2013 Annual report - Statement of changes in equity

NOTE 3

BUSINESS AREAS

Ferd's segment reporting complies with IFRS 8. Ferd is an investment company, and the Company's management makes decisions and monitors and evaluates these decisions based on the fair value of the Company's investments and their changes in value. The operating segments are identified on the basis of capital and resource allocation. Ferd is operating the following five business areas:

Ferd Capital is an active and long-term investor in privately owned and listed companies. Ferd Capital has an overall approach to investments in the area going from an expansion phase to mature companies. Those companies controlled by Ferd Capital are consolidated into the consolidated financial statements. Accordingly, the business area reporting in the consolidated financial statements comprises the consolidated results from these companies, together with the value changes and administration costs of the non-consolidated companies. The value of the investments and value changes are included in the company accounts of Ferd AS, where Ferd Capital reports an operating result of MNOK 2 386. The value of Ferd Capital's portfolio constitutes MNOK 10 847 as at 31 December 2013 and MNOK 8 913 as at 31 December 2012 measured at fair value.

Ferd Capital prioritises investments in companies where we have the relevant expertise. The team comprises highly qualified staff with operational experience from finance, strategic consultancy and manufacturing. Ferd Capital manages the Group's long-term active equity investments, the largest investments being:

- Elopak (100 percent stake) is one of the world's leading manufacturers of packing systems for fluid food articles. With an organisation and cooperating partners in more than 40 countries, the company's products are sold and marketed in more than 100 countries on all continents.

- Aibel (49 percent stake) is a leading supplier to the international upstream and gas industry concentrating on the Norwegian shelf. The company is engaged in operating, maintaining and modifying offshore and land based plants, and is also supplying complete production and processing installations.

- TeleComputing (96 percent stake) is a leading supplier of IT services to small and medium-sized enterprises in Norway and Sweden. The company supplies a broad range of netbased applications and customised operating and outsourcing services in addition to system development, customer assistance and other consultancy services.

- Interwell (34 percent stakel) is a preeminent Norwegian supplier of high-tech well tools to the international oil and gas industry. The company's most important market is the Norwegian shelf, but it has in recent years also gained access to several significant markets internationally, both in Europe, the USA and the Middle-East.

- Swix Sport (100 percent stake) is developing, manufacturing and marketing ski wax, ski sticks, accessories and textiles for sporting and active leasure time use under the brands Swix, Ulvang, Toko, Original and Lundhags. The company has extensive operations in Norway as well as abroad through subsidiaries in, i.a., Sweden, USA, Japan and Germany.

- Mestergruppen (92 percent stake) is a prominent actor in the Norwegian building materials market concentrating on the professional part of the market. The company's operations include the sale of building materials and developing land and projects, housing and cottage chains.

- Servi (100 percent stake). Servi develops and manufactures customer specific hydraulics systems, cylinders and vents to the offshore, maritime and land based industries. The company offers a broad range of components within hydraulics, pneumatics and slide bearings in addition to service and maintenance of hydraulics systems.

Ferd Invest is an active investor managing a considerable portfolio of Nordic listed shares. The business area primarily invests in individual shares assumed to have a large potential. The portfolio is measured against a total Nordic index.

Ferd Special Investments (SI) has a wide mandate to make investments, but so far only hedge fund shares in the second-hand market have been purchased. SI makes investments where Ferd assumes there are opportunities within this niche.

Ferd Hedgefond invests in various types of hedge funds managed by hedge fund environments abroad. The business area shall give a satisfactory risk-adjusted return and ensure a diversification of risk for Ferd

Ferd Eiendom is an active property investor responsible for the Group's efforts concerning property. Operations focus on developing, leasing and managing office, warehouse and logistic properties and developing housing property for sale, mainly in the Oslo area. The projects are partly carried out in-house, partly together with selected external cooperating partners. Ferd Eiendom also invests in foreign property funds.

Other areas mainly comprises investments in externally managed private equity funds that do no require much daily follow-up and are monitored by management rather than allocated to a separate business area. Hence, these securities are part of Other areas. The "Small Caps" mandate, comprising individual stakes in listed companies, where the time perspective has a potential for being somewhat longer than for Invest, is also included in Other areas. In addition, Other areas comprises some financial instruments acquired by management to adjust the total risk exposure. Costs to the company's management, staff and internal bank are also included.

Result 2013

Sales income

10 958 333

10 956 742

1 591

Income from financial investments

2 694 153

- 120 834

1 489 658

568 921

196 366

1 013

559 029

Other income

141 334

26 258

114 396

680

Operating income

13 793 820

10 862 166

1 489 658

568 921

196 366

117 000

559 709

Operating expenses excl. depreciation and impairment

10 155 537

9 998 504

18 378

21 367

4 802

33 485

79 001

EBITDA

3 638 283

863 663

1 471 280

547 553

191 564

83 515

480 708

Depreciation and impairment

439 714

437 719

77

92

923

904

Operating profit

3 198 568

425 944

1 471 203

547 553

191 472

82 592

479 804

Income on investments accounted for by the equity method

83 164

29 067

54 097

Profit before finance items and income tax expense

3 281 732

455 011

1 471 203

547 553

191 472

136 689

479 804

Statement of financial position 31 December 2013

Intangible assets

2 276 314

Tangible assets and investment properties

3 743 985

1 748 692

40

350

1 990 754

4 150

Investments accounted for by the equity method

647 167

294 414

352 753

Investments classified as current asset

15 064 922

2 651 290

4 985 020

2 008 553

2 227 204

13 592

3 179 263

Other assets (1)

5 642 951

5 662 475

54 678

340 135

55 812

303 580

- 773 729

Total assets

27 375 338

12 633 185

5 039 738

2 348 688

2 283 366

2 660 679

2 409 684

1) The business area's net drawings on the bank accounts are included here and deducted from the other assets.

NOK 1 000

Ferd AS Group

Ferd Capital

Ferd Invest

Ferd Special Investments

Ferd Hedgefond

Ferd Eiendom

Other areas

Result 2012

Sales income

10 465 326

10 464 382

944

Income from financial investments

3 238 952

1 081 221

654 655

182 447

137 678

- 48 813

1 231 764

Other income

483 836

39 445

444 082

310

Operating income

14 188 115

11 585 048

654 655

182 447

137 678

396 213

1 232 074

Operating expenses excl. depreciation and impairment

9 867 146

9 714 196

23 928

12 852

8 255

39 845

68 069

EBITDA

4 320 968

1 870 851

630 727

169 595

129 422

356 368

1 164 005

Depreciation and impairment

452 849

451 398

77

58

37

368

911

Operating profit

3 868 119

1 419 453

630 650

169 537

129 385

356 000

1 163 094

Income on investments accounted for by the equity method

87 010

56 965

30 045

Profit before finance items and income tax expense

3 955 129

1 476 418

630 650

169 537

129 385

386 044

1 163 094

Statement of financial position 31 December 2012

Intangible assets

1 731 348

Tangible assets and investment properties

3 377 888

1 381 850

117

442

1 991 498

3 981

Investments accounted for by the equity method

599 321

258 732

340 590

Investments classified as current asset

15 439 785

4 140 076

3 473 772

1 480 585

1 607 396

319

4 737 638

Other assets (1)

5 387 701

3 982 241

52 839

291 122

79 027

296 752

685 721

Total assets

26 536 044

11 494 246

3 526 728

1 771 707

1 686 865

2 629 158

5 427 340

1) The business area's net drawings on the bank accounts are included here and deducted from the other assets.