Key performance indicators of the Group and its businesses

The three key performance indicators of net sales, EBITDA pre, and operating cash flow (OCF) are the most important financial indicators for assessing our operational performance. Accordingly, we refer to these KPIs in the Report on Economic Position, the Report on Risks and Opportunities, and the Report on Expected Developments. As the most important indicators of financial business performance, the KPIs are key elements of our performance management system.

Net sales

Net sales are defined as the revenues from the sale of goods, services rendered to external customers, and commission income and profit sharing from collaborations, net of value-added tax, and after sales deductions such as rebates or discounts. Net sales are the main indicator of our business growth and are therefore an important parameter of external as well as internal performance measurement. In addition, organic sales growth compared with the annual target is used for internal performance management. Organic sales growth shows the percentage change in net sales versus a comparative period, adjusted for exchange rate and portfolio effects. Exchange rate effects may arise as a result of foreign exchange fluctuations between the functional non-euro currency of a consolidated company and the reporting currency (euro). By contrast, portfolio effects reflect sales changes due to acquisitions and divestments of consolidated companies or businesses.

Group

Net sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change

€ million

 

2024

 

2023

 

€ million

 

%

Net sales

 

21,156

 

20,993

 

163

 

0.8%

EBITDA pre

EBITDA pre is the main performance indicator measuring ongoing operational profitability and is used internally and externally. To permit a better understanding of the underlying operational performance, the operating result is adjusted to exclude depreciation and amortization, impairment losses and reversals of impairment losses, as well as adjustments. These adjustments are restricted to the following categories: integration expenses, IT expenses for certain projects, restructuring expenses, gains/losses on the divestment of businesses, acquisition expenses, and other adjustments. The classification of specific income and expenses as adjustments follows clear rules and is subject to strict governance at the Group level. Within the scope of internal performance management, EBITDA pre allows for efficiency improvements to be implemented in processes without the performance of the operating business being affected by exceptional items or restructuring expenses. The following table shows the composition of EBITDA pre in fiscal 2024 compared with the previous year. The International Financial Reporting Standards (IFRS) figures have been modified to reflect the elimination of adjustments included in the respective functional costs.

Group

Reconciliation EBITDA pre1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2024

 

2023

 

Change

€ million

 

IFRS

 

Elimination of adjustments

 

pre1

 

IFRS

 

Elimination of adjustments

 

pre1

 

pre1

Net sales

 

21,156

 

 

21,156

 

20,993

 

 

20,993

 

0.8%

Cost of sales

 

-8,671

 

41

 

-8,630

 

-8,600

 

43

 

-8,558

 

0.8%

Gross profit

 

12,485

 

41

 

12,526

 

12,392

 

43

 

12,435

 

0.7%

Marketing and selling expenses

 

-4,536

 

30

 

-4,506

 

-4,510

 

44

 

-4,466

 

0.9%

Administration expenses

 

-1,370

 

154

 

-1,216

 

-1,392

 

246

 

-1,146

 

6.1%

Research and development costs

 

-2,279

 

11

 

-2,269

 

-2,445

 

7

 

-2,438

 

-7.0%

Impairment losses and reversal of impairment losses on financial assets (net)

 

-8

 

2

 

-7

 

-51

 

 

-51

 

-87.1%

Other operating income and expenses

 

-646

 

333

 

-313

 

-385

 

138

 

-247

 

26.8%

Operating result (EBIT)1

 

3,645

 

 

 

 

 

3,609

 

 

 

 

 

 

Depreciation/amortization/impairment losses/reversals of impairment losses

 

2,134

 

-277

 

1,856

 

1,880

 

-87

 

1,792

 

3.6%

EBITDA2

 

5,779

 

 

 

 

 

5,489

 

 

 

 

 

 

Restructuring expenses

 

144

 

-144

 

 

249

 

-249

 

 

 

Integration expenses/IT expenses

 

103

 

-103

 

 

118

 

-118

 

 

 

Gains (-)/losses (+) on the divestment of businesses

 

-46

 

46

 

 

-51

 

51

 

 

 

Acquisition-related adjustments

 

26

 

-26

 

 

18

 

-18

 

 

 

Other adjustments

 

68

 

-68

 

 

56

 

-56

 

 

 

EBITDA pre1

 

6,072

 

 

6,072

 

5,879

 

 

5,879

 

3.3%

thereof: organic growth1

 

 

 

 

 

 

 

 

 

 

 

 

 

6.9%

thereof: exchange rate effects

 

 

 

 

 

 

 

 

 

 

 

 

 

-3.6%

thereof: acquisitions/divestments

 

 

 

 

 

 

 

 

 

 

 

 

 

-0.1%

1

Not defined by International Financial Reporting Standard (IFRS).

2

Not defined by International Financial Reporting Standards (IFRS); EBITDA corresponds to operating result (EBIT) adjusted by depreciation, amortization, impairment losses, and reversals of impairment losses.

Operating cash flow (OCF)

Operating cash flow results from our current business activities and describes the cash generated from operating activities. It is influenced mainly by EBITDA pre, income tax, the financial result, and changes in net working capital.

Group

Operating cash flow

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change

€ million

 

2024

 

2023

 

€ million

 

%

EBITDA pre1

 

6,072

 

5,879

 

193

 

3.3%

Adjustments1

 

-293

 

-390

 

97

 

-24.9%

Finance result2

 

-108

 

-125

 

17

 

-13.4%

Income tax2

 

-751

 

-650

 

-101

 

15.5%

Changes in working capital1

 

-63

 

-141

 

78

 

-55.4%

thereof: Changes in inventories3

 

36

 

-89

 

124

 

>100.0%

thereof: Changes in trade accounts receivable3

 

79

 

-8

 

88

 

>100.0%

thereof: Changes in trade accounts payable/refund liabilities3

 

-178

 

-43

 

-134

 

>100.0%

Changes in provisions3

 

62

 

188

 

-126

 

-67.0%

Changes in other assets and liabilities3

 

-309

 

-755

 

446

 

-59.1%

Neutralization of gains/losses on disposal of fixed assets and other disposals3

 

-2

 

-150

 

148

 

-98.6%

Other non-cash income and expenses3

 

-22

 

-72

 

50

 

-69.6%

Operating cash flow

 

4,586

 

3,784

 

802

 

21.2%

1

Not defined by International Financial Reporting Standard (IFRS). Adjustments according to definition above.

2

According to Consolidated Income Statement.

3

According to the Consolidated Cash Flow Statement.

Share this page: