19 Goodwill

The carrying amount of goodwill came to € 1,391.7 million as of June 30, 2025 (December 31, 2024: € 1,391.7 million). There was no change in goodwill, all of which relates to the Value-add segment, as against December 31, 2024. An ad hoc impairment test was conducted as of March 31, 2025, due to the latest market developments (the market capitalization value was lower than the value of shareholders’ reported equity). No triggering event within the meaning of IAS 36 was applicable as of June 30, 2025, and therefore nor was there a need for an impairment test. What is more, the market capitalization value was higher than the value of shareholders’ reported equity again. As a result, the statements and figures below relate exclusively to the impairment test as of March 31, 2025.

For the purposes of the ad hoc impairment test on goodwill as of March 31, 2025, the five-year plan for the Value-add segment for the fiscal years from 2025 to 2029 was taken as a basis. This also forms part of the five-year plan for the Group as a whole as approved by the Management Board and acknowledged by the Supervisory Board. The plan is based on assessments regarding the development of the operating business areas in terms of future revenue, expenses and margins, and taking current market developments into account.

The value of the goodwill for the Value-add group of CGUs was ultimately confirmed by the impairment test. The impairment test is performed by comparing the carrying amount of the Value-add CGU against its value in use. Developments in the Value-add segment are characterized primarily by the extension of existing business areas (craftsmen’s organization, multimedia, management of residential property, smart metering, energy service, etc.).  On the other hand, there is an increase in operating expenses, taking into account the rate of inflation. The development in these values is in line with past experiences of business model development.

The cash flows based on the average for the extended planning period, i.e., planning years six to ten, were derived to calculate the perpetual annuity.

A constant growth rate of 1.5% (December 31, 2024: 1.5%) was assumed for the Value-add group of CGUs.

The weighted average cost of capital before tax is based on the risk-free interest rate calculated as a three-month average using the Svensson method, a market risk premium and a levered beta. The levered beta and the equity ratios used are determined on the basis of a peer comparison. The main parameters are shown in the following table:

An increase in the cost of capital would result in the following need for impairment:

In the event of a drop in the planned sustainable rate of increase by 0.5 percentage points, there would be no impairment losses in the Value-add segment.

In the previous year, a drop of 0.5 percentage points in the planned sustainable growth rate would not have resulted in any impairment losses in the Value-add segment.