Siemens 2014 Annual Report Download - page 243

247 D. Consolidated Financial Statements
337 E. Additional Information
213 C. Overall assessment of the economic position
214 C. Subsequent events
215 C. Sustainability and citizenship
225 C. Report on expected developments and
associated material opportunities and risks
242 C. Compensation Report and legal disclosures
242 C. Siemens AG (Discussion on basis
of German Commercial Code)

The increase in Revenue is due primarily to revenue increases
of € . billion in the Energy Sector, €  million in the Indus-
try Sector and €  million in the Infrastructure & Cities Sector.
These increases were partly offset by revenue declines of
€  million in the Healthcare Sector and €  million in
Siemens Real Estate. As a consequence of the mutual agree-
ment procedure with tax authorities related to transfer pricing,
Siemens AG received compensatory payments from Siemens
Healthcare U.S. The payments amounted to €  million, com-
pared to €  million in the prior year, and were booked as rev-
enue by the Healthcare Sector. On a geographic basis, revenue
grew  % year-over-year in the Asia, Australia region and de-
clined  % in the Americas region and  % in the Europe, C.I.S.,
Africa, Middle East region. Exports from Germany accounted
for  % and  % of revenue in fiscal  and , respec-
tively. In fiscal , orders for Siemens AG amounted to
€ . billion, nearly level compared to the prior year.
The increase in Gross profit included increases of €  million
in the Energy Sector, €  million in the Industry Sector
and €  million in the Infrastructure & Cities Sector. These
increases were partly offset by a decrease of €  million in the
Healthcare Sector. A year earlier, gross profit was burdened by
charges for the company-wide “Siemens ” productivity im-
provement program. While both years included project charges,
these were higher in fiscal . In particular, the Energy
Sector’s Power Transmission Division took charges including
€  million related primarily to grid-connections to offshore
wind-farms and €  million related to onshore HVDC trans-
mission line projects.
Research and development (R & D) expenses decreased due
primarily to a reduction of €  million in the Infrastructure &
Cities Sector. This decrease was partly offset by increases of
€  million in the Energy Sector and €  million in the Health-
care Sector. R & D expenses as a percentage of revenue (R & D
intensity) decreased by one percentage point, to  % year-over
year. On an average basis, we employed , people in R & D
in fiscal , compared to , in fiscal . For additional
information see C.. RESEARCH AND DEVELOPMENT.
The improvement in Other operating income (expenses), net
resulted from an increase in other operating income of
€  million, only slightly offset by an increase of €  million in
other operating expenses. Within other operating income, pos-
itive effects included €  million from higher allocation of
central infrastructure and support services to Sectors and
Divisions outside Siemens AG, and gains totaling €  million
related to the sale of concessions and industrial property rights
to Siemens Schweiz AG.
The decline in Financial income, net was primarily attribut-
able to lower income from investments, which decreased by
€ . billion. Other financial income was €  million lower
compared to the prior year, while net interest income came in
€  million higher.
The primary factor for the decrease in income from invest-
ments was lower dividend payments. In fiscal , we received
a dividend payment of € . billion from Siemens Beteiligungs-
verwaltung GmbH & Co. OHG. We received no such dividend
payment in fiscal . In contrast, income from profit transfers
from Siemens Beteiligungen Inland GmbH increased by
€  million. In addition, gains (losses) from the disposal of
investments came in €  million higher year-over-year, in-
cluding a gain of €  million from the sale of our  % stake in
OSRAM Licht AG to Siemens Beteiligungen Inland GmbH.
The decrease in other financial income resulted mainly from a
realized loss related to interest and foreign currency derivatives
amounting to €  million, compared to income amounting to
€  million in the prior year. In addition, expenses from com-
pounding of pension provisions increased by €  million.
These factors were partly offset by reversals of impairments of
shares in investments of €  million.
The decline in Income tax expenses was due mainly to prior-
year one-time special effects.