Comptes consolidés 2011 - Genoyer€¦ · Provisions and deferred taxes 9,777 9,273 Provisions for other liabilities and charges 2.10 8,267 7,397 Deferred income tax liabilities

Comptes consolidés 2011

CONSOLIDATED FINANCIAL STATEMENTS, DECEMBER 31, 2012

1

SUMMARY

BALANCE SHEET 02 > 03 INCOME STATEMENT 04

STATEMENT OF CASH FLOWS 05 MAIN EVENTS 06

SIGNIFICANT ACCOUNTING POLICIES 07 > 12 NOTES TO THE BALANCE SHEET 13 > 21

NOTES TO THE INCOME STATEMENT 22 > 23 OTHERS INFORMATIONS 24 > 26

SCOPE 27 STATUTORY AUDITOR’S REPORT 28 > 33


2

BALANCE SHEET ASSETS

(in thousands of Euros)Note Gross

amountNet

amount

Unpaid capital 12 - 12 -

Non-current assets 126,518 81,458 45,060 44,925Goodwill 2.1 9,723 5,749 3,974 4,247Intangible assets 2.2 4,917 4,244 674 539Tangible assets 2.3 108,108 71,429 36,680 36,476Financial assets 2.4 3,769 37 3,732 3,663

Inventories 76,456 2,073 74,383 65,770Raw materials and supplies 22,869 542 22,327 22,350Work in progress 12,482 - 12,482 12,308Finished goods 19,673 752 18,921 13,074Goods purchased for resale 21,432 779 20,653 18,038

Accounts receivable 95,382 405 94,977 100,243Prepayments 690 - 690 434Trade receivables 2.5 87,555 259 87,295 84,506Other receivables 2.6 7,138 146 6,992 15,303

Other receivables and suspense accounts 4,307 - 4,307 4,771Prepaid expenses 894 - 894 1,053Deferred expenses related to financial borrowings 2.8 - - - -Deferred income tax assets 2.11 3,413 - 3,413 3,718

Cash and cash equivalents 2.7 33,838 - 33,838 42,808

TOTAL ASSETS 336,512 83,936 252,577 258,517

December 31, 2012

Net amount

December 31, 2011

Accumulated depreciation


3

BALANCE SHEET

LIABILITIES AND SHAREHOLDERS' EQUITYDecember 31, 2012 December 31, 2011

(in thousands of Euros) Note

Shareholders' equity - Group 2.9 143,725 132,139Share capital 61,179 61,179Merger reserve 18 -Legal reserve 6,118 6,118Consolidated reserves 64,998 52,471Investment grants 162 127Cumulative currency translation difference (232) (288)Profit / (loss) for the period - Group share 11,481 12,532

Minority interests 2.9 25 39

Provisions and deferred taxes 9,777 9,273Provisions for other liabilities and charges 2.10 8,267 7,397Deferred income tax liabilities 2.11 1,510 1,876

Borrowings and financial debts 2.12 10,959 34,897

Current Liabilities 88,090 82,168Advance payments received 9,537 5,784Trade payables 2.13 63,029 63,457Salaries, wages, related social items and other tax liabilities 7,686 7,215Payables related to capital expenditure 552 933Deferred revenue 5 9Other payables and accruals 2.14 7,281 4,769

TOTAL LIABILITIES 252,577 258,517


4

INCOME STATEMENT

(in thousands of Euros) Note December 31, 2012 December 31, 2011

Net Sales 3.1 304,255 295,682

Operating expensesPurchases and changes in inventory of goods for resale (118,328) (138,455)Raw materials used (71,716) (61,746)Work in progress 6,621 6,889Personnel costs (38,804) (37,096)Other purchases and external expenses (54,260) (46,484)Taxes (other than on income) (2,536) (2,070)Depreciation and amortization (5,576) (5,390)Net change in provisions 3.2 (1,270) 1,234Other profit / (loss) 3.3 (1 844) (,518)

Operating profit 16,541 12,046 Net financial income / (loss) 3.4 (229) 1,908

Profit before income tax and exceptional items 16,313 13,954

Exceptional profit 3.5 602 (441)

Net current income tax profit / (expense) (5,255) (3,233)Net deferred income tax profit / (expense) 73 2,202Net income tax profit / (expense) 2.11 (5,181) (1,031)

Profit before goodwill amortization 11,734 12,483

Goodwill amortization (270) (45)

Profit for the period 11,464 12,438Minority interests (17) (94)Profit for the period - Group share 11,481 12,532

EBITDA before restructuring, environment, health and safety costs

3.623,308 19,977

(In €)Basic earnings per share 4.3 7,15 7,81 Diluted earnings per share 7,15 7,81


5

STATEMENT OF CASH FLOWS

(in thousands of Euros) December 31, 2012 December 31, 2011

Profit / (loss) for the period 11,464 12,438

Non cash items for operating activities

Depreciation and changes in provisions 6,368 3,757

Goodwill amortization 270 45

Deferred income taxes (73) (2,201)

Net loss / (profit) on sale and disposal of fixed assets (11) (11)

Changes of interests on borrowings (432) 240

Changes in working capital (5 221) (9,609)

Cash flows from operating activities 12,364 4,660

Investing activities

Purchase of intangible and tangible assets (6,064) (8,581)

Purchase of financial assets (182) (66)

Proceeds from the sale of intangible and tangible assets 247 36

Proceeds from the sale of financial assets 154 38

Acquisition of subsidiaries, net of cash acquired (12) (1,563)

Investment grants received 59 115

Changes in payables and receivables related to fixed assets (381) 727

Cash flows from investing activities (6,179) (9,294)

Financing activities

Variation of shareholder's current account (23,846) (20,484)

Variation of other current accounts 8,253 (8,161)

Repayments of borrowings (367) (212)

New borrowings 750 483

Increase in other short term debt 10 96

Dividends paid - (4,334)

Cash flows from financing activities (15,200) (32,612)

Net cash flows (9,015) (37,246)

Effect on cash of changes in exchange rate 45 185

Cash and cash equivalents at the beginning of the period 42,808 79,870

Cash and cash equivalents at the end of the period 33,838 42,808

Operating activities


6

MAIN EVENTS

1. Change in consolidation scope

• Incorporation within the consolidation scope of Genoyer Do Brazil, founded in 2012

whose purpose is the distribution of supplies and services in the Brazilian domestic

market. The company is 100% owned.

• Liquidation and exit from consolidation of the Singaporean subsidiary JV SSH.

• The Group extended its presence on the African continent in 2012 by creating, in

cooperation with local partners, (1) Phocéenne Nigeria Limited, 24% held by Genoyer

SA, and (2) Genoyer Angola LDA, 49% held by Genoyer SA. The Group exercises a joint

control in both these companies.

• Valves and Flow Technologies activity strengthened in China with the creation of the

subsidiary Valves and Flow Technologies China, 100 % held.

• Exit from the consolidation scope of IPS, which was dissolved by a General Assembly

decision dated October 26, 2012. This was a dissolution without liquidation and a

transfer of assets for the benefit of Genoyer SA. The operation was performed through

the French dissolution process called “Transmission Universelle de Patrimoine” (TUP)

dated December 1, 2012, after the creditor opposition deadline.

On February 6, 2012 Genoyer SA received notice of a tax inspection relating to the period January 1,

2009 to December 31, 2010, as well as to the amount of income tax paid for the year ended December

31, 2008.

At year-end, the inspection is still in progress, and the Company has received a first proposed

adjustment for periods closed before January 1, 2010.

As the inspection is still in progress the Company cannot pronounce on the adjusted elements and those

to come.

2. Events after the reporting period

In the context of a disposal of assets of remote strategic value, because of their distance from its center

of activity, the Group authorized its Scottish subsidiary Munro & Miller Fittings Limited to sell on January

31, 2013 its main operating assets, including its business and all employees. The historical activity

carried out by Munro & Miller Fittings Limited thus continues from February 1, 2013 through the

company which now owns the sold assets. On February 14, 2013, Munro & Miller Fittings Ltd changed

its name to Genoyer (Scotland) Limited.


7

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Genoyer SA and its consolidated subsidiaries (hereafter referred to as the “Company” or the

“Group”) prepare consolidated financial statements in accordance with the provisions of “Comité de

la Règlementation Comptable” (CRC) regulation 99-02 and generally accepted accounting principles

in France.

The preparation of financial statements requires the Group to make estimates and assumptions that

affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities

at the date of the financial statements and the reported amount of revenues and expenses during

the period. Actual results may differ from these estimates.

These financial statements are established in euros.

The financial year beginning January 1, 2012 and ending December 31, 2012 is a period of 12 months.

1.1 PRINCIPLES OF CONSOLIDATION

The consolidated financial statements include the accounts of Genoyer SA and all of its material

subsidiaries. Subsidiaries are all entities over which the Company has the power to govern the

financial operating policies generally accompanying a shareholding of more than one half of the

voting rights. The financial year-end for all the companies included within the scope of consolidation

is December 31.

Subsidiaries are consolidated from the date on which control is transferred to the Company. They

cease to be consolidated from the end of the control date.

All intercompany balances and transactions between group companies are eliminated. The exchange

differences arising on foreign currency intercompany transactions are included in the profit and loss

account for the year.

The financial statements of the companies included in the consolidated financial statements are

prepared in accordance with the accounting principles generally accepted in their respective

countries. Some consolidation adjustments are recorded so as to ensure that these financial

statements comply with the Group accounting principles.


8

1.2 GOODWILL

At the date of the acquisition of a subsidiary, identifiable assets acquired and liabilities assumed are

measured at their fair value. The excess of the cost of acquisition over the fair value of net assets

acquired is recorded as goodwill, recognized as an asset and amortized over a maximum duration of

twenty years.

At year-end, goodwill is tested for impairment whenever events or changes in circumstances indicate

the carrying value may not be recoverable. If the net carrying value is higher than the recoverable

value which is the higher amount between the useful value and the net market value, then a

depreciation amounting to the difference is recorded.

1.3 START UP COSTS

Start-up costs are expensed as incurred.

1.4 NON CURRENT ASSETS

1.4.1 INTAGIBLES ASSETS

Intangible assets are mainly composed of:

• Software which is amortized over 3 to 5 years

• Acquired goodwill which is amortized over 5 years

• Right to use lands which is amortized over 10 years

1.4.2 TANGIBLE ASSETS

In 1998, the company performed a revaluation of tangible assets, on all subsidiaries. This revaluation

took place in relation to the change of ownership structure of Financière Genoyer, shareholder of

Genoyer SA. Technical and economic experts revalued the tangible assets of the Group to their fair

market value.


9

The tangible assets acquired as part of the acquisition of Genoyer SA and its subsidiaries, revalued in

1998, are depreciated over their estimated remaining useful lives as follows:

• Buildings 10 years

• Fixtures and fittings 10 years

• Technical installations 10 years

• Tools and machinery 5 to 10 years

• Vehicles 3 years

• Furniture and office equipment 3 years

The revalued tangible assets mainly relate to operations. Whenever events or changes in

circumstances indicate their carrying value may not be recoverable, an additional depreciation is

recorded.

Other tangible assets are recognized at their historical cost. Components of tangible assets except for

land are depreciated on a straight-line basis over their estimated useful lives, which, for the main

categories, are as follows :

• Buildings 20 years

• Fixtures and fittings 10 years

• Technical installations 5 to 15 years

• Tools and machinery 5 to 15 years

• Vehicles 4 to 5 years

• Furniture and office equipment 3 to 10 years

Material capital expenditures purchased under a finance lease are recognized as an asset and

capitalized on the basis of the present value of the minimum lease payments. They are depreciated

over their estimated useful lives.

The company incurs no significant inspection costs that may require a provision or a component to be

recognized.

1.4.3 INVESTMENTS

Entities over which the Group has no significant influence or control are recognized at cost and not

consolidated. A provision is recorded when the recoverable amount at the balance sheet date is

lower than the net carrying amount. The recoverable amount is determined considering the share of

net equity of the investment and its anticipated future cash flows.

Entities for which consolidation is not significant or which are dormant or over which the Group has

no significant influence or control are not consolidated.


10

1.5 INVENTORIES AND RECEIVABLES

Inventories of goods purchased for resale and raw materials are valuated item by item at average

weighted cost. Given the specific nature of the products sold by the Company, aging has no effect on

their net realizable value.

Inventories of work in progress and finished goods are carried at their cost value including direct and

indirect costs so that this cost is as close as possible to the manufacturing cost.

The determination of the allowance against inventories is based on a classification by category of

inventories in compliance with the product and market expertise / knowledge of the Group. If any

risk is identified on the recoverability of an item, it is classified within the relevant category, which

will be depreciated based on the analysis of the product and market. The net book value equals the

minimum scrap value.

Receivables are recognized at their nominal value and allowances are calculated on a case by case

analysis, excluding value added tax, depending on local regulation.

1.6 FOREIGN CURRENCY TRANSLATION

1.6.1 FOREIGN SUBSIDIARIES FINANCIAL STATEMENTS TRANSLATION

Concerning the Company’s foreign subsidiaries and affiliates using a functional currency other than

euro, assets and liabilities are translated into euros using the year-end exchange rate and revenues

and expenses are translated into euros at exchange rates which approximate the average exchange

rates prevailing during the period.

The resulting translation adjustments are recorded in a separate account of shareholders’ equity as

“Cumulative Currency Translation Difference”.


11

1.6.2 TRANSLATIONS IN FOREIGN CURRENCIES

Transactions made by consolidated entities which are denominated in foreign currencies are

translated into the functional currency of the consolidated entities at the exchange rate at the

transaction date.

Payables and receivables in a currency other than the functional currency of an entity of the group

are translated at the year-end exchange rate or at the hedging exchange rate. Unrealized exchange

gains and losses resulting from this translation are recorded in profit and loss of the period:

- As operating profit for trading operations,

- As financial profit and loss for financing operations.

Payables or receivables of a consolidated entity, for which repayment is neither planned nor likely to

take place in the foreseeable future, are considered as a long-term investment. The exchange

difference relating to these payables or receivables is accounted for directly in shareholders' equity.

1.6.3 FINANCIAL INSTRUMENTS

The group uses financial instruments exclusively to hedge foreign exchange positions on international

operations. The group hedges its foreign exchange positions by using non-speculative forward

exchange contracts. Hedged transactions are recorded at their forward hedging exchange rate.

Instruments qualifying under hedge accounting criteria are recognized as off-balance sheet

commitments until the hedged transactions are completed.

1.7 DEFERRED TAXES

Deferred income tax results from temporary differences between the carrying amounts of assets and

liabilities in the consolidated financial statements and their tax bases. The deferred income tax is

provided using the liability method, whereby deferred tax balances are determined using tax rates

(and laws) that have been enacted or substantially enacted by the year-end closing date and are

expected to apply when the related deferred income tax asset is realized or the deferred income tax

liability is settled. Deferred income tax assets on tax losses and on temporary differences are

recognized to the extent that it is probable that future taxable profit will be available against which

these assets can be utilized


12

1.8 RETIREMENT BENEFITS

As recommended by “Conseil National de la Comptabilité” (CNC) regulation 2003 R-01, post

retirement obligations are recognized in the balance sheet. A provision has been estimated based on

actuarial assumptions and analysis, and Group estimates relating to employee turnover. Actuarial

gains and losses are recognized directly in the result of the period.

1.9 PROVISIONS FOR OTHER LIABILITIES AND CHARGES

Provisions for other liabilities and charges are recorded in accordance with CRC regulation 2000-06

concerning liabilities.

Provisions are recorded to cover the liabilities and charges linked to known claims which relate to

past events. These provisions are calculated based on the Group’s best estimate of the probable

outflow of resources that will be required to settle the obligation.

1.10 FINANCIAL BORROWINGS

Financial borrowings are stated at historical cost.

1.11 EARNINGS PER SHARE

“Basic earnings per share” are calculated by dividing “Profit for the period - Group share” by the

weighted average number of ordinary shares in issue during the year. “Diluted earnings per share”

are computed after taking into account equity instruments issued by the group.


13

2. NOTES TO THE BALANCE SHEET

2.1 GOODWILL

Opening Changes Changes in Closing

31-Dec-11 consolidation scope

31-Dec-12

Gross value 9,732 - - (9) 9,723

Amortization (5,485) (270) - 6 (5,749)

Net value 4,247 (270) - (3) 3,974

Other changes (including changes in

exchange rate)

(in thousands of Euros)

2.2 INTANGILE ASSETS

Opening Additions Closing

31-Dec-11 31-Dec-12

Gross value

Software 3,431 90 (49) - 38 3,510Acquired intangibles 68 - - - - 68Other 1,260 80 - - - 1,340

Total 4,759 170 (49) - 38 4,917

Amortization

Software 3,275 68 (49) - (1) 3,293Acquired intangibles 68 - - - - 68Other 877 6 - - - 883-Total 4,220 74 (49) - (1) 4,244

Net value 539 96 - - 39 674

Other changes (incl. changes in exchange rate)

Changes in consolidation

scope

Disposals and retirements



14

2.3 TANGIBLE ASSETS


(in thousands of Euros)31-Dec-11 31-Dec-12

Gross value

Land 3,452 - - - 1,064 4,516Buildings 31,104 653 (637) - (707) 30,413Plant and Equipment 64,032 3,727 (417) - 840 68,182Other (including assets in progress) 4,721 1,515 (210) - (1,029) 4,997

Total 103,309 5,894 (1,264) - 169 108,108

Amortization

Buildings 23,117 763 (439) - 24 23,464Plant and Equipment 41,345 4,575 (387) - 89 45,622Other 2,372 164 (201) - 8 2,343

Total 66,833 5,502 (1,027) - 121 71,429

Net value 36,476 392 (236) - 48 36,680

including : Assets under capital leases

1,015 - (138)-

- 877


scope

Other changes (incl. changes

in exchange rate)


The increase in buildings is mainly related to reorganizations of workshop logistic warehouses (at BSL

and Vilmar).

The increase of material and tools for the year includes 790 thousand euros of acquisitions by BSL

Pipes & Fittings, and 1,910 thousand euros of acquisitions by Vilmar.

The increases in assets under construction mainly relate to Vilmar and SBS.


15

2.4 FINANCIAL ASSETS


(in thousands of Euros) 31-Dec-11 31-Dec-12

Investments 3,381 347 - (347) - 3,381Deposits 317 182 (109) - (3) 388

Gross value 3,698 529 (109) (347) (3) 3,769

Provisions 35 2 0 0 0 37

Net value 3,663 527 (109) (347) (3) 3,732

Other changes (including changes in

exchange rates)


scope


The change in consolidation scope relates to the acquisition of shareholding in Genoyer Do Brazil,

VFTC (Valves & Flow Technologies China) and Phocéenne Nigeria.

Carrying amount of non-consolidated investments

Gross value Provision Net value % ownership


Genoyer International 3,344 - 3,344 2%Phoceenne Cameroun 2 (2) - 100%Sitindustrie Tubes & Pipes 15 (15) - n.s.Phoceenne Chili 11 (11) - 100%Phoceenne Caracas 9 (9) - 100%Lab Systems LLP - - - 50%Genoyer Angola LDA - - - 49%Vitjoint - - - n.cTotal 3,381 (37) 3,344 - Entities for which consolidation is not significant or which are dormant or over which the Group has

no significant influence or control are not consolidated.

2.5 BREAKDOWN OF TRADE RECEIVABLES (in thousands of Euros) 31-Dec-12 31-Dec-11

Trade receivables 86,969 84,469Accrued income 367 66Promissory notes 219 253

Gross value 87,555 84,788

Provision for doubtful accounts (259) (281)

Net value 87,295 84,506 Trade receivables are due within one year.


16

2.6 BREAKDOWN OF OTHER RECEIVABLES


Suppliers - Credit notes 701 952Receivables from sale of assets - -Taxes to be recovered - Income Tax 260 384Taxes to be recovered - VAT and other 4,395 4,258Group tax consolidation receivables 24 919Financial receivables 1 8 298Other receivables 1 757 643

Gross value 7,138 15,454

Provision on other receivables (146) (151)

Net Value 6,992 15,303

Other receivables are due within one year.

2.7 CASH AND CASH EQUIVALENTS

At December 31, 2012 the cash and cash equivalents of the Group are mainly composed of bank

accounts. The Group does not hold any listed shares or any other financial investments.

2.8 DEFERRED EXPENSES RELATED TO FINANCIAL BORROWINGS

Borrowing costs of 1,115 thousand Euros gross are fully depreciated.


17

2.9 CHANGES IN SHAREHOLDERS’ EQUITY


Share capital

Merger reserve

Legal Reserve

Consolidated reserve

Profit/(loss) for the period

Investment grants

Cumulative currency

translation adjustment

Total

Balance at December 31, 2010 61,179 - 6,118 43,660 13,299 64 (889) 123,431

Scope exit (153) 164 11Allocation of prior year earnings 13,299 (13,299) -Profit for the period 12,532 12,532Dividends distribution (4,334) (4,334)Change in grants received 63 63Change in translation differences 437 437

Balance at December 31, 2011 61,179 - 6,118 52,471 12,532 127 (288) 132,139

Allocation of prior year earnings 12,532 (12,532) -Profit for the period 11,481 11,481Dividends distribution -Change in grants received 35 35Change in translation differences 69 69Scope exit 13 (13) -Merged profit 18 (18) -

Balance at December 31, 2012 61,179 18 6,118 64,998 11,481 162 (232) 143,725

The changes in minority interests are as follows:

(in thousands of Euros) 2012 2011

Minority interests at January 1 39 548

Profit/(Loss) for the period (17) (94)Change in translation differences 2 (11)Changes in the consolidation scope 1 (404)

Minority interests at December 31 25 39


18

2.10 PROVISION FOR OTHER LIABILITIES AND CHARGES

(in thousands of Euros) Opening Additions Closing

31-Dec-11 31-Dec-12

Total 7,397 3,491 (1,177) (1,499) - 55 8,267Provisions for liabilities 4,487 2,167 (813) (1,292) - 38 4,587Provisions for claims and customer risk 4,319 2,079 (758) (1,292) - (102) 4,246Provisions for restructuring 168 88 (55) - - 140 341 Provisions for other risks - - - - - - - Provisions for charges 2,910 1 324 (364) (207) - 17 3,680Provisions for pension liabilities and jubilees 2,527 1 317 (339) (187) - 13 3,332Other provisions for charges 383 7 (26) (20) - 4 348

Operating profit 815 Financial income 2 Extraordinary items - Impact on net income 816

Other changes (incl. changes in

exchange rate)

Change in consolidation

scope

Unused amounts reversed

Used during the period

Concerning the pension obligations related to Munro Miller, the provision equals the difference

between the fair value of the plan assets and the actual value of the obligations as displayed

hereunder:


Fair value of the assets 5,683 5,303Actual value of the pension plan 6,964 6,008Deficit of the plan (1,281) (705)

These elements are not to be settled in the short or medium term and their valuations are likely to

change before they are settled.

The main actuarial assumptions used to calculate the pension obligations are as follows:

UK France (a) Germany RomaniaInflation rate 3,05% 1,60% 2,00% 3,90%Discount rate 4,30% 3,25% 3,50% 5,50%Turnover rate n.a. 5% à 16% 4,50% 8,00%Return on plan assets 0,5% à 7,4% n.a. n.a. n.a.Age of retirement (years) 65 65 to 67 62 to 63 63 to 67

(a) Social charges rate of 42% assuming voluntary retirements


19

2.11 BREAKDOWN OF DEFERRED INCOME TAXES


Acquired assets at fair value (226) (228)Carry forward tax losses 2,833 3,270Pension obligations 535 437Temporary differences (146) (66)Regulatory provisions (505) (401)Intercompany provisions (665) (782)Intercompany margin on inventories 697 382Internal operations (516) (511)Deferred expenses - -Fixed assets amortization harmonization (141) (122)Other 39 (138)Deferred income tax - net 1,903 1,842

Deferred income tax - assets 3,413 3,718Deferred income tax - liabilities (1,510) (1,876)Deferred income tax - net 1,903 1,842

The reconciliation between the reported income tax expense and the theoretical amount that would

arise using the tax rate in France is as follows:

31-Dec-12 31-Dec-11

(in thousands of Euros)Profit before income tax 16,645 13,469

Income tax calculated at the tax rate in France (33.33%) (5,548) (4,489)

Effect of different tax rates in foreign countries 1,794 1,546Differences on goodwill amortization (90) (15)Variation of non recognised deferred tax (871) 527Permanent differences (345) (79)Other (122) 1,480

NET INCOME TAX (PROFIT) / EXPENSE (5,181) (1,031)


20

2.12 ANALYSIS OF BORROWINGS AND FINANCIAL DEBTS

(in thousands of Euros) 31-Dec-12 31-Dec-11Shareholder's current account 9,482 34,264Bank borrowings 872 15Bank overdrafts 113 109Financial leases 492 510Total Borrowings 10,959 34,897Cash and cash equivalents 33,838 42,808Financial receivables 1 8,298Net debt (22,880) (16,209)

Short Medium Long TotalTerm Term Term 31-Dec-12

(in thousands of Euros) < 1 yr 1 yr < > 5 yrs > 5 yrsShareholder's current account 9,482 - - 9,482Bank borrowings 872 - - 872Bank overdrafts 113 - - 113Financial leases 39 453 - 492

Total borrowings 10,506 453 - 10,959

On July 9, 2010, the company entered into a revolving credit facility agreement and a master

agreement for the issuance of bonds, bank guarantees and stand-by letter of credit, for three years

duration. This agreement requires adherence to a ratio. This ratio is calculated every six months on a

basis of a twelve month rolling period. Calculations show that the company is in compliance with this

ratio.


21

2.13 BREAKDOWN OF TRADE PAYABLES


Suppliers 33,653 48,250Promissory notes 86 119Accrued expenses 29,290 15,088

Trade payables 63,029 63,457

2.14 BREAKDOWN OF OTHER PAYABLES AND ACCRUALS


Credit notes 3,603 1,147Contractual duties 2,082 2,279Sundry creditors 132 136Group tax consolidation payables 918 153Other 546 1,054

Other payables and accruals 7,281 4,769


22

3. NOTES TO THE INCOME STATEMENT

3.1 BREAKDOWN BY MAJOR ACTIVITY


Trading / Services 192,779 199,801Manufacturing 111,476 95,881

Net sales 304,255 295,682

The classification of the subsidiaries by major activity is displayed in the Note “Subsidiaries included

in the consolidated financial statements”.

3.2 NET CHANGE IN PROVISIONS


Reversal of / (Additions to) net on provisionsOn working capital (455) 330On other liabilities and charges (815) 904

Total (1,270) 1,234

3.3 OTHER OPERATING PROFIT / (LOSS)


Penalties accrued net of penalties received (2,179) (1,137)Other operating income 544 781 Other operating expenses (144) (116)Losses on receivables (65) (46)

OTHER OPERATING PROFIT / (LOSS) (1,844) (518)

Other operating income includes mainly the capitalized production for an amount of 426 thousand

Euros.


23

3.4 NET FINANCIAL INCOME / (LOSS)


Interest income 410 783Net exchange gain / (loss) (296) 1,155Net change in financial provisions (2) 673Interest expense (341) (702)Other financial items - -

NET FINANCIAL INCOME / (LOSS) (229) 1,908 3.5 EXCEPTIONAL PROFIT / (LOSS)


Exceptional provisions for other liabilities, charges and exceptional depreciation - - Capital gain / (loss) on sale of assets 11 11Other items 591 (452)

EXCEPTIONAL PROFIT / (LOSS) 602 (441)

3.6 EBITDA BEFORE RESTRUCTURING, ENVIRONMENT AND HEALTH AND SAFETY COSTS

EBITDA is calculated from net income or loss by reinstating interest income and interest expense,

changes in financial provisions, income taxes, gain or loss from disposal of discontinued operations,

amortization of intangible and tangible assets, amortization of goodwill, restructuring expenses

including changes in provisions, and environment, health and safety related expenses including

changes in provisions. The minority interest is excluded from the calculation.


24

4 OTHER INFORMATION

4.1 PERSONNEL

As at December 31, 2012, the Group employed 1,104 people of whom 415 work for Vilmar in

Romania. At year-end the headcount breakdown is as follows:

31-Dec-12 31-Dec-11

Executives 148 149

Employees, technicians, controllers 346 336

Manual workers 610 541

Total 1,104 1,026

4.2 COMMITMENTS AND CONTINGENT LIABILITIES


Guarantees given

Forward exchange hedging contracts 27,291 29,288

Comfort letters and letters of intention 7,012 6,714

Guarantees given related to operations 31,258 40,626

Guarantees received

Comfort letters 1,721 1,861

Guarantees received related to operations 15,195 7,094

The Group hedges its foreign exchange positions on import and export transactions mainly by

entering into foreign currency forward exchange contracts. Such transactions are recorded at the

forward hedging rate. Those forward exchange contracts enable the hedging of a part of the

commitments related to the backlog.

Guarantees given or received related to operations are mainly contracted through banks in order to

ensure the satisfactory completion of contracts.


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4.3 SHARE CAPITAL

The share capital of the company Genoyer SA is made up of 1,605,233 ordinary shares and amounts

to € 61,179,048.

4.4 MANAGEMENT WAGES AND BENEFITS

The aggregate amount of the wages and benefits granted to management for their functions as

directors or as members of the Board is not disclosed as it would involve providing information

regarding individuals.

4.5 GROUP TAX CONSOLIDATION

The French companies Genoyer SA, SBS, RTI, BSL Pipes & Fittings and TTB are included in the Genoyer

International group tax consolidation.

The Group benefits from the following tax group :

Countries Companies members of tax group

United Kingdom FithandelMunro & MillerBon Accord EngineeringPhoceenne UKSFS


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4.6 OTHER RELATED PARTY TRANSACTIONS

As at December 31, 2012, the consolidated income statement includes transactions with related parties:

� Management fees and other expenses charges by Genoyer International SAS amounting to

3,885 thousand euros, other expenses charged by Genoyer SA to Genoyer International SAS for 476

thousand euros.

� Financial interest expense amounting to 112 thousand euros related to current account with the

shareholder Financière Genoyer and Genoyer International (i.e. 2.12).


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SUBSIDIARIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENTS Method of

consolidation% of

interestBusiness Division

FRENCH SUBSIDIARIES

GENOYER SA 9/11 rue de Lisbonne - 13742 Vitrolles (France) - SIREN : 063 803 704 Parent company 100 T/S

SPECIAL BRIDES SERVICE 42130 Boën sur Lignon (France) - SIREN : 330 927 377 Full 100 M

RTI INDUSTRIES22 route de Crêton Les Culs Menaux - 18110 Vasselay - (France)SIREN : 329 691 000

Full 100 M

BSL PIPES & FITTINGS108, route de Reims - 02200 Billy sur Aisne (France) SIREN : 432 329 639

Full 100 M

TTB, TECHNOLOGICAL TUBES & BELLOWSQuai de l'Oise - Zone Industrielle - 60 870 RIEUX SIREN : 407 713 775

Full 100 M

FOREIGN SUBSIDIARIES

PHOCEENNE UK LIMITED 27 New Bond street, London WIY 9HD (UK) Full 100 T/S

FITHANDEL (Scotland) LIMITED Unit 1 Woodside Road-Aberdeen AB28EF- Scotland - (UK) Full 100 T/S

SPECIAL FLANGE SERVICES LIMITED 27 New Bond Street, London W1S 2RH (UK) Full 100 M

MUNRO & MILLER FITTINGS LIMITEDEast Mains Industrial estate - Broxburn EH52 5AU West Lothian Scotland (UK)

Full 100 M

BON ACCORD ENGINEERING SUPPLIES (CASPIAN) LIMITED

Unit 1 Woodside Road-Aberdeen B 23 8 EF Scotland - (UK) Full 100 T/S

PIPELINE TECHNOLOGY LLPEnterprise House - Beeson's Yard - Bury Lane- Rickmansworth - Hertfordshire W3D 1DS (UK)

Equity method 50 T/S

PHOCEENNE BV Beechavenue 54-80, 1119 PW Schipol Rijk (Netherlands) Full 100 T/S

VILMAR SA Platforma Industriala n°1- Ramnicu Vilcea (Romania) Full 100 M

WILHELM GELDBACH INDUSTRIE GmbH

Ziegelstraβe 17, D-45886 Gelsenkirchen (Germany) Full 100 M

UTM 40 Bd Joseph II - 1840 Luxembourg Full 100 NA

PHOCEENNE SRL Piazza Manin 4/3 - Genova 16122 - (Italy) Full 100 T/S

COLVES FLUID CONTROL SRL Via F.Serpero 20060 Masate - Milan (Italy) Full 100 M

PHOCEENNE SA Plazza de Castilla 3, Planta 8°A, 28046 Madrid (Spain) Full 100 T/S

PHOCEENNE MEXICO, SA de CVSanta Margarita 108 302 Col Del Valle - Mexico Distrito Federal CP 03100 (Mexico)

Full 100 T/S

GENOYER GROUP, INC 16360 Park Ten Place - #300 Houston - 77084 - Texas (USA) Full 100 T/S

DL FLANGE CORPORATION 77-85 Little York Houston Texas 77018 (USA) Full 100 M

DL FLANGE CANADA INC 6346 Roper Rd - Admonton, Alberta, T6B 3P9 - CANADA Full 100 M

Nipon International Trading CorporationNishishimbashi Yasuda Union Building 3F 4-2, Nishishimbashi2 chome,Minato-ku, Tokyo 103-0005 (Japan)

Full 100 T/S

PHOCEENNE ASIA PTE LTD 80 Robinson Rd - # 02 00 - 06 8898 SINGAPORE Full 100 T/S

GENOYER PHOCEENNE TRADING (SHANGHAI), Co. LTD

Suite 1606, Hai Bo Plaza- N°101 Nanmantou Rd -200125 Pudong New District, Shanghai (P. R. China)

Full 100 T/S

PT PHOCEENNE INDONESIA Plaza Permata JI Jalan MH Thamrin n°57 - 10350 Jakarta – (Indonesia) Full 99 T/S

PHOCEENNE AUSTRALIA PTY LTD 1060 Hay Street, West Perth 6005, WA (Australia) Full 100 T/S

NANTONG COLVES FLUID CONTROL, Co. LTD

West Side Guoquiang Road, North Side N°190, North Outer Ring Road, Nantong, Jiangsu Province 226011 (P.R.China)

Full 90 M

GENOYER ALGERIE Vila 134 - Bois des Cars - Dely Ibrahim - 1320 ALGER Full 70 T/S

PHOCEENNE CONGO Pointe Noire BP 1226 (République du Congo) Full 99 T/S

PHOCEENNE NIGERIA11a Grace Anjous Drive Off Adebayo Doherty Way Lekki Phase 1, Lagos

Equity method 24 T/S

VFTC Nantong, Jiangsu Province 226011 (P.R.China) Full 100 T/S

GENOYER DO BRASIL Avenida Beira Mar, 262, 6° Andar Rio de Janeiro, CEP 20021-060 Brasil Full 100 T/S

Business Division : T/S: Trading / Services activity; M: Manufacturing activity; NA: Not allocated


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KPMG PricewaterhouseCoopers Audit 1, Cours Valmy Les Docks – Atrium 10.1 F-92923 Paris la Défense Cedex 10, Place de la Joliette B.P. 81525 13567 Marseille Cedex 2 STATUTORY AUDITOR’S REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS (For the year ended 31 December 2012) To the Shareholders Genoyer S.A. 9/11, Rue de Lisbonne Zone Industrielle 13742 Vitrolles Cedex

In compliance with the assignment entrusted to us by your general meeting, we hereby report to you, for the year ended 31 December 2012, on:

� the audit of the accompanying consolidated financial statements of Genoyer S.A ;

� the justification of our assessments;

� the specific verification required by law.

These consolidated financial statements have been approved by the board of directors. Our role is to express an opinion on these consolidated financial statements based on our audit.

I - Opinion on the consolidated financial statements

We conducted our audit in accordance with professional standards applicable in France; those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit involves performing procedures, using sample techniques or other methods of selection, to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made, as well as the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

In our opinion, the consolidated financial statements give a true and fair view of the assets and liabilities and of the financial position of the Group as at 31 December 2012 and of the results of its operations for the year then ended in accordance with the accounting rules and principles applicable in France.


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II - Justification of our assessments

In accordance with the requirements of article L.823-9 of the French Commercial Code (code de commerce) relating to the justification of our assessments, we bring to your attention the following matters:

Provision for impairment of current assets:

Your group records provisions for impairment to cover risks on the net realizable value of inventories and accounts receivable as described in note 1.5 to the consolidated financial statements.

Accounting for deferred taxes:

Deferred income tax assets relating to tax losses and other temporary differences are recognized by your Group only to the extent that it is probable that they will be recoverable in the future, as set out in note 1.7 to the consolidated financial statements.

We carried out our assessment of the approach used by the Group based on the information available at the time and we performed tests to verify the proper application of these methods. In our opinion these estimates are reasonable.

These assessments were made as part of our audit of the consolidated financial statements taken as a whole, and therefore contributed to the opinion we formed which is expressed in the first part of this report.


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III - Specific verification

As required by law, we have also verified in accordance with professional standards applicable in France the information presented in the Group’s management report.

We have no matters to report as to its fair presentation and its consistency with the consolidated financial statements. Paris La Défense and Marseille, on 10 June 2013 The statutory auditors

KPMG Audit PricewaterhouseCoopers Audit Département de KPMG S.A.

Axel Rebaudières Vincent Thyssen Associé Associé


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KPMG PricewaterhouseCoopers Audit 1, Cours Valmy Les Docks – Atrium 10.1 F-92923 Paris la Défense Cedex 10, Place de la Joliette B.P. 81525 13567 Marseille Cedex 2 RAPPORT DES COMMISSAIRES AUX COMPTES SUR LES COMPTES CONSOLIDES (Exercice clos le 31 décembre 2012) Aux actionnaires Genoyer S.A. 9/11, Rue de Lisbonne Zone Industrielle 13742 Vitrolles Cedex

En exécution de la mission qui nous a été confiée par votre assemblée générale, nous vous présentons notre rapport relatif à l’exercice clos le 31 décembre 2012, sur : - le contrôle des comptes consolidés de la société Genoyer S.A, tels qu’ils sont joints au présent

rapport; - la justification de nos appréciations ; - la vérification spécifique prévue par la loi. Les comptes consolidés ont été arrêtés par votre directoire. Il nous appartient, sur la base de notre audit, d’exprimer une opinion sur ces comptes.

I - Opinion sur les comptes consolidés

Nous avons effectué notre audit selon les normes d’exercice professionnel applicables en France ; ces normes requièrent la mise en œuvre de diligences permettant d'obtenir l'assurance raisonnable que les comptes consolidés ne comportent pas d'anomalies significatives. Un audit consiste à vérifier, par sondages ou au moyen d’autres méthodes de sélection, les éléments justifiant des montants et informations figurant dans les comptes consolidés. Il consiste également à apprécier les principes comptables suivis, les estimations significatives retenues et la présentation d’ensemble des comptes. Nous estimons que les éléments que nous avons collectés sont suffisants et appropriés pour fonder notre opinion.

Nous certifions que les comptes consolidés sont, au regard des règles et principes comptables français, réguliers et sincères et donnent une image fidèle du patrimoine, de la situation financière, ainsi que du résultat de l'ensemble constitué par les personnes et entités comprises dans la consolidation.


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II- Justification de nos appréciations

En application des dispositions de l’article L.823-9 du Code de commerce relatives à la justification de nos appréciations, nous vous informons que les appréciations auxquelles nous avons procédé ont porté sur le caractère approprié des principes comptables appliqués.

Estimations comptables :

Provision pour dépréciation des valeurs d’exploitation :

Votre Groupe constitue des provisions pour couvrir les risques sur la valeur nette de réalisation des stocks et des créances clients, tel que décrit en note de 1.5 de l’annexe.

Comptabilisation des impôts différés :

Les actifs sur pertes fiscales reportables et différences temporaires ne sont inscrits à l’actif de votre Groupe que lorsque leur utilisation future est probable, tel que décrit en note 1.7 de l’annexe.

Nous avons procédé à l’appréciation des approches retenues par le Groupe sur la base des éléments disponibles à ce jour, et mis en œuvre des tests pour vérifier par sondage l’application de ces méthodes. Nous avons procédé à l’appréciation du caractère raisonnable de ces estimations.

Les appréciations ainsi portées s’inscrivent dans le cadre de notre démarche d’audit des comptes consolidés, pris dans leur ensemble, et ont donc contribué à la formation de notre opinion, exprimée dans la première partie de ce rapport.


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III - Vérification spécifique

Nous avons également procédé, conformément aux normes d’exercice professionnel applicables en France, à la vérification spécifique prévue par la loi des informations relatives au groupe données dans le rapport de gestion.

Nous n'avons pas d'observation à formuler sur leur sincérité et leur concordance avec les comptes consolidés.

Marseille et Paris La Défense, le 10 Juin 2013

Les commissaires aux comptes

Documents

Comptes consolidés 2011 - Genoyer€¦ · Provisions and deferred taxes 9,777 9,273 Provisions for other liabilities and charges 2.10 8,267 7,397 Deferred income tax liabilities