NOTES In order to monitor the capital structure, a number of key figures are used. These are presented below. For definitions of the key figures, please refer to note 3. Group 2007 2006 Capital employed 4,388 4,209 financed by Equity 2,961 2,986 Interest bearing debt 1,427 1,223 Other key figures for capital structure Total assets 6,466 6,107 Net interest bearing debt 1,134 1,023 Equity ratio 46 49 Debt/equity ratio 48 41 Net debt/equity ratio 38 34 The Group’s capital employed has increased, mainly owing to a build-up of working capital. The increased need for working capital has been financed by an increase in indebtedness. For a specification of the Group’s interest bearing liabilities, please refer to note 19. NOTE 3. DEFINITIONS OF KEY FIGURES Operating margin Operating earnings divided by net sales. Profit margin Earnings after financial items divided by net sales. Interest cover Earnings after financial items plus interest expense divided by interest expense. Earnings per share Net earnings for the year divided by the average number of shares. Capital employed Total assets less non-interest bearing provisions and liabilities. Turnover of capital employed Net sales divided by average capital employed. Return on capital employed Earnings after financial items plus interest expense divided by average capital employed. Net interest bearing assets Interest bearing assets less interest bearing provisions and liabilities Net interest bearing debt Interest bearing assets less interest bearing provisions and liabilities. Net debt / equity ratio Net interest bearing debt divided by equity. Interest bearing debt Interest bearing provisions and liabilities. Debt / equity ratio Interest bearing provisions and liabilities divided by equity. Equity per share Equity divided by the number of shares. Return on equity Net earnings for the year divided by average equity. Equity ratio Equity divided by total assets. Cash flow from operating activities after tax per share Cash flow from operating activities after tax divided by the average number of shares. Degree of self-financing Cash flow from operating activities after tax divided by gross investments in intangible and tangible fixed assets (excluding company acquisitions) for the year. Operating capital Operating assets less operating liabilities. Operating assets Non-interest bearing assets excluding tax assets, plus intra-Group receivables. Operating liabilities Non-interest bearing provisions and liabilities excluding tax liabilities, plus intra-Group liabilities. NOTE 4. SEGMENT REPORTING AND TYPE OF REVENUE Since January 1 2006, the Group’s operations have been pursued in the following four divisions: Door & Logistics Solutions, Wastewater Technology Solutions, Pulp & Paper Solutions and Residential Garage Doors. These four divisions constitute the basis of the primary segment information. .. Door & Logistics Solutions’ business is total door and docking solutions, particularly in the transport and logistics sector and in retailing. .. Wastewater Technology Solutions targets customers that need wastewater treatment and handling applications. Its solutions include pumps, mixers, aerators, compressors and control and monitoring systems. In addition, the division offers dewatering pump solutions for customers in the construction industry etc. .. Pulp & Paper Solutions concentrates its activities on solutions involving process pumps, mixers, agitators and measuring instruments for customers in the pulp and paper industry. .. Residential Garage Doors’ business embraces garage doors, both standard doors and customized solutions, which are mainly sold via distributors. The Group’s operations by geographical area are accounted for secondarily. 52 CARDO ANNUAL REPORT 2007
