Annual reports for non-financial limited companies, account statistics, 1999

The improvement in operating profit is primarily due to a reduced growth in operating costs.

Operating income

The operating income of joint-stock companies amounted to NOK 1 935 billion in 1999, a growth of 5 per cent from 1998. Joint-stock companies have enjoyed significantly reduced growth in operating income the past two years compared to the period 1994 to 1997, where the annual growth was all of 13 per cent.

Operating expenditure

In 1999, operating expenditures for joint-stock companies amounted to approx. NOK 1 800 billion, or about 4 per cent more than the year before. Operating expenditures have had an annual growth of between 10 and 13 per cent in the period 1994 to 1998.

Operating margin

The ratio between operating profit and operating income is reflected in the operating margin. As a result of reduced operating expenditures in 1999, the operating margin went up almost one percentage point, from 6.1 per cent in 1998 to 7.0 per cent. By comparison, the operating margin in 1997 was 8.3 per cent.

Improved capital strength

Capital strength measured by the equity ratio shows a marginal improvement from 37.7 per cent in 1998 to 37.9 per cent in 1999. Improved capital strength has been a trend in recent years. The growth in equity ratio was strongest from 1993 to 1997, when the average increase was more than 2.5 percentage points per year. The growth in the equity ratio flattened out after 1997, showing an increase of 0.2 percentage points from 1998 to 1999.

Break in statistics

Due to changes in the chart of accounts in connection with the transition to the Accounting Act of 1998, there is a break in the statistics as of fiscal year 1999. A new standard has been established for posting extraordinary items, resulting in a somewhat altered distinction between ordinary and extraordinary items. Furthermore, starting in 1999, taxes are divided into tax on ordinary and extraordinary profit/loss. The chart of accounts for the balance sheet has been significantly changed in that the least liquid assets under assets are presented first. Equity is presented before liabilities and long-term liabilities come before current liabilities.

The changes in the chart of accounts have made it necessary to alter the definitions of several key figures. In the statistics of accounts for 1999, return on total assets is defined as the sum of ordinary profit/loss before taxes and interest costs, in per cent of the total capital as of 31 December. In previous statistics of accounts, it was not possible to separate interest costs, and total financial expenditures were used as a replacement for interest costs. Corresponding changes have been made for several key figures. The definition of operating margin, equity ratio and current ratio have been maintained and these key figures are to some degree comparable over time.