6-K 1 sanitec_6k.txt SANITEC INTERNATIONAL S.A. FORM 6-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16 OF THE SECURITIES EXCHANGE ACT OF 1934 COMMISSION FILE NUMBER 333-102846 For the month of December 2004 Sanitec International S.A. 19-21 boulevard Prince Henri L-1724 Luxembourg RC Luxembourg B 82 055 Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F Form 20-F |X| Form 40-F |_| Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): Yes |_| No |X| Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): Yes |_| No |X| Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes |_| No |X| SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Sanitec International S.A. (Registrant) By: /s/ Timo Lehto ----------------------- Name: Timo Lehto Title: Principal Financial Officer and Director 3 December 2004 FORWARD-LOOKING STATEMENTS This report includes forward-looking statements. All statements other than statements of historical fact included in this report, including, without limitation, those regarding our future financial position and results of operations, our strategy, plans, objectives, goals and targets, and future developments in the markets where we participate or are seeking to participate, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "anticipate", "believe", "continue", "could", "estimate", "expect", "forecast", "intend", "may", "plan", "potential", "predict", "project", "should", or "will" or the negative of such terms or other comparable terminology. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements are based on numerous assumptions regarding our present and future business strategies and the environment in which we will operate in the future. These risks, uncertainties and other factors include, among other things, those listed under "Risk Factors" in our annual report on Form 20-F, filed with the SEC on April 28, 2004, as well as those included elsewhere in this report. Important factors that could cause our actual results, performance or achievements to differ materially from those in the forward-looking statements include, among others: o our ability to service our existing indebtedness; o our ability to fund our future operations and capital needs through borrowing or otherwise; o our ability to implement successfully our business strategy, including our ability to integrate our recently acquired businesses, exploit cross-selling opportunities, pursue growth opportunities and restructure our production network, and our ability to realize financial benefits from cost-saving initiatives; o our expectations with respect to European economic and general industry conditions; o our ability to establish and maintain production and supply channels; o our ability to compete effectively in a highly competitive environment; and o our expectations about growth in demand for our products. We do not intend to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf, are expressly qualified in their entirety by cautionary statements contained throughout this report. As a result of these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements. 3 December 2004 Page 1 of 2 Sanitec Press Release THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE IN OR INTO THE UNITED STATES OF AMERICA, CANADA, JAPAN, OR TO US PERSONS. Lecico Over-Allotment Option Excercised Further to our announcement on 24 November 2004 relating to the listing on the London Stock Exchange plc of Lecico Egypt S.A.E. ("Lecico") and the completion of a global offering of its shares and Global Depositary Receipts ("GDRs"), HSBC bank as the global co-ordinator of the global offering, on behalf of its managers, has now fully excercised the over-allotment option following the global offering. In addition to the 2,241,143 Lecico shares and GDR's it sold in the global offering, Sanitec's joint venture partnership Ceramic Holdings Middle East C.V. ("CHME") sold under the over-allotment option 1,241,016 Lecico GDR's. The sale proceeds from the over-allotment option sales amounted to US dollars 19.4 million net of transaction fees. All of these sale proceeds will be distributed to Sanitec in the next few weeks, following the dissolution of CHME. The exercise of the over-allotment option will reduce Sanitec's direct and indirect shareholding in Lecico from 21.2% to 15.0%. Sanitec intends to continue its current strategic relationship with Lecico in all areas, such as production co-operation and supply, unaffected by the reduction of its shareholding. Lecico's Global Offering was structured by way of an international offering outside Egypt and a private placement in Egypt, in the form of Ordinary Shares and GDRs, to institutional investors. HSBC Bank plc was the sole global co-ordinator and the sole bookrunner of the Global Offering. OVERVIEW OF LECICO o Lecico is a leading producer of export-quality sanitary ware in the Middle East and one of the largest producers of tiles in Egypt and Lebanon; o Lecico has a strategic relationship with Sanitec, including co-operation in the areas of production, management and training and the sale of its products to Sanitec under a purchase agreement; and o Lecico has a significant presence in the United Kingdom and some other European markets. SANITEC CORPORATION SANITEC IS A EUROPEAN MULTI-BRAND GROUP THAT DESIGNS, MANUFACTURES AND MARKETS BATHROOM CERAMICS AND BATH AND SHOWER PRODUCTS. THE GROUP IS BASED AROUND LOCALLY WELL KNOWN BRANDS, WHICH HAVE STRONG POSITIONS AND DEEP ROOTS IN THE BATHROOM BUSINESS, AND IS WELL POSITIONED AS A LEADING EUROPEAN PROVIDER FOR BATHROOM SOLUTIONS. IN 2003, SANITEC'S NET SALES AMOUNTED EUR 951.1 MILLION. THE GROUP EMPLOYS AROUND 7,100 PEOPLE, MAINLY IN EUROPE. THE 29 PRODUCTION PLANTS ARE ALSO LOCATED IN EUROPE WHEREAS THE SALES AND MARKETING NETWORK OPERATES WORLD-WIDE. Page 2 of 2 THIS ANNOUNCEMENT DOES NOT CONTAIN OR CONSTITUTE AN OFFER OR INVITATION TO PURCHASE OR SUBSCRIBE FOR ANY SECURITIES OF LECICO AND SHOULD NOT BE RELIED UPON IN CONNECTION WITH ANY DECISION TO PURCHASE OR SUBSCRIBE FOR ANY SUCH SECURITIES. THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE IN OR INTO THE UNITED STATES OF AMERICA, CANADA, JAPAN OR TO U.S. PERSONS. THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE OR A SOLICITATION OF AN OFFER TO PURCHASE SECURITIES IN THE UNITED STATES OR ANY OTHER JURISDICTION. THE ORDINARY SHARES AND GDRS REFERRED TO HEREIN (THE "SECURITIES") HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO OR FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS (AS SUCH TERMS ARE DEFINED IN REGULATION S UNDER THE SECURITIES ACT) ABSENT REGISTRATION UNDER THE SECURITIES ACT OR AN APPLICABLE EXEMPTION FROM SUCH REGISTRATION. THERE WILL BE NO PUBLIC OFFERING OF THE SECURITIES IN THE UNITED STATES. STABILISATION / FSA.

Tables CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in millions of euro) SANITEC INTERNATIONAL S.A. ----------------------------------------------------------------------- (unaudited) (unaudited) (unaudited) (unaudited) Period from Period from Period from Period from Period from January 1 - January 1 - January 1 - January 1 - January 1 - March 31, June 30, September 30, December 31, March 31, 2003 2003 2003 2003 2004 ---------------------------------------------------------------------------------------------------------------------------------- NET SALES 241.9 487.1 713.8 951.1 252.9 Other operating income 1.6 2.8 4.1 7.9 1.6 Operating expenses: Cost of products sold - materials and consumables (73.7) (150.9) (225.6) (299.1) (81.4) Personnel (75.6) (150.4) (216.3) (283.7) (71.3) Outside services (22.0) (42.6) (62.4) (88.0) (21.6) Depreciation and writedowns (11.4) (22.2) (32.9) (48.9) (10.4) Amortization of goodwill (11.0) (21.8) (32.5) (43.3) (10.3) Other operating expenses (34.7) (73.3) (107.3) (146.6) (35.6) ---------------------------------------------------------------------------------------------------------------------------------- OPERATING PROFIT 15.1 28.7 40.9 49.4 23.9 Other income (expenses): Equity in income (loss) of associated companies 0.5 2.0 3.7 1.9 0.7 Other income and expenses, net (24.3) (46.1) (69.6) (92.8) (22.5) ---------------------------------------------------------------------------------------------------------------------------------- INCOME (LOSS) BEFORE INCOME TAXES AND MINORITY INTERESTS (8.7) (15.4) (25.0) (41.5) 2.1 Income taxes (5.7) (12.4) (18.7) (24.6) (9.6) Minority interests (0.2) (0.4) (0.6) (0.5) (0.2) ---------------------------------------------------------------------------------------------------------------------------------- INCOME (LOSS) BEFORE EXTRAORDINARY ITEMS (14.6) (28.2) (44.3) (66.6) (7.7) Extraordinary items -- -- -- (18.8) -- NET INCOME (LOSS) (14.6) (28.2) (44.3) (85.4) (7.7) ---------------------------------------------------------------------------------------------------------------------------------- EBITDA 37.5 72.7 106.3 141.6 44.6 ==================================================================================================================================

CONSOLIDATED BALANCE SHEETS SANITEC INTERNATIONAL S.A. ------------------------------------------------------------------------------ (Amounts in millions of euro) (unaudited) (unaudited) (unaudited) (unaudited) At March 31, At June 30, At September 30, At December 31, At March 31, 2003 2003 2003 2003 2004 ----------------------------------------------------------------------------------------------------------------------------------- ASSETS Fixed assets and other long-term investments Intangible assets, net Goodwill 707.7 696.6 685.5 655.5 647.7 Other intangible assets 43.5 43.2 41.4 40.4 39.6 ----------------------------------------------------------------------------------------------------------------------------------- 751.2 739.8 726.9 695.9 687.3 Property, plant and equipment, net: Land 72.4 71.1 71.1 68.4 68.7 Buildings 106.8 104.2 101.7 98.9 97.7 Machinery and equipment 94.4 94.3 87.4 90.3 86.9 Other tangible assets 5.9 5.8 5.6 7.5 7.2 Advances paid and construction in progress 12.4 11.9 21.8 10.0 11.4 ----------------------------------------------------------------------------------------------------------------------------------- 291.9 287.3 287.6 275.1 271.9 Long-term investments and receivables: Investment securities 0.5 0.4 0.4 0.3 0.2 Other receivables 9.2 9.6 9.9 10.3 7.1 ----------------------------------------------------------------------------------------------------------------------------------- 9.7 10.0 10.3 10.6 7.3 Investments in associated companies 33.0 33.0 34.1 23.6 24.9 ----------------------------------------------------------------------------------------------------------------------------------- Total fixed assets and other long-term investments 1,085.8 1,070.1 1,058.9 1,005.2 991.4 Current assets : Inventories : Finished goods 80.7 83.3 79.3 82.0 75.9 Work in progress 23.1 23.1 22.1 20.5 22.4 Raw material 58.0 57.8 55.9 58.5 59.2 ----------------------------------------------------------------------------------------------------------------------------------- 161.8 164.2 157.3 161.0 157.5 Trade accounts receivable 179.5 187.6 178.8 145.8 182.5 Loans receivable 5.5 5.1 5.3 5.9 5.8 Prepaid expenses and accrued income 20.0 21.7 18.6 19.9 25.7 Other current assets 23.1 12.1 14.4 19.4 16.3 Cash and cash equivalents 14.1 15.3 31.3 50.8 33.9 ----------------------------------------------------------------------------------------------------------------------------------- 242.2 241.8 248.4 241.8 264.2 Total current assets 404.0 406.0 405.7 402.8 421.7 TOTAL ASSETS 1,489.8 1,476.1 1,464.6 1,408.0 1,413.1 ===================================================================================================================================

CONSOLIDATED BALANCE SHEETS SANITEC INTERNATIONAL S.A. ----------------------------------------------------------------------------- (Amounts in millions of euro) (unaudited) (unaudited) (unaudited) (unaudited) At March 31, At June 30, At September 30, At December 31, At March 1, 2003 2003 2003 2003 2004 ----------------------------------------------------------------------------------------------------------------------------------- SHAREHOLDERS' EQUITY AND TOTAL LIABILITIES Shareholders' equity: Share capital 10.0 10.0 10.0 10.0 10.0 Share premium funds 140.1 140.1 140.1 140.1 140.1 Other reserves (15.1) (15.7) (16.5) (18.8) (14.7) Retained earnings (deficit) (102.6) (104.6) (104.2) (111.5) (198.7) Net income (loss) for the period (14.6) (28.2) (44.3) (85.4) (7.7) ----------------------------------------------------------------------------------------------------------------------------------- Total shareholders' equity 17.8 1.6 (14.9) (65.6) (71.0) Minority interests 3.3 3.5 3.1 3.0 3.2 Provisions 92.3 95.9 94.4 89.0 84.3 Non-current liabilities: Long term debt, excluding current installments 719.5 700.0 700.0 680.4 632.8 Shareholder loans and subordinated loans 405.0 410.0 410.0 439.3 439.3 Deferred tax liabilities 9.8 10.2 10.6 9.6 10.3 ----------------------------------------------------------------------------------------------------------------------------------- 1,134.3 1,120.2 1,120.6 1,129.3 1,082.4 Current liabilities: Current debt 3.3 6.4 2.9 3.3 4.6 Current installments of long-term debt 25.8 31.6 31.1 36.6 87.5 Trade accounts payable 86.9 89.7 75.8 97.8 90.2 Accrued expenses and deferred income 98.0 96.7 113.9 97.0 111.1 Other current liabilities 28.1 30.5 37.7 17.6 20.8 ----------------------------------------------------------------------------------------------------------------------------------- 242.1 254.9 261.4 252.3 314.2 Total liabilities 1,376.4 1,375.1 1,382.0 1,381.6 1,396.6 SHAREHOLDERS' EQUITY AND TOTAL LIABILITIES 1,489.8 1,476.1 1,464.6 1,408.0 1,413.1 ===================================================================================================================================

CONSOLIDATED STATEMENTS OF CASH FLOWS SANITEC INTERNATIONAL S.A. ------------------------------------------------------------------------------- (Amounts in millions of euro) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) Period from Period from Period from Period from Period from Period from January 1 - April 1- July 1 - October 1 - January 1 - January 1 - March 31, June 30, September 30, December 31, March 31, December 31, 2003 2003 2003 2003 2004 2003 ----------------------------------------------------------------------------------------------------------------------------------- Cash flow from operating activities: Operating profit 15.1 13.6 12.2 8.5 23.9 49.4 Intangibles, property, plant and equipment, net Depreciation, amortization and writedown 22.4 21.6 21.4 26.8 20.7 92.2 Selling profit / (loss) of fixed assets -- -- (0.1) (0.9) (0.1) (1.0) ----------------------------------------------------------------------------------------------------------------------------------- Cash flow before working capital changes 37.5 35.2 33.5 34.4 44.5 140.6 Changes in working capital Current assets, non-interest bearing, (increase) /decrease (36.1) 2.0 8.8 24.0 (38.9) (1.3) Inventories, (increase) / decrease (8.3) (2.9) 7.3 (5.2) 4.5 (9.1) Current liabilities, non-interest bearing, increase/ (decrease) (0.3) 4.8 (12.3) 17.4 (18.3) 9.6 ----------------------------------------------------------------------------------------------------------------------------------- (44.7) 3.9 3.8 36.2 (52.7) (0.8) Cash flow from operating activities before financial items and taxes (7.2) 39.1 37.3 70.6 (8.2) 139.8 Interest expenses paid (8.2) (17.3) (4.8) (28.6) (6.0) (58.9) Interest income received 0.9 0.6 0.7 0.6 0.8 2.8 Other financial income received and paid 2.6 (1.6) 1.6 (2.1) (1.0) 0.5 Income taxes paid (5.0) (4.4) (4.5) (4.1) (3.5) (18.0) ----------------------------------------------------------------------------------------------------------------------------------- CASH FLOW FROM OPERATING ACTIVITIES (A) (16.9) 16.4 30.3 36.4 (17.9) 66.2 =================================================================================================================================== Cash flow from investing activities: Investments in other tangible and intangible assets (5.2) (7.2) (10.4) (9.2) (4.5) (32.0) Proceeds from sale of tangible and intangible assets 0.3 3.8 0.2 3.9 1.6 8.2 ----------------------------------------------------------------------------------------------------------------------------------- CASH FLOW FROM INVESTING ACTIVITIES (B) (4.9) (3.4) (10.2) (5.3) (2.9) (23.8) ===================================================================================================================================

SANITEC INTERNATIONAL S.A. ------------------------------------------------------------------------------------- (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) Period from Period from Period from Period from Period from Period from January 1- April 1 - July 1 - October 1 - January 1 - January 1 - March 31, June 30, September 30, December 31, March 31, December 31, 2003 2003 2003 2003 2004 2003 -------- -------------------------------------------------------------------------------------------------------------------------- Cash flow from financing activities: Loans receivable, (increase) / decrease 0.3 (0.1) (0.6) (0.5) 3.5 (0.9) Current loans increase / (decrease) (1.7) 3.3 (3.6) 0.6 1.3 (1.4) New long term loans 3.2 -- -- -- -- 3.2 Amortization of long term loans -- (13.7) -- (13.5) -- (27.2) Dividends paid -- -- (0.6) -- -- (0.6) Other changes, including exchange rate changes 1.7 (0.9) 1.3 0.1 (1.6) 2.2 -------- -------------------------------------------------------------------------------------------------------------------------- CASH FLOW FROM FINANCING ACTIVITIES (C) 3.5 (11.4) (3.5) (13.3) 3.2 (24.7) =================================================================================================================================== CHANGE IN CASH AND CASH EQUIVALENTS (A+B+C), INCREASE / (DECREASE) (18.3) 1.6 16.6 17.8 (17.6) 17.7 ======== ========================================================================================================================== Cash and cash equivalents at the beginning of 32.4 13.7 14.7 33.0 51.5 33.1 period Cash and cash equivalents at the end of period 14.1 15.3 31.3 50.8 33.9 50.8 -------- -------------------------------------------------------------------------------------------------------------------------- Reconciliation of cash and cash equivalents As previously reported 34.6 14.1 15.3 31.3 50.8 34.6 Foreign exchange adjustment (2.2) (0.4) (0.6) 1.7 0.7 (1.5) -------- -------------------------------------------------------------------------------------------------------------------------- Cash and cash equivalents at the beginning of 32.4 13.7 14.7 33.0 51.5 33.1 period Change in cash and cash equivalents (18.3) 1.6 16.6 17.8 (17.6) 17.7 -------- -------------------------------------------------------------------------------------------------------------------------- Cash and cash equivalents at the end of period 14.1 15.3 31.3 50.8 33.9 50.8 ===================================================================================================================================

CONSOLIDATED STATEMENTS OF OPERATIONS SANITEC INTERNATIONAL S.A. --------------------------------------------------------------------------------------- (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) Period from Period from Period from Period from October Period from January 1 - April 1 - July 1 - 1 - December 31, January 1 - March 31, June 30, September 30, 2003 2003 March 31, (Amounts in millions of euro) 2003 2003 2004 --------------------------------------------------------------------------------------------------------------------------------- NET SALES 241.9 245.2 266.7 237.3 252.9 Other operating income 1.6 1.2 1.3 3.8 1.6 Operating expenses: Cost of products sold, materials and consumables (73.7) (77.2) (74.7) (73.5) (81.4) Personnel (75.6) (74.8) (65.9) (67.4) (71.3) Outside services (22.0) (20.6) (19.8) (25.6) (21.6) Depreciation and writedowns (11.4) (10.8) (10.7) (16.0) (10.4) Amortization of goodwill (11.0) (10.8) (10.7) (10.8) (10.3) Other operating expenses (34.7) (38.6) (34.0) (39.3) (35.6) --------------------------------------------------------------------------------------------------------------------------------- OPERATING PROFIT 15.1 13.6 12.2 8.5 23.9 ================================================================================================================================= EBITDA 37.5 35.2 33.6 35.3 44.6 =================================================================================================================================

SEGMENTS SANITEC INTERNATIONAL S.A. --------------------------------------------------------------------------------------------------- (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) Period from January Period from Period from Period from October Period from January 1 - April 1 - July 1 - 1 - 1 - March 31, June 30, September 30, 2003 December 31, 2003 March 31, (Amounts in millions of euro) 2003 2003 2004 ---------------------------------------------------------------------------------------------------------------------------------- Net Sales Bathroom Ceramics 155.6 155.1 145.9 149.1 165.4 Bath and Shower Products 68.4 72.4 64.6 68.0 73.0 Vacuum Sewage Systems 17.9 17.7 16.2 20.2 14.5 ---------------------------------------------------------------------------------------------------------------------------------- Total net sales 241.9 245.2 226.7 237.3 252.9 EBITDA Bathroom Ceramics 25.7 24.2 23.7 22.5 31.1 Bath and Shower Products 10.3 9.1 8.5 10.8 12.2 Vacuum Sewage Systems 1.5 1.9 1.4 2.0 1.3 ---------------------------------------------------------------------------------------------------------------------------------- Total EBITDA 37.5 35.2 33.6 35.3 44.6 Net sales by region: Central Europe(1) 43.6 39.0 43.1 35.5 43.6 South-West Europe 41.0 39.7 33.7 30.9 43.1 UK and Ireland 24.5 26.4 24.9 28.0 25.8 Benelux 21.7 20.4 17.7 20.4 25.0 Southern Europe 21.3 24.5 18.8 20.3 21.1 Central Eastern Europe(1) 14.6 16.5 19.4 18.5 18.0 North-East Europe 52.5 56.4 48.1 58.1 57.1 Export 4.8 4.6 4.8 5.4 4.7 Evac 17.9 17.7 16.2 20.2 14.5 ---------------------------------------------------------------------------------------------------------------------------------- Total 241.9 245.2 226.7 237.3 252.9

NET INDEBTEDNESS SANITEC INTERNATIONAL S.A. ----------------------------------------------------------------------- (Amounts in millions of euro) At At At At At March 31, June 30, September 30, December 31, March 31, 2003 2003 2003 2003 2004 ------------------------------------------------------------------------------------------------------------------------ Total debt (including shareholder loan and PIK 1,154.0 1,148.0 1,144.0 1,159.6 1,164.2 loan) Cash and bank balances (-) 14.1 15.3 31.3 50.8 33.9 Shareholder loan (-) 334.3 334.3 334.3 358.5 358.5 PIK loan (-) 70.7 75.7 75.7 80.8 80.8 ------------------------------------------------------------------------------------------------------------------------ Total net debt (1) 734.9 722.7 702.7 669.5 691.0 Interest bearing receivables /short-term (-) 5.5 4.9 5.5 5.8 5.9 Interest bearing receivables /long-term (-) 9.0 9.4 9.7 10.1 6.5 ------------------------------------------------------------------------------------------------------------------------ Net indebtedness (excluding shareholder loan 720.4 708.4 687.5 653.6 678.6 and PIK loan) ------------------------------------------------------------------------------------------------------------------------ Shareholder loan (+) 334.3 334.3 334.3 358.5 358.5 PIK loan (+) 70.7 75.7 75.7 80.8 80.8 ------------------------------------------------------------------------------------------------------------------------ Net indebtedness (including shareholder loan 1,125.4 1,118.4 1,097.5 1,092.9 1,117.9 and PIK loan) ======================================================================================================================== 1) We define total net debt as the total of long term debt including current installments and current debt, less cash and cash equivalents. Subordinated indebtedness (PIK-loan and Shareholder loan) is excluded. DEVELOPMENT OF NET INDEBTEDNESS AND EXPLANATION ON NET CASH MOVEMENT FOR OPERATING, INVESTING AND FINANCING ACTIVITIES JANUARY - MARCH 2004. (Amounts in millions of euro) SANITEC INTERNATIONAL CHANGE S.A. ------------------------------------------------------------------------------- ----------------------------- NET INDEBTEDNESS (INCLUDING SHAREHOLDER LOAN AND PIK) DECEMBER 2003 1,092.9 CHANGE OF NET INDEBTEDNESS Increase/(Decrease) of interest bearing debt 4.6 (Increase)/Decrease of interest bearing loan receivable 3.5 (Increase)/Decrease in cash and cash equivalents 16.9 Increase/(Decrease) of net indebtedness December 2003 - March 2004 25.0 ------------------------------------------------------------------------------- ----------------------------- NET INDEBTEDNESS (INCLUDING SHAREHOLDER LOAN AND PIK) MARCH 2004 1,117.9 ------------------------------------------------------------------------------- ----------------------------- USES/SOURCES ------------------------------------------------------------------------------- ----------------------------- USES/SOURCES NON-CASH EFFECTIVE Exchange variance of liabilities (3.3) USES/SOURCES CASH EFFECTIVE Cash flow from operating activities (17.9)

------------------------------------------------------------------------------- ----------------------------- Cash flow from investing activities (2.9) Other variances (0.9) (21.7) ------------------------------------------------------------------------------- ----------------------------- INCREASE OF NET INDEBTEDNESS JANUARY - MARCH 2004 (25.0) =============================================================================== =============================

(Amounts in millions of euro) SANITEC INTERNATIONAL S.A -------------------------------------------------------- LONG TERM DEBT INCLUDING CURRENT PORTION December 31, 2003 March 31, 2004 -------------------------------------------------------------------------------------------------------------- Senior A 241.4 244.7 Senior B 107.8 107.8 Senior C 107.8 107.8 High Yield Bond 260.0 260.0 -------------------------------------------------------------------------------------------------------------- 717.0 720.3 Short-term and overdrafts 3.3 4.6 PIK On-Loan I 80.8 80.8 Shareholder On-Loan I 358.5 358.5 -------------------------------------------------------------------------------------------------------------- Total 1,159.6 1,164.2 ==============================================================================================================

(Amounts in millions of euro except percentages) ----------------------------------------------------------------------------------------------------------------- SANITEC INTERNATIONAL S.A. 2004 2005 2006 2007 2008 THERE-AFTER TOTAL ----------------------------------------------------------------------------------------------------------------- Liabilities: Long-term debt: Senior loan 87.5 48.2 58.2 59.6 53.1 153.7 460.3 Weighted av. rate 4.8% 4.8% 4.8% 4.8% 4.8% 5.1% 4.9% PIK loan -- -- -- -- -- 80.8 80.8 Rate -- -- -- -- -- 13.8% 13.8% Weighted av. rate 4.8% 4.8% 4.8% 4.8% 4.8% 8.1% 6.3% Interest rate swaps: Variable to fixed 25.0 110.0 200.0 -- -- -- 335.0 Average pay rate 4.1% 4.3% 4.0% -- -- -- 4.1% Interest rate options: Sold floors: 50.0 -- -- -- -- -- 50.0 Weighted av. strike: 2.8% -- -- -- -- -- 2.8% Bought caps: 50.0 -- -- -- -- -- 50.0 Weighted av. strike: 4.5% -- -- -- -- -- 4.5% -----------------------------------------------------------------------------------------------------------------

(Amounts in millions of euro) ---------------------------------------------------------------------------------------------------------------------- SANITEC INTERNATIONAL S.A. SANITEC INTERNATIONAL S.A. December 31, 2003 March 31, 2004 Contract Carrying Fair Avg. Contract Carrying Fair Avg. Amount Value Value Maturity Amount Value Value Maturity (months) (months) ---------------------------------------------------------------------------------------------------------------------- IRS (Euribor) 330.0 (1.6) (7.6) 28.0 305.0 (3.0) (10.3) 27.1 IRS (GBP -Libor) 28.4 -- (0.4) 24.0 30.0 -- (1.3) 21.0 Interest rate options 100.0 -- (0.3) 11.8 100.0 -- (0.3) 8.8 Foreign exchange forwards 172.8 -- 1.8 3.2 189.8 -- (1.4) 2.9 Foreign exchange options 9.9 -- 0.1 0.9 14.5 -- (0.2) 0.7 ----------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------- Currency Notional Amount Fair Value Amount Proforma Change in Values --------------------------------------------------------------------------------------------------------- DKK 23.6 23.6 2.1 GBP 21.3 20.7 1.9 NOK 16.7 16.7 1.5 SEK 55.3 54.6 5.1 USD 23.4 23.4 2.1 Others 49.5 49.3 4.5 --------------------------------------------------------------------------------------------------------- Total 189.8 188.3 17.2 =========================================================================================================

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