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Development of other major items in the statement of income

Group gross profit rose to €5,639 million, exceeding the previous year’s gross profit of €5,326 million by 6% (8% in constant currency). We improved the gross margin to 34.1% (2010: 33.3%). The cost of sales rose by 2% to €10,883 million (2010: €10,646 million). Cost of sales as a percentage of Group sales decreased from 66.7% in 2010 to 65.9%. Selling, general, and administrative expenses consisted primarily of personnel costs, marketing and distribution costs, and depreciation and amortization. These expenses rose by 5% to €2,809 million (2010: €2,664 million). Their ratio as a percentage of Group sales was 17,0% (2010: 16.7%). Depreciation and amortization was €674 million (2010: €639 million). Their ratio as a percentage of sales was 4.1% (2010: 4.0%). Personnel costs increased to €5,555 million (2010: €5,354 million). The personnel cost ratio amounted to 33.6% (2010: 33.5%).

The chart below shows the earnings structure in 2011.

Group net interest was -€531 million (2010: -€566 million). Lower average interest rates for liabilities had a positive effect as well as currency translation due to the weakness of the U.S. dollar against the euro.

The other financial result of -€100 million includes the valuation changes of the fair redemption value of the Mandatory Exchangeable Bonds (MEB) of -€105 million and the Contingent Value Rights (CVR) of €5 million. Both are noncash items.

The adjusted Group tax rate (adjusted for the effects of the mark-to-market accounting of MEB and CVR) decreased to 30.7% (2010: 32.9%).

Noncontrolling interest rose to €638 million from €583 million in 2010 mainly due to the good earnings performance at Fresenius Medical Care. Of this, 92% was attributable to the noncontrolling interest in Fresenius Medical Care.

The table below shows the profit margin progress.

in % 2011 2010 2009 20082 2007
1 Return on sales adjusted for the effects of mark-to-market accounting of the Mandatory Exchangeable Bonds (MEB) and Contingent Value Rights (CVR).
2 2008 is adjusted for special items relating to the APP acquisition
EBITDA margin 19.6 19.1 18.5 17.9 17.9
EBIT margin 15.5 15.1 14.5 14.0 14.2
Return on sales (before taxes and noncontrolling interest) 12.31 11.61 10.41 10.5 10.9

in % 2011 2010 2009 20082 2007
1 Return on sales adjusted for the effects of mark-to-market accounting of the Mandatory Exchangeable Bonds (MEB) and Contingent Value Rights (CVR).
2 2008 is adjusted for special items relating to the APP acquisition
EBITDA margin 19.6 19.1 18.5 17.9 17.9
EBIT margin 15.5 15.1 14.5 14.0 14.2
Return on sales (before taxes and noncontrolling interest) 12.31 11.61 10.41 10.5 10.9

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