APC 2002 Annual Report Download - page 56

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9 - Consolidated Financial Statements
Consolidated statement of income
Consolidated sales totaled  9,061 million at December 31,
2002, down 7.8% from the year before at current scope of
consolidation and exchange rates.
The decline came to 5.2% at constant scope of consolidation
and exchange rates. The currency effect had a negative
impact of 309 million, corresponding to 3.1% of sales, and
was attributable to the euro’s rise against the dollar and other
currencies, notably in the second half of the year. The
decrease in sales from low and medium voltage electrical
distribution and from industrial control and automation was in
line with the Company’s overall performance.
A breakdown by operating division gives a more detailed
picture of total sales. All changes described below are at
constant scope of consolidation and exchange rates, unless
otherwise specified.
In the European Operating Division, sales declined 6.1%
year-on-year to 4.64 billion, with mixed trends among the
member countries.
- Sales in Spain and Portugal continued to expand, by 1.8%,
thanks to strong growth in electrical distribution driven by the
vibrant building, energy and infrastructure markets. This was
partially offset by a decrease in industrial control and
automation sales.
- Sales growth also remained positive in Central and Eastern
Europe and the CIS at 0.8%. Business recovered in the
second half in Central Europe and Greece after a noticeable
decline in the first six months of the year. The CIS, Romania
and Bulgaria achieved high growth rates. Generally speaking,
both electrical distribution and industrial control were on a
good trend.
- The “Nobis” zone (Scandinavia/Benelux) recorded a 2.8%
decrease in sales due primarily to a downturn in the industrial
and commercial buildings market. Scandinavia weathered the
general slowdown better thanks to final low voltage (Lexel)
and the strength of this business’ main outlet, the residential
market.
- Sales in France declined 8.8% as demand weakened in all
markets except residential buildings. Business was also
impacted by reduced investments by national electricity utility
EDF in the electrical distribution and energy markets.
- In Italy, the UK and Germany, sales were down by around
9% to 15%. German sales in particular were also affected by
the closure of the Gülstein medium voltage plant and the
May & Stevens panelmaking business. In all three countries,
the decline in electrical distribution sales was particularly
noticeable in industrial and commercial buildings. The
manufacturing recession and reduced machine building
resulting from lower capital spending hurt sales in industrial
control and automation.
In the North American Operating Division, comprising the
US, Canada and Mexico, sales were down 9.8% to 2.60
billion. Sales decreased in the US and Mexico but were
stable on the whole in Canada.
The slowdown in capital spending drove a similar trend in low
voltage electrical distribution and industrial control and
automation, where sales contracted by 8% and 9%,
respectively. The medium voltage business recorded an even
larger decline, as power distributors held off on investments
and Schneider Electric implemented a more selective sales
policy.
Sales in the International Operating Division rose 4.5% to
 1.83 billion. The Division’s main zones all recorded growth
during the year.
- Greater China, comprising the People’s Republic, Hong Kong
and Taiwan, enjoyed sustained growth of 8.5% and
accounted for 30% of Division sales. Sales of industrial
control and automation and medium voltage equipment
increased considerably, lifted by the region’s ongoing drive to
develop capital investment and infrastructure. Low voltage
sales also increased, but at a more modest pace.
- Sales in the Pacific region jumped 14.3% as sustained
investment boosted demand for both industrial control and
automation and electrical distribution products.
- Latin American sales rose 0.4% from the year before despite
continuing economic difficulties in Argentina, Colombia and
Venezuela. Growth was strong in Brazil. As in other
developing economies, industrial control and automation and
medium voltage led the expansion, with sales up 12% in
both segments thanks to high investment.