BMW 2015 Annual Report Download - page 59

59 COMBINED MANAGEMENT REPORT
Bayerische Motoren Werke Aktiengesellschaft (BMW AG),
based in Munich, Germany, is the parent company of
the BMW Group. The comments on the BMW Group
and Automotive segment provided in earlier sections
are also relevant for BMW AG, unless presented differ-
ently in the following section. The Financial Statements
of BMW AG are drawn up in accordance with the pro-
visions of the German Commercial Code (HGB) and
the relevant supplementary provisions contained in
the German Stock Corporation Act (AktG).
The main financial and non-financial performance indi-
cators relevant for BMW AG are largely identical and
synchronous with those of the Automotive segment
of the BMW Group and are described in detail in the
“Report on Economic Position” section of the Combined
Management Report.
Differences between the accounting policies used in the
BMW AG financial statements (prepared in accordance
with HGB) and the BMW Group Financial Statements
(prepared in accordance with IFRS) arise primarily in
connection with the accounting treatment of intangible
assets, financial instruments, provisions and deferred
taxes.
Business environment and review of operations
The general and sector-specific environment in which
the BMW AG operates is the same as that for the
BMW Group and is essentially described in the “Report
on Economic Position” section of the Combined Manage-
ment Report.
BMW AG develops, manufactures and sells cars and
motorcycles as well as spare parts and accessories manu-
factured by itself, foreign subsidiaries and external
suppliers. Sales activities are carried out primarily
through branches, subsidiaries, independent dealers
and importers. In 2015, BMW AG increased sales vol-
ume by 108,595 units to 2,275,367 units. This figure
includes 287,755 units relating to series sets supplied
to the joint venture BMW Brilliance Automotive Ltd.,
Shenyang, an increase of 289 units over the previous
year. At 31 December 2015, BMW AG employed a work-
force of 84,860 people, 4,185 more than one year earlier.
Results of operations
Revenues increased by 8.7 % compared to the previous
year, primarily as a result of higher sales volume. In geo-
graphical terms, most of the increase related to North
America and Europe. Sales to Group entities accounted
for € 55.5 billion or 76.7 % of total revenues of € 72.4 billion.
Cost of sales increased by 11.5 % to € 57,764 million and
therefore at a more pronounced rate than the increase in
revenues, mainly reflecting higher purchase prices from
production sites outside Germany and the intragroup
transfer of prior-year warranty expenses from one of the
Group’s sales company to BMW AG. As a result, gross
profit decreased by € 167 million to € 14,620 million.
Report on Economic Position
Comments on Financial Statements of BMW AG
BMW AG Income Statement
in € million
2015 2014
Revenues 72,384 66,599
Cost of sales – 57,764 – 51,812
Gross profit 14,620 14,787
Selling expenses – 3,427 – 3,533
Administrative expenses – 2,610 – 2,259
Research and development expenses – 4,758 – 4,152
Other operating income and expenses 184 28
Result on investments 1,606 741
Financial result – 1,043 – 449
Profit from ordinary activities 4,572 5,163
Income taxes – 1,782 – 1,884
Other taxes – 49 – 50
Net profit 2,741 3,229
Transfer to revenue reserves – 639 – 1,325
Unappropriated profit available for distribution 2,102 1,904