Value added 

Value added is a measure of the economic strength of a company and indicates how the corporate result is achieved and for what it is used.

The corporate result, i.e. the sum of total revenues, other income and financial income, amounted to € 7,713 million in 2008. After deducting the costs of materials as well as other purchased services and expenses, the net value added statement shows that gross value added increased to € 3,975 million in 2008. Following the deduction of write-downs, which were very high in 2007 due to the purchase price allocation for the Serono inventories, net value added amounted to € 2,760 million.

The majority, or 73%, of net value added went towards personnel expenses, i.e. salaries, social security contributions and pension expenses. Financial expenses were significantly lower following an increase in 2007 due to the Serono acquisition. Profit after tax and income tax were higher than in 2007, a year that was strongly impacted by the Serono acquisition.