Philips 2008 Annual Report Download - page 274

Definitions
Cash flow before financing activities: the sum of net cash flow
from operating activities and net cash flow from investing activities
Comparable sales: excludes the effect of currency movements
and acquisitions and divestments (changes in consolidation).
Philips believes that comparable sales information enhances
understanding of sales performance.
Continuing net income: recurring net income from continuing
operations, or net income excluding discontinued operations
and excluding material non-recurring items
Dividend yield: the annual dividend payment divided by Philips’
market capitalization. All references to dividend yield are as of
December 31 of the previous year (the yield on the dividend
paid
in 2008 uses the market capitalization as of December 31, 2007).
EBITA - IFRS: earnings before interest, tax and amortization
(EBITA) represents income from continuing operations
excluding results attributable to minority interest holders,
results relating to equity-accounted investees, income taxes,
financial income and expenses, amortization and impairment
on intangible assets (excluding software and capitalized
development expenses). Philips believes that EBITA information
makes the underlying performance of its businesses more
transparent by factoring out the amortization of intangible
assets, which arises when acquisitions are consolidated.
EBITA – US GAAP: earnings before interest, tax and
amortization (EBITA) represents income from continuing
operations excluding results attributable to minority interest
holders, results relating to equity-accounted investees, income
taxes, financial income and expenses, amortization and
impairment on intangible assets (excluding software) and
write-off of in-process R&D. Philips believes that EBITA
information makes the underlying performance of its businesses
more transparent by factoring out the amortization of intangible
assets, which arises when acquisitions are consolidated.
EBITA per common share: EBITA divided by the weighted
average number of shares outstanding (basic). The same
principle is used for the definition of net income or
stockholders’ equity per common share, replacing EBITA.
Employee Engagement Index (EEI): measures the level of
employee loyalty and satisfaction; expressed as the % of
employees giving a favorable score
Free cash flow: net cash flow from operating activities minus
net capital expenditures
FTE employee: abbreviation for full-time equivalent employee
Income as a % of stockholders’ equity (ROE): measures
income from continuing operations as a percentage of average
stockholders’ equity. ROE rates Philips’ overall profitability by
evaluating how much profit the company generates with the
money shareholders have invested.
Income from continuing operations: net income from continuing
operations, or net income excluding discontinued operations
This report is printed on Magno Satin manufactured at Sappi Fine Paper Mills which are ISO 9001:2000 and
ISO 14001 certified and EMAS registered. The pulp used for Magno is bleached chlorine free. The pulp is made
from timber that is sourced from sustainably managed forests. Sappi Fine Paper Europe (SFPE) has a Group Chain
of Custody Certification for its entire European operations under both the Forest Stewardship Council (FSC)
and the Programme for the Endorsement of Forest Certification Systems (PEFC) schemes.
Philips Annual Report 2008274