Cover UK 4 pages 3/06/02 11:54 Page 2 Annual report 2001 · with article 29ter. § 1, sentence 1 of the Royal Decree no. 185 of 9 July 1935. Cover UK 4 pages 3/06/02 11:54 Page 3

Annual report 2001

Groupe Bruxelles Lambert

Cover UK 4 pages 3/06/02 11:54 Page 2

Contents

Management reportKey figures 2GBL organisation chart 4Message to shareholders 5Highlights 6Shareholder information 8Financial report 10Corporate governance 14Investments 23

Total Fina Elf 24Suez 28Bertelsmann 32Imerys 38Rhodia 42

Accounts as at 31 December 2001 47Economic summary 48Adjusted net assets 48Consolidated accounts 55

Glossary 94For further information inside back cover

On 27 March 2002, the Banking and Financial Commission authorised the use of this annual report as areference document for any public offer that may be made by Groupe Bruxelles Lambert until the publication ofits next annual report. This authorisation was granted subject to the terms of Chapter II of Royal Decree no. 185of 9 July 1935 through the dissociated information procedure.Under the terms of this procedure, this annual report must be accompanied by an operational note for it toconstitute a prospectus within the meaning of clause 29 of the said Royal Decree no. 185.This prospectus must be submitted for prior approval to the Banking and Financial Commission in accordancewith article 29ter. § 1, sentence 1 of the Royal Decree no. 185 of 9 July 1935.


GBL’s primary objective is to create value for its shareholders over the medium term.GBL strives to stimulate and promote the growth of a valuable and balanced portfolio of industrial investments,focusing on a small number of first-class companies operatingin a diversified range of sectors in which it is able to exerciseits role as a professional shareholder.

GBL’s dividend policy seeks to achieve a sound balancebetween providing an attractive cash yield to shareholders andachieving sustained growth in the capital value of its shares.

GBL RA 2001 UK-Part 1 3/06/02 11:22 Page 1

2 GBL Key figures

Key figures

Suez 26.3%

Total Fina Elf 40.2%

Bertelsmann 24.3%

Imerys 4.8%

Others 1.2%Net cash 3.2%

Adjusted net assets as at 31 December 2001(EUR 67.77 per GBL share)

Adjusted net assets as at 31 December 2000(EUR 82.00 per GBL share)

RTL Group 35.5%

TotalFinaElf 30.8%

Suez Lyonnaise des Eaux23.5%

Imerys 5.0%Others 4.7%

Net cash 0.5%

0

20

40

60

80

100

120

140

TotalFinaElf Suez RTL Group Imerys Rhodia

January February March April May June July August September October November December

Share price of investments in 2001


Global data (in EUR million) 2001 (1) 2000 (1) 2000 (2) 1999 (2) 1998 (2) 1997 (2)

Consolidated profit (group share)Cash earnings 200.3 147.3 147.3 118.0 113.3 137.3

Mark to market and other non-cash 30.3 (23.3) - - - -

Associated companies (3) (133.6) 58.6 76.3 148.7 90.5 139.0

Eliminations and capital gains 385.6 294.3 291.3 1,011.5 678.2 510.2

Total profit 482.6 476.9 514.9 1,278.2 882.1 786.5

Total distribution (4) 182.6 141.4 141.4 134.4 126.1 126.5

Balance sheet

Assets

Non-current assets 8,489.7 6,126.7 7,059.8 5,547.8 3,531.3 3,657.7

Current assets 920.0 878.5 1,237.0 1,634.2 2,538.5 1,813.4

Liabilities

Shareholders’ equity 8,526.4 5,112.0 6,231.2 4,886.8 3,599.5 2,908.3

Minority interests 0.0 902.3 925.3 1,375.1 1,108.9 1,987.3

Non-current liabilities 789.6 766.6 827.0 511.8 390.2 307.9

Current liabilities 93.7 224.3 313.3 408.3 971.2 267.6

Stock market capitalisation as at 31 December 8,166.6 6,181.3 6,181.3 4,886.4 4,239.6 3,228.8

Year-on-year change (in %) + 32.1 + 26.5 + 26.5 + 15.3 + 31.3 + 35.6

Adjusted net assets as at 31 December 9,373.1 10,016.5 10,016.5 8,360.7 5,854.8 4,598.8

Year-on-year change (in %) - 6.4 + 19.8 + 19.8 + 42.8 + 27.3 + 35.2

(1) Figures stated in accordance with the International Financial Reporting Standards (IFRS), formerly known as IAS(2) Figures stated in accordance with the Belgian accounting legislation(3) This line includes the contribution from the consolidated companies minus the dividends and the amortisation of goodwill(4) Total dividend paid to all shares in issue. The 2001 amount still has to be proposed to the Ordinary General Meeting taking place on 23 April 2002

GBL Key figures 3

Stock market capitalisation(in EUR million)

GBL share price(2/1/97 = 100)

2000

3000

4000

5000

6000

7000

8000

9000

20012000199919981997

3,2

29

4,2

40 4,8

86

6,1

81

8,1

67

75

100

125

150

175

200

225

250

275

300

325

350

375

20012000199919981997


4 GBL Organisation chart

As at 31 December 2001 (% of share capital)

GBL organisation chart

BertelsmannTotalFinaElf ImerysSuez Rhodia

3.3%(6.3%)

25.1%(25.0%)

7.1%(12.5%)

26.3%(20.5%)

5.3%(5.1%)

As at 31 December 2000 (% of share capital)

() % of voting rights

() % of voting rights(1) After exercise of RTL Group options (2.8%) with BNP-Paribas(2) Situation as of 14 January 2001

Electrafina

RTL Group Imerys RhodiaSuez Lyonnaisedes EauxTotal Fina Elf

20.4%(20.4%)

7.3%(12.8%)

3.2%(5.9%) (2)

82.8%(82.8%)

5.3%(5.5%)

26.2%(34.0%)

7.7% (0.0%)

9.3% (1)

(6.5%)

3.8% (0.0%)


GBL Message to shareholders 5

Message to shareholders

Ladies and Gentlemen,

The 2001 financial year bore the effects of the bursting ofthe Internet bubble and the confirmation of the economicslowdown, particularly in the United States, with the eventsof 11 September causing the economic climate to furtherdeteriorate at year end.

GBL went through this difficult period showing greatresistance, its share price progressing by 16.7%, in contrastwith a 18.5% and 20.3% downturn respectively for theEuronext 100 and the CAC40.

While maintaining a very conservative financial structure(zero net debt), GBL achieved a solid performance thanks tothe soundness and diversity of its portfolio and to its lightstructures.

Total Fina Elf and Suez both performed well despite theeconomic crisis, while Bertelsmann proved more sensitive tothe economic environment and particularly to the sharp fallin advertising expenditure at the end of the year. Imeryssucceeded in maintaining its profit for the year in a moredifficult business climate.

GBL accomplished two significant new steps in 2001.Firstly, it exchanged its 29.9% interest in RTL Group for a25.1% interest in Bertelsmann. GBL has consequentlybecome the shareholder of a private family group andassociated itself in the medium-term with the future andstrategic development of this major player in the mediaindustry. This transaction led to renewed interest for the GBL share, with certain investors considering it as a meansof achieving an indirect presence in Bertelsmann.

GBL also merged with its subsidiary Electrafina, taking inthis way a further decisive step towards the creation of asimple and transparent structure. The group is nowcomposed of a single quoted holding company, GBL, whichmanages a select number of shareholdings in majorinternational groups acknowledged as leaders in their fields.

We remain alert to all investment opportunities as they ariseand ready to carry out certain portfolio arbitrages whenjustified. However, we are not in favour of movement for thesake of movement and we remain very selective in ouractions, bearing in mind our desire to maintain a portfoliofocused on a small number of high-quality shareholdingslikely to create in the medium term the value that we seekfor our shareholders.

In addition to the market performance of our share, theimprovement achieved in our cash earnings enables us topropose a gross dividend of EUR 1.32 per share for approvalby the forthcoming Ordinary General Meeting, 10% upcompared with the previous financial year.

Baron Frère


Highlights of 2001

JANUARY 2001

Disposal of the stake in LasmoIn January, the group disposed of its 7.3% interest inLasmo via the counter-bid launched in December 2000 byENI at the price of 200 pence a share. Considering theforeign exchange hedge set in place, the sale of the Lasmoshares generated cash income of EUR 313 million and atotal capital gain of some EUR 89 million.

MARCH - APRIL 2001

Merger by absorption of GBL by ElectrafinaOn 26 April 2001, the Extraordinary General Meetings ofshareholders of Groupe Bruxelles Lambert S.A. andElectrafina, its 82.8% subsidiary, approved the merger ofthe two companies. The operation took place according tothe practical arrangements set out in the merger proposallodged with the Registry of the Brussels Commercial Courton 14 March 2001. After dividing Electrafina’s stock bythree, parity was established at five new Electrafina sharesfor one Groupe Bruxelles Lambert S.A. share. The mergedentity took the name Groupe Bruxelles Lambert, or GBL for short.

The merger which was welcomed by the financial marketsand the shareholders, further simplifies the group’sstructure and further increases its legibility andtransparency.

FEBRUARY - JULY 2001

Exchange of GBL’s 29.9% stake in RTL Group for a25.1% interest in Bertelsmann GBL and Bertelsmann announced on 5 February 2001 theirplans to strengthen their partnership, concluding anagreement whereby GBL would exchange its 29.9% holdingin RTL Group, already 37% owned by Bertelsmann, for a25.1% stake in the latter. The final agreement between thetwo was signed on 30 March 2001. It stipulates, amongother things, that GBL will be entitled to request thatBertelsmann be listed on the stock market by the end of2006 at the latest.

Pending such listing, during a period limited to five years,GBL will collect a preferential annual dividend of at leastEUR 120 million on its 25.1% stake. The exchange tookplace on 2 July 2001 after being approved by the regulatoryauthorities.

JANUARY - DECEMBER 2001

Subscription to PAI Europe III fundDuring the 2001 financial year, GBL undertook to investEUR 40 million in the PAI Europe III fund of which EUR 9.9 million have been liberated during the year.

Launched by Paribas Affaires Industrielles (PAI) for a termof 10 years, PAI Europe III aims a global investmentcapacity of EUR 1.25 billion and operates in WesternEurope, mainly in France, the Benelux, Spain and Italy.While relatively modest in regard of the overall scale of thegroup’s portfolio, this investment opens up a window forGBL onto a business sector in which the group does notintend to develop a direct involvement.

DECEMBER 2001

Investment in Private Equity Partners Europe (PEP), a private mutual fundAt the end of the year, GBL also decided to invest EUR 50 million in PEP, a private equity fund of over EUR 500 million set up by Power Corporation of Canada.This fund aims to focus on investments in medium-sizedcompanies located essentially in French-speaking regionsof Europe, and to produce a high rate of return whilemaintaining a moderate risk profile.

This transaction, which was decided upon in conformitywith article 524 of the Companies Code (see details in thechapter on Corporate Governance, page 16), follows thesame logic as that for PAI. It is a ponctual deal and it doesnot reflect a shift in GBL’s policy towards investing throughfunds external to the group.

6 GBL Highlights

Highlights


GBL Highlights 7

Events occurring after the end of the financial year

JANUARY 2002

EUR 5 million of investment funding for SN AirholdingGBL gave its financial support to the initiative of investors to launch a new airline flying from Brussels. GBL took a EUR 5 million stake in SN Airholding (SN Brussels Airlines,ex-DAT), the investment vehicle set up to acquire the DAT shares.


Financial calendar 2002 - 2003

• 2002 Ordinary General Meeting 23 April 2002

• Publication of quarterly results to

31 March 2002 mid-May 2002

• Payment of coupon no. 2 17 May 2002

• Publication of half-yearly results early September 2002

• Publication of quarterly results to

30 September 2002 early November 2002

• Publication of 2002 results end of March 2003

• 2003 Ordinary General Meeting 22 April 2003

Shareholder structure as at 31 December 2001(in %)

GBL on the Stock ExchangeGBL shares are traded on the Euronext Brussels market andform part of the BEL 20 and Euronext 100 indices, whichreflect the performance of the combined markets of Paris,Amsterdam and Brussels.

The key stock liquidity indicators for the last five years are asfollows:

DividendThe payment for financial year 2001 of a gross dividend ofEUR 1.32 per share, 10% up compared with the previousyear’s dividend of EUR 1.20, will be submitted for approvalto the Ordinary General Meeting on 23 April 2002. Thisequals to:• EUR 0.990 net per share• EUR 1.122 net per share accompanied by a VVPR strip.

The total distribution proposed by the Board of Directorsamounts to EUR 182.6 million given the 138,300,053shares involved.

This net dividend will be payable from 17 May 2002, eitherby cheque or by bank transfer to the registered shareholdersor in cash on presentation of coupon no. 2 detached frombearer shares at branches of Banque Bruxelles Lambert.

8 GBL Shareholder information

Shareholder information

2001 (1) 2000 (2) 1999 (2) 1998 (2) 1997 (2)

Volume traded (in EUR billion) 2.8 2.0 1.3 1.1 0.7

Number of shares traded (in thousand) 46,592 40,220 36,240 31,930 18,760

Average number of shares daily traded 185,625 160,240 143,815 127,730 75,040

Percentage of capital traded on the stock market (in %) 33.7 32.9 29.7 26.1 15.4

48.1%

3.8%48.1%

Pargesa group

Held by GBL

Floating

(1) The 2001 volumes have been adjusted so as not to take into account the shares held by GBL and transferred between GBL and its 100% subsidiaries (see page 12 of this report)(2) These figures have been adjusted to take into account the multiplication by 5 of the number of shares as provided by the merger of 26 April 2001


GBL Shareholder information 9

0

10

20

30

40

50

60

70

80

90

20012000199919981997

35

.67 4

7.9

3

68

.44

82

.00

67

.77

26

.57 34

.71

40

.00 5

0.6

0 59

.05

Adjusted net assets Share price

Per share (1) 2001 (2) 2000 (2) 1999 (3) 1998 (3) 1997 (3)

Consolidated profit (group share, in EUR) (4)

Cash earnings 1.50 1.28 0.97 0.93 1.15

Total 3.62 4.14 10.46 7.26 6.58

Dividends (in EUR)

Gross dividend 1.32 1.20 1.10 1.07 1.04

Net dividend 0.99 0.90 0.83 0.80 0.78

Net VVPR dividend 1.12 1.02 0.94 0.91 0.88

Pay-out ratio (in %)

Dividend / cash earnings 88.0 93.8 113.4 115.1 90.4

Dividend / total profit 36.5 29.0 10.5 14.7 15.8

Share price (in EUR)

As at 31 December 59.05 50.60 40.00 34.71 26.57

Maximum 71.50 62.00 41.60 43.18 30.54

Minimum 44.10 36.60 31.12 25.29 19.93

Annual average 59.31 51.25 34.61 32.86 26.66

Stock exchange ratios (in %)

Dividend / average share price 2.2 2.3 3.2 3.3 3.9

Gross annual return 19.1 29.3 18.3 34.5 36.1

Adjusted net assets

As at 31 December (in EUR) 67.77 82.00 68.44 47.93 35.67

Stock exchange indices

Weighting in BEL 20 (in %) 7.2 6.0 4.4 2.6 2.6

Ranking in BEL 20 6 5 7 13 17

Weighting in Euronext 100 (in %) 0.5 0.3 - - -

Ranking in Euronext 100 52 64 - - -

Number of shares

Number of shares in issue 138,300,053 122,160,125 122,160,125 122,160,125 121,499,700

Weighted average number of shares - - 122,160,125 121,503,295 119,516,000

Number of shares basic 133,174,003 115,100,142 - - -

Number of shares diluted 139,329,396 121,255,535 - - -

(1) Data adjusted after the merger on 26 April 2001: number of shares multiplied by 5(2) Figures stated in accordance with the IFRS(3) Figures stated in accordance with the Belgian accounting legislation(4) Historically, the profit per share was calculated on the basis of the weighted average number of shares. From the 2000 financial year onwards, they are calculated on the basis of

the number of shares basic in accordance with the IFRS

Share price and adjusted net assets (in EUR) Cash earnings and gross dividend (in EUR)

0.0

0.3

0.6

0.9

1.2

1.5

20012000199919981997

1.15

1.

04

0.93

1.07

0.97

1.10

1.28

1.20

1.50

1.32

Cash earnings Gross dividend


First implementation of the IFRSIn the context of globalisation of financial markets, harmo-nisation of European accounting standards and in view of thegrowing interest shown by foreign investors, GBL has opted forthe publication of its consolidated accounts for the 2001 and2000 financial years in accordance with the IFRS (Inter-national Financial Reporting Standards), formerly known asIAS. The IFRS should enable the group’s accounts to meet thegrowing requirements for transparency, comprehensiveness and comparability of financial information.

This new frame of reference has repercussions not only onthe accounting rules but also on the presentation of theresults (new reporting format, calculation of earnings pershare, etc.). For GBL, the essential implications resultingfrom the implementation of these new rules are thefollowing:• a revision of the acquisition cost of interests resulting from

mergers and acquisitions transactions since 1995;• a revaluation to market value, by shareholders’ equity, of

interests such as Suez and Total Fina Elf unconsolidatedand not consolidated by the equity method (firstimplementation of IAS 39 in 2001);

• a deduction of the own shares from shareholders’ equity,since the dividends received on these shares and theprofits on sales may not be recorded as income;

• a separate accounting for derivatives included inconvertible and exchangeable bonds;

• a recording of deferred taxes;• a presentation of the accounts before appropriation of

profit.

The adoption of the IFRS has led to the restatement ofcomparative statements and shareholders’ equity for the 2000financial year as mentioned in the tables below.

Merger of Groupe Bruxelles Lambert S.A. andElectrafinaFrom a legal point of view, the merger of Groupe BruxellesLambert S.A. and Electrafina was carried out through theabsorption of Groupe Bruxelles Lambert S.A. by its 82.8%subsidiary, Electrafina.

In accordance with accounting rules, this transaction shouldbe treated in the consolidated accounts as an acquisition byGBL of 17.2% of Electrafina’s shares in exchange for theissue of new shares.

Consequently, in application of the continuity principle, theconsolidated accounts for 2001 are compared with those ofGBL for the 2000 financial year.Following this same logic and considering the rate of exchangeof 1 share for 5, the number of shares representing the capitalof GBL has been multiplied by 5 and all information mentionedin this report related to the GBL share for the previous finan-cial years has been adjusted to take this fact into account.

For the sake of completeness, it should be noted that themention "divided by 5" appearing in the section of text of theannual report relating to the consolidated accounts refersexclusively to the accounting treatment of the merger trans-action as explained above and does not refer in any way to adivision of the GBL share within the legal meaning of the term.

10 GBL Financial report

Financial report

Shareholders’ equity as at 31 December 2000 in

accordance with Belgian accounting principles 6,231.2

Mergers and acquisitions since 1995 (925.3)

Cancellation of own shares (367.4)

Convertible and exchangeable bonds 10.2

Deferred tax 21.2

Write-back of profit appropriation 141.4

Miscellaneous 0.7

Shareholders’ equity as at 31 December 2000 in accordance with the IFRS 5,112.0

Net profit as at 31 December 2000 in

accordance with Belgian accounting principles 514.9

Mergers and acquisitions since 1995 (7.5)

Profit on own shares (6.9)

Convertible and exchangeable bonds (8.6)

Deferred tax (6.2)

Miscellaneous (8.8)

Net profit as at 31 December 2000 in accordance with the IFRS 476.9


Profit for the year (group share detailed page 51 of thisannual report)GBL recorded a current profit of EUR 68 million in 2001(EUR 0.51 per share basic) and a total net profit of EUR 483 million, compared with EUR 170 million (EUR 1.47 per share basic) and EUR 477 millionrespectively for the previous financial year. These figuresmainly result from significant changes in the scope ofconsolidation of the group following the transactionswhich took place in 2001, i.e.:• The merger of GBL with its subsidiary Electrafina, which

resulted in the integration of 100% of the Electrafinacontribution for the whole 2001 financial year, in contrastto the 81% average included for the 2000 financial year.

• The exchange of GBL’s 29.9% interest in RTL Group for a25.1% interest in Bertelsmann on 2 July 2001. From thisdate, GBL consolidated Bertelsmann instead of RTL Groupusing the equity method.

In particular, the financial impacts of this first integration ofBertelsmann can be summed up as follows:• Recognition of a capital gain on contribution of

EUR 427 million calculated on the basis of a revaluationof 50% of RTL Group shares at a price of EUR 61.70per share (average of the 20 closing prices for RTL Groupshares around the date of signature of the final agreements).

• Recognition of a negative goodwill of EUR 164 million onthe basis of Bertelsmann’s shareholders’ equity as at 2 July 2001 stated in accordance with the IFRS, intendedto cover anticipated future losses at the time the transactionwas concluded.

• Writing-back of the whole negative goodwill to partlycompensate GBL’s share in the second half 2001 result,i.e. a net contribution of EUR – 141.6 million.

The net dividends, up 34% to EUR 141 million (EUR 105 million in 2000), represent essentially GBL’sshare of the dividends paid by Suez and Total Fina Elf.

In addition to the capital gain on the contribution of RTL Group, the total net profit for the 2001 financial yearincluded a capital gain of EUR 89 million resulting fromthe sale of Lasmo and a write-down of EUR 86 million onthe Rhodia interest.

Adjusted net assets (1)

The adjusted net assets of GBL as at 31 December 2001reached EUR 9,373 million (EUR 67.77 per share),compared with EUR 10,017 million (EUR 82.00 per shareafter the division by 5) at the end of 2000.

The value of Bertelsmann in the adjusted net assets of GBLas at 31 December 2001 amounts to EUR 2,276 million(GBL’s share in Bertelsmann IFRS consolidated shareholders’equity).A detailed breakdown of the adjusted net assets is givenon page 48 of this annual report.

Purchase of GBL sharesWith respect to the usual policy of the company, GBL’s (ex-Electrafina) General Meeting authorised the Board ofDirectors of the company to buy and sell a maximum of13,830,005 of the company’s own shares on the stockexchange over a period of 18 months with effect from thedate of the General Meeting (26 April 2001). The countervalue of these purchases and sales cannot be less than thelowest stock price over the past 12 months less 10% andcannot exceed the highest closing price of the preceding 20 trading days plus 10%.

This authorisation also covers purchases and sales realisedby direct subsidiaries of the company.

The Ordinary General Meeting of GBL, to be held on 23 April 2002, will be asked to renew this authorisation to the Board of Directors to buy and sell its own shares atthe same conditions.

GBL Financial report 11

(1) For the sake of clarity, the term "Estimated value" has been replaced by "Adjusted net assets" which better reflects the calculation method employed


• It should be noted that Electrafina held none of its ownshares before the merger.

As at 31 December 2000, Groupe Bruxelles Lambert S.A.,however, held 1,871,946 of its own shares via its directsubsidiaries Brussels Securities (872,019 GBL shares)and Sagerpar (999,927 GBL shares).

At the start of 2001, Brussels Securities bought afurther 10,559 GBL shares, bringing its total amount ofGBL shares to 1,882,505 or 7.7% of the capital.

In March 2001, Groupe Bruxelles Lambert S.A. purchased872,019 shares from its subsidiaries Brussels Securities(622,369 shares) and Sagerpar (249,650 shares) with aview to cancelling them at the time of the merger withElectrafina in April. This purchase, carried out on thestock exchange, was realised at the closing market priceon 13 March 2001 of EUR 305, representing a totalvalue of EUR 266.0 million. Following this transaction, anamount corresponding to the total value of the purchasewas transferred from the distributable reserve to theinalienable reserve for own shares.

• As a consequence of the merger of Groupe BruxellesLambert S.A. and Electrafina, the 872,019 shares werecancelled. The 1,010,486 shares held by the twoGroupe Bruxelles Lambert S.A. subsidiaries wereexchanged for 5,052,430 GBL shares (ex-Electrafina),1,301,045 of which were allocated to BrusselsSecurities and 3,751,385 to Sagerpar.

• When the merger was achieved, the total number ofGBL shares held in the portfolio of GBL (ex-Electrafina)and its direct subsidiaries amounted to 5,078,554,including the 8,708 Electrafina shares (exchanged for26,124 GBL shares after division by 3) held by BrusselsSecurities before 26 April 2001.

Between this last date and 31 December 2001,Brussels Securities acquired 516,793 GBL shares for atotal of EUR 29.2 million and sold 50,107 GBL shares,while Sagerpar sold 235,097. These 285,204 GBLshares were sold at an average price of EUR 66.24. All these transactions were made on the stock exchangewith the exception of the sale of 397 shares, which GBLhad bought from Sagerpar to allocate them subsequentlyto holders of GBL bonds (1998-2003) who had optedfor their conversion.

Taking these movements into account, as at 31 December 2001 GBL held 3.8 % of its own capital, or 5,310,143 GBL shares, 3,516,288 of which were heldvia its subsidiary Sagerpar and the 1,793,855 sharesremaining by Brussels Securities.It should be noted that 4,999,238 of these GBL ownshares are held to cover convertible bonds issued in 1998(due in 2003).

In January and February 2002, Brussels Securities sold94,426 GBL shares on the stock exchange for a totalamount of EUR 5.8 million.

12 GBL Financial report

Purchases and sales of GBL shares from 26 April to 31 December 2001GBL Sagerpar Brussels Total

SecuritiesState as at 26 April 2001 0 3,751,385 1,327,169 5,078,554

Purchases 397 0 516,793 517,190

Sales (397) (235,097) (50,107) (285,601)

State as at 31 December 2001 0 3,516,288 1,793,855 5,310,143


Charitable donationsOur philosophy in respect of charitable donations continuesto focus on donations to three main areas:• Charitable organisations• Scientific research• Culture.

A committee meets regularly to consider the numerousrequests for funds received and each case is consideredindividually on its merits.

A total of EUR 0.8 million was shared among 84 beneficiaries in 2001. The main beneficiaries includedFondation Charles-Albert Frère and Fondation Louvain.

GBL Financial report 13


This chapter details the operating and internal control rulesapplied within the company in accordance with therecommendations of the Brussels Stock Exchange and theBanking and Financial Commission on matters of corporategovernance.

Following the absorption of Groupe Bruxelles Lambert S.A.by Electrafina, Electrafina changed its name to GroupeBruxelles Lambert. The resulting company then decided to adopt the operating and internal control rules and thecorporate governance principles applied until 26 April 2001by Groupe Bruxelles Lambert S.A.

1. Composition of the Board of Directors afterthe Extraordinary General Meeting held on26 April 2001

1.1. Office, main position and term of office of DirectorsChairman and Managing DirectorBaron Frère (1) (2) 1999-2002

Vice-Chairman and DirectorPaul Desmarais (1) 1999-2002Chairman of the Executive Committee of Power Corporationof Canada

Managing DirectorsGérald Frère (1) (2) 1999-2002

Thierry de Rudder (2) 2000-2003

DirectorsJean-Louis Beffa (3) 2001-2004Chairman and General Manager of Compagnie de Saint-Gobain

Victor Delloye (1) 2001-2004Director and Company Secretary of Compagnie Nationale à Portefeuille

André Desmarais (1) 2001-2004Chairman and Joint CEO of Power Corporation of Canada

Paul Desmarais Jr (1) 1999-2002Chairman of the Board and Joint CEO of Power Corporationof Canada

Baron Goossens (3) 2001-2004President and CEO of Belgacom

Aimery Langlois-Meurinne (1) 2001-2004Director and General Manager of Pargesa Holding

Count Maurice Lippens (3) 2001-2004Chairman of Fortis

Michel Plessis-Bélair (1) 2001-2004Vice-Chairman and Head of Financial Services of PowerCorporation of Canada

Gilles Samyn (1) 1999-2002Managing Director of Compagnie Nationale à Portefeuille

Amaury-Daniel de Sèze (4) 2001-2004Chairman of PAI management

Honorary Managing DirectorsCount Jean-Pierre de Launoit (5)

Jacques MoulaertEmile Quevrin

Honorary Directors Léopold Blampain, Jacques de Bruyn, Count Baudouin duChastel de la Howarderie, Charles Despret, Count de Fels, G. Peter Fleck, Jacques-Henri Gougenheim, Baron Lambert,Count Jean-Jacques de Launoit, Philippe van der Plancke,Aldo Vastapane

14 GBL Corporate Governance

Corporate Governance

(1) Director appointed on controlling shareholder’s proposal(2) Director responsible for day-to-day executive affairs(3) Independent director: independent of the company’s management and dominant shareholders, and with no business relationships capable of influencing the independence of his

judgment other than his remuneration and ownership of shares in the company(4) Other(5) Vice-Chairman and Honorary Managing Director


1.2. Rules covering the appointment of Directors andrenewal of term of office

The articles of association specify that there must be atleast three Directors and that they shall be elected by theAnnual General Meeting for a maximum term of three years.

Should a directorship fall vacant, the remaining Directorsmay coopt a Director to fill this office until the next AnnualGeneral Meeting.

Directors are proposed for election to the Annual GeneralMeeting by virtue of their abilities and according to thecompany’s needs. The Board of Directors proposes theirelection on the recommendation of the Nomination andRemuneration Committee.

The company does not have any formal internal rulesgoverning the exercise of the office of Director.

1.3. Age limitsThe Board of Directors has set the maximum age limit forthe office of Director at 62 years for Managing Directors and70 years for other Directors. However, these limits are notapplicable to the offices of Chairman and Vice-Chairman.The Board of Directors is entitled to make exceptions tothese general rules on an individual case basis.

1.4. Statutory appointmentsMr. Guy Dejouany reached the end of his term of office at the end of the Annual General Meeting held on 26 April 2001 to vote on the merger proposal, i.e. beforethe end of the statutory date. He was not nominated for re-election. Messrs Jean-Marie Messier and Didier Pfeifferresigned their Directorships with effect from this same date.

The Annual General Meeting held on 26 April 2001 electedMessrs Jean-Louis Beffa, Victor Delloye, André Desmarais,Baron Goossens, Aimery Langlois-Meurinne, Count MauriceLippens, Michel Plessis-Bélair and Amaury-Daniel de Sèze tothe office of Director for a term of three years.

Baron Frère and Messrs Paul Desmarais, Gérald Frère, Paul Desmarais Jr and Gilles Samyn will reach the end oftheir terms of office at the end of the Ordinary GeneralMeeting to be held on 23 April 2002. It is proposed to re-elect them for a new term of three years.

2. Operation of the Board of Directors

2.1. AuthorityThe Board of Directors determines the company’s strategicobjectives and puts in place the structures and resourcesneeded to achieve these objectives. It organises themanagement, the management-control and the auditing ofthe company and reports to the shareholders. The Board ofDirectors appoints a Chairman and a Vice-Chairman and alsodesignates those responsible for the day-to-day management.The Board of Directors examines internal control reportsand determines any measures which may need to betaken. It is responsible for preparing the accounts.

2.2. Supervision of day-to-day managementThe Board of Directors has appointed three ManagingDirectors, Baron Frère and Messrs Gérald Frère and Thierry de Rudder, who are responsible for the day-to-daymanagement of the company. Each of these performs thismanagement responsibility jointly with one other ManagingDirector. The Managing Directors report regularly to theBoard and the various Committees formed within it on thestate of GBL’s affairs, particularly with respect to changesin shareholdings, the supervision of subsidiaries and thefinancial management of the group.

2.3. Organization and monitoring of subsidiaries’activities

Since the main activity of the company is to hold aportfolio of investments in a small number of majorcompanies, these investments are reviewed in detail ateach Board meeting.

GBL is also represented within statutory bodies of each ofits subsidiaries.

GBL Corporate Governance 15


2.4. Frequency of meetings and decision-makingprocedure

The Board of Directors meets regularly for purposesincluding examining the accounts, preparing for the AnnualGeneral Meeting, adopting the budget, hearing reports fromthe various Board Committees and whenever required by thecompany’s interests.

Prior to the merger of the two companies, the Boards ofDirectors of Groupe Bruxelles Lambert S.A. and Electrafinaeach met on 13 and 22 March 2001. The main purpose ofthese meetings was to prepare the merger operation. On 22 March 2001, both Boards approved the transfer ofRTL Group shares to Bertelsmann in exchange for an interestin this latter company.

Three meetings of the newly-composed Board were held in2001 after the merger had been completed. At its meetingheld on 8 May, the Board adopted the same corporategovernance structures as those existing prior to the mergerwithin Groupe Bruxelles Lambert S.A., i.e. an ExecutiveCommittee, a Nomination and Remuneration Committee andan Audit Committee.

The various Committees submit proposals to the Board onmatters requiring decisions. The rules and regulations forthe Committees formed by the Board of Directors specifiesthat their members may call upon the services of experts toassist them in accomplishing their tasks.

Unless a Board Meeting is convened on matters of urgency,the Directors receive information and documents relating tothe items on the agenda prior to the meeting.

Resolutions are passed by the Board of Directors by a simplemajority vote with the majority of its members being presentor represented. Each Director may mandate another Directorto represent him/her and vote on his/her behalf at a Boardmeeting. Subject to at least half of the Directors beingpresent, Directors may also express their opinions and votein writing. In the event of the votes for and against aproposal being equal, the Chairman of the meeting shallhave the casting vote.

In exceptional cases duly justified by urgency and theinterests of the company, the articles of association allowthat resolutions may be passed by unanimous mutualconsent of the Directors given in writing. The Board usedthis procedure in December 2001, contacting members bycircular to enable it to pass a resolution before the end ofthe year on the investment in the private investment fundlaunched by Power Corporation of Canada (Power) under thename of Private Equity Partners Europe (PEP).

The Board pays particular attention to the existence ofpotential conflicts of interest with a Director or a dominantshareholder, and to the implementation of specificprocedures laid down by articles 523 and 524 of theCompanies Code.

The procedure laid down by article 524 of the CompaniesCode was applied to the resolution on the investment ofEUR 50 million in PEP, the private fund launched by Powerreferred to above.

Power is an indirect shareholder in GBL having a decisive or significant influence on the appointment of the majority of the company’s Directors, on 8 May 2001 the Boarddesignated Count Maurice Lippens, Baron Goossens and Mr. Thierry de Rudder to prepare a report on this proposedinvestment in view of their independence with respect to theproposed transaction. Banque Degroof was also designatedin the capacity of independent expert engaged to assist theseDirectors in the performance of their task.

The report of the College of independent Directors concludedthat:

"Based on these works and the advice of the independentexpert, the independent Directors consider that theproposed investment of EUR 50 million in PEP represents a justifiable interest for the company and his shareholdersand does not involve any preferential direct or indirectremuneration for Power.



The proposed investment gives GBL indirect access to thecapital of medium-sized companies in French-speakingEurope and thus enables it to benefit from the potentialopportunities to be offered by this market, which iscomplementary to GBL’s normal field of operation."

The conclusions of the independent expert’s report were asfollows:

"In conclusion, our analysis of the proposed transactionshows that, without prejudging the advisability for GBL of aninvestment in Private Equity Partners Europe, such aninvestment does not appear to be contrary to the interestsof GBL and his shareholders and does not involve anyspecific benefit which might be granted to Power."

The Statutory Auditor’s report on the company’s annualaccounts include the same descriptions and conclusions asthose of the reports of the independent Directors and theexpert and contains no supplementary observations.

Based on the conclusions of these reports, the Board ofDirectors approved the investment of EUR 50 million in PEP.This resolution, which was passed by circular writting (seeabove), is dated 20 December 2001, the date on which thefinal signature was made on one of the copies of thedocument including the agreement of the Directors.

Other than in situations provided for by law and as specifiedfor the Committees (see above §5), the company has notadopted any specific procedure to enable one or moreDirector to request the advice of an independent expert. A Director may, however, submit such a request forconsideration by the Board.

2.5. RemunerationThe articles of association state that the Annual GeneralMeeting may grant the Directors fees or attendanceallowances, chargeable to the overheads. The Nominationand Remuneration Committee formulates recommendationson this matter (see point 3.2 below).

Details of Directors fees paid in respect of the 2001financial year are given on page 67 of this annual report.

3. Committees formed by the Board ofDirectors

The meeting of the Board of Directors held on 8 May 2001formed various Committees to prepare various matters:

3.1. Executive CommitteeThe Executive Committee is responsible for all matters ofgroup strategy and makes specific recommendations to theBoard of Directors.

Prior to the merger on 26 April 2001, Groupe BruxellesLambert S.A. had an Executive Committee while Electrafinadid not. The Executive Committee of Groupe BruxellesLambert S.A. met twice in 2001 prior to the merger.

Since it was set up within GBL, the Executive Committeehas met once, in September 2001.

Executive Committee members:

Gérald Frère, ChairmanPaul DesmaraisPaul Desmarais JrBaron FrèreMichel Plessis-BélairThierry de RudderGilles SamynAmaury-Daniel de Sèze

3.2. Nomination and Remuneration CommitteeThe Nomination and Remuneration Committee is responsiblefor making recommendations to the Board of Directors onthe appointment of non-executive Directors. It also makesrecommendations to the Board of Directors with respect tothe remuneration to be awarded to Board and Committeemembers, including Managing Directors. It also advises onremuneration policy for the company as a whole, includingemployee profit-sharing plans.At least once each year, it submits a report on its activitiesto the Board for the Board’s approval.Prior to the merger on 26 April 2001, the Groupe BruxellesLambert S.A. Nomination and Remuneration Committeeoperated as a single Committee, authorized to submitproposals for Groupe Bruxelles Lambert S.A. and Electrafina.



This Committee met once in March 2001.

Since it was set up within GBL, the Nomination andRemuneration Committee has met once, in November 2001.

Nomination and Remuneration Committee members:

Baron Goossens, ChairmanMichel Plessis-BélairGilles SamynAmaury-Daniel de Sèze

3.3. Audit CommitteeThe Audit Committee’s role is to support the Board ofDirectors in maintaining internal controls, focusingparticularly on the analysis of:• parent company and consolidated accounts• accounting rules• internal control systems• consultation with external auditors to examine the scope of

their work and the conclusions of their audits• financial information for distribution to shareholders and

third parties.

The Audit Committee’s responsibilities cover GBL and itssubsidiaries.

The Audit Committee’s operation is governed by rules set outby the Board of Directors. In the performance of its respon-sibilities, the Audit Committee is entitled to full access to allcompany information and employees. It may call upon theservices of external specialists and invite them to participate inits meetings if appropriate. The Audit Committee meets atleast twice each year and reports to the Board on its activitiesat least once each year to seek Board approval of its report.

The Audit Committee is composed of non-executive Directors.

Prior to the merger, the Audit Committee also operated asa single Committee for Groupe Bruxelles Lambert S.A.and Electrafina. This Committee met only once prior to 26 April 2001.Since 8 May 2001, the Audit Committee has met three times;the Statutory Auditor was present on all three occasions.

Audit Committee members:

Jean-Louis Beffa, ChairmanMichel Plessis-BélairGilles Samyn

4. Executive managementThe Board of Directors has appointed three ManagingDirectors to take charge of the company’s executivemanagement and to be responsible for representing thecompany with respect to this management.

Following the example of the situation existing within GroupeBruxelles Lambert S.A. prior to the merger, the meeting ofthe Board of Directors held on 8 May 2001 formed aGeneral Management Committee to monitor the company’soperational activities and examine the management actionsto be taken. The General Management Committee meetsvery regularly and is composed of the following members:

Gérald Frère, ChairmanBaron FrèreThierry de RudderPatrick De Vos Esther Jakober Ann Opsomer Olivier Pirotte

The executive management team is composed of thefollowing members:

Financial Services Patrick De VosConsolidation and Budget Yves Désiront

Axelle HenryAccounts André HelboTreasury and Investment Portfolio Marc Desclez

Pascal PeigneuxLegal and tax Ann OpsomerTax Pascal ReynaertsInvestments and Research Esther Jakober

Olivier PirotteMarie Skiba

Human Relations, IT and Michel HucklenbroichAdministration Fabienne Prozenko



5. AuditThe Extraordinary General Meeting of 26 April 2001 appointed the following company as Statutory Auditor for a term ofthree years:

DELOITTE & TOUCHE Reviseurs d'Entreprises SC s.f.d. SCRLRepresented by Mr. Michel Denayer

The Auditor’s fees during the 2001 financial year were EUR 78,150.

6. Profit appropriation and dividend policyThe profit appropriation policy proposed by the Board of Directors aims to maintain a balance between an attractive cashyield to shareholders and to achieve sustained growth in the market value of its share; the total dividend level is supportedby cash earnings.


6.1. Appropriation of profit by Groupe Bruxelles Lambert (parent company accounts)(in EUR thousand) 2001 2000Profit available for appropriation 2,269,708 2,521,995

Profit for the year available for appropriation 1,295,889 333,145

Profit carried forward from previous year 973,819 2,188,850

Profit to be carried forward (2,087,152) (2,497,395)

Profit to be carried forward 2,087,152 2,497,395

Profit to be distributed (182,556) (24,600)

Dividend 182,556 24,600

6.2. DividendTaking into account the profit carried forward for the year of EUR 973,819,032.10, the profit available for appropriation amounts to

EUR 2,269,707,605.64. The Board of Directors will propose the following appropriation to the General Meeting to be held on 23 April 2002:

(in EUR)

Dividend on 138,300,053 shares 182,556,069.96

To be carried forward 2,087,151,535.68

6.3. Dividend per share2001 2000

(in EUR) Gross Net Gross NetPer share 1.32 0.990 1.20 0.900

Per share + VVPR strip 1.32 1.122 1.20 1.020


7. Relationships with dominant shareholdersUnder the terms of an agreement entered into in 1990, the Power and Frère-Bourgeois/CNP groups exercise jointcontrol via the Dutch holding company Parjointco, PargesaHolding S.A., which controlled 48.1% of GBL’s capital as at 31 December 2001. In September 1996, this agreement,which was entered into for an initial term of 11 years, wasextended until 2014. This agreement does not provide forthe setting up of specific shareholder Committees.

8. Employee profit-sharing schemeAt its meeting held on 15 June 1999, the Board ofDirectors of Groupe Bruxelles Lambert S.A. resolved to setup a profit-sharing scheme for employees of the group andDirectors of the company exercising permanent executiveduties within GBL.

In conformity with its general rules and regulations, thisplan has been adjusted to take account of the merger ratio(for further details, see note 22 to the consolidatedaccounts, page 76).

9. General information

9.1. Corporate identity9.1.1. NameGroupe Bruxelles Lambert Groep Brussel Lambertin abbreviated form "GBL"

The French and Dutch registered names may be usedtogether or separately.

9.1.2. Registered officeAvenue Marnix 24, B-1000 Brussels

The registered office may be transferred to any other addressin Belgium upon a decision by the Board of Directors.

9.1.3. Legal form, formation and statutory publicationsSet up on 4 January 1902 in the form of a limited liabilitycompany under Belgian law by deed enacted by MaîtreEdouard Van Halteren, Notary in Brussels, published in theAppendices of the Moniteur Belge of 10 January 1902,reference number 176. The articles of association have beenamended on a number of occasions, the last time being bydeed enacted on 26 April 2001 published in the Appendicesof the Moniteur Belge of 24 May 2001, reference numbersN 20010524-47 and 48.

9.1.4. Company registerThe company is entered in the Brussels Companies Registerunder number 3.902.

9.1.5. TermThe company is formed for an indefinite period.

9.1.6. ObjectivesIn accordance with article 2 of its articles of association, the objectives of the company are:• conduct, on its own behalf or on behalf of third parties,

any real estate, financial and portfolio managementtransactions; to this effect, it may create companies orbodies, acquire shares therein, and conduct any financing,payment, lending, security or deposit operations;

• carry out any studies and provide technical, legal, accounting,financial, commercial, administrative or managementassistance, on behalf of companies or bodies in which itdirectly or indirectly owns shares, or on behalf of third parties;

• provide, on its own behalf or on behalf of third parties,any transport or transit operations.

The company may have an interest, through contribution ormerger, in any companies or bodies already created or to becreated, the object of which might be similar, related orconnected to its own or that might be of such a nature as toconfer any advantage in the pursuit of its corporate objects.



9.1.7. Availability of company documents for publicconsultation

The articles of association may be consulted at the Registryof the Brussels Commercial Court, at the company’sregistered office and on its Website (http://www.gbl.be).The annual accounts are filed with the Banque Nationale deBelgique (Belgian National Bank). Resolutions relating to theappointment and resignation of members of the company’sexecutive bodies are published in the Appendices to theMoniteur Belge.

Financial announcements relating to the company arepublished in the financial press and daily newspapers. Other documents available for public inspection and referredto in the prospectus may be consulted at the company’sregistered office.

The company’s annual report is sent each year to registeredshareholders and to any person having requested a copy;they are available free of charge from the registered office.Annual reports for the last three financial years may also beconsulted on the company’s Website.

9.1.8. ActivitiesGBL is a holding company which holds a limited number ofinvestments in leading companies. GBL supports thedevelopment of these companies and is among their majorshareholders.

9.2. Share capitalThe shareholder structure set out below is based upon thelast declaration received in compliance with clause 1 of theAct of 2 March 1989 relating to the public declaration ofmajor shareholdings.


Pargesa Netherlands B.V.

Rodenrijselaan 23b -

NL-3037 XB Rotterdam

Sagerpar

Avenue Marnix 24, 1000 Brussels

Brussels Securities


Fonds de Pension GBL


Total held by Parjointco and associated companies

30/4/2001

30/4/2001

30/4/2001

30/4/2001

48.23

2.71

0.96

0.01

51.91

66,700,695

3,751,385

1,327,169

7,500

71,786,749

Shareholders Number of shares held % Date of declaration



9.3. Shareholding structure as at 31 December 2001

PARJOINTCO

100%

FRERE BOURGEOISCNP/NPM GROUP

POWER FINANCIALCORPORATION

GBL

BrusselsSecurities Sagerpar

PARGESA HOLDING

100%2.5%1.3%

48.1%

54.7%

50%50%


GBL Investments as at 31 December 2001 23

Total Fina Elf 24

Suez 28

Bertelsmann 32

Imerys 38

Rhodia 42

In the next pages is provided for each operating company:

• a summary of the company’s activities, key events during the year andfinancial results;

• a table of key figures showing consolidated financial and operating data foreach company or an estimate of this;

• a graph showing the evolution of GBL’s percentage holding in capital andvoting rights in its interests. The capital percentage equals to the equityinterest (non fully diluted) held by GBL in the company transitivelycalculated across the various entities. This percentage is significant becauseit reflects the contribution to the group’s result;

• a graph showing company profit record. This figure refers to the group shareof consolidated result after taxes as published in the company’s annualreport.

A glossary giving definitions of key-words used in this annual report is given onpage 94.

Investments as at 31 December 2001


Total Fina ElfTotal Fina Elf is a world-scale oil and gas group and a major player in the chemicals sector, resulting from the successive mergers of Total, PetroFina and Elf Aquitaine


GBL TotalFinaElf 25

Total Fina Elf financial communication: Ladislas PaszkiewiczTel.: +33-1 47.44.58.53 Fax: +33-1 47.44.58.24

ActivitiesTotal Fina Elf is one of the first world’s largest international oil companies. With operations in over 100 countries,Total Fina Elf’s activities cover the entire oil chain, from theupstream (exploration, development and oil and gasproduction) through to downstream (refining and distributionof oil products and international trading of crude oil andproducts). Total Fina Elf is also a major player in thechemicals sector.

Upstream, Total Fina Elf has proven hydrocarbon reserves ofsome 11 billion barrels of oil equivalent, giving the companyalmost 13 years of supplies at the December 2001production rate of 2.4 million barrels per day. With a highlydiversified asset portfolio spread among the OECD zone anddeveloping countries, the group has some of the oil industry’sstrongest growth prospects in both reserves and production,thanks to its interests in major projects with low technicalcosts and in highly promising blocs. Total Fina Elf already hasoperations in the liquefied natural gas (LNG) industry and isexpanding its activities into associated market segments suchas gas distribution or electricity generation.

Downstream, Total Fina Elf is a European leader, with 2.6 million barrels per day of refining capacity and sales of3.2 million barrels per day of refined products excludingtrading activities. The group has interests in 29 refineriesand operates a network of some 17,000 petrol stationsselling under the Total, Fina and Elf brands, with networkmarket shares of 12% in Europe and 20% in Africa.

Total Fina Elf’s chemicals interests, now reorganised underthe aegis of Atofina, are among the European and worldleaders in each of their markets. These include not only thepetrochemicals and long-chain polymers typical of majorintegrated oil companies, but also intermediary products andperformance polymers, plus a speciality products sectorspecialising in processing technologies for rubber andcoating products.

Key events in 2001In 2001, Total Fina Elf not only successfully completed theprocess of integrating the interests arising from the mergerswith PetroFina in 1999 and Elf Aquitaine in 2000, but alsostarted a number of major development projects which areproceeding according to plan. The group has also beenmobilised to cope with the consequences of the seriousexplosion which occurred on 21 September at the AZF plant inToulouse, the causes of which still remain unexplained to date.

UpstreamHydrocarbon production in 2001 was 2.20 million barrels ofoil equivalent per day, 3.4% up compared with 2000.Excluding the effects of sales, the like-for-like rise was 5.3%.This increase in production mainly resulted from the start-up of the Eglin/Franklin projects in the British sector of theNorth Sea and Sincor in Venezuela, plus increasinglystrong production in Norway, Myanmar and Nigeria. Inaddition, recent developments include the start-up ofproduction at the Girassol field in Angola and completionof construction of the upgrader for the Sincor project.The group’s reserves continued to increase in 2001,reaching 11.0 billion barrels of oil equivalent at the end ofthe year. Consolidated subsidiaries achieved an averagereserves renewal rate of 184% between 1999 and 2001, at an estimated reserve renewal cost of USD 3.4 barrels of oil equivalent.In associated downstream areas in the gas and electricitygeneration sectors, the group is continuing its investments(gas pipelines, power stations, etc.) in line with thegeographical expansion of its upstream positions.

DownstreamDownstream, 2001 saw both an acceleration in theachievement of internal programmes (synergies/productivity)and consolidation of the group’s positions as a leading playerin refining and marketing in Europe and Africa. In Europeanrefining, the group’s optimisation programme enabled it tocontinue reducing the break-even point of its refineries toUSD 9 per tonne, while the capacity utilisation rate wasraising from 94% to 96%. Upgrading of the group’srefining assets to future specifications is also under wayand is being achieved through the integrated managementof various sites.


26 GBL TotalFinaElf

In the marketing area, Total Fina Elf strengthened several ofits positions in 2001 through a series of investmentsincluding the acquisition of a motorway service stationnetwork in Italy, the purchase of the joint LPG business fromAir Liquide in France and increased its interests insubsidiaries in Africa and Turkey. The group is alsocontinuing the process of network uniformisation, with all itsservice stations being regrouped under its new brand coloursor the launch of a oil European payment card.

ChemicalsIn the chemicals sector, the year 2001 saw thecentralisation of various functions such as informationsystems and research and development, plus theimplementation of head office restructuring plans.Meanwhile, Atofina continued the disposals programmebegun at the end of 1999 with the sale of a number ofassets from its portfolio. The group is focusing itsinvestments on the development of large industrialpetrochemicals plants and on targeted acquisitions in theintermediary and speciality products sectors.

Total Fina Elf's medium-term strategy remains in line withprevious announcements, i.e. to pursue simultaneous growthand higher productivity. The group is therefore prioritisinggrowth in upstream, maintaining strict investment disciplinein downstream and pursing selective growth in chemicals.

Financial reportIn an economic environment where demand for oil productshas been generally depressed from the peaks reached in2000, the group reported consolidated turnover of EUR 105 billion in 2001, a fall of 8% compared with 2000.The group share of net profit excluding nonrecurring factorswas EUR 7.5 billion in 2001, 2% down compared with2000. This good performance was achieved throughgrowth in hydrocarbon production and the realisation ofsynergies and productivity programmes, which are aheadof their initial objectives.

Taking into account significant share repurchases carriedout by the group in 2001 (39 million shares at a total costof EUR 6.1 billion), net earnings per share excluding non-recurring factors were EUR 10.85 in 2001, equal to therecord level achieved in 2000.

Group share of net profit was EUR 7.7 billion, 11% upcompared with the EUR 6.9 billion achieved in 2000.

Operating profit for the sectors excluding non-recurringfactors fell by 12% to EUR 13.1 billion in 2001, comparedwith EUR 14.9 billion in 2000. Growth and the synergiesand productivity programmes, which are moving aheadcompared to the objectives set for 2003, enabled the groupto compensate partially (by EUR 1.2 billion) for the overallnegative effect of the environment (EUR 3.0 billion) onoperating profit for the sectors in 2001. In particular, the11% fall in current operating profit for the upstream sectorto EUR 9.0 billion in 2001 was attenuated by increasedproduction. Similarly, the group was able to limit the fall incurrent operating profit for the downstream sector to 4%(at EUR 3.0 billion compared with EUR 3.1 billion in2000 by gains achieved through internal programmes.Operating profit for the chemicals sector fell more sharplyby 33% to EUR 1.1 billion, compared with EUR 1.6 billionin 2000. The industry suffered from the effects of a difficulteconomic environment, particularly in the United States,resulting in significantly reduced volumes and margins.

Gross investments of the group rose to EUR 10.6 billion in2001, compared with EUR 8.3 billion in 2000, around 71%of which was in the upstream sector, 11% in the downstreamsector and 15% in the chemicals sector. Disinvestments,calculated at disposal prices, were EUR 7.0 billion in 2001,mainly comprising the sale of Sanofi-Synthélabo shares.Operating cash flow amounted to EUR 12.3 billion in 2001,compared with EUR 13.4 billion in 2000.

A net dividend of EUR 3.80 per share will be recommendedto the Annual General Meeting to be held on 7 May 2002,15% up compared with the previous year. The dividend willbe payable in cash from 17 May 2002. The tax creditapplicable will be calculated in accordance with prevailingtax legislation.

www.totalfinaelf.com


Contribution of Total Fina Elf to GBL adjusted net assets and profit

As at 31 December 2001, the GBL’s economic interest in Total Fina Elf represented some40% of GBL’s adjusted net assets. It amounts to EUR 3,767 million, 22% up compared with31 December 2000 (EUR 3,080 million).The progression was mainly due to GBL’s increased shareholding in the company further tothe merger by absorption with its subsidiary Electrafina, which held the shareholding. GBL’s transitive interest in Total Fina Elf amounts to 3.3% at 31 December 2001, comparedwith 2.7% on 31 December 2000. Total Fina Elf’s contribution to GBL’s current profitcorresponds to its share of the net dividend received from the oil group, which rose to EUR 66 million in 2001, compared with EUR 40 million in 2000. This rise resulted mainlyfrom the significantly higher (+ 40%) dividend per share paid by Total Fina Elf and,marginally, from GBL’s increased shareholding in the company.

Financial data(in EUR million)

Shareholders’ equity

Market capitalisation

Net current profit (excluding non-recurring items)

Net profit

(in EUR)

Net current earnings per share

(excluding non-recurring items)

Net earnings per share

Net dividend per share

Share price

Number of shares in issue

Group share (in %)

Operating data 2001 2000 1999

(in EUR million)

Turnover

Operating profit of activity sectors

(excluding non-recurring items)

Cash flow

Gross investments of activity sectors

Debt / equity ratio (in %)

Hydrocarbon reserves (in million barrels oil eq./day)

Hydrocarbon production (in '000 barrels oil eq./day)

Liquid hydrocarbon production (in '000 barrels oil eq./day)

Gas production (in million cubic feet/day)

Sales of oil products (in '000 barrels/day)

Employees (in units)

Total Fina ElfFinancial summary

2001

33,932

113,098

7,518

7,658

10.85

11.05

3.80

160.40

705,097,998

3.3

105,318

13,121

12,303

10,566

30.9

10,978

2,197

1,454

4,061

3,724

122,025

2000

32,401

117,162

7,637

6,904

10.80

9.76

3.30

158.40

739,661,987

3.2

114,557

14,884

13,389

8,339

32.9

10,762

2,124

1,433

3,758

3,695

123,303

1999

Pro forma

27,669

95,692

3,349

3,496

4.77

4.98

2.35

132.50

722,203,679

3.4

Pro forma

75,035

6,354

7,012

8,495

49.7

10,455

2,065

1,468

3,322

3,830

127,252

GBL TotalFinaElf 27

Percentage holding(in %)

200120001999

2.7

3.3

2.7

3.4

5.9

(1)

6.3

Capital

Pro forma

Voting rights

Profit(in EUR million)

Contribution to GBL adjusted net assets

200120001999

3,49

6

6,90

4 7,65

8

(1) As at 14 Januari 2001

EUR 3,767 million (EUR 3,080 million in 2000)

40.2%


Suez is one of the largest worldwide service groups, operating in the Energy, Water and Waste Management sectors, serving industrials, individuals and localcommunities

Suez


ActivitiesEmploying 190,000 people and operating in more than 130 countries, Suez (the new corporate identity of SuezLyonnaise des Eaux) has resolved to assert itself as a worldindustrial service group in each of its core activities (Energy,Water and Waste Management), in particular by takingadvantage of market opportunities created by deregulationand outsourcing.

The group’s Energy activities cover not only production(including combined heat and power generation), transport,gas and electricity distribution, but also energy and industrialservices (engineering, installation and maintenance anddistrict heating). In the Water sector, the group is theworldwide no. 1 in water management, water treatment andengineering. In the Waste Management sector, Suez hasoperations covering the management of all types of ordinaryand special wastes, both industrial and household.

Key events in 2001Against a difficult economic background in 2001, Suezrecorded a further rise in its performances confirming thestructural soundness of its growth engines and thepertinence of the industrial model it has developed since1997. During the 2001 financial year, Suez focusedparticularly on:• setting up a horizontal organisation dedicated to its

industrial customers, the structural vector of which, SIS(Suez Industrial Solutions) positions itself as the primecontact for businesses carrying out large-scale multi-service projects.

• carrying out a series of external growth transactions aimedat increasing the size and expanding the skills of each ofthe group’s 3 core activities in the field of service deliveryto the business sector and concluding major contracts notonly with major league industrial groups but also withvarious institutional customers, for example in:- Energy: successive acquisitions by Tractebel of GTI and

Sulzer Infra, respectively leader in electrical installationsin The Netherlands and European operator in technicaland industrial services; the conclusion of major industrialcontracts with customers including Airbus, IBM, Peugeot,Proviron and the municipalities of Milan, Sines andNouméa;

- Water: acquisition by Ondeo Nalco of a controllinginterest in NEEC (Nalco/Exxon Energy Chemical),renamed ONES, a worldwide specialist in on-site watertreatment and chemical processes in the oil industry;concretisation of commercial agreements with groupsincluding Aventis, Imerys, BOC, the cities of Java, Milan,Brno and Grand Amman and various cities of Chinaprovinces (Sanya, …);

- Waste Management: formation by Sita, in partnershipwith Rhodia group, of a new American subsidiary, TerisLLC, specialising in the processing of Special IndustrialWastes; signature of industrial contracts with Aventis,GE Plastics, SAAB, Groupe HBG and the municipalauthorities of Bristol, Brisbane and Madrid.

The effects of these successes include among others thereinforcement of Suez on the North American continent,where the group now achieves nearly 11% of its turnover.

EnergyThe Energy interests, focused around Tractebel, continued tobenefit from the growth impetus of its Electricité et GazInternational (EGI) operating unit in 2001. This division hascontinued its development of generation capacities in variousgeographical zones and the deployment of its activities inLNG, particularly via the expansion of its capacities in theUnited States. During the 2001 financial year, the Electricitéet Gaz Europe (EGE) unit undertook a progressive centra-lisation of its non-regulated activities (formation of Elia andseparation of Fluxys/Distrigaz) and accelerated its commercialnetwork structures in major consumption centres (SparkEnergy, Energie du Rhône, Gera, Shem, etc.). EGE also continued its ongoing efforts to constitute one ofEurope’s most flexible and competitive production capacities,which enabled it to compensate partly the impact of pricereductions for Belgian customers.

Service activities to the Energy sector, which have beensubstantially reinforced during the last few months, werereorganised around 2 operating units, Tractebel EnergyRelated Services (TERS), which includes among others Elyo,Axima and Sulzer, and Tractebel Industrial Installation &Maintenance (TIIM), which brings together companies suchas Fabricom, Ineo and Endel.

GBL Suez 29

Suez financial communication: Frédéric MichellandTel.: +33-1-40.06.66.46Freephone France: 0800-177-177Freephone Belgium: 0800-25-125


WaterOndeo Services, which supplies 115 million customersworldwide, forms one of the pillars of the group’s wateroperations. In 2001, it recorded satisfactory performancesin France, Spain and the United States, despite therecession, and also made significant commercial break-throughs internationally. The Ondeo Degrémont recoveryplans have borne their first fruits, underpinned by an orderbook representing 18 months of operation. Ondeo Nalco,reinforced by the successful integration of Calgon andAquazur, continues its expansion in profitable areas ofoperation with its industrial customers.

Waste ManagementSita concentrated on the consolidation of its Europeanleadership in 2001, in particular by integrating amongothers its Watco/EdS subsidiaries acquired from Tractebel.It also focused on reinforcing its operations in theprocessing and valorisation of waste materials particularlyin the United States, and on strengthening its links with itsindustrial customers. The profit performance of the WasteManagement activity was depressed primarily by falling ofwaste paper prices in Germany and waste disposal rates inthe United Kingdom.

Financial reportDespite the uncertain and fragile economic climate of 2001,Suez achieved double-digit growth in practically all its financialparameters over the financial year, in line with the medium-term objectives fixed by the group for the 2001-2004 period.

Consolidated group turnover was EUR 42.4 billion in 2001,22.4% up compared with 2000 (+ 13.4% excluding tradingactivities). The organic growth was 7.1%, with all groupdivisions contributing to this growth. Turnover by groupoperating divisions outside France and Belgium increased by38%, energy trading activities excluded, and now represents55%, energy trading activities excluded, of Suez’s totalturnover (compared with 49% in 2000).

Gross operating margin (EBITDA) of the group’s worldactivities was EUR 7,455 million, 8% up compared with2000. The operating margin rate of the group’s core globalbusinesses (energy trading activities excluded) wasmaintained at around 20%.Group share of net current profit of the group’s globalbusinesses for the year was EUR 1,150 million, anincrease of 12.5%, underpinned in particular byperformances in Energy and Water. The Energycontribution (EUR 819 million) grew strongly (+ 13.7%),buoyed up by the expansion of EGI activities, whichcompensated largely the small drop in profit reported byElectrabel under the impact of the programme of regulatoryprice reductions. Water contributed for EUR 253 million tothe overall profit figure, a rise of 12%, reflecting inparticular the recovery at Ondeo Degrémont and the effectof productivity gains and growth by Ondeo Nalco.Group share of net profit rose by 8.7% to EUR 2,087 million,which equates to diluted earnings of EUR 2.08 per share, arise of 7.6%. This profit figure includes a net extraordinaryprofit comprising:• capital gains resulting from trading transactions involving the

non-strategic share portfolio (Vinci, Axa, Fortis andTotal Fina Elf);

• extraordinary charges (excluding energy trading activities)relating particularly to restructuring in progress at OndeoNalco and Electrabel, and foreign exchange loses in Braziland Argentina in particular. The net impact of devaluation ofthe Argentinean peso was EUR 80 million.

Cash flow of the group’s world global activities was EUR 5.0 billion, an increase of 11.6% compared with 2000.Group net economic debt was EUR 24.5 billion. The debtto equity ratio remained practically stable at 118%, whilegross operating profit covered net financial costs more than5 times in 2001. As at 31 December 2001, saleableassets represented a market value of EUR 8.3 billion,including EUR 3.5 billion of monetised assets.

A net dividend of EUR 0.71 per share (7.6% up on theprevious year) will be recommended to the Annual GeneralMeeting on 26 April 2002, making a total dividend of EUR 1.065 per share. This dividend will be payable from2 May 2002.

30 GBL Suez

www.suez.com


GBL Suez 31


200120001999

6.7 7.1

6.0

13.9

12.8

12.5




Profit

(in EUR) (1)

Earnings per share

Net dividend per share

Share price


Group share (in %)

Operating data (in EUR million)

Turnover

Gross operating profit from global activities

Operating profit

Net consolidated debt (2)

Financial investments and capital expenditure

Cash flow


Return on capital employed (in %)


(1) The 1999 and 2000 figures are adjusted for the multiplication of the number of shares by 5(2) Net of monetised assets

2001

14,397

34,681

2,087

2.08

0.71

34.00

1,026,280,965

7.1

2001

42,359

7,455

4,064

24,497

7,821

4,817

118

8.9

190,000

2000

13,134

39,534

1,919

1.94

0.66

38.90

1,021,328,585

7.3

2000

34,617

6,905

3,778

22,600

12,178

4,492

111

10.0

173,000

1999

11,271

31,570

1,452

1.81

0.60

31.80

992,146,530

8.4

1999

31,462

5,346

2,932

17,100

19,033

3,933

97

10.1

217,000

SuezFinancial summary

Capital

Voting rights


200120001999

1,45

2

1,91

9

2,08

7

Contribution of Suez to GBL adjusted net assets and profit

As at 31 December 2001, the valuation of GBL’s interest in Suez represented just over a

quarter of GBL’s adjusted net assets. It amounts to EUR 2,464 million, nearly 5% up

compared with 31 December 2000 (EUR 2,355 million).

This year-on-year rise reflects the combined effects of the following in particular:

• GBL’s increased shareholding in the company further to the merger by absorption with its

subsidiary Electrafina, which held the shareholding. GBL’s transitive interest in Suez

amounted to 7.1% at 31 December 2001, compared with 6.0% on 31 December 2000.

• A 13% fall in the share price of Suez shares over the 2001 financial year.

The net contribution of Suez to GBL’s current profit corresponds to GBL’s share in the net

dividend received from the French group, which amounts to EUR 67 million in 2001,

compared with EUR 61 million in 2000. This increase resulted essentially from the merger of

GBL and Electrafina and the higher dividend per share distributed by Suez.


EUR 2,464 million(EUR 2,355 million in 2000)

26.3%


32 GBL RTL Group

Bertelsmann Bertelsmann is an integrated, largely TV- and Internet-driven media and entertainment company that commands leading positions in the world's major media markets


ActivitiesThe content activities of the group includes RTL Group,Europe's no. 1 television, radio and TV-production business, as well as the world's largest book-publishing group RandomHouse with its more than 150 publishers. The internationalpublishing house Gruner + Jahr, the Bertelsmann Music Group(BMG) with its roughly 200 labels, and the specialist-information group BertelsmannSpringer also stand for creativecontent and powerful brands. Bertelsmann's direct-to-customerbusinesses, bundled in the DirectGroup, represent thecompany's second strategic business unit: DirectGroup includesbook and music clubs, along with a wide range of e-commerceventures. Bertelsmann's third area of business are the mediaservices offered by the Arvato division: beyond the rapidlyexpanding Services Group (data management, call centers,distribution), the international media service provider alsocomprises state-of-the-art printers, storage media productionand digital rights management. Bertelsmann has more than80,000 employees in 55 countries.

Key events in 2001Corporate In May 2001, Bertelsmann launched the BertelsmannExcellence Initiative (BEX) as a long-term, group-wideprogramme to improve all work processes. Increasedcooperation, innovation, realization of synergies and processoptimization are expected to result in more attractive mediaproducts and services for customers. Excellence incorporate management and performance is the goal.

ContentRTL GroupIn early February 2001, Bertelsmann announced a shareswap with the group GBL, who gave their 29.9%RTL Group holding to Bertelsmann in exchange for a 25.1% stake in Bertelsmann (of which 0.1% are non-votingshares). At the end of 2001, the media company agreed topurchase an additional 22% in RTL Group from Pearson plc.Bertelsmann now owns 90% of the shares in Europe'slargest TV and radio group. For Bertelsmann, theseacquisitions are important steps towards becoming anintegrated media and entertainment group of the future thatis decisively driven by TV and the Internet.

RTL Group forms the cornerstone of this strategy: it is thelargest pan-European TV, radio and production company, withholdings in 23 television channels and 14 radio stations ineight European countries. As the producer of more than 200programmes in 35 different countries, Luxembourg-based RTLGroup is one of the world’s leading non-US content providers.Its 85 branded websites make the group one of the mainplayers in the European online arena. In 2001, RTL Group,Canal+ and Groupe Jean-Claude Darmon bundled their sportsrights companies in the new agency Sportfive and thuscreated one of the leading sports rights marketers in Europe.

Random HouseAs of 1 April 2001, all Bertelsmann book-publishingactivities were reorganized. The trade book publishinghouses of Bertelsmann Buch were regrouped within RandomHouse. Its English-language publishers, including suchfamous imprints as Ballantine Books, Bantam Dell and theKnopf Publishing Group make Random House the world’sbiggest English-language publishing house. In 2001,Random House prevailed in a bidding competition for GoldenBooks Entertainment, one of the leading US children’s bookpublishers. Random House and Mondadori united theirrespective worldwide Spanish-language book publishingoperations in a newly created joint venture called RandomHouse Mondadori. In Germany, the activities of"Verlagsgruppe Random House" include such imprints as C. Bertelsmann, Albrecht Knaus, Siedler Verlag, Berlin Verlagand Goldmann paperbacks. In October 2001, VerlagsgruppeRandom House took over Luchterhand Literaturverlag.

Gruner + JahrGruner + Jahr (G+J) was able to reinforce its position asthe world’s most international periodical publishingenterprise, comprising over 100 magazines andnewspapers in 14 countries. G+J began the newmillennium with a series of far-reaching strategic moves.Management kicked off an active investment programme inthe United States by acquiring "Inc. Magazine" and "FastCompany" and editorially revamping nearly all itsperiodicals. In the medium term, G+J is determined toenhance its position on the world’s largest magazinemarket, where it currently ranks fifth.

Bertelsmann financial communication: Oliver HerrgesellTel.: +49-52.41.80.24.66 Fax: +49-52.41.80.66.13 e-mail: [email protected]

GBL Bertelsmann 33


BMG2001 was a year of challenges and new beginnings forBMG. A planned merger with the British music companyEMI was not realized for regulatory reasons. Among themajor challenges were weak market conditions in mostterritories around the world and the impact of various formsof piracy. BMG’s new executive team reorganized the group’sstructure and business units to focus the company on itscore competencies - fostering artistic talent and marketingmusic. BMG has a strong release schedule for 2002 -including albums from multi-platinum artists such asSantana, TLC, Dido and Whitney Houston.

BertelsmannSpringerThe BertelsmannSpringer publishing group producesroughly 700 special-interest magazines and some 25,000 book titles for target audiences in medicine,natural sciences, engineering, industry, construction andtransportation. Although economic conditions wereextremely precarious in industrial sectors relevant to thepublishing group, its core businesses performed well. In June 2001, BertelsmannSpringer took over the Belgianconstruction publisher MediaOffice and is now no.1 inBelgium’s construction industry.

Media Services ArvatoWith its roughly 60 subsidiaries all over the world, Arvatois one of the biggest internationally networked mediaservice providers. The group is comprised of theBertelsmann Services Group, storage media production,digital rights management and state-of-the-art printers. The integration of the Bertelsmann Storage Media divisionbegan in mid-2001. This division includes Sonopress, the world’s leading manufacturer of CDs and DVDs; the multimedia-printing operation topac; and Digital WorldServices, the forerunner in Internet digital rightsmanagement. The division was formerly part of BMG.

Direct-to-CustomerDirectGroup BertelsmannDirectGroup Bertelsmann combines Bertelsmann’s traditionalstrengths in direct marketing and programme expertise withthe online distribution of books and music. DirectGroupserves about 60 million customers and members worldwide; it ranks first among book and music clubs, with more than40 million subscribers. Augmenting this customer base arenearly 20 million registered users and customers of e-commerce operations and online services.

Building the largest music distribution in the US is ofstrategic significance to the division. BeMusic, established inJuly 2001, has the goal of covering the entire online andoffline value-added music distribution chain.

In May 2001, roughly two years after its launch, theinternational media and entertainment vendor BOL wasintegrated into regional Bertelsmann club operations. Online and offline businesses are being networked. On 1 July 2001 Bertelsmann became the sole shareholderof the French book club France Loisirs, which was previouslyoperated as a 50-50 joint venture with Vivendi Universal.

34 GBL Bertelsmann


Financial reportFirst half of 2001: RTL GroupBefore deduction of restructuring costs and launch costs of new activities (EUR 38 million), EBITA was EUR 273 million in the first half of 2001, a fall of 27%compared with the first half of 2000.Net earnings before adjustment of goodwill (impairment ofEUR 2,276 million) amounts to EUR 87 million comparedto a loss of EUR 38 million.

Second half of 2001: BertelsmannBertelsmann reported net earnings of EUR 949 million inthe second half of 2001.

This profit was influenced by capital gains on asset sales(EUR 2.2 billion, mainly AOL shares), restructuring costs(EUR 428 million), Internet costs (EUR 226 million) and theimpact of the events of 11 September on the markets inwhich the group operates.

Excluding these factors, Bertelsmann recorded an operatingprofit of EUR 212 million.

As at 31 December 2001, Bertelsmann’s financial debtstood at EUR 422 million. Since this date, Bertelsmann haspaid out some EUR 1.5 billion to acquire Pearson’s interestin RTL Group and received some EUR 2.7 billion for the saleof the balance of its interest in AOL.

Bertelsmann’s rights and commitments not shown in thebalance sheet include call and put options held by SummerShore:

1. BMG Holding B.V. ("BMG") had entered into a"Stockholders Agreement" and an "Option Agreement",both dated as of 27 November 1991, with SummerShore N.V. ("SSN"). BMG currently holds 25% in ZombaMusic Holdings B.V. ("Zomba Publishing") and 20% inZomba Records Holding B.V. ("Zomba Records").

2. Both Agreements have been amended several times,most recently as of 17 December 2001. As of today,they contain the following put and call options : • SSN has put options, exercisable until the end of 2002,

to require BMG to purchase all of SSN’s shares inZomba Records and Zomba Publishing. If not exercisedby the end of 2002, SSN’s put options terminate. In case SSN should decide to exercise, it has to exerciseboth the Publishing and the Records put optionsimultaneously.

• The respective purchase price for Zomba Records andZomba Publishing has to be determined in accordancewith a formula set forth in the Agreements and isbased on the results for the financial years 1999,2000 and 2001. SSN has indicated that the overallpurchase price for both Zomba companies amounts toabout USD 3 billion. Such calculation would have tobe reviewed in case of an exercise of the put options.

• Should SSN decide not to exercise its put options by theend of 2002, it may exercise a call option for BMG’sstake in Zomba Records and Zomba Publishing. Suchcall options are exercisable until 31 December 2006and provide for a price of one (1) Dutch Guilder each.In anticipation of such potential exercise, BMG haswritten off its stake in the two Zomba entities already.

GBL Bertelsmann 35

www.bertelsmann.com


36 GBL Bertelsmann


Balance sheet

Assets

Goodwill

Intangible assets

Property – Plant & equipment

Financial assets

Stocks

Trade debtors

Other short-term assets

Cash deposits and cash

Deferred taxes

Prepayments and accrued income

Total

Liabilities


Minority interests

Profit participation certificates

Provisions for pensions and similar commitments

Other provisions

Deferred taxes

Financial debt

Leasing

Trade creditors

Other short-term debt

Accruals and deferred income

Total

(1) These accounts concern a six-months period ending on 31 December 2001 and established in accordance with the IFRS and will bedefinitively closed by the Supervisory Board of Bertelsmann on 19 April 2002 and approved by the Ordinary General Meeting to beheld on 24 May 2002

(2) German GAAP

31/12/2001 (1)

7,289

1,158

3,017

1,400

1,941

3,612

2,960

2,044

190

189

23,800

6,303

2,081

706

1,682

3,863

207

2,466

437

2,713

2,862

480

23,800

30/06/2001 (2)

-

4,241

2,767

1,451

2,212

3,249

2,573

825

-

233

17,551

1,919

1,876

706

1,537

4,172

-

2,706

-

2,488

1,751

396

17,551

30/06/2000 (2)

-

3,857

2,125

1,290

1,696

3,021

2,031

494

-

178

14,692

1,675

1,276

687

1,446

2,914

-

2,642

-

2,473

1,261

318

14,692


BertelsmannFinancial summary

GBL Bertelsmann 37

Percentage holding (1)

(in %)

200120001999

25.1

25.0

Capital

Voting rights

(1) As of 2 July 2001

Contribution of Bertelsmann to GBL adjusted net assets and profit

As at 31 December 2001, GBL’s adjusted net assets included an amount of EUR 2.3 billion in

respect of GBL’s share of the shareholders’ equity of Bertelsmann (replacing RTL Group).

Bertelsmann’s shareholders’ equity amounting to EUR 6.3 billion has been adjusted to take

into account the capital gain to be realised in 2002. This share in adjusted shareholders’

equity is not an estimation of the value of the stake but rather a simple known and objective

accounting reference, and it is up to the market to decide on the value that it wishes to place on it.

Bertelsmann made a negative contribution of EUR 142 million to GBL’s current profit in 2001,

compared with RTL Group’s positive contribution of EUR 13 million for the first six months of

the financial year.


EUR 2,276 million(RTL Group for EUR 3,552 million in 2000)

24.3%

(in EUR million)

Earnings

Turnover

EBITA

Amortisation of goodwill

Interest expenses

Taxes

Third-party interests

Net earnings (group share)

Group share (in %)

(*) Breakdown of the current earnings

before interests, taxes and amortisation

of goodwill (EBITA)

Divisional result

Corporate / BeCapital

Internet losses

Non-recurring expenses

Capital gains AOL Inc. and Europe

Capital gain Sportfive

(1) These accounts concern a six-months period ending on 31 December 2001 and established in accordance with the IFRS (2) German GAAP

31/12/2001 (1)

6 months

9,685(*) 1,702

(570)

(208)

7

18

949

25.1

212

(82)

(226)

(428)

2,081

145

30/06/2001 (2)

12 months

20,458

3,076

(482)

(302)

(1,322)

(77)

893

-

30/06/2000 (2)

12 months

16,584

1,545

(255)

(190)

(428)

(57)

615

-


38 GBL RTL Group

ImerysWorld leader in the production, processing and marketing of minerals


ActivitiesImerys is one of the world’s leading minerals processors,occupying leading positions in each of its four businesssegments: Pigments & Additives, Construction Materials,Refractory & Abrasive Materials, Ceramics & SpecialityProducts.In these sectors, the group is pursuing a strategy of growthand value creation: based on substantial mineral reserves andthe use of sophisticated processing technologies, the groupdelivers engineered products which are vital to the activities ofits customers across a broad spectrum of industries.

Key events in 2001In 2001, Imerys continued developing its activities in adifficult economic environment characterised by thedeterioration of markets in the second half of the year,especially in paper and refractories, and most particularly inthe United States. The diversity of its markets and its dynamicacquisition policy enabled the group to pursue its growth.

The total turnover recorded by Imerys was EUR 2.9 billionin 2001, compared with EUR 2.8 billion in 2000, i.e. a riseof 3.3 %. This reflects the impact of external growthtransactions (+ 7.9%) which have in particular enabled thegroup to reduce the exposure of its Refractories & Abrasivesactivities to the weakness of the steel market (acquisition ofTreibacher) and opened up new markets for the Ceramics &Speciality Products sector (acquisition of K-T).

Continuing improvement in the quality of the group’sproducts and services enabled it to raise prices, partlycompensating for the sharp fall in sales volumes as a resultof a deteriorating demand. Overall, like-for-like groupturnover at constant exchange rates fell by 4.3%.

Pigments & AdditivesThe turnover of the group’s Pigments & Additives activitieswas EUR 1.2 billion in 2001, down 2.3% compared with2000. Like-for-like at constant exchange rates, the dropreached 4.9% for the full financial year.

While the deterioration of American and European papermarkets significantly depressed this sector’s activities, priceincreases compensated for some of these negative effects.The fall in sales also reflects decisions taken to focus thecapacity and integration of the American production of kaolinfor paper on products offering higher added value.

Construction MaterialsThe Construction Materials sector recorded a turnover ofEUR 0.6 billion, up 1.6% compared with 2000. After anexceptionally good year 2000 (impact of the storms of lateDecember 1999), business remained firm in roofingmaterials thanks to renovation work and the goodpositioning of the group’s range of products and services in this sector. Like-for-like turnover rose by 0.9%.

Refractories & AbrasivesRefractories & Abrasives contributed EUR 0.7 billion toturnover in 2001, an increase of 11% compared with 2000.This reflects the impact of the acquisition in mid-2000 ofTreibacher, the world’s largest producer of minerals forabrasives, which accounted for approximately one third ofthis activity’s full-year turnover. Treibacher pursued itsEuropean growth in 2001 with acquisitions in the CzechRepublic and Germany, while implementing synergies withother activities in this sector. Like-for-like at constantexchange rates, the turnover fell by 9.7%. With the sharpfall in demand in some end-user markets (steel industry, in particular in the United States, and semiconductors) andthe stock adjustment by customers, sales plummeted by16% during the second half of the year after remainingpractically stable during the first half of the year.

Imerys financial communication:Isabelle BiarnèsTel.: +33-1-45.38.37.76Fax: +33-1-45.38.70.43e-mail: [email protected]

GBL Imerys 39


40 GBL Imerys

Ceramics and Speciality ProductsCeramics and Speciality Products turnover rose by 15.2%to EUR 0.3 billion. After the various transactions completedin 2000, this activity continued its geographical expansionand enriched its product range with the acquisition, on 1 April 2001, of the American K-T group, a specialistproducer of kaolin, feldspath and ceramic clays for thesanitary ware industry. Like-for-like at constant exchangerates, the turnover fell slightly (- 1.1%) as a result ofsustained activity in the sector’s main markets during thefirst half-year (+ 4.9%) and deteriorating marketconditions over the second half-year (- 7.1%), particularlyin ceramics for chinaware and tiles.

Financial reportOperating profit remained practically stable at EUR 344 million in 2001. The effect of lower salesvolumes and higher energy costs was largely compensatedfor by the combined impact of acquisitions, increasedselling prices and reduced production costs.

Net profit rose slightly to EUR 171 million, compared withEUR 167 million in 2000, due to good control of debt andfinancial charges.

Group share of net profit fell to EUR 79 million,compared with EUR 140 million in 2000. This includedEUR 32 million amortisation of goodwill and anextraordinary net loss of EUR 60 million essentiallylinked to the intensification of measures taken by thegroup to improve its industrial efficiency (EUR 57 million,EUR 15 million of which was accounted for byrestructuring charges and EUR 42 million in adjustmentsto asset values).

www.imerys.fr


Financial data(in EUR million) 2001 2000 1999



Net operating profit

Net profit

(in EUR)

Net operating profit per share

Dividend per share (1)

Share price


Group share (in %)

(1) excluding tax credit

Operating data(in EUR million) 2001 2000 1999

Turnover

Operating profit

Cash flow

Net debt


Capital expenditure


GBL Imerys 41

ImerysFinancial summary

1,577

1,715

171

79

10.75

3.70

107.80

15,906,683

26.3

2,898

344

362

1,411

89

176

14,496

1,534

1,932

167

140

10.42

3.60

121.00

15,965,109

26.2

2,805

347

306

1,327

86

176

14,583

1,457

2,384

143

227

8.91

3.20

148.00

16,109,881

26.0

2,615

287

302

933

64

162

11,948


200120001999

26.0

26.3

26.2

30.5 34

.0

20.5

Capital

Voting rights


200120001999

227

140

79

Contribution of Imerys to GBL adjusted net assets and profit

At EUR 451 million, GBL’s share in Imerys’ adjusted net assets represented 4.8% at

31 December 2001, compared with 5.0% on 31 December 2000.

Imerys contributed EUR 19 million to GBL’s current profit in 2001, compared with

EUR 32 million in 2000. Although Imerys succeeded in maintaining a good level of

profitability, it made a substantial charge for provisions, leading to a fall in net profit

for the year.


EUR 451 million (EUR 507 million in 2000)

4.8%


RhodiaRhodia is a world leader in speciality chemicals


Rhodia financial communication: Angelina Palus and Sylvie MarchalTel.: +33-1 55.38.42.99 or +33-1 55.38.41.79 Fax: +33-1 55.38.41.44e-mail: [email protected] [email protected]

ActivitiesOperating in 150 countries and employing some 27,000people, Rhodia is one of the world’s major specialitychemicals groups. The group is listed on the Paris andNew York Stock Exchanges.

Rhodia supplies products and services to the automotive,health, fragrances, apparel, electronics, beauty andenvironment markets.Rhodia’s specialities are the fruit of technological expertise,industrial skills and a marketing vision focused resolutelyon innovation.

Two-thirds of Rhodia’s turnover is accounted for byproducts for which it is the world leader, such as aspirin,vanillin, edible phosphates, polyamide (nylon), rare earths,guar, food enzymes and high-dispersibility silica. Followingthe successful friendly takeover bid for ChiRex in 2000,the Rhodia group is also a major player in the provision ofhigh-tech services to the pharmaceutical industry.

Key events in 2001In 2001, Rhodia faced a depressed economic climate compounded by the strongly disruptive influence of highraw materials prices. Overall, despite the severe crisis insome of its end-user markets such as textiles and electronics,Rhodia recorded a turnover of EUR 7.3 billion in 2001 down1.9%, 0.1% of which was related to the effects of structureand change.

In this particularly difficult context, Rhodia pursued not onlythe integration of its major acquisitions completed in 2000(Albright & Wilson and ChiRex) but also a number of majorstructural measures designed to improve long-term profita-bility. These restructuring measures are aimed at optimisingproduction capacity utilisation in the group’s various divisions,reducing fixed costs and limiting investments while maintainingresearch and development efforts.

The group also continued to implement its change programmesstarted in 1998 from the earliest year of the group’s existence.These programmes include measures designed to optimise theefficiency of its entire industrial processes (WCM), its researchand development and also its marketing systems.

Fine OrganicsSales recorded by the Fine Organics Division reached EUR 1.2 billion in 2001, an increase of 2.9% comparedwith 2000. Like-for-like and at constant exchange rates,sales for the financial year fell by 2.3%. The PharmaceuticalIngredients activity, which is currently being restructured, isstill suffering from overcapacity and competition from Asia.Meanwhile, Rhodia ChiRex recorded strong growth in itsContract Research division, while problems with the start-upof an industrial investment caused a delay in sales by theManufacturing division around the end of the year. The Agrochemicals division was depressed following theconsequences of the explosion at the AZF plant in Toulouse.

Consumer Product SpecialitiesThe Consumer Product Specialities division recorded aturnover of EUR 2.2 billion in 2001, a fall of 1.3% comparedwith 2000. The Speciality Phosphates activity is still sufferingfrom the effects of overcapacity despite increasing its sellingprices. Sales volumes by the Phosphate Derivatives activitysuffered from the full shock of the collapse in Americandemand during the second half of the year, although it wasable to achieve growth from the launch of new products in thecosmetics, detergent and food segments.

Industrial Speciality ProductsThe Industrial Speciality Products division contributed EUR 1.2 billion to 2001 turnover, a fall of 1.5% due to thenegative effects of currency translation (- 3.5%) linked to the Brazilian Réal. Sales trends vary according to each areaof activity, rising in Paints and Construction Materials andremaining stable in Silicones despite a difficult second half-year in America. Demand for Silicates grew in Europe inspeciality markets such as pneumatics and toothpastes,while sales to the Asian shoe market were depressed.

PolyamideTurnover by the Polyamide activity fell by 9.1% to EUR 1.4 billion, also influenced by a 4.1% loss oncurrency translation linked to the Brazilian Réal. This fallwas also due to problems encountered in textile marketsand electronics, particularly in the area of EngineeringPlastics applications.

GBL Rhodia 43


44 GBL Rhodia

Services and Speciality ProductsThe Services and Speciality Products division recorded arise in turnover of 2.9% to EUR 1.0 billion. Like-for-likeand at constant exchange rates, sales volume fell by 4.3%,but this was largely compensated for by a 7.1% price rise.The Acetow and Eco-Services activities generated the bulkof this growth, while Electronics applications sufferedoverall from deteriorating market conditions.

Financial reportIn a very difficult economic climate, Rhodia recorded aturnover of EUR 7.3 billion for the 2001 financial year,practically stable compared with its 2000 performance ofEUR 7.4 billion. However, gross operating margin (EUR 633 million) fell by 38% compared with 2000,influenced in particular by provisions for restructuring (EUR 163 million) and exceptional charges (EUR 26 million)recorded by the group. On a recurring basis, gross operatingmargin was EUR 823 million, 22% down compared with2000. Operating profit amounted to EUR 16 million,compared with EUR 496 million in 2000, influenced byfactors such as the overall costs of restructuring measures(EUR 253 million). Consequently, the group recorded a netloss of EUR 213 million. The net recurrent profit amountedto EUR 69 million.

A net dividend of EUR 0.12 per share will be recommendedfor approval at the Annual General Meeting to be held on 21 May 2002, compared with EUR 0.40 per share inrespect of the previous financial year. This amounts to anidentical rate of distribution of net recurrent profit comparedwith last year.

www.rhodia.com


GBL Rhodia 45

Financial data(in EUR million) 2001 2000 1999



Net profit

(in EUR)

Earnings per share

Dividend per share

Share price


Group share (in %)

Operating data (in EUR million) 2001 2000 1999

Turnover

Gross operating margin (EBITDA)

Operating profit

Net consolidated debt

Financial investments and capital expenditure

(excluding financial sector)


Return on capital employed (in %)


RhodiaFinancial summary

2,267

1,610

(213)

(1.19)

0.12

8.98

179,309,188

5.3

7,279

633

16

2,572

154

109.0

(0.1)

26,925

2,593

2,959

216

1.23

0.40

16.50

179,309,188

5.3

7,419

1,020

496

3,066

2,049

114.0

8.6

29,448

2,390

3,921

227

1.30

0.40

22.44

174,741,041

5.1

5,526

832

409

1,553

144

63.2

9.1

24,806


200120001999

5.1 5.3

5.3

5.1 5.

5

5.1

Capital

Voting rights


200120001999

227

216

(213

)

Contribution of Rhodia to GBL adjusted net assets and profit

Rhodia contributed EUR 86 million to GBL’s adjusted net assets as at 31 December 2001.

GBL received a dividend of some EUR 4 million from Rhodia in 2001.

In view of the fall in the quoted share price of Rhodia shares and the uncertain situation

affecting the company and its sector, an amount of EUR 86 million was written down

against the group’s interest in Rhodia, reducing the book value of this asset to its market

value on 31 December 2001.


EUR 86 million (EUR 181 million in 2000)

0.9%



Economic summary 48

Adjusted net assets 48

Earnings analysis 50

Consolidated accounts 55

GBL Accounts as at 31 December 2001 47

Accounts as at 31 December 2001


48 GBL Economic summary

Economic summary

The analysis of the evolution of GBL’s adjusted net assets and profit provide two key indicators for assessing the group’s performance.

1. Adjusted net assetsThe publishing of the adjusted net assets on a weekly basis is part of a communication process aimed at current and potentialGBL shareholders. The weekly adjusted net assets are calculated by using the same rules than those applied whendetermining the quarterly adjusted net assets. However, minor events that have occurred since the last closing of the bookscan at times not be taken into account in the figure published weekly. However the combined effects of all these elements willnot exceed 1% of the adjusted net assets.

Valuation principlesGBL’s adjusted net assets are a conventional reference calculated by valuing the consolidated assets (i.e. mainly the group'sportfolio) according to the following principles and adding to it the group's net cash position:• the share price for listed companies; • the group share of shareholders' equity for unlisted companies integrated using the equity method; • the book value for unlisted companies not consolidated or not integrated using the equity method.

A. Breakdown of adjusted net assets as at 31 December 2001As at 31 December 2001, GBL’s adjusted net assets amount to EUR 9,373 million or EUR 67.77 per share, compared withEUR 10,017 million or EUR 82.00 per share respectively at the end of the previous financial year.This evolution reflects mainly:• Further to the merger by absorption of GBL by Electrafina in April 2001, the integration by GBL of the 17.2% of

Electrafina it did not hold on 31 December 2000;• The impact of the exchange of the 29.9% interest in RTL Group (valued at EUR 87.50 per share on 31 December 2000)

for 25.1% of Bertelsmann, valued on the basis of GBL’s group share in the consolidated shareholders’ equity ofBertelsmann as at 31 December 2001;

• The resistance of the Total Fina Elf share price, counterbalanced by the fall of over 10% in the share price of Suez shares.

The table below gives a detailed view of GBL’s adjusted net assets, showing the various components of GBL group’sinvestment portfolio and its net cash position.

31 December 2001 31 December 2000

RTL Group

Total Fina Elf

Suez

Bertelsmann

Imerys

Rhodia

Other investments

Portfolio

Net cash (3)

Adjusted net assets

(1) Including call options on RTL Group shares valued at EUR 384 million (EUR 87.50 per share)(2) After division of the share by 5(3) Including GBL’s own shares(4) Including debt related to the exercise of call options on RTL Group shares valued at EUR - 238 million

%

35.5

30.8

23.5

-

5.0

1.8

2.9

99.5

0.5

100.0

(in EUR million)(1) 3,552

3,080

2,355

-

507

181

296

9,971(4) 46

10,017

Share price(EUR)

87.50

158.40(2) 38.90

-

121.00

16.50

-

-

%

-

40.2

26.3

24.3

4.8

0.9

0.3

96.8

3.2

100.0

(in EUR million)

-

3,767

2,464

2,276

451

86

26

9,070

303

9,373

Shareprice(EUR)

-

160.40

34.00

-

107.80

8.98

-

-


GBL Economic summary 49

It will be recalled that the Board of Directors of GBL held on 13 March 2001 decided to use as a reference for the inclusion ofBertelsmann in GBL’s adjusted net assets as from 2 July 2001, an amount determined by the counter-value of the RTL Groupshare price on the day of the exchange. The Board thus intended to use a historic cost data, leaving it up to the market todetermine the value it wishes to assign to this shareholding.

In this same spirit, and given Bertelsmann’s move to the IFRS, it has been decided that the element of reference to be used asfrom 31 December 2001 would be GBL’s share in Bertelsmann’s consolidated shareholders’ equity. This approach is consistentwith the group’s usual handling of unlisted shares and refers to a known and objective accounting data published officially andperiodically by Bertelsmann.

As in the past, this measure does not represent an estimate of the value of the holding, but only a simple accounting reference. It is for the market to determine the value to be attached to such interest.

This change in procedure has a mechanical impact on the calculation of GBL’s adjusted net assets.

B. GBL’s adjusted net assets per share since 1993 The table below shows GBL’s adjusted net assets per share since 1993, reflecting changes in the GBL investment portfolioand in percentage holdings in the various investments.

(in EUR)

RTL Group

Total Fina Elf

Suez

Bertelsmann

Imerys

Rhodia

Other investments

PetroFina

BBL

Royale Belge

Tractebel

Portfolio

Cash

Adjusted net assets

Share price

(1) Per share figures adjusted for the division of the GBL share by 5

1999 (1)

26.32

21.10

17.41

-

5.07

1.64

1.77

-

-

-

-

73.31

(4.87)

68.44

40.00

2000 (1)

29.07

25.21

19.28

-

4.15

1.48

2.43

-

-

-

-

81.62

0.38

82.00

50.60

2001-

27.24

17.81

16.46

3.26

0.62

0.19

-

-

-

-

65.58

2.19

67.77

59.05

1998 (1)

8.13

-

17.40

-

2.93

-

1.53

13.01

-

-

-

43.00

4.93

47.93

34.71

1997 (1)

4.84

-

5.40

-

2.93

-

4.42

6.74

4.65

4.20

-

33.18

2.49

35.67

26.57

1996 (1)

5.16

-

1.38

-

3.16

-

4.99

5.45

3.53

2.84

-

26.51

2.43

28.94

20.25

1995 (1)

5.59

-

-

-

1.58

-

3.90

4.61

2.62

2.59

3.37

24.26

0.32

24.58

19.83

1994 (1)

5.68

-

-

-

1.31

-

4.58

4.76

2.16

2.16

2.54

23.19

0.14

23.33

18.69

19935.61

-

-

-

1.28

-

4.57

4.60

2.23

2.70

2.78

23.77

1.62

25.39

19.91

(1)


C. Share price of portfolio investments since 1993This table shows an analysis of GBL portfolio investments over a period of 8 years.

(in EUR)

GBL

Share price (1)

Adjusted net assets (1)

Total Fina Elf

Suez

Imerys

Rhodia

(1) The 1993-2000 share price and adjusted net assets figures are adjusted to take into account the division of the GBL share by 5(2) After division of the share by 5

D. Statutory Auditor’s opinion of the adjusted net assetsThe methodology used to calculate the adjusted net assets has been reviewed by the Statutory Auditor. The implementation ofthis methodology produces a value of EUR 67.77 per GBL share as at 31 December 2001.

E. Weekly publication of adjusted net assetsThe adjusted net assets are published each week on the GBL website (http://www.gbl.be). This value is calculated inaccordance with the rules set out on page 94 of the annual report, using certain simplified assumptions whose combinedeffect does not exceed 1% of the adjusted net assets.

2. Earnings analysisThe tables shown below in this analysis are intended to complement the financial and economic vision of GBL’s consolidatedprofit as calculated in accordance with the IFRS.

• Cash earnings show the amount of cash generated by the combination of financial assets and net cash which compose theGBL’s net assets. These cash earnings represent GBL’s dividend payment and self-financing capability.

• Mark to market and other non-cash items show the changes in fair values of the financial instruments shown in GBL’sassets and liabilities (other than those financial assets revalued through shareholders’ equity), but do not influence thegroup’s cash position.

• The associated companies column comprises the GBL share in their earnings and the amortisation of goodwill on theseinvestments.

• Eliminations and capital gains include the cancelling out of dividends received from associated companies and cash andnon-cash profits and losses on sales of and amounts written down on investments.

The current earnings used in this analysis are the net profit before amortisation of goodwill and earnings on disposals andwrite-downs on long-term investments.

The comments and analyses relate only to the GBL share obtained by deducting from each heading the minority interestsshare of Electrafina and RTL Group (previously Audiofina). However, further to the merger by absorption of GBL by Electrafinain 2001 and the consolidation of RTL Group using the equity method on 1 July 2000, the 2001 profit figures no longerinclude any minority interests.


1994

18.69

23.33

-

-

78.66

-

1995

19.83

24.58

-

-

89.18

-

1996

20.25

28.94

-(2) 13.78

116.78

-

1997

26.57

35.67

-(2) 20.31

114.03

-

1993

19.91

25.39

-

-

84.15

-

1998

34.71

47.93

86.76(2) 35.00

85.37

-

1999

40.00

68.44

132.50(2) 31.82

148.00

22.44

2000

50.60

82.00

158.40(2) 38.90

121.00

16.50

2001

59.05

67.77

160.40

34.00

107.80

8.98

Annual composite

growth rate

14.6%

13.1%

22.7%

19.8%

3.1%

(36.7%)


31 December 2001Group share

(in EUR million)

Current earnings in associated companies

Net dividends on long-term investments

Interest income and expenses

Other financial income and expenses

Other operating income and expenses

Income taxes

Current income

Group share in earnings on disposals and

write-downs on long-term investments

recorded by :

Consolidated companies

Companies consolidated using the equity method


Net profit for the financial year

31 December 2000Group share

(in EUR million)

Current earnings in associated companies

Net dividends on long-term investments




Income taxes

Current income

Group share in earnings on disposals and

write-downs on long-term investments

recorded by :


Companies consolidated using the equity method


Net profit for the financial year


Associatedcompanies

(109.6)

-

-

-

-

-

(109.6)

-

4.2

(28.2)

(133.6)

Eliminationsand

capital gains

-

(53.4)

-

-

-

-

(53.4)

439.0

-

-

385.6

Consolidated

(109.6)

140.5

(0.6)

59.8

(14.0)

(8.5)

67.6

439.0

4.2

(28.2)

482.6

Cash earnings

-

193.9

21.5

6.0

(20.8)

(0.3)

200.3

-

-

-

200.3

Mark to market andother non-

cash -

-

(22.1)

53.8

6.8

(8.2)

30.3

-

-

-

30.3

Associatedcompanies

74.2

-

-

-

-

74.2

-

15.3

(30.9)

58.6

Eliminationsand

capital gains

-

(28.7)

-

-

-

-

(28.7)

323.0

-

-

294.3

Consolidated

74.2

105.2

(10.4)

21.2

(14.0)

(6.7)

169.5

323.0

15.3

(30.9)

476.9

Cash earnings

-

133.9

(1.4)

28.3

(13.0)

(0.5)

147.3

-

-

-

147.3

Mark to market andother non-

cash -

-

(9.0)

(7.1)

(1.0)

(6.2)

(23.3)

-

-

-

(23.3)


Net profit for the year comes to EUR 482.6 million, as against (re-established in accordance with the IFRS) EUR 476.9 million for the previous year. Profit per share amounts to EUR 3.62 (EUR 4.14 for the previous year).

Net income slipped from EUR 170 million as of 31 December 2000 to EUR 68 million in 2001, a decline owed to thenegative contribution of associated companies last year. Cash earnings increased to EUR 200 million (EUR 1.50 per share) as against EUR 147 million (EUR 1.28 per share) one year before.

A. Cash earnings and mark to marketThe large increase (45%) in dividends (EUR 194 million as against EUR 134 million) results from the combined effect ofgrowth in dividends per share from holdings and from GBL’s merger with Electrafina.

Net dividends are primarily composed of those paid by Suez (EUR 67 million), Total Fina Elf (EUR 66 million), RTL Group(EUR 38 million) and Imerys (EUR 15 million). In 2001, Suez dividends included a net amount of EUR 25 million in recoveryof related tax.

The increase in interest income and expenses in cash earnings reflects the improved cash position following the disposal of sharesand the issue of bonds convertible into Suez shares during the second half of 2000 and the first half of 2001. This improvementis partially offset by a drop in average profitability on cash position.

Non-cash elements of interest income and expenses (EUR 22 million in 2001 as against EUR 9 million in 2000) are related tobonds convertible into GBL shares and exchangeable for Suez shares. They correspond to the actuarial depreciation of thedifferential between the nominal interest rate of the loan stock and the prevailing market rate at the time of issue. These amountsare added to the interest actually paid.

The increase in other financial income and expenses is due to the revaluation at market value (EUR 64 million) of optionsissued on Suez shares (included in the exchangeable bonds) and Total Fina Elf shares.

B. Associated companiesGroup share in the current result of associated companies

GBL group share GBL % of earnings(in EUR million)

Bertelsmann (1)

RTL Group (2)

Imerys

Miscellaneous

Total

(1) Bertelsmann consolidated using the equity method with effect from 1 July 2001(2) RTL Group consolidated using the equity method from 1 July 2000 to 30 June 2001. CLT-UFA consolidated using the equity method prior to 30 June 2000

First equity accounting of BertelsmannFurther to the operation on 2 July 2001, whereby GBL transferred its 29.9% holding in RTL Group to Bertelsmann inexchange for a 25.1% stake in the latter, GBL has accounted Bertelsmann using the equity method in place of RTL Groupfrom that date. Within this context, Bertelsmann decided to establish its own accounts in accordance with the IFRS and toadjust its accounting year to match the calendar year.


2000-

41.5

31.8

0.9

74.2

2001(141.6)

12.9

18.6

0.5

(109.6)

200125

27

26

-

2000-

23

26

-


The contribution and the first-time inclusion of Bertelsmann has two important effects on GBL’s accounts:

• Recognition of a contribution gain of EUR 427 million calculated on the basis of a revaluation of 50% of RTL Group sharesat the price of EUR 61.70 per share – the price used by Bertelsmann in its IFRS accounts within the framework of theshare issue in payment for this contribution, and which corresponds to the average of 20 closing prices for RTL Groupshares around the date the final agreements were signed.

• Revaluation of Bertelsmann’s net assets: recognition of a negative goodwill of EUR 164 million on the basis ofBertelsmann’s shareholders’ equity as of 2 July 2001 calculated in compliance with the IFRS at EUR 10.3 billion, andincluding mainly the expected capital gain on the sale price of shares in AOL Inc. and Europe (EUR 4.9 billion). As a resultof this valuation being included in the initial shareholders’ equity, GBL will not take in its earnings its share in the capitalgains realised by Bertelsmann on the actual sale of these shares. The negative goodwill was used in the second half of2001 to cover losses anticipated at the time the operation was concluded.

Bertelsmann’s contribution to GBL’s net earnings for the second half of 2001 breaks down as follows:

GBL group share (in EUR million)

25.1% of Bertelsmann’s net earnings (25.1% x EUR 949 million) 238

Deduction of 25.1% of the capital gains realised on the disposal of AOL Inc. and Europe/others (544)

Carry-over of all GBL negative goodwill 164

Net contribution to GBL’s earnings (142)

Bertelsmann recorded net profits of EUR 949 million for the second half of 2001.This result features capital gains on the sale of assets (EUR 2.2 billion, mainly AOL), restructuring costs, Internet expensesand the impact of 11 September on the evolution in the markets in which the group is active, and does not take account ofthe Summer Shore N.V.’s right to require BMG to purchase its shares in Zomba Record Holdings B.V. and Zomba MusicPublishing B.V., as reflected in the off-balance sheet commitments of Bertelsmann.After extraordinary items, operating expenses, Internet losses and non-recurring expenses, Bertelsmann recorded operatingprofits of EUR 212 million.

Bertelsmann’s net profit (in EUR million)

Earnings before interest, taxes and amortisation of goodwill (1) 1,702

Amortisation of goodwill (570)

Interest expenses (208)

Taxes 7

Minority interests 18

Net profit 949

(1) Earnings before interests, taxes and amortisation of goodwill:

- Divisional result 212

- Corporate / BeCapital (82)

- Internet losses (226)

- Non-recurring expenses (428)

- Capital gains AOL Inc. and Europe 2,081

- Capital gain SportFive 145

1,702



The contribution of ImerysThe contribution of Imerys stands at EUR 19 million, as against EUR 32 million for the previous year, GBL’s group share ofearnings being calculated after an IFRS negative correction of EUR 8 million to Imerys’ net earnings (EUR 79 million)established in respect of the French accounting rules.

In spite of a difficult economic context, Imerys, a world leader in minerals processing, recorded improved turnover and netcurrent income in 2001, thanks to the diversity of its markets, its focus on high added-value products, and the dynamism ofits acquisitions. The group also stepped up its efforts to improve its industrial efficiency and created an extraordinary reserve ofEUR 57 million to this end. The group’s operating income remained stable at EUR 344 million. Net current income, groupshare, grew by 2% to EUR 171 million. Net profit, group share, totalled EUR 79 million, after amortisation of goodwill for anamount of EUR 32 million and a negative net extraordinary result of EUR 60 million.

C. Capital gainsAs of 31 December 2001, the capital gains realised on the sale of Lasmo (EUR 89 million) and the exchange of GBL’s sharein RTL Group for a holding in Bertelsmann (EUR 427 million) are partially offset by an impairment of EUR 86 million onRhodia shares.



GBL Consolidated accounts 55

Consolidated income statement as at 31 December 56

Consolidated balance sheet as at 31 December 57

Cash flow statement 58

Table of changes in shareholders’ equity 59

Notes 60

Report by the Statutory Auditor 84

Supplementary financial data relating to the IFRS consolidated accounts 86

To enable this 2001 annual report to be used as a reference document, this reportcontains three years of accounts as follows:

- accounts prepared in accordance with the IFRS: 1999, 2000 and 2001 balance sheet(at 31 December), 2000 and 2001 income statement and 2000 and 2001 cash flowstatement and table of changes in shareholders’ equity;

- accounts prepared in accordance with the Belgian accounting legislation: 1999 and2000 balance sheet, income statement and cash flow statement.

Consolidated accounts


56 GBL Consolidated accounts

(in EUR million)

Group share of earnings of associated companies (1)

Net profit


Net dividends on financial assets

Gross dividends

Withholding taxes


Financial assets

Current assets

Creditors


Gains on shares and derivatives

Miscellaneous


Earnings on disposals and impairments on financial assets

Taxes

Profit from current operations

Minority interests

Net profit for the year

Earnings per share basic

Earnings per share diluted

(1) Joint ventures

Consolidated income statement as at 31 December

Notes2

3

4

5

6

7

8

10

10

2001(133.6)

(105.4)

(28.2)

140.5

164.2

(23.7)

(0.6)

1.1

42.7

(44.4)

59.8

64.5

(4.7)

(14.0)

439.0

(8.5)

482.6

0.0

482.6

3.62

3.55

200093.7

126.2

(32.5)

127.9

148.8

(20.9)

(4.3)

4.9

29.1

(38.3)

34.3

30.9

3.4

(15.8)

354.5

(6.8)

583.5

(106.6)

476.9

4.14

4.03



(in EUR million)

Non-current assets

Negative goodwill

Tangible assets

Financial assets

Shareholding in associated companies

Other equity investments

Amounts receivable after one year

Deferred tax assets

Current assets

Short-term advances

Investment securities

Cash and near cash

Other current assets

Total assets


Capital

Share premium account

Consolidation reserves

Minority interests

Non-current liabilities

Convertible and exchangeable loans

Other amounts payable after one year

Deferred tax liabilities

Provisions

Current liabilities

Financial debt

Tax liabilities

Derivatives

Other amounts payable

Total liabilities

Consolidated balance sheet as at 31 December

20018,489.7

(616.0)

26.0

9,062.3

2,720.8

6,341.5

0.0

17.4

920.0

0.2

34.6

871.0

14.2

9,409.7

8,526.4

559.8

2,023.3

5,943.3

0.0

789.6

629.0

149.3

4.5

6.8

93.7

4.5

3.5

62.3

23.4

9,409.7

20006,126.7

(421.1)

25.4

6,497.0

2,234.9

4,239.9

22.2

25.4

878.5

0.2

48.9

790.7

38.7

7,005.2

5,112.0

610.8

705.6

3,795.6

902.3

766.6

606.4

149.3

4.2

6.7

224.3

137.2

1.5

59.6

26.0

7,005.2

19995,598.8

(324.2)

1.1

5,890.6

1,178.7

4,582.3

129.6

31.3

1,443.3

0.2

196.5

1,164.5

82.1

7,042.1

4,926.5

610.8

705.6

3,610.1

1,347.6

496.1

357.1

124.0

3.9

11.1

271.9

19.1

7.4

2.6

242.8

7,042.1

Notes

11

12

14

15

26

16

17

18

19, 20, 21

23

24

26

25

27

28



(in EUR million)

Cash flow from current operations

Result before interest and taxes

Adjustment for:

Earnings of associated companies

Dividends received from associated companies

Revaluation to market value

Earnings on disposals and write-downs on long-term investments

Miscellaneous

Interest income and expenses received (paid)

Taxes paid

Change in financial trading instruments

Change in working capital requirement

Cash flow from investment operations

Acquisitions of :

Associated companies, subsidiaries and minority interests

Other tangible and intangible assets

Other financial investments and assets

Amounts received from disposals of tangible and intangible assets

Disposals of financial assets

Deconsolidation of RTL Group (ex-Audiofina)

Amounts received from disposals of other financial investments and assets

Cash flow from funding operations

Dividends paid

Amounts received from loans

Repayment of loans

Net changes in value of GBL’s own shares

Dividends paid to minority interests

Net increase (reduction) in cash and near cash

Cash and near cash at start of financial year

Cash and near cash at end of financial year

Cash flow statement

2001202.3

491.7

133.6

53.4

(64.2)

(439.0)

0.9

(3.5)

(0.3)

48.0

(18.3)

152.2

(254.7)

(0.6)

(0.5)

0.1

385.2

0.0

22.7

(275.6)

(135.3)

22.6

(124.0)

(14.3)

(24.6)

78.9

792.2

871.1

2000218.3

594.6

(93.7)

40.5

(4.3)

(354.5)

0.7

6.6

(0.4)

(21.4)

50.2

(713.2)

(712.8)

(25.8)

(24.3)

0.1

911.4

(862.6)

0.8

100.9

(127.5)

450.7

0.0

(170.4)

(51.9)

(394.0)

1,186.2

792.2



(in EUR million)

Balance as at 31 December 1999

Dividends

Acquisitions of GBL’s own shares

Change in differences on translation



First application of IAS39

Balance as at 1 January 2001

Dividends

Merger

Changes in GBL’s own shares

Acquisitions

Disposals

Market value of financial assets

Disposals of shareholdings

Changes in fair value

Changes in differences on translation



Table of changes in shareholders’ equity

Total

4,926.5

(127.5)

(170.4)

6.5

476.9

5,112.0

2,239.2

7,351.2

(135.3)

1,230.4

(33.2)

18.9

(94.3)

(296.8)

2.9

482.6

8,526.4

Consolidationreserve

3,784.6

(127.5)

-

-

476.9

4,134.0

(31.3)

4,102.7

(135.3)

(251.8)

-

8.8

-

-

-

482.6

4,207.0

GBL’s ownshares

(201.1)

-

(170.4)

-

-

(371.5)

-

(371.5)

-

215.5

(33.2)

10.1

-

-

-

-

(179.1)

Differenceson

translation26.6

-

-

6.5

-

33.1

-

33.1

-

-

-

-

-

-

2.9

-

36.0

Revaluationreserve

0.0

-

-

-

-

0.0

2,270.5

2,270.5

-

-

-

-

(94.3)

(296.8)

-

-

1,879.4

Share premiumaccount

705.6

-

-

-

-

705.6

-

705.6

-

1,317.7

-

-

-

-

-

-

2,023.3

Capitalsubscribed

610.8

-

-

-

-

610.8

-

610.8

-

(51.0)

-

-

-

-

-

-

559.8



1. Accounting principlesThe accounting period covers the 12 months and concern the accounts as at 31 December 2001 drawn up by the Board ofDirectors of 25 March 2002. These accounts will be finalised after approval by the Ordinary General Meeting of shareholders.Figures from the balance sheets of subsidiaries that express their accounts in foreign currencies have been translated at theexchange rates prevailing on the last day of the financial year. Income statement figures have been translated at the averageexchange rates for the year.

Year-end rate Average rate2001 2000 2001 2000

US Dollar 0.88 0.93 0.90 0.92

Canadian Dollar N.A. 1.42 N.A. 1.38

General accounting principles and standardsThe consolidated accounts have been prepared in accordance with the International Financial Reporting Standards (IFRS)published by the International Accounting Standards Board (IASB) and the interpretations of the IFRS published by theInternational Financial Reporting Interpretations Committee of the IASB (IFRIC).

Against a background of internationalisation of financial markets, harmonisation of European accounting standards and withregard to the growing interest among foreign investors, GBL has decided to publish its consolidated accounts for the 2001 and2000 financial years in accordance with IFRS (International Financial Reporting Standards, formerly known as IAS). The IFRSshould enable companies to meet the growing demand for transparency, completeness and comparability of financialinformation. In application of article 8 of the royal decree of 1 September 1986 relating to the annual and consolidatedaccounts of the holding companies, the company has obtained with effect from 11 March 2002 a derogation from theBanking and Financial Commission to apply international standards instead of Belgian standards.

The accounts have been prepared in accordance with the historical cost valuation convention with the exception of certainfinancial instruments, which are stated at their fair value. The financial years are defined in accordance with the commitmentaccounting method.

All significant consolidated and associated companies close their accounts on 31 December. All information required inaccordance with European Union directives 4 and 7 are published.

Application of IAS 39 "Financial instruments: accounting and valuation" in 2001The accounting conventions and principles are the same as those applied for the accounts closed at the end of 2000 except asfollows: with effect from 1 January 2001, the group has applied IAS 39 "Financial instruments: accounting and valuation". As aresult, financial instruments previously stated off the balance sheet are now included under assets and liabilities, and adjustmentsto the fair value of financial assets available for sale are stated in the accounts. The net effect of EUR 2,239.2 million arising fromthese adjustments is accounted for under shareholders’ equity as of 1 January 2001.

Methods and scope of consolidationThe consolidated accounts stated before appropriation of profit include those of GBL and of affiliated companies and jointventures. Together, these constitute the group.

Companies controlledCompanies controlled by the group are fully consolidated. Control is presumed to exist when the group holds more than 50%of the voting rights of a company either directly or indirectly.

The equity method is applied to companies controlled jointly with our group’s partners (joint ventures).

Notes



Intra-group balances and transactions and any resulting potential profits or losses are eliminated.

Newly-acquired companies are consolidated with effect from the effective date of their acquisition in accordance with thepurchase method.

Associated companiesIf the group has a significant influence in a company, the interest it holds in this company is treated as an associatedcompany. The exercise of a significant influence is presumed to exist if the group holds more than 20% of the voting rightseither directly or indirectly.

Positive and negative goodwillThe difference between the acquisition cost and the fair value of net assets acquired is stated in the balance sheet under assets.

Goodwill is amortised using the linear method over a period of 20 years.

Where negative goodwill corresponds with anticipated losses and/or expenses identified in the acquisition plan, which may bereliably estimated while not representing identifiable liabilities on the date of acquisition, this fraction of the negative goodwillis recorded in the accounts under income in the income statement when the future losses and expenses are charged to theaccounts.

Where negative goodwill does not correspond with anticipated losses and/or expenses, it is recorded in the accounts as incomein the income statement as follows:

The amount of negative goodwill not exceeding the fair values of the identifiable non-monetary assets acquired is recorded inthe accounts as income over the average weighted useful life remaining of the depreciable identifiable assets acquired.

Where the majority of the assets acquired are not depreciable, the negative goodwill corresponding with the value of theseassets is held on the balance sheet until the disposal of these non-depreciable assets.

When the majority of the assets acquired are depreciable, the negative goodwill in excess of the fair values of identifiable non-monetary assets acquired is recorded in the accounts immediately as income.

Negative goodwill not released in the income statement is deducted from positive goodwill in the balance sheet under assets.

Tangible assetsTangible assets are recorded in the accounts at their acquisition or production cost, less accumulated and any other specificdepreciation.

Tangible assets are depreciated using the linear method over their estimated useful life.

Investments in associated companiesAssociated companies are recorded in the accounts in the consolidated financial statements using the equity method.

When an investment in a company integrated using the equity method is seen to have fallen in value, the impairmentaccounting rule as described below is applied.



Other equity investmentsOther equity investments recorded under financial assets include investments in companies in which the group does not exercise asignificant influence. This absence of significant influence is presumed if the group does not hold more than 20% of the voting rightseither directly or indirectly. These investments are treated as being shares available for disposal and are initially recorded in theaccounts at acquisition cost. They are revalued to their fair value as the accounts are closed at the end of each financial year.Changes in the fair value of these investments between the end of two financial years are recorded in the accounts undershareholders’ equity.

When an investment is sold, the difference between the net proceeds of the sale and the book value (book value on the date of sale,adjusted by the amount of shareholders’ equity accumulated through periodic revaluations to the fair value of the investment) isrecorded to the credit or debit of the income statement.

Long-term receivablesBonds held and considered as investments to be held to their maturity (subject to the group having the express intention andthe ability to hold them to their maturity) and loans and receivables issued by the group are valued at their amortised cost, i.e. the amount at which they were initially recorded in the accounts plus or minus the accumulated amortisation of anydifference between this initial amount and the amount at maturity, and minus any amounts written down for depreciation ornon-recoverability.

Other current financial assetsDerivatives considered to be held for trading purposes are initially recorded in the accounts at cost, i.e. the fair value of theconsideration given in exchange. After their initial accounting, the derivatives are valued at their fair value at the end of each financialyear. Changes in their fair value between the end of two financial years are recorded in the accounts in the income statement.

Bonds considered as investments to be held to their maturity (subject to the group having the express intention and the ability to holdthem to their maturity) and loans and receivables issued by the group are valued at their amortised cost, i.e. the amount at whichthey were initially recorded in the accounts plus or minus the accumulated amortisation of any difference between this initial amountand the amount at maturity, and minus any amounts written down for depreciation or non-recoverability.

Other financial instruments are initially recorded in the accounts at cost and then revalued to their fair value at the end of eachfinancial year. Changes in the fair value of these financial instruments between the end of two financial years are recorded in theaccounts in the income statement.

Impairment of assetsThe book values of the group’s assets other than taxes are re-examined at the end of each financial year to determine whetherthey have fallen. Should this appear to be the case, an estimation is made of the amount recoverable from the asset, which is thehighest amount between the net realisable value of the asset and its useful value, corresponding to the present value of the futureanticipated cash flow.

Impairment of assets previously recorded in the accounts are written back if the estimations of the recoverable value of the assetsreveal changes. However, the book value of an asset after a previously recorded impairment has been written back may notexceed the net book value which would have been calculated if no impairments had been made during the course of previousfinancial years. Impairments of goodwill may not be written back unless they have been caused by specific exceptional external events whichare unlikely to be repeated and unless the increase in the recoverable amount serves clearly to cancel out the effect of thisspecific event.



TaxesTaxes payable on profit for the financial year include both current and deferred taxes. They are recorded in the incomestatement unless they relate to recorded items directly related to shareholders’ equity, in which case they also are recorded inthe accounts under shareholders’ equity.

Current taxes are the taxes to be paid on the taxable profit for the financial year, calculated in accordance with the tax rates in forceor in the process of coming into force on the last day of the financial year, plus adjustments relating to previous financial years.

Deferred taxes are calculated in accordance with the variable carry-over method applied to the temporary differences betweenthe book values of the assets and liabilities recorded in the balance sheet and their tax basis.The following differences are disregarded: non-tax-deductible goodwill and initial valuations of assets and liabilities notaffecting the book or taxable profit.Deferred taxes are calculated according to the manner in which the assets and liabilities items are expected to be realised orsettled, based on the tax rates in force or in the process of coming into force on the last day of the financial year. Recoverable deferred taxes in respect of investments in subsidiaries are not recorded in the accounts if the group is able tocontrol the date on which the temporary difference will reverse and if the group does not expect the temporary difference toreverse within a foreseeable future.Deferred taxes (payable) are recorded in the accounts if the taxable profits are likely to materialise in such a manner as toallow them to be offset against tax losses and credits. Deferred taxes payable are not recorded in the accounts if it becomesunlikely that the taxable profits against which they could be offset will be realised.

Cash and near cashCash comprises current account balances.Near cash includes bank deposits and investments with a maturity date of no more than three months from the date ofacquisition; those with maturity dates in excess of three months are classified as short-term investments.

Negotiable securities held until their maturity dates are valued at their amortised cost, while those held for trading purposesare valued at their fair value at the end of the financial year. Profits and losses on these securities are recorded in the incomestatement.

GBL’s own sharesWhen GBL’s own shares are bought or sold by GBL, the amount paid or received, inclusive of directly attributable charges, isapplied as a reduction or increase in shareholders’ equity. Movements in respect of these shares are shown in the changes inshareholders’ equity table. No profits or losses on these movements are recorded in the income statement.

Appropriation of profitThe dividends paid by GBL to its shareholders are mentioned in deduction of shareholders’ equity for their gross amount, i.e.before withholding tax.

Pensions and similar obligationsThe company’s commitments for defined pensions and similar obligations are valued using the Project Unit Credit method inconformity with the principles of IAS 19 (revised in 2000).

If the fair value of the assets of the pension scheme assets exceeds the amount of its commitments, the assets recorded in theaccounts are limited to the present value of all economic benefits in the form of repayments under the scheme or a reductionof future contributions to the scheme. Actuarial differences and past service costs are recorded immediately.



ProvisionsProvisions are recorded in the accounts at the end of the financial year when a group company has a legal or implicitobligation resulting from a past event, when it is probable that an amount will have to be paid out to meet this obligation andif the amount of the obligation can reliably be determined.

The amount recorded as a provision corresponds to the most accurate possible estimation of the expenditure required toliquidate the obligation existing on the last day of the financial year.

Provisions for restructuring are not recorded in the accounts unless the group has approved a detailed and formal restructuringplan and the restructuring has either begun or been announced publicly. Costs relating to the group’s current operations arenot taken into account.

Long-term debtLong-term debt comprise bank loans and bonds. They are initially recorded in the accounts at their fair value received inexchange, minus transaction costs, after which they are valued at their amortised cost (initial amount less repayments ofprincipal plus or minus the cumulative amortisation of any difference between the initial amount and their value on maturity).

Short-term debt Short-term debt comprise bank advances and bonds. They are initially recorded in the accounts at their fair value received inexchange, minus transaction costs, after which they are valued at their amortised cost (initial amount less repayments ofprincipal plus or minus the cumulative amortisation of any difference between the initial amount and their value on maturity).

DerivativesThe derivatives financial instruments, which are initially recorded in the accounts at cost, then revalued at their fair value atthe end of each financial year. Changes in the fair value of these financial instruments between the end of two financial yearsare recorded in the accounts in the income statement.

Items denominated in foreign currenciesAssets and liabilities in the accounts of group companies denominated in foreign currencies are translated into euro at theexchange rates of the last day of the financial year. Unrealised translation differences appearing as a result of the applicationof this principle are recorded as gains and losses for the year. Non-monetary assets and liabilities are recorded in the accountsusing the exchange rates applicable on the date of the transaction.

In the consolidated accounts, translation differences on the shareholders’ equity of fully consolidated companies andcompanies consolidated using the equity method are not recorded in the income statement for the year but are carried toshareholders’ equity under the "Differences on translation" heading. Gains and losses headings in foreign currencies aretranslated into euro at the average exchange rates for the financial year. Differences on translation arising from the differencebetween average rates and year-end rates are carried to shareholders’ equity under the "Differences on translation" heading.

InterestThe interest income and expenses comprise interest to be paid on loans and interest to be received on deposits. Interestincome received is recorded prorata temporis in the income statement, taking into account the effective interest rate on thedeposit.



DividendsDividends relating to financial assets or investment bonds are recorded in the accounts on the date on which their distributionis decided. The amount of withholding tax is recorded in the accounts as a deduction against gross dividends.

Information by sectorBy virtue of the company’s activities as a holding company, it is not possible to present information by sector of operationor geographical area. However, it is possible for readers of the financial statements to find this information with respect tocompanies in which GBL holds an interest in the chapter relating to investments and also in their financial statements.

2. Group share of earnings of associated companiesAnalysis of contributions by associated company:

(in EUR million)

Bertelsmann

RTL Group / CLT-UFA

Imerys

Miscellaneous

Group share of earnings

RTL Group / CLT-UFA

Imerys


On 31 December 2001, the GBL share in the net loss of Bertelsmann included a write-back of negative goodwill of EUR 164.5 million. This negative goodwill corresponds to operating losses identified at the time when the investment wasacquired. It is also important to note that the capital gains realised by Bertelsmann on the sale of AOL Europe and Inc. sharesare not recorded in GBL’s profit and loss accounts because these shares had been revalued at their fair value on the date ofthe acquisition (the contribution is detailed in the economic summary page 53).

3. Gross dividends on financial assetsAnalysis of contribution by investment:

(in EUR million)

Suez

Total Fina Elf

Miscellaneous

Total

In 2001, dividends received from Suez include a gross amount of EUR 30.2 millions (EUR 28.6 million in 2000) relating totax refunds.

2001(141.6)

17.1

18.6

0.5

(105.4)

(26.0)

(2.2)

(28.2)

200178.5

77.5

8.2

164.2

2000-

95.5

29.9

0.8

126.2

(30.4)

(2.1)

(32.5)

200082.9

57.0

8.9

148.8



4. Interest expenses on debt(in EUR million)

Interest on convertible and exchangeable loans

Convertible into GBL shares

Exchangeable for Suez shares

Interest on financial debts payable over one year

Interest on debts payable within one year

Total

Interests on convertible and exchangeable loans relate to the financial instruments described in note 23. It includes an amount ofEUR 22.6 million (EUR 9.0 million in 2000) in respect of an actuarial amortisation of the difference between the nominal interestrate of the loan and the market rate prevailing on the date of issue. This amount is added to the interest actually paid.

5. Gains on shares and derivatives(in EUR million)

Dividends

Losses and capital gains on sales

Losses and capital gains on revaluation

Total

Capital gains on revaluation in 2001 include latent capital gains taken to the income statement on the revaluation to market value at the end of the financial year of Suez options relating to the exchangeable securities described in note 23 (EUR 54.5 million) and call and put options on Total Fina Elf shares issued by the group (EUR 9.1 million) referred to in note 29. These revaluations are not permanent and depend upon the Suez and Total Fina Elf share price and can’t becompared to the gains or losses on revaluations of 2000 owing to the first application of the IAS 39 in 2001.Most of the losses and capital gains realised in 2000 related to the sale of trading shares by the Audiofina group.

6. Other operating income and expenses(in EUR million)

Income from services rendered

Other income

Other operating income

Sundry goods and services

Personal costs

Depreciation

Miscellaneous

Other operating expenses

Average number of employees

Parent company


2001(35.9)

(11.7)

(24.2)

(6.5)

(2.0)

(44.4)

20010.3

0.0

64.2

64.5

20010.1

1.3

1.4

(10.5)

(3.5)

(1.3)

(0.1)

(15.4)

200115

37

2000(16.3)

(11.3)

(5.0)

(13.5)

(8.5)

(38.3)

20001.0

31.4

(1.5)

30.9

20002.1

1.5

3.6

(14.6)

(3.7)

(1.0)

(0.1)

(19.4)

20008

38



Personal costs

(in EUR million)

Remuneration

Social security

Contributions to defined benefit pension plans

Miscellaneous

Total

Remuneration paid to members of administrative and management bodies in respect of the 2001and 2000 financial years

(in EUR million)

Consolidated companies:

Total remuneration paid for the financial year to Directors of the parent company in respect of

their function in the parent company, its subsidiaries and associated companies:

Total net amount of remuneration paid for the financial year to members

of the General Management Committee by the parent company, its

subsidiaries and associated companies:

Parent company:

Direct and indirect remuneration and pensions paid to Directors

chargeable to the income statement, subject to this declaration not

relating exclusively or primarily to the situation of one single identifiable person:

7. Earnings on disposals and impairments on financial assets(in EUR million)

Lasmo

RTL Group

Audiofina

Total Fina Elf

ING

Suez

Cometra Energy (Canada)

Miscellaneous

Capital gain or loss on disposal of subsidiaries and financial assets

Rhodia

Lasmo

Pioneer

Gillam / RCF

Miscellaneous

Impairments and reinstatement of impairments

Total

2001(2.3)

(0.7)

(0.4)

(0.1)

(3.5)

2001

4.8

5.2

4.0

200189.0

427.2

-

-

-

7.4

-

1.2

524.8

(86.1)

-

-

-

0.3

(85.8)

439.0

2000(2.5)

(0.8)

(0.3)

(0.1)

(3.7)

2000

4.3

4.8

3.5

2000-

-

152.3

56.2

55.7

39.1

14.0

(1.1)

316.2

-

26.5

9.0

2.0

0.8

38.3

354.5



8. Taxes(in EUR million)

Current taxes:

- domestic

- foreign

Subtotal

Deferred taxes:

- for the financial year

- attributable to a change in tax rate

Subtotal

Total tax relating to GBL and its subsidiaries

Deferred taxes relate to a theoretical calculation and not to cash flow.

(in EUR million)

Profit before tax

Taxes at Belgian rate

Profit from companies consolidated using the equity method

Permanent differences

Change in deferred taxes due to a change of tax rate

Taxes on another basis than the result

Effect of rates applicable in other jurisdictions

Effective charges and tax rates for the financial year

9. DividendsA gross dividend of EUR 1.20 per share (EUR 1.10 in 2000) was paid to shareholders on 19 June 2001.

The Board of Directors will propose a gross dividend of EUR 1.32 per share in respect of the 2001 financial year, to be paidwith effect from 17 May 2002. These financial statements presented before appropriation of profit do not reflect this dividend,which is subject to approval by the shareholders at the General Meeting to be held on 23 April 2002.

If this proposal is approved, the total dividend to be paid to 138,300,053 shares amounts to EUR 182.6 million.

2001

0.0

0.3

0.3

8.0

0.2

8.2

8.5

2000

0.4

0.2

0.6

6.2

0.0

6.2

6.8

491.1

197.3

53.6

(241.8)

0.2

0.3

(1.1)

8.5

40.17%

1.73%



10. Earnings per shareThe earnings per share basic and diluted are based on the following data:

Profit

(in EUR million)

Net profit used to determine the basic earnings per share

Influence of diluting financial instruments:

Interest on convertible loans (net of taxes)

Net profit used to determine the diluted earnings per share

Number of shares

Shares in issue

GBL’s own shares convertible

others at start of year

weighted changes during the year

Weighted average number of shares used to determine the basic earnings per share

Influence of diluting financial instruments

Convertible loans (note 23)

Options on shares (note 22)

Weighted average number of shares used to determine the diluted earnings per share

Due to the merger of 2001, the number of GBL shares was multiplied by 5. This transaction has been taken into account inthe calculation of the weighted average number of shares in 2001 and 2000.

2001482.6

11.7

494.3

2001138,300,053

(4,999,238)

0

(126,812)

133,174,003

4,907,143

1,248,250

139,329,396

2000476.9

11.3

488.2

2000

122,160,125

(4,999,635)

(1,248,250)

(812,098)

115,100,142

4,907,143

1,248,250

121,255,535



11. Negative goodwill

(in EUR million)

Gross value

Amounts used

Net negative goodwill

Negative goodwill relates entirely to successive purchases of Electrafina shares. Additions during the financial year (EUR 500.2 million) were due to the merger carried out on 26 April 2001, treated in the consolidated accounts as theacquisition by GBL of 17.2% of Electrafina. The acquisition cost is estimated at EUR 1,230.4 million (see page 59, tableof changes in shareholders’ equity).

Because the majority of Electrafina’s assets are non-depreciable financial assets, the negative goodwill generated on these acquisitions is recorded in the income statement on the subsequent sale of the revalued assets. In 2001, an amountof EUR 6.5 million was released on the sale of Lasmo and EUR 3.8 million on the sale of Suez shares. Goodwill of EUR 295.0 million was released on the exchange of the investment in RTL Group for an interest in Bertelsmann. Given the revaluation of RTL Group shares by 50%, half of the negative goodwill used is recorded as a capital gain and the other half is used in the determination of the entry value of the BAG shares. The total amount used during the financialyear 2001 amounts to EUR 305.3 million.

12. Tangible assets

(in EUR million)

a. Acquisition cost

Closing balance at end of last year

Acquisitions

Sales

Differences on translation

Closing balance at end of this year

b. Accumulated depreciation

Closing balance at end of last year

Changes during the year

Cancellation on sale

Closing balance at end of this year

c. Net book value at the end of this year (a – b)

At the end of the previous year

2001

1,132.1

(516.1)

616.0

Land andbuildings

0.2

-

(0.2)

-

0.0

0.1

-

(0.1)

0.0

0.0

0.1

Used during the year

-

(305.3)

(305.3)

Other tangible

assets

25.3

-

-

1.4

26.7

0.9

0.7

-

1.6

25.1

24.4

Additions duringthe year

500.2

-

500.2

Furniture andvehicles

2.7

0.4

(0.3)

-

2.8

1.8

0.4

(0.3)

1.9

0.9

0.9

2000

631.9

(210.8)

421.1

Total

28.2

0.4

(0.5)

1.4

29.5

2.8

1.1

(0.4)

3.5

26.0

25.4



13. SubsidiariesName

GBL

Belgian Securities B.V.

Brussels Securities

G.B.L. Coordination Center

GBL Finance S.A. Holding

Sagerpar

Interenergy Investment Corporation

GBL Overseas Finance N.V.

Electrafina group

Cometra Oil & Gas B.V.

Interenergy Investment Corporation

Audiofina group (1)

(1) Deconsolidated on 30 June 2000 on the creation of RTL Group, which is consolidated using the equity method

14. Associated companies

(in EUR million)

Balance on 31 December 2000

Entrance into the scope of consolidation

Earnings for the year

Appropriations for the year

Dividend

Differences on translation

Change in percentage consolidated

Exit from the scope of consolidation

Miscellaneous


Negative goodwill of EUR 164.5 million was generated on the first consolidation of Bertelsmann. This negative goodwill hasbeen charged fully to the income statement under the GBL group share of Bertelsmann’s net profit for the second half of2001, because it relates to losses recognised and identified when this investment was acquired.

% of shares held

Share in the equity ofassociated companies

1,537.2

2,592.5

(269.9)

-

(53.3)

(2.4)

(0.4)

(1,125.2)

4.4

2,682.9

Registered office

Amsterdam

Brussels

Brussels

Luxembourg

Brussels

Luxembourg

Curaçao

Amsterdam

Luxembourg

Luxembourg

% of voting rights

Goodwill

697.7

(164.5)

164.5

(28.2)

-

-

301.6

(933.2)

-

37.9

Main activity

Holding company

Holding company

Coordination

centre

Holding company

Holding company

Holding company

Holding company

Holding company

Holding company

Holding company

Media

Total

2,234.9

2,428.0

(105.4)

(28.2)

(53.3)

(2.4)

301.2

(2,058.4)

4.4

2,720.8

2001

100.0

100.0

100.0

100.0

100.0

100.0

100.0

-

-

-

-

2000

100.0

100.0

100.0

100.0

100.0

-

100.0

82.8

100.0

100.0

-

2001

100.0

100.0

100.0

100.0

100.0

100.0

100.0

-

-

-

-

2000

100.0

100.0

100.0

100.0

100.0

-

100.0

82.8

100.0

100.0

-



List of associated companiesName

Bertelsmann AG (from 1 July 2001)

Imerys

RTL Group (until 30 June 2001)

CLT-UFA Holding (until 30 June 2000)

SFPG (until 30 September 2001)

15. Other equity investments(in EUR million)

TotalFina Elf

Suez

Rhodia

Lasmo

Miscellaneous

Total market value

Investments held in quoted companies are valued using their market price.

Changes during the financial year(in EUR million)

On 1 January 2001

- Acquisition value 4,239.9

- Adjustment to previous year following adoption of IAS 39 2,270.5

After adjustment (market value on 1 January 2001) 6,510.4

Disposals (353.1)

Acquisitions 10.3

Revaluations on merger 553.5

Write-downs (87.2)

Change in market value (292.4)

Market value on 31 December 2001 6,341.5

Details of revaluations of investments are given in note 20.

% of shares heldRegistered office

Gütersloh

Paris

Luxembourg

Luxembourg

Paris

% of voting rights

20013,767.7

2,463.6

85.8

0.0

24.4

6,341.5

Main activity

Media

Mineral

processing

Media

Holding company

Holding company

20002,217.4

1,612.7

171.9

212.7

25.2

4,239.9

200125.1

26.3

26.9

-

46.1

2000-

26.2

26.9

50.0

46.1

200125.0

20.5

26.9

-

46.1

2000-

34.0

26.9

50.0

46.1



16. Investment securities(in EUR million)

Shares

Deposits and bonds

Miscellaneous

Total market value

Share investments include among others 11,500 Pargesa shares with a market value of EUR 25 million. These shares areheld to cover the exercise of the options described in note 22.

Investment securities are valued using their market prices.

17. Cash and near cash(in EUR million)

Deposits

Bonds

Miscellaneous

Total market value

18. CapitalIssued capitalThe fully-paid share capital as at 31 December 2001 was EUR 559,802,625.54, represented by 138,300,053 shareswithout nominal value.All shares have the same rights.In accordance with article 28 of the Company’s articles of association, each share carries an entitlement to one vote.GBL has not issued any other class of shares such as non-voting or preference shares.

Number of shares in issueIssued on 1 January

Cancellation of GBL’s own shares

Merger with Electrafina (retroactive to 1 January 2001)

Issued on 31 December

The number of GBL shares was multiplied by 5 during the 2001 financial year; the comparative figures for 2000 have beenadjusted.

Capital structure: Number of sharesRegistered 71,937,070

Bearer 66,362,983

200128.3

6.0

0.3

34.6

200176.5

791.9

2.6

871.0

2001122,160,125

(4,360,095)

20,500,023

138,300,053

200039.2

6.0

3.7

48.9

2000125.0

642.3

23.4

790.7

2000122,160,125

-

-

122,160,125



Authorised capitalThe Extraordinary General Meeting held on 25 May 1999 renewed the authorisation granted to the Board of Directors for aperiod of 5 years to:- increase the capital, in one or more tranches, up to a total value of EUR 125 million;- decide to issue one or more tranch(es) of bonds convertible into shares or subscription rights or other securities carrying

future rights to shares in the company up to a total value such that the capital increases that may be issued through theexercise of subscription rights or conversion rights attached to the bonds does not result in the total capital exceeding theabove authorised limit.

In either case, the Board of Directors may, in the interests of the company, restrict or cancel shareholders’ preferentialsubscription rights in conformity with the terms and conditions laid down by law.

This authorisation, first granted in 1987, was renewed on 25 May 1993, 28 May 1996 and 25 May 1999, and remainsvalid for a period of five years with effect from 19 June 1999, i.e. until June 2004. As of 31 December 2001, the Board ofDirectors had not availed itself of this power thus granted to it. Thus the authorised capital remains at EUR 125 million, i.e. a maximum of 30,881,431 shares based on the capital as at 31 December 2001.

The Board of Directors is also authorised to increase the capital in return for contributions in kind or contributions in cash,restricting or cancelling shareholders’ preferential subscription rights in the event of a public takeover offer.

Capital increases made by virtue of this authorisation will be booked against the remaining amount of authorised capital.This authorisation is valid for a period of 3 years with effect from 26 April 2001, i.e. to April 2004.

Capital history of GBL (formerly Electrafina) since 1 January 1999Date

1/1/99

31/12/99

26/4/01

26/4/01

26/4/01

Situation at 31 December 2001

(1) Witnessed by notarised deed dated 12 January 2000(2) Capital reduction to increase the ordinary reserve with a view to the partial reconstitution of the company’s ability to pay dividends, greatly reduced further to the cancellation of

GBL’s own shares

Change

Situation at this date

Redemption of 12,654 bonds redeemable in shares (1)

Division of Electrafina share by 3

Capital increase following the absorption of Groupe

Bruxelles Lambert S.A. and change of company

name to Groupe Bruxelles Lambert

Capital reduction (2)

Capital in EUR

358,770,309.12

114,320.76

-

610,800,625.00

(409,882,629.34)

559,802,625.54

Number of sharesissued

39,711,768

12,654

79,448,844

117,800,030

(98,673,243)

138,300,053



19. GBL’s own sharesThis entry comprises the purchase cost of GBL shares held by group companies. At the end of the 2001 financial year, the group held 5,310,143 shares, 4,999,238 of which are intended for the repayment of convertible bonds in the event oftheir holders deciding to exercise their conversion option (see note 23).

Shares held on 31 December 2000 9,359,730

Cancellation via the merger (4,360,095)

Repayment of convertible bonds (397)

Acquisitions during the year 595,712

Disposals during the year (284,807)

Shares held on 31 December 2001 5,310,143

20. Revaluation reserves(in EUR million)

Balance on 1 January 2001

Balance prior to adjustment

First application of IAS 39

After adjustment

Cancellation on disposal

Change in market value

At 31 December 2001

Revaluation reserves relate to the difference between the book value and market value of "other equity investments" detailed innote 15.

21. Differences on translation(in EUR million)

Balance on 1 January 2001

Additions during the year

Change in scope of consolidation

At 31 December 2001

Lasmo

0.0

84.8

84.8

(84.8)

0.0

0.0

Imerys31.2

6.9

-

38.1

Rhodia

0.0

(14.3)

(14.3)

0.0

14.3

0.0

Bertelsmann0.0

(5.9)

-

(5.9)

Total Fina Elf

0.0

1,233.8

1,233.8

0.0

46.8

1,280.6

RTL Group(0.4)

(3.5)

3.9

0.0

Suez

0.0

965.0

965.0

(8.6)

(352.9)

603.5

Miscellaneous

0.0

1.2

1.2

(0.9)

(5.0)

(4.7)

Miscellaneous2.3

1.5

-

3.8

Total

0.0

2,270.5

2,270.5

(94.3)

(296.8)

1,879.4

Total33.1

(1.0)

3.9

36.0



2000

2001

2002

2003

2005

GBL43,000

40,000

321,312

281,313

562,625

1,248,250

Pargesa1,000

1,000

3,125

2,125

4,250

11,500

22. Employee profit-sharing schemeA profit-sharing scheme was set up in 1999, covering 249,650 GBL’s own shares and 11,500 Pargesa shares, subscribed byemployees of GBL and its Belgian subsidiaries and directors of GBL exercising real and permanent functions within GBL. The issue of these options forms part of the profit-sharing plan to be operated by GBL and its subsidiaries for the next tenyears, a period which corresponds with the term of the options.

Taking into account the exchange rate of 5 GBL shares for 1 GBL S.A. share resulting from the merger by absorption of GBL byElectrafina, the share option scheme now covers 1,248,250 GBL shares.

The GBL option exercise price (one option carries the right to 5 shares) was fixed at EUR 163.9 per share in 1999, the quotedprice at the close of stock exchange trading on the day preceding the offer. The Pargesa option exercise price was fixed at CHF 2,338.2 per share, the average quoted price during the 30 days preceding the offer. The terms of the issue complied withthe provisions of the Act of 26 March 1999 relating to the 1998 Belgian employment action plan covering various arrangements.

In accordance with the plan, these options may not be exercised until 1 January 2003.

Date of offer Vested from Number of shares corresponding to the options issued

30 June 1999

30 June 1999

30 June 1999

30 June 1999

30 June 1999

Total

679,000 of the 1,248,250 shares corresponding to the shares issued were attributed to the members of the GeneralManagement Committee.

Accounting methodsGBL share optionsGBL share options are not recorded in the consolidated accounts.

Pargesa share optionsThe Pargesa shares intended to cover the options issued are held by GBL and recorded in the accounts under cash deposits.The options are recorded in the balance sheet under liabilities.The options and shares are revalued to their market value at the end of each financial year via the income statement.



23. Convertible bonds(in EUR million)

Face value of loan stocks issued

Including options

Debt component on date of issue

Cumulative interest at 31 December 2000


Interest of the financial year


Loan stock convertible into GBL sharesThe loan stock convertible into GBL shares was issued on 9 July 1998 and is guaranteed by 4,999,635 GBL’s own shares tobe allocated to bondholders deciding to exercise their conversion option. The bonds are convertible at any time between theirissue and maturity date.

During the 2001 financial year, the exercise of conversion options resulted in a redemption by the allocation of 397 existingGBL shares.

Should the conversion option not be exercised, the loan stock will be redeemed at face value on 9 July 2003. The loan stockcarries an annual interest rate of 2.5% payable until conversion.

The funds raised through the issue of this convertible loan stock were divided into a debt component and a shareholders’equity component. The shareholders’ equity component represents the market value of the conversion option included in theloan stock on the issue date. The amounts mentioned in the table above are stated after the elimination of 10,000 convertiblebonds with a face value of EUR 5.1 million held by a 100% GBL subsidiary.

Loan stock exchangeable for Suez sharesIn autumn 2000, GBL made two issues of bonds exchangeable for Suez shares. These two tranches are guaranteed by Suezshares held by GBL until the maturity or exercise of the bondholders. They have the following characteristics:

Face value

Issue date

Term

Nominal interest rate

Number of Suez shares to be allocated if all options are exercised

If the conversion options aren’t exercised, the loan stocks will be reimbursed at face value.

GBL convertible252.0

(26.1)

225.9

12.3

238.2

5.2

243.4

Tranche 1EUR 208 million

10 October 2000

3 years

1.00%

5 million

Suez exchangeable418.0

(53.7)

364.3

3.9

368.2

17.4

385.6

Total670.0

(79.8)

590.2

16.2

606.4

22.6

629.0

Tranche 2EUR 210 million

31 October 2000

4 years

1.75%

5 million



The funds raised through these exchangeable loan stock issues have been divided into a long-term debt component and aderivative component recorded in the accounts under current liabilities. The component recorded in the accounts under currentliabilities represents the market value of the purchase options included in the loan stocks on their issue dates. This lastcomponent is revalued to its market value at the end of each financial year via the income statement.

24. Other amounts payable after one year

(in EUR million)

USD bank loan

EUR bank loan

Total

25. Financial debts payable within one year(in EUR million)

Debts payable over one year maturing during the year

Loan stock

Bank loan

Miscellaneous

Total

26. Deferred taxes(in EUR million)

Deferred tax liabilities

Deferred tax assets

Net position on 31 December

Changes in group net deferred taxes position:(in EUR million)

On 1 January

Recorded in income statement for the year

Effect of rate change

On 31 December

Nominalinterest rate

3.70%

3.78%

Maturity date

-

2004

Starting date2000

1999

2001

25.3

124.0

149.3

2001

0.0

0.0

4.5

4.5

2001(4.5)

17.4

12.9

200121.2

(8.1)

(0.2)

12.9

2000

25.3

124.0

149.3

2000

124.0

0.0

13.2

137.2

2000(4.2)

25.4

21.2

200027.4

(6.2)

-

21.2



The main sources of deferred taxes and changes during the year:Deferred tax liabilities

(in EUR million) Associated companiesOn 1 January 2001


On 31 December 2001

Deferred tax assets

(in EUR million)

On 1 January 2001


Effect of rate change

On 31 December 2001

As at 31 December 2001, unused tax losses able to be carried forward by the group amounts to EUR 49.1 million (EUR 70.8 million on 31 December 2000). Deferred tax assets have been acknowledged in respect of the whole of these losses.

27. Derivatives(in EUR million)

Share options

Suez

Total Fina Elf

Pargesa

Pioneer

Miscellaneous

Total

In application of IAS 39, options are estimated at their market value via the income statement with effect from 1 January 2001. Previous revaluations have been taken to reserves.

Suez share options relate mainly to exchangeable loan stock issues described in note 23. The Pargesa share options are thoseallocated to employees as described in note 22. Details of Total Fina Elf share options are given in note 29.

200162.0

30.5

23.4

7.4

0.7

0.3

62.3

(4.2)

(0.3)

(4.5)

Tax losses25.4

(7.8)

(0.2)

17.4

200058.7

54.5

3.1

0.0

1.1

0.9

59.6



28. Other amounts payable within one year(in EUR million)

Trade debts

Taxes, remuneration and social security

Interest incurred and not yet paid

Miscellaneous

Total

29. Rights and commitments not shown on the balance sheet(in EUR million)

Guarantees given by third parties on behalf of the group

Guarantees given on behalf of third parties

Loans issued by Belgian Securities

Miscellaneous

Guarantees related to issue of bearer certificates

Investment and divestment commitments

Investment commitments

Divestment commitments

Foreign currency term markets

Put and call options issued

Interest swaps concluded

Caps, floors and collars issued

Swap options

Miscellaneous

Financial instruments employedGBL group uses financial derivatives instruments within strict limits to improve treasury profitability and are estimated at theirmarket value. Such transactions are recorded under the rights and commitments not shown on the balance sheet at their facevalues; this does not reflect the risks of ongoing transactions, which are a small percentage of the face values. Overall,transactions maturing during the 2001 financial year were highly profitable, contributing to a significant improvement in theprofitability of treasury operations.

Investment commitmentsInvestment commitments as at 31 December 2001 relate essentially to the PAI Europe III fund, in which GBL has agreed toinvest EUR 40 million, EUR 9.9 million has already been subscribed in 2001. As at 31 December 2000, this also related tothe price for the purchase of the RTL Group shares still held by BNP Paribas (2.8%).

20010.6

0.5

7.9

14.4

23.4

20010.3

0.1

-

0.1

0.1

45.8

40.8

5.0

-

959.5

-

-

172.7

10.6

20000.1

0.6

10.7

14.6

26.0

20000.3

8.8

8.7

0.1

2.1

238.4

238.4

-

150.5

535.5

249.7

149.2

-

11.2


Put and call options issuedPut and call options existing as at 31 December 2001 comprise the call options for Suez shares included in the exchangeableloan stock described in note 23 (EUR 418.0 million) and put and call options for Total Fina Elf shares. The call options forSuez shares also comprise the majority of the options existing as at 31 December 2000. The options for Total Fina Elf shareswere issued by GBL during the second half of 2001 and mature in the second half of 2002. It concerns the sale of calloptions relating to 1,600,000 Total Fina Elf shares representing a face value of EUR 281.1 million and put options alsorelating to 1,600,000 Total Fina Elf shares representing a face value of EUR 230.0 million.

RTL Group litigationA number of RTL Group minority shareholders sued GBL, Bertelsmann, RTL Group and the Directors of RTL Grouprepresenting GBL and Bertelsmann in the Luxembourg courts in 2001 for cancellation of the transfer by GBL of RTL Groupshares to Bertelsmann and entered a subsidiary claim for indemnification of their alleged prejudice.

The summary proceedings initiated by these minority shareholders was declared inadmissible. An appeal has been enteredagainst this decision.

30. Pensions and similar obligationsThe majority of GBL group employees are members of a defined benefit pension plan financed by a pension fund and a groupinsurance policy.

GBL group adopted IAS 19 (revised in 2000) with effect from 1 January 1999. Due to the asset ceiling, the application of IAS 19 had no immediate effect.

The commitments related to the pension plan as at 31 December 2001 were:

Present value of funded obligations

Fair value of plan assets

Unrecognised actuarial losses

Unrecognised past service cost

Effect of the asset ceiling

Amount recorded on the balance sheet

The pension scheme’s assets include shares issued by GBL group with a value of EUR 0.4 million (EUR 0.5 million in 2000).


200133.8

(57.2)

(23.4)

0.0

0.0

23.4

0.0

200033.4

(63.1)

(29.7)

0.0

0.0

29.7

0.0


The net charge for 2001 was EUR 0.8 million (EUR 0.6 million in 2000):

Current service cost

Interest costs

Expected return on plan assets

Net actuarial losses

Past service cost

Effect of the asset ceiling

Net charge

The net charge is recorded under the heading "Remuneration, social security and pension costs" and "Sundry goods and services".

The true return on the covering assets in 2001 was EUR - 4.6 million (EUR - 0.8 million in 2000).

The change in the amounts recorded in the accounts is explained in the following table:

Amount recorded in the accounts as at 1 January

Net charge

Contributions paid

Amount recorded in the accounts as at 31 December

The main actuarial assumptions are as follows:

Discount rate

Expected return on plan assets

Expected rate of salary increases

Inflation rate

31. Transactions with related partyAssociated companies(in EUR million)

Financial assets – other equity investments

Investment securities

Financial debts payable within one year

Derivatives issued

Net dividends from financial assets

Interest expenses on debt

The amounts stated under "Investment securities" and "Derivatives issued" relate to the options on Pargesa shares described innote 22 and to the shares held to be delivered in case of exercise of these options.


20010.5

1.9

(4.5)

9.2

0.0

(6.3)

0.8

20010.0

0.8

(0.8)

0.0

20015.50%

7.00%

5.50%

2.50%

20000.6

2.0

(4.9)

4.5

0.0

(1.6)

0.6

20000.0

0.6

(0.6)

0.0

20005.75%

7.25%

5.75%

2.75%

2.7

25.4

4.5

7.4

0.6

(0.1)



Remuneration of Directors and General Management Committee membersDetails of remuneration paid and options on GBL shares allocated to Directors and General Management Committee membersare respectively given in note 6 and 22.

Number of the issuer’s shares held by members of its administrative, management and supervisory bodiesMembers of the Board of Directors hold a total of 500 GBL registered shares.



Report of the Statutory Auditor to the Annual General Meeting of shareholders on theconsolidated accounts for the year ending on 31 December 2001

To the shareholders,

In accordance with the legal and statutory requirements, we report on our audit assignment which you have entrusted to us.

We have examined the consolidated annual accounts for the year ended 31 December 2001, which have been preparedunder the responsibility of the Board of Directors and which show a balance sheet total of EUR 9,409.7 million and anincome statement resulting in a profit, for the year of EUR 482.6 million (group’s share). In addition, we have performedspecific procedures with respect to the Directors’ report.

Unqualified audit opinion on the financial statementsOur examination has been conducted in accordance with the auditing standards of the "Institut des Reviseurs d’Entreprises/Instituut der Bedrijfsrevisoren". Those standards require that we plan and perform the audit to obtain reasonable assuranceabout whether the consolidated annual accounts are free of material misstatement and are in compliance with the Belgianlegal and regulatory requirements.

In accordance with these standards we have taken into account the administrative and accounting organization of yourcompany as well as the procedures of internal control. The responsible officers of the company have clearly replied to all ourrequests for information and explanations. We have examined, on a test basis, the evidence supporting the amounts includedin the consolidated financial statements. We have assessed the accounting policies used, the significant estimates made bythe company and the overall presentation of the consolidated annual accounts. We believe that our audit provides areasonable basis for our opinion.

In our opinion, the consolidated financial statements of GBL as at and for the year ended 31 December 2001 which havebeen prepared in accordance with IFRS, present fairly the financial position of the group, and the results of its operations, andthe disclosures made in the notes to the accounts are adequate.

Additional certificationsWe supplement our report with the following certifications which do not modify our audit opinion on the consolidated financialstatements:- The Directors’ report includes the information required by the Companies Code and is in accordance with the consolidated

financial statements.- As has been indicated in the appendix to the financial statements, under a special dispensation obtained from the Banking

and Finance Commission, the consolidated financial statements have been prepared in accordance with IFRS and theregulations of the Seventh Directive has been substantially complied with.

Brussels, 26 March 2002

The Statutory Auditor,

DELOITTE & TOUCHEReviseurs d’Entreprises SC s.f.d. SCRL

Represented by Michel Denayer

Report of the Statutory Auditor


GBL Comptes consolidés 85



1. Consolidated balance sheet and income statement as at 31 December established in accordance with the Belgian accounting legislation(in EUR million)

Assets 2000 1999Fixed assets 7,059.8 5,547.8Goodwill 606.4 118.4

Group share 579.8 83.4Minority interests 26.6 35.0

Tangible assets 1.0 1.1Financial assets 6,452.4 5,428.3

Companies consolidated using the equity method 2,337.1 980.7Investments 2,337.1 852.9Amounts receivable 0.0 127.8

Other companies 4,115.3 4,447.6Investments, stocks and shares 4,066.1 4,446.8Amounts receivable 49.2 0.8

Current assets 1,237.0 1,634.2Amounts receivable after one year 0.1 1.0Amounts receivable within one year 29.7 55.4

Trade debtors 0.2 0.2Other amounts receivable 29.5 55.2

Short-term investments 1,173.6 1,512.8Cash at bank and in hand 24.5 38.2Prepayments and accrued income 9.1 26.8

Total 8,296.8 7,182.0

Expenses 2000 1999Interest and similar expenses 29.5 32.3Other financial expenses 15.4 15.2Depreciation of positive goodwill 28.5 7.1

Group share 26.9 5.2Minority interests 1.6 1.9

Sundry goods and services 13.4 12.8Remuneration, social security and pension costs 4.5 4.7Other current expenses 0.3 0.3Depreciation 0.4 0.4Amounts written off 2.2 41.8

of financial assets 0.4 28.1on current assets 1.8 13.7

Provisions for liabilities and charges 0.0 0.3Loss on disposal 2.6 0.6

of financial assets 0.2 0.2of current assets 2.4 0.4

Exceptional charges 0.0 80.7Taxes 21.6 11.7Group share of losses of companies consolidated using the equity method 0.0 1.8Consolidated profit 620.7 1,716.4

Group share 514.9 1,278.2Minority interests 105.8 438.2

Total 739.1 1,926.1

Supplementary financial data



Liabilities 2000 1999Shareholders’ equity 6,231.2 4,886.8Capital 610.8 610.8Share premium account 705.6 705.6Reserves 3,934.3 3,543.0Negative goodwill 947.7 0.8Differences on translation 32.8 26.6

Minority interests 925.3 1,375.1

Provisions and deferred taxes 7.8 11.9

Creditors 1,132.5 908.2Amounts payable after one year 819.2 499.9

Financial debt 819.2 499.9Amounts payable within one year 293.4 392.8

Current portion of debts payable after one year 123.9 0.0Financial debt 15.7 21.4Trade debts 0.1 0.6Taxes, remuneration and social security 2.1 7.9Other amounts payable 10.2 228.5Proposed dividend 141.4 134.4

Accruals and deferred income 19.9 15.5

Total 8,296.8 7,182.0

Income 2000 1999Income from financial assets 153.3 100.1

Dividends 148.8 92.5Interest 4.5 7.6

Income from current assets 35.1 65.6Other financial income 15.5 21.5Income from services rendered 2.1 1.9Other current income 1.4 1.6Reinstatement of amounts written off 42.8 16.7

on financial assets 39.6 5.1on current assets 3.2 11.6

Release of provisions for liabilities and charges 0.2 1.9Capital gains on disposal of 348.5 1,425.2

financial assets 313.9 1,385.8current assets 34.6 39.4

Exceptional income 0.1 1.9Tax adjustments and release of tax provisions 0.2 6.2Group share of profits of companies consolidated using the equity method 139.9 283.5

Total 739.1 1,926.1



2. Consolidated cash flow statement established in accordance with Belgian accounting legislation(in EUR million)

Cash flow from operations

Net profit: group share

Net profit: minority interests

Results of companies consolidated using the equity method

Dividends from companies consolidated using the equity method

Net capital gains on financial assets

Depreciation and amounts written off (net)

Change in provisions for liabilities and charges (charged and released)

Gross cash flow

Change in current assets

Change in current liabilities

Change in working capital requirement

Net increase (reduction) in cash flow from operations

Investments

Net change in tangible assets

Net change in financial assets

Net change in amounts receivable over one year

Net increase (reduction) in investments

Funding operations

Other changes in shareholders’ equity

Differences IAS RTL Group

Change in minority interests

Change in amounts payable after one year

Change in financial debt

Proposed dividend

Net increase (reduction) in funding

Net increase in cash and near cash

Cash and near cash at end of financial year

Cash and near cash at start of financial year

Net increase (reduction) in liquid funds

2000

514.9

105.8

(139.9)

32.3

(313.7)

(12.1)

(4.1)

183.2

(43.5)

(89.3)

45.8

137.4

0.4

641.8

(0.9)

(641.3)

6.2

17.8

(49.1)

319.3

(5.7)

(141.4)

147.1

(356.8)

1,209.5

1,566.3

(356.8)

1999

1,278.2

438.2

(281.7)

13.0

(1,385.6)

32.2

(0.5)

93.8

(191.3)

(562.8)

371.5

(277.7)

0.4

387.8

(5.1)

(383.1)

143.5

0.0

(172.0)

122.1

(0.1)

(134.4)

(40.9)

(701.7)

1,566.3

2,268.0

(701.7)


3. Abbreviated version of balance sheet and income statement as at 31 December As required by Belgian law, the annual accounts, management report of the Board of Directors and Statutory Auditor’s reporthave been filed with the Banque Nationale de Belgique (Belgian National Bank). These documents are available on requestfrom Groupe Bruxelles Lambert (see inside back cover).

The Statutory Auditor’s report on the annual accounts was unqualified.

In contrast to the consolidated accounts, the 2001 annual accounts are compared with the 2000 and 1999 annual accountsof Electrafina, which subsequently became GBL.

Abbreviated balance sheet (after appropriation)(in EUR million)

Fixed assets

Current assets

Total assets


Share capital and share premium account

Reserves

Profit carried forward

Provisions and deferred taxes

Amounts payable

Amounts payable after one year

Amounts payable within one year and accruals and deferred income

Total liabilities


20017,863.8

16.5

7,880.3

6,539.4

2,271.3

2,180.9

2,087.2

36.4

1,304.5

799.1

505.4

7,880.3

20005,129.8

786.8

5,916.6

5,340.1

2,637.0

205.7

2,497.4

1.5

575.0

542.0

33.0

5,916.6

19995,508.2

57.4

5,565.6

5,031.6

2,637.0

205.7

2,188.9

0.7

533.3

124.0

409.3

5,565.6


Income statement Expenses(in EUR million) 2001 2000 1999A. Interest expenses 43.7 13.2 9.3

B. Other financial costs 29.9 24.9 12.2

C. Miscellaneous goods and services 11.3 2.7 3.1

D. Remuneration, social security charges and pensions 1.4 0.9 0.9

E. Miscellaneous operating costs 0.1 - -

F. Depreciation and amounts written off the value

of establishment costs and tangible and intangible assets 0.5 - -

G. Amounts written off 86.5 0.5 60.6

1. financial assets 86.1 0.4 60.6

2. current assets 0.4 0.1 -

H. Provisions for liabilities and charges (0.2) - -

I. Losses on disposals 127.6 - 0.2

2. financial assets 126.2 - -

3. current assets 1.4 - 0.2

J. Exceptional charges 17.4 - -

K. Taxes - 0.1 0.1

L. Profit for the year 1,295.9 333.1 1,607.2

Total 1,614.1 375.4 1,693.6

N. Profit for the year available for appropriation 1,295.9 333.1 1,607.2

Income(in EUR million) 2001 2000 1999A. Income from financial assets 286.4 181.7 180.6

1. Dividends 286.3 181.7 180.6

2. Interests 0.1 - -

B. Income from current assets 15.4 7.5 0.7

C. Other financial income 8.9 1.9 1.4

D. Income from services provided 0.1 - -

E. Other operating income 1.1 0.1 0.1

G. Reinstatement of amounts written off on 1.1 69.4 -

1. financial assets 1.1 69.4 -

H. Release of provisions for liabilities and charges 0.1 - -

I. Gains on disposals 1,301.0 114.8 1,510.8

2. financial assets 1,301.0 114.6 1,509.5

3. current assets - 0.2 1.3

Total 1,614.1 375.4 1,693.6





4. Consolidated figures over 10 years(in EUR million)

Balance sheet

Non-current assets

Current assets

Total assets

Shareholders' equity

Minority interest

Non-current liabilities

Current liabilities

Total liabilities

IFRS income statement

Group share of earnings in associated

companies

Net dividends on financial assets




Taxes

Earnings on disposals and impairments

on financial assets

Minority interests


Gross dividend

Per share (3)

Coupon number for dividend (4)

Adjusted net assets per share (3)

Number of shares in issue (3)

Number of warrants in circulation (3)

Number of GBL shares held by GBL (3)

(1) Figures stated in accordance with the IFRS(2) Figures stated in accordance with Belgian accounting legislation(3) Data adjusted to take into account the multiplication by 5 of the number of shares following the merger on 26 April 2001 (4) Coupon numbers for 1992 to 1999 relate to Groupe Bruxelles Lambert S.A. (prior to the merger on 26 April 2001)


2000 (1)

6,126.7

878.5

7,005.2

5,112.0

902.3

766.6

224.3

7,005.2

93.7

127.9

(4.3)

34.3

(15.8)

(6.8)

354.5

(106.6)

476.9

1.20

1

82.00

122,160,125

0

9,359,730

2000 (2)

7,059.8

1,237.0

8,296.8

6,231.2

925.3

827.0

313.3

8,296.8

514.9

1.20

1

82.00

122,160,125

0

9,359,730

2001 (1)

8,489.7

920.0

9,409.7

8,526.4

0.0

789.6

93.7

9,409.7

(133.6)

140.5

(0.6)

59.8

(14.0)

(8.5)

439.0

0.0

482.6

1.32

2

67.77

138,300,053

0

5,310,143

1999 (2)

5,547.8

1,634.2

7,182.0

4,886.8

1,375.1

511.8

408.3

7,182.0

1,278.2

1.10

39

68.44

122,160,125

0

6,247,885

1998 (2)

3,531.3

2,538.5

6,069.8

3,599.5

1,108.9

390.2

971.2

6,069.8

882.1

1.07

38

47.93

122,160,125

0

4,999,635



1997 (2)

3,657.7

1,813.4

5,471.1

2,908.3

1,987.3

307.9

267.6

5,471.1

786.5

1.04

37

35.67

121,499,700

7,418,190

-

1996 (2)

3,835.2

871.0

4,706.2

2,198.2

1,910.0

338.2

259.8

4,706.2

418.7

0.99

36

28.94

117,543,795

11,374,095

-

1995 (2)

3,484.0

506.3

3,990.3

1,874.0

1,452.1

207.2

457.0

3,990.3

163.7

0.97

35

24.58

117,543,035

11,374,855

-

1994 (2)

3,200.0

453.3

3,653.3

1,839.0

1,230.2

302.8

281.3

3,653.3

164.4

0.97

33

23.33

117,543,000

11,374,890

-

1993 (2)

2,912.0

405.3

3,317.3

1,769.2

1,093.5

206.0

248.6

3,317.3

158.2

0.97

32

25.39

113,751,090

0

-

1992 (2)

2,712.0

696.6

3,408.6

1,694.0

1,033.2

232.2

449.2

3,408.6

157.0

0.94

30

17.77

113,747,820

13,480,775

-



Market capitalisation(market value)

Net result

Profit distribution

Earnings per share

Gross dividend per share

Share price


Group share (%)

Weighted average number of shares

Number of shares basic

Number of shares diluted

Fully diluted

IFRS

94 GBL Glossary

Glossary

Capital, share premiums, revaluation surpluses, reserves and profit/loss carried forwardnet of minority interests, after deduction of dividends and transfers to or from tax-exemptreserves

Total value calculated by multiplying the market price per share by the number of sharesin issue plus the number of shares represented by loan stock redeemable in shares

The profit or loss excluding minority interests and before transfers to or from tax-exemptreserves

Dividends and directors’ bonuses

Total profit for the year divided by the weighted average number of shares in issue overthe year

The dividend per share before deduction of withholding tax

The market price on the stock exchange on 31 December

Number of capital shares in issue on 31 December

Percentage interest held by the group, directly and indirectly via intermediary companies

Obtained by adding, prorata temporis, any shares issued as a result of capitalincreases during the current year to the number of shares in issue on 31 December ofthe previous year

The weighted average number of GBL shares held by GBL on 31 December of theprevious financial year, minus the number of shares, prorata temporis, bought and/or soldduring the financial year

The number of shares basic plus the potential shares. Potential shares mean call optionsgranted by the group

Taking into account the number of shares that would be in issue after the exercise of alloutstanding warrants and options and the conversion of all outstanding loan stockredeemable in shares

International Financial Reporting Standards formerly known as IAS


Adjusted net assets

Adjusted net assets per share

VVPR Strip

Annual average share price

Gross annual return

GBL Glossary 95

The adjusted net assets of the GBL share are a conventional referencecalculated by valuing the consolidated assets (i.e. mainly the group's portfolio)according to the following principles and adding to it the group's net cashposition:

• the share price for listed companies; • the group share of shareholders' equity for unlisted companies integrated

using the equity method; • the book value for unlisted companies not consolidated or not integrated using

the equity method.

The adjusted net assets take into account the conversion of warrants andoptions when they are in the money, i.e. when the share price is higher than theconversion price. However, applying the principle of caution, a shareholding isvalued at its realisable value if this is known and inferior to the reference value.

The adjusted net assets ignore any valuation in excess of share prices related tothe exercise of any control by GBL on its shareholdings.

The adjusted net assets divided by the number of shares in issue plus thenumber of shares in issue as at 31 December

The VVPR strip is presented at the same time as the corresponding dividendcoupon attached to a share, and entitles the holder to pay a reduced rate of15% withholding tax instead of the normal 25%

The arithmetic mean of the share price at the close of each day’s trading duringthe financial year

Calculated from the share price and the gross dividend received, the grossannual return

Gross dividend received + change in share price between 1 January and 31 December

Share price on 1 January

=



For further information

Groupe Bruxelles Lambert Avenue Marnix 24 - B-1000 BrusselsVAT: BE 407 040 209 – RCB 3.902Internet site: http://www.gbl.be

To obtain a copy of the annual report or if your address has changed, please contact:Carine Dumasy • Tel.: 32/2/547.23.52 • Fax: 32/2/547.22.85e-mail: [email protected]

In the event of loss or theft, or for information about GBL shares, please contact:Marc Desclez • Tel.: 32/2/547.24.28 • Fax: 32/2/547.22.85e-mail: [email protected]

Dit jaarverslag is ook verkrijgbaar in het NederlandsCe rapport annuel est aussi disponible en français

Editor: Thierry de RudderAvenue des Bécasses 6 - B-1640 Rhode-St-Genèse

Design and production: Landmarks, BrusselsPhotographs: Gettyimages, The Image Bank, G. Liesse, Image library Imerys Printed in Belgium by Vanmelle



Documents

Cover UK 4 pages 3/06/02 11:54 Page 2 Annual report 2001 · with article 29ter. § 1, sentence 1 of the Royal Decree no. 185 of 9 July 1935. Cover UK 4 pages 3/06/02 11:54 Page 3