12 Goodwill and other intangible assets

	2023
millions of CHF	Goodwill	Trademarks and licenses	Research and development	Computer software	Customer relationships	Intangible assets under construction	Total
Acquisition cost
Balance as of January 1	254.4	79.4	5.8	19.0	231.0	0.1	589.7
Acquired through business combination	24.2	3.9	–	–	20.1	–	48.2
Additions	–	–	0.0	0.2	0.1	6.1	6.5
Disposals	–	–	–0.4	–0.1	–0.7	–	–1.2
Reclassifications	–	–	0.5	1.6	–	3.4	5.5
Currency translation differences	–10.1	–0.6	–0.2	–0.3	–10.1	–0.0	–21.4
Balance as of December 31	268.5	82.6	5.8	20.3	240.4	9.6	627.3

Accumulated amortization and impairment losses
Balance as of January 1	–	69.0	4.7	15.1	126.0	–	214.8
Additions	–	2.9	0.4	2.1	17.6	–	23.0
Disposals	–	–	–0.4	–0.1	–0.7	–	–1.1
Impairments	–	–	0.4	0.1	–	–	0.6
Currency translation differences	–	–0.4	–0.2	–0.3	–5.2	–	–6.0
Balance as of December 31	–	71.5	4.9	17.0	137.8	–	231.2

Net book value
As of January 1	254.4	10.4	1.2	3.8	104.9	0.1	374.9
As of December 31	268.5	11.1	0.9	3.3	102.6	9.6	396.1

2022

millions of CHF

Goodwill

Trademarks and licenses

Research and development

Computer software

Customer relationships

Intangible assets under construction

Total

Acquisition cost

Balance as of January 1

258.0

78.5

6.0

17.8

231.8

–

592.2

Acquired through business combination

5.2

1.3

–

6.9

–

13.4

Deconsolidation of medmix Poland

–

–0.0

–

–0.1

–

–0.2

Additions

–

0.0

2.0

–

0.1

2.2

Disposals

–

–0.1

–

–0.1

Currency translation differences

–8.8

–0.4

–0.2

–0.7

–7.7

–0.0

–17.8

Balance as of December 31

254.4

79.4

5.8

19.0

231.0

0.1

589.7

Accumulated amortization and impairment losses

Balance as of January 1

–

66.6

4.5

14.1

113.0

–

198.3

Deconsolidation of medmix Poland

–

–0.0

–

–0.1

–

–0.1

Additions

–

2.6

0.4

1.3

16.5

–

20.8

Disposals

–

–0.1

–

–0.1

Currency translation differences

–

–0.3

–0.2

–0.1

–3.5

–

–4.1

Balance as of December 31

–

69.0

4.7

15.1

126.0

–

214.8

Net book value

As of January 1

258.0

11.9

1.5

3.7

118.8

–

393.9

As of December 31

254.4

10.4

1.2

3.8

104.9

0.1

374.9

Goodwill impairment test

	2023
millions of CHF	Goodwill	Headroom	Growth rate residual value	Pretax discount rate
Healthcare	105.5	1’428.2	2.0%	9.6%
Consumer & Industrial	163.0	282.9	2.0%	11.5%
Total as of December 31	268.5	1’711.1

	2022
millions of CHF	Goodwill	Headroom	Growth rate residual value	Pretax discount rate
Healthcare	69.9	1’604.3	2.0%	7.9%
Consumer & Industrial	184.5	375.8	2.0%	9.5%
Total as of December 31	254.4	1’980.1

Goodwill is allocated to the smallest cash-generating unit at which goodwill is monitored for internal management purposes (i.e., business area). The recoverable amount of these units is determined over a five-year cash flow projection period.

The calculation is based on the budget for the first period (2023), the three-year strategic plan for the subsequent two periods (2024–2025) and a management calculation for the next two periods (2026–2027). The budget and the three-year strategic plan were approved by the Board of Directors in February 2023. Cash flows beyond the planning period are extrapolated using a terminal value including the growth rates as stated above.

As of December 31, 2023, there is no indication of goodwill impairment. Updating the impairment test would not have resulted in a goodwill impairment.

Sensitivity analyses

The recoverable amount from cash-generating units is measured based on value-in-use calculations significantly impacted by the terminal growth rate used to determine the residual value, the discount rate and the projected cash flows. The table above shows the amount by which the estimated recoverable amount of the CGU exceeds its carrying amount (headroom).

Management determined there are no reasonably possible changes in key assumptions that would result in a goodwill impairment.