Definitions and abbreviations
DefinitionsCash flow before financing activities:the sum of net cash flow from operating activities and net cash flow from investing activities. Comparable sales:excludes the effect of currency movements and acquisitions and divestments (changes in consolidation). Philips believes that comparable sales information enhances understanding of sales performance. Continuing net income:recurring net income from continuing operations, or net income excluding discontinued operations and excluding material non-recurring items. Dividend yield:the annual dividend payment divided by Philips’ market capitalization. All references to dividend yield are as of December 31 of the previous year (the yield on the dividend paid in 2009 uses the market capitalization as of December 31, 2008). EBITA:earnings before interest, tax and amortization (EBITA) represents income from continuing operations excluding results attributable to minority interest holders, results relating to equity-accounted investees, income taxes, financial income and expenses, amortization and impairment on intangible assets (excluding software and capitalized development expenses). Philips believes that EBITA information makes the underlying performance of its businesses more transparent by factoring out the amortization of intangible assets, which arises when acquisitions are consolidated. EBITA per common share:EBITA divided by the weighted average number of shares outstanding (basic). The same principle is used for the definition of net income or stockholders’ equity per common share, replacing EBITA. Employee Engagement Index (EEI):measures the level of employee loyalty and satisfaction; expressed as the % of employees giving a favorable score. Free cash flow:net cash flow from operating activities minus net capital expenditures. FTE:abbreviation for full-time equivalent employee. Income as a % of stockholders’ equity (ROE):measures income from continuing operations as a percentage of average stockholders’ equity. ROE rates Philips’ overall profitability by evaluating how much profit the company generates with the money shareholders have invested. Income from continuing operations:net income from continuing operations, or net income excluding discontinued operations Net promoter score (NPS):the Net Promoter Score is a tool to measure Philips’ customers’ loyalty to its products. It is measured through one question: “Based on your experience with this product, how likely are you to recommend your Philips product to a friend, relative or colleague?” Philips categorizes the answers as ‘Promoters’, ‘Passives’ or ‘Detractors’. The NPS is measured by deducting the percentage of Detractors (score 0 to 6) from the percentage of customers who are Promoters (score 9 to 10). Productivity:Philips uses Productivity internally and as mentioned in this annual report as a non-financial indicator of efficiency that relates the added value, being income from operations adjusted for certain items such as restructuring and acquisition-related charges etc. plus salaries and wages (including pension costs and other social security and similar charges), depreciation of property, plant and equipment, and amortization of intangibles, to the average number of employees over the past 12 months. Health:by ‘health’ we mean not only medical-related aspects of health, but also keeping fit, eating a healthy diet and generally living a healthy lifestyle. Well-being:by ‘well-being’ we mean a general sense of fulfillment, feeling good and at ease. ‘Well-being’ also refers to a sense of comfort, safety and security people feel in their environment – at home, at work, or out and about. AbbreviationsBFRBrominated Flame Retardants CFCChlorofluorocarbon CO2Carbon dioxide EICCElectronic Industry Citizenship Coalition EPBDEnergy Performance of Buildings EuPEnergy using Products GRIGlobal Reporting Initiative HCFCHydrochloroflurocarbon ISOInternational Standardization Organization LEDLight-Emitting Diode MDGMillennium Development Goals NGONon-Governmental Organization OLEDOrganic Light-Emitting Diode PFCPer fluorinated compounds PVCPolyvinylchloride REACHRegistration, Evaluation, Authorization and Restriction of Chemical substances RoHSRegulation on Hazardous Substances WEEEWaste Electrical and Electronic Equipment
| ||||||||
