sain t-gobain annu al report 2008 annual report

NOTE 6
Investments in associates
(in € millions) 2008 2007 2006
At January 1
Equity in associates 106 224 131
Goodwill 17 14 8
Investments in associates 123 238 139
Movements during the year
Changes in group structure (9) (114) 107
Translation adjustments (6) (4) (11)
Transfers, share issues
and other movements 1 (3) 1
Dividends paid (4) (8) (5)
Share in net income of associates 11 14 7
Total (7) (115) 99
At December 31
Equity in associates 98 106 224
Goodwill 18 17 14
Investments in associates 116 123 238
Changes in group structure in 2006 chiefly reflected the firsttime
consolidation – by the equity method – of Izocam
(Turkey) and Saint-Gobain Envases SA (Chile) for a total of
€116 million. At December 31, 2006, the market value of the
Izocam shares owned by Saint-Gobain (based on the price
quoted on the Istanbul stock exchange) approximated the
carrying amount of the Group’s equity in Izocam’s net assets.
Net sales recorded in the individual financial statements of
associates totaled €798 million in 2008 (2007: €939 million;
2006: €1,004 million) and aggregate net income totaled
€34 million (2007: €42 million; 2006: €54 million). At
December 31, 2008, total assets and liabilities of these companies
amounted to €766 million and €448 million, respectively
(December 31, 2007: €849 million and €493 million;
December 31, 2006: €917 million and €524 million).
At December 31, 2008, investments in associates amounted to
€116 million (December 31, 2007: €123 million).
They included shares in Compania Industrial El Volcan, which
is listed on the Santiago de Chile stock exchange.
Saint-Gobain’s equity in Compania Industrial El Volcan’s
consolidated net assets was only slightly greater than the
market value of the shares at December 31, 2008 due to the
recent stock market volatility, but was significantly more than
the shares’ average market value over the year.
The decrease in investments in associates in 2007 was primarily
due to the change in consolidation method for Izocam
and Saint-Gobain Envases SA, which had a negative impact of
€113 million.
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Saint-Gobain – Financial Report 2008