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B. Summary of accounting policies

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General information

The accounting policies applied to the consolidated financial statements are consistent with those of the previous year with the exceptions listed below.

The following new and revised standards were adopted for the first time in the business year 2015/16:

The following new and revised standards and interpretations were adopted for the first time in the business year 2015/16

Standard

 

Content

 

Effective date1

 

 

 

 

 

IAS 19, amendments

 

Defined Benefit Plans: Employee Contributions

 

February 1, 2015

Various standards, amendments

 

Annual Improvements to International Financial Reporting Standards, 2010–2012 Cycle

 

February 1, 2015

Various standards, amendments

 

Annual Improvements to International Financial Reporting Standards, 2011–2013 Cycle

 

January 1, 2015

IFRIC 21

 

Levies

 

June 17, 2014

 

 

 

 

 

1
In accordance with EU endorsements, these standards are applicable to reporting periods beginning on or after the effective date.

There were no material effects of the mentioned standards on the consolidated financial statements.

The following three issues were adjusted retroactively in these consolidated financial statements according to IAS 8:

  • As a result of changes to the Austrian AFRAC Opinion “Auswirkungen der steuerlichen Teilwertabschreibung nach § 12 Abs. 3 Z 2 KStG auf die Bilanzierung von Ertragsteuern nach IAS 12 in einem Konzern- oder separaten Einzelabschluss nach IFRS” (Impact of the write-down to current value for tax purposes in accordance with Section 12 (3) (2) of the Austrian Corporation Tax Act (KStG) on accounting for income taxes in accordance with IAS 12 in consolidated or single entity financial statements in accordance with IFRS) no provisions have to be considered for anticipated write-ups.
  • In addition, deferred taxes are also netted for all companies per tax group.
  • Provisions were formed for the first time for obligations similar to pension payments for a South American subsidiary.

Change in the consolidated statement of financial position

04/01/2014 = 03/31/2014

 

Values without restatement

 

Adjustments

 

Values retroactively adjusted

 

 

 

 

 

 

 

Total assets

 

12,634.9

 

–100.9

 

12,534.0

thereof Deferred tax assets

 

312.4

 

–100.9

 

211.5

 

 

 

 

 

 

 

Total equity and liabilities

 

12,634.9

 

–100.9

 

12,534.0

thereof Equity

 

5,261.6

 

11.2

 

5,272.8

thereof Pensions and other employee obligations

 

1,015.3

 

14.0

 

1,029.3

thereof Deferred tax liabilities

 

187.5

 

–126.1

 

61.4

 

 

 

 

 

 

 

In millions of euros

Change in the consolidated statement of financial position

03/31/2015

 

Values without restatement

 

Adjustments

 

Values retroactively adjusted

 

 

 

 

 

 

 

Total assets

 

13,294.9

 

–90.2

 

13,204.7

thereof Deferred tax assets

 

328.9

 

–90.2

 

238.7

 

 

 

 

 

 

 

Total equity and liabilities

 

13,294.9

 

–90.2

 

13,204.7

thereof Equity

 

5,102.5

 

12.5

 

5,115.0

thereof Pensions and other employee obligations

 

1,252.2

 

15.1

 

1,267.3

thereof Deferred tax liabilities

 

180.9

 

–117.8

 

63.1

 

 

 

 

 

 

 

In millions of euros

Change in the consolidated statement of cash flows

2014/15

 

Values without restatement

 

Adjustments

 

Values retroactively adjusted

 

 

 

 

 

 

 

Operating activities

 

 

 

 

 

 

Profit after tax

 

594.2

 

0.8

 

595.0

Non-cash expenses and income

 

581.5

 

–0.8

 

580.7

Changes in working capital

 

–55.8

 

0.0

 

–55.8

 

 

 

 

 

 

 

Cash flows from operating activities

 

1,119.9

 

0.0

 

1,119.9

Cash flows from investing activities

 

–928.0

 

0.0

 

–928.0

Cash flows from financing activities

 

–289.6

 

0.0

 

–289.6

 

 

 

 

 

 

 

Net decrease/increase in cash and cash equivalents

 

–97.7

 

0.0

 

–97.7

Cash and cash equivalents, beginning of year

 

532.4

 

0.0

 

532.4

Net exchange differences

 

29.8

 

0.0

 

29.8

Cash and cash equivalents, end of year

 

464.5

 

0.0

 

464.5

 

 

 

 

 

 

 

In millions of euros

Change in the consolidated income statement

2014/15

 

Values without restatement

 

Adjustments

 

Values retroactively adjusted

 

 

 

 

 

 

 

Revenue

 

11,189.5

 

0.0

 

11,189.5

Cost of sales

 

–8,917.4

 

–0.1

 

–8,917.5

Gross profit

 

2,272.1

 

–0.1

 

2,272.0

 

 

 

 

 

 

 

Other operating income

 

454.4

 

0.0

 

454.4

Distribution costs

 

–975.4

 

–0.1

 

–975.5

Administrative expenses

 

–603.1

 

0.0

 

–603.1

Other operating expenses

 

–321.8

 

0.0

 

–321.8

Share of profit of entities consolidated according to the equity method

 

60.1

 

0.1

 

60.2

Profit from operations (EBIT)

 

886.3

 

–0.1

 

886.2

 

 

 

 

 

 

 

Finance income

 

44.0

 

0.0

 

44.0

Finance costs

 

–189.4

 

–1.8

 

–191.2

Profit before tax (EBT)

 

740.9

 

–1.9

 

739.0

 

 

 

 

 

 

 

Tax expense

 

–146.7

 

2.7

 

–144.0

Profit after tax

 

594.2

 

0.8

 

595.0

 

 

 

 

 

 

 

Attributable to:

 

 

 

 

 

 

Owners of the parent

 

548.3

 

0.8

 

549.1

Non-controlling interests

 

8.8

 

0.0

 

8.8

Share planned for hybrid capital owners

 

37.1

 

0.0

 

37.1

 

 

 

 

 

 

 

Basic and diluted earnings per share (euros)

 

3.181

 

0.0

 

3.18

 

 

 

 

 

 

 

1
A minor error in the allocation of profit to equity holders of the parent and owners of hybrid capital
that occurred in the previous year was adjusted. This meant that last year earnings per share (EPS)
were recorded amounting to EUR 3.11 instead of EUR 3.18.

In millions of euros

Change in the consolidated other comprehensive income

2014/15

 

Values without restatement

 

Adjustments

 

Values retroactively adjusted

 

 

 

 

 

 

 

Profit after tax

 

594.2

 

0.8

 

595.0

 

 

 

 

 

 

 

Items of other comprehensive income that will be reclassified to profit or loss

 

 

 

 

 

 

Cash flow hedges

 

22.4

 

0.0

 

22.4

Net investment hedges

 

10.3

 

0.0

 

10.3

Currency translation

 

127.4

 

1.2

 

128.6

Share of result of entities consolidated according to the equity method

 

9.8

 

0.0

 

9.8

Subtotal of items of other comprehensive income that will be reclassified to profit or loss

 

169.9

 

1.2

 

171.1

 

 

 

 

 

 

 

Items of other comprehensive income that will not be reclassified to profit or loss

 

 

 

 

 

 

Actuarial gains/losses

 

–184.2

 

–0.7

 

–184.9

Actuarial gains/losses of entities consolidated according to the equity method

 

–2.3

 

0.0

 

–2.3

Subtotal of items of other comprehensive income that will not be reclassified to profit or loss

 

–186.5

 

–0.7

 

–187.2

Other comprehensive income for the period, net of income tax

 

–16.6

 

0.5

 

–16.1

Total comprehensive income for the period

 

577.6

 

1.3

 

578.9

 

 

 

 

 

 

 

Attributable to:

 

 

 

 

 

 

Owners of the parent

 

527.8

 

1.3

 

529.1

Non-controlling interests

 

12.7

 

0.0

 

12.7

Share planned for hybrid capital owners

 

37.1

 

0.0

 

37.1

Total comprehensive income for the period

 

577.6

 

1.3

 

578.9

 

 

 

 

 

 

 

In millions of euros

The following standards are already published as of the reporting date, but their application was not yet mandatory for the business year 2015/16 or they have not been adopted by the European Union:

Published by IASB but not adopted by the European Union or their application was not yet mandatory as of the reporting date

Standard

 

Content

 

Effective date according to IASB1

 

 

 

 

 

IAS 1, amendments

 

Disclosure Initiative

 

January 1, 2016

IAS 16 and IAS 38, amendments

 

Clarification of Acceptable Methods of Depreciation and Amortization

 

January 1, 2016

IAS 16 and IAS 41, amendments

 

Agriculture: Bearer Plants

 

January 1, 2016

IAS 27, amendments

 

Equity Method in Separate Financial Statements

 

January 1, 2016

Various standards, amendments

 

Annual Improvements to International Financial Reporting Standards, 2012–2014 Cycle

 

January 1, 2016

IFRS 10, IFRS 12 and IAS 28, amendments

 

Investment Entities: Applying the Consolidation Exception

 

January 1, 20162

IFRS 11, amendments

 

Accounting for Acquisitions of Interests in Joint Operations

 

January 1, 2016

IAS 12, amendments

 

Recognition of Deferred Tax Assets for Unrealised Losses

 

January 1, 2017

IAS 7, amendments

 

Disclosure Initiative

 

January 1, 2017

IFRS 9

 

Financial Instruments

 

January 1, 2018

IFRS 15

 

Revenue from Contracts with Customers

 

January 1, 2018

IFRS 16

 

Leases

 

January 1, 2019

IFRS 10 and IAS 28, amendments

 

Sale or Contribution of Assets between an Investor and its Associate or Joint Venture

 

postponed

IFRS 14

 

Regulatory Deferral Accounts

 

January 1, 20163

 

 

 

 

 

1
These standards are applicable to reporting periods beginning on or after the effective date.
2
Has not yet been endorsed by the EU.
3
Not adopted by the EU.

These standards – in so far as they have been adopted by the European Union – are not being adopted early by the Group. From today’s perspective, material effects of the revised standards on the voestalpine Group’s financial situation and profitability are not expected. The following effects are expected from the new standards:

IFRS 9 Financial Instruments results in amendments and revisions in the area of financial instruments and will replace IAS 39 (except portfolio fair value hedge). Going forward, the classification rules vary according to the characteristics of the business model and the contractual cash flows of financial assets. Another fundamental innovation arises in connection with impairment, which in the future will be based on an expected loss model rather than, as has been the case, on incurred loss. In addition, IFRS 9 contains new general accounting requirements for hedge accounting. From the present vantage point, no significant effects are expected from the changes brought about by IFRS 9.

IFRS 15 Revenue from Contracts with Customers embraces the rules for revenue recognition and replaces IAS 18 and IAS 11 as well as the interpretations relating to revenues. In the future, it is no longer the conferring of significant opportunities and risks that is decisive but rather the point in time when the transfer of control over the goods and services occurs and thus the benefits to be derived through it. Currently, an analysis of the revenue groups is being conducted within the Group in order to evaluate the impact of the initial application of IFRS 15.

IFRS 16 Leases governs accounting for leasing arrangements and will replace IAS 17 as well as previous interpretations. The new rules eliminate the prior distinction between finance and operating leasing arrangements. In this respect, operating leases will in the future be treated in the same way as finance leases. The voestalpine Group companies currently operate as lessees in operating leases, which is why it can be expected that the application of IFRS 16 will have effects on assets and on financial and earning positions. However, it is not possible to quantify these effects at the moment – for a list of existing operating leases as of the reporting date, see chapter 9 Fixed Assets.

Basis of consolidation

Foreign currency translation

Uncertainties in accounting estimates and assumptions

Recognition of revenue and expenses

Property, plant and equipment

Leases

Goodwill

Other intangible assets

Impairment testing of goodwill, other intangible assets, and property, plant and equipment

Financial Instruments

Other investments

Income taxes

Inventories

Emission certificates

Trade and other receivables

Cash and cash equivalents

Pensions and other employee obligations

Other provisions

Contingent liabilities

Liabilities

Employee stock ownership plan

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About voestalpine

The voestalpine Group is a steel-based technology and capital goods group that operates worldwide. With its top-quality products, the Group is one of the leading partners to the automotive and consumer goods industries in Europe and to the oil and gas industries worldwide.

Facts

50 Countries on all 5 continents
500 Group companies and locations
48,500 Employees worldwide

Earnings FY 2015/16

€ 11.1 Billion

Revenue

€ 1.6 Billion

EBITDA

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