SAS Releases SAS Group’s Annual Report 2011 and Provides New Financial Information
March 15 2012 - 11:08AM
Business Wire
Regulatory News:
The Board of Directors of SAS AB (OSE:SASNOK) has held a meeting
where the annual report for 2011 for SAS Group and the parent
company SAS AB was presented and approved.
The annual report is now available on the Internet,
www.sasgroup.net under Investor Relations/Reports and
presentations/Annual reports, and will be printed and distributed
to shareholders who have notified the Company of their interest to
receive a copy of the annual report.
Strong cash position
In September 2011, SAS launched the new 4Excellence strategy
with the aim of achieving Excellence in four core areas –
Commercial Excellence, Sales Excellence, Operational Excellence and
People Excellence. SAS announced in February 2012 that the plan is
accelerating and that cost and revenue measures corresponding to
SEK 5 billion are being implemented in 2012-2013.The challenging
nature of the prevailing economic climate in combination with the
earnings effect of 4Excellence being realized in the latter part of
2012 mean that the seasonally weak first quarter will also remain
weak in 2012.
However, the first two months of the year have been trading
above plans and SAS cash position is substantially ahead of
plan.
Renegotiation of Credit Facilities
In the light of the Spanair bankruptcy and the current business
environment, SAS has reached an agreement with our banks to ensure
further flexibility in our financing. We have agreed with the banks
participating in our Revolving Credit Facility and Bi-lateral
facilities to amend the covenants scheme to provide further
flexibility. In connection herewith SAS has agreed to provide
certain security to support any future drawings. Based on its
business outlook and strong cash position, SAS currently does not
foresee use of the facilities and they remain an integral part of
SAS strong financial preparedness position.
Proposal to the annual general meeting (AGM) to change financial
year
The Board proposes that §8 of the articles of association be
amended so that the Company’s financial year shall comprise the
period 1 November – 31 October, instead of the calendar year, and
that the current financial year be shortened and thus will comprise
the period 1 January 2012 – 31 October 2012. The purpose of the
change is for the financial year to follow the traffic program
(winter/summer), in order to improve external reporting and
internal governance, and to decrease internal administration. The
resolution is contingent upon a permit from the Swedish Tax Agency.
As a consequence of the change, SAS will apply the expected changed
accounting rules regarding pensions (IAS19) in the financial year
starting 1 November 2013.
For further information, see the full notice for the AGM
available on www.sasgroup.net
Unrecognized actuarial losses increased by SEK 1.8 billion
In June 2011, the IASB (International Accounting Standards
Board) published amendments to IAS 19 Employee Benefits. The
amendments to IAS 19 have not yet been adopted by the EU, but a
decision is expected during spring 2012. Among other features, the
revised IAS 19 no longer permits the deferral of the recognition of
certain actuarial gains and losses (the ”corridor approach” has
been removed). Instead, all actuarial gains and losses are to be
recognized immediately in other comprehensive income. As a result
of the amendments, the accumulative unrecognized actuarial gains
and losses (unrecognized actuarial gains and losses and plan
changes) will be recognized in shareholders’ equity, which will
have a significant negative effect on the Group’s shareholders’
equity. The parent company SAS AB’s recognized shareholders’ equity
will not be affected by this amendment.
Due to a weak stock market development and lowered discount
rates in Sweden and Norway, actuarial gains and losses increased by
approximately SEK 1.8 billion compared with the preceding year. The
proposed amendments will not have any effect on SAS’ cash
position.
SAS discloses this information pursuant to the Swedish
Securities Market Act and/or the Swedish Financial Instruments
Trading Act. The information was provided for publication on 15
March 2012, at 4.00 pm CET.
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