Measurement bases for the performance of the reportable segments
All transactions between reportable segments are measured on the basis of standard market transfer prices that would also be applicable to transactions at arm’s length. Cross-segment transactions within the Group are consolidated in the consolidation column, whereas income from dividend payments and profit/loss transfer agreements accruing to the Group holding company are eliminated in the respective segment. For reasons of consistency and comparability, we have adjusted the segment statement of income in line with the consolidated statement of income. The same applies to the segment balance sheet and the consolidated balance sheet.
Depending upon the nature and time frame of the commercial activities, various management metrics and performance indicators are used to assess the financial success of the reportable segments within the Group. However, the operating profit (EBIT) – determined from International Financial Reporting Standards – IFRS profit contributions – is used as a consistent measurement basis. Net profit or loss for the period before income taxes is highlighted as a means of capturing true operating profitability and for the sake of better comparability. In addition, the result is adjusted for interest charges incurred for borrowing (financing costs).