Change

Condensed balance sheet


Condensed consolidated balance sheet

 

 

 

in € millions

2009

2010

 

 

 

Intangible assets

7,388

7,308

Property, plant and equipment

3,474

3,384

Other financial non-current assets

1,783

1,977

Total non-current assets

12,645

12,669

Inventories

1,441

1,678

Trade and other receivables

2,564

2,788

Cash and cash equivalents

2,128

2,851

Other current assets

102

108

Total current assets

6,235

7,425

Total assets

18,880

20,094

Total equity

8,245

9,509

Provisions and deferred tax liabilities

2,593

2,444

Long-term borrowings

3,488

2,880

Total non-current liabilities

6,081

5,324

Short-term borrowings

384

907

Trade and other payables

2,866

3,305

Other short-term liabilities

1,304

1,049

Total current liabilities

4,554

5,261

Total equity and liabilities

18,880

20,094

Invested capital

Invested capital at year-end 2010 totaled €12.7 billion, €1 billion higher than at year-end 2009. Invested capital was impacted by the following items:

  • Foreign currency effects on intangibles and property, plant and equipment, due to the weakening euro. In total, equity increased by €0.8 billion due to the currency translation impact.
  • An increase of €269 million of long-term receivables related to pension funds in an asset position.
  • Acquisitions, primarily the acquired powder coatings activities.
  • An increase of operating working capital due to currencies and increased business activities. Expressed as a percentage of revenue, operating working capital was 13.9 percent (year-end 2009: 13.7 percent).
  • Payments of accrued interest of €159 million in January 2010, being the first payment under bonds refinanced in late 2008 and the first half of 2009. The normalized cash outflow for these bonds is €148 million.

We intend to accelerate growth and expand our investments in high growth regions. In 2011, we aim to invest 4 percent of revenue in capital expenditures.

Operating working capital in € millions

Operating working capital (bar chart)

Net debt

Net debt decreased from €1,744 million at year-end 2009 to €936 million at year-end 2010, mainly due to:

  • The divestment of National Starch, generating €1 billion of cash
  • Operating cash inflows of €519 million
  • Dividend payments of €403 million (including to non-controlling interests)
  • Capital expenditures of €534 million.

A bond totaling €539 million will mature in June 2011 and is recorded under short-term borrowings. In August, our credit ratings were confirmed at BBB+/Baa1 with outlook improved to stable.

The proceeds from the disposal of National Starch will fund growth and will potentially partly be used to realize our growth plans, strengthen the company’s capital structure by, for example, repaying the 2011 €539 million debt maturity or de-risking pensions where possible.

Shareholders’ equity

Shareholders’ equity as at December 31, 2010, increased to €9.0 billion, due to the net effect of:

  • Net income of €754 million
  • Increased cumulative translation reserves by €734 million due to the weakening euro
  • Payment of the final 2009 dividend of €245 million and the 2010 interim dividend of €75 million.

Pensions

The funded status of the pension plans at year-end 2010 was estimated to be a deficit of €1.0 billion (year-end 2009: €1.9 billion). The movement is due to lower discount rates increasing the pension obligation, compensated by:

  • Increased asset values
  • Lower inflation expectations
  • Top-up payments of €375 million into certain defined benefit pension plans.

Invested capital in € millions

Invested capital (bar chart)
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