THE NATURE OF OUR BUSINESS â€“ STABLE GROWTH - Symrise

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Acquisitions of businesses amounting to € 122.4 million result from the acquisition of the flavor business from Chr. Hansen and of the fragrance businesses from Intercontinental Fragrances and Manheimer Fragrances. The amortization of recipes is allocated to production and is therefore included in the cost of sales. The amortization of other intangible assets is allocated to the respective functional areas included in the income statement. 8.11. Impairment Testing of Goodwill, Recipes and Trademarks with Indefinite Useful Lives Goodwill arising through business combinations has been allocated to the following two cash-generating units, which are tested for impairment: › Flavor & Nutrition › Scent & Care The recoverable amount of a business division is determined based on the value in use as at September 30, 2008. Cash flow projections are based on the Group’s three year financial planning. A net tax discounting factor of 8.0% (prior year: 7.6%) was used to discount cash flow projections. The carrying amount of goodwill as at September 30, 2008 amounted to € 309.3 million in the Flavor & Nutrition division and € 156.1 million in the Scent & Care division. As compared to the balance sheet reporting date as at December 31, 2008, the estimated goodwill recognized for the Manheimer acquisition was then some € 10.6 million ($ 15.0 million) higher. Within the context of a purchase price reduction made in December 2008, a correspondingly lower goodwill was derived at the balance sheet reporting date. As in the previous year, the total amount (€ 62.1 million) relating to recipes with indefinite useful lives has been allocated to the Scent & Care division. In this case, an impairment test was also carried out as of September 30, 2008, at the level of the cash-generating unit with the result that no impairment requirement was identified. Trademarks with indefinite useful lives were also tested for impairment as at September 30, 2008. No impairment was identified. An impairment loss of € 35.7 million was recognized in 2003 with respect to goodwill attributed to the Scent & Care division. The impairment related to the former Aroma Chemicals business sector. Key assumptions used in determining the recoverable amount The Group determined the value in use as the recoverable amount. The key assumptions are described below which provided the basis for management’s cash flow projections used in making the impairment tests for goodwill, recipes and trademarks. The value in use was calculated using the discounted cash flow (DCF) method under which free cash flows are discounted using the weighted average cost of capital (WACC). The Group has calculated the cash flows of the individual divisions during the period from 2008 to 2011 based on varying growth rates. For 2009, the data used was based on the detailed budget data for 2009, whereas for the years 2010 and 2011 a constant growth rate of 4.5% was used for the Flavor & Nutrition division and a constant growth rate of 3.5% was used for the Scent & Care division. An overall growth rate of 0.5% was assumed for the year 2012. The WACC comprises a risk-free interest rate of 4.8%, which is derived from the interest rate on German federal government bonds, and a market risk premium of 5.0%. The unlevered beta factor is 0.75 and the levered beta factor is 0.9. The estimated cost of equity is 9.3% and the cost of debt is 6.3%. The ICF and Manheimer acquisitions (see note 8.13) were included in the impairment test as at September 30, 2008. Applying the assumptions described above, the impairment test carried out as at September 30, 2008, confirmed that there was no impairment of either goodwill or recipes. The recoverable amount was higher than the respective carrying amounts in both business divisions. 126 Annual Report 2008 <strong>Symrise</strong> AG
8.12. Property, Plant and Equipment 2007 T€ Cost As at January 1, 2007 Acquisition Additions Currency translation differences Disposals Transfers Transfers/IFRS 5 As at December 31, 2007 Accumulated Depreciation/Impairment As at January 1, 2007 Charges for the financial year Impairment losses Currency translation differences Reversal of impairments Disposals Transfers Transfers/IFRS 5 As at December 31, 2007 Carrying amounts As at January 1, 2007 As at December 31, 2007 1) See note 8.13 2) Germany. See note 8.6 The column “Advance Payments” includes assets under construction with an original acquisition and construction cost of € 27.5 million. Additions deriving from business combinations amounting to € 1.5 million include the acquisitions of WWS Ltd. / Steng Ingredients Ltd., Suffolk, Great Britain on February 28, 2007, and Aromatics SAS, France on July 31, 2007. Annual Report 2008 <strong>Symrise</strong> AG 127 Land and buildings 284,565 706 1,213 –4,763 –2,485 2,765 –283 281,718 -52,987 -9,941 -48 1,143 175 798 129 119 -60,612 231,578 221,106 Plant and machinery 207,125 681 5,061 -5,038 -1,776 9,119 0 215,172 -106,818 -15,346 0 2,426 39 1,405 988 0 -117,306 100,307 97,866 Equipment 94,700 116 5,492 -1,339 -2,249 3,661 0 100,381 -56,060 -11,516 0 686 94 1,987 -1,117 0 -65,926 38,640 34,455 Advance payments 27,149 0 18,013 -629 -977 -15,545 0 28,011 -823 -44 0 36 0 831 0 0 0 26,326 28,011 Total 613,539 1,503 29,779 -11,769 -7,487 0 -283 625,282 -216,688 -36,847 -48 4,291 308 5,021 0 119 -243,844 396,851 381,438 Notes
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THE NATURE OF OUR BUSINESS - STABLE
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Key Figures € million Sales Scent
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4 - 51 52 - 92 93-98 99-147 148-152
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April 25 Symrise organizes the “t
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2008: A financial crisis became an
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We can hope that 2009 will bring th
Page 13 and 14:
Dominique Yates CFO since October 2
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Growth Means Stability - in Nature
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OUR THREE BRAND PILLARS The flavors
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Flavors and Fragrances Are More Tha
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Our requirement is to meet new requ
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Innovation Is Never Just About Prod
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MORE INNOVATION THROUGH MORE INTEGR
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Responsibility Knows No Boundaries
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emissions. We require of ourselves
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Dr. Gerold Linzbach, speaking with
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divisions. At the same time, the na
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are increasingly strict and expensi
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ically examine the costs from the v
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Our People Success has many faces.
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A complete Junior Perfumer program
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cludes the Symrise share, declined
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Attractive Dividend Proposed for 20
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The Executive Board and Supervisory
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A breakdown of the total remunerati
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Report of the Supervisory Board In
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Annual and Consolidated 2008 Financ
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Detail Index Group Management Repor
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As a rule, our flavor, fragrance an
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The organizational structure is cus
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Flavor & Nutrition Beverages Sweet
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Flavor & Nutrition: Innovations and
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MARKET SHARE F&F INDUSTRY (total
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Financial Objectives and Value-base
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half of 2009. After integration cos
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SALES BY REGION € million EAME As
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RECONCILIATION € million EBIT EBI
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“AND” Products Grow Faster Sale
Page 77 and 78: ucts was significantly lower than o
Page 79 and 80: 6. FINANCIAL POSITION Main Financia
Page 81 and 82: 8. OTHER FACTORS RELEVANT TO RESULT
Page 83 and 84: High Performance Sales Training, co
Page 85 and 86: active health promotion programs an
Page 87 and 88: Customer complaints about product q
Page 89 and 90: The following table shows when our
Page 91 and 92: › our position on the core lists
Page 93 and 94: Dr. Gerold Linzbach therefore reque
Page 95 and 96: Consolidated Income Statement T€
Page 97 and 98: EQUITY AND LIABILITIES T€ LIABILI
Page 99 and 100: T€ Balance brought forward Invest
Page 101 and 102: Notes to the Consolidated Financial
Page 103 and 104: company is lost. The changed provis
Page 105 and 106: Further information on share intere
Page 107 and 108: If the requirements of IAS 39 with
Page 109 and 110: The sales tax amount that is recove
Page 111 and 112: opment costs recognized are amortiz
Page 113 and 114: tion results in a gain, any recogni
Page 115 and 116: 5. SEGMENT REPORTING For the purpos
Page 117 and 118: 2008 T€ Sales External sales Resu
Page 119 and 120: 6. CONSOLIDATED INCOME STATEMENT 6.
Page 121 and 122: 6.8.Financial Result T€ Interest
Page 123 and 124: The interest risk that is hedged is
Page 125 and 126: The deferred tax assets and liabili
Page 127: 2008 T€ Cost As at January 1, 200
Page 131 and 132: 8.13. Acquisitions Cambridge Theran
Page 133 and 134: Current bank borrowings are not sec
Page 135 and 136: A new pension plan was established
Page 137 and 138: The entity in the US provides healt
Page 139 and 140: Repayment of Bank Borrowings The Se
Page 141 and 142: The following table shows amounts r
Page 143 and 144: Sensitivity Analysis for Derivative
Page 145 and 146: 11. LONG TERM FINANCIAL RISK MANAGE
Page 147 and 148: continuance Company M&G Investment
Page 149 and 150: Annual Report 2008 Symrise AG 147
Page 151 and 152: Responsibility Statement (“Bilanz
Page 153 and 154: Dr. Peter Grafoner* Horst-Otto Gerb
Page 156: Symrise AG Mühlenfeldstraße 1 376
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THE NATURE OF OUR BUSINESS â€“ STABLE GROWTH - Symrise

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