Untitled

Holding SA
CONTENTS
S i m p l i fi e d diagram of s i g n i fi c a n t shareholdings 4
Board of Directors 6
International Board 7
Executive Committee 8
Management 9
ACTIVITIES OF THE C O M PA N Y 11
PA RT I C I PAT I O N S 25
HOLDINGS 27
Groupe Bruxelles Lambert S.A. (GBL) 29
Lambert Brussels Associates Limited Partnership (LBA) 30
P a r fi n a n c e 31
BANKS 33
Banque Paribas (Suisse) S.A. (Paribas Suisse) 34
Banque Internationale a Luxembourg (BIL) 35
Henry Ansbacher Holdings Pic. (HAH) 36
Banque de Gestion Privee-SIB (BGP) 37
Banque Bruxelles Lambert (BBL) 38
The Drexel Burnham Lambert Group Inc. (DBLG) 39
I
INDUSTRY AND SERVICES 41
Royale Beige 43
P e t r o fi n a S.A. 44
Tractebel 45
G o m p a g n i e L u x e m b o u r g e o i s e d e Te l e d i f f u s i o n ( G LT ) 4 6
Compagnie Internationale des Wagons-Lits et du Tourisme (Wagons-Lits) 47
Society Parisienne d'Entreprises et de Participations (SPEP) 48
Imetal 49
Compagnie Frangaise de TA f r i q u e Occidentale (CFAO) 50

Swipar Holding AG (Swipar) 51
Rinsoz & Ormond 52
Other direct participations 53
C O M PA N Y ACCOUNTS 55
Consolidated balance sheet 56

Consolidated p r o fi t and loss account 58
Consolidated cash fl o w statement 61
Notes to the consolidated accounts 62
Auditors' Report 69
Statutory balance sheet 70
Statutory p r o fi t and loss account 72
Proposal of the Board of Directors 74
Statutory Auditors' Report 75
PA R G E S A HOLDING S.A. • ANNUAL REPORT 1989 3

S I M P L I F I E D D I A G R A M O F S I G N I F I C A N T S H A R E H O L D I N G S A S AT 3 1 D E C E M B E R 1 9 8 9
This diagram shows the percentages of control by the Group's companies. PA R C

These are detailed in the participations item. HOLDIIN
25,4 31,1 '
LAMBERT BRUSSELS GROUPE BRUXELLES
A S S O C I AT E S 57,0 m LAMBERT
23,3 24,0 24,0 21,7
BANQUE HENRY BAN*
BRUXELLES ANSBACHER INTERNA'

14,0^
LAMBERT HOLDINGS LUXEM]
22,8 20,5 25,4 56,6 16,8 3,7

R O YA L E WAGONS-
PETROFINA TRACTEBEL C . L . T.
BELGE LITS
lSA
3 S.A.
28,6 50,0
F I N A N C I E R E D E PA R I B A S
PA R F I N A N C E
25,2 SUISSE
7,9 61,2 51,0
JE BANOUE
B A N O U E PA R I B A S
DNALE DE GESTION
15,5 (SUISSE)
)URG PRIVEE-SIB
19,5 42,1 14,8 10,0 21,5 15,0

S W I PA R RINSOZ
S . P. E . P. IMETAL C . F. A . O .
HOLDING AG 19,0 &
ORMOND
BOARD OF DIRECTORS
GERARD ESKENAZI Chairman,

Paris
ALBERT FRERE Deputy-Chairman,

Charleroi
PIERRE SCOHIER Vice-Chairman and Managing Director

Brussels
ANDRE de PFYFFER j Vice-Chairman,

Geneva, Attorney at Law
SAMUEL TA P E R N O U X Secretary,
Geneva
Directors
MICHEL ALBERT Paris,

Executive Chairman, Assurances Generales de France
HANS BRAUNSCHWEILER W i n t e r t h u r,
Chairman, Winterthur Assurances S.A.
GILLES COLOMB Geneva,

Chairman, Grand-Passage S.A.
PA U L D E S M A R A I S S r. Montreal,
Chairman, Power Corporation of Canada
MICHEL FRANQOIS-PONCET Paris,

Executive Chairman, Compagnie Financiere de Paribas
LUZIUS GLOOR Basel,

General Manager, La Baloise (Assurances)
PIERRE LANGUETIN Bern
ROBERT PIAGET Lausanne,

Attorney at Law
Auditors
ERNST & YOUNG S.A. Geneva
6 PA R G E S A HOLDING S.A. • ANNUAL REPORT 1989

I N T E R N AT I O N A L BOARD
Members
JAMES BALOG N e w Yo r k ,
Chairman of the Board, The Lambert Brussels Capital Corporation
MANUEL BOULLOSA Rio de Janeiro,

Chairman, Banco Pinto de Magalhaes
PHILIPPE LAMBERT Geneva,

General Manager, Banque Bruxelles Lambert (Suisse) S.A.
JEAN-PIERRE LAURENT-JOSI Brussels,

Executive Chairman, Groupe Josi
ANDRE LEYSEN Antwerp,

Chairman, Gevaert N.V.
EDWARD E. M AT T H E W S N e w Yo r k ,
Executive Vice-President, American International Group Inc.
DIDIER P I N E A U - VA L E N C I E N N E Paris,
Executive Chairman, Schneider S.A.
FAHAD M. AL-RAJAAN Kuwait,

General Manager, The Public Institution for Social Security-
GASTON THORN Luxemburg,

Former President of the European Economic Commission
Chairman, Banque Internationale a Luxembourg
PA R G E S A HOLDING S.A, • ANNUAL REPORT 1989 7

EXECUTIVE COMMITTEE
Chairman
GERARD ESKENAZI Chairman of the Board
Members
ALBERT FRERE Deputy-Chairman
ANDRE de PFYFFER Vice-Chairman of the Board
JEAN LANIER Managing Director
PA U L D E S M A R A I S S r. Montreal,
Chairman, Power Corporation of Canada
PAUL DESMARAIS Jr. Montreal,

Chairman, Power Financial Corporation
ULF LINDEN Goteborg,

Chairman, Kanthal Hoganas A.B.
GILLES SAMYN Charleroi,

Managing Director, Erbe S.A.
Secretary
DIDIER BELLENS S e n i o r V i c e - P r e s i d e n t a n d C h i e f F i n a n c i a l O f fi c e r
8 PA R G E S A H O L D I N G S . A . • A N N U A L R E P O R T 1 9 8 9
M A N A G E M E N T
Senior Management
GERARD ESKENAZI Chairman and Chairman of the Executive Committee
ALBERT FRERE Deputy-Chairman
JEAN LANIER Managing Director
Bank shareholdings
CLAUDE VERCAMBRE Executive Vice-President
Administrative and financial management
DIDIER BELLENS S e n i o r V i c e - P r e s i d e n t a n d C h i e f F i n a n c i a l O f fi c e r
CHRISTOPHE G R AV E Vice-President
PAT R I C K de HENEY Vice-President
OLIVIER de JAMBLINNE Assistant Vice-President, Pargesa Luxembourg S.A,
FABIENNE RUDAZ Treasurer
C H I R I TA DUMITRU Head of Accounts Department
Advisers
PIERRE HAAS Adviser
RICHARD FENHALLS Executive Chairman, Henry Ansbacher & Co. Limited
Interna] Audit
HENRIPERPETE Vice-President
HANS PETERHANS Controller
PA R G E S A H O L D I N G S . A . • A N N U A L R E P O R T 1 9 8 9 9
A C T I V I T I E S O F T H E C O M PA N Y
PA R G E S A H O L D I N G S . A .
1989 1988 1987 1986
Consolidated shareholders' equity (SF m i l l i o n ) 1,940.6 1,638.2 1,431.0 1,440.6

Consohdated net profit^ (SF m i l l i o n ) 207.5 162.2 161.7 150.1
Dividends (SF m i l l i o n ) 75.2 71.1 67.8 58.2
Consolidated profit per share^ ^ (SF) 179.4 147.5 147.1 149,5
Dividend per share^ (SF) 65.0 64.7 61.7 57.9
1. before exceptional items — 2, adjusted
PA R G E S A H O L D I N G S . A . ■ A C T I V I T I E S O F T H E C O M PA N Y 1 9 8 9 11
The Group is invested primarily in
PargesaGroupconsist ofo
fur
operational holding companies: banks (21%), insurance and financial
services (22%), trading companies
— the parent company, Pargesa Hold (23%) and energy (20%).
ing S.A., is based in Geneva; Group investments in the banking

— Groupe Bruxelles Lambert S.A., sector are divided on the one hand into
institutions where the Group has deci
active mainly in Belgium, also partici
sive control, and on the other hand it is
pates on an equal footing with
also invested in banks where its degree
Pargesa, in the development of inter
of involvment is variable.
national investments;
— Parfinance in France is responsible In the industrial and commercial sector.
for initiating and supervising Group Group activities are concentrated on a

limited number of major companies with
investments in that country;
good prospects for future growth. In
— Lambert Brussels Associates Limited
these investments, Pargesa Group acts
Partnership, established in Bermuda, either as reference shareholder or with
looks after Group investments in the joint control.
United States.
The Group manages a portfoho of parti

cipations of which the consolidated
valuation at the end of 1989 is SF 7.3
billion.
PA R G E S A HOLDING S.A. - ACTIVITIES OF THE C O M PA N Y 1989 13

14
1. Major events in the financial year: that company's capital, Electrafina also
has 25.4% of the capital of Tractebel, a
Pargesa's investment activities and
group active in electrical production,
favourable stock market conditions in
distribution and engineering.
June caused the Company to call for a
total of SF 312 million from the market. Pargesa increased to 28.6% its holding
The Company accordingly issued in its French subsidiary Parfinance, and
shares with subscription right and subscribed for its share in the capital
bonds repayable with Pargesa shares, increase of that company. The new
denominated in Luxemburg francs. The equity raised by Parfinance totals FF 1
issue price of the new bearer and billion, in the form of bonds repayable
registered shares was fixed at SF 1,530 with shares and shares with subscription
and SF 153 respectively, ten existing rights. Parfinance was thus able to
shares giving the right to subscribe to consolidate its position in certain stra
one new share. The bonds will be tegic investments. The holding in Imetal
repaid in 1994 by the granting of 60,000 was raised from 28.1% to 42.1%, and the
bearer shares and 60,000 registered holding in CFAG from 13.3% to 14.8%.
shares. The issue price of the bearer In December 1989, the participation in
shares to be used for the repayment Companie Financiere Paribas was
totals Lux F 50,000 (Lux F 5,000 per raised to over 5%, taking into account
registered share). the direct participation held by Pargesa.
Within the overall restructuring of the In Switzerland, Pargesa took a 15%

energy sector in Belgium, Pargesa holding in Rinsoz & Grmond, a group
c o n t r i b u t e d i t s P e t r o fi n a s h a r e s t o i t s active in the tobacco sector and in
subsidiary Groupe Bruxelles Lambert distribution of luxury food products. This

(GEL). This transaction enabled Pargesa participation is Pargesa's first direct
to increase its participation in GEL from investment in Swiss industry.
29.1% to 31.1%. As the result of its
merger with Grands-Lacs-Cometra,

Electrafina, a 39% held subsidiary of
GEL, has become the Group's main
centre of activity in the energy sector.
Consequently to this restructuring, Elec
trafina becomes the leading share
holder in Petrofina, holding 20.5% of
PA R G E S A H O L D I N G S . A , - A C T I V I T I E S O F T H E C O M PA N Y 1 9 8 9 15
E V O L U T I O N O F T H E PA R G E S A S H A R E P R I C E
Pargesa SBC General Index SBC Bank Index
16
Pargesa disposed of 6% of the capital 2. Consolidated profit and loss account
of Banque Paribas (Suisse) S.A., reduc
The consolidated profit before extraor
ing its holding from 31.5% to 25.5%.
This involved shares other than those
dinary items rose in 1989 to SF 207.5
million, i.e. SF 179.4 per share.
held jointly with Paribas Paris, through
the Societe Financiere de Paribas In February 1990, The Drexel Burnham
S u i s s e B . V. Lambert Group Inc. was obliged to
In Great Britain, Henry Ansbacher suspend repayment to its creditors by

invoking Chapter XI of American bank
Holdings Pic (HAH) has sold its insur
ance broking activities, and will in ruptcy law. Its management immediately
set its liquidation in progress. At this
future concentrate on merchant banking
and the management of" offshore" stage, it is impossible to anticipate the
outcome. In these circumstances, the
trusts and companies.
Board decided to write off the total indi
In the United States, the year was rect participation in The Drexel Bum-
marked principally by the deterioration ham Lambert Group Inc, against the
o f t h e fi n a n c i a l s i t u a t i o n o f T h e D r e x e l 1989 financial year, giving rise to an
Burnham Lambert Group Inc. The extraordinary loss of SF 200,6 million,
events that took place at the start of i,e, SF 173,4 per share.
1990 are described later in this report,
After taking these extraordinary items
into account, the net consohdated profit
of the financial year was SF 4,6 million.
Simplified consolidated profit and loss account
(SF million) 1989 1988 1987 1986
Income from holdings 190.7 151.1 140.7 155.4

Other income and expenses (net) 30,2 16.7 27.9 8.6
Amortisation of goodwill (13.4) (5.6) (6.9) (13.9)
Profit before extraordinary items 207.5 162.2 161.7 150.1
Extraordinary items (202.9)* (2.0) (2.1) (4.0)
Net profit 4.6 160.2 159.6 146.1

* of which the DBLG amortisation is SF 200.6 million
PA R G E S A H O L D I N G S . A . - A C T I V I T I E S O F T H E C O M PA N Y 1 9 8 9 17
DIVIDEND AND NET PROFIT PER SHARE
179.4
149.5 147.1 147.5
64.7
61.7
57.9
1986 1987 1988 1989
SHAREHOLDERS' EQUITY AND MARKET CAPITALISATION
2416.6
2295.4
1986 1987 1988 1989
Net profit per share before extraordinary result (adjusted) Market Capitalisation
I Dividend (adjusted) Shareholders' Equity
18
Evolution of direct and indirect contributions to income from participations
(SF million) 89 % 88 %
Paribas Suisse 21.2 11 . 1 24.7 16.4

BIL 23.7 12.4 20.3 13.5
H A H 13.3 7.0 8.4 5.6
BGP 4.6 2.4 2.3 1.5
Insurance 28.2 14.8 20.9 13.8
Energy 31.4 16.4 14.0 9,3

Imetal 18.8 9.9 13.2 8.7
SPEP 11 . 5 6.0 6.4 4,2
CFAO 4.2 2.2 1.4 0.9
Other participations income and capital gains 29.5 15.5 61.8 40.9
European participations 186,4 97.7 173.4 11 4 . 8

American participations 4.3 2.3 (22.3) (14.8)
Participations income 190.7 100.0 151.1 100.0
The table shows that: 3. Statutory profit and loss acount

— The total contribution from our parti The statutory profit for the year is
cipations increased by 26.2% in com SF 80.1 million, i.e. SF 69.3 per share,
parison with the 1988 financial year. compared with SF 90.1 million in 1988.
— As a result of the operations involv The reduction in statutory profit results
from taking into account the reduction
ing Electrafina, P^trofina and Tracte-
in value of the direct investment in LBA,
bel, the share of income deriving
the subsidiary holding the Drexel Burn-
from the energy sector rose from SF
ham Lambert Group Inc participation.
14 million to SF 31.4 million.
— Results from HAH were considerably The Board will propose at the General
Meeting a distribution of a dividend of
improved and contributed 7% of our
SF 65 per bearer share. The total divi
participations income.
dend distributed by the company would
— Contributions from the participations therefore be SF 75.2 miUion, leaving SF
held by our French subsidiary Parfin- 99.3 million to be carried forward.
ance continue to make significant
progress, especially in respect of
SPEP (Groupe Schneider), Imetal and
CFAO,
— The reduction in the " Other partici
pations income and capital gains"

item is primarily the result of a signi
ficant reduction of certain exceptio
nal elements which took place in 1988.
BREAKDOWN OF PORTFOLIO BY SECTOR (%)
Industry and commerce 22.9
Banks 20.9
^Energy ■ ' - ^ 20.3

J
Insurances 13.8'
Other fi n a n c i a l services 8.1
Other holdings 14.0
20
statutory profit and dividend
1989 1988 1987 1986>
Statutory profit (SF million) 80.1 90.1 79.5 65.4
per share* 69.3 82.0 72.3 65.0
Dividend (SF million) 75.2 71.1 67.8 58.2
per share* 65.0 64.7 61.7 57.9

* Swiss francs, adjusted
1. income from the restructuring of Lambert Brussels Corporation (LBC) is not included (SF 27,2 million)
4. Net asset value and structure of on a fully consolidated basis and includ
portfolio ing third party minority interests of GBL,
Parfinance and LEA. Taking into account
At the end of 1989, based on market
the investment policy followed during
prices of quoted direct and indirect subsi
the last few years and the complete
diaries and on the book value of share
amortisation of the participation in The
holders' equity of non-quoted subsidia
Drexel Bumham Lambert Group Inc.,
ries, the estimated value of assets held
the share of the industrial and commer
by Pargesa Holding S.A. was SF 2,961
cial sector represents 43,2% of the total
million, This valuation is after the
portfolio, with banks now being 20.9%,
complete amortisation of the participa
tion in The Drexel Bumham Lambert
5. Stock market development and
Group Inc,
fi n a n c i a l r a t i o s
Pargesa's long term borrowing, denomi
The diagram on page 16 shows the
nated in Swiss francs, ECU and Luxem
progress of the share price compared
burg francs, is SF 327 million; these loans
with the SBC General and Banking
were taken out between 1986 and 1988,
Indices,
and the average interest rate is 4,6%,
The average annual growth in profit per
On the bases shown above, the net
share (before DBLG amortisation) has
asset value is SF 2,634 miUion, i.e.
been almost 6% since 1986, In this
SF 2,048 per share. This includes
same period, the dividend has
shares issued in respect of bonds
increased by an average of 4%,
repayable with shares.
The stock market price at the end of
The diagrams on pages 20 and 22 show
1989 shows a discount of 13% relative to
the spread by sector and region of the
the estimated net asset value.
Pargesa Group's long term investments
Historical data per share
1989 1988 1987 1986
Share price (end of year)^ 1,785 1,592 1,224 2,133

Profit per share' ^ 179.4 147,5 147,1 149,5
Dividend per share' 65,0 64,7 61,7 57.9
Gross yield 3,6 4.1 5,0 2.7
Price/earnings ratio 9,9 10.8 8,3 14.3
1. Swiss francs, adjusted — 2, before exceptional item
BREAKDOWN OF PORTFOLIO BY REGION (%)
' Belgium 33.6 '
s:.
U.S.A, 7.3
Switzerland 6.6
U.K. 4.8
Other countries 10.8
2 2
6. Conclusion If these proposals are accepted, the
dividend distributed will be SF 65 per
The Board of Directors will propose at
bearer share issued before 1 January
the General Meeting a dividend of SF
1989, SF 6.50 per registered share
65 per bearer share and SF 6.50 per
issued before 1 January 1989, and
registered share.
SF 32.50 per bearer share issued in
On this basis, new shares issued in 1989 June 1989, SF 3.25 per registered share
are entitled to a half-dividend, i.e. SF issued in June 1989.
32.50 per bearer share and SF 3.25 per
Certain Directors have reached the end
registered share. The dividend per of their term of office. Being ehgible,
share paid in respect of the financial
they offer themselves for re-election.
year is thus the same as that paid for
They are Mr Michel Albert, Mr Paul
1988, but a larger number of shares is
Desmarais Sr., Mr Gerard Eskenazi, Mr
being remunerated.
Albert Frere, Mr Luzius Gloor, Mr Andre
de Pfyffer, Mr Robert Piaget, Mr Pierre
7. Proposals at the General Meeting
Scohier and Mr Samuel Tapernoux.
Taking into account the profits of the Gerard ESKENAZI, Chairman
financial year, the Board will propose at
Albert FRERE, Deputy Chairman
the General Meeting that the net profit
for the year of SF 80,141,660 together
with the balance brought forward of SF
98,385,310, making a total of
SF 178,526,970, be allocated as follows;
— dividend SF 75,189,855
— legal reserve SF 4,010,000
— r e t a i n e d e a r n i n g s S F 9 9 , 3 2 7 , 11 5
PA R G E S A H O L D I N G S . A , - A C T I V I T I E S O F T H E C O M PA N Y 1 9 8 9 23
PA RT I C I PAT I O N S
S U B S I D I A R I E S A N D PA R T I C I PAT I O N S : K E Y D ATA
Company Currency Direct Direct Controlling N e t p r o fi t Shareholders'
holding and indirect interest^ 1989 equity 1989

holding^ (SF million) (SF million)
GBL BF 31.1% 31.1% 31.1% 325.1 2,348,5

LBA US$ 25.4% 43.1% 82.4% (584,4)3 279,54
P a r fi n a n c e FF 28.6% 36,4% 53.8% 129,3 1,351,1
Paribas Suisse SF 25.5% 25.5% 27.9%5 85,2 688,3

BIL LuxF 27.9% 34.6% 49.6% 62,0 428,7
H A H £ 24.0% 31,4% 62.0%5 30.8 318,34
BGP F F 22,3% 76.7%s 21,5 172.2
BBL BF 4,1% 23.3% 212,1 1,973,2
Royale Beige B F 7,1% 22,8% 150,1 2,047,2

P e t r o fi n a BF 2,5% 20,5% 943.9 6,213,7
Tractebel B F 3,1% 25.4% 379.6 3,330.2
C LT LuxF 6,5% 56,6% 8.5 291,9
Wagons-Lits B F 4,8% 20,5% 63.3 558,6
SPEP FF 7,1% 19,5% 160.7 1,031,9
Imetal FF 15,3% 42.1% 125,3 901.0
CFAO FF 5,4% 14.8% 80,5 1,150.5
Swipar SF 21.5% 24,1% 31.5% 2,1 84.9
Rinsoz & Ormond SF 15.0% 19.6% 34.0% 6,2 101,1
1. Consolidated % participation
2. Total of direct % participations of the Group
3. Including DBLG amortisation
4. Permanent capital
5. At 31 December 1989, BIL held the following participations:
- 2,4% of Paribas Suisse,
- 14% of HAH,
- 1 5 . 5 % o f B O P.
PA R G E S A H O L D I N G S . A . - PA R T I C I PAT I O N S 1 9 8 9 25
HOLDINGS
The Pargesa Group today operates Lambert Brussels Associates Limited
through four holding companies which Partnership, established in Bermuda, is

closely co-ordinate the Group's activi responsible for managing and develop
ties. ing the American assets.
Pargesa Holding S.A., based in Geneva, The role of these holding companies is
is the parent company of the Pargesa to apply the strategy of the Group,
Group. fostering a climate of confidence that
favours the development of a true part
Groupe Bruxelles Lambert S.A., in addi
tion to its function as Pargesa's most nership between the Group and its
participations and subsidiaries, both in
significant international partner is
t h e fi n a n c i a l s e c t o r a n d t h a t o f i n d u s t r i a l
responsible for the Group's investments and service companies.
in Belgium.
Parfinance S.A,, based in Paris, is the

Group's investment vehicle in France.
28
GROUPE BRUXELLES LAMBERT S.A. (GBL)
he second largest Belgian hold sified its activities into the following
ing company in terms of assets, sectors: finance, energy, insurance, media,
GBL has to a large extent diver tourism, real estate and international trade,
(BF million) 1989E 1988 1987
Pargesa's participation 31.1% 29.1% 30.0%
Equity 54,238 41,177 40,998
Net profit 7,5091 5,850 5,727
Net profit per share* 379 334 328
Dividend per share* 136.5 130.0 126.0

' Belgian francs - 1. before DBLG amortisation
The fundamental restructuring of GBL's Sodexho merged their restaurant busi

interests in the energy sector is the nesses within an equally held subsidi
most important event in the 1989 finan ary. Gompagnie Luxembourgeoise de
cial year. Te l e d i f f u s i o n c o n t i n u e d i t s i n t e r n a t i o n a l
In March, Societe Generate de Belgi- development, particularly in Germany

and the Netherlands. Finally, GBL
que and GBL reached an agreement
decided to link its real estate develop
defining their respective participations
ment activities together with those of
i n P e t r o fi n a a n d T r a c t e b e l . G B L
confirmed its place as leading share Royale Beige and Compagnie Nationale
a Portefeuille.
h o l d e r i n P e t r o fi n a w h e r e i t h a s a 2 5 %
holding, and as second shareholder in Given the current situation of DBLG —

Tractebel with 25,4% of the capital of detailed later in this Report — and in
that company. In the course of these line with Pargesa and LBA, the Board of
operations, GBL increased its equity by GBL decided to amortise this participa
BF 13 billion (SF 562.9 miUion) to remu tion completely, charging it against the
n e r a t e c o n t r i b u t i o n s o f P e t r o fi n a s h a r e s 1989 financial year. Taking this item into
by some of its shareholders, these account reduced the consohdated profit
shares subsequently being ceded to to BF 4.3 bilhon, i.e. BF 215 per share,
E l e c t r a fi n a . whereas without this exceptional loss,
the profit would have risen from BF 5.8
In the financial sector, GBL subscribed
billion to BF 7.5 billion (SF 324.7
to the capital increase of Banque
million), i.e. BF 379.4 per share.
Bruxelles Lambert (BF 8 billion, i.e. SF
346.4 million) and of Parfinance (FF 1
biUion, i.e. SF 266.5 million).
In addition, Compagnie Internationale

des Wagons-Lits et du Tourisme, in
which a 16.8% participation is held, and
PA R G E S A H O L D I N G S . A . - PA R T I C I PAT I O N S 1 9 8 9 2 9
L A M B E R T B R U S S E L S A S S O C I AT E S
LIMITED PARTNERSHIP (LBA)
BA is a partnership formed in (LBC), an American subsidiary founded

1986, It is the successor to The with the aim of investing principally in the
Lambert Brussels Corporation financial, industrial and real estate sectors.
(US$ million) 19891 1988 1987
GBL's participation 57.0% 57.0% 57.0%
Permanent capital 181.5 573.3 629.2
Net profit (379.5) (41.4) 73.1
Partnership distribution (including interest) 18.1 20.2 24.0
1, As shown in the Pargesa accounts
The year's results have been influenced continue to increase their funds under
by the events arising from the participa management, producing a significant

tion of LBA in The Drexel Burnham level of profitability.
Lambert Group Inc.
Mergers and acquisitions produced an
The depression in the American real income of $ 1,1 million (SF 1,7 million)
estate sector made it necessary to write from seven different operations.
down by US $ 9.5 million (SF 14.6 million)
Following an agreement with another
the value of LBA's investments in MLM,
reinsurance company — Transatlantic
Tierco Group and US Shelter.
Holdings — whose name it will be taking,
TransCapital, an investment fund for the Putnam reinsurance company, in
high yield bonds, completed its finan which LBA has a 25% holding together
cial year to 30 June 1989 satisfactorily, with American International Group and
paying interest of over 10% to bond American Express, continues to record
holders. The high yield bond market excellent results and has in consequence
has subsequently deteriorated, d i s t r i b u t e d i t s fi r s t d i v i d e n d . P u t n a m
should be launched on the stock market
After an excellent first half year, risk
in 1990 if market conditions are favourable.
arbitrage operations both on LBA's own
account and that of third parties were
adversely affected by the weakness of
fi n a n c i a l m a r k e t s .
The two asset management companies

in which LBA has a significant holding
30 PA R G E S A H O L D I N G S . A . - PA R T I C I PAT I O N S 1 9 8 9
PARFINANCE
arfinance is the Group's invest Its portfolio consists principally of

ments vehicle in the French F r e n c h s e c u r i t i e s i n t h e fi n a n c i a l a n d
market. industrial sectors.
(FF million) 1989E 1988 1987
GEL'S participation 25.2% 25.2% 25.2%
Equity 5,070.0 4,534.6 4,124.8
Net profit 485.0 372.3 96.6
Net profit per share* 20.6 17.1 4.4

* French francs
Parfinance proceeded in April 1989 with by M^tropole Television (the company

the simultaneous issue, for an overall holding the concession for M6, the sixth
total of FF 1 billion (SF 266.5 million), of French television channel), by Defi (a
shares with purchase options and of holding company investing in small and
bonds repayable in shares, raising the medium businesses), and by REL (an
equity to FF 5.1 billion (SF 1.4 billion). investment company specialising in
These additional resources enabled

leveraged buy out (LBO) operations.
Parfinance to strengthen its existing In the course of the year, the 60% hold
participations and to take part in financ ing in Deugro Investments was disposed
ing activities carried out by some of of. This produced a capital gain of FF 143
them, in certain cases doing both. The million (SF 38.1 million) before tax.
holding in Im^tal was thus increased
from 28.1% to 42.1% in the course of the
Banque de Gestion Privee, the banking
subsidiary of Parfinance was able to
year. In addition, Parfinance subscribed
FF 264 million (SF 70.4 million) to the develop synergies with participations in
the Group.
bond and share issues in July 1989. At
the end of 1989, Parfinance held 4,6% of The net consolidated profit (Group
the capital of Compagnie Financiere de share) rose to FF 485 million (SF 129.3
Paribas. Because of a direct participation million) i.e. FF 20.6 (SF 5.5) per share,
held by Pargesa, the Group exceeded compared with FF 372.3 million in the
the 5% threshold in Paribas. previous year.
The holding in Compagnie Frangaise The company's net profit for 1989 was
de I'Afrique Occidentale (CFAG) has FF 186.6 million (SF 49.7 million). Parfin
been increased to 14,8%. ance will propose a dividend of FF 7
Parfinance maintained at approximately per share, compared with FF 6 per

share in the previous financial year,
20% its holding in Societe Parisienne
even though the number of shares to be
d'Entreprises et de Participations (SPEP)
remunerated has increased.
and at the start of 1990 participated in
the various financing activities carried
out by this company,
P a r fi n a n c e a l s o s u b s c r i b e d f o r i t s s h a r e
in the call for funds carried out in 1989
32
BANKS
Pargesa's banking participations are In addition, the Group has significant

organised into an international federa holdings in banks whose objectives may
tion whose members are linked not only not correspond so closely to Pargesa's
by their financial association but also by basic strategy, such as Banque Paribas
a common philosophy and strategy, (Suisse) S.A,, Banque Bruxelles Lambert
and The Drexel Burnham Lambert
This strategy is concentrated on activi
ties with high added value but limited Group Inc.; the degree of intervention
in these banks is variable.
need for capital, such as fund manage
m e n t o r fi n a n c i a l a d v i c e . E a c h o f t h e As its overall plan, Pargesa concen
institutions can call on specific exper trates its investments in well known
tise developed by any other member in institutions which provide access to the
the network. The aim is to encourage w o r l d ' s m a i n fi n a n c i a l c e n t r e s . T h e
on a permanent basis the reciprocal specialised professionalism of these
exchange of information, ideas, know- banks, the high quality of their teams
how and business contacts. and the potential of their markets
This international federation is formed together make it possible to achieve

rapid growth, leading to a satisfactory
primarily by Banque Internationale a
return on invested capital.
Luxembourg, Henry Ansbacher
Holdings Pic, Banque de Gestion
Privee-SIB. Pargesa takes an active part
in deciding the strategy of these institu
t i o n s a n d t h e u s e o f t h e i r fi n a n c i a l a n d
human resources.
BANQUE PARIBAS (SUISSE) S.A. (PARIBAS SUISSE)
stablished in 1872 in Geneva, zerland, ranking among the leaders of

Paribas Suisse is the longest the Swiss banking sector in terms of
established foreign bank in Swit shareholders' equity and profitability.
(SF million) 1989 1988 1987
Pargesa participation 25.5% 31.5% 33.9%
Equity 688.3 663.2 639.6
Net profit 85.2 80.2 78.6
* Swiss francs
Net profit, after amortisations and provi Currency and short term loans deve
sions, rose by 6.2%, being SF 85.2 million loped in a radically changing environ
compared with SF 80.2 miUion in 1988. ment. The bank's net margins
decreased in 1989, notably because of
The Board will propose the distribution
the ending of the exceptional financing
of a dividend of SF 17.5 (compared with
conditions experienced during the first
SF 16,5 in 1988), an increase of 6%.
half of 1988,
The bank's equity increased, after
The recent development of risk mana
distribution of 1989 profit, to SF 688.3
gement techniques and methods, of
miUion, compared with SF 663.2 million
interest rates and currency conversion,
at the end of the previous financial year.
(Forward Rate Agreements, swaps,
At 31 December 1989, the total of the options) have made it possible to
balance sheet was SF 6.9 biUion. achieve a considerable increase in the
volume of business.
Paribas Suisse experienced a favoura
ble development in its commercial The acquisition of the Zurich bank Louis
banking activities. Loans to clients Dreyfus, completed in May 1989, will ena
increased by 22.5% in comparison with ble Paribas Suisse to strengthen its posi
the previous year. tion in German-speaking Switzerland.
Funds placed with the bank for invest Finally, income from shares and long term
ment also grew substantially. participations increased.
The bank's share of the Swiss capital
market — an area of fierce competition
between the institutions concerned —
r o s e f r o m 3 . 11 % t o 4 . 4 6 % . P a r i b a s
thereby rose to 6th place in terms of

lead management at the end of 1989.
34 PA R G E S A HOLDING S.A, - PA RT I C I PAT I O N S 1989

BANOUE INTERNATIONALE A LUXEMBOURG (BIL)
he most senior of Luxemburg's Duchy. Offering all the traditional bank

banking institutions, BIL is still the ing skills, BIL is particularly active in fund
largest private bank in the Grand management and capital markets.
(Lux F million) 1989 1988 1987
Pargesa's participation 2 7 . 9 % 27.9% 25.1%
Equity 9,901 9,186 8,458
Net profit 1,433 1,416 1,094
Net profit per share* 1,187.1 1,174.8 912.1
Dividend per share* 500 500 430
* L u x F
At the end of the 1989 financial year, Operations in capital markets continued
the total of the balance sheet was Lux to be active. With its large scale plac
F 515,6 bilhon (SF 22.3 billion) compared ing capacity, BIL took part as leading or
with Lux F 418.3 biUion in 1988, i.e. an joint-leading bank in 368 national and
increase of 23,3%, The net profit was international issues.
Lux F 1,4 billion (SF 62 milhon), allowing
The sector of collective issuing institu
the distribution of a net dividend of Lux
tions has again expanded in Luxem
F 500 (SF 21,6) per share.
burg, and BIL has been a principal
For many years, considerable effort has beneficiary from this trend. Its position
been devoted to services relating to as leader in the Luxemburg market, and
private fund management. In 1989, the also as a worldwide provider of funds
range of products and services offered and administrative services improved
to the national and international chent still further during the year, in spite of
base was extended once again. Particu keen competition.
lar attention was also directed to institu
tional fund management and the streng
thening of co-operation with Euro
Pacific Advisers in Hong Kong and
Banque de Gestion Privee-SIB in Paris,
two companies of the Group in which
BIL has a holding.
PA R G E S A H O L D I N G S . A , - PA R T I C I PAT I O N S 1 9 8 9 35
HENRY ANSBACHER HOLDINGS PLC (HAH)
ounded in 1894, the London HAH which operates in the fields of corporate
group has its principal activity credit, mergers and acquisitions, financial
in merchant banking through its advice, and management and adminis
subsidiary Henry Ansbacher & Co Limited, tration of "offshore" trusts and companies.
(£ thousand) 1989 1988 1987
Equity 128,753 120,034 120,309
Net profit^ 12,470 5,197 2,862
Net profit per share*^ 3.5 2.6 2.2
^ pence — 1. including extraordinary profit — 2. excluding extraordinary profit
1989 was a year of rationalisation and 1989 is also the first full financial year of
expansion for HAH which withdrew from Henry Ansbacher Asset Trading Ltd
the insurance broking sector in order to (HAAT), the subsidiary formed in July
concentrate exclusively on its activities 1988 to trade in the market of credit for
as a merchant banker. The pre-tax developing countries. The results
profit achieved is £10. 1 miUion (SF 25 achieved have been excellent. In the
million) compared with £7.2 million in course of 1989, HAAT has satisfactorily
1988. This year's profit was enhanced concluded 208 transactions with
by an extraordinary profit of £5.9 million 5 3 b a n k s a n d fi n a n c i a l i n s t i t u t i o n s f o r a
(SF 14.6 million) arising principally from total of US$ 1.2 billion (SF 1.8 billion).
the sale of the insurance business.
In London, the three principal depart
In January 1989, the "offshore" division ments of Henry Ansbacher & Co Ltd —
of Henry Ansbacher & Co Ltd acquired commercial credit, corporate advice
The International Trust Group, making it and treasury — have had satisfactory
possible to extend the activity of fund results. The mergers and acquisitions
management and administration of department, based in New York and
" offshore trusts" from Europe (Guern
London, experienced a very active
sey, Gibraltar and Monaco) to the Baha year, during which it was able to
mas, the Cayman Islands (where the conclude a significant number of deals
bank was already present) and the in the media and pubhshing sectors.
Virgin Islands. Assets administered by
the " offshore" division are now in
excess of £1 billion (SF 2.5 biUion). The
expansion of this division has made a
significant contribution to the pre-tax
profit of HAH in this financial year.
36 PA R G E S A HOLDING S.A. - PA RT I C I PAT I O N S 1989

BANQUE DE GESTION PRIVEE-SIB (BGP)
argesa Group's banking subsidi gement for third parties, financial and
ary in France, BGP is active in banking technical advice, market trad
four main sectors: asset mana ing and real estate.
(FF million) 1989 1988 1987
Parfinance's participation 61.2% 61.1% 55.6%
Equity 646.3 600.2 570.3
Net profit 80.8 61.4 50.9
Dividend per share* 11 . 0 10.0 8.0

* French francs
Net profit for 1989 is FF 80.8 million Emerging Markets Fund and The
(SF 21.5 million), an increase of 32% Vienna Investment Fund have been
compared with 1988. This growth is due successfully launched.

mainly to the good progress of the The market trading department has
banking and financial department, the
consistent high level of activity in asset recently redirected its activities towards
the sectors where it holds competitive
management, and the confirmation of
the bank's potential in the real estate advantages. This is especially the case
in the field of option trading, where its
sector.
subsidiary Transoptions S.A., specialis
The banking and financial department, ing in the share option market (MONEP)
which in the course of the year streng has substantially exceeded its targets.
thened its teams in the mergers and Activity as a market maker in MATIF
acquisitions sector, saw its efforts contract options has been carried out
rewarded with a high level of turnover by a specially formed subsidiary to
which should further develop in 1990. enable rapid growth of this activity.
The asset management department Real estate management has contri

remains the bank's most important area. buted significantly to the bank's profit,
Assets under management grew consis although formed only recently and with
tently and activities were not seriously a limited staff.
affected by the " mini-crisis" in October;
this strength is the result of the bank's
investment pohcy. New products, such
as Selective Managers, The Asian
PA R G E S A H O L D I N G S . A , - PA R T I C I PAT I O N S 1 9 8 9 3 7
BANOUE BRUXELLES LAMBERT (BBL)
BL is active in Belgium through national banking, being present in some

i t s n e t w o r k o f 9 8 5 b r a n c h e s , a n d 3 0 d i ff e r e n t c o u n t r i e s ,
also plays a major role in inter-
(BF million) 19891 19881 19871
GBL's participation^ 23.3% 19.2% 16.9%
Equity 45,571 35,327 31,756
Net profit 4,899 3,982 3,632
Dividend per share* 134.7 122.3 11 2 . 5
* Belgian francs (adjusted) - 1, Financial years ending 30.09 - 2. and of GBL's subsidiaries.
At the end of 1989, BBL showed further The availability on the market of unres
progress in its consolidated results. Net tricted liquidity together with the
profit for the year has risen by 23% progressive rise in interest rates — start
compared with the previous year, ing with short term rates — has in contrast
reaching BF 4.9 billion (SF 212,2 resulted in a reduction of intermediary
milhon), and the balance sheet total is margins, BBL has for the most part com
almost BF 2,000 billion (SF 86,6 billion). pensated for this narrowing of margins
by significantly increasing its volume.
This expansion is happening in the
context of strong growth of the In addition, other income, made up
economy, both in Belgium and other mainly of fees, has increased by 10%,
countries, shown by a sustained
Finally, BBL continued its pohcy of cover
increase in business investment, a rise
in international business and an incr
ing sovereign risk where international
debts have been rescheduled. On the
ease in personal wealth. These factors
basis of consohdated data, loan loss pro
have had the effect of stimulating BBL's
visions for these debts are now at 100%,
lending activity to the private sector,
which have risen by 23%, On the other
hand, public sector credit has decreased
by 7%,
3 8 PA R G E S A H O L D I N G S . A . - PA R T I C I PAT I O N S 1 9 8 9
THE DREXEL BURNHAM LAMBERT GROUP INC. (DBLG)
In February 1985, an agreement was
On13Febu
rayr 1990,TheDe
rxel
Burnham Lambert Group Inc.
(DBLG), parent company of
concluded, enabling LBA to receive
dividends from DBLG for 8 years, in
Drexel Burnham Lambert Inc., one of return for a dilution of 20% of its holding
the largest brokerage institutions in the over this 8-year period.
United States, filed for protection under
The value of LBA's investment in DBLG
Chapter XI of the American federal
cannot be determined at this stage,
bankruptcy law.
given the numerous uncertainties
This event has been the subject of involved in the bankruptcy procedure
extensive commentary and analysis in and the difficulty of valuing assets and
the press. It will no doubt continue to d e fi n i t e o r c o n d i t i o n a l l i a b i l i t i e s o f
be discussed and studied within the DBLG. Without expressing any opinion
context of business and economics in as to the eventual recovery by LBA of
the 1980s. As far as this Report is its investment in DBLG, the Board
concerned, it is, however, appropriate decided on 26 March 1990 to write-off
to limit matters to setting out the effect SF 200.6 million, the value of Pargesa
of the event on Pargesa Group. Group's holding in DBLG. This amount
is equivalent to 100% of the value of
Pargesa holds 25.4% and GBL holds
57 % of Lambert Brussels Associates
Pargesa's indirect participation in DBLG.
(LBA), which in its turn holds 5,581,752

Class "C" Series 1, 3,721,168 Class "C"
Series 2, and 98,184 Class "E" shares in
DBLG.
The Class "C" Series 1 shares held by

LBA have the right to approximately
27% of the voting power of DBLG at
31 December 1989. The Class "C"
Series 2 and Class "E" shares have no
voting right.
40
INDUSTRY AND SERVICES
In the industry and services sector, the Industrial participations are selected
investments of Pargesa Group are according to two fundamental strategic
concentrated in a limited number of requirements. The first is to ensure
businesses and companies which are sufficient diversification to be prepared
considered to offer strong prospects for for changes in the economic situation.
the future. The second requires a regular pattern
of growth.
The Group aims to take part in the defi
nition of their strategies and to apply
the implementation of pohcies by
means of an active involvement with
their Directors and Managers.
4 2
R O YA L E BELGE
elgium's leading insurance subsidiaries, in every branch of the

group, Royal Beige is present, insurance business. It is also active in
directly or by means of its t h e fi n a n c i a l s e r v i c e s s e c t o r .
(BF million) 1989 1988 1987
Royale Vendome's participation' 45.6% 45.6% 44.0%
Equity 47,280 40,436 34,331
Net profit 3,466 3,411 3,076
Dividend per share* 130 11 8 106

' Belgian francs (ajusted) — 1. held equally by GBL and Union des Assurances de Paris (UAP)
Looking ahead to the European Single However, receipts from single premium
Market in 1993, Royale Beige intends to group insurance and personal accident
develop its policy of international insurance showed lower levels of
expansion with the support of its two performance.
principal shareholders, GBL and UAP.
After the realisation of new capital gains
Close co-operation with UAP-Nederland
on assets of BF 8.7 billion (SF 376.7
has just been brought into effect by
million), the potential capital gains at
means of the creation of Royale Beige
31 December 1989 are BF 36.2 bilhon
Internationale, which holds 39% of
(SF 1.6 billion).
UAP-Nederland Life and of UAP-Neder-
land lARD. The profit allows the company's ordinary
shares to have distributed to them a
The total of insurance premiums
dividend increased by 10.2% compared
received by the Royale Beige group
with that of the previous year.
reached BF 46 billion (SF 2 biUion), an
increase of 8%. This progress is primar
ily due to the very satisfactory level of
new business written in personal life
insurance, fire and motor assurance.
PETROFINA S.A.
etrofina is the largest Belgian parent company of an international

company in terms of stock group operating in every sector of the
market capitalisation. It is the oil industry.
(BF million) 1989 1988 1987
Equity 143,504 11 8 , 2 7 8 107,436
Net profit 21,822 20,191 17,544
Net profit per share* 1,007 1,002 967

■ Belaian francs — 1. and of its subsidiaries
Petrofina's profit (Group share) On the petrochemical side, in spite of

increased by 8%, reaching BF 21.8 less favourable market conditions,
billion (SF 943.9 million). profits continued to be very satisfactory.
In 1989, the group continued to make
The operations of the production sector
significant investments in this sector.
benefited from the rise in oil prices and
a significant increase in production of Petrofina has acquired the French
natural gas. Production of crude oil company LP.A., placing it in number
reached 5.9 million tonnes (an increase 3 position in the European household
of 4% compared with 1988), and natural paint market.
I gas production was 5.7 billion cubic In preparation for the European Single
i metres (an increase of 32% compared
Market in 1993, Petrofina has regrouped
with 1988).
most of its Common Market subsidiaries
The proven reserves of the group are into a company named Fina Europe
110 million tonnes crude oil equivalent whose objective is to achieve uniform
at the end of the year. In 1989, 112% of ity, harmony and integration of common
production was replaced. service operations for the European
subsidiaries.
The area for prospecting has grown by
46%, now extending over 57,800 square In 1989, the group's investment
kilometres at the end of 1989. expenses were in the region of BF 50
billion (SF 2.2 billion).
The distribution sector has profited from
sustained high levels of demand for oil The proposed net dividend is BF 416
products. The refineries worked at full (SF 18) per share, payable to 21,660,445
capacity both in Europe and the United shares.
States.
Sales of oil products exceeded 36 milhon

tonnes, representing an increase of
7.8% compared with sales volume in 1988.
44 PA R G E S A HOLDING S.A. - PA RT I C I PAT I O N S 1989

TRACTEBEL
tions are directed mainly towards the
Trace
tbelsi ahodlnigandresearch
and development company. It
consists of an international,
traditional sectors of energy and engi
neering, to industrial services and
widely diversified group whose opera communications.
(BF million) 1989 1988 1987
Equity 7 6 , 9 11 74,171 53,098
Net profit 8,767 9,534 6,785
Dividend per ordinary share* 295 285 270

* Belgian francs — 1. and of its subsidiaries
Consolidated net profit for the 1989 traditional operations. The Fabricom
financial year was BF 8.8 billion group has also continued to acquire
(SF 379.6 million). companies both in Belgium and other
countries.
Tractebel, Belgium's leader in produc
tion and distribution of electricity and Tractebel is also Europe's Number 1
gas, carries out its operations through private cable television operator, rank
Ebes, Unerg, Intercom, A.G.M. and ing among the world's top six compa
Distrigaz. Tractebel is the reference n i e s i n t h i s s e c t o r. C o d i t e l i s Tr a c t e b e l ' s
shareholder and industrial operator of principal subsidiary in this area, and is
these companies. The Ebes, Unerg and established in Belgium, France, Spain,
Intercom companies have decided in Switzerland and the United States. It is
principle to merge their activities within associated with the consortium that has
a single company in the course of 1990. been selected to build and run Hong
Tractebel Engineering, one of the Kong's cable television network. Codi-

tel's share in this investment represents
world's leading research and develop
ment operations, was able to take approximately BF 2.5 billion (SF 108.3
million). Tractebel has also taken
advantage of favourable market condi a holding in the American company
tions by winning a significant number of
ACT III which makes money from inde
new contracts.
pendent television stations and cine
Fabricom, Belgium's leading industrial mas, publishes magazines and also has
services company, is developing new interests in film production.
marketing initiatives (waste disposal
and recycling, thermal installations and
air conditioning) in parallel with its
COMPAGNIE LUXEMBOURGEOISE DE TELEDIFFUSION (CLT)
LT, which is Europe's longest with particular strength in television,

established radio station, has both in transmission, production and
important international multi international distribution, and also press
media businesses based in Europe, magazines,
(Lux F million) 1989 1988 1987
Audiofina's participation^ 5 6 . 6 % 56.6% 56.7%
Equity 6,7422 4,306 3,695
Net profit 196 881 1,126
Dividend per share* n . a . 80 96

■ Luxembourg francs (adjusted) — 1. and of subsidiaries — 2. before distribution
The Group's audiovisual interests are now on contribute in a very significant way
located in Audiofina which is held — to the improvement to the 1990 results.
directly or indirectly - 57% by GBL. At
Elsewhere, the successful launch of RTL
31 December 1989, Audiofina held
Ve r o n i c a i n t h e N e t h e r l a n d s i n a s s o c i a
5 6 . 6 % o f C L T.
tion with VNU and Elsevier together
In May and June 1989, CLT increased its with Joop van Ende, one of the leading
capital by Lux F 2,1 billion (SF 90.9 million). private Dutch production companies,
makes it possible to look forward to
The deterioration of profitability of RTL
increased profits in the near future.
Television (Luxemburg) and RTL Radio
in West Germany, together with the The profitability of RTL Radio has held
large provisions made for the M6 chan up well, and for the ninth consecutive
nel in France and Tele 5 in Germany year it has maintained its position as the
have weighed heavily against this year's leading French radio station by a wide
net profit, reduced from Lux F 881 margm. This continuing success points
milhon in 1988 to Lux F 196 milhon to a satisfactory development in the
(SF 8,5 milhon) in 1989, profits of CLT over the next few years.
It is to be noted that the results of RTL
Plus reached break-even point during
the last part of 1989, They should from
C O M PA G N I E I N T E R N AT I O N A L E DES WAGONS-LITS
ET DU TOURISME (WAGONS-LITS)
networks. In subsequent years, it
Fromh
teyearofsti o
fundaoitnni
1876, Wagons-Lits has operated
sleeping carriages and restaur
has launched into the tourism, hotel,
restaurant and car hire sectors.
ant cars on the great European rail
(BF million) 1989 1988 1987
Parfinance's participation 3.7% 4.0%
Equity 12,901 12,175 10,200
Net profit 1,462 2,684 1,038

* Belgian francs (adjusted) — 1. and of its subsidiaries
Wagons-Lits group achieved a consoli integration of the catering activities of

dated turnover of BF 96.4 billion (SF 4.2 the two companies.
bilhon), an increase of 20.5% compared
In an expanding market, companies in
with 1988. 1989 was the first year in
the Europcar International group expe
which the car hire operation reached its
rienced rapid growth in their business.
new trading level after the merger of
the Europcar and Inter-Rent networks. Finally, The Moorings and Kavos, two
In comparative terms, turnover companies specialising in the hire of
increased by 13%. pleasure boats, were sold in January
1990 to a group of institutional investors.
The rail sector made moderate progr
ess, its turnover increasing by 6%. The group's net consolidated profit
There was an increase in sales by the (Group share) is BF 1,462 miUion (SF
tourism sector of 15%. 63.3 million). This total is not directly
comparable with that of the previous
Hotel turnover showed an increase of
year in the course of which some large
13%. It was recently decided to bring
all hotel activities into a single subsidi exceptional profits had been realised.
The company's net profit is BF 1,416
ary operation, whose capital would million (SF 61.3 million). A net dividend
subsequently be open for a partner. of BF 129 (SF 5.6) per ordinary share
The restaurant sector, with a 13% incr will be proposed to the General Meet
ease, continued its expansion both in ing in May.
catering for organisations and fran-
chised public restaurants. Agreements
were reached in the course of the year
with Sodexho concerning the closer
S O C I E T E PA R I S I E N N E D ' E N T R E P R I S E S
ET DE PARTICIPATIONS (SPEP)
tions through its subsidiaries Merlin-
SPEPhodlsconro
tlofSchnedier
S.A., of whose equity it has 58.5%,
Schneider S.A. is a major private
Gerin, Telemecanique, SPIE Batignolles,
Jeumont Schneider in the fields of elec
French group. It carries out its opera trical energy, contracting and services.
(FF million) 1989E 1988 1987
Parfinance's participation 19.5 19.3% 20%
Equity 3,872 3,462 1,950
Net profit 603 409 107
* French francs (adjusted)
The policy of rationahsation of the group's (SF 70.6 million) additionally in the
structure has been continued. Jeumont- event that the options are fully exer
Schneider regrouped is activities within cised and convertible bonds for a total
three companies: JS Automatismes, of FF 469 million (SF 125.0 milhon),
JS Industries and JS Transformateurs, In 1989, SPEP showed a marked incr
contributing some of its operations to
ease in its consolidated net profit,
Merlin-Gerin. Schneider's participation
which was, in terms of Group share,
in Merlin-Gerin was thus increased to
FF 603 milhon (SF 160.7 million),
60%.
compared with FF 409 milhon in 1988.
This is due particularly to the increase
The group's financial resources were
in net profit (Group share) of Schneider,
i n c r e a s e d i n o r d e r t o a c h i e v e r e fi n a n c
which increased to FF 876 miUion (SF
ing of the acquisition of Telemecanique, 233.4 miUion), compared with FF 560
the total cost of which is FF 7.5 billion
miUion in 1988, associated with the
(SF 2.0 billion). Schneider consequently
excellent performances recorded by
issued in June for FF 2.4 billion
the operational subsidiaries.
(SF 639.6 million) convertible bonds (of
which 73% are convertible as from 1989);
in February 1990, SPEP carried out the
simultaneous issue of shares with
options to purchase shares, for a gross

total of FF 622 million (SF 165.8 million)
to which would be added FF 265 milhon
IMETAL
metal's assets are grouped in industrial minerals and metallurgy-

companies whose activities are sectors.
primarily in the building materials.
(FF million) 1989E 1988 1987
P a r fi n a n c e ' s participation 42.1% 28.1% 20.0%
Equity 3,381' 2,746 2,307

Net p r o fi t 470 5782 135
Net p r o fi t per share* 42.7 52.7 11 . 6
Dividend per share* n.a. 7.0 4.0

* French francs (adjusted) — 1. including proceeds from bond (repayable in shares) issue
2. including exceptional profit totalling FF 212 million,
Im^tal continued to concentrate its core Metaleurop has been reduced from
activities in the fields of production and 29% to 15%, and consequently this
distribution of building materials (roof company has been removed from the
ing, bricks and floor tiles) and industrial scope of consolidation.
minerals.
The withdrawal of the group from
External acquisitions were a feature of sectors which no longer form part of its
these activities, enabling Imetal to core business should be continued in
strengthen its position and market share the future, and it will give rise progres
in the building materials sector. The sively to substantial capital gains.
group thus became Europe's Number With the objective of financing the new
1 producer of natural slate when it took
acquisitions, Imetal issued in July bonds
control of Financiere d'Angers. Simi
repayable in shares with warrants. The
larly, the acquisition of tile and brick
total of this issue was FF 672 milhon
works in South West France, where the
(SF 179.1 million).
company was already active, made it
possible to complete and rationalise Consohdated net profit (Group share) is
Im^tal's operations in that region. More estimated at FF 470 million (SF 125.2
recently, the group has taken a 37% milhon), of which FF 72 milhon (SF 19.2
holding in France Alfa, a French million) is extraordinary profit. In 1988,
company that is a subsidiary of an consolidated profit was FF 578 million,
Italian ceramics producer. which included an exceptional profit of
FF 212 milhon.
Consistent in the application of its
pohcy, Imetal has proceeded with the
complete or partial disposal of
non-strategic assets. Its participation in
COMPAGNIE FRANQAISE
DE L'AFRIQUE OCCIDENTALE (CFAO)
stablished in 31 countries tion in international trade. The group is

(Europe, Africa, Caribbean, active also in transport, rental of construc
South Pacific, North America), tion equipment for public works, hold
CFAO occupies a very important posi ing companies and real estate,
(FF million) 1989E1 1988 1987
Parfinance's participation 14.8% 13.3% 12.1%
Equity 4,317 3,655 3,257
Net profit 302 377 307
Dividend per share* 11 . 4 11 . 4 10.5
* French francs (adjusted)
At the start of 1989, CFAO took control of ary CICA to administer the major part of
the Ruche Meridionale chain of hyper its automobile distribution business
markets. The total cost of this operation which was previously managed directly
was FF 1.5 billion (SF 400 million), two by CFAO.
thirds of which was paid for in cash, the
Finally, there was a modification in the
remaining being financed by the issue CFAO shareholding with the entry of
of convertible bonds. This holding,
the French group Pinault whose holding
within which the group's other large
is at the level of 20%.
scale distribution subsidiaries had been
regrouped, was disposed of at the start Consohdated net profit (Group share)
of 1990. for 1989 is FF 302 million (SF 80.5 mil
lion), compared with FF 377 million for
CFAO strengthened its position as a
the previous year. Excellent performances
supplier of equipment for public works achieved by CDME (France's Number 1
by the acquisition of the Canadian com distributor of electrical equipment, 88%
pany Perco and by the purchase, for the
sum of US$ 323 miUion (SF 497.4 million) holding) had their effect reduced by
the requirement for new provisions in
of 100% of the equity of the American
Africa and by significant expenses aris
company Prime Equipment Corp.
ing from recent acquisitions.
The company carried out a simplifica
tion of its administrative systems by the
introduction of the specialised subsidi
SWIPAR HOLDING AG (SWIPAR)
ounded in 1987, Swipar's stra good prospects for development,

tegy is to provide support, by but where the capital is not sufficient
means of minority shareholdings, for their growth potential to be fully
in established businesses that have exploited.
(SF million) 1989 1988 19871
Participation of Paribas (Suisse) 10.0% 10.0% 10.0%
Equity 84.9 82.8 80.2
Net profit 2.1 2.5 (19.8)

1. exceptional financial year of nine months only
In July 1989, Swipar took a participation of Swipar totals SF 50 million, represent

in the capital of Aeroleasing Holding, a ing half of the equity subscribed at the
company specialising in air taxis for formation of the company.
private companies and international
Several other projects are near to
organisations, together with overhall,
completion. They too involve service or
maintenance, sales and leasing of
industrial companies where there are
aircraft. The company's turnover was
SF 100 million in 1987 and SF 150 million
prospects for going pubhc within three
to four years.
i n 1 9 8 8 w i t h c a s h fl o w s o f S F 8 . 7 m i l l i o n
and SF 17.8 million respectively. Results Swipar's increased its shareholding in
of the 1989 financial year have achieved Rinsoz & Ormond (see the following
the budgeted targets. page) to 19% in the context of restruc
This operation enabled Swipar to act as turing operations of the shareholding of
that company.
catalyst for its partners. In fact, following
the participation by Swipar, the Sicpa Swipar's participahon in Model Holding,
group also took a significant holding in a family company with several factories
the equity of Aeroleasing. producing cardboard, corundum ceramic
grinding wheels, and recycling plastics,
During autumn 1989, a "going public"
came into effect in January 1989. The
debenture loan was successfully
participation has been taken with the
launched by Aeroleasing, administered
objective of selling shares of this group to
by Paribas Suisse. A public offering the public.
should follow within the next two years.
This operation has required the call of
SF 10 million of Swipar's share capital.
Consequently, today the paid-in capital
RINSOZ & ORMOND
his Swiss industrial group origi the businesses of food production and
nally started in the tobacco sector. distribution. The company is quoted on
Today it is also diversified into the main Swiss stock markets.
(SF million) 1989 1988 1987
1 5 %
Pargesa's participation
Swipar Holding's participation 19%
Equity 101.1 69.7 69.0
Net profit 6.2 3.9 3.7

* Swiss francs
Negotiations carried out with a group of Sale in the tobacco sector decreased
investors enabled Pargesa Holding S.A. by 0.6%, this being a less marked fall
to raise its stake to 15%. than that seen in previous years.
Consolidated net profit of Rinsoz & Samvaz, a company held 49% by Rinsoz
Ormond is SF 6.2 million, compared & Ormond, manufactures and markets
with SF 3.9 million in 1988. The growth products for the construction industry
in profit per share is 20%. (fasteners, tools, girders). Its sales
increased by 14% to SF 26.5 million in 1989.
In the course of the financial year, the
company continued to build up its food For Rinsoz & Ormond, 1989 was a year
production and distribution sector. The marked by internal rationalisation and
share of the food business in the total reorganisation. The benefits of these
consolidated turnover (disregarding the measures will start to come into effect
amount received as tobacco tax) today in 1990.
is close to 50%.
Aux Planteurs Reunis, a 100% subsidiary

that is specialised in the provision of
luxury food products to top hotels and
restaurants, recorded a 20% increase in
its sales, which reached SF 64.5 million,
with a better than proportionate increase
in its profit.
O T H E R D I R E C T PA R T I C I PAT I O N S
P A R G E S A B A N K C O R P. PA R G E S A L U X E M B O U R G S . A .
Pargesa Holding has 100% of the capital This 100% owned subsidiary concen
of Pargesa Bank Corp., incorporated in trates the main part of Pargesa Group's
the Cayman Islands. It acts mainly as a cash management activities. It thus ope
financial intermediary for placings in the rates in currency and money markets,
Euromarket and for short-term opera and takes responsibility for the manage
tions in international capital markets. ment of share and bond portfolios.
In June 1989 it issued a loan of Lux F 3.3

B R U G E PA R S . A .
biUion (SF 142.9 miUion), at an interest
rate of VA for a term of 5 years. This Jointly owned by Pargesa Luxembourg
loan is repayable in shares of the parent S.A. and a subsidiary of Groupe Bruxelles
Company at the end of the term. Lambert S.A., this Luxemburg holding
company holds participations in some of
PA R G E S A B E L G I Q U E S . A . the Group's subsidiaries.
This 99.9% owned subsidiary incorpo

F I N A N C I E R E D U PA R C B . V.
rated in Belgium has the function of
making direct investments in Belgium. This 100% held subsidiary manages
share portfolios.
PA R G E S A N E T H E R L A N D S B . V.
The objective of this 100% owned

subsidiary is to hold certain long term
investments of the Pargesa Group.
It currently holds participations in Societe

Financiere de Paribas Suisse B.V.,
Groupe Bruxelles Lambert S.A., Henry
Ansbacher Holdings Pic, and Banque
Internationale a Luxembourg.
C O M PA N Y ACCOUNTS
SUMMARY
1989 1988 1987 1986
Market capitalisation (SF million) 2,295.4 1,749.6 1,345.1 2,416.6

Consolidated equity (SF million) 1,940.6 1,638.2 1,431.0 1,440.6
Consolidated results^ (SF million) 207.5 162.2 161.7 150.1
Dividend (SF million) 75.2 71.1 67.8 58.2
Consolidated result per share*^ (SF) 179.4 147.5 147.1 149.5
Dividend per share* (SF) 65.0 64.7 61.7 57.9
* adjusted — 1. before exceptional item
PA R G E S A H O L D I N G S . A . ■ C O M PA N Y A C C O U N T S 1 9 8 9 5 5
C O N S O L I D AT E D B A L A N C E S H E E T A S AT 3 1 D E C E M B E R
ASSETS SF SF
1989 1988
Current assets:
Sight deposits with banks 1,589,266 10,626,953

Other sight deposits 4,832 8,102
Short term deposits with banks 106,092,217 131,166,872
Securities (Note 4) 142,207,052 145,852,129
Other assets and accrued income 13,995,292 16,041,098
To t a l c u r r e n t a s s e t s 263,888,659 303,695,154
Fixed assets:
Unconsolidated investments (Note 5):

— shares 55,543,640 13,992,820
- bonds
118,947,698 73,506,975
Share of equity of affiliates
subject to equity accounting (Note 2c) 1,747,228,723 1,565,270,545
To t a l fi x e d a s s e t s 1,921,720,061 1,652,770,340
Deposit with an affiliated bank (Note 6) 235,908,000 99,908,000

Loans to affiliated companies 6,045,246 6,040,920
Total long term assets 2,163,673,307 1,758,719,260
Intangible assets:
Goodwill net (Note 7) 95,468,199 94,959,936
TOTAL 2,523,030,165 2,157,374,350
56 PA E G E S A H O L D I N G S . A . - C O M PA N Y A C C O U N T S 1 9 8 9
LIABILITIES AND SHAREHOLDERS' EQUITY SF SF C O N S O L I D AT E D
1989 1988
Liabilities:
Due to banks on sight 522,609 9,381,270

Due to banks at short term 64,447,000 155,109,075
To t a l d u e t o b a n k s 64,969,609 164,490,345
Other sight liabilities 656,598

Other short term liabilities 2,146,779 510,141
Accrued liabilities and provisions 44,194,508 35,788,877
To t a l c u r r e n t l i a b i l i t i e s 111,310,896 201,445,961
Loan from an affiliated company 890,232 812,136
Debenture loan with warrants (Note 8) 184,000,000 176,500,000

Debenture loans (Note 9) 143,300,000 140,400,000
To t a l l i a b i l i t i e s 439,501,128 519,158,097
Quasi shareholders' equity:
Debenture loans
repayable in shares (Note 10) 142,890,000
Shareholders' equity:
Share capital (Note 11) 1,455,850,000 1,193,500,000

Legal reserve 178,361,730 123,697,653
Available consolidation reserve (Note 12) 236,635,546 322,123,487
Currency conversion adjustment (28,593,549) (84,993,844)
Retained earnings 98,385,310 83,888,957
Total shareholders' equity 1,940,639,037 1,638,216,253
TOTAL 2,523,030,165 2,157,374,350
PA R G E S A H O L D I N G S . A . - C O M PA N Y A C C O U N T S 1 9 8 9 57
C O N S O L I D AT E D P R O F I T A N D L O S S A C C O U N T
A S AT 3 1 D E C E M B E R
SF SF
1989 1988
Operating income:
Interest 9,240,184 7,305,817

Commissions 1,708,352 3,512,691
Income from securities:
— dividends and interest
4,043,358 5,541,003
— capital gains on sales 16,140,895 32,298,131
Income from investments:

— dividends 2,844,188 2,181,140
— interest on bonds 10,145,634 7,289,589
— share of profits of companies
subject to equity accounting 177,759,012 141,605,741

Other income 176,870
Total operating income 221,881,623 199,910,982
Operating expenses:
Interest on borrowings 10,288,219 8,271,442

Interest on debenture loans 20,444,903 13,532,756
Foreign exchange and arbitrage expenses 3,313,881 2,739,655
Commissions and bank charges 191,104 1,197,273
Directors' remuneration and salary costs 4,182,636 3,747,625
General and administrative expenses 2,879,005 2,684,699
Total operating expenses 41,299,748 32,173,450
Net operating income 180,581,875 167,737,532
58 PA R G E S A H O L D I N G S . A . C O M PA N Y A C C O U N T S 1 9 8 9
SF SF C O N S O L I D AT E D
1989 1988
Income from capital operations:
Gains on sales of investments 44,692,890 5,335,174
Expenses incurred on capital operations:

Provisions for unrealised losses on participations 2,350,817 2,413,097
Net income on capital operations 42,342,073 2,922,077
Net amortisation of consolidation goodwill 13,398,819 5,618,742

Ta x e s 2,020,624 2,882,540
Profit before extraordinary expenses 207,504,505 162,158,327
Extraordinary expenses:
Amortisation of investment
in The Drexel Burnham Lambert Group Inc. 200,610,752
Amortisation and provisions 2,291,861 1,000,000
Charges on debenture loan 947,378
Total extraordinary expense (202,902,613) (1,947,378)
Net profit for the year 4,601,892 160,210,949
SF SF
1989 1988
A L L O C AT I O N O F AVA I L A B L E P R O F I T

Available consolidation reserve
from previous year 322,123,487 243,928,430
Retained earnings from previous year 83,888,957 76,152,295
Allocation to available reserves (2,496,526)
410,614,336 477,795,148
A L L O C AT I O N S MADE
Allocation to legal reserve 4,510,000 3,980,000

Dividend 71,083,480 67,802,704
Retained earnings brought forward 98,385,310 83,888,957
Available consolidation reserve 236,635,546 322,123,487
Sub-total 335,020,856
410,614,336 477,795,148
A L L O C AT I O N P R O P O S E D TO T H E
SHAREHOLDERS' MEETING OF 1 JUNE 1990
Allocation to legal reserve 4,010,000

Dividend 75,189,855
Retained earnings brought forward 99,327,115
Available consolidation reserve 156,493,886
335,020,856
60 PA R G E S A HOLDING S.A. - C O M PA N Y ACCOUNTS 1989

C O N S O L I D AT E D CASH FLOW S TAT E M E N T
FOR FINANCIAL YEARS ENDING ON 31 DECEMBER
C O N S O L r o AT E D SF SF
1989 1988
Operating activities:
Net p r o fi t for the year 4,601,892 160,210,949
Amortisation and provisions 146,556,834 9,031,839
Share of results of companies subject
to equity accounting net of dividends received (54,706,600) (69,980,049)
Net cash provided

by operating activities 96,452,126 99,262,739
Investment activities:
Net (purchases) sales of long term investments (238,943,042) 26,846,468

Net purchase of bonds (46,838,400) (413,994)
Repayment of loans from affiliated companies 73,770 1,406,200
Net cash used

in investment activities (285,707,672) 27,838,674
Financing activities:
Issue of bonds 132,837,244 40,400,000
Share capital increase 126,350,000
Share premium 50,154,077
Va r i a t i o n o f o t h e r a s s e t s a n d s h o r t t e r m
income net of short term liabilities and provisions 10,451,437 (11,483,605)
Dividend paid (71,083,480) (67,802,704)
Net cash provided

by fi n a n c i n g activities 248,709,278 (38,886,309)
Increase in cash and deposits
(including securities) net of bank
and similar liabilities 59,453,732 88,215,104
Cash and deposits

and similar habilities at beginning of year 128,897,108 40,682,004
Cash and deposits

and similar liabilities at end of year 188,350,840 128,897,108
Net increase 59,453,732 88,215,104
PA R G E S A H O L D I N G S . A , - C O M PA N Y A C C O U N T S 1 9 8 9 61
N O T E S T O T H E C O N S O L I D AT E D A C C O U N T S
A S AT 3 1 D E C E M B E R 1 9 8 9
1. ACTIVITY Investments in affiliates, which are 20%

to 50% directly or indirectly owned, are
Pargesa Holding S.A. is incorporated at
accounted for by using the equity
the Register of Commerce of the canton
method.
of Geneva (Switzerland). Its principal
object is to buy, sell, direct and manage
2b) Consolidation goodwill
investments in the financial, commercial,
industrial and, in particular, the banking The consohdation goodwill represents
sectors, both in Switzerland and in other the excess of the book value (at
countries. purchase price) of investments subject
to equity accounting over the value of
2. SUMMARY OF SIGNIFICANT their net underlying assets at the date
ACCOUNTING POLICIES o f t h e fi r s t u s e o f t h e m e t h o d ,
T h e c o n s o l i d a t e d fi n a n c i a l s t a t e m e n t s
Consohdation goodwill is amortised
have been prepared according to the
over a period not exceeding 40 years.
following principles:
2a) Consolidation scope
Full consolidation is applied to

subsidiaries in which more than 50% of
the share capital is held.
2c) Fully consolidated companies and companies subject to equity accounting
Percentage
F U L LY C O N S O L I D AT E D C O M PA N I E S : held
Pargesa Bank Corp., Grand Cayman 100.0

Pargesa Netherlands B . V. , Rotterdam 100.0
Pargesa Luxembourg S.A., Luxemburg 100.0
Financiere du Pare B . V. , Rotterdam 100.0
Pargesa Belgique S.A., Brussels 99.9
C o m p a g n i e d e Va l o r i s a t i o n I n d u s t r i e l l e C o v a l o r S . A . , F r i b o u r g 1 0 0 . 0
COMPANIES SUBJECT TO EQUITY ACCOUNTING:
Banque Paribas (Suisse) S.A., Geneva 25.5

Groupe Bruxelles Lambert S.A., Brussels 31.1
Lambert Brussels Associates Limited Partnership, Bermuda 25.4
Banque Internationale a Luxembourg, Luxemburg 27.9

Henry Ansbacher Holdings Pic., London 24.0
P a r fi n a n c e , Paris 28.6
Soporgest S.A., Luxemburg 45.0

Brugepar S.A., Luxemburg 50.0
Swipar Holding AG, Zurich 21.5
62 PA R G E S A H O L D I N G S . A , - C O M PA N Y A C C O U N T S 1 9 8 9
3. ACCOUNTING PRINCIPLES The following exchange rates where
The accounting principles followed by applied for the preparation of these

accounts:
the Company are in accordance with
international standards, 1989 1988
US$ 1,54 1.515

3a) Recognition of income and DM 91,10 84.75
expenses FF 26,65 24.85

BF-Lux F 4.33 4.04
Income and expenses are accounted
£ 2.4725 2.7175
for as and when they are acquired or
ECU 1,84 1.765
incuned (and not at time of receipt or
payment), and are included in the
3c) Securities
accounts in the period to which they
relate. Securities are carried in the balance
sheet at the lower of cost or market
3b) Conversion of foreign currencies value,
Assets and liabilities in foreign

3d) Unconsolidated investments
currencies are converted into Swiss
francs at the exchange rates applicable Unconsolidated investments are carried
on the balance sheet date, with the in the balance sheet at the lower of cost
exception of unconsohdated or estimated value.

investments which are accounted for at
cost and converted at historical rates, Notes and bonds are valued at their par
value in foreign currencies, converted
Foreign exchange gains or losses at the lower of historical or current rate,
resulting from consohdation or the use
of equity accounting of the Company's
3e) Expenses of share capital increase
attributable share of equity translated at
and incorporation
the exchange rate prevailing at the
balance sheet date, compared to the Expenses of share capital increase are
historical rate, are recorded in the fully amortised. Expenses of
account" Currency conversion adjustment", incorporation are amortised in the
Income and expenses are converted at period in which they are incurred.
the exchange rates prevailing at the
3f) Expenses of debenture loan issues
date of each transaction.
Expenses of debenture loan issues are

Foreign exchange gains or losses are
credited or charged to the profit and fully amortised in the financial year in
which they are incurred.
loss account in the period in which they
arise, except adjustments made in
respect of debenture loans repayable in
shares, which are booked to "Currency
conversion adjustment".
PA R G E S A H O L D I N G S . A . - C O M PA N Y A C C O U N T S 1 9 8 9 6 3
3g) Taxes 3h) Share of the net income of com
panies subject to equity accounting
The Company provides for taxes when
profits are earned irrespective of due This item includes the Company's share
dates. in the consolidated or non-consohdated
net income of the companies subject to
equity accounting.
4. SECURITIES
The breakdown of the book value of securities in the portfolio is as follows:
Swiss shares: SF
-Banks 11 3 , 2 4 3
— Financial institutions 14,718
— Industrial companies 18,780,439
To t a l of Swiss shares 18,908,400
Foreign shares:
-Banks 68,141,054
— Financial institutions 7,126,933
- Industrial companies 4,418,054
To t a l of foreign shares 79,686,041
To t a l of shares 98,594,441
Investment fund c e r t i fi c a t e s 5,177,760
Foreign bonds:
- Public institutions 5,442,210
- Others 32,992,641
To t a l of bonds 38,434,851
To t a l 142,207,052
Shares and bonds are valued at the lower of cost or market value.

5 . U N C O N S O L I D AT E D I N V E S T M E N T S - S F 1 7 4 , 4 9 1 , 3 3 8 P e r c e n t a g e C O N S O L I D AT E D
held
Lambert Brussels Associates Limited Partnership, Bermuda:
— Va r i a b l e r a t e d e b e n t u r e n o t e s m a t u r i n g o n 3 0 J u n e 1 9 9 8 —
Banque Internationale a Luxembourg, Luxemburg:

— 7% convertible Banque Internationale a Luxembourg debenture
loan, maturing on 31 December 1997 —
— 5.5% Banque Internationale a Luxembourg debenture
loan with warrants, maturing on 1 December 1996 -
Trans Capital B.V, Amsterdam

— Variable interest debenture notes maturing in 1995:
— Junior Participating Notes —
— Senior Participating Notes —
Henry Ansbacher Holdings Pic., London

— Convertible subordinated unsecured loan stock
9% maturing 30 June 1998 -
Parfinance, Paris
— Bonds repayable in shares
7,5% maturing 1 January 1997 -
TransCapital Holding B.V, Amsterdam

— Shares 50.0
Rinsoz & Ormond, Vevey

— Shares 15.0
EMG Holding S.A., Brussels

— Shares 10.5
Michel Vineyards Inc., Wilmington, Delaware

— Shares 6.6
LB. Finance S.A., Luxemburg

— Shares 4.9
International Asset Management Company S.A., Luxemburg

— Shares 2.1
Euro Pacific Advisers Ltd,, Hong Kong

— Shares 2,5
PA R G E S A HOLDING S.A. - C O M PA N Y ACCOUNTS 1989 65

6 . D E P O S I T W I T H A N A F F I L I AT E D S F
BANK - SF 235,908,000 Goodwill as at 31 Dec. 1988 94,959,936

Net increase of goodwill 13,907,082
This amount is a frozen deposit with the
Net amortisation of the year (13,398,819)
Banque Internationale a Luxembourg, Goodwill net
guaranteeing the par value of the
as at 31 Dec. 1989 95,468,199
reserved shares created to cover;
— SF 99,908,000 for the warrants issued 8. DEBENTURE LOAN WITH

in July 1986; WARRANTS - SF 184,000,000
— SF 70,000,000 for the exercise of The 4% debenture loan with warrants —
options held by beneficiaries of the ECU 100 million — was issued by

"Incentive Plan", introduced by the Pargesa Bank Corp. in July 1986, for a
Company to replace the previous plan period of ten years to 30 July 1996. Each
based on participation certificates. warrant entitles its holder to buy one
— SF 66,000,000 committed for payment bearer share of Pargesa Holding S.A. at
SF 2,224 until 30 July 1991.
at the end of the term of debenture
loan issues made in June 1989.
9. DEBENTURE LOANS
- SF 143,300,000
7. GOODWILL - SF 95,468,199
A SF 100 million — 4y4% non-callable
The residual amount of goodwill derives
debenture loan — was issued by the
essentially from the difference between
Company in July 1987, for a fixed term of
the purchase price of investments and
8 years to 6 July 1995.
the share of their equity attributable to
A 7% non-callable debenture loan — for
the Company proportionally to its
Lux F 1,000,000,000 (SF 43,300,000) -
investment.
was issued by Pargesa Bank Corp. in
The residual goodwill is justified by the May 1988 for a fixed term of 8 years to
market price of listed companies as 26 May 1996.
well as the latent reserves of the
subsidiaries in which the Company has
a permanent investment. It is amortised
on a straight-line basis over ten years.
66 PA R G E S A H O L D I N G S , A . - C O M PA N Y A C C O U N T S 1 9 8 9
1 0 . D E B E N T U R E L O A N S R E PAYA B L E Lux F 50,000 and Lux F 5,000 C O N S O L I D AT E D
IN SHARES - SF 142,890,000 respectively will be converted into one

The lVz% debenture loans repayable in Pargesa Holding S.A. share with a
nominal value of SF 1,000 (bearer share)
shares — Lux F 3,300,000,000 were
and SF 100 (registered share)
issued by Pargesa Bank Corp. in June
1989 for a fixed 5 year term, maturing respectively. The total conversion value
amounts to SF 132,837,244 (historic
on 29 June 1994. Each debenture loan of
conversion rate).
11. SHARE CAPITAL - SF 1,455,850,000
The Company's share capital is made up as follows: SF

- 1,263,500 registered shares, each SF 100 par value,
fully paid in (1988: 1,085,000 shares) 126,350,000
- 1,093,592 bearer shares, each SF 1,000 par value,
fully paid in (1988: 985,092 shares) 1,093,592,000
- 60,000 registered reserve shares, each with SF 100 nominal value,
fully paid in, with no dividend right 6,000,000
- 229,908 bearer reserve shares, each with SF 1,000 nominal value,
fully paid in, with no dividend right 229,908,000

(see also note 6). 1,455,850,000
4,774,000 participation certificates are authorised, each SF 100 par value: not
issued.
The bearer shares are listed on the Geneva, Zurich and Basel Stock Exchanges.
Reconciliation of shareholders' equity
Situation as at 31 December 1988 1,638,216,253

Dividend approved by the Shareholders' Meeting on 29 May 1989 (71,083,480)
Currency conversion adjustment for the year 56,400,295

Income from capital increases:
- capital 262,350,000
- legal reserve 50,154,077
Sub-total 1,936,037,145
Net p r o fi t for the year 4,601,892
Shareholders' equity as at 31 December 1989 (before allocation) 1,940,639,037
PA R G E S A H O L D I N G S . A . - C O M PA N Y A C C O U N T S 1 9 8 9 6 7
1 2 . AVA I L A B L E C O N S O L I D AT I O N R E S E RV E - S F 2 3 6 , 6 3 5 , 5 4 6
This item represents the share of reserves of companies consolidated or subject to

equity accounting which is attributable to the Company, proportionate to its
investment.
13. CONTINGENCIES AND OTHER LIABILITIES
— Liabilities arising from purchases and disposals of shares 15,357,300

— Liabilities arising from forward exchange contracts 143,516,250
— Guarantees issued in respect of third parties 14,579,000
173,452,550
1 4 . R E L AT E D PA R T Y B A L A N C E S A N D T R A N S A C T I O N S
Assets:
— Sight and demand deposits with banks 1,249,579
— Short term deposits with banks 78,289,056
— Other assets and accrued income 3,184,299
— Loans to affiliated companies 6,045,246
Liabilities:
— Due to banks on demand 497,787
— Due to banks at short term —
— Other demand liabilities —
— Other short term liabilities 2,146,779
— Accrued habilities and provisions 534,019
— Loan from affiliated company 890,232
15. MAJOR TRANSACTIONS CARRIED

O U T W I T H A F F I L I AT E S O R I N
W H I C H A F F I L I AT E S W E R E
INVOLVED
— Subscription to the capital increase of

Groupe Bruxelles Lambert S.A. in
January 1989 by the contribution of
181,728 Petrofina S.A. shares.
68 PA R G E S A H O L D I N G S . A . - C O M PA N Y A C C O U N T S 1 9 8 9
AUDITORS' REPORT TO THE SHAREHOLDERS' MEETING
C O N S O L I D AT E D Geneva, 1 May 1990
We have audited the consolidated The financial statements of companies

financial statements of Pargesa Holding subject to equity accounting,
S.A, and its subsidiaries, as at 31 De representing 58% (1988: 58%) of
c e m b e r 1 9 8 9 a n d 1 9 8 8 . T h e s e fi n a n c i a l consohdated assets and 69% (1988:
statements are the responsibility of the 56%) of total operating income, have
Company's Management. Our been examined by other auditors. Our
responsibility is to express an opinion opinion expressed hereafter, to the
o n t h e s e fi n a n c i a l s t a t e m e n t s b a s e d o n extent to which it relates to the
our audit. integration of the accounts of these
We conducted our audit in accordance
companies, is based on the conclusions
of the said auditors.
with generally accepted auditing
standards. These standards require that In our opinion, on the basis of our own
we plan and perform the audit to obtain examination and the reports of other
reasonable assurance about whether a u d i t o r s , t h e s e c o n s o l i d a t e d fi n a n c i a l
t h e fi n a n c i a l s t a t e m e n t s a r e f r e e f r o m statements present in all material
significant errors. respects the financial position of
An audit includes the examining, on a Pargesa Holding S.A. and its
subsidiaries as at 31 December 1989
test basis, of the evidence supporting
and 1988 and the results of their
the figures and other information in the
fi n a n c i a l s t a t e m e n t s . A n a u d i t a l s o
operations and cash-flow for the years
includes assessing the accounting ending on those dates, in accordance
with international accounting principles
principles used, and significant
apphed on a consistent basis.
estimates made by Management as well
as evaluating the overall financial Ernst & Young S.A.
statements' presentation.
We believe that our audit provides a

reasonable basis for our opinion.
S TAT U TO RY B A L A N C E S H E E T A S AT 3 1 D E C E M B E R
ASSETS SF SF
1989 1988
Current assets:
Due from banks on sight:

— Affiliated banks 77,642 25,991
To t a l due from banks 77,642 25,991

L o a n t o a f fi l i a t e d c o m p a n y ( c u r r e n t l y d u e p o r t i o n ) 6 , 0 0 0 , 0 0 0 1 5 , 8 3 5 , 2 6 0
Securities 11 4 , 8 5 4 11 5 , 0 3 8
To t a l current assets 6,192,496 15,976,289
Deposit with a f fi l i a t e d bank 235,908,000 99,908,000
Fixed assets:
Long term investments 633,044,938 702,538,154

L o a n t o a f fi l i a t e d c o m p a n y ( l o n g te r m p o r ti o n ) 1 ,0 2 7 ,0 2 0 ,3 9 7 8 4 5 ,7 1 5 ,4 6 2
Other assets 15,673,992 20,907,855
To t a l fi x e d assets 1,675,739,327 1,569,161,471
To t a l 1,917,839,823 1,685,045,760
Assets located abroad 1,880,259,394 1,664,874,908
of which:
— deposits with bank
of 90 days' or less term 14,266 —
— deposits with bank
of over 90 days' term 235,908,000 105,908,000
LIABILITIES SF SF S TAT U T O R Y
1989 1988
Current liabilities:
Due to bank on sight:

— Affiliated banks
334,686 264,801
— Other banks 18
3,925
To t a l d u e t o b a n k s a t s h o r t t e r m 338,611 264,819
Provision for taxes and other liabilities 4,762,512 5,154,380
To t a l c u r r e n t l i a b i l i t i e s 5,101,123 5,419,199
Long term liabilities:

Loan from an affiliated company 8 8 , 4 5 0 , 11 8
Debenture loan 100,000,000 100,000,000
Total long term liabilities 100,000,000 188,450,118
Shareholders' equity;
Share capital 1,455,850,000 1,193,500,000

Legal reserve 178,361,730 123,697,653
Available profit 178,526,970 173,978,790
Total shareholders' equity 1,812,738,700 1,491,176,443
To t a l 1,917,839,823 1,685,045,760
G u a r a n t e e s f o r a n a f fi l i a t e d b a n k
and affiliated companies 886,086,500 852,973,000
S TAT U TO RY P R O F I T A N D L O S S A C C O U N T
A S AT 3 1 D E C E M B E R
SF SF
1989 1988
Income
Operating income:
Interests 191,064 62,277
Commissions 1,011,551 1,072,888
Gains on foreign exchange 382,506
Income from securities:

— Dividends 4,080 3,944
Income from long term investments:

— Dividends
199,783,613 97,471,864
— Interest on bonds
2,195,842 1,914,497
Other income from investments 452,109 176,870
Total operating income 204,020,765 100,702,340
SF SF S TAT U T O R Y
1989 1988
Expenses
Operating expenses:
Interest on bond issue 4,750,000 4,750,000
Commissions and bank charges 348,297 331,636
Losses on foreign exchange 45,423
Directors' and staff remuneration 3,977,253 3,605,314
Administrative and general expenses 1,933,134 1,966,384
Total operating expenses 11,008,684 10,698,757
Operating profit before taxes 193,012,081 90,003,583

Ta x e s (1,905,045) (2,429,300)
Operating profit after taxes 191,107,036 87,574,283
Extraordinary income (expenses):
Withdrawal (constitution) of provision

for unrealized losses on securities held (110,573,514) 2,515,550
Extraordinary amortisations (391,862)
Total extraordinary income (expenses) (110,965,376) 2,515,550
PROPOSAL OF THE BOARD OF DIRECTORS
C O N C E R N I N G T H E A L L O C AT I O N
O F AVA I L A B L E P R O F I T A S AT 3 1 D E C E M B E R 1 9 8 9
SF SF
1989 1988
Available profit:

Retained earnings brought forward 98,385,310 83,888,957
Available profit 178,526,970 173,978,790
Allocation:
Legal reserve 4,010,000 4,510,000

Dividends 75,189,855 71,083,480
Retained earnings carried forward 99,327,115 98,385,310
To t a l a l l o c a t e d 178,526,970 173,978,790
If the proposal is approved, the 2. For each registered share of SF 100

dividend of the financial year to par value, issued before 1 January 1989,
31 December 1989 will be payable as paid directly by Pargesa Holding S.A.:
follows:
Gross (less the 35%
1, For each bearer share of SF 1,000 federal withholding tax) SF 6.50
par value, issued before 1 January 1989,
For each registered share of SF 100 par
on presentation of coupon No. 13:
value, issued in June 1989, paid directly
Gross (less the 35% by Pargesa Holding S.A.:
federal withholding tax) SF 65.00
Gross (less the 35%
For each bearer share of SF 1,000 par federal withholding tax) SF 3.25
value, issued in June 1989, on
presentation of coupon No. 13:
Gross (less the 35%

federal withholding tax) SF 32.50
These coupons will be payable from

5 June 1990 at Banque Paribas (Suisse)
S.A., Union de Banques Suisses and
Credit Suisse.

S TAT U T O R Y A U D I T O R S ' R E P O R T
TO THE SHAREHOLDERS' MEETING
S TAT U T O R Y Geneva, 19 March 1990
As Auditors of your Company, we have On the basis of our examination, we

examined the accounts as at 31 recommend that you approve the
December 1989, as required by the accounts which are submitted to you.
provisions of the law. W e a l s o c o n fi r m t h a t t h e D i r e c t o r s '
We have come to the conclusion that:

proposal as to the allocation of the
retained earnings is in compliance with
— the balance sheet and the statement the legal requirements and the
of profit and loss are in agreement Company's statutes.
with the books of account;
— the books of account have been Ernst & Young S.A.
properly kept;
— the information as to the financial
position and the results of operations

are presented in accordance with the
principles of evaluation prescribed
by the law and the statutes.
PA R G E S A HOLDING S.A. - C 0 M PA > J Y ACCOUNTS 1989 75

PA R G E S A H O L D I N G S . A .
11, Grand-Rue • CH-1204 Geneva • Switzerland

Tel.; (22) 2189 25 • Telex: 421654 • Fax: (22) 2883 84
GROUPE BRUXELLES LAMBERT S.A.
24, Avenue Marnix ■ B-1050 Brussels • Belgium

Tel.: (2) 517 2111 • Telex: 21760 - Fax: (2) 517 22 85
T H E L A M B E R T B R U S S E L S C A P I TA L C O R P O R AT I O N
Chrysler Building (42nd Floor) • 405, Lexington Avenue • New York, N.Y. 10174 • U.S.A.
Tel.: (212) 687 83 00 • Telex: 426 287 • Fax: (212) 286 09 21
PA R F I N A N C E
9, Avenue Percier • F-75008 Paris • France

Tel.: (1) 42 25 34 40 • Telex: 648 594 • Fax: (1) 42 89 14 20
BANOUE PARIBAS (SUISSE) S.A.

2, Place de Hollande • CH-1204 Geneva ■ Switzerland
Tel.: (22) 787 7111 • Telex: 422165 • Fax: (22) 787 8000
B A N O U E I N T E R N AT I O N A L E A L U X E M B O U R G
69, route d'Esch • L-2953 Luxemburg
Te l . : 4 5 9 0 - 1 ■ Te l e x : 3 6 2 6 • F a x : 4 5 9 0 2 0 1 0
HENRY ANSBACHER HOLDINGS PLC.
Priory House • One Mitre Square ■ London EC3A SAN • Great Britain
Tel.: (71) 283 25 00 • Telex: 884 580 ■ Fax: (71) 626 0839
The original Annual Report in French, and the German translation, are available on
demand from the Company's headquarters.
The Annual Reports of the companies covered in the "Participations" section are
available on demand from the Company's headquarters.
76 PA R G E S A H O L D I N G S . A . - A N N U A L R E P O R T 1 9 8 9
Holding SA

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Holding SA

INDUSTRY AND SERVICES 41

Compagnie Frangaise de TA f r i q u e Occidentale (CFAO) 50

Consolidated balance sheet 56

PA R G E S A HOLDING S.A. • ANNUAL REPORT 1989 3

This diagram shows the percentages of control by the Group's companies. PA R C

25,4 31,1 '

LAMBERT BRUSSELS GROUPE BRUXELLES

23,3 24,0 24,0 21,7

BANQUE HENRY BAN*

BRUXELLES ANSBACHER INTERNA'

22,8 20,5 25,4 56,6 16,8 3,7

7,9 61,2 51,0

19,5 42,1 14,8 10,0 21,5 15,0

GERARD ESKENAZI Chairman,

ALBERT FRERE Deputy-Chairman,

PIERRE SCOHIER Vice-Chairman and Managing Director

ANDRE de PFYFFER j Vice-Chairman,

MICHEL ALBERT Paris,

GILLES COLOMB Geneva,

MICHEL FRANQOIS-PONCET Paris,

LUZIUS GLOOR Basel,

PIERRE LANGUETIN Bern

ROBERT PIAGET Lausanne,

ERNST & YOUNG S.A. Geneva

6 PA R G E S A HOLDING S.A. • ANNUAL REPORT 1989

MANUEL BOULLOSA Rio de Janeiro,

PHILIPPE LAMBERT Geneva,

JEAN-PIERRE LAURENT-JOSI Brussels,

ANDRE LEYSEN Antwerp,

FAHAD M. AL-RAJAAN Kuwait,

GASTON THORN Luxemburg,

PA R G E S A HOLDING S.A, • ANNUAL REPORT 1989 7

GERARD ESKENAZI Chairman of the Board

ALBERT FRERE Deputy-Chairman

PIERRE SCOHIER Vice-Chairman and Managing Director

ANDRE de PFYFFER Vice-Chairman of the Board

JEAN LANIER Managing Director

PAUL DESMARAIS Jr. Montreal,

ULF LINDEN Goteborg,

GILLES SAMYN Charleroi,

GERARD ESKENAZI Chairman and Chairman of the Executive Committee

ALBERT FRERE Deputy-Chairman

PIERRE SCOHIER Vice-Chairman and Managing Director

JEAN LANIER Managing Director

CLAUDE VERCAMBRE Executive Vice-President

Administrative and financial management

PAT R I C K de HENEY Vice-President

OLIVIER de JAMBLINNE Assistant Vice-President, Pargesa Luxembourg S.A,

FABIENNE RUDAZ Treasurer

C H I R I TA DUMITRU Head of Accounts Department

PIERRE HAAS Adviser

RICHARD FENHALLS Executive Chairman, Henry Ansbacher & Co. Limited

HANS PETERHANS Controller

1989 1988 1987 1986

Consolidated shareholders' equity (SF m i l l i o n ) 1,940.6 1,638.2 1,431.0 1,440.6

Dividend per share^ (SF) 65.0 64.7 61.7 57.9

1. before exceptional items — 2, adjusted

ing S.A., is based in Geneva; Group investments in the banking

— Parfinance in France is responsible In the industrial and commercial sector.

for initiating and supervising Group Group activities are concentrated on a

The Group manages a portfoho of parti

PA R G E S A HOLDING S.A. - ACTIVITIES OF THE C O M PA N Y 1989 13