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Annual Report 2000
we create value for our shareholders.
We use our expertise to create transport-relate
of commercial transport solutions. In each of
d’s leading provider
V l A l R t 2000 l

Table of contents

  • Page 1
    Annual Report 2000 w e c r e a t e v a l u e f o r o u r s h a r e h o l d e r s. We u s e o u r e x p e r t i s e t o c r e a t e t r a n s p o r t - r e l a t e d's leading provider of c o m m e r c i a l t r a n s p o r t s o l u t i o n s. I n e a c h o f

  • Page 2
    ...The Volvo Group in 2000 The business environment Financial performance Financial position Cash flow statement Trucks Buses Construction Equipment Marine and Industrial Power Systems Aero Financial Services Research and development Environmental impact Volvo's use of information technology Volvo and...

  • Page 3
    ... financial items, SEK M Net income, SEK M Income per share excluding items affecting comparability and gains on sales of shares, SEK Operating margin, % Return on shareholders' equity, excluding items affecting comparability and gains on sales of shares, % Dividend per share, SEK Number of employees...

  • Page 4
    ... complete system solutions in cooperation with Volvo Mobility Services. Volvo Buses has grown rapidly through acquisitions and has production in Europe, North and South America and Asia. Sales increased by 17% Operating income amounted to SEK 440 M Launch of a global product platform for coaches and...

  • Page 5
    ... engines and space rockets, as well as marine and land-based gas turbines. Services, such as maintenance and leasing, constitute an increasingly greater part of operations. Financial Services The Financial Services business area was established during the year to coordinate Group customer financing...

  • Page 6
    ... new medium-heavy truck in Europe, a new series of articulated haulers, new diesel engines for marine and industrial use, and a new coach built on the new platform for our large buses. In terms of earnings, Marine and Industrial Power Systems, Financial Services, Construction Equipment and Aero were...

  • Page 7
    ... has the main part of its operations within the truck business, was successful in limiting credit losses in North America and is today our fastest-growing business area. Construction Equipment continues to show good earnings capacity despite a weaker demand in North America. Aero, which continues to...

  • Page 8
    ...Internet will further increase price and market transparency, thus fueling the competetive environment. Information technology can be used to extend and customize the customer offering. The need for efficiency improvements and economies of scale is driving development in all parts of the value chain...

  • Page 9
    ... use of web-based solutions to reduce lead times and costs in the supply chain, and industry restructuring are key strategies in the emerging business environment. These are the driving forces behind the consolidation of the industry. Volvo acquires Mack and Renault V.I. Volvo takes an active part...

  • Page 10
    ...production costs can be reduced. The company's product program and unique brand identity will be further developed and in the markets, accordingly, the three strong brand names, Mack, Renault and Volvo, will be preserved, and continue to act as three competing companies. Volvo Global Trucks operates...

  • Page 11
    ... operates in Sweden, France, North America and South America with a total of approximately 8,500 employees. Powertrain will supply the entire Volvo Group with common solutions Volvo Southern Europe* United Kingdom Central Europe North America South America Renault Volvo Mack Nordic â- Heavy...

  • Page 12
    ... of commercial transport solutions â-² The Volvo Group has developed a number of value-added products and services building on the strength of the world-class products offered. All business areas have developed and offer transport-related services which enhance and support customer operations and...

  • Page 13
    ...over an economic cycle. The average operating margin for the Volvo Group during 1996 to 2000 was 4.4 percent per year. Return on equity Over time, the after-tax return on shareholders' equity should more than compensate for inflation as well as for industrial and financial risk. The objective is to...

  • Page 14
    ...on customer satisfaction. The Volvo Group's core values in the new structure The Volvo brand implicitly guarantees that quality, safety and environmental care form part of every business offer within the Volvo Group. Therefore, all companies within the Volvo Group should develop their operations to...

  • Page 15
    ... complement the Volvo Ocean Race, Volvo also invests in the future of the sport through sponsorship of the Volvo World Youth Sailing Championship. Volvo in sponsoring Sponsorship has been an integral part of Volvo for almost 40 years. In order to communicate an identical message across a number of...

  • Page 16
    ... shares were transferred to Renault. 2 Series A shares carry one vote each 3 Series B shares carry one tenth vote each Exchange listings of Volvo shares, location and year Stockholm 1935 Shareholders in focus During 2000, AB Volvo repurchased own shares through an offer to the shareholders...

  • Page 17
    ... to Volvo's shareholders. The repurchased shares were transferred to Renault on January 2, 2001 as partial payment for the shares in Mack and Renault V.I. On February 1, 2001, the Board of Directors of AB Volvo decided to acquire a maximum of 10% of the Company's shares on the OM Stockholm Exchange...

  • Page 18
    ...of the Volvo Group's structure in recent years has placed major demands on its employees' willingness to change. In order to strengthen and unify the global company, a development program The Volvo Way, started in 1999. It describes Volvo's values and corporate culture and how managers and employees...

  • Page 19
    ... a tendency for an increasing number of persons from countries other than Sweden to be assigned to Volvo organizations outside their home countries. This will further develop and strengthen the Volvo Group's already multicultural organization. Global Profit Sharing The year 2000 was the first for...

  • Page 20
    ...were transferred to Renault on January 2, 2001 as partial payment for the shares of Renault V.I. (see note 21, page 65). An eventful year August September October Volvo acquires an interest in Mitsubishi Fuso Truck and Bus Company At the end of July, 2000, Volvo and Mitsubishi signed a contract...

  • Page 21
    ... were reflected in transportation markets. The U.S. total market for heavy trucks turned around ahead of the business cycle in part due to a large supply of used vehicles and high fuel prices. In Europe, however, truck market expansion continued at a brisk pace ending the year at record size...

  • Page 22
    ... change pertains to 2000/1999. Operating margin1 % 1998 1999 2000 Trucks Buses Construction Equipment Marine and Industrial Power Systems Aero Financial Services Volvo Group excl Cars Cars Total 4.8 2.7 7.9 1.9 6.1 8.2 4.7 3.7 4.3 5.2 1.5 9.1 5.5 5.9 11.3 5.4 - 5.4 2.3 2.6 8.0 7.3 5.8 14...

  • Page 23
    ...sale of a company in Construction Equipment, as well as the reversals of reserves of approximately SEK 240 M for customer-financing operations. The Volvo Group's operating margin for the year amounted to 4.7% (5.4). Operating net flow per currency, excluding divested operations SEK M 1998 1999 2000...

  • Page 24
    ... and the revaluation of balance sheet items in foreign currencies had a negative impact of SEK 90 M. Trucks Buses Construction Equipment Marine and Industrial Power Systems Aero Financial Services Other and eliminations Operating income excluding Cars Cars Operating income 1 Items affecting...

  • Page 25
    ... net financial assets SEK billion December 31, 19991 Cash flow from operating activities Net investments in fixed assets and leasing assets Operating cash flow, excluding Financial Services Acquisition of shares in Scania Other acquired subsidiaries and shares 2 Dividend to AB Volvo's shareholders...

  • Page 26
    ...in North America and Western Europe. Acquisitions and divestments Acquisitions and divestments of subsidiaries and other business units in 2000 had no net impact on the cash flow, while in 1999 mainly the sale of Volvo Cars resulted in a positive cash flow of SEK 31.0 billion. Investments in shares...

  • Page 27
    ... Customer finance receivables, net Operating cash flow Investments in shares, net Loans to external parties, net Acquired and divested operations, net Cash flow after net investments Increase in loans Repurchase of own shares Dividends paid to AB Volvo's shareholders Other Change in liquid funds...

  • Page 28
    TH E VOLVO G ROU P YEAR 2000 Trucks Transport planning software such as Dynafleet 2.0, is used to fully utilize a fleet of vehicles. 26

  • Page 29
    ... with service and insurance agreements. Leasing contracts giving the customer a fixed price per kilometer, apart from fuel and driver costs, are also common. Transport planning equipment such as Dynafleet 2.0, developed by Volvo Trucks, represents a growing business. Based on information technology...

  • Page 30
    ... MAN bought the British truck producer ERF (100%) and the Polish truck company Star (100%). Volkswagen acquired 18% of Scania AB and AB Volvo acquired 100% of Renault V.I. and Mack. Largest markets Volvo heavy trucks registrations 1999 2000 Trucks Market share, % 1999 2000 United States France...

  • Page 31
    ... strong brand names - Mack, Renault and Volvo. The action program introduced in June, 2000, to improve profitability will be completed during this year. Strategic development The acquisition of Mack and Renault V.I. will support growth, development and competitiveness. Through increased resources...

  • Page 32
    TH E VOLVO G ROU P YEAR 2000 Buses Safety in focus. The new Volvo 8500, with seat belts as standard. 30

  • Page 33
    ... for lower fuel consumption, lower operating costs and more complete offerings, including IT-based solutions for both operational and traffic planning. Sales and market shares Volvo delivered 11,015 buses and bus chassis during 2000, 16% more than in 1999. Volvo Buses' net sales increased to SEK...

  • Page 34
    ...Volvo Buses signed an agreement with Shanghai Automotive Industry Corporation to establish a joint-venture company in China for production and sales of city and commuter buses. The first bus was produced in September 2000. Western Europe Eastern Europe North America South America Asia Other markets...

  • Page 35
    ...countries, mainly via independent dealers. Europe and North America are the largest markets. Net sales per market Construction Equipment SEK M 1998 1999 2000 â-² More than 21,000 machines sold in 2000, a new all-time high for Volvo CE Western Europe Eastern Europe North America South America Asia...

  • Page 36
    TH E VOLVO G ROU P YEAR 2000 CON STR U CTI ON E QU I PM E NT Volvo CE offers on-the-spot and round-the-clock response. 34

  • Page 37
    ... to begin producing construction equipment in Volvo's bus plant in Poland. In addition to the industrial advantages, the venture strengthens the company's presence in the increasingly important markets in Eastern Europe. To date, a small number of articulated haulers have been assembled there. New...

  • Page 38
    TH E VOLVO G ROU P YEAR 2000 Marine and Industrial Power Systems 36

  • Page 39
    ... as well as two 7-liter diesel-powered engines, which will give Volvo Penta access to a new segment in the market. â-² Net sales per market Marine and Industrial Power Systems SEK M 1998 1999 2000 Western Europe Eastern Europe North America South America Asia Other markets Total 2,725 23 1,412...

  • Page 40
    ... of new diesel engines during 2000 and 2001 will increase Volvo Penta's competitiveness within the marine commercial segment. Expansion of the North American business geared to the use of gasoline during the past few years has created an important customer base and an extensive dealer network, which...

  • Page 41
    ... in the business concept "Specialized for Partnership" and the vision of being the "Best Partner." Volvo Aero operates in Sweden, Norway and the U.S. â-² Net sales per market SEK M 1998 1999 Aero 2000 Western Europe Eastern Europe North America South America Asia Other markets Total 4,231...

  • Page 42
    TH E VOLVO AE R O G ROU P YEAR 2000 40

  • Page 43
    ... plants in Trollhättan, Sweden and Kongsberg, Norway both posted all-time records for deliveries of engine components. The company's sales related to military engines increased. Despite difficult aftermarket conditions Volvo Aero Services, formerly the AGES Group, reported higher parts sales...

  • Page 44
    ...the Group's growth and profitability. Volvo's customer-financing operations cover Europe, North America, part of South America and Australia. Customer financing is primarily truck-related, although buses and construction equipment are included to an increasing extent. The range of financing services...

  • Page 45
    ... year of changes in reserves and realized credit losses amounted to SEK 397 M. 1) Excluding divested operations in 1998 Distribution of credit portfolio, net 1 % 1998 1999 2000 Commercial products Operational leasing Financial leasing Installment contracts Dealer financing Other customer credits...

  • Page 46
    ... from Volvo Action Service in the event of unexpected interruptions of operations. Automatic determination of a vehicle's position is effected via the Global Positioning System (GPS), and messages can be handled via wireless Internet links. The program makes it possible to schedule maintenance at...

  • Page 47
    ... of the largest manufacturers of methane-powered city buses, using natural gas or biogas. The Volvo development of DME-powered (dimethyl ether) engines, combines the benefits of renewable sources and low emissions. Fuel cell projects, with demonstrator vehicles and laboratory research, are already...

  • Page 48
    ... Volvo Group's Environmental Policy, has been a high priority since 1995. Suppliers of production material and major dealers are requested to be certified according to ISO 14001, along with their internal environmental management development. As of December 31, 2000, 37 of Volvo's plants and units...

  • Page 49
    ... During 2000, Volvo Technological Development introduced a web-based interactive course in vehicle eletronics designed for Volvo Group engineers worldwide. Efficient traffic management equipment represents a growing business Volvo Penta Partner Network - to order spare parts over the Internet. 47

  • Page 50
    ... finance and control system in the Group, covering transactions, accounting and reporting, is changing from national currencies to the euro early in 2001. The conversions are planned to be completed by the end of the third quarter of 2001, with individual time plans for each business area. The cost...

  • Page 51
    ... section 50 Consolidated income statements 51 Consolidated balance sheets 52 Consolidated cash flow statements 53 Notes to consolidated financial statements 80 Parent Company AB Volvo 92 Proposed disposition of unappropriated earnings 93 Auditors' report for AB Volvo 98 Eleven-year summary 49

  • Page 52
    ...E VOLVO G ROU P Consolidated income statements SEK M 1998 Note 3 1999 2000 Net sales Cost of sales Gross income Research and development expenses Selling expenses Administrative expenses Other operating income and expenses Items affecting comparability Operating income Income from investments in...

  • Page 53
    Consolidated balance sheets SEK M December 31, 1998 December 31, 1999 December 31, 2000 Assets Non-current assets Intangible assets Tangible assets Property, plant and equipment Assets under operating leases Financial fixed assets Shares and participations Long-term customer-financing receivables ...

  • Page 54
    ... assets Customer-financing receivables, net Shares and participations, net Loans to external parties, net Acquired and divested subsidiaries and other business units, net Cash flow after net investments Financing activities Increase in bond loans and other loans Dividend to AB Volvo shareholders...

  • Page 55
    ... The Volvo Group's operations during 2000 were organized in six business areas: Trucks, Buses, Construction Equipment, Marine and Industrial Power Systems, Aero and Financial Services. In addition to the six business areas, there are certain operations, consisting mainly of service companies, that...

  • Page 56
    ...the consolidated balance sheet, the book value of shareholdings in associated companies is affected by Volvo's share of the company's income after tax, reduced by the amortization of goodwill and by the amount of dividends received. Accounting for hedges Loans and other financial instruments used to...

  • Page 57
    ... to Volvo Construction Equipment, Champion Road Machinery, The AGES Group, Prévost, Nova BUS, Mexicana de Autobuses, Volvo Construction Equipment Korea and Volvo Aero Norge are being amortized over 20 years due to the holdings' long-term and strategic importance. Inventories Inventories are stated...

  • Page 58
    ...of the former distributor in South Africa for approximately USD 10 million, including dealerships in South Africa and an assembly plant for trucks and bus chassis in Botswana. The company will run operations within the truck, bus, construction equipment and marine and industrial engines sectors. 56

  • Page 59
    ... the United States and Canada, with production plants in both countries. Goodwill amounting to SEK 0.3 billion, which is being amortized over 20 years, arose in connection with the acquisition. BRS Truck Rental and Contract Hire Ltd In February 1998, Volvo Contract Services, Volvo's sales financing...

  • Page 60
    ... the Volvo Group's balance sheet and cash flow statement in connection with the divestment of subsidiaries and other business units are specified in the following table: 1999 2000 Intangible assets Property, plant and equipment Shares and participations Inventories Current receivables Liquid funds...

  • Page 61
    ... 1998 1999 2000 1998 Dividends received 1999 2000 Bilia AB AB Volvofinans Aviation Lease Finance Xian Silver Bus Corp AVC Intressenter AB Omninova Technology AB Turbec Arrow Truck Sales Petro Stopping Centers Holding LP Other companies Holdings no longer reported as equity method investments Scania...

  • Page 62
    ...and expenses include exchange gains amounting to 52 (372; 164). Note 10 Taxes 1998 1999 2000 Income after financial items was distributed as follows: Sweden Outside Sweden Share of income (loss) in associated companies Total Tax expense was distributed as follows: 1998 1999 2000 7,089 4,070 460...

  • Page 63
    ... Volvo Aero Norge AS (22%) and in The AGES Group, ALP (14%). Through Note Intangible and tangible assets Value in balance sheet 1998 Value in balance sheet 1999 Subsidaries Sales/ acquired and scrapping divested Value in balance sheet 2000 Acquisition costs Goodwill Entrance fees, aircraft engine...

  • Page 64
    ...Petro Stopping Centers Holding LP In 1999, Volvo acquired 28.7% of the truck-stop chain Petro Stopping Centers in the U.S. This expanded service to Volvo's truck customers along the interstate network in the U.S., offering preventative maintenance, spare parts sales, emergency road service and minor...

  • Page 65
    ... Volvo Aero acquired a 5% interest in ELF. Changes in the Volvo Group's holdings of shares and participations: Balance sheet, December 31, preceding year Acquisitions and divestments, net New issue of shares and shareholders' contributions Share of income in associated companies, after tax Dividends...

  • Page 66
    ... excluding Cars, was 3,137. The increase in 2000 and in 1999 was mainly attributable to the North American operations. Note 18 Other short-term receivables 1998 1999 2000 Receivable from Ford Motor Company Accounts receivable Prepaid expenses and accrued income VAT receivables Current income tax...

  • Page 67
    ...and bank accounts 1998 1999 2000 Cash in banks Time deposits in banks Total 8,771 4,285 13,056 4,324 3,989 8,313 5,802 598 6,400 Note Shareholders' equity Series A shares and 30,291,594 Series B shares for SEK 11.8 billion. On January 2, 2001, the repurchased shares were transferred to Renault...

  • Page 68
    ... on loans and futures contracts 2 - Other changes - Balance at December 31, 1998 2,649 Cash dividend Net income Effect of equity method of accounting 1 Transfer between unrestricted and restricted equity Transfers between unrestricted and restricted equity as a result of the sale of Volvo Cars...

  • Page 69
    ... risks using derivative instruments. See also Note 32. 1998 1999 2000 The listing below shows the Group's non-current liabilities in which the largest loans are distributed by currency. Most are issued by Volvo Treasury AB and Volvo Group Finance Europe BV. Information on loan terms Bond loans FRF...

  • Page 70
    ... have been transferred (customer-financing operations), less reduction for recognized credit risks. Tax liability pertains to actual or anticipated actions against the Volvo Group for which provisions are not considered necessary. Legal proceedings In March 1999, an FH 12 Volvo truck was involved...

  • Page 71
    ...). Net investments in customer-financing receivables resulted in 2000 in a negative cash flow of SEK 4.5 billion (7.1). In this respect, liquid funds were reduced by SEK 15.5 billion (14.2) pertaining to new investments in financial leasing contracts and installment contracts. Investments in shares...

  • Page 72
    ... of financial goals. The options are financed by the Company. Profit-sharing payments to employees for 2000, 1999 and 1998 amounted to -, 185 and 160, respectively. In accordance with a resolution adopted at the Annual General Meeting, the fee paid to the Board of Directors is a fixed amount...

  • Page 73
    ... number of employees AB Volvo Sweden Subsidiaries Sweden Western Europe Eastern Europe North America South America Asia Other countries Group total Wages, salaries and other remunerations, Board and SEK M President AB Volvo Sweden 23.7 Subsidiaries Sweden Western Europe Eastern Europe North America...

  • Page 74
    ... to changes in contracted and projected flows of payments (commercial exposure), to payment flows related to loans and investments (financial exposure), and to the translation of assets and liabilities in foreign subsidiaries (equity exposure). The objective of the Volvo Group Currency Policy is to...

  • Page 75
    ... major part of the outstanding contracts have been marked to market. Discounted cash flows have been used in some cases. Interest-rate risks Interest-rate risks relate to the risk that changes in interest-rate levels affect the Group's profit. By matching fixed-interest periods of financial assets...

  • Page 76
    ... methods to calculate the market value of the Group's financial instruments as of December 31, 1998 and 1999 and 2000. In the case of instruments with maturities shorter than three months - such as liquid funds and certain current liabilities as well as certain short-term loans - the book value has...

  • Page 77
    ... costs (E) Leasing (F) Investments in debt and equity securities (G) Items affecting comparability (H) Pensions and other post-employment benefits (I) SPP surplus funds (J) Software development (K) Entrance fees, aircraft engine programs (L) Tax effect of above U.S. GAAP adjustments Net increase...

  • Page 78
    ... of five years. Net income Shareholders' equity 2000 1998 1999 2000 Goodwill Goodwill in accordance with Swedish GAAP, December 31 Items affecting reporting of goodwill: Volvo Trucks with regard to exchange of shares with Renault Acquisition of Volvo Construction Equipment Corporation Net change in...

  • Page 79
    ... benefit plans; that is, the employee is entitled to receive a certain level of pension benefits, usually related to the employee's final salary. In these cases the annual pension cost is calculated based on the current value of future pension payments. In Volvo's consolidated accounts, provisions...

  • Page 80
    ...-benefit plans. Sweden Pension benefits United States Pension benefits 1999 2000 Other benefits 1999 2000 Reconciliation of benefit obligation Benefit obligation at beginning of year Service cost Interest cost Plan amendments Actuarial loss (gain) Acquisitions/divestments, net Foreign-exchange...

  • Page 81
    ... as of December 31, 1998, 1999 and 2000 were 6.75%, 7.5% and 7.5%, respectively. J. SPP surplus funds. In the mid-1990s and later years surpluses arose in the SPP insurance company since the return on the management of ITP pension plan exceeded the growth in pension obligations. As a result of...

  • Page 82
    .... On January 2, 2001 Volvo acquired all the shares of Renault's truck operations - Mack and Renault V.I. - in exchange for 15% of AB Volvo's shares. During 2000, AB Volvo repurchased 10% of the Company's outstanding shares through an offer to repurchase shares held by Volvo's shareholders and, to...

  • Page 83
    Balance sheets SEK M Dec 31, 1998 Dec 31, 1999 Dec 31, 2000 Assets Non-current assets Rights Total intangible assets Property, plant and equipment Total tangible assets Shares and participations in Group companies Long-term receivables with Group companies Other shares and participations Other long...

  • Page 84
    ... Motors Corporation, - (2,343; -). Other investments and sales of shares in non-Group companies are presented in Note 11, pages 85-86. Increase/decrease in loans New loans Amortization Change in loans, net Liquid funds Liquid funds include cash and bank balances and marketable securities in Volvo...

  • Page 85
    ... Holding AB. Group-internal transfers resulted in a net loss of 558, which primarily was attributable to capital loss on the sale of shares in Försäkringsaktiebolaget Volvia 596, and a gain on the sale of Volvo Penta Italia SpA, 35. Income in 1998 included a gain on Group-internal sale of shares...

  • Page 86
    ... and costs for confirmed credit facilities as well as costs of having Volvo shares registered on various stock exchanges. Exchange differences on borrowings and lendings, including forward contracts related to loans, amounted to 3 (60; -306). Since these loans are largely designed to hedge net...

  • Page 87
    ...then accounted for as shares in non-Group companies. Shareholder contributions that increased the book values were made to VFHS Finans AB, 3,460, Volvo Bus Corporation, 1,054, Volvo Holding Sverige AB, 767, Volvo Aero Corporation, 302, Volvo Technology Transfer AB, 50, Volvo Business Services AB, 23...

  • Page 88
    ... Group company Volvo Finance Holding AB. 10% of the participations in Blue Chip Jet HB, with a book value of 22, were sold to Försäkringsaktiebolaget Skandia and Volvo Car Corporation. The remaining participations (40%) were then written down by 28, corresponding to the share of the year's income...

  • Page 89
    ... Volvo's pension obligations at year-end 2000 amounted to 668, which has been secured in part through provisions for pensions and in part through funds in pension foundations. Assets in the Pension Foundation, marked to market, accruing to AB Volvo exceeded pension obligations by 15. The accounting...

  • Page 90
    ...AB VOLVO NOTE S TO F I NANCIAL STATE M E NTS Note 18 Other current liabilities 1998 1999 2000 Tax liabilities Wages, salaries and withholding taxes... to subsidiaries. Guarantees for various credit programs are included in amounts corresponding to the credit limits. These guarantees amount to 130,...

  • Page 91
    ...non-Group companies Shares in associated companies, equity method of accounting AB Volvofinans, Sweden Bilia AB, Sweden 4 Petro Stopping Centers Holding, LP, United States Shanghai Sunwin Bus Corp., China Blue Chip Jet HB, Sweden Arrow Truck Sales, United States Aviation Lease Finance, United States...

  • Page 92
    ...South Korea Volvo Truck Australia Pty Ltd, Australia Volvo India Ltd, India Volvo Bussar AB, Sweden Säffle Karosseri AB, Sweden Carrus Oy, Finland Volvo Busse Deutschland GmbH, Germany Expar Inc, United States Prévost Car Inc, Canada Volvo Bus Asia Pacific (Pte) Ltd, Singapore Registration number...

  • Page 93
    ... Asia (Pte) Ltd, Singapore Volvo Penta Japan Corporation (Kabushiki Kaisha), Japan Volvo Aero AB, Sweden Volvo Aero Engine Services AB, Sweden Volvo Aero Support AB, Sweden Volvo Aero Norge AS, Norway VNA Holding Inc, United States Volvo Trucks North America, Inc, United States Volvo Construction...

  • Page 94
    ... to be appropriated to restricted equity. AB Volvo Retained earnings Net income 2000 Total SEK M 50,994 1,374 52,368 The Board of Directors and the President propose that the above sum be disposed of as follows: SEK M To the shareholders, a dividend of SEK 8.00 per share To be carried forward Total...

  • Page 95
    ... and results of operations in accordance with generally accepted accounting principles in Sweden. We recommend to the general meeting of shareholders that the income statements and balance sheets of the Parent Company and the Group be adopted, that the profit of the Parent Company be dealt with...

  • Page 96
    ...1950. Master of Business Administration. President of Volvo Bus Corporation since January 1999. Member of Group Executive Committee since 1993. Senior Vice President of AB Volvo, responsible for economy and finance, 1993-1998. With Volvo since 1973. Holdings: 1,148 Volvo shares, including 914 Series...

  • Page 97
    ... for economy, finance, strategic matters and business development. President of Volvo Group Finance Sweden, 1994-1998. With Volvo since 1987. Holdings: 1,133 Volvo Series B shares. 28,706 options. Salvatore L Mauro Born 1960. Bachelor of Science in Accounting. President of Volvo Financial Services...

  • Page 98
    ... developing markets, including India and China. Tony Helsham was appointed President of Volvo Construction Equipment and a member of the Volvo Group Executive Committee, effective June 5, 2000. Salvatore L Mauro was appointed President of Volvo Financial Services and a member of the Volvo Group...

  • Page 99
    ... and Board member of Volvo Construction Equipment Customer Support AB. Holdings: 100 Volvo Series B shares. Secretary of the Board Eva Persson Born 1953. Master of Laws. Senior Vice President, AB Volvo. Secretary to AB Volvo's Board since 1997. Auditors Olof Herolf Authorized Public Accountant...

  • Page 100
    ... 1996 1997 1998 1999 2000 Intangible assets Property, plant and equipment Assets under operating leases 2 Shares and participations Inventories Customer financing receivables Interest bearing receivables Other receivables 1 Liquid funds Assets Shareholders' equity Minority interests Provision...

  • Page 101
    ... leasing assets Customer financing receivables, net Shares and participations, net Loans to external parties, net Acquired and divested subsidiaries and other business units, net Cash flow after net investments Increase (decrease) in loans Repurchase of own shares Dividend to AB Volvo shareholders...

  • Page 102
    ... 1997 1998 1999 2000 Gross margin, % 1 Research and development expenses as percentage of net sales 1 Selling expenses as percent of net sales 1 Administration expenses as percentage of net sales 1 Operating margin, % Return on shareholders' equity, % Interest coverage, times Self-financing ratio...

  • Page 103
    ... in AB Volvo, December 31, 2000 1 Number of shares % of Share total votes 2 capital, % 2 (or minus net financial assets and minority share), divided by operating income, before items affecting comparability. 6 Dividend divided by income per share. 7 Shareholders' equity divided by number of shares...

  • Page 104
    ... Group as of July 1995. Net sales for the Construction Equipment business area in the years 1991 through 1995, calculated using the average exchange rate for the US dollar in each year, amounted to 8,273, 7,890, 9,665,12,084 and 13,684. Effective in 1997, the Volvo Group's accounting per market...

  • Page 105
    ...each year, amounted to (193), (436), 502, 1,621 och 1,679. Operating margin % 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 Trucks Buses Construction Equipment 1 Marine and Industrial Power Systems Aero Financial Services Volvo Group excluding divested operations Cars Operating...

  • Page 106
    ... the new Annual Accounts Act. Number of employees at year-end Number 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 Trucks Buses Construction Equipment Marine and Industrial Power Systems Aero Financial Services Other Volvo Group, excluding divested operations Cars Other divested...

  • Page 107
    ...1996 1997 1998 1999 2000 Trucks Buses Construction Equipment Marine and Industrial Power Systems Aero Financial Services Other and corporate capital expenditures Volvo Group 1 Cars Other divested operations Volvo Group total Assets under operating leases 1 Divested operations Volvo Group total...

  • Page 108
    ... Group's accounting per market area reflects geographical definitions based on an ISO standard. The accounting for the years 1991-1996 has been adjusted to conform with the new principle. Environmental performance of Volvo production plants Absolute values related to net sales 1997 1998 1999 2000...

  • Page 109
    ... â-² â-² â-¼ North America â- Volvo Trucks New River Valley â- Volvo Buses St Claire St Eustache Schenectady Roswell Mexico City â- Volvo Construction Equipment South America â- Volvo Trucks Bogotá Lima Curitiba â- Volvo Buses Lima Curitiba â- Volvo Construction * â- Volvo Buses Säffle...

  • Page 110
    ...only for Volvo's business areas, not for the Group as a whole. Return on shareholders' equity Net income divided by average shareholders' equity. Self-financing ratio Cash flow from operating activities (see Cash flow statement) divided by net investments in fixed assets and leasing assets. Share of...

  • Page 111
    ... the 2000 Annual General Meeting: Thomas Halvorsen Bo Eklöf Lars Ramqvist Bengt Hane The National Pension Insurance Fund, Fourth Fund Managing board Försäkringsbolaget SPP Chairman of the Board of AB Volvo Representative for shareholders with smaller holdings William af Sandeberg SEB Investment...

  • Page 112
    AB Volvo (publ) SE-405 08 Göteborg, Sweden Telephone +46-31 66 00 00 AB Volvo, Investor Relations, 635-2504