Annual Report 2016

Notes to the Consolidated Financial Statements

1. Basic information and principles of the report

2. Changes in Group structure

3. Summary of significant accounting policies

4. Risk assessment and management

5. Management of capital

6. Trade accounts receivable

7. Other current assets and current financial assets

8. Inventories

9. Property, plant and equipment

10. Other non-current assets and non-current financial assets

11. Goodwill and intangible assets

12. Short-term debt

13. Other current liabilities and provisions

14. Long-term debt

15. Financial instruments

16. Retirement benefit plans

17. Participation plans

18. Deferred tax assets and liabilities

19. Other non-current liabilities and provisions

20. Contingencies

21. Capital stock and treasury shares

22. Earnings per share

23. Other operating expenses, net

24. Financial result, net

25. Income tax expenses

26. Operating Leasing

27. Research and development cost

28. Cashflow figures

29. Segment reporting

The Geberit Group consists of one single business unit, the purpose of which is to develop, produce and distribute sanitary products and systems for the residential and commercial construction industry. The major part of the products is distributed through the wholesale channel in general to plumbers, who resell the products to the end users. Products are produced by plants that specialise in particular production processes. As a general rule, one specific article is produced at only one location. Distribution is carried out by country or regional distribution subsidiaries, which sell to wholesalers. A distribution subsidiary is always res­ponsible for the distribution of the whole range of products in its sales area. The main task of the distribution subsidiary is local market development, which focuses mainly on the support of plumbers, sanitary planners and wholesalers. Research and development of the whole range of products is carried out centrally by Geberit International AG. All corporate tasks are also centralised at Geberit International AG.

Due to the unity and focus of the business, the top management (Group Executive Board) and the management structure of the Geberit Group are organised by function (Overall Management, Sales Europe, Sales International, Marketing & Brands, Operations, Product Management & Innovation, Finance). The financial management of the Group by the Board of Directors and the Group Executive Board is based on net sales by markets and product lines and on the consolidated income statements, balance sheets, and statements of cashflows.

Segment reporting is therefore prepared according to IFRS 8.31 et seq. (one single reportable segment) and the valuation is made according to the same principles as the consolidated financial statements. The geographical allocation of net sales is based on the domicile of the customers.

The information is as follows:

2016 2015
Net sales by product lines    
Installation Systems 789.9 724.1
Cisterns and Mechanisms 254.7 221.2
Faucets and Flushing Systems 123.4 117.9
Waste Fittings and Traps 95.5 82.7
Sanitary Systems 1,263.5 1,145.9
Building Drainage Systems 300.6 286.1
Supply Systems 523.2 512.7
Piping Systems 823.8 798.8
Bathroom Ceramics 561.5 478.1
Ceramics Complementary Products 160.2 170.9
Sanitary Ceramics 721.7 649.0
Total net sales 2,809.0 2,593.7

2016 2015
Net sales by markets    
Germany 861.0 798.2
Nordic Countries 306.3 253.3
Switzerland 281.0 275.7
Central/Eastern Europe 256.8 238.2
Benelux 219.0 195.8
Italy 185.9 172.6
France 170.8 153.1
Austria 147.3 129.8
United Kingdom/Ireland 123.2 126.1
Iberian Peninsula 18.8 17.3
Other markets 238.9 233.6
Total net sales 2,809.0 2,593.7

2016 2015
Share of net sales by customers    
Customers with more than 10% of net sales: customer A 403.3 376.2
Total > 10% 403.3 376.2
Remaining customers with less than 10% of net sales 2,405.7 2,217.5
Total net sales 2,809.0 2,593.7

2016 2015
Property, plant and equipment by markets    
Germany 250.0 232.8
Nordic Countries 36.0 43.7
Switzerland 161.7 169.3
Central/Eastern Europe 107.4 102.9
Benelux 4.9 3.4
Italy 48.5 45.3
France 10.2 10.7
Austria 39.6 38.0
United Kingdom/Ireland 2.3 1.7
Iberian Peninsula 11.7 11.2
Other markets 54.2 56.4
Total property, plant and equipment 726.5 715.4

30. Related party transactions

31. Foreign exchange rates

32. Subsequent events

33. Group companies as of December 31, 2016