429 BMW Group Report 2024 To Our Stakeholders Combined Management Report Group Financial Statements Responsibility Statement and Auditor’s Report Remuneration Report Other Information Glossary P Payout ratio Ratio of unappropriated profit of BMW AG in accordance with HGB to profit attributable to shareholders of BMW AG, based on the BMW Group’s net profit for the year under IFRS. Until the 2021 financial year, the payout ratio corresponded to the ratio of unappropriated profit belonging to BMW AG in accordance with HGB to the net profit for the year of the BMW Group in accord- ance with IFRS. Post-tax return on sales Group net profit as a percentage of Group revenues. Pre-tax return on sales Group profit / loss before tax as a percentage of Group revenues. R Research and development expenditure The sum of research and non-capitalised development costs and investments in capitalised development costs not including the associated scheduled amortisation. Research and development expenditure ratio Research and development expenditure as a percentage of Group revenues. Research and development locations The engineering, IT and process expertise required for the (pre-) development of hardware and software for all BMW Group prod- ucts and services is combined at the Group’s international re- search and development locations. Return on capital employed (RoCE) RoCE in the Automotive and Motorcycles segments is measured on the basis of relevant segment profit before financial result and the average amount of capital employed – at the end of the last five quarters – in the segment concerned. Capital employed cor- responds to the sum of intangible assets, property, plant and equipment and net working capital, the latter comprising inven- tories and trade receivables less trade payables. Up to the financial year 2021, capital employed corresponds to the sum of all current and non-current operational assets, less liabilities that generally do not incur interest. The deductible cap- ital consisted of capital shares that are available to the opera- tional business, largely without interest. Return on equity (RoE) RoE in the Financial Services segment is calculated as segment profit before taxes, divided by the average amount of equity cap- ital – at the end of the last five quarters – attributable to the Fi- nancial Services segment. V Value at risk A measure of the potential maximum loss in value of an item dur- ing a set time period, based on a specified probability.