Annual / Quarterly Financial Statement • Jun 16, 2013
Annual / Quarterly Financial Statement
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Kapsch TrafficCom
always one step ahead
| n | Management Report 3 | |
|---|---|---|
| n | Statement of all Members of the Managing Board 22 | |
| n | Additional Information pursuant to Section 82 Para. 4 No. 3 BörseG 23 | |
| n | Consolidated Financial Statements as of 31 March 2013 24 | |
| n | Notes to the consolidated financial statements 28 | |
| n | Notes on individual items in the income statement and balance sheet 47 | |
| n | Auditor's Report 74 |
| n | Management Report as of 31 March 2013 77 | |
|---|---|---|
| n | Statement of all Members of the Managing Board 91 | |
| n | Additional Information pursuant to Section 82 Para. 4 No. 3 BörseG 92 | |
| n | Balance Sheet as of 31 March 2013 93 | |
| n | Income Statement for the fiscal year 2012/13 94 | |
| n | Notes to the financial statements for the fiscal year 2012/13 95 | |
| n | Auditor's Report 107 |
Consolidated Financial Statements as of 31 March 2013.
In the reporting year 2012/13, the growth of the world economy was primarily shaped by the still unresolved debt crisis in Europe: As a consequence, the eurozone slipped into a recession, with a decline in real gross domestic product (GDP) of 0.6%. However, growth-dampening effects on the global economy came not only from the eurozone: The strong fiscal consolidation – underway throughout the OECD – is estimated to have subtracted some 1 to 1.5 percentage points from OECD-wide growth in 2012. Taking this into account, the economy of the OECD area expanded by 1.4% in 2012, compared to 1.8% in 2011. Additionally, the traditional growth drivers of the global economy – the Emerging Markets – saw unexpectedly sharp slowdowns in their economic performance in the reporting year, which was due, in part, to weaker export growth as well as to the restrictive course of their economic policies in the years before. All in all, global economic growth slowed to 3.2% in 2012 from 3.9% in 2011.
In the United States, GDP growth slowed markedly in the fourth quarter of 2012, as global uncertainty increased and restrictive government spending dampened economic activity. The economic dynamic weakened, with GDP falling to a year-on-year rate of 1.6% in Q4 2012, compared to 2.6% in Q3. For the reporting year as a whole, GDP increased by 2.2%. Some impetus came from gross fixed-capital formation, which accelerated in the reporting year, while private consumption, traditionally one of the main drivers of the economy in the U.S.A., lost steam.
Looking ahead, U.S. economic growth is expected to drop to approximately 2% in 2013 and concerns remain, especially regarding the fiscal situation: Like the eurozone, the United States needs to restore fiscal sustainability. As the White House and Congress could not reach a compromise on the federal budget, "sequestration" came into force at the beginning of March 2013, with automatic expenditure cuts totaling 1.2 trillion U.S. dollars over the next ten years, which will have a dampening effect on U.S. economic development.
In Japan, the recovery of the economy stalled in the second half of 2012, after strong growth in the first six months supported by reconstruction spending in response to the earthquake in March 2011. In 2012 as a whole, the economy expanded by 1.6%.
As reconstruction expenditures wane further and planned tax hikes dampen private consumption, the OECD expects that GDP growth will slow to 0.7% in 2013. Furthermore, Japan's fiscal situation remains critical: The budget deficit reached a level of about 10% of GDP in 2012, and government debt rose to around 214% of total economic output. At the beginning of April 2013, the Bank of Japan announced a massive monetary-easing program which aims to double the monetary base by the end of 2014. The bank's primary intention is to stimulate the economy which has been struggling with deflation for years and has grown only modestly in this time.
The reporting year witnessed a further slowdown in economic development in a number of emerging markets, although they regained some ground in the last quarter of the year 2012. Forward-looking indicators suggest that this growth momentum is spilling over into 2013. Given the substantial share of the world economy now accounted for by emerging economies, they will drive growth on a global level again.
To take China, real GDP increased by 7.9% in Q4 2012 compared with the corresponding period in 2011, and an estimated GDP growth rate of 8.2% is expected for 2013, buoyed by the rise in domestic demand toward the end of 2012. Turning to India and Brazil, their economic performance remained subdued in 2012, with growth rates of 4.5% (India) and 1% (Brazil). The International Monetary Fund (IMF) expects growth in these two emerging markets to be back on track in 2013 with rates of 5.9% and 3.5%. The short-term outlook for the region "Emerging Markets and Developing Economies" indicates a rise in GDP of 5.5% in 2013.
Just like in the previous year, the course of the European economy in 2012 was influenced primarily by the economic and sovereign-debt crisis. As a result of the persistently difficult situation in the Southern periphery, the aggregate GDP of the EU-27 decreased by 0.3%. It is worth mentioning, though, that the core of the European Union was not spared the repercussions of the crisis either. France and Great Britain, for instance, saw their economies stagnate in 2012. Even the German growth engine started to sputter towards the end of the year. Experts believe this to be the bottom of the latest recession phase. Economic performance of the EU-27 is forecast to pick up in 2013, albeit only very slowly (+0.1%). It is nonetheless essential that austerity measures continue to be implemented throughout Europe.
As far as the eurozone is concerned, concerted efforts to fight the economic crisis in the Southern member states were once again at the top of the agenda. The situation in Greece proved particularly difficult, seeing as the economy of the country has been stuck in a downward spiral for five years. Meanwhile, Spain also made the headlines due to its struggling banking sector, as did Italy after the reformist government led by Mario Monti had been voted out of office. Both countries faced a deep recession in 2012, just like Portugal. The only PIIGS state that seems to have overcome its severe problems is Ireland: Two consecutive years of GDP growth indicate that the economic turnaround has succeeded, not least owing to the EU rescue package. At the same time, though, Cyprus caused a new wave of uncertainty on the financial markets.
Overall, the economic prospects for the eurozone remain subdued. Having decreased by about 0.5% in Q4 2012, aggregate GDP is not expected to expand in the first months of 2013 either. Only for the second half of the year do experts forecast a moderate recovery in the economy.
The economic slowdown in the eurozone has also had repercussions for the states in Central and South Eastern Europe. Even though GDP growth in the region as a whole was more pronounced than in Western Europe, economic performance on a national level varied markedly in 2012. In Hungary, for instance, the on-going crisis led to a GDP decrease of 1.7%. The Slovenian economy also contracted as a result of massive problems in its banking sector (-2%), and the future 28th EU member Croatia struggled noticeably as well (-1.8%). In contrast, comparatively robust growth rates were reported for Russia, Poland and the Baltic states. Looking ahead, experts predict that economic activity in the region will expand only slightly faster in 2013, as both export and domestic demand are to remain fairly weak. The year after that, however, is most likely to witness stronger growth again.
Austria. In 2012, Austria saw a deceleration in economic performance: GDP growth decreased from 2.7% in the previous year to 0.8%. The second half of 2012, in particular, was marked by a loss of momentum due to weaker stimuli from abroad.
The latest forecasts suggest, however, that the bottom was reached at the end of the year. With several leading indicators now looking up, the Austrian economy is set to return to a growth path in 2013, albeit a flat one. Experts predict a GDP increase of about 1%, driven first and foremost by growing business confidence. Most notably, the manufacturing industry expects order intake to pick up again.
To allow for easier comparisons, the Kapsch TrafficCom Group makes use of the internationally prevailing terms for the intelligent transportation systems (ITS) market. These are systems in which information and communication technologies are employed to support and optimize road transportation, including infrastructure, vehicles, users and industry.
Market segmentation. The study "Intelligent Transportation Systems – A global strategic business report" from Global Industry Analysts, October 2012, describes the ITS market as a diversifying market with widely differing application and product segments. The market comprises the following product segments:
Market volume and growth. According to Global Industry Analysts (October 2012), the volume of the ITS market amounted to USD 14.2 billion in 2012 and is expected to continue growing. The largest product segment in 2012 was ATMS, accounting for almost 36% (USD 5.2 billion). Based on a worldwide volume of about USD 3.5 billion, ETC had an ITS market share of about 25%. The largest geographic region for ITS in 2012 was the U.S.A. at 40% (ETC: 42%), followed by Europe at 30% (ETC: 27%).
The ITS market is expected to grow at an average annual rate of 8.7% between 2009 and 2018 to reach USD 22.8 billion in 2018, of which ETC will account for USD 6.8 billion equaling a share of 30% and thereby exhibiting the fastest growth of all product segments at an average annual rate of 11.8%.
Funding for infrastructure projects. The worldwide increase in road traffic requires additional financing to construct new and maintain existing roads. Toll collection offers a constant source of income and thus helps governments to provide the necessary funding for infrastructure projects. Efficient toll collection systems, especially electronic ones, offer a significant, constant and sustainable source of additional funds for governments, public authorities and concessionaires that can be used for the expansion and maintenance of road infrastructure.
The demand for the construction of new roads is largely generated by the worldwide increase in road traffic. Especially in Asia, an increased demand for electronic toll lanes is expected for the replacement and expansion of toll collection systems previously based on more traditional (manual) systems. Aside from general economic aspects, the worldwide increase in road traffic is probably the most important driver for the ITS market. According to analyses by the EU (European Union 2010, "Energy and Transport in Figures"), commercial traffic increased by 2.3% per year and by 33.7% in total between 1995 and 2008. Commercial road traffic increased by 2.9% per year and by 45.7% in total. While the recent economic crisis triggered a fall in the volume of goods transport, this has already been largely compensated for by the subsequent upswing. Despite political pressure, goods transports could not be shifted significantly from road to rail or ship.
In 2005, the trans-European road network (TEN-V) had a total length of 84,700 km and comprised one-fourth of the primary street network but carried 40% of the total commercial traffic. It is predicted that TEN-V will be expanded by 4,800 km per year up to 2020, of which 3,500 km will consist of existing roads. Major investments will be required in the new EU member states and along the corridor routes to these countries. In the white paper "European transport policy for 2010", the European Union estimated that investments of EUR 600 billion will be required by 2020. The long-term forecasts for traffic growth remain high.
In addition to the construction of new roads, the high financing requirements for the preservation of the road infrastructure are another factor driving the ITS market. The high funding requirements in the U.S.A. (Standard & Poor's research estimates an annual demand of USD 92 billion for the preservation of highways and bridges and a further USD 125.6 billion for their improvement up to 2020) are leading to new business models and private concessionaire models.
Reducing congestion and further environmental pollution caused by road traffic. Efforts to reduce environmental pollution due to road traffic have become a market driver for the introduction of toll collection systems. Such systems encourage reduced or modified vehicle usage, thereby lowering emissions and pollution levels. Electronic toll collection systems, in particular for multi-lane free-flow traffic, have proven their ability to decrease environmental pollution and carbon dioxide emissions by reducing congestion at toll plazas without interfering with the traffic flow.
In large conurbations and capital cities, in particular, there is a growing need for electronic systems to control and reduce traffic. Toll collection is largely perceived as an effective solution for reducing high levels of congestion, particularly in metropolitan areas, as mandatory payments for road usage encourage carpooling or the use of public transportation. Systems for city charging and enforcing low-emission environmental zones are deployed by cities to reduce traffic congestion and environmental pollution. Due to the politically sensitive nature of this topic, this portion of the business has developed more slowly than originally expected.
Traffic safety devices to monitor compliance with traffic regulations are another field of ITS applications in cities. Examples include systems to monitor traffic violations at junctions (e.g. running red lights) as well as systems to detect speeding. The market potential of these applications is growing rapidly in cities as well as interurban areas. For municipal authorities, they often pave the way for larger and more extensive ITS solutions, such as city charging.
Increasing traffic safety and security. Advanced traffic management systems lower accident rates while also helping increase the probability of surviving accidents. The addressees include governments and regional authorities as well as other organizations, such as concessionaires, that are engaged in developing transport policies utilizing ITS in order to ensure the availability and quality of traffic infrastructure in a way that improves safety, performance, security and environmental protection.
Enhancing vehicle and fleet productivity. Vehicle-oriented intelligent transportation systems are aimed at in-car telematics such as remote diagnostics or advanced driver assistance systems. Their purpose is mainly to enhance vehicle productivity, particularly that of commercial vehicles (commercial vehicle operations), as well as traffic safety and security. This field includes systems for the real-time interaction between vehicles (vehicle-to-vehicle; V2V) as well as between vehicles and infrastructure (vehicle-to-infrastructure; V2I), which Kapsch TrafficCom believes will increasingly be based on 5.9GHz technology.
Industry-oriented intelligent transportation systems are commercial applications designed to reduce the costs or maximize the revenue of vehicle fleet operators, including public transportation companies (public vehicle transportation management systems). Examples include systems for fleet management and for collecting information on the logistics of large-scale vehicle operators. Addressees are also insurance companies, who see pay-as-you-drive car insurance as a promising way to attract new customers by offering fair insurance rates and ITS-based value-added mobility services.
Increased comfort expectations of travelers. User-oriented intelligent transportation systems are focused mainly on convenience and efficiency for travelers. The customer in the car receives information to aid in orientation, thereby increasing traffic safety. Example applications for advanced vehicle information systems include transmitting traffic-related vehicle information to travelers before or during the trip as well as navigation services. As a communication platform, the 5.9 GHz technology will enable a variety of future applications involving connected vehicles.
Depending on the requirements of the specific application, systems are introduced for toll collection which are based on microwave technology (dedicated short-range communication; DSRC), satellite navigation (global navigation satellite system; GNSS), or automatic number plate recognition (ANPR).
While in Europe the standardized technology is based on 5.8 GHz according to the Comité Européen de Normalisation (CEN) standard, toll systems in North America are based on proprietary protocols in the 915 MHz band. It is expected that a new communication protocol standard based on 5.9 GHz will gradually replace the existing technology in the U.S.A. over the coming years. In addition to the toll application, the communication standard 5.9 GHz WAVE (Wireless Access in the Vehicular Environment) is intended for real-time vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I) communication, abbreviated as V2X, for applications that increase traffic safety as well as additional ITS solutions for traffic information, traffic management and entertainment.
A common thread among all these forces driving the market is a convergence on the ITS market expected by Kapsch TrafficCom over the next five to ten years. The company is convinced that applications, platforms and technologies will become increasingly interconnected and converge over time. In the view of Kapsch TrafficCom, the future lies in "connected vehicles in cooperative systems", which are V2X cooperative systems for real-time vehicle-to-vehicle (V2V) or vehicle-to-infrastructure (V2I) communication.
The revenues of Kapsch TrafficCom Group reached EUR 488.9 million in fiscal year 2012/13, down by 11.1% compared to the previous fiscal year. 70.0% of the revenues were achieved in the segment Services, System Extensions, Components Sales (SEC) that accounts for the recurring part of the business. The segment Road Solution Projects (RSP) that encompasses the project business showed significantly lower revenues (down by 26.2%) than in the previous year as ongoing and new projects did not generate comparable revenues and also fall short of the volume of the Polish implementation project that was realized last fiscal year.
In addition to the two large existing projects in South Africa and Belarus, which significantly impacted fiscal year 2012/13, the following additional projects were acquired:
Major changes and events at a corporate level during fiscal year 2012/13 include the following:
The revenues of the Kapsch TrafficCom Group reached EUR 488.9 million in fiscal year 2012/13, down by 11.1% compared to the previous fiscal year (EUR 549.9 million). The segment Services, System Extensions, Components Sales (SEC) exhibited a growth in revenue, while the segment Road Solution Projects (RSP) showed significantly lower revenues than in the same period of the previous year.
The operating result (EBIT) of the Kapsch TrafficCom Group was at EUR 15.3 million and therefore 63.9% lower than the previous year (EUR 42.2 million). The EBIT margin amounted to 3.1% (previous year: 7.7%).
In the segment Road Solution Projects (RSP), revenues were reduced by 44.2 % to EUR 128.3 million (previous year: EUR 229.9 million). The most significant factor for the decline in a year-on-year comparison was the completion of the implementation of the nationwide electronic truck toll collection system in Poland during the previous year. The project for the implementation of an electronic toll collection system in the South African province of Gauteng made no comparable contribution since it is already in the finalization phase and the originally expected revenues cannot be earned in full until the commissioning takes place. The new projects in Belarus, France, Australia and the U.S.A. as well as the extensions in Poland were also unable to compensate for this fall in revenue during fiscal year 2012/13.
The EBIT of the segment RSP was at EUR -51.7 million (previous year: EUR 4.1 million). As a result of the decreased revenues in comparison with the previous year, it was not possible to cover the regular costs associated with this segment, the continued expenditures for entry into new markets such as the U.S.A., Russia, Hungary, Slovenia and Singapore as well as the upfront costs for ongoing and upcoming tenders. Moreover, the project for the implementation of an electronic toll collection system in the South African province of Gauteng additionally weighed down the results. The reasons for this lie in the delay of the commissioning as a result of political discussions, the lower revenues than initially expected prior to the commissioning and additionally incurred costs and standby costs.
EUR 342.3 million (previous year: EUR 308.1 million). The operation project in Poland, which began in July 2011 and was therefore only relevant for nine months of the previous year, supplied a significant revenue contribution. The technical and commercial operation of the nationwide system in the Czech Republic and the technical operation including maintenance of the nationwide systems in Austria and Switzerland continued to provide stable revenue contributions. In contrast, the delayed start of the project in the South African province of Gauteng resulted on the one hand in revenues for the upkeep of the operational readiness that are lower compared to the ordinary revenues and on the other hand this led to the absence of the expected deliveries of on-board units.
The number of on-board units sold amounted to 9.3 million units (previous year: 11.2 million units). The lower volumes were associated with the delayed commissioning of the project in Gauteng, South Africa, and the initial deliveries for the nationwide electronic toll collection system in Poland that took place in the previous year. The increased units sold in North America had a positive effect.
The EBIT of the segment SEC was at EUR 66.1 million (previous year: EUR 37.3 million), the EBIT margin was therefore at 19.3% (previous year: 12.1%). The main factors for the increase in a year-on-year comparison were the stable EBIT contributions from the technical and commercial operation of the nationwide truck toll collection system in the Czech Republic, the technical operation, including maintenance, of the nationwide truck toll collection system in Austria and the first full year of earnings from the technical and commercial operation project in Poland. The competitive pricing within the framework of the contract extension with the E-ZPass Group, which has now led to globally typical margins in the U.S.A. as well, plus the lower contribution for the upkeep of the operational readiness and the absence of the profit contribution connected with the lack of on-board unit deliveries for the system operation in Gauteng, South Africa, burdened the EBIT of the segment.
In the segment Others (OTH), revenues rose by 52.4 % to EUR 18.3 million (previous year: EUR 12.0 million). This increase resulted largely from the production and deliveries for the GSM-R project of Kapsch CarrierCom. The segment OTH contributed 3.7% to total revenues in fiscal year 2012/13 (previous year: 2.2%).
The EBIT of the segment OTH was at EUR 0.9 million (previous year: EUR 0.8 million), the EBIT margin was therefore at 5.1% (previous year: 6.5%).
| Revenues by segment | 2012/13 | 2011/12 | +/-% | 2010/11 | ||||
|---|---|---|---|---|---|---|---|---|
| Road Solutions Projects (RSP) | ||||||||
| Revenues (share of total revenues) | in million EUR | 128.3 (26%) | 229.9 (42%) | -44% | 158.9 (41%) | |||
| EBIT | in million EUR | -51.7 (-40%) | 4.1 | (2%) | <-300% | 0.1 | (0%) | |
| Services, System Extensions, Components Sales (SEC) | ||||||||
| Revenues (share of total revenues) | in million EUR | 342.3 (70%) | 308.1 (56%) | 11% | 223.3 (57%) | |||
| EBIT | in million EUR | 66.1 (19%) | 37.3 (12%) | 77% | 48.3 (22%) | |||
| Others (OTH) | ||||||||
| Revenues (share of total revenues) | in million EUR | 18.3 | (4%) | 12.0 | (2%) | 52% | 6.4 | (2%) |
| EBIT | in million EUR | 0.9 | (5%) | 0.8 | (7%) | 21% | 0.4 | (7%) |
Europe accounted again for the largest share of total revenues (59.1 %) in fiscal year 2012/13. The revenue decrease of EUR 52.5 million (-15.4%) can be attributed largely to the completion of the implementation of the nationwide electronic truck toll collection system in Poland during the previous year. The ongoing implementation project in Belarus could not offset this. Revenues in the rest of the world region decreased by EUR 24.9 million (-22.2%). The major factor here was the absence of deliveries of on-board units for the project in South Africa compared to the previous year. In the American region, revenues increased by EUR 11.2 million (17.6%), mainly due to the project award for the implementation of a "managed lane" system in Texas. Revenues in Austria rose by EUR 5.3 million (16.1%) mainly attributable to the increase in the segment OTH.
| Revenues by region | 2012/13 | 2011/12 | +/-% | 2010/11 | ||||
|---|---|---|---|---|---|---|---|---|
| Austria (share of total revenues) | in million EUR | 38.0 | (8%) | 32.8 | (6%) | 16% | 37.5 | (10%) |
| Europe (excl. Austria) (share of total revenues) | in million EUR | 288.9 (59%) | 341.4 (62%) | -15% | 182.0 (47%) | |||
| Americas (share of total revenues) | in million EUR | 74.8 (15%) | 63.6 (12%) | 18% | 27.6 | (7%) | ||
| Rest of the world (share of total revenues) | in million EUR | 87.2 (18%) | 112.1 (20%) | -22% | 141.5 (36%) |
The cost of materials and other production services declined by EUR 29.7 million to EUR 257.6 million (previous year: EUR 287.3 million). Compared to the previous year, the share of costs for materials and other production services in relation to revenues increased slightly from 52.2% to 52.7%.
The staff costs increased by EUR 9.8 million to EUR 131.6 million (previous year: EUR 121.7 million). Compared to the previous year, the average number of employees grew by 211 persons from 2,585 to 2,796. The staff cost ratio (staff costs in relation to total revenues) rose from 22.1% to 26.9%. This is due on the one hand to the staff requirements connected with the technical and commercial operation projects in Poland, the setup of the subsidiary in Belarus, the implementation of the project in Texas and the standby requirements in the South African project in Gauteng. On the other hand, it also results from the consistent implementation of the growth strategy that was decided last fiscal year and which required anticipative personnel developments.
Amortization of intangible assets and depreciation of property, plant and equipment decreased by EUR 0.7 million to EUR 17.7 million (previous year: EUR 18.4 million), resulting primarily from the decreased scheduled amortization of intangible assets from company acquisitions.
Other operating expenses increased by EUR 4.8 million to EUR 87.8 million (previous year: EUR 83.0 million). This increase occurred primarily in exchange rate losses that were largely realized in rental expenses and IT expenses. In contrast, legal and consulting fees as well as marketing and advertising expenses decreased.
The financial result improved by EUR 7.2 million to EUR 1.3 million (previous year: EUR -5.9 million). The increase in finance income can be attributed primarily to the sale of the minority shares in the joint venture LLC "United Toll Systems", Russia, as well as the sale of securities. The exchange rate gains, the majority of which were not yet realized, lay below those of the previous year. The finance costs stayed nearly on the same level as previous year. Within the exchange rate losses, the realized losses were reduced whereas the unrealized ones increased slightly.
The result from joint ventures and associates was EUR 0.3 million (previous year: EUR 0.0 million) and resulted mainly from the investment in SIMEX, Mexico.
The profit before income taxes decreased by EUR 19.4 million to EUR 16.9 million (previous year: EUR 36.3 million). Lower income taxes and higher finance income were able to partly compensate for the lower operating result (EBIT).
The profit for the period decreased by EUR 10.7 million to EUR 16.7 million (previous year: EUR 27.5 million), the earnings per share were at EUR 0.74 (previous year: EUR 1.62).
The balance sheet total increased by EUR 9.5 million to EUR 567.2 million as of 31 March 2013 (31 March 2012: EUR 557.7 million).
The total equity decreased by EUR 15.6 million to EUR 240.7 million (31 March 2012: EUR 256.2 million). The equity ratio of Kapsch TrafficCom Group decreased slightly from 45.9% on 31 March 2012 to 42.4% on 31 March 2013.
In total assets, the most significant changes involved the current assets which rose from EUR 389.6 million in the previous year to EUR 403.1 million at the balance sheet date. Thanks to the increase of cash and cash equivalents as well as inventories, it was possible to compensate for the decrease of trade receivables and other current assets.
Non-current assets decreased by EUR 4.0 million to EUR 164.1 million (31 March 2012: EUR 168.1 million). Other financial assets and investments went down from EUR 51.2 million to EUR 38.1 million mainly due to the development of the shares in the Norwegian Q-Free ASA.
On the liabilities side, the non-current liabilities rose by EUR 24.1 million to EUR 137.9 million (31 March 2012: EUR 113.8 million) due to the financing of the implementation of the nationwide electronic truck toll collection system in Belarus.
The current liabilities increased by EUR 1.1 million to EUR 188.7 million (31 March 2012: EUR 187.6 million). The major change within this position occurred in the current financial liabilities that decreased from EUR 53.2 million to EUR 19.7 million mainly due to the return of the credit for the Polish project. However, this was more than compensated for by the rise in trade payables, current provisions and current tax payables.
In total, these balance sheet changes led to a clear improvement in the following figures:
Net cash flow from operating activities was at EUR 67.2 million (previous year: EUR -37.8 million). This was mainly attributable to the decrease in trade receivables and other current assets, the increase in trade payables and other current payables and the increase in current provisions, whereas the lower operating result (EBIT) and the increase in inventories weighed down the net cash flow from operating activities.
The net cash flow from investing activities in fiscal year 2012/13 was at EUR -10.0 million (previous year: EUR -16.7 million) and was largely determined by the expansion of production facilities, ongoing replacement investments and the acquisition of a share in SIMEX, Mexico. This was compensated partly by the sale of the minority shares in the joint venture LLC "United Toll Systems", Russia, as well as the sale of securities and proceeds from the disposal of property, plant and equipment and intangible assets.
The net cash flow from financing activities was -22.5 million (previous year: EUR 57.6 million), and it was negative due to the drawdown of current financial liabilities mainly from project financing as well as the payment of dividends totaling EUR 19.1 million. This could not be set off by the increase in non-current financial liabilities. The net cash flow from financing activities had a positive effect on the net debt.
Cash and cash equivalents increased to EUR 79.0 million as of 31 March 2013 (31 March 2012: EUR 44.9 million).
Reliability and accuracy of installed systems. The toll transaction rate is a figure for assessing the accuracy and reliability of a toll collection system. It indicates the number of successful transactions in relation to all potential toll transactions of vehicles equipped with a functioning on-board unit. A high toll transaction rate translates to high toll income.
The average toll transaction rate of the existing truck toll collection system in Austria was at approximately 99.8% in 2012, again reaching the high level of 2011. During the same period, the average transaction rate of the nationwide electronic toll collection system in the Czech Republic was approximately 99.6%, up by 0.1% from 99.5% in the previous year. The calculation of the average transaction rate is based on methods agreed upon with the respective customer, meaning that comparisons between the average transaction rates achieved in different projects are only possible on a limited basis.
Staff. The average number of employees in the Kapsch TrafficCom Group in fiscal year 2012/13 was 2,796, which is 8.2% higher than the average of 2,585 in fiscal year 2011/12. As of 31 March 2013, the group had a workforce of 3,013 (2,821 salaried and 192 non-salaried employees), of which more than half were located outside of Europe (roughly 1,200 employees in South Africa).
Training and education. Kapsch TrafficCom places great importance on the continued training and education of its employees. This involves not only promoting professional education but also providing seminars and workshops for developing personal and teamwork skills. In addition, training sessions tailored to the particular needs of employees are offered within the framework of the Kapsch Academy. A job rotation program promotes the international exchange of staff between the various locations, and select employees are prepared for their future tasks in a management trainee program.
Pension fund. Kapsch TrafficCom makes contributions to an external pension fund for employees of group companies in Austria under a defined contribution scheme. The amounts of the payments are based on the individual employee's income and the operating profit margin of the company.
Profit participation. Kapsch TrafficCom is aware of the employees' contribution to its success and acknowledges this through a profit participation plan. The Kapsch TrafficCom Group rewards the commitment of its employees by distributing to them up to 5% of the group profit before income taxes. Country-specific upper limits have been established to ensure that the distribution reflects local purchasing power. Every employee receives a share, which is independent of the person's salary or wage and limited to EUR 1,500 per employee.
Advancement of women. Kapsch TrafficCom is committed to promoting the advancement of women in the workplace. Women are supported through a flexible working hours scheme that is designed to help combine professional and private life. In addition, Kapsch TrafficCom cooperates with schools, universities and colleges in order to increase the proportion of women employed, among other goals. The company also promotes women in the workforce through participation in specific programs such as "FIT Frauen in die Technik" or "FemTech". A committee for non-discrimination has been established within the Kapsch TrafficCom Group.
Quality. Kapsch TrafficCom AG defines its processes in an integrated management system for health and safety, security, environment and quality (HSSEQ). Valid certifications are held for quality management pursuant to ISO 9001 (since 2002), for occupational health and safety pursuant to OHSAS 18001 and for environmental management pursuant to ISO 14001 (since 2005). Kapsch TrafficCom has implemented the necessary measures in its internal processes and monitors them continuously. The certificate pursuant to ISO 27001 ensures the necessary information security management. The certificate pursuant to ISO 20000 for service management in connection with technical operations guarantees a high service quality in this area.
Environment. In the future, the group will strive to fulfill its responsibilities toward environmental protection even more extensively, particularly through the efficient and responsible use of natural resources.
Kapsch TrafficCom understands the challenge of long-term and responsible business activities and is dedicated to sustainability on an economic, environmental and social level. Regularly published sustainability reports will demonstrate the progress on a group level and the continuing establishment of predefined objectives.
Living up to its socio-political responsibility, the entire Kapsch Group – organized by Kapsch AG – further supports a number of contemporary art and cultural institutions and projects and even initiates its own projects in this field. Extensive social measures as well as select educational initiatives complement this approach, which the company considers to be an obligation both inside and outside the group.
Music. A major component of this commitment consists of sponsoring activities related to the Vienna Concert Hall (Wiener Konzerthaus), a cultural institution with an excellent reputation even far beyond Austria's borders. The Kapsch Group has been the main sponsor of the Vienna Concert Hall since 1992. The "Wien Modern" festival – one of the world's best known festivals of contemporary music – has been supported by Kapsch since its launch in 1989.
Visual arts. Promoting lesser-known artists is of particular concern to the Kapsch Group. In particular, young Austrian and international artists are assisted by sponsorship campaigns. One example is the photo calendar that the Kapsch Group has supported since 1994. The calendar is presented annually in late autumn at a private exhibition.
Educational institutions. As a company that is driven by technology and innovation, Kapsch TrafficCom is constantly interested in establishing contacts as early as possible with the best engineering talent. Since 2005, the Kapsch Group has supported the work of INiTS Universitäres Gründerservice Wien GmbH, which aims to support and guide young entrepreneurs in the implementation of ideas relating to well defined business concepts.
Social activities. Kapsch TrafficCom takes pride in supporting select social projects at home and abroad. One example of the numerous projects is ICEP, the Institute for Cooperation in Development Projects, whose activities help improve the circumstances of people in developing countries. By directly promoting migration and integration, Kapsch TrafficCom contributes to social justice, the positive development of society and long-term safety and security.
Risk management has been positioned as a separate function within the finance department of Kapsch TrafficCom AG, focusing on project risk management and enterprise risk management (ERM).
Project risk management analyzes beginning in the bid phase of customer projects in institutionalized processes all relevant opportunities and risks pertaining to the group's projects, thereby providing the basis for the timely planning and implementation of risk-mitigating activities.
The enterprise risk management (ERM) analyzes not only the risks of key customer projects but also strategic, technological, organizational, financial, legal and IT risks, and reports them to the executive board and the audit committee of the supervisory board on a semi-annual basis. The goal of the ERM approach is early identification, analysis and control of all risks which might influence strategic and operational objectives of the company. The primary objective in this context is not to avoid risks but to deal with risks in a controlled and deliberate manner and to recognize and realize opportunities as they arise over time in order to make a valuable contribution to the management of the company.
The material risks faced by the Kapsch TrafficCom Group and the respective risk management measures are briefly explained below.
Volatility of new orders. A major portion of the revenues of the Kapsch TrafficCom Group is generated in the segment Road Solution Projects (RSP). In this segment, the group regularly participates in tenders for the implementation and operation of large electronic toll collection systems as well as for the collection of tolls on specific road sections. On the one hand, there is a risk that tenders in which the group participates or plans to participate could be delayed or withdrawn, for instance as a result of political changes, appeals or legal actions by unsuccessful bidders. On the other hand, a risk exists that Kapsch TrafficCom may not win its bids for new projects due to technological, financial, formal or other reasons. Recurring revenues from the technical and commercial operation of systems also depend on the successful participation in tenders for systems.
In the past, the revenues of the Kapsch TrafficCom Group have been heavily influenced by the realization of implementation projects in the given fiscal year. In particular, significantly higher revenues were recorded in 2003 (implementation of a nationwide electronic truck toll collection system in Austria), 2006/07 (implementation of a nationwide electronic truck toll collection system in the Czech Republic) and 2010/11 (implementation of an electronic toll collection system in the South African province of Gauteng). In fiscal year 2011/12, sizeable revenues were generated from the implementation of a nationwide electronic truck toll collection system in Poland and in fiscal year 2012/13 from the implementation of a nationwide electronic truck toll collection system in Belarus.
The strategy of the Kapsch TrafficCom Group is aimed, among other things, at reducing this volatility of revenues through increased geographic diversification and increased diversification of the customer base and product portfolio as well as sustained growth in the share of technical and commercial system operation in total revenues in the interest of strengthening the segment Services, System Extensions, Components Sales (SEC).
Risks of project execution. In connection with the installation of systems, Kapsch TrafficCom Group is usually contractually obligated to provide performance guarantees. Since electronic toll collection systems and other intelligent transportation systems are frequently sophisticated and technologically complex systems that must be implemented within a short timeframe, system and product defects or missed deadlines may occur due to the limited time available. Unexpected project modifications, lack of qualified personnel, quality defects, unexpected technical problems as well as performance problems
of suppliers or consortium members may also have a negative impact on project schedules. The failure to meet guaranteed performance levels or deadlines in some cases results in penalties and/or compensation for damages, sometimes also compensation for lost toll revenues. Significant deadline overruns also frequently trigger contractual clauses that enable clients to terminate contracts prematurely. A significant delay in a project, failure to achieve guaranteed performance levels or failure to implement a project in time would also reduce the chances of success in future tenders for systems. There is also the risk that Kapsch TrafficCom Group cannot execute projects in line within the set cost budgets.
Kapsch TrafficCom Group employs risk management methods and project risk management procedures based on IPMA (International Project Management Association) standards in order to guard against risks associated with projects.
Long-term contracts with public authorities. In many cases, the system contracts are awarded by public agencies. Framework agreements and service contracts in connection with toll collection projects may include terms and conditions that are not negotiable in a tender process and that may be disadvantageous to the Kapsch TrafficCom Group. Some long-term contracts include challenging requirements with regard to the performance of the implemented systems, components and processes. These requirements can, if they are not achieved, result in significant penalties, damages or even contract termination. On the other hand, some contracts include substantial bonus payments for over-fulfillment of performance requirements. In the case of longterm contracts, the margins earned can also differ from the original estimates due to changes in costs.
Liabilities arising from contracts concluded by the Kapsch TrafficCom Group may include liabilities regarding customers' loss of profit, product liabilities and other liabilities. While the group aims to include appropriate limitations to its liability in contracts, it is still impossible to guarantee that all contracts contain sufficient limitations to the group's liability or that these limitations can be enforced under applicable law.
Capacity for innovation. The strong market position of the Kapsch TrafficCom Group is, to a large extent, based on its ability to develop state-of-the-art, efficient and reliable systems, components and products. Kapsch TrafficCom is committed to a permanent and integrated innovation process. In order to maintain its already strong position in technology, the Kapsch TrafficCom Group invests a considerable portion of its revenues in research and development activities. However, if the group does not succeed in developing new systems, components and products, this can be detrimental to its competitive position.
Since its capacity for innovation is based largely on technology, internal know-how and intellectual property, the global increase in product piracy and reverse engineering may have negative effects on the group. In addition, any failures in protecting these technologies may have a negative impact on the group's competitive position. Moreover, it is possible that systems, components, products or services could infringe on the intellectual property rights of third parties. The Kapsch TrafficCom Group places great importance on the protection of technologies and the company's internal know-how, e.g. through patents and non-disclosure agreements with other parties.
Acquisition and integration of companies as a part of the group's growth. One of the strategic objectives of the Kapsch TrafficCom Group is to grow internationally both by organic means and through select acquisitions and joint ventures. In the implementation of this strategy, the group has acquired and integrated companies around the world. However, a number of challenges remain in connection with this growth strategy in order to realize the desired synergies and objectives.
Country risk. The strong expansion of business activities in Eastern Europe and non-European countries has exposed the Kapsch TrafficCom Group to heightened political risks. Significant and unforeseeable political changes can exert a major influence on the ability to implement or operate ITS projects in these countries and can also affect the availability and accessibility of funds. There may also be interference with the property rights of the Kapsch TrafficCom Group or complications regarding business practices and activities.
Foreign exchange risk. The Kapsch TrafficCom Group maintains branches, offices and subsidiaries in a number of countries outside the eurozone. A considerable portion of revenues and costs are denominated in the currencies of the respective foreign companies rather than in euros. Although the group aims to hedge the net currency position of the individual contracts as necessary, currency fluctuations may result in exchange rate losses that may influence the consolidated financial statements (transaction risk). In addition, risks arise from the conversion of the separate financial statements of international companies into the group currency, the euro (translation risk). Fluctuations in exchange rates may also result in a change in the competitive position of the Kapsch TrafficCom Group.
Interest rate risk. Within the framework of project financing, the group regularly agrees to variable interest rates that are tied to market interest rates (Euribor, Pribor etc.). This exposes the Kapsch TrafficCom Group to interest rate risks. The group utilizes appropriate financial instruments to hedge against interest rate risks when these risks are significant.
Liquidity risk. Sufficient financial resources must be available to ensure that the Kapsch TrafficCom Group can meet its payment liabilities at any time. Medium and long-term financing must be available in order to carry out large-scale projects (such as implementing a nationwide toll collection system under delayed payment terms from the client) and for acquiring other companies. Additionally, implementing large-scale projects often requires the provision of significant bank guarantees to secure bid obligations (bid bonds) or to secure possible warranty claims (performance bonds).
In financing agreements, the Kapsch TrafficCom Group is subject to the customary restrictions in terms of its business policy, e.g. when drawing additional loans, using assets as collateral or providing guarantees for third parties. The availability of financing and bank guarantees depends on market conditions as well as the net assets and financial position of the Kapsch TrafficCom Group and the results of operations. A lack of liquid assets (even if the group is otherwise solvent), of financing or of bank guarantees can have an extremely adverse impact on the net assets and financial position of the Kapsch TrafficCom Group and the results of operations.
Liquidity risk is managed by ongoing, company-wide financial and cash planning. Potential liquidity shortages can thus be identified and mitigated.
Credit risk. The Kapsch TrafficCom Group is exposed to the risk of non-payment by customers. The credit ratings of new and existing customers are checked on a regular basis. Many of the key customers of the Kapsch TrafficCom Group are public authorities, especially in connection with implementing and/or operating nationwide or regional toll collection systems. There is also a risk that the counterparties (including financial institutions assumed to have good credit ratings) of both original and derivative financial instruments cannot meet their payment obligations when due. A payment default or the recognition of impairment charges to receivables can be extremely detrimental to the net assets and financial position of the Kapsch TrafficCom Group and the results of operations.
The success of the Kapsch TrafficCom Group depends heavily on key personnel with many years of experience in the industry. Moreover, the group's ability to recruit qualified staff, integrate them into the company and retain them over the long-term is crucial. The loss of key personnel and difficulties in the recruitment of personnel may adversely affect the success of the group. Kapsch TrafficCom Group has implemented a number of measures to counteract personnel risks, such as incentive schemes and employee development opportunities.
A variety of regulations and legal requirements must be observed in connection with participating in public tenders, implementing infrastructure for ITS solutions (such as toll stations) and the operation of toll collection systems. Identifying and adhering to applicable legal regulations and requirements can result in considerable administrative and technical expense. The failure to meet regulations or official requirements can lead to severe penalties and can also reduce the possibility of (successfully) taking part in tenders or continuing with the given business activity.
With the expansion into new regions and new ITS business areas, the risk of patent infringement or the violation of property rights increases. Kapsch TrafficCom has implemented active intellectual property (IP) management as a separate function. In order to avoid legal actions and court proceedings, the Kapsch TrafficCom Group monitors potential intellectual property rights infringements continuously as well as prior to entry into new markets or regions.
As a technology group, the Kapsch TrafficCom Group is exposed to typical IT risks relating to security, confidentiality and the availability of data. For this reason, Kapsch TrafficCom AG has implemented an IT risk management system designed according to the corporate risk and IT security application method (CRISAM) and has been certified pursuant to ISO 27001 (information security management). The Kapsch TrafficCom Group is also certified according to ISO 20000 "IT service management" (similar to ITIL) for the operation of toll collection systems.
The ERM approach of Kapsch TrafficCom AG is not only concerned with risks; it also includes the periodic identification, assessment and management of opportunities. Significant opportunities for the Kapsch TrafficCom Group result from increased financing needs for infrastructure projects, relief for public budgets, global traffic growth, legislation to reduce the environmental impact of transportation, enhanced vehicle and fleet operations productivity and the increasing comfort and convenience expectations of travelers. In addition, many market opportunities arise from the geographic diversification as well as the increasing diversification of the customer base and product portfolio.
From the current perspective, no risks have been identified that could endanger the continued operations of the Kapsch TrafficCom Group. Increasing geographic expansion, the diversification of the product and solution portfolio (strengthening of the ITS business) and an increased share of recurring revenues (further growth in the segment Services, System Extensions, Components Sales) are planned to further reduce the concentration of risks in the future.
Kapsch TrafficCom AG began analyzing and documenting its existing internal processes for financial reporting on an ongoing basis in fiscal year 2009/10. The results obtained so far have been presented at the quarterly meetings of the audit committee for assessment and discussion. The internal audit department ensures by audits of the subsidiaries of Kapsch TrafficCom AG that a reliable and functioning control system is implemented.
The Group IFRS Accounting Manual represents the cornerstone for financial accounting and reporting throughout the whole Kapsch Group. The manual is published and regularly updated by the Kapsch Group and contains the essential financial and reporting procedures based on the International Financial Reporting Standards (IFRS). Groupwide guidelines, work instructions and process descriptions represent another important pillar of the internal control system.
The central elements of the ICS process include regular verification of compliance with the principle of dual control and the segregation of duties as well as defined actions for monitoring the effectiveness and efficiency of operating activities, the reliability of financial reporting and the compliance with relevant legal regulations. The ICS guidelines of Kapsch TrafficCom AG follow the basic structure of the internationally recognized standards for internal control systems (COSO – Internal Control Framework of the Committee of Sponsoring Organizations of the Treadway Commission).
The accounting for all group transactions is handled by a variety of software solutions. In a number of countries, the accounting has been outsourced to locally-based tax accountants due to the size of the subsidiaries. Companies submit reporting packages to the head office on a quarterly basis which contain all accounting data pertaining to the statement of comprehensive income, balance sheet and cash flow statement. The data is then transferred into the central consolidation system (Hyperion Financial Management). This financial information is verified on a groupwide basis by the central Kapsch TrafficCom controlling department and subsequently forms the basis for the quarterly reports issued by the Kapsch TrafficCom Group in accordance with IFRS.
The supervisory board is kept informed of business developments by the executive board during regular meetings by way of consolidated presentations consisting of segment reporting, earnings development analyses with comparisons of current figures to figures from the budget and the previous period, forecasts, group financial statements and developments in the number of employees and order inflow as well as select financial figures.
In keeping with the decentralized structure of the Kapsch TrafficCom Group, local management is responsible for the implementation and monitoring of the internal control system. The managing directors of the individual subsidiaries are responsible for establishing and designing internal control and risk management processes that meet the needs of the given company in view of accounting procedures, as well as for ensuring compliance with the groupwide rules and guidelines in this respect. In order to assist the local management of the subsidiaries, the function of an ICS manager was established within the finance department of Kapsch TrafficCom AG. The duty of this function is to standardize and continously improve the ICS within the Kapsch TafficCom Group, to monitor the compliance and effectiveness of the controls and the improvement of found weaknesses and to report periodically to the audit committee of the supervisory board.
The Kapsch TrafficCom Group has an international network of research and development centers in Vienna and Klagenfurt (Austria), Jönköping (Sweden), Bologna (Italy), Buenos Aires (Argentina), Toronto (Canada), Kingston (U.S.A.) and Capetown (South Africa). As of 31 March 2013, the Kapsch TrafficCom Group employed more than 500 (previous year: more than 400) engineers in its research and development activities.
Research and development (R&D) have high priority for the Kapsch TrafficCom Group in pursuing its strategic goals. The knowledge of entirely new technologies based on national and international standards and the ability to implement these form the foundation for successful business developments and also enable the entry into new markets. The current focus lies on the regions of North and South America, Russia, Australia and South-East Asia.
In the last fiscal year, the main focus of R&D was on the optimization and use of a new high-performance roadside infrastructure platform that integrates all major sensor systems into a single, common software platform. The aim was to use this platform in all international customer projects, to generate a high reusability of its basic components and ensure a low maintenance effort. This platform was already delivered to Portugal, the United States, Belarus and South Africa. Another focus was on the continuous reusability and quality of centralized components, which were used for the first time in this form in Belarus.
Major R&D activities included the prototyping of future ITS solutions. Worth mentioning is the participation in standardization activities for the European ITS-G5 and the U.S. WAVE technology regarding V2X communication (vehicle-to-vehicle, vehicleto-infrastructure). Furthermore, pilot and demonstration projects were successfully carried out in the telematics test field and at the ITS world congress 2012 in Vienna in addition to the first 5.9 GHz commercial vehicle system pilot in den U.S.A. and a 5.9 GHz parking and electronic toll collection pilot in Singapore.
The new developed ITS vehicle platform enables vehicle-to-vehicle and vehicle-to-infrastructure-communication that delivers static and dynamic vehicle data such as size, weight, type of use, speed, direction and GPS coordinates. The research in the field of vehicle registration and vehicle classification led to the development of new video and sensor technologies with outstanding performance.
The main initiatives in the component business involved developing less expensive, energy-saving and reduced-size generations of on-board units based on DSRC, GNSS and 5.9 GHz technology.
Important organizational initiatives to reduce the costs and delivery times included further process changes, product and quality improvements on the subsystems in all R&D fields as well as the implementation of integrated development environments to cover the entire product life cycle (application life cycle management).
Successful R&D efforts are the foundation for sustained improvements in existing products and solutions as well as the continuous reduction of production, installation, operating and maintenance costs, all of which are essential for maintaining a technological and competitive advantage.
Research costs are recognized as expenses. The same applies to development costs, unless the IFRS criteria for classification as intangible assets are met. Since the statement of comprehensive income is structured by expense type, the research and development costs are reported under various income statement items, in particular under the cost of materials and other production services, staff costs and other operating expenses.
In fiscal year 2012/13, the Kapsch TrafficCom Group invested approximately EUR 59.2 million in research and development (previous year: EUR 53.3 million), representing approximately 12% (previous year: approximately 10%) of total revenues.
The 2013/14 fiscal year will be marked by a continuation of existing projects. In particular, the further developments in South Africa will influence the revenue and earnings situation. In addition, an invitation to tender has already begun in Slovenia. Additional tenders are expected in Belgium and the U.S.A. Extensive toll collection systems are under discussion in Bulgaria, Russia and the surrounding countries as well as in Germany. Naturally, Kapsch TrafficCom is following these discussions with great interest.
No major events occurred after the balance sheet date.
Vienna, 27 May 2013
Georg Kapsch Erwin Toplak André Laux
Chief Executive Officer Chief Operating Officer Executive Board member
We declare to the best of our knowledge that the consolidated financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the group as required by the applicable accounting standards and that the group management report gives a true and fair view of the development and performance of the business and the position of the group, together with a description of the principal risks and uncertainties faced by the group.
Vienna, 27 May 2013
Georg Kapsch Erwin Toplak André Laux Chief Executive Officer Chief Operating Officer Executive Board member
| Board Member | Area of responsibility |
|---|---|
| Georg Kapsch (CEO) | Finance and Administration, Mergers & Acquisitions, Investor Relations, Legal, International Subsidiaries, Human Resources, Marketing & Communications, International Relations & Affairs, Innovation Management, Production, Operations and Sales Region North America |
| Erwin Toplak (COO) | Sales Region 1, Business Development Electronic Toll Collection, Plattform Management and Research & Development |
| André F. Laux (Executive Board Member) | Sales Region 2, Business Development Intelligent Transportation Systems, Product and Project Management |
Consolidated statement of comprehensive income.
| All amounts in EUR | Note | 2012/13 | 2011/12 |
|---|---|---|---|
| Revenue | (1) | 488,937,192 | 549,921,391 |
| Other operating income | (2) | 15,944,925 | 10,250,121 |
| Changes in finished and unfinished goods and work in progress | (3) | 4,715,407 | -7,715,924 |
| Other own work capitalized | 280,792 | 196,825 | |
| Cost of materials and other production services | (4) | -257,567,332 | -287,288,207 |
| Staff costs | (5) | -131,554,950 | -121,725,367 |
| Amortization of intangible assets and depreciation of property, plant and equipment |
(6) | -17,671,090 | -18,399,507 |
| Other operating expenses | (7) | -87,823,624 | -83,019,586 |
| Operating result | 15,261,319 | 42,219,746 | |
| Finance income | (8) | 14,115,415 | 7,209,800 |
| Finance costs | (8) | -12,819,906 | -13,083,030 |
| Financial result | (8) | 1,295,509 | -5,873,229 |
| Results from joint ventures and associates | (14) | 327,203 | -32,679 |
| Profit before income taxes | 16,884,031 | 36,313,838 | |
| Income taxes | (9) | -177,189 | -8,861,709 |
| Profit for the period | 16,706,842 | 27,452,129 | |
| Other comprehensive income for the period | |||
| Gains/losses recognized directly in equity: | |||
| Available-for-sale financial assets | -10,693,827 | 11,596,162 | |
| Currency translation differences | -2,900,791 | -1,541,864 | |
| Income tax relating to components of other comprehensive income | 429,994 | -78,020 | |
| Other comprehensive income for the period net of tax | (10) | -13,164,624 | 9,976,278 |
| Total comprehensive income for the period | 3,542,218 | 37,428,406 | |
| Profit attributable to: | |||
| Equity holders of the company | 9,682,668 | 20,599,568 | |
| Minority interests | 7,024,174 | 6,852,560 | |
| Total comprehensive income attributable to: | 16,706,842 | 27,452,129 | |
| Equity holders of the company | |||
| Minority interests | -2,339,922 | 30,941,852 | |
| 5,882,139 | 6,486,554 | ||
| Earnings per share from the profit for the period attributable | 3,542,218 | 37,428,406 | |
| to the equity holders of the company (in EUR) | (29) | 0.74 | 1.62 |
| All amounts in EUR | Note | 31 March 2013 | 31 March 2012 |
|---|---|---|---|
| ASSETS | |||
| Non-current assets | |||
| Property, plant and equipment | (12) | 24,675,617 | 21,847,139 |
| Intangible assets | (13) | 79,170,076 | 80,378,811 |
| Interests in joint ventures and associates | (14) | 1,694,269 | 0 |
| Other non-current financial assets and investments | (15) | 38,085,392 | 51,229,052 |
| Other non-current assets | (16) | 941,573 | 3,420,384 |
| Deferred tax assets | (22) | 19,527,167 | 11,188,685 |
| 164,094,095 | 168,064,072 | ||
| Current assets | |||
| Inventories | (17) | 66,428,176 | 48,898,875 |
| Trade receivables and other current assets | (18) | 253,176,701 | 287,589,919 |
| Other current financial assets | (15) | 4,505,087 | 8,212,783 |
| Cash and cash equivalents | (19) | 79,022,460 | 44,929,361 |
| 403,132,425 | 389,630,938 | ||
| Total assets | 567,226,520 | 557,695,010 | |
| EQUITY | |||
| Capital and reserves attributable to equity holders of the company | |||
| Share capital | (20) | 13,000,000 | 13,000,000 |
| Capital reserve | 117,508,771 | 117,508,771 | |
| Retained earnings and other reserves | 98,058,311 | 112,098,233 | |
| 228,567,083 | 242,607,004 | ||
| Minority interests | 12,114,574 | 13,639,537 | |
| Total equity | 240,681,656 | 256,246,542 | |
| LIABILITIES | |||
| Non-current liabilities | |||
| Non-current financial liabilities | (21) | 104,371,856 | 74,255,766 |
| Liabilities from post-employment benefits to employees | (23) | 17,288,534 | 16,703,633 |
| Non-current provisions | (26) | 1,370,050 | 1,097,655 |
| Other non-current liabilities | (24) | 1,765,834 | 3,439,531 |
| Deferred income tax liabilities | (22) | 13,086,048 | 18,315,570 |
| 137,882,323 | 113,812,155 | ||
| Current liabilities | |||
| Trade payables | 80,220,031 | 59,013,463 | |
| Other liabilities and deferred income | (25) | 52,520,345 | 53,047,511 |
| Current tax payables | 8,030,529 | 3,795,130 | |
| Current financial liabilities | (21) | 19,658,281 | 53,249,432 |
| Current provisions | (26) | 28,233,354 | 18,530,776 |
| 188,662,540 | 187,636,313 | ||
| Total liabilities | 326,544,863 | 301,448,468 | |
| Total equity and liabilities | 567,226,520 | 557,695,010 |
| All amounts in EUR | ||||||
|---|---|---|---|---|---|---|
| Attributable to equity holders of the company | Minority interests | Total equity | ||||
| Share capital | Capital reserve | Other reserves | Consolidated retained earnings |
|||
| Carrying amount as of 31 March 2011 | 12,200,000 | 70,077,111 | 4,249,003 | 89,816,711 | 15,170,566 | 191,513,391 |
| Proceeds from shares issued | 800,000 | 47,431,660 | 48,231,660 | |||
| Dividend for 2010/11 | -13,000,000 | -8,017,583 | -21,017,583 | |||
| Contributions from shareholders | 90,667 | 90,667 | ||||
| Result for the period | 20,599,568 | 6,852,560 | 27,452,129 | |||
| Other comprehensive income for the period: |
||||||
| Currency translation differences | -1,175,858 | -366,006 | -1,541,864 | |||
| Fair value gains/losses on available-for-sale financial assets |
||||||
| 11,518,142 | 0 | 11,518,142 | ||||
| Carrying amount as of 31 March 2012 | 13,000,000 | 117,508,771 | 14,681,954 | 97,416,280 | 13,639,537 | 256,246,542 |
| Dividend for 2011/12 | -11,700,000 | -7,407,103 | -19,107,103 | |||
| Result for the period | 9,682,668 | 7,024,174 | 16,706,842 | |||
| Other comprehensive income for the period: |
||||||
| Currency translation differences | -1,758,756 | -1,142,035 | -2,900,791 | |||
| Fair value gains/losses on available-for-sale financial assets |
||||||
| -10,263,833 | 0 | -10,263,833 | ||||
| Carrying amount as of 31 March 2013 | 13,000,000 | 117,508,771 | 2,659,364 | 95,398,947 | 12,114,574 | 240,681,656 |
Following the capital increase on 27 July 2011 – 800,000 shares were issued – the registered share capital of the parent company amounts to EUR 13,000,000. The total number of shares issued is 13,000,000. The shares are ordinary bearer shares and have no par value.
Capital reserve include those reserves that have not been established from result of prior periods. The addition in the fiscal year 2011/12 resulted from the issuance of 800,000 shares. The placement price was fixed at EUR 61.25 per share.
Other reserves contain contributions from shareholders, effects of changes in the investment interest held in subsidiaries as well as reserves from other comprehensive income, for example currency translation differences and fair value gains/losses on availablefor-sale financial assets after deduction of deferred taxes.
Retained earnings include the net profit for the fiscal year as well as past earnings of the entities included in consolidation, to the extent that these results have not been distributed as dividends.
Minority interests represent the third party shares in the equity of consolidated subsidiaries.
| All amounts in EUR | Note | 2012/13 | 2011/12 |
|---|---|---|---|
| Cash flow from operating activities | |||
| Operating result | 15.261.319 | 42.219.746 | |
| Adjustments for non-cash items and other reconciliations: | |||
| Depreciation and amortization | (6) | 17.671.090 | 18.399.507 |
| Impairment charge | 0 | 50.242 | |
| Increase/decrease in obligations for post-employment benefits | (23) | 584.901 | 389.028 |
| Increase/decrease in other non-current liabilities and provisions | (24, 26) | 407.522 | -2.973.804 |
| Increase/decrease in other non-current receivables and assets | 4.235.033 | -537.793 | |
| Increase/decrease in trade receivables (non-current) | (16) | 3.126.137 | 5.977.137 |
| Increase/decrease in trade payables (non-current) | (24) | -2.060.803 | -3.834.549 |
| Other (net) | -4.055.119 | -2.264.443 | |
| 35.170.080 | 57.425.071 | ||
| Changes in net current assets: | |||
| Increase/decrease in trade receivables and other assets | (18) | 34.773.487 | -92.190.370 |
| Increase/decrease in inventories | (17) | -17.529.301 | 585.736 |
| Increase/decrease in trade payables and other current payables | 20.634.294 | 1.944.819 | |
| Increase/decrease in current provisions | (26) | 9.702.578 | 13.808.826 |
| 47.581.057 | -75.850.989 | ||
| Cash flow from operations | 82.751.137 | -18.425.918 | |
| Interest received | (8) | 1.418.235 | 1.032.668 |
| Interest payments | (8) | -7.166.594 | -6.987.381 |
| Net payments of income taxes | -9.824.954 | -13.463.043 | |
| Net cash flow from operating activities | 67.177.824 | -37.843.673 | |
| Cash flow from investing activities | |||
| Purchase of property, plant and equipment | (12) | -12.686.263 | -10.648.960 |
| Purchase of non-current intangible assets | (13) | -7.547.597 | -2.412.085 |
| Purchase of securities and investments | (15) | -71.017 | -4.781.127 |
| Payments for the acquisition of shares in companies consolidated at equity | (14) | -1.702.325 | -32.679 |
| Proceeds from the disposal of property, plant and equipment and intangible assets | 1.357.267 | 1.181.546 | |
| Proceeds from the disposal of securities and other financial assets | 10.657.490 | 0 | |
| Net cash flow from investing activities | -9.992.444 | -16.693.304 | |
| Cash flow from financing activities | |||
| Proceeds from shares issued and contributions from shareholders | 0 | 48.322.327 | |
| Dividends paid to company shareholders | -11.700.000 | -13.000.000 | |
| Dividends paid to minority shareholders of group companies | -7.407.103 | -8.017.583 | |
| Increase in other non-current financial liabilities | (21) | 36.968.117 | 203.061 |
| Decrease in other non-current financial liabilities | (21) | -19.781 | 0 |
| Increase in current financial liabilities | (21) | 5.321.641 | 42.794.567 |
| Decrease in current financial liabilities | (21) | -45.636.936 | -12.684.280 |
| Net cash flow from financing activities | -22.474.063 | 57.618.092 | |
| Net decrease/increase in cash and cash equivalents | 34.711.317 | 3.081.114 | |
| Change in cash and cash equivalents | |||
| Cash and cash equivalents at beginning of year | (19) | 44.929.361 | 42.000.584 |
| Net decrease/increase in cash and cash equivalents | 34.711.317 | 3.081.114 | |
| Exchange gains/losses on cash and cash equivalents | -618.218 | -152.338 | |
| Cash and cash equivalents at end of year | (19) | 79.022.460 | 44.929.361 |
Kapsch TrafficCom Group is an international supplier of superior intelligent transportation systems (ITS).
The business activities of the Kapsch TrafficCom Group are subdivided into the following three segments:
The segment Road Solution Projects relates to the installation of ITS solutions.
The segment Services, System Extensions, Components Sales relates to the sale of services (maintenance and operation) and components in the area of ITS solutions.
The segment Others relates to non-core business activities conducted by Kapsch Components GmbH & Co KG. In this segment, Kapsch TrafficCom Group offers engineering solutions, electronic manufacturing and logistics services to affiliated entities and third parties.
The parent company (reporting entity) of this group is Kapsch TrafficCom AG, Vienna. Until June 2007 KAPSCH-Group Beteiligungs GmbH, Vienna, (immediate parent company of the reporting entity), a wholly-owned subsidiary of DATAX HandelsgmbH, had been the sole shareholder of Kapsch TrafficCom AG. DATAX HandelsgmbH, Vienna, is the controlling entity of the reporting entity and the ultimate parent of Kapsch Group.
Under an initial public offering in June 2007 KAPSCH-Group Beteiligungs GmbH reduced its share in Kapsch TrafficCom AG to 69.67%. As a result of a shift in share structure in the fiscal year ending 31 March 2009 as well as by issuing of further shares and sale of shares in the fiscal year ending 31 March 2012 it came to a further reduction to 61.90%. The shares of Kapsch TrafficCom AG in free float are listed in the Prime Market segment of the Vienna Stock Exchange since 26 June 2007.
The parent company, Kapsch TrafficCom AG, is a joint stock corporation incorporated and domiciled in Vienna, Austria. The address of its registered office is 1120 Vienna, Am Europlatz 2.
The following subsidiaries are part of the consolidated group:
n Kapsch TrafficCom S.r.l., Milan, Italy
n Transport Telematic Systems LLC, Abu Dhabi, United Arab Emirates
In the fiscal year 2012/13, SafeTCam (Pty) Ltd., Cape Town, South Africa, Traffic Software Solutions (Pty) Ltd., Cape Town, South Africa, Electronic Tolling Operations (Pty) Ltd., Cape Town, South Africa, Crestwave 61 (Pty) Ltd., Cape Town, South Africa and Crestwave 63 (Pty) Ltd., Cape Town, South Africa were liquidated.
The following entities are accounted for using the equity method:
n SIMEX, Integración de Sistemas, S.A.P.I. de C.V., Mexico
The accounting policies applied in the preparation of these consolidated financial statements are set out below:
Pursuant to Section 245a Austrian Commercial Code (UGB), the consolidated financial statements as of 31 March 2013 have been prepared in accordance with International Financial Reporting Standards (IFRS) as well as the Interpretations of the International Financial Reporting Interpretations Committee (IFRIC) as adopted by the European Union (EU). The consolidated financial statements as of 31 March 2013 are prepared under the historical cost convention, with the exception of availablefor-sale securities and derivative financial instruments, which are measured at fair value at the balance sheet date.
The preparation of the consolidated financial statements in conformity with IFRS requires the use of estimates and assumptions which influence the amount and presentation of assets and liabilities reported at the balance sheet date and income and expenses recorded during the reporting period. Although these estimates are made by the management board to the best of their knowledge and are based on current transactions, actual figures may differ from these estimates. The areas involving a higher degree of judgment or complexity as well as areas where assumptions and estimates are material to the consolidated financial statements are disclosed in Note 24.
For ease of presentation, amounts have been rounded and, unless indicated otherwise, are presented in thousand euros (TEUR). However, calculations are done using exact amounts, including the digits not shown, which may lead to rounding differences.
There are no new or amended standards and interpretations that are effective for the first time for the fiscal year 2012/13 that would be expected to have a material impact on the group.
IAS 19, 'Employee benefits', was amended in June 2011. The impact on the group will be as follows: to eliminate the corridor approach currently applied by the group and recognize all actuarial gains and losses in other comprehensive income as they occur; to immediately recognize all past-service costs; and to replace interest cost and expected return on plan assets with a net interest amount that is calculated by applying the discount rate to the net defined benefit liability (asset). In accordance with IAS 19R, entities have to apply this standard to annual periods beginning on or after 1 January 2013. The group will apply IAS 19R in the next fiscal year 2013/14. Had the group applied IAS 19R already in fiscal year 2012/13, the operating result would have been increased by TEUR 139 and the total comprehensive income for the period would have been reduced by TEUR 3,979. The provisions at the balance sheet date as of 31 March 2013 would have been higher by TEUR 5,313.
IFRS 9, 'Financial instruments', addresses the classification, measurement and recognition of financial assets and financial liabilities. IFRS 9 was issued in November 2009, October 2010 and December 2011. It replaces the parts of IAS 39, 'Financial Instruments: Recognition and Measurement', that relate to the classification and measurement of financial instruments. IFRS 9 requires financial assets to be classified into two measurement categories: those measured at fair value and those measured at amortized cost. The determination is made at initial recognition. The classification depends on the entity´s business model for managing its financial instruments and the contractual cash flow characteristics of the instrument. For financial liabilities,
the standard retains most of the IAS 39 requirements. The main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair value change due to an entity´s own credit risk is recorded in other comprehensive income rather than the statement of comprehensive income, unless this creates an accounting mismatch. The group will adopt IFRS 9 no later than the accounting period starting on 1 April 2015. Furthermore, the group will analyze the additional phase of IFRS 9 as soon as it is adopted by the IASB.
IFRS 10, 'Consolidated financial statements', builds on existing principles and introduces a single consolidation model for all entities; this model focuses on the subsidiary's control by the parent company. Furthermore, the standard provides additional guidance to assist in the determination of control where this is difficult to assess. The group will apply IFRS 10 no later than the accounting period beginning on 1 April 2014. At present, the group does not expect IFRS 10 to have significant impacts on the assets and liabilities, the financial position and operating results of the group as well as on the group's presentation.
IFRS 11, 'Joint Arrangements', changes the definition of joint ventures. In accordance with IFRS 11, a joint arrangement is defined as an agreement which gives two or more parties joint control of this arrangement. Joint control means the contractually agreed sharing of control of an arrangement and exists only when decisions about the relevant activities that significantly affect the returns of the arrangement require the unanimous consent of the parties sharing control. Each party to the joint arrangement has to account for its rights and obligations from a joint arrangement. The standard focuses on the sharing of the rights and obligations of the joint arrangement rather than on its legal form. According to IFRS 11 there are only two types of joint agreements: (i) joint operations and (ii) joint ventures. The previously applicable proportionate consolidation method will no longer be permitted for joint ventures. The parties to a joint venture have to account for the joint venture by using the equity method. IFRS 11 was adopted by European Commission Regulation dated 11 December 2012 and has to be applied for the first time retrospectively for annual periods beginning on or after 1 January 2014. The group will apply IFRS 11 in the fiscal year beginning on 1 April 2014. At present, the group does not expect IFRS 11 to have significant impacts on the assets and liabilities, the financial position and operating results of the group as well as on the group's presentation.
IFRS 12, 'Disclosure of Interests in other Entities', summarizes the revised disclosures with regard to IAS 27 and IFRS 10, IAS 31 and IFRS 11 and IAS 28 in one standard. The group will apply IFRS 12 in the accounting period beginning on 1 April 2014. At present, the group does not expect IFRS 12 to have significant impacts on the assets and liabilities, the financial position and operating results of the group as well as on the group's presentation.
IFRS 13, 'Fair Value Measurement', aims to improve consistency and reduce complexity by providing a definition of fair value and information on the disclosures to be made. The requirements, which are largely aligned between IFRS and US GAAP, do not extend the use of fair value accounting but provide guidance on how it should be applied where its use is already required or permitted by other standards within IFRSs or US GAAP. The group will apply IFRS 13 in the accounting period beginning after 1 April 2013. At present, the group does not expect IFRS 13 to have significant impacts on the assets and liabilities, the financial position and operating results of the group as well as on the group's presentation.
IAS 32, 'Financial Instruments: Presentation', complements the principles for setting off financial assets and financial liabilities. Setting of financial assets and financial liabilities will still only be possible if an entity currently has a legally enforceable right to set off the recognized amounts; it intends either to settle on a net basis or to realize the asset and settle the liability simultaneously. Changes of this standard complement and clarify the application guidance with regard to the terms 'present times' and 'simultaneousness'. The group will apply IAS 32R in the fiscal year beginning on 1 April 2014. At present, the group does not expect IAS 32R to have material impacts on the assets and liabilities, the financial position and operating results of the group as well as the group's presentation.
IFRS 7, 'Financial Instruments: Disclosures', will provide for additional disclosures with regard to the offsetting of financial assets and financial liabilities in the future. The group applies IFRS 7R retrospectively in the fiscal year beginning on 1 April 2013. At present, the group does not expect IFRS 7R to have material impacts on the assets and liabilities, the financial position and operating results of the group as well as the group's presentation.
IAS 1, 'Presentation of Financial Statements', the changes aim at clarifying the presentation of the increasing number of items under other operating income. In the future, it will only be differentiated between items of other operating income that may be reclassified to the profit for the period and items that will never be reclassified. The changes do not deal with the contents of other operating income. The change was adopted on 5 June 2012 by the EU and will be applied by the group in the fiscal year beginning on 1 April 2013.
IAS 27, 'Separate Financial Statements', will in the future only include requirements for separate financial statements in accordance with IFRS and be applied by the group in the fiscal year beginning on 1 April 2014. At present, the group does not expect IAS 27 to have material impacts on the assets and liabilities, the financial position and operating results of the group as well as the group's presentation.
IAS 28, 'Investments in Associates and Joint Ventures', extends the compulsory application of the equity method to joint ventures. The change will be applied in the fiscal year beginning on 1 April 2014. At present, the group does not expect IAS 28 to have material impacts on the assets and liabilities, the financial position and operating results of the group as well as the group's presentation.
IFRS 1, 'First-time Adoption of International Financial Reporting Standards' (Revised), contains exemptions in the event of severe hyperinflation and eliminates fixed dates for first-time adopters. EU entities have to apply the new requirements for the first time in the fiscal year beginning on or after 1 January 2013. This change does not affect the group, since the group already prepares the consolidated financial statements in accordance with IFRS.
IFRIC 20, 'Stripping Costs in the Production Phase of a Surface Mine', treats the question relating to the recognition and measurement of waste removal costs incurred in surface mining activities. In accordance with the interpretation, entities have to derecognize capitalized stripping assets through revenue reserves in the opening balance, if applicable, provided that these assets cannot be associated to an identifiable part of mining asset. IFRIC 20 applies to annual periods on or after 1 January 2013 and does not affect the group.
There are no other standards or interpretations that are not yet effective that would be expected to have a material impact on the group.
The consolidated financial statements were prepared by the management board on the undersigned date and released for publication. The entity financial statements of the parent company, which have been included in the consolidated financial statements after transition to the applicable accounting standards, have not yet been approved by the supervisory board on the undersigned date.
Subsidiaries are all entities (including special purpose entities) over which the group has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the group controls another entity. Subsidiaries are fully consolidated (full consolidation) from the date on which control is transferred to the group. They are deconsolidated from the date that control ceases.
Inter-company transactions, balances as well as unrealized gains and losses on transactions between group companies are eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group.
The group treats transactions with non-controlling interests as transactions with equity owners of the group. For purchases of non-controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals of non-controlling interests are also recorded in equity.
When the group ceases to have control or significant influence, any retained interest in the entity is re-measured to its fair value, with the change in carrying amount recognized in the profit for the period. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognized in other comprehensive income in respect of that entity are accounted for as if the group had directly disposed of the related assets or liabilities. This means that amounts previously recognized in other comprehensive income are reclassified from equity to the profit for the period.
Joint ventures are entities where two or more ventures are bound by a contractual arrangement and this contractual arrangement establishes joint control. The group accounts for joint ventures using the equity method.
Associates are entities in which the group has significant influence but not control, generally accompanied by a shareholding of between 20% and 50% of the voting rights. Associates are accounted for using the equity method. From the date of acquisition, the group's share of its associates' post-acquisition profits or losses is recognized in the statement of comprehensive income, and its share of post-acquisition movements in reserves is recognized in reserves. Goodwill on acquisition of associates is included in the investment in associates, net of any impairment losses.
The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When the group's share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the group does not recognize further losses unless it has incurred obligations or made payments on behalf of the associate.
If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognized in other comprehensive income are reclassified to the profit for the period where appropriate.
Significant unrealized gains from transactions between the group and associates are eliminated to the extent of the group's interest in the associates. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
The group uses the acquisition method of accounting to account for business combinations as at the acquisition date. The acquisition date relates to the date of transfer of control to the group.
Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, the group takes into consideration potential voting rights that are currently exercisable.
The consideration transferred for the acquisition is the fair values of the assets transferred, the equity interests issued by the group and the liabilities incurred or assumed as at the acquisition date. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed in full as incurred.
In accordance with IFRS 3, any assets acquired and liabilities (including contingent liabilities) assumed in a business combination are measured at their full fair values, irrespective of the extent of any non-controlling interests. Intangible assets are recognized separately from goodwill if they are separable from the entity or result from statutory, contractual or other legal rights. No new restructuring provisions may be recognized within the scope of the purchase price allocation. Any remaining positive differences, which compensate the seller with market opportunities that cannot be identified any closer and with development potential, are capitalized as goodwill in the respective cash generating unit (CGU).
Any contingent consideration to be transferred by the group is recognized at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is measured in accordance with IAS 39 and a resulting profit or loss recognized in the statement of comprehensive income. Contingent consideration that is classified as equity is not re-measured, and its subsequent settlement is accounted for within equity. Any contingent consideration included in the financial statements resulting from business combinations prior to the application of IFRS 3 (2008) is still treated in accordance with the requirements under IFRS 3 (2004).
Any hidden reserves and liabilities uncovered are carried forward in line with the corresponding assets and liabilities.
The determination of the fair values requires certain estimates and assumptions, in particular of the acquired intangible assets and property, plant and equipment, of the liabilities assumed as well as of the useful lives of the acquired intangible assets and property, plant and equipment.
The group recognizes any non-controlling interest in the acquiree on an acquisition-by-acquisition basis, either at fair value or at the non-controlling interest's proportionate share of the recognized amounts of the acquiree's net assets. The group measures the goodwill at the acquisition date as:
If the excess is negative, a gain on a bargain purchase is recognized directly in the profit for the period.
Items included in the financial statements of each of the group's entities are measured using the currency of the primary economic environment in which the entity operates (functional currency). The consolidated financial statements are presented in Euro, which is Kapsch TrafficCom Group's presentation currency.
In accordance with IAS 21, financial statements of foreign subsidiaries which are included in the consolidated financial statements are translated as follows:
The statement of comprehensive income of foreign entities (except for foreign entities from hyper-inflationary countries) that have a functional currency different from the Euro are translated into the group's presentation currency at average exchange rates of the fiscal year, balance sheets at the prevailing mean exchange rate at the balance sheet date. The reference rates of the European Central Bank (ECB) and Deutsche Bundesbank, which are accessible via Österreichische Nationalbank's website, serve as the basis for the translation. Exchange differences arising from the translation of the net investment subsidiaries are recognized in shareholders' equity under "Currency translation differences". When a foreign entity is sold, such exchange differences are recognized in the statement of comprehensive income as part of the gain or loss on disposal of shares in associates.
Goodwill and fair value write-ups arising on the acquisition of a foreign entity are treated as assets and liabilities of the respective foreign entity and translated at the closing rate.
| Average exchange rate | Exchange rate at the closing date | |||
|---|---|---|---|---|
| EUR | 2012/13 | 2011/12 | 2012/13 | 2011/12 |
| AUD | 1.251 | 1.319 | 1.231 | 1.284 |
| CAD | 1.296 | 1.371 | 1.302 | 1.331 |
| CZK | 25.277 | 24.722 | 25.740 | 24.730 |
| PLN | 4.168 | 4.174 | 4.180 | 4.152 |
| SEK | 8.612 | 9.002 | 8.355 | 8.846 |
| USD | 1.292 | 1.388 | 1.281 | 1.336 |
| ZAR | 10.946 | 10.210 | 11.820 | 10.232 |
The main exchange rates used during the fiscal year are shown below:
In the fiscal year 2011/12, Kapsch Telematic Services IOOO, Minsk, the Republic of Belarus, was founded. As of the balance sheet date of 31 March 2013 the Republic of Belarus is still classified as a hyperinflationary economy. The group analyzed if IAS 29 (Financial Reporting in Hyperinflationary Economies) had to be applied to the subsidiary. Since the Euro is the functional currency and not the Belorussian Ruble (BYR), the classification of the Republic of Belarus as hyperinflationary economy has no impact on accounting for the Belorussian subsidiary and thus also does not affect the present consolidated financial statements. IAS 29 will not be applied.
Foreign currency transactions are translated into the presentation currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognized in the statement of comprehensive income. Nonmonetary items in the balance sheet are translated at historical exchange rates; non-monetary items which were recognized at their lower net realizable value are translated at the exchange rate prevailing at the time of measurement.
Foreign exchange gains and losses that relate to cash and cash equivalents and borrowings are presented in the statement of comprehensive income within finance income or cost. All other foreign exchange gains and losses are presented in the statement of comprehensive income in other operating income or other operating expenses.
Primary financial instruments presented in the balance sheet include 'cash and cash equivalents', 'securities', 'financial assets and investments', 'receivables and payables' and 'loans'. For the accounting policies applicable to these items, refer to the explanation of the respective balance sheet item.
The group's activities expose it to a variety of financial risks, particularly foreign exchange risk, interest rate risk and credit risk. The group's risk management focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the group's financial performance. The group does not employ hedge accounting as envisaged by IAS 39.
Foreign exchange risk is the risk arising from fluctuations in the currency of financial instruments. In particular, foreign exchange risk exists where business transactions are made or could arise in the normal course of business in a currency other than the group's functional currency (referred to as foreign currency below).
The group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the Czech crown, Polish zloty, South-African rand and the US dollar. Due to the terms of agreement in Euro no foreign exchange risk arises with regard to the Belorussian Ruble. Customer orders are mainly invoiced in the local currencies of the group companies. Only in cases in which the group expects to be exposed to significant foreign exchange risk, major orders denominated in foreign currencies are hedged by forward foreign exchange contracts.
If the exchange rate of the stated currencies (resulting from current and non-current receivables and payables) as of 31 March 2013 (31 March 2012) had changed by the percentage rate ('volatility') stated below, the profits before tax, provided all other variables had remained unchanged, would have been higher or lower, respectively, by the following amounts.
| Currency | Volatility | Impact on the result for the period and on equity in TEUR | ||
|---|---|---|---|---|
| 2012/13 | 2011/12 | |||
| AUD | 10% | 364 | 496 | |
| CAD | 10% | 1,987 | 2,054 | |
| CZK | 10% | 337 | 3,332 | |
| EUR | 10% | -3,436 | -2,556 | |
| PLN | 10% | 933 | 10,043 | |
| SEK | 10% | 533 | 2,623 | |
| USD | 10% | 3,192 | 3,570 | |
| ZAR | 10% | 2,506 | 3,782 |
The effects for the Polish zloty in the fiscal year 2011/12 result from the implementation of the toll collection system project in Poland.
Interest rate risk is the risk arising from fluctuations in the value of financial instruments, other balance sheet items (e.g. receivables and payables) and/or cash flows due to fluctuations in the market interest rates. For fixed-interest balance sheet items, the risk comprises the present value risk. In case the market interest rate for the financial instrument fluctuates, either a profit or a loss may result if the financial instrument is sold prior to maturity.
For variable-interest balance sheet items, the risk relates to the cash flow. With variable-interest financial instruments, adjustments in the interest rates may result from changes in the market interest rates. Such changes would entail changes in interest payments. Variable-interest (both short-term and long-term) financial liabilities account for approximately one third of financial interest balance sheet items. If the market interest rate had been 100 basis points higher (lower) as of 31 March 2013, this, as in the prior year, would not have had a material impact on the result of the group. At the balance sheet date, no financial derivatives were used to hedge the interest rate risk.
As part of the group's risk management policy, the group only engages in business relationships with third parties recognized as creditworthy and implements policies to ensure that the group sells to customers with appropriate credit histories. In addition, the group monitors its receivables balances on an ongoing basis in order to limit its exposure to bad debts. Certain of the group's policies limit the amount of its credit exposure to any financial institution, depending on the rating of the institution. There is usually a credit risk in the implementation phase of large toll collection projects. With the exception of the toll collection projects in the Czech Republic, South Africa, Poland and the Republic of Belarus (see Note 18), there is no concentration of credit risk relating to trade receivables, since the group generally has a large number of customers worldwide. Based on the group's experiences, the default risk for trade receivables can be considered low.
The maximum credit risk is similar to book values:
| All amounts in TEUR | 2012/13 | 2011/12 |
|---|---|---|
| Other non-current financial assets and investments | 38,085 | 51,229 |
| Other non-current assets | 942 | 3,420 |
| Trade receivables and other current assets | 253,177 | 287,590 |
| Cash and cash equivalents | 79,022 | 44,929 |
| 371,226 | 387,168 |
Cash flow forecasting is performed in the operating entities of the group and aggregated on group level. The management monitors the rolling forecasts of the group liquidity reserves to ensure that it has sufficient cash to meet operational needs and also to secure adequate scope of unutilized credit lines at any time so that the group will neither exceed the credit lines nor injure the credit agreements.
The group is exposed to equity securities price risk resulting from a material investment, since a Norwegian investment held (Q-Free ASA), the net equity of which is subject to changes in exchange rates, is classified as available for sale in the consolidated balance sheet. The investment Q-Free ASA is dealt on the Stock Exchange.
The table below summarizes the impact of increases/decreases of the equity index of Q-Free ASA on the other comprehensive income for the period net of tax. The analysis is based on the assumption that the equity index increases/decreases by 10% with all other variables held constant.
| Index | Volatility | Impact on other comprehensive income and equity in TEUR | ||||
|---|---|---|---|---|---|---|
| 2012/13 | 2011/12 | |||||
| NO0003103103 | 10% | 3,200 | 4,098 |
The group is not exposed to any material commodity price risk.
Capital management is carried out in line with value-driven and sustainable corporate governance on the basis of the profit and loss accounts of the individual business segments. Accounting ratios and other economic criteria as well as the noncurrent development of the group are also monitored and taken into account with regard to corporate governance. A crucial ratio for the capital structure is the gearing ratio calculated as ratio of net debt to equity. Net debt (net assets) comprises current and non-current borrowings less cash on hand, bank balances and current securities. The Kapsch Group's capital management strategy aims amongst others to ensure that the group companies' capital resources comply with local requirements. Furthermore, the group focuses on maintaining the gearing ratio on an annual average within a range from 25% to 35% in order to be still able to borrow at reasonable cost. The group also continuously monitors if all covenants comply with credit agreements. The highly volatile project business may, nonetheless, be responsible that under certain circumstances the gearing ratio strategy and/or the required covenants may not be complied with.
In the reporting year, all external capital requirements resulting from the project financing of the nationwide truck toll collection systems in the Republic of Belarus and Poland were fulfilled.
The objective of this measure is to safeguard the ability to continue as a long-term going concern in order to show to shareholders and other stakeholders that their requirements can be fulfilled in a qualitative and sustainable way and that returns for shareholders and benefits for other stakeholders can be provided. Other essential objectives of the group's capital management include the financing of the envisaged growth path and the maintenance of an optimal capital structure.
| All amounts in TEUR | 2012/13 | 2011/12 |
|---|---|---|
| Non-current financial liabilities | 104,372 | 74,256 |
| Current financial liabilities | 19,658 | 53,249 |
| Total financial liabilities | 124,030 | 127,505 |
| Cash on hand and at banks | 79,022 | 44,929 |
| Current securities | 4,505 | 8,213 |
| Net assets /Net debt | -40,503 | -74,363 |
| Equity | 240,682 | 256,247 |
| Net gearing | 17% | 29% |
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. A qualifying asset is an asset (inventories, manufacturing plants, toll collection projects, power generation facilities, intangible assets and investment in properties) that necessarily takes a substantial period of time (with regard to the group at least 12 months) to get ready for its intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.
In the fiscal year 2012/13 under review, the group did not meet the requirements of a qualifying asset for any capitalized asset; therefore, no borrowing costs were capitalized. For the toll collection system project in the Republic of Belarus, which fulfills the criteria of IAS 23, borrowing costs were considered in the project calculation.
All other borrowing costs are expensed in the period in which they are incurred.
Property, plant and equipment is stated at cost less accumulated depreciation. Depreciation is charged on a straight-line basis over the expected useful lives of the assets in accordance with the group policies:
The useful lives range between 3 to 26 years for plants and buildings on leasehold land, 4 to 20 years for technical equipment and machinery and 3 to 10 years for other equipment, factory and office equipment. The assets' useful lives and residual values are reviewed, and adjusted if appropriate, at the end of each reporting period. An asset's carrying amount is written down to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount.
The difference between the proceeds from the disposal of property, plant and equipment and carrying amount is recognized as profit or loss in the result from operating activities.
Goodwill arises on the acquisition of subsidiaries, associates and joint ventures and represents the excess of the consideration transferred over the group's interest in net fair value of the identifiable assets, liabilities and contingent liabilities of the acquiree and the fair value of the non-controlling interest in acquiree at the acquisition date. If the acquisition costs are less than the net assets of the acquired subsidiary valued at fair value, the difference is recognized directly in the statement of comprehensive income.
Goodwill impairment reviews are undertaken at least annually or more frequently if events or changes in circumstances indicate a potential impairment. As a rule, the group carries out the annual goodwill impairment review in the fourth quarter. In addition, the group carries out impairment tests during the year if a triggering event occurs that the asset may be impaired.
For the purpose of impairment testing, goodwill is allocated to each of the cash generating units, or groups of cash generating units, that is expected to benefit from the synergies of the business combination and reported the goodwill. Each unit or group of units to which the goodwill is allocated in that way represents the lowest level within the entity at which the goodwill is monitored for internal management purposes.
The carrying value of goodwill is compared to the recoverable amount, which is the higher of value in use and the fair value less costs to sell. If an impairment requirement is identified, goodwill will be reduced immediately by the amount of the impairment.
The value in use of a cash generating unit corresponds to the present value, calculated using the discount cash flow method, of the future cash flows which the entity will receive from the cash generating unit. In order to determine the value in use, the expected future cash flows plus taxes based on the post-tax discount rate that reflects the current market expectations with regard to the interest effect and the specific risks of the cash generating units, are written down to their present values. In doing so, the current planning covering a period of four years (detailed forecast period) and approved by management is used as the basis with subsequent transition to perpetuity. The growth rates according to the detailed forecast period are based on historical growth data, on external studies on the future medium-term market development.
The fair value less selling cost is determined using an appropriate valuation model which is based on the medium-term planning of the respective cash generating unit. The valuation is made in line with the discounted cash flow calculations and verified through suitable multiples, if available.
Write-ups on goodwill are not made.
Computer software, trademarks and similar rights are capitalized on the basis of the costs incurred for acquisition and amortized over their estimated useful lives of 4 to 30 years. Acquired customer agreements (toll contracts, maintenance agreements) are amortized over the estimated useful lives that generally range between 2 and 10 years.
Research expenditures are recognized as an expense. Costs incurred on development projects (relating to the design and testing of new or improved products) are recognized as intangible assets when the following criteria are fulfilled:
Other development expenditures that do not meet these criteria are recognized as an expense. Development costs previously recognized as an expense are not recognized as an asset in subsequent periods. Capitalized development costs are recorded as intangible assets and amortized from the point at which the asset is ready for use on a straight-line basis over its useful life, not exceeding three years. Development assets are tested for impairment annually in accordance with IAS 36.
Assets that have an indefinite useful life – for example, goodwill or intangible assets not ready for use – are not subject to amortization and are tested annually for impairment. Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the asset should be impaired.
An impairment loss is recognized for the amount by which the asset's carrying value exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows. Assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date.
The difference between the net disposal proceeds and the carrying amount are recognized as income or expense in the result from operating activities. Gains are not classified as revenue.
The residual carrying values and useful lives are reviewed at each balance sheet date and adjusted as necessary.
Financial assets recognized under non-current assets and other short-term financial assets include available-for-sale securities and financial assets at fair value through profit and loss. Available-for-sale securities and financial assets at fair value through profit and loss are carried at fair value. Unrealized gains and losses arising from the changes in fair value of available-for-sale securities are recognized in equity under a separate item; unrealized gains and losses arising from the changes in fair value of financial assets at fair value through profit and loss are recognized immediately in the statement of comprehensive income.
The difference arising on the sale of financial assets between the proceeds and the carrying amounts is taken through profit or loss in the statement of comprehensive income. Additionally, the amount recognized in equity is taken through profit or loss in the statement of comprehensive income. All acquisitions and sales are recognized at the respective date of the transaction, transaction costs are included in acquisition costs (except for financial assets at fair value taken through profit and loss).
At each balance sheet date, the group assesses whether there is objective evidence of impairment of each significant individual financial asset or group of financial assets. If such evidence exists, the group accounts for that impairment and the amounts previously recognized in equity are removed from equity and recognized through profit or loss in the statement of comprehensive income. The amount of the impairment is recognized as the difference between the carrying amount and the present value of the estimated future cash flows.
If, in subsequent periods, the fair value of the impaired financial instrument increases and that increase can be directly related to an event occurring after the impairment was recognized through profit or loss in the statement of comprehensive income, the group reverses the impairment loss. In the case of debt instruments (for available-for-sale financial instruments), the reversal is recognized in the profit for the period in the statement of comprehensive income; in the case of equity instruments, it is recognized directly in equity.
Other available-for-sale investments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured are carried at cost less impairment.
At each balance sheet date, the group assesses whether there is objective evidence that a financial asset or a group of financial assets is impaired. If, in a subsequent period, the reason for the impairment is no longer valid, no reversal of the impairment is recognized.
For accounting purposes, derivative financial instruments are treated as standalone derivates (i.e. as independent transactions and not as hedging transactions) and thus classify as held-for-trading financial instruments and are valued at fair value through profit or loss. The fair value corresponds to the value which the relevant entity would receive or have to pay upon liquidation of the deal on the balance sheet date. Positive market values at the balance sheet date are recognized under financial assets and negative market values under other liabilities.
Changes in the fair value of these derivative financial instruments are recognized immediately in the statement of comprehensive income within other income or expense or in financial result, depending on the derivative financial instrument's purpose.
The group does not employ hedge accounting as envisaged by IAS 39.
Leasing agreements by which the group as lessee has substantially all the risks and rewards associated with the use of an asset are accounted for as finance leases.
The respective assets are capitalized under non-current assets at the net present value of minimum lease payments or the fair value of the leased asset, whichever is lower, and are depreciated over their expected useful lives or shorter lease term, if applicable. A liability with regard to finance leases is recognized in the same amount. The difference between the minimum lease payments and the accrued net present value is recognized as deferred interest expense. The interest component is spread over the agreed term of the lease using the effective interest rate method.
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the statement of comprehensive income on a straight-line basis over the period of the lease.
Government grants with regard to purchased non-current assets (technical equipment) are deferred and taken through profit or loss over the estimated useful life of the respective asset. Government grants are recognized at their fair value where there is a reasonable assurance that the group will comply with all attached conditions and the grant will be received.
Other government grants received as compensation for expenses or losses already incurred are immediately taken through profit or loss.
Inventories are stated at cost or, if lower, the net realizable value. Cost is determined using the moving average price method. Production cost includes all directly attributable expenses and fixed and variable overheads (based on normal operating capacity) incurred in connection with the production. It excludes, however, borrowing costs as they cannot be allocated to a qualifying asset. Net realizable value is the estimated selling price in the ordinary course of business less applicable variable selling expenses.
The group accounts for construction contracts in accordance with IAS 11. When the outcome of a construction contract can be estimated reliably and it is probable that the contract will be profitable, contract revenue is recognized over the period of the contract. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognized as an expense immediately. The construction progress is represented by the ratio of costs incurred by the balance sheet date and the estimated total costs for the respective project.
The carrying amount results from comparing the total of accumulated costs incurred by the balance sheet date plus the profit calculated according to the percentage of completion method (prorated) or loss (in full) on the respective construction contract to the invoiced amounts. The balance is recognized either under current assets (amounts due from customers for contract work) or under current liabilities (amounts due to customers for contract work).
Trade receivables are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method, less allowance for bad debts. An allowance for bad debts is established when there is objective evidence that the group will not be able to collect all amounts due according to the original terms of receivables. The amount of the allowance is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. The amount of the allowance is recognized in the statement of comprehensive income. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related to an event occurring after the impairment was initially recognized, the reversal of the previously recognized impairment loss is recognized through profit or loss.
For the presentation of the cash flow statement, cash and cash equivalents include cash on hand, deposits held at call and other cash at banks. Overdrafts are recognized in the balance sheet under current financial liabilities.
Provisions are set up when the group has a present legal or constructive obligation to third parties as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount can be made. If such a reliable estimate is not possible, no provisions are set up. Provisions are measured based on the estimated settlement amount. The settlement amount is the best possible estimate of an expense on the basis of which a current obligation might be settled at the balance sheet date or transferred to a third party. This estimate takes into account future cost increases that are foreseeable and likely to occur on the balance sheet date.
Provisions for warranties and liabilities for construction flaws, serial and systems problems mainly serve as coverage for obligations for free repairs and replacement deliveries, in accordance with the general sales and delivery conditions or due to individual agreements, and are measured using rates based on past experience regarding direct labor and material costs incurred, overheads, replacement deliveries or rebates. A provision is recognized for the best estimate of the costs of defects to be rectified under the warranty for products sold before the balance sheet date.
Provisions for onerous contracts are recognized if the expected benefit to be derived from the contract is less than the unavoidable costs of meeting the obligations under the contract. The provision is measured at the present value of the amount from the fulfillment of the contract or any compensation payments in case of nonperformance, whichever is lower. The recognition of impairment losses on assets dedicated to that "onerous" contract is, however, established prior to the recognition of the provisions for onerous contracts.
The group provides various post-employment benefits to employees and other long-term benefits either based on individual agreements or in accordance with local labor law provisions.
For the calculation of liabilities arising from pension obligations and termination benefits in accordance with IAS 19, the projected unit credit method is used. According to this method, post-employment costs for employee benefits are recognized in the statement of comprehensive income in such a way that scheduled costs are spread over the employees' years of service on the basis of an expert opinion by a qualified actuary, who completely re-measures the schemes annually. The obligations for pension payments are calculated as the present value of future benefits using interest rates of government bonds whose term roughly equals the term of the liability. Actuarial gains and losses exceeding the corridor (= up to 10% of benefit obligation or 10% of plan assets, if any, at beginning of period) are charged to the statement of comprehensive income over the average remaining service period of the active staff entitled to the employee benefits.
The group applies IAS 19R in the fiscal year beginning on 1 April 2013. Future actuarial adjustments are recognized through other comprehensive income.
Contributions paid by the group under a defined contribution pension scheme are charged to the statement of comprehensive income under staff costs in the period in which they occur.
For the calculation of liabilities arising from obligations for anniversary bonuses in accordance with IAS 19, the projected unit credit method is used. Anniversary bonuses are special lump-sum payments stipulated in the Collective Agreement and dependent on compensation and years of service. Eligibility is determined by a certain number of service years. The calculation of liabilities arising from obligations for anniversary bonuses is performed in the same way as the calculation for liabilities arising from termination benefits, however, without taking the corridor method into consideration.
The tax expense for the period comprises current and deferred tax. Tax is generally recognized in the statement of comprehensive income. Only taxes that relate to items recognized under equity are recognized under other comprehensive income.
The current income tax charge is calculated on the basis of the tax laws applicable at the balance sheet date in the countries where the subsidiaries and associates operate and generate taxable income.
Deferred income tax assets / liabilities are provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, if the deferred income tax assets/liabilities arise from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither IFRS profit or loss nor taxable profit or loss, it is not accounted for. Deferred income tax assets/liabilities are determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet 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 are recognized to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized.
Temporary differences mainly arise in connection with depreciation (amortization) periods of non-current assets, provisions for pension benefits, other post-employment benefits, differences regarding the measurement of receivables and payables and tax loss carry-forwards.
Deferred income tax assets/liabilities are provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal of the temporary difference is controlled by the group and it is probable that the temporary difference will not be reversed in the foreseeable future.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation authority on the same taxable entity.
Liabilities are recognized at amortized cost using the effective interest rate method. Liabilities denominated in foreign currencies are measured at the current rate at the balance sheet date. Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost; borrowing costs are charged to the statement of comprehensive income in the period in which they are incurred.
Contingent liabilities occur for two reasons. For one, they comprise possible obligations that arise from past events and whose existence will be confirmed by uncertain future events that are at least partly beyond an entity's control. For another, they comprise present obligations that fail to meet general or special recognition standards (i.e. the amount of settlement of an obligation cannot be measured with sufficient reliability or an outflow of resources to settle the obligations is not deemed probable).
The group discloses contingent liabilities unless the possibility of an outflow of resources embodying economic benefits is remote and a liability does not have to be recognized pursuant to IFRS.
In accordance with IAS 18, revenue is recognized in at fair value the statement of comprehensive income upon delivery and once the significant risks and rewards of ownership of the goods are transferred to the customer, net of discounts and eliminated sales within the group. Sales of services are recognized in the reporting period in which the services are rendered, by reference to completion of the specific transaction assessed on the basis of the actual service provided as a proportion of the total services to be provided.
Revenue for construction contracts (mainly toll collection projects) is recognized in accordance with the percentage-ofcompletion method provided the conditions under IAS 11 are met.
Other revenue is recognized by the group as follows:
The group makes estimates and assumptions concerning the future development. The resulting accounting estimates will, by definition, rarely equal the related actual results.
In particular, estimates and assumptions regarding revenue recognition have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next fiscal year.
The group uses the percentage-of-completion method in accounting for its construction contracts. Use of the percentageof-completion method requires the group to estimate the expected profit mark-up for the construction contract. Sensitivity analyses on assumptions made by management indicate that no material effect is to be expected if the actual final results should deviate by 10% from estimates. The analysis of assumptions made in the past as well as of actual profit mark-ups showed that the estimates had been reliable up to now.
Further areas where assumptions and estimates are significant to the consolidated financial statements include capitalized goodwill, inventories, deferred income tax assets/liabilities, liabilities from post-employment benefits to employees and provisions for warranties, project risks and losses from pending transactions. Sensitivity analyses of the assumptions made by management in connection with inventories, deferred taxes and provisions indicate that no material effect will arise if the actual final outcomes were to differ by 10% from the estimates made.
Sensitivities for the acquired goodwill (break-even interest rate) are detailed in Note 13. The sensitivities for obligations for post-employment benefits and anniversary bonus obligations are detailed in Note 23 and 26.
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decisionmaker. The chief operating decision-maker is responsible for allocating resources to the operating segments and assessing their performance. The executive board has been identified as the chief operating decision-maker.
Figures in the disclosure notes are presented in Euro thousands (TEUR) unless otherwise stated.
The group reports three main operating segments (see section "General Information"):
The segment information follows the same principles and same accounting policies as applied in these consolidated financial statements.
The segment results for the fiscal year ended 31 March 2013 are as follows (in EUR million):
| Road Solution Projects |
Services, System Extensions, Components Sales |
Others | Consolidated group |
|
|---|---|---|---|---|
| Revenue | 128.3 | 342.3 | 18.3 | 488.9 |
| Operating result | -51.7 | 66.1 | 0.9 | 15.3 |
The segment results for the fiscal year ended 31 March 2012 are as follows (in EUR million):
| Road Solution Projects |
Services, System Extensions, Components Sales |
Others | Consolidated group |
|
|---|---|---|---|---|
| Revenue | 229.9 | 308.1 | 12.0 | 549.9 |
| Operating result | 4.1 | 37.3 | 0.8 | 42.2 |
The segment assets and liabilities as of 31 March 2013 as well as capital expenditure, depreciation and amortization and other non-cash-effective positions for the period then ended are as follows (in EUR million):
| Road Solution Projects |
Services, System Extensions, Components Sales |
Others | Consolidated group |
|
|---|---|---|---|---|
| Assets | 153.9 | 259.9 | 10.5 | 424.4 |
| Investments in joint ventures and associates | 0.1 | 1.6 | 0.0 | 1.7 |
| Unallocated assets | 141.1 | |||
| Total assets | 154.0 | 261.5 | 10.5 | 567.2 |
| Liabilities | 73.0 | 112.2 | 4.2 | 189.4 |
| Unallocated liabilities | 137.1 | |||
| Total liabilities | 73.0 | 112.2 | 4.2 | 326.5 |
| Capital expenditure | 7.2 | 10.5 | 2.5 | 20.2 |
| Depreciation and amortization | 1.4 | 16.0 | 0.3 | 17.7 |
| Other non-cash-effective positions | 0.8 | 0.2 | 0.0 | 1.0 |
The segment assets and liabilities as of 31 March 2012 as well as capital expenditure, depreciation and amortization and other non-cash-effective positions for the period then ended are as follows (in EUR million):
| Road Solution Projects |
Services, System Extensions, Components Sales |
Others | Consolidated group |
|
|---|---|---|---|---|
| Assets | 131.8 | 301.5 | 8.8 | 442.1 |
| Investments in joint ventures and associates | 0.0 | 0.0 | 0.0 | 0.0 |
| Unallocated assets | 115.6 | |||
| Total assets | 131.8 | 301.5 | 8.8 | 557.7 |
| Liabilities | 60.4 | 87.5 | 7.8 | 155.6 |
| Unallocated liabilities | 145.8 | |||
| Total liabilities | 60.4 | 87.5 | 7.8 | 301.4 |
| Capital expenditure | 0.0 | 13.1 | 0.0 | 13.1 |
| Depreciation and amortization | 2.7 | 15.6 | 0.2 | 18.4 |
| Other non-cash-effective positions | 0.0 | 0.3 | 0.0 | 0.3 |
The breakdown of revenue by customer who contributed more than 10% to the result for the year is as follows. In addition, the respective segments are shown (in EUR million):
| 2012/13 | 2011/12 | |||||
|---|---|---|---|---|---|---|
| Revenue | Road Solution Projects |
Services, System Extensions, Components Sales |
Revenue | Road Solution Projects |
Services, System Extensions, Components Sales |
|
| Customer 1 | 85.3 | X | X | 205.1 | X | X |
| Customer 2 | 82.5 | X | 84.6 | X | X | |
| Customer 3 | 67.0 | X | 0.0 | |||
| Customer 4 | 57.9 | X | X | 72.4 | X | X |
Revenue is segmented by the location of the customer and balance sheet figures by the location of the company.
The figures for the fiscal year ended 31 March 2013 are as follows (in EUR million):
| Austria | Europe (excl. Austria) |
Americas | Rest of World | Consolidated group |
|
|---|---|---|---|---|---|
| Revenue | 38.0 | 288.9 | 74.8 | 87.2 | 488.9 |
| Non-current non-financial assets | 18.4 | 35.4 | 46.6 | 3.5 | 103.8 |
The figures for the fiscal year ended 31 March 2012 are as follows (in EUR million):
| Austria | Europe (excl. Austria) |
Americas | Rest of World | Consolidated group |
|
|---|---|---|---|---|---|
| Revenue | 32.8 | 341.4 | 63.6 | 112.1 | 549.9 |
| Non-current non-financial assets | 12.6 | 42.0 | 43.8 | 3.7 | 102.2 |
Revenues are classified into the following categories:
| 2012/13 | 2011/12 | |
|---|---|---|
| Sales of goods | 148,225 | 153,119 |
| Sales of services | 236,967 | 295,092 |
| Sales of maintenance | 34,064 | 32,573 |
| Accrued/deferred sales, license sales and discounts on invoiced sales | 69,681 | 69,137 |
| 488,937 | 549,921 |
| 2012/13 | 2011/12 | |
|---|---|---|
| Income from the sale of non-current assets | 89 | 44 |
| Income from costs recharged | 156 | 75 |
| Exchange rate gains on operative activities | 5,146 | 2,297 |
| Sundry operating income | 10,554 | 7,834 |
| 15,945 | 10,250 |
Sundry operating income mainly relates to research funding awards received and to the assumption of costs of transactions billed for the nationwide electronic truck toll collection system in the Czech Republic as well as a bonus of Kapsch TrafficCom AG, Vienna for waiving the right to terminate the rental agreement of the property Am Europlatz 2.
| 2012/13 | 2011/12 | |
|---|---|---|
| Change in unfinished goods and work in progress | 194 | 922 |
| Change in finished goods | 4,522 | -8,638 |
| 4,715 | -7,716 |
| 2012/13 | 2011/12 | |
|---|---|---|
| Cost of materials | 94,063 | 100,562 |
| Cost of purchased services | 163,505 | 186,726 |
| 257,567 | 287,288 |
| 2012/13 | 2011/12 | |
|---|---|---|
| Wages and salaries and other remunerations | 106,373 | 99,313 |
| Expenses for social security and payroll-related taxes and contributions | 22,052 | 19,837 |
| Expenses for termination benefits (see Note 23) | 824 | 895 |
| Expenses for pensions (see Note 23) | 637 | 640 |
| Contributions to pension funds and other external funds (see Note 23) | 424 | 326 |
| Fringe benefits | 1,246 | 714 |
| 131,555 | 121,725 |
As of 31 March 2013, the number of staff amounted to 3,013 persons (31 March 2012: 2,705 persons) and averaged 2,796 persons in the fiscal year 2012/13 (2011/12: 2,585).
| 2012/13 | 2011/12 | |
|---|---|---|
| Depreciation of property, plant and equipment | 8,440 | 7,065 |
| Amortization of intangible assets | 9,231 | 11,335 |
| 17,671 | 18,400 |
Low-value assets are capitalized as property, plant and equipment or intangible assets and written off in the year of acquisition, if similar assets are not material.
| 2012/13 | 2011/12 | |
|---|---|---|
| Rental expenses | 11,479 | 9,798 |
| Legal and consulting fees | 9,561 | 13,799 |
| Exchange rate losses on operative activities | 9,485 | 4,690 |
| Travel expenses | 9,425 | 9,801 |
| Communication and IT expenses | 9,269 | 7,767 |
| Marketing and advertising expenses | 9,140 | 10,467 |
| License and patent expenses | 5,528 | 4,168 |
| Automobile expenses | 5,099 | 3,970 |
| Insurance costs | 3,696 | 3,056 |
| Maintenance | 2,867 | 2,982 |
| Office expenses | 2,706 | 3,680 |
| Training costs | 2,244 | 2,005 |
| Taxes and charges | 1,627 | 603 |
| Commissions and other fees | 1,462 | 1,121 |
| Allowance and write-off of receivables | 930 | 135 |
| Transport costs | 915 | 1,746 |
| Adjustment of provision for warranties | 765 | 266 |
| Losses on disposal of non-current assets | 37 | 99 |
| Impairment Charge | 0 | 50 |
| Other | 1,587 | 2,816 |
| 87,824 | 83,020 |
The item "Other" includes membership dues and bank charges as well as other administrative and selling expenses.
| 2012/13 | 2011/12 | |
|---|---|---|
| Interest and similar income: | ||
| Interest income | 1,286 | 893 |
| Income from securities | 132 | 139 |
| Income from interest accretion of long-term receivables | 647 | 380 |
| Gains from the disposal of financial assets | 8,337 | 0 |
| Income from other investments | 7 | 1 |
| Gains from changes of the fair value of derivative financial instruments | 0 | 27 |
| Currency translation differences | 3,706 | 5,769 |
| 14,115 | 7,210 | |
| Interest and similar expenses: | ||
| Interest expense | -7,167 | -6,987 |
| Expense from interest accretion of long-term payables | -252 | -236 |
| Currency translation differences | -5,401 | -5,859 |
| -12,820 | -13,083 | |
| 1,296 | -5,873 |
| 2012/13 | 2011/12 | |
|---|---|---|
| Current taxes | -13,490 | -9,647 |
| Deferred taxes (see Note 22) | 13,313 | 785 |
| Total | -177 | -8,862 |
| Thereof income/expense from group taxation | -680 | -1,905 |
The reasons for the difference between the arithmetic tax expense/(income) based on the Austrian corporate income tax rate of 25% and the recognized tax expense/(income) are as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Profit before income taxes | 16,884 | 36,314 |
| Arithmetic tax expense based on a tax rate of 25% (2011/12: 25%) | -4,221 | -9,078 |
| Unrecognized deferred tax assets on current losses | -1,961 | -2,518 |
| De-recognition of deferred tax assets recognized on prior year losses | 0 | -130 |
| Utilization of previously unrecognized tax losses | 323 | 40 |
| Different foreign tax rates | 709 | 1,385 |
| Tax allowances claimed and other permanent tax differences | 810 | 1,019 |
| Income and expenses not subject to tax and other differences | 1,836 | 420 |
| Adjustment in respect to prior year | 2,326 | 0 |
| Recognized tax expense | -177 | -8,862 |
The adjustment in respect to prior year results from an amended profit allocation for tax purposes in the Polish subsidiary in connection with the toll collection project completed in the previous year and affects both current and deferred taxes.
For further information on deferred tax assets and liabilities see Note 22.
| 2012/13 | Before taxes | Tax expense/ income |
After taxes |
|---|---|---|---|
| Fair value gains/losses on available-for-sale financial assets: | |||
| Unrealized gains/losses in the current period | -8,254 | -180 | -8,434 |
| Gains/losses recognized in the profit for the period | -2,440 | 610 | -1,830 |
| Currency translation differences | -2,901 | -2,901 | |
| Fair value changes recognized in equity | -13,595 | 430 | -13,165 |
| 2011/12 | Before taxes | Tax expense/ income |
After taxes |
| Fair value gains/losses on available-for-sale financial assets: | |||
| Unrealized gains/losses in the current period | 11,596 | -78 | 11,518 |
| Currency translation differences | -1,542 | -1,542 | |
| Fair value changes recognized in equity | 10,054 | -78 | 9,976 |
| 2012/13 | 2011/12 | |
|---|---|---|
| Available-for-sale financial assets: | ||
| Other non-current financial assets and investments | 35,692 | 51,229 |
| Other current financial assets | 4,505 | 8,213 |
| 40,197 | 59,442 | |
| Loans and receivables: | ||
| Other non-current assets | 3,335 | 3,420 |
| Trade receivables | 72,048 | 80,495 |
| Cash and cash equivalents | 79,022 | 44,929 |
| 154,406 | 128,844 | |
| Financial liabilities at (amortized) cost: | ||
| Non-current financial liabilities | 104,372 | 74,256 |
| Other non-current liabilities | 1,766 | 3,440 |
| Trade payables | 80,220 | 59,013 |
| Current financial liabilities | 19,658 | 53,249 |
| 206,016 | 189,958 |
Financial instruments are recognized in the statement of comprehensive income with the following net results included in the profit for the period:
| 2012/13 | 2011/12 | |
|---|---|---|
| Available-for-sale financial assets | 8,477 | 167 |
| Loans and receivables | 238 | 1,183 |
| Financial liabilities at (amortized) cost | -7,419 | -7,224 |
| 1,296 | -5,873 |
| Land and buildings |
Technical equipment and machinery |
Construction in progress |
Other equipment, factory and office equipment |
Total | |
|---|---|---|---|---|---|
| Carrying amount as of 31 March 2011 | 4,256 | 7,337 | 796 | 7,015 | 19,404 |
| Currency translation differences | 0 | 56 | 36 | -29 | 63 |
| Reclassification | 0 | 0 | 0 | 1 | 1 |
| Additions | 943 | 3,602 | 1,301 | 4,803 | 10,649 |
| Disposals | -31 | -38 | -872 | -265 | -1,205 |
| Scheduled depreciation | -867 | -3,547 | 0 | -2,650 | -7,065 |
| Carrying amount as of 31 March 2012 | 4,301 | 7,410 | 1,261 | 8,875 | 21,847 |
| Acquisition/production cost | 7,690 | 41,412 | 1,261 | 20,539 | 70,902 |
| Accumulated depreciation | -3,389 | -34,002 | 0 | -11,664 | -49,055 |
| Carrying amount as of 31 March 2012 | 4,301 | 7,410 | 1,261 | 8,875 | 21,847 |
| Currency translation differences | -3 | 54 | 6 | -168 | -112 |
| Reclassification | 4 | 496 | -698 | 198 | 0 |
| Additions | 326 | 5,872 | 2,763 | 3,724 | 12,686 |
| Disposals | 0 | -9 | -1,241 | -56 | -1,306 |
| Scheduled depreciation | -807 | -4,404 | 0 | -3,229 | -8,440 |
| Carrying amount as of 31 March 2013 | 3,821 | 9,419 | 2,091 | 9,344 | 24,676 |
| Acquisition/production cost | 8,006 | 46,897 | 2,091 | 23,378 | 80,372 |
| Accumulated depreciation | -4,185 | -37,478 | 0 | -14,034 | -55,697 |
| Carrying amount as of 31 March 2013 | 3,821 | 9,419 | 2,091 | 9,344 | 24,676 |
| Capitalized development costs |
Concessions and rights |
Goodwill | Prepayments | Total | |
|---|---|---|---|---|---|
| Carrying amount as of 31 March 2011 | 122 | 40,224 | 48,341 | 0 | 88,687 |
| Currency translation differences | 0 | 2 | 695 | 0 | 696 |
| Reclassification | 0 | -1 | 0 | 0 | -1 |
| Additions | 0 | 1,469 | 943 | 0 | 2,412 |
| Disposals | 0 | -31 | 0 | 0 | -31 |
| Impairment charge | 0 | -50 | 0 | 0 | -50 |
| Scheduled amortization | -60 | -11,275 | 0 | 0 | -11,335 |
| Carrying amount as of 31 March 2012 | 63 | 30,338 | 49,979 | 0 | 80,379 |
| Acquisition/production cost | 8,743 | 55,952 | 49,979 | 0 | 114,674 |
| Accumulated amortization | -8,681 | -25,614 | 0 | 0 | -34,295 |
| Carrying amount as of 31 March 2012 | 63 | 30,338 | 49,979 | 0 | 80,379 |
| Currency translation differences | 0 | -25 | 499 | 0 | 475 |
| Additions | 0 | 3,503 | 780 | 3,264 | 7,548 |
| Disposals | 0 | 0 | 0 | 0 | 0 |
| Scheduled amortization | -60 | -9,171 | 0 | 0 | -9,231 |
| Carrying amount as of 31 March 2013 | 3 | 24,646 | 51,258 | 3,264 | 79,170 |
| Acquisition/production cost | 9,199 | 59,178 | 51,258 | 3,264 | 122,899 |
| Accumulated amortization | -9,196 | -34,533 | 0 | 0 | -43,729 |
| Carrying amount as of 31 March 2013 | 3 | 24,646 | 51,258 | 3,264 | 79,170 |
The addition to the goodwill in the fiscal year 2012/13 results from subsequent earn-out payments for the acquisition of Kapsch TrafficCom Argentina S.A., Buenos Aires, Argentina, which are accounted for under the rules of IFRS 3 (2004). Earnout payments related to the acquisition of Kapsch TrafficCom Argentina S.A., Buenos Aires, Argentina amounting to TEUR 746 are still outstanding.
For the purpose of impairment testing, goodwill was allocated to four cash-generating units (CGU) ("Road Solution Projects, Electronic Toll Collection", "Road Solution Projects, Intelligent Transportation Systems", "Services, System Extensions, Components Sales, Electronic Toll Collection" as well as "Services, System Extensions, Components Sales, Intelligent Transportation Systems"). The following assumptions were made:
| Road Solutions Projects, Electronic Toll Collection |
Road Solution Projects, Intelligent Transportation Systems |
Services, System Extensions, Components Sales Electronic Toll Collection |
Services, System Extensions, Components Sales Intelligent Transportation Systems |
|
|---|---|---|---|---|
| The carrying amount of goodwill allocated to the CGU | 39,278 | 0 | 11,247 | 733 |
| The carrying amount of intangible assets with indefinite useful lives allocated to the CGU |
0 | 0 | 0 | 0 |
| Determination of recoverable amount of CGU | Value in use | Value in use | Value in use | Value in use |
Key assumptions for determining expected cash flows of the CGU:
n Management has based its determination on the assumption that realistically possible changes in key assumptions on which the recoverable amount is based will not result in the carrying amount of goodwill of the CGU exceeding the recoverable amount of the CGU. The interest rate at which the value in use corresponds to the carrying amount is 18.1% (2011/12: 56.2%).
n The Management has based its determination on the assumption that the group will remain the preferred supplier for operation, maintenance and supply of components for toll collection projects installed in previous years.
n The Management has based its determination on the assumption that realistically possible changes in key assumptions on which the recoverable amount is based, will not result in the carrying amount of goodwill of the CGU exceeding the recoverable amount of the CGU. The interest rate where the value in use corresponds to the carrying amount is 59.2% (2011/12: 34.4%).
n The Management has based its determination on the assumption that realistically possible changes in key assumptions on which the recoverable amount is based, will not result in the carrying amount of goodwill of the CGU exceeding the recoverable amount of the CGU. The interest rate where the value in use corresponds to the carrying amount is 79.9% (2011/12: 34.4%).
Development costs relate to expenses which in accordance with IAS 38 are capitalized and amortized over 3 years once the assets are available for commercial use. Additional research and development costs of the group in the fiscal year 2012/13 amounted to EUR 59.2 million (2011/12: EUR 53.3 million). In the fiscal year 2012/13, EUR 27.4 million thereof (2011/12: EUR 23.1 million) related to project-specific development costs charged to the customer. The remaining amount of EUR 31.8 million (2011/12: EUR 30.2 million) was recognized as an expense.
Interests in joint ventures and associates developed as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Carrying amount as of 31 March of prior year | 0 | 0 |
| Addition from foundation and acquisition | 1,547 | 33 |
| Disposal | -172 | 0 |
| Share in result | 327 | -33 |
| Currency translation differences | -8 | 0 |
| Carrying amount as of 31 March of fiscal year | 1,694 | 0 |
On 31 July 2012 the group acquired 33% of the shares in SIMEX, Integración de Sistemas, S.A.P.I. de C.V., Mexico. Taking potential voting rights into account (options for purchase of the remaining shares) the group has the majority of the shares. As the potential voting rights are not assessed to be substantial the presumption of control was rebutted. As significant influence over the financial and business policies exists, the investment is accounted for using the equity method. At the last balance sheet date as of 31 December 2012, total assets of SIMEX, Integración de Sistemas, S.A.P.I. de C.V., Mexico amounted TEUR 9,987, liabilities amounted to TEUR 5,895, revenue amounted to TEUR 10,878 and the profit for the year amounted to TEUR 738.
The group founded, on 17 May 2011, together with 2 partners the joint venture LLC United Toll Systems, Moscow, Russia. The group holds a 33.3% interest in this company. On 9 November 2012, the joint venture was sold by Kapsch TrafficCom Russia OOO, Moscow, to the majority shareholder Mostotrest for the amount of EUR 6 million.
| 2012/13 | 2011/12 | |
|---|---|---|
| Other non-current financial assets and investments | 38,085 | 51,229 |
| Other current financial assets | 4,505 | 8,213 |
| 42,590 | 59,442 |
| Other non-current financial assets and investments | Available-for-sale securities |
Available-for-sale investments |
Other non-current financial assets |
Total |
|---|---|---|---|---|
| Carrying amount as of 31 March 2011 | 3,483 | 24,916 | 6,092 | 34,490 |
| Currency translation differences | 0 | 0 | 63 | 63 |
| Additions | 0 | 4,781 | 942 | 5,723 |
| Disposals | 0 | 0 | -467 | -467 |
| Change in fair value | 136 | 11,284 | 0 | 11,420 |
| Carrying amount as of 31 March 2012 | 3,619 | 40,981 | 6,629 | 51,229 |
| Currency translation differences | 0 | 0 | 202 | 202 |
| Additions | 71 | 0 | 48 | 118 |
| Disposals | -20 | 0 | -4,485 | -4,505 |
| Change in fair value | 15 | -8,974 | 0 | -8,959 |
| Carrying amount as of 31 March 2013 | 3,684 | 32,008 | 2,394 | 38,085 |
| Other current financial assets | Available-for-sale securities |
Other | Total |
|---|---|---|---|
| Carrying amount as of 31 March 2011 | 8,037 | 0 | 8,037 |
| Additions | 0 | 0 | 0 |
| Disposals | 0 | 0 | 0 |
| Change in fair value | 176 | 0 | 176 |
| Carrying amount as of 31 March 2012 | 8,213 | 0 | 8,213 |
| Additions | 0 | 0 | 0 |
| Disposals | -4,413 | 0 | -4,413 |
| Change in fair value | 705 | 0 | 705 |
| Carrying amount as of 31 March 2013 | 4,505 | 0 | 4,505 |
As of 31 March 2013, available-for-sale securities relate to government and bank bonds as well as shares in investment funds. As of 31 March 2013, investments classified as available-for-sale mainly relate to a 19.76% investment in the listed company Q-Free ASA, Trondheim, Norway.
Unrealized gains and losses are recognized in other comprehensive income of the period (see Note 10).
Other non-current financial assets relate to a fixed-term investment (2012/13: TEUR 2,394, 2011/12: TEUR 5,653). This fixedterm investment is pledged as collateral for guarantees issued by the group.
Financial assets and liabilities have to be classified in one of the three following fair value-hierarchies according to IFRS 7.27 A
Level 1. There are quoted prices in active markets for identical assets and liabilities. In the group, the investment in Q-Free ASA, Trondheim, Norway as well as listed equity instruments are attributed to Level 1.
Level 2. The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques based on observable direct or indirect market data. This category comprises available-for-sale securities, such as government and other bonds, which are quoted, however not regularly traded on a stock market.
Level 3. Financial instruments are included in level 3 if the valuation information is not based on observable market data.
| Fair value-hierarchies according to IFRS 7.27 A | 2012/13 | Level 1 Quoted prices |
Level 2 Observable market data |
Level 3 Not based on observable market data |
|---|---|---|---|---|
| Non-current financial assets | ||||
| Available-for-sale securities | 3,684 | 2,931 | 753 | 0 |
| Available-for-sale investments | 32,003 | 32,003 | 0 | 0 |
| 35,687 | 34,934 | 753 | 0 | |
| Current financial assets | ||||
| Available-for-sale securities | 4,505 | 4,505 | 0 | 0 |
| 4,505 | 4,505 | 0 | 0 | |
| Total | 40,192 | 39,439 | 753 | 0 |
In the fiscal year 2012/13, other non-current financial assets amounting TEUR 2,399 are recognized at amortized cost.
| Fair value-hierarchies according to IFRS 7.27 A | 2011/12 | Level 1 Quoted prices |
Level 2 Observable market data |
Level 3 Not based on observable market data |
|---|---|---|---|---|
| Non-current financial assets | ||||
| Available-for-sale securities | 3,619 | 2,936 | 683 | 0 |
| Available-for-sale investments | 40,977 | 40,977 | 0 | 0 |
| 44,595 | 43,913 | 683 | 0 | |
| Current financial assets | ||||
| Available-for-sale securities | 8,213 | 8,213 | 0 | 0 |
| 8,213 | 8,213 | 0 | 0 | |
| Total | 52,808 | 52,126 | 683 | 0 |
In the fiscal year 2011/12, other non-current financial assets amounting TEUR 6,634 are recognized at amortized cost.
| 2012/13 | 2011/12 | |
|---|---|---|
| Truck toll collection system Czech Republic | 940 | 3,420 |
| Other | 1 | 0 |
| 942 | 3,420 |
Other non-current assets relate to trade receivables (non-current) that are due from the Czech Ministry of Transport for the installation of the Czech truck toll collection system. As in the prior year, they fall due between 1 and 5 years as of the balance sheet date.
Non-current receivables were discounted on the basis of cash flows using an interest rate of 3.00 – 4.00% (for that part which was funded by external loans) and an interest rate for alternative investments of 2.89% (for that part which was funded by internal cash flows of the group). Thus, the fair values approximate the carrying amounts.
Gross cash flows of other non-current assets are as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Up to 2 years | 847 | 2,964 |
| Between 2 and 3 years | 139 | 623 |
| More than 3 years | 1 | 0 |
| 986 | 3,586 |
| 2012/13 | 2011/12 | |
|---|---|---|
| Purchased parts and merchandise, at acquisition cost | 33,393 | 20,637 |
| Unfinished goods and work in progress, at production cost | 10,177 | 9,984 |
| Finished goods, at production cost | 22,787 | 18,265 |
| Prepayments on inventories | 71 | 13 |
| 66,428 | 48,899 |
Individual inventory items were written down, where necessary, to their net realizable values. The write-downs of inventories amounts to TEUR 14,048 (2011/12: TEUR 12,136).
| 2012/13 | 2011/12 | |
|---|---|---|
| Trade receivables | 72,426 | 80,905 |
| Allowance for bad debts | -378 | -410 |
| Trade receivables – net | 72,048 | 80,495 |
| Amounts due from customers for contract work | 96,709 | 141,592 |
| Amounts due from customers for service and maintenance contracts | 31,296 | 18,829 |
| Receivables from tax authorities (other than income tax) | 17,374 | 13,593 |
| Other receivables and prepaid expenses | 35,749 | 33,081 |
| 253,177 | 287,590 |
Allowance for bad debt developed as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Balance as of 31 March of the prior year | -410 | -1,079 |
| Addition | -184 | -135 |
| Utilization | 5 | 223 |
| Disposal | 204 | 581 |
| Currency translation differences | 8 | 0 |
| Balance as of 31 March of the reporting year | -378 | -410 |
Maturity structure of trade receivables and other current assets:
| 2012/13 | 2011/12 | |
|---|---|---|
| Not yet due | 237,490 | 271,768 |
| Overdue, but not impaired: | ||
| Less than 60 days | 8,053 | 12,434 |
| More than 60 days | 8,012 | 3,798 |
| 253,554 | 288,000 |
Given the short maturities of these financial instruments, it is assumed that the fair values correspond to the carrying amounts. There is no concentration of credit risk with respect to trade receivables (except for the toll collection projects in the Czech Republic, South Africa and Poland), as the group generally has a large number of customers worldwide. Trade receivables (current) relating to the installation of the truck toll collection system of the Czech Republic amounting to TEUR 983 (2011/12: TEUR 3,010) and to the operation and maintenance of the system amounting to TEUR 22,312 (2011/12: TEUR 30,009) are due from Ředitelstvím silnic a dálnic ČR (RSD), a company of the Czech Republic. Trade receivables from the toll collection project in Poland due from GDDKiA (Generalna Dyrekcja Dróg Krajowych i Autostrad) amount to TEUR 9,042 (2011/12: TEUR 2,944).
Trade receivables amounting to TEUR 15,387 (2011/12: TEUR 6,840) were pledged as collateral to banks (see Note 21).
Amounts due from customers for contract work are as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Construction costs incurred plus recognized gains | 166,706 | 347,600 |
| Less amounts billed and prepayments received | -69,997 | -206,008 |
| 96,709 | 141,592 |
As of 31 March 2013, amounts due from customers for contract work relate to the toll collection project in the Republic of Belarus amounting to TEUR 68,717 (2011/12: TEUR 0) as well as extensions to the toll collection system in Poland amounting to TEUR 11,136 (2011/12: TEUR 107,253).
Revenues from construction contracts amounts to TEUR 92,702 (2011/12: TEUR 199,273).
| 2012/13 | 2011/12 | |
|---|---|---|
| Cash on hand | 67 | 60 |
| Deposits held with banks | 78,955 | 44,870 |
| 79,022 | 44,929 |
The carrying amounts of this item also represent cash and cash equivalents at the end of the reporting period as presented in the cash flow statement.
| 2012/13 | 2011/12 | |
|---|---|---|
| Carrying amount as of 31 March of fiscal year | 13,000 | 13,000 |
Following the capital increase on 27 July 2011 – 800,000 shares were issued – the registered share capital of the parent company amounts to EUR 13,000,000. The placement price was fixed at EUR 61.25 per share, resulting in gross proceeds of EUR 49 million for the group. The total number of shares issued is 13,000,000. The shares are ordinary bearer shares and have no par value.
| 2012/13 | 2011/12 | |
|---|---|---|
| Current | ||
| Loans for project financing | 5,833 | 34,000 |
| Other current loans | 13,825 | 19,249 |
| 19,658 | 53,249 | |
| Non-current | ||
| Corporate bond | 74,125 | 73,957 |
| Loans for project financing | 29,167 | 0 |
| Other non-current loans | 1,080 | 299 |
| 104,372 | 74,256 | |
| Total | 124,030 | 127,505 |
The corporate bond of Kapsch TrafficCom AG was successfully placed in November 2010 with a volume of EUR 75 million, a maturity of 7 years and an interest rate of 4.25%. The effective interest rate amounts to 4.54%.
All other non-current liabilities mature in 1 to 5 years.
The fair values and the gross cash flows of current and non-current financial liabilities are as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Carrying amount | 124,030 | 127,505 |
| Fair value | 127,164 | 124,192 |
| Gross cash flows: | ||
| Up to 1 year | 24,311 | 53,249 |
| Between 1 and 3 years | 27,095 | 9,732 |
| Between 3 and 5 years | 87,851 | 6,286 |
| More than 5 years | 0 | 75,529 |
| 139,257 | 144,796 |
Interest rates on current and non-current financial liabilities are as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Total financial liabilities: | ||
| Carrying fixed interest rates | 79,046 | 119,957 |
| Carrying variable interest rates | 44,984 | 7,548 |
| 124,030 | 127,505 | |
| Average interest rates: | ||
| Current loans | 1.10 – 3.21% | 1.56 – 2.70% |
| Loans for project financing | 5.23% | 1.37 – 1.95% |
| Corporate bond | 4.54% | 4.54% |
| Other | 1.59 – 2.90% | 2.50 – 3.86% |
Trade receivables (current) amounting to TEUR 15,387 (2011/12: TEUR 6,840) were pledged as collateral for bank guarantees and loans.
For project financing of the Belorussian toll collection system, with an outstanding amount of TEUR 35,000 as of 31 March 2013 (2011/12: TEUR 0), Kapsch TrafficCom AG obtained a guarantee of a bill of exchange of the Oesterreichischen Kontrollbank Aktiengesellschaft (OeKB) as well as a participation guarantee G4 of OeKB with a value up to TEUR 61,000 (maximum amount of the loan commitment). The claims of the participation guarantee G4 have been assigned as security of the lending banks.
A bill of exchange amounting to TEUR 1,425 (2011/12: TEUR 1,425) was issued for an export promotion credit.
| 2012/13 | 2011/12 | |
|---|---|---|
| Deferred tax assets | ||
| Deferred tax assets to be recovered after more than 12 months | 8,134 | 9,457 |
| Deferred tax assets to be recovered within 12 months | 11,393 | 1,732 |
| 19,527 | 11,189 | |
| Deferred tax liabilities | ||
| Deferred tax liabilities to be recovered after more than 12 months | 4,711 | 6,887 |
| Deferred tax liabilities to be recovered within 12 months | 8,375 | 11,429 |
| 13,086 | 18,316 | |
| Deferred tax assets net (+) / deferred tax liabilities net (-) | 6,441 | -7,127 |
Deferred taxes due to tax loss carry-forwards and other temporary differences deductible in the future are recognized only to the extent of their potential realization. In these consolidated financial statements, tax loss carry-forwards amounting to TEUR 20,104 (2011/12: TEUR 15,154) have not been recognized because it was uncertain whether there would be sufficient taxable profits available against which to offset them. These tax loss carry-forwards origin from foreign subsidiaries with the predominant part not expiring before 2030. All other deferred tax assets have been recognized in the respective group companies as future deductible items.
Deferred income tax assets and liabilities are offset, taking maturities into account, when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation authority on the same taxable entity.
Deferred tax assets/liabilities are attributable to the following positions:
| 31 March 2011 | Taken through the profit of the period |
Taken through equity |
Currency translation differences |
31 March 2012 | |
|---|---|---|---|---|---|
| Deferred tax assets | |||||
| Tax loss carry-forwards | 3,219 | 10,274 | 0 | 31 | 13,524 |
| Provisions disallowed for tax purposes | 1,077 | 7,094 | 0 | 35 | 8,206 |
| Depreciation disallowed for tax purposes | 894 | 214 | 0 | 4 | 1,112 |
| Other | 2,921 | 1,671 | -78 | -11 | 4,503 |
| 8,110 | 19,253 | -78 | 59 | 27,343 | |
| Deferred tax liabilities | |||||
| Special depreciation/amortization of non-current assets | 2 | 339 | 0 | 10 | 351 |
| Construction Contracts | 0 | 23,465 | 0 | 118 | 23,583 |
| Gains from recognition at fair value | 11,454 | -2,931 | 0 | 0 | 8,523 |
| Other | 4,420 | -2,406 | 0 | -2 | 2,012 |
| 15,876 | 18,468 | 0 | 126 | 34,470 | |
| Total change | -7,766 | 785 | -78 | -68 | -7,127 |
| 31 March 2012 | Taken through the profit of the period |
Taken through equity |
Currency translation differences |
31 March 2013 | |
|---|---|---|---|---|---|
| Deferred tax assets | |||||
| Tax loss carry-forwards | 13,524 | -7,672 | 0 | -177 | 5,675 |
| Provisions disallowed for tax purposes | 8,206 | -410 | 0 | -65 | 7,731 |
| Depreciation disallowed for tax purposes | 1,112 | 397 | 0 | 3 | 1,512 |
| Other | 4,503 | 3,893 | 430 | -25 | 8,800 |
| 27,343 | -3,791 | 430 | -264 | 23,718 | |
| Deferred tax liabilities | |||||
| Special depreciation/amortization of non-current assets | 351 | 98 | 0 | 7 | 456 |
| Construction Contracts | 23,583 | -16,538 | 0 | -91 | 6,955 |
| Gains from recognition at fair value | 8,523 | -2,050 | 0 | 0 | 6,473 |
| Other | 2,012 | 1,386 | 0 | -6 | 3,393 |
| 34,470 | -17,104 | 0 | -89 | 17,277 | |
| Total change | -7,127 | 13,313 | 430 | -174 | 6,441 |
Amounts recognized in the balance sheet:
| 2012/13 | 2011/12 | |
|---|---|---|
| Termination benefits | 7,196 | 6,452 |
| Pension benefits | 10,092 | 10,251 |
| 17,289 | 16,704 |
The obligation to set up a provision for termination benefits is based on the respective labor law.
Liabilities for retirement benefits recognized at the balance sheet date relate to retirees only. All pension agreements are based on past service cost and are not covered by external plan assets (funds). In addition, contributions are paid to an external pension fund for employees of the group (see Note 5).
Termination benefits and pension benefit obiligations were valued based on an interest rate of 3.75% (2011/12: 5.0%) and compensation increases based on a rate of 2.0% (2011/12: 3.0%). In addition, the calculation was based on the earliest possible statutory retirement age including transition provisions and using the mortality tables AVÖ 2008-P (2011/12: AVÖ 2008-P) by Pagler & Pagler. Pension increases were estimated at 2.0-3.0% (2011/12: 2.0-3.0%).
The following amounts are recognized in the statement of comprehensive income as expenses for termination benefits:
| 2012/13 | 2011/12 | |
|---|---|---|
| Current service cost | 216 | 459 |
| Interest expense | 501 | 358 |
| Actuarial losses | 107 | 79 |
| Total, included in staff costs (Note 5) | 824 | 895 |
| Change in liabilities recognized in the balance sheet: | ||
| Carrying amount as of 31 March of prior year | 6,452 | 5,912 |
| Total expense according to the table above | 824 | 895 |
| Payments | -80 | -355 |
| Carrying amount as of 31 March of fiscal year | 7,196 | 6,452 |
| Actuarial present value of obligations (defined benefit obligation) | 9,064 | 8,220 |
| Unrecognized actuarial gains/losses | -1,868 | -1,768 |
| Amount recognized in the balance sheet | 7,196 | 6,452 |
In the following sensitivity analysis for termination benefit obligations, the impacts resulting from changes in significant actuarial assumptions were changed, whereas the other impact quantities were kept constant. However in reality it will be rather likely that several of these impact quantities will change.
| Changes in assumption |
Decrease in assumption |
Increase in assumption |
|
|---|---|---|---|
| Impact of changes in the discount rate | |||
| Defined benefit obligation (DBO) | +/- 0.5% | 400 | -374 |
| Expected annual interest expenses (IC) | +/- 0.5% | -31 | 29 |
| Expected annual service costs (CSC) | +/- 0.5% | 14 | -13 |
| Impact of changes in salary increases | |||
| Defined benefit obligation (DBO) | +/- 0.5% | -362 | 384 |
| Expected annual interest expenses (IC) | +/- 0.5% | -14 | 14 |
| Expected annual service costs ( (CSC) | +/- 0.5% | -13 | 14 |
| Impact of changes in fluctuation | |||
| Defined benefit obligation (DBO) | +/- 0.5% | 9 | -8 |
| Expected annual interest expenses (IC) | +/- 0.5% | 0 | 0 |
| Expected annual service costs (CSC) | +/- 0.5% | 1 | -1 |
Amounts for the reporting period and the 4 prior years are as follows:
| 2012/13 | 2011/12 | 2010/11 | 2009/10 | 2008/09 | |
|---|---|---|---|---|---|
| Present value of obligations | 9,064 | 8,220 | 7,094 | 6,516 | 6,152 |
| Unrecognized actuarial gains/losses | -1,868 | -1,768 | -1,183 | -954 | -857 |
| Liability in the balance sheet | 7,196 | 6,452 | 5,912 | 5,561 | 5,294 |
The following amounts are recognized in the statement of comprehensive income as expenses for retirement benefits:
| 2012/13 | 2011/12 | |
|---|---|---|
| Current service cost | 9 | 44 |
| Interest expense | 595 | 581 |
| Actuarial adjustment | 32 | 15 |
| Total, included in staff costs (Note 5) | 637 | 640 |
| Change in liabilities recognized in the balance sheet: | ||
| Carrying amount as of 31 March of prior year | 10,251 | 10,616 |
| Total expense according to the table above | 637 | 640 |
| Payments | -837 | -1,064 |
| Currency translation differences | 41 | 59 |
| Total | 10,092 | 10,251 |
| Carrying amount as of 31 March of fiscal year | 10,092 | 10,251 |
| Actuarial present value of obligations (defined benefit obligation) | 13,537 | 11,902 |
| Unrecognized actuarial gains/losses | -3,445 | -1,650 |
| Amount recognized in the balance sheet | 10,092 | 10,251 |
In the following sensitivity analysis for pension obligations, the impacts resulting from changes in significant actuarial assumptions were changed, whereas the other impact quantities were kept constant. However in reality it will be rather likely that several of these impact quantities will change.
| Changes in assumption |
Decrease in assumption |
Increase in assumption |
|
|---|---|---|---|
| Impact of changes in the discount rate | |||
| Defined benefit obligation (DBO) | +/- 0.5% | 746 | -683 |
| Expected annual interest expenses (IC) | +/- 0.5% | -40 | 37 |
| Expected annual service costs (CSC) | +/- 0.5% | 1 | -2 |
| Impact of changes in salary increases | |||
| Defined benefit obligation (DBO) | +/- 0.5% | -540 | 580 |
| Expected annual interest expenses (IC) | +/- 0.5% | -20 | 22 |
| Expected annual service costs ( (CSC) | +/- 0.5% | 0 | 0 |
Amounts for the reporting period and the 4 prior years are as follows:
| 2012/13 | 2011/12 | 2010/11 | 2009/10 | 2008/09 | |
|---|---|---|---|---|---|
| Present value of obligations | 13,537 | 11,902 | 11,877 | 9,998 | 9,891 |
| Unrecognized actuarial gains/losses | -3,445 | -1,651 | -1,261 | -1,243 | -971 |
| 10,092 | 10,251 | 10,616 | 8,755 | 8,920 | |
| Fair value of plan assets | 0 | 0 | -213 | 0 | 0 |
| Liability in the balance sheet | 10,092 | 10,251 | 10,403 | 8,755 | 8,920 |
| Experience adjustment on plan liabilities | 1,467 | 237 | 50 | 266 | 491 |
| Experience adjustment on plan assets | 0 | 0 | 0 | 0 | 0 |
| 2012/13 | 2011/12 | |
|---|---|---|
| Truck toll collection system Czech Republic | 778 | 2,587 |
| Other | 988 | 853 |
| 1,766 | 3,440 |
Other non-current liabilities relate to trade payables (non-current) amounting to TEUR 778 (2011/12: TEUR 2,587) due to subcontractors for the installation of the Czech truck toll collection system. As in the prior year, these liabilities are due in more than 1 year and less than 5 years as of the balance sheet date. These non-current liabilities were discounted on the basis of cash flows using discount rates that correspond to those rates applied in discounting non-current receivables from the Czech truck toll collection system (see Note 16). Thus, the fair values approximate the carrying amounts.
Other non-current liabilities mainly relate to the non-current portion of a contingent payment obligation amounting to TEUR 394 (2011/12: TEUR 610) from the acquisition of the "Mobility Solutions" business of TechnoCom Corporation, Encino, U.S.A., in the fiscal year ending 31 March 2013.
The gross cash flows of other non-current liabilities are as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Less than 2 year | 872 | 1,870 |
| Between 2 and 3 years | 406 | 944 |
| More than 3 years | 667 | 851 |
| 1,945 | 3,665 |
| 2012/13 | 2011/12 | |
|---|---|---|
| Amounts due to customers for contract work | 12,333 | 0 |
| Prepayments received | 113 | 1,056 |
| Non-current employee liabilities | 17,150 | 16,821 |
| Liabilities to tax authorities (other than income tax) | 3,766 | 3,406 |
| Other liabilities and deferred income | 19,158 | 31,765 |
| 52,520 | 53,048 |
Amounts due to customers for contract work detail as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Construction costs incurred plus recognized gains | -139,101 | 0 |
| Less amounts billed and prepayments received | 151,434 | 0 |
| 12,333 | 0 |
As of 31 March 2013, amounts due to customers for contract work mainly relate to the toll collection project in South Africa.
| 2012/13 | 2011/12 | |
|---|---|---|
| Non-current | 1,370 | 1,098 |
| Current | 28,233 | 18,531 |
| 29,603 | 19,628 |
The provisions changed as follows:
| 31 March 2011 | Addition | Utilization | Disposal | Currency translation differences |
31 March 2012 | |
|---|---|---|---|---|---|---|
| Obligations from anniversary bonuses | 605 | 290 | 0 | -27 | 0 | 868 |
| Other | 81 | 223 | -81 | 0 | 7 | 230 |
| Non-current provisions, total | 686 | 513 | -81 | -27 | 7 | 1,098 |
| Warranties | 1,480 | 249 | -426 | -83 | 8 | 1,229 |
| Losses from pending transactions and rework |
0 | 12,320 | 0 | 0 | 63 | 12,382 |
| Legal fees, costs of litigation and contract risks |
1,442 | 697 | -35 | -1,085 | 3 | 1,022 |
| Other | 1,800 | 3,412 | -1,220 | -71 | -23 | 3,897 |
| Current provisions, total | 4,722 | 16,678 | -1,681 | -1,239 | 51 | 18,531 |
| Total | 5,408 | 17,190 | -1,763 | -1,266 | 58 | 19,628 |
| 31 March 2012 | Addition | Utilization | Disposal | Currency translation differences |
31 March 2013 | |
|---|---|---|---|---|---|---|
| Obligations from anniversary bonuses | 868 | 408 | 0 | -94 | 0 | 1,182 |
| Other | 230 | 18 | -58 | -6 | 5 | 188 |
| Non-current provisions, total | 1,098 | 426 | -58 | -100 | 5 | 1,370 |
| Warranties | 1,229 | 1,698 | -101 | -973 | 57 | 1,910 |
| Losses from pending transactions and rework |
12,382 | 6,661 | -429 | 0 | -100 | 18,514 |
| Legal fees, costs of litigation and contract risks |
1,022 | 2,251 | -686 | -59 | -5 | 2,524 |
| Other | 3,897 | 5,652 | -2,825 | -1,447 | 9 | 5,286 |
| Current provisions, total | 18,531 | 16,261 | -4,041 | -2,479 | -39 | 28,233 |
| Total | 19,628 | 16,687 | -4,099 | -2,579 | -34 | 29,603 |
The provision for anniversary bonuses relates to non-current entitlements of employees based on Collective Agreements. The valuation was based on an interest rate of 3.75% (2011/12: 5.0%), the earliest possible statutory retirement age including transition provisions and using the mortality tables AVÖ 2008-P (2011/12: AVÖ 2008-P) by Pagler & Pagler, increases in salary were considered at 2.0% (2011/12: 3.0%). In the position "Addition" interest effects amounting TEUR 42 (2011/12: TEUR 28) are included.
In the following sensitivity analysis for anniversary bonuses, the impacts resulting from changes in significant actuarial assumptions were changed, whereas the other impact quantities were kept constant. However in reality it will be rather likely that several of these impact quantities will change.
| Changes in assumption |
Decrease in assumption |
Increase in assumption |
|
|---|---|---|---|
| Impact of changes in the discount rate | |||
| Defined benefit obligation (DBO) | +/- 0.5% | 46 | -43 |
| Expected annual interest expenses (IC) | +/- 0.5% | -4 | 4 |
| Expected annual service costs (CSC) | +/- 0.5% | 4 | -4 |
| Impact of changes in salary increases | |||
| Defined benefit obligation (DBO) | +/- 0.5% | -41 | 44 |
| Expected annual interest expenses (IC) | +/- 0.5% | -2 | 2 |
| Expected annual service costs ( (CSC) | +/- 0.5% | -4 | 4 |
| Impact of changes in pension increases | |||
| Defined benefit obligation (DBO) | +/- 0.5% | 49 | -46 |
| Expected annual interest expenses (IC) | +/- 0.5% | 2 | -2 |
| Expected annual service costs (CSC) | +/- 0.5% | 5 | -4 |
As manufacturer, dealer and service provider, the group issues product warranties at the time of sale to its customers. Usually, under the terms of the warranty contract, the goup has the obligation to repair or replace manufacturing or software defects that become apparent within the period under guarantee.
When the group expects warranty claims on products sold or services rendered during the period under guarantee, a corresponding provision is set up in the financial statements. Based on the expectation that the majority of the expenditure will be incurred in the short or medium term, the best estimate for the cost of warranty is used for the recognition of the provision. Likewise, historical data is taken into account in the calculation of the provision amount. According to past experience, it is probable that there will be claims under the warranties.
The provision for losses from pending transactions and rework was set up for expected losses from not yet completed construction contracts at the balance sheet date.
Other provisions mainly include provisions for commissions and bonuses, credits receivable and project costs, discounts granted to customers and legal and consulting fees.
The group's contingent liabilities primarily result from large-scale projects. Other commitments mainly relate to contract and warranty bonds, bank guarantees, performance and bid bonds as well as sureties.
Details of contingent liabilities and other commitments are as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Contract, warranty, performance and bid bonds | ||
| Toll collection system South Africa, Gauteng | 98,202 | 114,113 |
| Toll collection system North America | 21,225 | 0 |
| Toll collection system Poland | 9,194 | 43,501 |
| Truck toll collection system Austria | 8,500 | 8,500 |
| City Highway Sydney and Melbourne | 2,775 | 1,811 |
| Truck troll collection system Czech Republic | 2,494 | 4,471 |
| Tender Slovenia | 2,000 | 0 |
| Toll collection system Portugal | 1,820 | 1,820 |
| Other | 2,842 | 906 |
| 149,052 | 175,121 | |
| Bank guarantees | 1,780 | 1,722 |
| Sureties | 64 | 524 |
| 150,896 | 177,366 |
For details of securities for above-mentioned contingent liabilities and other commitments, see Note 15 and Note 21. Further assets of Kapsch TrafficCom AB, Jönköping, Sweden, amounting to TEUR 10,772 (2011/12: TEUR 8,796) were pledged in favour of a Swedish bank in order to secure contingent liabilities.
The future payments from non-cancellable obligations from rental and operating lease contracts are presented below:
| 2012/13 | 2011/12 | |
|---|---|---|
| Up to 1 year | 12,641 | 10,279 |
| Between 1 and 5 years | 28,486 | 26,521 |
| Over 5 years | 20,528 | 5,113 |
| 61,655 | 41,914 |
The following transactions were performed with related parties:
Since January 2005 the company has provided services to the group in the area of group consolidation and legal advice. Expenses incurred by the group in the fiscal year 2012/13 amounted to TEUR 501 (2011/12: TEUR 484). Furthermore, the company invoices insurance costs (directors & officers liability insurance) to the group amounting to TEUR 22 (2011/12: TEUR 22).
For the project in South Africa (Gauteng), the company issued parental guarantees in favor of Kapsch TrafficCom AG to Unicredit Bank Austria AG, Vienna, and to Raiffeisen Bank International AG, Vienna, in September 2009. As of the balance sheet date 31 March 2013, the assumed guarantees amount to EUR 26.9 million. The annual fee for the assumption of the liabilities is 0.5% of the guaranteed amounts. Expenses incurred by the group in the fiscal year 2012/13 amounted to TEUR 257 (2011/12: TEUR 242).
KAPSCH-Group Beteiligungs GmbH acts as the tax group leader in a tax group formed in March 2005, of that Austrian subsidiaries of this group are also members. Accordingly, all post-formation tax effects of the group companies that are tax group members are considered to be related party transactions.
In connection with the use of the KAPSCH trademark and logo, the company invoices license fees to the group. The glicense fee amounts to 0.5% of all third-party sales of the group. Expenses incurred by the group in the fiscal year 2012/13 amounted to TEUR 2,327 (2011/12: TEUR 2,812).
Activities in the area of corporate development, public relations, sponsoring and other marketing activities are carried out centrally by Kapsch Aktiengesellschaft for all group companies. Cost allocated to the group in the fiscal year 2012/13 amounted to TEUR 2,224 (2011/12: TEUR 1,919).
Furthermore, the company invoices management and consulting services (including costs for the chairman of the board of the company, Georg Kapsch, and costs for consulting services of certain supervisory board members of the company) to the group. Expenses incurred by the group in the fiscal year 2012/13 amounted to TEUR 1,355 (2011/12: TEUR 1,582).
Kapsch Aktiengesellschaft has entered into various insurance contracts covering all group companies. The cost allocated to the group in the fiscal year 2012/13 amounted to TEUR 492 (2011/12: TEUR 361). In addition Kapsch Aktiengesellschaft maintains a softwaretool and invoiced TEUR 70 (2011/12: TEUR 70) to the group for this service. In fiscal year 2011/12 proportionate cost for the participation of managers at the Management Convention in Istanbul amounting to TEUR 322 were invoiced to the. In the fiscal year 2012/13 no Management Convention has taken place.
The company provides human resources services (payroll services, administration, recruiting, advice on labor law and human resources development) to the group and provides apprentices and trainees. Expenses incurred by the group in the fiscal year 2012/13 amounted to TEUR 2,293 (2011/12: TEUR 1,510).
Kapsch Components GmbH & Co KG provides logistic services to the company amounting to TEUR 14 (2011/12: TEUR 7).
The company leases telephone and IT equipment (hardware and software) to the group and provides call center services and IT support. Expenses incurred by the group in the fiscal year 2012/13 amounted to TEUR 1,173 (2011/12: TEUR 1,043).
The company delivers hardware (IT equipment) on behalf of Kapsch TrafficCom AG, Vienna, and provides maintenance and other services for various customer projects, the four largest of which by far are the "truck toll collection system Austria", the "truck toll collection system Czech Republic", the "truck toll collection system Poland" and the "truck toll collection system of the Republic of Belarus". The deliveries and services performed amounted to TEUR 6,499 in the fiscal year 2012/13 (2011/12: TEUR 3,044).
The company provides IT, data processing and telephone services to the group amounting to TEUR 4,431 (2011/12: TEUR 3,838), as well as other services amounting to TEUR 482 (2011/12: TEUR 456).
The group invoices consulting services in the area of public relations to the company. Income of the group resulting from these services in the fiscal year 2012/13 totaled TEUR 14 (2011/12: TEUR 44).
Kapsch Components GmbH & Co KG provides logistic services to the company amounting to TEUR 72 (2011/12: TEUR 76) and other services amounting to TEUR 122 (2011/12: TEUR 162).
Kapsch TrafficCom AG provides services in the area of public relations to the company. Income of the group resulting from this service in the fiscal year 2012/13 amounted to TEUR 28 (2011/12: TEUR 44).
Kapsch Components GmbH & Co KG provides logistic services to the company amounting to TEUR 880 (2011/12: TEUR 766), manufacturing services for GSM-R amounting to TEUR 2,753 (2011/12: TEUR 1,869) and provides the company with other deliverables and performances amounting to TEUR 347 (2011/12: TEUR 33).
Kapsch Components GmbH & Co KG provides logistic and manufacturing services to the company for GSM-R projects amounting to TEUR 9,542 (2011/12: TEUR 5,879) and provides the company with other deliverables and performances amounting to TEUR 153 (2011/12: TEUR 0).
The company provides technical maintenance services for the Czech truck toll collection system and is responsible for the current IT support for the Czech subsidiaries. Expenses incurred for this in the fiscal year 2012/13 totaled TEUR 1,978 (2011/12: TEUR 2,114). Furthermore, the company provided public relations services amounting to TEUR 98 in the fiscal year 2012/13 (2011/12: TEUR 100) and other services amounting to TEUR 87 (2011/12: TEUR 146).
Die Company provides hardware (IT equipment) to the group and renders maintenance and other services for the customer project in Poland. These services amounted to TEUR 2,733 in the fiscal year 2012/13 (2011/12: TEUR 4,678).
In the fiscal year 2012/13 Kapsch Immobilien GmbH sold the property Am Europlatz 2 at 31 August 2012. Lease expenses incurred in the period from April to August 2012 by the group amounted to TEUR 1,394 (2011/12: TEUR 3,266). Since that time further lease expenses have not to be shown as related parties. For waiving the right to terminate the rental agreement a bonus of TEUR 1,340 was agreed.
The company provides services in the area of motor vehicle management and automotive services amounting to TEUR 123 (2011/12: TEUR 101) in the fiscal year 2012/13.
Lease income of the group resulting from the sub-lease to related parties in the fiscal year 2012/13 totaled TEUR 438 (2011/12: TEUR 362).
Services are usually negotiated with related parties on a cost-plus basis. Goods are bought and sold at arm's length. Liabilities for pension benefits include pension obligations (pensions in payment) to the widow of Dr. Karl Kapsch, a former board member of Kapsch Aktiengesellschaft.
The following tables provides an overview of revenues and expenses at the respective balance sheet date as well as receivables from and payables due to related parties at the respective balance sheet dates:
| 2012/13 | 2011/12 | |
|---|---|---|
| Parent company | ||
| Revenue | 0 | 0 |
| Expenses | 779 | 758 |
| Affiliated companies | ||
| Revenue | 14,396 | 9,350 |
| Expenses | 25,320 | 23,122 |
| Other related parties | ||
| Revenue | 1,426 | 0 |
| Expenses | 2,690 | 4,511 |
| 2012/13 | 2011/12 | |
|---|---|---|
| Parent company | ||
| Trade receivables and other assets | 563 | 494 |
| Trade payables and other payables | 1,053 | 998 |
| Affiliated companies | ||
| Trade receivables and other assets | 2,246 | 2,707 |
| Trade payables and other payables | 11,544 | 9,486 |
| Other related parties | ||
| Trade receivables and other assets | 102 | 0 |
| Trade payables and other payables | 291 | 290 |
Earnings per share (basic earnings) are calculated by dividing the profit for the period attributable to equity holders of the company by the weighted average number of ordinary shares in issue during the year, excluding, if any, ordinary shares purchased by the Company and held as treasury shares. As of 31 March 2013, as in the prior year, no treasury shares were held by the company. There were no dilutive effects.
| 2012/13 | 2011/12 | |
|---|---|---|
| Profit for the period attributable to equity holders of the company (in EUR) | 9,682,668 | 20,599,568 |
| Weighted average number of ordinary shares | 13,000,000 | 12,744,262 |
| Earnings per share (in EUR) | 0.74 | 1.62 |
No material events have occurred after balance sheet date
The consolidated group companies are listed in the notes to the consolidated financial statements under the item "consolidated group". The parent company Kapsch TrafficCom AG, Vienna, directly or indirectly holds 100% of the shares in the fully consolidated subsidiaries, with the exception of Kapsch Telematic Services sp. z o.o. , Poland, Electronic Toll Collection (PTY) Ltd., South Africa, Kapsch Telematic Services Danmark A/S, Denmark, Kapsch Telematic Services Solutions S/A, Denmark, Kapsch Telematic Services GmbH, Vienna, Kapsch Telematic Services GmbH Deutschland, Germany, Kapsch Telematic Services Kft., Hungary, Kapsch Telematic Services spol. s r.o., Czech Republic, Kapsch TrafficCom Construction & Realization spol. s r.o., Czech Republic, TMT Services and Supplies (Pty) Ltd., South Africa, TMT Services and Supplies (Gauteng) (Pty) Ltd., South Africa, Electronic Tolling Operations (Pty) Ltd., South Africa, TMT Services and Supplies (North) (Pty) Ltd., South Africa, Berrydust 51 (Pty) Ltd., South Africa, Kapsch Telematic Services IOOO, Minsk, Republic of Belarus. With regard to additional disclosures in accordance with § 265 (2) 1 UGB for the companies mentioned above, the protection-ofinterest clause pursuant to § 265 (3) UGB was applied.
The average number of staff in the fiscal year 2012/13 was 2,579 salaried employees and 217 waged earners (2011/12: 2,404 salaried employees and 181 waged earners).
The expenses for the auditor amount to TEUR 130 (2011/12: TEUR 128) and are broken down as follows:
| 2012/13 | 2011/12 | |
|---|---|---|
| Audit of the consolidated financial statements | 56 | 58 |
| Other assurance services | 54 | 53 |
| Other services | 20 | 17 |
| 130 | 128 |
The compensation paid to members of the executive board is shown below:
| Executive board remuneration in TEUR | Fixed 2012/13 |
Variable 2012/13 |
Total 2012/13 |
Total 2011/12 |
|---|---|---|---|---|
| Georg Kapsch | 450 | 384 | 834 | 1,022 |
| Erwin Toplak | 391 | 100 | 491 | 442 |
| André Laux | 292 | 90 | 382 | 359 |
| Total | 1,133 | 574 | 1,707 | 1,823 |
Expenses for termination benefits for members of the executive board amount to TEUR 64 (2011/12: TEUR 59).
Individual pension agreements are granted to Erwin Toplak and André Laux. Annually, approximately TEUR 20 (2011/12: TEUR 19) is paid by Kapsch TrafficCom AG to an external pension fund.
Remunerations paid to supervisory board members amount to TEUR 29 (2011/12: TEUR 8)
As in the previous years, no advances or loans were granted to members of the executive and supervisory board, nor any guarantees issued in their favor.
In the fiscal year 2012/13, the following persons served on the executive board: Mag. Georg Kapsch (Chief Executive Officer) Ing. Erwin Toplak André Laux
In the fiscal year 2012/13, the following persons served on the supervisory board: Dr. Franz Semmernegg (Chairman) Dr. Kari Kapsch (Deputy-Chairman) Sabine Kauper
Delegated by the works council: Ing. Christian Windisch Claudia Rudolf-Misch
Authorized for issue:
Vienna, 27 May 2013
Georg Kapsch Erwin Toplak André Laux
Chief Executive Officer Chief Operating Officer Executive board member
We have audited the accompanying consolidated financial statements of KAPSCH-Group Beteiligungs GmbH, Vienna, for the fiscal year from 1 April 2012 to 31 March 2013. These consolidated financial statements comprise the consolidated balance sheet as of 31 March 2013, the consolidated statement of comprehensive income, the consolidated cash flow statement and the consolidated statement of changes in equity for the fiscal year ended 31 March 2013, and the notes to the consolidated financial statements.
The Company's management is responsible for the group accounting system and for the preparation and fair presentation of the consolidated financial statements in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU and in accordance with the statutory provisions of Section 245a UGB. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; making accounting estimates that are reasonable in the circumstances.
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with laws and regulations applicable in Austria and Austrian Standards on Auditing as well as in accordance with International Standards on Auditing (ISA) issued by the International Auditing and Assurance Standards Board (IAASB) of the International Federation of Accountants (IFAC). Those standards require that we comply with professional guidelines and that we plan and perform the audit to obtain reasonable assurance of whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor 's judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the group's preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the group's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a reasonable basis for our audit opinion.
Our audit did not give rise to any objections. In our opinion, which is based on the results of our audit, the consolidated financial statements comply with legal requirements and give a true and fair view of the financial position of the group as of 31 March 2013 and of its financial performance and its cash flows for the fiscal year from 1 April 2012 to 31 March 2013 in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU.
Pursuant to statutory provisions, the management report for the group is to be audited as to whether it is consistent with the consolidated financial statements and as to whether the other disclosures are not misleading with respect to the Company's position. The auditor's report also has to contain a statement as to whether the management report for the group is consistent with the consolidated financial statements and whether the disclosures pursuant to Section 243a UGB are appropriate.
In our opinion, the management report for the group is consistent with the consolidated financial statements. The disclosures pursuant to Section 243a UGB are appropriate.
Vienna, 27 May 2013
PwC Wirtschaftsprüfung GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft
signed:
Mag. Felix Wirth Austrian Certified Public Accountant
| Management Report as of 31 March 2013 77 | |
|---|---|
| Statement of all Members of the Managing Board 91 | |
| Additional Information pursuant to Section 82 Para. 4 No. 3 BörseG 92 | |
| Balance Sheet as of 31 March 2013 93 | |
| Income Statement for the fiscal year 2012/13 94 | |
| Notes to the financial statements for the fiscal year 2012/13 95 | |
| Auditor's Report 107 |
In the reporting year 2012/13, the growth of the world economy was primarily shaped by the still unresolved debt crisis in Europe: As a consequence, the eurozone slipped into a recession, with a decline in real gross domestic product (GDP) of 0.6 %. However, growth-dampening effects on the global economy came not only from the eurozone: The strong fiscal consolidation – underway throughout the OECD – is estimated to have subtracted some 1 to 1.5 percentage points from OECD-wide growth in 2012. Taking this into account, the economy of the OECD area expanded by 1.4 % in 2012, compared to 1.8 % in 2011. Additionally, the traditional growth drivers of the global economy – the Emerging Markets – saw unexpectedly sharp slowdowns in their economic performance in the reporting year, which was due, in part, to weaker export growth as well as to the restrictive course of their economic policies in the years before. All in all, global economic growth slowed to 3.2 % in 2012 from 3.9 % in 2011.
In the United States, GDP growth slowed markedly in the fourth quarter of 2012, as global uncertainty increased and restrictive government spending dampened economic activity. The economic dynamic weakened, with GDP falling to a year-on-year rate of 1.6 % in Q4 2012, compared to 2.6 % in Q3. For the reporting year as a whole, the economic output of the U.S.A. increased by 2.2 %. Invaluable impetus came primarily from gross fixed-capital formation, which accelerated in the reporting year, while private consumption, traditionally one of the main drivers of the economy in the U.S.A., considerably lost steam.
Looking ahead, U.S. economic growth is expected to drop to approximately 2 % in 2013 and concerns remain, especially regarding the country's fiscal situation: Like the eurozone, the United States needs to restore fiscal sustainability. As the White House and Congress could not reach a compromise on the federal budget, "sequestration" came into force at the beginning of March 2013, with automatic expenditure cuts totaling 1.2 trillion U.S. dollars over the next ten years, which will have a dampening effect on U.S. economic development.
In Japan, the recovery of the economy stalled in the second half of 2012, after strong growth in the first six months supported by massive reconstruction spending in response to the earthquake in March 2011. In 2012 as a whole, the Japanese economy finally expanded by 1.6 %.
As reconstruction expenditures wane further and planned tax hikes dampen private consumption, the OECD expects that GDP growth will slow to 0.7 % in 2013. Furthermore, Japan's fiscal situation remains critical: The budget deficit reached a level of about 10 % of GDP in 2012, and government debt rose to around 214 % of the country's total economic output. At the beginning of April 2013, the Bank of Japan announced a massive monetary-easing program which aims to double the monetary base by the end of 2014. The bank's primary intention is to stimulate the economy which has been struggling with deflation for years and has grown only modestly in this time.
The reporting year witnessed a further slowdown in economic development in a number of emerging markets, although they regained some ground in the last quarter of the year 2012. Forward-looking indicators suggest that this growth momentum is spilling over into 2013. Given the substantial share of the world economy now accounted for by emerging economies, they will drive growth on a global level again.
To take China, real GDP increased by 7.9 % in Q4 2012 compared with the corresponding period in 2011, and an estimated GDP growth rate of 8.2 % is expected for 2013, buoyed by the rise in domestic demand toward the end of 2012. Turning to India and Brazil, their economic performance remained subdued in 2012, with growth rates of 4.5 % (India) and 1 % (Brazil). The International Monetary Fund (IMF) expects growth in these two emerging markets to be back on track in 2013 with rates of 5.9 % (India) and 3.5 % (Brazil). The short-term outlook for the region "Emerging Markets and Developing Economies" indicates a rise in GDP of 5.5 % in 2013.
Just like in the previous year, the course of the European economy in 2012 was influenced primarily by the economic and sovereigndebt crisis. As a result of the persistently difficult situation in the Southern periphery, the aggregate GDP of the EU-27 decreased by 0.3 %. It is worth mentioning, though, that the core of the European Union was not spared the repercussions of the crisis either. France and Great Britain, for instance, saw their economies stagnate in 2012. Even the German growth engine started to sputter towards the end of the year after the country's hard efforts to fight the downward trend at the beginning of 2012. Experts believe this to be the bottom of the latest recession phase. Economic performance of the EU-27 is forecast to pick up in 2013, albeit only very slowly (+0.1 %). It is nonetheless essential that austerity measures continue to be consistently implemented throughout Europe.
As far as the eurozone is concerned, concerted efforts to fight the economic crisis in the Southern member states were once again at the top of the 2012 agenda. The situation in the severely battered Greece remained particularly difficult, seeing as the economy of the country has been stuck in a downward spiral for five years. Meanwhile, Spain also made the headlines due to its struggling banking sector, as did Italy after the reformist government led by Mario Monti had been voted out of office. Both countries faced a deep recession in 2012, just like Portugal. The only PIIGS state that seems to have overcome its severe problems is Ireland: Two consecutive years of GDP growth indicate that the economic turnaround has succeeded, not least owing to the EU rescue package. At the beginning of 2013, though, Cyprus caused a new wave of uncertainty on the financial markets.
Overall, the economic prospects for the eurozone remain subdued. Having decreased by about 0.5 % in Q4 2012, aggregate GDP is not expected to expand in the first months of 2013 either. Only for the second half of the year do experts forecast a moderate recovery in the economy.
The economic slowdown in the eurozone has also had repercussions for the states in Central and South Eastern Europe. Even though GDP growth in the region as a whole was more pronounced than in Western Europe, economic performance on a national level varied markedly in 2012. In Hungary, for instance, the on-going crisis led to a GDP decrease of 1.7 %. The Slovenian economy also contracted as a result of massive problems in its banking sector (-2 %), and the future 28th EU member Croatia struggled noticeably as well (-1.8 %). In contrast, comparatively robust growth rates were reported for Russia, Poland and the Baltic states. Looking ahead, experts predict that economic activity in the region will expand only slightly faster in 2013, as both export and domestic demand are to remain fairly weak. The year after that, however, is most likely to witness stronger growth again.
Austria. In 2012, Austria saw a deceleration in economic performance: GDP growth decreased from 2.7 % in the previous year to 0.8 %. The second half of 2012, in particular, was marked by a loss of momentum due to weaker stimuli from abroad.
The latest forecasts of economic researchers suggest, however, that the bottom was reached in time for the beginning of 2013. With several leading indicators now looking up, the Austrian economy is set to return to a growth path in Q1 2013, albeit a flat one for the present. Experts predict a moderate GDP increase of about 1 % for the entire year 2013, driven first and foremost by growing business confidence. Most notably, the manufacturing industry expects order intake to pick up again.
To allow for easier comparisons, the Kapsch TrafficCom Group makes use of the internationally prevailing terms for the intelligent transportation systems (ITS) market. These are systems in which information and communication technologies are employed to support and optimize road transportation, including infrastructure, vehicles, users and industry.
Market segmentation. The study "Intelligent Transportation Systems - A global strategic business report" from Global Industry Analysts, October 2012, describes the ITS market as a diversifying market with widely differing application and product segments. The market comprises the following product segments:
Market volume and growth. According to Global Industry Analysts, the volume of the ITS market amounted to USD 14.2 billion in 2012 and is expected to continue growing. The largest product segment in 2012 was ATMS, accounting for almost 36 % (USD 5.2 billion). Based on a worldwide volume of about USD 3.5 billion, ETC had an ITS market share of about 25 %. The largest geographic region for ITS in 2012 was the U.S.A. at 42 % (ETC: 40 %), followed by Europe at 27 % (ETC: 30 %).
The ITS market is expected to grow at an average annual rate of 8.7 % between 2009 and 2018 to reach a global volume of USD 22.8 billion in 2018, of which ETC will account for USD 7.5 billion equaling a share of 30 % and thereby exhibiting the fastest growth of all product segments at an average annual rate of 11.8 %.
Funding for infrastructure projects. The worldwide increase in road traffic requires additional financing to construct new and maintain existing roads. With the implementation of toll collection systems, toll collection offers a constant source of income and thus helps governments to provide the necessary funding for infrastructure projects. Efficient toll collection systems, especially electronic ones, offer a significant, constant and sustainable source of additional funds for governments, public authorities and concessionaires that can be used for the expansion and maintenance of road infrastructure.
The demand for the construction of new roads is largely generated by the worldwide increase in road traffic. Especially in Asia, an increased demand for electronic toll lanes is expected for the replacement and expansion of toll collection systems previously based on more traditional (manual) systems. Aside from general economic aspects, the worldwide increase in road traffic is probably the most important driver for the ITS market. According to analyses by the EU (European Union 2010, "Energy and Transport in Figures"), commercial traffic increased by 2.3 % per year and by 33.7 % in total between 1995 and 2008. Commercial road traffic increased by 2.9 % per year and by 45.7 % in total. While the recent economic crisis triggered a fall in the volume of goods transport, this has already been largely compensated for by the subsequent upswing. Despite political pressure, goods transports could not be shifted significantly from road to rail or ship.
In 2005, the trans-European road network (TEN-V) had a total length of 84,700 km and comprised one-fourth of the primary street network but carried 40 % of the total commercial traffic. It is predicted that TEN-V will be expanded by an average of 4,800 km per year up to 2020, of which 3,500 km will consist of existing roads. Major investments will be required in particular in the new EU member states and along the corridor routes to these countries. In the white paper "European transport policy for 2010", the European Commission estimated that investments of EUR 600 billion will be required by 2020. Consequently, the long-term forecasts for traffic growth remain high.
In addition to the construction of new roads, the high financing requirements for the preservation of the road infrastructure are
another factor driving the ITS market. The high funding requirements in this field in the U.S.A. (Standard & Poor's research estimates an annual demand of USD 92 billion for the preservation of highways and bridges and a further USD 125.6 billion for their improvement up to 2020) are leading to new business models and private concessionaire models.
Reducing congestion and further environmental pollution caused by road traffic. Efforts to reduce environmental pollution due to road traffic have become a market driver for the introduction of toll collection systems. Such systems encourage reduced or modified vehicle usage, thereby lowering emissions and pollution levels. Electronic toll collection systems, in particular for multi-lane free-flow traffic, have proven their ability to decrease environmental pollution and carbon dioxide emissions by reducing congestion at toll plazas without interfering with the traffic flow.
Moreover, in large conurbations and capital cities, in particular, there is a growing need for electronic systems to control and reduce traffic. Toll collection is perceived as an effective solution for reducing high levels of congestion, particularly in metropolitan areas, as mandatory payments for road usage encourage carpooling or the use of public transportation. Systems for city charging and enforcing low-emission environmental zones are deployed by cities to reduce traffic congestion and environmental pollution. Due to the politically sensitive nature of this topic, this portion of the business has developed more slowly than originally expected. Traffic safety devices to monitor compliance with traffic regulations are another field of ITS applications in cities. Examples include systems to monitor traffic violations at junctions (e.g. running red lights) as well as systems to detect speeding. The market potential of these applications is growing rapidly in cities as well as interurban areas. For municipal authorities, they often pave the way for larger and more extensive ITS solutions, such as city charging.
Enhancing traffic safety. Advanced traffic management systems in particular contribute to lower accident rates while also helping increase the probability of surviving accidents. The addressees include governments and regional authorities as well as other organizations, such as concessionaires, that are engaged in developing transport policies utilizing ITS in order to ensure the availability and quality of traffic infrastructure in a way that improves safety, performance, security and environmental protection.
Enhancing vehicle and fleet productivity. Vehicle-oriented intelligent transportation systems are aimed at in-car telematics such as remote diagnostics or advanced driver assistance systems. Their purpose is mainly to enhance vehicle productivity, particularly that of commercial vehicles (commercial vehicle operations), as well as traffic safety and security. This field includes systems for the real-time interaction between vehicles (vehicle-to-vehicle; V2V) as well as between vehicles and infrastructure (vehicle-toinfrastructure; V2I), which Kapsch TrafficCom believes will increasingly be based on 5.9 GHz technology.
Industry-oriented intelligent transportation systems are commercial applications designed to reduce the costs or maximize the revenue of vehicle fleet operators, including public transportation companies (public vehicle transportation management systems). Examples mainly include systems for fleet management and for collecting information on the logistics of large-scale vehicle operators. Addressees are also insurance companies, who see pay-as-you-drive car insurance as a promising way to attract new customers by offering fair insurance rates and ITS-based value-added mobility services.
Increased comfort expectations of travelers. User-oriented intelligent transportation systems are focused mainly on convenience and efficiency for travelers. The customer in the car receives information to aid in orientation, thereby increasing traffic safety. Example applications for advanced vehicle information systems include transmitting traffic-related vehicle information to travelers before or during the trip as well as navigation services. Adressees are information providers such as mobile telephone service providers, radio stations or also suppliers of navigation devices. As a communication platform, the 5.9 GHz technology will enable a variety of future applications involving "connected vehicles".
Depending on the requirements of the specific application, systems are introduced for toll collection which are based on microwave technology (dedicated short-range communication; DSRC), satellite navigation (global navigation satellite system; GNSS), or automatic number plate recognition (ANPR).
While in Europe the standardized technology is based on 5.8 GHz according to the Comité Européen de Normalisation (CEN) standard, toll systems in North America are based on proprietary protocols in the 915 MHz band. It is expected that a new
communication protocol standard based on 5.9 GHz will gradually replace the existing technology in the U.S.A. over the coming years. In addition to the toll application, the communication standard 5.9 GHz WAVE (Wireless Access in the Vehicular Environment) is intended for real-time vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I) communication, abbreviated as V2X, for applications that increase traffic safety as well as additional ITS solutions for traffic information, traffic management and entertainment.
A common thread among all these forces driving the market is a convergence on the ITS market expected by Kapsch TrafficCom over the next five to ten years. The company is convinced that applications, platforms and technologies will become increasingly interconnected and converge over time. In the view of Kapsch TrafficCom, the future lies in "connected vehicles in cooperative systems", which are V2X cooperative systems for real-time vehicle-to-vehicle (V2V) or vehicle-to-infrastructure (V2I) communication.
In the fiscal year under review, Kapsch TrafficCom AG managed to further position itself as internationally leading provider of innovative transport telematics systems, products and services. The company supplies products and systems for toll collection and traffic management and, in addition, offers the technical and also commercial operation, as is the case for the nationwide electronic truck toll collection system in the Czech Republic and Poland.
The fiscal year under review was primarily characterized by the beginning of the implementation of a nationwide electronic toll collection system in Belarus, the ongoing implementation of the electronic toll collection system for the multi-lane free-flow traffic in the South African province of Gauteng and the launch of the second part of the electronic toll collection system in Portugal in November 2012.
In Austria, about 2,200 km of highways and expressways are equipped with fully electronic toll systems for trucks above a maximum authorized vehicle weight of 3.5 tons, with Kapsch TrafficCom delivering the complete central and roadside infrastructure for almost 490 toll stations and now about 1 million on-board units (GO boxes) since 2004. As in the previous year, the average toll transaction rate generated in Austria remained at the high percentage of 99.8 %. On 27 September 2011, the company reached a basic agreement with ASFINAG Maut Service GmbH to renew the current operation and maintenance agreement for the nationwide electronic truck toll collection system in Austria until the end of 2018.
On 29 February 2012, Kapsch TrafficCom AG signed an agreement on the implementation of a nationwide electronic truck toll system with the Belorussian ministry of transport. The order comprises both the implementation of the system based on microwave technology for a road network totaling 2,743 km in the final stage and its technical and commercial operation for a period of 20 years. The order volume for the implementation of the system (without its operation) amounts to approximately EUR 267 million, of which EUR 158 million is attributable to the first two phases in the next two years. It is planned to put the first phase into operation on 1 July 2013.
On 29 March 2013, Kapsch TrafficCom acquired an interest of 20 % in GLONASS tolling systems OOO, Moscow, Russia.
The revenue of Kapsch TrafficCom AG reached EUR 138.7 million in fiscal year 2012/13, down by 22.9 % on the previous year (EUR 179.9 million). The segment Services, System Extensions, Components Sales (SEC) exhibited a growth in revenue from EUR 77.3 million in the previous year to EUR 91.1 million. The segment Road Solution Projects (RSP) showed a drop in revenue from EUR 102.6 million in the previous year to EUR 47.6 million.
In comparison with the previous year, personnel expenses increased by EUR 1.9 million from EUR 38.9 million to EUR 40.8 million in fiscal year 2012/13, while the average number of staff rose by 27 persons from 488 to 515 in the fiscal year under review.
Other operating expenses increased by EUR 4.6 million from EUR 38.3 million to EUR 42.9 million in fiscal year 2012/13.
The operating result (EBIT) of Kapsch TrafficCom AG fell to EUR -890k in the reporting year compared to the previous year (EUR 13.7 million).
The financial result improved to EUR 5.5 million (prior year: EUR 3.5 million), which is mainly attributable to higher income from investments.
The balance sheet total rose to EUR 365.1 million as of 31 March 2013 compared to the end of fiscal year 2011/12 (31 March 2012: EUR 352.8 million).
At EUR 181.7 million, equity was below the amount of EUR 189.5 million as of 31 March 2012. Kapsch TrafficCom AG's equity ratio thus slightly decreased from 53.7 % as of 31 March 2012 to 49.8 % as of 31 March 2013.
On the assets side, inventories increase from EUR 24.6 million to EUR 47.9 million due to the Belorussian project.
The current group receivables declined from EUR 158.4 million in the previous year to EUR 101 million in the reporting year and thus positively affect liquid funds as they rise from EUR 11.3 million to EUR 23.6 million.
On the liabilities side, the non-current liabilities in particular increased from EUR 75.6 million in the previous year to EUR 102.5 million as of 31 March 2013, which results from the financing of the implementation of the nationwide truck toll collection system in Belarus.
The current liabilities fell from EUR 83.6 million in the previous year to EUR 76.2 million as of 31 March 2013. The major change of this item occurred in the current financial liabilities that primarily declined as a result of the repayment of the credit for the Polish project.
Net cash flow from operating activities amounted to EUR 69.0 million in the current fiscal year and to EUR -49.1 million in the previous year. This development is mainly attributable to the decrease in trade receivables with regard to subsidiaries and the increase in trade payables and other accruals.
Net cash flow from investing activities in the amount of EUR -36.3 million mainly results from the financing of subsidiaries.
Net cash flow from financing activities of EUR -20.5 million (prior year: EUR 67.3 million) resulted from the repayment of current financial liabilities, primarily due to the financing of projects, and from the payment of the dividend. This could not be set off even with the increase in non-current financial liabilities.
In total, liquid funds could be increased from EUR 11.3 million as of 31 March 2012 to EUR 23.6 million as of 31 March 2013.
The toll transaction rate is a figure for assessing the accuracy and reliability of a toll system. It indicates the number of successful toll transactions of vehicles equipped with a functioning on-board unit in relation to all potential transactions. A high toll transaction rate translates to high toll income.
The average toll transaction rate of the existing truck toll collection system in Austria was approximately 99.8 % in the year 2012, thus again reaching the high level of 2011. During the same period, the average transaction rate of the nationwide electronic truck toll collection system in the Czech Republic was approximately 99.6 %, thus down by 0.1 % on the previous year (99.5 %). The calculation of the toll transaction rate is based on the calculation methods individually agreed upon with the respective customer. Therefore, the toll transaction rates achieved in different projects can only be compared to a limited extent.
The average number of staff of Kapsch TrafficCom AG in fiscal year 2012/13 was 515 (prior year: 488). As of 31 March 2013, the
company employed 502 (prior year: 519) employees.
Kapsch TrafficCom AG places great importance on the continued training and education of its employees. This involves not only promoting professional education but also providing seminars and workshops for developing personal and teamwork skills. In addition, targeted trainings are offered within the framework of the Kapsch University. A job rotation program promotes the international exchange of staff between the various locations, and select employees are prepared for their future tasks in a management trainee program.
Kapsch TrafficCom AG makes contributions to an external pension fund for employees of group companies in Austria under a defined contribution scheme. The amounts of these contributions are based on the individual employee's income and the operating profit margin of the company.
Kapsch TrafficCom AG is aware of the employees' contribution to its success and therefore rewards the commitment of its employees by distributing to them up to 5 % of the profit before income taxes of the Kapsch TrafficCom Group. Country-specific upper limits have been established to ensure that the distribution reflects local purchasing power. Every employee receives a share, which is independent of the person's salary or wage and limited to EUR 1,500 per employee.
In addition, Kapsch TrafficCom AG is committed to promoting the advancement of women in the workplace. At Kapsch TrafficCom AG, women are particularly supported through a flexible working hours scheme that is designed to help combine professional and private life. Moreover, the company cooperates with schools, universities and colleges in order to increase the promotion of women employed, among other goals. Kapsch TrafficCom AG also promotes women in the workforce through participation in specific programs such as "FIT Frauen in die Technik" or "FemTech". In addition, a committee for non-discrimination has been established within the Kapsch TrafficCom Group.
Kapsch TrafficCom AG defines its processes in an integrated management system for health and safety, security, environment and quality (HSSEQ). Valid certifications are held for quality management pursuant to ISO 9001 (since 2002), for occupational health and safety pursuant to OHSAS 18001 and for environmental management pursuant to ISO 14001 (since 2005). Kapsch TrafficCom has implemented the necessary measures in its internal processes and monitors them continuously. The certificate pursuant to ISO 27001 ensures the necessary information security management. The certificate pursuant to ISO 20000 for service management in connection with technical operations guarantees a high service quality in this area.
Kapsch TrafficCom AG believes it has a responsibility to protect the environment. In the future, the company will strive to fulfill its responsibilities toward environmental protection even more extensively, particularly through the efficient and responsible use of natural resources.
Kapsch TrafficCom AG understands the challenge of long-term and responsible business activities and is dedicated to sustainability on an economic, environmental and social level. Regularly published sustainability reports will demonstrate the progress on a group level and the continuing establishment of predefined objectives.
Living up to its socio-political responsibility, the entire Kapsch Group – organized by Kapsch AG – further supports a number of contemporary art and cultural institutions and projects and even initiates its own projects in this field. Extensive social measures as well as select educational initiatives complement this approach, which the company considers to be an obligation both inside and outside the group.
Music. A major component of this commitment consists of sponsoring activities related to the Vienna Concert Hall (Wiener Konzerthaus), a cultural institution with an excellent reputation even far beyond Austria's borders. The Kapsch Group has been the main sponsor of the Vienna Concert Hall since 1992. The "Wien Modern" festival – one of the world's best known festivals of
contemporary music – has been supported by Kapsch since its launch in 1989.
Visual arts. Promoting lesser-known artists is of particular concern to the Kapsch Group. In particular, young Austrian and international artists are assisted by sponsorship campaigns. One example is the photo calendar that the Kapsch Group has supported since 1994. The calendar is presented annually in late autumn at a private exhibition.
Educational institutions. As a company that is driven by technology and innovation, Kapsch TrafficCom AG is constantly interested in establishing contacts as early as possible with the best engineering talents. Since 2005, the Kapsch Group has supported the work of INiTS Universitäre Gründerservice Wien GmbH, which aims to support and guide young entrepreneurs in the implementation of ideas relating to well defined business concepts.
Social activities. Kapsch TrafficCom AG also supports selected social projects at home and abroad. One example of the numerous projects is ICEP, the Institute for Cooperation in Development Projects, whose activities help improve the circumstances of people in developing countries. By directly promoting migration and integration, Kapsch TrafficCom contributes to social justice, the positive development of society and long-term safety and security.
As a technology company, the Kapsch TrafficCom Group operates in a highly dynamic environment, which makes risks part and parcel of daily business. The company defines risk as the possibility to deviate from corporate goals, thus the definition of risk includes both positive (opportunities) and negative (risks) deviations from defined goals.
Risk management has been positioned as a separate function within the finance department of Kapsch TrafficCom AG, focusing on project risk management and enterprise risk management (ERM).
Project risk management analyzes beginning in the bid phase of customer projects in institutionalized processes all relevant opportunities and risks pertaining to the group's projects, thereby providing the basis for the timely planning and implementation of risk-mitigating activities.
The enterprise risk management (ERM) analyzes not only the risks of the group's key customer projects but also strategic, technological, organizational, financial, legal and IT risks, and reports them to the executive board and the audit committee of the supervisory board on a semi-annual basis. The goal of the ERM approach is early identification, analysis and control of all risks which might influence strategic and operational objectives of the company. The primary objective in this context is not to avoid risks but to deal with risks in a controlled and deliberate manner and to recognize and realize opportunities as they arise over time in order to make a valuable contribution to the management of the company.
The material risks faced by the group and the respective risk management measures are briefly explained below.
Volatility of new orders. A major portion of the share in revenues of Kapsch TrafficCom AG is generated in the segment Road Solution Projects (RSP). In this segment, the group regularly participates in tenders for the implementation and operation of large electronic toll collection systems as well as for the collection of tolls on specific road sections. On the one hand, there is the risk that tenders in which Kapsch TrafficCom AG participates or plans to participate could be delayed or withdrawn, for instance as a result of political changes, appeals or legal actions by unsuccessful bidders. On the other hand, a risk exists that Kapsch TrafficCom AG may not win its bids for new projects due to technological, financial, formal or other reasons. Recurring revenues from the technical and commercial operation of systems also depend on the successful participation in tenders for systems.
In the past, the revenues of Kapsch TrafficCom AG have been heavily influenced by the realization of implementation projects in the field of RSP in the given fiscal year. In particular, significantly higher revenues were recorded in 2003 (implementation of a nationwide electronic truck toll collection system in Austria), 2006/07 (implementation of a nationwide electronic truck toll collection system in the Czech Republic) and 2010/11 (implementation of an electronic toll collection system in the South African province of Gauteng). In fiscal year 2011/12, sizeable revenues were generated from the implementation of a nationwide electronic truck toll collection system in Poland and in fiscal year 2012/13 from the implementation of a nationwide electronic truck toll collection system in Belarus.
The strategy of Kapsch TrafficCom AG is aimed, among other things, at reducing this volatility of revenues through increased geographic diversification and increased diversification of the customer base and product portfolio as well as sustained growth in the share of technical and commercial system operation in total revenues in the interest of strengthening the segment Services, System Extensions, Components Sales (SEC).
Risks of project execution. In connection with the installation of systems, Kapsch TrafficCom AG is usually contractually obligated to provide performance guarantees. Since electronic toll collection systems and other intelligent transportation systems are frequently sophisticated and technologically complex systems that must be implemented within a short timeframe, system and product defects or missed deadlines may occur due to the limited time available. Unexpected project modifications, lack of qualified personnel, quality defects, unexpected technical problems as well as performance problems of suppliers or consortium members may also have a negative impact on project schedules. The failure to meet guaranteed performance levels or deadlines in some cases results in penalties and/or compensation for damages, sometimes also compensation for lost toll revenues. Significant deadline overruns also frequently trigger contractual clauses that enable clients to terminate contracts prematurely. A significant delay in a project, failure to achieve guaranteed performance levels or failure to implement a project in time would also reduce the chances of success in future tenders for systems. There is also the risk that Kapsch TrafficCom AG cannot execute projects in line within the set cost budgets.
Kapsch TrafficCom AG employs project management methods and project risk management methods based on IPMA (International Project Management Association) standards in order to guard against risks associated with projects.
Long-term contracts with public authorities. In many cases, the system contracts are awarded by public agencies. Framework agreements and service contracts in connection with toll collection projects may include terms and conditions that are not negotiable in a tender process and that may be disadvantageous to Kapsch TrafficCom AG. Some long-term contracts include challenging requirements with regard to the performance of the implemented systems, components and processes. These requirements can, if they are not achieved, result in significant penalties, damages or contract termination. On the other hand, some contracts include substantial bonus payments for over-fulfillment of performance requirements. In the case of long-term contracts, the margins earned can also differ from the original estimates due to changes in costs.
Liabilities arising from contracts concluded by the Kapsch TrafficCom AG may include liabilities regarding customers' loss of profit, product liabilities and other liabilities. While Kapsch TrafficCom AG's aim is to include appropriate limitations to its liability in contracts, it is still impossible to guarantee that all contracts contain sufficient limitations to the company's liability or that these limitations can be enforced under applicable law.
Capacity for innovation. The strong market position of Kapsch TrafficCom AG is, to a large extent, based on its ability to develop state-of-the-art, efficient and reliable systems, components and product. Kapsch TrafficCom AG is committed to a permanent and integrated innovation process. In order to maintain its already strong position in technology, Kapsch TrafficCom AG invests a considerable portion of its revenues in research and development. However, if the successful development of innovative systems, components and products fails, this can be detrimental to Kapsch TrafficCom AG's competitive position.
Since its capacity for innovation is based largely on technology, internal know-how and intellectual property, the global increase in product piracy and reverse engineering may have negative effects on Kapsch TrafficCom AG. In addition, any failures in protecting these technologies may have a negative impact on Kapsch TrafficCom AG's competitive position. Moreover, it is possible that systems, components, products or services could infringe on the intellectual property rights of third parties. Kapsch TrafficCom AG places great importance on the protection of technologies and internal know-how, e.g. through patents and non-disclosure agreements with the relevant contractual partners.
Acquisition and integration of companies as a part of growth. One of the strategic objectives of Kapsch TrafficCom AG is to grow internationally both by organic means and through select acquisitions and joint ventures. In the implementation of this strategy, the Kapsch TrafficCom Group has acquired and integrated companies around the world. However, a number of challenges remain in connection with this growth strategy in order to realize the desired synergies and objectives.
Country risk. The strong expansion of business activities in Eastern Europe and non-European countries has exposed Kapsch TrafficCom AG to heightened political risks. Significant and unforeseeable political changes can exert a major influence on the ability to implement or operate projects in these countries and can also affect the availability and accessibility of funds. There may also be interference with the property rights of Kapsch TrafficCom AG or complications regarding business practices and activities.
Foreign exchange risk. Kapsch TrafficCom AG maintains branches and subsidiaries in a number of countries outside the eurozone. A considerable portion of revenues and costs are denominated in the currencies of the respective foreign companies rather than in euros. Although Kapsch TrafficCom AG aims to hedge the net currency position of the individual contracts as necessary, currency fluctuations may result in exchange rate losses that may influence the consolidated financial statements (transaction risk). In addition, risks arise from the conversion of the separate financial statements of international companies into the group currency, the euro (translation risk). Fluctuations in exchange rates may also result in a change in the competitive position of Kapsch TrafficCom AG.
Interest rate risk. Within the framework of project financing, variable interest rates are regularly agreed that are tied to market interest rates (Euribor, Pribor etc.). In this context, an interest rate risk exists. Kapsch TrafficCom AG utilizes appropriate financial instruments to hedge against interest rate risks when these risks are significant.
Liquidity risk. Sufficient financial resources must be available to ensure that Kapsch TrafficCom AG can meet its payment liabilities at any time. Medium and long-term financing must be available in order to carry out large-scale projects (such as implementing a nationwide toll collection system under delayed payment terms from the client) and for acquiring other companies. Additionally, implementing large-scale projects often requires the provision of significant bank guarantees to secure bid obligations (bid bonds) or to secure possible warranty claims (performance bonds).
In financing agreements, Kapsch TrafficCom AG is subject to the customary restrictions in terms of its business policy, e.g. when drawing additional loans, using assets as collateral or providing guarantees / sureties for third parties. The availability of financing and bank guarantees depends on market conditions as well as the net assets and financial position of Kapsch TrafficCom AG and the results of operations. A lack of liquid assets (even if it is otherwise solvent), of financing or of bank guarantees can have an extremely adverse impact on the net assets and financial position of Kapsch TrafficCom AG and the results of operations.
Liquidity risk is managed by ongoing, company-wide financial and cash planning. Potential liquidity shortages can thus be identified and mitigated.
Credit risk. Kapsch TrafficCom AG is exposed to the risk of non-payment by customers. The credit ratings of new and existing customers are checked on a regular basis. Many of the key customers of Kapsch TrafficCom AG are public authorities, especially in connection with implementing and/or operating nationwide or regional toll collection systems. There is also a risk that the counterparties (including financial institutions assumed to have good credit ratings) of both original and derivative financial instruments cannot meet their payment obligations when due. A payment default or the recognition of impairment charges to receivables can be extremely detrimental to the net assets and financial position of Kapsch TrafficCom AG and the results of operations.
The success of Kapsch TrafficCom AG depends heavily on key personnel with many years of experience in the industry. Moreover, the ability to recruit qualified staff, integrate them into the company and retain them over the long-term is crucial. The loss of key personnel and difficulties in the recruitment of personnel may adversely affect the success of the group.
Kapsch TrafficCom AG has implemented a number of measures to counteract personnel risks, such as incentive schemes or employee development opportunities.
A variety of regulations and legal requirements must be observed in connection with participating in public tenders, implementing infrastructure for ITS solutions (such as toll stations) and the operation of toll collection systems. Identifying and adhering to applicable legal regulations and requirements can result in considerable administrative and technical expense. The failure to meet regulations or official requirements can lead to severe penalties and can also reduce the possibility of (successfully) taking part in tenders or continuing with the given business activity.
With the intensified expansion into new regions and select new ITS business areas, the risk of patent infringement or the violation of property rights increases. Kapsch TrafficCom AG has implemented active intellectual property (IP) management as a separate function. In order to avoid legal actions and court proceedings, Kapsch TrafficCom AG monitors potential intellectual property rights infringements continuously as well as prior to entry into new markets or regions.
As a technology group, Kapsch TrafficCom AG is exposed to typical IT risks relating to security, confidentiality and availability of data. For this reason, Kapsch TrafficCom AG has implemented an IT risk management system designed according to the corporate risk and IT security application method (CRISAM) and has been certified pursuant to ISO 27001 (information security management). Kapsch TrafficCom AG is also certified according to ISO 20000 "IT service management" (similar to ITIL) for the operation of toll collection systems.
The ERM approach of Kapsch TrafficCom AG is not only concerned with risks; it also includes the periodic identification, assessment and management of opportunities. Significant opportunities for Kapsch TrafficCom AG result from increased financing needs for infrastructure projects, relief for public budgets, global traffic growth, legislation to reduce the environmental impact of transportation, enhanced vehicle and fleet operations productivity and the increasing comfort and convenience expectations of travelers. In addition, many market opportunities arise from the geographic diversification as well as the increasing diversification of the customer base and product portfolio.
From the current perspective, no risks have been identified that could endanger the continued operations of Kapsch TrafficCom AG. Increasing geographic expansion, the diversification of the product and solution portfolio (strengthening of the ITS business) and an increased share of recurring revenues (further growth in the segment Services, System Extensions, Components Sales) are planned to further reduce the concentration of risks in the future.
Kapsch TrafficCom AG began analyzing and documenting its existing internal processes for financial reporting on an ongoing basis in fiscal year 2009/10. The results obtained so far have been presented at the quarterly meetings of the audit committee for assessment and discussion. The internal audit department ensures by audits of the subsidiaries of Kapsch TrafficCom AG that a reliable and functioning control system is implemented.
The Group IFRS Accounting Manual represents the cornerstone for financial accounting and reporting throughout the whole Kapsch Group. The manual is published and regularly updated by the Kapsch Group and contains the essential financial and reporting procedures based on the International Financial Reporting Standards (IFRS). Groupwide guidelines, work instructions and process descriptions represent another important pillar of the internal control system.
The central elements of the ICS process include regular verification of compliance with the principle of dual control and the segregation of duties as well as defined actions for monitoring the effectiveness and efficiency of operating activities, the reliability of financial reporting and the compliance with relevant legal regulations. The ICS guidelines of Kapsch TrafficCom AG follow the basic structure of the internationally recognized standards for internal control systems (COSO - Internal Control Framework of the
Committee of Sponsoring Organizations of the Treadway Commission).
The supervisory board is kept informed of business developments by the executive board during regular meetings by way of consolidated presentations consisting of segment reporting, earnings development analyses with comparisons of current figures to figures from the budget and the previous period, forecasts, group financial statements and developments in the number of employees and order inflow as well as select financial figures.
Within the finance department of Kapsch TrafficCom AG the function of an ICS manager was established. The duty of this function is to standardize and continously improve the ICS within the Kapsch TafficCom Group, to monitor the compliance and effectiveness of the controls and the improvement of found weaknesses and to report periodically to the audit committee of the supervisory board.
Due to its subsidiaries, Kapsch TrafficCom AG has an international network of research and development centers Vienna and Klagenfurt (Austria), Jönköping (Sweden), Bologna (Italy), Buenos Aires (Argentina), Toronto (Canada), and Capetown (South Africa), with Kapsch TrafficCom AG being responsible for the global coordination of the development activities in the field of R&D.
Research and development (R&D) have high priority for Kapsch TrafficCom AG in pursuing its strategic goals. The knowledge of entirely new technologies based on national and international standards and the ability to implement these form the foundation for successful business developments and also enable the entry into new markets. The current focus lies on the regions of North and South America, Russia, Australia and South-East Asia.
In the last fiscal year, the main focus of R&D was on the optimization and use of a new high-performance roadside infrastructure platform that integrates all major sensor systems into a single, common software platform. The aim was to use this platform in all international customer projects, to generate a high reusability of its basic components and ensure a low mainentance effort. This platform was already delivered to Portugal, the United States, Belarus and South Africa. Another focus was on the continous reusability and quality of centralized components, which were used for the first time in this form in Belarus.
Moreover, major R&D activities included the prototyping of traffic management, traffic management control and traffic reduction as well as of ITS solutions. Worth mentioning is the participation in standardization activities for the European ITS-G5 and the U.S. WAVE technology regarding V2X communication (vehicle-to-vehicle, vehicle-to-infrastructure). Furthermore, pilot and demonstration projects were successfully carried out in the telematics test field and at the ITS world congress 2012 in Vienna in addition to the first 5.9 GHz commercial vehicle system pilot in den U.S.A. and a 5.9 GHz parking and electronic toll collection pilot in Singapore.
The newly developed ITS vehicle platform enables vehicle-to-vehicle and vehicle-to-infrastructure-communication that delivers static and dynamic vehicle data such as size, weight, type of use, speed, direction and GPS coordinates. The research in the field of vehicle registration and vehicle classification led to the development of new video and sensor technologies with outstanding performance.
The main initiatives in the component business involved developing less expensive, energy-saving and reduced-size generations of on-board units based on DSRC, GNSS and 5.9 GHz technology.
Important organizational initiatives to reduce the costs and delivery times included further process changes, product and quality improvements on the subsystems in all R&D fields as well as the implementation of integrated development environments to cover the entire product life cycle (application life cycle management).
Successful R&D efforts are the foundation for sustained improvements in existing products and solutions as well as the continuous reduction of production, installation, operating and maintenance costs, all of which are essential for maintaining a technological and competitive advantage.
Research costs are recognized as expenses. Since the income statement has been prepared using the total expenditure format, research and development costs are reported under various items of the income statement, in particular under cost of materials and other purchased services, under personnel expenses and under other operating expenses.
In the last fiscal year, expenses for research and development amounted to EUR 39.5 million (prior year: EUR 30.8 million).
Fiscal year 2013/14 will initially be marked by a continuation of existing projects. In particular, the further developments in South Africa will influence the revenue and earnings situation. In addition, an invitation to tender has already begun in Slovenia. Kapsch TrafficCom AG expects additional tenders in Belgium and the U.S.A. Extensive toll collection systems are under discussion in Bulgaria, Russia and the surrounding countries as well as in Germany. Kapsch TrafficCom is following these discussions with great interest.
No material events have occurred after the balance sheet date.
Vienna, 27 May 2013
Georg Kapsch m.p. Erwin Toplak m.p. André Laux m.p.
Chief Exectuive Officer Executive Board member Executive Board member
Statement of all Members of the Management Board pursuant to Section 82 Para. 4 No. 3 BörseG (Austrian Stock Exchange Act)
We declare to the best of our knowledge that the financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the company as required by the applicable accounting standards and that the management report gives a true and fair view of the development and performance of the business and the position of the company, together with a description of the principal risks and uncertainties the company faces.
Vienna, 27 May 2013
Mag.
Georg
Kapsch
Ing.
Erwin
Toplak André
Laux
Chief
Executive
Officer Chief Operating Officer Executive Board member
| Board Member | Area of responsibility |
|---|---|
| Georg Kapsch (CEO) | Finance and Administration, Mergers & Acquisitions, Investor Relations, Legal, International Subsidiaries, Human Resources, Marketing & Communications, International Relations & Affairs, Innovation Management, Production, Operations and Sales Region North America |
| Erwin Toplak (COO) | Sales Region 1, Business Development Electronic Toll Collection, Plattform Management and Research & Development |
| André F. Laux (Executive Board Member) | Sales Region 2, Business Development Intelligent Transportation Systems, Product and Project Management |
| 31/3/2013 | 31/3/2012 | 31/3/2013 | 31/3/2012 | ||
|---|---|---|---|---|---|
| EUR | EUR '000 | EUR | EUR '000 | ||
| A. Fixed assets | Shareholders' equity दं |
||||
| Intangible assets | Share capital | 13,000,000.00 | 13,000 | ||
| 1. Industrial property and similar rights and assets, and | Capital reserves | ||||
| licenses in such rights and assets | 3,480,716.11 | 1,145 | Appropriated | 117,400,000.00 | 117,400 |
| Prepayments and construction in process $\mathbf{a}$ |
3,108,966.18 | Unappropriated retained earnings, thereof prior period ≝ |
51,297,087.80 | 59,103 | |
| 6,589,682.29 | 1,145 | unappropriated retained earnings brought forward | |||
| Tangible assets $=$ |
EUR 47,402,815.58 (prior year: EUR 43,869K) | ||||
| . Investments in leasehold buildings | 2,286,328.73 | 2,526 | 181,697,087.80 | 189,503 | |
| Technical equipment and machinery $\alpha$ |
678,820.04 | 519 | |||
| Other equipment, factory and office equipment $\vec{0}$ |
2,194,158.69 | 2,303 | B. Investment grants | 441,386.56 | 518 |
| Prepayments and construction in process $\vec{r}$ |
185, 137.56 | 0 | |||
| 5,344,445.02 | 5,348 | ||||
| Financial assets $\equiv$ |
Accruals ن ت |
||||
| 1. Shares in affiliated companies | 60,742,816.40 | 62,498 | Accruals for severance payments | 3,728,135.00 | 3,001 |
| 2. Participating interests | 17,188,008.58 | 17,188 | Other accruals - ผ่ |
29,050,490.31 | 18,392 |
| Securities ത് |
4,509,462.30 | 8,217 | 32,778,625.31 | 21,393 | |
| 82,440,287.28 | 87,903 | ||||
| ,414.59 94,374 |
94,396 | Accounts payable d |
|||
| B. Current asets | Bonds | 75,000,000.00 | 75,000 | ||
| Inventories | Bank loans and overdrafts Νi |
36,425,462.56 | 42,175 | ||
| 1. Merchandise | 15,555,580.17 | 12,170 | Customer advances 60 |
377.69 | $\overline{300}$ |
| 2. Services not yet invoiced | 25,245,109.93 | 5,627 | Trade payables 4 |
8,074,575.31 | 4,404 |
| Prepayments က် |
1,243.10 7.064 |
6,860 | Payables to affiliated companies ယ |
26,344,176.52 | 13,441 |
| $\frac{20}{1,933.20}$ 47,864 |
24,657 | Other liabilities ဖ |
4,298,807.98 | 6,035 | |
| Receivables and other assets $\equiv$ |
of which taxes EUR 70,295.21 (prior year: EUR 65k), | ||||
| 1. Trade receivables | 8,890,741.39 | 4,943 | of which social security payables EUR 754,648.08 | ||
| Receivables from affiliated companies $\overline{\mathbf{N}}$ |
1,222.83 179,323 |
210,919 | (prior year: EUR 727k) | ||
| Other assets က် |
487.17 8,199 |
4,904 | 150, 143, 400.06 | 141,355 | |
| 1,451.39 196,413 |
220,766 | ||||
| III. Cash, bank balances | 23,563,057.27 | 11,300 | |||
| ,441.86 267,841 |
256,723 | ||||
| C. Prepaid expenses and deferred charges | 1,643.28 2.844 |
1,650 | |||
| ,499.73 365,060 |
352,769 | 365,060,499.73 | 352,769 |
| 2012/13 | 2011/12 | |
|---|---|---|
| EUR | EUR '000 | |
| 1. Net sales | 138,732,940.03 | |
| 2. Change in services not yet invoiced | 17,680,672.52 | 179,944 $-7,724$ |
| 3. Other operating income | ||
| a) Income from the retirement of fixed assets excluding financial | ||
| assets | 199.92 | |
| b) Income from the reversal of accruals | 3,800,387.22 | 161 |
| c) Other | 13,671,949.20 | 10,030 |
| 17,472,536.34 | 10,192 | |
| 4. Cost of materials and purchased services | ||
| a) Cost of materials | $-25, 199, 364.55$ | $-37,078$ |
| b) Cost of purchased services | $-63,805,219.99$ | $-52,131$ |
| $-89,004,584.54$ | $-89,209$ | |
| 5. Personnel expenses | ||
| a) Wages | $-176,383.05$ | $-148$ |
| b) Salaries | $-30,652,434.59$ | $-30,456$ |
| c) Expenses for severance payments and contributions to staff | ||
| provision funds | $-1,822,080.85$ | $-656$ |
| d) Expenses for pensions | $-70,488.00$ | $-69$ |
| e) Expenses for statutory social security, payroll-relates taxes and | ||
| mandatory contributions | $-7,911,681.87$ | $-7,400$ |
| f) Other social benefits | $-222,563.82$ | $-212$ |
| $-40,855,632.18$ | $-38,941$ | |
| 6. Depreciation and amortization of fixed intangible and tangible assets | $-1,993,520.71$ | $-2,169$ |
| 7. Other operating expenses | ||
| a) Taxes not included in line 17 | $-805, 177.78$ | $-757$ |
| b) Other | $-42, 117, 522.35$ | $-37,599$ |
| -42,922,700.13 | $-38,356$ | |
| 8. Subtotal of lines 1 to 7 (Operating result) | $-890,288.67$ | 13,737 |
| 9. Income from participating interests, of which from affiliated | ||
| companies EUR 6,720,000.00 (prior year: EUR 4,461k) | 6,720,000.00 | 4,461 |
| 10. Income from other long-term securities | 28,706.31 | 26 |
| 11. Other interest and similar income, of which from affiliated | ||
| companies EUR 3,780,920.82 (prior yerar: EUR 3,842k) | 4,014,495.28 | 3,953 |
| 12. Income from the retirement and write-up of fixed financial assets | 1,232,908.61 | 177 |
| 13. Expenses on fixed financial assets, of which | $-2,936,333.33$ | $-751$ |
| a) Amounts written off EUR 2,936,333.33 (prior year: EUR 751k) | ||
| b) Relating to affiliated companies EUR 2,936,333.33 | ||
| (prior year: EUR 751k) 14. Interest and similar expenses, of which relating to affiliated |
||
| companies EUR 78,825.17 (prior year: EUR 129k) | ||
| 15. Subtotal of lines 9 to 14 (Financial result) | $-3,522,956.34$ | $-4,389$ |
| 16. Net operating income | 5,536,820.53 4,646,531.86 |
3,477 17,214 |
| 17. Taxes on income, thereof recharged to group parent | ||
| EUR 748,439.60 (prior year: EUR 1,980k) | $-752,259.64$ | $-1,980$ |
| 18. Net income for the year | 3,894,272.22 | 15,234 |
| 19. Prior period unappropriated retained earnings brought forward | 47,402,815.58 | 43,869 |
| 20. Unappropriated retained earnings | 51,297,087.80 | 59,103 |
The financial statements as of 31 March 2013 have been prepared in accordance with the financial reporting requirements of the Austrian Commercial Code (UGB) as amended.
The financial statements, prepared under Austrian generally accepted accounting principles, present a true and fair view of the assets and liabilities, the financial situation of the Company, as well as its results of operations.
Accounting and valuation methods are based on generally accepted accounting principles. Section 201 (2) UGB was adhered to, as were the provisions on classification and valuation of balance sheet and income statement items under Sections 195 to 211 and 222 to 235 UGB. The income statement was prepared in accordance with the total expenditure format.
Purchased intangible assets and tangible assets are valued at acquisition or production cost less scheduled straight-line amortization/depreciation charged according to the estimated useful life of the assets.
Low-value assets with individual acquisition costs of less than EUR 400 were fully written off in the year of acquisition or production.
Acquired IT software is amortized based on a useful life of between four to eight years.
Tangible assets were depreciated on a straight-line basis over the following useful lives:
| Years | |
|---|---|
| Investments in leasehold buildings | 2 - 12 |
| Technical equipment and machinery | 2 - 5 |
| Other equipment, factory and office equipment | 2 - 15 |
No unscheduled depreciation was charged in the fiscal year.
Additions to fixed assets are depreciated according to the date of their initial use.
Financial assets are stated at acquisition costs or the lower market values at the balance sheet date. Write-downs / write-ups are made only in case a diminution / increase in value is expected to be permanent.
Foreign currency receivables are stated using the exchange rate at the date of the transaction or the lower bank buying rate at the balance sheet date.
Foreign currency payables are stated using the exchange rate at the date of the transaction or the higher bank selling rate at the balance sheet date.
Inventories and receivables were stated in accordance with the strict lower of cost or market principle.
The stocks of purchased goods, recorded by means of electronic data processing, were stated using the moving average price method. Inventories denominated in foreign currencies were stated using the exchange rate at the date of acquisition. Where required, write-downs were made to the lower replacement costs.
A proportional deduction from acquisition or production cost was made for goods with diminished usability or marketability, which was derived from the respective inventory turnover ratio. In case of long-term contracts, no administrative and selling overheads were capitalized (option provided by Section 206 (3) UGB), directly attributable finance cost were capitalized for the first time in the fiscal year.
Receivables were stated at nominal values. Identifiable risks were considered in the valuation of the individual receivables by write-offs. No-interest or low-interest receivables were discounted.
The accruals were set up in accordance with the principle of prudence at the estimated amounts.
The accruals for severance payments and anniversary bonuses were calculated in accordance with IAS 19 using the projected unit credit method. The calculation method of severance payments was changed in fiscal year 2012/13 compared to the prior year. Until fiscal year 2011/12 the corridor method of IAS 19 had been applied which is no longer allowed after amendments of IAS 19 (2011) from fiscal year 2013/14 on. The Company has prematurely changed the method of calculation already as of 31 March 2013 by adjusting the accrual for severance payments to the amount of the defined benefit obligation.
The effect from the change in the valuation method in the amount of EUR 1,046,778.00 was fully expensed in fiscal year 2012/13.
A discount rate of 3.75 % (prior year: 5.0 %) was used for the calculation of entitlements and a percentage of 2.0 % (prior year: 3.0 %) was assumed for salary increases. Furthermore, the calculation was based on the earliest possible retirement age in accordance with the transitional statutory provisions and the mortality tables Pagler & Pagler AVÖ 2008-P (prior year: AVÖ 2008-P).
In accordance with the principle of prudence, accounts payable were valued at the amount repayable.
B. Comments on balance sheet items
A s s e t s
Fixed assets
Movements in fixed assets:
| Acquisition/Production cost | Accumulated | Net book value | Amortization/ | Write-ups | |||||
|---|---|---|---|---|---|---|---|---|---|
| Balance | Additions | Balance | amortization/ | Balance | Balance | depreciation | of current | ||
| 1/4/2012 | Disposals | 31/3/2013 | depreciation | 31/3/2013 | 31/3/2012 | current year | fiscal year | ||
| EUR | EUR | EUR | EUR | EUR | EUR | EUR | EUR | EUR | |
| 1. Industrial property and similar rights and assets, Intangible assets I. |
|||||||||
| and licenses in such rights and assets | 7,560,421.53 | 3,122,375.51 | 3,344.40 | 10,679,452.64 | 7,198,736.53 | 3,480,716.11 | 1,145,178.82 | 786,838.22 | 0.00 |
| Prepayments and construction in process 2. |
0.00 | 3,108,966.18 | 0.00 | 3,108,966.18 | 0.00 | 3,108,966.18 | 0.00 | 0.00 | 0.00 |
| 7,560,421.53 | 6,231,341.69 | 3,344.40 | 13,788,418.82 | 7,198,736.53 | 6,589,682.29 | 1,145,178.82 | 786,838.22 | 0.00 | |
| Tangible assets II. |
|||||||||
| 1. Investments in leasehold buildings | 4,010,267.87 | 142,015.22 | 0.00 | 4,152,283.09 | 1,865,954.36 | 2,286,328.73 | 2,526,118.27 | 381,804.76 | 0.00 |
| Technical equipment and machinery 2. |
1,640,968.84 | 389,482.09 | 11,022.73 | 2,019,428.20 | 1,340,608.16 | 678,820.04 | 519,134.59 | 228,688.54 | 0.00 |
| Other equipment, factory and office 3. |
|||||||||
| equipment | 5,289,213.30 | 493,933.89 | 54,042.05 | 5,729,105.14 | 3,534,946.45 | 2,194,158.69 | 2,302,866.20 | 596,189.19 | 0.00 |
| Prepayments and construction in process 4. |
0.00 | 185,137.56 | 0.00 | 185,137.56 | 0.00 | 185,137.56 | 0.00 | 0.00 | 0.00 |
| 10,940,450.01 | 1,210,568.76 | 65,064.78 | 12,085,953.99 | 6,741,508.97 | 5,344,445.02 | 5,348,119.06 | 1,206,682.49 | 0.00 | |
| III. Financial assets | |||||||||
| Shares in affiliated companies 1. |
67,554,449.45 | 724,337.80 | 520,712.36 | 67,758,074.89 | 7,015,258.49 | 60,742,816.40 | 62,498,362.93 | 2,936,333.33 | 456,449.00 |
| Participating interests 2. |
17,187,516.64 | 491.94 | 0.00 | 17,188,008.58 | 0.00 | 17,188,008.58 | 17,187,516.64 | 0.00 | 0.00 |
| Securities 3. |
10,004,356.99 | 0.00 | 4,999,937.00 | 5,004,419.99 | 494,957.69 | 4,509,462.30 | 8,217,157.69 | 0.00 | 398,651.61 |
| 94,746,323.08 | 724,829.74 | 5,520,649.36 | 89,950,503.46 | 7,510,216.18 | 82,440,287.28 | 87,903,037.26 | 2,936,333.33 | 855,100.61 | |
| 113,247,194.62 | 8,166,740.19 | 5,589,058.54 | 115,824,876.27 | 21,450,461.68 | 94,374,414.59 | 94,396,335.14 | 4,929,854.04 | 855,100.61 |
Financial obligations of the Company from the use of tangible assets not recognized in the balance sheet amount to:
| In the following | In the next | |||
|---|---|---|---|---|
| fiscal year | 5 fiscal years | |||
| EUR | Prior year EUR '000 |
EUR | Prior year EUR '000 |
|
| Obligations from rental and leasing agreements |
6,481,852.68 | 5,912 | 19,897,393.60 | 16,642 |
| Share | Sharehold ers' equity |
Result of fiscal year |
FN | ||
|---|---|---|---|---|---|
| % | EUR '000 | EUR '000 | |||
| a) | Shares in affiliated companies | ||||
| Kapsch TrafficCom AB, Jönköping, Sweden | 100 | 15,693 | -6,322 | 1) | |
| a) | Kapsch TrafficCom Argentina S.A., Buenos Aires, Argentina | b) 9 |
|||
| 5 | |||||
| 1,137 | -687 | 1) | |||
| Kapsch Components GmbH & Co KG, Vienna | 100 | 3,880 | -198 | 1) | |
| Kapsch Components GmbH, Vienna | 100 | 90 | 7 | 1) | |
| Kapsch TrafficCom B.V., Amsterdam, Netherlands | 100 | 47,028 | -52 | 1) | |
| Kapsch Telematic Services GmbH, Vienna | - | - | - | 2) | |
| Kapsch TrafficCom Construction & Realization spol. s r.o., | |||||
| Prague, Czech Republic | 99 | 1,115 | 474 | 1) | |
| Kapsch TrafficCom S.r.l., Milan, Italy | 100 | -7 | -14 | 1) | |
| Kapsch-Busi S.p.A., Bologna, Italy | 100 | 60 | -122 | 1) | |
| Kapsch Telematic Technologies Bulgaria EAD, Sofia, | |||||
| Bulgaria | 100 | 74 | 14 | 3) | |
| Kapsch TrafficCom Ltd., Manchester, Great Britain | 100 | 448 | 46 | 1) | |
| ArtiBrain Software Entwicklungsgesellschaft mbH, Vienna | 100 | 50 | -4 | 1) | |
| Kapsch TrafficCom Russia OOO, Moscow, Russia | 100 | 4,186 | 4,078 | 3) | |
| Kapsch TrafficCom d.o.o., Ljubljana, Slovenia | 100 | 34 | 6 | 1) | |
| Kapsch TrafficCom France SAS, Paris, France | 30.19 | 365 | 83 | 1) | |
| Electronic Toll Collection (PTY) Ltd., Centurion, South Africa | 25 | 5,439 | 146 | 1) | |
| Kapsch TrafficCom South Africa Holding (Pty) Ltd., Cape | |||||
| Town, South Africa | 100 | 8,368 | 75 | 1) | |
| Kapsch TrafficCom Kazakhstan LLC, Astana, Kazakhstan | c) 15 |
||||
| 100 | 38 | 3) | |||
| Jibeseov GmbH, Vienna | 100 | 742 | 473 | 3) | |
| Transport Telematic Systems LLC, Abu Dhabi, United Arab | |||||
| Emirates | - | - | - | 2) | |
| Kapsch Telematic Services IOOO, Minsk, Belarus | 99 | -241 | -255 | 3) | |
| b) Shares in associates | |||||
| Q-Free ASA, Trondheim, Norway | 19,76 | 75,263 | -2,401 | 3) | |
| GLONASS tolling systems OOO, Moscow, Russia | 20 | - | - | 4) |
1) Figures as of 31 March 2013
2) The protection-of-interest clause pursuant to Section 241 (2) UGB is used.
3) Figures as of 31 December 2012
4) No financial statements have been prepared since the company was established.
Earn-out payments related to the acquisition of Kapsch TrafficCom Argentina S.A., Buenos Aires, Argentina, amounting to EUR 708,882.14 are still outstanding.
Prepayments in the amount of EUR 6,850,000.00 (prior year: EUR 6,850k) relate to prepayments made to affiliated companies.
| 31/3/2013 | 31/3/2012 | |||
|---|---|---|---|---|
| of which with | of which with | |||
| Total | a remaining | Total | a remaining | |
| maturity | maturity | |||
| > 1 year | > 1 year | |||
| EUR | EUR | EUR | EUR | |
| 1. Trade receivables | 8,890,741.39 | 8,429.23 | 4,942,860.08 | 8,429.23 |
| 2. Receivables from affiliated | ||||
| companies | 179,323,222.83 | 78,297,247.13 | 210,918,497.36 | 52,529,677.73 |
| 3. Other assets | 8,199,487.17 | 0.00 | 4,904,063.66 | 0.00 |
| 196,413,451.39 | 78,305,676.36 | 220,765,421.10 | 52,538,106.96 |
Receivables from affiliated companies include trade receivables in the amount of EUR 67,697,061.04 (prior year: EUR 128,806k), loan receivables in the amount of EUR 103,576,438.18 (prior year: EUR 70,998k) and dividend receivables in the amount of EUR 8,049,723.61 (prior year: EUR 11,114k).
Other assets mainly include research bonuses, receivables from fiscal authorities, accrued receivables and other receivables.
Other receivables include income in the amount of EUR 3,659,000.00 (prior year: EUR 4,128k) that will affect cash flow only after the balance sheet date.
Kapsch TrafficCom AG, Vienna, received an investment grant amounting to EUR 750,000.00 from the lessor for the adaptation of the new location at Euro Plaza. The grant is related to the following items of fixed assets:
| Balance 1/4/2012 |
Usage | Balance 31/3/2013 |
|
|---|---|---|---|
| EUR | EUR | EUR | |
| Leasehold improvements | 518,067.23 | 76,680.67 | 441,386.56 |
In the prior year, the amount recognized in the balance sheet did not include actuarial losses amounting to EUR 1,019,596.00.
| Other accruals include the following items: | 31/3/2013 EUR |
31/3/2012 EUR '000 |
|---|---|---|
| Invoices not yet received and outstanding project costs | 23,562,363.24 | 12,268 |
| Personnel accruals (including vacation accruals of | ||
| EUR 2,649,240.11, prior year: EUR 2,695k) | 4,163,163.93 | 4,719 |
| Losses from pending transactions | 0.00 | 429 |
| Warranties and liabilities for construction flaws, | ||
| as well as production and system defects | 369,363.14 | 290 |
| Sundry accruals | 955,600.00 | 686 |
| 29,050,490.31 | 18,392 | |
| 31/3/2013 | 31/3/2012 | |||||
|---|---|---|---|---|---|---|
| remaining | remaining | remaining | remaining | |||
| Total | maturity | maturity | Total | maturity | maturity | |
| > 1 year | > 5 years | > 1 year | > 5 years | |||
| EUR | EUR | EUR | EUR | EUR | EUR | |
| 1. Bonds | 75,000,000.00 | 75,000,000.00 | 0.00 | 75,000,000.00 75,000,000.00 75,000,000.00 | ||
| 2. Bank loans and overdrafts | 36,425,462.56 | 27,472,222.22 | 0.00 | 42,175,462.56 | 0.00 | 0.00 |
| 3. Customer advances | 377.69 | 0.00 | 0.00 | 299,870.90 | 0.00 | 0.00 |
| 4. Trade payables | 8,074,575.31 | 15,027.59 | 0.00 | 4,403,828.87 | 646,526.73 | 0.00 |
| 5. Payables to affiliated companies | 26,344,176.52 | 0.00 | 0.00 | 13,441,526.79 | 0.00 | 0.00 |
| 6. Other payables | 4,298,807.98 | 0.00 | 0.00 | 6,034,533.15 | 0.00 | 0.00 |
| 150,143,400.06 | 102,487,249.81 | 0.00 141,355,222.27 75,646,526.73 75,000,000.00 |
In November 2010, Kapsch TrafficCom AG issued a bond with a volume of EUR 75 million, a maturity of 7 years and a fixed interest rate of 4.25 %.
Payables to affiliated companies include only trade payables with the exception of intercompany charges in the amount of EUR 2,433,954.37 (prior year: EUR 0k).
Other liabilities include expenses in the amount of EUR 3,449,059.21 (prior year: EUR 3,306k) that will affect cash flow only after the balance sheet date.
The export promotion credit recognized in the amount of EUR 1,425,462.56 is secured by bill of exchange.
In connection with the project financing for Belarus with an outstanding loan in the amount of EUR 35 million as of 31 March 2013, the Company received a guarantee by aval from Oesterreichische Kontrollbank Aktiengesellschaft (OeKB) as well as a participation guarantee G4 from OeKB in the amount of up to EUR 61,000,000.00 (maximum amount of the loan commitment). Claims arising from the participation guarantee G4 were assigned as security to the lending banks.
| 31/3/2013 EUR |
31/3/2012 EUR |
|
|---|---|---|
| Assumption of a liability on behalf of subsidiaries | 43,418,183.47 | 10,478,318.75 |
| Bank guarantees for the performance of contracts | ||
| relating to major projects | 44,803,699.27 | 63,401,956.47 |
| Payment guarantees | 5,256,542.01 | 18,784,723.36 |
| Guarantees for project financings | 21,234,266.81 | 11,825,413.89 |
| Other guarantees (security deposits, bid bonds | ||
| and sureties) | 539,118.00 | 482,805.20 |
| 115,251,809.56 | 104,973,217.67 |
In addition, Kapsch TrafficCom AG, Vienna, issued performance bonds for export transactions and projects of Kapsch TrafficCom AB, Jönköping, Sweden, in a contract value of EUR 48 million (prior year: EUR 45.3 million).
At the balance sheet date, the Company has no derivative financial instruments.
| By activity: | 2012/13 EUR |
2011/12 EUR '000 |
|---|---|---|
| Road Solution Projects Services, System Extensions, Components Sales |
47,594,512.11 91,138,427.92 138,732,940.03 |
102,651 77,293 179,944 |
| By region: | 2012/13 EUR |
2011/12 EUR '000 |
| Domestic European Union Foreign |
31,154,723.47 64,863,375.25 42,714,841.31 138,732,940.03 |
29,805 140,930 9,209 179,944 |
| 2012/13 EUR |
2011/12 EUR '000 |
|
|---|---|---|
| Expenses for severance payments | 1,461,388.90 | 326 |
| Payments to staff provision funds | 360,691.95 | 330 |
| 1,822,080.85 | 656 |
Expenses for the auditor amount to EUR 130,471.00 (prior year: EUR 128k) and are broken down as follows:
| 2012/13 EUR |
2011/12 EUR '000 |
|
|---|---|---|
| Audit of the financial statements | 53,150.00 | 53 |
| Other assurance services | 57,150.00 | 58 |
| Other services | 20,171.00 | 17 |
| 130,471.00 | 128 |
The registered share capital of the Company amounts to EUR 13,000,000. The share capital is fully paid in. The total number of shares issued is 13,000,000. The shares are no-par value bearer shares.
Authorized capital amounts to EUR 0.00 as of 31 March 2013 (prior year: EUR 0k).
The Company is a 61.90% subsidiary of KAPSCH-Group Beteiligungs GmbH, Vienna, and thus is related to its shareholder and its affiliated companies as a group company.
DATAX HandelsgmbH, Vienna, prepares the consolidated financial statements for the largest group of companies. These consolidated financial statements are deposited at the Commercial Court Vienna.
The company prepares the consolidated financial statements for the smallest group of companies.
Regarding the disclosure on the legal and economic relations with affiliated companies, the protection clause pursuant to Section 241 (3) UGB was used.
The average number of staff during fiscal year 2012/13 was 515, including 503 salaried employees and 12 waged workers (prior year: 469 salaried employees, 19 waged workers).
In fiscal year 2012/13, total remunerations of the management board amounted to EUR 1,706,827.07 (prior year: EUR 1,821k), expenses for severance payments and pensions for managing directors amounted to EUR 84,718.53 (prior year: EUR 78k).
Remunerations paid to the supervisory board amounted to EUR 28,000.00 (prior year: EUR 8k).
The following persons served on the management and supervisory board:
Georg Kapsch (Chief Executive Officer) Erwin Toplak André Laux
Franz Semmernegg (Chairman) Kari Kapsch (Deputy Chairman) Sabine Kauper
delegated by the Works Council:
Christian Windisch Claudia Rudolf-Misch
Vienna, 27 May 2013
signed:
signed:
Georg Kapsch
signed:
Erwin Toplak
André Laux
The Management Board:
Kapsch TrafficCom is a provider of intelligent transportation systems (ITS) in the application fields of road user charging, urban access and parking, road safety enforcement, commercial vehicle operations, electronic vehicle registration, traffic management and V2X cooperative systems. Kapsch TrafficCom covers with end-to-end solutions the entire value creation chain of its customers as a one-stop shop, from components and subsystems to their integration and operation. The solutions of Kapsch TrafficCom help to provide funding for infrastructure projects, to increase traffic safety, to optimize traffic flow, and to reduce environmental pollution from traffic. The core business is to design, build and operate electronic toll collection systems for multi-lane free-flow traffic. References in 43 countries on all continents make Kapsch TrafficCom a recognized supplier of electronic toll collection worldwide. As part of the Kapsch Group, a family-owned Austrian technology group founded in 1892, Kapsch TrafficCom, headquartered in Vienna, Austria, has subsidiaries and representative offices in 33 countries, has been listed on the Vienna Stock Exchange (KTCG) since 2007, and generated with more than 3,000 employees revenues of EUR 488.9 million in fiscal year 2012/13.
Kapsch TrafficCom AG | Am Europlatz 2 | 1120 Vienna | Austria | www.kapschtraffic.com Investor Relations | Marcus Handl | Phone +43 50 811 1120 | Fax +43 50 811 99 1120 | Email [email protected] Corporate Marketing | Alf Netek | Phone +43 50 811 1700 | Fax +43 50 811 99 1700 | Email [email protected]
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