the file.

Transcription

the file.

2006 CORPORATE AND SUSTAINABLE DEVELOPMENT REPORT – GROUPE SEB
Translation: anglodoc.com
01 56 88 11 11 - Photos : Christophe Audebert, Patrick Forestier, Jean-Michel Turpin-Coté Cour - Fédération Envie, GraphicObsession communicationfinancière
actifin
Groupe SEB – Les 4M – Chemin du Petit Bois
BP 172 – 69134 Écully Cedex – France
www.groupeseb.com
01 CORPORATE ACTIVITIES
GROUPE SEB IN 2006
.01. GROUP PROFILE
.02. 2006 HIGHLIGHTS
.04. INTERVIEW WITH THE CHAIRMAN
.08. MANAGEMENT BODIES AND AUDITORS
.12. FINANCIAL OVERVIEW
.18. SEB SHARE OVERVIEW
.20. CHALLENGES AND CHANGE
2006
CORPORATE AND
SUSTAINABLE DEVELOPMENT REPORT
22
30
38
ACTING FOR TOMORROW MEANS KNOWING HOW TO MOVE AHEAD
INTERNATIONAL
ACTING FOR TOMORROW MEANS INVENTING THE WINNING COMBINATION
BRANDS / INNOVATION / DISTRIBUTION
ACTING FOR TOMORROW MEANS ADAPTING TO THE REAL WORLD
BEING COMPETITIVE
44 SUSTAINABLE DEVELOPMENT
ACTING FOR TOMORROW MEANS PROGRESSING ALL THE TIME
VISION, PRINCIPLES, GOALS
52
60
70
76
ACTING FOR TOMORROW MEANS CONSIDERING EVERYONE
CORPORATE RESPONSIBILITY
ACTING FOR TOMORROW MEANS GROWING WITH OUR PARTNERS
PARTNER RESPONSIBILITY
ACTING FOR TOMORROW MEANS PROMOTING OUR CORPORATE VALUES
SOCIAL RESPONSIBILITY
ACTING FOR TOMORROW MEANS ADVANCING WHILE PROTECTING THE ENVIRONMENT
ENVIRONMENTAL RESPONSIBILITY
actifin
www.groupeseb.com
GROUPE SEB IN 2006
.01. GROUP PROFILE
2006
CORPORATE AND
22
30
38
INTERNATIONAL
BEING COMPETITIVE
52
60
70
76
Cookware_Pressure cookers
Table-top ovens
n°2
n°1
Irons and steam systems_Electric kettles_Steam cookers_Food-preparation appliances_Toasters_Electric fryers_Informal meal equipment
Electric barbecues _Waffle and sandwich makers
n°3
Filter and espresso coffee makers
GLOBAL MARKET LEADER IN SMALL DOMESTIC EQUIPMENT
NORTH AMERICA
EUROPEAN UNION
ASIA AND OTHER TERRITORIES
Canada, United States, Mexico
Germany, Austria, Belgium, Denmark, Spain, Finland, France,Greece,
Ireland, Italy, Norway, The Netherlands, Portugal, Great Britain, Sweden.
Australia, New Zealand, the CIS countries, Ukraine, Turkey, United Arab Emirates,
Iran, central Europe, China, South Korea, Indonesia, Japan, Malaysia, Singapore,
Taiwan, Thailand, Vietnam
ACKNOWLEDGMENTS
The Financial Communications Department and the Sustainable Development Division collaborated
in the preparation of this document. It is the fruit of the efforts of many members of Group staff and stakeholders
whom we would like to thank for their contribution.
8,955
CONSOLIDATED SALES 48%
ADVERTISING BUDGET 40%
MARKETING COMPANIES 18
FACTORIES 13
1,010
FACTORIES 3
EMPLOYEES
EMPLOYEES
1,283
FACTORIES 3
EMPLOYEES
We would like to thank in particular:
– The Group Executive Committee and Corporate Functions
and General Management.
– Other members of staff who helped to prepare this report by providing information, graphic material
or documentation, responding to questions or reporting on their experience.
– Stakeholders and those interviewed:
• Didier le Menestrel, Chairman of Financière de l’Echiquier, a Groupe SEB shareholder
2,493 EMPLOYEES
9% CONSOLIDATED SALES
9% ADVERTISING BUDGET
• Esther Suen, General Manager of Simatelex, Groupe SEB supplier
• Christophe Mauguin, former Groupe SEB employee, now a healthcare assistant
• Professor Christian Cabrol and Dr Christian Recchia
• Angèle Garcia, sponsored by the Second Chance Foundation
7 MARKETING COMPANIES
3 FACTORIES
– External support:
SOUTH AMERICA
French text: Françoise Lafragette
Argentina, Brazil, Chile, Colombia, Peru, Venezuela
Design and production: ACTIFIN.
English translation: anglodoc.com
This report is printed on paper which complies with the following standard: ISO 14001,
made without chlorine, recyclable.
The printer of this report is environmentally certified by
Table-top ovens
n°2
n°1
n°3
NORTH AMERICA
EUROPEAN UNION
ACKNOWLEDGMENTS
8,955
FACTORIES 13
1,010
FACTORIES 3
EMPLOYEES
EMPLOYEES
1,283
FACTORIES 3
EMPLOYEES
2,493 EMPLOYEES
3 FACTORIES
SOUTH AMERICA
GROUP PROFILE
A unique portfolio of top brands, leaders in their markets
A worldwide presence in more than 120 countries
Strong commercial deployment through multi-format retailing
A winning blend of technology, ingenuity and design
The talent and motivation of 13,800 employees
focused on research and excellence
Our corporate mission: improving YOUR daily life
GROUPE SEB...
150 YEARS OF DEDICATION
SALES:
€2,652 million + 7.7%
OPERATING MARGIN:
NET INCOME:
€262 million stable
€88 million -13.9%
FINANCIAL DEBT:
€422 million stable
CAPITAL EXPENDITURE:
€85 million
BUSINESS AREAS
COOKWARE • Frying pans, saucepans, casseroles, bakeware, oven dishes, pressure cookers, low-pressure steam pots,
kitchen utensils...
ELECTRIC COOKING • Deep fryers, table-top ovens, barbecues, informal meal appliances, breadmakers, waffle
makers, meat grills, toasters, steam cookers...
FOOD AND BEVERAGE PREPARATION • Food processors, beaters, mixers, blenders, centrifugal juice extractors, small
food-preparation equipment, coffee makers (pod, filter and espresso), electric kettles...
PERSONAL CARE • Haircare equipment, depilators, bathroom scales, foot massage appliances, babycare (bottles,
bottle-heaters, sterilizers, nightlights)...
LINEN CARE • Steam irons and steam generators, semi-automatic washing machines, garment steam brushes...
FLOOR CARE AND HOME COMFORT • Vacuum cleaners (upright or canister, with and without dust bag, compact
and cordless), fans, heaters and air-conditioners...
01
CORPORATE ACTIVITIES
2006 HIGHLIGHTS
JANUARY • Announcement of an industrial reorganization plan in France for the Fresnay, Dampierre,
Vosges and Vernon factories.
FEBRUARY • Brazil’s consumer magazine Consumidor Moderno awards top ranking to Arno for corporate
social responsibility and respect for consumers.
APRIL • Opening of a sales office in Indonesia1. • Creation of a marketing subsidiary in Romania.
MAY • Management convention attended by 180 members of the Group Operations Committee to review
the ‘CAP+5’ Corporate Action Plan.
JUNE • Krups Expert food processors win a RedDot Product Design Award at one of the world’s leading
design contests in Essen, Germany2.
SEPTEMBER • Triple certification for the Group’s Millville site: awarded ISO 14001 (environment) and OHSAS
(health & safety at work), adding to its existing ISO 9001/2000 certification in quality management3.
OCTOBER • Thierry de La Tour d'Artaise joins the French delegation to China, headed by President Jacques Chirac.
• Agreement signed with a local industrial operator for the conversion and re-use of the Group’s Dampierre factory.
NOVEMBER • Creation of the Groupe SEB Ukraine marketing subsidiary. • ‘Entreprise et Environnement’
sustainable development eco-products award won by Rowenta’s Shock Absorber vacuum cleaner at the Pollutec
Trade Fair in Lyon4.
DECEMBER • Agreement signed with Modulex Europe for the conversion of the Vosges factory.
• Innovation Award for the Krups BeerTender, selected by France’s ‘LSA’ (Libre Service Actualité) trade magazine5.
3_
2_
4_
1_
5_
2006 HIGHLIGHTS
ACQUISITIONS CONTINUE
Convinced that the small domestic equipment market is inherently profitable, Groupe SEB aims
to play a key role in consolidating this sector and exploiting its potential for growth.
Acquisition of Mirro WearEver (USA)
On 9 August 2006, the Group bought most of the assets of the American cookware company, Mirro WearEver,
a subsidiary of Global Home Products. The acquired assets, which cost $ 37.1 million, include trademarks,
inventories and trade receivables and part of the equipment at the company’s Nuevo Laredo factory in Mexico
(though not the factory itself). This acquisition confirms the Group’s world leadership in cookware, reinforcing
its status in North America where Mirro WearEver will complement the T-Fal offer in middle ranges and the All-Clad
premium offer. With this takeover, the Group now covers all distribution circuits in the United States and gains
greater access to mass-market channels.
Mirro WearEver reported sales of $120 million in 2005, and contributed $35 million to total Groupe SEB sales
GROUPE SEB IN 2006
in 2006 (consolidated from 16 August).
Cookware range_ WearEver
China_ Shanghai
Agreement signed to take a stake in Supor (China)
On 16 August 2006, the Group embarked on a process to take a majority stake in the Chinese company, Supor,
domestic market leader in cookware and China’s number 4 in small electrical appliances. This alliance is subject
to various authorizations in a somewhat lengthy decision process. The Supor general meeting of shareholders
overwhelmingly approved the transaction on 31 August 2006. The deal now awaits a go-ahead from the Chinese
Trade Ministry (MOFCOM) and the country’s securities regulator (CRCS).
The transaction will involve three inter-dependent operations:
• acquisition of shares from the Su family; • an increase in capital reserved for Groupe SEB; • and a partial
public share offer.
At the end of the process, Groupe SEB should control between 51% and 59% of the capital.
Founded in 1989 and listed on the Shenzhen stock exchange since 2004, Supor operates four factories in
the Zhejiang and Hubei provinces of China. It employs 5,000 people, of which 80% in production. With established
sales networks throughout China, it covers most distribution channels.
Supor makes and sells a large variety of cookware products in different materials. In small electrical appliances,
a more recent but fast-expanding side of its business, it deals in cooking equipment such as rice cookers, induction
hobs, and electric pressure cookers.
Supor reported sales equivalent to €207 million in 2006 (+42% on the previous year) of which two-thirds
in the domestic market.
Of key strategic interest to Groupe SEB, this transaction should help it to accelerate its development in China
thanks to a broad range of products adapted to the needs of Asian consumers, supported by a leading local brand,
an extensive distribution network and a competitive manufacturing base.
03
Acting for tomorrow
means
KNOWING
HOW TO MOVE AHEAD
How did the Group perform in 2006?
04
The 2006 trading year was distinctly positive in three ways.
• First, because the Group achieved its financial objectives: it returned to a steady rate of 5.4%
organic growth, which has been a key priority for several years; it maintained the value of
its operating margin against higher prices for raw materials and adverse exchange rates; and
it ended the year in a sound financial condition which leaves it plenty of room for manoeuvre.
• Meanwhile, the Group pursued its external growth by acquiring Mirro WearEver in the United
States, and by signing a preliminary accord to take a majority stake in the Chinese company,
Supor, which would give us favoured access to this fast-expanding market. As you know, we have
often emphasized the strategic importance to the Group of international expansion and putting
down strong local roots.
• The third positive element was the excellent progress made with our French industrial
restructuring plan and the Group’s responsible approach to its implementation: solutions have
already been found for the re-employment of virtually all the affected staff via, for example,
in-house transfers, age-related measures, and plant conversion contracts signed with new
industrial operators for two of the sites.
INTERVIEW WITH THE CHAIRMAN
So, you returned to strong organic growth in 2006.
What drove this growth?
The progress made in 2006 was due to stabilized sales in Europe after three years of price-war
attrition, and to the Group’s continued rapid international expansion.
GROUPE SEB IN 2006
Our growth is built around a powerful innovation dynamic – vital in an offer-driven market –
and on our strategic handling of a differentiated and complementary brand portfolio, supported
by vigorous local sales drives and extensive marketing campaigns. The Group’s comprehensive offer,
which spans every market segment from entry-level to high added-value products, has proved
itself to be a well-adapted and winning strategy. We vindicated this approach with our Principio
range which was aimed to bring back quality and value to basic products: since its launch
two years ago, Principio’s volume sales have climbed steadily without encroaching on our mid-range
offer. In the premium segment, our Krups and All-Clad emblematic brands confirmed their strong
positions, and we are promoting Lagostina to complete our international top-end offer.
The still substantial mid-range segment continues to benefit from Groupe SEB’s active innovation
policy – clearly evident in the improved product mix.
05
«
A Group well prepared for the future
»
With the industrial restructuring plan under way in France,
is Groupe SEB now well prepared for the future?
The restructuring plan announced early last year and set in motion in the months that followed
aims to rationalize our industrial base in Europe and guarantee our long-term viability in the
increasingly harsh trading climate seen in recent years. Low-price competition from China is
a reality to which we must adapt. In this new context, it is no longer possible to maintain European
production of some of the most basic products. However, massive relocation is not the answer,
as this would deprive the company of its fundamental technological and industrial strengths.
Which is why we are constantly adapting and refocusing the Group’s European resources
in centres of expertise where protected technologies and economies of scale can guarantee
our success in today’s highly competitive global market. It is noteworthy that eight of every ten irons
made at France’s Pont-Evêque factory are for export, and that last year the Rumilly plant turned
out a record of over 52 million articles of cookware for worldwide distribution. These facts,
however, do not blind us to the need for vigilance with regard to economic and monetary trends
that could change the situation at any time. Our capacity to adapt is still the most powerful weapon
we have to ensure our long-term competitive success.
What are the challenges and outlook for 2007?
Our prime objective for 2007 is to conclude the deal to take a majority stake in the Chinese
company, Supor, allowing us to embark on an active phase of development in this market where
our sales today remain far short of our ambitions. In the meantime, this operation is still subject
to the approval of the Chinese authorities, and though we are confident in its successful outcome,
we are aware that it will take some time.
We will also pursue our restructuring plan in France. As I said above, this process is going well
and we hope to complete it by the end of 2007 or early in 2008 – with no outright redundancies,
in accordance with our original undertaking.
06
In terms of trading, the trends seen in Europe at the end of 2006 are encouraging, and
international business should continue to grow despite the weakness of many currencies
in relation to the euro. Against this background, the Group is aiming for fresh organic growth
in sales and an increased operating margin. The improved situation in Europe and the steps taken
in recent years to make the Group more competitive should help to offset any new rise in the cost
of raw materials.
INTERVIEW WITH THE CHAIRMAN
The SEB corporate enterprise will mark its 150th anniversary in 2007. This longevity has been built
on consistently sound economic fundamentals, but also on values passed down by
the company’s founders and deeply rooted in its history: high-quality work, team spirit,
thoroughness, loyalty and mutual respect. I am convinced that profitability and a responsible
approach to business are inseparable in the long term: the Group’s future viability and
development depend on the results it achieves. But, building up enduring corporate performance
also means embracing the challenges of the world in which we live. Groupe SEB’s commitment
in this area is long-standing: we need only call to mind, for example, that the Group helped
to pioneer employee shareholding and profit-sharing in France. Since that time, we have
considerably extended our commitment which today includes adherence to the Global Compact
and the Code of Conduct of the CECED (European Committee of Domestic Equipment
Manufacturers), our introduction of a Diversity Charter and our involvement in numerous
community-based projects aimed to combat social exclusion. The planned creation of a Groupe
SEB Enterprise Foundation will further strengthen this commitment.
What is your assessment of the SEB share performance in 2006?
After quite a long phase of stability at around €80, the financial markets showed signs of taking
just measure of Groupe SEB’s true potential for development. The 2006 trading year and the start
of 2007 were punctuated with a flow of good news about the SEB share performance, with
investors very likely impressed by the Group’s return to the steady organic growth awaited over
the last two years. I see this rise in the SEB share price as market recognition of the relevance
of Groupe SEB strategy and as a sign of confidence on the part of investors – which, to say
the least, is more than gratifying.
GROUPE SEB IN 2006
How does Groupe SEB reconcile the demands
of immediate profitability with a long-term strategy?
Thierry de La Tour d’Artaise
Ecully, 16 February 2007.
07
GOVERNING AND
MANAGEMENT BODIES
GROUP EXECUTIVE COMMITTEE
(left to right)
Rémi Descosse, Harry Touret,
Thierry de La Tour d'Artaise,
Jacques Alexandre, Jean-Pierre Lac,
Frédéric Verwaerde.
Thierry de La Tour d'Artaise
Chairman and CEO
Jacques Alexandre
Executive Vice-President, Strategy and Strategic Business Areas
Rémi Descosse
Executive Vice-President, Industrial Operations
Jean-Pierre Lac
Executive Vice-President, Finance
Harry Touret
Executive Vice-President, Human Resources
Frédéric Verwaerde
Executive Vice-President, Continental Structures
The Group Executive Committee directs Group strategy and operations.
It meets twice a month to:
08
• define Group strategy and monitor its implementation;
• decide on priorities for action and strategic plans;
• allocate the human and financial resources needed for the proper running of the Group.
In 2006, the Group Executive Committee met 23 times.
GOVERNING AND MANAGEMENT BODIES
GROUP MANAGEMENT BOARD
The Group Executive Committee is supported by the Group Management Board which includes most members
of the general management of the Continental Structures and Strategic Business Areas:
Strategic Business Areas
Philippe Crevoisier, President, Electric cooking
Jean-Pierre Lefèvre, President, Linen and Personal care, Home comfort and Home care
Christian Ringuet, President, Cookware
François Sydorowicz, President, Food and beverage preparation
Continental General Management
Cyril Buxtorf, President, West and South Europe
Marcio Cuñha, President, South America
Alain Gautier, President, North America
Volker Lixfeld, President, North and Central Europe
Patrick Llobregat, President, Asia and other territories
The Group Management Board ensures the proper overall functioning of the Group.
It meets on average every two months:
• to monitor Group performance and results;
• adapt the Group’s commercial and industrial strategy;
• and serve as a forum for exchange, reflection and suggestions.
The Group Management Board met on six occasions in 2006, twice for two-day sittings.
GROUP ORGANIZATION
Growing internationalization of markets and expanding operations have led the Group to adopt an organization
that simplifies Group-wide corporate functions and facilitates network management. This organization, based on
interdependent working teams, a global perspective, and the development of synergies and centres of expertise,
reports directly to the Group Executive Committee and functions as a three-fold structure.
GROUPE SEB IN 2006
Luc Dohan, Chief Science and Technology Officer
Strategic Business Areas (SBAs)
Four SBA General Management Structures draw up overall strategy for the product families for which they are
responsible. Their role covers new product design, implementation of industrial strategy (capital expenditure, factory
location, etc.), and worldwide sales and marketing strategy (ranges, pricing, advertising budgets, distribution channels,
and so on).
Continents
The Continental General Management Structures are charged with expanding the Group’s presence in their respective
geographic zones. To make these management structures more efficient, the Group defined five Continental structures
at the beginning of 2007 to cover the following zones: West and South Europe (including France), North and Central
Europe, North America, South America, and Asia and other territories. These structures support the sales and
marketing strategy defined with the SBAs by ensuring coordinated and efficient management of the Group’s network
of marketing subsidiaries and local distributors.
Group-wide Corporate Functions
The Group promotes operational excellence via its Corporate Functions structure to which it has assigned four
objectives: develop centres of expertise to serve the SBAs and Continental structures; simplify the Group’s internal
functioning to improve efficiency; ensure a common language and shared working methods; and maximize potential
economies of scale. These Corporate Functions include Human Resources, Finance, Strategy and Brands,
Manufacturing, Technology, Sustainable Development, IT and Logistics, Quality, Purchasing, and Legal Affairs.
09
THE GROUPE SEB BOARD OF DIRECTORS
Thierry de La Tour d’Artaise
Founder group member – aged 52 – Chairman and Chief Executive Officer of SEB SA since 2000 –
Number of SEB shares held: 14,821.
Tristan Boiteux
Founder group member, member of FÉDÉRACTIVE – aged 44 – Member of FÉDÉRACTIVE Advisory Board –
Damarys Braida
Founder group member, member of VENELLE INVESTISSEMENT – aged 39 – Joint Manager of VENELLE
INVESTISSEMENT – Number of SEB shares held: 56,583.
Pascal Castres Saint Martin
Independent Director – aged 71 – Number of SEB shares held: 385.
Norbert Dentressangle
Independent Director – aged 52 – Number of SEB shares held: 1,650.
Philippe Desmarescaux
Independent Director – aged 68 – Number of SEB shares held: 1,782.
FÉDÉRACTIVE
Founder group shareholder investment company created in 2005, represented by its Chairman, Pascal Girardot –
aged 51 - member of the Founder group – Number of SEB shares held: 3,146,229.
Hubert Fèvre(a)
Founder group member, member of FÉDÉRACTIVE – aged 42 – Member of FÉDÉRACTIVE Advisory Board –
FFP (société Foncière, Financière et de Participations)
A holding company listed on the Paris stock exchange and majority-held by the Peugeot family, represented
by Christian Peugeot – aged 53 – Number of SEB shares held: 857,337.
Jacques Gairard(a)
Founder group member, member of VENELLE INVESTISSEMENT – aged 67 – Chairman and Chief Executive Officer
of Groupe SEB from 1990 to 2000 – Member of the Management Board of VENELLE INVESTISSEMENT –
Philippe Lenain
Independent Director – aged 70 – Number of SEB shares held: 550.
Antoine Lescure(a)
Founder group member, member of FÉDÉRACTIVE – aged 35 – Number of SEB shares held: 75,992.
Frédéric Lescure
10
Founder group member, member of FÉDÉRACTIVE – aged 46 – Number of SEB shares held: 21,850.
VENELLE INVESTISSEMENT
Founder group member – family shareholder company created in 1997, represented by Olivier Roclore – aged 52 –
Chairman of the Management Board of VENELLE INVESTISSEMENT – Number of SEB shares held: 2,219,997.
Jérôme Wittlin
Founder group member, member of VENELLE INVESTISSEMENT – aged 47 – Joint manager of VENELLE
INVESTISSEMENT - Number of SEB shares held: 2,046.
Each Board member is required to hold a minimum number of shares in the SEB SA nominal share register
corresponding to the equivalent of about two years of attendance fees.
(a) Renewal to be proposed at the AGM of 4 May 2007.
GOVERNING AND MANAGEMENT BODIES
THE FUNCTIONING OF THE BOARD OF DIRECTORS
The Audit Committee
15 members
of which 4
independent directors
This committee comprises three members:
Pascal Castres Saint Martin, chairman, Norbert Dentressangle and Jérôme Wittlin.
Two of the three members including its chairman are independent directors. The chairman previously occupied
senior financial positions in a large multi-national company.
This committee informs the Board on the identification, evaluation and handling of the main financial risks to which
the Group may be exposed. It is concerned in particular with ensuring the conformity of financial reporting methods.
It assists the Board with observations or recommendations and participates in the preparatory procedure
for appointing statutory auditors.
The Audit Committee met on four occasions in 2006, with 92% attendance and dealt mainly with the following
matters:
• the 2005 annual accounts and the half-year accounts for 2006;
• review of the main conclusions of internal audits in 2006 and the internal audit plan for 2007;
• a review and analysis of risks.
The Nominations and Remuneration Committee
This committee comprises three members:
Pascal Girardot, permanent representative of FÉDÉRACTIVE, chairman, Philippe Desmarescaux and
Philippe Lenain.
Two of the three members are independent directors.
GROUPE SEB IN 2006
• the work done by the statutory auditors and recommendations on internal control;
The committee reports on its work to the Board of Directors and makes recommendations on the composition
of the Board, on the terms of office of directors, and on the Group's organization and structures. It also makes
proposals to the Board on policy for the remuneration of executives, as well as on the introduction of share
subscription and purchase option schemes, and on the terms and conditions applying to these. This committee
met on three occasions in 2006, with full attendance.
Its work concerned mainly:
• the introduction of a stock option plan for 111 members of Group management;
• criteria for calculating bonus payments for 2006 and targets for 2006;
• the annual evaluation of the Board of Directors;
• an analysis of the makeup of the Board of Directors.
11
Directors at the Annual General Meeting in May 2006.
FINANCIAL OVERVIEW
• European Union*
• Asia and other territories
• North America
• South America
CHANGE IN SALES, BY ZONE
€ millions
246
2006
2005
2004
390
204
128
5,7
729
352
286
1,268
639
556
1,319
GEOGRAPHIC BREAKDOWN OF SALES
Asia and other territories 28%
France 22%
12
1,287
Other EU countries* 26%
North America 15%
South America 9%
* Former 15-member bloc of the European Union.
2,652
2,463
2,289
FINANCIAL OVERVIEW
• Operating margin
TRADING RESULTS/SALES • Income from ordinary activities (before financial expense)
• Net income
As %
2006
2005
3.3
5.8
4.1
5,7
9.9
7.4
5.7
2004
10.6
8.2
11.4
RETURN ON EQUITY • Shareholders’ equity at 31 December
€ millions
817
2006
801
2005
14.8
21.9
688
2004
11.0
CASH FLOW AND CAPITAL EXPENDITURE • Cash flow
GROUPE SEB IN 2006
Net income (n) /
shareholders’ equity (n-1) as %
• Capital expenditure
€ millions
2006
85
2005
99
2004
99
290
283
261
NET FINANCIAL DEBT AND GEARING • Net debt at 31 December
13
€ millions
Debt-to-equity ratio
(gearing)
2006
422
0.5
2005
423
0.5
2004
331
0.5
SUMMARY CONSOLIDATED FINANCIAL STATEMENTS
Consolidated income statement (Years ended 31 December)
In € millions
2006
2005
Pro forma
Revenue
Operating expenses
2004
(a)
IFRS
2,651.7
2,462.9
2,288.7
(2,027.8)
(2,389.3)
(2,200.7)
OPERATING MARGIN
262.4
262.2
260.9
Discretionary and non-discretionary profit-sharing
(25.8)
(29.3)
(34.2)
RECURRING OPERATING PROFIT
236.6
232.9
226.7
Other operating income and expense
(83.0)
(50.1)
(40.0)
OPERATING PROFIT
153.6
182.8
186.7
Finance costs
(25.6)
(17.6)
(8.1)
(4.9)
(7.6)
(4.4)
Other financial income and expense
Share of profits (losses) of associates
(1.0)
(1.1)
-
PROFIT BEFORE TAX
122.1
156.5
174.2
Income tax expense
(34.4)
(54.6)
(40.9)
PROFIT FOR THE PERIOD
87.7
101.9
133.3
Minority interests
(0.1)
(0.1)
(2.5)
PROFIT ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT
87.6
101.8
130.8
Basic earnings per share
5.41
6.25
8.10
Diluted earnings per share
5.38
6.21
8.02
EARNINGS PER SHARE (in €)
(a) Adjustments made to the reported income statement in order to present pro forma data for 2005.
14
N.B. The accounts presented above do not include consolidated financial flows or notes to the financial statements,
which can be consulted in the Reference Document filed with the French Financial Markets Authority (AMF)
on 26 March 2007 under the reference D.07-0222. The Auditors’ Report on the full financial statements is given
on page 108 of the Reference Document.
FINANCIAL OVERVIEW
Consolidated balance sheet (At 31 December)
Assets
2006
2005
2004
Pro forma (a)
Pro forma (a)
IFRS
Goodwill
118.9
129.4
115.9
Other intangible assets
275.4
272.8
194.2
Property, plant and equipment
333.5
355.1
356.2
2.7
2.2
4.0
Other non-current financial assets
31.3
7.1
4.6
Deferred tax assets
42.0
76.2
71.7
5.1
6.1
4.2
NON-CURRENT ASSETS
808.9
848.9
750.8
Inventories
517.1
449.8
386.0
Trade receivables
646.4
630.3
552.0
Other receivables
66.9
57.3
39.6
Current tax assets
29.0
28.3
12.4
2.5
4.1
-
Investments in non-consolidated companies
Other non-current assets
Derivative instruments
Cash and cash equivalents
54.1
49.4
40.4
CURRENT ASSETS
1,316.0
1,219.2
1,030.4
TOTAL ASSETS
2,124.9
2,068.1
1,781.2
In € millions
Equity and liabilities
Share capital
2006
51.1
2005
2004
Pro forma (a)
Pro forma (a)
IFRS
50.9
51.2
Reserves and retained earnings
839.4
808.4
699.1
Treasury stock
(73.9)
(59.8)
(64.7)
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT
816.6
799.5
685.6
MINORITY INTERESTS
-
1.2
2.4
816.6
800.7
688.0
Deferred tax liabilities
59.5
109.3
69.0
Long-term provisions
118.4
111.9
111.1
Long-term borrowings
80.2
104.3
18.6
EQUITY
Other non-current liabilities
9.5
8.1
1.7
NON-CURRENT LIABILITIES
267.6
333.6
200.4
Short-term provisions
101.3
61.8
56.9
Trade payables
342.7
303.7
298.3
Other current liabilities
165.5
178.5
173.7
33.6
21.8
11.6
Current tax liabilities
Derivative instruments
0.9
1.6
-
Short-term borrowings
396.7
366.4
352.3
CURRENT LIABILITIES
1,040.7
933.8
892.8
TOTAL EQUITY AND LIABILITIES
2,124.9
2,068.1
1,781.2
(a) Adjustments made to the balance sheet in order to present pro forma data at 31 December 2004 and 2005.
GROUPE SEB IN 2006
In € millions
15
COMMENTS ON THE ACCOUNTS
Sales
Groupe sales in 2006 amounted to €2,652 million, a rise of 7.7% at current exchange rates or 7.9% at constant
parity. This robust performance is the outcome of three factors:
• organic growth of 5.4% for the year, against 0.6% in 2005;
• a €63 million sales gain with the full-year contributions of Lagostina and Panex (included last year for 8
and 7 months respectively) and the sales of the American company Mirro WearEver integrated since
16 August 2006 (4.5 months);
• a €7 million negative currency effect, compared with a positive effect in 2005. This was caused by the substantial
weakening of many currencies against the euro, particularly in the second half of the year.
The return to sustained organic growth was helped by the Group’s rapid headway in international markets and
stabilized sales in Europe after several years of decline.
The 2006 trading year got off to a good start, with sales well above their level of a year earlier. This trend toned down
in the second and third quarters, but saw a fairly general strong recovery approaching the end of the year.
Trading by geographic zone, though not uniform, was less contrasted than in recent years. In Europe, the year ended
on an upbeat note: a number of markets which had seen difficulties in recent years (notably Germany, France and
Italy) livened up as the months passed due to an easing of pressure on prices and a better product mix. Meanwhile,
the Group made new gains in south Europe, performing well in Spain, Portugal and Greece. Sales were up in North
America, though brands performed unevenly in the United States, while sales in Canada varied by period. Business
was more even in Mexico. Meanwhile, South America, central Europe, the CIS countries, and Asia and other
territories all confirmed their key role as growth drivers for the Group which went on accelerating and reinforcing
its activities in these zones.
ALLOCATION OF EARNINGS
SUPPLIERS: €1,779.8 MILLION
of which 2,535 direct industrial suppliers
(including a panel of 368 suppliers
accounting for 85% of purchases)
CLIENTS: €2,651.7 MILLION
• Europe 48%
• North America 15%
• South America 9%
• Asia and other territories 28%
16
RESERVED FUNDS: €201.1 MILLION
• refinancing investments: €96.5 million
• variations of provisions linked to business risks: €57.2 million
• transferred to reserves: €47.4 million
BANKS AND BONDHOLDERS: €30.4 MILLION
mainly financial expenses relating to interest on bank loans
GROUPE SEB
FINANCIAL OVERVIEW
Trading results
Groupe SEB’s operating margin (OM) for 2006 was €262 million. Stable in value compared with the previous year,
it included a negative structural impact of €-6 million (against €+6 million in 2005) due to the minus contribution
of the newly acquired company Mirro WearEver, taken over in difficult circumstances. The operating margin
for unchanged structure would have been €268 million (+2.3%).
Operating margin, in € millions
-20
+29
-2
-20
+19
-6
262
Sales
volume
Product and
price mix
Purchase
prices
Costs
Currency
effect
Acquisitions
OM 2006
Meanwhile, the Group continued to fuel its innovation drive with a budget of €46 million, or 1.7% of sales
(with €36 million booked and €10 million capitalized). In addition to an advertising budget of €92 million
(€90 million in 2005) numerous point-of-sale promotional campaigns were organized.
Operating profit amounted to €154 million, against €183 million in 2005. This figure includes lower profit-sharing
and bonus payments due to the effects of restructuring on the results of the French companies, and a higher
negative balance for Other income and expense items: €-83 million (against €-50 million in 2005). This high figure
is made up as follows:
• €72.3 million in restructuring charges, of which €66.5 million for industrial reorganization in France,
and €5.8 million for measures to boost competitive performance in Brazil, Mexico and Italy;
GROUPE SEB IN 2006
OM 2005
262
• impairments of €8.7 million relating to French plant closures and other sites;
• €2.7 million in negative goodwill;
• other sundry items for a total charge of €4.7 million.
Net financial expenses rose from €-25 million to €-30 million, reflecting the increased cost of debt due to higher
dollar-denominated interest rates. Income tax, on the other hand, was substantially reduced by the activation
of tax-loss carryforwards in Brazil.
At €87.6 million, profit attributable to equity holders
STATE AND LOCAL AUTHORITIES: €78.5 MILLION
• corporation tax: €34.4 million
• local taxes: €44.1 million
of the parent company was down by 14% on 2005, a drop
explained mainly by the burden of restructuring charges.
In the balance sheet, shareholders' equity at
31 December 2006 stood at €817 million, an increase
on the €801 million figure at the end of 2005. On the
SHAREHOLDERS: €40.4 MILLION
paid in 2006 in respect of the 2005 trading year
basis of a year-end debt level of €422 million (stable
despite the acquisition costs of 2006), the debt-to-equity
ratio was unchanged at 0.52, reflecting the Group’s solid
financial situation.
EMPLOYEES: €521.5 MILLION
paid to 13,741 employees:
• 71% in total salary
• 29% in social charges
• bonus and profit-sharing (€25.8 million) to be paid in 2007
For constant structure, debt would have been
€367 million at the end of 2006, indicating net cash
generation of €55 million for the year.
17
SEB SHARE OVERVIEW
BREAKDOWN OF CAPITAL
At 31 December 2006
Founder group 42.4%
Individual shareholders 5.4%
Foreign investors 14.6%
French institutional investors 24.0%
Treasury stock 4.8%
Employees 3.8%
FFP 5.0%
BREAKDOWN OF VOTING RIGHTS
At 31 December 2006
Founder group 58.8%
Individual shareholders 4.8%
Foreign investors 10.4%
French institutional investors 17.7%
Employees 4.7%
FFP 3.6%
DILUTED NET INCOME AND DIVIDEND PER SHARE
18
In euros
2006
Net income per share
Net dividend
* Dividend proposed at the Annual General Meeting of 4 May 2007.
2005
2004
2004
IFRS
IFRS
published
2003
2002
5.38
6.21
8.02
2.55*
2.40
2.40
7.57
9.06
7.25
2.40
2.27
1.96
SEB SHARE OVERVIEW
SEB SHARE PRICE
CAC 40 (adjusted)
SEB
Euros
130.00
120.00
110.00
100.00
90.00
80.00
70.00
60.00
|02/06
|03/06
|04/06
|05/06
|06/06
|07/06
|08/06
|09/06
|10/06
|11/06
|12/06
|01/07
AVERAGE DAILY SHARE TRANSACTIONS IN 2006
Volume
Capital (€ thousands)
43,988
12,906
27,711
17,372
21,617
21,390
31,488
18,752
26,494
38,168
18,185
22,221
49,431
7,000
60,000
5,948
50,000
6,000
GROUPE SEB IN 2006
|01/06
5,000
40,000
4,042
4,000
3,864
30,000
3,000
2,681
2,481
20,000
1,984
1,856
1,601
10,000
2,410
2,341
1,720
2,000
1,949
1,150
1,000
0
0
|01/06
|02/06
|03/06
|04/06
|05/06
|06/06
|07/06
|08/06
|09/06
|10/06
|11/06
|12/06
|01/07
Stockmarket capitalization at 31 December 2006: €1,831 million
The SEB share performed well in 2006, maintaining an average rate of €93. A fall-off following the report that sales
for 2005 were lower than expected held the share below the CAC average until October. This gap was then narrowed
by the successive announcements of the Mirro WearEver acquisition, the signing of an accord to buy a stake
in the Chinese company, Supor, and promising 9-month sales. The SEB share thus regained impetus and stayed
at an average of €106 between mid-October and mid-January.
The share’s upward trend then steepened markedly on publication of 2006 sales. It exceeded the €120 mark
on 17 January, rising to a peak of €137.20 during trading on 19 February 2007, to stabilize at around €125
at the end of February.
19
CHALLENGES AND CHANGE
A COMPLEX TRADING ENVIRONMENT
Groupe SEB is world leader in Small Domestic Equipment, and operates in both cookware and
electrical appliances. Growing in value, these sectors benefit from strong demand by first-time
buyers in newly emerging markets, and from the growing popularity of product categories such
as beverage preparation, personal care, floor care and cookware in general.
A changing context
The small domestic equipment sector continued to undergo rapid and profound change due to the combined effects
of low-priced imports from China flooding into developed countries, the growing concentration of major retailers,
and polarization of the market. The latter has caused a shift toward entry-level and top-range products, to the
detriment of a shrinking mid-range segment.
This context has led to mounting pressure on prices in Europe in recent years.
However, 2006 trading saw some improvement in the situation in Europe in the second half, with renewed interest
in branded products, eased pressure on prices, and a better product mix. It is still too early to know whether
this trend will last. But it could be an encouraging sign of the market’s realization that there are limits to a system
where price is the only criterion.
Multiple forms of competition
Competition is not of the same type in cookware and small electrical appliances. Markets are still highly fragmented
and few rivals enjoy a really worldwide presence. Most of them focus either on specific product families
or geographic zones. We therefore encounter these competitors in certain product segments or geographic areas,
but not across the full spectrum of our product portfolio, or in every market.
Low-price competition from Chinese imports in the form of retail-banner or no-brand products have also had
a profound impact on the market. This has led some Western manufacturers to radically adapt their economic
model and resort to massive relocation of production and substantial or even total reliance on sourcing.
This, in turn, has drained expertise in technologies and industrial know-how. In this situation, some of our rivals
who do not have sufficient critical size or are no longer able to create added value have difficulty withstanding
20
the pressure. Consolidation of the sector must therefore continue, and even intensify.
ESTIMATED VALUE OF WORLD MARKET
AND GROUPE SEB MARKET SHARE
• Cookware
• Small electrical appliances
€6 billion
15%
€25 billion
10%
CHALLENGES AND CHANGE
A GROUP EQUIPPED TO WIN
Groupe SEB has all the advantages needed to take up today’s challenges and profit from the new
orientation of the market. Our progress in 2006 was driven by two main aims:
To reinforce our existing positions
Management of ranges and brands
Segment-by-segment marketing.
Success of the Moulinex Principio range.
Use of Group-wide ranges.
Development of Krups and Rowenta.
200 new products and models.
Innovation
97 patents filed.
Permanent adaptation of our industrial base
Restructuring in progress.
Strengthening of geographic positions
Mature markets: Japan, Spain, Portugal, Australia.
Sourced products: 31% of sales.
and Colombia.
To identify and exploit new sources of growth
Expansion in fast-growth markets
Penetration of new territories: Malaysia, Singapore,
Thailand.
Participation in Chinese economic growth.
Development in high-potential product families
Advances in espresso coffee makers, personal-care
appliances and blenders.
Broadened retail spectrum
20 Casa Lagostina brand outlets.
GROUPE SEB IN 2006
Emerging markets: CIS countries, Turkey, Brazil
Alternative channels: 10% of 2006 sales.
Creation or exploitation
of new major product categories
Quick start-up for the breadmaker.
Expanding in doser beverage appliances.
Establishment of the electric kettle in Japan.
Development of partnerships
Sales and marketing: Heineken for the BeerTender,
Nestlé for Nespresso and Dolce Gusto, the Elite agency
for personal-care products, and Jamie Oliver for
cookware.
Research and design: ADEME* and ENSAM** Chambéry
for the Shock Absorber vacuum cleaner.
*ADEME: French Environment and Energy Management Agency.
**ENSAM: Ecole nationale supérieure d’Arts et Métiers.
BREAKDOWN OF 2006 SALES, BY SECTOR
21
Home care and other 4%
Linen care, Personal care and Home comfort 28%
Electric cooking 14%
Food and beverage preparation equipment 26%
Cookware 28%
Acting for tomorrow
means
DEFENDING STRONGHOLDS AND
EXPANDING
With roots in France and a solid base in Europe,
Groupe SEB has been conquering world markets
for 30 years. Convinced that to build lasting stronghold
positions around the globe it must be alert to distinctive
local needs and respond to them, the Group has based
its approach on proximity to markets and parallel
development of universal and local product ranges.
This unity and diversity give momentum to Groupe SEB.
MATURE MARKETS:
CONSOLIDATING POSITIONS
Mature markets have been the mainstay of our international development. The Group
22
is omnipresent today in Europe, the United States and Japan, backed by its powerful brands
and a vast distribution network built up with diligence, patience and determination.
A difficult context
In these developed markets, small electrical appliances and cookware have become an integral
and essential part of daily life. As their level of household equipment is already high, these
markets are driven more by the product offer than by demand. Competition is rife between
established brands, retail-banner brands and low-priced products imported from China which
have made lightning advances in recent years.
‘Slow Cooker’_ All-Clad
Germany
Argentina
Austria
Australia
New Zealand
Belgium
Brazil
Canada
CIS countries
Chile
China
Colombia
South Korea
Denmark
Spain
United States
Central Europe
Finland
France
Greece
Ireland
Italy
Japan
Mexico
Middle East
Norway
The Netherlands
Peru
Portugal
Great Britain
Sweden
Taiwan
Thailand
Turkey
Venezuela
Vietnam
...
120
Present in more than
countries,
Groupe SEB is expanding on new frontiers
every year.
INTERNATIONAL
INTERNATIONAL
INTERNATIONAL
23
Combined with the concentration of the retail trade, this rife completion has led to:
• a sharp polarization of markets provoking an ‘hour-glass’ effect with rapidly expanding demand
for entry-level and top-range products, to the detriment of a shrinking mid-range segment;
• strong downward pressure on the sale prices of small electrical appliances and a real
plummeting of the average price of everyday products such as filter coffee makers, toasters,
electric kettles and juice extractors.
The key to success in this context is innovation and the development of new segments.
But, beyond launching products, it is also vital to ensure attractive point-of-sale presentation and
a broad up-to-date choice spanning the full market spectrum. Regular renewal of product choice
helps to cultivate the loyalty of retail clients and maintain consumer interest.
KRUPS ESPRESSERIA ELECTED PRODUCT OF THE YEAR IN PORTUGAL
24
Portugal’s market leader in coffee preparation, the Group performed outstandingly in just a year. The fully automatic
Espresseria coffee maker launched at the end of 2005 was the motive force behind a triumph that instantly boosted
our ranking in this market: today, Krups holds a 40%-plus share of the espresso market in value. The brand’s
long-standing reputation in Portugal, backed by a dynamic sales force, high-profile advertising, point-of-sale
demonstrations, targeted marketing and a Krups VIP Club – all giving pride of place to the customer –
earned market acclaim for the Espresseria which carried off the title ‘Product of the year’.
Spain +12%
Austria +10%
INTERNATIONAL
INTERNATIONAL
Encouraging signs in 2006
Putting strategy into practice has not always been easy. Groupe SEB had to cope with a number
of difficult years – particularly in Europe which accounts for half of its sales – before returning
to growth in 2006. Independently of the good results obtained in Spain, Portugal, Greece and
Austria, this positive trend reveals the limits of a system where price is the only criterion –
as pertained in Germany for quite some time, in Italy for the last two or three years and in
France in the last two years. The new tendency is a sign that consumers are turning back to
quality
and added value, having had their taste of cheap products. If anything, this experience has made
discriminating consumers even more demanding today. The Group was able to benefit across
its entire offer last year from this renewed interest in established brands.
The more positive climate in Europe also helped us to gain market share with well-received
recent launches of ground-breaking innovations: the Actifry electric fryer aimed at the healthyFactory_ All-Clad
cooking segment; the BeerTender home beer-tapping system which was a big hit in France;
the Nespresso-Krups ‘Le Cube’ coffee maker; the Intens vacuum cleaner and the Activ Brush
hairstyling appliance acclaimed in many markets. These products were backed by strong
advertising campaigns.
Meanwhile, in the United States, the Group’s acquisition of Mirro WearEver in August 2006
consolidates our presence in the US cookware market with its well-positioned entry-level
and mid-range brands which complement our T-Fal offer. At the same time, T-Fal’s joint
development of a range of electrical products with leading chef Emeril Lagasse offers another
source of growth in sales. In top-ranges, All-Clad put in an excellent performance, while
25
Rowenta confirmed its strength.
North America
Japan
Australia
+11%
+24%
+12%
In Japan, after building its business on cookware for many years and making new inroads in
the irons sector, Groupe SEB brought consumers new pleasure in the art of tea-making
by creating an electric kettle market from scratch. This huge commercial success has been
spurring sales growth in the Japanese market for the last two years.
Our much more recent presence in Australia and New Zealand is still in the build-up phase.
Tangible advances have been made, especially in the upper ranges, with the Group taking full
advantage of its early success in Jamie Oliver cookware, as well as in irons and espresso coffee
makers, thereby paving the way for new products such as the steam cooker which shows good
promise.
Groupe SEB Milville HQ_ USA
26
ROWENTA’S HAIRSTYLER OFF TO A GOOD START IN THE NETHERLANDS
In an effort to stimulate sales in The Netherlands, the Group decided to launch a full gamut of haircare appliances
by Rowenta, ranging from the Ionic or Ceramic hair dryer to the Lissima and the Activ Brush. The Rowenta assortment
was hailed by both retailers and consumers as soon as it was released in October 2006. The campaign was a keynote
victory in the Group’s penetration of the Dutch market: in just a few weeks, starting from almost nothing, Rowenta carved
out a 12% share of the market in electric haircare appliances. From TV advertising to dedicated websites, press relations,
point-of-sale promotion with the Elite label, and product demonstrations...no effort was spared to make this a campaign
with a lasting impact.
INTERNATIONAL
EMERGING MARKETS:
READY TO SEIZE OPPORTUNITIES
INTERNATIONAL
Poland +15%
CIS countries +23%
Thailand +20%
Brazil, Russia, India and China (the so-called ‘BRICs’ in the financial world) and other
key emerging economies with strong growth potential are new frontiers for the Group,
foreshadowing the future profile of its operations.
Going for growth in the right place at the right time
Beyond the frontiers of its traditional mature markets, Groupe SEB has, since the 1990s, been
putting down roots in fast-developing regions and countries where prospects for growth are
particularly bright. This foresight has earned it first-rank status in several of these markets
today, where it can now profit from its strength. While this path to growth is not always smooth,
the ups and downs encountered in these countries – at times victim to political or economic
instability – do not distract the Group from its long-term ambition to build itself a solid base
in targeted growth markets.
27
SAUDI ARABIA, FRUITFUL COLLABORATION
In Saudi Arabia, the Group has been developing a highly-valued working partnership with Bakhashwain, exclusive import
and wholesale agent for the Group’s products in the Saudi Kingdom. Long-time distributor of Tefal, today this company
handles all our brands (Moulinex, Rowenta, Krups and Lagostina). Its role goes well beyond that of importer. With a team
of some 50 staff dedicated to Groupe SEB products, its functions cover distribution, marketing and logistics. This collaboration,
co-managed from Dubai by local Groupe SEB Export teams, is helping us to consolidate our positions in this market and set
our sights on more ambitious goals.
With this in mind, being ready to act at the right time is vitally important. Thus it was that
we could profit from Russian growth between 1993 and 1997. While the Group had to cope with
the collapse of this economy in 1998 and 1999, we were among the first to benefit from Russia’s
recovery, so that the Group is leader in this market today. Likewise, convinced of the high
potential of South America, a region which was inaccessible from outside because of customs
barriers, the Group acquired Brazil’s Arno in 1997-98. Despite initial difficulties, this investment
has proved to be strategically relevant and profitable. Today, Ukraine is entering a growth
phase...Groupe SEB is there. The economies of Belorussia, Estonia and Lithuania are beginning
to stir...the Group is there too. Eager to be present in new territories where there is so much to
be done, we are setting up sales offices or marketing subsidiaries in countries such as Vietnam,
Thailand, Singapore and Taiwan. And if necessary, as in the case of China, other solutions can be
found. It is in this sense that the plan to acquire a majority stake in the Chinese company, Supor,
is a major strategic step for the Group.
After market conquest, generating growth
New market penetration is a delicate operation which can be decisive for a brand image
and future business development. So, it is vitally important to succeed at this stage by starting
with a strong offer that highlights product quality and the ingenuity of Groupe SEB solutions.
Particularly suited to this purpose are our cookware and linen-care products – dry irons, steam
irons and steam systems – as they meet basic home needs that are universal. The spread
of these products, which is often rapid and effective, gives the Group a solid platform on which
to build up its offer. The time taken to achieve this, which varies case-by-case, depends
on the local reputation of the brands, and is built around four priorities:
• introduction of global concepts that meet a demand for Western standards through,
for instance, personal-care appliances or espresso coffee makers;
UKRAINE, A NEW DYNAMISM
28
• Independent since 1991 • An area almost as big as France • A population of 51 million
• An open and vibrant market, growing rapidly and modernizing
Groupe SEB, which has had a representative office in Kiev for many years, strengthened its base there at the end of 2006
by setting up a marketing subsidiary, Groupe SEB Ukraine, to take care of commercial operations (local stock supplies
and sales), while administrative functions will be handled by our Russian subsidiary. Greater control of distribution channels
and better flow management are the first benefits of this new structure, initially in cookware, and then in electrical
products to be phased in between April 2007 and the first quarter of 2008. By funding local advertising and marketing
(TV adverts, product demonstrations, etc.), Groupe SEB is building itself a solid and promising base in Ukraine.
INTERNATIONAL
• adaptation of our products to local culinary practices and customs (variable shape and depth
of frying pans and saucepans, an ‘areperia’ sandwich maker for Venezuela, an electric tea-pot
for Turkey, a special barbecue for Korea...);
• strategic deployment of the Group’s brands, whether international (Moulinex, Tefal and
Rowenta in middle ranges, All-Clad, Krups and Lagostina in upper ranges) or regional brand
leaders (Arno and Panex in Brazil, and Samurai in Colombia);
• multi-format distribution, with internationally expanding big modern retail chains working
alongside local retail networks and traditional neighbourhood stores close to the consumer.
South
America
Our biggest international successes have been built in this way: in central Europe and the CIS
countries where sales growth is now driven by all product families and retail formats; in Turkey
+21%
where the recent launch of haircare appliances stimulated sales; in the Middle East where
the Group has been reorganizing its marketing structures and filling out its product offer over
INTERNATIONAL
the last 18 months; in Mexico, South Korea and in many other countries.
Blenders_ Krups and Moulinex
THE BLENDER SHAKES THE WORLD
The blender is very much in fashion today and its use is spreading rapidly around the world in answer to
a growing demand for liquid and semi-liquid preparations such as ‘smoothie’ blends, cocktails and gaspachos.
World Number 2 in blenders, with about 12% of the market and some 5 million sold in 2006, Groupe SEB holds
trump cards in this product area:
• its factories are close to the regions where blender use is most common (Brazil, Colombia, Mexico);
• using a Group-wide approach, we have designed and developed special functions to match culinary practices
in different countries: accessories for the Peruvian Pisco cocktail, an integrated spice grinder for the Middle
East, and a filter spout for cocktails.
STÉPHANE BETTONI,
Marketing Strategy
Manager,
Food-preparation
appliances.
This ability to adapt and re-interpret the product is a strong point of Groupe SEB. It reflects our global market
outlook and flexibility, even in the face of local rivals. Another fine example of the Group being close to its
customers!
29
Acting for tomorrow
means
INVENTING
THE WINNING COMBINATION
A blend of attractive brands, aesthetic
high-performance products and the right retail
channel is the winning combination for a successful
encounter with the consumer. By acting on
a clear-cut strategy of differentiated product
ranges with complementary strengths, while
avoiding internal competition, Groupe SEB is seen
as a benchmark standard in its industry today.
UNRIVALLED BRAND ASSETS
The Groupe SEB brand portfolio, clearly positioned and differentiated, is a highly valuable asset
30
which is being constantly enhanced. Whether these brands serve as a vehicle for the Group’s
ambitions on a global scale – Krups, Lagostina, Rowenta, Tefal and Moulinex – or on a regional
scale – All-Clad, Arno, Calor, Panex, Samurai, Seb, Mirro WearEver – each asserts its own
values, evoked in its product assortments, functional features, design themes and advertising.
Our multi-brand strategy, fuelled by dynamic innovation and deployed through a whole variety
of retail networks, means we can deliver a comprehensive product offer adapted to a multitude
of consumers around the world.
‘Dolce Gusto’_ Krups
BRANDS/INNOVATION/DISTRIBUTION
In 2006,
more than
31
170 million products sold
97 new patents.
Outstanding brands
KRUPS
This brand is aimed at a double profile: people with a taste for technology and a liking for status
symbols. Krups products instantly evoke precision, perfectionism and eloquent enthusiasm.
They are semi-professional machines, rigorously designed for the connoisseur or the expert who
appreciates high-tech functions and the ritual of coffee preparation. The advertising theme
highlights the product and appeals to the emotions.
ALL-CLAD
In premium-quality cookware, All-Clad evokes professionalism, authenticity and prestige.
In this, it complements the Krups brand image. Evoking the world of leading chefs,
its collections of kitchen utensils are objects of admiration for devotees of high culinary
standards. They conjure up a timeless aesthetic aura around traditional shapes and noble
materials. Classic advertising media are not for them: All-Clad products are promoted through
public relations events starring well-known chefs.
LAGOSTINA
Tasteful living and a perfect balance between tradition and modernity are two dominant
Lagostina themes. The brand asserts its Latin roots with elegant cookware ranges and artistic
tableware. Choice materials and sensual shapes evoke an art de vivre which is uncompromising
on culinary excellence. Lagostina advertising is focused on people and the pleasure of eating,
conviviality and culinary refinement.
32
ROWENTA
This brand appeals to people in quest of modernity, meaning and harmony. Its philosophy
embraces high standards, intelligence and aesthetic quality. Geared for day-to-day wellbeing,
Rowenta’s designer products are equipped with advanced functional features subtly presented
in sober architecture. The best of technology, discrete and impeccably finished. The Rowenta
advertising message evokes an allegorical universe of serenity and superior product
performance.
Symbolic and friendly brands
TEFAL
Evoking day-to-day life and a caring home atmosphere of sharing and sentiment,
Tefal stands out for its creativity. Whatever the product domain – cookware, linen care or electric
cooking – Tefal puts ingenuity into useful and efficient products for people who enjoy a domestic
task well done. The clever features of the product are instantly seen and easy to understand.
The brand’s TV advertising wittily shows how a Tefal appliance can transform a ‘chore’ into
a light-hearted task in an ambience of generosity and ‘joie de vivre’.
MOULINEX
Moulinex identifies with busy people who want to be free of the constraints of daily household
tasks. It offers them simple, rapid and easy-to-clean products that are usable by any member
of the family. Youth and freshness are thematic of Moulinex ranges, with touches of bright colour
TASTY AND HEALTHY COOKING, THE EXPRESSION OF A BRAND
In response to growing interest in healthy eating, the Group has created new tasty and healthy ways of cooking
with its Nutrition Gourmande range which combines gastronomy and balanced diet. There are three appliances
in this new range:
• Actifry, a new-generation electric fryer to make tasty French fries with just one spoonful of oil, thanks
to two unique patented systems: the use of hot air in the cooking chamber and a mixing paddle to guarantee
even cooking;
underlining their efficient functions. The brand’s advertising is daring and dynamic.
• VitaCuisine, a steam cooker with three separate compartments for simultaneous cooking of fruit or vegetables
while preserving their vitamin content;
• VitaDelice, a table-top oven with a highly efficient steam-cooking mode to preserve the vitamins, texture,
XAVIER SABOURIN,
Brand Strategy
Manager.
colour and taste of vegetables, fruit or fish.
Resonant of the brand’s themes of ingenuity,
generosity and love of life, the Nutrition
Gourmande range is sold under the Tefal
label in international markets and under
the Seb brand in France.
‘VitaDelice, Actifry, VitaCuisine’_ Seb/Tefal
33
‘Simply Invents’_ Seb/Tefal
‘Quick & Hot’_ Tefal
INNOVATION, A SPUR TO GROWTH
Giving added value back to entry-level products
Faced with enormous competition from cut-price products, the Group decided to concentrate
its efforts on the upper end of this entry-level segment by creating added value. Already in 2005,
200 new
products
and models.
the Group launched Principio by Moulinex, a targeted range reflecting the brand’s values
of simplicity, rapidity and ease of use. Comprising 18 products, this range helped us win back
the initiative in this segment with sales of €45 million in 2006. Taking advantage of this success,
we are launching a new Group-wide range in 2007, positioned a little further up-market and
starting with about a dozen products. The range is called Simply Invents. A colour highlight
on each product draws instant attention to the ingenuity of Tefal functional features.
Animating and stimulating middle ranges
In middle ranges – territory long familiar to the Group – we have proved our ability to invent
useful solutions to simplify daily life for consumers. Our continuing R&D effort in mid-range
products ensures the renewal of existing ranges with new models while paving the way
in new directions.
In cookware, Tefal continues to develop its space-saving ideas. After the success of Ingenio
clip-on handles, stackable utensils and folding handles (Compact and Clipso pressure cooker),
the Group is launching a new generation of practical and ergonomic equipment.
In food preparation, after blenders and centrifugal juice extractors, product development in 2006
34
was focused on beverage preparation. One of the pillars of its international business, the electric
kettle offers a variety of special features depending on the market and brand: compact capacity,
heat pre-selection, stainless steel or floral finish, or an inside light... A similar but original
concept, the Quick & Hot is unique for its extra function as an instant hot-water fountain.
Coffee preparation is another area where the Group has conquered strong global positions
with ranges of filter and espresso coffee makers (pump, combi or fully-automatic) with rigid
or flexible dosing systems, appreciated by consumers for their practicality.
‘Juice machine’_ Moulinex
In electric cooking, our long-standing expertise makes us a market front-runner. A crowning
success of 2006 was the breadmaking machine, the sign of a return to traditional tastes, now
aided by efficient fully- automatic systems. Another important development – combining healthy
cooking with eating pleasure – is very much in vogue with the Nutrition Gourmande range which
includes the Group’s revolutionary Actifry electric fryer.
In linen care, the Rowenta and Tefal brands are doing a splendid job of keeping the Group at the
top. Rowenta’s technical advances (garment dewrinklers, water-level indicator light, improved
steam power and distribution) have earned it excellent scores in several markets with the
Advancer and Focus irons, and the Water Control and Home Pressing steam systems.
Floor care products gained momentum from a strong innovation dynamic in 2006 with two
outstanding flagship products: the Intens compact, bagless vacuum cleaner, and the Shock
Absorber vacuum cleaner made with a unique recyclable material which is tough and ultra-light
and absorbs impacts with obstacles. At the start of 2007, the new innovative Silence Force took up
the challenge of coupling greater silence with hoovering power.
Personal care products continued to gain ground in international markets with constantly
renewed ranges focused on stylish design and personal wellbeing. This expanding business
‘Intens’ vacuum cleaner_ Rowenta
is driven by the success of haircare appliances, in particular certain showcase products such
High-status ranges
For the Group’s premium-quality brands – All-Clad, Krups and Lagostina – innovations are more
targeted and designed to meet very high standards. Thus, when All-Clad extended its offer
to electrical products (the slow-cooker and skillet, specifically for the American market)
it maintained the brand’s traditional standard of superior quality and performance worthy of great
kitchens. Krups launched an Expert food preparation assortment (blender, food processor
and kitchen machine) with a unique motor technology and exclusive integrated weighing function.
Meanwhile, capitalizing on its well-known expertise in coffee machines, Krups launched
the Espresseria automatic coffee maker with precision controls to make an excellent espresso
instantly and directly from fresh coffee beans. Lagostina developed a Lagoplan manufacturing
process to make the base of all its cookware products more resistant and efficient on all cooking
surfaces.
as the Lissima hair smoother and the Brush Activ blow-drying hairstyler.
35
‘Prélude’ kettle_ Rowenta
Frying pans_ Emeril
‘Salsa’ with Lagoplan base_ Lagostina
‘Water control’_ Rowenta
‘Tendancy Glass’_ Tefal
Dynamism in partnership
Opening up to other sectors and joining forces with other experts in their field is necessarily
enriching. Hence, for some years now, the Group has set out to identify specialist areas in which
to develop alliances in technology and public relations.
In the area of technology, Krups is today number 1 partner of coffee specialist Nespresso.
Its most recent venture under this alliance, ‘Le Cube’, got off to a promising start at the end
of 2006. Krups has also teamed up with Nescafé to launch Dolce Gusto, a new standard
220,000
‘Dolce Gusto’
sold in
three months.
in multi-coffee systems able to make espresso, café latte and cappuccino. Groupe SEB has also
formed links with beer specialist Heineken to market the BeerTender, the first home
draught-beer system with a recyclable keg. A huge success in The Netherlands and Austria,
the product has been very well received in France.
In the area of public-image promotion, the Group has enlisted famous trend-setter names to give
more impetus to its sales: top chefs Emeril Lagasse and Jamie Oliver in cookware, and
the prestigious Elite label in haircare appliances.
JAMIE OLIVER, TALENT AND ENTHUSIASM
British chef Jamie Oliver is famed for his creative and enthusiastic cooking, which ties in well with the Tefal brand image.
Bringing the two together seemed obvious. So, since 2003, Tefal has sponsored Jamie Oliver TV spots and live shows.
The impact was immediate and powerful. Jamie has raised the status of Tefal cookware with the introduction of new
materials (stainless and anodized steel), opening new doors to selective retailers. Since 2003, we have sold over a million
36
products under the label, Jamie Oliver by Tefal, mainly in Scandinavia, Great Britain, Australia and Canada.
‘Anodized Range’_ Jamie Oliver
A CHANGING RETAIL WORLD
Adapting to multiple retail formats
Adjusting distribution strategy to local conditions is another key factor of success. From one
country to another – for historical, economic, social or regulatory reasons – retailing takes many
different forms:
• in mature markets, it is generally highly organized and often concentrated around big modern
chains that command considerable negotiating power; other key players include specialist
retailers and department stores, while alternative channels are steadily expanding;
• in emerging markets, distribution is often less structured, with major international retail
chains moving in to operate alongside perhaps thousands of disparate traditional outlets
that ensure widespread and detailed coverage of a territory.
We have identified 18 different retail formats (of the most frequently-found sort) around
the world. Every one of these presents an opportunity for the Group, and must be approached
Building up our presence in all channels
Our brand portfolio gives us a first-rate strategic tool to shape a coherent approach to
this complex situation. With brands aimed at different retail circuits, and a need to bolster our
presence in new types of sales channel, the Group has decided to emphasize differentiation.
How consumers relate to different points of sale is determined by criteria such as price, choice,
customer advice, service and proximity. These factors can easily be matched up with our
different brand profiles. With this in mind, we have developed and deployed three distinctive
approaches: selective, generalist and pioneer. The Group’s upmarket brands aim for selective
outlets with a tailored marketing approach and exclusive assortments, while mid-range products
are distributed through mass-market channels and specialists outlets. The Group is also
Casa Lagostina_Cagliari
Casa Lagostina_Marne-la-Vallée
assigning new resources to develop sales through alternative channels such as telesales, mail
order, online selling, and the Group’s own brand stores.
Home&Cook_ Cholet - France
THE GROUP’S OWN RETAIL BANNERS
Almost 10% of Group sales are achieved through alternative retail channels. These include 174 stores worldwide which
sell only Groupe SEB products – 104 of these being Tefal shops in Turkey. The Group also runs some 20 other stores under
the Casa Lagostina and Home & Cook banners. These ‘factory-to-customer’ direct outlets, which sell all the Group’s
brands, are currently being expanded (four new openings at the end of 2006 in Spain, Ireland, The Netherlands and
France). More openings are planned around the world this year.
in the appropriate way.
37
Acting for tomorrow
means
ADAPTING
TO THE REAL WORLD
In a market of constant challenge, being
competitive is a first priority for Groupe SEB.
Keenly aware that meeting this challenge is vital to
its long-term growth and performance, our Group
has adopted a strategy of non-stop progress that
combines useful innovation, greater industrial
efficiency, strict cost control and optimized
logistics.
INNOVATION AT THE CORE OF OUR STRATEGY
Innovation is a prime growth lever. But is there anything left to invent in the small domestic
equipment sector? The answer is certainly yes. There is still room in the market today for truly
novel concepts that offer consumers added value. There is no lack of good recent examples
38
of success in this area by Groupe SEB or some of its more dynamic rivals.
‘Espresseria’_ Krups
Prospering still on the pioneering spirit of the early days
Groupe SEB’s eventful history has been built on a wealth of creative effort, still constantly
renewed and re-invented through the talents of its employees. The big challenge today
is to develop innovations which are truly useful to the consumer while they generate business
growth for the Group. This calls for close links between R&D and marketing.
BEING COMPETITIVE
BEING COMPETITIVE
7 out of 10 products
are made in Groupe SEB factories.
39
Faced with the continued lowering of standards in the small domestic equipment offer,
the strategy of Groupe SEB is to concentrate on added value, and thus elevates its market stance
in relation to rivals. This approach is evident in some of our recent leading-edge products:
the new Shock Absorber vacuum cleaner, a convergence of technologies and new materials
that make it powerful, ultra-light and practical with its exclusive shock-proof structure;
the Espresseria fully-automatic espresso coffee maker with its unique hydraulic control system;
the Quick & Hot, a new concept in instant hot water; the Actifry electric fryer – inspired
by interest in healthy diet – which can make tasty chips with just a spoonful of oil thanks
to techniques developed within the Group.
R&D budget
€46 million
1.7% of sales.
The Groupe SEB innovation dynamic continues to prove its worth.
Meanwhile, to meet the need for faster renewal of small electrical appliance ranges,
we introduced Product Lifecycle Management (PLM) which makes the design process more
470 staff.
efficient. With PLM, different teams working on a single project can share information and
monitor the progress of their project in real time. Finally, we are also developing Group-wide use
of our own technologies in areas such as heating elements and materials. This is generating
synergy benefits. A measure of the success of this multiple approach is our launch of 200 new
products and models in 2006.
Design unit_Is-sur-Tille - France
R&D laboratory_ Pont-Évêque - France
40
A PRO-ACTIVE INDUSTRIAL PATENTS POLICY
15 staff
A single objective: ensure maximum protection of industrial patents to enhance and preserve the value of innovation,
by both protection and intervention:
• filing and obtaining patents;
• settlement of litigation;
• anti-counterfeiting measures.
BEING COMPETITIVE
Protecting assets
Innovation, which is a long-term investment, must be protected and defended against
counterfeiting if it is to be effective. Groupe SEB has a bulky portfolio of patents to which it adds
an average of some 85 new patents each year – ranking it France’s 22nd patent filer. The 2006
trading year was a fruitful year in this respect with 97 new patents obtained. A preliminary
notification process, the so-called enveloppe Soleau, prior to actual patent filing (which is costly)
makes it possible to date an idea and study its feasibility before carrying it further. Groupe SEB
filed 275 of these notifications in 2006 – half of which could lead to a new patent. Concurrent with
this, the Group also ensures protection of its brands (name, logo, graphic theme) which carry
the flag for its international expansion, and product models (protection of a product’s appearance
Assembly line_
Saint-Jean de BournayFrance
and shape for 25 years).
However, these pre-emptive steps are not always quite enough. Because of the leading status
of our brands and the success of our products, we must constantly battle against copying and
counterfeiting. Most of our actions are taken in China which is noted for such problems, though
the situation is gradually improving. Indeed, while the Group has seen a visible decrease in
the number of fake products appearing at trade fairs, it nonetheless had to arrange for several
Laboratory_ Arno - Brazil
BEING COMPETITIVE
substantial counterfeit seizures in 2006.
Assembly line_ Selongey - France
AIMING FOR EXCELLENCE
Innovation is at the heart of the Group’s success because it gives it real competitive advantage
and momentum for its future growth. But this must also be accompanied by solid operational
advances in the overall productivity of our industrial base, and by improved quality of service
for retail clients and consumers.
41
A more efficient industrial base
Unlike most of its competitors, Groupe SEB manufactures some 70% of the products it sells.
Its industrial base is still strongly rooted in Europe, where it operates 13 factories. The profound
changes in the market, seen notably in the rapid spread of low-price competition in certain
product families, led the Group to step up its industrial restructuring in France by deciding
at the beginning of 2006 to close three plants (Fresnay, Dampierre and Vosges) and to downscale
the Vernon vacuum cleaner factory.
Clearly, the objective of these difficult measures is to reduce fixed costs and convert them
into variable costs by, for example, making greater use of outsourcing or sub-contracting.
The restructuring plan, which will be fully effective by the end of this year or early in 2008,
should generate substantial savings.
The Group has already announced conversion plans for the Dampierre (Jura) and Le Syndicat
(Vosges) plants, having managed, more quickly than expected, to sign agreements on the
take over of these two factories. Solutions for the Fresnay plant are currently under study.
Once again, the Group emphasized the strategic importance of:
• strong centres of expertise in Europe which benefit from substantial economies of scale while
developing processes and technologies that contribute to added value;
• dynamic international factories with steadily rising production, acting as relays for our global
expansion;
• recourse to outsourcing, with the use of a dedicated and secure real-time purchasing structure
to manage dealings with our main suppliers.
Assembly line_Pont-Evêque
Savings on purchases
Purchasing is another key area for reducing costs. The global scale of Groupe SEB means it can
exploit its buying power with the cooperation of its suppliers, and thus make substantial savings.
Plainly, the Group has this perspective in mind when it determines its purchasing policy. On the
basis of a panel of approved suppliers which the Purchasing department reviews regularly and
recommends to the subsidiaries and production sites, the Group develops co-operative working
relations with its suppliers. This co-operation aims to share the R&D effort and improve general
supply conditions: price, quality, reliability, on-time delivery and technological advances. In place
since 2000, this policy has proved its merit in tandem with standardized production, global
€690 million
in direct industrial
purchases.
sourcing, and increased ordering from low-cost countries. These arrangements were however
not enough to offset the strong rise in the prices of raw materials in 2006, including an average
of +15% for aluminium, +7% for steel and +30% for copper. In these circumstances, the rise
of 2.6% in direct purchases in 2006 was quite a good performance, and reflects gains made
in other categories.
42
TEFAL COOKWARE AT RUMILLY, A THRIVING BUSINESS
• A record of 51.7 million articles of cookware produced in 2006 • 80% of production sold in export markets
• Annual capital expenditure: €15 million
• 31,500 tonnes of aluminium a year • 1,800 tonnes of nonstick coating a year
• Recognized expertise in surface coating
• Two logistics platforms (for France and Export markets) for an annual throughput of 380,000 palettes or 15,000 trucks.
BEING COMPETITIVE
BREAKDOWN OF 2006 PURCHASES
Metal and metal components 24%
Sourced finished products 35%
Plastics and plastic parts 14%
Sundry 8%
Packaging 6%
Electrical and electronic components 13%
Improving flow management, streamlining structures
The Group’s international expansion generates high flows and stock levels due to more
finished-product sourcing, growth in distant export trade, retailer demands for virtual just-in-time
delivery and other factors. If stock levels are not kept under control, this could lead to
a continuing burden on working capital. The Group strives to counter this trend with rigorous
inventory management by working upstream with its clients and suppliers to anticipate needs,
and by optimizing its logistics organization. In this area, 2006 saw the setting up of a single
uses a single national platform for France (based in Rumilly). The Mions warehouse is
specialized in exports.
The Group also made fresh progress in the deployment of information systems for
its subsidiaries, thus accelerating their convergence. It integrated its recent acquisitions into
the Group IT system and continued to rationalize its organization by creating administrative,
Factory_Shanghai
commercial and logistics management platforms for clusters of markets, and by setting up
Shared Corporate Services Centres.
BEING COMPETITIVE
distribution platform for small electrical appliances in France (based in Orléans), which will also
serve as the logistics platform for the Belgian market in 2007. In cookware, the Group already
43
R&D Laboratory_ Mayenne - France
Factory_ Rumilly - France
SUSTAINABLE DEVELOPMENT
‘
44
‘
Aware of the challenges of today,
let us innovate for a better future
Acting for tomorrow
means
PROGRESSING
ALL THE TIME
44
52
60
70
76
VISION, PRINCIPLES, ORIENTATIONS
45
VISION AND PRINCIPLES
CHRISTIAN COUTIN, Vice-President of Sustainable Development
“Globalization is shifting the centre of gravity of our business to emerging countries. This requires Groupe SEB
to adapt its strategy, particularly in manufacturing, while pursuing its commitment to sustainable development:
in Asia, which accounts for a growing share of our purchases, the Group ensures that suppliers respect labour
rights and environment standards. In Europe, where it is having to close some factories, the Group is doing
everything possible to support the affected staff. Meanwhile, to accompany its international expansion,
the Group is applying a set of worldwide corporate guidelines based on the Global Compact.
The Group’s approach to sustainable development is also seen in its attitude to social change in general as well
as within its working teams: an ageing labour force brings new challenges in the drive to reduce work accidents
and industrial illness, while the Group’s desire to promote diversity is seen as an opportunity and a source
of dynamism and creativity.
In phase with the concerns of civil society on social and environmental questions, today’s consumers show
a preference for ethical products. Distributors relay this demand, which the Group sets out daily to satisfy
in partnership with its suppliers. A growing number of shareholders emphasize corporate accountability,
a theme which is fully in line with the philosophy of Groupe SEB.
CHRISTIAN COUTIN,
Vice-President of
Sustainable Development.
Respect for the environment is a mainstay of sustainable development. It is also a central concern of Groupe
SEB, which seeks to reduce the environmental impact of its products throughout their life-cycle.
Groupe SEB intends to take up all these challenges, in keeping with its corporate values.“
CHALLENGES FOR GROUPE SEB AND
Managing Groupe SEB sustainable development
Since 2004, the Groupe SEB Sustainable Development Division has been coordinating and
motivating a Group-wide participative effort in this area. This effort is supported by a Sustainable
Development Steering Committee comprising representatives of the main areas of Group
activity. It defines priorities, draws up master plans for projects and monitors their progress.
It serves as a source of ideas and an advocate for sustainable development within the Group
and with external working partners. The Group Executive Committee agenda regularly features
46
an update and discussion on aspects of sustainable development.
Information and exchange tools
The Group uses a range of in-house media to heighten staff awareness and stimulate exchange
in this area:
• a sustainable development brochure created in 2006 and distributed to the Group’s working
teams;
• a dedicated website also created in 2006 (www.groupeseb-devdurable.com) and an e-mail
address for people outside the Group (sustainabledevelopment@groupeseb.com);
• a dedicated forum on the Group’s Intranet which allows employees to put questions or give
their opinions;
• the in-house electronic newsletter, Globe News, which reviews developments in this field.
In 2006, sustainable development was included as a subject in management training.
COMMITMENTS
Groupe SEB’s commitment
Loyal to its corporate values, Groupe SEB has joined international and French partners
in several initiatives to promote sustainable development:
• the UN Global Compact, signed at the end of 2003 – (www.unglobalcompact.org);
• the Code of Conduct of the CECED (European Committee of Domestic Equipment
Manufacturers) signed in August 2005 (www.ceced.org);
• the Diversity Charter, signed in France in October 2005.
As part of the progress-reporting expected of Global Compact signatories, Groupe SEB posted
a Best Practices example on the UN Global Compact website in 2006: our product design policy
The Global Compact and Group procedures
At the end of 2006, sustainable development principles were already formally integrated into
12 of the 14 main Group corporate functions: relevant directives were adapted and performance
indicators were put in place where possible. Meanwhile, the internal control team drew up a list
of monitoring criteria based on Global Compact principles, which it has begun to include in
internal audits.
emphasizing respect for the environment (principles 7,8 and 9 of the Global Compact).
QUALITY, SAFETY, ENVIRONMENT, LABOUR RIGHTS: CONVERGING GOALS
“Millville is a huge logistics platform which supports Groupe SEB operations in North America. It receives,
stocks and distributes the Group’s products and manufactures T-Fal cookware, as well as handling after-sales
service for the different brands. In 2006, we were awarded the ISO 14001 certificate for our environment
management system and the OHSAS 18001 health & safety certificate. We already held ISO 9001 quality
certification. This triple recognition reflects an ongoing drive for improvement in line with the Group’s
commitment to the Global Compact. The results are there to be seen: in just five years, our accident rate
has been halved, and accident-related costs have been cut 20-fold. We have also made solid progress on
CAMILLE HÉBERT,
General Manager, Millville,
Operations and Logistics
HQ (USA).
the environment, particularly in recovery of stocks returned by clients: last year, 66% of these returns were
checked, re-packed and sold through specific channels, compared with only 26% in 2003. Pursuing
these improvement efforts, we are now working to obtain SA 8000 recognition, an international standard
in labour rights.”
47
CORPORATE GOVERNANCE
Closely attentive to the interests of its shareholders, Groupe SEB has always been vigilant in
the application of good corporate governance practices. It ensures management transparency
and real powers of control by the Board of Directors.
Real powers of control
A collective body, the Board of Directors represents all the shareholders and acts solely in
the interests of the company. On the proposal of the Chairman and Chief Executive Officer,
the Board of Directors decides on Group strategy and capital expenditure, and deliberates
on Group management structures and acquisitions. To ensure the interests of its shareholders,
the Groupe SEB Board includes four independent directors as defined by the Bouton report, i.e.,
they have no relations with the company, the Group or its management which could compromise
their impartiality.
Evaluation of the Board
In compliance with the recommendations of the Bouton and Vienot reports, the Board
of Directors reviewed its functioning for the fourth consecutive year at the meeting
of 15 December 2006, under the guidance of the Nominations and Remuneration Committee.
The Board considered that there had been a marked improvement in its functioning since
the previous evaluations, notably in the preparation and conduct of meetings. The directors
considered moreover that discussions and presentations made by the Group’s operational
management were of high quality.
GOOD PRACTICES
48
• Adherence to the Director’s Charter and Internal Rules.
• The presence of four independent directors on the Board in 2006.
• Directors’ term of office limited to four years.
• Renewal of Board membership by rotation (3 or 4 per year) to give greater say to shareholders.
• High member participation: nine Board meetings in 2006 with 90.4% attendance.
• Information: each new Board member is given a full dossier on the Group, and regular detailed information throughout
the year; since 2006, a documentary database for Board members is available on the Internet.
• A meeting of the Board at a Groupe SEB site outside France (in Italy in 2006) so that members can meet working teams
and better understand local problems.
The Board of Directors operates two specialist committees drawn from
its members:
The Audit Committee, comprising three members (of which two independent directors,
including its chairman) informs the Board of Directors on the main risks facing the Group.
2
Committees:
out of 3
members are
independent
directors.
It ensures the conformity of financial reporting methods and participates in the preparatory
procedure for appointing statutory auditors.
The Nominations and Remuneration Committee, comprising three members (of which two
independent directors) makes recommendations on the composition of the Board, the terms
of office of directors, and Group organization and structures. It also makes recommendations
on executive remuneration, and on the terms and conditions of share subscription and purchase
option schemes.
Directors' Charter and Internal Rules
Drawn up to ensure that Board members have a clear understanding of their role, rights
and duties, the Directors’ Charter sets out rules on respect for and defence of the interests
of the company, regular attendance at meetings, attention to possible conflicts of interest,
access to information, confidentiality, objective analysis, and vigilance with regard to the
regulations governing privileged information.
of the Board and its committees, and policy on the remuneration of Board members.
Keeping Board members informed
Since 2006, a documentary database for directors has been available on the Internet.
This includes all the information which is periodically sent out to directors, such as press
releases, Board meeting reports, published studies concerning the Group, and monthly sales
data. It also includes comprehensive information on the Group and its trading environment.
100-
The Internal Rules cover the make-up and functioning of the Board, the role and mission
75-
VIGEO RATING
50-
• Panel min./max. (sector)
• SEB
250Human
resources
Environment
Market
performance
Corporate
governance
Social
commitment
Human rights
GROUPE SEB RATED BY VIGEO
For the second consecutive year, Vigeo, the independent corporate social responsibility (CSR) rating agency, produced an
unsolicited report on Groupe SEB in 2006, based on a new business sector panel (Technology and Hardware). Vigeo drew
attention to the good progress made by the Group, particularly in the environment. Groupe SEB is rated well above the panel
average in human rights, environment, human resources, conduct of business and community involvement. It is less well noted
for corporate governance, mainly because of family shareholder Group control and the view that the number of independent
directors is insufficient.
49
PRIORITIES AND ACTION PLANS
for the next three years
ETHICAL
Priorities
Working objectives
Main achievements in 2006
Sustainable development website and
Involvement of employees in Ensure employee awareness of our
the Group's ethical approach commitments under the Global Compact, brochure.
the CECED Code of Conduct and the
Diversity Charter.
Next steps
Master document on the Group's ethical
approach.
Apply the ethical commitments of the
Group in its day-to-day operations.
Integration into 12 of the 14 Group’s key
corporate functions.
Further integration into internal control
procedures.
Monthly reporting system and priorities
for progress.
Monthly reporting for the French sites;
quarterly reporting for international sites
– consolidation and analysis.
2007: creation of a Health & Safety
function within the Group.
Action plan to cut work accidents and
industrial illness (repetitive strain injury).
France: reduction of about 20% in the
frequency and gravity of industrial
accidents.
2007: a further reduction of 20% in the
frequency and gravity of industrial
accidents in France.
CORPORATE
Improvement of health &
safety at work
Promotion of diversity
Ensure greater diversity in working teams. France: Diversity Charter follow-up
committee; action plans and start-up
(information; training of HR teams).
Group-wide Fair Process management
Development of
management in keeping with reference framework.
our corporate values
Support for employees
affected by industrial
reorganization
Ensure that any job-cuts needed are
carried out with every consideration for
the individuals concerned.
Use training to prepare for and enhance
future employability.
Continue to implement the Diversity
Charter action plan.
Reinforcement of Fair Process training.
Continue to encourage the adoption of
Further development of ‘180°-evaluations’. Fair Process by all managers.
France: closure of three factories.
Individual support for affected staff and
re-industrialization of sites: potential
solutions at the end of 2006 for 98% of
staff.
To limit the social impact of restructuring
by ensuring fair treatment.
France: strengthened partnership with
Habitat et Humanisme, the Second
Chance Foundation, and Envie.
Creation of a Groupe SEB Enterprise
Foundation.
Brazil: new community education project
for the unemployed (Arno).
To build up existing social partnerships
and create new ones
(France and international).
SOCIAL
50
Structuring of the Group’s
sponsorship strategy
Projects focused on the combat against
social exclusion.
ORIENTATIONS
Priorities
Working objectives
Main achievements in 2006
Next steps
Global Compact and the CECED Code of
Conduct criteria added to the Group’s
purchasing conditions.
To follow through and verify sustainable
development commitments by suppliers.
Environment statement: returned by 46%
of the supplier panel.
70% response rate by end of 2008.
20% of the supplier panel certified ISO
14001.
45% of supplier panel by end of 2008.
Eco-statement (non-use of hazardous
substances) signed by 99% of our
suppliers (100% RoHS-compliant).
31 follow-up inspections.
Strengthen follow-up inspections.
Meet our commitments in the area of
working conditions.
SA 8000 social accountability standard
covered 100% of purchases in Asia.
31 follow-up inspections.
Extend to 80% of purchases made in South
America by 2008.
Strengthen follow-up inspections.
Improve our services to consumers.
Improvement of our customer welcome
service in France.
Improve customer welcome and after-sales
service in Europe.
Ensure the best possible service for our
retail clients.
France: 90% service-satisfaction rate
maintained and logistics structure
streamlined.
Aim for 95% service-satisfaction rate in
France and extend this quality worldwide.
Involvement of its suppliers Keep suppliers fully informed on the
in the Groupe SEB
Groupe SEB sustainable development
sustainable development
effort.
effort
Meet targets for progress in protecting the
environment.
Satisfying clients and
consumers
ENVIRONMENT
Reducing the impact of our Apply eco-design procedures.
products on the
environment (eco-design)
Make products more easily recyclable
and repairable.
Reduce product power consumption
during use and on stand-by.
Eco-design rules (2003 version) applied to 100% of products compliant with eco-design
100% of product development projects.
rules (including sourced products).
Potential recycling rate of over 70%
achieved for new products.
Over 75% of new products potentially
recyclable.
75% of products repairable.
Maintenance of repairable rate.
Average power used by new products in
stand-by mode: less than 3 W in 100% of
cases, and less than 2 W in 35% of cases.
Greater energy efficiency for equivalent
performance,
and stand-by power below 2 W.
81% of factories ISO 14001 certified.
Ensuring that all the Group Aim for ISO 14001 certification of all the
Group's factories around the world.
sites respect the
environment (ecoUse environment performance indicators. Objective achieved (with the exception of
production)
new acquisitions).
Reducing carbon dioxide
emissions from transport
(eco-logistics)
ISO 14001 certification for all factories
acquired more than five years ago.
To define environment objectives factory-byfactory.
Better control of carbon dioxide emissions. Pursuit of reflections on the environment
with the Club Demeter think tank.
Proposal for a set of performance
indicators for transport.
Full-scale tests using transport
performance indicators.
Explore non-road transport alternatives
and aim for optimum loading rates for
road haulage.
To aim for worldwide application of criteria
for alternatives to road haulage, and a roadhaulage loading rate of over 90%.
France: 92% loading for road haulage
maintained.
51
Rotterdam-Basle transport by rail.
Disposal of end-of-use
products
ORIENTATIONS
CLIENTS/SUPPLIERS
Contribute to the collection and recycling Contribution to setting up Eco-Systèmes in Follow-up of eco-organizations in Europe
of end-of-use domestic electrical products France, and participation in the creation of and review of WEEE Directive
through the creation of eco-organizations. other eco-organizations in Europe.
implementation.
52
13,800 employees worldwide
of which
9,000
1,000
in North America
2,500
1,300
in South America
in Asia and other territories
in Europe
Acting for tomorrow
means
CONSIDERING
Groupe SEB working teams comprise
a total of some 13,800 women and men
spread over the four corners of the globe.
In view of today’s constantly changing
economic climate, the Group provides
support and guidance in career planning
for all its employees and works to ensure
good labour dialogue and fair treatment
for everyone.
255,800
hours of training
worldwide
EVERYONE
Globalization and social change
In the area of human resources, Groupe SEB is faced with two main challenges today:
globalization of trade and social changes mainly in Europe. While globalization threatens some
product families because of competition from low-cost countries, it also offers opportunities
to the Group in the markets of newly emerging economies. The consequent shift in the centre
of gravity of its business toward emerging countries, requires the Group to adapt and reorganize
its industrial base, particularly in France. Other important human challenges include the issue
of health and safety at work for the Group’s employees in the context of an ageing European
work population, and ensuring fair treatment that takes account of diversity in the make-up
of civil society. These are key issues at the centre of the Group’s human resources policy today.
53
Industrial reorganization in France
Early in 2006, Groupe SEB announced the reorganization of its industrial facilities in France
in order to remain competitive in the face of competition from Asia. The strategy of the Group
is to concentrate its French factories on innovative, high added-value products which can benefit
from economies of scale, while sourcing products such as hair dryers, filter coffee makers,
toasters and meat grills. This refocusing involves plant closures at Fresnay (Sarthe), Dampierre
(Jura) and Le Syndicat (Vosges), and rescaling of the Vernon (Eure) plant to produce top-range
vacuum cleaners.
Real support for employees
Loyal to its corporate values, Groupe SEB undertook to carry out this restructuring with full
consideration for its staff, and to offer each of them an adapted solution within two years.
Precedence was given to re-employment solutions within the Group: from the start, it was able
to offer every employee another job at a French site, and assistance with moving. It also set
in motion several measures for early retirement and supported any staff who had a personal
project. Current re-industrialization plans for the affected sites is another important means of
protecting jobs. Indeed, Groupe SEB was complimented on these efforts and its “good industrial
Assembly line
_ Pont-Évêque – France
relations” in a note issued by senior officials of the French Ministry for Employment and Industry.
Assembly line_ Arno – Brazil
Production line_ Mayenne – France
A SOLUTION FOR EVERYONE
54
“Groupe SEB used a pre-emptive approach to the French industrial reorganization plan to ensure that no
employee would be neglected. Thanks to this effort, we achieved what we set out to do: by the end of the year,
873 solutions had been found for the 890 staff involved, and other avenues were being explored for the
remaining 17.
In order to guarantee fair treatment for everyone in the companies affected by the plan, key elements were
handled at Group level: internal mobility and early retirement measures were negotiated with labour unions.
DOMINIQUE GALLOPIN,
Human Resources
Manager, France.
Intense – sometimes lively – dialogue with staff representatives was constructive, with all parties determined
to find a solution.”
Mobilizing energies
As revitalization of employment areas is a key concern for the Group, it made every effort
possible to encourage new industry at the sites marked for closure. This included working
By the end
of 2006,
with specialist outside consultants, public authorities, local politicians, and local chambers of
commerce and industry. On 16 October 2006, an agreement was signed with PSP* to take over
the Dampierre site, maintaining 62 jobs, most of which would give precedence to Groupe SEB
873
solutions
for 890
staff. By the end of 2006, fewer than 20 Dampierre employees still needed solutions.
On 8 December, the Group signed an agreement for the take-over of the Vosges plant by
Modulex, a Canadian specialist in wood-frame houses. The Group contributed financially
to creating 500 jobs by Modulex, of which at least 200 would be reserved for Groupe SEB staff.
Plant installation and the necessary staff re-training will continue until October 2007.
affected staff
Almost two-thirds of the 212 employees at Fresnay benefited from age-related solutions, while
the others were transferred to the Alençon and Mayenne plants. The Group continued its efforts
to have this site re-industrialized and several projects were under study at the end of 2006.
The total cost of the measures taken by the Group under its industrial reorganization plan
was €70 million at the end of 2006.
Design unit_ Saint-Jean de Bournay – France
Assembly line_ Pont-Évêque – France
A NEW CAREER CHOICE
* Poivrières Salières Peugeot.
“I was a forklift operator at the Groupe SEB Vernon factory in 2005. I had felt for some time that I would like
to do a job helping people in the medical field or in social work. After a training stint in a retirement home,
I decided to become a healthcare assistant. I talked about my plans with the personnel department at
the factory. At that time, there was still no question of restructuring or redundancy, so I was surprised to find
them so attentive and supportive. They readily agreed to help me despite the inconvenience of periods of
absence from work. During my thirteen months of training, I remained an employee of the Group and continued
to be paid, first under continuing education arrangements and then under an employment protection plan.
CHRISTOPHE MAUGUIN,
Healthcare assistant,
Vernon hospital.
After obtaining my diploma in 2006, I was employed by the Vernon central hospital. I am very happy in this new
job because it has a strong human relations content and gives meaning to my life”.
55
A global approach to human resources
Almost half of all Groupe SEB employees today are outside France, and this will soon be above
50% with our expanding international operations.
To guarantee fair treatment of all employees, the Group uses standard human resources
management procedures worldwide (collective bargaining agreements*, annual evaluation
interviews, job descriptions, career planning, remuneration, etc). These procedures currently
cover 1,700 of the Group’s managers and supervisors, and it is planned to extend them further.
They are detailed in a document given to all managers which can be consulted on the Group’s
Intranet. More than 90% of managers worldwide benefited from an evaluation interview during
2006.
Annual human resources reviews make it possible for the Group to anticipate its organizational
needs, identify key posts and make replacement plans which take account of the career
development wishes of the individuals concerned. These reviews are organized within each of
the Group’s Strategic Business Areas, Continental Structures and Corporate Functions. In 2006,
two new reviews were introduced in the areas of research and development and marketing
strategy.
* Collective bargaining agreements in 2006: 30 in France and 47 internationally.
Management practices in keeping with the Group’s corporate values
The Group also encourages participative management practices which lay emphasis on leading
and motivating working teams for better performance. Hence the Fair Process initiative which is
Training_Groupe SEB Academy
based on guidelines that serve as a management reference framework in line with the Group’s
corporate values. Managers can opt for a so-called 180° anonymous evaluation of their
management practices by the members of their working team, leading to subsequent dialogue
and identification of areas for improvement. Fair Process is discussed during the annual
evaluation interview and is an integral part of all management training programmes
Training at every level
Training is another important lever used by the Group to develop a shared management culture.
2.27
2.02 2.00
In 2006, the Group’s international management programme, called ‘Leaders’, involved more than
170 individuals of 17 nationalities. In addition to general management practices, it covered
strategic skills such as finance, logistics or marketing. This training offers opportunities
for exchange and sharing of experience and helps to create a world management community
within the Group.
Training is also provided for all Group employees. Most of this training is organized locally
to meet the specific needs of each subsidiary, within a framework of training priorities defined
56
at Group level. Priorities for 2006 included upskilling and enhancing employability in each job
category.
The recent implementation of a Group-wide human resources information system is helping
to ensure better follow-up of training around the world.
2006 2005 2004
TRAINING BUDGET
as % of total payroll
Training_ Arno – Brazil
Training_Millville - USA
Information, communication, exchange
The Group has developed a wide range of media to keep its employees up to date on company
news, working teams and products. The in-house press includes the Tempo magazine, mainly
for managers, and some 20 local bulletins forming part of a coordinated system that recently
welcomed two new sites in China and Brazil. These bulletins offer local news and information on
Group strategy. Daily news postings are also featured on the Group’s in-house Intracom network.
‘Careers and jobs’, offers employees a whole range of services including permanent access to
job vacancies within the Group. Staff can submit applications online, or e-mail a CV to the human
resources team. A similar system also exists for external job applicants (www.groupesebcareers.com).
Training_ Arno – Brazil
Still in the area of communications, a management convention was held in Lyon in May 2006
for the Group’s 180 senior managers. The event made it possible to review progress since
the last convention in 2002, and focused attention on key challenges for the future of the Group.
Attending managers were given a communications kit to help them pass this information
on to their own working teams.
The Intracom system is a mine of information, as well as being a work tool for employees and
a forum for exchange. Its use is growing constantly (+15% in 2006). One of the latest themes,
57
In-house magazine
_ Tempo
Health and Safety: a Groupe SEB priority
Industrial accident prevention is another Groupe SEB priority. Each month health and safety
returns for all the Group’s French plants are widely circulated and discussed. For factories
outside France, this is done every three months. Each plant also draws up its own safety targets.
The Group’s main area of health concern is repetitive strain injury. Special measures have been
applied for some years at the French plants where the problem is made more acute by an ageing
workforce and longer working lives. In 2006, the Group’s prevention efforts led to a drop of some
20% in the frequency of accidents with absence from work, as well as in gravity of accidents.
Examples of good practice
The Group took new initiatives to combat repetitive strain injury during 2006. At the Pont-Evêque
plant, for example, the improved design of new steam-generating systems simplifies their
assembly, reducing the number of repetitive movements which could cause muscular strain
injury. In another example, at Is-sur-Tille, two new electric fryers have been designed to
integrate ergonomic criteria. The Group’s factories also make widespread use of ergonomic
notices detailing, for example, the physical constraints of workstations.
Two-handed machine_Arno – Brazil
Design unit_Pont-Évêque – France
Production line_SSEAC – Shanghai
A METHODICAL APPROACH
“The Is-sur-Tille factory has for several years used a methodical approach to reducing accidents and industrial
illness. Rotation of operatives between different tasks on a production line is one of the recent steps introduced
to combat repetitive strain injury. Apart from varying the physical movements involved, switching tasks every
two hours reduces fatigue, gives added interest to the work and encourages multiple skills. We applied this new
system gradually to avoid concerns among working teams about their ability to adapt and achieve production
targets. In 2006, task rotation was applied throughout the factory with no loss of productivity. In the area of work
safety, our approach is mainly to identify ‘danger spots’ at the beginning of the year; these are then
HUGUES OGER,
Industrial Manager,
Electric cooking
appliances,
Is-sur-Tille
(up to September 2006).
programmed for corrective measures, with a monthly follow-up. This action plan is integrated into the factory’s
bonus system criteria.”
Diversity: from words to deeds
27.2
25.4
Convinced that diversity is a source of creativity and dynamism, Groupe SEB adopts an
23.5
affirmative approach in this area. In 2005, it signed the Diversity Charter in France, undertaking
to combat all forms of discrimination and to encourage the integration of visible minorities.
This stance on diversity is included in our Human Resources guidelines. In 2006, the Group
regularly drew attention to this principle in notes issued to managers, on the in-house Intranet
and in a Sustainable Development brochure. In France, a special training module was designed
for human resources teams, and more sessions are planned for 2007. The Group also drew
up an action plan and established a Diversity Committee comprising staff representatives.
This committee met on four occasions in 2006. The principle of diversity also applies to balanced
representation of men and women in management. The Group has progressed in this area on
2006 2005 2004
WOMEN IN MANAGEMENT
as percentage of total management
an international scale: the proportion of female managers last year stood at 27.2%, up from
20.1% in 2002.
Taking account of disability
Groupe SEB personnel worldwide includes 4.8% of people with disabilities. To facilitate their
integration, the Group assigns them jobs compatible with their handicap and, in some cases,
adapts the workstation to their needs. In Brazil, Arno employs ten people who are deaf-mute.
To aid communication with them, Arno introduced a training course in sign language.
The training has already been taken up by 25 people. Following this success, Arno plans
Sign-language training_ Arno – Brazil
DIVERSITY COMMITTEE
Christian Coutin, Vice-President of Sustainable
Development and staff representatives (trade
unions) : Brahim Bedreddine (CGT), Yannick David
(FO), Thierry Décarre (CFDT), Daniel Fauvel (CFTC)
and Jacques Imbeaud (CFE-CGC).
to continue the programme in 2007.
A REAL DETERMINATION TO GET THINGS MOVING
“When we were invited to join a Diversity Committee early in 2006, we were sceptical at first, wondering if we might not be used
merely in a symbolic sense, just to rubber-stamp decisions already made. Finally, we agreed to take part in this dialogue and
make our suggestions on diversity, a subject of interest to us. We thought we would decide after some time whether or not to
remain on the committee. A year later, we are still participating because we have seen that there is a real determination on
the part of Groupe SEB to get things moving. It is a committee where dialogue is open-ended, and some of our proposals have been
taken on board: for example, the development of apprenticeships with a tutorial support system to encourage the integration
of young people from sensitive areas. The training and awareness programmes for human resources teams are also a step
in the right direction. Other projects are planned for 2007, and we will watch their progress with interest.”
59
60
15,300 shareholders,
2,500 suppliers worldwide.
Acting for tomorrow
means
GROWING
Our ultimate aim is to satisfy consumers
by offering them innovative and highperformance products which also respect
the individual and the environment.
To achieve this goal, we work in close
liaison with our suppliers and distributors.
Similarly, our relations with our
shareholders – vital partners in our longterm enterprise – are conducted in a spirit
of mutual confidence and transparency.
INTEGRATING THE CONCERNS OF CIVIL SOCIETY
WITH OUR PARTNERS
In its relations with its economic partners – consumers, suppliers, distributors
and shareholders – Groupe SEB bears in mind the growing concern of civil society about
safeguarding the environment and social questions. The Group’s suppliers are required to sign
specific undertakings in these areas. Consumers and distributors are also increasingly sensitive
to these issues, and the Group takes this into account in its product offer. Meanwhile, civil society
demands greater transparency and good corporate governance, which also coincides with
the interests of every shareholder. Another overriding criterion in the Group’s decision-making
is the globalization of trade, which is transforming the nature of competition. This is leading
the Group, for example, to increase its purchasing from low-cost countries, including a growing
share of finished products.
61
CONSUMERS: AIMING FOR SATISFACTION
Increasingly attentive
National customer service centres, the details of which are shown on our product packaging,
are a key channel of consumer information and feed-back. They handle questions and claims
relating to products. This service is highly developed in France, where it is staffed by 17 Welcome
Centre customer advisors. In 2006, they responded to 200,000 contacts from consumers
by telephone, e-mail or post. New IT systems being currently installed are designed to improve
the already excellent quality of this service (92% of calls are answered within 15 seconds).
The new system will handle e-mail queries and SMS messages, and will indicate the
whereabouts of the nearest approved service centre. The Group plans to reorganize customer
service centres throughout Europe to bring them up to the level of service in France.
Casa Gourmet course
_ Arno – Brazil
QUALITY, A MATTER OF STRATEGY
“Satisfying the consumer with quality products is the prime objective of Groupe SEB. Our performance
indicators have shown steady improvement in the quality of our products for several years, though the trend
levelled off in 2006. There were two reasons for this: first, a higher-than-average return rate for certain
beverage appliances in which the Group is now resuming control; second, difficulties in obtaining certain spare
parts from Chinese suppliers, which obliged us to replace products rather than repair them. Corrective action
has been taken. The Group has now decided that all top-range or technically innovative products will be
RÉMI DESCOSSE ,
Groupe SEB,
Executive Vice-President
– Industry.
subjected to consumer testing during the three months prior to the planned date of release, so that any
necessary adjustments can be made. Emphasis will also be placed on greater availability of spare parts. Aware
of the vital importance of quality, we have set up a multi-disciplinary working group which will report to the
Group Executive Committee during 2007 with proposals on reinforcing the quality control process.”
62
Product demonstration – Saudi Arabia
Product demonstration – France
QUALITY PERFORMANCE
2006 index
2005 index
2004 index
Cost of obtaining quality (COQ)*
101
91
100
Rate of returns in France
124
99
100
Supplier quality **
104
93
100
88
85
100
Customer complaints outstanding
* On the basis of IFR accounting standards.
** Rate of returns – the lower the figure, the better the quality of service.
The cost of obtaining quality (COQ) is an indicator which monitors product quality performance. It includes the costs
of prevention, detection and correction of faults in products at factory level, as well as costs relating to product
returns from clients and repairs.
Improving after-sales service
Another task undertaken by Groupe SEB in 2006 was the complete overhaul of its after-sales
service. The aim was to improve customer satisfaction in the cost and quality of repairs and
the time taken to do them. Launched initially in France, this exercise will be extended to
international markets.
Innovating for healthy eating
Responding to consumer needs also means designing products for healthy eating that conserve
both the pleasure of cooking and the pleasure of tasty dishes. Ever since the invention of the first
development is its Nutrition Gourmande range launched in 2006. The range includes a steam
cooker, an oven which combines standard convection and steam cooking, and an electric fryer
that can cook a kilo of tasty chips with just a single spoon of oil (and a little help from
the steam-cooking feature).
KNOWING HOW TO COOK AND STAY HEALTHY
Is there a relationship between heart disease and today’s eating habits?
Heart disease is the leading cause of mortality in France, accounting for 180,000 deaths each year. Apart from
the effects of smoking, stress, lack of exercise and hereditary factors, the risk of heart disease is due also
to over-eating or unhealthy diet. It is urgent that we return to normal, well-balanced meals, eaten in proper
pressure cooker, Groupe SEB has been regularly innovating in this area. Its most recent
conditions.
Are eating pleasure, rapid preparation and balanced diet compatible?
PROFESSOR CHRISTIAN
CABROL,
Member of the French
Académie Nationale de
Médecine,
Chirurgien honoraire des
hôpitaux de Paris,
President of ADICARE
(Association for research
and innovation in
cardiology).
A balanced diet will not last long without the pleasure of eating. True, modern lifestyles impose growing
constraints on time. The challenge today is to design cooking equipment that makes it possible to combine
balanced diet, eating pleasure and practicality.
What do you think of Groupe SEB’s Nutrition Gourmande range?
These new ways of cooking which preserve the taste and nutritional value of food, while remaining easy,
are of great interest in the context of preventing heart disease. More generally, they can help to rediscover
the virtues of a traditional daily diet of well-balanced dishes prepared from fresh products, of which we are
all in urgent need today.
As Dr Recchia and I have been underlining in our illness prevention programmes for the last twenty years,
knowing how to cook properly is also knowing how to stay healthy – which goes to show how important
it is to have a broad vision of illness prevention.
63
SUPPLIERS: CLEAR-CUT RULES
Close links with our supplier panel
Groupe SEB factories used 2,535 suppliers worldwide last year (against 2,060 in 2005) for
purchases of materials, spare parts and sub-assemblies. This increase is due to recent
acquisitions, but the Group plans to gradually cut the number of suppliers with a view to greater
efficiency. Of these purchases, 52% came from countries with highly competitive conditions.
Meanwhile, 85% of purchases by our European factories are made from 368 suppliers who are
considered particularly reliable and solid. The Group has included these suppliers on its
approved panel and maintains close working relations with them, by means of regular
performance reviews and a dedicated extranet which gives details of the Group’s purchasing
policy and conditions, as well as access to various sets of guidelines.
Compudar_Brazil
We are also making more use of sourced finished products, mainly from Asia. In 2006, these
products accounted for almost one-third of Groupe SEB sales. The Group has created an Asia
Sourcing Department, based in Hong Kong, to ensure greater supervision of the manufacture
of sourced products.
Purchasing and sustainable development
The Group makes demands on its suppliers in terms of quality, prices and on-time delivery.
Our suppliers are also required to respect the Group’s commitment to sustainable development,
in particular on the environment and working conditions. Sustainable development principles
are integrated into the Group’s Purchasing Guidelines, and a paragraph on this question
is included in our general purchasing terms and conditions.
Compudar_Brazil
Crastal_China
BETTER CONTROL OF PRODUCT SOURCING
“Sourcing accounts for a growing share of Groupe SEB purchases today: up 30% in 2006 – mainly from Asia
(China in particular) – and covers some 100 suppliers. In time, we would like to cut this figure to about 50,
so that we can follow them up more closely in terms of performance, cost, quality and delivery deadlines,
as well as on respect for labour laws and the environment. Groupe SEB decides on the design and specifications
for each product, after which the supplier undertakes the development process prior to manufacturing.
Since 2006, each supplier has a single contact within our new Sourcing Department. This contact is responsible
for about ten suppliers, and uses a team of project leaders who spend most of their time visiting suppliers
LAURENT RUHLMANN,
Manager of Asia
Sourcing,
Groupe SEB Asia,
Hong Kong.
to oversee the development and manufacture of the products on a day-to-day basis. This follow-up structure
involves more than 100 staff.”
A panel
368
of
suppliers
of which 24%
in Asia.
Environment: 20% of our supplier panel certified ISO 14001
Since 2004, the Group has required its suppliers to sign an eco-statement in which they
undertake not to use hazardous substances forbidden by various regulations, notably
the European RoHS Directive which came into force in July 2006. At the end of the year,
all suppliers without exception met this requirement and the Group carried out more than
130 component tests. In a few exceptional cases where the analysis was borderline, the Group
invited the supplier to submit another proposal for the make-up of the product.
At the end of 2005, an environment questionnaire was sent out to the supplier panel to make
an initial evaluation of their performance in this area. Already, 20% of them hold ISO 14001
certification, and another 25% plan to obtain the certificate in the next three years.
Labour rights: some 30 follow-up inspections
Groupe SEB is also concerned to ensure that its suppliers comply with local labour regulations.
In view of the growing number of Asian purchases, including finished products, the Group drew
up a labour rights statement based on the SA 8000 international standard. In 2006,
this statement was signed and returned by 100% of suppliers. The Group carried out 31 detailed
follow-up inspections to verify the accuracy of these statements. Eleven of the studies were
confided to outside experts and 20 were conducted by the Group’s own internal control staff.
Adiamas_Mexico
Points examined during these on-the-spot investigations, which last a minimum of two days,
include child labour, forced labour, health and safety, freedom of association and working hours.
suspends new invitations to tender and imposes a monitored programme of corrective
measures. Resumption of working relations is conditional on final compliance.
Out of the 31 inspections done in 2006, only one case of this type was found. The defaults in
this case included hourly pay-rates below the legal minimum, and non-payment of overtime.
Simatelex_China
25 YEARS OF COLLABORATION
If a supplier is found to be not conforming with local labour regulations, the Group immediately
“Simatelex, a manufacturer of small domestic equipment, is headquartered in Hong Kong and has five
production plants in southeast China. We employ 15,000 people and make 20 million articles a year. For more
than 25 years we have supplied Groupe SEB with mainly personal-care appliances such as hair dryers and
some toaster models. Our business with the Group has doubled in the last five years. Based on design and
technical specifications supplied by Groupe SEB, our engineering and quality-control teams undertake the
development, testing and qualification of the products – with each stage closely monitored and validated by
Groupe SEB.
The products are then manufactured in one of our plants. Groupe SEB is demanding in terms of competitive
ESTHER SUEN,
General Manager
of Simatelex,
Groupe SEB supplier
based in Hong Kong.
costs and quality, and it is very concerned with matters affecting the environment and working conditions.
The Group carries out inspections in these areas, as it last did in November 2006. We have regular meetings
with Groupe SEB representatives to bring our collaboration up to date, and I think we work well together as
a team: for example, we use some of Groupe SEB’s tools and methods in production planning and performance
assessment”.
65
RETAILING: SERVICE TO THE FORE
Orders delivered in time, and on time
Retailers, who bring Groupe SEB products to the consumer, demand high standards of service.
We measure our service performance rate as the percentage of orders sent out on schedule
from our warehouses to distributor depots. The Group aims at a service rate of 95% in France.
In 2006, this was maintained at about 90%, which is acceptable in view of the complexity
of delivery schedules for the growing volume of products arriving from Asia. The service rate
is higher (96%) for retail clients who have opted to use our Joint Supply Management (JSM)
system. With JSM, Groupe SEB manages stock replenishment for distributor warehouses,
ensuring maximum availability of products and minimum stock levels. A new client opted for
this system in Spain in 2006.
More and more distributors are also adopting Electronic Data Interchange (EDI) to simplify,
accelerate and cut the costs of transactions with the Group. In 2006, the use of EDI saw
a marked increase in Japan, Korea and the countries of east Europe.
SEB store_Algiers
Simplified relations, more efficient logistics
In France, since the creation of a single commercial entity in 2005 for all the Group’s products,
each major retail banner deals with just two Groupe SEB contacts: one for domestic electrical
appliances, and one for cookware. As a result, client relations are simplified and service is more
personal. Last year also saw a reorganization of logistics in France, with the creation of two
multi-brand warehouses: one for electrical appliances in Orléans, and one for cookware in
Rumilly. This centralization has simplified logistics flows and made for better client service with,
for example, fewer truckloads to handle and reduced sales administration. It has also generated
Group savings of about 10% in shipping costs, and reduced the impact of transport on the
environment.
66
Sales outlet_Saudi Arabia
Tefal shop_Turkey
Casa Lagostina_France
SHAREHOLDERS: CONFIDENT AND TRANSPARENT RELATIONS
Regular information
To keep its shareholders regularly informed on the company’s progress, Groupe SEB places
at their disposal a wide array of information tools.
The different versions of the annual report (the Reference Document submitted to the French
Financial Markets Authority, the complete Corporate Report or the summary Report) form the
mainstay of the company’s communications. This is completed by the half-year report (in digital
form since 2006), the Letter to Shareholders which gives a regular update on the Group’s
activities (four issues in 2006), the Shareholder Guide and the AGM Notification.
There are also regular financial press announcements. All these documents are available
on request from the Groupe SEB Financial Communications Department, and can be downloaded
from our corporate and financial website (www.groupeseb.com). Our website was completely
Annual and Sustainable
Development Report_2005
revamped early in 2006. Today, it offers access by profile (shareholder, financial analyst, investor,
journalist, job applicant, or supplier), guiding each user to the right information. A very
important and comprehensive communications tool, the Group’s website gives a fully detailed
presentation of the Group’s operations, strategy, capital structure, trading results and
stockmarket information.
Opportunities to meet
occasions to meet throughout the year. Apart from the main annual event which is the AGM,
the Group participates in meetings with shareholders organized by leading financial media
in different French cities: in 2006, through meetings in Marseille, Versailles, Montpellier
and Annecy, it was able to meet some 750 shareholders.
Factory visits are planned for 2007 to help shareholders to learn more about the work of
Letter to Shareholders_
November 2006
the Group in its industrial context. The Group also meets its shareholders at the Actionaria
stockmarket fair held in Paris in November. The 2006 Fair was particularly rich in exchanges
with the many visitors who visited the Groupe SEB stand.
The Group also maintains and develops close links with financial analysts throughout the year
(some 20 of these being regular participants) to ensure that they have the information they need
to form their opinions and make recommendations on the SEB share. The Group also meets
directly with investment portfolio managers (over 300 contacts in 2006), establishing useful
The Group also places a high value on direct dialogue with its shareholders, through the many
exchange to better understand their expectations and give relevant answers to their questions.
67
More than
1,300 contacts
with shareholders.
Annual General Meeting_ May 2006
Actionaria Fair_ November 2006
A balanced shareholder base
In pursuit of its long-term strategy, Groupe SEB can count on a well-balanced shareholder base
comprising the family founder group, employees, French and foreign institutional investors
and individual shareholders. The stability of this structure is a source of support for the Group’s
management over the long term. Despite efforts to increase the number of individual
shareholders, their proportion has fallen in the last two years. It can be assumed that
the reduction in 2006 was linked to profit-taking after the rise in the value of the share during
the year. The Group will nonetheless continue its efforts in 2005 to increase the number
of individual shareholders, whom it considers important as long-term partners.
Dedicated services
All individual shareholders – both nominal and bearer-share owners – are welcome to contact
the Shareholder Relations Department with questions or requests for information. The SEB
Factory visit_ Rumilly - France
Share Service which manages the nominal share register, handles share purchase and sale
orders free of charge. It also handles dividend payments, AGM notification, supply of tax forms,
or share inheritance and donation transactions. Nominal shareholders can use the Internet to
obtain direct real-time access to their account, follow up current transactions or consult a
record of their positions and previous transactions.
A GROUP THAT KNOWS HOW TO QUESTION ITSELF
“We entered the capital of Groupe SEB in 2003 after its takeover of Moulinex. Our interest in the Group has
grown steadily thanks to frequent exchanges with its management team, and in particular with Mr de La Tour
d'Artaise. Groupe SEB has understood the need to question itself when faced with a difficult market context.
68
It has a clear strategic aim to strengthen its leadership and give itself the means to do this – as illustrated by
its current industrial restructuring plan. The fact that the company is controlled by the family founder group is,
as far as I am concerned, neither an advantage nor a drawback. What is important is the competence of its
management team and their ability to generate growth. From this point of view, we are confident in the way
DIDIER LE MENESTREL,
Chairman of Financière
de l’Echiquier, an
independent
portfolio management
company, and Groupe SEB
shareholder.
the Group is being run, and we are now waiting to see the results of these measures reflected in the figures.
Our main criterion is net return on capital employed (after tax): today, this is under 10%, but we look to a range
of 12% to 15% as from 2008. We are also very attentive to the Group’s efforts in innovation and creativity in
the conception of its products”.
Dividend
Groupe SEB policy on the question of remuneration of its shareholders has been steadily
maintained, and continues to be based on a long-term approach: a fair dividend increase when
trading results permit, and holding it level when circumstances oblige. After four years of rising
dividends, the Board of Directors stabilized the dividend at €2.40 per share in 2006 (paid in
respect of 2005) due notably to restructuring in France. In 2007, in view of the optimistic outlook
– a return to organic growth, promising international plans, improvement in the operating
margin – the Board of Directors will propose to the Annual General Meeting a dividend of €2.55,
being an increase of 6.25%.
We would point out that the Group also pays a dividend supplement equal to 10% of the dividend
for all shares in the nominal register and held in this form for two consecutive years.
CHANGE IN NET DIVIDEND
In euros
2005
2.40
2004
2.40
Special offers on products
As our shareholders are also consumers, the Group offers them special purchasing conditions
for its products. Nominal shareholders in France receive a mail-order catalogue through
which they can buy 20 SEB products a year at reduced prices. Bearer-share owners benefit
twice-a-year from an offer to buy up to four products from a selection of some 30 products.
2.55
2006
69
Mail-order catalogue_2006
70
3
Corporate sponsorship:
priorities
support for social integration,
help with return to employment,
access to education.
Acting for tomorrow
means
PROMOTING
Social solidarity has long been a strong
corporate value for Groupe SEB.
So, it is easy to see why we have chosen
to concentrate our corporate sponsorship
on the combat against social exclusion,
a major concern of civil society in many
countries. More than ever today, we see
our social responsibility as of prime
importance.
OUR CORPORATE VALUES
CORPORATE SPONSORSHIP
A central theme: the combat against social exclusion
Groupe SEB has for several years placed the combat against social exclusion at the centre of
its corporate sponsorship priorities. It decided to better structure and support its efforts in
this domain over time by creating a Groupe SEB Foundation in 2007. This non-profit structure
will coordinate all the Group’s present and future corporate sponsorship projects, on three main
themes: return to employment, social integration via improved living conditions, and access
to education and training.
71
Habitat et Humanisme_Lyon – France
Envie shop_ France
Giving people a second chance
In the employment aid field in France, Groupe SEB works with the Second Chance Foundation
which gives a helping hand to people in difficulty who are motivated to get off to a new start in
employment. The Foundation can help them to create a small business or take up re-training.
Groupe SEB helps to run two of the Foundation’s branches in Lyon and Annecy. Groupe SEB
volunteer employees provide support for sponsored individuals in carrying out their project.
The Group is also a shareholder in the France Active investment company, which puts up
priming funds for social integration enterprises. Still in the area of economic solidarity, the
Group supports the Envie network which helps people back into the world of work through the
repair of household equipment. The Group provides products for repair. In 2006, it contributed
to an increase in the capital of the Envie Rhône association. Similarly, as an active member
of Entreprendre en Rhône-Alpes, which helps people to set up their own business, Groupe SEB
promotes recruitment of people in difficulty by these newly-created companies.
‘A NEW LEASE OF LIFE’
“I bought this picture-framing shop in Mâcon with the help of the Second Chance Foundation and the support
of the manager of the Lyon branch run by Groupe SEB. In just three years, my life has completely changed.
In 2003, I was unemployed and lived in a caravan beside a barn which I was renovating, bit by bit, with my
companion. Then, I found a part-time job in this picture-framing shop – a job I just love. Eighteen months later,
my boss offered me the chance to buy the business, and I was all for it. But the bank would not give me a loan
without a personal injection of funds. So, I approached the Second Chance Foundation. In less than three
months, the deal was clinched. Once the Foundation and the County Council agreed to give me aid, the bank
ANGÈLE GARCIA,
sponsored by
the Second Chance
Foundation – Mâcon.
agreed to loan me the rest. On top of that, one of the Association’s Groupe SEB volunteers regularly monitors
my project and gives me advice when needed. The Foundation helped with more than just the shop: it helped me
to keep my job, which meant we could go on renovating the barn. Today, we have moved out of the caravan,
which has given us a new lease of life!”
72
A roof over one’s head
An essential precondition for social integration is having a roof over one’s head. Facilitating
access to housing for those who are deprived or at risk of losing their self-reliance is a core
concern of Habitat & Humanisme, a French association based in Lyon, with which Groupe SEB
has formed regular working links. The association helps people in difficulty to find decent
housing and supports their re-integration via, for instance, social activities in shared areas
where they can meet people from other horizons.
‘No to waste’
500,000 Brazilian
children made
more aware since 2003.
Habitat et Humanisme - Fête des Lumières_
Lyon – December 2006
Groupe SEB helps the association not only with products to equip living quarters and shared
facilities, but also with the active participation of Group employee volunteers in monthly
community events such as cookery workshops. This partnership will be gradually extended
beyond the Lyon area to other French regions where the Group operates.
Education also helps to integrate
Education and training are important levers that help to integrate people from deprived
communities. Brazilian subsidiary Arno is a pioneer in this field, with the energetic involvement
of more than 70 employee volunteers. In 2006, it helped on a FUMEC University project in Belo
Horizonte in Brazil’s state of Minas Gerais. This project offers courses in cookery and beauty care
equipment from one of its local Casa Gourmet centres. Arno’s Casa Gourmet showrooms are
customer welcome centres through which it promotes the Group’s products and offers product
Habitat et Humanisme_
Lyon - France
demonstrations and courses. The Belo Horizonte project resulted in the training of some
100 young people in gastronomy and personal care. Arno also continued its programme
of teaching children to prepare fruit and vegetables without waste, with backing from São Paulo
state: 200,000 children benefited from this programme in 2006.
in the context of training for qualification and social integration. Arno helps with trainers and
73
Casa Gourmet_ Brazil
Community projects – Schools_ Brazil
Community projects – Schools_ Brazil
CIVIC INVOLVEMENT
Helping to think about solutions
Groupe SEB participates in several think tanks and exchange forums which inform its civic
commitment programme. In the autumn of 2006, for example, the Group was a participating
partner in the first Responsible Globalization Forum held in Lyon, to explore alternative
approaches to development. It is also a member of IMS (Institut du Mécénat et de la Solidarité),
an association which supports business enterprises in carrying out their corporate social
responsibility. To mark its 20th anniversary in 2006, IMS organized a one-day forum on
the theme: ‘How companies can better contribute to cohesion and social equity, in the context
of changes in civil society’. Groupe SEB took part in this debate.
Multiple local initiatives
Adeph
Equation
Tejido Humano
Handicap Zero
…
All around the world, Groupe SEB is involved in the life of the regions where it operates. Group
entities organize open days and take part in events arranged by business partners, educational
institutions and associations. They also encourage links with schools through, for example, visits
for pupils and training courses. Many Groupe SEB companies support community and
educational projects with donations of products, financial aid, and often via voluntary work
by Group employees who are given time off to do this. One example of the many projects in 2006
was the financial aid given by Groupe SEB Colombia to the Tejido Humano association which
helps victims of armed conflict in certain areas of the country.
Local employment
Groupe SEB is very aware of its role in the economic life of the areas where it operates.
When the need to remain competitive leads it to close a factory, it seeks solutions for every
affected employee and does everything possible to limit the impact on local economic life.
In 2006, it allocated substantial resources in France to re-vitalize the Vosges, Dampierre and
Fresnay sites, and to create new jobs at the Selongey-Gare site where logistics functions ceased
in 2005. While all the affected staff were re-employed, the logistics platform buildings remained
unused. As a result of the Group’s efforts, in liaison with local labour unions, an enterprise zone
is now being created on this site.
74
Arno community project
_ Brazil
Seb publicity vehicle_ 1955
150 years of history and shared values
Groupe SEB celebrates its 150th anniversary in 2007. This century-and-a-half of history takes
tangible form in a depository of cultural heritage centred around the world of small domestic
equipment, with the corporate values of Groupe SEB as a constant background theme.
This rich legacy is today assembled, preserved and enhanced thanks to the SEB Historical
400,000 photos, 2,500 films, and documentary records occupying 260 metres of shelf space.
The collection is available for consultation by the Group's employees and outside partners.
In 2006, it was used as a basis for several works, and parts of the collection have been loaned
to galleries for exhibition. It was also used to prepare a TV programme by the Franco-German
television channel, Arte, on the theme, ‘La petite histoire du fer à repasser’ (A short history
of the iron).
Archives Unit. Created in 2004, it assembles a collection of more than 8,000 products,
75
Calor publicity vehicle_ 1967
Moulinex poster_ 1960
150 years ago,
our world is your world.
Since
76
74%
Over
of industrial waste
recycled in 2006.
Acting for tomorrow
means advancing while
PROTECTING
We are deeply concerned by the world’s
ecological problems: depletion of natural
resources, the greenhouse effect,
accumulating waste and the threat
to biodiversity. Which is why, at every
stage in the life-cycle of our products,
we are taking action to limit
the consumption of natural resources
and energy, and to help reduce pollution.
ECO-PRODUCTION:
FACTORIES RESPECTING THE ENVIRONMENT
Over 80% of our factories are certified ISO 14001
Groupe SEB has been striving for many years to improve the environmental performance
of its factories. Our introduction of a worldwide management environment system in 2003 led
to gradual certification of our factories under the ISO 14001 international standard. Last year,
another eight Group factories were certified (in France, Germany, Brazil, United States
and Mexico). Today, 81% of the Group’s international plants and 90% of its French plants are
certified ISO 14001.
The system for collecting environmental performance data from these factories, which began in
2004 and was applied worldwide in 2005, was adjusted last year to make performance indicators
more accurate.
THE ENVIRONMENT
77
Limiting the consumption of water and energy
Consumption of water and energy per finished product is still being brought down in absolute
terms for the French sites (see chart below): These good results, which are reflected on a world
scale, show the commitment of our factories to safeguarding the environment. Their efforts last
year included the introduction of more resource-efficient installations, greater vigilance and
better management of the use of natural resources.
In Lourdes, for example, following a diagnostic study of energy use in 2005, employees were
made more aware of the need to switch off machinery when not in use, and some roofs were
modified to admit natural light.
• Total use of gas in kWh per finished product
• Total use of electricity in kWh per finished product
• Total use of water in thousands of litres per finished product
USE OF GAS / ELECTRICITY / WATER (FRENCH SITES)
2006
1.90
1.77
11.94
1.97
2005
1.78
12.84
2004
2.14
1.95
14.94
Less waste and emissions
Waste generated by the Group’s factories is mostly ordinary industrial waste such as packaging
and rejects. An increasing proportion of this waste is sorted and recovered: the recovery rate
continued to improve in 2006, reaching 74% worldwide, against 70% in 2005. In France, the rate
is 75%. All special industrial waste is handled by approved recycling operators. Industrial
wastewater is recovered and processed by wastewater treatment facilities. Carbon dioxide
emissions into the atmosphere, although quite modest due to the predominance of assembly
78
work, continued to fall by an average of 4% per finished product between 2005 and 2006.
The Group also continues to reduce the use of solvents in degreasing operations to limit
emissions of volatile organic compounds. Following the Tournus plant in 2005, Rumilly converted
a degreasing tunnel in 2006 to replace solvents by water-dissolved detergents which have less
of an impact on the environment.
Between 2005 and 2006, the Cajica plant
in Colombia cut its water use by 24% and
reduced gas consumption by 3.5 times,
while increasing production by 10%.
The plant holds ISO 14001 certification.
ECO-DESIGN:
INTEGRATING THE FULL PRODUCT LIFE-CYCLE
Easier to recycle...
How to use less raw materials in manufacturing a product... How to cut down on energy
consumption... How to make it easier to recycle a product at the end of its useful life... Groupe
SEB development teams take these questions into account at the drawing-board stage of every
product. This eco-design process is defined in guidelines used in all the Group’s design units.
The use of lighter, recoverable materials and fewer different materials make it easier to recycle
a product at the end of its useful life. In 2006, the Group held to its target of 70% recyclability for
new products. It also implemented the European Directive on limiting the use of hazardous
substances (RoHS) on 1 July 2006. The Group had anticipated this Directive for some
components since 2003, with a more comprehensive list of hazardous substances which it
banned in its products. This list applies to all the Group’s own factories and to all its suppliers
who are required to sign an eco-statement.
…and more energy-efficient
A large part of the environmental impact of small electrical appliances relates to their power
Launched in France in 2006,
the Shock Absorber vacuum
cleaner won the Entreprises
et Environnement 2006
title, awarded by the French
Ministry for Ecology
and Sustainable Development.
fountain launched by Tefal in 2006 is an example of an energy-efficient product: it heats only the
amount of water to be used, and to a lower temperature than a classic electric kettle, which
is ideal for certain hot drinks. Groupe SEB decided to limit average stand-by power consumption
of its products to 3 W (target reached in 2006) and aims to bring this down to 1 W by 2010.
The Quick & Hot, for example, uses only 1.5 W on stand-by.
ECO-DESIGN AND CUSTOMER BENEFITS
“What are the environmental benefits of the Shock Absorber vacuum cleaner? It is twice as light as a classic
vacuum cleaner (thanks to the first-time use of expanded polypropylene for this type of product), its innovative
motor uses 20% less power for equal performance, and all the plastic body parts are in polypropylene, which
makes it easier to recycle. We adopted an eco-design approach to this product at the outset, with the backing of
the French Environment and Energy Management Agency and ENSAM* in Chambéry. Analysis of the life-cycle
of this product shows a reduced environmental impact of 10% to 50% (depending on the criteria used)
ROBERT MEYRIGNAC,
R&D Manager,
Rowenta – Vernon.
compared with an equivalent standard vacuum cleaner. This ecological approach also led us to develop user
benefits such as cushioning impacts with walls and furniture thanks to the pliability of expanded polypropylene.
Another fine example of eco-design as a lever for innovation”.
*ENSAM: Ecole Nationale Supérieure d’Arts et Métiers.
consumption during use and on stand-by (clock, programmer, ‘on’-light). Groupe SEB makes
great efforts to reduce the power consumption of its products. The Quick & Hot hot-water
79
RECYCLING END-OF-USE PRODUCTS
Europe: creation of eco-organizations
Point d
ollec
ec
te
In application of the European Directive on the elimination of waste electrical and electronic
equipment (WEEE), every EU country is required to collect and recycle these appliances when
they reach end-of-use. In small electrical appliances, 70% of the weight of the product must be
recovered (50% re-used or recycled, and the rest converted to energy).
The extent and methods of implementation of the Directive vary by country. Belgium and
The Netherlands have had collection and recycling systems operating for a long time, whereas
Britain and Italy are to take the first steps in mid-2007. In each country, Groupe SEB participates
in the eco-organizations which run these collection systems, and is particularly involved in
France where it holds the chairmanship of Eco-Systèmes (see inset below). Other countries
around the world, such as Japan, China and Turkey are exploring this problem.
Europeans generate
an average of 18 kilos of
electrical or electronic
waste per head every year.
The WEEE European Directive
has set a waste target of
4 kilos per head collected
via eco-organizations by
the end of 2006. Belgium
is in the lead with 7 kilos
per head, while France
is at about 3 kilos.
Britain and Italy
have not yet started their
collection systems.
RECYCLING SYSTEM GETS UNDER WAY
“Eco-Systèmes is one of the four eco-organizations approved by the French authorities in August 2006. It brings
together most of the major manufacturers and distributors of electrical and electronic products and represents
some 70% of the amount of waste to be processed. We collect the recycling fee paid by the consumer at the time
of buying the product. The funds collected are used to run the recycling system. We sign contracts with selected
logistics operators and waste recycling centres. End-of-use products are collected from several thousand
collection points in France, notably from retailers (who are required to take back a used product when the
ALAIN GRIMM-HECKER,
Chairman,
Eco-Systèmes.
customer buys a new one), as well as from waste sorting centres and Emmaüs community centres which deal
in second-hand goods. These products are then transported to recycling points where they are dismantled,
stripped of pollutants such as greenhouse gas refrigerants, and their various metal or plastic parts are sorted
for recycling or waste-to-energy conversion. We also help our members with informing consumers, particularly
on the recycling fee. The recycling system was set in motion on 15 November 2006, and will build up its
operations during 2007.”
80
Consumer recycling fee in France until 2011
Since 15 November 2006, a recycling fee has been applied in France to electrical and electronic
products, and this is clearly marked on the sale tag beside the retail price. This fee represents
the cost of collecting and recycling the product at the end of its life-cycle, and is paid over to
the eco-organizations who run the recycling system. These organizations fix the amount of the fee
in consultation with the public authorities. For most Groupe SEB products, this fee is about
€ 0.5 (from €0.1 for an electronic thermometer to €2 for a micro-wave oven), though it can
be as much as €13 for large appliances such as a fridge.
After 2011, this recycling fee will no longer feature on the sale tag, as products then reaching
end-of-use should have been designed for easier recycling or waste-to-energy conversion.
However, manufacturers will continue to pay a reduced eco-organization contribution which will
be absorbed in the retail price of the product.
ECO-LOGISTICS:
REDUCING TRANSPORT POLLUTION
Optimum loading
Groupe SEB’s ecological approach also applies to the transport of its products from the factory
or supplier to the Group’s logistics platform, and then on to the distributor warehouse. Contracts
with road haulage companies include a sustainable development clause covering, for example,
Member of
engine type, recycling of oil and fuel consumption. The Group also aims for an optimum vehicle
loading rate: in 2006, this was maintained at 92% in France.
Priority to environment-friendly transport
While road haulage is still dominant, Groupe SEB would like to increase its use of more
environment-friendly methods such as water transport. Thus, for example, since 2006, the new
by road. Most intercontinental freight uses maritime transport.
Warehouse_ USA
St Petersburg warehouse is supplied by waterway from Rotterdam with products from France
for distribution in Russia and the CIS countries. Previously, these products arrived from France
81
IMPACT ON THE ENVIRONMENT - WORLDWIDE 2006
excluding new acquisitions (All-Clad, Panex and Lagostina)
Inflow
Factories
u
1. Direct raw materials for
Outflow
Comments
1. Finished manufactured products
Finished electrical products, 70%
(excluding sourced products)
manufactured finished products
215,000 t
and recoverable (WEEE
u recyclable
standard); finished cookware
(excluding sourced products)
products 90% recyclable and
recoverable.
Motors
5,345 t
Metals
61,100 t
Plastics
45,550 t
Packaging
34,800 t
Sub-assemblies and Other
69,280 t
TOTAL
2. Special industrial waste (SIW)
1,261 t
3. Ordinary industrial waste (OIW)
12,317 t
100% treated in compliance
u SIW:
with current standards.
74% recycled or recovered
u OIW:
(9,139 t).
216,075 t
4. Process sludge
100% disposed of in approved
u
6,342 t
landfills.
5. Atmospheric emissions (natural gas)
37,223 t
CO : 37,173 t
u NOx
& N 0: 49 t
2
2
SOx: 0.36 t
2. Indirect raw materials
u
6. Wastewater to treatment plants
Of which 587,201 t in the Group’s
u
1,243,499 t
own wastewater treatment
for processes, buildings and employees
facilities and 656,298 t in
Gas
Fuel
Air (02)
Water
Other
TOTAL
13,072 t
municipal water treatment plants.
205 t
26,593 t
7. Discharge in water
1,243,455 t
0.38 t
16,243 t
in wastewater discharged from
1,299,567 t
the Group’s treatment facilities.
8. Disposal in soil
82
0t
TOTAL INFLOW
annual maximum
u Authorized
of 0.38 tonnes of metal
1,515,642 T
TOTAL OUTFLOW:
processes generate no
u Our
discharge into soil.
1,515,642 T
GLOSSARY
Bouton report: French official text of September 2002 which sets
IFRS: International Financial Reporting Standards – new
out recommendations for better corporate governance of listed
European accounting standards applicable since 1 January 2005.
companies, and in particular greater independence of boards of
directors.
ISO 9001: International Standards Organization certification for
quality management.
CECED: (Comité Européen des Constructeurs d’Equipement
Domestique): European Committee of Domestic Equipment
Manufacturers.
environment management systems
ISO 14001: International Standards Organization certification for
Club Demeter: brings together business and public services
Labour rights statement: Groupe SEB requirements imposed on
involved in the logistics chain to promote environment-friendly
its suppliers in relation to labour rights and conditions based on
methods.
the SA 8000 international standards.
Environment statement: a commitment by the supplier to
NER: (NRE: Nouvelles Régulations Economiques) The French law
participate in the Group’s environment protection effort and
of 15 May 2001 on New Economic Regulations, requiring
provide data on this subject.
companies to report on their efforts to integrate the social and
environmental consequences of their activities.
Eco-design: design which seeks to minimize the environmental
impact of products at every stage in their life-cycle.
OIW: Ordinary Industrial Waste. Non-hazardous, non-inert waste
which can be processed in household waste treatment facilities.
Eco-logistics: reduction of environmental nuisance at every stage
of the logistics chain.
OHSAS 18001: A set of international standards on occupational
Eco-organization: a non-profit organization accredited by the
public authorities which carries out legal obligations on behalf of
RoHS: European Directive on Restriction of Hazardous
its members in the area of collecting and processing waste.
Substances such as lead, mercury, cadmium and hexavalent
chromium in electrical and electronic equipment.
Eco-production: control and enhancement of the environmental
performance of industry to ensure that factories respect the
SA 8000:
environment and avoid potential ecological risks.
standards for businesses which control and monitor working
A set of international corporate accountability
conditions in relation to health and safety, the non-use of child
Eco-statement: Group specifications binding on suppliers, which
labour and other areas.
prohibit the use of hazardous substances in products and
components.
SIW: Special Industrial Waste – more sensitive waste which must
be processed in specialized facilities.
Global Compact: international initiative by the UN with the
participation of businesses, NGOs and others to promote a set of
ten principles covering human rights, labour law, the
environment and anti-corruption.
Global Reporting Initiative (GRI): an initiative of the CERES
(Coalition for Environmentally Responsible Economies) which
draws up and issues guidelines on sustainable development
reporting.
WEEE: Waste Electronic and Electrical Equipment.
health and safety management.
83
NER/GRI* COMPARATIVE TABLE
NER*
GRI*
SOCIAL PERFORMANCE INDICATORS
NR1
PAGE
Staff, staff turnover
52
Overtime hours and external staff
NR2
EQUIVALENT
22-23
LA1,2
24-25
LA2
Redundancy and job-protection plans, reclassification measures, re-employment
and staff support measures
NR3
PAGE
54-55
24
Working time
Absenteeism and motives
NR4
22, 26
Remuneration, social charges, bonus and profit-sharing schemes
Male-female equality
59
24
NR5
Labour relations and collective bargaining agreements
NR6
Health and safety conditions
50, 58
25
LA5, 6, 7, 8
NR7
Training
50, 56
25-26
LA9
NR8
Integration of disabled people
59
22
LA10, 11, HR4
NR9
Community projects
NR10
Extent of sub-contracting, relations with suppliers
64-65
HR2
HR1, 3, 6, 7
NR11
NR12
56
LA10
LA3, 4, HR5
50, 72-74
How the company promotes ILO conventions and measures with its suppliers and
50-51
subsidiaries
64-65
How the company takes account of the impact of its activities in terms of
55, 74
SO1
employment and regional development
Relations with stakeholders
61-69
ENVIRONMENT PERFORMANCE INDICATORS
NR14
Total water use
78, 82
27
EN5
78
27
EN3, 4
78, 82
27
EN1, 2
Total energy use
Total raw-materials use
NR15
Measures taken:
51
- to improve energy efficiency and use of renewable energy resources
79
- to improve the conditions of land use
- to reduce emissions and discharge (into air, water, soil)
- to reduce waste
78, 81-82
78, 82
- to limit noise and olfactory nuisance
84
NR16
27 EN8, 9, 10, 12, 13
28
EN11, 15
-
- to limit impacts on biodiversity
79-81
- to ensure compliance of the company’s activities with relevant government regulations
79-80
Measures for environmental monitoring or certification
65, 77
28
Expenditure on efforts to prevent the company’s activities from affecting the
78, 80
101
EN6, 7, 14
environment
Existence of in-house environment management services
77-82
Training and information of employees
78-79
Structures in place to remedy accidental pollution with consequences outside
77-82
company premises
Resources devoted to minimizing risks, provisions and guarantees
Amount of compensation paid during the year as a result of legal action for
77-81
aucune
environmental damages
Targets set by the company for its foreign subsidiaries
77-82
Corporate and Sustainable Development Report
* NER: New Economic Regulations In France
Reference Document
* GRI: Global Reporting Initiative
EN16
Table-top ovens
n°2
n°1
n°3
NORTH AMERICA
EUROPEAN UNION
ACKNOWLEDGMENTS
8,955
FACTORIES 13
1,010
FACTORIES 3
EMPLOYEES
EMPLOYEES
1,283
FACTORIES 3
EMPLOYEES
2,493 EMPLOYEES
3 FACTORIES
SOUTH AMERICA
actifin
www.groupeseb.com
GROUPE SEB IN 2006
.01. GROUP PROFILE
2006
CORPORATE AND
22
30
38
INTERNATIONAL
BEING COMPETITIVE
52
60
70
76

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