Getinge 2022 Annual Report
Getinge 2022 Annual Report
Introduction
Strategy
Corporate Governance
Annual Report
Sustainability Report
Other information
Contents
Note 12 cont.
Impairment testing
Goodwill
2022
Acute Care Therapies
17,991
2021
15,740
Surgical Workflows
3,609
3,106
Life Science
Total
912
22,512
834
19,681
Goodwill is distributed among the Group's cash generating units
(CGUS), which are identified per business area.
Goodwill and other net assets are tested for impairment annually
and whenever conditions indicate that impairment may be
necessary. The recoverable amount for CGUS is determined based
on the calculated value in use. For impairment testing purposes,
this has been done at the lowest level where separable cash flows
have been identified, which for Getinge is the same as its business
areas.
Assumptions
The value in use of goodwill and other net assets attributable to
Acute Care Therapies, Surgical Workflows and Life Science was
calculated based on discounted cash flows, which are based on
assumptions regarding sales growth and the cost trend. Cash flows
for the first three years are based on a financial plan approved
by the Board. Cash flows after this three-year period have been
determined using a growth rate corresponding to 2%. This growth
is based on reasonable prudence and does not exceed long-term
growth for the industry as a whole. A discount rate before tax for
Acute Care Therapies of 9.2% (8.8) and for Surgical Workflows and
Life Science of 10.0% (8.8), was applied when calculating the value
in use of all business areas. Right-of-use assets are included in the
net assets tested for impairment for each business area and future
cash flows referring to lease contracts are taken into account when
determining the value in use. With the assumptions described
above, value in use exceeds the carrying amount for all CGUS.
Sensitivity analysis
In connection with the impairment test, sensitivity analyses have
been performed regarding changes in growth rate and discount
rate, which have a significant impact on the calculation of the
discounted cash flows. The sensitivity analyses showed that the
negative changes below would not individually generate a need
for impairment in any business area:
•
•
Growth rate after year three decreases to 1%
Discount rate before tax increases 1 percentage
point to 10.2% and 11.0%
Intangible assets
Except goodwill, there are within intangible assets also trademarks
amounting to SEK 159 M (143) whose useful life has been assessed
as indefinite. For these trademarks, no forseeable time limit have
been applied for Getinge's expected future cash flows. The useful
life for other intangible assets is three to 15 years. For strategic
acquisitions, the useful life exceeds five years.
92
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