BMW 2014 Annual Report Download - page 63

63 COMBINED MANAGEMENT REPORT
BMW AG Income Statement
in € million
2014 2013
Revenues 66,599 60,474
Cost of sales – 51,812 – 47,067
Gross profit 14,787 13,407
Selling expenses – 3,533 – 3,528
Administrative expenses – 2,259 – 2,141
Research and development expenses – 4,152 – 4,362
Other operating income and expenses 28 542
Result on investments 741 373
Financial result – 449 – 328
Profit from ordinary activities 5,163 3,963
Income taxes – 1,884 – 1,629
Other taxes – 50 – 45
Net profit 3,229 2,289
Transfer to revenue reserves – 1,325 – 582
Unappropriated profit available for distribution 1,904 1,707
At € 3,859 million, inventories were practically identical
to the end of the previous year (2013: € 3,863 million).
The decrease in other receivables and other assets to
€ 2,502 million (2013: € 3,194 million) was mainly attribut-
able to the lower volume of genuine repurchase (repo)
transactions in place at the end of the reporting period.
Liquidity within the BMW Group is managed centrally by
BMW AG on the basis of a group-wide liquidity concept,
which revolves around the strategy of concentrating a
significant part of the Group’s liquidity at the level of
BMW AG. An important instrument used to achieve this
aim is the cash pool headed by BMW AG. The liquidity
position reported by BMW AG therefore reflects the
global activities of BMW AG and other Group companies.
Cash and cash equivalents went down by € 684 million
to € 3,073 million. This decrease mainly reflected the
repayment of intragroup borrowings, as a result of
which intragroup refinancing volumes also reduced
significantly.
Equity rose by € 1,537 million to € 12,066 million, while
the equity ratio improved from 31.2 % to 35.2 %.
In order to secure obligations resulting from pre-retire-
ment part-time work arrangements and the Company’s
pension obligations, assets have been transferred to
BMW Trust e.V., Munich, in conjunction with Contrac-
tual Trust Arrangements (CTA), on a trustee basis. The
assets concerned comprise mainly holdings in investment
fund assets and a receivable resulting from a so-called
“Capitalisation Transaction” (Kapitalisierungsgeschäft).
Fund assets are offset against the related guaranteed
obligations. The resulting surplus of assets over liabilities
is reported in the BMW AG balance sheet on the line
“Surplus of pension and similar plan assets over liabili-
ties”.
Pension provisions, net of designated plan assets, de-
creased
from € 43 million to € 12 million.
At € 4,784 million, trade payables were at a similar level
to the previous year (2013: € 4,818 million).
Liabilities to banks increased in conjunction with a
number of project-related loans.
Other liabilities fell from € 285 million to € 216 million,
mainly as a result of the expiry of option contracts.