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3.6 Consolidated financial statements Notes to the consolidated financial statements
Impairment losses of property, plant and equipment are for the most
part included in cost of sales and to a minor extent in selling and
administrative expenses.
In 2009/2010 given the demand situation in the Components
Technology business area, in the Forging group and Bilstein group
operating units impairment losses of €32 million were recorded. €2
million of the total impairment relates to land and buildings, €29
million to technical machinery and equipment and €1 million to other
equipment. The recoverable amounts used to calculate the impairment
losses correspond in each case to the values in use. A discount rate of
11.6% and 13.1%, respectively was used to calculate the values in
use.
In 2010/2011 impairment losses of €1,685 million were recorded in
the Steel Americas business area. €237 million of the total impairment
relates to buildings, €1,321 million to technical machinery and
equipment and €100 million to construction in progress. Reasons for
the impairment losses are increased acquisition costs caused by cost
overruns on the construction of the Brazilian plant, significant
prolonged losses due to the delayed ramp-up, the strength of the
million €
Consolidated financial statements
156 | 157
Brazilian real affecting the competitive position of the Brazilian plant
both now and in the near future as well as the slower recovery and
renewed weakness of markets in the USA and Europe; also the
increase of the weighted average cost of capital was a strain. The
recoverable amounts used to calculate the impairment losses
correspond in each case to the values in use. A discount rate of 10.5%
was used to calculate the values in use.
In the Steel Americas business area the carrying amounts of property,
plant and equipment in the amount of €6,259 million are also in the
following fiscal year exposed to valuation risks; these are in particular
the parameters of the capital markets as well as the expectation of the
long-term development of the exchange rate and the assessment of
the ability to achieve the operational aims in terms of cost efficiency
and market entrance.
Property, plant and equipment include leased buildings, technical
machinery and equipment and other equipment that have been
capitalized, where the terms of the lease require the Group, as lessee,
to assume substantially all of the benefits and risks of use of the
leased asset (finance lease).
Gross amounts
Sept. 30,
2010
Sept. 30,
2011
Accumulated depreciation and
impairment losses Net amounts
Land, leasehold rights and buildings including buildings on third-party land 99 73 46 34 53 39
Technical machinery and equipment 89 52 66 37 23 15
Other equipment, factory and office equipment 47 35 32 23 15 12
Assets under finance lease 235 160 144 94 91 66
Sept. 30,
2010
Property, plant and equipment have been pledged as security for financial payables of €5 million (2010: €100 million).
Sept. 30,
2011
Sept. 30,
2010
Sept. 30,
2011