KILROY Annual Report 2011

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KILROY Annual Report 2011

  1. 1. Casper from KILROY in Copenhagen visiting a school in Karauli, Rajasthan, India Annual Report 2011
  2. 2. Content 2 Key Figures 3 The KILROY Group 5 Report of the Board of Directors 7 KILROY travels 10 KILROY education 11 KILROY group travel 12 Our customers dream of doing KILROY deals 13 something different, studying in a foreign country, achieving self- Jysk Rejsebureau 14 realization, exploring the world and Team Benns 15 sharing their experiences with others. Financial Review 16 We are continuously trying to fulfil Management’s Statement 17 these dreams in our very own Auditors’ Report 18 dedicated way. Accounting Policies 19 Profit & Loss Account 21 We make dreams happen! Balance Sheet 22 Cash Flow Statement 24 Notes to the Accounts 25 Board of Directors and Management 31 Addresses 32 The History and the Legend 33This annual report with financial statements is presented in accordance with the Danish Financial Statements Act. The following is a translation of a Danish original document. The original Danish text shall be governing for all purposes and in case of anydiscrepancy the Danish wording shall be applicable. The Danish worded annual report is subject to approval at the ordinary general meeting on March 28, 2012, and will be filed with the Danish Commerce and Companies Agency.
  3. 3. Key Figures in DKK 3 2011 2010 2009 2008 2007 Profit & Loss Account (DKK million) Turnover 1,437 1,492 1,072 1,122 1,094 EBITDA 42 35 26 22 12 EBIT 36 27 17 11 -4 Net financials 4 4 5 7 6 EBT 40 30 22 18 2 Net profit for the year 29 22 16 13 2 Balance Sheet (DKK million) C ash and bonds 198 184 193 158 162 C urrent assets 265 255 251 222 227 Total assets 291 282 262 238 253 C apital expenditure 4 23 2 4 8 Equity 56 49 40 27 30 C urrent liabilities 220 218 219 204 217 C ash flow from operating activities 35 -1 48 11 39 Key Figures EBITDA - Margin (%) EBITDA / turnover (excl. other operating income) 2.9 2.3 2.4 2.0 1.1 EBIT - Margin (%) EBIT / turnover 2.5 1.8 1.6 0.9 -0.3 Return on assets (%) EBIT / total assets 12.3 9.5 6.7 4.4 -1.5 Return on equity (%) Net profit (excl. extraordinary income/expenses) / average equity 54.6 48.8 48.5 46.4 4.6 Liquidity ratio (%) Current assets / current liabilities 120.4 117.1 114.6 108.6 104.9 Equity ratio (%) Equity (excl. minority interests) / total assets 19.2 17.5 15.3 11.2 11.8 Earnings per share (DKK) Net profit (excl. extraordinary income/expenses) / number of shares 161.2 122.3 90.6 73.3 8.8 C ash flow per share (DKK) Cash flow from operating activities / number of shares 196.3 -4.7 267.9 62.0 219.5 Proposed dividend (DKK million) 20.0 19.0 14.0 17.0 1.5 Average number of full-time employees (FTE) 311 324 280 304 318 Note. Due to the merger of KILROY Denmark and Jysk Rejsebureau per 1 January 2010 the key figures for the years 2010-2011 are not fully comparable to the years 2007-2009 Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  4. 4. Key Figures in EUR 4 2011 2010 2009 2008 2007 Profit & Loss Account (EUR million) Turnover 192.9 200.3 144.0 150.4 146.8 EBITDA 5.6 4.7 3.5 3.0 1.7 EBIT 4.8 3.6 2.3 1.4 -0.5 Net financials 0.6 0.5 0.6 1.0 0.8 EBT 5.4 4.1 3.0 2.4 0.3 Net profit for the year 3.9 2.9 2.2 1.8 0.2 Balance Sheet (EUR million) C ash and bonds 26.6 24.7 25.9 21.3 21.7 C urrent assets 35.7 34.2 33.8 29.7 30.5 Total assets 39.1 37.9 35.3 32.0 33.9 C apital expenditure 0.5 3.1 0.3 0.5 1.1 Equity 7.5 6.6 5.4 3.6 4.0 C urrent liabilities 29.6 29.2 29.5 27.4 29.0 C ash flow from operating activities 4.7 -0.1 6.4 1.5 5.3 Key Figures EBITDA - Margin (%) EBITDA / turnover (excl. other operating income) 2.9 2.3 2.4 2.0 1.1 EBIT - Margin (%) EBIT / turnover 2.5 1.8 1.6 0.9 -0.3 Return on assets (%) EBIT / total assets 12.3 9.5 6.7 4.4 -1.5 Return on equity (%) Net profit (excl. extraordinary income/expenses) / average equity 54.6 48.8 48.5 46.4 4.6 Liquidity ratio (%) Current assets / current liabilities 120.4 117.1 114.6 108.6 104.9 Equity ratio (%) Equity (excl. minority interests) / total assets 19.2 17.5 15.3 11.2 11.8 Earnings per share (EUR) Net profit (excl. extraordinary income/expenses) / number of shares 21.6 16.4 12.2 9.8 1.2 C ash flow per share (EUR) Cash flow from operating activities / number of shares 26.4 -0.6 36.0 8.3 18.9 Proposed dividend (EUR million) 2.7 2.6 1.9 2.3 0.2 Average number of full-time employees (FTE) 311 324 280 304 318 Note. Due to the merger of KILROY Denmark and Jysk Rejsebureau per 1 January 2010 the key figures for the years 2010-2011 are not fully comparable to the years 2007-2009 Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  5. 5. The KILROY Group 5 KILROY International A/S heads a European-based Own Operations group of companies that are leading in the segments in which they operate. The Group operates several brands in six markets, and DK employs nearly 400 people. FI Brands and Competence IS The KILROY Group believes in the importance of strong brands to NL create long-term benefits for our customers and for our company. We NO constantly allocate resources to expand our knowledge of customer SE needs and preferences. This knowledge is integrated into our branding process to create a clear and unique position in the minds of Operations through Cooperation our customers. This brand value is further supported by the high competence of our staff SkiTravelGroup who, together, comprise a platform of specialists that is regarded as an authority by our customers. DK Operation SE The KILROY Group‘s activities are separated into a number of business areas which have full profit & loss responsibility. Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  6. 6. The KILROY Group 6 Legal Structure as per March 28, 2012 Locations Amsterdam  Bergen  Copenhagen  Gothenburg  KILROY International A/S Groningen  Helsinki  Holstebro  Lund  Odense  Oslo  (Denmark) Reykjavik  Stockholm  Trondheim  Turku  Utrecht  Uppsala  Aalborg  Aarhus 57% Horizons A/S (Denmark) 100% OY KILROY Finland AB (Finland) 100% KILROY Iceland ehf. (Iceland) 100% KILROY Norway AS (Norway) 100% KILROY Sweden AB (Sweden) 100% KILROY Netherlands B.V. (Netherlands) 100% KILROY group travel A/S (Denmark) 40% OurWorld A/S (Denmark) 27.6% SkiTravelGroup (Denmark) Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  7. 7. Report of the Board of Directors 7 The KILROY Group delivered a robust Income, the improvement of EBITDA is Distribution result for the year 2011. 45%. The self-service sales channel continues Turnover reached DKK 1,437 million The above-mentioned reclassification also to grow, and this channel is often the compared to DKK 1,492 million in affected the turnover with DKK 51 first step in a chain of sales transactions. 2010. million, which balances the turnover in Sales channels offering personal Operating profit (EBITDA) was DKK 2011 with 2010. counselling are important to travellers 42 million, up from DKK 35 million in The EBITDA development for the KILROY planning long and complicated journeys, 2010. Group is shown in the chart below. and to very young travellers preparing The KILROY Group closed 2011 with their first trip. These channels must a profit before tax (EBT) of DKK 40 develop constantly in order to ensure million, which equals a return on significant and relevant value equity of 55% compared to 49% in propositions. EBITDA 2010. 45 3,5% In regard to physical sales locations, the The financial result of the KILROY 40 EBITDA mDKK number remained unchanged during 3,0% 2011. The Utrecht sales location has Group has met the targets for both 35 EBITDA % sales and profitability, and the Board been relocated and plans have been 2,5% of Directors considers this 30 made to relocate the Lund location. In development satisfactory. 25 2,0% general, larger units have proven essential in developing valued 42 The improved 2011 profitability stems 20 1,5% competences. 35 from several areas of the KILROY Group. 15 However, the Team Benns activities in 26 1,0% 10 22 The unique youth and student ticket Denmark and KILROY in Norway have 12 0,5% For several decades, the KILROY Group shown particularly strong development. 5 has been active in SATA (Student Air The Danish company Horizons, which 0 0,0% Travel Association), which has facilitated holds the merged operations of KILROY 2007 2008 2009 2010 2011 travel opportunities for students and Denmark and Jysk Rejsebureau, has also young people. Originally, this type of developed considerably and is now travel was conducted on the SATA contributing to the Group’s result in member’s own flight ticket stock, and accordance with expectations. settlement was made after the ticket was Market environment The increase in EBITDA must be seen in flown. This is also known as the flown the context that 2010 included a one-off 2011 offered its usual share of external revenue concept. The SATA ticket met income of DKK 6.8 million due to events that impacted the industry. That the demands of a special segment of reclassification of certain business aside, the market environment was students and other young people who segments. Adjusted for this one-off generally positive. often travel for longer periods. Those Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  8. 8. Report of the Board of Directors 8 demands are affordable prices and a high merged company, which has been named KILROY uses mainstream technology in degree of flexibility. SkiTravelGroup. In addition to Højmark all parts of the IT infrastructure. The KILROY Group is unyielding in Rejser and Team Benns Ski, The majority of operational IT costs are keeping these demands in focus. SkiTravelGroup also operates the ski based on long-term maintenance However, the Group is also moving to brands ClickSki.com and Lion Alpin. See agreements ensuring ongoing updates, streamline the business to meet the page 6. and adoption of the newest market suppliers’ demand for seamless In August 2011, KILROY group travel A/S trends and developments. integration. This is pursued via industry divested its 15% stake in the Danish standard settlement procedures ensuring charter company Primo Tours A/S. cost-efficiency both for KILROY and the Organisation airlines. At the end of 2011, KILROY Iceland ehf. The average number of employees was established as a fully-owned The unique youth and student ticket has (fulltime equivalent) in 2011 was 311 subsidiary of KILROY International A/S. been the instrument for serving more compared to 324 in 2010. The main than 10,000 young people while en route driver for the reduction has been the in 2011. This service is primarily provided Brands & business areas transfer of staff to SkiTravelGroup in online from a central service team in During 2011, Team Benns further connection with the merger between Copenhagen. expanded its activities in Norway. Team Benns Ski and Højmark Rejser. Safaritur.no and USAtur.no have been Mergers & acquisitions added to the sub-brand “tur.no.” Once again, there are many reasons to thank our employees for their effort in As of January 1, 2011, KILROY group KILROY also expanded during 2011 by 2011. The continuous improvement of travel A/S (Team Benns) acquired 40% of adding KILROY deals to its business. See profitability has many sources - first and OurWorld A/S – a Danish-based travel more about “deals” on page 14. foremost a vigorous and determined company specialised in guided group organisation! tours. IT & other investments The KILROY Group sees the competences Also from January 1, 2011, KILROY The KILROY Group will continue to make of the sales organisation as imperative Invest A/S was merged into KILROY investments in businesses and assets for our future success. Consequently, International A/S in order to simplify and that facilitate long-term growth and resources are sharply focused on training optimise the business operation. Changes development. and upgrading the organisation. in Danish legislation made this merger Investments in IT remain a focus area. Investments in IT technology and the relevant. Thus an internal project was launched in optimisation of work processes are seen As of May 1, 2011, all skiing activities in 2011 with the purpose of developing a as an integral part of this development in the brand Team Benns Ski were merged new, enhanced selling point. A beta- order to reduce average transaction with Højmark Rejser. In return, KILROY version was released in the beginning of costs, and to save employees’ time and group travel A/S now owns 27.6% of the 2012 and initial test results are positive. focus for creating customer value. Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  9. 9. Report of the Board of Directors 9 The chart below illustrates the understanding and respect among However, KILROY believes that education development in the number of employees cultures. However, the nature of the in a broad context is as important today and sales per employee. business also involves a significant as it was then. amount of air transportation, which To support this vision, it was decided in carries a certain environmental impact. December 2011 to establish the KILROY Employees mDKK The KILROY Group does not have an Foundation. 350 5,0 official written policy for social The purpose of the 4,5 responsibility, consequently concrete foundation is to 300 4,0 results regarding the work with social contribute to the responsibility cannot be presented at this development of 250 3,5 stage. However, the KILROY organisation international 200 3,0 has developed a Code of Conduct that understanding through supporting 2,5 was implemented in 2011 in all educational activities throughout the 150 companies of the KILROY Group. The world. 2,0 purpose of the code is to clarify how all 1,5 Initially, the KILROY Foundation received 100 individuals in the KILROY Group should a gift from KILROY International of DKK 1,0 conduct business matters. Initially, the 1,000,000 (EUR 130,000). 50 main focus has been on local issues, e.g., 0,5 general legislation, gender justice, 0 0,0 working environment and environmental Shareholder information 2007 2008 2009 2010 2011 consciousness. The ownership structures remained Number of FTE Turnover per FTE This work will proceed, and issues such unchanged during 2011. The Danish as illness, supplier evaluation and company, SSTS A/S, holds 100% of the corruption are expected to be included in shares in KILROY International A/S. the code. SSTS A/S currently has no other activities than the ownership of the Corporate Social Responsibility KILROY Foundation KILROY Group. SSTS A/S is owned by a It is a goal of the KILROY Group that Some of the companies that form the group of Nordic investors who have, or employees, suppliers and customers all KILROY Group were founded after World have had, management positions within pursue their best endeavours in a War II in an atmosphere of quest for the Group. manner that supports the neighbouring broader understanding between cultures. community and, to the extent possible, This was pursued through the exchange Expectations for 2012 limits any negative impact on the of students. It may be argued that the The expectation for 2012 is that the environment. globalisation of the world today offers KILROY Group will deliver a result close The KILROY Group business by its very intercultural interaction far beyond what to the result of 2011, save for external nature facilitates and builds the students in the forties dreamed of. events beyond the control of the Group. Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  10. 10. KILROY travels 10 KILROY travels has built a solid reputation as the leading specialist in youth and student travel. We specialise in tailor-made packages. Our sales consultants are experts at putting together complex flight itineraries and round- the-world trips. And just as importantly, they are passionate about travelling. With KILROY, customers get the best of both worlds: expert personal service from our sales consultants, and self-service through the KILROY website. Read more at www.kilroy.eu Sweden D enmark 19% 23% 2011 Turnover per market Finland N orway 14% 31% N etherlands 13% Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  11. 11. KILROY education 11 KILROY education is a strong brand in the student market, offering counselling to students who wish to study abroad. KILROY education works closely with recognised universities throughout the world, offering primarily fulltime degree programmes. Based on 15 years of experience, KILROY education is constantly expanding. We now offer our services in all five Nordic markets, as well as in the Netherlands. KILROY education is also launched in the Icelandic market in 2011 providing online services with local support during the ongoing startup phase. Read more at www.kilroy.eu D enmark 12% Finland Sweden 10% 35% 2011 N etherlands Turnover per 9% market N orway 34% Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  12. 12. KILROY group travel 12 KILROY group travel maintains a dominant position in the Nordic market, specialising in youth and student educational travel. Our market share has grown steadily, and we are both ensuring and building upon our strong position by focusing on concept development and staff competence. The concept, “Go beyond sightseeing,” has been developed in collaboration with our target group, the teachers. The concept is to provide them with educational material to be used both before and during their study trip, enabling them to save time on preparation and strengthen the educational content in the order to justify the costs. Read more at www.kilroygroups.com Sweden 8% D enmark 38% N orway 2011 32% Turnover per market Finland 22% Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  13. 13. KILROY deals 13 KILROY deals is a new brand being launched across the KILROY markets offering discounts relevant for students and youth in their daily life. KILROY deals is a development of the ISIC card (International Student Identity Card), which KILROY has represented across the Nordic countries for more than 40 years. ISIC is supported by UNESCO, has over 4 million card holders and gives access to over 40,000 benefits worldwide. Read more soon at kilroy.euKey Figures The KILROY Report of the Board of KILROY Jysk Team Benns Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board and Addresses 13 The History and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  14. 14. Jysk Rejsebureau 14 Jysk Rejsebureau has been tailoring tours for the adventurous traveller for more than 25 years. Our sales consultants are experienced travellers themselves, and they focus on giving customers the opportunity to experience areas that are often found only where the asphalt ends and the roads turn into trails. We love to compose trips with a high content of “feeling the world” – trips that are unique in experience yet affordable. Read more at www.jr.dk D enmark 100% 2011 Turnover per market Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  15. 15. Team Benns 15 Team Benns is a Danish travel agency specializing in a number of unique concepts which all have a solid and profitable market position. With a starting point in group travel, TEAM BENNS has expanded its product portfolio to include skiing, safaris, cruises, escorted tours and comprehensive destination programs in USA/Canada and Australia/New Zealand, aimed at the +50 segments. A number of these product lines have also been launched in Norway under the umbrella brand, “tur.no.” Read more at www.team-benns.com and www.australiatur.no / usatur.no / safaritur.no / gruppetur.no D enmark 95% 2011 Turnover per market N orway 5% Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  16. 16. Financial Review 16 KILROY International A/S’ net liquid assets in excess of those required for Events in 2012 result in 2011 is DKK 25.4 million, normal operations, and they shall not accrue No material events have occurred after the debt locally or make other financial compared with DKK 21.6 million arrangements/-agreements. balance sheet date, which affect the in 2010. assessment of the Annual Report 2011. The financial risk of doing business in Auditing Shareholders’ equity multiple countries and currencies is managed according to established policies to ensure KPMG is sole auditor. The share capital remains unchanged at DKK that currency exposure is minimized to the 17.8 million. Free reserves including proposed extent possible. SSTS A/S Annual Report dividend total DKK 38.1 million. Total Group shareholders’ equity is DKK 55.9 million at the KILROY International’s treasury function The Annual Report of KILROY International end of the year. controls and hedges the consolidated foreign A/S is included in the Annual Report of SSTS exchange exposure. A/S. Dividends and dividend policy Established procedures for reporting are in The Annual Report of SSTS A/S can be As ordinary dividend to be decided at the place, as are limits for managing currency obtained from Annual General Meeting, the Board positions. recommends a payment of DKK 20.0 million. SSTS A/S Knabrostræde 8 These policies ensure that financial Future dividends will also be proposed with DK-1210 Copenhagen K instruments are used to limit risks. consideration to the KILROY Group’s Subsidiaries operate mainly in their own local expansion plans, continued consolidation and currencies. liquidity. In cases where the subsidiaries have foreign Financial management exchange exposure, they hedge their The KILROY Group placement policy allows exposure via the KILROY Group’s corporate placement in portfolio agreements with treasury function. weighted average duration of 1-3 years and liquid assets in the short-term money market Investments and in publicly traded securities and mortgage Investments in technology are a high priority backed bonds with a relatively short average and is considered as one of the key elements maturity. for long term sustainability. It is the policy of the KILROY Group that the In the last decade KILROY has invested liquidity ratio always exceeds 100 in order to substantial amounts in software and ensure that all short-term liabilities can be hardware. Consequently, our IT platform and paid immediately. supporting systems are up to date, flexible It is also a policy that subsidiaries do not hold and scalable. Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  17. 17. Management’s Statement 17 Statement by the Board of It is our opinion that the consolidated financial the development in the Groups and the Directors and Management statements and the parent company financial Companys operations and financial matters statements give a true and fair view of the and the results of the Groups and the Groups and the Companys financial position Companys operations and financial position. Today, the Board of Directors have discussed at December 31, 2011 and of the results of We recommend that the annual report be and approved the annual report of KILROY the Groups and the Companys operations approved at the annual general meeting. International A/S for the financial year and cash flows for the financial year January 1 January 1 – December 31, 2011. – December 31, 2011. The annual report has been prepared in Further, in our opinion, the report of the accordance with the Danish Financial Board of Directors gives a fair assessment of Statements Act. Copenhagen, March 28, 2012 Board of Management Claus H. Hejlesen Managing Director Board of Directors Arnar Thorisson Tapio Kiiskinen Sigurdur Kiernan Claus H. Hejlesen Robert Doeleman Chairman Vice Chairman (elected by staff) Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  18. 18. Independent Auditor’s Report 18 To the shareholders of KILROY Auditors responsibility We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our International A/S Our responsibility is to express an opinion on the opinion. consolidated financial statements and the parent Independent auditors report on the company financial statements based on our audit. We Our audit has not resulted in any qualification. consolidated financial statements conducted our audit in accordance with International Opinion and the parent company financial Standards on Auditing and additional requirements In our opinion, the consolidated financial statements under Danish audit regulation. This requires that we statements and the parent company financial statements give a comply with ethical requirements and plan and We have audited the consolidated financial perform the audit to obtain reasonable assurance as true and fair view of the Groups and the parent statements and the parent company financial to whether the consolidated financial statements and companys financial position at 31 December 2011 statements of KILROY International A/S for the the parent company financial statements are free and of the results of the Groups and the parent financial year 1 January – 31 December 2011. The from material misstatement. companys operations and consolidated cash flows for consolidated financial statements and the parent the financial year 1 January – 31 December 2011 in An audit involves performing procedures to obtain accordance with the Danish Financial Statements Act. company financial statements comprise accounting audit evidence about the amounts and disclosures in policies, income statement, balance sheet, cash flow statement and notes for the Group as well as for the the consolidated financial statements and the parent Statement on the Managements company financial statements. The procedures review parent company. The consolidated financial selected depend on the auditors judgement, statements and the parent company financial Pursuant to the Danish Financial Statements Act, we including the assessment of the risks of material statements are prepared in accordance with the have read the Managements review. We have not misstatement of the consolidated financial Danish Financial Statements Act. performed any further procedures in addition to the statements and the parent company financial audit of the consolidated financial statements and the Managements responsibility for the statements, whether due to fraud or error. In making parent company financial statements. On this basis, consolidated financial statements those risk assessments, the auditors consider internal control relevant to the Companys it is our opinion that the information provided in the and the parent company financial preparation of consolidated financial statements and Managements review is consistent with the statements parent company financial statements that give a true consolidated financial statements and the parent and fair view in order to design audit procedures that company financial statements. Management is responsible for the preparation of consolidated financial statements and parent are appropriate in the circumstances, but not for the company financial statements that give a true and purpose of expressing an opinion on the effectiveness fair view in accordance with the Danish Financial of the Companys internal control. An audit also Statements Act and for such internal control that includes evaluating the appropriateness of accounting Management determines is necessary to enable the policies used and the reasonableness of accounting preparation of consolidated financial statements and estimates made by Management, as well as parent company financial statements that are free evaluating the overall presentation of the from material misstatement, whether due to fraud or consolidated financial statements and the parent error. company financial statements. Copenhagen, March 28, 2012 KPMG Statsautoriseret Revisionspartnerselskab Sven Carlsen Per Lund State Authorised Public Accountant State Authorised Public Accountant Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend
  19. 19. Accounting Policies 19 General Tax The Annual Report for 2011 for KILROY from the value of the net assets, the difference is, KILROY International A/S is jointly taxed with International A/S is presented in accordance with to the extent possible, allocated to the assets or Danish subsidiaries and the parent company SSTS the provisions of the Danish Financial Statements liabilities that have a higher or lower value. In A/S. Subsidiaries are included/excluded in the joint Act for accounting class large-C companies. addition, provisions are made for the expenses taxation at the same time, as they are The Annual Report has been prepared using the incurred at the time of purchase. included/excluded in the consolidation. same accounting policies as last year. Goodwill in connection to acquisitions is capitalised The current Danish corporation tax is allocated and amortised over a maximum 20-year period. among the jointly taxed Danish companies in Consolidated Accounts proportion to their taxable income (full absorption Newly acquired or established companies are The consolidated accounts include the annual with refunds for tax losses). included in the consolidated accounts from the date accounts of the parent company; KILROY when control was gained. Tax for the year comprises current tax, joint International A/S, and all subsidiaries that the taxation and changes in deferred tax for the year parent company controls directly or indirectly. Divested companies are included up to the date of including adjustments to tax rates. The tax expense disposal. relating to the profit/loss for the year is recognised The consolidated accounts are prepared by adding Other financial assets includes investments in non- in the income statement, and the tax expense items of a similar nature in the accounts of KILROY controlled companies. relating to changes directly recognised in equity is International A/S and its subsidiaries. recognised directly in equity. Subsidiary accounts that are included in the Deferred tax is provided under the liability method consolidated accounts are prepared in accordance Profit and Loss Account and covers all temporary differences between with the accounting policies of the parent company. accounting and tax values of the assets and Turnover Profit and loss statements of foreign subsidiaries are liabilities. Turnover includes the year’s sales of travel products converted into Danish kroner (DKK) using the and services. Deferred tax is furthermore provided for re-taxation average exchange rates for the year. Balance sheet of tax deductible losses realised in non-Danish items are converted at the exchange rate at the end Revenues from individual oriented products are associated companies, if the re-taxation is expected of the year. booked at the time of invoicing, regardless of to be realised by the associated companies’ departure date. departure from the Danish joint taxation scheme. Exchange rate adjustments of the equity of foreign subsidiaries at the beginning of the year, and Revenues from group travel products are booked in The tax value of tax loss carry-forwards will be set exchange rate adjustments of the profit and loss the accounting period that coincides with the off against deferred tax liabilities to the extent that accounts from average rates to year-end rates, are departure date of the trip. the tax losses and other tax assets are expected to posted against the Group shareholders’ equity. In Cost of products sold be utilised in the future taxable income. Deferred the consolidation of the accounts, intercompany tax is calculated according to applicable tax laws income and expenses, intercompany accounts, and Cost of products contains invoiced and accrued cost and according to the expected tax rate. intercompany profits and losses are eliminated. The of travel related products, services and financial parent company’s share in a subsidiary is calculated arrangements. as its share of the subsidiary’s net assets. Result from shares in subsidiaries Upon acquisition of a subsidiary, the share of the Net profits or losses in subsidiaries contain the net assets is calculated according to the Group’s proportionate share of net profits or losses in the accounting policies. If the purchase price deviates subsidiaries. Report of The History The KILROY Jysk Financial Mgmt.s Auditors’ Accounting Profit & Loss Balance Cash Flow Notes to the Board andKey Figures the Board of KILROY Team Benns Addresses and the Group Rejsebureau Review Statement Report Policies Statement Sheet Statement Accounts Management Directors Legend

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