| Summary of Past Performance
| Key Figures
in EUR million
2011
2010
2009
2008
2007
2006
2005
Sales revenue
9,654
9,073
8,405
8,758
8,818
8,308
7,340
6
8
– 4
– 1
6
13
7
79
79
78
80
81
78
78
45.6
42.8
39.6
40.3
39.0
38.0
35.5
1,893
1,807
1,688
1,646
1,663
1,480
1,411
Capital expenditure on fixed assets**
453
403
294
382
378
358
333
As percentage of sales revenue
4.7
4.4
3.5
4.4
4.3
4.3
4.5
Depreciation, amortization and
impairment losses on fixed assets**
296
298
320
299
257
281
223
As percentage of capital expenditure
65
74
109
78
68
78
67
7,435
6,901
6,443
6,173
6,276
5,950
5,325
Year-to-year change in %
International sales revenue proportion (%)
Employees
(in thousands at 01.01. of the
following year)
Personnel expenses*
Balance sheet total
Fixed assets and non-current financial
assets
2,655
2,688
2,496
2,349
2,374
2,259
Group A nnual Repor t 2011
BSH Bosch und Siemens Hausgeräte GmbH (Group)
Group Annual Report 2011
Total Commitment. Top Performance.
1,957
in EUR million
2011
2010
Sales revenue
9,654
9,073
Year-to-year change in %
6
8
79
79
EBITDA *
943
1,052
EBIT *
647
754
Profit before tax
538
691
Consolidated net profit
373
465
Capital expenditure on fixed assets**
453
403
As percentage of sales revenue
4.7
4.4
Depreciation, amortization and impairment losses on fixed assets**
296
298
65
74
Balance sheet total
7,435
6,901
Equity
2,409
2,408
32
35
International sales revenue proportion (%)
1,305
1,226
1,032
1,074
1,103
1,019
828
Trade receivables from sales
of goods and services and other
current assets
2,691
2,199
1,954
2,031
2,053
2,052
1,655
Equity
2,409
2,408
2,535
2,396
2,372
2,057
1,859
32
35
39
39
38
35
35
As percentage of total equity and liabilities
Provisions
1,760
1,857
1,702
1,593
1,673
1,709
1,581
EBITDA*
943
1,052
905
867
949
868
768
EBIT*
647
754
585
568
692
587
542
Profit before tax
Consolidated net profit
538
373
691
465
517
324
510
311
637
411
542
372
500
386
*2005 – 2010 values after adjusting the reporting of interest expense and income from plan assets from pension, semi-retirement and long service bonus obligations.
See the Notes to the Consolidated Financial Statements for further explanations.
** Excluding goodwill.
B S H B O S C H U N D S I E M E N S H A U S G E R ÄT E G M B H
Inventories
As percentage of capital investment
As percentage of total equity and liabilities
*2010 values after adjusting the reporting of interest expenditure and income from plan assets from pension, semi-retirement and long service
bonus obligations. See the Notes to the Consolidated Financial Statements for further explanations.
** Excluding goodwill.
B S H B O S C H U N D S I E M E N S H A U S G E R ÄT E G M B H
| Summary of Past Performance
| Key Figures
in EUR million
2011
2010
2009
2008
2007
2006
2005
Sales revenue
9,654
9,073
8,405
8,758
8,818
8,308
7,340
6
8
– 4
– 1
6
13
7
79
79
78
80
81
78
78
45.6
42.8
39.6
40.3
39.0
38.0
35.5
1,893
1,807
1,688
1,646
1,663
1,480
1,411
Capital expenditure on fixed assets**
453
403
294
382
378
358
333
As percentage of sales revenue
4.7
4.4
3.5
4.4
4.3
4.3
4.5
Depreciation, amortization and
impairment losses on fixed assets**
296
298
320
299
257
281
223
As percentage of capital expenditure
65
74
109
78
68
78
67
7,435
6,901
6,443
6,173
6,276
5,950
5,325
Year-to-year change in %
International sales revenue proportion (%)
Employees
(in thousands at 01.01. of the
following year)
Personnel expenses*
Balance sheet total
Fixed assets and non-current financial
assets
2,655
2,688
2,496
2,349
2,374
2,259
Group A nnual Repor t 2011
BSH Bosch und Siemens Hausgeräte GmbH (Group)
Group Annual Report 2011
Total Commitment. Top Performance.
1,957
in EUR million
2011
2010
Sales revenue
9,654
9,073
Year-to-year change in %
6
8
79
79
EBITDA *
943
1,052
EBIT *
647
754
Profit before tax
538
691
Consolidated net profit
373
465
Capital expenditure on fixed assets**
453
403
As percentage of sales revenue
4.7
4.4
Depreciation, amortization and impairment losses on fixed assets**
296
298
65
74
Balance sheet total
7,435
6,901
Equity
2,409
2,408
32
35
International sales revenue proportion (%)
1,305
1,226
1,032
1,074
1,103
1,019
828
Trade receivables from sales
of goods and services and other
current assets
2,691
2,199
1,954
2,031
2,053
2,052
1,655
Equity
2,409
2,408
2,535
2,396
2,372
2,057
1,859
32
35
39
39
38
35
35
As percentage of total equity and liabilities
Provisions
1,760
1,857
1,702
1,593
1,673
1,709
1,581
EBITDA*
943
1,052
905
867
949
868
768
EBIT*
647
754
585
568
692
587
542
Profit before tax
Consolidated net profit
538
373
691
465
517
324
510
311
637
411
542
372
500
386
*2005 – 2010 values after adjusting the reporting of interest expense and income from plan assets from pension, semi-retirement and long service bonus obligations.
See the Notes to the Consolidated Financial Statements for further explanations.
** Excluding goodwill.
B S H B O S C H U N D S I E M E N S H A U S G E R ÄT E G M B H
Inventories
As percentage of capital investment
As percentage of total equity and liabilities
*2010 values after adjusting the reporting of interest expenditure and income from plan assets from pension, semi-retirement and long service
bonus obligations. See the Notes to the Consolidated Financial Statements for further explanations.
** Excluding goodwill.
B S H B O S C H U N D S I E M E N S H A U S G E R ÄT E G M B H
BSH Bosch und Siemens Hausgeräte GmbH
BSH Bosch und Siemens Hausgeräte GmbH
was founded in 1967 as a joint venture between Robert Bosch GmbH, Stuttgart, and Siemens AG, Berlin/Munich. The company is now
the third-largest home appliances manufacturer worldwide, and number one in Europe,
with sales of EUR 9.654 billion in 2011.
The Group’s product portfolio spans the
entire spectrum of modern domestic appliances. It ranges from stoves, ovens and
extractor hoods to dishwashers, washers and
dryers, fridges and freezers to small appliances (Consumer Products) such as vacuum
cleaners, coffee machines, kettles, irons and
hairdryers.
On December 31, 2011 the Munich-based
group had 42 factories across Europe, Asia
llflächeninduktions-Kochfeld CX 480.
and North America as well as a global network of sales and customer service outlets
in almost 50 countries. BSH employed over
45,600 people in 2011, with over 70 percent
of these in Europe.
In spring 2012, BSH was ranked as a top
employer in Germany by the CRF Institute
in the sixth consecutive year; the company
also achieved this top accolade for the first
time in Poland and the Netherlands. BSH was
awarded first place in the innovation management category of the top employer ranking for
engineers.
Main Brands
Special Brands
Regional Brands
Bosch and Siemens: these two
brands are known worldwide and
have a long history, underpinning
our international success. Bosch
stands for reliable, durable products; Siemens stands for innovation, leading-edge technology and
quality design.
The BSH brand portfolio includes
the special brands Gaggenau
and Neff, Thermador, Constructa,
Viva, Ufesa and Junker. These
ensure we meet the wide-ranging
requirements of our various customers.
Regional brands are the market
leaders which garner respect in
their countries of origin. Brands
with which our regional consumers
particularly identify include Balay
in Spain, Pitsos in Greece, Profilo
in Turkey and Coldex in Peru. Such
brands help strengthen BSH’s
position in these countries.
| BSH Worldwide
• Helsinki
Oslo •
Environmental and climate protection have
always been firmly anchored in the Group‘s
corporate strategy. BSH’s energy- and watersaving household appliances contribute to
the efficient use of resources. We have listed
our most efficient appliances in a Super Efficiency Portfolio since 2009. BSH has also
set itself a 2015 target to reduce resource use
in manufacturing and administration by 25
percent.
• St. Petersburg
• Stockholm
• Moscow
• Ballerup
TM
TM
• Toronto
Irvine
 New Bern
•
La Follette 
Casablanca •
• Tel Aviv
• Dubai
• Jeddah
• Mumbai
• Mexico City
Chuzhou 
• Seoul
• Nanjing
 Wuxi
Milton Keynes •
• Hong Kong
 Kabinburi
• Bangkok
• Amsterdam
Nauen 
Brussels •
 Berlin
• Warsaw
 Lódź
• Kiev
Bad Neustadt 
• Prague
Luxembourg •
 Bretten
• Michalovce
Giengen  • Regensburg
Paris •
Munich
Lipsheim Dillingen  
 Traunreut• Vienna• Budapest
Geroldswil •
• Kuala Lumpur
• Singapore
 Lima
• Nazarje
• São Paulo
Buenos Aires • • Montevideo
Milan •
• Johannesburg
Melbourne •
Auckland •
Santander 
Vitoria  • Huarte
Estella   Esquiroz
Zaragoza •  La Cartuja
 Montañana
• Bucharest
Çerkezköy  • Istanbul
• Lisbon
• Athens
Flexibilität und Freizügigkeit. Mit dem Vollflächeninduktions-Kochfeld CX 480 von Gaggenau ist erstmals die gesamte
Kochzone nutzbar. Das Kochgeschirr wird automatisch erkannt und dort erhitzt, wo es gerade steht.
Group Headquarters
• Subsidiaries
Factories:
 Cooking
 Refrigeration/Freezing
 Dishwashing
 Washing/Drying
 Consumer Products
 Motors, pumps
BSH Bosch und Siemens Hausgeräte GmbH
BSH Bosch und Siemens Hausgeräte GmbH
was founded in 1967 as a joint venture between Robert Bosch GmbH, Stuttgart, and Siemens AG, Berlin/Munich. The company is now
the third-largest home appliances manufacturer worldwide, and number one in Europe,
with sales of EUR 9.654 billion in 2011.
The Group’s product portfolio spans the
entire spectrum of modern domestic appliances. It ranges from stoves, ovens and
extractor hoods to dishwashers, washers and
dryers, fridges and freezers to small appliances (Consumer Products) such as vacuum
cleaners, coffee machines, kettles, irons and
hairdryers.
On December 31, 2011 the Munich-based
group had 42 factories across Europe, Asia
llflächeninduktions-Kochfeld CX 480.
and North America as well as a global network of sales and customer service outlets
in almost 50 countries. BSH employed over
45,600 people in 2011, with over 70 percent
of these in Europe.
In spring 2012, BSH was ranked as a top
employer in Germany by the CRF Institute
in the sixth consecutive year; the company
also achieved this top accolade for the first
time in Poland and the Netherlands. BSH was
awarded first place in the innovation management category of the top employer ranking for
engineers.
Main Brands
Special Brands
Regional Brands
Bosch and Siemens: these two
brands are known worldwide and
have a long history, underpinning
our international success. Bosch
stands for reliable, durable products; Siemens stands for innovation, leading-edge technology and
quality design.
The BSH brand portfolio includes
the special brands Gaggenau
and Neff, Thermador, Constructa,
Viva, Ufesa and Junker. These
ensure we meet the wide-ranging
requirements of our various customers.
Regional brands are the market
leaders which garner respect in
their countries of origin. Brands
with which our regional consumers
particularly identify include Balay
in Spain, Pitsos in Greece, Profilo
in Turkey and Coldex in Peru. Such
brands help strengthen BSH’s
position in these countries.
| BSH Worldwide
• Helsinki
Oslo •
Environmental and climate protection have
always been firmly anchored in the Group‘s
corporate strategy. BSH’s energy- and watersaving household appliances contribute to
the efficient use of resources. We have listed
our most efficient appliances in a Super Efficiency Portfolio since 2009. BSH has also
set itself a 2015 target to reduce resource use
in manufacturing and administration by 25
percent.
• St. Petersburg
• Stockholm
• Moscow
• Ballerup
TM
TM
• Toronto
Irvine
 New Bern
•
La Follette 
Casablanca •
• Tel Aviv
• Dubai
• Jeddah
• Mumbai
• Mexico City
Chuzhou 
• Seoul
• Nanjing
 Wuxi
Milton Keynes •
• Hong Kong
 Kabinburi
• Bangkok
• Amsterdam
Nauen 
Brussels •
 Berlin
• Warsaw
 Lódź
• Kiev
Bad Neustadt 
• Prague
Luxembourg •
 Bretten
• Michalovce
Giengen  • Regensburg
Paris •
Munich
Lipsheim Dillingen  
 Traunreut• Vienna• Budapest
Geroldswil •
• Kuala Lumpur
• Singapore
 Lima
• Nazarje
• São Paulo
Buenos Aires • • Montevideo
Milan •
• Johannesburg
Melbourne •
Auckland •
Santander 
Vitoria  • Huarte
Estella   Esquiroz
Zaragoza •  La Cartuja
 Montañana
• Bucharest
Çerkezköy  • Istanbul
• Lisbon
• Athens
Flexibilität und Freizügigkeit. Mit dem Vollflächeninduktions-Kochfeld CX 480 von Gaggenau ist erstmals die gesamte
Kochzone nutzbar. Das Kochgeschirr wird automatisch erkannt und dort erhitzt, wo es gerade steht.
Group Headquarters
• Subsidiaries
Factories:
 Cooking
 Refrigeration/Freezing
 Dishwashing
 Washing/Drying
 Consumer Products
 Motors, pumps
118
Total Commitment. Top Performance. With Responsibility.
Excellent, committed employees are what characterizes BSH Bosch
und Siemens Hausgeräte GmbH, today more than ever. They are the
power behind the strong performance of our products and solutions
and therefore form the foundation for our economic success. It is one
of our fundamental principles, which we have internalized, that every­thing we do must demonstrate our commitment to society and the
environment. Our Annual and Sustainability Reports will show how
economic success and responsible action are mutually interdependent.
Both reports are available as pdf versions on the Internet at:
www.bsh-group.com
| B S H st a y s th e c o u r s e
In what was a difficult financial year, BSH once again managed to exceed its
The latest Sustainability Report will be available from mid-June 2012.
revenue expectations and generate positive earnings. This confirms that we
have embarked on the right path. Thanks to the development of attractive
home appliances that deliver top performance with low energy consumption,
we can stay on track even in turbulent times.
BSH Bosch und Siemens Hausgeräte GmbH
Carl-Wery-Strasse 34, 81739 Munich, Germany
Tel. +49 89 4590-01
Fax +49 89 4590-2347
www.bsh-group.com
Media contact:
Corporate Communications
Tel. +49 89 4590-2809
Fax +49 89 4590-2128
corporate.communications@bshg.com
The Annual Report and the following further publications
are available in German and English:
• Sustainability Report 2011
• Our Super Efficiency Portfolio 2011
• BSH at a Glance 2012
This report was printed climate neutrally on FSC-certified
Hello Silk paper.
Right of amendment reserved, errors excepted.
Printed in Germany. May 2012.
© BSH Bosch und Siemens Hausgeräte GmbH.
Reproduction and use in all media, whether complete or in
part, subject to approval.
2
I N D E P E N D E N T A U D I T O R S ’ R E P O R T | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
| Contents
| Independent Auditors’ Report
We have audited the consolidated financial statements prepared by BSH Bosch und Siemens
Hausgeräte GmbH, Munich, comprising the balance sheet, the income statement and statement of comprehensive income, the cash flow statement, the statement of changes in equity
and the notes to the consolidated financial statements, and management report for the business year from January 1 to December 31, 2011. The preparation of the consolidated financial
statements and group management report according to the International Financial Reporting
Standards (IFRS), as adopted by the European Union (EU), and the additional requirements of
German commercial law pursuant to § 315a (1) HGB (German Commercial Code) are the responsibility of the parent company’s management. Our responsibility is to express an opinion
on the consolidated financial statements and on the group management report based on our
audit.
8
12
4| Foreword
8|
The Art of Coffee
At the BSH plant in Traunreut, Bavaria, Andreas Liebl and his team
busy themselves perfecting the technology to create expert espresso,
with an optimum crema on top. With the passion of an Italian barista,
the team strive to get the best aroma from their beans.
12| Cultural Program
At the BSH Technology Center for Laundry Care in Berlin, Kathrin
Redlin creates washing cycles for a globalized world. Because laundry
habits vary from culture to culture.
16| Follow the Trail
At BSH in Bad Neustadt, Bavaria, Roland Illig and his team are on the
trail of lost energy in the Floor Care Development Center. Their detective work has uncovered a particularly efficient vacuum cleaner.
20| Globetrotters
Across China by freight train: Christoph Rohr knows the stresses BSH appliances must endure. He uses his understanding to develop the ideal packaging.
24| A Source of Inspiration
At the BSH site in Hoofddorp, near Amsterdam, Ronald Wassenaar re­
volutionizes the kitchen-planning process. He and his team of advisors
cater to customers’ individual wishes so they find the appliances that
best fit their desires. Afterwards they plan the rest of the kitchen.
We conducted our audit of the consolidated financial statements in accordance with § 317 HGB
and German generally accepted standards for the audit of financial statements promulgated
by the Institut der Wirtschaftsprüfer (Institute of Public Auditors in Germany). Those standards
require that we plan and perform the audit such that misstatements materially affecting the
presentation of the net assets, financial position, and results of operations in the consolidated
financial statements in accordance with the applicable financial reporting framework and
in the group management report are detected with reasonable assurance. Knowledge of the
business activities and the economic and legal environment of the Group and expectations
as to possible misstatements are taken into account in the determination of audit procedures.
The effectiveness of the accounting-related internal control system and the evidence supporting the disclosures in the consolidated financial statements and the group management
report
are examined primarily on a test basis within the framework of the audit. The audit includes
assessing the annual financial statements of those entities included in consolidation, the determination of entities to be included in consolidation, the accounting and consolidation principles used, and significant estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements and the group management report. We
believe that our audit provides a reasonable basis for our opinion.
Our audit has not led to any reservations.
In our opinion, based on the findings of our audit, the consolidated financial statements of
BSH Bosch und Siemens Hausgeräte GmbH, Munich, comply with IFRS, as adopted by the EU,
the additional requirements of German commercial law pursuant to § 315a (1) HGB and give
a true and fair view of the net assets, financial position and results of operations of the group
in accordance with these requirements. The group management report is consistent with the
consolidated financial statements and as a whole provides a suitable view of the group’s position and suitably presents the opportunities and risks of future development.
Munich, April 5, 2012
Deloitte & Touche GmbH
Wirtschaftsprüfungsgesellschaft
(Prof. Dr. Plendl) Wirtschaftsprüfer (German Public Auditor)
(Prosig)
Wirtschaftsprüfer
(German Public Auditor)
117
| CONT ENT S
16
28| Essay
Energy efficiency is the key to
implementing the energy transition
in Germany.
By Dr. Kurt-Ludwig Gutberlet,
Chairman of the Board of Management
20
24
33| Supervisory Board Report
72 | Notes to the Consolidated Financial Statements
72 Accounting Policies
82 Notes to the Consolidated Statement of Income
87 Notes to the Balance Sheet
112 Consolidated Statement of Changes in Fixed Assets
35| Board of Management,
Supervisory Board
116| Shareholdings of BSH Bosch
und Siemens Hausgeräte GmbH
36| Group Management Report
37 Development of Business
53 Net Assets, Financial Position and Results of Operations
59 Management of Opportunities
and Risks
63Outlook
117| Independent Auditors’ Report
65| Consolidated Financial Statements
66 Consolidated Statement of Income
67 Consolidated Statement of
Comprehensive Income
68 Consolidated Balance Sheet
70 Consolidated Statement of Cash Flows
71 Consolidated Statement of Changes in Shareholders’ Equity
118| Imprint
| BSH Worldwide
| Summary of Past Performance
3
4
The BSH Board of Management:
(from left to right)
Jean Dufour, Winfried Seitz,
Johannes Närger
and Dr. Kurt-Ludwig Gutberlet
| FOREWORD
BSH Stays the Course
Fiscal 2011 was no easy year for the global economy. Although recovery from the global
financial crisis initially continued, the second half of the year was increasingly affected by the
EU debt crisis. The economic difficulties, which led to declines in demand in several traditional
markets in Western Europe, were exacerbated by turbulences in the foreign exchange markets,
which cannot remain without consequences for a globally operating company like BSH.
Despite this difficult economic environment, BSH succeeded in exceeding its revenue expec­
tations with a year-on-year increase of more than six percent in group sales to 9.654 billion
euros. This positive development was attributable, among other things, to our home market.
The German economy enjoyed growth despite the deteriorating debt crisis in Europe, and we
were able to benefit more than most from this development. The market for home appliances
in Germany has shown encouragingly robust growth, and we have been able to consolidate
our domestic position even further. Thanks to strong figures for built-in appliances and the
increasing demand for energy-efficient models, BSH has been able to post an eight percent
rise in sales. As a result, our sales in Germany crossed the two-billion euro mark for the first
time in our company’s history.
This confirms that we have embarked on the right path. BSH has already been investing for
decades in the development and optimization of home appliances that combine maximum
convenience and attractive product design with especially low resource consumption. This
strategy requires a lot of stamina, which we indeed have, thanks to our ownership structure.
The rising demand for our products proofs that we offer the right answers to counter mounting
competition from manufacturers. By deciding to buy our products, consumers express their
appreciation of the inventive spirit and persistence of our developers. In light of the international pioneering role that Germany wants to play in the transition to renewable energies, this
trend fills us with confidence, also with regard to our growth oppor­tunities in other mature
markets.
However, the main growth drivers for BSH are outside of Germany. As in previous years, our
business development in particular in Turkey and Russia was especially dynamic. Although
these successes were diminished somewhat by negative exchange rate effects, we nevertheless posted a growth rate of 15.5 percent to over 1.8 billion euros in these Eastern European
countries. In China, our sales rose by 20 percent despite a slowdown in the economic growth.
Our business also developed very positively in the rest of Asia as well as in Australia and
Oceania. We did, however, suffer declines in some Western European markets and in the U.S.
While sales revenue in Western Europe fell slightly, due primarily to the effects of the debt
crisis, the revenue decline in the U.S. was caused predominantly by our exit from the 27-inch
segment in laundry care and the development of the U.S. dollar.
Overall, BSH once again managed to generate an encouraging consolidated net profit of 373
million euros in this volatile environment in the year under review. To maintain and strengthen
our position among the world’s leading home appliance manufacturers, we not only invested
5
6
just under 300 million euros in research and development in the year under review, but also
453 million euros in new products, new production plants and in extending capacity at existing
factories in Germany and abroad. True to our sustainable growth strategy, we paid strict
attention to maintaining a sound financial position with low third-party indebtedness in these
endeavors. Our solid financials and positive outlook were also recognized by international
rating agency Standard & Poor’s, which confirmed our good credit rating and our outstanding
creditworthiness.
Our stable profitability, a strong competitive position, the development lead in energy-efficient
appliances, a global market and manufacturing presence, and the sound financial position
give us the certainty that BSH will also be able to stay on track in the future, and not just under
“fair weather” conditions. For fiscal 2012, we expect at best a stagnating market in Western
Europe, with the exception of Germany, where we forecast a slight increase. Growth rates in
China of, in part, more than 20 percent are most likely to be a thing of the past, and growth in
Eastern Europe is expected to be slightly below the figure for the previous year.
Business per­formance over the first few months of 2012 confirms that we face increasingly
difficult market development. Despite this fact, we aim at continuing to increase our sales
revenue in 2012.
Dr. Kurt-Ludwig Gutberlet Jean Dufour
Johannes Närger
Winfried Seitz
| T otal C ommitment
Comprehensive service, intelligent solutions for transport and
logistics, technical perfection and the continuous optimization of
our product portfolio. Our employees at all our sites put in
every effort possible so that BSH can continue in future as a
leading manufacturer of home appliances to generate added value
for its customers and shareholders.
8
| the art of coffee
Good coffee at the press of a button, quality without compromise,
product intelligence for the best result. Inner values that often comprise
decades of intensive development work. Despite all their knowledge
of electronics, mechanics and thermodynamics, Andreas Liebl and
his fellow employees at the Traunreut development center never forget
what matters most: getting the best flavor from roasted coffee beans.
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10
Smell, taste and touch –
to sharpen their senses,
Andreas Liebl (fourth
from the left) and his
fellow developers
regularly test various
kinds of coffee. After all,
only someone with the
passion of a barista can
develop machines that
turn out excellent coffee
every time.
With the Fiery Enthusiasm
of an Italian Barista
“That‘s it. That‘s what the perfect ‘crema’
looks like,” says Andreas Liebl while using
his spoon to draw a half-moon in the golden
brown layer of the espresso in front of him.
He raises the spoon, and the countless mini­scule bubbles in the espresso cup immediately form a closed surface again. “That’s
what makes the difference in turning an
ordinary espresso into a superb one. And,
after all, enjoyment is what we want to give
to the customer.”
This kind of commitment is what drives Liebl
and his team of 100 coffee machine experts
every day. BSH is one of the few manufacturers in the world that develop and produce the
large part of the coffee machines’ important
components in-house, like the brewing unit,
the grinding gear, the engine or the electronics assembly.
The team of developers is just as diverse as
the product portfolio: engineers next to mechatronics specialists and young guns next to old
hands. Together they make sure that their
machines produce coffee with superb flavor
and aroma. Their benchmark is the professional barista – the enthusiastic coffee artisan
who fulfills every customer‘s wishes with
style, elegance and, most of all, precision.
It takes only a few seconds for a modern
coffee machine to turn beans and water into
the perfect cup of coffee – whether it‘s a
full-bodied espresso, a perfectly layered latte
macchiato, or a cappuccino with creamy milk
foam that sticks to the spoon. To make sure
that the result tastes as good as it does in the
bistros of Rome, Milan or Naples, even the
smallest detail has to be just right: How does
the ceramic grinder produce the perfect
balance of coarsely and finely ground coffee
beans? How can the machine build up the
perfect water pressure? And how can it vary
the water temperature by the second in order
to extract the most flavor from each bean?
“We test until everything fits together perfectly,” says Liebl, “because we want our cus­
tomers to get the perfect cup of coffee every
time they use the machine.”
Creating the Perfect Taste is a Matter of
Technique
Albert Ostermaier is one of the truly old
hands at BSH. For 37 years he has been developing coffee machines for BSH. Today he is
a specialist for the brewing unit. Brewing unit
is a plain term for a highly complex component that takes care of lots of things: it holds
back unwanted tannins and lets only the
typical coffee flavors pass through. Ostermaier checks each individual part in the lab
with a constant focus on what matters most:
| T HE ART OF COF F EE
the ­coffee’s taste. And whenever the seasoned engineer looks at the perfect goldenbrown ‘crema’, he still feels elated.
Engineers Give a Bean for Coffee Beans
These days, a sophisticated espresso
machine has over 500 parts. It houses pre­cisely adjusted sensors, microchips and
circuit boards. The interior is similar to a
high-performance computer. The interaction
of mechanical and electronic components
is becoming increasingly complex. “The
machine knows when the bean container is
empty, when it needs water or when parts
need cleaning,” explains developer Joachim
Knauer. That’s why the team comprises more
and more trained mechatronics technicians
who know their way around moving parts and
their controls. Engineers and mechatronics
technicians also take part in regular tasting
seminars. After all, they want to develop
products that coffee lovers will be eager to
purchase.
And since the whole process of preparing
excellent coffee should be as easy as poss­
ible, new machines froth the milk and brew
the coffee in a single step. Their design has
also been improved, so that cups and glasses
of any size now fit underneath the spout. And
the machines are so intuitive to use that press­ing a single button is usually all it takes.
Small details, but together they make a huge
difference.
Maximum convenience is also a major selling
point for the latest models in the Tassimo
line of hot beverage systems. The machines
use special pods called T Discs for many
different kinds of beverages, including tea
and hot chocolate, from many well-known
brands. With Tassimo, BSH provides the
tailor-made answer to changing lifestyles:
“More and more people want to enjoy
coffee in different variations at home,”
says Dr. Stephan Straub, who heads the
department in which Tassimo products
are developed.
A Barcode that Says It All
The small, intelligent beverage systems are
very popular. Since BSH hit the market in
2008, the sales volume has doubled to two
million machines. Its unique feature is the
barcode on each T Disc, which tells the
machine instantly which program it needs to
run to turn its contents into aromatic tea,
flavorful coffee or tasty hot chocolate. The
barcode determines the proper temperature
curve and the correct amount of water.
Needless to say, the espresso T Disc also
delivers the perfect ‘crema’ every time – the
team in Traunreut wouldn’t be satisfied with
anything less.
Left: Albert Ostermaier
makes sure that the
coffee develops its full
aroma. With the brewing
unit he extracts the
coffee’s aroma and
ensures the perfect flavor.
Right: Dr. Stephan Straub
and his team develop
Tassimo multi-beverage
machines, which prepare
coffee, tea and cocoa.
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| C ultural P rogram
Action, easy going or turbo – Kathrin Redlin designs a wide variety
of programs for a global audience. Not for radio or television, but
for washing machines. With her software she makes sure that the
machines best meet the needs of the various international markets.
The right temperature or spin speed depends not only on the properties
of the fabrics being washed, but primarily on what is customary in
different cultures.
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14
Dr. Andreas Hanau and
Kathrin Redlin check the
laundry’s cleanliness.
Although laundry habits
differ greatly around the
world, there’s one thing
that customers want
most of all: really clean
laundry.
Sophisticated Technologies for Today’s
Markets
BSH’s new Technology Center for Laundry
Care in Berlin is a modern, futuristic-looking
building with a bright and shiny exterior.
Here, 700 employees, half of them engineers
or technicians, develop the washers and
dryers of the future. They provide answers
for global and regional laundry trends.
Nothing on a new washing machine is left
to chance – neither the number or names
of the program cycles nor the size or looks
of the exterior. And certainly not the sound
the machine makes in the spin cycle.
Kathrin Redlin is one of the creative minds in
this facility. She develops the various programs that consumers can select by pressing
a button or turning a rotary knob. Her résumé
could not fit better: She started out as a dress­maker, learning everything there is to know
about fabrics and how to handle them. She
then learned programming as a data pro­cessing specialist, and finally she completed
a course of studies in clothing engineering.
Redlin knows exactly how fabrics respond to
different temperatures, water quantities and
cycle lengths. She also knows how certain
laundry customs come about. “We absorb a
lot from our parents,” she explains. In the
USA, for example, people like to wash their
clothes frequently, and often in cold water
and in short cycles. Greeks, on the other
hand, appreciate the cycle with extra-hot
water. In India, “hand wash” does not mean
gentle cleaning, but rather the thorough
kneading and beating of heavily soiled
clothes. Only nine percent of Germans use the
pre-wash cycle, but virtually no one would
purchase a machine without this option.
Whether hot or cold, short or long – at the end
of the day, everyone wants their laundry to
come out perfectly clean. The developers at
BSH know that the top purchasing criterion for
a washing machine is cleaning performance.
Regional Challenges
Since BSH sells its products all over the
world, Redlin also concerns herself with
traditional clothing from other cultures.
Currently her focus is on saris, the colorful
wraps often made from artfully woven silk
which are worn by Indian women. “The goal is
to wash the long fabric bands in such a way
that they don’t come out the machine in one
huge knot,” explains the 43-year-old.
In 2012 BSH starts erecting a factory for
washing machines in India, the engineers
need to master many challenges for the
Indian market: power failures, strongly
fluctuating water line pressures or power
plugs that are shaped differently in almost
every region must not impair the washing
performance.
| C U LT U R A L P R O G R A M
“The trick is to come up with the easiest
possible answers to a wide range of requirements,” explains engineer Dr. Andreas
Hanau. That’s why BSH develops appliances
that share the same basic structure and adds
details for regional customization. One such
example is Russia, where customers prefer
machines that are not as deep as those in
most other countries, because space is at a
premium in their often tight apartments. In
response, the developers are designing a
kind of washing machine kit that comprises
housing and drum components with different
depths. To build deeper models, they simply
use longer components for the housing and
the drum than for the more space-saving
models. Customers get what they want, and
the efficient building block kit saves time,
material and money in terms of development
and production.
The Kit Principle
The developers are also working hard to turn
out washing machines that produce the perfect sound, ranging from their normal operating noise to their acoustic signals. In China,
for example, the machines are often located
in living rooms and run predominantly in the
evening hours, when electricity rates are lower.
Since this is also the time when the family
sits at the dinner table, Chinese customers
prefer machines that are especially quiet.
The path to a pleasant-sounding wash cycle
leads through Wolfang Harbich’s sound lab, a
well-insulated acoustic chamber that sits on
springs in order to eliminate any interfering
noise which might intrude from the outside.
Here the washing machines sit in front of
microphones, just like vocalists. “The spin
cycle should never make a low, rumbling
sound,” says Harbich. If a sound is perceived
as displeasing, the user might think that the
machine is malfunctioning – that’s why we
are working so hard on designing perfect
machine sounds.”
Sound Tells the Story
When it comes to developing new washers
and dryers, sound provides important information about hidden weak spots. For example, Harbich has already been able to improve
machine housings and motors with his work.
Among his tools is even an acoustic camera,
which converts sounds into images that are
similar to those produced by heat-sensing
cameras. They make every rattle and buzz
visible and – most importantly – pinpoint
their location so that technicians can figure
out their cause.
Whether the focus is on sound, volume,
special wash programs or the pre-wash cycle:
the BSH developers optimize washing
machines to meet the needs of customers in
all of the world’s regions and cultures.
Left: At the Technology
Center for Laundry Care
in Berlin, around 700
employees have been
developing the washers
and dryers of the future
since 2011.
Right: The washing
machine as a recording
star. Wolfgang Harbich
ensures not only that
the prototype makes a
pleasant sound – its
acoustic emissions can
also help detect even the
most subtle potential for
improvement.
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| follow the trail
In just a few years, Roland Illig and his team of developers at the BSH
site in Bad Neustadt have managed to significantly reduce the power
consumption of vacuum cleaners. While the discussion with regard to
an EU energy label for vacuum cleaners is still ongoing, BSH is already
developing particularly efficient models. With innovative nozzles,
optimized interior air flow and new dust bags, the most energy-efficient
Siemens model draws only 850 watts for strong cleaning performance.
Whether it is our vacuum cleaners or our Super Efficiency Portfolio of
appliances that already carry an EU label: in terms of energy efficiency,
performance and convenience we deliver far more than we have to.
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Here are the winners:
Two vacuum cleaners
developed by Roland Illig
and his team were ranked
in first place by Stiftung
Warentest, Germany’s
independent consumer
product testing orga­ni­z­
ation in 2011 (issue 4/11).
The organization praised,
among other things, the
appliances’ low power
consumption – the result
of sophisticated air
stream design.
Reclaiming Lost Energy
The corpus delicti measures a mere few
micrometers, comes in various colors and
shapes and originates in birch forests,
exhaust pipes or even sand storms: the dust
particle. It takes a lot more than a magnifying
glass to track it down, which is why it became
a prime piece of evidence in the search for
lost energy.
Day after day, millions of people use vacuum
cleaners that consume a lot more energy than
they have to. Of the up to 2,000 watts which
older models draw from the power grid, only
one-fifth is used for the actual cleaning task
in many cases. The team of 55 developers at
the BSH site in Bad Neustadt decided to do
something about this glaring inefficiency by
using innovative detection methods to look
for all this lost energy. Their air flow facility is
their forensics lab, and their measuring probe
is their magnifying glass.
“To find out what happens inside the vacuum
cleaner, the flow engineers took a close look
at the path taken by each dust grain,” ex­plains Roland Illig, head of floor care development at BSH. What they found out is that a
large portion of the energy is simply lost in
turbulence. Each air stream also creates little
vortexes at its edges, and vacuum cleaners
are unfortunately no exception. “These vor-
texes cause grains of dust to swirl around
unnecessarily,” explains Illig. Making sure
that they ultimately wind up in the dust bag
takes extra energy, which turns vacuuming
into an activity that wastes more electricity
than it should. “Our goal is therefore to
make sure that each dust grain arrives at its
destination without vortex detours,” says Illig.
Power Drains: Air Vortexes in Action
Fluid mechanics allows engineers to precisely
predict the flow of materials in enclosed
systems. The path taken by a grain of dust is
no exception. To compute the air flow within a
vacuum cleaner hose, for example, a specialist needs only pen and paper – the calculation is relatively easy. With irregularly shaped
components like the floor nozzle, things
become a lot more difficult. To optimize the
route taken by a dust particle in such parts,
developers employ computer programs to
compute the complex air flow and map it
three-dimensionally. Based on the results of
this detailed search, the developers are able
to design vacuum cleaners that generate
almost no vortexes in their interior.
Thoroughly optimized floor nozzles aren’t the
only thing that makes sure that energy-efficient models deliver strong cleaning performance in every corner and on any material.
Even the dust bag, which used to be nothing
| FOLLOW THE TR AIL
but a simple paper contraption, today contributes to energy efficiency with the use of new
high-performance materials. And sometimes
it’s small product design modifications that
make a vacuum cleaner more efficient, such
as reducing the diameter of the wand by one
millimeter or adding a fin in the model’s
interior. In the past five years, BSH has
submitted more than 40 patents on average
for each new model series in Germany to
protect innovations that reconcile convenience, performance and energy efficiency.
This kind of development effort pays off. In
just a few years, the engineers managed
to double the efficiency of their vacuum
cleaners. The most energy-efficient model
from Siemens uses up to 64 percent less
power than the brand’s older models. If it
were to replace every vacuum cleaner in
Germany, the energy saved would be enough
to supply 2,500 average four-person households for an entire year.
“Vacuum cleaners still offer huge potential as
far as energy efficiency is concerned,” says
Illig. One contributing factor will be the EU
energy efficiency label, which already helps
consumers today in selecting refrigerators
and clothes dryers.
Always That Bit More Efficient
Although its details are still being discussed,
BSH’s engineers are already working hard to
make sure that their products will far exceed
the new label’s requirements – just like the
dryers, washing machines and refrigerators
in BSH’s Super Efficiency Portfolio, that far
ex­ceed the EU’s requirements in terms of
energy consumption, performance and
convenience.
One prime example is the company’s heat
pump dryer. Equipped with a condenser that
flushes itself with the water collected from
the laundry, it is the only appliance in its
class that can guarantee long-term energy
efficiency. Unlike competing models it does
not need to be cleaned manually after every
other cycle. That way, BSH delivers maximum
convenience while making sure that the
model’s energy efficiency does not suffer.
Stiftung Warentest, Germany’s leading consumer watchdog, agreed and gave the model
the highest rating in its test in January 2012.
Double Test Win
Two vacuum cleaner models from BSH recently
won top ratings as well: the Siemens Z 3.0
among traditional models and the Bosch
Roxx’x among bagless models. This kind of
success is no accident, but the result of
tireless development work. In the labs at
BSH, new models have to deliver not only
under the standard conditions like those used
by Stiftung Warentest. “We conduct a whole
series of additional tests, which are based on
the findings of our customer service organi­z­
ation,” says Illig. Animal hairs on rough sisal
fibers or cookie crumbs in deep-pile carpeting
– BSH vacuum cleaners have to deliver clean­ing performance even under the toughest
conditions. “Performance is everything when
it comes to ensuring that customers are
completely satisfied with our models,” says
Illig. That’s why the energy detectives at
BSH’s air flow lab are working so hard to
leave the competition in the dust.
The self-cleaning heat
pump dryer is the only
one of its kind that
maintains its energy
efficiency rating over the
long term. Mechatronic
technician Alex Volk uses
a prototype to demonstrate those parts of the
test winner that are
critical for the automatic
self-cleaning process.
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| G lobetrotters
On their trip from the factory to the customer, appliances often travel
across entire continents. They must be able to withstand heat, cold,
humidity and rough handling without suffering any damage. Christoph
Rohr from BSH‘s distribution logistics department has analyzed the
shipping routes and all the challenges they face. In his lab he can
simulate the trip in a railcar across the Siberian tundra just as easily
as a truck shipment across India or a ride on a bicycle rickshaw over
bumpy country roads. With optimized packaging, all appliances will
make it to their destinations without a scratch.
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Christoph Rohr has made
unloading containers
faster and more efficient:
Thanks to his Slip Tarp,
a patented floor covering
that is unrolled in the
container before loading,
loads can now be pulled
out in one piece.
Home Appliances on Tour: The Right Travel
Outfit Makes the Difference
When they sit on the showroom floor it is
impossible to tell that each appliance was
once a passenger. In many cases they have
traveled for thousands of miles on trucks, in
ships, in railcars or on the bicycle rickshaws
of Asian customers. Especially on long trips
they have to withstand a lot: Vibrations on
potholed streets; temperatures ranging from
minus 30 to plus 80 degrees Celsius; high
humidity when containers are loaded, which
rains down on the printed boxes once the air
cools down on the open sea. It is not unusual
for the appliances to be subjected to g-forces
of up to 11 g’s when trucks hit potholes or
railcars are switched.
The fact that the appliances nevertheless
make it to their destination unscathed is not
luck, but is thanks to the experience of BSH’s
packaging experts. In various tests they
subject the products and their travel outfits
of paper, plastic and styrofoam to the same
conditions they will encounter in a container
and on the road. They make sure that the
customers’ enjoyment of their new appliance
will not be diminished by scratches or dents.
“At some point we began to question everything,” says Christoph Rohr, who developed
the packaging tests. “We looked at the most
common testing methods and realized that
they have very little to do with reality. That’s
when we started to look at what really
happens.” For the trained nautical and
industrial engineer this meant hitting the
road together with the appliances. For
example, he accompanied the products and
suffered the same bumps and vibrations
when they were trucked across thousands
of miles of roads in China and India.
Robust and Lean
The challenge: On the one hand, the appliances must be optimally protected. On the
other, the packaging must not be too thick so
that it takes up as little extra space as
possible. This reduces the number of trips
and protects the environment.
Rohr’s pioneering trips were followed by
systematically recording the road conditions.
To accomplish this, he equipped trucks with
measuring devices and GPS units. The
combination of location data and vibration,
temperature and humidity readings is used
to create detailed trip profiles, which can
| GLOBE TROT TERS
then be displayed on an electronic map or
used for stress tests. To run these tests, the
BSH engineers simply place a new appliance
on the vibrating table or into the climate
chamber, and the virtual trip can begin.
Based on the results, they can then design
the right packaging for shipments anywhere
in the world.
Quick loading and unloading procedures are
the goals of every logistician, because more
speed means more productivity. Along the
way, Rohr also invented a simple method for
saving a lot of time when loading and unloading small appliances such as vacuum cleaners, toasters, etc. The innovation, which has
been patented in the meantime, is called Slip
Tarp – a carpet made of robust material that
is rolled out in the container before the
loading process. In the past, the products
could be unloaded only through the narrow
end of the container, which blocked the
warehouse gates. Particularly with the large
number of small products fitting into a container, this procedure took a relatively long
time. The Slip Tarp allows all the contents to
be pulled out of the container in three large
blocks. Workers can now reach the units from
all sides and quickly forward them to their
next destination.
Reaching the Destination and Sparing
the Environment
“While working on ways to speed up the un­loading process, I received a tote bag made
from this special material at a trade show.
And that is what gave me the idea,” explains
Rohr. “I am glad that I had the opportunity to
give it a try without knowing in advance
whether it would work.” Such improvements
are also possible because BSH conducts its
global logistics operations mostly in-house.
BSH pays attention not only to speed, but
also to the environment. In Giengen, the
company’s largest logistics center in Ger­
many, BSH maintains a special freight railway yard with a storage area for containers
that would cover several soccer fields. From
here, the containers ride piggyback to several
large German ports, from where they are
shipped all over the world. The share of rail
freight is rising steadily. “In 2008 we made
25 percent of our shipments by rail. Today the
figure’s already 45 percent,” says site manager Manfred Brauckmann. The benefit for
the environment is that shipping by train
instead of truck generates up to 60 percent
less carbon dioxide.
Safe, fast and green – the logistics engineers
of BSH are mastering this ‘triple play’ to
optimize their shipping activities. In doing so,
they pay just as much strict attention to
quality as their colleagues in development
and production. From the logistics engineers’
point of view, it is a pity that the refrigerators
and dishwashers cannot tell the customers
about their travel adventures and the effort
that went into making sure that they arrived
at their destination safe and sound and on
time.
BSH coordinates most
of its global logistics
operations itself. Manfred
Brauckmann (left) and
Marco Passira make
sure that all appliances
reach their destination
safely, quickly, and as
environmentally friendly
as possible.
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| A S ource of I nspiration
Since a built-in kitchen usually needs to last for the next ten to twenty
years, Ronald Wassenaar and the team at the Dutch BSH subsidiary do
everything in their power to help customers choose the solution that
best suits their needs and will be enjoyed for many years to come. The
“House of Inspiration” in Hoofddorp near Amsterdam invites dealers
and private customers to acquaint themselves with the latest trends
and product innovations in an inspiring setting.
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26
The “House of Inspiration” on the outskirts of
Amsterdam embodies
BSH’s principles such as
environmental protection
and service orientation.
In the facility’s four
showrooms, customers
and dealers can learn
about the latest trends
from Bosch, Siemens,
Neff and Gaggenau, try
out appliances in a playful manner or attend
cooking classes.
Inspiration for More Quality of Life
Spider plants, white orchids, calla lilies – a
wall of more than 2,000 plants stretches over
three floors in the “House of Inspiration”,
bringing living nature into the building and
providing a pleasant atmosphere. The entire
complex is covered by a glass roof with solar
panels, flooding the atrium and the galleries
on each floor with natural daylight.
The “House of Inspiration” is innovative in
every respect. It reflects the values and principles of BSH, such as innovation, customer
service, employee orientation, responsibility
for the environment and society, and sus­
tainable value creation. The building was
designed and built according to the cradleto-cradle principle, which means that all
materials and furnishings are recycled when
they reach the end of their useful life. It also
uses rainwater and solar energy. In addition,
the facility is home to more than just the
spacious showrooms, with its upper floors
housing the workplaces of the 270 office
staff who work for the Dutch subsidiary BSH
Huishoudapparaten B.V. The concept of service has top priority in all areas – not only
with regard to customers and dealers, but
also in accounting, IT or marketing.
Hospitality manager Hans van der Bilt and his
team make sure that guests feel welcome as
soon as they set foot in the building: A friendly
glance, a freshly brewed latte macchiato, and
consultants who provide information tailored
to the customers’ needs – the trained hotel
professional knows what people want. “Customers sense that when they come to us, they
can sit back and relax as they plan a kitchen
that really suits them,” says van der Bilt.
Top Service as a Matter of Principle
Nothing is for sale in the showrooms, however. “After all, we are not competitors, but
partners for specialist dealers,” says marketing head Ronald Wassenaar. That is also why
the “House of Inspiration” does not just
target customers, but was also designed to
meet the specific needs of dealers. Whether
the specialist dealers are familiarizing
themselves with new product features in
entertaining cooking classes, learning about
the latest trends in the training center or
auditorium, or getting ideas about how to
present the various brands in an attractive
manner on limited floor space – they leave
Hoofddorp inspired to drive their own
business forward.
Wassenaar also wants to revolutionize the
decision-making process involved in buying a
kitchen: “Today, customers give a lot of thought
to finishes, work surfaces and cabinet
layouts. Only once they have decided on the
‘look’ of the kitchen do they then quickly and
randomly pick out appliances,” he says. They
| A S O U R C E O F I NS P I R AT I O N
Hospitality manager
Hans van der Bilt and
his team have one main
mission – to perfectly
cater to their customers’
needs. Based on their
cooking and shopping
habits, the BSH team
can point out which
appliances will work
best for their particular
needs.
do not realize that it is the appliances that
make all the difference when it comes to
actually enjoying the kitchen. “Ideally,
customers should therefore start out by
selecting the appliances that best meet their
way of life, their cooking habits and their
demands in terms of user-friendliness, design
and environmental compatibility, and then
put together the right kitchen.”
testing cubicle, customers can compare the
noise of the latest dishwasher model with the
kind of noise produced by a nearby freeway
or gentle birdsong. And at an inter­active
display, visitors can even throw pots and
bottles against the glass front panels of
appliances to see for themselves that they
are scratch-proof.
Four Brands under One Roof
The “House of Inspiration” is the best place
for this since the consultants cater for the
individual needs of each customer. For
example, selecting the right refrigerator
depends not only on the size of the household, but also on the shopping frequency.
“People who go to the grocery store only once
a week will benefit in particular from the
Vitafresh function, which keeps fruit and
vegetables fresh longer,” says Wassenaar.
Always Take the Customer’s Point of View
But it’s not just about products either. The
facility also demonstrates innovative design
solutions – sometimes in a playful manner.
For example, customers can use a magnetic
wall to arrange the various kitchen elements
and find the most ergonomic layout. “Before
playing with this wall, some customers had
no idea that they could install their dish­
washer at chest height to avoid having to
keep bending down when loading and
unloading dishes,” says Wassenaar. In a
Unlike in Germany, where people tend to be
more familiar with this marketing tool in the
automotive sector, showrooms for kitchen
appliances are quite common in the Netherlands. At BSH, the showrooms are part of an
innovative customer relationship management concept. The goal is to target customers
who are considering buying a kitchen and to
cater for their individual needs over the long
term. “Our particular strength lies in the fact
that we can present four brands under one
roof and allow people to experience them
hands-on,” says Wassenaar. Customers who
have spent a Saturday in the “House of Inspiration” leave Hoofddorp with the positive
feeling that they have been able to gain a
comprehensive overview of what the market
has to offer. And ultimately it is the specialist
dealers who also benefit from this concept:
“Customers who have been to a showroom
are already well-informed when they enter the
store – and they also appreciate quality.”
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| Essay
| b y D r . K urt - L udwig G utberlet
German industry as a whole has the potential to save 30 billion kilowatt
hours of electricity. If all home appliances in Germany over 10 years old
were updated, 15 billion kWh could be saved. A further 12.3 billion kWh could
be saved in relation to home appliances through incentive schemes
administered by German electricity suppliers. The transition of energy
systems towards sustainability can only be achieved if energy is seen as
part of regulatory policy.
| E SS AY
| Regulatory
Policy Must Refocus
on Energy Efficiency
Energy efficiency and climate protection have
been key to corporate strategy at BSH Bosch
und Siemens Hausgeräte GmbH since it was
established in 1967. In recent decades, these
issues have grown in importance – not least
due to Germany’s definitive withdrawal from
nuclear power.
The decision to phase out nuclear means
that, by 2022 at the latest, Germany will
have something in common with most other
countries in the world. No nuclear power,
almost no fossil fuels of its own, and more
questions than answers in terms of the
financing and utilization of alternative energy
sources. At the same time, the current IEA
World Energy Outlook estimates that global
energy consumption will actually rise by at
least one third by 2035.
A paradigm shift: Promote energy saving not
energy production
The question is therefore now much more
pressing than previously: how can energy
demand be reduced without hampering
economic growth? In our approach to energy
production, we remain transfixed like a rabbit
in the headlights. Energy efficiency is only
gradually being considered an important
part of the energy transition. The focus of
our concern should shift from what we can
produce to what we can avoid producing.
Energy efficiency is not only a short-term
answer to the pressing gap in energy supply,
but also a long-term opportunity to use
energy more productively.
In the interest of climate protection by 2020,
the EU plans to reduce its energy consumption
by 20 percent compared with 1990 levels.
Yet according to estimates by the European
Commission, without additional measures
being taken, only half of this reduction
target will be achieved. The German federal
government has set an even higher target of
40 percent reduction by 2020. Yet a wide gap
is emerging between the words spoken by
politics and industry and their deeds. Other
EU countries are providing significant support
for these reductions, but Germany is dragging
its feet. The reduction target is an urgent
necessity and cannot be achieved simply by
the sum of reasonable measures taken
individually. We need fresh thinking in terms
of regulatory policy. The energy transition
requires a shift in regulatory policy: electricity
companies must be included in the obligation
if we are to achieve the EU reduction target.
Saving energy is also worthwhile from a
financial perspective. Production costs per
kilowatt hour in Germany are on average
three times as high
as the cost of re­ducing consumption
by the same amount.
Despite the variation
between conditions
in different countries,
energy efficiency
remains the neatest
way to defuse the
worldwide energy
problem. Energy
efficiency is attractive because it does not
require consumers to do without the home
comforts they are used to. It is politically
workable, because it does not elicit resistance in the same way as the construction of
wind farms or new overhead power lines.
Above all, it is quick and can be achieved
with today’s technology.
“Production costs per
kWh in Germany are
three times as high as
the cost of reducing
consumption by the
same amount.”
However, we must not get carried away:
energy efficiency operates at different
speeds.
The German corporate energy efficiency
initiative (DENEFF) has identified an energysaving potential of 30 billion kWh in German
industry. But each individual investment must
be assessed against its outcome in terms of
energy savings and in relation to the relevant
29
30
plant and process – a cumbersome administrative procedure with an uncertain outcome.
It is much simpler to save electricity through
home appliances. For 17 years, the European
energy label has displayed a standard energy
rating for each appliance. Domestic appliances
have a high energy-efficiency potential
because they make up 40% of household
electricity consumption. If all domestic
appliances in
Germany over 10
years old were
exchanged for highly
efficient appliances,
15 billion kWh could
be saved each year.
Thus the potential
for saving energy
through the use of
more efficient home
appliances is equivalent to half of the potential savings from German industry. Across
Europe, 30 percent of all household electrical
appliances are over 10 years old. If all these
appliances were replaced with highly efficient
ones, an annual saving of 44 billion kWh
could be achieved – the equivalent of Portugal’s annual energy consumption.
“Intelligent regulatory
policy does not mean
distributing
large amounts of
public money.”
Due to the great potential for energy saving in
the household appliance sector, it would be
worth politicians providing incentives here.
The core message for a new energy efficiency
policy could be summarized as: explain,
promote, apply penalties and provide leadership.
Explain: More clarity and distinction between
efficiency classes
Only very few consumers know the difference
between the A and A+++ ratings. The top
priority for responsible regulatory policy
would therefore be to explain and clarify
energy consumption and how to avoid it. This
applies to all areas – from the whole-house
Energy Performance Certificate to the light
bulb. We note that labeling systems tend to
develop and establish themselves worldwide,
and advise interested governments and
non-governmental organizations throughout
the world on domestic appliances. It is true
that an international comparator will remain
just a dream for some time to come. Yet all
systems should observe one major fundamental principle, namely that of taking
technological progress into account. We
therefore strongly support the dynamic
updating of the energy label criteria. Above
all, the nomenclature for energy standards
must be clearer, allowing distinctions to be
identified at a glance.
Promote: Create incentives to buy
Initially, it would seem that the simplest tool
for motivating consumers to buy more effi­cient appliances would be a program of state
support, i.e. a direct or indirect subsidy for
the purchase of appliances in the highest
efficiency class. For many years, we have
been discussing this type of measures with
policy makers. Compared to the eagerness
with which subsidies are applied in other
areas – the German government paid some
EUR 9 billion to subsidize solar energy in 2011
– in this case modest sums could make a big
difference. However, irrespective of the fact
that the public purse is empty, there are other
reasons to be skeptical of such programs.
Intelligent regulatory policy does not mean
distributing large amounts of public money:
it also means using financial resources
efficiently.
Apply penalties: Implement minimum
standards, eliminate energy guzzlers
It would be more effective to ban inefficient
appliances. But in the EU and elsewhere, it is
clear that we are far from taking such a step.
Fridges in class A consume 2.5 times as
much energy as appliances in the current top
energy efficiency class A+++. But a ban on
marketing A-class appliances will come into
force much too late: on July 1, 2012. There are
no comparable restrictions on other energy
guzzlers in private households. For example,
tumble dryers: annual electricity consumption
can be reduced by almost two thirds, from 350
kWh to around 120 kWh, by using super-efficient appliances. No European legislator has
yet grasped this opportunity. Dryers in energy
| E SS AY
efficiency class D may still be sold in Europe.
Without more radical minimum standards, we
run the risk of hampering a tangible improvement in efficiency standards. One need only to
look at the sales figures for home appliances
with low energy efficiency ratings to see that
supply can create demand.
Provide leadership: Intelligent policy-making
as the “game changer”
In the battle against the waste of energy,
regulatory policy has more subtle methods
than outright bans. Using a more nuanced
approach would keep public costs low while
exploiting market forces. Since policy can only
exercise a limited direct influence on con­
sumer behavior – and even then only using
means that are dubious from a political, tax­payer and/or market perspective – it should
aim to exercise indirect influence via energy
suppliers.
On this issue, the EU is on the right track. In
its proposal for a directive on energy efficiency, the European Commission puts forward
market-oriented measures to implement
energy savings. Energy suppliers would be
obliged to achieve annual savings quotas.
Critics of this approach are too quick to label
this as redolent of a planned economy,
with its restriction on manufacturers’ sales
volumes and energy-saving obligation on
consumers. They are missing the point. The
savings targets are consistently based on
the previous year’s sales volume. Energy
suppliers who are particularly successful on
the market and in promoting efficiency can
therefore continue to grow and expand.
A system of white certificates would mean
that savings made could be traded.
White certificates provide a market incentive
for energy suppliers to reward their customers
for improved efficiency. The certificates would
release great creativity, and could in the best
case scenario create new branches of the
energy service sector, as efficiency measures
are currently certainly not part of energy
producers’ core business. Thus energy consumption would probably be reduced much
more quickly and effectively subject to the
free play of market forces than it would be
using intervention aimed directly at the
consumer.
The conditions under which white certificates
would operate must
of course be framed
so that targets are
achievable and like
is compared with
like. They must also
address quantity
structures that are
attractive to the
economy as a whole, while also permitting
their effectiveness to be measured. In con­trast to other measures, the cost of procuring
highly efficient home appliances is transparent and can basically be funded by householders themselves, whether they own or
rent. What is more, the large, stable numbers
involved ensure reliable framework conditions for a white certificate system. Supporting energy efficiency measures in private
households through programs implemented
by energy suppliers would enable annual
savings of 12.3 billion kWh to be made from
household electrical appliances alone. This
corresponds to 10 percent of overall electricity consumption in the private sector. Countries where the level of efficiency is currently
lower would be able to make much greater
progress.
“Energy efficiency
is not only of moral
value, it is also of
economic value.”
If we are to tackle the energy transition
thoroughly, then the kilowatt hours saved
must be made tradable. This sounds more
radical than it is. Energy efficiency is not only
of moral value, it is also of economic value.
Dr. Kurt-Ludwig Gutberlet
Chairman of the Board of Management
31
32
| Supervisory Board Report
33 Supervisory Board Report
35 Board of Management, Supervisory Board
SUPERVISORY BOARD REPORT
| Supervisory Board Report
During the year under review, the Board of Management reported
regularly to the Supervisory Board on the performance of the company
and on its major decisions, both orally and in writing.
Joe Kaeser,
Chairman of the
Supervisory Board
The development of business and employment during the preceding
financial year 2010, as well as the 2010 financial statement and
management report, were explained to the Supervisory Board by the
Board of Management at the two regular Supervisory Board meetings
held during the year. During 2011, the Board of Management reported
to the Supervisory Board on the development of business in the
company’s various sales regions, particularly in Germany, Spain,
Greece and Turkey, the rest of Western and Eastern Europe, in China,
Russia, India, Central and Southeast Asia, and North America. The
Board of Management also presented the key data for the 2012
Business Plan to the Supervisory Board. The Supervisory Board
discussed these topics in detail.
Other advisory efforts by the Supervisory Board focused on the development of competition in
the European and non-European home appliance markets as well as the company’s response
to changing market conditions.
The Supervisory Board also deliberated on the development of the Product Areas, on projects
aimed at further developing markets, on the planned construction of an Appliance Park in
India, the expansion of our factory in Russia and site development in New Bern, USA and
Berlin.
The topics addressed by the Supervisory Board also included development in China, in
particular in the country’s rural areas, and development with regard to the Chinese market for
built-in appliances. The Supervisory Board also discussed the meaning of the internet for the
home appliances business as well as new demands social media place on companies.
The Supervisory Board sought details from the Board of Management about the company’s
internal control system, including the internal auditing system, about risk management within
the company, the assessment of risks and the creation of provisions. The Board of Management also reported to the Supervisory Board on the compliance organization, the compliance
training conducted and compliance-related issues in 2011. The Supervisory Board also received reports from the Board of Management about the results of the tax audit for assessment periods 2003 through 2006 and the related and not inconsiderable costs for the year
under review. In this context, the Board of Management reported on various internal audits
which were conducted. In addition, the Supervisory Board decided to seek counsel’s opinion
and set up a working group made up of experts from the shareholders. Furthermore, the Board
of Management reported on the implementation of preventive measures in the future. The
Supervisory Board discussed the matter in depth.
In addition to its official sessions during the course of the year, regular discussions also took
place between the Board of Management and the Chairman of the Supervisory Board and his
deputies.
33
34
The financial statement of BSH Bosch und Siemens Hausgeräte GmbH and the consolidated
financial statement as of December 31, 2011, as well as the management report for BSH Bosch
und Siemens Hausgeräte GmbH and the Group management report have been audited by
Deloitte & Touche GmbH Wirtschaftsprüfungsgesellschaft, Munich, and have been given their
unqualified approval. The reports prepared by the auditors were presented to all members of
the Supervisory Board. The Supervisory Board thoroughly examined the documents concerned
and the Board of Management’s proposal regarding the allocation of net income. The reports
were discussed in full at the Supervisory Board’s meeting to approve the balance sheet, which
was held in the presence of the auditors.
The Supervisory Board raises no objections and concurs with the findings of the audit. It
approves the financial statements and management report of BSH Bosch und Siemens Hausgeräte GmbH as well as the consolidated financial statements and Group management report;
it recommends the shareholders to confirm the financial statements, to approve the consolidated financial statements and Group management report and to accept the Board of Management’s proposal regarding the allocation of net income.
Mr. Thomas Bauer left the Supervisory Board on June 30, 2011. Mr. Mehmet Gürcan Karakaşş
was elected to succeed him effective July 26, 2011. Mr. Dieter Schweisfurth left the Supervisory
Board on July 31, 2011, and Mr. Axel Fischer succeeded him effective August 1, 2011. Mr. Klaus
Helmrich was elected to succeed Prof. Hermann Requardt, who had left the Supervisory Board
on October 31, 2011, effective November 1, 2011.
The Supervisory Board would like to thank the Board of Management and the company’s
employees for their successful endeavors over the past year.
Munich, 11 May 2012
For the Supervisory Board
Joe Kaeser
Chairman
BOARD OF MANAGEMENT AND SUPERVISORY BOARD
| Board of
Management
| Supervisory Board
Dr. sc. pol. Kurt-Ludwig Gutberlet
Chairman
Corporate Strategy,
Corporate Communications,
Law and Industrial Policy,
Compliance,
Corporate Responsibility,
Internal Audit,
Information Security,
Consumer Products,
Customer Service
Joe Kaeser, Munich
Chairman of the Supervisory Board
Member of the Managing Board of
Siemens AG
Mehmet Gürcan Karakaş, Stuttgart
(since 26.07.2011)
Director of Corporate Marketing and
Sales of Robert Bosch GmbH
Elmar Freund, Bad Neustadt
Deputy Chairman of the Supervisory
Board
Chairman of the Group Works
Committee
Peter Kern, Frankfurt
Union secretary to the executive
committee of the
IG Metall trade union
Jean Dufour
Corporate Sales,
Brand Management,
Logistics
Johannes Närger
Finance and M&A,
Balancing, Accounting,
Corporate Development
and Controlling,
Labor Relations Director,
Human Resources,
Data Protection,
Information Technology,
Purchasing,
Tax, Customs,
Insurances,
Process and Performance
Management
Winfried Seitz
Product Area Dishwashers,
Product Area Cooking,
Product Area Cooling,
Product Area Laundry Care,
Electronic Systems and Drives,
Corporate Technology,
Environmental, Occupational, Health,
Fire and Disaster Protection
Dr. rer. oec. pol. Rudolf Colm,
Stuttgart
Deputy Chairman of the Supervisory
Board
Member of the Board of Management
of Robert Bosch GmbH
Dr. rer. pol. Stefan
Asenkerschbaumer, Stuttgart
Deputy Managing Director of
Robert Bosch GmbH
Thomas Bauer, Stuttgart
(until 30.06.2011)
Director of Corporate Marketing and
Sales of Robert Bosch GmbH
Ellen Bonna-Knöpp, Giengen
Chairwoman of the Works Committee
of the Giengen plant
Dr. rer. nat. Siegfried Dais, Stuttgart
Deputy Chairman of the Board of
Management of Robert Bosch GmbH
Axel Fischer, Berlin
(since 01.08.2011)
Director Purchasing
Product Area Laundry Care
BSH Bosch und Siemens
Hausgeräte GmbH
Klaus Helmrich, Munich
(since 01.11.2011)
Member of the Managing Board of
Siemens AG
Stefan Rauschhuber, Rosenheim
Senior authorized representative
of the IG Metall trade union,
Rosenheim administrative office
Prof. Dr. phil. nat. Dipl.-Phys.
Hermann Requardt, Munich
(until 31.10.2011)
Member of the Managing Board
of Siemens AG
Wolfgang Rückert, Traunreut
Deputy Chairman of the Works
Committee, Traunreut plant
Prof. Dr.-Ing. Dipl.-Ing. Siegfried
Russwurm, Erlangen
Member of the Managing Board
of Siemens AG
Dieter Schweisfurth, Hamburg
(until 31.07.2011)
Head of Sales, Bosch Northern
Region, BSH Bosch und Siemens
Hausgeräte GmbH
Karl-Heinz Seibert, Munich
Corporate Vice President,
Head of Mergers, Acquisitions
and Post Closing Management
of Siemens AG
Siegfried Stegmann, Nuremberg
Chairman of the Nuremberg Works
Committee
Franz Veh, Dillingen
Chairman of the Works Committee,
Dillingen plant
35
36
| Group Management Report
In a difficult market environment, BSH managed to outperform the expected
sales revenue in the financial year 2011. To this development contributed not
only the on high levels slightly curbing demand in the dynamic markets in
Eastern Europe and Asia, but also the increasing new orders in Germany. The
cumulative demand for home appliances that combine energy efficiency
and highest standards of comfort shows us that we are on the right track
with our long-term strategy.
37 Development of Business
53 Net Assets, Financial Position and Results of Operations
59 Management of Opportunities and Risks
63Outlook
DEVELOPMENT OF BUSINESS | GROUP MANAGEMENT REPORT
Development of Business
Overall economic development
The world economy continued its economic recovery in 2011, but came under increasing
pressure during the course of the year. The political upheavals in the Arab world, the disaster
in Japan in March and the deepening debt crisis in the U.S. and especially in Europe clouded
the business climate significantly and triggered a noticeable slowdown. Nevertheless, global
gross domestic product continued to grow in 2011 at a solid rate of 3.2 percent.
As in recent years, the emerging markets contributed disproportionately to global economic
trends, although economic policy at the same time has slowed the growth rate for some time
now.
Following double-digit growth rates in previous years, the increase in value added in China
was still 9.2 percent. The strongest growth impetus here came from domestic demand, while
exports lost momentum noticeably. The Indian economy also lost some of its momentum.
After an increase of 9.0 percent in 2010, gross domestic product rose here in 2011 by just
7.3 percent.
Eastern European countries, on the other hand, were able to maintain their 2011 growth rate
at 4.4 percent (2010: 4.4 percent). However, the EU debt crisis also affected economic development in most Eastern European countries.
Economic output in the developed world appeared weaker, with few exceptions. Following
modest growth in Western Europe in 2010, the debt crisis has slowed the expansion in recent
times. The value added rose by only 1.5 percent, even less than a year ago (2.0 percent).
Southern European countries were again mostly in recession.
Development in Germany was again extremely positive, recording a plus of 3.0 percent (2010:
3.7 percent). This was due mainly to domestic investment and private consumption. However,
the German economy slackened again at the end of 2011 for the first time since early 2009,
also as a result of the EU debt crisis.
In the U.S., the economy likewise lost its buoyancy noticeably. Persistently high unemployment, continued strong asset losses and the worsening of the debt crisis in the summer of 2011
dampened the domestic economy. Growth rates of just 1.7 percent (2010: 3.0 percent) were
recorded.
The weaker economic growth of the global economy and falling raw material prices from
mid-2011 weighed on growth in Latin America. Even against the backdrop of a less expansionary economic policy, growth was lower at 4.4 percent than in 2010 (6.4 percent).
The recovery from the global financial market crisis of 2008/2009 continued in 2011 but at a
slower pace. The deepening EU debt crisis, however, proved increasingly to be an economic
burden – especially for individual European countries, but also for Europe as a whole and for
the world economy.
The deepening EU debt
crisis, however, proved
increasingly to be an
economic burden –
especially for individual
European countries,
but also for Europe as
a whole and for the
world economy.
37
38
Development of the market for large home appliances
The global market for large home appliances showed different regional trends in 2011. After
the market was initially able to recover on a broad basis in 2010 from the immediate consequences of the financial and economic crisis, the increase in demand was significantly dampened in 2011.
The negative market development in Western Europe was primarily impacted in 2011 by the
European states in crisis. Sales were reduced by a significant extent in the large home appliances markets of Portugal, Spain, Italy and Greece. The markets in Italy and Portugal slipped
back into the red following a brief recovery in 2010. The Irish market also showed no recovery
in 2011 after 2010. The markets in France and Sweden continued to show difficult sales trends,
which were below the development of the previous year.
Contrary to most other
European markets the
German market took
a positive course in
the year under review.
Germany, the largest market for large home appliances in Western Europe, continued to
perform well however. While private consumption represented an important pillar of the
economy, the market grew in line with the positive consumer sentiment. The German market
played a crucial role in this as a mainstay of demand in Western Europe. The market in Switzerland likewise performed well, with sales in the euro significantly stronger than in the local
currency.
The Eastern European market (including Turkey) for large home appliances was again able to
produce good revenue growth after 2010.
This was due mainly to Russia, the largest market in the region, which recorded double-digit
growth. Strong growth was recorded in the local currency in the Turkish market, although the
market in euro terms declined slightly. The market in Ukraine likewise continued its growth
pattern, albeit at a lower level. Of the major countries in Eastern Europe, only the Polish market
was unable to record a growth in sales.
In the North American continent, the two markets of U.S. and Canada declined to a similar
extent, with the decline slightly greater in Canada than in the U.S.
Within Latin America, the three largest markets in Brazil, Mexico and Argentina recorded
positive growth at a similar level in the local currency. In euro terms, some of the markets in
the Latin American countries developed better, some worse than in the local currency. Overall,
the market growth in Latin America in euro terms was lower than on the basis of local currencies.
In three of the largest provinces in China, the support program for home appliances ended in
2011. In parallel with this, China, the largest growth driver to date for the global market for
large home appliances, showed a marked slowdown in growth. The remaining regions in Asia
largely continued to develop positively, albeit at a slightly slower pace.
DEVELOPMENT OF BUSINESS | GROUP MANAGEMENT REPORT
With non-uniform developments in the different countries, the markets of the Middle East and
Africa recorded an overall market decline in euro terms. This was mainly due to the negative
markets and currencies in the North African countries.
Overall, the global market for large home appliances in 2011 was only down slightly, net of
currency effects. Due to the increasing strength of the euro during the year, the market volume
stagnated in euro terms at the previous year’s level. In essence, this development was due to
weak markets in Western Europe and North America as well as a generally declining trend in
market growth in the remaining regions.
Revenue development
In the 2011 year under review, the BSH Bosch und Siemens Hausgeräte GmbH Group (referred
to in the text as “the Group” or “BSH” and “BSH-D” in relation to the parent company) generated consolidated revenue of EUR 9.654 billion, a year on year increase of 6.4 percent. Net of
currency effects, revenue amounted to EUR 9.812 billion, 8.2 percent more than in the previous
year.
Group revenue BSH (IFRS)
in EUR billion
2011
2010
9.654
9.073
The market for home appliances in Germany registered growth of 3.8 percent in 2011.
In Germany, the Group significantly outperformed the market and increased its turnover by
8.2 percent to EUR 2.062 billion, attributable especially to the strong performance in the area
of consumer products and built-in appliances. This positive development was embodied
additionally by the strong trend toward energy efficient products as well as successful innovations. As a result, the proportion of revenue generated inside Germany rose from 21.0 percent
to 21.4 percent.
In Western Europe – excluding Germany – revenue fell by EUR 26 million to EUR 3.514 billion.
In Spain, Greece and Portugal in particular, a decline in revenue was recorded owing to the
persistently challenging economic conditions. In Great Britain, France, Switzerland, Belgium
and Northern Europe, on the other hand, BSH was able to achieve some significant gains.
Revenue in Eastern Europe increased by 15.5 percent to EUR 1.846 billion. The markets in
Russia, Turkey and Poland, in particular, bore the signs of very high growth in euro terms. The
Turkish Lira and the Russian Ruble had a negative impact owing to conversion rate trends.
On the North American market, BSH’s consolidated revenue in the year under review was
considerably below that of the previous year. The sales declines are primarily due to the
withdrawal from the 27-inch segment in laundry care and the development of the U.S. dollar.
Revenue by region (as of December 31, 2011)
Other 2.0%
Germany 21.4%
Asia 15.6%
North America 5.0%
Latin
America 0.5%
Western Europe
36.4%
Eastern Europe
19.1%
(including Turkey)
The Group reported excellent business
development in Asia. Revenue in China
increased by almost 20 percent. Very positive
revenue development was also reported in
India, Malaysia and Singapore. In the Middle
Eastern countries and in South Africa, the
previous year’s figures were significantly
exceeded.
The Group reported a strong growth in revenue
in Australia and Oceania, for currency-related
reasons among others.
The market for household
appliances in Germany
augmented by 3.8 percent
in 2011. BSH’s turnover
increased disproportionally high by 8.2 percent
compared to the
previous year.
39
40
Research and development
In the year under review, the Group spent EUR 298 million on research and development, thus
some 3.1 percent of revenue. On December 31, BSH had a workforce of 2,748 employees in this
area (2010: 2,503 employees), and of these 1,537 in Germany (2010: 1,397 employees).
Several new buildings were put into operation or planned for research and development in
2011. The building layout and the facilities have been designed to optimally support modern
work practices in product development and promote creativity and cooperation. For example,
development departments, laboratory facilities and meeting areas were designed according to
the latest findings on the process organization.
Expenditure for research
and development amounted to 3.1 percent of
revenue in the year under
review.
The development center for refrigeration appliances was opened in Nanjing (China). The
special knowledge and proximity to the local market allow the needs of Chinese households to
be identified more precisely and implemented in new products. Together with the existing
competence center in Giengen (Germany), the center in Çerkezköy (Turkey), which is currently
being extended, as well as the development center in Esquíroz (Spain), the development center
will continue in the future to form the innovative Quadriga for the development of refrigeration
equipment within BSH.
BSH opened a new technology center in Berlin with worldwide responsibility for innovative
product development of laundry care. In the “Green Building”, a center developed on the
basis of the latest ecological findings, some 700 experts are working on new technologies
and innovative applications for the next generation of laundry care appliances. They also
use a network involving Berlin’s universities and scientific institutions.
Expenditure for research and
development
in EUR million
298
277
20112010
The Group invested in a new development center for fully automatic coffee machines and
espresso machines in Traunreut in order to strengthen the technology base for coffee even
further. The company will create new jobs here in the areas of development and quality
management.
The construction of a further development building with additional laboratories is planned
for the global competence center for the Product Area Dishwashers in Dillingen. Planning
permission for this was granted in the fall.
In a bid to secure its technology leadership, BSH extended its cooperation with domestic and
foreign universities and research institutions in 2011. Of critical importance here were the
objectives of an efficient network and a clear prioritization of application-related technologies.
In the year under review, BSH again succeeded in successfully positioning newly developed
products on the market. In particular, the attractive portfolio of super-efficient household
appliances was extended to ensure greater success in this ever growing market segment. In
2011, numerous products from the portfolio were therefore again presented at the Inter­
national Consumer Electronics Fair (IFA) in Berlin.
The technical innovations of BSH are also reflected in the consistently high number of new
patent registrations – in the year under review, the Group is once again among the most active
patent applicants in Germany. Based on this claim, the Group is continuously and consistently
consolidating its global intellectual property portfolio in key technological and market-related
areas.
In 2011, BSH also successfully defended its top ranking in product tests. With 64 test winners
(2010: 53) BSH still has a lead over its competitors. The Group and its brands were involved in
145 comparison tests (2010: 124). The test organizations rated 50 Group brand products as
best-buy recommendations (2010: 45). In this category, too, BSH came out on top with a clear
lead over its competitors.
DEVELOPMENT OF BUSINESS | GROUP MANAGEMENT REPORT
Technically impressive innovation and excellent quality combined with particularly eye-catching design characterize the BSH products. This was again confirmed impressively in the year
under review with BSH winning more than 140 design awards, among these such prestigious
awards as the “iF product design award”, the “red dot design award”, the “interior innovation award” and the “Design Prize of the Federal Republic of Germany”.
To sustain its technology and innovation leadership, the Group-wide introduction of the BSH
Development System was launched in the year under review. The shorter development times
and processes, assurance of the necessary protection of resources, the containment and
reduction of complexity as well as increased flexibility are tasks that are to be addressed
through specific measures within the framework of the BSH Development System.
Best-practice methods are therefore used at all BSH development sites. In the product areas,
implementation of the BSH Development System is also supported intensively by specialists
and a needs-based training program.
BSH’s products were
distinguished with more
than 140 design awards
in 2011.
Procurement
The performance of the economy as a whole at the beginning of the year was more positive
than later on in the year. In most procurement markets this led to higher demand and as a
result considerable price increases. Over the course of the year, prices stabilized initially in the
second quarter before falling again in the second half of the year.
In the area of raw materials, the development of market prices, especially in flat steel and
plastic granules, was pronounced. Apart from the demand, this was mainly driven by prices of
primary products, such as iron ore and coking coal for steel production as well as propylene,
styrene and additives for the production of plastics. The price trend for stainless steel was
similar, but flatter. The downward trend in prices began earlier in the area of industrial metals
and continued until shortly before the end of the year, with this trend being particularly
pronounced in the case of nickel.
With respect to manufacturing materials, the market prices developed unevenly. There were
extreme price increases in rare earth elements. This was especially true for cerium, used for
enamel and neodymium for electric motors.
BSH achieved stable purchase prices again in the field of electronics while chemicals and
primarily rigid foam were affected by an unfavorable price trend.
Positive effects were realized through the use of international supplier markets. In addition,
the securing of raw materials from non-ferrous metals was expanded. Contracts concluded at
an early stage as well as longer-term contracts for steel continued to impact manufacturing
costs favorably. An additional contribution affecting net income was provided through the
increased use of Group-wide bundling of procurement.
Despite the increase in demand in the first half of the year, there were no noticeable delivery
bottlenecks in comparison with the previous year. This also applied to BSH procurement in the
period following the natural disasters in Japan and Thailand.
Despite the natural
disasters in Japan and
Thailand there were no
noticeable delivery
bottlenecks.
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42
In order to standardize the payment terms from suppliers further, adjustments were again
made to the payment conditions in the year under review.
In relation to the purchase of indirect materials, the organization, standardization and bund­
ling continue to make good progress. The process of electronic order processing has been
extended and implemented in various locations in Germany and abroad. An Order Center was
set up in Poland for this purpose with responsibility for Europe. The cataloging of the indirect
material enables efficient processing of transactions and provides scope for greater strategic
alignment. The bundling activities in purchasing in relation to indirect materials were targeted
mainly at production-related areas and information technology. Bundling activities were
likewise initiated in the areas of marketing and services.
Under measures to mitigate supplier-related risks, proven methods of financial supplier
analysis were again used for early detection and risk management.
As in the previous year, BSH strategically used derivatives in order to counter the market and
price risk in the procurement of individual, selected raw materials.
Production
BSH produces its large home appliances and small consumer products in 42 factories at 28
locations in 13 countries around the world.
BSH produces its large
home appliances and
small consumer products
in 42 factories at 28
locations in 13 countries
around the world.
2011 was marked in the Product Area Laundry Care by the establishment of the factory in
St. Petersburg (Russia) in order to take account from mid-2012 of the ever increasing demand
for washing machines on the Russian market. Furthermore, technical and organizational
upgrading of the factory in Çerkezköy (Turkey) to new, uniform product platforms was carried
out. To meet the increased demand for washing machines and washer dryers in China, additional investments were also made to expand production capacities in Nanjing (China).
In New Bern (USA), BSH withdrew from the regional production of washing machines. Due to
the extremely aggressive competition, which led to a sharp fall in prices, the unprofitable
main segment of the U.S. market with 27-inch equipment was abandoned. By transferring
employees to the manufacturing of dishwashers, the impact on the workforce was reduced.
Following the success of 2010, the BSH home appliances plant in Nauen was again awarded
“Factory of the Year” by the trade journal “Produktion” and the consulting firm A.T. Kearney
and also received the “Global Excellence in Operations” award. The subsidiary impressed here
in particular thanks to the high value added and efficient use of resources in all areas.
The Product Area Refrigeration began in 2011 to supply the Russian market with NoFrost
refrigeration equipment from the refrigeration plant in St. Petersburg.
An innovative product platform for refrigeration appliances started up in Çerkezköy (Turkey),
following heavy investment in efficient plants there the previous year. The factories in Giengen
(Germany) and Esquíroz (Spain) were also equipped with new production technology in order
to prepare for new series of appliances and to ensure sustained high performance.
DEVELOPMENT OF BUSINESS | GROUP MANAGEMENT REPORT
The foundations for further growth in China were laid with the start of construction of an
additional factory and logistics building in Chuzhou.
The Product Area Cooking concentrated in the year under review on the consistent continuation
of the program commenced in 2010 to optimize production. With the objective of increasing
competitiveness, measures were implemented in particular to standardize and develop innovative manufacturing technologies in addition to structural adjustments in the factories.
To meet the increasing future capacity requirements, manufacturing and development capabilities were expanded in China. The construction of a new factory is planned in India.
In the Product Area Dishwashers, the main emphasis at all locations in the year under review
was the optimization of production facilities. At the same time, new series of appliances were
successfully launched both in Çerkezköy (Turkey) and in Dillingen (Germany).
The small home appliances division, Consumer Products, set itself ambitious growth targets
for the future with the Vision 2015 program. The existing product portfolio was supplemented
in 2011 by innovations such as the new series of the Tassimo hot beverage system and expanded to include the award-winning bagless vacuum cleaner and the new Filtrino hot-water
dispenser.
The sales volume of self-manufactured consumer products has been growing steadily for
years. The increasing demand for our own manufacturing capacity is also fulfilled by the
division through productivity gains and especially through consistent implementation of the
BSH Production System. Investment will be made here in the development of products as well
as in production technology.
With the forward-looking decision to set up a new factory at the Çerkezköy site (Turkey), the
Consumer Products division is equipping itself for further growth.
A new production record was set in Bad Neustadt. In the traditional plant in the Rhön, which
has been in existence for more than 70 years, in excess of two million floor care appliances
were produced for the first time in the year under review. In addition, BSH invested more than
EUR 5 million in 2011 in the location to ensure customer needs could continue to be fulfilled
optimally through innovations in technology and logistics. Despite international cost pressure,
the location is also equipped for the future thanks to its excellent flexibility and the commitment of the employees.
The trend products related to the consumption of coffee and hot beverages are especially
successful in BSH’s product portfolio. To continue to meet the ever-increasing demand in the
future, the company started up a new production line for fully automatic coffee machines in
Nazarje (Slovenia) and continued to expand development at the location.
The Electronic Systems and Drives division optimized and expanded capacities for motor
production at the Michalovce location. The performance of the logistical systems was increased in tandem with this. This allowed further increases in productivity to be achieved.
Construction of a new production hall in Nanjing was launched for expanding motor production
in China. Operation will commence here from 2012 in order to meet the increased demand of
the Product Area Laundry Care in China.
With more than two
million floor care
appliances, the traditional
plant in Bad Neustadt set
a new production record
in 2011.
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The practical application of the BSH Production System at all production locations remains the
focus. The implementation allows for continuous improvement in productivity and thus a
positive contribution to operating profit.
The linking of the core supply chain, procurement and production processes as an important
value proposition along the value chain should also be viewed in this context.
Thanks to BSH’s high
sales revenues the degree
of capacity utilization was
high – particularly in
Germany, Turkey and
China.
To take account of the increase in revenue in the year under review and the planned future
growth, the Group increased its capacities accordingly worldwide. The companies in growth
regions such as China and Russia, but also in Germany, Slovakia and Spain, will profit from
this in particular.
In addition to the sharp increase in production performance, the high turnover of the Group
also resulted in significantly increased output as well as a capacitive utilization at a high level
– in particular in Germany, Turkey and China.
In the year under review, the Group was also able to benefit from the continued high quality of
its products and lower warranty costs. Key factors for this success include stable processes,
the further progressive implementation of the BSH Production System and the use of improved
methods for early detection of errors. As a result, numerous new launches could be brought to
market again without negatively impacting the failure rate. In cooperation with customer
service, processes for feedback from the market were refined and customer-driven solutions
were introduced in customer support.
Supply chain management
Supply Chain Management focused in 2011 on sustainable use and safeguarding the stability
of the processes, while also focusing at all times on their enhanced development.
An integral tool of BSH for structured planning and implementation of training programs in the
supply chain network was created with the SCM Compass for Qualification. The aim is to
ensure Group-wide transparency of uniform knowledge standards in relation to the supply
chain processes. The required knowledge transfer is assured through a comprehensive training
concept and the resulting measures derived from this.
Supply Chain Management in 2012 will focus on increasing process security and stability.
Capital expenditure on property, plant and equipment
and intangible assets (excluding goodwill)
Capital expenditure
Capital expenditure by the Group in property, plant and equipment and intangible assets
(excluding goodwill) climbed by EUR 50 million over the previous year to EUR 453 million in the
year under review, which equates to 4.7 percent of consolidated revenue.
in EUR million
2011
2010
453
403
Of the capital expenditure on property, plant and equipment and intangible assets, EUR 148
million or approx. 33 percent is attributable to Germany and EUR 305 million to other countries.
BSH invested in production facilities in Germany for new energy-efficient refrigeration appliances, in the introduction of new products and product platforms for cookers, dishwashers
and laundry care as well as for vacuum cleaners. There was significant expenditure on new
development buildings in Dillingen, Giengen and Traunreut and for the new technology center
in Berlin. In addition, expansion of information technology was driven forward.
DEVELOPMENT OF BUSINESS | GROUP MANAGEMENT REPORT
Capital expenditure outside Germany focused primarily on factories in Turkey, China, Spain,
Russia and Poland. In addition to capacity expansions, investment was made at these locations in infrastructure and the development and expansion of the manufacturing of new
products, particularly for the Product Areas Laundry Care and Refrigeration.
Of the capital expenditure, 32 percent can be attributed to new products and 20 percent to
expansion and rationalization. Expenditure for infrastructure projects – including land,
buildings, logistics, information technology and environmental protection – amounted to
35 percent while 13 percent was spent on value retention.
Finance
The continuing debt crisis in Europe and the United States caused great turmoil in the financial
markets during the year under review. The uncertainty of market participants led to a very high
volatility.
The well-proven risk-adjusted investment strategy of the Group was also applied in the year
under review. Given the difficult market environment, BSH still achieved a satisfactory investment performance, managing to limit the slight fall in the value of the portfolio to a negative,
but low single-digit percentage range. The financial assets and other fund assets cover
pension liabilities at the cutoff date by nearly 100 percent.
During the year under review, current and non-current financial liabilities increased by a total
of EUR 518 million. This is due largely to an increase in bank loans in China amounting to EUR
279 million to finance local growth strategy while diversifying the financing mix, consisting of
alternating financing, bank loans and an offshore renminbi bond launched by BSH-D in Hong
Kong. The bond for a total of CNY 2 billion (EUR 229 million) was issued in three tranches of
three, five and seven-year terms. The bond proceeds were made available as funding to the
Chinese subsidiaries of BSH on the basis of appropriate agreements with identical maturities.
With the granting of an additional low-interest loan amounting to EUR 300 million, of which the
first tranche of EUR 150 million was paid out in late 2011, the European Investment Bank (EIB)
is supporting BSH projects in Germany to develop energy-efficient home appliances. Utilization of the second tranche of the same magnitude is planned for spring 2012. The Group like­wise expects financing expenses significantly below market interest rates for the second part
of these financial liabilities. The profitability of the borrowings gives the Group additional
scope for the future for investment in the development of resource-saving products.
In order to hedge financial risks, BSH uses a broad range of appropriate treasury methods.
A global treasury control unit in the Group ensures that all treasury risks are monitored,
identified and measured. Necessary control measures are initiated in a timely manner as
a result.
Especially in the major markets of Poland and Turkey, the Group was exposed to translational
currency risks in the year under review. About 60 percent of operational hedges in the year
under review were attributable to the currency risks of the Russian Ruble, the British Pound
and the Turkish Lira.
As part of the growth
strategy in China, BSH
issued an offshore
Renminbi bond in Hong
Kong in the order of CNY 2
billion.
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46
The currency risks from operative business are identified and measured in a rolling process
with a planning timeframe of one year as part of a defined hedging strategy. Identified ex­
posures are hedged, where necessary, with the help of derivatives. The centrally defined
hedging policy of the past was also pursued in the period under review.
BSH hedges the cash flows in British Pounds, Swiss Francs and Polish Zloty on the basis of
Cash Flow Hedge Accounting at Group level.
The Group limits the credit and liquidity risk by means of effective central cash management,
access to lines of credit provided by prime-rated banks and a Syndicated Loan Facility primarily entered into for contingencies. A key objective is to ensure financial flexibility and avoid or
reduce inappropriate refinancing risks. To limit the interest rate risk and to create opportunities, the Group has for many years been using the medium and long-term financing options in
the market at favorable rates.
In August 2011, the rating agency Standard and Poor’s affirmed the long-term rating of “A” and
the short-term rating of “A-1” for BSH. The outlook was rated as “stable”, based on the high
and stable operating results and cash flows and due to the moderate debt ratio. This underlines the outstanding credit rating of BSH.
Human resources and social issues
As at December 31, 2011, BSH employed a total of 45,620 people worldwide, including apprentices (2010: 42.841). Of this total, 30,811 (2010: 28,647) were employed internationally and
14,809 (2010: 14,194) in Germany.
Number of employees
2011
2010
45,620
42,841
Workforce by region (as of December 31, 2011)
Germany 32%
Asia 24%
North
America 3%
Latin America 1%
Western
Europe 18%
Eastern Europe 22%
exluding Germany
including Turkey
Especially in China, Turkey, Germany and
Russia, the Group increased its workforce in
the year under review. Additional staff were
employed – to a lesser extent – in Poland,
India and Slovenia.
A slight downsizing took place in the USA,
Greece and Slovakia.
In the development divisions of BSH-D, more
than 850 employees work in highly skilled
technical roles; in 2011 alone more than 110 additional employees were hired.
The opening of the new
Technology Center for
Laundry Care in Berlin
completed the futureoriented change from
manufacturing to
developing appliances.
The forward-looking change from manufacturing to development location in Berlin was
successfully completed with the opening of the new Technology Center for Laundry Care in
2011. BSH employs 246 engineers in this technology center, including the 44 employees newly
recruited in the year under review.
806 people were in apprenticeship contracts as at December 31, 2011. Of these, 447 apprentices and “DH” (dual university) students as well as 30 trainees were employed in Germany.
Of the 447 apprentices, 361 were training for industrial and technical careers, while 86 were
undertaking commercial training. The participants of the international trainee program come
from six different subsidiaries.
DEVELOPMENT OF BUSINESS | GROUP MANAGEMENT REPORT
BSH is countering the demographic changes in industrialized countries through the strategic
expansion of international talent management and the strengthening of diversity activities.
The Group is thus taking on the increasingly tougher global battle for brainpower.
Owing to this strategic importance, Diversity Management was amalgamated into a separate
department within the Corporate Human Resources division in 2011. Dimensions such as
internationality (ethnic origin), gender (gender diversity) and age (demographics) are the focal
points in this regard.
For several years, BSH has been responding to demographic changes with an enterprise-wide
initiative. This includes measures such as ergonomic workplace design, optimization of
assembly lines and activities in the area of occupational health management.
BSH is pursuing a series of sustainable activities both for ensuring succession and for staff
development. For example, the Group further intensified employer branding in the year under
review and again successfully competed for the “Top Employer in Germany” award (6th place)
as well as the “Top Employer for Engineers” award (4th place) run by the CRF institute. At the
same time, activities for using social media channels, for example for recruiting, were initiated.
In 2011, BSH has again
been ranked by the CRF
Institute as “Top Employer
Germany” and “Top
Employer for Engineers”.
Through the medium of the “Wege zur BSH” (Ways to BSH) brochure, the Human Resources
division provides information on attractive job opportunities for schoolgoers, students and
graduates and also shows how BSH as an employer and training company fulfills its social
responsibility and simultaneously stimulates enthusiasm among young people for the company by using targeted measures.
Activities at universities collaborating with BSH throughout Germany were further intensified
as part of the university marketing drive. Attendance at various college fairs continued to
expand. In addition, the student retention program “students@BSH” was launched. As well as
attending school information days, BSH organized the annual “Girls’ Day” in order to set up
and intensify contact with younger students. In the framework of the project “FOCUS macht
Schule” (FOCUS at school), the Group is cooperating with the news magazine FOCUS and
providing educational materials on various topics, such as sustainability and product design.
Also in 2011, the focus was on developing the international talent management processes. In
this context, the annual performance appraisal interview with statements about competence,
potential and training needs of staff was readied for further international roll-out.
Numerous events were again organized in 2011 for the members of the talent pools and
programs.
A new training program is being offered for the approximately 600 members of the “Junior
Executive Pool” (JEP) called “JEP Crossing”. In a pilot event with about 50 members, an active
exchange took place between the members as well as with representatives of the department
units. The aim of this event is the international networking of information and discussion on
strategic issues at BSH.
The promotion of international talent as well as cross-country and cross-divisional networking
was again the objective of the annual meeting of the “International Executive Pool” (IEP),
which has roughly 100 members.
The “Senior Executive Program” (SEP) for participants from senior management ranks at BSH
was continued with great success. 2008, the first year of this program, was concluded with a
closing ceremony in early 2011. In the three years of membership of SEP, nearly 90 percent of
these participants have taken on a different role in the Group.
The first class of the
“Senior Executive
Program” graduated in
2011. During the triannual
leadership program
almost 90 percent of the
participants assumed
a new position in the
enterprise.
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48
The “Project Management” career path was implemented for product projects at all locations
in Germany and in the meantime in the subsidiaries in China, France, Spain, Turkey and the
United States. Moreover, projects with IT involvement were also included in Germany.
The steadily increasing number of employee deployments worldwide supports the global
growth of BSH. At the cut-off date, 325 employees were working abroad for BSH. Compared to
2010, assignments between foreign subsidiaries in particular increased by nearly 50 percent.
The BSH Academy Corporate offers training programs for professionals, managers and junior
staff of BSH. BSH employees are being used increasingly as internal coaches for the training
programs. They are prepared for their task by specially developed train-the-trainer programs.
It is therefore possible to provide training on specific fields of knowledge of BSH. The BSH
Academy offer is available to all BSH employees worldwide. Aimed at the business and growth
strategy, the “Corporate Learning Landscape” is managed internationally by six major BSH
Academies (Germany, China, Poland, Spain, Turkey, USA). These ensure the integration of
countries with a smaller BSH presence (“lead country concept”) by means of a regional
structure.
BSH offers a special training program for all managers worldwide. The positive development of
leadership ability at BSH, which is also visible in the results of employee surveys, is not least
due to the continuous training of managers. For the past eleven years, BSH has been operating
its own training center at Kloster Zangberg. The BSH Academy Corporate organizes about 80
percent of training in Germany here.
The employee survey as a tool for organizational development is now well established internationally and was carried out in 23 countries in 2011. The participation rate of 84 percent on
average across countries shows a high acceptance among both managers and employees. In
Germany, the good results ​​from the previous survey were maintained at a high level and even
strengthened in part. Newly included issues such as compliance and sustainability were rated
as excellent across the Group. Managers and employees elaborated appropriate measures in the
wake of the widespread communication of the survey results, for which a monitoring tool is
now also available internationally for documentation and tracking purposes. This also allows
best-practice sharing across location and country boundaries.
The feedback instruments are widely accepted in BSH and contribute to the improvement of
leadership and cooperation. As a result of the 2009 employee survey, 42 percent of managers
in Germany have to date carried out the “Feedback for Executives”. Internationally it was
deployed in Poland, Russia, the Netherlands, Slovenia and Spain. The morale barometer
anchored in the BSH Production System is used as a feedback instrument in the factories.
DEVELOPMENT OF BUSINESS | GROUP MANAGEMENT REPORT
Information technology
Implementation of the strategic platform for business processes, weBSH.net, continued during
the year under review with system deployments in the BSH companies in Great Britain, Italy,
Switzerland and Slovenia. Coverage of European BSH companies on the basis of weBSH.net is
thus largely completed.
Moreover, the conditions for the adoption of weBSH.net in the overseas BSH regions were also
fulfilled. Platforms for software development were standardized in this context and the SAP
systems updated to the latest release level. The project work for implementing weBSH.net in
the subsidiaries in China, Australia and New Zealand commenced on this basis.
The progressive development is leading to ever more powerful, integrated and process-wide
information systems, which will provide global, location-independent access via different
terminals. This gives rise to ever increasing demands on safety and security of information.
To meet these challenges, BSH initiated a project for managing risks relating to information
security.
Cost, delay and technology risks in major IT projects are recorded and monitored by project
management and – if necessary – by a Project Risk Manager, a Project Management Office or
a Program/Project Office.
Corporate responsibility
Sustainability is an integral part of the corporate strategy and business model of BSH. The
principles of our mission statement represent the starting point for this strategy.
The Corporate Responsibility (CR) division has been responsible since the beginning of 2011
for the topic of sustainability at Group level which is a focal point of the Group.
The CR Committee is the appropriate group-wide decision-making body for the sustained
positioning and orientation of BSH. The management and implementation of the critical mea­
sures defined at Group level are likewise the responsibility of the committee. The necessary
sustainability objectives for the Group are defined in the business plan with concrete actions.
BSH has defined customers and products, companies and employees as well as society and
environment as areas of activity that were derived from the mission statement within the
scope of corporate responsibility. Specific approaches in the fields of action include the
super-efficient products portfolio, resource efficiency in production, strict adherence to social
and ethical standards in all stages of the value chain as well as diversity management and
forward-looking retention of young talent.
In the year under review, BSH published its “Environmental and Corporate Responsibility
2010” report, the nineteenth report of its kind. This sustainability report focused on the new
Corporate Responsibility division and the topics of energy efficiency in consumer products
and forward-looking work systems for employment of older workers. In addition, new and
environmentally-friendly logistics concepts were presented for the transport of finished
products.
Sustainability is an
integral part of the
corporate strategy and
business model of BSH.
The department of
Corporate Responsibility
was created in January
2011. It is responsible for
the issue of sustainability
on the corporate level.
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50
Environmental protection
Energy and resource efficiency in production and in relation to products was the focus of BSH in
the area of environmental protection in the year under review.
With the initiation of the Group project “Resource Efficiency 2015”, BSH set itself very ambitious
goals last year. Among other things, the production-related, specific consumption of energy and
water – relative to the base year 2010 – will be reduced by 25 percent up the end of 2015. Under
the supervision of external scientific and technical consultants, significant savings were
identified in the framework of pilot projects in such diverse fields as lighting, compressed air,
plastics, air conditioning, ventilation systems and optimization of production systems. The
objectives set as part of the Group project are to be fulfilled in individual projects in the coming
years through implementation of defined measures.
BSH was honored in 2011
by the German Government and the German
Chambers of Industry and
Commerce (DIHK) as a
“Climate Protection
Company”.
Due to the outstanding achievements in the area of climate protection, BSH was honored in
2011 by the German Government and the German Chambers of Industry and Commerce (DIHK)
as a “Climate Protection Company”. This was accompanied by the inclusion of the company in
the “Climate Protection and Energy Efficiency Group of German Industry”.
Regarding the energy efficiency of the Group’s products, numerous innovations in the year
under review led to significant improvements in energy consumption. Even before the mandatory application of the labeling of white goods with the new energy label as prescribed by the
European Union with effect from the end of 2011, BSH already had washing machines, cooling
appliances and dishwashers of the highest energy efficiency class A+++ in its portfolio.
The U.S. Environmental Protection Agency (EPA) awarded BSH U.S. the “ENERGY STAR Sustained Excellence Award” for the Bosch brand. This highest award was in recognition of the
contribution to increasing environmentally friendly usability and reduction in greenhouse gases
by reducing energy and water consumption of dishwashers and washing machines.
This year, BSH was for the first time awarded the prestigious Hermes Award by the European
Institute for Creative Strategies and Innovation in Paris in the category of “improving the human
relationship with nature”. The jury commended the Super Efficiency Portfolio of BSH in this
context. This portfolio combines the most economical and environmentally friendly equipment
for all product categories of BSH and thereby positions the Group as a leader in this market. The
products occupy leading global positions in energy efficiency and resource conservation.
Super-efficient fridge-freezer combinations consume up to 73 percent, dishwashers up to 50
percent and washing machines up to 38 percent less power than comparable units 15 years ago.
The most energy-efficient tumble dryer with heat pump technology is 60 percent below the limit
of the energy-efficiency class A and consumes nearly 70 percent less power than comparable
appliances 15 years ago.
Also in 2011, the accounting firm Deloitte & Touche again awarded a certificate to selected
indicators of BSH’s Super Efficiency Portfolio following an audit review.
The criteria used were the new regulations of the EU energy label. The sales share of superefficient appliances in BSH’s product portfolio amounted to 28 percent in the year under review.
This corresponds to sales of 3.5 million appliances and, calculated over the useful life, leads to
electricity savings of 1.9 billion kilowatt hours. This is equivalent to the average annual electri­
city consumption of more than 525,000 private households in Germany.
DEVELOPMENT OF BUSINESS | GROUP MANAGEMENT REPORT
Regulations governing energy management were integrated in the group-wide environmental
management system in the year under review. Investments in energy-efficient production
processes and projects in the context of energy efficiency programs resulted in a decline in
demand for energy and water despite increased numbers of appliances. The environmental
protection figures for energy and water consumption thus improved considerably beyond the
targets. No further reductions could be achieved however (see chart) in relation to waste
volumes from the factories, which is mainly due, in terms of quantity, to steel scrap and
packaging material. The recycling rate of these materials is in excess of 90 percent however.
In the year under review, a total of 37 of the Group’s 42 production facilities were certified under
ISO 14001, the international standard for environmental management systems.
BSH spent EUR 20 million on environmental protection at the locations in the year under review,
which included ongoing expenses in addition to capital expenditure.
Additional information about environmental protection within the Group and at our international
production facilities is available on the Internet.
Environmental figures for production
593
650
81.6
80.3
1.23
1.10
38.7
31.8
2011 2010
20112010
2011 2010
20112010
Energy per ton
Product
(kWh/t Product)
Waste per ton
Product
(kg/t Product)
Water per ton
Product
(m3/t Product)
CO2-emissions per ton
Product*
(kg/t Product)
* Excluding proportion from electrical energy generation, district heating and transport
Significant developments
In order to meet the exceptionally high demand for refrigeration appliances in China, property
rights were acquired in December 2010 in Chouzhou to expand the existing production capacities. Construction of the second refrigeration plant commenced in March 2011.
To finance the innovations and capital expenditure as well as the growth in the Chinese market
in the long term, BSH issued a bond of the order of CNY 2 billion (EUR 229 million) in September
on the offshore renminbi market in Hong Kong, which is significantly less expensive for funding
than short-term bank loans in China. The tranches of the bond feature coupons of varying rates
and maturities.
In the year under review,
a total of 37 of the Group’s
42 production facilities
were certified under ISO
14001, the international
standard for environmental management systems.
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As part of its expansion strategy in Asia, BSH founded a company based in Mumbai mid-2011,
which will commence production of laundry care and cookers at a later date. In the first quarter
of 2012 this new company will take over the sales and service activities from the sales company
that has already been active in India for a number of years.
In addition to the project business previously operated by a distributor in South Korea, BSH
founded a subsidiary in Seoul mid-2011 with the goal of promoting the sales activities for
consumer products in the South Korean market.
To operate the sales activities in South East Europe more intensively and independently, the
existing sales offices in Bulgaria, Croatia and Serbia were converted in November 2011 to
subsidiaries under national law.
Since 2010, BSH has
been shifting its freight
transportation from road
to rail. This commitment
was officially recognized in
December 2011 by the
German Emissions Trading
Authority (DEHSt) as a
climate protection project.
Based on this confirmation, BSH will be awarded
CO2 certificates in the
future.
Due to a specific event in the second half of 2011, BSH made the lasting experience that special
care and caution are needed in dealing with stakeholders on the topic of social media.
In November of the financial year, the foreign-run finished goods warehouse of the Russian
distribution company in the vicinity of Moscow burned down completely. The resulting initial
delivery problems and replacements constituted significant challenges. The Group managed
to compensate for the backlog of orders within a short time though with great effort.
The corporate strategy of BSH to work in all areas of the value chain in an optimally environmentally-friendly and resource-efficient manner, was expanded to include logistics. In the framework of the “BSH Transportation Shift Project” commenced in 2010, BSH has been shifting its
freight transportation from road to rail in order to make the goods transport more environmentally friendly and reduce carbon dioxide emissions. This commitment was officially recognized
in December 2011 by the German Emissions Trading Authority (DEHSt) as a climate protection
project. Based on this confirmation, BSH will be awarded CO2 certificates in the future. The
project will be considered under the Kyoto Protocol as a flagship project.
N E T A SS E T S , F I N A N C I A L P OS I T I O N A N D R E S U LT S O F O P E R AT I O N S | G R O U P M A N AG E M E N T R E P O R T
Net Assets, Financial Position and Results of Operations
Results and key influencing factors
In the difficult year under review 2011, the Group exceeded its sales expectations and achieved
consolidated revenue of EUR 9.654 billion, representing an increase of 6.4 percent over the
previous year. The unfavorable exchange rate movements – primarily because of the Turkish
Lira – negatively impacted the consolidated revenue to the order of 1.6 percent.
Compared to 2010, the cost of sales increased by 8.3 percent. The structural increase by about
one percentage point was due mainly to higher prices in the commodity markets and exchange
rate influences.
Due to counteracting factors, such as improved production processes, the Group achieved a
positive gross margin of 37.1 percent of revenue, despite the unfavorable procurement oppor­
tunities compared with the previous year.
During the year under review, a total of EUR 2,582 million was spent on sales and administration, corresponding to a share of 26.7 percentage points of revenue.
The growth offensive in Asian and Eastern European countries, challenging competition in
highly competitive markets such as Eastern Europe and China and the efforts of BSH to expand
its market share went hand in hand with measures to increase market penetration in resourceefficient household appliances. These activities led to an increase in selling expenses.
Administration costs amounted to EUR 562 million and accounted for 5.8 percent of revenue,
compared to 5.6 percent in the year before. The increase is due primarily to higher personnel
costs due to the expansion of the workforce last year in various corporate functions and the
development of personnel costs, including allocations to provisions during the year under
review. Furthermore, the change also resulted to a minor extent from the increased economic
transparency through the introduction of the weBSH.net system in additional subsidiaries.
These standardized system processes lead to the harmonization and improvement of the
cause-specific allocation of functional expenses.
As in previous years, BSH again increased its spending on research and development, which
rose by 7.6 percent during the year under review. Measured in terms of revenue, the share
amounted to 3.1 percent as in the previous year.
Other operating income increased significantly by EUR 50 million with an improvement in the
sales ratio to 3.7 percentage points. In contrast, other operating expenses decreased slightly
to EUR 357 million.
The net comparison with the previous year shows surplus revenue of EUR 9 million from the
allocation and reversal of non-function-related provisions. Expenses exceeded revenues by
EUR 68 million during the year under review in the comparison of the allocations and reversals
of these provisions.
Other operating income was recorded in respect of infringement of industrial property rights.
Provisions are recognized for pending legal disputes on the scale deemed necessary at the
time of recognition to cover expected consumption. Although the Group essentially considers
the claims made to be unjustified, liabilities over and above this also cannot be ruled out
completely.
Augmenting commodity
prices and negative
effects from currency
translation resulted in an
increase of production
costs by 8.3 percent in
the finanical year 2011.
53
54
As part of the Field Action for dishwashers in the U.S. and for sales of hot beverage systems,
existing provisions were revised in accordance with the expected claim.
Existing provisions for sales risks were reduced due to lack of utilization and updated estimates.
The external tax audit for the tax years 2003 to 2006 was completed in the year under review
and led to a significant expenditure for the year under review. Further burdens resulted from
sales activities and rendering of services both in Germany and abroad, and allocations as well
as utilizations of provisions were made. Additional areas for action were examined and ana­
lyzed in relation to other sales-related activities with the involvement of external consultants.
However, as the present state of knowledge does not allow a reliable estimate to be made,
provisions were not allocated.
An appropriate adjustment was made on the cut-off date following a review of the provision for
wage tax.
Furthermore, derecognitions affecting the net result resulted in the year under review due to
lack of utilization as well as other minor allocations or reversals of various provisions.
As in previous years, BSH accordingly recognized necessary financial precautions at the cut-off
date at all Group companies for known risks and other exposures.
Appropriate individual value adjustments were made for trade accounts receivable as well as
with respect to suppliers.
As a result of necessary value adjustments in accordance with IAS 36, the income statement
was significantly burdened due to the regular review of assets.
The valuation of financial assets under IAS 39 resulted in a significant impairment loss in the
financial year. The regulations on necessary write-downs to fair value were complied with.
The balance of gains and losses from foreign currency derivatives amounts to a net gain of
EUR 7 million. This includes the internal hedging transactions in subsidiaries with the parent
company. The latter in turn combines the hedging transactions of the Group on the external
market. This gives rise in the financial year to a positive change in comparison with the
previous year’s result.
The measurement and
realization of trade
receivables and payables
in foreign currency
resulted in a profit of
EUR 11 million.
The measurement and realization of trade receivables and trade payables denominated in
foreign currency resulted again in the period under review in a profit of EUR 11 million following
a positive result the year previously. The profits of EUR 109 million exceeded the losses, which
amounted to EUR 98 million.
This clearly demonstrates the success of the hedging strategy at BSH. Overall, the comparison
of profit and loss from foreign exchange derivatives or realizations and measurement of foreign
currency trade receivables and payables gave rise to a considerable gain of EUR 18 million
during the period under review.
N E T A SS E T S , F I N A N C I A L P OS I T I O N A N D R E S U LT S O F O P E R AT I O N S | G R O U P M A N AG E M E N T R E P O R T
The remaining operating results are only slightly affected by a major incident in Russia and its
insurance repercussions. Other operating income is likewise also affected by insurance
payments and reimbursements for losses in the U.S. and by foreign currency conversion
differences in relation to the Turkish Lira and the Russian Ruble.
A year-on-year comparison shows a considerable additional expense of EUR 46 million on the
net of finance income and finance cost. The finance cost clearly exceeds the finance income
in this case by EUR 109 million. The movement in the expense is attributable to the issue of
offshore renminbi bonds in Hong Kong to finance the net working capital in China as well as
international sales activities and the funds raised from Chinese and European banks for
planned innovations, capital expenditure and growth.
In the year under review, BSH for the first time reported the interest components of obligations
for pensions, retirement and anniversaries, which were previously shown under personnel
costs, in the net interest result rather than in the operating results. The net finance result
includes a reclassification of EUR 47 million for the interest expense and income of external
plan assets, compared with EUR 51 million the previous year. Prior year comparatives are
illustrated and explained in detail in the Annex.
Other net finance cost amounts to EUR 46 million and is therefore significantly above that of
the previous year. The change is mostly due to the losses on financial assets.
In the year under review,
BSH for the first time
reported the interest
components of obligations
for pensions, retirement
and anniversaries, which
were previously shown
under personnel costs,
in the net interest result
rather than in the opera­ting result.
Earnings before income tax amounted to date to a very positive EUR 538 million for BSH.
Compared to last year, this is especially true considering the material cost increases in the
financial year and significantly increased market, competition and sales activities within the
framework of future-oriented growth strategy.
The tax on profits in the Group amounts to EUR 164 million (2010: EUR 224 million) and
includes the allocation to provisions for tax of EUR 23 million. This corresponds to 1.7 percent
in terms of revenue compared to 2.5 percent the previous year. Following the netting of deferred tax of EUR 164 million, the total income tax charge comprises only current tax.
The percentage of German tax as a proportion of current tax amounted to 29.3 percent in the
year under review. Current tax on profits from abroad declined year on year by EUR 27 million
to EUR 116 million.
The Group tax rate was 30.5 percent compared with 32.5 percent the previous year.
Net profit amounted to EUR 374 million or 3.9 percent of revenue.
Following deduction of minority interests, Group profit amounted to EUR 373 million compared
with EUR 465 million the previous year.
Group profit (IFRS)
in EUR million
2011
2010
373
465
55
56
Statement of cash flow
Compared to 2010, cash and cash equivalents decreased by 11.1 percent. Reasons for this
include cash outflows from operating activities and investing activities that exceed the cash
flow from financing activities.
These deviations are due mainly to changes in results before income tax and to fewer negative
effects in the development of inventories. In addition, a strong increase in trade accounts
receivable and a slight year-on-year change in short-term liabilities and provisions must also be
taken into account.
Lower cash outflows from investments in property, plant and equipment, intangible assets and
securities are offset by higher proceeds from the sale of finance receivables and the sale of
securities.
In relation to cash flows from financing activities, cash flow-promoting effects result from the
juxtaposition of the borrowing and repayment of financial liabilities and cash outflows from the
distribution to shareholders.
While exchange rate fluctuations in relation to cash and cash equivalents were slightly positive,
no consolidated group-related factors were considered.
Overall, the cash and cash equivalents changed therefore during the year under review to
EUR 511 million.
Assets
Total assets increased by EUR 534 million year-on-year to EUR 7,435 million.
In relation to non-current
assets, the increase in
fixed assets was broadly
balanced by the reduction
in non-current financial
assets.
The changes in current assets were mainly due to the increase in trade receivables. Stocks and
bonds were also involved to a minor extent.
By contrast, cash and cash equivalents and other current assets declined. In relation to noncurrent assets, the increase in fixed assets was broadly balanced by the reduction in noncurrent financial assets.
Market and competition-oriented activities and related revenue increases – mainly in Asia and
in Eastern Europe and Turkey – justified the considerable increase in trade accounts receivable
to EUR 2,259 million, corresponding to 30.4 percentage points of total assets.
Assets: Structure in %
2011
2010
7
30
8
25
Cash and cash equivalents, securities
Trade accounts receivable
18
Inventories
39
Fixed assets and non-current
financial assets
10
Other assets
18
36
9
7,435
6,901 Balance sheet total (in EUR million)
Due to changed conditions, there has been no
complete transfer of economic risk on discounting bills of exchange receivable in China since
2011, with the result that there was no write-off
of the bills in the balance sheet. The Group
therefore presented the bills of exchange
receivable (EUR 92 million) during the year
under review both as trade receivables and current financial liabilities. Bills of exchange
receivable of up to EUR 338 million were
presented for discount last year.
N E T A SS E T S , F I N A N C I A L P OS I T I O N A N D R E S U LT S O F O P E R AT I O N S | G R O U P M A N AG E M E N T R E P O R T
Other current assets decreased to EUR 379 million primarily due to a decrease in other receiv­
ables from third parties.
Due to the expansion of sales in the year under review and the planned further increase in 2012
as well as the maintenance of high standards by BSH in relation to delivery performance, there
was an increase in inventories by EUR 79 million to EUR 1,305 million. Measured against the
share of total assets, inventories were slightly down on the previous year.
Capital expenditure on property, plant and equipment at BSH amounted to EUR 436 million.
The effect of currency fluctuations not affecting income on acquisition and manufacturing costs
amounted to EUR 43 million. The disposals in the year under review amounted to EUR 130
million.
Depreciation and impairment in the financial year on property, plant and equipment amounted
to EUR 144 million. While the additions for the period under review came out at EUR 270 million,
negative currency changes of EUR 24 million had to be taken into account. The impairment of
assets amounted to EUR 11 million.
Net capital expenditure was made in property, plant and equipment in the financial year to the
order of EUR 119 million.
The carrying values of intangible assets decreased to EUR 237 million. This was attributable in
particular to currency changes in relation to purchased intangible assets, almost exclusively
goodwill.
Overall, the changes in consolidated assets amounted to EUR 95 million.
Deferred tax assets changed year-on-year by EUR 10 million to EUR 204 million (2010: EUR 194
million) following write-downs on tax loss carryforwards, tax credits and temporary differences.
The domestic share was EUR 48 million while EUR 103 million was attributable abroad. Consolidation effects gave rise to EUR 53 million.
Liabilities
The amount reported for current and non-current liabilities increased by a total of EUR 533
million to EUR 5,026 million. This is 2.5 percentage points of total assets more than the comparable figures for the previous year.
This is mainly due to changes in the debt owed, which represent a significant increase at EUR
518 million. In terms of content, this can be attributed to the issue of an offshore renminbi bond
in Hong Kong and loans taken out to finance innovation, capital expenditure and growth and the
initial gross reporting of discounted bills of exchange receivable in China.
Trade accounts payable and other current liabilities amounted to EUR 2,173 million on the
cut-off date. This represents an increase in liabilities of EUR 112 million and a share of total
assets of 29.3 percent (2010: 29.9 percent); this is attributed by more than two thirds
to trade payables. However, the proportion of total assets is slightly below the previous year.
Due to the expansion of
sales in the year under
review and the planned
further increase in 2012
as well as the maintenance of high standards
by BSH in relation to
delivery performance,
there was an increase in
inventories by EUR 79
million to EUR 1,305
million.
57
58
Pension obligations are
covered nearly 100
percent by asset values
and other fund assets.
The current and non-current provisions – including pensions and other post-retirement benefits
– amount to EUR 1,760 million and thus 23.7 percent of total assets. While the current and
non-current provisions were reduced, an increase in provisions for pensions and other postretirement benefits was recorded over the previous year. This translates on balance and
measured against the liabilities to a decrease of 3.2 percentage points.
The change in provisions for pensions and other post-retirement benefit obligations was
essentially due to the decrease in the discount rate by 0.2 percentage points to 4.5 percent
abroad. The interest rate remained constant at 5.3 percent however in Germany. The provision
for pensions rose by 5.1 percent to EUR 886 million. Appropriate coverage of pension obligations is provided by term deposits and short and long-term financial investments in the capital
market.
The deferred tax liabilities amounted as in the previous year to EUR 22 million and are accounted for by EUR 4 million from abroad and EUR 1 million from Germany as well as EUR 17 million
from the consolidation. Additions for “outside basis differences” at Group level are likewise
included here.
BSH’s equity is virtually unchanged at EUR 2,409 million. The biggest factors in the year under
review are primarily the consolidated net profit and the distribution to shareholders as well as
the differences arising from currency conversion.
Other changes relate primarily to movements in the revaluation reserve, which did not impact
profit and loss but caused changes in equity. These are especially unrealized gains and losses
on securities held for sale and the actuarial results according to the actuarial report in relation
to pension obligations. To a lesser extent, the change in the reserve to cover the floating cash
flow hedges should also be mentioned here.
Liabilities: Structure in %
2011
2010
15
15
Trade accounts payable
14
8
27
Financial liabilities
Provisions
15
Other liabilities
35
Equity
24
15
32
7,435
6,901 Balance sheet total (in EUR million)
M anagement of opportunities and risks | G R O U P M A N A G E M E N T R E P O R T
Management of Opportunities and Risks
Compliance management
The BSH Compliance Organization consists of the Corporate Compliance Committee, the Office
of the Compliance Committee as well as Regional Compliance Officers and Regional Compliance
Committees in 45 countries. An external ombudsman complements the internal organization.
In the year under review, the Office of the Compliance Committee was strengthened again
enabling the Committee to again intensify in particular its legal compliance work.
An important goal of preventive work on avoiding compliance violations includes among other
things providing all employees of BSH with a binding framework on behaving in a responsible
manner in accordance with the law. Group-wide and country-specific guidelines and regulations
based on this are made available for this purpose. In addition, a comprehensive training
program is available, complemented by targeted communication activities and ongoing advisory work.
Within this set of rules, the Business Conduct Guidelines specify minimum standards; these
guidelines contain globally uniform and binding rules on the conduct and business activities
of all employees of the Group. A revised version of the Business Conduct Guidelines was
published in 2011 and accompanied globally by comprehensive training and communication
activities. It is ensured worldwide that all staff undertake their duties in compliance with the
Business Conduct Guidelines and that executives also promote and monitor the compliance
of employees under their responsibility.
In all compliance instances, investigations are performed by the Compliance Organization – in
accordance with defined processes – and appropriate measures are taken.
As part of the employee survey conducted in 23 countries, questions concerning the perception
and establishment of compliance within the company were answered for the first time in the
year under review. The country-specific findings are incorporated into the work of the inter­
national Compliance Organization.
Risk management
The aim of risk management at BSH is to protect the Group from risks that would jeopardize its
continued existence and to ensure sustained business success. The Risk Management Com­
mittee finalized a new process overview of Corporate Risk Management for this purpose in the
year under review, which, in addition to Business Continuity Management, also includes crisis
management and risk reporting. Corresponding processes in the areas of procurement, sales,
finance and tax as well as project management ensure risk management in the business
activities.
Furthermore, an initiative began in the year under review to standardize and consolidate
regulations relating to Corporate Risk Management. New risk management processes can now
be seamlessly integrated into the revised main process and the rules of Corporate Risk Management. Due to the resulting synergies, Corporate Risk Management provides the basis for using
the room to maneuver for achieving an optimized Group-wide risk-reward ratio.
Group-wide and country­
specific guidelines are
made available to provide
all employees with a
binding framework for
behaving in a responsible
manner in accordance
with the law.
59
60
Due to the strong revenue growth, the Group continued to confront the issues of receivables
management and customer credit risk even more intensively in order to control the sales risks.
BSH uses various methods and processes for managing sales risks.
Due to the strong revenue
growth, the Group con­tinued to confront the
issues of receivables
management and customer
credit risk even more
intensively in order to
control the sales risks.
Customer-related credit risks are recorded and monitored in the framework of Group-wide
reporting. Potential individual risks and concentrations of risks in the case of major accounts
are identified in this way and controlled by the Corporate Credit Risk Committee using appropriate measures. It is therefore important for the Group to have adequate insurance coverage for
credit losses, which is subject to regular review and adjustment. This is especially true for
concentrated groups of customers of the Group.
In addition, the personal contact represents another instrument for recording the customer’s
actual situation and thereby further reducing the sales risk.
All claims arising from the German-speaking countries are subjected to strict monitoring in a
Shared Service Center in order to detect and prevent credit risks early on. In addition, each
subsidiary of the Group is responsible for managing claims and credit risks.
Special rules in relation to debt arrears allow targeted, timely and effective control of receivables
management.
The Risk Management Committee of BSH approved the orientation of the Group project for
Information Risk Security Management in the year under review. This project is intended to
include all critical information about the company. The Committee adopted the structure,
content and organization of the project under the direction of the Information Technology
department. In the context of four sub-projects, various topics will be dealt with in the coming
years. These include, in particular, the classification, risk assessment and action planning for
critical information. Other focal points include authorizations in IT systems, the creation of
awareness of information risks and the implementation of Information Security Risk Management processes.
The Tax Risk Management Committee of BSH is responsible for direct reporting of fiscal risks
to the Board of Management. Early detection of opportunities and risks is of special importance
in this context. Annual surveys and analyses in the context of a systematic, process-driven
approach ensure identification of risks in relation to ​​tax and duties.
A uniform and established fiscal reporting system for the subsidiaries, the Tax Workbook,
allows quarterly calculation of income tax of the Group. A close link with the accounting systems
supports a consistent way of working and uniform monitoring of results. Thanks to the increased
transparency, the recording, tracking and control of possible fiscal risks and opportunities will
be promoted.
According to their duration, the existing insurance contracts were reviewed and, if necessary,
updated in the year under review in relation to their content and scope of coverage.
The Transport Insurance Program applied group-wide in the BSH countries was further optimized
in 2011 in cooperation with a new insurance partner.
As a result of the positive claims experience, the Group can likewise point to improved con­
ditions for credit insurance.
M anagement of opportunities and risks | G R O U P M A N A G E M E N T R E P O R T
The cover provided for credit risks in BSH was also extended to other countries in 2011.
Regarding the reported receivables, there is no concentration of credit risk owing to a sufficiently diversified customer structure and the preventive measures.
In its operating business, BSH is subject to the risks of financing, currency and interest rate
movements and commodity markets, which are monitored and controlled in the context of the
operational activities in the areas of finance and procurement.
In conclusion, BSH is able to state that it is currently not aware of any risk that threatens the
continued existence of the Group as a going concern.
Opportunities and risks for future development
The Group has a differentiated view of the opportunities and risks regarding future sales and
profit figures for large and small home appliances in accordance with the overall economic
outlook. In line with the weaker economic development, further intensification of the challenging global competition is expected.
Future risks still exist, especially in the markets of mainly southern European countries severely
affected by the financial crisis.
Opportunities may also arise for BSH in Western Europe owing to its excellent positioning, and
customer acceptance and established market presence, however, this is against the background of an already well-developed market.
Opportunities also exist in the growth regions of Eastern Europe, particularly in the main sales
markets of Russia and Poland, but also – not least depending on currency – in Turkey.
Risks continue to exist in the North American market due to the very aggressive competitive
situation with destructive price competition in different segments. Additional opportunities may
also arise, however, due to the expected slight economic recovery in the coming year and the
measures taken in the past to clean up the segment.
The Latin American growth countries including Peru, Chile and neighboring countries, could,
accompanied by the economic outlook for the region, likewise offer opportunities for sales and
profits for BSH.
In Asia and Oceania, including notably China, India, Israel and Singapore, but also in Australia
and New Zealand, BSH sees significant opportunities for further success, though, according to
the projected lower growth in Asia, with less dynamic growth than in the past.
BSH is hoping for additional growth opportunities from new market activities and the significant
strengthening of its business in Southeast Europe and in Asia, especially China.
Opportunities also exist in
the growth regions of
Eastern Europe, particularly in the main sales
markets of Russia and
Poland, but also – not
least depending on
currency – in Turkey.
Future risks still exist,
especially in the markets
of mainly Southern
European countries
severely affected by the
financial crisis.
61
62
The worldwide trend towards customized solutions for the consumption of specialty coffees and
hot beverages as well as the excellent positioning of BSH brands and products in this segment
will continue to offer opportunities in the future for further success in terms of sales and profits,
not least in challenging markets such as the U.S. and Canada.
In the areas along the value chain, BSH sees opportunities through operational excellence and
high investment and through future successes of projects and initiatives already commenced.
In the areas along the
value chain, BSH sees
opportunities through
operational excellence
and high investment and
through future successes
of projects and initiatives
already commenced.
The intensive activities and extensive spending on research and development in relation to
improved products and innovative customer solutions, combined with the steady expansion of
global, market-oriented product development, form an essential basis for the continued
success of the BSH brands.
The procurement area is opening up future opportunities and additional contributions to
earnings through market-tailored, medium and long-term contracting as well as other bundling
activities, but also through the strategic use of commodity derivatives.
The progressive implementation and application of the BSH Production System and the ongoing
application of modern production processes provide additional opportunities to increase
efficiency. From the high level of capital expenditure on the renewal of production facilities and
the expansion of capacities, opportunities are offered to service the regionally increasing
market demand, to expand sales and increase profitability.
Due to the excellent positioning of BSH as a top employer as well as comprehensive staff-related
measures, BSH is countering the risks arising from the demographic development and the
consequent competition for qualified employees. In addition, the success of these activities
will also open up opportunities in future competition.
Activities in the area of Supply Chain Management will support and promote the business
success of BSH by intensifying interdisciplinary cooperation along the value chain. Future
savings will also continue to be enabled through optimization of the processes.
Through technology screening and the use of modern information technology and by adapting
and developing its own IT solutions, the information technology department will continue to
support the business and the success of the Group divisions as a successful partner and
creative director.
OUTLOOK | GROUP MANAGEMENT REPORT
Outlook
Events after the reporting date
In a letter dated March 09, 2012, Siemens AG terminated the name and trademark license
agreement of May 08, 2000 on December 31, 2012 to enable partial realignment of a seamlessly
following up successor contract to be negotiated. Management does not expect any impact on
the company as a result of this.
Overall economic outlook
The world economy finds itself in a difficult position at the beginning of 2012. The unresolved
debt crisis in Europe and the continuously worsening banking crisis are stifling global growth.
However, the industry proved to be quite resilient until recently. Possible risks of soaring oil
prices – should tensions exacerbate in the Middle East – now also have to be taken into
account.
BSH is anticipating a further slowdown in global growth in 2012. World trade will be affected by
this primarily and should only grow very slowly. The recent more favorable labor market data in
the U.S., the continued good labor market situation in Germany and the continuation of economic development in emerging countries are leading to an expectation of robust growth in
private demand, even if less dynamic than in previous years. The biggest single risk that BSH
foresees is in further exacerbation of the debt crisis in Europe. This would noticeably strain
growth in Europe in particular but also extend to other regions due to global interdependence.
Growth in gross domestic product of only 2 ½ percent is assumed for the world economy in
2012, which is well below the long-term average of 3 ¼ percent. Even if the emerging markets
again record above average growth in value added, the plus of just 5 percent would be noticeably lower than the long-term average of 6 ¼ percent. Growth in developed countries at 1 ½
percent on the other hand will be barely lower than in 2011. However, this is primarily due to the
development in Japan, where the reconstruction of the regions devastated by earthquake and
tsunami should give rise to a 2 ¼ percent increase in gross domestic product.
In Western Europe, however, the debt crisis and the slowing of world trade will only allow
modest growth of a half percent. As in the previous year, economic development in 2012 will
vary considerably at regional level. The value added in the southern European states will
therefore at best stagnate, but will shrink in most cases, however, sometimes significantly. The
Group is expecting further growth in Germany on the other hand. This should however remain
one percent behind the high growth rates of 2010 and 2011.
BSH rates the economic outlook for the USA as good. In particular, the recent improvement in
the labor market and the continuing robust growth of industrial production point to a continu­
ation of the economic recovery. However, the high public debt and the continuing high asset
losses in the private sector are dampening further development. However, the decision in the
United States to continue transfer payments agreed at the height of the financial market crisis
in 2009 is signaling that BSH’s expectation of an increase in economic output in the U.S. by only
2 percent may be cautious.
The emerging economies will continue again in 2012 to make the largest contribution to global
economic growth. However, the slower expansion of world trade and the declining support by
economic policy is slowing down development. Notwithstanding this, investment, particularly
in infrastructure, as well as private consumption, which is favored by the slowdown in inflation,
will continue to expand significantly. Later in the year, the dynamic in these countries should
increase again, as the economic policy has recently begun again to stimulate the economy.
Among the emerging markets, the most dynamic will again come from Asia. These Asian
countries at nearly 6 ½ percent will grow more than twice as fast as the emerging economies
in Latin America and Eastern Europe (each around 3 percent).
BSH is anticipating a
further slowdown in
global growth in 2012.
World trade will be
affected by this primarily
and should only grow very
slowly. Growth in gross
domestic product of only
2 ½ percent is assumed
for the world economy in
2012.
63
64
Outlook for the sector and Group
Against the backdrop of some very difficult overall economic conditions, the global market for
large home appliances will continue to develop differently at regional level.
The Western European market is expected to stagnate at best in 2012. BSH believes that the
German market will continue to grow at a slower pace, while the situation on the southern
European markets will remain tense. The majority of these markets are likely to shrink again in
2012. Further growth, although at a lower level than last year, is expected for Eastern Europe.
Growth drivers are likely to remain Russia and Turkey.
In the non-European markets, the North American market should recover slightly in 2012 and
remain at about the same level as last year. Both the Latin American market and the Asian
markets are likely to have a similar growth in 2012 as the year before.
The market for home appliances in China, which in the past recorded extremely high growth
rates of more than 20 percent at times, is not expected to reach these levels again. Despite
increasing challenges from the market and competition, BSH is expecting continued solid
market growth in 2012 similar to the previous year, with low growth rate increases in
the coming years.
BSH is setting itself sales
targets for the next few
years above those for the
year under review.
Against this background, BSH is setting itself sales targets for the next few years above those
for the year under review. Only when these goals are achieved, can the demanding expectations
for future financial results, which exceed those for the previous year, also be met.
Business performance at the beginning of 2012 is strengthening BSH’s expectation that revenue
and profit will be on a par with business planning for 2012. BSH also anticipates strong business performance in 2013.
The BSH Board of Management is not aware of any developments of any importance after the
balance sheet date that may significantly impact the net assets, financial position or results of
operations of the Group.
Munich, March 28, 2012
BSH Bosch und Siemens Hausgeräte GmbH
The Board of Management
KOLUMNENT IT EL | KOLUMNENT IT EL
| Consolidated Financial Statements
A sound financial position is the foundation for BSH’s sustainable
growth strategy, and we were able to preserve our comfortable
capital base in 2011. Our continued low gearing ratio means that
Standard & Poor’s has confirmed our outstanding company rating
with a stable outlook.
65| Consolidated Financial Statements
66 Consolidated Statement of Income
67 Consolidated Statement of
Comprehensive Income
68 Consolidated Balance Sheet
70 Consolidated Statement of Cash Flows
71 Consolidated Statement of Changes in Shareholders’ Equity
72 | Notes to the Consolidated Financial Statements
72 Accounting Policies
82 Notes to the Consolidated Statement of Income
87 Notes to the Balance Sheet
112 Consolidated Statement of Changes in Fixed Assets
65
66
Consolidated Statement of Income
January 1 to December 31, 2011
in EUR million
Note
2011
20101)
Revenue
4
9,654
9,073
Cost of sales
5
6,077
5,609
3,577
3,464
Gross profit
Selling and administrative expenses
6
2,582
2,357
Research and development expenses
7
298
277
Other operating income
8
353
303
Other operating expenses
8
357
363
693
770
60
53
Operating profit
Finance income
Finance cost
Other net finance income/cost
9
9
169
116
10
– 46
– 16
538
691
164
224
374
467
373
465
1
2
Profit/loss before tax
Tax on profits
11
Profit after tax
Of which attributable to
Shareholders of the parent (consolidated net profit)
Non-controlling shareholders
12
1
) Values after adjusting the reporting of interest expense and income from plan assets from pension, semi-retirement and long service bonus obligations. For further information see Notes 2.2 and 9.
CO NS O L I DAT E D S TAT E M E N T O F CO M P R E H E NS I V E I N CO M E | CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
Consolidated Statement of Comprehensive Income
January 1 to December 31, 2011
in EUR million
2011
2010
Profit after taxes
374
467
Gains and losses on translating foreign operations
– 77
85
Gains and losses on available-for-sale financial assets
– 25
10
– 5
2
– 29
– 53
Gains and losses from cash flow hedging instruments (CFH)
Actuarial gains/losses on defined benefit pension plans
and similar obligations
Income taxes relating to components of other comprehensive income
Other comprehensive income
Total comprehensive income
11
10
– 125
54
249
521
248
519
1
2
Total comprehensive income attributable to
The parent
Non-controlling shareholders
67
68
Consolidated Balance Sheet
January 1 to December 31, 2011
in EUR million
Note
31.12.2011
31.12.2010
Cash and cash equivalents
14
511
575
Securities
15
69
19
Trade accounts receivable
16
2,259
1,735
53
37
Other current assets
17
379
427
Inventories
18
1,305
1,226
4,576
4,019
ASSETS
Current assets
Current recoverable income taxes
Total current assets
Non-current assets
Non-current financial assets
19
763
891
Property, plant and equipment
20
1,655
1,536
Intangible assets
21
237
261
Deferred tax assets
11
204
194
Total non-current assets
2,859
2,882
Total assets
7,435
6,901
CO NS O L I DAT E D B A L A N C E S H E E T | CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
in EUR million
Note
31.12.2011
31.12.2010
SHAREHOLDERS’ EQUITY AND LIABILITIES
Current liabilities
Financial liabilities
22
471
288
Trade accounts payable
23
1,100
1,020
12
12
1,029
Current income tax liabilities
Other current liabilities
24
1,061
Other current provisions
24
465
489
3,109
2,838
580
245
Total current liabilities
Non-current liabilities
Financial liabilities
22
Other non-current liabilities
25
20
20
Other non-current provisions
25
409
525
Provisions for pensions and similar obligations
26
886
843
Deferred tax liabilities
11
22
22
1,917
1,655
Total non-current liabilities
Equity
Subscribed capital
27
125
125
Retained earnings and other reserves
27
1,903
1,798
373
465
8
20
Total shareholders’ equity
2,409
2,408
Total shareholders’ equity and liabilities
7,435
6,901
Consolidated net profit
Non-controlling shareholders
27
69
70
Consolidated Statement of Cash Flows
January 1 to 31 December 31, 2011
in EUR million
Note
2011
20101)
374
467
11
164
224
538
691
– 1
– 2
295
295
Profit after taxes
Income taxes
Profit before tax
Non-controlling interests
12
Depreciation, amortization and impairment of non-current assets
and reversals of impairment losses
Gains and losses on disposal of assets
Net finance cost
9
Finance cost paid
Finance income received
Income taxes paid
Other non-cash income and expenses
– 2
2
109
63
– 66
– 54
51
46
– 227
– 239
– 61
– 82
Change in assets and liabilities
Change in inventories
Change in trade accounts receivable and other accounts receivable
Change in trade accounts payable and other liabilities
– 82
– 140
– 608
8
51
324
Change in provisions
– 86
82
Change in deferred taxes
– 12
– 10
– 101
984
0
0
– 453
– 403
Net cash outflow (2010: net cash inflow) from operating activities
28
Payments for financial assets
Payments for investments in intangible assets
and property, plant and equipment
Proceeds from the disposal of assets
Additions to financial receivables
Decrease in financial receivables
Investments in securities (available-for-sale)
Disposal of securities (available-for-sale)
Net cash used in investing activities
28
Dividend payments
Non-controlling interests
Proceeds from borrowings
Repayment of financial liabilities
Net cash inflow (2010: net cash outflow) from financing activities
28
Net change in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
28
Change in cash and cash equivalents due to changes in exchange rates
Cash and cash equivalents at the end of the period
28
19
9
0
– 21
139
0
– 724
– 810
810
698
– 209
– 527
– 234
– 653
–12
7
1,195
111
– 706
– 103
243
– 638
– 67
– 181
575
742
3
14
511
575
1
) Values after adjusting the reporting of interest expense and income from plan assets from pension, semi-retirement and long service bonus obligations. For further information see Notes 2.2 and 9.
CO NS O L I DAT E D S TAT E M E N T O F C H A N G E S I N S H A R E H O L D E R S ’ EQ U I T Y | CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
Consolidated Statement of Changes in Shareholders’ Equity
January 1 to December 31, 2011
mp a
t co
are n
- co
in te n t r o l l in
res t
g
s
he p
by t
e ld
it y h
Ac tu
ar i
p e n al g ain
si o n
s/lo
ss e
pr o
s on
v isi
o ns
D er
i v at
(cas ive fina
h flo
n c ia
wh
e d g l ins t r u
men
ing )
ts
v al
o f s ue mea
e cu
r i t ie sur e m
ent
s
sl a t
C um
ul a t
i ve
t r an
ing s
e ar n
ine d
– 65
37
0
14
2,519
16
2,535
465
–
–
–
–
465
2
467
Net income recognized
directly in equity
N on
2,408
–
Balance at 01.01.2010
E qu
125
Profit after taxes
in EUR million
Fair
Re t a
Total
shareholders’
equity
Sub
s cr i
bed
c ap
i t al
ion
dif f
er en
ny
ce s
Note 27
–
–
85
6
1
– 38
54
0
54
Total comprehensive income
–
465
85
6
1
– 38
519
2
521
Dividend payments
–
– 650
–
–
–
–
– 650
– 3
– 653
Other changes
–
–
–
–
–
–
–
5
5
125
2,223
20
43
1
– 24
2,388
20
2,408
Profit after taxes
–
373
–
–
–
–
373
1
374
Net income recognized
directly in equity
–
–
– 77
– 23
– 3
– 22
–125
0
– 125
Total comprehensive income
–
373
–77
–23
– 3
– 22
248
1
249
Dividend payments
–
– 233
–
–
–
–
–233
– 1
–234
Balance at 31.12.2010
Other changes
Balance at 31.12.2011
–
– 2
–
–
–
–
– 2
– 12
– 14
125
2,361
– 57
20
– 2
– 46
2,401
8
2,409
71
72
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1General
BSH Bosch und Siemens Hausgeräte GmbH (BSH-D) was formed in 1967 as a joint venture of
Robert Bosch GmbH, Stuttgart, and Siemens AG, Berlin and Munich. The activities of the BSH
Group (hereafter referred to as “Group” or “BSH”) comprise: the manufacture or procurement
and marketing, as well as research and development, of industrial products in the area of
electrical engineering, precision mechanics, and related technology, especially in the area
of home appliances, the manufacture or procurement and marketing of goods for use as
accessories, auxiliary materials, or tools with the manufactured or marketed products.
The registered office of the parent company (BSH-D) is situated at Carl-Wery-Strasse 34,
81739 Munich, Germany. The Board of Management prepared and approved the consolidated financial statements for publication on March 28, 2012.
2
Presentation of accounting policies
The following significant accounting policies were used in the preparation of the consolidated
financial statements of BSH:
2.1 Statement of compliance
The consolidated financial statements of BSH for the year ended December 31, 2011, have
been prepared in accordance with the mandatory International Financial Reporting Standards
(IFRSs) issued by the International Accounting Standards Board (IASB), London, as adopted
by the European Union (EU) and in force on the balance sheet date, and the additional
requirements under commercial law pursuant to Section 315a (1) of the German Commercial
Code (HGB).
2.2 Basis of presentation
The Group currency of BSH is the euro; unless stated otherwise, all amounts are reported in
millions of euros (EUR million).
The income statement is presented using the function-of-expense format. For the purposes of
clarity in the presentation, various captions in the balance sheet and income statement have
been aggregated. Please refer to the notes for separate disclosure and explanations.
The consolidated financial statements have been prepared on the basis of historical cost, with
the following exception:
financial assets held for trading and available-for-sale financial assets are recognized at fair
value.
The accounting policies described below have been consistently applied over the reporting
periods covered by these consolidated financial statements. An exception to this is the change
in the reporting of interest expense and income from plan assets from pension, semi-retirement and long service bonus obligations, which are disclosed within net finance income/cost
from 2011 onwards for greater transparency. These amounts were allocated to the individual
functional areas in prior years. The effect on the prior year figures in the consolidated statement of income is shown in Note 9 (“Finance income and finance expense”).
These accounting policies have also been uniformly applied by the companies in the Group.
ACCO U N T I N G P O L I C I E S | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
2.3 Amendments to accounting standards
2.3.1 Standards and interpretations with mandatory application requirement from January 1, 2011 onwards
The Group implemented all accounting standards with mandatory application requirement
from the 2011 financial year onwards.
The following standards and interpretations were applied for the first time in the reporting
period and have affected the consolidated financial statements:
Annual Innovations (AIP 2010).
Changes to IFRS 1, IFRS 3, IFRS 7, IAS 1, IAS 27, IAS 34, IFRIC 13
Various changes or corrections to existing IFRSs or follow-up amendments through previous
modifications to other IFRSs. The amendments have no material impact on the consolidated
financial statements of BSH.
The following standards and interpretations have no impact on the consolidated financial
statements:
Change to IAS 24 “Related Party Disclosures”
The definition of related parties has been fundamentally revised by the changes. Also,
exemptions from mandatory disclosure were granted to state-controlled entities. The
amendments have no material impact on the consolidated financial statements of BSH.
Change to IAS 32 “Classification of Rights Issues”
Concerns the requirements for the accounting treatment of foreign currency-denominated rights
issues for companies listed on different international stock exchanges. Rights and options to
purchase equity instruments are accordingly treated as equity instruments irrespective of their
currency.
Change to IFRS 1 “Limited Exemption from IFRS 7 Comparative Disclosures
for First-time Adopters”
This amendment to IFRS 1 provides first-time adopters with the same relief from providing the
comparative figures in connection with improved disclosures on financial instruments pursuant
to IFRS 7.
Changes to IFRIC 14 “IAS 19 – The Limit on a Defined Benefit Asset,
Minimum Funding Requirements, and their Interaction”
The interpretation concerns pension plans, for which minimum financing requirements exist.
If the company makes advance contributions, then it may recognize these as an asset. The
amendments have no material impact on the consolidated financial statements of BSH.
Adoption of IFRIC 19 “Extinguishing Financial Liabilities with Equity Instruments”
The interpretation applies when debt capital is exchanged for an issuer’s equity instruments
(debt-equity swap). IFRIC 19 clarifies that equity instruments issued as part of a conversion
should be regarded as a component of the remuneration paid to extinguish the financial
liability.
73
74
2.3.2 Standards and interpretations that have been approved but not yet applied
The consolidated financial statements for financial year 2011 do not take account of the
following new or revised accounting standards that have already been approved by the IASB
as there was no obligation to implement these standards.
Standard/
Interpretation
Mandatory for
financial years
beginning on
or after
Adoption
by the EU by
31.12.2011
Anticipated
effects
IFRS 1
Amendment in relation to severe
hyperinflation
01.07.2011
No
None
IFRS 7
Financial Instruments: Amendment on
enhancing disclosures about transfers of
financial assets
01.07.2011
Yes
Nothing
material
IFRS 9
Financial instruments
01.01.2015
No
Classification
and measurement
of financial
assets
IFRS 10
Consolidated financial statements
01.01.2013
No
Nothing
material
IFRS 11
Joint arrangements
01.01.2013
No
Nothing
material
IFRS 12
Disclosure of interests in other entities
01.01.2013
No
Nothing
material
IFRS 13
Fair value measurement
01.01.2013
No
Uniformity and
comparability of
the associated
“fair value hier­
archy”
IAS 1
Presentation of Financial Statements
01.07.2012
No
Presentation of
other compre­
hensive income
IAS 12
Income taxes: limited amendment in
relation to the recovery of the underlying
assets
01.01.2012
No
Nothing
material
IAS 19 (2011)
Employee Benefits
01.01.2013
No
Effects on the
expected
return on plan
assets
IAS 27 (2011)
Separate financial statements
01.01.2013
No
Nothing
material
IAS 28 (2011)
Investments in associated companies and
joint ventures
01.01.2013
No
Nothing
material
IAS 32
Financial instruments: Presentation –
offsetting financial assets and financial
liabilities
01.01.2014
No
Nothing
material
IFRIC 20
Stripping costs in the production phase of
a surface mine
01.01.2013
No
None
2.4 Foreign currency translation
Foreign currency transactions included in the annual financial statements of BSH-D and the
subsidiaries are translated at the exchange rate prevailing at the transaction date. At the
balance sheet date, monetary items denominated in foreign currency are recognized using the
closing rate. Any translation differences are recognized in the income statement.
The financial statements of consolidated subsidiaries prepared in foreign currency are translated on the basis of the functional currency concept (IAS 21 “The Effects of Changes in Foreign
Exchange Rates”) using the modified closing rate method. The foreign subsidiaries that are
part of the BSH Group carry out their activities independently from a financial, economic, and
organizational point of view, and for this reason, the functional currency is always the same as
ACCO U N T I N G P O L I C I E S | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
the company’s local currency. All assets and liabilities (but not equity) are translated at the
closing rate. The line items included in the income statement are translated at the annual
average rate. All resulting exchange rate differences are taken directly to a currency translation
reserve in other comprehensive income (OCI).
In the separate financial statements of BSH-D and the subsidiaries, foreign currency receivables
and payables are measured on initial recognition at the exchange rate on the date of the
transaction. Any exchange rate gains and losses at the balance sheet date are recognized in
the income statement.
The exchange rates of one euro for the most important currencies used for currency translation
have changed as follows:
Closing rate
31.12.2011
Average rate
31.12.2010
2011
2010
US dollar (USD)
1.2939
1.3362
1.3920
1.3257
Pound sterling (GBP)
0.8353
0.8608
0.8679
0.8579
Russian ruble (RUB)
41.7650
40.8200
40.8846
40.2629
Turkish lira (TRY)
2.4497
2.0601
2.3273
1.9944
Chinese renminbi (CNY)
8.1625
8.8065
9.0014
8.9740
2.5 Basis of consolidation and consolidation principles
The consolidated financial statements include BSH-D and all companies under its control.
This control usually exists if BSH-D, directly or indirectly, holds over 50% of the voting rights
of the subscribed capital of an entity or has the power to govern the financial and operating
policies of the entity. The interests of minority shareholders in the Group’s equity and profits
are reported separately on the face of the balance sheet and income statement.
Consolidation starts from the date on which the BSH Group acquires the option of control. It
ends when this option is no longer available.
The financial statements of BSH-D and its consolidated subsidiaries have been prepared,
audited and included in the consolidated financial statements in accordance with IAS 27 with
the application of accounting policies that are uniform throughout the BSH Group.
Consolidated as of 31.12.2010
Germany
Other
countries
Total
66
11
55
Consolidated for the first time in 2011
0
2
2
De-consolidated in 2011 (including mergers)
0
0
0
11
57
68
Consolidated as of 31.12.2011
See note 3 for more information on changes to the basis of consolidation.
The consolidated entities also include a fund. As of December 31, 2011, seven (2010: four) companies were not consolidated because they have no or only insignificant operating activities.
This does not have any material impact on the Group’s financial position or financial performance. In addition, BSH Bosch und Siemens Hausgeräte Altersfürsorge GmbH, Munich, is not
consolidated because its assets are defined as plan assets and these are deducted from
pension provisions in accordance with IAS 19. The consolidated financial statements and group
management report of BSH are published in the electronic German Federal Gazette. See Annex
II of the notes to the consolidated financial statements for more information on shareholdings.
75
76
Acquisitions are accounted for on the basis of the fair values applicable at the date of acquisition
or first-time consolidation. Any debit difference between purchase price and fair values is
recognized as goodwill.
Intra-group balances and intra-group transactions as well as resulting intragroup profits and
losses are eliminated in full. Deferred tax is recognized for consolidation transactions recognized in the income statement.
2.6Revenue
Revenue from the sale of products is recognized when ownership or risk and reward are
transferred to the customer, a price has been agreed or can be determined, and its payment
can be expected. Revenue is reported net of discounts, price reductions, customer bonuses,
and rebates.
Royalties are recognized on an accrual basis in accordance with the substance of the relevant
agreement.
2.7 Research and development costs
Research expenditure is recognized as an expense when incurred. Likewise, development
expenditure is recognized as an expense when incurred. This does not apply to project
development costs that fully meet the following criteria:
– The product or system is clearly defined and the relevant expenditure can be clearly
assigned and reliably measured;
– The technical feasibility of the product can be demonstrated;
– The product or system will be either marketed or used internally;
– The assets will generate future economic benefits (e.g., the entity can demonstrate the
existence of a market for the product or, if it is to be used internally, its usefulness);
– There are adequate technical, financial, and other resources to complete the project.
Costs are capitalized from the time the above criteria are met. Costs recognized as expenses in
previous accounting periods are not capitalized retrospectively.
2.8 Trade accounts receivable
Trade accounts receivable are reported at amortized cost. Any necessary valuation allowances,
which are based on the probable risk of default, are taken into account. Write-downs on trade
accounts receivable are recognized using valuation allowance accounts. Non-interest-bearing
or low-interest bearing receivables with maturities of more than one year are discounted. If the
requirements of IAS 32.42 are met, receivables and payables are netted.
2.9Inventories
Inventories are recognized at the lower of cost or net realizable value. Net realizable value is
the estimated selling price in the ordinary course of business less the estimated costs of
completion and the estimated costs necessary to make the sale. Work in process and finished
goods are recognized at the cost of conversion. This includes all costs directly assignable to
the production process and an appropriate portion of production overheads. In turn, this
includes production-related depreciation, a proportion of administrative costs and pro rata
employee benefit costs. Borrowing costs are not capitalized. Inventory risks that result from
the duration of storage or reduced usefulness or marketability are taken into account by
recognizing write-downs. The net realizable value is recognized at the balance sheet date if
this value is lower than the cost. When the circumstances that previously caused inventories
to be written down below cost no longer exist or when there is clear evidence of an increase in
net realizable value because of changed economic circumstances, the amount of the writedown is reversed (i.e. the reversal is limited to the amount of the original write-down) so that
the new carrying amount is the lower of the cost and the revised net realizable value.
ACCO U N T I N G P O L I C I E S | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
2.10 Financial instruments
A financial instrument is a contract that simultaneously leads to a financial asset in one entity
and a financial liability or equity instrument in another. Financial instruments involve nonderivative as well as derivative assets or liabilities.
The shares in non-consolidated affiliated companies and associates reported under financial
assets are recognized at cost, unless a different market value is available.
As specified by IAS 39, financial investments are broken down into the following categories:
(a) held-to-maturity investments,
(b)financial assets at fair value through profit or loss,
(c) available-for-sale financial assets, and
(d) loans and receivables.
Financial assets with fixed or determinable payments and fixed maturity that the Company
has the positive intent and ability to hold to maturity, other than loans and receivables, are
classified as held-to-maturity investments. Financial assets obtained principally to generate
a profit from short-term fluctuations in price or exchange rates are measured and classified at
fair value through profit or loss.
Securities held as financial assets at fair value through profit or loss and securities held for
trading are recognized at market value, if available. If no market value is available, they are
carried at cost.
Changes in the fair value of financial assets at fair value through profit or loss are recognized
through the income statement.
All other financial assets, other than loans and receivables originated by the Company, are
classified as available-for-sale financial assets. Until realized, gains and losses on the fairvalue measurement of an available-for-sale financial asset are recognized in equity, taking
deferred tax into account.
Available-for-sale financial assets are measured in accordance with IAS 39.61.
2.11 Property, plant and equipment
Property, plant, and equipment is measured at cost, less straight-line depreciation and, in
some cases, impairment losses. Low-value assets are written off in the year of acquisition.
The cost of internally generated property, plant, and equipment comprises all direct costs
and a reasonable portion of the necessary material and production overheads. This includes
production-related depreciation, as well as a proportion of the costs for the Company’s
pension plan and voluntary employee benefits. Borrowing costs for qualifying assets are
capitalized in accordance with IAS 23.
Depreciation is based on the following useful lives:
Buildings
12.0– 33.3 years
Machinery and equipment
6.0–13.0 years
Office equipment and vehicles 3.0 – 8.0 years
Land is not depreciated. Excepted from this are leaseholds and other interests in land, which
are depreciated over the duration of the contract.
77
78
In accordance with IAS 36 “Impairment of Assets”, impairment losses are recognized on
property, plant, and equipment if both the realizable value and the value in use of the asset
concerned fall below its carrying amount. An impairment loss is then recognized to reduce the
carrying amount of the asset to the lower of realizable value and value in use. If the reasons
for an impairment loss no longer apply, the impairment loss is reversed, but the increased
carrying amount must not exceed the carrying amount that would have been determined (net
of amortization) if no impairment loss had been recognized.
Amortization and impairment losses charged during the year under review are reported under
functional costs or other operating expenses. Reversals of impairment losses are reported
under functional costs or other operating income.
2.12 Intangible assets (excluding goodwill)
Purchased and internally generated intangible assets are carried at cost. Assets with finite
useful lives are amortized over their useful lives. Borrowing costs are capitalized for qualifying
assets.
Amortization is based on the following useful lives:
Patents, licenses and customer basesin accordance with normal operating life
(contract, license period, etc.)
Purchased software 4 years
Internally generated intangible assets
4 – 6 years
Amortization is applied using the straight-line method. An impairment loss is recognized if
an asset is found to be impaired. If the reasons for an impairment loss no longer apply, the
impairment loss is reversed, but the increased carrying amount must not exceed the carrying
amount that would have been determined (net of depreciation) if no impairment loss had been
recognized. Assets with infinite useful lives are not amortized.
Depreciation and impairment losses charged during the year under review are reported under
functional costs or other operating expenses. Reversals of impairment losses are reported
under functional costs or other operating income.
2.13 Impairment losses on property, plant and equipment, and intangible assets
To meet the requirements of IFRS 3, in combination with IAS 36, and to test for goodwill
impairment, the Group has defined cash-generating units that match the legal entities or
countries. These cash-generating units were subjected to an impairment test.
For the purposes of an impairment test, the carrying amount of each cash-generating unit is
determined by allocating assets and liabilities, including attributable goodwill and intangible
assets. An impairment loss is recognized if the recoverable amount of a cash-generating unit is
lower than its carrying amount. The recoverable amount is fair value less costs to sell or value
in use (value of expected future cash inflows from the asset), whichever is the higher.
ACCO U N T I N G P O L I C I E S | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
For its impairment tests, BSH used a discounted cash flow (DCF) method to determine the
expected future cash inflows from a cash-generating unit. The calculation of the cash flows of
each cash generating unit is based on business plans with a planning horizon of three years.
Inflation-related growth rates specific to each country were assumed after the end of the
three-year planning period. The discount rate for each country (including an additional risk
factor) amounted to between 5.9% p.a. and 17.5% p.a. (2010: between 8.2% p.a. and 16.9%
p.a.). An interest rate of 17.5% p.a. was used for the Group’s Greek subsidiary (see also Note 20).
2.14Goodwill
Goodwill is recognized in accordance with IFRS 3. Goodwill is tested for impairment regularly
at least once a year; if required, an appropriate impairment loss is recognized. Under IAS 36
“Impairment of Assets”, any requirement for an impairment loss is determined by comparing
the expected future discounted cash flows of the cash-generating unit in question with the
relevant goodwill amount attributable to the unit.
2.15 Pension provisions
Provisions for pensions and other post-retirement benefits are recognized using the projected
unit credit method as specified in IAS 19 “Employee Benefits”. In addition to the pensions and
vested benefits known as of the balance sheet date, this method takes into account expected
future increases in salaries and pensions. If pension obligations are covered by plan assets,
only the net amount is reported. The calculation is based on actuarial reports taking into
account biometric calculation methods.
The actuarial gains and losses that arose in the year under review are recognized in other
comprehensive income in accordance with IAS 19.93A et seq.
2.16Provisions
A provision is recognized if a present (legal or constructive) obligation exists as a result of a
past event, it is probable that an outflow of resources embodying economic benefits will be
required to settle the obligation, and a reliable estimate can be made of the amount of the
obligation. Provisions are tested at each balance sheet date and adjusted to the current best
estimate. Where a provision is assessed using the estimated cash flows for settling the
obligation, the carrying amount of the provision is the present value of these cash flows.
Where discounting is used, the carrying amount of a provision increases in each period to
reflect the passage of time. This increase is recognized under other net finance income/cost.
2.17 Derivative financial instruments
Derivative financial instruments are employed solely for hedging purposes in order to reduce
exchange rate, interest rate and fair value risks from operating business and any resultant
finance requirements. According to IAS 39, all derivative financial instruments such as
commodity, interest rate and currency derivatives and combinations thereof, are recognized
at fair value, regardless of the purpose or intention behind them. The fair value of derivative
financial instruments is determined on the basis of market data and recognized valuation
techniques. With support from IT systems, derivative financial instruments are marked to
market by discounting cash flows or by using option price models with parameters in line with
market conditions. The effective portion of the change in fair value of derivative financial
instruments, for which cash flow hedge accounting is applied, is recognized in equity as part
of accumulated other shareholders’ equity. It is reclassified to the income statement at the
79
80
same time as the hedged item is realized. That part of the change in fair value not covered by
the underlying transaction is immediately recognized in the income statement. If hedge
accounting cannot be applied, the change in fair value of derivative financial instruments is
recognized in the income statement.
The change in fair value and the realization of derivative financial instruments not qualifying
for hedge accounting, which hedge the operative hedged items, is shown under other operating
expenses or income. The change in fair value and the realization of derivatives for hedging
financial hedged items is recognized in other net finance income/cost.
If this involves “combined instruments”, for which separate measurement of the embedded
derivative instruments is not possible, the entire “combined instrument” is recognized at fair
value through profit or loss.
2.18Leases
A lease is classified as an operating lease if the lessor retains substantially all the risks and
rewards incident to ownership. Lease payments under an operating lease are recognized as an
expense and allocated equally to each period of the lease term.
2.19 Government grants
A government grant is not recognized until there is reasonable assurance that the Company
will comply with the conditions attaching to it, and that BSH will receive the grant. Government
grants are recognized as income on a systematic and rational basis over the periods necessary
to match them with the related costs that they are intended to compensate. Grants received
for the acquisition of property, plant, and equipment are treated as a reduction in the cost of
such assets. Other grants received are initially recognized as a liability on the balance sheet
(miscellaneous other liabilities), which is then used to offset the corresponding depreciation
charges over the useful life of the asset concerned.
2.20 Management judgment
The preparation of the consolidated financial statements in accordance with IFRSs requires
that assumptions and estimates be made that may impact on the amount recognized for the
assets and liabilities on the balance sheet, income and expenses, as well as contingent
liabilities. Estimates and assumptions may change over time and have a significant impact
on the Group’s financial position and performance. The assumptions and estimates relate
primarily to the measurement of property, plant, and equipment, intangible assets, impairment of assets, the recognition and measurement of provisions, and the extent to which
future tax benefits can be realized. The estimates and assumptions are regularly assessed
and adjusted if necessary. At the time of preparation of the consolidated financial statements,
no material changes to the underlying assumptions and estimates were anticipated.
Allowances on doubtful receivables reflect to a significant extent current assumptions and
estimates for specific receivables that are based on the current credit rating of the customer in
question and the economic environment in the country concerned.
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Goodwill, property, plant and equipment, and intangible assets are tested for impairment at
least once a year. The measurement methods used are based on discounted cash flows and
use weighted average costs of capital, estimated growth rates and tax rates. The planning
horizon is a three-year plan approved by management.
Deferred tax assets are recognized to the extent that they are likely to be realized in future. The
assessment of this is determined by the extent to which taxable profits will be generated in
future, against which previously unused tax loss carryforwards and tax credits can be utilized
and temporary valuation differences are reversed.
Provisions for pensions and similar obligations and the corresponding expenses and income
are recognized on the basis of actuarial methods. The main estimated variables are discount
factors, the expected return on plan assets, salary and pension trends, and life expectancies.
The parameters are defined according to circumstances as of the balance sheet date. Due to
fluctuating market and economic conditions, these actuarial assumptions may differ considerably
from future developments and may therefore lead to a material change in the obligations for
pensions and other post retirement benefits.
The measurement of provisions for warranties, onerous contracts and litigation involves
significant future estimates, some of which are determined on the basis of past experience
and adjusted in line with the latest assessment.
3
Change to the basis of consolidation
The subsidiaries BSH Household Appliances Manufacturing Private Limited (Mumbai), India,
and BSH Home Appliances Limited (Yongin-City), South Korea, which were newly established
in the year under review, were included in the consolidated financial statements for the first
time.
81
82
4Revenue
Revenue was primarily generated from electrical and gas appliances, as well as from related
customer services; it breaks down as follows:
in EUR million
2011
%
2010
%
2,062
21.4
1,906
21.0
Western Europe (excluding Germany)
3,514
36.4
3,540
39.0
Eastern Europe (including Turkey)
1,846
19.1
1,598
17.6
479
5.0
534
5.9
Germany
North America
Latin America
Asia
Rest of world
Total
51
0.5
45
0.5
1,506
15.6
1,281
14.1
196
2.0
169
1.9
9,654
100.0
9,073
100.0
5
Cost of sales
The cost of sales figure of EUR 6,077 million (2010: EUR 5,609 million 1)) comprises the full
production-related costs incurred in the manufacture of the products sold.
6
Selling and administrative expenses
Selling and administrative expenses amounted to EUR 2,582 million (2010: EUR 2,357 million 1))
and comprised solely costs, income and expenses allocated to these categories. General and
administrative expenses include personnel costs, other administrative expenses and depreciation/amortization in corporate departments that cannot be assigned to production, sales and
marketing, or research and development.
7
Research and development costs
Research and development costs amounting to EUR 298 million (2010: EUR 277 million 1))
include research costs and development costs not recognized in the balance sheet. No
development costs were capitalized during 2011, as in the previous year.
1
) Values after adjusting the reporting of interest expense and income from plan assets from pension, semi-retirement and long service bonus obligations. For further information see Notes 2.2 and 9.
8
Other operating income and expenses
in EUR million
Income from the reversal of provisions (not function-related)
Foreign currency gains on trade accounts receivable and payable
Income from the reversal of allowances on and remeasurement of receivables
2011
2010
25
37
109
94
27
19
Rental and leasing income
1
4
Gains on the disposal of assets
7
4
44
63
Gains on foreign exchange derivatives
Income from costs transferred to third parties
42
35
Other operating income 2)
98
47
353
303
Expenses to set up provisions (not function-related)
93
114
Foreign currency losses on trade accounts receivable and payable
98
80
Expenses from allowances on receivables
39
35
Total other operating income
Losses on the disposal of assets
Impairment losses
Other taxes
5
7
11
14
7
1
Losses on foreign exchange derivatives
37
78
Other operating expenses 2)
67
34
357
363
Total other operating expenses
2
) O ther operating income contains insurance settlements amounting to EUR 46 million (2010: EUR 0 million). Against these are expenses from
underlying insured events, of which EUR 44 million (2010: EUR 0 million) are contained within other operating expenses.
N OT E S T O T H E CO NS O L I DAT E D S TAT E M E N T O F I N CO M E | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
9
Finance income and finance cost
in EUR million
2011
Finance income
Finance cost
2010
60
53
169
116
– 109
– 63
35
29
– of which to non-consolidated affiliated companies EUR 0.2 million (2010: EUR 0.1 million)
Net finance income/cost
Allocation as specified by IFRS 7.20 (b) using IAS 39 measurement categories:
– Loans and receivables
– Financial assets, available-for-sale
– Financial liabilities carried at amortized cost
15
14
– 112
– 55
– 47
– 51
No allocation as specified by IFRS 7.20 (b):
Interest expense and income from plan assets from pension,
semi-retirement and long service bonus obligations
In 2011, BSH decided to change its reporting of interest expense and income from plan assets
from pension, semi-retirement and long service bonus obligations and has allocated these to
finance cost and finance income within net finance income/cost. These amounts were allocated to the individual functional areas in prior years (see also Note 2.2). The adjustment to
the prior year figures in the consolidated statement of income can be seen in the table below:
in EUR million
2011
2011
incl. interest
as specified
by IAS 19 1)
Cost of sales
6,077
0
5,609
16
5,625
Selling and administrative expenses
2,582
0
2,357
29
2,386
298
0
277
6
283
60
8
53
7
46
169
55
116
58
58
Research and development expenses
Finance income
Finance cost
Interest as specified by IAS 19 1)
1
2010
after
adjustment
Adjustment
of interest as
specified by
IAS 19 1)
2010
before
adjustment
47
51
) Interest expense and income from plan assets from pension, semi-retirement and long service bonus obligations
Interest income and expense calculated under the effective interest rate method was recognized in the income statement for financial assets and financial liabilities not measured at fair
value.
Interest expenses were reduced for the first time in 2011 by capitalized borrowing costs for
qualifying assets amounting to EUR 0.4 million. The borrowing rate used for this purpose was
3.0%.
10 Other net finance income/cost
Other net finance income/cost relates to the fair-value measurement as well as the realization
of derivatives for hedging financial items, the disposal of securities, the measurement of
receivables and liabilities denominated in foreign currency, interest cost arising from the
unwinding of the discount on provisions, and miscellaneous other finance income and expense. In 2011, available-for-sale financial assets were sold. This resulted in an increase in
equity of EUR 5 million (2010: decrease in equity of EUR 15 million) and the recognition of an
equivalent figure as an expense (2010: income) under net finance income/cost. Expenses
according to IAS 39.67 amounted to EUR 11 million (2010: EUR 3 million). As in 2010, income
generated from reversals of impairments of debt instruments was immaterial.
83
84
11 Income tax
The breakdown of the BSH Group’s tax on income by source is as follows:
in EUR million
Current tax
Deferred tax
Total income tax
2011
2010
164
232
0
– 8
164
224
Income tax paid or payable in the various countries as well as deferred tax is reported under
income tax. Deferred tax is calculated on the basis of temporary differences between the
carrying amounts of assets and liabilities in the IFRS financial statements and those in the tax
base, and on the basis of consolidation transactions, recoverable loss carryforwards and tax
credits. The calculation is based on the tax rates expected to be in force in the various
countries at the time the asset is realized or the liability is settled. In all cases, the rates are
derived from the laws and provisions in force or enacted at the balance sheet date.
Germany’s corporate income tax rate in 2011 was 15% plus a solidarity surcharge of 5.5% of the
corporate income tax charge. Taking into account trade tax at 13.66%, the overall tax rate for
the companies in the German tax group was 29.49% (2010: 29.35%).
The reported income tax expense in the year under review of EUR 164 million is EUR 5 million
higher than the expected income tax expense of EUR 159 million, which would in theory arise
if the German tax rate were to be applied to the consolidated profit before tax.
The reconciliation between the expected tax expense and the reported tax expense is as
follows:
in EUR million
2011
2010
Profit before tax
538
691
Expected tax charge when using the tax rate applicable to the parent
company of 29.49% (2010: 29.35%)
159
203
Effects of differences in foreign tax rates
–28
– 40
2
– 3
Effects of permanent differences
Effects of changes in tax rates
18
72
Tax expenses relating to other periods
19
3
Change in the recoverability of deferred tax assets
– 8
– 12
Other changes
2
1
164
224
30.5
32.5
in EUR million
2011
2010
Deferred tax assets
204
194
Reported income tax expense
Group tax rate (in %)
Deferred tax in the consolidated balance sheet:
Deferred tax liabilities
Total deferred tax
22
22
182
172
Of the deferred tax assets and liabilities, the following items were recognized in equity:
Deferred tax assets (+) and liabilities (–) recognized directly in OCI (in EUR million)
Available-for-sale financial assets
Cash flow hedging instruments
2011
2010
– 6
– 7
1
– 1
Actuarial gains/losses on defined benefit pension plans and similar obligations
17
9
Total
12
1
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Deferred tax assets and liabilities are derived from the following individual balance sheet
items:
Deferred tax assets
in EUR million
Deferred tax liabilities
2011
2010
2011
2010
Intangible assets and property, plant and equipment
34
25
63
58
Receivables and other assets
28
26
28
26
Inventories
66
56
4
4
Liabilities
51
51
26
2
Other provisions
82
106
2
2
Pension provisions
67
49
1
0
3
0
5
8
113
88
0
0
0
0
0
11
444
401
129
111
Impairment losses
–133
– 118
0
0
Netting
– 107
– 89
– 107
– 89
204
194
22
22
Available-for-sale securities
Tax loss carryforwards and tax credits
Other
Gross total
Deferred tax after netting
Deferred tax assets are recognized to the extent it is probable that future taxable profit will be
available against which losses can be utilized. At each balance sheet date, a new assessment
is made of unrecognized deferred tax assets and of the carrying amount of deferred tax assets.
A write-down of deferred tax assets was performed on tax loss carryforwards and tax credits
amounting to EUR 105 million (2010: EUR 82 million) and on deductible temporary differences
totaling EUR 28 million (2010: EUR 36 million), as direct use in the foreseeable future seems
improbable. The change in the write-downs was recognized in the income statement. Out of
the total amount of the write-downs amounting to EUR 133 million (2010: EUR 118 million),
EUR 28 million (2010: EUR 36 million) can be carried forward without limitation and EUR 102
million (2010: EUR 82 million) can be carried forward for more than three years. EUR 3 million
(2010: EUR 0 million) will lapse within the next three years.
As of December 31, 2011, the BSH Group had unutilized tax loss carryforwards of EUR 171
million (2010: EUR 143 million) and tax credits of EUR 55 million (2010: EUR 55 million). The
following table shows the utilization periods for the loss carryforwards:
Utilization period of tax loss carryforwards (in EUR million)
2011
2010
Limited carryforward period, less than 3 years
10
2
Limited carryforward period, more than 3 years
159
137
Unlimited carryforward period
Total
2
4
171
143
Loss carryforwards for which no deferred tax assets have been recognized amounted to
EUR 147 million (2010: EUR 134 million).
Utilization periods for tax credits (in EUR million)
2011
2010
Limited carryforward period, less than 3 years
3
22
Limited carryforward period, more than 3 years
52
33
Unlimited carryforward period
Total
0
0
55
55
Tax credits for which no deferred tax assets have been recognized amounted to EUR 52 million
(2010: EUR 51 million).
85
86
Net deferred tax liabilities of EUR 11 million (2010: EUR 11 million) were recognized for temporary
differences in connection with investments in subsidiaries. These “outside basis differences”
include for the most part the tax on possible dividend payments. Furthermore, in accordance
with IAS 12.39, no deferred tax liabilities were recognized for temporary differences amounting
to EUR 147 million in connection with investments in subsidiaries because the Group is able to
control the timing of the reversal of the temporary differences and it is unlikely that these
temporary differences will be reversed in the foreseeable future.
12 Non-controlling interests
The profit attributable to the non-controlling interests amounting to EUR 1 million (2010:
EUR 2 million) was generated by BSH Ev Aletleri Sanayi ve Ticaret A. Ş., Istanbul, BSH Home
Appliances Services Ltd., Jeddah, and Constructa-Neff Vertriebs-GmbH, Munich. BSW
Household Appliances Co., Ltd., Wuxi also contributed to the net profit attributable to the
non-controlling interests in 2010.
13 Other income statement disclosures
The functional costs include the following personnel expenses:
in EUR million
Wages and salaries
Social security contributions
Expenses for pension plans and benefits
Personnel expenses
2011
2010 1)
1,541
1,480
281
259
71
68
1,893
1,807
1) After adjusting the reporting of interest expense and income from pension, semi-retirement and long service bonus obligations,
which were previously fully contained within personnel expenses. For further information see Notes 2.2 and 9.
The cost of materials totaled EUR 4,835 million (2010: EUR 4,345 million).
The Group received government grants for research and development amounting to EUR 6
million (2010: EUR 3 million) and other grants amounting to EUR 2 million (2010: EUR 4 million),
which were recognized directly in the income statement.
The average number of employees in the year under review was as follows:
2011
2010
BSH GmbH
– Direct employees
6,450
6,368
– Indirect employees
6,306
5,909
of which apprentices
329
331
1,806
1,699
Companies outside Germany
30,252
26,960
Total
44,814
40,936
2011
2010
Other companies in Germany
14 Cash and cash equivalents
The breakdown of cash and cash equivalents is as follows:
in EUR million
Checks
15
6
7
8
Bank balances
489
561
Cash and cash equivalents
511
575
Cash in hand
All items under cash and cash equivalents are due within three months calculated from the
date of acquisition – as in 2010.
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15Securities
In accordance with IAS 39, securities are classified as available for sale and recognized at
fair value.
16
Trade accounts receivable
in EUR million
Trade accounts receivable (third parties)
2011
2010
2,362
1,851
Allowances on receivables
– 103
– 116
Trade accounts receivable, net
2,259
1,735
Trade accounts receivable
2,362
1,851
– of which, as of the balance sheet date, neither written down nor overdue
2,028
1,468
of which, as of the balance sheet date, not written down but overdue as follows:
84
82
less than 1 month
60
42
between 1 month and 3 months
17
20
7
20
more than 3 months
The changes in allowances on trade accounts receivable (loans and receivables category) were
as follows:
in EUR million
Balance at 01.01.
2011
2010
116
117
– 2
4
–
–
Additions
33
24
Utilization
20
17
Reversals
24
12
103
116
Exchange rate differences
Change in basis of consolidation
Balance at 31.12.
As regards trade accounts receivable that were neither written down nor in default, there were
no indications as of the balance sheet date that the debtors were unable to meet their payment
obligations. Additionally, a Group average of one third of trade accounts receivable are insured
by the companies concerned. Furthermore, securities are available for some trade accounts
receivable in the form of guarantees, land charges, mortgages and collateral securities.
As of December 31, 2011, the carrying amount of trade accounts receivable for which contractual
conditions were being renegotiated stood at EUR 1 million (2010: EUR 1 million).
Trade accounts receivable include an amount of EUR 0.1 million (2010: EUR 0.1 million) that is due
for payment in more than one year.
87
88
17
Other current assets
in EUR million
2011
2010
Other receivables (third parties)
206
262
Other receivables from non-consolidated affiliated companies
Prepaid expenses
Current derivative financial instruments (note 29)
Other tax receivables and receivables from employees
Allowances on other current assets
0
1
19
20
7
8
154
141
–7
– 5
379
427
in EUR million
2011
2010
Finished goods and merchandise
902
834
Total other current assets
18Inventories
Work in process
Raw materials, consumables and supplies
36
31
297
289
Spare parts
56
53
Advance payments
14
19
1,305
1,226
Total
The write-down recognized in the year under review was EUR 104 million (2010: EUR 93
million). The spare parts item comprises components held in warehouses to cover a 10-year
parts warranty on home appliances. As in 2010, no inventories were pledged as collateral.
19 Non-current financial assets
Non-current financial assets included the following:
in EUR million
Financial assets
Financial investments
Other non-current assets
Non-current financial assets
2011
2010
747
880
1
0
15
11
763
891
2011
2010
The following table shows the breakdown of other non-current assets:
in EUR million
Loans (third parties)
1
1
Non-current derivative financial instruments (note 29)
1
0
Miscellaneous non-current assets
13
10
Total other non-current assets
15
11
As in 2010, no impairment losses were recognized for loans and there were no overdue loans.
20 Property, plant and equipment
The consolidated statement of changes in fixed assets (see Annex I) shows a breakdown of the
property, plant, and equipment items aggregated on the face of the balance sheet, together
with the changes in these items in the year under review.
As a result of the economic situation, impairment losses amounting to EUR 11 million were
recognized in the year under review (2010: EUR 14 million). These impairment losses related
primarily to the subsidiaries in Greece and Peru (2010: only Peru).
N OT E S T O T H E B A L A N C E S H E E T | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
As of the balance sheet date, obligations incurred in connection with the acquisition of
property, plant, and equipment amounted to EUR 10 million (2010: EUR 2 million). As in 2010,
there were no restraints on the utilization of property, plant, and equipment in the year under
review. Government grants with a total value of EUR 2 million (2010: EUR 2 million) were
deducted from new additions in the year under review; they include incentives for structurally
weak regions in Germany.
Borrowing costs of EUR 0.4 million for qualifying assets were capitalized for the first time.
21 Intangible assets
Please refer to the statement of changes in fixed assets (Annex I) for information on changes in
intangible assets.
Additions under this item included the costs of purchased software, tool licenses, industrial
and similar rights, brand names, customer bases, and similar assets. A material item included
in intangible assets is goodwill of EUR 160 million (2010: EUR 185 million). EUR 134 million of
this (2010: EUR 160 million) relates to the Group’s Turkish subsidiary. As in 2010, there were no
additions to goodwill in the year under review.
All goodwill items recognized in the consolidated balance sheet and assigned to cashgenerating units were tested for impairment. As in 2010, no impairment was recognized.
As in 2010, there were no restraints on the utilization of intangible assets in the year under
review.
22 Current and non-current financial liabilities
Current and non-current financial liabilities comprise primarily of liabilities to banks and
a bond issued in the year under review.
The financial liabilities have the following remaining periods to repayment:
in EUR million
2011
2010
Up to 1 year
471
288
1 – 5 years
459
236
More than 5 years
121
9
1,051
533
Total
Financial liabilities due within one year are reported as current financial liabilities; financial
liabilities due after one year are classified as non-current financial liabilities.
89
90
The following table shows the contractually agreed (undiscounted) interest and redemption
payments for primary financial liabilities and the derivative financial instruments with negative
fair value:
in EUR million
Other current liabilities
Carrying
amount
31.12.2011
2012
2013
2014
2015
2016
> 2016
1,061
1,061
–
–
–
–
–
Bond
244
8
8
112
5
97
53
Liabilities to banks
807
482
66
94
92
35
74
Other financial liabilities
104
105
0
–
–
–
–
16
18
1
1
0
2
–
Carrying
amount
31.12.2010
2011
2012
2013
2014
2015
> 2015
1,029
1,029
–
–
–
–
–
Liabilities to banks
533
299
68
64
61
59
9
Other financial liabilities
176
176
0
0
–
–
–
7
6
1
–
–
–
–
Derivative financial instruments
in EUR million
Other current liabilities
Derivative financial instruments
In September 2011, BSH issued a bond with a total volume of CNY 2 billion on the offshore
renminbi market in Hong Kong. The bond was split into the following tranches:
Tranche
Nominal value
CNY million
Nominal value
EUR million 1)
Due date
for payments
1
850
97
29.09.2014
2
750
86
28.09.2016
400
46
28.09.2018
2,000
229
3
Total
1
) translated at the transaction rate
23 Trade accounts payable
Trade accounts payable are recognized at the higher of their nominal amount and settlement
amount; all trade accounts payable are due within one year, as in 2010.
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24 Other liabilities and provisions (current)
Current provisions and other current liabilities break down as follows:
in EUR million
2011
2010
Provisions for tax
22
83
Other provisions
443
406
Current provisions
465
489
Notes payable
91
175
Advance payments received
74
52
555
483
Accrued liabilities
Deferred income
Other tax liabilities
Current derivative financial instruments (note 29)
Miscellaneous other liabilities
Other current liabilities
3
2
83
67
15
6
240
244
1,061
1,029
The statement of changes in provisions (note 25) gives details of changes in current provisions.
25 Other liabilities and provisions (non-current)
The following table shows the breakdown of other non-current liabilities and non-current
provisions:
in EUR million
2011
Non-current derivative financial instruments (note 29)
2010
1
1
Miscellaneous other liabilities
19
19
Other non-current liabilities
20
20
100
Provisions for tax
100
Other provisions
309
425
Non-current provisions
409
525
The following table shows the breakdown of other provisions, both current and non-current:
in EUR million
Tax
provisions
Provisions
for personnel
and employee
benefit
obligations
Provisions
in relation to
sales
Other
provisions
Total
1,014
183
158
391
282
Foreign currency translation
–1
0
– 5
0
– 6
Utilization
39
42
181
82
344
Balance at 01.01.2011
Reversals
26
2
32
28
88
Additions
22
28
204
53
307
Interest cost (unwind of discount)
0
1
7
2
10
Reclassifications
– 17
0
1
– 3
– 19
Balance at 31.12.2011
122
143
385
224
874
22
56
246
141
465
100
87
139
83
409
Current portion of provisions
Non-current portion of provisions
The reclassifications are shown under accrued liabilities (note 24).
91
92
Non-current provisions predominantly cover a period of up to five years.
The provisions for personnel and employee benefit obligations include for the most part
obligations related to semi-retirement, employee long-service awards, the collective pay
agreement (ERA) adjustment fund, and performance-related arrangements. The sales-related
provisions primarily comprise provisions for general and extended warranty obligations.
Other provisions include provisions to cover obligations under guarantees, contractual
agreements in Germany and abroad, environmental protection, and other risks.
BSH has set up provisions for existing legal disputes on the scale deemed necessary at this
time to cover claims that may arise. Although the Group essentially considers the claims made
to be unjustified, liabilities over and above this also cannot be ruled out completely.
Provisions set up in 2010 for sales risks have been partially released as a result of updated
estimates.
The Group reached agreements with the tax authorities in respect of value-added tax for global
customer services and export transactions, as a result of which the provisions created to cover
these risks have been utilized. Tax risks based on customer refunds were provided against to a
significant extent in the year under review.
26
Provisions for pensions and other post-retirement benefits
26.1 Defined benefit plans
As of December 31, 2011, the consolidation for the first time included pension obligations in an
additional subsidiary in China.
BSH has obligations under a Company pension plan for employees in Germany. This plan largely
involves the payment of lump-sum/pension benefits and/or individual fixed amounts. For
employees in other countries (Belgium, Great Britain, Norway, Portugal, Sweden and Switzerland), the benefits mainly depend on the number of years of service and the salary received
immediately prior to retirement. The post-retirement benefits granted in the other countries are
lump-sum payments.
The post-retirement benefits in Germany are mainly financed by the recognition of pension
provisions; part of the obligation is funded through an employee trust. In other countries,
they are mainly funded through insurers and pension funds.
The commitment under defined benefit plans is measured annually using the projected unit
credit method or approximations.
In accordance with IAS 19.93A, the other comprehensive income rule is applied in determining
pension provisions and the pension expense. Actuarial gains and losses are reported in OCI
in the year in which they arise.
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The breakdown of pension obligation funding is as follows:
Germany
Other
countries
Germany
Other
countries
2011
2011
2010
2010
45
47
43
51
Present value of funded pension obligations
845
110
810
99
External plan assets
– 69
– 92
– 77
– 83
Funding balance
821
65
776
67
in EUR million
Present value of unfunded pension obligations
Unrecognized past service cost
–
0
–
0
Effect of asset limitation (IAS 19.58(b))
–
–
–
0
821
65
776
67
Germany
Other
countries
Germany
Other
countries
2011
2011
2010
2010
58
Pension provisions
The pension provisions changed as follows in the course of 2011:
in EUR million
Brought forward
776
67
716
Exchange rate differences
–
– 2
–
1
Transfer values
0
0
0
–
Obligations transferred as a result of
business combination
–
0
–
0
– 41
– 11
– 40
– 14
– – 7
– 13
– 5
Reversal (–)/addition (+)
65
10
67
20
Amount recognized in OCI
21
8
46
7
821
65
776
67
Pension and lump-sum amounts paid by the Company
Employer contributions to external funds
Pension provisions
Contributions in connection with deferred compensation in Germany are reported under
service cost. In 2011, these contributions amounted to EUR 3 million (2010: EUR 3 million).
The expense recognized in the income statement breaks down as follows:
in EUR million
Germany
Other
countries
Germany
Other
countries
2010
2011
2011
2010
Service cost
25
6
22
6
Interest expense
44
6
45
7
Expected return on external plan assets
– 4
– 4
– 3
– 4
–
Amortization of actuarial gains (–)/losses (+)
–
–
–
Amortization of past service cost
–
1
3
5
Expense (+)/income (–) from curtailment and settlement
–
–
–
6
–
–
–
0
65
9
67
20
Effect of asset limitation (IAS 19.58 (b))
Amount reported as expense (+)/income (–)
93
94
Service costs are recognized by function; the interest expense and expected return on external
plan assets are shown within net finance income/cost.
The reconciliation of benefit obligations and assets is as follows:
in EUR million
Present value of obligations at beginning of year
Germany
Other
countries
Germany
Other
countries
2011
2011
2010
2010
853
150
784
125
Service cost
25
6
22
6
Interest expense
44
6
45
7
Employee contributions
Actuarial gain (–)/loss (+)
–
1
–
1
15
6
44
9
–
–
–
7
– 16
Exchange rate effects
–46
– 13
– 45
Past service cost
Total amount of pensions and lump sums paid
–
1
3
5
Transfer values
0
0
0
–
Effect of curtailments and settlements
Present value of obligations at end of year
Fair value of plan assets at beginning of year
–
–
–
6
891
157
853
150
77
83
68
67
4
4
3
4
– 6
– 2
– 2
2
Expected return on external plan assets
Actuarial gain (+)/loss (–)
Exchange rate effects
–
2
–
5
Employer contributions to external pension funds
–
7
13
5
Employee contributions to external pension funds
Amounts of pension and lump sums paid by external funds
–
1
–
1
– 6
– 3
– 5
– 1
Effects of plan settlement
Fair value of plan assets at end of year
–
0
–
–
69
92
77
83
Germany
Other
countries
Germany
Other
countries
2011
2011
2010
2010
The actual return on external plan assets was as follows:
in EUR million
4
4
3
4
Actuarial gain (–)/loss (+)
Expected return on external plan assets
– 6
– 2
– 2
2
Actuarial return on external plan assets
– 2
2
1
6
For 2012, contributions paid to external funds are expected to total around EUR 6 million and
direct pension payments around EUR 43 million.
The amounts reported in OCI are as follows:
Germany
Other
countries
Germany
Other
countries
in EUR million
2011
2011
2010
2010
Actuarial gain (–)/loss (+)
– 21
– 8
– 46
– 7
–
–
–
0
Total amount for the year recognized in OCI
– 21
– 8
– 46
– 7
OCI
– 38
– 24
– 17
– 15
6
2
13
2
10
6
4
4
– 28
– 18
– 13
– 11
Effect of asset limitation (IAS 19.58 [b])
Deferred tax on actuarial gains (+)/losses (–)
Total recognized in equity
Net actuarial gains (+)/losses (–) reported in equity
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The actuarial gains and losses incurred are attributable to the following categories:
in EUR million
Difference between the expected and
the actual return on external plan assets
Germany
Other
countries
Germany
Other
countries
2011
2011
2010
2010
– 6
– 2
– 2
2
6
– 1
– 1
3
Adjustment due to changes in measurement assumptions
– 21
– 5
– 43
– 12
Total actuarial gain (+)/loss (–)
– 21
– 8
– 46
– 7
Difference between expected and actual amounts
The breakdown in prior reporting periods in accordance with IAS 19.120 A (p) was as follows:
in EUR million
Germany
Other
countries
Germany
Other
countries
Germany
Other
countries
2007
2009
2009
2008
2008
2007
Present value of pension obligations
784
125
777
110
809
117
Fair value of plan assets at end of year
– 68
– 67
– 67
– 57
– 66
– 65
Funding balance
716
58
710
53
743
52
– 1
2
– 3
– 10
0
0
4
0
–1
– 1
1
– 2
Difference between expected and actual return
on plan assets
Difference between expected and actual amounts
The reported plan assets break down as follows:
Values in %
Equities and other securities
Bonds
Real estate
Other assets
Total
Germany
Other
countries
Germany
Other
countries
2011
2011
2010
2010
4
38
12
42
43
38
42
36
4
10
6
10
49
14
40
12
100
100
100
100
The assumptions regarding the expected return on funds assets are made on the basis of
a uniform method, which in turn is based on the actual long-term returns of the past, the
portfolio structure and long-term returns expected in the future. The assumptions regarding
the expected return on the funds assets essentially remained unchanged for the 2011 and 2010
financial years.
The expected return on plan assets in Germany was assumed to be 5.0%. The expected return
on external plan assets for companies outside Germany ranges between 3.5% and 8.0%.
39.2% (2010: 43.0%) of the plan assets reported for Germany were invested in the sponsors of
the employee trust. These largely comprised pension trust (employee trust) receivables due
from BSH-D. As of December 31, 2011, the receivables stood at EUR 25 million (2010: EUR 29
million). In addition, the German plan assets include real estate leased to BSH companies with
a fair value of EUR 3 million (2010: EUR 4 million).
95
96
The calculation of the pension obligations and pension expense was based on the following
assumptions:
Values in %
Germany
Other
countries
Germany
Other
countries
2010
2011
2011
2010
Discount rate
5.3
4.5
5.3
4.7
Expected return on external plan assets
5.0
4.2
5.0
4.8
Salary inflation
3.0
3.8
3.0
3.9
Pension inflation
1.5
1.6
1.5
1.7
The measurement assumptions used for countries outside Germany are weighted averages.
The expected long-term return on investment is determined on the basis of publicly available
and internal capital market studies and forecasts.
In Germany, the 2005 Heubeck tables were used as the biometric basis for the calculations.
Employee turnover probabilities were estimated for specific age groups and genders.
26.2 Defined contribution plans
In 2011, the Company made contributions of EUR 102 million (2010: EUR 98 million) to defined
contribution plans (employer contributions to statutory pension insurance).
26.3 Partial retirement agreements and long-service bonus commitments
In some countries, BSH also has employee benefit obligations in connection with the termination of employment contracts and the payment of long-service bonuses. The scope of these
obligations amounted approximately to EUR 85 million at the end of 2011 (2010: EUR 92
million).
27Equity
The consolidated statement of changes in shareholders’ equity shows the changes in the BSH
Group’s equity and its components.
Retained earnings and reserves include the income earned in the past by the companies
included in the consolidated financial statements, insofar as they have not been paid as
dividends, and other recognized gains and losses. The development of retained earnings was
due to dividend distributions to shareholders as well as to a reduced consolidated net profit
compared with 2010. The executive management of BSH is proposing an appropriation of the
unappropriated profit of BSH-D as at December 31, 2011 in the form of a dividend distribution
of EUR 186.5 million in total.
The differences resulting from the translation of the financial statements of subsidiaries
outside Germany are reported under the currency translation reserve in OCI.
The reserve for available-for-sale financial assets includes the measurement gains or losses on
securities, net of deferred tax.
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The reserve for derivative financial instruments in connection with cash flow hedges includes
the measurement gains of losses on derivatives, net of deferred tax, to the extent that these
relate to the effective portion of the hedging relationship.
In accordance with IAS 19, the actuarial gains/losses item comprises actuarial gains/losses on
pension provisions (net of deferred tax) recognized directly in equity.
The paid-in capital and the net profit for the year generated by the sales companies whose
shares are held by Robert Bosch GmbH and Siemens AG, are shown in the balance sheet under
‘Non-controlling shareholders’. This item also includes the minority interest in the equity of
BSH Ev Aletleri Sanayi ve Ticaret A. Ş., Istanbul, BSH Home Appliances Services Ltd., Jeddah,
and Constructa-Neff Vertriebs-GmbH, Munich, including the proportion of profit or loss
attributable the minority shareholders. In 2010, the item ‘Non-controlling shareholders’ also
included BSW Household Appliances Co., Ltd., Wuxi.
BSH is not subject to any statutory requirements on minimum capital adequacy. As part of its
normal business activities, the Group maintains a reasonable equity ratio. BSH uses the
concept of economic value added as a basis for managing the business. The objective of
capital management is to maintain the Group’s external long-term rating, which, as in 2010,
Standard and Poor­’s rated “A” with stable outlook.
28 Notes to the statement of cash flow
The statement of cash flow reports how the BSH Group’s cash and cash equivalents changed
in the course of the year under review as a result of cash inflows and outflows. In accordance
with IAS 7 “Statement of Cash Flows”, a distinction is made between cash flows from operating, investment, and financing activities.
The statement of cash flow is determined using the indirect method starting from the net
income. The cash flows from operating activities are determined after applying adjustments for
non-cash income and expenses, primarily depreciation and amortization, and after taking into
account any changes in working capital. Investment activity comprises additions under
non-current assets and the purchase or sale of securities. Cash flows from financing activities
show cash inflows and outflows from the drawdown or repayment of financial liabilities and
from dividends.
The cash and cash equivalents reported in the statement of cash flow comprise cash on hand,
checks, and bank balances, providing they are available within three months. The effect of
exchange rate changes on cash and cash equivalents and the effect of changes in the consolidated group are reported separately. The changes in the balance sheet items reported in the
statement of cash flow cannot be directly reconciled to the balance sheet statement because
they have been adjusted for exchange rate effects. The exception to this is the figure for cash
and cash equivalents.
29 Financial instruments
In the BSH Group, financial instruments are generally classified as “loans and receivables” or
as “available for sale”. The non-derivative financial liabilities are assigned to other financial
liabilities. Derivative financial instruments are used to hedge future cash flows. Derivative
financial instruments not qualifying for hedge accounting are classified as “held for trading”.
Regular way purchases or sales of financial instruments are accounted for on the settlement
date.
97
98
Net gains/losses by category
in EUR million
Loans and receivables
Available-for-sale financial assets
Financial assets and financial liabilities
at fair value through profit or loss
Financial liabilities carried at amortized cost
2011
2010
70
20
0
18
– 8
– 44
– 156
– 5
The net gains/losses from the loans and receivables category include changes in write-downs,
gains and losses on derecognition and payments received, exchange rate gains and losses,
and the reversal of impairment losses or of gains/losses on derecognized loans and receivables.
Net gains and losses on the sale of available-for-sale financial assets comprise gains and
losses on the derecognition of available-for-sale financial assets and interest income from
these financial instruments. See the consolidated statement of changes in equity for disclosures on the amount of unrealized gains and losses on available-for-sale financial assets
recognized in OCI during the financial year, and the amount reclassified from OCI and recognized as income in the year.
Net gains or losses on financial assets and liabilities at fair value through profit or loss include
not only the effects of changes in fair value, but also interest expense or income from these
financial instruments.
The net expense from financial liabilities measured at amortized cost is made up of interest
expenses and currency gains and losses.
The information required under IFRS 7.20 (b) is shown in Note 9 “Finance income and finance
expense”. Information on impairment losses, as required by IFRS 7.20 (e), is contained, where
necessary, in the explanatory notes on items within the balance sheet and income statement.
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Carrying amounts and fair values by category
in EUR million
31.12.2011
Measurement
categories
IAS 39
Carrying
amount
31.12.2010
Fair value
Carrying
amount
Fair value
ASSETS
Cash and cash equivalents
n.a.1)
511
511
575
575
Trade accounts receivable
LaR
2,259
2,259
1,735
1,735
Other financial receivables
LaR
141
141
254
255
Available-for-sale financial assets
AfS
799
799
894
894
FAHfT
7
7
5
5
n.a.1)
1
1
3
3
FVTPL
18
18
6
6
Derivative financial assets not qualifying for hedge accounting
Derivative financial assets (hedge accounting)
Financial assets with embedded derivatives
LIABILITIES
Trade accounts payable
FLAC
1,100
1,100
1,020
1,020
Bonds
FLAC
244
235
0
0
Liabilities to banks
FLAC
807
869
533
599
Other financial liabilities
FLAC
303
303
398
398
Finance lease liabilities
n.a.1)
1
1
1
1
Derivative financial liabilities not qualifying for hedge accounting
FLHfT
12
12
5
5
Derivative financial liabilities (hedge accounting)
n.a.1)
4
4
2
2
Loans and receivables
LaR
2,400
2,400
1,989
1,990
Available-for-sale financial assets
AfS
799
799
894
894
FAHfT
7
7
5
5
2,017
Of which aggregated by measurement category
Financial assets at fair value through profit or loss
FLAC
2,454
2,507
1,951
Financial liabilities at fair value through profit or loss
Financial liabilities carried at amortized cost
FLHfT
12
12
5
5
Financial assets at fair value through profit or loss
FVTPL
18
18
6
6
298
298
212
212
773
773
655
655
Reconciliation to balance sheet
– Other non-financial receivables
(included in other current assets, securities and non-current financial assets)
– Other non-financial liabilities
(included in other current and non-current liabilities)
LaR
AfS
FAHfT
FLAC
FLHfT
FVTPL
1
Loans and receivables
Available-for-sale financial assets
Financial assets held for trading
Financial liabilities measured at amortized cost
Financial liabilities held for trading
Fair value through profit or loss
) n.a. not applicable
99
100
Financial instruments measured at fair value on the balance sheet
The following overview shows the allocation of our financial assets and liabilities measured at
fair value to the three levels of the fair value hierarchy:
Level 1:
Measurement using market prices observable in an active market for identical assets or
liabilities.
Level 2:
Measurement of assets or liabilities using prices for similar financial instruments that do not
fall under level 1. In this case, fair value can be determined either directly (e.g. prices) or
indirectly (e.g. derivation of prices).
Level 3:
This category covers all financial instruments that cannot be classified under level 1 or level 2
because no reliable market prices are available. In this case, special valuation techniques
must be used to determine the fair value of assets and liabilities.
in EUR million
31.12.2011
Level 1
Level 2
Level 3
Total
Financial assets measured at fair value
–
26
–
26
Available-for-sale financial assets
Derivative financial assets
799
–
–
799
Total
799
26
–
825
Financial liabilities measured at fair value
Derivative financial liabilities
–
16
–
16
Total
–
16
–
16
in EUR million
31.12.2010
Level 1
Level 2
Level 3
Total
Financial assets measured at fair value
Derivative financial assets
–
14
–
14
Available-for-sale financial assets
894
–
–
894
Total
894
14
–
908
Financial liabilities measured at fair value
Derivative financial liabilities
–
7
–
7
Total
–
7
–
7
There were no reclassifications between level 1 and level 2 in the year under review.
29.1 Non-derivative financial instruments
Available-for-sale financial instruments
Available-for-sale financial instruments are always reported at fair value. The fair value is
generally the market value. If there is no active market, fair value is determined using a
generally accepted valuation technique.
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Investments in non-consolidated subsidiaries and associates
Shares in non-consolidated subsidiaries and associates are always reported at cost; impairment losses are recognized where appropriate. There is no active market for these companies
and fair value cannot therefore be reliably determined with reasonable time and effort.
Loans/receivables and financial liabilities
Loans/receivables and financial liabilities are measured at amortized cost using the effective
interest method, provided they are not related to hedges. In particular, these are:
– Trade receivables and trade payables
– Liabilities to banks
– Bonds
– Other financial assets and liabilities
The amortized cost is calculated as the amount at which a financial asset or a financial
liability was measured on initial recognition, less any repayments, impairment losses, or
uncollectibility write-downs, and net of the premium/discount. The premium/discount is
allocated using the effective interest rate method over the life of the financial asset or liability.
For current receivables and liabilities, amortized cost equals the principal amount or the
settlement amount respectively.
Because of the Company’s customer structure, there is no substantial concentration of
payment default risk in reported receivables, nor is disclosure required.
29.2 Derivative financial instruments
Hedging policy and financial derivatives
The activities of BSH are also impacted by exchange rate fluctuations. It is the aim of the
Company’s business policies to limit these risks with hedging measures. Hedging transactions
are entered into exclusively with first-rate national and international banks. A limit is imposed
on transactions with each contract partner.
Binding internal rules and guidelines provide firm guidance on permitted actions and responsibilities for hedging, especially the hedging relationship with operating business and financial
investment or financing transactions. BSH does not use derivative financial instruments for
speculative purposes.
The Group employs the treasury control and value contribution monitor used in the finance unit
to control interest rate and currency management activities. These information systems are
used to support the identification and assessment of interest rate and currency risks throughout the Group for the next twelve months, based on planned cash flow. These activities are
subject to compliance with the minimum hedging rates stipulated in the Company’s financial
guidelines, and take into account the strategy laid down by the Treasury Committee, which
meets regularly under the chairmanship of a member of executive management.
If cash flow hedge accounting is applied, changes in the fair value of derivative financial
instruments are reported in equity as part of accumulated other comprehensive income. If
cash flow hedge accounting cannot be applied, the changes in fair value are recognized in the
income statement.
101
102
Currency risk
As a basis for controlling its exposure to currency risks, BSH primarily uses a Group-wide cash
flow reporting system, differentiated by currency; the subsidiaries outside Germany prepare
rolling monthly reports for headquarters.
Most of the hedging instruments used are forward exchange contracts; options are used in
some cases. To monitor the risks from financial derivatives, hedges are marked to market
on each bank working day; this valuation, plus additional information such as exchange
rate gains or losses and risks, is available to the employees concerned and to the relevant
managers.
The nominal volumes of the reported derivatives represent the total of purchase and selling
amounts on which the hedges are based.
Nominal volumes
in EUR million
2011
Maturity
Fair value
2010
2011
2010
–
6
5
1
–
1
0
–
3
–
0
0
–
99
–
1
3
408
2
200
–
11
4
24
46
–
24
0
1
74
–
26
–
1
0
0
–
12
–
0
0
120
6
80
–
4
2
up to 1 year
1 – 5 years
up to 1 year
1 – 5 years
234
18
227
Other interest rate derivatives
24
–
Share-based derivatives and options
34
13
Derivatives with positive fair values
– Foreign currency derivatives not qualifying
for hedge accounting
Currency forwards
– Interest rate and other derivatives not qualifying
for hedge accounting
– Foreign currency derivatives, hedge accounting
Currency forwards
Derivatives with negative fair values
– Foreign currency derivatives not qualifying
for hedge accounting
Currency forwards
Other foreign currency derivatives
– Interest rate and other derivatives not qualifying
for hedge accounting
Other interest rate derivatives
Share-based derivatives and options
– Foreign currency derivatives, hedge accounting
Currency forwards
The fair values disclosed in the above list were determined on the basis of information available on the balance sheet date. They represent the settlement amounts (redemption values) of
the financial derivatives. Redemption values are calculated on the basis of quoted prices and
standardized procedures. The maximum credit risk from derivative financial instruments is
limited to the total positive fair values in the event of default by a contract partner of BSH-D or
BSH Group companies.
Changes in the fair value of financial instruments from the hedging of planned transactions and
available-for-sale financial instruments are recognized in OCI under other recognized gains and
losses. As of December 31, 2011, EUR 20 million (2010: EUR 43 million) was included in OCI after
the deduction of deferred taxes. The effect of the cash flow hedges was to decrease equity by
EUR 2 million (2010: increase of EUR 1 million). In the course of the year under review, BSH sold
currency derivatives subject to hedge accounting. This resulted in the recognition of a net
income amount of EUR 4 million (2010: loss of EUR 3 million) under other operating income/
expense. As in 2010, no gains or losses were recognized from the remeasurement of ineffective
cash flow hedges for 2011.
N OT E S T O T H E B A L A N C E S H E E T | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
Fluctuations in market prices can create significant risks for the BSH Group. Changes in
exchange rates, interest rates, and share prices affect worldwide operating business, as well
as investment and financing activities. To represent these risks, IFRS calls for sensitivity
analyses which indicate the effects of hypothetical changes in relevant risk variables on profit
or loss and equity. The effects on the period concerned are determined by relating the hypothetical changes in the risk variables to the portfolio of financial instruments as of the reporting date. This assumes that the portfolio as of the reporting date is representative of the full
year.
BSH has implemented a system based on the sensitivity analysis, made up of various risk
analysis and risk management methods. The sensitivity analysis approximately quantifies the
risk that can occur subject to the given assumptions if particular parameters are changed to a
defined extent. The risk assessment here assumes:
– a parallel 10% decrease/increase in the exchange rate of the Russian ruble against the euro
– a parallel 10% decrease/increase in the exchange rate of the Pound sterling against the euro
– a parallel 10% decrease/increase in the exchange rate of the Turkish lira against the euro
– a parallel 10% decrease/increase in the exchange rate of the Chinese renminbi against the
euro
– a parallel shift in the yield curves for all currencies by 100 basis points (1 percentage point)
– a 10% rise or fall in the prices of all listed investments classified as available-for-sale
financial assets
The potential economic effects of this analysis represent estimates. They are based on the
assumption that the market changes implied within the framework of the sensitivity analysis
will materialize. As a result of the global market trends that occur in reality, the actual effects
on the consolidated income statement can differ significantly from these estimates.
More than half of BSH’s subsidiaries are located outside the eurozone. As the Group’s reporting currency is the euro, the company translates the financial statements of these companies
into euros. In order to address translation-related currency effects in risk management, BSH
applies the assumption that investments in foreign companies are in all cases long term in
nature, and the returns are continuously reinvested.
Translation-related effects resulting from changes in the value of net assets translated into
euros caused by exchange rate fluctuations are recognized in OCI in the BSH consolidated
financial statements; they are not included in the sensitivity analysis.
103
104
Foreign currency risks (revaluation)
RUB + 10%
in EUR million
31.12.2011
RUB – 10%
31.12.2010
31.12.2011
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
Cash and cash equivalents 1)
0
–
0
Trade accounts receivable 2)
11
–
0
Other assets FVTPL 3)
14
–
– 10
31.12.2010
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
–
0
–
0
–
–
– 11
–
0
–
8
–
– 14
–
– 8
–
–
– 6
–
10
–
6
–
15
0
2
0
– 15
0
– 2
0
Financial assets
Derivatives FVTPL
4)
Effect on financial assets
before tax
Financial liabilities
Derivatives FVTPL 4)
– 6
–
– 2
–
6
–
2
–
Trade accounts payable 5)
2
–
3
–
– 2
–
– 3
–
Financial liabilities 6)
0
–
1
–
0
–
– 1
–
Effect on financial liabilities
before tax
– 4
0
2
0
4
0
– 2
0
Total effect before tax
11
0
4
0
– 11
0
– 4
0
Foreign currency risks (revaluation)
GBP + 10%
in EUR million
31.12.2011
GBP – 10%
31.12.2010
31.12.2011
31.12.2010
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
Cash and cash equivalents 1)
1
–
0
–
– 1
–
0
–
Trade accounts receivable 2)
0
–
0
–
0
–
0
–
Other assets FVTPL 3)
0
–
0
–
0
–
0
–
Derivatives FVTPL 4)
0
–
–
–
0
–
–
–
Derivatives CFH
0
–
– – 7
0
–
– 7
1
0
0
– 7
– 1
0
0
7
–
Financial assets
7)
Effect on financial assets
before tax
Financial liabilities
Derivatives FVTPL 4)
– 2
–
5
–
2
–
– 5
Derivatives CFH 7)
–
– 10
–
– 8
–
10
–
8
Trade accounts payable 5)
0
–
6
–
0
–
– 6
–
Financial liabilities 6)
0
–
– 6
–
0
–
6
–
Effect on financial liabilities
before tax
–2
– 10
5
– 8
2
10
– 5
8
Total effect before tax
– 1
– 10
5
– 15
1
10
– 5
15
N OT E S T O T H E B A L A N C E S H E E T | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
Foreign currency risks (revaluation)
TRY + 10%
in EUR million
31.12.2011
TRY – 10%
31.12.2010
Effect on
income
Effect on
other trans­
actions in
equity
31.12.2011
31.12.2010
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
Financial assets
Cash and cash equivalents 1)
Trade accounts receivable 2)
Other assets FVTPL 3)
Derivatives FVTPL
4)
Effect on financial assets
before tax
0
–
0
–
0
–
0
–
– 6
–
– 6
–
6
–
6
–
9
–
3
–
– 9
–
– 3
–
– 7
–
– 5
–
7
–
5
–
– 4
0
– 8
0
4
0
8
0
Financial liabilities
Derivatives FVTPL 4)
– 2
–
2
–
2
–
– 2
–
Trade accounts payable 5)
6
–
5
–
– 6
–
– 5
–
Effect on financial liabilities
before tax
4
0
7
0
– 4
0
– 7
0
Total effect before tax
0
0
– 1
0
0
0
1
0
105
106
Foreign currency risks (revaluation) 8)
in EUR million
CNY + 10%
CNY – 10%
31.12.2011
31.12.2011
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
Cash and cash equivalents 1)
– 2
–
2
–
Trade accounts receivable 2)
– 2
–
2
–
Other assets FVTPL )
Financial assets
32
–
– 32
–
Derivatives FVTPL 4)
–
–
–
–
Derivatives CFH 7)
–
–
–
–
28
0
– 28
0
– 8
–
8
–
–
–
–
–
3
Effect on financial assets
before tax
Financial liabilities
Derivatives FVTPL 4)
Derivatives CFH 7)
Trade accounts payable
1
–
– 1
–
Financial liabilities 6)
– 24
–
24
–
Effect on financial liabilities
before tax
– 31
0
31
0
– 3
0
3
0
5)
Total effect before tax
AfS
FVTPL
CFH
Available-for-sale financial assets
Fair value through profit or loss
Cash flow hedge
Explanatory notes:
1
) Cash and cash equivalents comprises checks, cash on hand, and bank credit balances. The currency risk relates to remeasurement.
2
), 5) Trade accounts receivable and payable relate to both external and intercompany receivables and payables subject to remeasurement risk.
3
) Other assets relate in particular to intercompany loan receivables and cash pool amounts subject to remeasurement risk as a result of exchange rate fluctuations.
4
6
7
) Financial liabilities include both external borrowings and intercompany loan liabilities. The currency risk relates to remeasurement.
) Derivative instruments with hedge accounting (cash flow hedges) only include currency forwards. For the effective portion, the effect of exchange rate changes is thus recognized in OCI.
8
) Derivatives not qualifying for hedge accounting include currency forwards, currency options, stock index futures, currency swaps, and interest rate index futures. Any effect of the scenarios in question is recognized in the income statement.
) It was decided not to show the sensitivity of the Chinese renminbi (CNY) for the prior year, due to the substantially lower business volumes compared with 2011.
N OT E S T O T H E B A L A N C E S H E E T | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
Interest rate risk
In order to determine interest rate risk, BSH simulates a flat-rate 1% increase or cut in interest
rates. The changes in interest expense or income thus derive from the nominal volumes
concerned. Changes in the fair values of fixed-income securities and derivatives that react to
interest rates are determined by calculating the basis point value (1% = 100 BP).
Interest rate risk
+ 1%
in EUR million
31.12.2011
Effect on
income
– 1%
31.12.2010
Effect on
other trans­
actions in
equity
Effect on
income
31.12.2011
Effect on
other trans­
actions in
equity
Effect on
income
31.12.2010
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
Financial assets
Cash and cash equivalents 1)
5
–
6
–
– 5
–
– 6
–
Financial assets AfS 2)
–
– 14
–
– 16
–
14
–
16
Derivatives FVTPL 3)
2
–
0
–
–2
–
0
–
Effect on financial assets
before tax
7
– 14
6
– 16
– 7
14
– 6
16
Derivatives FVTPL 3)
0
–
2
–
0
–
– 2
–
Financial liabilities 4)
–1
–
– 1
–
1
–
1
–
Effect on financial liabilities
before tax
– 1
0
1
0
1
0
– 1
0
6
–14
7
– 16
–6
14
– 7
16
Financial liabilities
Total effect before tax
AfS
FVTPL
Available-for-sale financial assets
Fair value through profit or loss
Explanatory notes:
1
) Cash and cash equivalents comprises checks, cash on hand, and bank credit balances. A change in interest rates would result in increased/
reduced interest income based on the demand and fixed-term deposits and accounts with interest-bearing balances as of the reporting date.
2
3
4
) AfS financial assets specifically comprise securities. In the case of interest-bearing securities, a change in interest rates brings about a change in
market values, which is reflected in the revaluation reserve. Mutual funds in bonds and money market funds are not included. Stock funds and
mutual funds in stocks are in particular subject to other price risk, which is always recognized in the revaluation surplus. The simulation is
conducted through the income statement only if impairments have already been recognized through profit or loss.
) Derivatives not qualifying for hedge accounting include currency forwards, currency options, stock index futures, currency swaps, and interest
rate index futures. Any effect of the scenarios in question is recognized in the income statement.
) Financial liabilities include external borrowings. A change in interest rates would result in increased/reduced interest expense based on the
variable-interest liabilities as of the reporting date.
107
108
Commodity price risks
Group-wide hedging is required to counter the substantial fluctuations in commodity prices
and the resulting risks to earnings. In so far as is possible, the hedging is performed via
contractual agreements with suppliers. Unlike in 2010, the Group did not use any derivative
financial instruments to hedge against medium to long-term commodity price risks, but
instead used exchange traded commodities.
Other price risks
To determine other price risks, BSH simulates a 10% flat-rate increase or reduction in stock
prices, with the result that stock prices or the corresponding stock price indices (relative to the
mutual funds invested in stock funds or relative to the index futures concerned) are shown as
being 10% higher or lower.
Other price risks
+ 10% shares
in EUR million
31.12.2011
– 10% shares
31.12.2010
31.12.2011
31.12.2010
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
Effect on
income
Effect on
other trans­
actions in
equity
1
16
0
11
– 3
– 14
– 1
– 11
– 4
–
0
–
4
–
0
–
– 3
16
0
11
1
– 14
– 1
– 11
Derivatives FVTPL 2)
0
–
1
–
0
–
– 1
–
Effect on financial liabilities
before tax
0
0
1
0
0
0
– 1
0
–3
16
1
11
1
– 14
– 2
– 11
Financial assets
Financial assets AfS 1)
Derivatives FVTPL
2)
Effect on financial assets
before tax
Financial liabilities
Total effect before tax
AfS
FVTPL
Available-for-sale financial assets
Fair value through profit or loss
Explanatory notes:
) AfS financial assets specifically comprise securities. In the case of interest-bearing securities, a change in interest rates brings about a change in market values, which is reflected in the revaluation reserve. Mutual funds in bonds and money market funds are not included. Stock funds and mutual funds in stocks are in particular subject to other price risk, which is always recognized in the revaluation surplus. The simulation is conducted through the income statement only if impairments have already been recognized through profit or loss.
1
) Derivatives not qualifying for hedge accounting include currency forwards, currency options, stock index futures, currency swaps, and interest rate index futures. Any effect of the scenarios in question is recognized in the income statement.
2
N OT E S T O T H E B A L A N C E S H E E T | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
Credit and liquidity risk
The liquidity risk for the company consists in its possibly being unable to meet its financial
liabilities, for example the repayment of financial liabilities and the payment of purchase
commitments. BSH limits this risk by means of effective central cash management, global
access to lines of credit provided by prime-rated banks, and a syndicated credit line primarily
entered into for contingencies. A significant portion of the external bank loans has been taken
out over the long term, thus obviating short-term liquidity risks from repayment obligations.
To supplement the above-mentioned liquidity management tools, BSH continuously pursues
funding opportunities presented by the financial markets. In addition, the Group monitors
trends in the availability and cost of funding. A major objective is to secure BSH’s financial
flexibility and to limit unreasonable refinancing risks.
No defaults in connection with financial investments subject to credit risk had been identified
as of the reporting date.
The maximum credit risk is represented by the carrying amounts of financial assets reported
on the face of the balance sheet.
Disclosures under IFRS 7.13
As at December 31, 2011, the Group had submitted to banks notes receivable for discounting,
for which no deed of release had been obtained from the banks as of the reporting date. These
bills receivable were not derecognized, but were shown in the amount of EUR 92 million in
trade accounts receivable and current financial liabilities.
30Leases
The breakdown of future minimum lease payments under non-cancelable leases is as follows:
Due date for payments:
Less than 1 year
2011
2010
80
72
1 – 5 years
180
164
More than five years
103
71
Total
363
307
The minimum lease payments relate primarily to rents paid for real estate. Under rental
agreements and leases, minimum lease payments of EUR 85 million (2010: EUR 90 million)
and sublease payments of EUR 5 million (2010: EUR 5 million) were recognized in the income
statement in 2011.
The part of a property that the pension trust (employee trust) of BSH-D had sold to an investor
in 2007 was leased back in part in 2008 by the investor to a BSH Group company for a period
of ten years, with an option to extend twice by a period of five years. The remainder of the real
estate still owned by the employee trust has been leased to BSH companies on the basis of
longer-term leases.
109
110
31 Contingent liabilities and other financial commitments
No provisions have been set up for the following contingent liabilities and other financial commitments, recognized at their nominal values, because it is not deemed probable that the risk will
occur.
in EUR million
2011
2010
Guarantees and letters of comfort
2
2
Liabilities on notes
2
2
Other contingent liabilities
1
1
Total
5
5
32 Related party disclosures
The following companies or persons are related parties for BSH-D under IAS 24:
– Robert Bosch GmbH, Stuttgart, Germany
– Siemens AG, Munich and Berlin, Germany
– Companies directly or indirectly controlled by BSH-D
– Other consolidated and non-consolidated affiliated companies of the Robert Bosch Group
and the Siemens Group
– Members of the executive management or the Supervisory Board
–Members of the executive management, the Board of Management or the Supervisory Board
of Robert Bosch GmbH and Siemens AG
–Companies in which Robert Bosch GmbH, Siemens AG, or members of management hold a
significant portion of the voting rights
Transactions with these related parties are conducted on an arm’s length basis. The goods and
services bought from related parties include primarily production supplies and sales services,
and a small volume of training and other services. The goods and services supplied to related
parties primarily involve the sale of home appliances. Most of these transactions are conducted
by the companies in Germany.
in EUR million
2011
Robert
Bosch
Group
2010
Siemens
Group
Robert
Bosch
Group
Siemens
Group
Receivables
0
0
0
0
Liabilities
1
5
2
6
Revenue
2
8
2
0
N OT E S T O T H E B A L A N C E S H E E T | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
33 Remuneration of members of the executive management and the Supervisory Board
The remuneration paid to the Supervisory Board amounted to EUR 0.1 million (2010: EUR 0.1
million); executive management remuneration amounted to EUR 3.4 million (2010: EUR 3.8
million). Former members of executive management and their surviving dependents received
payments of EUR 1.6 million, including pensions and transitional payments (2010: EUR 1.7
million). As of December 31, 2011, provisions amounting to EUR 21.0 million (2010: 20.7 million)
were recognized for pensions and benefit entitlements for these persons.
In the financial year, as in the previous year, there were no loans to members of the executive
management or the Supervisory Board. The members of the executive management and the
Supervisory Board are listed in the annexes.
34 Auditor fees and services in accordance with section 314 HGB
Deloitte & Touche GmbH Wirtschaftsprüfungsgesellschaft, Munich, was paid the following
fees for services performed during the year under review:
in EUR million
2011
2010
a) Financial statements auditing services
0.4
0.4
b) Other attestation services
0.7
0.9
c) Tax consultancy services
0.0
0.0
d) Other services
0.3
0.5
Total
1.4
1.8
Item a) comprises the fees for the statutory audits of annual financial statements for the
German companies and the audit of the consolidated financial statements of BSH for the year
ended December 31, 2011.
Item b) comprises for the most part the fees for the auditor’s review of interim financial
statements for the periods ending June 30, 2011 and September 30, 2011 as well as attestation
services in connection with the review of IT systems and the provision of a comfort letter.
Item c) comprises a very small number of tax consultancy services.
Item d) comprises for the most part project support services for IT license management
processes. In 2010, this mainly comprised services for due diligence as part of selling and
buying processes.
Munich, March 28, 2012
BSH Bosch und Siemens Hausgeräte GmbH
Executive Management
111
112
Annex I
Consolidated Statement of Changes in Fixed Assets
January 1 to December 31, 2011
Acquisition and manufacturing costs
in EUR million
I. Property, plant and equipment
Note
01.01.2011
Foreign currency
movements
Additions
Disposals
Reclassification
31.12.2011
20
Land and buildings
855
– 7
28
9
17
884
Technical equipment and machinery
1,572
– 21
67
50
66
1,634
Other equipment, operating
and office equipment
1,387
– 13
120
66
47
1,475
132
– 1
157
0
– 88
200
Assets under construction
Advance payments on property,
plant and equipment
II. Intangible assets
77
– 1
64
5
– 42
93
4,023
– 43
436
130
0
4,286
21
Purchased intangible assets
Patents, licenses, brand names,
customer bases, etc.
(excl. software)
71
2
0
0
0
73
Software
80
0
9
2
– 1
86
Goodwill
191
– 25
0
0
0
166
0
0
7
0
0
7
342
– 23
16
2
– 1
332
Advance payments on
intangible assets
Internally generated intangible assets
Patents, licenses, etc.
(excl. software)
0
0
0
0
0
0
43
0
1
0
1
45
Development expenditure
3
0
0
0
3
6
Intangible assets being created
6
0
0
0
– 3
3
Software
1
52
0
1
0
1
54
4,417
– 66
453
132
0
4,672
) Included are impairment losses on property, plant and equipment of EUR 11 million.
CO NS O L I DAT E D S TAT E M E N T O F C H A N G E S I N F I X E D A SS E T S | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
Depreciation and amortization
01.01.2011
Foreign currency
movements
Current
year 1)
Disposals
Carrying
amounts
31.12.2011
Reclassification
Reversals
31.12.2011
397
– 2
37
7
0
0
425
459
1,085
– 14
107
47
0
0
1,131
503
1,001
– 8
136
59
0
0
1,070
405
4
0
1
0
0
0
5
195
0
0
0
0
0
0
0
93
2,487
– 24
281
113
0
0
2,631
1,655
31
36
3
3
0
0
0
42
66
0
7
2
– 1
0
70
16
6
0
0
0
0
0
6
160
0
0
0
0
0
0
0
7
108
3
10
2
– 1
0
118
214
0
0
0
0
0
0
0
0
22
0
4
0
1
0
27
18
3
0
1
0
0
0
4
2
0
0
0
0
0
0
0
3
25
0
5
0
1
0
31
23
2,620
– 21
296
115
0
0
2,780
1,892
113
114
Consolidated Statement of Changes in Fixed Assets
January 1 to December 31, 2010
Acquisition and manufacturing costs
in EUR million
I. Property, plant and equipment
Note
01.01.2010
Foreign currency
movements
Additions
Disposals
Reclassification
31.12.2010
20
Land and buildings
800
23
28
9
13
855
Technical equipment and machinery
1,488
38
72
117
91
1,572
Other equipment, operating and
office equipment
1,370
25
100
136
28
1,387
95
1
123
0
– 87
132
Assets under construction
Advance payments on property,
plant and equipment
II. Intangible assets
52
2
68
0
–45
77
3,805
89
391
262
0
4,023
21
Purchased intangible assets
Patents, licenses, brand names,
customer bases, etc.
(excl. software)
69 1)
2
0
0
0
71
Software
76
1
6
3
0
80
Goodwill
181 1)
10
0
0
0
191
Advance payments on
intangible assets
0
0
0
0
0
0
326
13
6
3
0
342
43
Internally generated intangible assets
36
0
3
0
4
Development expenditure
Software
3
0
0
0
0
3
Intangible assets being created
7
0
3
0
– 4
6
46
0
6
0
0
52
4,177
102
403
265
0
4,417
1
) Reclassification of a brand name amounting to EUR 17 million from goodwill as patents, licenses, brand names, customer bases, etc. (excl. software).
2
3
) Reclassification of a brand name amounting to EUR 5 million from goodwill as patents, licenses, brand names, customer bases, etc. (excl. software).
) Including impairment losses on property, plant and equipment of EUR 14 million.
CO NS O L I DAT E D S TAT E M E N T O F C H A N G E S I N F I X E D A SS E T S | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
Depreciation and amortization
01.01.2010
Foreign currency
movements
Current
year 3)
Carrying
amount
31.12.2010
Disposals
Reclassification
Reversals
31.12.2010
361
8
33
6
1
0
397
458
1,064
22
105
115
9
0
1,085
487
983
15
141
129
– 9
0
1,001
386
2
0
4
0
– 1
1
4
128
0
0
0
0
0
0
0
77
2,410
45
283
250
0
1
2,487
1,536
35 2)
0
3
0
0
2
36
35
61
1
7
3
0
0
66
14
4
2)
2
0
0
0
0
6
185
0
0
0
0
0
0
0
0
100
3
10
3
0
2
108
234
18
0
4
0
0
0
22
21
2
0
1
0
0
0
3
0
0
0
0
0
0
0
0
6
20
0
5
0
0
0
25
27
2,530
48
298
253
0
3
2,620
1,797
115
116
Annex II
Shareholdings of BSH Bosch und Siemens Hausgeräte GmbH
as of December 31, 2011
Shareholding (%)
Shareholding (%)
Companies included in the consolidated
financial statements as specified by IAS 27.12
South America
BSH Electrodomésticos S.A.C., Callao-Lima
100
Germany
Briky S.A., Montevideo
100
Constructa-Neff Vertriebs-GmbH, Munich
50
Asia/Oceania
Neff GmbH, Munich
100
BSH Hausgeräte Service GmbH, Munich
100
BSH Home Appliances Holding (China) Co., Ltd.,
Nanjing
100
BSH Hausgerätewerk Nauen GmbH, Nauen
100
BSH Home Appliances Co., Ltd., Chuzhou
100
BSH Hausgeräte Service Nauen GmbH, Nauen
100
Gaggenau Hausgeräte GmbH, Munich
100
BSH Home Appliances Service Jiangsu Co., Ltd.,
Nanjing
100
100
BSH Home Appliances (China) Co., Ltd., Nanjing
100
100
BSH Electrical Appliances (Jiangsu) Co., Ltd.,
Nanjing
100
BSH Home Appliances S.A., Brussels
100
BSH Electrical Appliances (Anhui) Co., Ltd.,
Chuzhou
100
BSH Hvidevarer A/S, Ballerup
100
BSW Household Appliances Co., Ltd., Wuxi
100
BSH Kodinkoneet Oy, Helsinki
100
BSH Home Appliances Ltd., Hong Kong
100
BSH Electroménager S.A.S., Saint Ouen
100
BSH Home Appliances Limited, Yongin-City
100
Gaggenau Industrie S.A.S., Lipsheim
100
BSH Home Appliances Ltd., Tel Aviv
100
BSH Ikiakes Syskeves A.B.E., Athens
100
BSH Home Appliances Sdn. Bhd., Kuala Lumpur
100
BSH Home Appliances Limited, Milton Keynes
100
BSH Home Appliances Pte. Ltd., Singapore
100
BSH Elettrodomestici S.p.A., Milan
100
BSH Huishoudapparaten B.V., Amsterdam
100
BSH Home Appliances Pty. Ltd., Heatherton,
Victoria
100
BSH Electroménagers S.A., Luxembourg
100
BSH Home Appliances Ltd., Auckland
100
BSH Husholdningsapparater A/S, Oslo
100
BSH Home Appliances Ltd., Bangkok
100
BSH Hausgeräte Gesellschaft mbH, Vienna
100
BSH Home Appliances Holding GmbH, Vienna
100
BSH Home Appliances Manufacturing Ltd.,
Kabinburi
100
100
BSH Home Appliances FZE, Dubai
100
BSH Vermögensverwaltungs-GmbH, Munich
BSH Hausgeräte Vertriebs GmbH, Munich
Europe
BSH Finance Management GmbH, Vienna
BSH Home Appliances Saudi Arabia LLC, Jeddah
51
BSH Sprzet Gospodarstwa Domowego
Sp.z o.o., Warsaw
100
BSH Home Appliances Private Limited, Mumbai
100
BSHP Electrodomésticos, S.U., Lda., Carnaxide
100
BSH Electrocasnice S.R.L., Bucharest
100
BSH Household Appliances Manufacturing
Private Limited, Mumbai
100
OOO BSH Bytowaja Technika, Moscow
100
Africa
OOO BSH Bytovye Pribory, St. Petersburg
100
BSH Electroménagers (SA), Casablanca
100
BSH Home Appliances AB, Stockholm
100
BSH Home Appliances (Pty) Ltd., Johannesburg
100
BSH Hausgeräte AG, Geroldswil
100
BSH Drives and Pumps s.r.o., Michalovce
100
Companies included in the consolidated
financial statements in accordance with IAS
27.13 (b)
BSH Hišni Aparati d.o.o., Nazarje
100
Robert Bosch Hausgeräte GmbH, Munich
–
BSH Electrodomésticos España, S.A., Huarte
100
Siemens-Electrogeräte GmbH, Munich
–
BSH domácí spotřebiče s.r.o., Prague
100
CONSTRUCTA GmbH, Munich
–
BSH Ev Aletleri Sanayi ve Ticaret A.Ş., Istanbul
99.28
TOV BSH Pobutova Technika, Kiev
100
Companies not included in the consolidated
financial statements as specified by IAS 27.13
BSH Háztartási Készülék Kereskedelmi Kft.,
Budapest
100
BSH Bosch und Siemens Hausgeräte
Altersfürsorge GmbH, Munich
BSH Home Appliances Ltd./Électroménagers
BSH Ltée, Mississauga
BSH Electrodomésticos S.A. de C.V.,
Mexico City
BSH Home Appliance Corporation,
Huntington Beach/New Bern
100
Companies not included in the consolidated
financial statements due to immateriality:
North America
100
100
100
South America
BSH Electrodomésticos S.A., Buenos Aires
100
BSH Participações Ltda., São Paulo
100
BSH I.D. Invalidska družba d.o.o., Nazarje
100
BSH Home Appliances Sarl, Tunis
100
BSH kucanski uredaji d.o.o. za usluge, Zagreb
100
BSH KUCNI APARATI d.o.o. Beograd, Beograd
100
BSH Domakinski Uredi Bulgaria EOOD, Sofia
100
Plus one subsidiary without business
operations
Profilo Elektrogeräte-Vertriebsgesellschaft
mbH, Munich
100
2
I N D E P E N D E N T A U D I T O R S ’ R E P O R T | N OT E S T O T H E CO NS O L I DAT E D F I N A N C I A L S TAT E M E N T S
| Contents
| Independent Auditors’ Report
We have audited the consolidated financial statements prepared by BSH Bosch und Siemens
Hausgeräte GmbH, Munich, comprising the balance sheet, the income statement and statement of comprehensive income, the cash flow statement, the statement of changes in equity
and the notes to the consolidated financial statements, and management report for the business year from January 1 to December 31, 2011. The preparation of the consolidated financial
statements and group management report according to the International Financial Reporting
Standards (IFRS), as adopted by the European Union (EU), and the additional requirements of
German commercial law pursuant to § 315a (1) HGB (German Commercial Code) are the responsibility of the parent company’s management. Our responsibility is to express an opinion
on the consolidated financial statements and on the group management report based on our
audit.
8
12
4| Foreword
8|
The Art of Coffee
At the BSH plant in Traunreut, Bavaria, Andreas Liebl and his team
busy themselves perfecting the technology to create expert espresso,
with an optimum crema on top. With the passion of an Italian barista,
the team strive to get the best aroma from their beans.
12| Cultural Program
At the BSH Technology Center for Laundry Care in Berlin, Kathrin
Redlin creates washing cycles for a globalized world. Because laundry
habits vary from culture to culture.
16| Follow the Trail
At BSH in Bad Neustadt, Bavaria, Roland Illig and his team are on the
trail of lost energy in the Floor Care Development Center. Their detective work has uncovered a particularly efficient vacuum cleaner.
20| Globetrotters
Across China by freight train: Christoph Rohr knows the stresses BSH appliances must endure. He uses his understanding to develop the ideal packaging.
24| A Source of Inspiration
At the BSH site in Hoofddorp, near Amsterdam, Ronald Wassenaar re­
volutionizes the kitchen-planning process. He and his team of advisors
cater to customers’ individual wishes so they find the appliances that
best fit their desires. Afterwards they plan the rest of the kitchen.
We conducted our audit of the consolidated financial statements in accordance with § 317 HGB
and German generally accepted standards for the audit of financial statements promulgated
by the Institut der Wirtschaftsprüfer (Institute of Public Auditors in Germany). Those standards
require that we plan and perform the audit such that misstatements materially affecting the
presentation of the net assets, financial position, and results of operations in the consolidated
financial statements in accordance with the applicable financial reporting framework and
in the group management report are detected with reasonable assurance. Knowledge of the
business activities and the economic and legal environment of the Group and expectations
as to possible misstatements are taken into account in the determination of audit procedures.
The effectiveness of the accounting-related internal control system and the evidence supporting the disclosures in the consolidated financial statements and the group management
report
are examined primarily on a test basis within the framework of the audit. The audit includes
assessing the annual financial statements of those entities included in consolidation, the determination of entities to be included in consolidation, the accounting and consolidation principles used, and significant estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements and the group management report. We
believe that our audit provides a reasonable basis for our opinion.
Our audit has not led to any reservations.
In our opinion, based on the findings of our audit, the consolidated financial statements of
BSH Bosch und Siemens Hausgeräte GmbH, Munich, comply with IFRS, as adopted by the EU,
the additional requirements of German commercial law pursuant to § 315a (1) HGB and give
a true and fair view of the net assets, financial position and results of operations of the group
in accordance with these requirements. The group management report is consistent with the
consolidated financial statements and as a whole provides a suitable view of the group’s position and suitably presents the opportunities and risks of future development.
Munich, April 5, 2012
Deloitte & Touche GmbH
Wirtschaftsprüfungsgesellschaft
(Prof. Dr. Plendl) Wirtschaftsprüfer (German Public Auditor)
(Prosig)
Wirtschaftsprüfer
(German Public Auditor)
117
118
Total Commitment. Top Performance. With Responsibility.
Excellent, committed employees are what characterizes BSH Bosch
und Siemens Hausgeräte GmbH, today more than ever. They are the
power behind the strong performance of our products and solutions
and therefore form the foundation for our economic success. It is one
of our fundamental principles, which we have internalized, that every­thing we do must demonstrate our commitment to society and the
environment. Our Annual and Sustainability Reports will show how
economic success and responsible action are mutually interdependent.
Both reports are available as pdf versions on the Internet at:
www.bsh-group.com
| B S H st a y s th e c o u r s e
In what was a difficult financial year, BSH once again managed to exceed its
The latest Sustainability Report will be available from mid-June 2012.
revenue expectations and generate positive earnings. This confirms that we
have embarked on the right path. Thanks to the development of attractive
home appliances that deliver top performance with low energy consumption,
we can stay on track even in turbulent times.
BSH Bosch und Siemens Hausgeräte GmbH
Carl-Wery-Strasse 34, 81739 Munich, Germany
Tel. +49 89 4590-01
Fax +49 89 4590-2347
www.bsh-group.com
Media contact:
Corporate Communications
Tel. +49 89 4590-2809
Fax +49 89 4590-2128
corporate.communications@bshg.com
The Annual Report and the following further publications
are available in German and English:
• Sustainability Report 2011
• Our Super Efficiency Portfolio 2011
• BSH at a Glance 2012
This report was printed climate neutrally on FSC-certified
Hello Silk paper.
Right of amendment reserved, errors excepted.
Printed in Germany. May 2012.
© BSH Bosch und Siemens Hausgeräte GmbH.
Reproduction and use in all media, whether complete or in
part, subject to approval.
| Summary of Past Performance
| Key Figures
in EUR million
2011
2010
2009
2008
2007
2006
2005
Sales revenue
9,654
9,073
8,405
8,758
8,818
8,308
7,340
6
8
– 4
– 1
6
13
7
79
79
78
80
81
78
78
45.6
42.8
39.6
40.3
39.0
38.0
35.5
1,893
1,807
1,688
1,646
1,663
1,480
1,411
Capital expenditure on fixed assets**
453
403
294
382
378
358
333
As percentage of sales revenue
4.7
4.4
3.5
4.4
4.3
4.3
4.5
Depreciation, amortization and
impairment losses on fixed assets**
296
298
320
299
257
281
223
As percentage of capital expenditure
65
74
109
78
68
78
67
7,435
6,901
6,443
6,173
6,276
5,950
5,325
Year-to-year change in %
International sales revenue proportion (%)
Employees
(in thousands at 01.01. of the
following year)
Personnel expenses*
Balance sheet total
Fixed assets and non-current financial
assets
2,655
2,688
2,496
2,349
2,374
2,259
Group A nnual Repor t 2011
BSH Bosch und Siemens Hausgeräte GmbH (Group)
Group Annual Report 2011
Total Commitment. Top Performance.
1,957
in EUR million
2011
2010
Sales revenue
9,654
9,073
Year-to-year change in %
6
8
79
79
EBITDA *
943
1,052
EBIT *
647
754
Profit before tax
538
691
Consolidated net profit
373
465
Capital expenditure on fixed assets**
453
403
As percentage of sales revenue
4.7
4.4
Depreciation, amortization and impairment losses on fixed assets**
296
298
65
74
Balance sheet total
7,435
6,901
Equity
2,409
2,408
32
35
International sales revenue proportion (%)
1,305
1,226
1,032
1,074
1,103
1,019
828
Trade receivables from sales
of goods and services and other
current assets
2,691
2,199
1,954
2,031
2,053
2,052
1,655
Equity
2,409
2,408
2,535
2,396
2,372
2,057
1,859
32
35
39
39
38
35
35
As percentage of total equity and liabilities
Provisions
1,760
1,857
1,702
1,593
1,673
1,709
1,581
EBITDA*
943
1,052
905
867
949
868
768
EBIT*
647
754
585
568
692
587
542
Profit before tax
Consolidated net profit
538
373
691
465
517
324
510
311
637
411
542
372
500
386
*2005 – 2010 values after adjusting the reporting of interest expense and income from plan assets from pension, semi-retirement and long service bonus obligations.
See the Notes to the Consolidated Financial Statements for further explanations.
** Excluding goodwill.
B S H B O S C H U N D S I E M E N S H A U S G E R ÄT E G M B H
Inventories
As percentage of capital investment
As percentage of total equity and liabilities
*2010 values after adjusting the reporting of interest expenditure and income from plan assets from pension, semi-retirement and long service
bonus obligations. See the Notes to the Consolidated Financial Statements for further explanations.
** Excluding goodwill.
B S H B O S C H U N D S I E M E N S H A U S G E R ÄT E G M B H
BSH Bosch und Siemens Hausgeräte GmbH
BSH Bosch und Siemens Hausgeräte GmbH
was founded in 1967 as a joint venture between Robert Bosch GmbH, Stuttgart, and Siemens AG, Berlin/Munich. The company is now
the third-largest home appliances manufacturer worldwide, and number one in Europe,
with sales of EUR 9.654 billion in 2011.
The Group’s product portfolio spans the
entire spectrum of modern domestic appliances. It ranges from stoves, ovens and
extractor hoods to dishwashers, washers and
dryers, fridges and freezers to small appliances (Consumer Products) such as vacuum
cleaners, coffee machines, kettles, irons and
hairdryers.
On December 31, 2011 the Munich-based
group had 42 factories across Europe, Asia
llflächeninduktions-Kochfeld CX 480.
and North America as well as a global network of sales and customer service outlets
in almost 50 countries. BSH employed over
45,600 people in 2011, with over 70 percent
of these in Europe.
In spring 2012, BSH was ranked as a top
employer in Germany by the CRF Institute
in the sixth consecutive year; the company
also achieved this top accolade for the first
time in Poland and the Netherlands. BSH was
awarded first place in the innovation management category of the top employer ranking for
engineers.
Main Brands
Special Brands
Regional Brands
Bosch and Siemens: these two
brands are known worldwide and
have a long history, underpinning
our international success. Bosch
stands for reliable, durable products; Siemens stands for innovation, leading-edge technology and
quality design.
The BSH brand portfolio includes
the special brands Gaggenau
and Neff, Thermador, Constructa,
Viva, Ufesa and Junker. These
ensure we meet the wide-ranging
requirements of our various customers.
Regional brands are the market
leaders which garner respect in
their countries of origin. Brands
with which our regional consumers
particularly identify include Balay
in Spain, Pitsos in Greece, Profilo
in Turkey and Coldex in Peru. Such
brands help strengthen BSH’s
position in these countries.
| BSH Worldwide
• Helsinki
Oslo •
Environmental and climate protection have
always been firmly anchored in the Group‘s
corporate strategy. BSH’s energy- and watersaving household appliances contribute to
the efficient use of resources. We have listed
our most efficient appliances in a Super Efficiency Portfolio since 2009. BSH has also
set itself a 2015 target to reduce resource use
in manufacturing and administration by 25
percent.
• St. Petersburg
• Stockholm
• Moscow
• Ballerup
TM
TM
• Toronto
Irvine
 New Bern
•
La Follette 
Casablanca •
• Tel Aviv
• Dubai
• Jeddah
• Mumbai
• Mexico City
Chuzhou 
• Seoul
• Nanjing
 Wuxi
Milton Keynes •
• Hong Kong
 Kabinburi
• Bangkok
• Amsterdam
Nauen 
Brussels •
 Berlin
• Warsaw
 Lódź
• Kiev
Bad Neustadt 
• Prague
Luxembourg •
 Bretten
• Michalovce
Giengen  • Regensburg
Paris •
Munich
Lipsheim Dillingen  
 Traunreut• Vienna• Budapest
Geroldswil •
• Kuala Lumpur
• Singapore
 Lima
• Nazarje
• São Paulo
Buenos Aires • • Montevideo
Milan •
• Johannesburg
Melbourne •
Auckland •
Santander 
Vitoria  • Huarte
Estella   Esquiroz
Zaragoza •  La Cartuja
 Montañana
• Bucharest
Çerkezköy  • Istanbul
• Lisbon
• Athens
Flexibilität und Freizügigkeit. Mit dem Vollflächeninduktions-Kochfeld CX 480 von Gaggenau ist erstmals die gesamte
Kochzone nutzbar. Das Kochgeschirr wird automatisch erkannt und dort erhitzt, wo es gerade steht.
Group Headquarters
• Subsidiaries
Factories:
 Cooking
 Refrigeration/Freezing
 Dishwashing
 Washing/Drying
 Consumer Products
 Motors, pumps
BSH Bosch und Siemens Hausgeräte GmbH
BSH Bosch und Siemens Hausgeräte GmbH
was founded in 1967 as a joint venture between Robert Bosch GmbH, Stuttgart, and Siemens AG, Berlin/Munich. The company is now
the third-largest home appliances manufacturer worldwide, and number one in Europe,
with sales of EUR 9.654 billion in 2011.
The Group’s product portfolio spans the
entire spectrum of modern domestic appliances. It ranges from stoves, ovens and
extractor hoods to dishwashers, washers and
dryers, fridges and freezers to small appliances (Consumer Products) such as vacuum
cleaners, coffee machines, kettles, irons and
hairdryers.
On December 31, 2011 the Munich-based
group had 42 factories across Europe, Asia
llflächeninduktions-Kochfeld CX 480.
and North America as well as a global network of sales and customer service outlets
in almost 50 countries. BSH employed over
45,600 people in 2011, with over 70 percent
of these in Europe.
In spring 2012, BSH was ranked as a top
employer in Germany by the CRF Institute
in the sixth consecutive year; the company
also achieved this top accolade for the first
time in Poland and the Netherlands. BSH was
awarded first place in the innovation management category of the top employer ranking for
engineers.
Main Brands
Special Brands
Regional Brands
Bosch and Siemens: these two
brands are known worldwide and
have a long history, underpinning
our international success. Bosch
stands for reliable, durable products; Siemens stands for innovation, leading-edge technology and
quality design.
The BSH brand portfolio includes
the special brands Gaggenau
and Neff, Thermador, Constructa,
Viva, Ufesa and Junker. These
ensure we meet the wide-ranging
requirements of our various customers.
Regional brands are the market
leaders which garner respect in
their countries of origin. Brands
with which our regional consumers
particularly identify include Balay
in Spain, Pitsos in Greece, Profilo
in Turkey and Coldex in Peru. Such
brands help strengthen BSH’s
position in these countries.
| BSH Worldwide
• Helsinki
Oslo •
Environmental and climate protection have
always been firmly anchored in the Group‘s
corporate strategy. BSH’s energy- and watersaving household appliances contribute to
the efficient use of resources. We have listed
our most efficient appliances in a Super Efficiency Portfolio since 2009. BSH has also
set itself a 2015 target to reduce resource use
in manufacturing and administration by 25
percent.
• St. Petersburg
• Stockholm
• Moscow
• Ballerup
TM
TM
• Toronto
Irvine
 New Bern
•
La Follette 
Casablanca •
• Tel Aviv
• Dubai
• Jeddah
• Mumbai
• Mexico City
Chuzhou 
• Seoul
• Nanjing
 Wuxi
Milton Keynes •
• Hong Kong
 Kabinburi
• Bangkok
• Amsterdam
Nauen 
Brussels •
 Berlin
• Warsaw
 Lódź
• Kiev
Bad Neustadt 
• Prague
Luxembourg •
 Bretten
• Michalovce
Giengen  • Regensburg
Paris •
Munich
Lipsheim Dillingen  
 Traunreut• Vienna• Budapest
Geroldswil •
• Kuala Lumpur
• Singapore
 Lima
• Nazarje
• São Paulo
Buenos Aires • • Montevideo
Milan •
• Johannesburg
Melbourne •
Auckland •
Santander 
Vitoria  • Huarte
Estella   Esquiroz
Zaragoza •  La Cartuja
 Montañana
• Bucharest
Çerkezköy  • Istanbul
• Lisbon
• Athens
Flexibilität und Freizügigkeit. Mit dem Vollflächeninduktions-Kochfeld CX 480 von Gaggenau ist erstmals die gesamte
Kochzone nutzbar. Das Kochgeschirr wird automatisch erkannt und dort erhitzt, wo es gerade steht.
Group Headquarters
• Subsidiaries
Factories:
 Cooking
 Refrigeration/Freezing
 Dishwashing
 Washing/Drying
 Consumer Products
 Motors, pumps
| Summary of Past Performance
| Key Figures
in EUR million
2011
2010
2009
2008
2007
2006
2005
Sales revenue
9,654
9,073
8,405
8,758
8,818
8,308
7,340
6
8
– 4
– 1
6
13
7
79
79
78
80
81
78
78
45.6
42.8
39.6
40.3
39.0
38.0
35.5
1,893
1,807
1,688
1,646
1,663
1,480
1,411
Capital expenditure on fixed assets**
453
403
294
382
378
358
333
As percentage of sales revenue
4.7
4.4
3.5
4.4
4.3
4.3
4.5
Depreciation, amortization and
impairment losses on fixed assets**
296
298
320
299
257
281
223
As percentage of capital expenditure
65
74
109
78
68
78
67
7,435
6,901
6,443
6,173
6,276
5,950
5,325
Year-to-year change in %
International sales revenue proportion (%)
Employees
(in thousands at 01.01. of the
following year)
Personnel expenses*
Balance sheet total
Fixed assets and non-current financial
assets
2,655
2,688
2,496
2,349
2,374
2,259
Group A nnual Repor t 2011
BSH Bosch und Siemens Hausgeräte GmbH (Group)
Group Annual Report 2011
Total Commitment. Top Performance.
1,957
in EUR million
2011
2010
Sales revenue
9,654
9,073
Year-to-year change in %
6
8
79
79
EBITDA *
943
1,052
EBIT *
647
754
Profit before tax
538
691
Consolidated net profit
373
465
Capital expenditure on fixed assets**
453
403
As percentage of sales revenue
4.7
4.4
Depreciation, amortization and impairment losses on fixed assets**
296
298
65
74
Balance sheet total
7,435
6,901
Equity
2,409
2,408
32
35
International sales revenue proportion (%)
1,305
1,226
1,032
1,074
1,103
1,019
828
Trade receivables from sales
of goods and services and other
current assets
2,691
2,199
1,954
2,031
2,053
2,052
1,655
Equity
2,409
2,408
2,535
2,396
2,372
2,057
1,859
32
35
39
39
38
35
35
As percentage of total equity and liabilities
Provisions
1,760
1,857
1,702
1,593
1,673
1,709
1,581
EBITDA*
943
1,052
905
867
949
868
768
EBIT*
647
754
585
568
692
587
542
Profit before tax
Consolidated net profit
538
373
691
465
517
324
510
311
637
411
542
372
500
386
*2005 – 2010 values after adjusting the reporting of interest expense and income from plan assets from pension, semi-retirement and long service bonus obligations.
See the Notes to the Consolidated Financial Statements for further explanations.
** Excluding goodwill.
B S H B O S C H U N D S I E M E N S H A U S G E R ÄT E G M B H
Inventories
As percentage of capital investment
As percentage of total equity and liabilities
*2010 values after adjusting the reporting of interest expenditure and income from plan assets from pension, semi-retirement and long service
bonus obligations. See the Notes to the Consolidated Financial Statements for further explanations.
** Excluding goodwill.
B S H B O S C H U N D S I E M E N S H A U S G E R ÄT E G M B H