Siemens 2013 Annual Report Download - page 175

253 D. Consolidated Financial Statements
357 E. Additional Information
245 C. Compensation Report, Corporate Governance
statement pursuant to Section a of the
German Commercial Code, Takeover-relevant
information and explanatory report
246 C. Siemens AG ( Discussion on basis of
German Commercial Code)
250 C. Notes and forward-looking statements

C.. Dividend and share buybacks
We intend to continue providing an attractive return to share-
holders. Therefore in the years ahead we intend to propose a
dividend payout which, combined with outlays during the fis-
cal year for publicly announced share buybacks, results in a
sum representing % to % of net income, which for this
purpose we may adjust to exclude selected exceptional non-
cash effects. Furthermore, for fiscal , we are taking pro-
ceeds from the sale of the NSN stake in fiscal  into consid-
eration. As in the past, we intend to fund the dividend payout
from Free cash flow.
At the Annual Shareholders’ Meeting, the Managing Board, in
agreement with the Supervisory Board, will submit the follow-
ing proposal to allocate the unappropriated net income of
Siemens AG for the fiscal year ended September , : to
distribute a dividend of €. on each no-par value share enti-
tled to the dividend for fiscal year  existing at the date of
the Annual Shareholders’ Meeting, with the remaining amount
to be carried forward. Payment of the proposed dividend is
contingent upon approval by Siemens shareholders at the
Annual Shareholders’ Meeting on January , . The prior
year dividend was €. per share.
The proposed dividend of €. per share for fiscal  rep-
resents a total payout of €. billion based on shares out-
standing as of September , . Based on net income of
€. billion for fiscal , the dividend payout percentage
would be %. The percentage for fiscal  was %, based
on a total dividend payout of €. billion and a net income of
€. billion. Net income in fiscal  was adjusted retro-
spectively for effects of adopting IAS R.
Outlays for Siemens publicly announced share buybacks (ex-
cluding incidental transaction charges) during fiscal 
totaled €. billion and represent % of net income. The
percentage for fiscal  was % with outlays for share
buybacks in the amount of €. billion.
With the spin-off of OSRAM in fiscal , Siemens sharehold-
ers received one OSRAM share per ten Siemens AG shares. For
additional information regarding the spin-off of OSRAM, see
C... BUSINESS DESCRIPTION.
C.. Additional measures
In addition to the financial performance measures discussed
above, we use several other financial measures to assess the
economic success of our business activities. To determine
whether a particular investment is likely to generate value for
Siemens, we use net present value or economic value added
(EVA™). EVA™ considers the cost of capital in calculating value
creation by comparing the expected earnings of an investment
against the cost of capital employed. EVA™ is also an indicator
for measuring capital efficiency in our Sectors and at SFS.
To measure liquidity management of our operating activities,
we analyze net operating working capital turns. In addition,
we set hurdle rates that generally must be considered before
we make acquisitions. In particular, acquisitions should have
the potential to be accretive to EVA™ within three years after
the integration and generate a % cash return within five
years. Cash return is defined as Free cash flow divided by
average capital employed.
Dividend payout percentage
FY  57%
FY  59%
Total dividend payout
× 100%
Net income