The financial statements represent the financial position of Compagnie Financière Richemont SA ('the Company') at 31 March 2005 and the results of its operations for the year then ended, prepared in accordance with Swiss law.
General expenses comprise the following:
|
2005 |
2004 |
|
|---|---|---|
| Personnel expenses | 3.1 | 3.1 |
| Depreciation of property, plant and equipment | 0.1 | 0.1 |
| Other | 5.0 | 7.3 |
| 8.2 | 10.5 |
These comprise investments in wholly-owned subsidiary companies, which are stated at cost.
| 2005 SFr m |
2004 SFr m |
|
|---|---|---|
| Richemont SA, Luxembourg | 700.0 | 700.0 |
| Other investments | 0.2 | 0.2 |
| 700.2 | 700.2 |
Excluding land, the net book value of property, plant and equipment at 31 March 2005 was SFr 0.1 million (2004: SFr 15.0 million). The fire insurance value of property, plant and equipment at 31 March 2005 was SFr 0.1 million (2004: SFr 23.7 million). The reduction in the net book value of property, plant and equipment is due to the disposal of the office building in Zug, following the relocation of the Company's registered office from Zug to Geneva.
| 2005 SFrm |
2004 SFr m |
|
|---|---|---|
| 522 000 000 'A' bearer shares with a par value of SFr 1.00 each, fully paid | 522.0 | 522.0 |
| 522 000 000 'B' registered shares with a par value of SFr 0.10 each, fully paid | 52.2 | 52.2 |
| 574.2 | 574.2 |
The legal reserve of SFr 117.6 million (2004: SFr 117.6 million) is not available for distribution.
The reserve is created in respect of Richemont 'A' units purchased by a subsidiary company.
During the year the Group did not purchase any 'A' units in the open market or from executives. In 2004, 6 345 960 'A' units were purchased in the open market for a total cost of SFr 208.2 million in order to hedge obligations under the Group's stock option plan and a further 120 150 units were repurchased from executives.
During the year 4 318 652 'A' units (2004: 1 597 850 'A' units) were sold to executives of the Group under the Group's stock option plan.
At 31 March 2005, following these transactions, the Group held 23 968 608 Richemont 'A' units (2004: 28 287 260 Richemont 'A' units).
During the year the Group purchased a call option to acquire 4 000 000 'A' units in order to hedge obligations under the Group's stock option plan. No part of this option contract was exercised in the year.
A Richemont 'A' unit is composed of one 'A' bearer share issued by the Company and one participation certificate issued by Richemont SA. At the time of formation of Richemont, 25 per cent of the value of an 'A' unit was attributed to the 'A' bearer share issued by the Company and 75 per cent to the participation certificate issued by Richemont SA. In terms of the reserve for own shares established in respect of the units purchased, an amount of SFr 35.4 million, being 25 per cent of the cost of units sold to Group executives during the year, has been transferred out of the reserve for own shares. This amount has been partly offset by an amount of SFr 21.2 million, being 25 per cent of an adjustment due to a change in the method of valuing the Group's holding of units. The net amount of SFr 14.2 million has been transferred out of the reserve for own shares (2004: SFr 30.0 million had been transferred to the reserve for own shares). The remaining 75 per cent of the adjusted cost of units sold has been transferred out of the reserve for own participation certificates in the balance sheet of Richemont SA.
| 2005 SFr m |
2004 SFr m |
|
|---|---|---|
| Balance at 1 April of prior year retained earnings | 363.6 | 306.2 |
| Net transfer (to)/from reserve for own shares | 14.2 | (30.0) |
| Balance at 1 April, after appropriations | 377.8 | 276.2 |
| Net profit | 113.2 | 87.4 |
| Balance at 31 March | 491.0 | 363.6 |
At 31 March 2005 the Company had given no guarantees. At 31 March 2004 the Company had given guarantees totalling SFr 646.4 million in respect of which it had received indemnities from subsidiaries in the same amount. Obligations to third parties of various Group companies under these guarantees at 31 March 2004 amounted to SFr 218.9 million.
The directors believe that there are no contingent liabilities.
Pursuant to the requirements of the Swiss Federal Act on Stock Exchanges and Securities Trading and the associated ordinances, the Company received formal notification in December 2000 from Compagnie Financière Rupert that it held 522 000 000 'B' registered shares, representing 50.0 per cent of the voting rights in the Company. In addition, Compagnie Financière Rupert has indicated that parties related to it held or controlled 135 426 'A' bearer shares (either directly or through the medium of South African Depository Receipts), representing 0.01 per cent of the voting rights in the Company as at 31 March 2005.
Also pursuant to the requirements of the Swiss Federal Act on Stock Exchanges and Securities Trading and the associated ordinances, the Company received formal notification in January 2003 from The Capital Group Companies Inc., Los Angeles, that companies under its control held 52 501 787 'A' bearer shares, representing 5.03 per cent of the voting rights in the Company. In February 2005 the Company received notification from the Capital Group Companies Inc., Los Angeles, of a reduction in its shareholding to 50 185 417 Richemont 'A' bearer shares, representing 4.81 per cent of the voting rights in the Company.
Richemont Securities SA, a wholly-owned subsidiary of the Company, acts as depository in respect of Richemont South African Depository Receipts ('DR's'), which are traded on the JSE Securities Exchange South Africa. DR's trade in the ratio of ten DR's to each Richemont 'A' unit. In its capacity as depository and on behalf of the holders of DR's, Richemont Securities SA holds one 'A' unit in safe custody for every ten DR's in issue. Richemont Securities SA's interest in Richemont 'A' units is therefore non-beneficial in nature.
All dividends attributable to the 'A' units held in safe custody are remitted by Richemont Securities SA individually to holders of DR's and Richemont Securities SA acts as the approved representative of DR holders in voting at shareholders' meetings of the Company. DR holders may provide Richemont Securities SA with voting instructions as to their holdings of DR's and Richemont Securities SA may only vote on behalf of those DR holders from whom it has received such instructions.
At 31 March 2005, Richemont Securities SA held 160 543 267 Richemont 'A' units (2004: 166 658 221 units), representing some 31 per cent (2004: 32 per cent) of the 'A' units, in safe custody in respect of DR's in issue.
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