Philips 2014 Annual Report Download - page 43

Group performance 5.3.3
Annual Report 2014 43
Philips Group
Restricted and hazardous substances in kilos
2010 - 2014
2010 2011 2012 2013 2014
Restricted
substances 188 111 55 9 9
Hazardous
substances 60,272 63,604 67,530 35,118 28,310
For more details on restricted and hazardous
substances, please refer to sub-section 14.3.3, Green
Operations, of this Annual Report
5.4 Proposed distribution to shareholders
Pursuant to article 34 of the articles of association of
Royal Philips, a dividend will rst be declared on
preference shares out of net income. The remainder of
the net income, after reservations made with the
approval of the Supervisory Board, shall be available
for distribution to holders of common shares subject to
shareholder approval after year-end. As of December
31, 2014, the issued share capital consists only of
common shares; no preference shares have been
issued. Article 33 of the articles of association of Royal
Philips gives the Board of Management the power to
determine what portion of the net income shall be
retained by way of reserve, subject to the approval of
the Supervisory Board.
A proposal will be submitted to the 2015 Annual
General Meeting of Shareholders to declare a dividend
of EUR 0.80 per common share (up to EUR 735 million),
in cash or in shares at the option of the shareholder,
against the net income for 2014 and retained earnings.
Shareholders will be given the opportunity to make
their choice between cash and shares between May 13,
2015 and June 5, 2015. If no choice is made during this
election period the dividend will be paid in shares. On
June 5, 2015 after close of trading, the number of share
dividend rights entitled to one new common share will
be determined based on the volume weighted average
price of all traded common shares Koninklijke Philips
N.V. at Euronext Amsterdam on June 3,4 and 5, 2015.
The Company will calculate the number of share
dividend rights entitled to one new common share (the
‘ratio’), such that the gross dividend in shares will be
approximately equal to the gross dividend in cash. On
June 9, 2015 the ratio and the number of shares to be
issued will be announced. Payment of the dividend and
delivery of new common shares, with settlement of
fractions in cash, if required, will take place from June
10, 2015. The distribution of dividend in cash to holders
of New York Registry shares will be made in USD at the
USD/EUR rate xed by the European Central Bank on
June 8, 2015.
Dividend in cash is in principle subject to 15% Dutch
dividend withholding tax, which will be deducted from
the dividend in cash paid to the shareholders. Dividend
in shares paid out of net income and retained earnings
is subject to 15% dividend withholding tax, but only in
respect of the par value of the shares (EUR 0.20 per
share).
In 2014, a dividend of EUR 0.80 per common share was
paid in cash or shares, at the option of the shareholder.
For 60% of the shares, the shareholders elected for a
share dividend resulting in the issue of 18,811,534 new
common shares, leading to a 2.1% percent dilution. EUR
292 million was paid in cash. For additional information,
see chapter 17, Investor Relations, of this Annual Report.
The balance sheet presented in this report, as part of
the Company nancial statements for the period ended
December 31, 2014, is before appropriation of the result
for the nancial year 2014.
5.5 Outlook
Overall, 2014 was a setback in our performance
trajectory. We have been taking clear actions to drive
stronger operational performance across our
businesses and expect sales growth and EBITA margin
improvements in 2015 and beyond. However, looking
ahead, we remain cautious regarding the
macroeconomic outlook and expect ongoing volatility
of some of our end-markets. We also anticipate further
restructuring and separation costs in 2015 and 2016.
Due to these factors, we are tracking 1 percentage point
behind on the path to achieving each of our 2016
comparable sales growth, EBITA and ROIC Group
targets. We are convinced that this does not change our
longer-term performance potential, considering the
attractiveness of the Lighting Solutions and HealthTech
markets and our competitive position. Later this year, as
we progress with the separation of Philips and
reallocation of IG&S, we will update the market about
the integral performance targets for each of the two
operating companies.