Annual Report 2009
2009
ANNUAL REPORT
Susana Wu Chen
11023481
Ilya Fabian
10011188
Simona Majerská
11013613
Annual Report | The Wheels Of Holland
Page 1 of 28
IBMS AP1: IP4
Annual Report 2009
IBMS AP1: IP4
WELCOME TO OUR ANNUAL REPORT
Table of Contents
FINANCIAL SUMMARY............................................................................................................................. 4
Letter to Shareholders ............................................................................................................................ 6
COMPANY OPERATION ........................................................................................................................... 8
Company overview ............................................................................................................................. 8
Goal ..................................................................................................................................................... 8
Mission ................................................................................................................................................ 8
Future strategy.................................................................................................................................... 8
Company Structure ........................................................................................................................... 10
Marketing strategy & Sales ............................................................................................................... 12
Sales .................................................................................................................................................. 13
Production plant ............................................................................................................................... 14
Distribution Center ........................................................................................................................... 14
Manager type .................................................................................................................................... 14
Global strategy .................................................................................................................................. 14
Local strategy .................................................................................................................................... 14
Marketing campaign ......................................................................................................................... 15
Promotion ......................................................................................................................................... 15
Public Relationship ............................................................................................................................ 16
Market share ..................................................................................................................................... 16
Press release .................................................................................................................................. 17
.......................................................................................................................................................... 17
Main Event ........................................................................................................................................ 18
.......................................................................................................................................................... 19
FINANCIAL STATEMENTS ...................................................................................................................... 20
STATEMENT OF FINANCIAL POSITION .............................................................................................. 20
STATEMENT OF CHANGES IN EQUITY ............................................................................................... 21
STATEMENT OF INCOME................................................................................................................... 21
STATEMENT OF CASH FLOW ............................................................................................................. 22
Notes to financial statements ........................................................................................................... 23
Analysis of Financial statements ....................................................................................................... 23
Page 2 of 28
Annual Report 2009
IBMS AP1: IP4
Profit Margin ................................................................................................................................. 23
Return on Assets ........................................................................................................................... 23
Return on Equity ........................................................................................................................... 23
Turnover ratio ............................................................................................................................... 23
Debt to Equity ratio....................................................................................................................... 24
MAIN EVENTS .................................................................................................................................... 24
Chief Marketing Officer ........................................................................................................................ 25
Chief Executive Officer .......................................................................................................................... 26
Chief Financial Officer ........................................................................................................................... 27
Page 3 of 28
Annual Report 2009
IBMS AP1: IP4
FINANCIAL SUMMARY
After major decrease in profits in 2007, The
Wheels of Holland learned from the mistakes
and recorded a huge upturn in both revenues
and sales in the past 2 years. Because of
undertaking successful expansion of the
corporation and building new factories in
Asia, we decreased cost
of production, met the demand for bicycles
globally and therefore recorded profit of €
39 381 925. Net turnover and profit
development is shown in the graph below, as
well as the profit contribution per country in
the year 2009.
Net Turnover and Profits
of The Wheels of Holland
€90,000,000.00
€80,000,000.00
€70,000,000.00
€60,000,000.00
€50,000,000.00
€40,000,000.00
€30,000,000.00
€20,000,000.00
€10,000,000.00
€€(10,000,000.00)
1/2005
2/2005
1/2006
2/2006
Profit
1/2007
2/2007
1/2008
2/2008
Net Turnover
Profit contribution per country
10% 9%
10%
20%
16%
6%
29%
France
United Kingdom
The Netherlands
Germany
Brazil
Denmark
The United States of America (US)
Page 4 of 28
1/2009
Annual Report 2009
We achieved €76 370 072,04 in sales revenue
while increasing our market share to 11,35%
globally. Sales and market share, however,
are not the only upward-sloping figures in the
financial statements. Earnings per share are
continuously raising, just in 2009 it has
IBMS AP1: IP4
increased by 60%. Issuance of 1 000 000
shares was a successful step, therefore we do
not exclude possibility of issuing 200 000
more shares in the following fiscal period. The
trend in EPS is shown in the graph below.
EPS
€ 40.00
€ 35.00
€ 30.00
€ 25.00
€ 20.00
€ 15.00
€ 10.00
€ 5.00
€ 0.00
-€ 5.00
1/2005 2/2005 1/2006 2/2006 1/2007 2/2007 1/2008 2/2008 1/2009
EPS € 0.27 -€ 0.47 € 3.58 € 4.86 € 0.24 € 10.46 € 21.87 € 24.39 € 39.14
The Wheels of Holland generated adjusted
free cash flow of €31 million in the first half of
2009, well ahead of the initial position of
around €23 million for the year. This shows
the improved profitability and net working
capital performance within the year in the
company. We accomplished the operating
cash flow positive milestone a year ahead of
our expectations.
The goal for the next fiscal periods is to make
our best to avoid any fluctuation and sustain
the steady growth of the company´s financial
figures such as EPS, profits, revenue, sales,
etc.
Page 5 of 28
Annual Report 2009
IBMS AP1: IP4
Letter to Shareholders
The Wheels of Holland´s
most important news in 2009
was our increased market
share accompanied by profit
maximisation
Dear Shareholder,
Thank you for choosing the brand The Wheels
of Holland as an international producer of
bicycles with the especial focus to innovations,
developments and trends.
Hereby, we are pleased to provide you with an
Annual Report of the company performance
between second half of 2008 and the first half
of 2009.
The report discloses all necessary information
about the marketing decisions and strategy,
financial performance, investments and
developments.
At the moment The Wheels of Holland is
acknowledged local brand of 7 western
countries in Europe, North and South
America. At the beginning of 2009 we
have invested in to construction of a large
factory in China and Japan due to a good
sailing seasons and excess in demand from
the previous three years. Furthermore, we
have opened new distribution centers in
Germany, France and U.S. so that we were
able to put the cost of production of
bicycles down. On the highly competitive
market we have adapted a new pricing
strategy and increased our investments in
to market perspectives within each selling
country.
From that point The Wheels of Holland
have finally start increasing its market
share with 13.5% this year.
The Wheels of Holland has closed its fiscal
year at the middle of 2009 with high profit
growth of 60.48% and 82% from the sold
inventory. These indicators have brought
to our company a profit of over
€39.000.000 in cash and new opportunity
for investing. With a positive business
cycle and enlarged current account, our
marketing specialists have implemented a
research on the current organization
structure. From the revealed exploration
we are considering to invest 1.5 million
euro to the new organizational structure
that has broader and more secure bases
for our company growth.
As a company with a focus on future profit
maximization through innovation and
social contribution, we are looking
forward to hearing your feedbacks and
opinions about the performance of The
Wheels of Holland today.
Sincerely,
Susana Wu, CEO
Page 6 of 28
● ● ●
Company
Operation
● ● ●
Annual Report 2009
IBMS AP1: IP4
COMPANY OPERATION
Company overview
Mission
The Wheels of Holland is one of the
largest bicycle manufactures on the
Netherland market in terms of sales
and is one of Europe’s primary
producers. The company provide
services and full responsibility for the
quality and the comfort designed with
experience gained throughout endless
roads across the Netherlands. The
bicycles are produced to meet different
consumer needs. The company
products vary from normal bikes for
everyday and travel use, to racing
bikes for competition purposes and
delivery bikes. The bicycles are sold to
retailers who offer end consumers
professional advice and services. All
bicycles are developed in the
Netherland, Japan and China, the
company’s new factories.
Wheels of Holland strive to achieve
profitable growth both now and in the
future by providing high quality bicycles
yet still benefit the environment. The
company wants to:
Goal
Wheels of Holland`s goal is to be one
of the top bicycle manufacturing
company in the Netherlands, providing
innovative and quality products to our
customers and secure high sales by
offering
superior
environmental
transportation of remarkable value in
sense of quality and price. Company`s
financial objectives is to allocate capital
profitability toward growth initiatives
and to maximize earnings by infiltrating
Europe and Western countries.
-
To internationalize the business
-
To expand sales and strengthen
brand
To secure the reputation for
-
innovation, quality and
trends
by
means
development activities.
new
of
Future strategy
In the beginning of 2006, Wheels of
Holland was intensively targeting the
Netherlands, United Kingdom and
Denmark to become the market leader.
The company has a good beginning
and expands its sales in France and
Germany. However Wheels of Holland
encounter some loses in Denmark due
to crises, which leads to the decision to
expand production overseas in 2007 in
order to meet the demands of
costumers. The company has a sustain
revenue and aim to further invest in
research and development and
innovation of production. The next step
towards the future is to sustain and
reinforce the growth of the company in
a more efficient way by shifting
internalization
to
efficiency
improvement.
The strategies for the upcoming year
are:
Page 8 of 28
Annual Report 2009
The company experiences a low
market share in the year of 2008.
Wheels of Holland market share were
average 10.10% (second half of 2008
8.86%
and first half of 2009). The aim of the
company is to increase its market
share by 30% in the upcoming years.
11.35%
The company internationalized 63.69%
of sales in Netherland, Denmark,
France, Germany, United Kingdom,
United States and Brazil and cover
70% of sales around the world. The
IBMS AP1: IP4
30%
future
strategy
is
to
further
internationalize
its
business
by
reaching 70% and cover 80% of the
world. Wheels of Holland will also cut
cost of production.
Internationalized
World Cover
66.01%
70%
First Half of 2009
Second Half of 2009
63.69%
70%
Goal
Goal
70%
80%
Page 9 of 28
Annual Report 2009
Company Structure
The Wheels
of
Holland
aims
sustainably and raise the status of
bicycles in the modern society. The
Wheels of Holland is a fast growing
company located in the heart of the
Netherland in terms of sale. The
achievement is due to the broad
product line that we offer such as
Western
Region
IBMS AP1: IP4
normal bicycles, racing bicycles and
delivery bicycles that design to meet
costumer’s requirement. The company
has three factories and operates in 7
countries around the world, namely in
Denmark, Germany, France, Brazil,
United States, United Kingdom and
Netherland itself. As a fast growing
company, we respond to trends and
diversify the product from competitors.
Europe
Region
Nethelands
USA
Denmark
Brazil
France
Germany
UK
Page 10 of 28
Annual Report 2009
Wheels of Holland operate according
to the Geographic structure which has
a more pleasant outlook for the
company.
This
structure
is
decentralized which allows each unit of
business to operate as its own entity
based on where it is located. This
structure allows the Wheels of Holland
to improve its performance by hiring
local managers who have a better
understanding of local market and
social environment.
IBMS AP1: IP4
Meeting local needs will provide us the
opportunity to set the most beneficial
prices for our products, moreover keep
the market share strong by offering a
better customer service.
Each
manager will have more space to
design its own marketing strategy that
will
improve
flexibility
of
our
performance on the global market.
Page 11 of 28
Marketing strategy & Sales
Netherland Denmark
Germany
France
United
States
√
Brazil
China
Japan
√
United
Kingdom
√
Sales
√
√
√
√
√
√
Production
Plant
Normal
X
X
X
X
X
X
Large
Large
Distribution X
Center
X
X
X
X
X
X
X
X
Manager
Type
Local
Local
Local
Local
Local
Local
Local
Local
Local
Autonomy
Fully
Partly
Partly
Partly
Partly
Partly
Partly
No
No
Market
Research
√
√
X
X
√
X
X
√
√
Thorough
Thorough
Thorough
Normal
Thorough
Normal
X
X
Investment Normal
Market
Perspective
Sales
The Marketing strategy of The Wheels
of Holland is to ensure long term
loyalty of its customers to its products
and brands. Through communication
with retailers we will ensure to respond
to their needs, and able to market our
products in line with the customer
demand.
They
are
considered
as
environmentally friendly from of
mobility and a rapid means of
transportation
in
inner
city
environment. People in all age group
are placing increasingly strong focus
on health factor. Cycling allows fitness
to be integrated into everyday life.
Wheels of Holland operate its business
through three regions namely Europe,
Western and Asia. The Europe region
comprise of Netherlands, Denmark,
Germany, France and United Kingdom.
Western region consist of America and
Brazil. The Asia region comprises
China and Japan. Main reason Wheels
of Holland choose to target these
countries because of the large
population. The most profitable sales
derived
from
Denmark,
United
Kingdom and United States.
Racing bikes are especially design for
competition purposes and high level
sportsperson. The racing bikes are
made of high quality materials, super
light weight at the same time provides
comfort while racing. Delivery bikes are
tailored for small business that needs
bicycles as a convenient and fast way
to delivery their product in the busy
cities.
The bicycle market is split into three
product
groups
with
primary
differentiation between normal, racing
and delivery bikes. Normal bikes are
design for daily use in modern society.
Denmark, United Kingdom and United
States are Wheels of Holland most
important sales markets. The market in
Denmark encounters a decrease in
sales volume by 18% in the first half
year of 2009 compare to 2008 but is
still manage to be the most profitable
country due to high sales prices. The
Annual Report 2009
Denmark market generate revenue of
€95.906.822, - in 2009. Bicycles sales
also decline in United Kingdom by
25.8% in 2009 compared to previous
year. However generate a revenue of
€7.829.474, - due to high sales prices.
The United States market experience a
growth in sales by 27.8% with
substantial revenue of €7.829.474. The
United States market seems as a
stable in comparison with € 1.271.261,
- revenue made in second half of 2008.
Production plant
Wheels of Holland were established in
2004 in Netherland and manufacture in
a normal size factory. The company
expand its market and comprise
sustainable grow in sales. In order to
meets the demand of bicycles from its
customers, the company decided to
shift it production buy building two
large factories in Japan and China.
The cost of production was low in the
Asia region, therefore will be beneficial
for the company. Wheels of Holland
manufacturing structure are very
flexible which allows the company to
adjust to the seasonal pattern of
bicycle production.
Distribution Center
No distribution center is build at the
operating countries. The factory in
Netherlands supply bicycles to Europe
and the Western region. China and
Japan acts as a spare for the
company. The company’s sales was
increasing, the factory in Netherlands
itself cannot supply the quantity of
bicycles demanded. China and Japan
therefore fill in the gap of production.
IBMS AP1: IP4
Manager type
Managing business around the globe,
Wheels of Holland choose to use the
geocentric attitude. In other word, the
company has a world oriented view
and focus on using the best people
from around the globe to manage its
business. Local managers have a
better understanding of the culture
from the country.
Global strategy
Wheels of Holland global strategy are
to further extend it strength through
investing in research and development
and internationalization of its sales
activities. By doing so, the company’s
purpose is to continue the growth that
it has attained over the recent year.
Local strategy
The company’s local strategy is to
provide its target market a bicycle that
meets their requirements. Each
country is based on the market
oriented strategy which the strategy
indentify goals and focuses on the
action based on the structure of the
marketplace.
Business
in
each
operating country act in response to
what the customers want. In order to
compete
with
competitors,
the
company
is
perceptive
of
its
customers’ needs.
Page 14 of 28
Marketing campaign
Wheels of Holland target groups are
individual consumer and distributors.
Individual consumer can be targeted
through our website. Distributor will be
targeted through deals and sales by
representative
of
the
company.
Distributors can purchase a wider
quantity of bicycles. Also distributors
help in the selling of the bicycle to the
end consumers.
The company
marketing objective will be to develop
strong brand name recognition and
loyalty among its customers.
The wheels of Holland marketing
communication objective is firstly build
brand awareness within the retail
bicycle industry by setting up a
marketing campaign. The overall
objective is to increase the brand name
The Wheels of Holland will generate its
message in an emotional appeal to
attract more attention and create
believe in our brand. The message we
and brand image, in which will increase
sales. The company will launch
marketing campaign during this year
Olympic racing game to target market
from unawareness to awareness. The
key is to build a long lasting
impression. Once awareness is
created, audience might still have little
knowledge of the company. Using
promotional materials such as print ads
can show the design of the company
and also the usage of press release
will keep the buzz going about the
product.
When
awareness
and
knowledge is created the audience
must be moved to the liking stage. The
wheels of Holland has to position itself
as the top manufacture of bicycle in the
eye of the consumers, therefore
consumer will prefer its products rather
than competitors product.
are sending to our audience is “cycling
is healthy and good for the
environment.
Promotion
For the marketing, Wheels of Holland
will be using the direct marketing
approach. Direct response marketing is
cost efficient and the best form of
communication to target our endconsumer and retailers. Tools of direct
marketing is face-to-face selling, online
marketing, direct mail marketing and
catalog marketing.
Direct mail is very fast and effective
way to reach our current and potential
Annual Report 2009
clients. In our business Email found
many ways of using it. Common
benefits from the direct email are
reaching response and drawing
attention,
making
agreements,
arranging the meeting, building strong
relationship We have a well-designed
mail advertisement that provides a
directly link to our website.
Our website is powerful online
marketing tool that has been modified
up with a latest web technology that
gave an opportunity to make it easy in
use and memorable. There is all
necessary information about the
prices, delivery cost, quotas, VAT, new
bicycles design and release, marketing
tendency and so on. We have adopted
new
development
of
Google
Multilanguage platform to make instant
translation of our website according
with preferences of the visitors.
There are exceptions with biggest
retailers and loyal partners for whom
we arrange face-to-face meeting
before every new bicycle collection
release.
Face-to-face
meeting
conducted by our marketing specialist
that is mainly involve a presentation
about
new
bicycles
collection,
distributing
of
catalogues
and
establishing strong relationship with a
retailer.
IBMS AP1: IP4
customers is equally important as
creating a new demand and affection
of the consumers to our brand.
Establishing public recognition we want
to put our company’s logo as
supporters of healthy lifestyle and
people who suffer from health
problems. There are many sport
events during the summer in which we
would like to invest. It will help us to
increase the market share and set
strong rivalry to the other bicycle
brands.
Market share
In the second half of 2008, Wheels of
Holland was generating a profit growth
of 11.50% and achieved sales revenue
of €60.839.039, 72,-. Even through
high sales growth, the company
experiences an immense decrease in
market share with only 8.86% compare
to the first half of 2008. This is mainly
cause by constant change of pricing
strategy of the company. However the
company recovers from its low market
share and achieved value of 11.35%
compare to the second half of 2008.
The company growth in profit has
reach 60.48% and generates profit of
€39.141.526, 41,-
Public Relationship
Tendency of living healthy is creating a
huge buzz. The company will promote
the bicycles through media, public
organization and event to generate an
impact on society. Public relation has a
strong impact on public awareness at a
low price. We believe that participation
in public campaign can perpetuate and
establish a good brand image on a
long run. Setting a right mood with
Page 16 of 28
Annual Report 2009
IBMS AP1: IP4
Press release
Tienhovenselaan 114
2516WH Den Haag
Jean Conteau
Human Resources Manager
Google
Sacrelise 236
2514CC Paris
Bicycles have a strong connection to French culture even though everybody thinks of
the Netherlands as the country of bikes. Since the term “bicycle” was invented in
France, and everybody in Holland loves it, we would like to create a connection
between these two countries of two-wheelers. Are you eager to distribute an
environmentally friendly product supporting healthy and active lifestyle, by which you
can get fast from place to place without waiting in traffic jams? All customers are
looking for it, do not hesitate to use this unique opportunity.
Wheels of Holland, a rapidly emerging bicycles producer will help you reach this! We
offer long-lasting and unchanging normal, racing and delivery bicycles of the highest
quality. Being a partner of Wheels of Holland means counting on both products and
service of the highest quality. Distribution, maintenances and replacement are all
granted, as well as the conducting all orders and billing processes. In addition,
personalized bike decorations are available too.
Provide your customers with our products and make them feel unique. However, not
only them- becoming our partner means getting an oversize bike Wheels of Holland
decorated consistently with your shop for the promotional purpose.
Contact our Sales Department during office hours by calling 070-236 36 36 or
sending an email to wohsalesdepartment@gmail.com
Wheels of Holland
Be better, bike faster, think greener
Page 17 of 28
Main Event
Throughout the year, Wheels of
Holland encounter event that impact
the company’s business. The World
Health Organization announced in
2006 the circulation of flu in Demark
and Netherlands. In the same year
Denmark was in economic crisis.
These events have decreases the
demand for bicycles in Denmark and
Netherlands. In 2007, Netherlands,
Denmark and France were threatening
by swine flu. This has declined sales
and profit drastically in Denmark and
Netherlands. Denmark had a loss of
€619.917, - and Netherlands profit
decrease from €553.399, - (second
half of 2006) to € 97.945, - (first half of
2007). Wheels of Holland entered the
France market in the first half of 2007.
The swine flu has a small effect on the
sale in France. Although the demand
was not enormous, the company
manages to make €502.316, - in profit.
As a globalize company, adapting to
changes is essential for Wheels of
Holland.
●
●
●
Financial
Statements
●
●
●
Annual Report 2009
IBMS AP1: IP4
FINANCIAL STATEMENTS
STATEMENT OF FINANCIAL POSITION
Page 20 of 28
Annual Report 2009
IBMS AP1: IP4
STATEMENT OF CHANGES IN EQUITY
Statement of Changes in equity
Wheels of Holland
as of June 30, 2012
Balance 2nd half of 2008
Total
comprehensive
income
Balance 1st half of 2009
Retained earnings
68 664 515,00 €
39 141 527,00 €
107 806 042,00 €
STATEMENT OF INCOME
Statement of Income
Wheels of Holland
as of June 30, 2012
Net turnover
Cost of sales
Gross sales margin
Costs of sales
General administration costs
First half of 2009
€76,370,072
€45,232,760
Second half of 2008
€60,839,040
€35,339,900
€31,137,312
€3,397,812
€3,314,598
€25,499,140
€2,914,642
€3,851,424
Total costs
€6,712,411
€6,766,066
Operating income
€24,424,901
€18,733,074
Other company revenues
Other company costs
Interest income
Interest costs
€14,836,625
€0
€0
€ 120,00
€5,777,000
€0
€0
€ 120,00
Financial result
€14,716,625
€5,657,000
Operational earnings before
taxes
Taxes over operational earnings
Operational earnings
Incidental losses and profits
€0
Taxes over exceptional result
€0
Exceptional result after taxes
€39,141,526
€24,390,074
€0
€39,141,526
€0
€24,390,074
€0
€0
Net income
€39,141,526
€24,390,074
€0
€0
Page 21 of 28
Annual Report 2009
IBMS AP1: IP4
STATEMENT OF CASH FLOW
Statement of Cash Flow
Wheels of Holland
as of June 30, 2012
First half of 2009
Second half of 2008
Sales revenues
€76,370,072
€60,839,040
Received interest
Other income
€0
€0
€0
€ 35,00
Cash flow from operational activities
€76,370,072
Account payable
Remunerations
Paid interest
Distribution costs
Dividends
Sustainability projects
Costs market research
Marketing costs
Other costs
Emission costs
Research and development
Taxes
Cash flow from financing activities
Paid company taxes
Change in short term debt
Change loan
Change investments
Emission
€38,288,375
€1,469,322
€ 120,00
€1,950,190
€0
€ 300,00
€0
€1,447,622
€1,252,516
€0
€ 200,00
€0
€60,874,040
€29,470,430
€1,469,322
€ 120,00
€1,464,483
€0
€ 400,00
€0
€1,450,159
€1,720,800
€0
€ 200,00
€0
€45,028,025
€36,295,194
€31,342,047
€24,578,846
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Cash flow from investment activities
Investment in property
€ 350,00
Investment in equipment
€0
Investment in machinery
€0
Change in cash
€0
€1,825,000
€0
€ 700,00
€ 350,00
€2,525,000
€30,992,047
€22,053,846
Page 22 of 28
Annual Report 2009
IBMS AP1: IP4
Notes to financial statements







Property:
distribution
centers,
offices and factories in possession
of Wheels of Holland which are
adjusted by depreciation
Machinery: devices and equipment
in possession of Wheels of Holland
which are adjusted by depreciation
Inventory: Total value of products
in inventory
1.000.000 ordinary shares issued
in 2006, no preferred shares
No cash dividends paid throughout
the years 2006 to 2008.
Long bank credit: Total value of
long term loans borrowing from the
bank.


Research
and
development:
includes cost of environment
research, product research, safety
research and features research
undertaken by Wheels of Holland
in order to improve efficiency of
production and sales in a given
country
Remunerations: Payments for labor
including the wages of employees
including expats and foreign
managers.
Loan of €400 000 has been
borrowed in the second half of
2007 from bank with interest rate of
3%. The repayment is being paid
back at the end of each fiscal
period.
Analysis of Financial statements
Profit Margin
Profit Margin = Net Income / Net Turnover
Profit margin=€39,141,526 / €76,370,072
Profit Margin of Wheels of Holland is 51,25%
Profit margin is an indicator of a corporation's
pricing strategies and how well it controls
costs. Shareholders can see profitability of
sales expressed in percentage, therefore we
can claim that our profit margin represent a
low risk.
Return on Assets
Return on Assets = Net Income / Total Assets
Return on Assets=€39,141,526 / €111,806,042
Return on Assets of of Wheels of Holland is
35%
ROA express the profitability of the assets in
terms of generating revenues.
Return on Equity
Return on Equity = Net Income / Group Equity
Return
on
Equity==€39,141,526/
€107,806,042
Return on Equity of Wheels of Holland is
36,3%
ROE measures a company's efficiency at
making profits from each unit of shareholders'
equity.
Turnover ratio
Fixed Assets Turnover ratio = Net Turnover /
PPE
Fixed Assets Turnover ratio = €76,370,072 /
€8,006,979
Fixed Assets Turnover ratio of Wheels of
Holland is 953,79%
It is a measure of how much turnover the firm
was able to generate with their plant,
Page 23 of 28
Annual Report 2009
IBMS AP1: IP4
property and equipment. Reasonably, the
higher the percentage is, the better. Therefore
we can say that Wheels of Holland did a really
good job.
Debt to Equity
€107,806,042
ratio
=€111,806,042
/
Debt to Equity ratio
Debt to Equity ratio = Total liabilities / Group
Equity
Debt to equity ratio indicate investors the
dependency between total liabilities and the
equity they invested in the corporation.
Debt to Equity ratio of Wheels of Holland
is1,03%
MAIN EVENTS
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Pulling out the operations from
Australia after the first fiscal period
2005: Entering Danish market
First half of 2007-Entering markets in
France and China.
Second half of 2007 Wheels of Holland
pulled out its operations from China,
However we expanded to Brazil
From 2008, Wheels of Holland
operates in Germany and USA.
Demand is high enough, moreover,
USA is one of the most profitable
countries looking at average profits.
Therefore in the future the operations
will concentrate on this market.
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Page 24 of 28
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Financial crisis in Denmark due to flu
resulted in a dramatic drop in sales in
the country, therefore our overall
profits dropped as well.
Change of our pricing strategy
influenced the demand in many
countries. Majority of demand
decreased as well as our profits
Due to high demand which we did not
meet, we decided to build a factory in
Japan and China because of low
production costs. However, Wheels of
Holland did not enter the market in
Asia, since the selling price was low
and the demand was already high in
other countries where we operated
`
Academic Year 2011-2012
Chief Marketing Officer
Name: Ilia Fabian
Age: 23 years old
Nationality: Russian
Specialization: Marketing& commerce, Economy & Globalization
Background: Hague University - Bachelor International Business Management
University of Sao Paulo – Master Economy & Globalization
In Wheels of Holland: Second half of 2004
Role: Ilia Fabian is our Marketing expert and trusted
entity since the establishment of the first factory of
“Wheels of
Holland” in the Netherlands. Today
“Wheels of Holland” is the international brand which
partially is the result of a great marketing performance
and persistence of Ilia Fabian during last five years. If to
think of a person who knows the culture of the
company from its fundamental start, then this man
would be the best representative who actually made it.
Contribution and responsibility: Presence of Ilia
Fabian in “Wheels of Holland” has been acknowledged
and perceived through his contribution, namely spread
awareness of our brand, build a pleasant public
relationship, increase demand and boost sailing in the
most profitable locations. All these contributions has
been attributed to the company growth. Main function
and execution of Ilia Fabian in “Wheels of Holland” :
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brand internationalization
marketing research
pricing strategy
budgeting strategy
inventory control
designing of commercial campaigns
manipulation of sales growth
product development
recognize trends and demand
Each of these responsibilities is a challenge of high
importance that our CMO has been taking care of. To
do business on a global scale we needed to achieve
transparency that was Ilia’s job to do. As a specialist in
economy and globalization he used his experience and
instinct to identify local trend and new opportunity for
the Wheels of Holland to expand. Within seven
countries that we are operating Ilia had designed the
most suitable global strategy that has made our brand
so recognizable. The result of it has boomed the
demand and focused our attention to the products that
has the highest potential on return from sales. He was
working close to CEO and CFO that played a significant
role in making the internationalization of Wheels of
Holland financially feasible.
Salaries and Bonuses: For the last five years the salary
of CMO has changed enormously. Current annual salary
of Ilia Fabian is 45.000 Euros (net) compared to 35.000
in 2004. That growth was motivated by successful
expand of our company and increase in sales from
production. For Ilia Fabian it has transmitted with extra
working hours and pressure from the new rivalry. Due
to Ilia is our trusted entity and stay with us since the
beginning of the company, we are interesting to keep
our employees satisfaction. Therefore, at the end of
each fiscal year we provide bonuses in amount between
2000-3000 Euros, depending on the sum of annual
achievements.
`
Academic Year 2011-2012
Chief Executive Officer
Name: Susana Wu
Age: 21 years old
Nationality: Venezuelan
Specialization: Sustainability of business, global marketing and finance.
Background: The Hague University - bachelor in International Business
Management
Erasmus University - global marketing and finance
In Wheels of Holland: Second half of 2004
Role: Susana Wu is a founder of Wheels of Holland
whose discipline and high entrepreneurial skill has built
the result of the company development today. With a
highly intensive work that we have Susana is managing
and sustaining the bridge in communication between
marketing and financial departments. Her role and
influential position was especially focused on
investments, overall company performance and
structure, monitoring governmental sustainability and
rivalry, cultivating a partnership with bicycle retailers
within seven countries.
Contribution and responsibility:
Susana´s major contribution:
 Investments decisions
 Research and development
 Building and enlargements of a new factory
 Sustainability
 Distribution centers
 Allocate production source
 Distribution centers

Make decision for geographic expansion
Susana’s active performance has been perceived
through the company constant growth within
international scale. With her smart decision we have
managed to establish 2 large factories in China and
Japan. Furthermore, we have enlarged Wheels of
Holland first factory in the Netherlands. In 2007 our
company made contribution in to social development
like: Corporate Governance, Promotion of cultural
projects, Participation of employees in social projects
and so on. In general we managed to cut our cost of
production and increase sailing price with a most
profitable countries.
Salaries and Bonuses: As a CEO of the company,
Susana’s annual salary is 50.000 euros (net) that didn’t
change for last five years. This is a good CEO salary that
compensates the pressure from hard work and risky
decisions that she is in charge of. Susana’s position
doesn’t require having any extra bonus due to it is a
typical contribution for the middle and lower line of
managers.
`
Chief Financial Officer
Name: Simona Majerská
Age: 21 years old
Nationality: Slovak
Specialization: Finance analyst
Background: The Hague University - bachelor in International Business Management
Ibiza University – master in Finance and Accounting
In Wheels of Holland: Second half of 2004
Role: Regardless on marketing success that Wells of
Holland has experienced they wouldn’t be so achievable
without a precise and analytical estimation of our CFO
Simona Majerská. Simona is a financial heart of our
company who is making primary decisions if the project
is achievable or profitable to invest. Her main role is has
to do with monitoring financial statements, project
company’s financial health condition on the long run
and work collaborative work with CEO.
Contribution and responsibility:
Simona did all major contribution for the company
financial growth:
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Financial planning
Financial risk
Projection on sales
Monitor balance sheet
Cash-flow statement
Income statement
Keep all board of directors with about the latest
financial performance.
Our company is highly dependent on the performance
of CFO on the short and long run. Wheels of Holland
had difficult time during 2005 caused by cash outflow
and poor sales. Nevertheless, Simona’s highly
outstanding financial instinct has forcasted a better
season for our company through new investments in
the market of emerging economies. Next following
years after 2005 we have made a profit with a
constantly growing return. The accurate evaluation of
our CFO has especially reflected on company’s balance
account that at the first half of the 2009 hit the record
number in cash reserve of over 95 million euros.
Salaries and Bonuses: For the last five years the salary
of CFO has changed enormously. Current annual salary
of Simona Majerska is 45.000 Euros (net) compared to
35.000 in 2004. That growth in salary was motivated by
a great performance in financial work that has
multiplied the wealth of “Wheels of Holland”. With
companies expand Simona Majerska has more hours
and responsibilities in her job. Due to Simona is our
trusted entity and stay with us since the beginning of
the company, we are interesting to keep our employees
satisfaction. Therefore, at the end of each fiscal year we
provide bonuses in amount between 2000-3000 Euros,
depending on the sum of annual achievements.