Selected notes to the consolidated income statement Net revenue Net revenue breaks down into the following revenue categories: (XLS:) Download millions of € H1 2019 H1 2018b a Revenue from the sale of goods and merchandise includes interest income of EUR 0.2 billion in the reporting period, calculated using the effective interest method (H1 2018: EUR 0.1 billion). This income is primarily attributable to accrued interest on receivables in connection with handsets sold under installment plans in the United States operating segment. b Prior-year figures were adjusted on account of a change in the allocation between revenue categories. This change relates to revenue from the use of entity assets by others of EUR 143 million in the Group Development operating segment that had been reported under revenue from the rendering of services in the consolidated financial statements for January 1 to June 30, 2018. Revenue from the rendering of services 32,070 29,945 Germany 8,675 8,751 United States 15,220 13,299 Europe 4,899 4,802 Systems Solutions 2,515 2,588 Group Development 730 476 Group Headquarters & Group Services 31 29 Revenue from the sale of goods and merchandisea 6,078 5,571 Germany 1,018 987 United States 4,127 3,684 Europe 692 712 Systems Solutions 64 48 Group Development 177 141 Group Headquarters & Group Services 0 0 Revenue from the use of entity assets by others 1,004 776 Germany 402 238 United States 276 294 Europe 109 25 Systems Solutions 20 15 Group Development 134 143 Group Headquarters & Group Services 64 61 NET REVENUE 39,152 36,291 For details of changes in net revenue, please refer to the section “Development of business in the Group” in the interim Group management report. Other operating income (XLS:) Download millions of € H1 2019 H1 2018 Income from the reversal of impairment losses on non-current assets 0 2 Of which: IFRS 5 0 0 Income from the disposal of non-current assets 34 165 Income from reimbursements 74 81 Income from insurance compensation 56 169 Income from ancillary services 11 14 Income from the reversal of impairment losses on non-current assets 0 0 Miscellaneous other operating income 282 281 Of which: income from divestitures and from the sale of stakes accounted for using the equity method 1 0 457 711 In the prior-year period, income from the disposal of non-current assets primarily comprised income from the disposal of real estate previously recognized as non-current assets and disposal groups held for sale. Income from insurance compensation in the prior-year period mainly comprised compensation payments received by T-Mobile US in the first half of 2018 for damage caused by hurricanes in 2017. Miscellaneous other operating income includes a large number of individual items accounting for marginal amounts. Other operating expenses (XLS:) Download millions of € H1 2019 H1 2018 Impairment losses on financial assets (141) (216) Gains (losses) from the write-off of financial assets measured at amortized cost (47) (20) Other (1,307) (1,182) Legal and audit fees (138) (146) Losses from asset disposals (74) (74) Income (losses) from the measurement of factoring receivables (77) (62) Other taxes (257) (259) Cash and guarantee transaction costs (172) (166) Insurance expenses (48) (44) Miscellaneous other operating expenses (541) (431) (1,495) (1,418) Miscellaneous other operating expenses include a large number of individual items accounting for marginal amounts. Depreciation, amortization and impairment losses At EUR 8.6 billion, depreciation, amortization and impairment losses on intangible assets, property, plant and equipment, and right-of-use assets were EUR 2.3 billion higher than in the prior-year period. Of this figure, EUR 1.7 billion was attributable to the depreciation charge for right-of-use assets required to be recognized for the first time in accordance with IFRS 16. In the prior-year period, by contrast, expenses had been recognized under goods and services purchased in connection with operating leases as well as depreciation of finance lease assets recognized as property, plant and equipment. Depreciation of property, plant and equipment and amortization of intangible assets were EUR 0.5 billion higher than in the prior year, mainly due to the consistently high investment volume in past years. Profit/loss from financial activities The loss from financial activities decreased by EUR 0.7 billion compared with the first half of 2018 to EUR 0.9 billion, with the share of profit/loss of associates and joint ventures accounted for using the equity method increasing substantially by EUR 0.6 billion to EUR 0.1 billion. This was mainly attributable to the settlement agreement reached in the prior year to end the Toll Collect arbitration proceedings, which had a negative effect of EUR 0.6 billion. Other financial income/expense improved by EUR 0.3 billion, mainly due to positive measurement effects from embedded derivatives at T‑Mobile US. For more information, please refer to “Disclosures on financial instruments.” By contrast, finance costs increased by EUR 0.2 billion to EUR 1.2 billion. The subsequent measurement of recognized lease liabilities since the application of IFRS 16 increased finance costs by EUR 0.4 billion. Income taxes A tax expense of EUR 1.0 billion was recorded in the first half of 2019. The effective tax rate of 28 percent essentially reflects the shares of the different countries in the profit before income taxes and their respective national tax rates. In the prior-year period, the tax expense totaled EUR 0.9 billion and was primarily attributable to lower profit before income taxes.
