Merck 2014 Annual Report Download - page 107

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102 GROUP MANAGEMENT REPORT → REPORT ON ECONOMIC POSITION → Biopharmaceuticals
1 Quarterly breakdown unaudited.
2 Previous year’s figures have been adjusted, see “The Group" in the Group management report.
2014
2013
0.1
438
438
Q1 →
Q2 →
Q3 →
Q4 →
452
475
– 4.8
449
467
– 4.0
492
475
3.6
%
BIOPHARMACEUTICALS →
EBITDA PRE ONE-TIME ITEMS AND CHANGE BY QUARTER1, 2
€ million / change in %
The strong improvement in other operating expenses and income
(net) in 2014 mainly reflected the adjustment of provisions for
litigation (see also “Other operating income and expenses” in the
Notes to the Group accounts), as well as to the reduction in one-
time expenses. Other operating expenses and income were affect-
ed by higher one-time expenses and impairments of intangible
assets in connection with the discontinuation of multiple research
projects (see “Intangible assets” in the Notes to the Group accounts).
After eliminating depreciation and amortization, and adjusted for
one-time items, EBITDA pre one-time items declined by –1.3 % to
€1,831 million and the EBITDA margin pre one-time items was
31.7 % (2013: 32.6 %).
The development of EBITDA pre one-time items in the indi-
vidual quarters in comparison with 2013 is presented in the fol-
lowing overview:
Development of business free cash flow
In 2014, the Biopharmaceuticals division’s business free cash flow
amounted to €1,577 million, falling short of the very high level
of €1,787 million in 2013. The decline of €210 million was attrib-
utable to both higher capital spending as well as the development
of inventories as well as trade accounts receivable, with foreign
exchange effects accounting for the increase in both balance sheet
items in 2014.
BIOPHARMACEUTICALS →
BUSINESS FREE CASH FLOW
€ million 2014 20131
Change
in %
EBITDA pre one-time items 1,830.9 1,855.1 –1.3
Investments in property, plant and equipment, software
as well as advance payments for intangible assets
– 229.5
–164.3
39.7
Changes in inventories – 21.8 41.7 –152.0
Changes in trade accounts receivable – 2.4 54.6 –104.4
Business free cash flow 1,577.2 1,787.1 – 11.7
1 Previous year’s figures have been adjusted, see “The Group" in the Group management report.