Non-current assets

The net value represents the residual book value, which equals the acquisition or production cost less accumulated depreciation or amortisation.

Currency translation differences arise from the translation of foreign companies’ assets using different exchange rates at the beginning and end of the 2013/14 financial year.

35. Intangible assets

Rights include electricity procurement rights, transportation rights for natural gas pipelines and other rights (primarily software licenses). Other intangible assets primarily included the customer bases of the Bulgarian and Macedonian electricity supply companies.

The impairment testing of intangible assets in accordance with IAS 36 led to the recognition of impairment losses totalling EUR 191.8m in the Energy Supply South East Europe segment during the reporting year. These impairment losses were based on tariff changes in Bulgaria and Macedonia as of 1 July 2014, which were announced in an ad-hoc press release on 2 July 2014. The tariff changes led to the revaluation of business activities in these two countries and the full write-off of goodwill and customer bases.

In Bulgaria, the new tariffs call for a substantial increase in the electricity procurement price but only a slight increase in end customer prices. A further reduction was also made in the margin for the sales company EVN Bulgaria EC. The recoverable amount for the CGU “electricity distribution Bulgaria” was determined on the basis of the value in use and equalled EUR 394.7m as of 30 June 2014. The pretax WACC equalled 9.37% (previous year 8.68%). The recognised impairment losses were confirmed as of 30 September 2014 and totaled EUR 141.0m, whereby EUR 122.6m were attributable to goodwill.

In Macedonia, the increase in end customer prices was lower than expected and cost elements related to the planned liberalisation were not taken into account. These developments led to the recognition of an impairment loss on both goodwill and the customer base. The recoverable amount for the CGU “electricity distribution Macedonia” was determined on the basis of the value in use and equalled EUR 249.0m as of 30 June 2014. The pre-tax WACC equalled 11.61% (previous year 11.61%). The recognised impairment losses were confirmed as of 30 September 2014 and totalled EUR 50.8m, whereby EUR 26.3m were attributable to goodwill.

No impairment losses were recognised on intangible assets during the financial year 2012/13.

In 2013/14, a total of EUR 1.2m (previous year: EUR 1.6m) was invested in research and development. The criteria required by IFRS to capitalise these items were not fulfilled.