1 GB-FIMALAC 2000The present document is a translation of FIMALAC 2000 Annual Report. In the event that the french ... offer for the company in 1999. As part of the refocusing plan

Fimalac

ANNUAL REPORT

2000

“Société anonyme” with a capital of € 137,956,152.40

Head office: 97, rue de Lille - 75007 Paris - France

Registered under no. 542 044 136 RCS ParisFimalac

BOARD OFDIRECTORS

◆ HONORARY CHAIRMAN

Philippe MALET

◆ CHAIRMAN

Marc LADREIT DE LACHARRIÈRE

◆ DIRECTORS

Pierre CASTRES SAINT-MARTIN

Georges CHARPAK

Alain GOMEZ

Bernard MIRAT

Robin MONRO-DAVIES

Bernard PIERRE

Gérard MESTRALLETPermanent representative of SPERANS.

Véronique MORALIPermanent representative of FIMALAC & CIE.

Pierre BLAYAUPermanent representative of FIMALAC PARTICIPATIONS.

René BARBIER DE LA SERRE

Henri LACHMANN

Jean-Charles NAOURI

Etienne PFLIMLINPermanent representative ofBANQUE FÉDÉRATIVE DU CRÉDIT MUTUEL.

Edouard DE ROYÈRE

◆ CENSOR

Michel Castres Saint-Martin

AUDITORS

◆ STATUTORY AUDITORS

CAGNAT ET ASSOCIÉS

M. Xavier Aubry

◆ SUBSTITUTE STATUTORY AUDITORS

BEFEC-PRICE WATERHOUSE

M. Philippe Cagnat

CORPORATE OFFICERS - AUDITORS

◆ DIRECTORS PROPOSED FOR ELECTION AT THE ANNUAL GENERAL MEETING OF JUNE 5, 2001 (resolutions 7 to 11)

CO M B I N E D AN N U A L A N D

EX T R A O R D I N A RY GE N E R A L ME E T I N Gof June 5, 2001

Fimalac

CONTENTS

Chairman’s statement

Financial highlights and share data

Group structure

Fimalac worldwide

Businesses

Financial report

2

6

8

10

12

37

2000

The present document is a translation of FIMALAC 2000 Annual Report. In the event that the french

and english versions lead themselves to different interpretation, the french version alone is authentic.

Over the last two years, we have succesfully

followed a determined and selective strategy

designed to gradually transform FIMALAC into a

Business Support Services specialist.

CONTINUED REFOCUSING

OF FIMALAC AS AN

INTERNATIONAL BUSINESS

SUPPORT SERVICES SPECIALIST

In keeping with this strategy, during 2000

we focused our growth and development on two

main businesses, FACOM in tools and FITCH in

rating. These companies now represent 65% of

Group sales and 70% of operating income.

The rating business continued to expand.

Following the DUFF & PHELPS and BANKWATCH

acquisitions, FITCH has become a world leader

in this rapidly growing sector.

FACOM also had a very good year. The hand

tools and garage equipment businesses both

achieved excellent performances, putting

FACOM ahead of schedule with the business

plan implemented after our successful tender

offer for the company in 1999.

As part of the refocusing plan and as

announced previously, we continued to

withdraw from non-strategic businesses,

divesting CLESTRA (partitions and counter-

ceilings) and ANFA (office supplies). ANFA's

business largely confined to the domestic

market and too small to compete effectively

in the world market, was unable to develop

quickly enough at FIMALAC.

It therefore represented a poor fit with

FIMALAC's strategy of taking national players

and building them into global leaders. The

transaction was carried out on excellent terms,

valuing ANFA at € 50.6 million. This represented

five times the price originally paid for the

business, generating a net gain of € 29.4 million.

2 A n n u a l R e p o r t 2 0 0 0

CH A I R M A N ’S S TAT E M E N T

3A n n u a l R e p o r t 2 0 0 0

As also announced previously, we sold

ENGELHARD-CLAL's jewelry and electrical

contacts businesses, representing approxim-

ately 45% of sales. FIMALAC now holds only

49% of ENGELHARD-CLAL, which was therefore

no longer consolidated by the proportional

method effective from January 1, 2000. The

Group's 49% interest in ENGELHARD-CLAL's

income is reported on a specific line of the 2000

income statement.

Finally, the creation of FIMALAC INTERACTIVE

will consolidate the Group’s presence in the

Internet business and reaffirm our commitment

to providing the Group with technological

expertise and research capabilities within the

framework of an industrial project.

The Group is now ideally positioned to move up

a gear in its business growth and international

development, building on its two core

businesses – FITCH and FACOM – and with

additional momentum provided by its other

businesses, LBC, SECAP TECHNOLOGIES and

CASSINA, all of which are market leaders.

◆ In the ratings sector, FITCH (formerly FITCH

IBCA) significantly expanded its business

base in 2000 with the successful friendly

takeover bid for DUFF & PHELPS and the

acquisition of THOMSON BANKWATCH. The

company ranks among the world's top 3

rating agencies and is well placed to benefit

from high market growth rates, particularly

in Europe where the recommendations of the

Basle committee are expected to boost

demand for rating services.

◆ 2000 was a particularly successful year for

FACOM, both in the hand tools and garage

equipment businesses. FACOM significantly

increased its market share against compet-

itors, further reinforcing its leadership status

in Europe. FACOM also continued to develop

its presence in the e-business sector by

acquiring interests in Internet portals and in

2001 its catalogue will also be available on

the web.

◆ In the chemicals storage business, LBC kept

up its international expansion by acquiring

the CELANESE terminal in the Houston ship

channel. The company’s total storage

capacity now stands at 2.1 million cu. meters.

◆ SECAP also continued to extend its

geographic reach. After entering the Swedish

market at the end of 1999, in 2000 the

company set foot in the British market

and penetrated the American market,

by acquiring DATATECH, an addressing

specialist. SECAP reaffirmed its commitment

to innovation and web-based technologies

b y c h a n g i n g i t s n a m e t o S E C A P

TECHNOLOGIES.

◆ For CASSINA, the upscale designer furniture

specialist, 2000 was a year of accelerated

organic growth and international devel-

opment. The company now operates in

50 countries.

EXCEPTIONALLY STRONG GROWTH

IN RESULTS: EARNINGS PER SHARE

UP BY 48.5% (BEFORE AMORTIZATION OF GOODWILL)

The Group's results for 2000 reflect the solid

operating results of our subsidiaries coupled

with substantial non-recurring income.

The Group more than met its objective of € 82.3

million (FRF 540 million) in operating income

after interest, tax and minority interests

announced at the last Annual General Meeting.

On a comparable presentation basis, i.e. before

deducting employee profit-sharing, operating

income after interest, tax and minority interests

came to € 84.3 million (FRF 553 million) in

2000, up 33% on the 1999 figure of € 63.4

million (FF 416 million).

4 A n n u a l R e p o r t 2 0 0 0

After deducting employee profit-sharing, in line

with the new French accounting standards,

2000 operating income after interest, tax

and minority interests totalled € 74.6 million

(FRF 489 million), a 30.4% increase compared

with € 57.2 million (FF 375 million) the previous

year.

Net income before amortization of goodwill

reached € 108.5 million (FRF 712 million)

versus € 71.3 million (FRF 468 million) in 1999,

an increase of 52.2%. Earnings per share before

amortization of goodwill grew by 48.5%.

Net income after goodwill amortization was

€ 100 million (FRF 656 million), a 40.1%

increase.

Net income was boosted by the substantial

non-recurring profits realised on the sale of

ANFA and the acquisition of BANKWATCH by

FITCH.

THANKS TO THE GROUP’SREPOSITIONING AS A BUSINESS

SERVICES SPECIALIST

THE PRICE OF FIMALACSHARE HAS RISEN SIGNIFICANTLY

FUELLED BY INVESTOR CONFIDENCE

The FIMALAC share price gained 47%

in 2000, rising from € 24.40 on January 3, 2000

to € 35.88 on December 29, 2000. This

performance was all the more noteworthy in

that it was achieved in a year when the CAC 40

index fell by 0.5%.

The five-for-one stock split on June 7 improved

the share's liquidity. Since the abolition of the

monthly settlement market on the Paris Bourse

in late September, FIMALAC became one of the

leading stocks eligible for the deferred

settlement system (Système de Règlement

Différé - SRD).

It is worth noting that the shares are currently

trading at only 15.7 times 2000 operating


and at only 11.7 times 2000 net income

including capital gains. Consequently, the stock

offers significant upside potential, especially in

view of the quality of the Group’s businesses

and their development prospects.

This upside potential is further enhanced by the

fact that the transformation of FIMALAC over

the past two years into a business support

services specialist means that we have changed

category on the stock market. Instead of a

holding company, EURONEXT’s new classifica

-tion system terms us as a “business-support-

services” player alongside groups trading at

multiples far superior to FIMALAC’s current P/E.

OUTLOOK

The outlook for all of our strategic businesses

is good and we have therefore set as our

objective to achieve growth of approximately

25% in consolidated operating income, based

on the current Group structure and barring

unforeseen events.

M. Marc Ladreit de Lacharrière

5A n n u a l R e p o r t 2 0 0 0

6 A n n u a l R e p o r t 2 0 0 0

LBC

9%

Facom

47%

Other companies

10%

Secap Technologies

8%

Fitch

18%

FI N A N C I A L H I G H L I G H T S

2000 SALES

CONSOLIDATED SALES: € 1,336.4m (FRF 8,766m)

Sales by business segment

Operating income after interest, taxand minority interests(in EUR millions)

Consolidatedshareholders’ equity(in EUR millions)

1998 1999* 2000* 1998 1999 2000

41.8(FRF 274m)

57.2(FRF 375m)

74.6(FRF 489m)

664.7(FRF 4,360m)

738.2(FRF 4,843m)

816.6(FRF 5,357m)

Cassina

8%

* Net of employee profit-sharing.

7A n n u a l R e p o r t 2 0 0 0

20

40

30

J F M A M J J A S O N D

35

25

Ownership structureat January 31, 2001

Dividendper share (in EUR)

Fimalac share price in 2000 (in EUR)

*including 7.99% held in treasury stock

1998 1999 2000

FACOM 4,033 4,135 4,406

FITCH 700 749 1,166

LBC 501 591 642

SECAP 756 817 670

CASSINA 411 446 438

CLAL-MSX 196 199 223

FIMALAC Head Office 38 39 38

TOTAL 6,635 6,976 7,583

Employees at December 31, 2000

Fimalac€ 35.88

up 47%

1998 1999 2000

0.55

0.744

0.90

100

140

120

160

150

J F M A M J J A S O N D

130

110

Fimalac share performance comparedwith the CAC 40, basis 100 in 2000

Others 33.47%

(20.56% of voting rights)

Marc Ladreit de LacharrièreFimalac & Cie and members

of the shareholders’pact:66.53%*


Fimalac147

CAC 4099.5

Worldwide employees at December 31, 2000(on a current consolidation basis)

€ 24,40

Europe

84%

Others

2%

Americas

14%

8 A n n u a l R e p o r t 2 0 0 0

Bernard PIERRE

Alain GOMEZ

Véronique MORALI

Marc LADREIT DE LACHARRIÈREChairman and Chief Executive Officer

EX E C U T I V E C O M M I T T E Eat December 31, 2000

9A n n u a l R e p o r t 2 0 0 0

MarcLADREIT DE

LACHARRIÈRE

FIMALAC&Cie

FIMALAC

66.5% members of theshareholders’ pact *


12.1%

CASSINA

100%

96.6%

87.9%

S I M P L I F I E D GR O U P S T R U C T U R E

at December 31, 2000

* Includes 8% held in treasury stock by FIMALAC.

LBC

SECAP TECHNOLOGIES

100%

FITCH

FACOM

100%

80%

Rating agency

Hand ToolsGarage equipment

Bulk chemicals storage

Mail processing

Designer furniture

10 A n n u a l R e p o r t 2 0 0 0

FI M A L A C W O R L D W I D E

United-Kingdom

France

Belgium

Spain

Portugal

United States

Argentina

Chile

Peru

Colombia

Mexico

Brazil

South Africa

Egypt

Poland

Morocco

Algeria

Russian Federation

Bulgaria

Tunisia

Canada

Venezuela

Costa Rica

El Salvador

Turkey

Ecuador

11A n n u a l R e p o r t 2 0 0 0

Denmark

Germany

Sweden

Switzerland

Netherlands

Austria

Greece

Italy

Australia

Singapore

Hong Kong

China

Japan

South Korea

Pakistan

India

IndonesiaSri Lanka

Thailand

12 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

OPERATING HIGHLIGHTS

A new international group structure for the

tools business was created in 2000 – FACOM

TOOLS. The aim of this new organization is to

optimize group resources based on a new Marke-

ting strategy that is designed to position the

brands in relation to user businesses and to

streamline the product offering.

Under the new structure, sales activities have

been reorganized around six major sales areas,

to enhance FACOM TOOLS' coverage of the global

market and deploy the field sales force more

effectively.

A group purchasing structure has also been

created, with units dedicated to Production Pur-

chasing, Sub-contracting and Trading Purchasing,

and Overhead Purchasing.

6/8, rue Gustave Eiffel

91420 Morangis

FRANCE

Alain GOMEZChairman and

Chief Executive Officer

Garage equipment

23%

Hand tools

77%

2000 SALES:

BY BUSINESS SEGMENT

Americas

9.5%Africa

2.9%

France

40.2%Rest of euro zone

29.8%

2000 SALES:

BY GEOGRAPHIC AREA

Asia/Pacific

2.8%

Rest of Europe

14.8%

(EUR millions) 2000 1999 1998

Consolidated sales 631.6 560.8 526.0Hand tools 483.8 462.1 450.0Garage equipment 147.8 98.7 76.0International sales as % of total 59.8% 60.2% 59.8%

Operating income (EBIT)* 69.8 60.9 54.2Hand tools 63.7 54.4 50.2Garage equipment 6.1 6.5 4.0Operating income, as % of total sales 11.1% 10.9% 10.3%

Employees 4,406 4,135 4,033Employees outside France, as % of total 48.2% 47.7% 46.9%

* Net of employee profit-sharing (new French accounting standards).

13A n n u a l R e p o r t 2 0 0 0

Implementation of the new structure has

been accompanied by the launch of an industrial

plan to increase Facom Tools' manufacturing

efficiency through a system of plant specialization

by technology and product type.

On the product development side, sales of

FACOM-ELEC (a range of specialist electrical

maintenance and installation tools) launched at

the end of 1999 testify to the range's success

among customers.

The Research and Development department

continued to conduct research into new materials

and surface treatments, as well as developing

products which combine enhanced design fea-

tures and superior ergonomics while taking into

account increasingly stringent environmental

standards.

In the garage equipment business, 2000 saw

the integration of a new product family – vehicle

hoist systems – following the FOG/CEEG merger

in France and the acquisition of ZIPPO in Germany.

FACOM also pursued the development of its garage

equipment business by acquiring the German

garage engineering specialist, AUTO-CONSULT.

The FACOM-ELEC catalogue

presenting FACOM’s range

of specialist electrical maintenance

and installation tools.

14 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

in Asia and South America were particularly

satisfactory.

Sales in the United States contracted slightly

as the group refocused its efforts on the SK

brand and distribution to the Automobile and

Manufacturing sectors, all of which represent

growth drivers for the future. FACOM TOOLS

also carried out a major reorganization project

in 2000 to reposition its brands in user markets,

as well as launching an industrial plan with

the ultimate aim of focusing production on a

smaller number of more highly specialized

manufacturing facilities. The Group also kept

up its product renewal program, with the

launch of new ranges of pliers, screwdrivers

and other specific tools, particularly for vehicle

diagnostics and repairs.

Servante Gold

There are no end of uses for an ENDURO screwdriver.

BUSINESS REVIEW

◆ FACOM TOOLS

Hand tool sales came to € 483.8 million in

2000, an increase of 4.7% compared with 1999,

and operating income rose by 17% to € 63.7

million.

These increases were primarily attributable to

robust sales by the FACOM, VIRAX, BOST and

PAROLAI brands in the buoyant French market.

Business in the rest of Europe was generally

brisk, except in Germany where the car repair

market suffered a downturn, and the United

Kingdom where the strong pound had an

adverse effect on the manufacturing sector in

general.

FACOM TOOLS’ growth in the rest of the world

was driven by an aggressive sales policy,

assisted by the strength of the dollar. Volumes

15A n n u a l R e p o r t 2 0 0 0

During 2000, the new vehicle hoist systems

business was integrated into the group, with

the merger of FOG and CEEG in France, and

the acquisition of Germany-based ZIPPO

by BEISSBARTH. In the United Kingdom, the

TECALEMIT product ranges were extensively

renewed, while in Germany the operations of

AUTO-CONSULT were integrated with those

of BEISSBARTH.

INTERNET

FACOM TOOLS is actively investing in e-

business applications to extend its marketing

reach, develop direct contacts with users via its

various web sites and reinforce partnerships

with distributors.

Over 200,000 people visited the FACOM TOOLS

web sites in 2000. FACOM aims to develop user-

targeted services including catalogues tailored

to specific businesses, on-line technical

information, interactive demonstrations and

professional information zones. FACOM’s

catalogues will also be available on the

Internet as from 2001.

◆ BEISSBARTH AUTOMOTIVE GROUP

Garage equipment sales surged by 49.8% in

2000 to € 147.8 million (up 24.6% on an

identical Group structure basis). Operating

income contracted slightly to € 6.1 million, due

to rapidly expanding sales of lower margin

product families and the temporary disruption

caused by the industrial reorganization plan.

The strong growth in sales led to market share

gains. The new product families - vehicle hoist

systems and air-conditioning test benches and

maintenance systems - helped to strengthen

Facom’s position with key customers including

European automakers, vehicle inspection

networks and fast-fit installer networks.

The rationalization of manufacturing operations

led to the closure of a plant in France and the

transfer of production to the Italian plant

specialized in wheel-related products and the

German plant specialized in axle alignment

products.

Microline 4000,

wheel alignment bench.

ww

w.fa

com

.com

16 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

Operating income grew by a robust 14.6% to

€ 69.8 million, from € 60.9 million in 1999.

With operating income standing at 11.1% of

sales in 2000, compared to 10.3% in 1998

before FIMALAC’s successful tender offer,

FACOM is making good progress in its drive

to improve operating margin. The measures

already implemented in both businesses

should yield further significant profitability

gains in the years to come, in accordance with

the objectives set in the business plan.

OUTLOOK

Both hand tools and garage equipment turned

in an excellent performance in 2000, gaining

substantial market share against competitors

and reinforcing FACOM’s leadership status in

Europe.

Air conditioning

fluid regenerating

station.

FACOM is also setting up a specific Extranet

site for distributors, offering new services

such as on-line ordering, statistics, product

information and on-line technical training.

Finally, at the end of 2000, FACOM acquired a 10%

interest in CLUB AUTO (www.leclubauto.com),

an Internet portal for automotive professionals

providing specific information and services

for vehicle repairers, such as information on

tool choices, on-line assistance etc…, thus

responding to their needs.

RESULTS

Both hand tools and garage equipment turned

in an excellent performance in 2000, gaining

substantial market share against competitors

and reinforcing FACOM’s leadership status in

Europe.

Overall FACOM reported sales of € 631.6 million

in 2000, an increase of nearly 13% compared with

€ 560.8 million in 1999. Hand tools accounted

for approximately 77% of total sales with the

remaining 23% attributable to garage equipment.

ww

w.b

eiss

bart

h.co

m

17A n n u a l R e p o r t 2 0 0 0

◆ Hand tools

The year has started off well but demand is

expected to slow in the second half. However,

the industrial fittings and maintenance sectors,

which were FACOM’s main growth drivers in

2000, are expected to continue to make key

contributions to sales growth and market share

gains in 2001.

During the year, the new group structures

will become fully operational. FACOM will also

publish new catalogues unveiling its updated

product ranges, streamlined offering and

numerous new products, all of which should

provide further growth momentum.

◆ Garage equipment

The outlook for the garage equipment business

is good. 2001 will be a year of consolidation

with momentum provided by the redeployment

of sales activities, integrating the vehicle hoist

systems business, renewal of part of the wheel-

related product range and the launch of an air

conditioning equipment range.

The FACOM stand at the Cologne Trade Fair.

A full range ofscrewdrivers.

18 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

One State Street Plaza

New York, N.Y. 10004


A series of major events in 2000 allowed the

newly renamed FITCH to move up a gear in its

development and firmly anchor its position as the

world’s third largest rating agencies.

In June 2000, FITCH IBCA merged with DUFF &

PHELPS, the world’s fourth largest rating agency,

thus strengthening the agency’s capabilities in

corporate, insurance and structured finance

ratings.

The December acquisition of THOMSON

BANKWATCH – the world’s fifth largest rating

agency – broadered the range of financial services

offered by FITCH and contributed a new subscriber

base.

The new shortened name of FITCH was chosen

to reflect the integration of the agency’s new

members into a single world class group.

Robin MONRO-DAVIESChief Executive Officer

2000 REVENUES:

BY GEOGRAPHIC AREA

(EUR millions) 2000 1999 1998

Consolidated revenues 241.4 158.5 140.5International revenues, as % of total 97.9% 97.6% 98.5%

Operating income (EBIT) 39.7 29.9 26.4Operating income, as % of total revenues 16.4% 18.9% 18.8%

Employees at December 31 1,166 749 700Employees outside France, as % of total 97.9% 97.5% 97.7%

France andcontinental Europe

14%

Other countries

9%

USA

71%

United Kingdom

6%

Corporates

14%

Financial institutions

17%

Asset-backed securities

51%

Sovereigns/publicfinance

9%

Database and research

9%

2000 REVENUES:

BY BUSINESS SEGMENT

19A n n u a l R e p o r t 2 0 0 0

BUSINESS REVIEW

Following the successive mergers, task forces

were set up to deal with the various aspects

of the newly-acquired companies' integration.

The first task was a comprehensive review of

all of the ratings systems and criteria as well

as all existing ratings of issuers and issues

as a prelude to combining them. Teams were

also reorganized, primarily in the USA.

Both DUF F & PH E LPS and BA N KWATCH

contributed numerous international branches,

subsidiaries and joint ventures to the group.

One of the major projects of 2000 was therefore

to consolidate and reposition the agency in

Latin America and Asia, an essential task

which is on the point of completion. FITCH also

focused on communicating its new group

structure to major investors and issuers, as well

as to all of its clients.

Capital markets remained active during the

year. Bond issues increased sharply in Europe,

although growth in US issues slowed. European

consumer and commercial secur izat ion

expanded significantly and the same applied

to US asset-backed commercial paper issues.

In both Europe and the United States, the

number of asset-backed collateralized bond

obligation (“CBO”) and collateralized loan

obligation (“CLO”) issues was higher than the

previous year.

Organic growth and last year's mergers

strengthened FITCH's market positions in the

highly profitable commercial mortgage-backed

securities and residential mortgage-backed

securities ratings sectors, despite a reduction

in transaction volumes.

In the bank rating sector, which remains one

of FITCH’s core businesses, the rating portfolio

expanded very significantly during the year,

helped by BANKWATCH’s much broader

coverage in the United States and Asia.

FITCH’s increased analytical capabilities will

provide even better quality research in the

highly strategic country risks rating sector.

Government debt issues declined for the

second year running in the United States but

FITCH's revenues in this sector held firm thanks

to the contribution of new clients and a modest

gain in market share.

20 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

In the Corporates segment, revenues more than

doubled in 2000. The contribution of DUFF &

PHELPS’ substantial client base, combined

with new ratings requests from both European

and US companies has enabled FITCH to build

a benchmark portfolio. FITCH improved its

coverage of public high yield and investment

grade securities issues, as well as private

placements the USA, Europe and Latin America.

Corporate ratings remain a key growth

opportunity for the agency.

INTERNET

During 2000, FITCH built « FITCHRESEARCH »

a new subscription based Internet platform that

provides customized access to all of FITCH's

global credit ratings and research. The site

contains FITCH’s ratings database, industry

research and a transaction monitoring function,

providing a one-stop information source for

FITCH IBCA, DUFF & PHELPS and BANKWATCH

data. « FITCHRESEARCH » was launched in

January 2000 and is intended to be the primary

subscription offering for the firm.

www.

fitch

ratin

gs.co

m

Analysts meeting in New York.

21A n n u a l R e p o r t 2 0 0 0

RESULTS

FITCH performed extremely well in 2000 with

revenue of more than € 241 million and EBITDA

representing over 26% of revenue. DUFF &

PHELPS contributed to revenues and earnings

only in the last 8 months of 2000 and

BANKWATCH will be consolidated for the first

time in 2001. Organic growth was strongest

in Europe at over 20%, versus 8% to 10%

in the USA due to lower market volumes.

The group was able to keep merger-related

costs to a strict minimum and rationalization

measures were launched following the mergers,

mainly in the USA. Both employee numbers

and costs continued to increase in Europe,

where the group has had to make essential

investments to sustain the rapid pace of growth

which is expected to continue into 2001.

Operating income totaled € 39.7 million versus

€ 29.9 million in 1999, representing an increase

of almost 33%.

OUTLOOK

Revenues are projected to grow at an extremely

healthy rate in 2001, boosted by the full-

year contribution of the recently-acquired

businesses, combined with significant

commercial development efforts and market

share gains. A major marketing campaign has

been launched to present the agency’s new

positioning and highlight its key strengths.

Thanks to its critical mass and high visibility,

FITCH should move up a gear in its organic

growth in 2001, by leveraging its expanded

industry coverage and its substantial presence

in Europe.

Stephen W. Joynt

President

Chief Operating Officer

22 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

5 ter, rue du Dôme

75016 Paris

FRANCE


As part of its pro-active strategy, in 2000

LBC consolidated and developed its existing pos-

itions at high growth potential sites, raising bulk

storage capacity to above the 2 million cu. meters

mark. The main highlight of the year was the

acquisition of a 135,000 cu.meter terminal in

Houston from CELANESE.

The company focused its development effort

on Antwerp, Rotterdam and Houston, which repre-

sent the heartlands of the chemical industry

(Houston for example accounts for 45% of

chemical production in the USA). This industrial

environment, in which the full range of basic,

intermediate and specialist chemicals are manu-

factured, creates ideal conditions for market

growth.

In response to customer needs and to keep

pace with their development, total storage capacity

at the Antwerp, Rotterdam and Houston com-

plexes has been increased by 60,000 cu.meters.

In addition, the terminal acquired from CELANESE

brings the total storage capacity at Houston to

over 500,000 cu.meters, making LBC one of the

largest chemical storage operators in the area.

Michel DAVALChairman and


2000 SALES:

BY GEOGRAPHIC AREA

(EUR millions) 2000 1999 1998

Consolidated sales 114.8 93.1 66.2International sales, as % of total 68.8% 60.4% 44.4%

Operating income (EBIT)* 28.0 22.5 15.1Operating income, as % of total sales 24.4% 24.2% 22.8%

Employees at December 31 642 591 501Employees outside France, as % of total 53.6% 52.1% 43.3%


Spain andPortugal

6.5%

France

31.2%

United States

33.3%

Belgium andNetherlands

29.0%

23A n n u a l R e p o r t 2 0 0 0

BUSINESS REVIEW

The chemical industry enjoyed strong growth

throughout the year, with production volumes

up by more than 4% in Europe and almost 5%

in the USA.

These favorable market conditions helped

to drive a 12% increase in all product volumes

at the LBC group's terminals, including 21%

growth in chemicals volumes.

However, the picture was mixed – terminals’

volumes in France remained flat or even

declined compared with 1999, whereas

satisfactory growth was reported in the Iberian

peninsula, particularly at the rapidly expanding

Cartagena terminal. The three major chemical

terminals at Antwerp, Rotterdam and Houston

experienced a significant increase in volumes.

LBC’s subsidiaries outside France, which

represent 60% of its storage capacity,

accounted for 2/3 of the group’s throughput

volumes in 2000.

Although capacity utilization in general was

lower than in 1999, it remained high at an

average of 86% and in certain cases was close

to saturation.

The Houston terminal.

The Antwerp terminal.

RESULTS

Sales rose by 23% to € 114.8 million, an

increase which was primarily attributable to

the first full year contribution of the DUTCH

subsidiary in Rotterdam compared to seven

months in 1999, and the consolidation of LBC

PETROUNITED’s acquisition from July 1, 2000.

Based on a comparable structure, year-on-year

growth stood at 4.5%, almost identical to that

achieved in 1999.

The expansion in international sales reflects

the group’s steady development outside France.

International operations accounted for 69% of

sales in 2000, up from 60% in 1999 and 44%

in 1998.

Operating income rose 24% to € 28 million,

again reflecting the significant contribution

made by the group’s international subsidiaries.

24 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

INTERNET

LBC has recently launched a major project

aimed at providing its customers with a wide

range of on-line information through the

creation of an Intranet/Extranet web site:

www.lbc.online.com.

The site will provide general information on the

products stored by LBC, including product type,

storage conditions, means of transport etc.

Each customer will also be able to access

information concerning its own products stored

at LBC terminals and track recent movements.

Marseille terminal.

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OUTLOOK

Despite the expected slow-down in the United

States economy, current forecasts point to

another year of growth for the chemical

industry, although at a more modest rate than

in 2000 with production expected to increase

by 3 - 3.5%.

LBC’s key objectives for 2001 will be to continue

to consolidate its three major complexes at

Antwerp, Rotterdam and Houston as well as to

improve logistics at the terminal in Louisiana,

USA, an area which is home to the second

largest industrial complex in the Gulf of Mexico.

At the same time LBC will seek to step up

momentum at the French terminals where new

throughput is forecast in 2001. The group also

has plans to build 60,000 cu. meters of new

storage capacity. Unloading and loading a ship at the Antwerp terminal.

26

BU S I N E S S E S

A n n u a l R e p o r t 2 0 0 0

21, quai Alphonse-Le Gallo

92100 Boulogne-Billancourt

FRANCE

Bernard PIERREChairman


2000 was a watershed year for SECAP TECH-

NOLOGIES.

The company demonstrated its commitment

to innovation by launching franking products and

systems incorporating web-based technologies.

The company also changed its name to SECAP

TECHNOLOGIES, in order to present an image in

keeping with its potential in this area.

Major changes in group structure also took

place during the year, with the sale of the ANFA

office supplies business and the extension of

SECAP TECHNOLOGIES’ geographic reach through

the acquisition of two new subsidiaries – ASI

which has now become its UK marketing subsid-

iary, and DATATECH, an addressing specialist in

the United States.

In France, strong initial sales of a new range

of franking machines is expected to lead to signif-

icant market share gains.

SECAP TECHNOLOGIES also kept up its R&D

efforts during 2000, introducing a networked

franking machine system (e.sara) and two innov-

ative new folder-inserters (SI 5000 and SI 10000).

Thus SECAP TECHNOLOGIES expanded its

Mail Processing sales, while keeping income at

a satisfactory level.

2000 SALES (EXCLUDING ANFA):

BY BUSINESS SEGMENT

(EUR millions) 2000 1999 1998

Consolidated sales 92.5 - 82.5 79.6International sales, as % of total 13.2% 7.7% 7.2%

Own work capitalized 6.0 4.5 6.4

Operating income (EBIT)* 16.2 - 15.9 16.7Operating income, 17.5% 19.6% 21.0%as % of total sales + own work capitalized

Employees at December 31 670 817 756

The figures above have been restated for all three years to exclude ANFA which wassold in July 2000.* Net of employee profit-sharing (new French accounting standards).

Franking systemleasing and maintenance

58.8%

Sale and leasing of mail processing

equipment

34.6%

Sales of office supplies

6.6%

Yves COUÉVice-President and


KEY FIGURES (EXCLUDING ANFA) :

27A n n u a l R e p o r t 2 0 0 0

◆ Sales of office supplies

Direct sales of office supplies held firm in 2000

compared to 1999 at a total of € 6.1 million.

This amount mainly concerns sales of supplies

to franking machine leasing clients as ANFA was

sold during the year.

◆ Sale and leasing of mail

processing equipment

The office equipment business reported

significant growth in folder-inserter and

franking peripheral sales and leasing in 2000.

Both the French and international sales teams

were further expanded during the year, mainly

following the acquisitions referred to above

of ASI and DATATECH - two major distributors

which are now SECAP subsidiaries. Sales of

weighing tray peripherals for the new range

of franking machines also remained strong.

Against this favorable backdrop, sales rose to

€ 26.2 million, up 13% on 1999.

BUSINESS REVIEW

◆ Franking system leasing and maintenance

A concerted sales drive resulted in the

signature of more than 6,350 new leasing

contracts and the conversion of over 11,500

existing contracts. The installed base expanded

by approximately 1,000 units during 2000 to

reach 90,700 systems.

Billing revenues from leased equipment and

related services climbed 5.7% on the year

earlier period to € 54.3 million. The contribution

of this core business to SECAP TECHNOLOGIE’s

consolidated sales (excluding ANFA) stood

at 58.8%.

SI 10000, the first

multi-format folder-inserter.

Advertising slogans

for ink-jet printing

franking machines.

◆ International sales

and marketing subsidiaries

The UK subsidiary, ASI was consolidated from

July 2000 and the North American subsidiary,

DATATECH, from September 2000.

Along with SECAP POSTHANTERING AB in

Sweden, these three international subsidiaries

contributed sales of € 7.3 million in 2000

and made a slight positive contribution to

consolidated net income.

◆ Engineering and manufacturing

Total sales amounted to € 21.6 million

compared with € 20.7 million in 1999. Part

of this amount represents inter-division sales

and is eliminated in consolidation.

INTERNET

Web-based technology is at the heart of SECAP

TECHNOLOGIES' new generation franking

machines, which have now become digital

communication terminals using the TCP/IP

protocol. This development enabled the group to

launch its new service, e-sara which uses

Internet protocols to electronically monitor the

use of franking machines. This system allows

customers to monitor postal expenditure more

efficiently and in the long term to optimize

costs. SECAP TECHNOLOGIES has also signed

a partnership agreement with HEWLETT-

PACKARD, the world’s leading ink jet printer

specialist, gaining the possibility to offer

additional services to customers.

SECAP TECHNOLOGIES’ new DP series franking

machines also have a digital printing function

which provides additional benefits in terms of

printing quality and operating flexibility.

RESULTS

Excluding ANFA, operating revenues rose by

almost 13.4% to € 100.1 million, from € 88.4

million in 1999. On a constant group structure

basis (excluding the international subsidiaries)

the increase was 7.5%. Sales in 2000 totaled

€ 92.5 million, compared with € 82.5 million

for the year-earlier period.

Operating income (excluding ANFA) also

increased to stand at € 16.2 million, versus

€ 15.9 million in 1999. Income growth was

restrained by additional selling expenses

caused by the group’s rapid expansion.

OUTLOOK

SECAP TECHNOLOGIES’ intends to keep up its

drive to:

◆ accelerate production and marketing of the

28 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

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29A n n u a l R e p o r t 2 0 0 0

new range of franking machines,

◆ convert the group's installed base and

complete the necessary modifications for

the introduction of the euro,

◆ achieve sustained growth of the folder-

inserter business in France,

◆ build exports through the subsidiaries

acquired in 2000.

Given the first two objectives, capital

expenditure on franking machines is expected

to rise substantially in 2001, which will in turn

lead to an increase in own work capitalized.

Billing revenues from services is expected to

rise at the same rate as in 2000.

SECAP TECHNOLOGIES should therefore enjoy

significant sales and earnings growth in 2001.

30 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

Via Busnelli 1

I - 20036 Meda MI

ITALY

PRESENTATION OF THE COMPANY

From its domestic base in Italy, the worldwide

leader in designer furniture, CASSINA, enjoys an

unrivaled position as a benchmark in contempora-

ry design.

As a designer and manufacturer, CASSINA

owes its international renown of its prestigious

"Cassina I Maestri" and "Cassina Contemporanei"

collections, which feature the latest work of

illustrious names such as Philippe Starck, Piero

Lissoni and Hannes Wettstein, their creation still

form the corner stone of the collections. In recent

years, the company has diversified by building a

lighting fixtures business around the Italian

manufacturer, "Nemo", which was further devel-

oped in 1998 with the acquisition of ITALIANA

LUCE. CASSINA has also created a "Contract" unit

which provides interior design services for luxury

hotels and branded retail chains.

CASSINA has an extensive presence on

international markets where its collections are

marketed by a network of carefully selected

specialty retailers and franchise holders as well

as through its renowned showrooms in Milan,

Paris, Tokyo and New York.

CASSINA’s business development strategy

seeks to achieve increased market share and

expand the company’s retail base.

Sandro MAGGINIChief Executive Officer

(EUR millions) 2000 1999 1998

Consolidated sales 101.2 90.1 76.2International sales, as % of total 91.4% 91.0 % 90.0%

Operating income (EBIT) 13.1 11.3 8.2Operating income, as % of total sales 12.9% 12.5 % 10.8%

Employees at December 31 438 446 411Employees outside France, 98.4% 98.4 % 98.3%as % of total

2000 SALES:

BY GEOGRAPHIC AREA

Furniture

75.4%

Lighting fixtures

14.0%

Other

10.6%

BY BUSINESS SEGMENT

Italy

19.4%

Rest of Europe

51.2%

Asia

6.1%

Rest of world

2.7%

Americas

20.6%

31A n n u a l R e p o r t 2 0 0 0


In 2000, CASSINA showcased a wide range of

new products at trade fairs, including the Cologne

fair in January and the Milan fair in April. The new

collection by the Swiss designer Hannes Wett-

stein for example comprises models that make a

contemporary statement in the home with its Globe

sofas, Mir tables, the Ariane small appealing armchair

and Lem and Items complementary furnitures.

The six models in the collection designed by

recently-acquired PRICA were included in CASSINA's

2000 catalogue and presented to customers.

These models were greeted with immediate success.

The lighting fixtures division also continued to

innovate, presenting new products at the Frankfurt

and Milan trade fairs, including Draco, Corona and

the "Bridge" system.

The "Contract" division signed up new custo-

mers including "Frette", the Italian manufacturer

of luxury furnishing fabrics, and also struck up

new contacts with DUNHILL and LACROIX.

BUSINESS REVIEW

Consolidated sales climbed by almost 13%

in 2000 to € 101.2 million, from € 90.1 million

in 1999, with sales outside France representing

91.4% of the total.

CASSINA further expanded its international

presence and now operates in 50 countries.

Sales in the Americas, and especially the USA,

grew significantly in 2000 and represented

20.6% of consolidated sales, compared with

16.5% in 1999. The same pattern was repeated

in Asia.

Sales growth was once again achieved without

any increase in the number of employees,

thanks to further productivity gains.

Hannes Wettstein’s M.I.R table

and Ariane chairs.

BRIDGE fluorescent lighting.

RESULTS

Operating income reached € 13.1 million, an

increase of 16% on the € 11.3 million reported

in 1999. This increase came on the back of

growth of over 37% in 1999.

All of CASSINA’s businesses made increased

contributions to net income.

OUTLOOK

Despite the international economic slowdown

and a probable increase in raw materials prices,

the outlook for CASSINA in 2001 appears

favorable.

The group should increase its market share,

boosted by its extended structure. In line

with this business objective, in March 2001,

CASSINA acquired MELTIMI, a specialist high

quality lighting company and ALIAS, a designer

furniture company.

32 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

In line with its objective of constantly

enhancing its brand image, CASSINA organized

a number of cultural and promotional events

during 2000 and actively continued its battle

against counterfeit goods.

INTERNET

The CASSINA group companies have impl-

emented several web-based initiatives in order

to promote the high quality design of their

products and to reinforce and extend their

relations with their customers.

The CASSINA web site provides a full insight

into the company’s products, style and designers.

NEMO and ALIAS also provide catalogues on

their web sites and offer certain e-commerce

applications.

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na.it

DODO armchair

by Toshiyuki Kita.

GLOBE sofa, ITEMS shelves

and LEM table by Hannes Wettstien.

A n n u a l R e p o r t 2 0 0 0 33


2000 was a year of sustained growth in sales

of "other products", essentially for customers in

the electronics industry with products such as

rolled nickel, copper nickel and Niclafor lamina-

ted strips. The company won significant contracts

in the United States and South Korea in 2000,

lifting "other products" sales by 58.5%.

Total sales of CLAL-MSX’s two main product

families – laminates and wiredrawn products –

climbed by 20.7% compared with 1999.

BUSINESS REVIEW

CLAL-MSX sales grew significantly in 2000,

reflecting buoyant conditions in its customer's

markets and a steady flow of orders for euro

coin blanks.

The highest growth in 2000 was achieved by the

electronics applications sector, particularly in

thin and ultra-thin nickel strips for connectors,

the rechargeable batteries sector and the

eyeglass sector, especially in the Far East.

11, rue du Ménillet

60540 Bornel

FRANCE

Dan WEBERChairman and


2000 SALES:

BY BUSINESS SEGMENT

(EUR millions) 2000 1999 1998

Consolidated sales 62.8 49.9 49.2International sales, as % of total 58.9% 41.5% 49.0%

Sales excluding metals 35.2 33.2 34.3

Operating income (EBIT)* 3.7 5.5 3.7Operating income, as % of 10.5% 16.5% 10.8%total sales excluding metals

Employees at December 31 223 199 196


Other

9%

Laminated products

44%

Wiredrawn products

23%

Coin blanks

24%

ARCAP precision micromechanical parts.

34 A n n u a l R e p o r t 2 0 0 0

BU S I N E S S E S

including Italy, Hong Kong and China.

Demand remained buoyant in the other

industrial sectors served by the company

(chemicals, petrochemicals, jewelry, precision

mechanics).

The company’s sustained sales drive and its

expanded presence in the United States and the

Far East, lifted exports to 60% of consolidated

sales.

CLAL-MSX has also developed a web-site for its

customers as a further promotional tool for its

products. The site presents all of the company's

products, their physical characteristics,

their forms available and their industrial

applications. Customers are able to request

information on the site and obtain the address

of CLAL-MSX correspondents throughout the

world.

RESULTS

Sales rose to € 62.8 million in 2000, up 25.9%

on the previous year. However, part of this

increase was attributable to higher average

metal prices. At € 35.2 million, sales excluding

metals were up 6% on 1999.

Special materials such as nickel, cupro-nickel

alloys with controlled electric conductivity and

special nickel-silvers used in the electronics

and mobile telephony industries were key

growth drivers in 2000, particularly in the

United States and the Far East, with demand

remaining high throughout the year.

Lackluster conditions in the eyeglass sector

continued during the first quarter of 2000 on

the back of the flat demand observed at the end

of 1999. However, from May 2000 onwards

demand picked up significantly, reaching a

peak at the end of the year. This trend was

reflected in all of the company’s markets,

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Production of wire for the eyewear industry.

35A n n u a l R e p o r t 2 0 0 0

Operating income contracted to € 3.7 million

from € 5.5 million in 1999, essentially due to

the fact that at the end of 2000, metal prices

had fallen back to their level at the beginning

of the year or lower, whereas in 1999 the value

of metal inventories increased significantly.

OUTLOOK

It is difficult to forecast developments in the

diversified markets served by CLAL-MSX’s

specialist products beyond the first half of

2001. However, the company’s order book in the

first quarter was very satisfactory comparable

to that for the final months of 2000.

Demand for coin blanks should remain strong

throughout the year, as 2001 is the final year for

euro coin issuing programs.

Special alloys used for connectors.

37A n n u a l R e p o r t 2 0 0 0

Financialreport

CONTENTS

Directors’ report

Consolidated financial statements

Company financial statements

38

53

81

38 A n n u a l R e p o r t 2 0 0 0

DI R E C T O R S ’ R E P O RT

SIGNIFICANT EVENTS

OF 2000

FIMALAC is now focusing its growth and interna-

tional development on two core businesses:

• The rating business, spearheaded by FITCH which

is the world's third largest rating agency. The

highlights of 2000 for FITCH were the acquisitions of

DUFF & PHELPS and BANKWATCH which have significantly

reinforced its market position.

• The tools business, organized around FACOM

which is one of the world's leading players in this

market. FACOM turned in an excellent performance

in 2000 in terms of both sales and earnings

growth.

FITCH and FACOM together accounted for 65% of

Group sales and nearly 70% of operating income

in 2000.

The Group's other three market-leading

businesses also contributed to last year's sales

and earnings growth. LBC is the world no. 2

in chemicals storage, SECAP TECHNOLOGIES is a

European leader in franking and mail processing

systems, and CASSINA is the worldwide leader in top

of the range designer furniture.

During the year, FIMALAC continued to withdraw

from non-strategic activities, by divesting ANFA and

CLESTRA and winding down its interest in ENGELHARD-

CLAL. Following its step-by-step transformation,

FIMALAC is now a diversified business support

services group, controlling all strategic subsidaries,

most often with a 100% interest.

Acquisition of DUFF & PHELPS and BANKWATCH:

FITCH becomes a world leader in the rating

market

The newly renamed FITCH, FIMALAC’s specialist

rating subsidiary, completed two major acquisitions

in 2000:

• In April 2000, following a friendly takeover bid, it

acquired the entire capital of New York listed DUFF

& PHELPS, the world’s fourth largest rating agency.

• In October 2000, FITCH acquired the entire capital

of BANKWATCH, which specializes in bank ratings.

In connection with its contribution, BANKWATCH’s

former shareholder, THOMSON FINANCIAL, acquired

a 3.4% minority interest in FITCH. The resulting

dilution gain of € 25 million (FRF 164 million) is

included in the consolidated income statement

under non-recurring income.

FITCH is now a foremost player in the rapidly

expanding rating market. These two acquisitions,

which mark the final stage in the reorganization of

the global rating industry, have firmly anchored

FITCH among the world’s top three agencies,

with very strong positions in several segments,

including asset-backed securities, bank and

insurance ratings.

Consolidation of the Group’s Internet

presence

Building a presence on the Internet has been a key

priority for Group companies for several years

now, and several new initiatives were launched

in 2000. FITCH launched « FitchResearch.com »,

an online subscriber service of unrivalled quality,

39A n n u a l R e p o r t 2 0 0 0

providing access to research and surveillance

data for asset-backed securities portfolios. In

November 2000, FACOM acquired a 10% interest

in « leclubauto.com », a portal offering services

to automotive repair centers, alongside VALEO and

3M. FACOM catalogues will also soon be available

on the Internet.

FIMALAC also made selective investments in B-to-B

specialists in 2000 as well as in companies

supplying goods and services to Internet providers.

The Group holds approximately 7% of the capital

of TEAM PARTNERS GROUP, a software engineering

house which specializes in supplying services to

companies seeking to become part of the new

economy, as well as 14% of CASHWARE, a developer

of secure Internet payment systems. FIMALAC also

has an interest in two specialized funds, CARLYLE

INTERNET EUROPE and FRANCISCO PARTNERS.

As from 2001, the Group will have its own web

agency, FIMALAC INTERACTIVE, dedicated to assisting

Group companies with their web-based initiatives.

It will be the Group technological and research

center or expertise for e-business issues and the

key vehicle for investments in Internet companies.

These investments will focus on companies whose

activities relate to the Group’s businesses and

which offer strong potential for value creation.

Disposal of non-strategic businesses:

divestment of CLESTRA and ANFA and

progressive withdrawal from ENGELHARD-CLAL

a) Divestment of CLESTRA:

CLESTRA, a manufacturer of partitions and counter-

ceilings, was sold in May 2000. This sale had

no impact on consolidated income for 2000.

b) Divestment of ANFA:

In July 2000, ANFA, the SECAP subgroup’s office

supplies subsidiary, was sold to Netherlands-

based BUHRMANN, the world leader in this sector.

ANFA’s business was largely confined to the

domestic market - mainly in the Paris area - and it

was relatively small, making it difficult for the

company to compete against the major office

supplies groups operating in the world market.

FIMALAC’s strategy consists of taking national

players of a certain size and building them into

global leaders. ANFA did not fit this profile and it

was therefore decided to dispose of the business.

The transaction was carried out on excellent

terms, raising € 50.6 million (FRF 332 million)

before tax and generating an after-tax gain of

€ 29.4 million (FRF 193 million).

c) Progressive withdrawal from ENGELHARD-CLAL:

As previously announced, FIMALAC also began to

withdraw from its non-strategic precious metals

processing business. ENGELHARD-CLAL’s Jewelry

business was sold in September 2000 to the UK

Group COOKSON and the Electrical Contacts business

was sold in early 2001 to US-based TECHNITROL.

These businesses represented 45% of ENGELHARD-

CLAL’s sales in 2000 and negotiations are underway

with potential buyers of the other businesses.

Following the reduction in FIMALAC's interest to 49%,

ENGELHARD-CLAL was accounted for by the equity

method as from January 1, 2000 whereas in

previous years it was proportionally consolidated.

40 A n n u a l R e p o r t 2 0 0 0


Consequently, the Group's share in its net income

is shown on a separate line of the consolidated

income statement.

ACTIVITY OF THE MAIN

SUBSIDIARIES

FACOM

FIMALAC owns the entire capital of FACOM since the

successful June 1999 public tender offer for its

parent company STRAFOR FACOM (renamed FIMALAC

INVESTISSEMENTS), and the public buyback offer

made in the first half of 2000.

Hand tools, FACOM’s key business, accounted for

approximately 77% of its total sales in 2000.

In 2000, hand tool sales totalled € 483.8 million

(FRF 3,174 million), up almost 5% on the previous

year. Operating income surged 17% to € 63.7

million (FRF 418 million).

These increases were primarily attributable to

robust sales by the FACOM, VIRAX, BOST and PAROLAI

brands in the buoyant French market. Business in

the rest of Europe was generally brisk, although

market conditions were less favorable in Germany

and the United Kingdom than in other countries.

The process of product renewal was also kept up in

2000, with the successful launch of more efficient

and ergonomic ranges of pliers and screwdrivers.

Garage equipment accounted for approximately

23% of FACOM’s total sales in 2000. In 2000, garage

equipment sales surged by 50% to € 147.8 million

(FRF 969 million), generating operating income of


Significant momentum was provided by the

acquisition of three companies specialized in

vehicle hoist systems – FOG in France, TECALEMIT

in the United Kingdom and ZIPPO in Germany.

These three companies have been consolidated

since January 1, 2000 by BEISSBARTH AUTOMOTIVE

GROUP, which spearheads the garage equipment

business. The strong growth in sales led to market

share gains and also strengthened FACOM’s

position with key customers, including European

automakers, vehicle inspection networks and

fast-fit installer networks.

The FACOM group reported total sales of € 631.6

million (FRF 4,143 million) in 2000, an increase

of nearly 13% on 1999. Operating income growth

was robust up by almost 15% to € 69.8 million

(FRF 458 million).

FITCH

As previously mentioned, 2000 was a most

important watershed year for FITCH due to the

acquisition of DUFF & PHELPS and BANKWATCH.

FITCH performed extremely well in 2000, with

revenue of more than € 241 million (FRF 1,583

million) and EBITDA representing over 26% of

revenue. DUFF & PHELPS contributed to revenues and

earnings only in the last 8 months of 2000 and

BANKWATCH will be consolidated for the first time

in 2001. After a year of transition in 2000, the full

41A n n u a l R e p o r t 2 0 0 0

benefit of the acquisitions will be felt in 2001, with

DUFF & PHELPS and BANKWATCH both contributing to

revenues and earnings over the entire twelve-month

period.

LBC

The main highlight of 2000 was the acquisition of

the CELANESE storage terminal by LBC’s American

subsidiary PETROUNITED at the end of the first half.

With a storage capacity of over 800,000 cu. meters

including 500,000 cu. meters in Houston, LBC’s

PETROUNITED is now a significant player in the

United States. Including capacity created by

organic growth operations carried out in previous

years, LBC’s storage capacity now totals

2.1 million cu. meters.

LBC performed well in 2000, achieving results

fully in line with budget objectives. Revenues

expanded by 23% to € 114.7 million (FRF 753 million)

and operating income rose by almost 24% to

€ 28 million (FRF 184 million).

SECAP TECHNOLOGIES

SECAP entered the international market in late 1999

with the acquisition of SECAP POSTHANTERING AB

in Sweden and in 2000, the newly named

SECAP TECHNOLOGIES stepped up its international

expansion by acquiring ASI, which has now

become its UK marketing subsidiary. At the end

of the year, the company also acquired DATATECH,

an addressing specialist in the United States.

The company reaffirmed its commitment to

innovation by launching franking products and

systems incorporating web-based technologies.

The company also changed its name to « SECAP

TECHNOLOGIES » in order to present an image in

keeping with its potential in this area.

Franking machine leasing revenues and sales

increased in 2000 and office equipment sales were

also up on the previous year. SECAP TECHNOLOGIES

ended the year with sales of € 92.5 million

(FRF 607 million). Margins remained strong, as

evidenced by the company’s operating income of

€ 16.2 million (FRF 106 million). These figures do

not include ANFA, which was sold in July 2000,

generating a significant profit.

CASSINA

2000 was an excellent year for CASSINA’s two core

businesses, furniture and lighting fixtures,

reflecting the brand's increasingly high profile.

Sales came to € 101.2 million (FRF 664 million)

and operating income reached € 13.1 million

(FRF 86 million), an increase of almost 16% on the

previous year.

2000 was also a year of remarkably strong

international growth for CASSINA. The company now

operates in 50 countries and has a very active

international expansion policy. In March 2001,

CASSINA announced the acquisition of MELTIMI,

an Italian company specializing in high quality

lighting, and ALIAS, an Italian designer furniture

company. These two acquisitions form part of the

active development strategy being conducted by

CASSINA with FIMALAC's impulse.

42 A n n u a l R e p o r t 2 0 0 0


CONSOLIDATED ACCOUNTS

There are two significant changes in the

presentation of the consolidated income stat-

ement for 2000 compared with the previous year:

• Employee profit sharing is included in operating

income, under personnel costs, in accordance with

the new French accounting standards applicable

as from January 1, 2000. To permit meaningful

comparisons, figures for 1999 have been adjusted

to reflect the new standards.

• ENGELHARD-CLAL is now 49%-owned and is

presented separately in the consolidated

accounts for 2000. The company was previously

proportionally consolidated.

The following table shows the key figures for

2000. All amounts are stated net of minority

interests:

Operating income € 74.6m + 30.4%after interest and tax FRF 489m(net of employee profit-sharing)

Net income before € 108.5m + 52.2%amortization of goodwill FRF 712m

Net income € 100m + 40.1%FRF 656m

Consolidated sales

Consolidated sales for 2000 totaled € 1,336.4

million (FRF 8,766 million). These figures are not

comparable with 1999 published sales, due to the

major changes in Group structure which took

place in 2000.

CLESTRA and ANFA were both deconsolidated

TREASURY STOCK

12.1% of the capital of FIMALAC & CIE

MINERAIS & ENGRAIS, a wholly-owned subsidiary of

FIMALAC S.A., owns 12.1% of the capital of FIMALAC & CIE.

FIMALAC & CIE ended 2000 with an operating loss of

€ 0.7 million (FRF 4.3 million). Net interest income

for the year came to € 7.5 million (FRF 49 million),

including interest expense of € 7.5 million (FRF 49

million) and interest income of € 15 million (FRF 99

million). Interest income consisted primarily of

€ 11.7 million (FRF 77 million) worth of dividends

received from FIMALAC S.A. Including non-recurring

items, FIMALAC & CIE's net income amounted to

€ 6 million (FRF 40 million), compared with € 5.9

million (FRF 39 million) in 1999.

Treasury stock held by FIMALAC S.A.

A share buyback program was launched in November

1998. Details of the program are given in an

information memorandum produced in accordance with

French Stock Exchange authorities (COB) rule 98-02,

which was approved by the COB under no. 98-875.

Shares bought back under this program and held

as treasury stock by FIMALAC S.A. at December 31,

2000 represented 8.04% of the Company’s capital.

The shares had a book value of € 51.3 million (FRF

337 million). The total includes 132,249 shares €

representing 0.42% of the capital — which are being

held for allocation on exercise of management

stock options granted in December 1998 and May

1999. These shares are carried in the balance sheet

under « Marketable securities ».

43A n n u a l R e p o r t 2 0 0 0

following their sale in May 2000 and July 2000

respectively. In addition, as mentioned above,

FIMALAC’s strategy of a step-by-step withdrawal

from ENGELHARD-CLAL’s businesses reduced the

Group’s interest in this company to 49%.

ENGELHARD-CLAL was therefore accounted for by

the equity method in 2000 whereas in prior years

it was proportionally consolidated.

FACOM and CASSINA have both been consolidated

since July 1, 1999. DUFF & PHELPS contributed to

FITCH’s revenues and earnings for the last 8 months

of 2000 and BANKWATCH will be consolidated for the

first time in 2001.

Consolidated sales break down as follows:

(EUR millions) 2000 1999

FACOM (6 months in 1999) 631.4 284.1

FITCH (including 8 months’ 241.4 158.5contribution from D&P in 2000)

LBC 114.8 93.1

SECAP TECHNOLOGIES 92.5 81.2

CASSINA (6 months in 1999) 101.2 46.5

Other (*) 155.1 186.9

Consolidated sales 1,336.4 850.3excluding ENGELHARD-CLAL

ENGELHARD-CLAL - 729.3

Published sales 1,336.4 1,579.6

ENGELHARD-CLAL - (729.3)

Discontinued operations (71.0) (110.1)(ANFA and CLESTRA)

Other changes in Group structure (443.0) -

Sales on a constant Group structure basis 822.4 740.2

+ 11.1% on a constant Group structure basis

(*)CLESTRA (5 months’ contribution in 2000), ANFA (6 months’

contribution in 2000), CLAL-MSX, parent companies.

As shown above, on a constant Group structure

basis 2000 sales were up 11.1% on 1999. This

healthy increase reflects the sustained growth

of the Group’s key subsidiaries, FITCH and FACOM,

as well as FIMALAC’s policy of withdrawal from non-

strategic businesses. In 2000, international sales

accounted for 65% of total consolidated sales,

illustrating the Group's predominant focus on

markets outside France. Sales in the United States

now represent 22% of total consolidated sales.

Consolidated operating income

Consolidated operating income surged 57.1% in

2000 to € 157,3 million (FRF 1,032 million):


FACOM 69.8 32.9

FITCH 39.7 29.9

LBC 28.0 22.5

SECAP TECHNOLOGIES 16.2 15.9

CASSINA 13.1 5.1

ENGELHARD-CLAL - 2.5

Other (*) (9.5) (8.7)

Consolidated operating 157.3 100.1 + 57.1%income(**)

(*) CLESTRA (5 months’ contribution in 2000), ANFA (6 months’

contribution in 2000), CLAL-MSX, parent companies.

(**) Net of employee profit sharing (2000 and 1999).

During 2000, the Group announced that its

objective was to achieve operating income of

more than FRF 1 billion. At that time, forecasts

still included ENGELHARD-CLAL by the proportional

method and were based on operating income

before employee-profit sharing which was

included below the line. As shown above, the

44 A n n u a l R e p o r t 2 0 0 0


Consolidated net income — after minority

interests


Operating income after interest, 74.6 57.2tax and minority interests

Non-recurring income 33.9 14.1(after tax and minority interests)

Consolidated net income 108.5 71.3 + 52.2%before amortization of goodwillafter minority interests

Amortization of goodwill (8.5) 0.1

Consolidated net income 100.0 71.4 + 40.1%after minority interests

Consolidated net income before amortization of

goodwill totalled € 108.5 million (FRF 712 million),

an increase of 52.2% over 1999 net income of


Net income after amortization of goodwill

amounted to € 100 million (FRF 656 million), a

climb of 40.1% over the 1999 figure of € 71.4


Net income was boosted by substantial non-

recurring profits:

• The sale of ANFA for € 50.6 million (FRF 332

million) generated an after-tax gain of € 29.4


• The contribution of BANKWATCH to FITCH led to a

dilution gain of € 25 million (FRF 164 million).

Group far exceeded this objective in 2000, despite

the deduction of employee profit sharing from

operating income and the deconsolidation of

ENGELHARD-CLAL.

Operating income after interest,

tax and minority interests

Despite the increase in interest expense due to

the acquisitions of FACOM in 1999 and DUFF & PHELPS

in 2000, operating income after interest, tax and

minority interests, net of employee profit-sharing

amounted to € 74.6 million (FRF 489 million), up

30.4% on 1999.


Operating income (*) 157.3 100.1

Net interest expense (67.4) (0.5)

Operating incomeafter interest (*) 89.9 99.6

Income from companies 19.7 0.1accounted for by the equity method (before non-recurring items)

Tax on recurring income (30.5) (40.0)

Minority interests (4.5) (2.5)

Operating income after interest, tax and minority interests (*) 74.6 57.2 + 30.4%

(*) Net of employee profit sharing (2000 and 1999).

On an identical presentation basis, i.e. before

deducting employee profit-sharing, operating


would be € 84.3 million (FRF 553 million), well

in advance of the FRF 540 million objective

announced at the last Shareholders’ Meeting.

45A n n u a l R e p o r t 2 0 0 0

COMPANY ACCOUNTS

Changes in the Company’s portfolio

of direct interests

During 2000, FIMALAC S.A. invested € 17.9 million

(FRF 117 million) in TEAM PARTNERS GROUP. At

December 31, 2000, the Company held 6.93% of

the capital of this software engineering house

which specializes in the new economy.

FIMALAC S.A. also acquired a 14% interest in

CASHWARE, a company specializing in secure

Internet payment systems, representing an

investment of € 3.3 million (FRF 22 million).

Within the Group, FIMALAC S.A. provided equity

capital of € 87.6 million (FRF 575 million) to FITCH,

in connection with a share issue carried out to

finance the acquisition of DUFF & PHELPS, and

€ 45.2 million (FRF 296 million) to FIMALAC

INVESTISSEMENTS (formerly STRAFOR FACOM) in

connection with the public buyback offer made

in 2000.

Change in accounting method

for deferred charges

As explained in Note 1 to the Company financial

statements, in connection with the acquisition of

DUFF & PHELPS, the Company had to renegotiate

the syndicated loan obtained in 1999 for the

acquisition of the former STRAFOR FACOM. The

commitment and other bank flat fees on the new

syndicated loan have been recognized as deferred

charges and will be amortized over the period of

the loan. Fees relating to the original syndicated

loan were expensed in full in 1999. If these fees

had been deferred, this would have had the effect

of increasing net income for 1999 by € 5 million.

Company results

FIMALAC S.A. ended the year with net income of

€ 26.7 million (FRF 175 million), compared with

€ 14.8 million (FRF 97 million) in 1999.

Dividends received from subsidiaries rose sharply

to € 54.1 million (FRF 355 million):


FIMALAC INVESTISSEMENTS

(formerly STRAFOR FACOM) 24.5 14.9

FINANCIÈRE SECAP 18.1 -

LBC 4.1 3.5

MINERAIS & ENGRAIS 6.9 3.2

Other 0.5 0.6

54.1 22.2

Net external interest expense (excluding

transactions with subsidiaries) amounted to

€ 43.7 million (FRF 286 million) in 2000 compared

to € 6.0 million (FRF 39 million) in 1999. This

sharp rise was primarily attributable to the

increase in the Company’s average indebtedness

as a result of the external growth operations

carried out in 1999 and 2000.

No metal inventories were sold during 2000. The

Company intends to sell all of its remaining

precious metal inventories during 2001.

Finally, a provision of € 11.7 million (FRF 77

million) was recorded in 2000 against the shares

held by FIMALAC S.A. in TEAM PARTNERS GROUP, based

on the average price of the shares for the month

of December 2000.

46 A n n u a l R e p o r t 2 0 0 0


Sustained growth is expected in Europe in all

segments of the ratings business.

Thanks to FITCH’s critical mass, broad segment

coverage and substantial worldwide presence,

sales and earnings are expected to rise

significantly in 2001.

LBC

Despite the expected slow-down in the United

States, LBC should reap the benefits of its close

knit international network as well as its recent

acquisitions, both in Northern Europe and the

United States.

SECAP TECHNOLOGIES

Capital expenditure incurred for the development

of the range of franking machines is expected

to pay off for SECAP TECHNOLOGIES in 2001 and

significant growth is expected for folder-inserters.

The international subsidiaries acquired in 1999

and 2000 should also contribute to sales and

earnings growth.

CASSINA

The outlook for CASSINA is good, thanks to the

recent acquisition of MELTIMI and ALIAS and the

company's increasingly strong brand image

worldwide.

The FIMALAC Group as a whole

The FIMALAC Group has set as its objective to

achieve approximately 25% growth in consol-

idated operating income, compared with the 1999

figure of € 157.3 million (FRF 1,032 million),

barring unforeseen events and based on the

current Group structure.

SUBSEQUENT EVENTS

The two main events that have occurred since the

beginning of 2001 are CASSINA’s acquisition of

MELTIMI, a company specializing in high quality

lighting, and ALIAS, a designer furniture company.

OUTLOOK FOR 2001

2001 prospects derive from each of the Group’s

strategic subsidiaries:

FACOM

The hand tools business enjoyed a satisfactory

first quarter. The industrial fittings and

maintenance sectors are expected to remain

the principal growth drivers in 2001.

In garage equipment, BEISSBARTH AUTOMOTIVE GROUP

should reap the benefits of the renewal of its

wheel-related product range in 2001, increased

demand for brake test stands as a result of new

regulatory requirements and the development of

its vehicle hoist systems business.

The FACOM group expects to continue to gain

market share in 2001 in both of its business

segments, and further sales momentum should be

provided by the launch of new paper and online

catalogues.

FITCH

Recently-acquired DUFF & PHELPS and BANKWATCH

should make a significant positive contribution to

FITCH’s revenues and earnings in 2001. Growth was

strong in the United States during the first quarter

of 2001, with lower interest rates having a positive

impact on certain sectors of the ratings industry.

47A n n u a l R e p o r t 2 0 0 0

CORPORATE GOVERNANCE

Composition of the Board of Directors

MARC LADREIT DE LACHARRIÈRE

Chairman of the Board of Directors

First elected: June 14, 1990 (Director)

April 21, 1993 (Chairman)

Re-elected: June 17, 1996

Number of shares held: 1,406,153

PHILIPPE MALET, Honorary Chairman

Elected: April 21, 1993

PIERRE CASTRES SAINT-MARTIN, Director

First elected: June 26, 1998

Number of shares held: 70

GEORGES CHARPAK, Director



ALAIN GOMEZ, Director



BERNARD MIRAT, Director

First elected: April 21, 1993



ROBIN MONRO-DAVIES, Director



VÉRONIQUE MORALI, Director


Number of shares held: 7,500

BERNARD PIERRE, Director



FIMALAC PARTICIPATIONS, Director

Represented by PIERRE BLAYAU



Number of shares held: 1,250,150

SPERANS, Director

Represented by Gérard Mestrallet

First elected: May 28, 1999


MICHEL CASTRES SAINT-MARTIN, Censor



In 2000, the Board of Directors met four times.

48 A n n u a l R e p o r t 2 0 0 0


Remunerations Committee

The Remunerations Committee, which consists

of Pierre Castres Saint-Martin and Philippe Malet,

is charged with making recommendations to the

Board concerning the compensation to be paid

to the Chairman. The Committee bases its

recommendations on a report prepared by an

independent audit firm, which contains details

of all compensation and benefits paid to the

Group’s Chairman by FIMALAC and the various

French and foreign subsidiaries.

Compensation received by the Chairman

of the Board

In 2000, the total compensation received by Marc

Ladreit de Lacharrière, Chairman of the Board of

Directors of FIMALAC, from the French and foreign

companies of the Group, including salaries and

equivalents, benefits in kind and attendance fees

but excluding dividends, amounted to € 1,081,665

net of payroll taxes, other taxes and estimated

personal income taxes. In addition, at December

31, 2000, Marc Ladreit de Lacharrière held 36,162

FIMALAC S.A. stock options, representing 0.10% of

the Company’s capital at that date. The difference

between the exercise price of the options and the

FIMALAC S.A. share price at the end of 2000

represented a potential gain – net of deferred

taxes – of € 327,022.

Stock Options Committee

The Stock Options Committee, made up of

Pierre Castres Saint-Martin and Bernard Mirat,

is responsible for making recommendations to the

Board concerning the granting of stock options,

including the selection of grantees, the number of

options to be granted and the conditions of

exercise of the options.

Audit Committee

The Audit Committee consists of Michel Castres

Saint-Martin and Bernard Mirat. Its role is to

give its opinion to the Board on the financial

statements of the Company and the Group.

Funding of central services

by Group companies

On January 1, 1997, the FIMALAC Group set up an

intercompany partnership of which all Group

companies are members.

The partnership exists to fund the Group’s central

services and provide the resources required to

facilitate, develop, and improve the business and

results of its members.

To this end, the partnership provides services

and advice to Group companies in the areas

of administration, financial and management

accounting, auditing, legal affairs and internal and

external communications as well as consulting

activities.

The partnership allocates expenses among

Group companies at cost, in accordance with the

guidelines established in internal rules accepted

by all the companies concerned.

49A n n u a l R e p o r t 2 0 0 0

FIMALAC & CIE, the parent company of FIMALAC, also

contributes to the cost of the Group’s central

services. FIMALAC & CIE may carry out specific

research or provide advice in connection with

the Group’s development strategy and related

operations, at the request and on behalf of Group

companies. To date, no such requests have been

made.

Although this organization is not governed by

article L. 225-38 of the Commercial Code, FIMALAC

has elected to include its membership of the

intercompany partnership in the scope of

agreements governed by this article, in accordance

with the principles of corporate governance.

Contributions by FIMALAC S.A. to the intercompany

partnership amounted to approximately € 2.1

million, excluding tax, in 2000.

The allocation of expenses between members

provided for in the 2001 budget of the partnership

has been determined in accordance with the rules

laid down in the appendix to the partnership’s

internal rules, which have been amended to

take into account notably the entry of FIMALAC

INTERACTIVE into the Group.

FIMALAC’s contribution will amount to approx-

imately € 2.1 million, plus VAT. This amount may

be adjusted to take into account any amendments

to the budget or of any changes in the

membership of the intercompany partnership.

Cash pooling agreement

FACOM set up a cash pooling agreement with its

subsidiaries under which it was responsible for

managing the cash and cash equivalents of the

sub-group.

The agreement was terminated on October 1, 1999

and a new agreement was set up at the level

of FIMALAC covering all the French subsidiaries of

FIMALAC and all the French and foreign subsidiaries

of FACOM.

Under the terms of the new agreement, FIMALAC

manages all short-term investment and borrowing

transactions on behalf of all participating

companies, in the best interests of all the parties

taken as a whole by:

• making short-term advances to subsidiaries and

receiving advances from subsidiaries with cash

surpluses;

• negotiating short-term bank loans and overdrafts;

• investing any cash surpluses.

Although this organization is not governed by

article L. 225-38 of the Commercial Code, FIMALAC

has elected to include the agreement in the scope

of agreements governed by this article, in accord-

ance with the principles of corporate governance.

50 A n n u a l R e p o r t 2 0 0 0


INFORMATION

ABOUT THE CAPITAL

Capital

At December 31, 2000, the Company’s capital

amounted to € 137,956,152.40, divided into

31,353,671 fully paid-up common shares with a

par value of € 4.40 each, all in the same class.

Changes in capital (in EUR)

Year Description Increase Premium New capital New number in capital of shares

1972 11,438,524 625,265

1995 Capitalization of reserves 55,286,200 66,724,724 625,265(increase in par value of shares)

1996 Merger with ALSPI and CLAL 38,850,092 259,237,247 105,574,817 989,322

5-for-1 stock split 105,574,817 4,946,610

Exercise of stock options 619,583 864,154 106,194,400 4,975,640

1997 Exercise of stock options 3,686,873 552,634 109,881,273 5,148,385

1998 Merger with CENTENAIRE BLANZY 20,603,887 317 045,419 130,485,160 6,113,761


1999 Capitalization of reserves 4,034,820 135,079,846 6,139,993(increase in par value of shares)

Exercise of stock options 2,724,392 2,771,227 137,804,238 6,263,829

2000 5-for-1 stock split 137,804,238 31,319,145


Authorized capital

Description Amount in EURm Date of AGM Expires

Authorization to issue shares 230, including 150 without June 7, 2000 August 7, 2002 and share equivalents pre-emptive subscription rights

Ownership structure

As of January 31, 2001, Marc Ladreit de

Lacharrière, FIMALAC & CIE and the other members

of the shareholders’ pact together held 66.53%

of the Company’s capital (including 7.99% held

in treasury stock by FIMALAC) and 79.44% of the

voting rights.

51A n n u a l R e p o r t 2 0 0 0

Stock options granted by FIMALAC

Date of AGM June 10, 1993 June 10, 1993 June 10, 1993 June 18, 1997 June 18, 1997 June 26,1998 May 28, 1999(LBC) (ALSPI) (ALSPI) (FIMALAC) (CENTENAIRE BLANZY) (FIMALAC) (FIMALAC)

Date of Board meeting Oct. 14, 1993 Oct. 14, 1993 June 22, 1995 June 18, 1997 June 18, 1997Dec. 17, 1998 May 28, 1999

Total number of shares 182,878 83,340 83,343 6,862 33,959 31,350 1,000to be subscribed or bought

Balance at Dec. 31, 1999 (*) 5,395 41,830 67,995 25,830 133,470 142,285 5,020

Number of grantees 12 9 18 5 10 10 1

Beginning of exercise period June 18, 1997 June 18, 1997 June 22, 1995 June 18, 1997 June 18, 1997Dec. 17, 1998 May 28, 1999

Expiry of exercise period Oct. 15, 2001 Oct. 15, 2001 June 22, 2003 June 18, 2003 June 18, 2003Dec. 17, 2004 May 28, 2005

Subscription or purchase price in EUR (*) 4.64 8.22 9.24 14.96 16.24 18.93 18.95

Conditions of exercise - - 5 equal 5 equal 5 equal 4 tranches 4 tranchestranches tranches tranches

Number of shares 2,330 None 20,109 3,875 8,212 15,056 Nonesubscribed or bought in 2000

Number of options cancelled in 2000 None None None None None None None

Outstanding number of shares to be subscribed or boughtat Dec. 31, 2000 (*) 3,065 41,830 47,886 21,955 125,258 127,229 5,020

(*) After adjustment decided by the Board of Directors on September 21, 2000.

Details of stock options granted by subsidiaries of FIMALAC are presented below (information disclosed in

accordance with article L. 225-180 of the Commercial Code).

Stock options granted by FIMALAC INVESTISSEMENTS

Date of AGM June 17, 1988 June 3, 1992 June 3, 1992 June 3, 1992

Date of Board meeting Feb. 26, 1992 Dec. 8, 1993 Dec. 7, 1994 June 14, 1995

Total number of possible shares subscriptions 82,449 58,601 13,601 16,237

Balance at Dec. 31, 1999 (*) 10,698 1,245 5,217 16,656

Expiry of exercise period Feb. 25, 2000 Dec. 7, 2001 Dec. 6, 2002 June 13, 2003

Subscription price in EUR (*) 50.90 38.90 44.53 44.83

Number of shares having been subscribed in 2000 686 28 5,217 None

Number of options cancelled in 2000 10,012 None None None

Outstanding number of shares to be subscribed at Dec. 31, 2000 (*) None 1,217 None 16,656


52 A n n u a l R e p o r t 2 0 0 0


Share buybacks

On November 18, 1999, the Board of Directors decided to use the authorization given at the Annual General Meeting

of June 26, 1998 (5th resolution), by launching a share buyback program. Details of the program were provided in an

information memorandum approved by the French Stock Exchange authorities (« COB ») on November 12, 1998 under

no. 98-875.

As of December 31, 1999, the share buyback program had been implemented in full. During 2000, 528,778 shares with

a par value of € 4.40 were sold at an average price of € 32.34. Transaction costs on these sales totaled € 28,368.68.

As of December 31, 2000 the Company held 2,521,807 shares in treasury stock. The shares were acquired at a total cost

of € 51,301,346.10. Out of the total, 132,249 are being held for allocation on exercise of stock options granted by the

Board of Directors on December 17, 1998 and May 28, 1999.

Date of AGM June 3, 1992 June 3, 1992 June 4, 1997 June 4, 1997

Date of Board meeting Sept. 20, 1995 June 5, 1996 June 4, 1997 Feb. 4, 1998

Total number of possible shares subscriptions 47,923 60,797 63,187 46,142

Balance at Dec. 31, 1999 13,859 56,204 24,985 11,249

Expiry of exercise period Sept. 19, 2003 June 4, 2004 June 3, 2005 Feb. 3,2006

Subscription price in EUR (*) 41.61 49.96 59.03 59.81

Number of shares subscribed in 2000 9,703 None 19,779 1,275

Number of options cancelled in 2000 None None None None

Outstanding number of possible shares subscriptions at Dec. 31, 2000 (*) 4,156 56,204 5,206 9,974


Stock options granted by other subsidiaries

Name of company CLAL-MSX FINANCIÈRE SECAP FITCH INC FITCH INC FITCH INC

Date of AGM June 28, 1996 June 27, 1995 - - -

Date of Board meeting July 18, 1996 Oct. 16, 1995 Jan. 1, 1998 Oct. 26, 1998 Jan. 1, 1999

Total number of shares offered 1,540 30,000 110,656 47,767 31,737for subscription or purchase

Balance at Dec. 31, 1999 1,360 29,772 108,849 47,767 24,087

Number of grantees 10 255 55 24 26

Beginning of exercise period 2001 May 11, 1998 May 15, 1998 May 15, 1999 Jan. 1, 2002

Expiry of exercise period Sept. 30, 2001 May 14, 2000 Dec. 31, 2003 Dec. 31, 2003 Jan. 1, 2004

Subscription or purchase price € 349.11 € 48.78 $ 113 $ 113 $ 238

Conditions of exercise - - - - -

Number of options exercised in 2000 None 23,449 108,849 47,767 24,087

Number of options cancelled in 2000 None 6,323 None None None

Outstanding number of possible shares subscriptions 1,360 None None None Noneor purchases at Dec. 31, 2000 (*)

53A n n u a l R e p o r t 2 0 0 0

CO N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Consolidated

CONTENTS

Consolidated balance sheet

Consolidated statement of income

Consolidated statement of cash flows

Notes to the consolidated financial statements

Report of the Statutory Auditors

54

56

57

58

79

financial statementsin euro

54 A n n u a l R e p o r t 2 0 0 0

CO N S O L I D AT E D B A L A N C E S H E E T

(EUR thousands)

FIXED ASSETS

Goodwill 5.3 653,572 100,369 553,203 518,768

Intangible assets 5.1 1,082,870 22,899 1,059,971 440,877

Property, plant and equipment 5.2 908,980 529,573 379,407 382,060

Investments 5.4 140,843 48,904 91,939 75,030

Companies accounted for by the equity method 5.5 97,163 97,163 3,739

Total fixed assets 2,883,428 701,745 2,181,683 1,420,474

CURRENT ASSETSInventories and work-in-progress 5.6 277,647 23,891 253,756 279,384

Pre-payments to suppliers 2,252 2,252 3,097

Operating receivables 348,720 14,344 334,376 416,222

Accruals and other receivables 5.8 169,863 72 169,791 156,648

Marketable securities 39,660 2,926 36,734 393,985

Cash and cash equivalents 5.7 95,058 95,058 138,045

Total current assets 933,200 41,233 891,967 1,387,381

TOTAL ASSETS 3,816,628 742,978 3,073,650 2,807,855

ASSETS 2000 1999Note Cost Amortization Net Net

depreciationand provisions

at December 31, 2000

55A n n u a l R e p o r t 2 0 0 0

(EUR thousands)

SHAREHOLDERS' EQUITY 5.9

Capital 137,956 137,804

Additional paid-in capital 441,650 459,284

Retained earnings 167,469 105,588

Group consolidated income for the year 99,972 71,361

Other (30,395) (35,800)

Total shareholders’ equity 816,652 738,237

Minority interests 5.9 46,427 56,107

Quasi-equity 5.10 69,660 77,596

PROVISIONS FOR CONTINGENCIES AND CHARGES 5.11 348,904 383,777

LIABILITIES

Bank borrowings 5.12 1,333,694 1,079,233

Other borrowings 9,337

Customer prepayments 3,063 6,245

Accounts payable 320,864 382,623

Accruals and other liabilities 134,386 74,700

Total liabilities 1,792,007 1,552,138

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 3,073,650 2,807,855

Net asset value per share (EUR) (excluding treasury stock) 28.20 25.98

LIABILITIES AND SHAREHOLDERS' EQUITYNote 2000 1999

56 A n n u a l R e p o r t 2 0 0 0

CO N S O L I D AT E D S TAT E M E N T O F I N C O M E

(EUR thousands)

Sales 5.16 1,336,397 1,579,555

Other operating revenues 63,189 18,847

Materials cost of sales (658,722) (1,070,275)

Personnel costs (446,007) (311,232)

Other operating expenses (14,003) (11,916)

Taxes other than on income (19,212) (19,220)

Amortization, depreciation and provisions (104,367) (85,702)

Operating income 5.17 157,275 100,057

Interest income 56,687 49,421

Interest expense (124,076) (49,853)

Interest (expense) / income, net 5.13 (67,389) (432)

Operating income after interest 89,886 99,625

Non-recurring income, net 5.14 31,159 17,549

Current and deferred taxes 5.15 (30,368) (45,131)

Net income of consolidated companies 90,677 72,043

Income/(losses) from companies accounted for by the equity method (103) 144

Income/(losses) from companies to be divested 23,188 -

Net (additions) / reversals to amortization and provisions – goodwill (9,439) 149

Net income before minority interests 104,323 72,336

Minority interests 5.17 4,351 975

Consolidated net income 99,972 71,361

Basic net earnings per share (EUR) (Including treasury stock) 3.19 2.33

Diluted net earnings per share (EUR) (Including treasury stock) 3.17 2.31

Note 2000 1999

(years ended December 31)

57A n n u a l R e p o r t 2 0 0 0

CO N S O L I D AT E D S TAT E M E N T O F C A S H F L O W S

Cash and cash equivalents at January 1, 2000 (*) 534,302

Cash flows from operating activities

Net income 104,486

Income from companies accounted for by the equity method (22,972)

Depreciation, amortization and provisions 216,959

Provision reversals (104,871)

Book value of sold assets 157,461

Proceeds from asset disposals (212,328)

Subsidies and deferred taxes (4,594)

Cash flow from operations 134,141

Change in inventories (35,791)

Other movements (106,654)

Net cash provided by / (used in) operating activities (8,304)

Cash flows from investing activities

Acquisition of intangible assets (70,833)

Acquisition of property, plant and equipment (97,267)

Acquisition of investments (697,371)

Proceeds from disposals of fixed assets 192,995

Net cash of subsidiaries acquired and divested during the year (7,875)


Net cash provided by / (used in) investing activities (683,641)

Cash flows from financing activities

Net increase in bank borrowings 277,373

Increase in shareholders' equity 63,797

Dividends paid (22,594)


Net cash provided by / (used in) financing activities 315,019

Effect of exchange rate changes on cash and cash equivalents and other (25,202)

Cash and cash equivalents at December 31, 2000 (*) 132,174

(*) Cash and cash equivalents correspond to marketable securities and cash (+) or (-) the net balance of current accounts and (-) bank overdrafts.

(EUR thousands)

For the year ended December 31, 2000 Cash flows for the year

58 A n n u a l R e p o r t 2 0 0 0

NO T E S T O T H E C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

The consolidated financial statements of the

FIMALAC Group have been prepared in accordance

with French generally accepted accounting

principles, including standard CRC 99-02.

SIGNIFICANT EVENTS OF THE YEARPublic tender offer for DUFF & PHELPS

In April 2000, FITCH (formerly FITCH IBCA), a wholly

owned subsidiary of FIMALAC, made a friendly

takeover bid for DUFF & PHELPS. This company was

quoted on the New York stock exchange and was

the world’s fourth largest rating agency.

After the closure of the offer the company was

removed from the stock exchange and merged on

a 100% basis into FITCH.

DUFF & PHELPS was merged into FITCH on the basis

of the fair value of its assets and liabilities. Fair

value adjustments included recognition of non-

amortizable intangible assets valued at $ 515.4

million (€ 553.9 million at December 31, 2000)

DUFF & PHELPS’ operations have been consolidated

in the FIMALAC Group accounts as from April 2000.

Acquisition of BANKWATCH

In December 2000; FITCH acquired BANKWATCH, a

subsidiary of the Canadian group THOMSON

FINANCIAL specialized in bank ratings.

BANKWATCH’s assets and liabilities were contributed

to FITCH in exchange for 3.43% of FITCH’s capital.

A gain of € 25 million was recorded in the consolidated

accounts in connection with this transaction.

Public Buyback offer for FIMALAC INVESTISSEMENTS

(formerly STRAFOR FACOM)

In May 2000, FIMALAC launched a public buyback

offer for its subsidiary FIMALAC INVESTISSEMENTS with

the objective of holding the full capital of the

company, either directly or indirectly.

Disposal of ANFA

In July 2000, SECAP sold ANFA, its office supplies

subsidiary. The net gain on the sale amounted

to € 29.4 million.

Sale of CLESTRA

FIMALAC INVESTISSEMENTS (formerly FACOM S.A.) sold

its subsidiary CLESTRA on May 30, 2000 and the

company was deconsolidated from the same date.

At € 0.3 million, the impact of this sale on

consolidated net income was not material.

ENGELHARD-CLAL

As previously announced, in 2000 FIMALAC continued

to actively withdraw from the non-strategic

precious metal processing business. ENGELHARD-

CLAL’s Jewelry and Electrical Contacts operations –

which represent 45% of the company’s sales – were

sold in 2000 and FIMALAC reduced its stake in

the company to 49%. ENGELHARD-CLAL, which was

previously consolidated by the proportional

method, has been accounted for by the equity

method as from January 1, 2000 as it is no longer

jointly controlled by FIMALAC S.A. This change of

consolidation method did not have any impact on

2000 consolidated net income as the Group’s share

in earnings of ENGELHARD-CLAL is still presented in

the accounts although on a separate line.

FACOM

Hand tools

During the first half of 2000, COFICOM, a FACOM

subsidiary, launched a public tender offer followed

by a public buyback offer for the shares of its

subsidiary VIRAX. The acquisition price was € 3.2

million. Goodwill amounted to € 2.1 million and

is being amortized over 10 years.

Garage equipment

The operations of FOG, TECALEMIT and ZIPPO were all

consolidated in the FACOM group accounts as from

January 1, 2000. After fair value adjustments,

including the recognition of trademarks under

intangible assets, goodwill on the acquisition of

these companies amounted to € 8.7 million.

NOTE 1 - BASIS OF CONSOLIDATIONAND SUMMARY OF SIGNIFICANTACCOUNTING POLICIES

1.1 - BASIS OF CONSOLIDATION

All significant companies controlled directly

or indirectly either exclusively or trough the

ownership of more than 50% of the shareholders

equity by the FIMALAC Group, are fully consolidated.

Exclusive control is considered to be exercised in

cases where the Group holds, directly or indirectly,

at least 40% of the voting rights, or is in a position

to appoint the majority of the members of the Board

of Directors or equivalent, and no other shareholder

holds, directly or indirectly, a higher percentage of

the voting rights.

Companies over which the company exercises

significant influence without having control are

accounted for by the equity method. Significant

influence is considered to be exercised in cases

where 20% to 50% of the voting rights are held by

the Group.

1.2 - CLOSING DATE

The consolidated financial statements have been

prepared on the basis of individual company

accounts or interim accounts at December 31.

1.3 - ADJUSTMENTS AND ELIMINATIONS

To p e r m i t c o m p a r i s o n , t h e a c c o u n t s o f

For the year ended December 31, 2000 (in EUR thousands)

59A n n u a l R e p o r t 2 0 0 0

c o n s o l i d a t e d c o m p a n i e s a re a d j u s t e d i n

accordance with the accounting principles set

forth below. All significant intercompany balances

and gains or losses on intercompany transactions

are eliminated in consolidation.

1.4 - FOREIGN CURRENCY TRANSLATION

1. Foreign currency receivables and debts

Receivables and debts denominated in foreign

currencies are translated at official year-end

exchange rates. For French companies, a foreign

currency is any currency other than the euro; for

the foreign subsidiaries, a foreign currency is any

currency other than that used for their financial

statements. Unrealized gains and losses arising

from translation are recorded in the income

statement.

2. Financial statements of foreign subsidiaries

The balance sheets of foreign subsidiaries are

translated into euro at official year-end exchange

rates and their income statements at average

exchange rates for the year. Differences arising

on translation are debited or credited to

shareholders equity; the Group share in these

differences are included in consolidated shareholders'

equity under « Cumulative translation adjustment ».

The exchange rates against the euro used for 2000

are as follows:

2000 2000 1999Currency year-end rate average rate year-end rate

Pound sterling 1.6023 1.6413 1.6085

US dollar 1.0747 1.0852 0.9954

1.5 - LEGAL REVALUATION

The impact of the 1976 legal revaluation of assets

has been eliminated in consolidation. Earlier

revaluations did not have a material impact and

have therefore not been restated.

1.6 - RESEARCH AND DEVELOPMENT COSTS

Research and development costs are expensed in

the period in which they are incurred.

1.7 - PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are stated at cost,

net of accumulated depreciation. Depreciation is

calculated by the straight-line or reducing balance

method over the estimated useful lives of the

assets in question, as follows:

Buildings: 10 to 40 years (straight-line)

Fixtures and fittings: 5 to 10 years (straight-line)

Plant and equipment: 5 to 10 years (straight-line

or reducing balance)

LBC Group storage tanks: Tanks, pipework and

pipelines: 20 years (straight line)

Improvements to tanks made after their acquisition:

10 years (straight line)

Vehicles: 4 to 5 years (straight-line)

Office equipment and furniture: 5 to 10 years

(straight-line or reducing balance)

Equipment leased by the SECAP Group: 5 years

(reducing balance)

Additions to property, plant and equipment are

stated at cost. Significant assets acquired under

finance leases are capitalized and depreciated

over their estimated useful lives. An obligation in

the same amount is recorded as a liability.

1.8 - GOODWILL

The difference between the cost of an investment

and the Group’s equity in the underlying

net assets as of the date of acquisition or

consolidation, is allocated to identifiable assets

(purchased goodwill, land, buildings and

investments) or liabilities on the basis of fair

values and any unallocated balance is classified

as goodwill. Positive goodwill is included in

intangible assets and amortized over 10 to 40

years, depending on the sector. Negative goodwill,

or badwill, is written back to income over a period

of 10 years, unless it is qualified as a contingency

provision, in which case the provision is adjusted

as required to reflect changes in the level of risk.

Fair value adjustments to intangible assets and

property, plant and equipment are as follows:

(EUR thousands) Fair value adjustments

Purchase goodwillFITCH INC (USD 83,743 thousand) 89,998FITCH (DUFF & PHELPSACQUISITION) (USD 512,423 thousand) 553,920FITCH (BANKWATCHACQUISITION) (USD 47,561 thousand) 51,113

FITCH LTD (GBP 6,516 thousand) 10,481

Sub-total FITCH 705,512

PETROUNITED (USD 30,800 thousand) 33,100

TrademarksFACOM 182,939

VIRAX 15,245

BOST 4,573

Other trademarksCASSINA 38,527

FACOM Group

USAG 25,751

BEISSBARTH 19,940

MECANOBLOC 5,336

Other 21,384

LandPETROUNITED* (USD 12,927 thousand) 13,893* Revaluation

60 A n n u a l R e p o r t 2 0 0 0


Valuation of intangible assets of the rating

business (FITCH)

At December 31, 2000 intangible assets of

the rating business totaled € 705.5 million.

This amount is principally attributable to the

acquisition of FITCH in December 1997, followed by

FITCH’s own acquisitions of DUFF & PHELPS and

BANKWATCH in 2000.

As rating is a service business, the companies

have few tangible assets. Intangible assets are

valued principally by reference to the companies’

capacity to generate income based on their know-

how, the quality of their research teams, their

technical expertise, company name and the ability

of FITCH to acquire and build market share.

The valuation is based on a five-year strategic and

financial plan prepared by management. At each

year-end, the carrying value of these intangible

assets is assessed by reconciling the results

generated by the companies with the five-year

plan. A provision for impairment in value is

recorded for any material difference between

actual figures and the five-year plan, calculated on

the basis of market values.

PETROUNITED purchased goodwill

The valuation of purchased goodwill at December

31, 2000, based on storage capacity and projected

future earnings, is in line with that determined at

the time of acquisition of PETROUNITED in 1998.

Consequently, the purchased goodwill has not

been written down in the consolidated financial

statements at December 31, 2000.

1.9 - INVESTMENTS

Investments in non-consolidated companies are

stated at cost. Provision is made in the case of

any permanent impairment in value, determined

on the basis of the Group's equity in the

underlying net assets, investment yield, earnings

projections and development potential.

In the case of quoted shares, account is taken of

representative stock market prices.

1.10 - INVENTORIES AND RECEIVABLES

Inventories and work-in-progress

Raw materials are valued by the FIFO (first in, first

out) method, with the exception of inventories held

by CLAL-MSX. Other work-in-progress and finished

product inventories are valued at cost, comprising

raw materials purchase costs, labor, direct

production costs and a portion of burden. Provision

is made when cost is higher than market.

Metal inventories held by CLAL-MSX

Metals inventories are stated at the lower of cost

and market. Cost has been determined by the LIFO

(last in, first out) method since July 1, 1995.

Metal inventories held by FIMALAC S.A.

Inventories correspond to precious metals

previously used by the CLAL parent company which

was merged into FIMALAC S.A. in 1996. They are being

leased to various credit institutions.

FIMALAC S.A. has set up a hedging program based on

forward sales to reduce its exposure to market risks

resulting from fluctuations in prices of precious

metals. These forward sales cover total precious

metals inventories, which are carried in the balance

sheet at a cost of € 45.1 million. In addition, the

Company has taken out a gold indexed hedging

loan for an amount of € 6 million. The valuation

of inventories takes account of these hedging

transactions.

Operating receivables

Operating receivables are stated at their nominal

value. Provision is made for any risk of non-

recovery.

1.11 - MARKETABLE SECURITIES

Marketable securities are stated at cost. Provisions

for impairment in value are calculated on a case by

case basis, to cover the difference between their

average cost and stock market price.

1.12 - NET ASSET VALUE AND EARNINGS

PER SHARE

Net assets per share are determined on the basis

of the number of shares outstanding at the year-

end. At December 31, 2000, the calculation was

based on the 31,353,671 shares outstanding, less

the 2,389,558 shares held in treasury stock,

representing 7.62% of the capital.

The same calculation was performed at December

31, 1999, taking into account the number of

shares held in treasury stock at that date. The net

number of shares used for the calculation was

28,964,113 at December 31, 2000 and 28,667,635

at December 31, 1999.

Net earnings per share are determined by

reference to the average number of shares

outstanding during the year including treasury

stock, i.e. 31,324,209 shares in 2000.

In 1999 the average number of shares outstanding

during the year, including treasury stock was

30,635,122.

Treasury stock

Number of % of capital CarryingFIMALAC shares held value

Shares held in treasury stock (excluding shares carried under « Marketable securities ») 2,389,558 7.62% 47,474

61A n n u a l R e p o r t 2 0 0 0

1.13 - INCOME TAXES

The tax charge comprises:

- income taxes currently payable, net of dividend

and other tax credits set off against the tax due;

- deferred taxes arising from timing differences

between the recognition of certain items of

income and expense for consolidated financial

reporting and tax purposes, determined by the

liability method.In accordance with the principle

of prudence, net deferred tax assets, determined

company by company, are recognized only to the

extent that it is probable that the asset will be

recovered in the foreseeable future.

Exceptional 6% surtax (2001) and 3% surtax

(subsequent years)

This surtax has been included in the tax rate used

to calculate all deferred tax assets and liabilities.

The 3.3% « contribution sociale » surtax has also

been taken into account in the tax rate, subject to

certain conditions.

Deferred taxes expected to reverse in 2001 have

been calculated using a minimum rate of 35.33%

and a maximum rate of 36.43% and those

expected to reverse in 2002 and beyond using a

minimum rate of 34.33% and a maximum of 35.43%.

1.14 - SUPPLEMENTARY PENSIONS

AND RETIREMENT BONUSES

Group companies and their employees make

contributions to various compulsory pension

schemes. The funds are managed by independent

bodies and Group companies have no other pension

obligations.

Provisions have been made for obligations resulting

from the optional supplementary pension schemes

for former Board members and their assignees.

The Group's liability for statutory retirement

bonuses not funded under insured plans is included

in provisions for charges. The estimated liability is

determined on an actuarial basis, in accordance

with the recommendations of the French Institute of

Accountants (Ordre des Experts Comptables), using

assumptions related to:

- salary on retirement;

- payroll tax rate;

- vested benefit obligations based on years of

service;

- mortality rate;

- staff turnover rate;

- discount rate.

1.15 - OTHER PROVISIONS

Other provisions correspond to identified cont-

ingencies and charges.

At year-end, provisions are analyzed on a case by

case basis and may be reversed or additional

provisions may be set up.

Provisions for fluctuations in metal prices

The metal inventories held by FIMALAC S.A. since the

merger with CLAL are intended to be sold over time.

The provision booked prior to the merger is being

released to reflect sales made out of inventory

during the year. No charges have been made to the

provision since the merger with CLAL.

62 A n n u a l R e p o r t 2 0 0 0


NOTE 2 - SCOPE OF CONSOLIDATION

2.1- LIST OF CONSOLIDATED COMPANIES

FIMALAC S.A. 100.00 100.00 Parent 100.00 100.00 Parent97, rue de Lille - 75007 Paris (France) Company CompanySiren n° 542044136

CLAL-MSX 100.00 100.00 Full 100.00 100.00 FullRoute du Ménillet - 60540 Bornel (France)Siren n° 400723516

CLAL-MSX ITALIE 100.00 100.00 Full 100.00 100.00 FullVia Moresi 5 - 20123 Milano (Italy)

CLAL US 100.00 100.00 Full 100.00 100.00 Full97, rue de Lille - 75007 Paris (France)

CLAL DK (liquidated) (in process of liquidation)Studiestraede 7 - 1455 Copenhague (Denmark)

LBC 100.00 100.00 Full 100.00 100.00 Full5 ter, rue du Dôme - 75016 Paris (France)Siren n° 314841636

LBC PETROUNITED 100.00 100.00 Full 100.00 100.00 Full333, Clay Street, Suit 4300Houston - Texas (USA)

LBC SOTRASOL 99.88 99.88 Full 99.87 99.87 Full5 ter, rue du Dôme - 75016 Paris (France)Siren n° 542057500

SOGESTROL 50.00 50.00 Proportional 50.00 50.00 ProportionalRoute de la Chimie76700 Gonfreville-l’Orcher (France)

LBC MARSEILLE 99.99 99.99 Full 99.99 99.99 FullRte du Port-Pétrolier - 13117 Lavera (France)Siren n° 588113810

PACSUD 64.98 64.99 Full 64.98 64.99 FullRte du Port-Pétrolier - 13117 Lavera (France)Siren n° 378395115

LBC NANTES 99.55 99.55 Full 99.55 99.55 Full103, quai E.-Cormerais - 44800 St-Herblain (France)Siren n° 303217483

LBC ANTWERPEN 100.00 100.00 Full 100.00 100.00 FullHaven 275 Léon Bonnetweg 282030 Anvers (Belgium)

FINANCIÈRE GTS 100.00 100.00 Full 100.00 100.00 FullHaven 275 Léon Bonnetweg 282030 Anvers (Belgium)

LBC TANQUIPOR 71.11 71.11 Full 71.11 71.11 FullParque Industriel Do Bareiro2830 Bareiro (Portugal)

TERQUISA 56.29 56.29 Full 56.29 56.29 FullSanta Cruz de Marcelado 3128015 Madrid (Spain)

TERLIQ 78.14 100.00 Full 78.14 100.00 FullSanta Cruz de Marcelado 3128015 Madrid (Spain)

LBC ROTTERDAM 100.00 100.00 Full 100.00 100.00 FullOude Maasweg 43197 Botlek - Rotterdam (Netherlands)

2000 1999

% interest % Voting Consolidation % interest % Voting Consolidationrights method rights method

LBC subsidiaries % Interest % Voting rights % Interest % Voting rightsheld by LBC held by LBC held by LBC held by LBC

63A n n u a l R e p o r t 2 0 0 0

RHÉNAMÉCA 100.00 100.00 Full 100.00 100.00 Full97, rue de Lille - 75007 Paris (France)Siren n°722007960

FINANCIÈRE SECAP 99.37 99.37 Full 97.11 97.11 Full21, quai Alphonse-le-Gallo - 92102 Boulogne-Billancourt (France)Siren n° 343693701

SECAP 99.19 99.82 Full 96.57 99.82 Full21, quai Alphonse-le-Gallo - 92102 Boulogne-Billancourt (France)Siren n° 562046235

2000 1999


SECAP subsidiaries % Interest % Voting rights % Interest % Voting rightsheld by SECAP held by SECAP held by SECAP held by SECAP

SECAP INDUSTRIE 99.56 99.56 Full 99.56 99.56 Full11, rue des Bretons - 93210 Saint-Denis-la-Plaine (France)Siren n° 562043307

ANFA (divested) 100.00 100.00 FullZA les Bordes - 20, rue H.-Dunant - 91923 Bondoufle (France)Siren n° 552047763

SOPALIL 100.00 100.00 Full 100.00 100.00 Full21, quai Alphonse-le-Gallo - 92102 Boulogne-Billancourt (France)Siren n° 303970701

SFFEP 100.00 100.00 Full 100.00 100.00 Full21, quai Alphonse-le-Gallo - 92102 Boulogne-Billancourt (France)Siren n° 343157715

SCI SILLIC 52.00 52.00 Full 52.00 52.00 Full22, rue du Puits-Rochefort - 42100 Saint-Étienne (France)Siren n° 380417402

SCI LOCA GENAS 100.00 100.00 Full 100.00 100.00 FullZA les Bordes - 20, rue H.-Dunant - 91923 Bondoufle (France)Siren n° 338113780

SECAP POSTHANTERING AB 100.00 100.00 Full 100.00 100.00 FullTumstocksvagen 11b - 18714 Tay(Sweden)

ASI HOLDING LTD 100.00 100.00 FullRaleignt Way - FELTHAM Middlesex TW13 7NQ(United Kingdom)

SECAP US 100.00 100.00 Full10, Clipper Road West Conshohocken(USA)

ENGELHARD-CLAL SAS 49.00 49.00 Equity 50.00 50.00 Proportional8, rue Portefoin75003 Paris (France)

ENGELHARD-CLAL LP 49.00 49.00 Equity 50.00 50.00 Proportional700 Blair Road - Carteret, New Jersey 07800(USA)

64 A n n u a l R e p o r t 2 0 0 0


2000 1999


FITCH IBCA SEVEREIGN RATINGS (UK) 100.00 100.00 Full 100.00 100.00 Full

FITCH IBCA RATINGS (Spain) 100.00 100.00 Full 100.00 100.00 Full

FITCH IBCA (Argentina) 100.00 100.00 Full 100.00 100.00 Full

FITCH IBCA (South Africa) 100.00 100.00 Full 100.00 100.00 Full

IBCA RATINGS INSURANCE LTD (UK) 100.00 100.00 Full 100.00 100.00 Full

FITCH IBCA PTE LTD (Singapore) 100.00 100.00 Full 100.00 100.00 Full

FITCH IBCA (Hong-Kong) 100.00 100.00 Full 100.00 100.00 Full

FITCH IBCA BRASIL LTDA (Brazil) 100.00 100.00 Full 100.00 100.00 Full

FITCH IBCA HOLDING SA (Chile) 100.00 100.00 Full 100.00 100.00 Full

INTER ARAB RATING COMPANY (Arab Emirats) 60.00 60.00 Full 60.00 60.00 Full

FITCH IBCA SA (France) 100.00 100.00 Full 100.00 100.00 Full

FITCH IBCA (Mexico) 98.45 98.45 Full 100.00 100.00 Full

FITCH IBCA (Australia) 100.00 100.00 Full 100.00 100.00 Full

PAKISTAN CREDIT RATING AGENCY 44.44 44.44 Full 44.44 44.44 Full

FITCH IBCA (Peru) 20.00 20.00 Equity 20.00 20.00 Equity

FITCH IBCA (Venezuela) 20.00 20.00 Equity 20.00 20.00 Equity

RATING COMPANY LTD 30.00 30.00 Equity

DCR MEXICO 40.00 40.00 Equity

ITALRATING DCR SPA 96.83 96.83 Full

FITCH RATING LTD (Thailand) 39.90 39.90 Equity

TTC THOMSON HOLDING AG 100.00 100.00 Full

FITCH LTD subsidaries % Interest % Voting rights % Intérêt % Voting rightsheld by held by held by held by

FITCH IBCA LTD FITCH IBCA LTD FITCH IBCA LTD FITCH IBCA LTD

FITCH INC 96.57 96.57 Full 100.00 100.00 Full1, State Street PlazaNew York 1004 (USA)

DUFF & PHELPS 96.57 96.57 Full1, State Street PlazaNew York 1004 (USA)

FITCH INFO 96.57 96.57 Full 100.00 100.00 Full1, State Street PlazaNew York 1004 (USA)

FITCH LTD 96.57 96.57 Full 100.00 100.00 FullEldon House - 2 Eldon StreetLondon (United Kingdom)

FIMALAC INC subsidaries % Interest % Voting rights % Interest % Voting rightsheld by held by held by held by

FIMALAC INC FIMALAC INC FIMALAC INC FIMALAC INC

MINERAIS & ENGRAIS 100.00 100.00 Full 99.95 99.95 Full97, rue de Lille - 75007 Paris (France)Siren n° 562124529

SNC SÉFI 100.00 100.00 Full 100.00 100.00 Full97, rue de Lille - 75007 Paris (France)Siren n° 381887231

CATRIMMO 100.00 100.00 Full 99.95 100.00 Full97, rue de Lille - 75007 Paris (France)Siren n° 351983176

FIMALAC COMMUNICATION Merged 99.95 100.00 Full97, rue de Lille - 75007 Paris (France)Siren n° 632014221

FIMALAC INC 100.00 100.00 Full 99.95 100.00 Full1, State Street PlazaNew York 1004 (USA)

65A n n u a l R e p o r t 2 0 0 0

2000 1999


FIMALAC subsidaries % Interest % Voting rights % Interest % Voting rightsheld by FIMALAC held by FIMALAC held by FIMALAC held by FIMALAC

INVESTISSEMENTS INVESTISSEMENTS INVESTISSEMENTS INVESTISSEMENTS

SOCIÉTÉ DE CADRES FACOM 100.00 100.00 Full 100.00 100.00 Full97, rue de Lille - 75007 Paris (France)

FIMALAC INVESTISSEMENTS 99.78 99.78 Full 95.89 95.89 Full97, rue de Lille - 75007 Paris (France)Siren n° 552012965

FACOM FINANCEMENT 100.00 100.00 Full 100.00 100.00 Full97, rue de Lille - 75007 Paris (France)Siren n° 572018489FACOM DÉVELOPPEMENT 100.00 100.00 Full 100.00 100.00 Full97, rue de Lille - 75007 Paris (France)Siren n° 341269512STRAFOR FACOM INC 100.00 100.00 Full 100.00 100.00 Full292 South State Street Down19091 Delaware (USA)S I F S 100.00 100.00 Full 100.00 100.00 Full97, rue de Lille - 75007 Paris (France)Siren n° 318785656BONGARD INDUSTRIES (divested) 18.73 18.73 Equity32 route de Wolfinsheim - 67810 Holtzheim (France)CLESTRA (HOLDING) (divested) 100.00 100.00 Full56 rue Jean Giraudoux - 67200 Strasbourg(France)

CASSINA SPA subsidaries % Interest % Voting rights % Interest % Voting rightsheld by CASSINA held by CASSINA held by CASSINA held by CASSINA

KUTEK - MONZA (Italy) 60.00 60.00 Full 60.00 60.00 Full

MECCANICA VALBONA - MEDA (Italy) 100.00 100.00 Full 100.00 100.00 Full

CASSINA SA - PARIS (France) 100.00 100.00 Full 100.00 100.00 Full

CASSINA INC - NEW YORK (USA) 100.00 100.00 Full 100.00 100.00 Full

NEMO SRL - MEDA (Italy) 100.00 100.00 Full 100.00 100.00 Full

ITALIANA LUCE AMERICA INC - HAMDEN (USA) 100.00 100.00 Full 100.00 100.00 Full

PRICA (Italy) 67.00 67.00 Full

CASSINA SPA 80.00 80.00 Full 100.00 100.00 FullVia L. Busnelli 1 - 20036 Meda (Italy)

66 A n n u a l R e p o r t 2 0 0 0


2000 1999


FACOM 100.00 100.00 Full 100.00 100.00 Full6/8 rue Gustave Eiffel - 91420 Morangis (France)Siren n° 328630645

FACOM FAR EAST SINGAPORE 100.00 100.00 Full 100.00 100.00 FullFACOM GMBH - MUNCHEN (Germany) 100.00 100.00 Full 100.00 100.00 FullFacom Belgique - ZAVENEM (Belgium) 100.00 100.00 Full 100.00 100.00 FullFACOM NORDEN - SUNDS (Denmark) 100.00 100.00 Full 100.00 100.00 FullFACOM TOOLS LTD - CHERTSEY (United Kingdom) 100.00 100.00 Full 100.00 100.00 FullFACOM GEREEDSCHAPPEN BV - VIANEN (Netherlands) 100.00 100.00 Full 100.00 100.00 FullFACOM SA/AG - FRIBOURG (Switzerland) 100.00 100.00 Full 100.00 100.00 FullFACOM HERRAMIENTAS SRL - MADRID (Spain) 100.00 100.00 Full 100.00 100.00 FullFACOM TOOLS INC - CHICAGO (USA) 100.00 100.00 Full 100.00 100.00 FullSK HAND TOOLS - CHICAGO (USA) 100.00 100.00 Full 100.00 100.00 FullFACOM INVESTMENT LTD - CANNOCK (United Kingdom) 100.00 100.00 Full 100.00 100.00 FullAUTO TOOLS LTD - CANNOCK (United Kingdom) 100.00 100.00 Full 100.00 100.00 FullSYKES PICKAVANT PLC - CANNOCK (United Kingdom) 100.00 100.00 Full 100.00 100.00 FullSYKES PICKAVANT LTD - CANNOCK (United Kingdom) 100.00 100.00 Full 100.00 100.00 FullVITREX LTD - CANNOCK (United Kingdom) 100.00 100.00 Full 100.00 100.00 FullBRITOOL LTD - CANNOCK (United Kingdom) 100.00 100.00 Full 100.00 100.00 FullCOFICOM - MORANGIS (France) 100.00 100.00 Full 100.00 100.00 FullB G I - ARBOIS (France) 100.00 100.00 Full 100.00 100.00 FullD E L A - MORANGIS (France) 100.00 100.00 Full 100.00 100.00 FullVIRAX - EPERNAY (France) 100.00 100.00 Full 100.00 100.00 FullMINGORI - CUISE-LA-MOTTE (France) 100.00 100.00 Full 100.00 100.00 FullPIAULE PAROLAI EQUIPT - FEUQUIERES-EN-VIMEU (France) 100.00 100.00 Full 100.00 100.00 FullVIDMAR - LA MURE (France) 100.00 100.00 Full 100.00 100.00 FullC E E G - EZY-SUR-EURE (France) 100.00 100.00 Full 100.00 100.00 FullS E E G - BRIE-COMTE-ROBERT (France) 100.00 100.00 Full 100.00 100.00 FullUTENSILERIE ASSOCIATE SPA - MONVALLE (Italy) 100.00 100.00 Full 100.00 100.00 FullPIETRO PASTORINO SPA - COCQUIO (Italy) 100.00 100.00 Full 100.00 100.00 FullCOMEC SPA - FANO (Italy) 100.00 100.00 Full 100.00 100.00 FullFACOM AUTOMOTIVE TOOLS GMBH - MUNCHEN (Germany) 100.00 100.00 Full 100.00 100.00 FullFACOM AUTOMOTIVE TOOLS SRL - CORREGGIO (Italy) 100.00 100.00 Full 100.00 100.00 FullBEISSBARTH GMBH - MUNCHEN (Germany) 100.00 100.00 Full 100.00 100.00 FullINES ELEKTRONIK SYSTEMENT - MUHLDORF (Germany) 100.00 100.00 Full 100.00 100.00 FullU. Kasse - MUNCHEN (Germany) 100.00 100.00 Full 100.00 100.00 FullBEISSBARTH USA INC - NASHVILLE (USA) 100.00 100.00 Full 100.00 100.00 FullBEISSBARTH LTD - NOTTINGHAM (United Kingdom) 100.00 100.00 Full 100.00 100.00 FullBEISSBARTH ITALIE SRL - FORMIGINIE (Italy) 100.00 100.00 Full 100.00 100.00 FullBEISSBARTH BULGARIA GMBH - SOFIA (Bulgaria) 100.00 100.00 Full 100.00 100.00 FullBEISSBARTH BELGIUM BVBA - ZAWENTEM (Belgium) 100.00 100.00 Full 100.00 100.00 FullBEISSBARTH GESMBH - WIEN (Austria) 100.00 100.00 Full 100.00 100.00 FullBEISSBARTH PTY LTD - THOMASTOWN (Austria) 100.00 100.00 Full 100.00 100.00 FullSICAM SRL - CORREGGIO (Italy) 100.00 100.00 Full 100.00 100.00 FullAUTO CONSULT - FRANKFURT (Germany) 100.00 100.00 FullLEV - PLYMOUTH (United Kingdom) 100.00 100.00 FullZIPPO (Italy) 100.00 100.00 FullTECALEMIT - PLYMOUTH (United Kingdom) 100.00 100.00 FullFFB - MYENNES (France) 100.00 100.00 Full

FACOM subsidaries % Interest % Voting rights Consolidation % Interest % Voting rights Consolidationheld by FACOM held by FACOM method held by FACOM held by FACOM method

67A n n u a l R e p o r t 2 0 0 0

Published balance sheet Restated 1999 1999 publishedat Dec. 31, 2000 balance sheet balance sheet (*)

ASSETSFIXED ASSETSGoodwill 553,203 518,602 518,768

Intangible assets 1,059,971 440,576 440,877

Property, plant and equipment 379,407 354,071 382,060

Investments 91,939 88,099 75,030

Companies accounted for by the equity method 97,163 74,550 3,739

Total fixed assets 2,181,683 1,475,898 1,420,474

CURRENT ASSETSInventories and work-in-progress 253,756 223,991 279,384

Operating receivables 336,628 364,795 419,319

Accruals and other receivables 169,791 157,148 156,648

Cash and marketable securities 131,792 521,375 532,030

Total current assets 891,967 1,267,309 1,387,381

TOTAL ASSETS 3,073,650 2,743,207 2,807,855

LIABILITIES AND SHAREHOLDERS' EQUITYShareholders' equity 816,652 738,237 738,237

Minority interests 46,427 55,997 56,107

Quasi-equity 69,660 77,596 77,596

Provisions for contingencies and charges 348,904 364,678 383,777

Liabilities

Bank borrowings 1,333,694 1,053,518 1,079,233

Other borrowings - 9,320 9,337

Accounts payable 323,927 360,991 388,868

Accruals and other liabilities 134,386 82,870 74,700

Total liabilities 1,792,007 1,506,699 1,552,138

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 3,073,650 2,743,207 2,807,855

(*) Balance sheet 1999 including ENGELHARD-CLAL by the proportional method.

PR O F O R M A BA L A N C E S H E E T AT DE C E M B E R 31, 2000

(EUR thousands)

NOTE 3 - PRO FORMA INFORMATION

CHANGES IN SCOPE OF CONSOLIDATION

The main change in Group structure in 2000

were as follows:

Newly consolidated companies

• DUFF & PHELPS (acquisition April 2000)

• BANKWATCH (contribution December 2000)

Deconsolidated companies

• ANFA (sold in July 2000) subsidiary of SECAP

• CLESTRA (deconsolidated from May 31, 2000)

Change in consolidation method

• ENGELHARD-CLAL: further to sale of 1% of the

capital of this company, FIMALAC's interest was

reduced from 50% to 49%. FIMALAC therefore no

longer exercises joint control.

In order to permit meaningful year-on-year

comparisons, the following pro forma balance

sheet and income statement have been prepared,

in which 1999 published figures have been

restated exclusively to take into account the

change in consolidation method for ENGELHARD-CLAL

as described in paragraph 1.1 above.

68 A n n u a l R e p o r t 2 0 0 0


NOTE 4 - CHANGES IN ACCOUNTING METHODS

APPLICATION OF NEW FRENCH ACCOUNTING

STANDARDS

The accounting policies used for the preparation of

the 2000 financial statements reflect the adoption

of standard CRC 99-02.

As a result, certain items have been reclassified

in the financial statements at December 31, 2000.

To permit meaningful year-on-year comparisons,

these reclassifications have also been made to the

financial statements at December 31, 1999.

The net impact on opening shareholders’ equity of

the adoption of this new standard was a decrease

of € 9,066 thousand. The other effects were

mainly reclassifications as described below, which

did not have any impact on net income or share-

holders’ equity.

2000 1999 1999published restated published (*)

Sales 1,336,397 850,521 1,579,555

Operating income 157,275 97,535 100,057

Net interest income/(expense) (67,389) 1,754 (432)

Operating income after interest 89,886 99,289 99,625

Non-recurring income, net 31,159 13,616 17,549

Current and deferred taxes (30,068) (43,857) (45,131)

Income/(losses) from companies accounted for by the equity method (103) 144 144

Income from companies to be divested (**) 23,188 3,111 -

Consolidated net income 99,972 71,361 71,361

(*) 1999 income statement including ENGELHARD-CLAL by the proportional method.(**) Data relating to ENGELHARD-CLAL.

PR O F O R M A I N C O M E S TAT E M E N T

(EUR thousands)

2000 1999

BALANCE SHEETASSETSOther receivables 65,983 76,394

Reclassification of deferred taxes 83,923 73,000

Reclassification of deferred tax liabilities - (11,261)

Reclassification of accruals and prepaid expenses 19,885 18,515

Other receivables – new accounting standards 169,791 156,648LIABILITIES AND SHAREHOLDERS’ EQUITYOther liabilities 66,455 34,390

Reclassification of deferred tax liabilities 15,834 19,245

Reclassification of deferred tax assets - (11,261)

Reclassification of accruals and deferred income 52,097 32,326

Other liabilities – new accounting standards 134,386 74,700

INCOME STATEMENTOperating income 187,921 108,053

Reclassification of employee profit-sharing (*) (30,646) (7,996)

Operating income – new accounting standards 157,275 100,057

(*) This reclassification has no impact on net income.

(EUR thousands)

69A n n u a l R e p o r t 2 0 0 0

(EUR thousands) 1999 Increase Decrease Changes Translation Merger 2000in scope of adjustment and other

consolidation

Cost 465,669 626,051 (2,703) (16,641) 2,857 7,637 1,082,870

Amortization and provisions 24,792 4,118 (2,303) (5,292) 14 1,570 22,899

Net 440,877 621,933 (400) (11,349) 2,843 6,067 1,059,971

(*) Major acquisitions: DUFF & PHELPS: € 559,327 thousand and BANKWATCH: € 51,612 thousand.

Intangible assets at cost:

(EUR thousands) 1999 Acquisitions Disposals Changes Translation Merger 2000in scope of adjustment and other

consolidation

Start-up costs 2,037 652 (976) (116) 26 214 1,837

R&D costs 5,914 215 - 223 - 97 6,449

Patents, trademarks 313,774 1,384 (170) (13,695) (15) 14,331 315,609

Purchased goodwill 131,071 622,907 (8) (2,442) 2,797 (3,803) 750,522

Payments on account 2 407 - (2) - - 407

Other 12,871 486 (1,549) (609) 49 (3,202) 8,046

Total 465,669 626,051 (2,703) (16,641) 2,857 7,637 1,082,870

Amortization and provisions:


consolidation

Start-up costs 1,824 808 (973) (109) 28 78 1,656

R&D costs 5,892 232 - 172 - (19) 6,277

Patents, trademarks 6,391 1,143 (138) (4,832) 26 4,999 7,589

Purchased goodwill 1,477 1,064 (8) (223) (66) (257) 1,987

Other 9,208 871 (1,184) (300) 26 (3,231) 5,390

Total 24,792 4,118 (2,303) (5,292) 14 1,570 22,899

NOTE 5 - ANALYSIS OF BALANCE SHEET AND INCOME STATEMENT ITEMS

NOTE 5.1 - INTANGIBLE ASSETS

Movements in intangible assets:

NOTE 5.2 - PROPERTY, PLANT AND EQUIPMENT

Movements in property, plant and equipment:


consolidation

Cost 925,599 97,267 (21,831) (103,804) 12,779 (1,030) 908,980

Depreciation and provisions 543,539 65,151 (17,593) (66,646) 5,925 (803) 529,573

Net 382,060 32,116 (4,238) (37,158) 6,854 (227) 379,407

(*)

70 A n n u a l R e p o r t 2 0 0 0


Property, plant and equipment at cost:

(EUR thousands) 1999 Acquisitions Disposals Changes Translation Merger 2000in scope of adjustment and other

consolidation

Land 46,064 1,332 (218) (6,740) 1,642 191 42,271

Buildings and improvements 193,905 8,830 (3,218) (34,894) 2,287 325 167,235

Plant and equipment 482,423 52,792 (6,208) (42,784) 8,431 5,410 500,064

Leased plant and equipment 3,423 - - (618) - - 2,805

Other assets 186,003 22,562 (12,131) (17,027) 158 230 179,795

Other leased assets 51 - - - - - 51

Assets under construction 11,616 10,840 (8) (1,310) 272 (5,882) 15,528

Payments on account 2,114 911 (48) (431) (11) (1,304) 1,231

Total 925,599 97,267 (21,831) (103,804) 12,779 (1,030) 908,980

Depreciation and provisions:


consolidation

Land 807 50 - (417) 2 (9) 433

Buildings and improvements 82,669 9,902 (1,378) (20,451) 569 (277) 71,034

Plant and equipment 334,939 34,717 (5,316) (32,251) 5,241 (596) 336,734

Leased plant and equipment 3,090 70 - (355) - - 2,805

Other assets 122,006 20,400 (10,899) (13,166) 113 79 118,533

Other leased assets 23 12 - (1) - - 34

Assets under construction 5 (5) -

Total 543,539 65,151 (17,593) (66,646) 5,925 (803) 529,573

NOTE 5.3 - GOODWILL

Movements in goodwill:

(EUR thousands) Translation1999 Increase Decrease adjustment 2000

and other

Goodwill

Cost 597,593 61,999 (11,962) 5,942 653,572

Amortization 78,825 24,953 (2,748) (661) 100,369

Net 518,768 37,046 (9,214) 6,603 553,203

Goodwill at cost:

(EUR thousands) 1999 Increase Decrease Translation 2000 Accumulated Netadjustment amortization 2000

and other

FACOM (subsidiaries) 65,676 15,668 - - 81,344 (31,238) 50,106CASSINA 16,225 188 (1,593) - 14,820 (3,962) 10,858CLESTRA 10,369 - (10,369) - - - -FIMALAC INVESTISSEMENTS 288,853 34,373 - - 323,226 (11,839) 311,387(formerly STRAFOR FACOM)SOCIÉTÉ CADRES FACOM 8,225 - - - 8,225 (309) 7,916FITCH 98,510 4,712 - 6,442 109,664 (19,703) 89,961LBC 37,205 - - - 37,205 (17,664) 19,541FINANCIÈRE SECAP 44,072 1,797 - - 45,869 (8,324) 37,545SECAP 1,269 5,261 - - 6,530 (190) 6,340ENGELHARD-CLAL (subsidiaries) 500 - - (500) - - -Parent companies 26,689 - - - 26,689 (7,140) 19,549Total 597,593 61,999 (11,962) 5,942 653,572 (100,369) 553,203

71A n n u a l R e p o r t 2 0 0 0

The main acquisitions made in 2000 were as follows: FACOM subsidiaries: VIRAX (Public buyback offer) 2,249

FOG, TECALEMIT, ZIPPO 8,836

AUTO CONSULT 3,750

FIMALAC INVESTISSEMENTS: Public buyback offer 34,373

Badwill(EUR thousands) 1999 Increase Decrease 2000

FIMALAC S.A. 77,879 (15,515) 62,364

SECAP (subsidiaries) 62 (62) -

ENGELHARD-CLAL (subsidiaries) 1,180 (1,180) -

Other 12 - 12

Badwill 79,133 - (16,757) 62,376

NOTE 5.4 - INVESTMENTS

(EUR thousands) 1999 Increase Decrease Changes Translation Merger 2000in scope adjustment and other

of consolidation

Cost 123,001 32,352 (25,372) 15,017 1,820 (5,975) 140,843

Provisions 47,971 12,825 (13,201) (575) 1,900 (16) 48,904

Net 75,030 19,527 (12,171) 15,592 (80) (5,959) 91,939

Investments by category:

Net 2000 Net 1999

Investment in non-consolidated companies and other long-term investments (*) 66,221 68,022

Advances to non-consolidated companies 23,238 1,598

Loans 792 1,974

Other 1,688 3,436

91,939 75,030

The increase in Advances to non-consolidated companies primarily relates to the ENGELHARD-CLAL advance which was not

eliminated in the 2000 consolidated financial statements as the company was accounted for by the equity method

at December 31, 2000.

(*) Movements in investments in non-consolidated companies and other long-term investments can be analyzed as follows:

(EUR thousands) 1999 Increase Decrease Changes Translation Merger 2000in scope adjustment and other

of consolidation

Cost 102,642 30,797 (18,514) 3,609 1,775 (18,946) 101,363

Provisions 34,620 12,038 (13,201) (186) 1,871 0 35,142

Net 68,022 18,759 (5,313) 3,795 (96) (18,946) 66,221

Investments in non-consolidated companies:

Principal non-consolidated % Interest Shareholder’s equity 2000 Income Carryingcompanies at Dec. 31, 2000 value

FIMALAC & CIE 12.18% 170,597 6,047 45,987

45,987

72 A n n u a l R e p o r t 2 0 0 0


NOTE 5.5 - COMPANIES ACCOUNTED FOR BY THE EQUITY METHOD

(EUR thousands) Shareholders' equity Income At Dec. 31, At Dec. 31, at Dec. 31, 2000 2000 1999

FITCH - - 4,165 906

ENGELHARD-CLAL 190,024 46,378 92,998

BONGARD (disposal) - - - 1,424

CLAL DK (liquidated) - - - 1,342

Other - - - 67

Total 97,163 3,739

NOTE 5.6 - INVENTORIES AND WORK-IN-PROGRESS

(EUR thousands) Net Net2000 1999

Precious metals and raw materials 123,458 154,165

Work-in-progress 29,246 30,930

Finished products 101,052 94,289

Total 253,756 279,384

NOTE 5.7 - MARKETABLE SECURITIES


Cost 39,660 396,891

Provisions 2,926 2,906

Net 36,734 393,985

Stock market or fair value 36,740 398,733

Marketable securities primarily consist of money market securities.

NOTE 5.8 - ACCRUALS AND OTHER ASSETS


Other short-term receivables 65,985 76,394

Deferred charges 3,641 3,906

Prepaid expenses 15,118 12,378

Deferred tax assets (note 5.15) 83,923 61,739

Conversion losses 1,124 2,231

Total 169,791 156,648

Other investments in non-consolidated companies in an aggregate amount of € 20,234 thousand are as follows:

TEAM PARTNERS GROUP (*) 6,322

CASHWARE 3,348

BIOSPACE 1,372

CASSINA JAPON 1,399

NATURAL 777

LE MONDE PRESSE 1,175

Other 5,841

Total 20,234

(*) Based on average share price for the month of December 2000.

73A n n u a l R e p o r t 2 0 0 0

NOTE 5.9 - SHAREHOLDERS’ EQUITY

The share capital is made of 31,353,671 shares of common stock with a par value of € 4.4 each, all fully paid-up.

Changes in consolidated shareholders' equity in 1999 (Group share)

(EUR thousands)

Shareholders' equity at Dec. 31, 1998 664,674

Movements for the year:

Income for the year 71,361

Dividends paid (15,340)

Issuance of shares by the parent company 5,497

Translation adjustment 29,837

Treasury stock (18,073)

Other changes 281

Shareholders' equity at Dec. 31, 1999 738,237

Changes in consolidated shareholders' equity in 2000 (Group share)

(EUR thousands) Capital Additional Retained Income Cumulative Other Totalstock paid-in earnings for the year translation reserves shareholders’

capital adjustment equity

Shareholders’ equity at January 1, 2000 137,804 459,284 105,588 71,361 24,739 (60,539) 728,237

Movements for the year:

Change in capital 152 236 - - - - 388

Acquisition/disposal of treasury stock - - - - - 13,065 13,065

Income for the year - - - 99,972 - - 99,972

Dividends paid - (17,870) 68,158 (71,361) - - (21,073)

Translation adjustments - - - - (6,753) - (6,753)

Other (*) (6,277) - (907) - (7,184)

Shareholders’ equity at Dec. 31, 2000 137,956 441,650 167,469 99,972 17,079 (47,474) 816,652

(*) Including: Effect of change in method (new accounting standards) (9,066)Gains on disposals of treasury stock 1,276Change in consolidation method for ENGELHARD-CLAL (equity method) 907

Changes in consolidated shareholder’s equity (minority interests)

(EUR thousands) 2000 1999

Minority interests at January 1 56,107 4,205

Income for the year 4,351 975

Effect of changes in scope of consolidation and other changes (9,633) 51,096

Issuance of shares - 15

Translation adjustment (61) 419

Dividends paid (4,337) (603)

Minority interests at December 31 46,427 56,107

74 A n n u a l R e p o r t 2 0 0 0


NOTE 5.10 - QUASI-EQUITY

Perpetual subordinated debt

In 1992, FIMALAC INVESTISSEMENTS (formerly FACOM S.A.) obtained a perpetual subordinated loan in an amount

of € 152.4 million. An initial interest payment (zero coupon) of € 33.7 million was made immediately.

This amount bears interest.

The loan does not have a fixed maturity date and FIMALAC INVESTISSEMENTS does not have any repayment obliga-

tions, except following the occurrence of certain specific events including liquidation of the company.

In the case of liquidation of the company, the loan will be subordinate in ranking for repayment purposes to

all other debts of FIMALAC INVESTISSEMENTS.

In view of the characteristics of the loan, which is equivalent to equity, it is included in quasi-equity in an

amount of € 69.7 million, corresponding to the principal amount less the zero coupon and the interest earned

on the zero coupon.

Interest expense based on the original amount of the loan (€ 152.4 million), totaling € 7,741 thousand, is

recorded in the income statement, together with the interest income earned from the investment of the zero

coupon, in an amount of € 7,936 thousand.

NOTE 5.11 - PROVISIONS FOR CONTINGENCIES AND CHARGES


Provisions against metals 37,067 37,067

Provisions for contingencies and charges 249,460 267,577

Provisions for badwill 62,377 79,133

Total 348,904 383,777

Provisions for contingencies and charges cover the following principal risks: (EUR millions)

Industrial contingencies

Restructuring of hand tool division industrial facilities and logistics operations 81.3

Write-down of precious metals business assets 33.4

Pension obligations 39.5

Vendors' warranties 29.9

Other warranties 10.7

Customer risks 1.3

Provision for site decontamination costs 7.7

Relocation and demolition costs 1.5

Claims and litigation 0.9

Other provisions for contingencies and charges 43.3

Total 249.5

75A n n u a l R e p o r t 2 0 0 0

NOTE 5.12 - BANK BORROWINGS

By maturity


Amounts due within one year 569,799 530,732

Amounts due between one and five years 717,936 502,209

Amounts due beyond five years 45,959 46,292

Total 1,333,694 1,079,233

The increase in borrowings primarily results from the loans taken out to finance the public tender offer for DUFF

& PHELPS.

Bank borrowings are principally at variable rates. However, the Group hedged interest rate risks to obtain

a fixed rate of interest of approximately 34% of outstanding borrowings. A one point increase or decrease in

interest rates would have an impact of € 8.8 million on interest expense.

NOTE 5.13 - INTEREST INCOME AND EXPENSE


Interest income

Investment income 611 89

Income from other marketable securities 6,657 1,306

Other interest income 11,308 14,332

Reversals of provisions and expense transfers 1,055 2,055

Exchange gains 26,834 2,809

Net gains on disposals of marketable securities 10,222 28,787

Total 56,687 49,378

Interest expenseAmortization and provisions 14,074 1,060

Interest expense 102,623 45,112

Interest on debts under finance leases 167 101

Exchange losses 6,291 3,550

Net losses on disposals of marketable securities 870 30

Total interest expense 124,025 49,853

Net income/(loss) on joint ventures (51) 43

Interest expense, net (67,389) (432)

NOTE 5.14 - NON-RECURRING INCOME AND EXPENSE

(EUR thousands) Income Expense Net Net2000 1999

Income from/(expense on) revenue transactions 4,074 39,962 (35,888) (4,040)

Income from capital transactions 217,348 164,304 53,044 7,548

Reversals of/(charges to) provisions, expense transfers 74,894 60,891 14,003 29,137

Non-recurring income, net 296,316 265,157 31,159 17,549

Non-recurring items include: Amounts before tax (EUR millions)Gains on the sale of ANFA 36.3

Provision against precious metals business (10.5)

Vendors’ warranty on sale of 1% of ENGELHARD-CLAL (1.5)

Sale of 3.43% of FITCH in connection with the BANKWATCH acquisition 25.0

Other (18.1)

31.2

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NOTE 5.15 - INCOME TAX


Current taxes 40,145 48,399

Deferred taxes (9,777) (3,268)

Total 30,368 45,131

Income taxes on operating income after interest totaled € 30,526 thousand.

The average income tax rate for the year is 34%.

Net deferred taxes recorded in the balance sheet can be analyzed as follows:

2000 1999

Untaxed provisions (2,102) (8,394)

Depreciation and amortization (12,618) (7,641)

Fixed assets (5,133) -

Long-term capital gains (10,374) -

Other (51) 4,085

Provisions 70,565 53,408

Inventories 1,911 2,713

Transaction expenses/Deferred charges 7,354 (1,342)

Marketable securities - 955

Timing differences 6,325 7,092

Ordinary and evergreen tax losses 12,212 2,879

68,089 53,755

NOTE 5.16 - CONSOLIDATED SALES

Sales by business segment(EUR thousands) 2000 1999

FACOM

Hand tools 483,706 230,754Garage equipment 147,746 53,268

FITCH 241,409 158,469LBC 114,759 93,095SECAP 112,366 117,491CASSINA 101,173 46,475CLAL-MSX 62,814 49,732ENGELHARD-CLAL - 729,287CLESTRA 70,965 91,530

1,334,938 1,570,101Parent companies 1,459 9,454Total sales 1,336,397 1,579,555

Sales by geographic area(EUR thousands) 2000 1999

Euroland

France 463,807 469,423

Other 334,185 475,084

Rest of Europe 157,918 258,018

North America 292,281 270,441

Asia-Pacific 51,381 84,566

Other 36,825 22,023

Total sales 1,336,397 1,579,555

International sales, in % 65.3% 70.3%

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NOTE 5.17 - ANALYSIS OF 2000 OPERATING INCOME AND NET INCOME

(EUR thousands) Operating income Net income before minority interests Net income2000 1999 2000 1999 2000 1999

FACOM

Hand tools & garage equipment 69,819 32,862 31,172 14,923 30,697 14,899

FITCH 39,670 29,933 (6,598) 12,964 (6,611) 12,973

LBC 27,953 22,500 10,571 9,777 9,725 8,921

SECAP 17,288 17,985 38,780 10,637 38,459 10,630

CASSINA 13,147 5,056 6,919 2,253 5,354 2,150

CLAL-MSX 3,750 5,398 1,839 3,060 1,839 3,060

ENGELHARD-CLAL - 2,522 23,189 3,111 23,189 3,070

CLESTRA 2,250 3,033 734 498 647 468

173,877 119,289 106,606 57,223 103,299 56,171

Parent companies (16,602) (19,232) (2,283) 15,113 (3,327) 15,190

Total 157,275 100,057 104,323 72,336 99,972 71,361

NOTE 5.18 - SUBSEQUENT EVENTS

During March 2001, CASSINA acquired MELTIMI, a group of Italian companies specializing in lighting fixtures, and ALIAS,

a designer furniture manufacturer.

NOTE 5.19 - EMPLOYEES

The average number of employees for the year represents the total employees of fully consolidated companies and a

percentage of the employees of proportionally consolidated companies corresponding to the Group's percent interest.

2000 1999

Management 839 1,314

Supervisors 2,552 3,288

Emplyees and other 3,749 4,797

Total 7,140 9,399

The reduction in the average number of employees in 2000 is principally due to the use of the equity method to account

for ENGELHARD-CLAL, which was formerly proportionally consolidated.

NOTE 5.20 - REMUNERATION OF CORPORATE OFFICERS

Compensation payable to directors and officers in 2000 in remuneration of services rendered to the Group amounted

to € 4,354 thousand.

No loans or advances have been granted to directors or corporate officers by Group companies.

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NOTE 5.21 - OFF-BALANCE SHEET COMMITMENTS


COMMITMENTS GIVEN

Guarantees 608,355 169,271

Discounted bills - 752

Future minimum lease payments – equipment leases 2,529 2,487

Other commitments given 7,357 39,936

Collateralized debtsMortgages 14,625 14,625Pledges

UK Treasury gilts - 9,320

Pledged securities 586,000 648,900

Total commitments given 1,218,866 885,291

COMMITMENTS RECEIVED

Guarantees - 7,191

Other commitments received (1) 350,735 175,726

Total commitments received 350,735 182,917

(1) Including undrawn credit lines. 350,735 106,714

NOTE 5.22 - FINANCIAL FUTURES RISK

The Group uses financial instruments to hedge its exposure to interest rate and currency risks. No financial

instruments are used for speculative purposes.

• Hedging of interest rate risks

The Group uses swaps, forward rate agreements, collars and caps to hedge its exposure to interest rate risks.

• Hedging of currency risks and metals price risks

The financial instruments used include forward currency sales and purchases, forward metals sales and purchases,

currency options and currency swaps negotiated over-the-counter with first class counterparties.

NOTE 5.23 - CONTINGENCIES RELATED TO THE SWITCH TO THE EURO

Substantially all necessary changes were made in 1998. Budgeted expenses that have not yet been incurred are not

material.

Outstanding amounts at December 31, 2000

(EUR millions) Amount

Interest rate swaps 501.5

Caps 85.0

Collars 20.0

Forward rate agreements 50.0

Outstanding amounts at December 31, 2000

(EUR millions) Amount

Forward sales of foreign currencies 114.3

Forward purchases of foreign currencies 7.6

Forward sales of metals 2.4

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RE P O RT O F T H E A U D I T O R S

O N T H E C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S(year ended at December 31, 2000)

To the shareholders

In accordance with the terms of our appointment

by the Annual General Meeting, we have examined

the accompanying consolidated financial statements

of FIMALAC S.A. for the year ended December 31, 2000,

presented in euro.

These consolidated financial statements are the

responsibility of the Board of Directors. Our

responsibility is to express and opinion on these

financial statements based on our audit.

We conducted our audit in accordance with

professional standards applied in France. Those

standards require that we plan and perform our audit

to obtain reasonable assurance about whether

the financial statements are free of material

misstatement. An audit includes examining, on a

test basis, evidence supporting the amounts and

disclosures in the financial statements. An audit also

includes assessing the accounting principles used

and significant estimates made by management, as

well as evaluating the overall financial statement

presentation. We believe that our audit provides a

reasonable basis for our opinion.

In our opinion, the consolidated financial statements

present fairly the results of operations for the year

ended December 31, 2000 and the financial position

and assets of the Group at that date, in accordance

with French generally accepted accounting principles

including standard CRC 99-02.

We have also examined the information about the

Group given in the Directors' report. We are satisfied

that the information given in the Directors' report is

fairly stated and agrees with these consolidated

financial statements.

Paris, April 25, 2001

The Auditors

XAVIER AUBRY JACQUES CAGNAT

PARTNER OF BEFEC-PRICE WATERHOUSE CAGNAT & ASSOCIÉS

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CO M PA N Y F I N A N C I A L S TAT E M E N T S

Company

CONTENTS

Balance sheet

Statement of income

Notes to the financial statements

Reports of the Statutory Auditors

Resolutions

82

84

85

98

104

financial statementsin euro

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BA L A N C E S H E E T AT DE C E M B E R 31, 2000

FIXED ASSETS

Intangible assets - - - -

Property, plant and equipment

Land 1,214 - 1,214 1,346

Buildings 1,444 1,434 10 54

Other 2,589 2,532 57 82

Sub-total 5,247 3,966 1,281 1,482

Investments

Investments in subsidiaries and affiliates 1,632,080 45,091 1,586,989 1,447,805

Advances to subsidiaries and affiliates 22,867 - 22,867 54,683

Other long-term investments 67,276 11,875 55,401 59,414

Loans 10,789 - 10,789 21,596

Other non-current assets - - - -

Sub-total 1,733,012 56,966 1,676,046 1,583,498

Total I 1,738,259 60,932 1,677,327 1,584,980

CURRENT ASSETS

Inventories 45,365 271 45,094 44,307

Accounts receivable 62,447 1,574 60,873 15,413

Marketable securities 32,129 377 31,752 61,137

Cash 2,622 - 2,622 6,471

Prepaid expenses 1,430 - 1,430 -

Total II 143,993 2,222 141,771 127,328

Deferred charges 11,123 - 11,123 -

Translation adjustments - - - 9

Total assets 1,893,375 63,154 1,830,221 1,712,317

ASSETS Cost Amortization Dec. 31, 2000 Dec. 31, 1999depreciations

and provisions

(EUR thousands)

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LIABILITIES AND SHAREHOLDERS' EQUITY Dec. 31, 2000 Dec. 31, 1999

SHAREHOLDERS' EQUITY

Capital 137,956 137,804

Additional paid-in capital 442,328 459,962

Revaluation reserve - -

Reserves :

Legal reserve 13,780 13,105

Special long-term capital gains reserve 13,876 13,876

Other reserves 73,726 59,244

Retained earnings 2,228 5,789

Income for the year 26,724 14,800

Investment subsidies - -

Untaxed provisions 136 22,208

Total I 710,754 726,788

PROVISIONS FOR CONTINGENCIES AND CHARGES

Total II 40,954 31,301

LIABILITIES

Bank borrowings 674,634 668,767

Other borrowings 401,251 283,841

Accrued taxes and personnel costs 2,151 611

Other liabilities 477 489

Prepaid income - -

Total III 1,078,513 953,708

Translation adjustments - 520

Total liabilities and shareholders' equity 1,830,221 1,712,317

(EUR thousands)

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STAT E M E N T O F I N C O M E

(years ended at December 31)

(EUR thousands)

2000 1999

Operating incomeReal estate revenues 277 332

Metals lending 471 578

Metals sales - 7,513

Other revenues 20,339 988

Income from portfolio securities 54,212 22,335

Income from loans and other receivables 5,492 3,623

Net income from disposals of marketable securities 2,680 20,251

Other investment income 14,269 1,638

Reversals of provisions for contingencies and charges 4,434 2,320

Reversals of provisions against current assets 948 1,505

Reversals of provisions against marketable securities - 16

Total I 103,122 61,099

Operating expensesChange in inventories - 7,786

Taxes other than on income 168 1,009

Personnel costs 2,776 2,546

Other expenses 26,249 6,300

Amortization and depreciation 1,864 47

Charges to provisions against current assets - -

Charges to provisions against marketable securities 225 3

Charges to provisions for contingencies and charges 9,633 9,453

Interest expense 60,359 27,857

Net losses on disposals of marketable securities 504 29

Tax on operating income (17,844) (6,989)

Total II 83,934 48,041

Net operating income Total III (I-II) 19,188 13,058

Non-recurring incomeIncome from revenue transactions 50 32

Gains on disposals of investments 8,277 3,142

Reversals of provisions against investments 2,251 19

Reversal of untaxed provisions and subsidies written back to income 22,072 22,078

Reversals of provisions for contingencies and charges 263 2,801

Total IV 32,913 28,072

Non-recurring expenseExpenses on revenue transactions 1,131 23,231

Losses on disposals of investments 2,498 21

Charges to provisions against investments 12,638 170

Charges to provisions for contingencies and charges 4,717 1,862

Tax on non-recurring income 4,393 1,046

Total V 25,377 26,330

Non-recurring income, netTotal VI (IV-V) 7,536 1,742

Net incomeTotal VII (III+VI) 26,724 14,800

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NO T E S T O T H E F I N A N C I A L S TAT E M E N T S(in EUR thousands)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The financial statements of FIMALAC S.A. for the year ended December 31, 2000 have been prepared in

accordance with French generally accepted accounting principles (1999 general chart of accounts), including

the principles of prudence, consistency (except as explained in Note 1.1 below), segregation of accounting

periods and going concern.

In order to reflect more accurately the Company's operations, the presentation of the income statement differs

in some respects compared with that prescribed in the French general chart of accounts. The main differences

are as follows:

• The distinction between operating and investing activities has not been applied to the presentation of

operating income, in light of FIMALAC S.A.'s role as parent company.

• The proceeds from the disposal of investments have been netted off against the book value of the

investments, to show a net gain or loss, rather than presenting the disposal proceeds under income and the

book value of the investments as an expense.

• Changes in provisions for impairment in value of investments in subsidiaries and other investments are

qualified as non-recurring items and not as operating items.

• Since January 1, 1999 the Company's accounts have been kept in euro.

1) Significant events of the year

The highlights of the year were:

• The May 2000 public buyback offer for FACOM S.A. shares, with a view to acquiring 100% of FACOM S.A.'s capital either

directly or indirectly.

• The subscription of shares issued by FITCH INC. in connection with FITCH's acquisition of DUFF & PHELPS in

April 2000.

As a result of these transactions as well as FITCH INC's acquisition of DUFF & PHELPS the Company had to renegotiate

the syndicated loan obtain in 1999 in connection with the acquisition of FACOM S.A. Part of the related fee was

charged to FITCH INC. and the balance was recognized under « deferred charges » and is being amortized over the

period of the new loan. The expenses relating to the first syndicated loan were expensed in full in 1999. If these

expenses had been deferred in 1999, net income for 1999 would have increased by € 5 million.

Business developments

• the FACOM S.A. shares not already held by the Group were acquired for € 45.2 million,

• the Company underwrote an € 87.6 million capital increase by FITCH INC.,

• 1% of the capital of ENGELHARD-CLAL was sold, with the result that this company is no longer jointly controlled by

FIMALAC S.A. ,

• the Company acquired a 6.93% interest in TEAM PARTNERS GROUP,

• the Company acquired a 14.4% interest in CASHWARE,

• the Company sold 1.7% of its treasury stock on the open market for a total of € 16.8 million.

Results for the year

• the sale of FIMALAC S.A. shares generated a profit of € 6.55 million,

• the value of the ENGELHARD-CLAL subgroup (ENGELHARD-CLAL and CLAL US) has been maintained at the same

value as at December 31, 1999, after adjustment to exclude the business divested during the year, because of

the difficulty of estimating the price at which the remaining businesses and inventories are likely to be sold.

• the former CLAL, which was merged into FIMALAC S.A. in 1996, was subject to a tax audit for the period

between January 1, 1993 and December 31, 1995. Provision has been made for the uncontested tax deficiencies.

86 A n n u a l R e p o r t 2 0 0 0

NO T E S T O T H E F I N A N C I A L S TAT E M E N T S

2) Intangible fixed assets and property, plant and equipment

Fixed assets are stated at cost, with the exception of assets acquired before December 31, 1976, which are

stated at revalued cost.

Amortization and depreciation are calculated over the estimated useful lives of assets, as follows:

Software 1 year (Straight-line)

Buildings 20 years (Straight-line)

Plant and equipment 5 to 10 years (Reducing balance)

Fixtures and fittings, office furniture 10 years (Straight-line)

Vehicles and office equipment 5 years (Straight-line or, where permitted, Reducing balance)

3) Investments

Investments are stated at the lower of cost and market value. When book value is lower than cost, a charge

to provision for depreciation is made. The cost of investments acquired before December 31, 1976 corresponds

to revalued cost.

Investments are divided into three categories as follows:

• Investments in companies in which FIMALAC S.A. owns at least 10% of the capital and/or exercises significant

influence are classified as investments in subsidiaries and affiliates. Provisions for impairment in value are

determined based on the Company's equity in the underlying net assets (or revalued net assets), investment

yield, earnings yield and development potential.

• Advances to subsidiaries and affiliates. Provisions for impairment in value are determined based on the

financial position of the companies concerned.

• Other long-term investments, corresponding to investments in companies in which FIMALAC S.A. owns less

than 10% of the capital and/or in which the Company does not exercise significant influence.

A provision for impairment in value is recorded if the average December share price is less than cost in the case

of quoted securities, and if the probable realizable value is less than cost in the case of unquoted securities.

4) Inventories

Inventories, corresponding to fine metals at the raw material stage, are stated at the lower of cost and market

through a provision for depreciation when needed.

5) Receivables and debts

Receivables are stated at their nominal value. Provision is made when the fair value of receivables is less than

the book value.

Receivables and debts denominated in foreign currency are converted at the year-end exchange rate.

6) Marketable securities

A provision for impairment in value is recorded only in respect of securities for which the average stock market

price for the last month of the year in the case of quoted securities, or the net asset value at year-end, in the

case of pooled investment vehicles, is less than cost.

7) Deferred charges

Deferred charges consist of debt issuance costs and are amortized over the life of the debt.

8) Tax consolidation

A tax group was set up as of January 1, 1997 between FIMALAC S.A. and CLAL US, with FIMALAC S.A. as the head of

the group.

FINANCIÈRE SECAP and its subsidiaries (SECAP, SECAP INDUSTRIE, ANFA, SOPALIL and SFFEP) and MINERAIS & ENGRAIS have

been members of the tax group since January 1, 1998, LBC and CLAL-MSX have been members since January 1,

1999, and FACOM S.A. and its subsidiaries as well as LBC NANTES and LBC SOTRASOL have been members since

January 1, 2000.

Under the group relief agreement, each company in the tax group accounts for taxes as if it was taxed on a

stand-alone basis.

87A n n u a l R e p o r t 2 0 0 0

NOTE 2 - FIXED ASSETS

2.1 - MOVEMENTS IN FIXED ASSETS

Cost at Cost at(EUR thousands) Jan. 1, 2000 Acquisitions Disposals Dec. 31, 2000

Intangible assets - - - -Property, plant and equipment

Land 1,346 - (132) 1,214

Buildings and improvements 1,911 - (467) 1,444

Other 2,594 - (5) 2,589

Assets under construction - - - -Sub-total 5,851 - (604) 5,247Investments

Subsidiaries and affiliates 1,492,439 219,314 (79,673) 1,632,080

Advances to subsidiaries and affiliates 54,683 - (31,816) 22,867

Other long-term investments (1) 61,360 17,962 (12,046) 67,276

Loans 21,596 143,653 (154,460) 10,789

Other non-current assets 3 - (3) -Sub-total 1,630,081 380,929 (277,998) 1,733,012TOTAL 1,635,932 380,929 (278,602) 1,738,259

(1) Including FIMALAC S.A. shares representing 7.62% of the capital, acquired under the buyback program launched in November 1998, for € 48,645

thousand. Of the total, shares representing 0.42% of the capital held for allocation on exercise of employee stock options are carried in the balance

sheet under « Marketable securities ».

2.2 - AMORTIZATION AND DEPRECIATION

Balance at Balance at(EUR thousands) Jan. 1, 2000 Increase Decrease Dec. 31, 2000

Intangible assets - - - -

Buildings and improvements 1,857 8 (431) 1,434

Other property, plant and equipment 2,512 20 - 2,532TOTAL 4,369 28 (431) 3,966

2.3 - PROVISIONS FOR IMPAIRMENT IN VALUE

Balance at Balance at(EUR thousands) Jan. 1, 2000 Increase Decrease Dec. 31, 2000

Subsidiaries and investments 44,634 970 (513) 45,091

Other long-term investments 1,946 11,667 (1,738) 11,875

Loans - - - -TOTAL 46,580 12,637 (2,251) 56,966

NOTE 3 - DEFERRED CHARGES

Balance at Balance at(EUR thousands) Jan. 1, 2000 Increase Amortization Dec. 31, 2000

Debt issuance costs - 12,959 (1,836) 11,123

TOTAL - 12,959 (1,836) 11,123

As head of the tax group, the Company benefits immediately from any tax savings arising from utilization of

the tax losses of subsidiaries in the tax group and is required to pass on those savings to the subsidiaries

concerned when they return to profit.

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NOTE 6 - SHAREHOLDERS' EQUITY (EUR thousands)

6.1 - CAPITAL

At December 31, 2000, the Company's capital amounted to € 137,956 thousand, divided into 31,353,671

shares of common stock with a par value of € 4.40.

During the year:

• A five-for-one stock split was carried out, reducing the par value of the Company's shares from € 22 to

€ 4.40 and leading to the issuance of 25,055,316 shares.

• The capital was increased by € 152 thousand through the issuance of 34,526 shares on exercise of stock options.

At December 31, 2000, 2,521,807 FIMALAC S.A. shares representing 8.04% of the capital, were held in treasury

stock. The shares were acquired under the buyback program launched in November 1998.

6.2 - ADDITIONAL PAID-IN CAPITAL AND RESERVES

The net decrease in additional paid-in capital from € 459,962 thousand to € 442,328 thousand corresponds

to premiums on shares issued on exercise of stock options less the amount transferred to the « treasury stock

reserve » in accordance with the decision of the Annual General Meeting of June 7, 2000 (third resolution).

The changes in the « Legal reserve », the « Long-term capital gains reserve » and « Retained earnings »

correspond to appropriations decided at the Annual General Meeting of June 7, 2000 (second resolution).

NOTE 4 - INVENTORIES

Balance Balance(EUR thousands) at Dec. 31, 2000 at Dec. 31, 1999

Value of metal inventoriesCost 45,365 45,365

Provisions (271) (1,058)Net 45,094 44,307

Inventories correspond to precious metals previously used by the CLAL parent company which was merged into

FIMALAC S.A. in 1996. They are being leased to various credit institutions.

FIMALAC S.A. has set up a hedging program based on forward sales to reduce its exposure to market risks resulting

from fluctuations in prices of precious metals. These forward sales cover total precious metals inventories.

The Company also took out a gold-indexed loan in 1996. The balance outstanding on this loan at December 31,

2000 was € 5,997 thousand.

The terms of repayment of the loan constitute a hedge of equivalent gold inventories.

The valuation of inventories takes account of these hedging transactions.

NOTE 5 - ACCOUNTS RECEIVABLE

MATURITIES

Gross Due Due(EUR thousands) within one year beyond one year

Non current assetsAdvances to subsidiaries and affiliates 22,867 4,573 18,294Loans 10,789 691 10,098Current assetsPayments on account 32 32 -Trade accounts receivable 2,428 513 1,915Receivables from Group companies 55,914 55,914 -Prepaid and recoverable taxes 2,847 2,305 542Other receivables 1,226 972 254TOTAL 96,103 65,000 31,103

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Grantor Date of Exercise period Number of options Board meeting outstanding

FIMALAC S.A. 10/14/93 from June 18, 1997 to Oct. 15, 2001 3,065

Ex-ALSPI 10/14/93 from June 18, 1997 to Oct. 15, 2001 41,830

Ex-ALSPI 06/22/95 by tranche up to June 22, 2003 47,886

FIMALAC S.A. 06/18/97 by tranche up to June 18, 2003 21,955

Ex-CENTENAIRE BLANZY 06/18/97 by tranche up to June 18, 2003 125,258

FIMALAC S.A. 12/17/98 by tranche up to December 17, 2004 127,229

FIMALAC S.A. 05/28/99 by tranche up to May 28, 2005 5,020

Total number of subscription options exercisable for one share 239,994

Total number of purchase options exercisable for one share 132,249

The exercise of all outstanding options would result in a 0.77% capital increase.

6.3 - STOCK OPTION PLANS

The Company has granted stock options to certain officers and managers and has also taken over obligations

of ALSPI and CLAL (absorbed in 1996) and CENTENAIRE BLANZY (absorbed in 1998) under those companies' stock

option plans, subject to adjusted conditions of grant.

The number of options granted has been adjusted to reflect the 5-for-1 stock split of June 13, 2000.

At December 31, 2000, the situation was as follows:

6.4 - INVESTMENT SUBSIDIES AND UNTAXED PROVISIONS

Balance Increase Decrease Balanceat at

(EUR thousands) Jan. 1, 2000 Dec. 31, 2000

Investment subsidies - - - -

Untaxed provisions

Reinvested capital gains (article 40 of the French General Tax Code) 136 - - 136

Provision for commodity price fluctuations 22,056 - (22,056) -

Provision for inventory price increases 16 - (16) -

Sub-total 22,208 - (22,072) 136

Total 22,208 - (22,072) 136

Part of the provision for commodity price fluctuations was reversed in accordance with a Ministry of Finance

agreement dated January 31, 1995, as amended on March 29, 1996 and April 15, 1997.

In accordance with the terms of this agreement, the balance of the provision carried in the balance sheet at

December 31, 1999 was reversed in its entirety at December 31, 2000.

90 A n n u a l R e p o r t 2 0 0 0


NOTE 8 - DEBTS

MATURITIES

Gross Due Due between one Due beyond(EUR thousands) within one year and five years five years

Bank borrowingsBank loans 669,186 455,451 213,735 -Accrued interest 5,448 5,448 - -Other liabilitiesDeposits and guarantees received 4 4 - -Other debts 305 305 - -Due to group companies 400,942 400,942 - -Accrued taxes and personnel costs 2,151 2,151 - -Other liabilities 477 477 - -TOTAL 1,078,513 864,778 213,735 -

The Company obtained a new syndicated loan to finance the tender offer for DUFF & PHELPS and the public buyback

of the remaining FACOM S.A. shares. The amount of the facility, converted at the December 31, 2000 exchange rate,

is € 1,030.4 million.

FITCH INC. has drawn down $ 400 million from this facility. The remaining € 586 million is available for use by FIMALAC S.A.

As of December 31, 2000, total draw-downs stood at € 281 million.

The Company has also obtained a loan for which repayment are indexed on the gold price. As of December 31, 2000

the balance outstanding on this loan was € 6 million The indexation clause operates as a hedge on the Company's

gold inventory (see note 4). Since these positions are symmetrical, no gains or losses on the loan indexed on the

gold price are accounted for.

Bank borrowings are at variable rates. Part of the interest rate risk on these borrowings is hedged by the

following instruments:

• fixed rate swap on € 206 million,

• cap on € 85 million,

• a collar with a 5.5% cap on € 20 million.

In addition, the 6-month Euribor has been swapped for the 6-month Stibor on an amount of € 77 million

through June 21, 2004.

Finally, a swap contract has also been set up on € 30 million.

A one point increase or decrease in interest rates would have the effect of increasing or reducing interest

expense by € 3.7 million.

NOTE 7 - PROVISIONS FOR CONTINGENCIES AND CHARGES

Balance at Increase Decrease Balance at (EUR thousands) Jan. 1, 2000 Dec. 31, 2000

Provisions for contingencies and chargesProvision for pension obligations and statutory retirement bonuses 6,600 9,590 (755) 15,435

Provision for taxes 1,458 - (58) 1,400

Rent deposits 95 - (95) -

Decontamination of leased former industrial sites 8,387 - (1,069) 7,318

Customer risks 138 - - 138

Financial risks 624 - (624) -

Real estate risks 275 - (205) 70

Industry risks 6,788 610 (762) 6,636

Taxes (tax group –see note 13-1) 2,150 1,818 - 3,968

Other contingency provisions 4,786 2,331 (1,128) 5,989 Total 31,301 14,349 (4,696) 40,954

« Provision for pension obligations and statutory retirement bonuses » includes the Company's obligations for

pensions payable to former Group managers and their assignees, as well as future obligations towards current

officers and managers.

91A n n u a l R e p o r t 2 0 0 0

NOTE 10 - STATEMENT OF INCOME: OPERATING INCOME

Operating income increased from € 61,099 thousand in 1999 to € 103,122 thousand in 2000, reflecting:

• the absence of metal sales in 2000 as opposed to € 7,513 thousand in sales in 1999;

• a € 19,351 thousand increase in other revenues, principally due to the recharging and capitalization of debt

issuance costs;

• a € 17,571 thousand decline in net gains on disposals of marketable securities, due to a reduction in cash

reserves;

• an increasse in other investment income to € 14,269 thousand from € 1,638 thousand in 1999;

• the increase in income from portfolio securities (as analyzed below).

Income from portfolio securities rose to € 54,212 thousand in 2000 from € 22,335 thousand in 1999,

as follows:


FIMALAC INVESTISSEMENTS (EX-FACOM) 24,455 14,907

LBC 4,128 3,494

MINERAIS & ENGRAIS 6,857 3,251

CLAL US - 561

CLAL-MSX 459 -

FINANCIÈRE SECAP 18,142 -

Long-term investments 47 6

Marketable securities 124 116

54,212 22,335

Loan interests, mainly from loans to subsidiaries, rose to € 5,492 thousand in 2000 from € 3,623 thousand in 1999.

After-tax operating expenses totaled € 83,934 thousand compared with € 48,041 thousand in 1999 and mainly

included:

• other expenses for € 26,249 thousand versus € 6,300 thousand in 1999, reflecting debt issuance costs;

• interest expense of € 60,359 thousand versus € 27,857 thousand in 1999;

• net expenses on disposals of marketable securities totaling € 504 thousand;

• amortization, depreciation and provision expense of € 11,722 thousand.

Tax on operating income increased to € 17,844 thousand from € 6,989 thousand, reflecting the impact of the tax

consolidation.

NOTE 9 - MARKETABLE SECURITIES

See also « LIST OF INVESTMENTS »

(EUR thousands) Book value Fair value

At January 1, 2000 61,296 61,216Acquisitions for the year 1,074,490 -Disposals for the year (1,103,657) -At Dec. 31, 2000 32,129 31,752

Marketable securities at December 31, 2000 include 132,249 FIMALAC S.A. shares, representing 0.42% of capital,

acquired at a cost of € 2,656 thousand, that are being held for allocation on exercise of stock options. The

shares have been written down by € 153 thousand.

92 A n n u a l R e p o r t 2 0 0 0


NOTE 13 - INCOME TAX

13.1 - INCOME TAX ANALYSIS

Net income Operating income after interest Non-recurring income(EUR thousands) Tax rate Tax rate Tax rate Tax rate

of 33.33% of 19% of 33.33% of 19%

Income before tax 13,273 1,344 - 12,869 (940)Income tax 13,451 17,844 - (4,590) 197Net income 26,724 19,188 - 8,279 (743)

19,188 7,536

The above amounts include the 10% surtax and the 3.3% social fund contribution. The tax due on non-recurring

income taxed at 33.33% includes tax savings arising from tax consolidation. A € 3,968 thousand provision has been

recorded under « provisions for contingencies and charges » to cover tax benefits to be passed on by FIMALAC S.A., to

loss-making subsidiaries when they return to profit.

NOTE 12 - RELATED PARTY TRANSACTIONS

(EUR thousands)

Balance sheet Assets Liabilities

Investments in subsidiaries and affiliates 1 627,360

Advances to subsidiaries and affiliates 22,867

Other non-current assets 10,788

Other receivables 56,262

Borrowings 400,942

Statement of income Expenses Income

Real estate revenues 32

Other revenues 7,369

Income from subsidiaries and affiliates and other long-term investments 54,041

Income from advances to subsidiaries and affiliates 1,453

Income from loans and other receivables 3,831

Reversals of provisions for impairment in value of investments 513

Other expenses 2,313

Interest expense 14,767

Charges to provisions for impairment in value of investments 970

NOTE 11 - STATEMENT OF INCOME: NON-RECURRING ITEMS (EUR thousands)

Non-recurring income primarily comprised:

• capital gains on real estate disposals for € 536 thousand,

• capital gains on disposal of investments for € 5,243 thousand,

• reversals of provisions against investments for € 2,251 thousand,

• € 22,072 thousand released from provisions for commodity price fluctuations and inventory price increases.

Non-recurring expense included:

• € 1,131 thousand in expenses from revenue transactions, mainly representing costs incurred in connection

with the public buyout procedure concerning FACOM S.A.,

• € 4,717 thousand in charges to provisions for contingencies and charges,

• € 12,638 in charges to provisions against investments,

Tax on non-recurring income in an amount of € 4,393 thousand.

13.2 - UNRECOGNIZED DEFERRED TAXES

Nature of timing differences (EUR thousands) Assets Liabilities

Unrecognized deferred tax assetsIncome taxed in current year, not yet accounted for

Unrealized gains on pooled investment vehicles - -Charges for the year, deductible in subsequent years

Social fund contribution 4 -

Unrecognized deferred tax liabilitiesUntaxed provisions - -

Items taxable on disposal of assets

Capital gains on which taxation has been deferred (former CLAL) 10,200

(ENGELHARD-CLAL and CLAL-MSX shares)

Merger gains (former ALSPI) 81(Mulhouse land)

Unrecognized deferred tax assets and liabilities have been calculated at the standard income tax rate plus the

6% surtax and the 3.3% social fund contribution

NOTE 14 - OFF-BALANCE SHEET COMMITMENTS

(EUR thousands)

Commitments received Guarantees received 586,000

Interest rate and foreign currency transactions 446,895

Forward metal sales 46,500

Undrawn credit lines 350,735

Other 3

Commitments givenGuarantees in favor of Group companies 557,879

Interest rate and foreign currency transactions 446,895

Forward metal sales 45,093

Pledged securities 586,000

Other 12,372

93A n n u a l R e p o r t 2 0 0 0

NOTE 15 - REMUNERATION OF DIRECTORS AND OFFICERS

(EUR thousands)

Board of Directors 166

Corporate officers 1,484

NOTE 16 - AVERAGE NUMBER OF EMPLOYEES

Average number Employees loanedof employees to the company

Management 2 -

Employees - -

Total 2 -

NOTE 17 - SUBSEQUENT EVENTS

No significant events have occurred since the beginning of 2001.

94 A n n u a l R e p o r t 2 0 0 0


NOTE 18 - SUBSIDIARIES AND AFFILIATES

(EUR thousands)

Company Capital stock Reserves

A - Investments with a book value in excess of 1% of the capital of FIMALAC S.A.

1) Subsidiaries (at least 50%-owned)

CLAL-MSX S.A. 2,294 14,549

11, rue du Menillet - Bornel - 60540 Meru

CLAL US EURL 14,918 343

97, rue de Lille - 75007 Paris

FIMALAC INVESTISSEMENTS 43,786 328,732


FINANCIÈRE SECAP S.A. 29,212 82,150

21, quai Alphonse-le Gallo - 92100 Boulogne Billancourt

LBC S.A. 63,504 65,219

5 ter, rue du Dôme - 75116 Paris

MINERAIS & ENGRAIS S.A. 243,980 196,029

97, Rue de Lille - 75007 Paris

RHENAMECA S.A. 22,728 (2,890)


SOCIÉTÉ DE CADRES FACOM 2,160 1,694


2) Affiliates (10% to 50%-owned)

ENGELHARD-CLAL SAS 66,727 99,415

8, rue Portefoin - 75003 Paris

B - Other subsidiaries and affiliates

1) Subsidiaries not included in section A

French subsidiaries - -

Foreign subsidiaries - -

2) Affiliates not included in section A

French affiliates - -

Foreign affiliates - -

(*) Including investment income.

95A n n u a l R e p o r t 2 0 0 0

% interest Book value of investment Outstanding loans Guarantees 2000 sales 2000 Dividendsgranted by provided by net income/ received

Cost Net FIMALAC S.A FIMALAC S.A. (loss) in 2000

99.96% 7,517 7,517 - - 62,764 (*) 1,518 459

100.00% 14,864 14,864 - - 218 (*) (208) -

97.26% 933,197 933,197 - - 25,913 (*) 14,922 24,455

99.37% 68,148 68,148 - - 34,510 (*) 33,941 18,142

99.99% 113,747 113,747 34,177 518 12,146 (*) 7,437 4,128

99.99% 295,070 295,070 - - 20,480 (*) 15,194 6,857

99.99% 25,250 19,837 - - 2,776 (*) 758 -

99.99% 12,027 12,027 8,196 - 543 (*) 161 -

49.00% 69,246 29,628 22,867 4,573 1,309,854 47,154 -

- 2,059 1,999 10,098 - - - -

- - - - - - - -

- 3,348 3,348 - - - - -

- 87,607 87,607 - 102,095 - - -

96 A n n u a l R e p o r t 2 0 0 0

LI S T O F I N V E S T M E N T S

(EUR thousands)

Number Bookof securities value

1) Principal investmentsI) Subsidiaries and affiliates

Listed - -

Unlisted

BIOSPACE 2,455 1,372

CASHWARE 8,857 3,348

CLAL-MSX 15,043 7,516

CLAL US 97,500 14,864

ENGELHARD-CLAL 3,574,569 29,629

FCBS GIE 4,499,991 626

FINANCIÈRE SECAP 1,814,207 68,148

FIMALAC INVESTISSEMENTS (EX-FACOM S.A.) 10,646,197 933,197

FITCH INC. 824,738 87,607

LBC 4,165,593 113,747

MINERAIS & ENGRAIS 5,082,776 295,070

RHENAMECA 2,525,294 19,838

SEFI 99 -

SOCIÉTÉ DES CADRES FACOM 119,994 12,027

Total A 1,586,989

II) Other long-term investments

Listed

FIMALAC 2,389,558 48,645

TEAM PARTNERS GROUP 243,498 6,321

Unlisted

SA.RE.LI 2,377 36

UCEPART 215 342

Total B 55,344

III) Marketable securities

Listed

FIMALAC 132,249 2,504

Unlisted

SPECIALIST FUNDS 21,837

LILLE ROYALE 500,195 7,411

Total C 31,752

Total A + B + C 1,674,085

2) Investments with a book value of less than € 15 thousand 56

Carrying value 1,674,141

97A n n u a l R e p o r t 2 0 0 0

FI V E -Y E A R F I N A N C I A L S U M M A RY

(Articles 133, 135 and 148 of decree n° 67.236)(in EUR)

Description 1996 1997 1998 1999 2000

I) Capital at December 31

a) Capital 106,194,400 109,881,273 131,045,026 137,804,238 137,956,152

b) Number of shares issued (*) 4,975,640 5,148,385 6,139,993 6,263,829 31,353,671

c) Number of convertible bonds - - - - -

d) Number of stock options (*) 341,433 172,438 178,525 54,689 239,994

II) Results of operations

a) Operating revenues (excluding VAT) 57,232,404 45,729,657 73,361,376 57,257,808 84,778,080

b) Income before tax, amortization, depreciation 22,524,499 12,900,636 3,260,298 (8,347,644) 12,380,230and provision expense

c) Income tax 10,690,076 17,786,172 19,754,611 (5,943,786) (11,633,452)

d) Net income 29,194,869 12,730,678 19,424,724 14,800,231 26,723,953

e) Distributed income 12,136,503 13,342,726 16,884,981 23,301,444 28,218,304

III) Earnings per share

a) Income after tax, but before amortization, 2.38 (0.95) (2.69) (0.38) 0.77depreciation and provision expense

b) Net income 5.87 2.47 3.16 2.36 0.85

c) Distributed income 2.44 2.59 2.75 3.72 0.90

IV) Personnel

a) Number of employees at Dec. 31 1 2 5 5 2

b) Total payroll 333,493 645,741 1,011,330 1,877,148 2,245,349

c) Total benefits 244,941 345,474 454,658 668,421 530,295

(*) Five-for-one stock split in June 2000.(**) Dividend recommended for approval by the Annual General Meeting.

(**)

(**)

98 A n n u a l R e p o r t 2 0 0 0

STAT U T O RY AU D I T O R S ’ RE P O RT GE N E R A L RE P O RT

(Year ended Dec 31, 2000)

To the shareholders

In accordance with the terms of our appointment by

the Annual General Meeting, we hereby submit our

report for the year ended December 31, 2000 on:

- our examination of the financial statements of

FIMALAC S.A., in euro, as attached to this report,

- the specific procedures and information required

by law.

These financial statements are the responsibility of

the Board of Directors. Our responsibility is to express

an opinion on these financial statements based on

our audit.

1. OPINION ON THE FINANCIAL STATEMENTS

We conducted our audit in accordance with

professional standards applied in France. Those

standards require that we plan and perform our audit

to obtain reasonable assurance about whether

the financial statements are free from material

misstatement. An audit includes examining, on a

test basis, evidence supporting the amounts and

disclosures in the financial statements. An audit also

includes assessing the accounting principles used

and significant estimates made by management, as

well as evaluating the overall financial statement

presentation. We believe that our audit provides a

reasonable basis for our opinion.

In our opinion, the financial statements present fairly

the results of operations for the year ended December

31, 2000 and the financial position and assets of the

Company at that date, in accordance with French

generally accepted accounting principles.

Without qualifying the opinion expressed above,

we draw your attention to note 1.1 to the financial

statements, which explains a change in method of

accounting for debt issuance costs.

2. SPECIFIC PROCEDURES AND INFORMATION

We have also performed the specific procedures

required by law, in accordance with professional

standards.

We are satisfied that the information given in

the Directors' report and the documents sent to

shareholders on the financial position and financial

statements is fairly stated and agrees with those


In accordance with the law, we have verified that all

information concerning acquisitions of shareholdings

and controlling interests and the identity of

shareholders is given in the Directors' report.


The Auditors


PARTNER – BEFEC-PRICE WATERHOUSE CAGNAT & ASSOCIÉS

99A n n u a l R e p o r t 2 0 0 0

STAT U T O RY AU D I T O R S ’ RE P O RT SP E C I A L RE P O RT

(Year ended Dec 31, 2000)

To the shareholders

In our capacity as Auditors of FIMALAC S.A., we are

required to report to shareholders on agreements

involving directors.

In application of Article L 225-40 of the Commercial

Code we have been informed of the agreements

authorized in advance by the Board of Directors.

Our responsibility does not include identifying any

undisclosed agreements. We are required to report

to shareholders, based on the information provided,

about the main terms and conditions of agreements

that have been disclosed to us, without commenting

on their relevance or substance. Under the provisions

of Article 92 of the decree of March 23, 1967, it is the

responsibility of shareholders to determine whether

the agreements are appropriate and should be

approved.

We conducted our review in accordance with the

standards of the profession in France. Those

standards require that we carry out the necessary

procedures to verify the consistency of the

information disclosed to us with the source

documents.

AGREEMENTS AUTHORIZED DURING THE YEAR

Director concerned: Bernard Pierre

During the meeting of September 21, 2000, the

Board of Directors authorized the Company to sell to

Bernard Pierre 1% of the capital of ENGELHARD-CLAL SAS

and ENGELHARD-CLAL LP, the companies forming the

ENGELHARD-CLAL joint-venture, for FRF 8 million. The

agreement contains a price review clause, applicable

if Bernard Pierre were to realize a capital gain on

disposal or cancellation of these shares within a

period of three years.

In application of the decree of March 23, 1967 we were

also informed of the agreements entered into during

prior years which remained in force in 2000.

AGREEMENTS ENTERED INTO DURING PRIOR

YEARS WHICH REMAINED IN FORCE IN 2000

Agreements with Michel Castres Saint-Martin and

Bernard Mirat

As members of the audit committee, Michel Castres

Saint-Martin and Bernard Mirat each received

additional fees of FRF 10,000.

Agreement with FIMALAC & CIE

The trademark sub-licensing agreement to permit the

Company to adopt its new corporate name remained

in force during the year ended December 31, 2000.

No fees are paid under this sub-license.

Agreement with F.C.B.S. GIE (Groupement d'Intérêt

Economique)

The Company is a member of the F.C.B.S. GIE, the

purpose of which is to fund the Group's central

services and provide the resources required to

facilitate and improve the business and results of

members. The fee paid by the Company in this respect

totaled € 2,312,909.14 (including non recoverable

VAT).

Agreement with the French subsidiaries of

the Company and FIMALAC INVESTISSEMENTS' foreign

subsidiaries

Cash pooling agreement according to which the

Company manages the Group's cash in line with

market conditions.


The Auditors


PARTNER – BEFEC-PRICE WATERHOUSE CAGNAT & ASSOCIÉS

ANNUAL AND EXTRAORDINARY GENERAL MEETING

(June 5, 2001)

100 A n n u a l R e p o r t 2 0 0 0

RESOLUTIONS TO BE VOTED ON

IN ANNUAL GENERAL MEETING

1. Approval of the Director's Report and the

Statutory Auditors' general report and the

financial statements for the year ended December

31, 2000. Presentation of the consolidated


2. Appropriation of net income.

3. Approval of agreements involving directors.

4. Ratification of the appointment of Véronique

Morali.

5. Re-election of Georges Charpak as Director.

6. Re-election of Bernard Pierre as Director.

7. Election of BANQUE FÉDÉRATIVE DU CRÉDIT MUTUEL

as Director.

8. Election of René Barbier de la Serre as Director.

9. Election of Henri Lachmann as Director.

10. Election of Jean-Charles Naouri as Director.

11. Election of Edouard de Royère as Director.

12. Determination of Directors' attendance fees.

13. Authorization to buy back shares.

RESOLUTIONS TO BE VOTED ON

IN EXTRAORDINARY GENERAL

MEETING

14. Amendment of the maximum number of

Directors and consequent amendment of article 13

of the Company’s bylaws relating to the Board of

Directors.

15. Amendment of the age limit for directors

and consequent amendment of article 14 of the

Company’s bylaws relating to Directors’ terms of

office, re-election and replacement.

16. S i m p l i f i c a t i o n o f C o m p a n y n a m e a n d

consequent amendment of article 3 of the bylaws

relating to the Company’s name.

17. Powers to carry out formalities.

101A n n u a l R e p o r t 2 0 0 0

The Annual General Meeting of June 7, 2000 approved

a five-for-one stock split.

Statutory Auditors' special report (Third resolution)

Shareholders are invited to approve the agreements

referred to in the Statutory Auditors' special report.

Approval of the appointment of Véronique Morali as

Director (Fourth resolution)

Shareholders are asked to note the resignation

from the board of FIMALAC & CIE and to ratify the

appointment as Director of Véronique Morali at

the Board of Directors' meeting of April 24, 2001.

Re-election of Directors (Fifth and sixth resolutions)

The terms of office of Georges Charpak and Bernard

Pierre are due to expire at the end of the Annual

General Meeting. The Board of Directors recommends

that these directors be re-elected for a further four-

year term, as stipulated in Article 14 of the Company's

bylaws.

Election of new Directors

(Seventh to eleventh resolutions)

The Board of Directors recommends that five new

directors elected be appointed for a four-year period,

all of whom were previously members of the Board of

Directors of FIMALAC INVESTISSEMENTS (formerly FACOM

S.A.), provided that the fourteenth resolution is

adopted: BANQUE FÉDÉRATIVE DU CRÉDIT MUTUEL, René

Barbier de la Serre, Henri Lachmann, Jean-Charles

Naouri and Edouard de Royère.

Determination of Directors' attendance fees

(Twelfth resolution)

Directors' attendance fees for 2000 were fixed at

€ 152,500, the same amount as in 1999. The Board of

Directors recommends that Directors' attendance fees

for 2001 should be increased to € 201,305.

Approval of the financial statements

(First resolution)

Shareholders are invited to approve the Directors'

Report, the Statutory Auditors' general report and the

financial statements for the year ended December 31,

2000 and to place on record that consolidated

financial statements have been presented.

Appropriation of net income

(Second resolution)

The Board of Directors recommends that net income

be appropriated as follows:

Origines

Net income for the year EUR 26,723,952.56

Retained earnings brought forward EUR 2,228,343.24from prior year

Transfer from merger premium EUR 3,797,187.16

Transfer from revenue reserves EUR 11,705,014.24

Transfer from “Treasury stock reserve” EUR 10,567,871.70(distributable amount)

Total EUR 55,022,368.90

Appropriations

Legal reserve (long-term capital gains) EUR 15,191.44

Long-term capital gains reserve EUR 26,788,873.56

Statutory dividend EUR 6,897,807.62

Additional dividend EUR 21,320,496.28

Total EUR 55,022,368.90

The total dividend will amount to € 28,218,303.90

The net dividend payable on each of the 31,353,671

shares outstanding and carrying rights to the 2000

dividend will amount to € 0.90.

Including the tax credit of € 0.45 attributable to

shareholders eligible for a 50% credit, the total

revenue per share will amount to € 1.35.

The dividend will be payable from June 7, 2001.

Dividends on shares held in treasury stock at that date

will be credited to retained earnings, following

determination by the Board of Directors of the number

of shares concerned.

Dividends for the last three years were as follows

(information provided in accordance with Article 243

bis of the French Tax Code):

SUMMARY OF RESOLUTIONS PRESENTED

AT THE ANNUAL GENERAL MEETING(June 5, 2001)

Year Net dividend Tax credit Gross(EUR) (50%) dividend

1997 2.59 1.30 3.89

1998 2.75 1.375 4.125

1999 3.72 1.86 5.58

102 A n n u a l R e p o r t 2 0 0 0

Authorization to buy back shares

(Thirteenth resolution)

In accordance with article L 225-209 of the

Commercial Code, the Board of Directors is seeking an

eighteen-month authorization to purchase FIMALAC

shares representing a maximum of 10% of the

Company's capital. According to this authorization

shares may be purchased on one or more occasions by

any appropriate means, on the open market or

otherwise, including by block purchases and the use

of derivative instruments, including put options and

the issuance of negotiable bills. The shares would

be acquired, inter alia, to stabilize the share price,

to purchase or sell shares based on market

opportunities, to grant stock options to officers and

employees of the Company and/or its subsidiaries,

or for retention or transfer, by any appropriate

method, including in exchange for shares of another

company.

The Board of Directors recommends that the

maximum purchase price per share should be € 55

and the minimum sale price per share € 30.

The information memorandum concerning the

Company’s purchase of its own shares approved by

the Commission des Opérations de Bourse is available

upon request from the Company's headquarters.

SUMMARY OF RESOLUTIONS PRESENTED

AT THE ANNUAL GENERAL MEETING

103A n n u a l R e p o r t 2 0 0 0

REPORT OF THE BOARD OF DIRECTORS

ON THE RESOLUTIONS PRESENTED

AT THE EXTRAORDINATY ANNUAL GENERAL MEETING(June 5, 2001)

Amendment of the maximum number of Directors

(Fourteenth resolution)


maximum number of directors be increased from

twelve to twenty four, in accordance with the law.

Amendment of the age limit for Directors

(Fifteenth resolution)


maximum age limit for directors be increased from 76

to 80 years of age.

Simplification of Company name

(Sixteenth resolution)


Company's name be changed to « FIMALAC ».

Powers to carry out formalities

(Seventeenth resolution)

The Board of Directors is requesting that full powers

be given to carry out all the formalities relating to this

Meeting.

104 A n n u a l R e p o r t 2 0 0 0

R E S O L U T I O N S P R E S E N T E D AT T H E AN N U A L

A N D EX T R A O R D I N A RY GE N E R A L ME E T I N Gof June 5, 2001

RESOLUTIONS TO BE VOTED ONIN ANNUAL GENERAL MEETING

First resolution

(Approval of the Director's report

and the Statutory Auditors' general report

and the financial statements for the year ended

December 31, 2000. Presentation of consolidated

financial statements.)

The Annual General Meeting, having heard

the Directors’ report and the Statutory Auditors’

report approves the financial statements for

the year ended December 31, 2000 showing net

income of EUR 26,723,952.56, together with the

transactions reflected therein, and places on record

the fact that the consolidated financial statements

for the year have also been presented.

Second resolution

(Appropriation of net income)

The Annual General Meeting approves the

recommendation of the Board of Directors concerning

the appropriation of net income for the year,

as follows:

IncomeNet income for the year EUR 26,723,952.56Retained earnings brought forward from prior year EUR 2,228,343.24Transfer from merger premium EUR 3,797,187.16Transfer from revenue reserves EUR 11,705,014.24Transfer from “Treasury stock reserve”(distributable amount) EUR 10,567,871.70Total EUR 55,022,368.90

AppropriationsLegal reserve (long-term capital gains) EUR 15,191.44Long-term capital gains reserve EUR 26,788,873.56Statutory dividend EUR 6,897,807.62Additional dividend EUR 21,320,496.28Total EUR 55,022,368.90

The net dividend payable on each of the 31,353,671

shares outstanding and carrying rights to the 2000

dividend will amount to EUR 0.90.

Including the tax credit of EUR 0.45 attributable to

shareholders eligible for a 50% credit, the total

revenue per share will amount to EUR 1.35.

The dividend will be payable from June 7, 2001.

Dividends on shares held in treasury stock at that

date will be credited to retained earnings, following

determination by the Board of Directors of the

number of shares concerned.

Dividends for the last three years were as follows

(information provided in accordance with Article

243 bis of the French Tax Code):

Year Net dividend Tax credit Gross(EUR) (50%) dividend

1997 2.59 1.30 3.89

1998 2.75 1.375 4.125

1999 3.72 1.86 5.58

The Annual General Meeting of June 7, 2000

approved a five-for-one stock split.

Third resolution

(Approval of agreements involving directors)

The Annual General Meeting, having heard

the Auditors’ special report issued in accordance

with article L. 225-40 of the Commercial Code,

approves the agreements referred to therein.

Fourth resolution

(Ratification of the appointment

of Véronique Morali)

The Annual General Meeting notes the resignation

from the Board of FIMALAC & CIE and ratifies

the appointment as director of Véronique Morali,

by the Board of Directors’ meeting of April 24, 2001.

Véronique Morali will replace FIMALAC & CIE for

the remainder of the latter’s term of office, expiring at

the Annual General Meeting to be called to approve

the annual accounts for the year ended December 31,

2003.

Fifth resolution

(Re-election of Georges Charpak as Director)

Subject to the condition precedent of the adoption

of the fifteenth resolution, the Annual General

Meeting re-elects George Charpak as Director for a

four-year term expiring at the Annual General

Meeting to be called to approve the annual

accounts for the year ended December 31, 2004.

105A n n u a l R e p o r t 2 0 0 0

Eleventh resolution

(Election of Edouard de Royère as Director)


of the fourteenth resolution, the Annual General

Meeting elects Edouard de Royère as Director for a




Twelfth resolution

(Directors' attendance fees)

The Annual General Meeting sets Directors'

attendance fees at EUR 201,305 for 2001.

Thirteenth resolution

(Authorization to buy back shares)

Having reviewed the Directors’ report and

the information memorandum concerning the

Company’s purchase of its own shares approved

by the Commission des Opérations de Bourse,

in accordance with article L 225-209 of the

Commercial Code, the Annual General Meeting

authorizes the Board of Directors to purchase

a maximum of 3,135,367 FIMALAC shares with

a par value of EUR 4.40, for a maximum amount

of EUR 172,445,185.

The maximum purchase price per share is set

at EUR 55 and the minimum sale price per share

at EUR 30.

Shares may be acquired, inter alia, for the

following purposes:

a) to stabilize the share price by carrying out

systematic transactions to counter market

trends,

b) to purchase or sell shares based on market

opportunities,

c) to grant share options to officers and

employees of the Company and/or its

subsidiaries,

d) for retention and subsequent delivery in

payment or exchange for shares in other

companies, in connection with external growth

operations in order to reduce the acquisition

cost, or more generally to improve the terms

of a transaction by limiting the dilutive effect

thereof.

Sixth resolution

(Re-election of Bernard Pierre as Director)

The Annual General Meeting re-elects Bernard

Pierre as Director for a four-year term expiring

at the Annual General Meeting to be called

to approve the annual accounts for the year ended

December 31, 2004.

Seventh resolution

(Election of BANQUE FÉDÉRATIVE DU CRÉDIT MUTUEL

as Director)



Meeting elects BANQUE FÉDÉRATIVE DU CRÉDIT MUTUEL

as Director for a four-year term expiring at the

Annual General Meeting to be called to approve

the annual accounts for the year ended December

31, 2004.

Eighth resolution

(Election of René Barbier de La Serre as Director)



Meeting elects René Barbier de La Serre

as Director for a four-year term expiring at the

Annual General Meeting to be called to approve

the annual accounts for the year ended December

31, 2004.

Ninth resolution

(Election of Henri Lachmann as Director)



Meeting elects Henri Lachmann as Director for a




Tenth resolution

(Election of Jean-Charles Naouri as Director)



Meeting elects Jean-Charles Naouri as Director for

a four-year term expiring at the Annual General



106 A n n u a l R e p o r t 2 0 0 0

RÉ S O L U T I O N S

e) for attribution on redemption, conversion,

exchange or exercise of share equivalents. The

shares may be purchased, sold, transferred or

exchanged by any appropriate means, on the

open market or otherwise, including by block

purchases or transfers and the use of derivative

instruments, including put options and the

issuance of negotiable bills.

In the case of a bonus share issue paid up by

capitalizing reserves, or of a stock split or reverse

stock split, the above prices will be adjusted

based on the ratio between the number of shares

outstanding before and after the operation.

Any dividends payable on treasury stock purcha-

sed by the Company under this authorization will

be credited to retained earnings.

In accordance with the applicable law, this autho-

rization is given for a period of 18 months from the

date of this Meeting.

RESOLUTIONS TO BE VOTED ON IN EXTRAORDINARY GENERAL MEETING

Fourteenth resolution

(Amendment of the maximum number of Directors

and consequent amendment of article 13 of the

Company’s bylaws relating to the Board of

Directors)

The Extraordinary General Meeting, having heard

the Directors' report resolves to increase the

maximum number of directors from twelve to

twenty-four and consequently further resolves to

amend the first paragraph of article 13 of the

Company’s bylaws as follows:

« The Company is governed by a Board of Directors

comprising a minimum of three and a maximum

of twenty-four members, subject to the specific

exceptions provided by law in the event of a merger ».

Fifteenth resolution

(Amendment of the age limit for directors and

consequent amendment of article 14 of the

Company’s bylaws relating to Directors’ terms

of office, re-election and replacement)


the Directors' report resolves to increase the

maximum age limit for directors from 76 to 80

years, and consequently further resolves to amend

article 14 of the Company’s bylaws as follows:

1. in paragraph 2, 76 years is replaced by 80 years;

2. paragraphs three and four are deleted.

Sixteenth resolution

(Simplification of Company name and consequent

amendment of article 3 of the bylaws relating

to the Company’s name).


the Directors' report resolves to change the

Company’s name to “FIMALAC” and consequently

further resolves to amend article 3 of the

Company’s bylaws as follows:

« Article 3. - Company Name

In accordance with the authorization granted

by FIMALAC & CIE in an agreement dated May 9, 1996,

the Company’s name has been changed to FIMALAC. »

Seventeenth resolution

(Powers to carry out formalities)

The Extraordinary General Meeting gives full

powers to the bearer of an original, a copy or an

extract of the minutes of this Meeting to carry out

all filing, publication, reporting and other

formalities, as required.

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Fimalac

Documents

1 GB-FIMALAC 2000The present document is a translation of FIMALAC 2000 Annual Report. In the event that the french ... offer for the company in 1999. As part of the refocusing plan