8. Retained Earnings
Dividends
For 2007, a dividend of EUR 1.00 per outstanding share is proposed by the Executive Board. The dividend for 2006 of TEUR 38,690, which is equal to EUR 0.75 per share, was proposed by the Executive Board and was approved at the 100th Annual General Meeting of Shareholders on March 29, 2007. The dividend was paid to the shareholders on April 6, 2007.
On February 19, 2008, the Executive Board authorized the consolidated financial statements for the year ended December 31, 2007 according to IFRS. On February 16, 2007, the Executive Board authorized submission of the consolidated financial statements for the year ended December 31, 2006 according to IFRS to its Supervisory Board. The Supervisory Board is made up solely of members not employed within the Group and representatives of employees. The consolidated financial statements were presented to the Supervisory Board and subsequently to the General Meeting of Shareholders.
Currency translation adjustment
Equity and shareholder loans in foreign currency are not hedged against currency risks because the investments are considered to be permanent and the conversion to the reporting currency is not planned. Exceptions are made for planned disposal of investments or planned repayments of shareholder loans.
Additional capital disclosures
Andritz is committed to a strong financial profile, characterized by a conservative capital structure that gives excellent financial flexibility.
As of December 31, 2007 and 2006, equity and total assets of the Company were as follows:
| (in TEUR) | 2007 | 2006* | ||
| Total equity | 481,575 | 414,540 | ||
| Equity ratio | 19.2% | 17.4% | ||
| Total assets | 2,507,527 | 2,386,066 | ||
Equity disclosure (Download size 14 KB)
*restated
Andritz is not subject to any statutory capital requirements. Commitments exist to sell or otherwise issue common shares in connection with established share-based payment plans. In recent years, commitments from share-based payment have primarily been satisfied through buy-back of the Company’s shares (see Note 10).
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while maximizing the return to shareholders through the optimization of the debt and equity balance. Two bonds were issued in the past to safeguard the financial stability, and also to build the fundament for further growth of the Andritz Group. The capital structure of the Group consists of debt, which includes the borrowings, of cash and cash equivalents and equity attributable to equity holders of the parent, comprising share capital, capital reserves and retained earnings.
The capital structure is reviewed on an ongoing basis. As a part of this review, the cost of capital and the risks associated with each class of capital are considered. Based on this, the Group will balance its overall capital structure through the payment of dividends, new share issues and share buy-backs as well as the issue of new debt or the redemption of existing debt.
The Group’s overall strategy remains unchanged from 2006.