Philips 2008 Annual Report Download - page 227

Results on sales of shares
2006 2007 2008
FEI Company 103 −−
LG Display −654 −
Others 3 6 (2)
106 660 (2)
2007
In 2007, Philips sold 46,400,000 shares of LG Display common stock,
resulting in a gain of EUR 654 million. As a result of the sale, Philips’
shareholding in LG Display was reduced from 32.9% to 19.9%.
2006
In 2006, Philips sold its remaining interest of 24.8% in FEI Company
(see note 39).
Investment impairment/other charges
2006 2007 2008
LG.Philips Displays (61) (22) (9)
Others (9) −(63)
(70) (22) (72)
2008
The category ‘Others’ includes an impairment charge related to our
12.4% interest in TPV. Philips performed impairment reviews on the
book value of the investment in TPV in 2008. We concluded that an
impairment charge of EUR 59 million was required. The impairment
reviews in 2008 were triggered by the deteriorating economic
environment of the flat panel industry, the weakening financial
performance of TPV and the stock price performance of TPV. The
valuation as per December 31, 2008 was based on the stock price
of TPV as of that date on the Hong Kong Stock Exchange.
2007
The voluntary support of social plans for employees impacted by the
bankruptcy of certain LG.Philips Displays activities amounted to EUR
22 million.
2006
The voluntary support of social plans for employees impacted by the
bankruptcy of certain LG.Philips Displays activities amounted to EUR
61 million.
Investments in equity-accounted investees
The changes during 2008 are as follows:
Investments in equity-accounted investees investments
Investments in equity-accounted investees as of
January 1, 2008 1,817
Changes:
Acquisitions/additions 62
Sales/repayments (3)
Transfer to other non-current financial assets (1,531)
Share in income/value adjustments 30
Dividends received (65)
Translation and exchange rate differences (17)
Investments in equity-accounted investees
as of December 31, 2008 293
The EUR 1,531 million reported on Transfer to other non-current
financial assets relates to the investment in LG Display.
43
Included in investments is EUR 25 million (2007: EUR 339 million),
representing the excess of the Company’s investment over its
underlying equity in the net assets of the equity-accounted investees.
The total carrying value of investments in, and loans to, equity-
accounted investees is summarized as follows:
2007 2008
share-
holding % amount
share-
holding % amount
LG Display 19.9 1,535 −−
Other investments in
equity-accounted
investees 282 293
1,817 293
The category Other equity-accounted investees includes the
investment in TPV (12.4%, carrying value EUR 60 million) and InterTrust
Technologies Corporation (49.5%, carrying value EUR 64 million).
The Company owns TPV bonds which have convertible rights that
potentially could result in significant influence.
The investments in equity-accounted investees are mainly included
in the Group Management & Services sector.
Summarized information of investments in equity-accounted investees
Summarized financial information on the Company’s investments in
equity-accounted investees, on a combined basis, is presented below:
2006 2007 2008
Net sales 13,599 15,799 6,951
Income (loss) before taxes (613) 1,233 538
Income taxes 189 (154) (109)
Other income (loss) (37) (1) −
Net income (loss) (461) 1,078 429
Total share in net income of equity-
accounted investees recognized in the
consolidated statements of income (188) 246 81
December 31,
2007 2008
Current assets 6,116 2,781
Non-current assets 6,766 685
12,882 3,466
Current liabilities (3,339) (2,134)
Non-current liabilities (2,578) (184)
Net asset value 6,965 1,148
Investments in equity- accounted investees included
in the consolidated balance sheet 1,817 293
Philips Annual Report 2008 227
254
Corporate governance
250
Reconciliation of
non-US GAAP information
262
Ten-year overview
266
Investor information