Corporate and Other comprises Group administration expenses for Group functions that cannot be directly allocated to the divisions, such as Finance, Procurement, Legal, Communications, and Human Resources. Corporate costs additionally encompass expenses for central, non-allocated IT functions, including expenses related to the expansion and harmonization of IT systems within the Merck Group. Accordingly, Corporate and Other has no sales to report. Gains or losses on currency hedging are also disclosed in Corporate and Other.
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Corporate and Other | Key figures |
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€ million |
Q3 – 2014 |
Q3 – 2013 |
Change |
Jan.–Sept. 2014 |
Jan.–Sept. 2013 |
Change |
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Operating result (EBIT) |
–73.8 |
–57.0 |
29.5 |
–165.1 |
–187.3 |
–11.8 |
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EBITDA |
–66.5 |
–53.3 |
24.7 |
–150.9 |
–176.5 |
–14.5 |
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EBITDA pre one-time items |
–44.1 |
–48.9 |
–9.9 |
–112.2 |
–142.9 |
–21.5 |
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Business free cash flow |
–51.9 |
–55.0 |
–5.6 |
–130.1 |
–214.4 |
–39.3 |
In the third quarter of 2014, administration expenses reported under Corporate and Other decreased slightly to € 49 million (Q3 2013: € 50 million). Other operating expenses (net) rose to € –22 million (Q3 2013: € –7 million). This increase was mainly attributable to the development of one-time expenses, which rose from € –4 million in the year-earlier period to € –22 million. In this connection, mention should be made of one-time expenses for IT costs, in particular, which rose from € –2 million to € –11 million. Taking these effects into account, in the third quarter EBIT amounted to € –74 million (Q3 2013: € –57 million) and EBITDA was € –66 million (Q3 2013: € –53 million). Adjusted for one-time effects, EBITDA pre one-time items amounted to € –44 million (Q3 2013: € –49 million). This also had an impact on the development of business free cash flow, which improved to € –52 million (Q3 2013: € –55 million).
In the first nine months of 2014, EBITDA pre one-time items of Corporate and Other totaled € –112 million (Jan.–Sept. 2013: € –143 million). Business free cash flow also improved considerably and amounted to € –130 million (Jan.–Sept. 2013: € –214 million).
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