Profit before and after tax*
Profit after tax from continuing operations below the previous year
Profit after tax from continuing operations was €–88 million and was thus considerably lower than in 2006. The reasons for this sharp decline are the additional amortization of intangible assets and extraordinary items for write-downs of Serono’s inventories which were booked in 2007, as well as the gain on the disposal of the interest in Schering, which was included under extraordinary items in 2006. Adjusted for exceptional items, the tax rate was 28.2%, compared with 25.8% in 2006.
Discontinued operations (Generics)
On October 2, 2007, Merck completed the sale of its Generics business to Mylan Inc. for €4.9 billion. The proceeds from this divestment were booked in the fourth quarter. The after-tax gain on the disposal amounting to €3,471 million is disclosed together with the earnings contribution of the Generics division of €137 million on a separate line in the income statement, namely “Profit from discontinued operations”.
Profit after tax from continuing operations and discontinued operations
Profit after tax from continuing and discontinued operations was €3,520 million in 2007 compared with €1,001 million in 2006.
