Note 6: Operating income
In 2020, operating income was up 15% at €963 million (2019: €841 million). Margin management and cost savings more than offset lower volumes. Operating income as a percentage of revenue (OPI margin) improved to 11.3% (2019: 9.1%). Operating income included €136 million (2019: €150 million) negative impact from identified items, mainly related to €121 million transformation costs to create a focused high-performing Paints and Coatings business.
In 2019, operating income was up 39% at €841 million (2018: €605 million). Price/mix effects, cost savings and lower identified items more than offset raw material inflation and lower volumes. Operating income as a percentage of revenue (OPI margin) improved to 9.1% (2018: 6.5%). Operating income included €150 million (2018: €193 million) negative impact from identified items, related to €204 million transformation costs to create a focused high-performing Paints and Coatings business (including €66 million non-cash impairments), partly offset by a gain on disposal of €54 million following asset network optimization.
In € millions |
Employee benefits |
Amortization |
Depreciation |
Purchases and other costs |
Total |
|---|---|---|---|---|---|
Cost of sales |
(524) |
— |
(160) |
(4,061) |
(4,745) |
Selling expenses |
(832) |
(48) |
(83) |
(953) |
(1,916) |
General and administrative expenses |
(319) |
(12) |
(40) |
(292) |
(663) |
Research and development expenses |
(175) |
(4) |
(14) |
(45) |
(238) |
Other results |
— |
— |
— |
(5) |
(5) |
Total |
(1,850) |
(64) |
(297) |
(5,356) |
(7,567) |
In € millions |
Employee benefits |
Amortization |
Depreciation |
Purchases and other costs |
Total |
||
|---|---|---|---|---|---|---|---|
Cost of sales |
(537) |
— |
(149) |
(4,628) |
(5,314) |
||
Selling expenses |
(861) |
(54) |
(97) |
(1,205) |
(2,217) |
||
General and administrative expenses |
(300) |
(10) |
(33) |
(294) |
(637) |
||
Research and development expenses |
(177) |
(3) |
(14) |
(68) |
(262) |
||
Other results |
— |
— |
— |
(5) |
(5) |
||
Total |
(1,875) |
(67) |
(293) |
(6,200) |
(8,435) |
||
|
|||||||
Operating income is defined in accordance with IFRS and includes the relevant identified items. Adjusted operating income excludes identified items.
Operating income as a percentage of revenue.
Identified items are special charges and benefits, results on acquisitions and divestments, major restructuring and impairment charges and charges related to major legal, environmental and tax cases.
Operating income is defined in accordance with IFRS and includes the relevant identified items. Adjusted operating income excludes identified items.