5 – Other operating income and expenses
Other operating income (million €) |
|||||
|---|---|---|---|---|---|
|
|
2nd Quarter |
1st Half |
||
|
|
2015 |
2014 |
2015 |
2014 |
Income on the reversal of provisions |
|
27 |
7 |
29 |
28 |
Revenue from miscellaneous revenue-generating activities |
|
44 |
47 |
85 |
81 |
Income from foreign currency and hedging transactions |
|
(27) |
(9) |
113 |
125 |
Income from the translation of financial statements in foreign currencies |
|
(19) |
18 |
85 |
24 |
Gains on the disposal of fixed assets and divestitures |
|
82 |
44 |
142 |
181 |
Income on the reversal of valuation allowances for business-related receivables |
|
10 |
13 |
21 |
21 |
Miscellaneous income |
|
195 |
156 |
282 |
216 |
Other operating income |
|
312 |
276 |
757 |
676 |
Other operating expenses (million €) |
|||||
|---|---|---|---|---|---|
|
|
2nd Quarter |
1st Half |
||
|
|
2015 |
2014 |
2015 |
2014 |
Expenses from the LTI program as well as other personnel obligations |
|
(163) |
74 |
123 |
142 |
Restructuring measures |
|
34 |
12 |
53 |
22 |
Environmental protection and safety measures, costs of demolition and removal, and project expenses related to capital expenditures that are not subject to mandatory capitalization |
|
91 |
85 |
187 |
145 |
Amortization, depreciation and impairments of intangible assets and property, plant and equipment |
|
57 |
55 |
76 |
57 |
Costs from miscellaneous revenue-generating activities |
|
44 |
39 |
85 |
67 |
Expenses from foreign currency and hedging transactions |
|
32 |
92 |
262 |
236 |
Losses from the translation of financial statements in foreign currencies |
|
20 |
28 |
90 |
75 |
Losses from the disposal of fixed assets and divestitures |
|
12 |
4 |
17 |
9 |
Oil and gas exploration expenses |
|
31 |
23 |
80 |
47 |
Expenses from the addition of valuation allow-ances for business-related receivables |
|
27 |
19 |
46 |
34 |
Expenses from the use of inventories measured at market value and the derecognition of obsolete inventory |
|
66 |
36 |
110 |
70 |
Miscellaneous expenses |
|
175 |
126 |
415 |
262 |
Other operating expenses |
|
426 |
593 |
1,544 |
1,166 |
The balance from hedging transactions rose by €17 million quarter-on-quarter, from minus €48 million to minus €31 million; the first half of 2015 saw a year-on-year decline of €8 million, from minus €26 million to minus €34 million. This development was largely the result of oil swaps used by WINGAS GmbH, based in Kassel, Germany, to swap variable prices for fixed prices in order to hedge trading margins.
The balance from foreign currency transactions improved by €25 million compared with the previous second quarter, from minus €53 million to minus €28 million, yet it fell by €30 million in the first half, from minus €85 million in the first half of 2014 to minus €115 million in 2015. This was predominantly attributable to the fair value development of hedging transactions for the Russian ruble and the U.S. dollar.
The balance from the translation of financial statements in foreign currencies decreased by €29 million quarter-on-quarter, from minus €10 million to minus €39 million. At the same time, the balance from the translation of financial statements in foreign currencies rose by €46 million year-on-year, from minus €51 million in the first half of 2014 to minus €5 million in the first half of 2015. This was largely due to translation effects for subsidiaries outside of the eurozone that use the euro as their functional currency.
In the second quarter of 2015, gains on the disposal of fixed assets and divestitures mostly pertained to the divestiture of the global textile chemicals business to Archroma. Gains from the disposal of fixed assets and divestitures declined in the first half of 2015 compared with the same period of 2014, in which shares in non-BASF-operated oil and gas fields in the British North Sea had been sold to the Hungarian MOL Group.
Miscellaneous income rose in comparison with the corresponding period of the previous year due to insurance compensation received for a plant outage at the Ellba C.V. joint operation in Moerdijk, Netherlands. In addition, higher income arose from a price compensation for gas producers from the Argentinian government, which was introduced in connection with the New Gas Price Scheme (NGPS) due to the lower, partly locally regulated gas prices.
Expenses from the valuation of long-term incentive (LTI) options declined owing to the adjustment of provisions for the LTI program: Whereas the previous second quarter had contained expenses for the addition of provisions, the second quarter of 2015 included income from the reversal of provisions as a result of the lower share price.
The increase in miscellaneous expenses in the second quarter of 2015 was mainly attributable to expenses related to a plant outage at the Ellba C.V. joint operation in Moerdijk, Netherlands. In addition, the first half of 2015 included expenses of around €100 million for the anniversary bonus paid out to employees on the occasion of BASF’s 150th anniversary.