Geberit AG Annual Report 2005

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Business and Financial Review
Sound equity base and balance sheet structure

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Thanks to the rise in free cashflow, the balance sheet structure of the Geberit Group was further strengthened at the end of 2005. Debt was reduced by CHF 141.9 million to CHF 393.4 million. Consequently, net debt also posted a satisfactory decline by CHF 240.3 million to CHF 213.4 million.

Debt (in CHF million)
	12/2005	12/2004	12/2003
Long-term debt	344.0	531.7	293.6
Total debt	393.4	535.3	297.2
Cash and cash equivalents	180.0	81.6	181.3
Net debt	213.4	453.7	115.9

As of the year-end 2005, the equity ratio amounted to a sound 49.2% (prior year 42.2 %). In terms of average equity, the Group was able to increase its return on equity to 29.1% in the year under review (prior year 23.8 %). The gearing (net debt/equity) improved from 55.5% in the previous year to 22.3% as of 31 December 2005.

The Group’s liquidity situation was comfortable. In addition to liquid funds in the amount of CHF 180.0 million, the Group had access to operating credit facilities of CHF 413.4 remaining undrawn as of 31 December 2005.

As of 31 December 2005, the Geberit Group held 69,160 own shares in treasury, i.e. just under 3,000 more than in the previous year. Treasury shares are primarily earmarked for share participation plans.

In the year under review, total assets at CHF 1,946.6 million (prior year CHF 1,937.1 million) remained practically unchanged. Net working capital was reduced further to CHF 120.8 million. Goodwill and intangible assets declined to CHF 812.4 million, property, plant and equipment to CHF 528.3 million.

Operating capital, comprising net working capital, property, plant and equipment as well as goodwill and intangible assets, amounted to CHF 1,461.4 million (prior year CHF 1,548.5 million) as of the end of 2005. The return on operating assets, expressed as the ratio of operating profit before amortization (EBITA) to average operating capital, amounted to 24.6% (prior year 23.1%) in the year under review.