Vetoquinol Universal Registration Document 2019

Vetoquinol  Universal Registration Document 2019  Financial report   71 CONSOLIDATED FINANCIAL STATEMENTS Notes to the consolidated financial statements 6 6.5.7.3 Reconciliation of purchase price with cash outflow as per the cash flow statement €000 TOTAL Additional payment relating to acquisition of VetCom products - Acquisition of majority stake in Farmvet 3,734 Farmvet liquid assets as of acquisition date 8 AMOUNT SHOWN IN 2018 CASH FLOW STATEMENT 3,726 Acquisition of majority stake in Clarion 51,978 Clarion liquid assets as of acquisition date 15 Currency difference between acquisition date exchange rate and average rate related to the Clarion acquisition (1,513) Additional payment relating to acquisition of VetComproducts 350 AMOUNT SHOWN IN 2019 CASH FLOW STATEMENT 50,801 6.5.8 Operating segments – IFRS 8 2019 and 2018 revenues were essentially derived from sales of veterinary products and services. The Group receives no income from patent, know-how, manufactu- ring or trademark licenses. Pursuant to IFRS 15, income from ordinary activities cor- responds to the value of the financial consideration the Group expects to receive in return for providing goods or services to its customers. The Group follows these steps for revenue recognition: • identifying the contract, • identifying the different performance obligations of the contract, • determining the transaction price, • allocating the transaction price, • recognizing revenues when (or as) the entity satisfies a performance obligation. 6.5.8.1 Segment reporting – IFRS 8 Pursuant to IFRS 8, segment information is reported on the basis of internal management data communicated to the Group’s Executive Committee, the Group’s chief operational decision-maker. The Group’s operating seg- ments are geographical segments monitored individually through internal reporting. A geographical segment is a group of assets and opera- tions engaged in providing products or services within a particular economic environment and which is exposed to risks and returns that are different from the risks and returns of other economic environments in which the Group operates. The Group’s worldwide organizational structure is divided into three regions (territories) defined by the location of the Group’s assets and operations: • Europe; • the Americas; • Asia Pacific, distributors, and rest of world. Although the Group also has two marketing segments, the companion animal (pet) and livestock segments, they cannot be deemed to form a separate reportable opera- ting segment, for the following reasons: • product type: most therapeutic segments are common to pets and livestock (i.e. antibiotics, parasiticides, etc.); • production processes: production lines are common to both segments and there is no significant difference in terms of sources of supply; • type or category of customers: a distinction is made between the veterinarian sector and the OTC mass market; • distribution: the main distribution channels depend more on the legislation of the country than on the mar- keting segment. Sales forces can, in some cases, be common to both marketing segments; • nature of regulatory environment: the regulatory bodies responsible for marketing authorization are the same for both segments. For this reason, the Group will only report on its geogra- phical segments.