Comparison figures for Quarter 4 2005 and Quarters 1-3 2006 as a result of organizational changes:
As previously announced, an organizational change was implemented as of January 1, 2007 with the result that the Trelleborg Building Systems business area was merged into the Trelleborg Engineered Systems business area and will become a part of that business area.
Trelleborg’s operations are thus divided into four business areas (share of consolidated full-year sales as of September 2006 adjusted for acquisitions in parentheses): Trelleborg Engineered Systems (37%), Trelleborg Automotive (33%), Trelleborg Sealing Solutions (19%) and Trelleborg Wheel Systems (11%).
The year-end report for 2006 to be published on February 13, 2007 will be based on the new Group structure. To achieve comparability, historical data was therefore adjusted. See the attached table section.
Previously announced action programs expected to be charged against Quarter 4 2006:
At Trelleborg’s Capital Market Day in November 2006, an action program was announced for the Automotive, Wheel Systems and Engineered Systems business areas.
The action program within Automotive followed the autumn’s strategic and operational overview and is aimed at improving profitability and the strategic position. For the Wheel Systems business area, an announcement was made of the decision to consolidate industrial tire production to Sri Lanka, resulting in the closure of the plant in Hartville, Ohio. The action program within Engineered Systems pertains to the relocation of production from Ystad to Lithuania and enables continued profitable growth within the area of protective products.
The total pretax cost for these action programs is estimated at SEK 875 M for Automotive, SEK 30 M for Wheel Systems and SEK 13 M for Engineered Systems.
On full implementation of the action programs, the positive earnings effect is estimated at approximately SEK 220 M before tax. The positive earnings effect of the programs is expected to be marginal for 2007.
The sections of the action programs announced to date, combined with the effect of testing for the impairment of goodwill, are expected to be charged to operating profit for the fourth quarter of 2006 in a total amount of about SEK 325 M and to net profit at about SEK 300 M. These costs are within the framework of assessed total costs for the action programs announced earlier.