The classification of asset and income figures as well as of other key figures by business sector or by region in accordance with IFRS 8 is presented in “Segment Reporting”. The segments presented correspond to the internal organizational and reporting structure of the Merck Group. Within the Merck Serono division, we focus on specialist therapeutic areas and markets innovative prescription drugs of chemical and biotechnological origin. The Consumer Health Care division comprises Merck’s business with high-quality over-the-counter products for preventive health care and self-treatment of minor ailments. These two divisions form the Pharmaceuticals business sector. The Liquid Crystals division operates the business with materials for displays. The Performance & Life Science Chemicals division operates in three businesses: Laboratory Business consists of the range of laboratory chemicals including all the related analytical certificates. Life Science Solutions offers products and solutions using the latest technological expertise in chemical and biotechnological processes. Pigments develops and manufactures innovative effect pigments. The Liquid Crystals division and the Performance & Life Science Chemicals division form the Chemicals business sector.
The segment Corporate and Other mainly includes the income and expenses that cannot be allocated to the operating segments, e.g. expenses for central administrative functions.
The financial result and taxes on income are also allocated in full to the Corporate and Other segment. The operating segments are described in detail in the sections about the divisions.
Apart from total revenues, the success of a segment is mainly determined by the division’s operating result as well as free cash flow and the key figures derived from these such as “Underlying free cash flow on revenues (FCR)“ and “Return on Sales (ROS)”.
Transfer prices for intragroup sales are determined on an arm’s-length basis. There were no significant intercompany relations between the business segments.
The reconciliation of operating assets included in “Segment Reporting” is as follows:
| XLS |
|
€ million |
Dec. 31, 2009 |
Dec. 31, 2008 |
|
Assets |
16,712.6 |
15,644.7 |
|
Monetary assets (cash and cash equivalents, loans, securities) |
–2,119.7 |
–895.7 |
|
Financial assets covering pensions |
–209.6 |
– |
|
Non-operating receivables, tax receivables, deferred taxes and deferred pension payments |
–635.6 |
–664.2 |
|
Operating assets (gross) |
13,747.7 |
14,084.8 |
|
Trade accounts payable |
–935.7 |
–843.7 |
|
Other operating liabilities |
–465.3 |
–472.9 |
|
Operating assets (net) |
12,346.7 |
12,768.2 |
The Performance & Life Science Chemicals division accounted for € 0.1 million (2008: € 0.2 million) and the Corporate and Other segment for € 3.4 million (2008: € –0.8 million) of the investment result disclosed in the income statement. In 2009, no portion of the investment was attributable to the Merck Serono division (2008: € 0.7 million).
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