Philips 2015 Annual Report Download - page 219

Reconciliation of non-GAAP information 15
Annual Report 2015 219
15 Reconciliation of non-GAAP
information
Explanation of Non-GAAP measures
Koninklijke Philips N.V. (the ‘Company’) believes that an understanding of sales performance, capital eciency, nancial
strength and its funding requirements is enhanced by introducing certain Non-GAAP measures, respectively
Comparable sales growth, EBITA, Net operating capital, Net debt, and Free cash ow. In this chapter these measures
are further explained and reconciled to GAAP measures.
Comparable sales growth
Comparable sales exclude the eects of currency movements and changes in consolidation. As indicated in note 1,
Signicant accounting policies, sales and income are translated from foreign currencies into the Company’s reporting
currency, the euro, at the exchange rate on transaction dates during the respective years. As a result of signicant
currency movements during the years presented, the eects of translating foreign currency sales amounts into euros
could have a material impact. Therefore, these impacts have been excluded in arriving at the comparable sales in euros.
Currency eects have been calculated by translating previous years’ foreign currency sales amounts into euros at the
following year’s exchange rates in comparison with the sales in euros as historically reported. Years under review were
characterized by a number of acquisitions and divestments, as a result of which activities were consolidated or
deconsolidated. The eect of consolidation changes has also been excluded in arriving at the comparable sales. For the
purpose of calculating comparable sales growth, when a previously consolidated entity is sold or contributed to a
venture that is not consolidated by the Company, relevant sales are excluded from impacted prior-year periods. Similarly,
when an entity is acquired, relevant sales are excluded from impacted periods.
Philips Group
Sales growth composition per sector in %
2013 - 2015
comparable growth currency eects
consolidation
changes nominal growth
2015 versus 2014
Healthcare 3.8 11.7 3.3 18.8
Consumer Lifestyle 5.8 7.2 0.0 13.0
Lighting (2.8) 8.5 2.2 7.9
Innovation, Group & Services 5.4 1.7 (12.2) (5.1)
Philips Group 2.2 9.4 1.7 13.3
2014 versus 2013
Healthcare (2.0) (1.6) (0.5) (4.1)
Consumer Lifestyle 5.8 (3.1) 0.0 2.7
Lighting (2.6) (2.3) 1.0 (3.9)
Innovation, Group & Services (11.8) (0.1) 2.9 (9.0)
Philips Group (0.9) (2.0) 0.2 (2.7)
2013 versus 2012
Healthcare 0.8 (4.6) (0.3) (4.1)
Consumer Lifestyle 10.0 (3.4) 0.0 6.6
Lighting 1.3 (3.5) 0.0 (2.2)
Innovation, Group & Services (0.3) (0.4) 6.4 5.7
Philips Group 2.7 (3.9) 0.1 (1.1)