Siemens 2011 Annual Report Download - page 159

153 D. Consolidated Financial Statements
273 E. Additional information
143 C.2 Additional information for supplemental
financial measures
145 C. Siemens AG (Discussion on basis of
German Commercial Code)
151 C. Notes and forward-looking statements
140 C. Information required pursuant to Section  ()
and Section  () no.  of the German Commer-
cial Code (HGB) and explanatory report
142 C. Compensation report and Corporate Governance
statement pursuant to Section a of the German
Commercial Code (HGB)

Financial Services (SFS). We define ROE (after tax) as SFS’ prof-
it after tax, divided by SFS’ average allocated equity. For pur-
poses of calculating ROE (after tax), the relevant income tax is
calculated on a simplified basis, by applying an assumed %
flat tax rate to SFS’ profit, excluding income (loss) from invest-
ments accounted for using the equity method, net, which is
basically net of tax already, and tax-free income components
and other components which have already been taxed or are
basically tax free. Our goal is to achieve ROE (after tax) of %
to % at SFS. ROE (after tax) at SFS was .% for fiscal 
and .% for fiscal .
We intend to maintain and further improve the profitability of
our businesses. Our goal is to achieve margins comparable to
the best competitors within our industries – throughout the
entire business cycle. Our adjusted EBITDA margins are de-
fined as the ratio of adjusted EBITDA (as presented in C..
Reconciliation to adjusted EBITDA (continuing operations)) to
revenue (as presented in D. Notes to Consolidated Financial
Statements). We have defined adjusted EBITDA margin ranges
for the respective industries of our three Sectors. These mar-
gin ranges are % to % for the industries that our Industry
and Energy Sectors operate in, and % to % in the health-
care industry. The adjusted EBITDA margin for our Industry
Sector was .% in fiscal , up from .% in the prior year.
The adjusted EBITDA margin for Energy was .% in the cur-
rent fiscal year, compared to .% a year earlier. Healthcare’s
adjusted EBITDA margin was .% in fiscal , down from
.% in fiscal . As of the beginning of fiscal , concur-
rent with the launch of the new Infrastructure & Cities Sector,
we have defined new margin ranges for the industries relevant
to that Sector and the Industry Sector in its new composition.
These margin ranges are % to % and % to %, respective-
ly. The margin ranges for the industries relevant to our Energy
and Healthcare Sectors remain unchanged.
C... CAPITAL STRUCTURE
Sustainable profit and revenue can be achieved only on the
basis of a healthy capital structure. A key consideration for us
in this regard is the maintenance of ready access to the capital
markets through various debt products and the preservation
of our ability to repay and service our debt obligations over
time. Therefore, we use the ratio of adjusted industrial net
debt to adjusted EBITDA for optimizing our capital structure.
For information on this calculation and its components see
C.. Capital structure. Our goal is to achieve a ratio in the
range of . – .. Our capital structure ratios in the fiscal
years  and  were (.) and ., respectively.
C... DIVIDEND POLICY
As part of One Siemens, we intend to provide an attractive
dividend payout to our investors. We have therefore estab-
lished a dividend policy of proposing an annual dividend rep-
Return on capital employed (ROCE) (adjusted)
(continuing operations)
FY  24.0%
FY  13.4%
Target range:  – %
Income from continuing operations before interest after tax
× 100%
Average capital employed
Return on Equity (ROE) (after tax)
FY  22.6%
FY  24.8%
Target range:  – %
SFS’ profit after tax
× 100%
SFS’ average allocated equity
Adjusted EBITDA margins FY 
Margin Target range
Industry 13.3% 10 – 15%
Energy 14.3% 10 – 15%
Healthcare 15.7% 15 – 20%
Adjusted EBITDA margins of respective markets throughout business cycle.
Capital structure (continuing operations)
FY  (0.14)
FY  0.22
Target range: . – .
Adjusted industrial net debt
Adjusted EBITDA