Engineering

2.1 Management report on the Group Profile and and strategy
Details of the switch are explained on on
pages pages 96-97 of the Annual Report
2009/2010.
Further development of value-based management
In fiscal year 2010/2011 ThyssenKrupp switched its operational management from EBT to EBIT. EBIT is a
key parameter affecting TKVA, so we now manage the Group based more closely on the performance factors
that can be influenced by operational management. In addition, operational management and value
management are now optimally interlinked.
In connection with the introduction of EBIT-based management we modified the definitions of EBIT and
capital employed, altering the classification of financial income/expense into operational and nonoperational
components. EBIT contains only components of financial income/expense that are operational in
nature. Interest income, interest expense and the great majority of other financial income/expense are nonoperational
in character. These modifications also apply at business area level and take into account the fact
that the receipt of advance payments, particularly in the business areas with long-term construction
contracts, is an integral part of risk management – to avoid default risks on the customer side – and thus of
operating business. To recognize these advance payments, and the interest and financing effects attainable
with them, in our value management, the EBIT of the relevant business areas is increased by an imputed
earnings contribution.
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