Report and Accounts 1999 / 2000 - Carlsberg Group

62 Financial Review of the Carlsberg Group
by DKK 5.1 billion (17%) compared to last year.
This is mainly ascribable to the acquisition of
Feldschlösschen Getränke Holding AG and the full
consolidation of Carlsberg Brewery Malaysia
Berhad and Okocim in Poland. Furthermore, the
GBP exchange rate movements have resulted in
an increase in the value of Carlsberg-Tetley’s
balance sheet total. In contrast, Royal Scandinavia
is now only included in the balance sheet as an
associated company.
Equity
Equity amounted to DKK 10.6 billion (Carlsberg
A/S’ share is DKK 9.0 billion) and constitutes 30%
of the Group’s balance sheet total.
The increase in the Group’s equity mainly
derives from the profit for the year as well as exchange
rate adjustments in capital invested in
Group companies and the related long-term loans
in foreign currencies.
Deductions in equity are primarily attributable to
Group goodwill in connection with the takeover of
the remaining 40% of the shares in Sinebrychoff,
the increase of the shareholding in Carlsberg
Brewery Malaysia Berhad to 50%, the increase of
the shareholding in Unicer S.A. and Group goodwill
in connection with the acquisition of Feldschlösschen
Getränke Holding AG.
Provisions
Provisions amounted to DKK 3,131 million against
DKK 3,342 million last year. The majority of this
amount, DKK 2,432 million, relates to provisions
for pensions, etc., DKK 366 million, repayment
obligations in connection with packaging material,
DKK 1,142 million, and deferred tax, DKK 924
million. These items saw a total increase of DKK
679 million, which is mainly attributable to the
changes in the shareholdings in the companies in
Malaysia and Poland and the acquisition of
Feldschlösschen Getränke Holding AG in Switzerland.
At 31 December 2000, other provisions
amounted to DKK 699 million against DKK 1,589
million last year. This year, additions of DKK 417
million were recorded under this item and disposals
of DKK 1,307 million, including write-back of
provisions of DKK 252 million.
Additions under this item amounted to DKK
417 million and relate to severance payments in
relation to restructuring as well as provision for the
closing of the distribution company in Sweden. In
addition, provisions of DKK 107 million were made
for decided restructuring costs in connection with
the acquisition of Feldschlösschen Getränke Holding
AG.
Provisions totalling DKK 168 million were applied
during the year in connection with various
projects related to restructuring measures, the division
of Carlsberg’s organisation, etc. as well as
costs in connection with improvements in distribution
efficiency.
In addition, provisions of DKK 142 million have
been applied in connection with CCNB. The provisions
include amounts for severance payments,
expenses for the transfer of technical equipment
and other expenses necessary to complete the
restructuring project. Moreover, DKK 52 million
were applied for IT systems.
Provisions of DKK 259 million were applied at
Carlsberg-Tetley. The most substantial part – DKK
95 million – is related to the replacement of the IT
outsourcing supplier and to severance payments.
Provisions of previous years in connection with
CCNB have been applied according to plans. This
concerns the application of provisions made on 1
October 1997 to cover the running-in expenses
and structural changes during the start-up phase
of the group. In 1999/00, DKK 285 million after tax
(1998/99: DKK 420 million) was applied for these
purposes within production, sale, distribution and
administration. The remaining part of these provisions
amounted to DKK 255 million after tax.
In 1995/96, Carlsberg received compensation
from the former partner in Carlsberg-Tetley, Allied
Domecq, covering future additional expenses in
relation to new supply agreements and pension
schemes. The share of the compensation relating
to 1999/00 has been registered as income in the
profit and loss account, amounting to DKK 69 million
after tax (1998/99: DKK 141 million).
The remaining application of provisions, totalling
DKK 80 million, relates to the restructuring
measures initiated at Royal Scandinavia in previous
years.