BELGIUM, March 28, 2003 (PRIMEZONE) -- Solvay Group (Other OTC:SVYSY):
- Very strong balance sheet (net debt to equity ratio of 28%)
- Net dividend of EUR 1.80 per share, up EUR 0.10 compared to 2001
Final 2002 results
The Solvay Group has confirmed the preliminary consolidated results released on February 11, 2003, finishing the year 2002 with net current earnings of EUR 496 million, up 23% compared to the EUR 403 million of 2001. The balance of extraordinary items being negligible, the Group's net earnings are consequently also equal to EUR 496 million in 2002. The earnings of the parent company, SOLVAY S.A. reached EUR 220 million in 2002, compared to EUR 202 million in 2001.
Outlook
As indicated on February 11, 2003, the geopolitical context limits the visibility for 2003. It will be necessary to remain vigilant. The growing contribution of Pharmaceuticals and Specialties products, combined with the strengthening of competitiveness in Essential Products, should permit the Solvay Group to be well positioned to face future challenges.
2002 Balance Sheet
Despite the acquisition of Ausimont (EUR 1.3 billion), financed by EUR 800 million of preferred shares, which also explains the increase in working capital of EUR 400 million, the Group's net indebtedness in 2002 (EUR 1,053 million) remained stable from 2001, thanks to generation of record cash flow (EUR 1.1 billion). The financial situation of the Group is very healthy, with a net debt to equity ratio of 28%. Shareholders' equity (EUR 3,796 million at the end of 2002 compared to EUR 3,939 million at the end of 2001) and fixed assets (EUR 5,532 million at the end of 2002 compared to EUR 6,223 million at the end of 2001) declined primarily because of variations in the exchange rate for the US dollar and various Mercosur currencies.
Dividend
The Board of Directors has decided to propose to the Annual General Meeting of Shareholders on June 5, 2003 the payment of a net dividend of EUR 1.80 per share, up 5.9 per cent from the net dividend of EUR 1.70 for 2001. Given the interim dividend of EUR 0.70 per share paid on January 13, 2003, a balance of EUR 1.10 per share will be paid on June 12, 2003 (coupon N'72).
This increase reflects the dividend policy of the Group, which is to increase the dividend whenever possible and, if possible, never to decrease it. For 20 years, the Group has never reduced its dividend.
Results per share
(excluding minority interests) 2002/2001 USD/SHARE (1)
EUR/SHARE 2001 2002 Var. % 2002
Net current earnings 4.72 5.53 17% 5.8
Net earnings 4.72 5.53 17% 5.8
Net dividend 1.7 1.8 5.90% 1.89
Gross dividend 2.27 2.4 5.90% 2.52
Cash flow 10.82 12.63 17% 13.25
Number of
shares (000) 84,445 84,601 n.s. 84,601
(1) EUR = 1.0487 USD (31 December 2002)
The Auditor gave an unqualified opinion on the annual consolidated financial statements and confirmed that the accounting information contained in this release accurately reflects such consolidated financial statements.
SOLVAY GROUP - FINAL CONSOLIDATED RESULTS
SOLVAY GROUP
MILLIONS OF EUR 2002 / 2001 (EUR) MUSD(1)
(including minority interests)
2001 2002 Var% 2002
Sales 8725 7918 -9% 8304
Gross margin 2444 2643 8% 2772
EBIT 628 772 23% 810
Net debt expense -90 -68 -24% -71
Current taxes -135 -170 26% -178
Results recorded according
to the equity method(2) - -38 n.s. -40
Net current
earnings(3) 403 496 23% 520
Net extraordinary
items 0 0 - 0
Net earnings 403 496 23% 520
Minority interests 5 28 n.s. 29
Solvay's share of
earnings 398 468 17% 491
Depreciation 522 604 16% 633
Cash flow 925 1100 19% 1153
Capital
expenditures 2627(4) 625 n.s. 655
Research and
development 341 397 16% 416
(1) 1 EUR = 1.0487 USD (December 31, 2002)
(2) The results of the Group's participation in the high density polyethylene joint ventures with BP have been recorded according to the equity method in 2002.
(3) In 2001 the goodwill related to the acquisitions of BP's specialty polymers business (EUR 185 million) and of Ausimont (EUR 759 million) were charged directly against shareholders' equity with the concurrence of the Banking and Finance Committee. Without this treatment, amortization, based on 15-year lives for the BP specialty polymers assets and 40 years for assets related to Ausimont's fluorinated products, would have increased by EUR 31 million, and earnings would have been reduced by the same amount.
(4) Includes the Ausimont acquisition (EUR 1.3 billion) and the acquisition, through an exchange of assets, of BP's specialty polymers (EUR 606 million).
PERFORMANCE BY SECTOR
Millions of EUR Sales
2001 2002 2002 / 2001
Var.%
Pharmaceuticals 1,769 1,863 5%
Chemicals 2,751 2,636 -4%
Plastics 2,624(1) 1,940 -26%
Processing 1,581 1,479 -6%
GROUP 8,725 7,918 -9%
Millions of EUR EBIT
2001 2002 2002 / 2001
Var. %
Pharmaceuticals 203 230 13%
Chemicals 286 235 -18%
Plastics 70 (1) 234 234%
Processing 68 73 7%
GROUP 628 772 23%
(1) In 2001, the Solvay Group's interests in the HDPE joint ventures with BP recorded sales of 1,221 million EUR and an EBIT of -27 million EUR.
CONSOLIDATED BALANCE SHEET AFTER DISTRIBUTION: KEY FIGURES
Millions of EUR 2001 2002
Fixed Assets 6,223 5,532
Working capital 621 1,006
Shareholders' equity 3,939 3,796
minority interests 944 909
Net debt 1,050 1,053
Net debt ratio 27% 28%
FINAL RESULTS OF THE PARENT COMPANY SOLVAY S.A.
Millions of EUR 2001 2002
Net income for the year 202 220
Transfers to untaxed reserves - -
Net earnings available for distribution 202 220
Quarterly publication of results and adoption of International Accounting Standards
The 2002 statements of the Solvay Group are presented in accordance with Belgian accounting standards (Belgian GAAP). In 2003, the Solvay Group will adopt the IFRS (International Financial Reporting Standards). Pro-forma 2002 statements restated under IFRS will be inserted in the 2002 annual report, available on the Internet (www.solvay-investors.com) early April 2003. Furthermore, the Group will publish its 1st quarter 2003 results on April 30, 2003.
Key financial communication dates during 2003:
- April 30: first quarter results and annual meeting with analysts and investors
- June 5: Annual General Meeting of Shareholders
- July 31: Second quarter results
- October 31: Third quarter results.