Financial Statements Discontinued Operation
| Service |
Other Topics
Financial Statements
as PDF file
more...
On 17 March 2008, TUI AG announced the decision by the Executive Board and the Supervisory Board to separate container shipping from the Group. In line with that decision and the provisions of IFRS 5, the container shipping sector was already carried as a discontinued operation in the previous interim report as at 31 March 2008.
The discontinued operation comprises the container shipping activities and the interests in the container terminals in Altenwerder and Montreal, Canada. The cruise sector, previously managed in the shipping division, will be retained by the TUI Group and was located to tourism at the beginning of the financial year. The two administrative buildings owned by the Group and leased by container shipping (Ballindamm and Rosenstraße, Hamburg) were not included as part of the discontinued operation in accordance with IFRS 5.
Following the separation of container shipping, the TUI Group will exclusively operate in tourism, its core business sector.
Result from the discontinued container shipping operation
Items of the profit and loss statement of the discontinued operation
|
€ million |
Q2 2008 |
Q2 2007 restated |
H1 2008 |
Container shipping H1 2007 restated |
|---|---|---|---|---|
| Turnover | 1,510.1 | 1,472.5 | 2,961.3 | 2,896.2 |
| Cost of sales | 1,331.2 | 1,452.7 | 2,762.1 | 2,888.2 |
| Administrative expenses | 34.0 | 40.8 | 64.2 | 88.8 |
| Other income/other expenses | 2.6 | + 30.5 | + 8.0 | + 225.5 |
| Financial income | 3.9 | 2.7 | 7.7 | 6.1 |
| Financial expenses | 6.9 | 2.5 | 13.6 | 8.6 |
| Share of results of joint ventures and associates | – | + 3.2 | 5.6 | + 5.1 |
| Earnings before taxes on income | 144.5 | 12.9 | 142.7 | 147.3 |
| Taxes on income | - 7.2 | 17.4 | 2.5 | 49.4 |
| of which deferred taxes | - 8.2 | 15.5 | 0.6 | 45.0 |
| Earnings after taxes on income (Earnings from discontinued operation) | 151.7 | - 4.5 | 140.2 | 97.9 |
Due to the weakening of the US dollar exchange rate against the euro, turnover by the discontinued container shipping operation only rose slightly year-on-year in the first half of 2008 despite a slight increase in transport volumes and a considerable rise in freight rates in US dollars.
In accordance with IFRS 5, fixed assets (carried as cost of sales) have no longer been depreciated since 31 March 2008. As a result, earnings in the current quarter rose by € 65.8 million. At the same time, the participations held by container shipping were no longer measured at equity. If the participations had been measured at equity in the second quarter, earnings would have been € 7.3 million higher.
The other income shown for the current financial year mainly resulted from the divestment of older shipping containers. Earnings for the first half of 2007 had comprised one-off gains from the divestment of the minority interest in Germanischer Lloyd AG and the assets and liabilities of the Canadian Montreal Gateway Terminals totalling € 192.8 million in ‘Other income’. Due to purchase price adjustments, this resulted in a total gain of € 200.5 million in the 2007 financial year.
After adjustment of earnings, in particular adjustment for this one-off income from divestments made in the previous year but also the follow-up effects of IFRS 5 as from the second quarter 2008, operating earnings for 2007 were substantially exceeded due to turnover growth and cost reductions.
Assets and liabilities of the discontinued operation
|
€ million |
30 June 2008 |
Container shipping 31 Mar 2008 |
|---|---|---|
| Non-current assets | 2,927.8 | 2,833.9 |
| Current assets | 958.2 | 919.5 |
| Assets held for sale | 3,886.0 | 3,753.4 |
| Non-current provisions and liabilities | 844.5 | 665.2 |
| Current provisions and liabilities | 953.1 | 894.7 |
| Liabilities related to assets held for sale | 1,797.6 | 1,559.9 |
Current assets held for sale included the cash and cash equivalents of container shipping of € 101.3 million as at 30 June 2008. The financial liabilities allocable to container shipping totalled € 558.9 million (including current financial liabilities of € 11.3 million) as at 30 June 2008.
Cash flows from operating, investing and financing activities of the discontinued operation
|
€ million |
Q2 2008 |
Q2 2007 |
H1 2008 |
Container shipping H1 2007 |
|---|---|---|---|---|
| Cash flow from operating activities | + 179.1 | + 75.4 | + 261.7 | + 102.8 |
| Cash flow from investing activities | - 64.4 | - 107.0 | - 189.0 | + 1.2 |
| Cash flow from financing activities | - 115.8 | + 52.1 | - 91.0 | - 103.7 |
| Change in cash and cash equivalents due to exchange rate fluctuations | - 0.2 | - 0.3 | - 8.2 | - 2.0 |
| Change of cash and cash equivalents | - 1.3 | + 20.2 | - 26.5 | - 1.7 |