ANNUAL REPORT INTRUM JUSTITIA A N N U A L R EP O R T 2 0 ...
ANNUAL REPORT INTRUM JUSTITIA A N N U A L R EP O R T 2 0 ...
ANNUAL REPORT INTRUM JUSTITIA A N N U A L R EP O R T 2 0 ...
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GOODWILL<br />
The Group’s goodwill amounted to SEK<br />
2,152.5 M, compared to SEK 1,825.3 M as of<br />
December 31, 2009.<br />
The change is attributable to the acquisition<br />
of Aktiv Kapital’s Nordic credit management<br />
operation in the amount of SEK 429.2<br />
M and Nice Invest Nordic in the amount of<br />
SEK 39.0 M, as well as exchange rate differences<br />
of SEK –141.0 M.<br />
NON-fINANCIAL EARNINGS INDICATORS<br />
Employees<br />
The average number of employees during<br />
the year was 3,099 (3,372). The number of<br />
employees decreased mainly in the United<br />
Kingdom, Spain and Hungary. Employee<br />
turnover during the year was 24 percent (25).<br />
Women accounted for 63 percent (63) of the<br />
employees during the year. The percentage of<br />
employees with college-level degrees was 30<br />
percent (28).<br />
For more information on the employees and<br />
salaries and other remuneration, see also Notes<br />
28 – 32 and page 25 in the Annual Report.<br />
Northern Europe<br />
Central Europe<br />
Western Europe<br />
Employees by geographical region, %<br />
Social responsibility and the environment<br />
The Group continues to pursue its corporate<br />
social responsibility (CSR) work. See page 24<br />
in the Annual Report.<br />
The purpose of running a business is to<br />
provide shareholders with a return on their<br />
investment. Striving for profitability helps to<br />
ensure a company’s long-term survival. In addition<br />
to this, Intrum Justitia has an important<br />
mission as a catalyst for a sound economy<br />
where businesses can receive and grant<br />
credit. With its credit management services,<br />
the company is helping to make business<br />
easy, fair and secure, and is thereby promoting<br />
a sustainable economy. In a general sense,<br />
Intrum Justitia’s business objectives coincide<br />
with society’s sustainability goals. The company’s<br />
business activity and sustainability<br />
work are, from this perspective, identical.<br />
Intrum Justitia follows the OECD guidelines<br />
for multinational corporations.<br />
Business ethics<br />
Intrum Justitia works according to a strict<br />
code of ethics which is unique in the CMS<br />
industry. The code stresses respectful relationships<br />
with creditors and debtors, and<br />
fair payment arrangements between Intrum<br />
Justitia’s clients and their customers.<br />
In Intrum Justitia’s code of ethics, paying<br />
close attention to what is prescribed by law,<br />
respecting the integrity of the debtor in all<br />
situations, and ensuring information security<br />
for all parties involved, as well as conducting<br />
all credit management and receivables work<br />
in a professional way, i.e. efficiently and accurately,<br />
are all clear norms.<br />
Working conditions<br />
A sustainable and commercially successful business<br />
relies on skilled and motivated employees.<br />
The Group has a high level of ambition in the<br />
area of human resources, setting its sights on<br />
attracting, developing and retaining the best<br />
people in the market. Part of Intrum Justitia’s<br />
vision is to be a true people company. The employees<br />
have the right to secure and healthy<br />
workplaces, as well as fair compensation in line<br />
with market levels. Men and women are given<br />
the same opportunities. The goal in recruiting<br />
managers is to find the most competent and<br />
qualified candidates regardless of gender. No<br />
employee may be submitted to discrimination,<br />
nor is any form of sexual harassment tolerated.<br />
All employees have the right to organize and<br />
join unions as well as to negotiate collectively<br />
if they wish, although they also have the right<br />
to decline union membership.<br />
Environment<br />
The environment is a topical issue, but it is also<br />
complex in that a balance is required between<br />
various environmental risks and interests.<br />
While Intrum Justitia naturally wants to help<br />
improve the environment, it does not claim to<br />
have answers to all of the questions regarding<br />
environmental priorities.<br />
Intrum Justitia does not have any operations<br />
in Sweden that are subject to licensing or reporting<br />
requirements according to the Environmental<br />
Code. The Group operates in the<br />
service sector and its operations are therefore<br />
considered to have limited environmental impact.<br />
Environmental requirements are applied<br />
in each country and are at least equivalent to<br />
local environmental legislation to the extent<br />
they apply to the Group’s operations.<br />
Intrum Justitia works to systematically improve<br />
efficiencies in its energy consumption<br />
and travel, thereby reducing the company’s<br />
environmental footprint. The Group’s policy<br />
includes encouraging alternatives to transport<br />
and travel, such as conference calls and<br />
Board of Directors’ report<br />
video and web conferences. Regionalization<br />
has also reduced the need for travel within the<br />
Group. Through environmentally adapted<br />
procurement, improved recycling processes<br />
and reduced waste volumes, Intrum Justitia is<br />
reducing its environmental footprint as well as<br />
its costs.<br />
MARKET OUTLOOK<br />
We are witnessing a slow macroeconomic<br />
recovery in Europe with significant differences<br />
between regions. Intrum Justitia has<br />
a better chance now of solving customers’<br />
(debtors) financial problems than at the<br />
peak of the global financial crisis. Although<br />
collectability is not back at the level that existed<br />
before the financial crisis, the situation<br />
has stabilized.<br />
We are seeing an increase in demand for<br />
integrated credit management and financial<br />
services. There is a growing need among our<br />
clients for a stronger and more predictable<br />
cash flow. The need for more options to finance<br />
working capital is also growing.<br />
We believe that Intrum Justitia’s strategic<br />
focus on an expansion of credit management<br />
services connected to risk-reducing and financing<br />
services based on a strong, marketleading<br />
collections foundation, is well-suited<br />
to developments in the market. We are anticipating<br />
considerable demand for these types of<br />
services in the years ahead.<br />
The Group’s acquisitions of small and medium-sized<br />
portfolios of overdue receivables<br />
are in the long term expected to amount to<br />
around SEK 800 M per year. This does not<br />
include individual acquisitions of larger portfolios.<br />
Intrum Justitia has a long-term investment<br />
strategy with a low risk profile, the stability<br />
of which was demonstrated during the<br />
financial crisis.<br />
fINANCIAL OBJECTIVES<br />
Intrum Justitia’s financial objectives are to<br />
reach organic growth of 10 percent per year<br />
and generate pre-tax earnings which are at least<br />
in line with annual organic growth. Moreover,<br />
the Group will achieve an annual return on<br />
investments in the Purchased Debt operation<br />
of at least 15 percent, The net debt/equity ratio<br />
(interest-bearing net debt as a percentage<br />
of shareholders’ equity and minority interests)<br />
will not exceed 150 percent over the long term.<br />
Intrum justitia will also actively seek opportunities<br />
to grow through selective acquisitions.<br />
In 2010 organic growth was -0.8 percent<br />
and pre-tax earnings increased by 8.7 percent<br />
compared to the previous year. Return on<br />
capital invested in the Purchased Debt service<br />
line amounted to 16.3 percent. The net<br />
debt/equity ratio was 85.1 percent at the end<br />
39