Merck 2014 Annual Report Download - page 231

226 CONSOLIDATED FINANCIAL STATEMENTS → Notes to the Group accounts
INFORMATION BY COUNTRY AND REGION
Europe thereof Germany thereof France thereof Switzerland
€ million 2014 2013 2014 2013 2014 2013 2014 2013
Sales by customer location 4,014.6 3,984.6 845.2 825.4 648.3 677.0 149.3 159.0
Sales by company location 4,520.1 4,457.5 1,592.0 1,570.8 779.1 790.8 182.5 188.6
Total revenues 4,674.1 4,686.6 1,618.0 1,596.8 840.1 812.5 247.5 364.5
Intangible assets 7,966.3 7,572.4 448.9 398.0 269.2 278.0 4,151.4 4,692.3
Property, plant and
equipment 2,163.1 2,075.2 1,032.8 997.5 205.4 183.6 498.2 508.0
Research and development
costs1–1,550.7 –1,359.7 – 816.0 – 851.3 – 56.9 – 56.4 – 604.8 – 411.4
Number of employees 20,537 20,013 11,191 10,868 2,943 2,946 1,347 1,232
1 The disclosure of amortization of intangible assets (excluding software) has been changed. See Note “Accounting and measurement principles”.
(52) INFORMATION ON SEGMENT
REPORTING
Segmentation was performed in accordance with the organizational
and reporting structure of the Group that applied during 2014.
The Biopharmaceuticals division focuses on specialist thera-
peutic areas and markets innovative prescription drugs of chemi-
cal and biotechnological origin. The Consumer Health division
comprises the Group’s business with high-quality over-the-count-
er products for preventive health care and self-treatment of minor
ailments. The Performance Materials division consists of the Liq-
uid Crystals, Pigments & Cosmetics and Advanced Technologies
business units as well as the businesses of the AZ Electronic Ma-
terials Group, which were added in 2014. The Life Science division
offers solutions to research and analytical laboratories in the
pharmaceutical / biotechnology industry or in academic institu-
tions, and customers manufacturing large- and small-molecule
drugs. The fields of activity of the individual divisions are described
in detail in the sections about the divisions in the Group manage-
ment report.
Corporate and Other includes assets and liabilities as well as
income and expenses that are largely allocable to Group functions
and thus cannot be directly allocated to the reportable segments
presented; it serves the reconciliation to the Group numbers. The
cash flows attributable to the financial result and income taxes are
also presented under Corporate and Other.
Apart from sales, the success of a segment is mainly determined
by EBITDA pre one-time items (segment result) and business free
cash flow. EBITDA pre one-time items and business free cash flow
are performance indicators not defined by International Financial
Reporting Standards. However, they represent important variables
used to steer the Group. To permit a better understanding of oper-
ational performance, EBITDA pre one-time items excludes depre-
ciation and amortization in addition to specific income and ex-
penses of a one-time nature presented in the following. Among
other things, business free cash flow is also used for internal target
agreements and individual incentive plans.
Transfer prices for intragroup sales are determined on an
arm’s-length basis.
The Emerging Markets region comprises Latin America and
Asia with the exception of Japan. The Rest of World region com-
prises Japan, Africa and Australia / Oceania.
Neither in 2014 nor in 2013 did any single customer account
for more than 10 % of Group sales.