Shareholders' equity

 
2016
2015
   
Balance at 1 January
5,541
5,723
   
Net profit
621
88
Exchange differences, net of income tax
197
16
Net actuarial gains/(losses) on defined benefit obligations
(9)
(54)
Dividend
(296)
(297)
Repurchase of shares
(273)
(122)
Proceeds from reissue of ordinary shares
253
176
Other changes
38
11
   
Balance at 31 December
6,072
5,541

For details see the consolidated statement of changes in equity (Note 16) and Consolidated statement of changes in equity (Note 16).

Legal reserve

In Shareholders' equity, an amount of €530 million (2015: €314 million) is included for Translation reserve,-€207 million (2015: -€203 million) for Hedging reserve, €8 million (2015: -€3 million) for Fair value reserve and -€100 million(2015: -€86 million) for intangible assets related to product development projects.
In addition, a legal reserve of €120 million (2015: €111 million) is recognized for profits that cannot be distributed and received in the Netherlands.

Profit appropriation

According to article 32 of the Articles of Association of Koninklijke DSM N.V. and with the approval of the Supervisory Board, every year the Managing Board determines the portion of the net profit to be appropriated to the reserves. For the year 2016 the net profit is €621 million and the amount to be appropriated to the reserves has been established at €311 million. From the subsequent balance of the net profit of €310 million, dividend is first distributed on the cumulative preference shares B. At the end of 2016 no cumprefs B were in issue. Subsequently, a 1.759% dividend is distributed on the cumulative preference shares A, based on a share price of €5.29 per cumulative preference share A. For 2016 this distribution amounts to €0.09 per share, which is €4 million in total. An interim dividend of €0.03 per cumulative preference share A having been paid in August 2016, the final dividend will then amount to €0.06 per cumulative preference share A.

The profit remaining after distribution of these dividends on the cumulative preference shares A (€617 million) will be put at the disposal of the Annual General Meeting of Shareholders in accordance with the provisions of Article 32, section 5 of the Articles of Association.

The Managing Board proposes a dividend on ordinary shares outstanding for the year 2016 of €1.75 per share. With an interim dividend of €0.55 per ordinary share having been paid in August 2016, the final dividend would then amount to €1.20 per ordinary share.

If the Annual General Meeting of Shareholders makes a decision in accordance with the proposal, the net profit will be appropriated as follows:

 
2016
2015
   
Net profit
621
88
   
Profit appropriation:
  
- To be added to / paid from the reserves
311
(210)
- Dividend on cumprefs A
4
10
- Interim dividend on ordinary shares
96
96
- Final dividend distributable on ordinary shares
210
192