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:
|
|
2022 |
|
2021 |
|---|---|---|---|---|
|
|
|
|
|
APM Adjustments (continuing operations) |
|
|
|
|
- Acquisitions/divestments |
|
4 |
|
21 |
- Restructuring |
|
87 |
|
76 |
- Other |
|
- |
|
(6) |
- Impairments/(reversals) of PPE and intangible assets |
|
(6) |
|
6 |
- Financial income and expense |
|
8 |
|
- |
- Income tax related to adjustments |
|
(15) |
|
(25) |
- Adjustments to result from associates and joint ventures |
|
2 |
|
(319) |
Total APM adjustments (income)/expense |
|
80 |
|
(247) |
2022
The main APM adjustments in 2022 are listed below:
- Restructuring costs of €87 million relate mainly to restructuring projects, following the new strategy and the announced intention for the merger with Firmenich, including the redundancy schemes associated with the dismissal of employees and costs of termination of contracts
2021
The main APM adjustments in 2021 are listed below:
- Acquisition and divestment costs of €21 million relate mainly to the acquisition and integration of Erber and First Choice Ingredients
- Restructuring costs of €76 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 and a profit of €13 million on a higher earn-out relating to previous divestments
|
|
2022 |
|
2021 |
|---|---|---|---|---|
|
|
|
|
|
Operating profit |
|
682 |
|
711 |
Depreciation, amortization and impairments |
|
622 |
|
577 |
EBITDA |
|
1,304 |
|
1,288 |
|
|
|
|
|
APM adjustments to EBITDA: |
|
|
|
|
- Acquisitions/divestments |
|
4 |
|
21 |
- Restructuring |
|
87 |
|
76 |
- Other |
|
- |
|
(6) |
Total APM adjustments |
|
91 |
|
91 |
Adjusted EBITDA |
|
1,395 |
|
1,379 |
|
|
|
|
|
Operating profit |
|
682 |
|
711 |
|
|
|
|
|
APM adjustments to Operating profit: |
|
|
|
|
- APM adjustments to EBITDA |
|
91 |
|
91 |
- Impairments/(reversals) of PPE and Intangible assets |
|
(6) |
|
6 |
Total APM adjustments |
|
85 |
|
97 |
Adjusted operating profit |
|
767 |
|
808 |
|
|
|
|
|
Net profit from continuing operations |
|
475 |
|
830 |
|
|
|
|
|
APM adjustments to: |
|
|
|
|
- Operating profit |
|
85 |
|
97 |
- Financial income and expense |
|
8 |
|
- |
- Result relating to associates/joint ventures |
|
2 |
|
(319) |
Income tax related to APM adjustments |
|
(15) |
|
(25) |
Total APM adjustments |
|
80 |
|
(247) |
Adjusted net profit from continuing operations |
|
555 |
|
583 |
|
|
|
|
|
Profit attributable to non-controlling interests |
|
(13) |
|
(2) |
Dividend on Cumulative Preference Shares |
|
(6) |
|
(6) |
Adjusted net profit from continuing operations available to holders of ordinary shares |
|
536 |
|
575 |
The below table reflects the earnings per share (EPS) related to continuing operations and to total earnings including discontinued operations.
|
|
2022 |
|
2021 |
||||
|---|---|---|---|---|---|---|---|---|
|
|
Continuing operations |
|
Total |
|
Continuing operations |
|
Total |
|
|
|
|
|
|
|
|
|
Earnings per share (EPS) |
|
|
|
|
|
|
|
|
Average number of ordinary shares outstanding (x 1,000) |
|
|
|
172,827 |
|
|
|
172,648 |
Effect of dilution due to share options (x 1,000) |
|
|
|
477 |
|
|
|
747 |
Adjusted average number of ordinary shares outstanding (x 1,000) |
|
|
|
173,304 |
|
|
|
173,395 |
|
|
|
|
|
|
|
|
|
x € million |
|
|
|
|
|
|
|
|
Net profit available to holders of ordinary shares |
|
456 |
|
1,694 |
|
822 |
|
1,670 |
Adjusted net profit available to holders of ordinary shares |
|
536 |
|
776 |
|
575 |
|
869 |
|
|
|
|
|
|
|
|
|
in € |
|
|
|
|
|
|
|
|
Net basic EPS |
|
2.64 |
|
9.80 |
|
4.76 |
|
9.68 |
Net diluted EPS |
|
2.63 |
|
9.77 |
|
4.74 |
|
9.63 |
Adjusted net basic EPS |
|
3.10 |
|
4.49 |
|
3.33 |
|
5.03 |
Adjusted net diluted EPS |
|
3.09 |
|
4.48 |
|
3.32 |
|
5.01 |
|
|
2022 |
|
2021 |
|---|---|---|---|---|
|
|
|
|
|
Capital employed |
|
|
|
|
Intangible assets |
|
5,147 |
|
5,309 |
Property, plant and equipment |
|
3,576 |
|
3,964 |
Investment grants/drawing rights |
|
(55) |
|
(111) |
Inventories |
|
2,339 |
|
2,297 |
Current receivables |
|
1,622 |
|
1,697 |
Current liabilities |
|
(1,969) |
|
(2,188) |
Included discontinued operations |
|
- |
|
(954) |
Capital employed at 31 December |
|
10,660 |
|
10,014 |
|
|
|
|
|
Average capital employed |
|
|
|
|
Capital employed at 1 January |
|
10,014 |
|
8,741 |
Capital employed at 31 March |
|
10,229 |
|
9,082 |
Capital employed at 30 June |
|
10,626 |
|
9,100 |
Capital employed at 30 September |
|
11,402 |
|
9,438 |
Capital employed at 31 December |
|
10,660 |
|
10,014 |
Average capital employed |
|
10,586 |
|
9,275 |
Adjusted operating profit, continuing operations |
|
767 |
|
808 |
ROCE in %, continuing operations |
|
7 |
|
9 |
|
|
|
|
|
Cash provided by operating activities |
|
965 |
|
1,427 |
Cash impact APM adjustments |
|
111 |
|
91 |
Capital expenditure |
|
(644) |
|
(570) |
Payments regarding drawing rights |
|
(7) |
|
(7) |
Adjusted net operating free cash flow |
|
425 |
|
941 |
Adjusted net operating free cash flow, continuing operations |
|
310 |
|
626 |
