)
Kreuzlingen Romanshorn Kradolf/Schönenberg a.d.T. Goldach Bischofszell St. Margrethen Wil St. Gallen Rümlang/Regensd. Algetshausen Lenzburg Liestal Teufen Gossau Dietlikon/ Aarau/Buchs Bühler Zürich/Oerlikon Wallisellen Herisau Delémont Altstätten Oberentfelden Affoltern a.A. Ebnat-Kappel Appenzell Olten Balsthal Jona Moutier Steinhausen Uznach Gams Reiden Solothurn Zug/Cham Pfäffikon/ Buchs SG Freienbach Siebnen Biel/Bienne Gisikon Grabs Inwil Studen Mels Luzern Schwyz Basel
Baden
Neuchâtel
Frauenfeld
Winterthur
Glarus
Hergiswil
Bern
Alpnach
Konolfingen Fribourg
Rafz
Engelberg
Wattenwil
Altdorf Schattdorf
Chur Davos
Spiez
Interlaken
Andermatt
Zweisimmen Echandens
St. Moritz
Renens
Sierre Genève/Onex
Vétroz
Scuol Zernez
Meiringen
Visp
Sion
Martigny Bioggio Lugano
For details on individual locations, visit www.implenia.com
Contacts Contact for investors Beat Fellmann, Head of Corporate Center and CFO Phone +41 44 805 45 00 – Fax +41 44 805 45 01 – E-mail beat.fellmann@implenia.com Contact for the media Philipp Bircher, Head of Communications Phone +41 44 805 45 23 – Fax +41 44 805 45 20 – E-mail philipp.bircher@implenia.com
Key dates Media and analysts’ conference on the 2012 half-year result – 30 August 2012 Media and analysts’ conference on the 2012 annual result – 26 February 2013