The annual financial statements of Salzgitter AG (SZAG) for the financial year 2016 have been drawn up in application of the accounting policies and valuation methods of the German Commercial Code, taking account of the supplementary provisions set out under the German Stock Corporation Act, and have been approved without qualification by the auditor PricewaterhouseCoopers Aktiengesellschaft, Wirtschaftsprüfungsgesellschaft, Hanover. The complete text is published in the German Federal Gazette.
As before, SZAG as the management holding company heads up the Group's business units that are responsible at the operational level. Consequently, the profitability of the company depends on the business progress made by its subsidiaries and shareholdings and on the extent to which they retain their value.
The main associated companies are held through the wholly-owned company Salzgitter Mannesmann GmbH (SMG) via its wholly-owned subsidiary Salzgitter Klöckner-Werke GmbH (SKWG). There are no profit transfer agreements, neither between SZAG and SMG nor between SMG and SKWG. There is however a contractual agreement on the voluntary assumption of losses.
As a non-operational holding company, SZAG is an integral part of the Salzgitter Group's management and control concept and is therefore subject to the same control parameters and the same opportunities and risks as the Salzgitter Group. The legal requirements placed on managing and controlling SZAG have been taken into account here.
|In € m||2016/12/31||%||2015/12/31||%|
|Property, plant and equipment1)||20.7||2.4||19.0||2.0|
|Trade receivables and other assets2)||808.5||93.2||896.2||94.6|
|Cash and cash equivalents||0.0||0.0||0.0||0.0|
|In € m||2016/12/31||%||2015/12/31||%|
|due to banks||[0,0]||[0,0]|
|Equity and liabilities||867.7||100.0||947.1||100.0|
The receivables from the liquidity (€ 707 million) provided to the subsidiary SKWG as part of a groupwide cash management continue to form the main items on the assets side. The treasury shares are disclosed separately from equity in accordance with the regulations prescribed by the German Commercial Code (HGB).
On the liabilities side, in particular pension obligations of € 262 million as well as residual repayment obligations (€ 168 million) in respect of the Dutch issuer of a convertible bond are disclosed, alongside equity. The reduction in liabilities is attributable to the repayment of a convertible bond (€ 57 million), thereby resulting in an increase in the equity ratio to 45.1 % (previous year: 40.6 %).
|In € m||2016||2015|
|Other operating income||23.0||26.5|
|Other operating expenses||29.4||29.0|
|Income from shareholdings||42.5||80.9|
|Net interest result||-10.1||-12.8|
|Net income for the financial year||19.5||13.8|
Sales revenues largely comprise earnings from the levying of a Group contribution, which was attributable to the first-time application of the German Accounting Directive Implementation Act (BilRUG) in 2016. In the previous year, these earnings were disclosed under other operating income. Other operating income in 2016 includes allocations to non-current financial investments, among other items, as well as the reversal of accruals. Personnel expenses were impacted in the previous year by one-off allocations to pension provisions of € 29.6 million. Income from shareholdings consisted almost exclusively of the contribution to the result received by SMG. As of December 31, 2016, the company had a workforce of 159 employees.
Subscribed capital consisted of 60,097,000 ordinary bearer shares with a notional value per share of € 2.69 in the capital stock on the reporting date. All shares are subject to the same rights and obligations laid out under the German Stock Corporation Act (AktG).
To the knowledge of the Executive Board, the only restrictions on the voting rights or the assignment of shares on the reporting date were as follows: The company was not entitled to any voting rights from its treasury shares (6,009,700 units), and the members of the Executive and Supervisory boards were not entitled to any voting rights from their shares in respect of the resolution passed on their own ratification and discharge.
A participating interest of more than 10 % of the voting rights as per the reporting date accrued to Hannoversche Beteiligungsgesellschaft Niedersachsen mbH (HanBG), Hanover, that announced in its notification on April 2, 2002, that it owned 25.5 % of the voting rights in Salzgitter AG (SZAG); as a proportion of the total number of shares issued that has fallen since then, this corresponds to a share of 26.5 % in the voting rights. Sole shareholder of HanBG is the Federal State of Lower Saxony.
There are no shares with special rights that confer powers of control. The Executive Board does not know of any employees participating in the capital who do not exercise their power of control directly.
The appointing and dismissing of members of the Executive Board and amendments to the Articles of Incorporation are carried out solely within the provisions set out under the German Stock Corporation Act (AktG).
Based on the resolutions passed by the General Meeting of Shareholders, the Executive Board has the following three options of issuing or buying back shares:
Subject to the condition of change of control following a takeover offer, there are material agreements of the company that have the following effects:
In the event of a takeover offer, the members of the Executive Board have the right to terminate their contracts of employment under certain preconditions and are entitled to settlement in an amount of the total remuneration over the residual term of their respective contracts. There is, however, a cap on the maximum amount of this entitlement.
SZAG reported annual net income of € 19.5 million in the financial year 2016. Including the profit carryforward (€ 1.6 million), unappropriated retained earnings amount to € 21.1 million.
The Executive Board and the Supervisory Board will propose to the General Meeting of Shareholders that these unappropriated retained earnings (€ 21.1 million) be used to fund payment of dividend of € 0.30 per share (based on the capital stock of € 161.6 million divided into 60,097,000 shares) and that the remaining amount be carried forward to new account.
If the company holds treasury shares on the day of the General Meeting of Shareholders, the proposed appropriation of profit will be adjusted accordingly at the Meeting as treasury shares are not eligible for dividend.