Philips 2004 Annual Report Download - page 127

The bonds and warrant bonds were redeemed in shares on August 16, 2003. As a consequence,
Philips’ shareholding was diluted from 48.4% to 44.7%.
According to TSMC’s Articles of Incorporation, yearly bonuses to employees have been
granted partially in shares. Generally, stock dividends will also be paid. During the third quarter
of 2003, new shares were issued in grants to employees and as a stock dividend. Since Philips
only participates in the stock dividend distribution, its shareholding in TSMC was diluted as a
result of shares issued to employees.
2002
In 2002, the dilution effect of Philips’ shareholding in TSMC reduced Philips’ interest by 0.12%.
Investment impairment charges
2002 2003 2004
LG.Philips Displays (275) (411) –
Atos Origin (921) – –
Others (109) (20) (8)
Total (1,305) (431) (8)
2004
Investment impairment charges in 2004 relate to a few smaller investments.
2003
In 2003, LG.Philips Displays (LPD) was impacted by worsening market conditions and increased
price erosion, mainly caused by the rapid penetration of Liquid Crystal Display panels for
application in TV and monitors. For LPD, the revised market outlook resulted in a non-cash
asset impairment charge of USD 771 million and in restructuring charges of approximately
USD 171 million in 2003.
2002
The Company recognized impairment charges of EUR 1,305 million in 2002. These charges
related to the investment in LPD (EUR 275 million), a write-down of the investment in Atos
Origin (EUR 921 million) to its lower market value, and write-downs of several smaller
investments (EUR 109 million).
Amortization of goodwill
2002 2003 2004
Atos Origin (24) – –
Total (24) – –
2002
The amortization of goodwill in 2002 related to the fourth quarter of 2001 of Atos Origin, as
the latter’s results were reported on a three-month delay basis.
126 Philips Annual Report 2004
Financial statements of the Philips Group