Note 11: Property, plant and equipment

Property, plant and equipment

In € millions

Buildings and land

Plant equipment and machinery

Other equipment

Construc­tion in progress and prepay­ments on projects

Assets not used

Total

 

 

 

 

 

 

 

Balance at January 1, 2017

 

 

 

 

 

 

Cost of acquisition

2,529

6,987

1,052

976

57

11,601

Accumulated depreciation/impairment

(1,344)

(5,109)

(819)

(88)

(51)

(7,411)

Carrying value

1,185

1,878

233

888

6

4,190

 

 

 

 

 

 

 

Movements in 2017

 

 

 

 

 

 

Acquisitions

9

2

11

Divestments

(11)

(4)

(2)

(3)

(20)

Capital expenditures

39

215

51

307

1

613

Transfer between categories

147

446

76

(669)

Depreciation

(75)

(335)

(75)

(1)

(486)

Impairments, including reversals

3

(1)

2

(4)

Classified as held for sale

(434)

(1,472)

(64)

(295)

(1)

(2,266)

Other

2

1

1

4

Changes in exchange rates

(66)

(102)

(10)

(36)

(214)

Total movements

(386)

(1,250)

(21)

(697)

(4)

(2,358)

 

 

 

 

 

 

 

Balance at December 31, 2017

 

 

 

 

 

 

Cost of acquisition

1,488

1,901

925

193

7

4,514

Accumulated depreciation/impairment

(689)

(1,273)

(713)

(2)

(5)

(2,682)

Carrying value at December 31, 2017

799

628

212

191

2

1,832

Impact adoption IFRS 15

(56)

(10)

(66)

Impact application IAS 29

11

2

1

14

Balance at January 1, 2018

810

630

156

182

2

1,780

 

 

 

 

 

 

 

Movements in 2018

 

 

 

 

 

 

Acquisitions

18

4

2

1

2

27

Divestments

(7)

(1)

(2)

(1)

(11)

Capital expenditures

6

31

13

111

(1)

160

Transfer between categories

22

48

46

(116)

Depreciation

(44)

(93)

(44)

(181)

Impairments, including reversals

(1)

(1)

Changes in exchange rates

(10)

(8)

(5)

(3)

(26)

Total movements

(16)

(19)

10

(8)

1

(32)

 

 

 

 

 

 

 

Balance at December 31, 2018

 

 

 

 

 

 

Cost of acquisition

1,505

1,894

888

178

10

4,475

Accumulated depreciation/impairment

(711)

(1,283)

(722)

(4)

(7)

(2,727)

Carrying value at December 31, 2018

794

611

166

174

3

1,748

Capital expenditures

In 2018, we have slightly underspent our CAPEX initial plan due to increased CAPEX governance and rigor, whilst we also re-evaluated all CAPEX submissions to ensure full alignment with our 15% by 2020 strategy.

During the year we have primarily invested in incremental capacity to support growth (an example is the Powder Coatings site in India) as well as in further the optimization of our asset footprint (for both production consolidation and insourcing from past acquisitions such as BASF Industrial Coatings). We also continued our investment strategy to support our resource productivity ambition with abatement systems, on-site solvent recovery systems and minimization systems as examples.

Impairments

In 2018, no significant impairments were recognized. In 2017, several small impairments and reversals of impairments were recognized, spread over all businesses.

Financial lease

The carrying value of the property, plant and equipment financed by hire purchase and leasing and not legally owned by the company was €30 million (2017: €33 million) of which €29 million is relating to buildings.

In 2018, we did not enter into new financial leases.

ROS (return on sales)

This is a key profitability measure and is calculated as adjusted operating income as a percentage of revenue.

VOC

Volatile organic compounds.

Emissions and waste

We report emissions to air, land and water for those substances which may have an impact on people or the environment: CO2, NOx and SOx, VOCs, chemical oxygen demand, COD, hazardous and non-hazardous waste.