3.4 Theoretical equity and goodwill movement
The goodwill additions of CHF 118.0 million (2020/21: CHF 17.8 million) and the disposal of CHF 50.9 million (2020/21: CHF 0.0 million) resulting from business acquisitions and divestments are offset as disclosed in the consolidated statement of changes in equity. See also the note on business combinations and divestments (4.3). The following tables show the impact on equity and net profit based on the assumption that the goodwill was capitalized and amortized over a period of five years.
|
CHF million |
|
Financial year ended 30.06.2022 |
|
Financial year ended 30.06.2021 |
|
Theoretical book value of goodwill, net |
|
169.2 |
|
205.1 |
|
Cost 30 June |
|
2,115.6 |
|
2,035.3 |
|
Additions from acquisitions |
|
118.0 |
|
17.8 |
|
Disposals |
|
–50.9 |
|
0.0 |
|
Translation exchange differences |
|
13.2 |
|
–9.2 |
|
Cost 1 July |
|
2,035.3 |
|
2,026.7 |
|
Accumulated amortization 30 June |
|
1,946.4 |
|
1,830.2 |
|
Additions |
|
151.9 |
|
205.7 |
|
Impairment |
|
0.0 |
|
4.0 |
|
Disposals |
|
–50.9 |
|
0.0 |
|
Translation exchange differences |
|
15.2 |
|
0.0 |
|
Accumulated amortization 1 July |
|
1,830.2 |
|
1,620.5 |
The disclosed disposal of CHF 50.9 million relates to the divestments of the Mesker and interior glass systems business. This disposal of goodwill affects consolidated income, but, does not impact the Group’s cash flow.
|
|
|
Financial year ended 30.06.2022 |
|
Financial year ended 30.06.2021 |
||||||||
|
CHF million |
|
Effective |
|
Amorti- zation goodwill |
|
Theoretical (incl. amorti- zation goodwill) |
|
Effective |
|
Amorti- zation goodwill |
|
Theoretical (incl. amorti- zation goodwill) |
|
Effects on the income statement |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit (EBIT) |
|
204.8 |
|
–151.9 |
|
52.9 |
|
274.3 |
|
–209.7 |
|
64.6 |
|
EBIT as % of net sales |
|
7.4 |
|
–5.5 |
|
1.9 |
|
11.0 |
|
–8.4 |
|
2.6 |
|
Net profit |
|
122.5 |
|
–151.9 |
|
–29.4 |
|
193.3 |
|
–209.7 |
|
–16.4 |
|
Effect on the balance sheet |
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity according to balance sheet |
|
195.9 |
|
169.2 |
|
365.1 |
|
264.9 |
|
205.1 |
|
470.0 |
|
Equity as % of balance sheet total |
|
10.3 |
|
|
|
17.6 |
|
14.2 |
|
|
|
22.6 |
Accounting principles
As goodwill is fully offset in equity at the date of acquisition, an impairment of goodwill does not affect income; it is only disclosed in the notes to the consolidated financial statements.
Goodwill represents the excess of the consideration transferred, the amount of any non-controlling interest in the acquired entity, and the book value as at the acquisition date of any previous equity interest in the acquired entity over the fair value of the Group’s share of the identifiable net assets acquired. Only intangible assets purchased separately are recognized as part of an acquisition. The positive or negative goodwill resulting from acquisitions is offset in equity at the date of acquisition against retained earnings.
If the purchase price contains elements that are dependent on future results, they are estimated as accurately as possible at the date of acquisition and recognized in the balance sheet. In the event of any disparities when the definitive purchase price is settled, the goodwill offset in equity is adjusted accordingly. The consequences of a theoretical capitalization and amortization of goodwill are explained in the note on the theoretical movement of goodwill.