6. Revenue
Revenue derives from the sale of goods such as carton sleeves, closures, bag-in-box and spouted pouches with associated materials (barrier film and fitments), filling lines and other related equipment as well as the provision of after-market services. Revenue is presented net of returns, trade discounts, volume rebates and other customer incentives. In addition, the Group presents income from the deployment of filling lines and other related equipment under contracts that qualify to be accounted for as operating leases as part of revenue.
Composition of revenue
(In € million) |
|
Year ended |
|
Year ended |
|---|---|---|---|---|
Revenue from sale and service contracts |
|
3,160.3 |
|
3,067.4 |
Revenue from filling line and other related equipment contracts accounted for as operating leases |
|
168.2 |
|
162.9 |
Total revenue |
|
3,328.5 |
|
3,230.3 |
The Group’s total revenue is disaggregated by major product/service line in the table below.
(In € million) |
|
Year ended |
|
Year ended |
|---|---|---|---|---|
Revenue from the sale of carton, bag-in-box and spouted pouch |
|
2,889.6 |
|
2,825.3 |
Filling line and other related equipment revenue |
|
226.7 |
|
225.5 |
Service revenue |
|
212.0 |
|
179.0 |
Other revenue |
|
0.2 |
|
0.5 |
Total revenue |
|
3,328.5 |
|
3,230.3 |
Revenue from the sale of carton, bag-in-box and spouted pouch is mainly composed of revenue from the sale of aseptic carton sleeves and closures.
Filling line and other related equipment revenue is composed of revenue from the deployment of equipment under contracts that qualify to be accounted for as operating leases as well as revenue from the sale of equipment.
Service revenue relates to after-market services in relation to the Group’s equipment.
The Group’s revenue is disaggregated by type of business in the table below.
(In € million) |
|
Year ended |
|
Year ended |
|---|---|---|---|---|
Revenue from the carton business |
|
2,748.9 |
|
2,626.3 |
Revenue from the bag-in-box and spouted pouch businesses |
|
579.6 |
|
604.0 |
Total revenue |
|
3,328.5 |
|
3,230.3 |
Revenue from the carton business mainly relates to the provision of aseptic carton packaging solutions but also to the provision of chilled carton packaging solutions in Asia.
Notes 18 and 20 include information about the Group’s liabilities relating to various incentive programs, advance payments from customers and deferred revenue, which had or will have an impact on the amount of revenue recognized.
Accounting policy, significant judgments and estimates
Revenue from sale of carton, bag-in-box and spouted pouches with associated products, deployment of filling lines and other related equipment under contracts accounted for as sale contracts and provision of service is measured at the fair value of the consideration received or receivable net of returns, trade discounts, volume rebates and other customer sales incentives.
Revenue is recognized when the Group transfers control over a product or service to a customer. Transfer of control varies depending on the individual contract terms. Revenue from the sale of carton, bag-in-box and spouted pouches with associated products as well as the deployment of filling lines and other related equipment under contracts accounted for as sale contracts is recognized at a point in time, while revenue from service contracts is recognized over time.
Lease payments for filling lines and other related equipment that are deployed under operating lease contracts are recognized on a straight-line basis over the lease term. The payment (i.e. the sale price) for the use of aseptic carton filling lines that are deployed under sale contracts that qualify to be accounted for as operating leases is recognized as a deferred revenue liability in the statement of financial position, and recognized as revenue on a straight-line basis over the shorter of the period over which the customer relationship is expected to last and the ten-year estimated useful life of a filling line. The control and significant risks and rewards of ownership are retained by the Group in respect of such sale contracts (see also note 5.5.2).
When sales incentives are offered to customers, only the amount of revenue that is highly probable not to be reversed is recognized. The amount of sales incentives expected to be earned or taken by customers in conjunction with incentive programs is therefore estimated and deducted from revenue. Estimates in respect of the incentives are based on historical and current sales trends, which are affected by the business seasonality and competitiveness of promotional programs being offered. Estimates are reviewed quarterly for possible revisions.