Philips 2006 Annual Report Download - page 222

Philips Annual Report 2006222
I
Long-term debt
range of
interest rates
average
interest rate
amount
outstanding due in 1 year
due after
1 year
due after
5 years
average
remaining
term
(in years)
amount out-
standing 2005
Eurobonds 5.8-7.1 6.0 2,445 − 2,445 − 2.3 2,447
USD bonds 7.2-7.8 7.4 307 − 307 307 14.7 429
USD putable bonds 7.1 7.1 77 − 77 77 18.4 224
Convertible debentures 0.0 0.0 136 136 − − − 155
Intercompany fi nancing 3.2-5.2 3.4 1,625 1,625 − − − 152
Other long-term debt 2.9-13.6 5.2 179 45 134 − 3.5 197
4,769 1,806 2,963 384 4.1 3,604
Corresponding data
previous year 3,604 582 3,022 1,176 5.2
The following amounts of the long-term debt as of December 31,
2006 are due in the next fi ve years:
2007 1,806
2008 1,698
2009 6
2010 125
2011 750
Corresponding amount previous year 4,385
Convertible debentures include Philips personnel debentures. For
more information, please refer to the related note 56 in the IFRS
consolidated fi nancial statements.
J
Stockholders’ equity
Preference shares
The ‘Stichting Preferente Aandelen Philips’ has been granted the right
to acquire preference shares in the Company. Such right has not been
exercised. As a means to protect the Company and its stakeholders
against an unsolicited attempt to (de facto) take over control of the
Company, the General Meeting of Shareholders in 1989 adopted
amendments to the Company’s Articles of Association that allow the
Board of Management and the Supervisory Board to issue (rights to)
preference shares to a third party.
Option rights/restricted shares
The Company has granted stock options on its common shares
and rights to receive common shares in future (see note 33).
Treasury shares
In connection with the Company’s share repurchase programs, Royal
Philips Electronics’ shares which have been repurchased and are held
in treasury for delivery upon exercise of options and convertible
personnel debentures and under, restricted share programs and
employee share purchase programs and, are accounted for as a
reduction of stockholders’ equity. Treasury shares are recorded at
cost, representing the market price on the acquisition date. When
issued, shares are removed from treasury stock on a FIFO basis. In
order to reduce potential dilution effects, a total of 105,919,623
shares were acquired during 2006 at an average market price of EUR
27.38 per share, totaling EUR 2,899 million, and a total of 11,479,410
shares were delivered at an average exercise price of EUR 14.90
totaling EUR 171 million. A total of 35,933,526 shares were held by
Royal Philips Electronics at December 31, 2006 (2005: 114,736,942
shares), acquired at an aggregate cost of EUR 923 million.
In 2006, Philips’ issued share capital was reduced by a total of
173,268,629 shares, which were acquired pursuant to the share
repurchase programs initiated in 2005 and 2006. As of December 31,
2006, the issued share capital of Philips amounts to 1,142,826,763.
Dividend
A dividend of EUR 0.60 per common share will be proposed
to the 2007 Annual General Meeting of Shareholders.
K
Net income
Net income in 2006 amounted to a profi t of EUR 4,664 million
(2005: a profi t of EUR 3,374 million). For the remuneration of past
and present members of both the Board of Management and the
Supervisory Board, please refer to note 34 of the consolidated
fi nancial statements.
L
Employees
The number of persons employed by the Company at year-end
2006 was 10 (2005: 12) and included the members of the Board
of Management and most members of the Group Management
Committee.
M
Obligations not appearing in the balance sheet
General guarantees as defi ned in Book 2, Section 403 of the
Netherlands Civil Code have been given by Royal Philips Electronics
on behalf of several Group companies in the Netherlands. The
liabilities of these companies to third parties and unconsolidated
companies totaled EUR 1,215 million as of year-end 2006 (2005: EUR
1.397 million). Guarantees totaling EUR 262 million (2005: EUR 549
million) have also been given on behalf of other Group companies,
and guarantees totaling EUR 32 million (2005: EUR 45 million) on
behalf of unconsolidated companies and third parties. For additional
information, please refer to note 27.
February 19, 2007
The Supervisory Board
The Board of Management
112 Group fi nancial statements 172 IFRS information 218 Company fi nancial statements
Auditors’ report