Note 13: Cash, cash flow and net debt

In € millions

 

2013

 

2014

Cash on hand and in banks

 

1,333

 

848

Short-term investments

 

765

 

884

Included under cash and cash equivalents in the balance sheet

 

2,098

 

1,732

Debt to credit institutions

 

(78)

 

(83)

Total per cash flow statement

 

2,020

 

1,649

Short-term investments almost entirely consist of cash loans, time deposits, marketable private borrowings and marketable securities immediately convertible into cash. For more information on credit risk management, see Note 23.

At December 31, 2014, an amount of €95 million in cash and cash equivalents was restricted (2013: €115 million). Restricted cash is defined as cash that cannot be accessed centrally due to regulatory or contractual restrictions.

Cash flow impact on working capital

 

 

 

 

 

In € millions

 

2013

 

2014

Trade and other receivables

 

(181)

 

(113)

Inventories

 

(7)

 

(59)

Trade and other payables

 

175

 

200

Total

 

(13)

 

28

Cash flow impact of changes in provisions

 

 

 

 

 

In € millions

 

2013

 

2014

Post-retirement provisions

 

(417)

 

(348)

Restructuring provisions

 

55

 

16

Environmental and sundry provisions

 

(33)

 

(74)

Total

 

(395)

 

(406)

Changes in provisions is the balance of amounts paid and additions/reversals during the year. In 2014, €92 million of the change in sundry provisions concerned discontinued operations.

Cash flow and net debt

Operating activities in 2014 resulted in cash inflows of €811 million (2013: €716 million). Profit from continuing operations was lower in 2014, however, the comparative for 2014 included a non-cash gain from deferred tax of €124 million, which is reversed on the line Income tax. Net cash from operating activities benefited from lower working capital.

Net debt at year-end 2014 of €1,606 million was slightly up on 2013 (€1,529 million). Cash outflows used for discontinued operations of €88 million mainly related to a settlement for a case following the divestment of Organon BioSciences in 2007.

Net debt

 

 

 

 

 

 

 

 

 

In € millions

 

Long-term

 

Short-term

 

Cash

 

Net debt

Net debt equivalents at January 1, 2013

 

3,388

 

662

 

(1,752)

 

2,298

New debt issued

 

167

 

82

 

(249)

 

Redemption of loans

 

 

(594)

 

594

 

Net cash from operating activities

 

 

 

(716)

 

(716)

Capital expenditures

 

 

 

666

 

666

Acquisitions and divestments

 

 

 

(1,092)

 

(1,092)

Dividends

 

 

 

286

 

286

Transfers from long-term to short-term

 

(867)

 

867

 

 

Effect of exchange rate changes on cash and cash equivalents

 

(9)

 

(37)

 

91

 

45

Other changes

 

(13)

 

(19)

 

74

 

42

Net debt equivalents at year-end

 

2,666

 

961

 

(2,098)

 

1,529

Net debt

 

 

 

 

 

 

 

 

 

In € millions

 

Long-term

 

Short-term

 

Cash

 

Net debt

Net debt equivalents at January 1, 2014

 

2,666

 

961

 

(2,098)

 

1,529

New debt issued

 

512

 

474

 

(986)

 

Redemption of loans

 

 

(1,347)

 

1,347

 

Net cash from operating activities

 

 

 

(811)

 

(811)

Capital expenditures

 

 

 

588

 

588

Acquisitions and divestments

 

 

 

38

 

38

Dividends

 

 

 

280

 

280

Transfers from long-term to short-term

 

(663)

 

663

 

 

Effect of exchange rate changes on cash and cash equivalents

 

23

 

 

(70)

 

(47)

Other changes

 

(11)

 

60

 

(20)

 

29

Net debt equivalents at year-end

 

2,527

 

811

 

(1,732)

 

1,606