Siemens 2009 Annual Report Download - page 158

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 Reports Supervisory Board /
Managing Board  Corporate Governance  Management’s discussion and analysis  Consolidated Financial Statements
44 Business and operating environment 63 Fiscal 2009 – Financial summary 66 Results of operations 84 Financial position
Income from continuing operations before income taxes
was €3.891 billion for the current fiscal year, compared to
€2.874 billion a year earlier. The change year-over-year was
due to the factors mentioned above, primarily the broad-based
reduction in SG&A expenses and the provision accrued in fiscal
2008 for legal and regulatory matters, partly offset by our fiscal
2009 equity investment loss related to NSN and a negative
swing in Financial income. The effective tax rate on income
from continuing operations was 37% in fiscal 2009, up from
35% in the prior year. The current-year rate was adversely af-
fected by the significant negative swing in Income (loss) from
investments accounted for using the equity method, net, pri-
marily due to NSN, partly offset by the tax-free gain on the sale
of our stake in FSC. For comparison, the tax rate in the prior
year was adversely affected by the provision for legal and regu-
latory matters mentioned above. As a result, income from con-
tinuing operations after taxes was €2.457 billion, up from
€1.859 billion in fiscal 2008.
Discontinued operations include former Com activities as
well as SV, which was sold to Continental AG in the first quar-
ter of fiscal 2008. The former Com activities include the enter-
prise networks business, 51% of which was divested during the
fourth quarter of fiscal 2008; telecommunications carrier ac-
tivities transferred into NSN in the third quarter of fiscal 2007;
and the mobile devices business sold to BenQ Corporation in
fiscal 2005. Income from discontinued operations in fiscal
2009 was €40 million, compared to €4.027 billion a year earlier.
The difference is due mainly to €5.5 billion in the prior-year
period related to SV, including operating results along with a
substantial gain on the sale of the business. This positive con-
tribution in fiscal 2008 was partly offset by negative effects re-
lated to former Com activities amounting to €1.433 billion, in-
cluding a preliminary loss related to the divestment of the en-
terprise networks business of approximately €1.0 billion and
severance charges and impairments of long-lived assets at the
enterprise networks business. For additional information re-
garding discontinued operations, see “Notes to Consolidated
Financial Statements.”
Net income for Siemens in fiscal 2009 was €2.497 billion,
compared to €5.886 billion a year earlier, with the difference
due primarily to discontinued operations as discussed above.
Net income attributable to shareholders of Siemens AG was
€2.292 billion, down from €5.725 billion in the prior-year pe-
riod.