E_mg_GB_03_vorne-29_3_04

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126 The above tables give the fair values and the expected long-term returns on these plan assets for German pension plans. The returns are estimated based on both historical and future expected market and portfolio performance. a582,000 is expected to be allocated to German pension plan assets in 2004. The plan assets continue to be managed by benevolent funds and foundations and are mainly invested in fixed-income securities and fixed-term deposits. There are no plans at present to change this investment strategy. The accumulated benefit obligation (excluding future salary increases) for German pension plans amounted to a790.572 million in 2003 (prior year: a736.913 million). The balance sheet date used to report German pension plan assets is December 31, 2003. ab) Defined Contribution Plans The individual companies of the mg Group’s continued operations offer various postretirement benefits in the form of defined contribution plans. The pension cost of these plans lies not with mg but with the respective pension provider. Total contributions of a12.645 million (prior year: a639,000) were paid in 2003. ac) Other Postretirement Benefits In addition to pensions and similar obligations, the mg Group provides certain retired employees with postretirement benefits for health insurance premiums. The following information refers to the Group’s postretirement benefit plans in Germany. Change in projected benefit obligation 12/31/2003 12/31/2002 u ’000 t ’000 Projected benefit obligation at beginning of year 48,778 48,780 Service cost 354 82 Interest cost 2,722 713 Actuarial losses (+)/gains (–) 4,716 – 3 Benefits paid – 3,410 – 794 Accumulated postretirement benefit obligations at end of year Reconciliation of funded status 53,160 48,778 Funded status 53,160 48,778 Unrecognized actuarial losses (–)/gains (+) – 397 4,212 Net amount recognized 52,763 52,990
MANAGEMENT SHARE STRATEGY SPECIAL SECTION MANAGEMENT REPORT FINANCIAL STATEMENTS FURTHER INFORMATION Consolidated Balance Sheets • Statements of Income • Statements of Cash Flows • Statements of Changes in shareholders’ Equity • Fixed Assets Schedule • Notes • Independent Auditors’ Report Actuarial assumptions used to determine costs and benefit obligations for principal additional domestic pension plans were as follows: 12/31/2003 12/31/2002 Weighted-Average Assumptions % % Discount rate 5.5 6.0 Healthcare and life insurance inflation rate 4.0 4.0 The inflation rate for German pension plans with respect to healthcare and life insurance costs is estimated to be 4.0% for 2004. The balance sheet date used to report German pension plans is December 31, 2003. Components of net periodic postretirement benefit cost for the plan are as follows: 1/1/2003 - 10/1/2002 - 12/31/2003 12/31/2002 u ’000 t ’000 Service cost 354 82 Interest cost 2,722 713 Amortization of actuarial losses (+) / gains (–) 2 -7 Net periodic pension cost 3,078 788 Additional postretirement benefits are also paid by two foreign companies. Their funded status at December 31, 2003 comes to a3.710 million (prior year: a4.361 million) and the net amount recognized for additional foreign postretirement benefits totals a4.242 million (prior year: a5.093 million). The relevant cost of these benefits in 2003 amounted to a353,000 (prior year: a103,000). Actuarial assumptions used to determine costs and benefit obligations for additional foreign postretirement benefits include a discount rate of 6.25% (prior year: 7.0% and 6.75%). These assumptions also took into account projections of the rising cost of medical and dental treatment benefits. The rise in the cost of medical healthcare benefits amounts to 15.0% and 9.0% (prior year: 8.5% and 9.5%). These costs will fall by 1.0% and 0.5% per year respectively (prior year: 0.5%) up to 2013 and 2011 (prior year: 2009 and 2011). The rise in the cost of dental healthcare benefits amounts to 7.5% and 9.0% (prior year: 7.5% and 9.5%). They will fall by 0.5% per year (prior year: identical) up to 2010 and 2011. There was no change on the prior year. The following schedule presents the effect of a one percentage point change in the inflation rate on the service cost and accumulated postretirement benefit obligations for pension plans at December 31, 2003: 1% Increase 1% Decrease German Foreign German Foreign P ’000 P ’000 P ’000 P ’000 Effect on service cost Effect on accumulated postretirement + 54 + 43 – 43 – 37 benefit obligations + 5,724 + 357 – 4,917 – 328 127
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“2003 was a year of transition fo
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Consolidated Key Figures 2003 RESUL
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Creating freedom for action CONTENT
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MANAGEMENT SHARE STRATEGY SPECIAL S
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zation As the world’s population
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The pharmaceutical industry will co
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Milk Last year, over 160 million co
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The MODUL tablet press produced by
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For a technology-driven organizatio
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Page 81 and 82: mg's mission is to ensure sustainab
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Key Figures for the mg Group RESULT
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