Technologies · Systems · Solutions - Dürr

Amounts in €k
Impairment test for goodwill
Land and buildings
Consolidated financial statements of Dürr AG
103
Paint
Final
Assembly Measuring
Systems Systems Ecoclean Services Systems Dürr Group
Carrying amount
as of January 1, 2003 132,590 87,203 18,833 57,781 59,131 355,538
Currency differences –2,239 –2,271 –2,172 –9,047 1,934 –13,795
Purchase price adjustment – – –119 – – –119
Additions in 2003
Carrying amount
318 1,857 – – 2,272 4,447
as of December 31, 2003 130,669 86,789 16,542 48,734 63,337 346,071
Currency differences –690 –1,135 –1,077 –3,779 224 –6,457
Additions in 2004
Carrying amount
– 1,146 – – 12,996 14,142
as of December 31, 2004 129,979 86,800 15,465 44,955 76,557 353,756
The goodwill acquired from business combinations is allocated to the cash-generating units, at
Dürr the business units, for impairment testing. The calculation model is used in exactly the
same way for all cash-generating units as the main parameters apply equally to all business units.
The net realizable amount of the cash-generating units is determined on the basis of value in use.
This calculation is prepared on the basis of cash flow forecasts which are based on the financial
planning approved by the management for a period of three years. The discount rate used for the
2004 cash-flow forecasts of the various business divisions ranges between 11.26% and 11.62%
(2003: range of 10.99% fo 11.22%). Cash flows after the three-year period are extrapolated using a
growth rate of 1.5% (2003: 1.5%) based on the long-term growth rate of the business units.
Planned gross profit margins
The gross profit margins are determined in the subsidiaries’ bottom-up planning. These are
based on the figures determined for the previous reporting period, taking anticipated efficiency
increases into account.
Capital costs (discount rate)
The capital costs are the weighted mean of debt capital and equity costs before tax. Debt capital
costs are based both on the credit rating and also the rating for the bond issued in 2004. When
calculating the capital costs, a beta factor is also assumed which is derived from the capital market
data of comparable companies and the capital structure of Dürr.
Increase in the price of raw materials
Price increases in raw materials are determined from the forecasted price indices of the countries
from which the raw materials are procured by the respective subsidiaries.
Increase in salary costs
In the three-year plan, the German subsidiaries have assumed annual salary increases of 2%.
The foreign subsidiaries have used the applicable local rate of increase for the respective planning
period.
In the 2004 reporting period, four (2003: four) buildings were recognized as finance leases; Dürr
does not have legal title to these buildings. The depreciation expense recorded on these buildings
is included in property, plant and equipment.