E_mg_GB_03_vorne-29_3_04

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
reported, this expense is shown in mg’s ‘Other’ column rather than in the Lurgi Lentjes and Zimmer
segments. Since Lurgi Lentjes and Zimmer were responsible for the technical implementation of these
projects, the profits generated by the projects were shown according to the percentage-of-completion
method in the respective segments until mg’s Executive Board assumed responsibility for them.
A similar relationship exists between Lurgi Lentjes and the Boiler Plant business unit. In the past,
Lurgi Lentjes has assumed responsibility for two contracts processed by this unit. This assumption
of responsibility incurred an expense of a12.2 million for the Lurgi Lentjes segment in 2003.
As in previous years, during the period under review the Lurgi Lentjes segment contains income
from a service agreement with mg capital gmbh (‘Other’ segment). Under this agreement, Lurgi
Lentjes helps mg capital gmbh to perform its management responsibilities and administrative duties
with respect to the Boiler Plant and Stahlbau Plauen business units it took over effective October 1,
2000. This restructuring of the investment portfolio aligned the legal structure with the management
and reporting structures already implemented. As a result of this service agreement, a5.5 million
(prior year: a1.7 million) was reimbursed to Lurgi Lentjes in 2003.
As in previous years, mg Altersversorgung GmbH has agreed to pay postretirement benefits to retirees
in the Lurgi and Lurgi Lentjes segments. As a result of this agreement, mg Altersversorgung GmbH
(‘Other’ segment) has incurred an additional expense of a2.5 million for 2003. Correspondingly,
the Lurgi and Lurgi Lentjes segments contain income of a1.4 million and a1.1 million respectively
as a result of this agreement. As this constitutes an intercompany transaction, the pertinent income
and expenses are eliminated in the ‘Consolidated’ column.
The number of employees at the balance sheet date is stated on the basis of full-time equivalents,
excluding trainees and directors of mg technologies ag.
For further information on the two types of business reported as ‘discontinued operations’, please
refer to Note G) ‘Discontinued operations’.
Goodwill per segment was as follows in 2003:
Continued operations Discontinued operations
Lurgi Dynamit Consoli- Consolit
million GEA Lurgi Lentjes Zimmer Nobel Other dated Total solvadis Other dated Total
Book value at
12/31/2002 221.1 9.9 3.6 341.2 – 918.7 1,494.5 55.5 1.4 11.3 68.2
Allocation of
consolidation to
segments 853.9 – – 51.0 13.8 – – 918.7 – – 11.3 – 11.3 –
Book value at
1/1/2003 1,075.0 9.9 3.6 51.0 355.0 – – 1,494.5 55.5 12.7 – 68.2
Increase in goodwill
Goodwill
2.1 – – 2.7 11.4 – 16.2 – – –
impairment – – – – – – – – – –
Decrease in goodwill – 0.4 – – – – – 0.4 – – 11.3 – 11.3
Price differences – 5.8 – 1.3 – – – 20.8 – – 27.9 – – –
Book value at
12/31/2003 1,070.9 8.6 3.6 53.7 345.6 – 1,482.4 55.5 1.4 56.9
149