2 Alternative performance measures

In presenting and discussing DSM’s financial position, operating results and net results, management uses certain Alternative performance measures not defined by IFRS. These Alternative performance measures (APMs) should not be viewed in isolation as alternatives to the equivalent IFRS measures and should be used as supplementary information in conjunction with the most directly comparable IFRS measures. Alternative performance measures do not have standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other companies.

To provide clear reporting on the developments of the business, APM adjustments, which represent material items of income or expense, are made. These adjustments impact the EBIT(DA), operating profit, net profit, ROCE, cash provided by operating activities and EPS. A reconciliation of the Alternative performance measures to the most directly comparable IFRS measures can be found in the table Alternative performance measures.

The APM adjustments to net profit, as included in the APMs, can be specified as follows:

2021

The APM adjustments in 2021 are listed below:

• Acquisition and divestment costs of €26 million relate mainly to the acquisition and integration of Erber and First Choice Ingredients
• Restructuring costs of €92 million relate mainly to restructuring projects, following the new strategy and the restructuring project at Materials, including the redundancy schemes associated with the dismissal of employees and costs of termination of contracts
• APM adjustments to the result from associates and joint ventures are a profit of €319 million and relate mainly to the book profit of €303 million on the sale of DSM’s share of AOC Aliancys and a profit of €13 million on a higher earn-out relating to previous divestments

2020

The APM adjustments in 2020 are listed below:

• Acquisition and divestment costs of €52 million relate mainly to the acquisition of Glycom, CSK and Erber Group
• Restructuring costs of €103 million relate to restructuring projects (mainly Fit for Growth within Nutrition and Agile to grow within Materials) together with the redundancy schemes associated with the dismissal of employees and costs of termination of contracts
• Impairments of property, plant and equipment (PPE) and intangible assets of €101 million and the other APM adjustment of €11 million relate to an impairment of €56 million of DSM Bio-based Products & Services, owing to an expected subdued market outlook for biofuels which led to insufficient expected future cash flows and an impairment of €56 million relating to DSM Advanced Solar on its solar assets following the sale to Covestro AG
• APM adjustments to the result from associates and joint ventures of €41 million relate mainly to the joint venture POET-DSM, following the decision to mothball the second-generation bio-ethanol plant in Emmetsburg (Iowa, USA), and includes DSM’s equity-accounted share in the impairment loss recognized by the joint venture (€74 million), the impairment of the associated intangible assets (€11 million) and the related tax benefit (€28 million)

Below table reflects the earnings per share (EPS) related to continuing operations and to total earnings including discontinued operations.