Condensed consolidated statements of cash flows
|
||||||
Fourth quarter |
|
January-December |
||||
|---|---|---|---|---|---|---|
2018 |
2019 |
in € millions |
2018 |
2019 |
||
952 |
1,155 |
Net cash and cash equivalents at beginning of period |
1,278 |
2,732 |
||
Adjustments to reconcile earnings to cash generated from operating activities |
||||||
45 |
80 |
Profit for the period from continuing operations |
455 |
555 |
||
59 |
99 |
Amortization and depreciation |
239 |
360 |
||
1 |
5 |
Impairment losses |
1 |
66 |
||
23 |
18 |
Financing income and expenses |
52 |
76 |
||
(6) |
(4) |
Results from associates and joint ventures |
(20) |
(20) |
||
(2) |
(12) |
Pre-tax result on acquisitions and divestments |
(42) |
(83) |
||
6 |
79 |
Income tax |
118 |
230 |
||
250 |
258 |
Changes in working capital |
(177) |
(244) |
||
– |
– |
Pension pre-funding * |
– |
(161) |
||
61 |
(12) |
Changes in pension provisions |
(157) |
(509) |
||
(16) |
(4) |
Changes in other provisions |
(46) |
(15) |
||
(48) |
(16) |
Interest paid |
(89) |
(66) |
||
(53) |
(52) |
Income tax paid |
(164) |
(184) |
||
(1) |
15 |
Other changes |
(8) |
28 |
||
319 |
454 |
Net cash from operating activities |
162 |
33 |
||
(64) |
(79) |
Capital expenditures |
(184) |
(214) |
||
(80) |
(212) |
Acquisitions and divestments net of cash acquired/divested |
(74) |
(120) |
||
(5,541) |
(760) |
Investment in short-term investments |
(5,541) |
(2,325) |
||
80 |
1,594 |
Repayments of short-term investments |
80 |
7,663 |
||
6 |
3 |
Other changes |
51 |
8 |
||
(5,599) |
546 |
Net cash from investing activities |
(5,668) |
5,012 |
||
(1,340) |
(528) |
Changes from borrowings |
(922) |
(613) |
||
(135) |
(93) |
Dividend paid |
(636) |
(1,446) |
||
– |
– |
Capital repayment |
– |
(2,000) |
||
– |
(314) |
Share buyback |
– |
(2,520) |
||
(407) |
– |
Buy-out of non-controlling interests |
(437) |
– |
||
3 |
(1) |
Other changes |
5 |
– |
||
(1,879) |
(936) |
Net cash from financing activities |
(1,990) |
(6,579) |
||
(7,159) |
64 |
Net cash used for continuing operations |
(7,496) |
(1,534) |
||
8,924 |
(5) |
Cash flows from discontinued operations |
8,958 |
(10) |
||
1,765 |
59 |
Net change in cash and cash equivalents of continued and discontinued operations |
1,462 |
(1,544) |
||
15 |
(4) |
Effect of exchange rate changes on cash and cash equivalents |
(8) |
22 |
||
2,732 |
1,210 |
Net Cash and cash equivalents at |
2,732 |
1,210 |
||
IFRS 16 “Leases” was adopted per January 1, 2019, applying the modified retrospective method. The payments for the operating leases, in 2018 reported in the cash flow from operating activities, as from January 1, 2019, are included in the cash flow from financing activities. In 2019, the adoption of IFRS 16 resulted in €108 million of lease expenses being presented as redemption of lease liabilities in Net cash from financing activities; this amount was previously recorded in Net cash from operating activities. The 2018 comparative figures have not been restated.
Cash flows and net debt
Net cash from operating activities in Q4 2019 resulted in an inflow of €454 million (2018: inflow of €319 million). This increase was driven by the aforementioned implementation of IFRS 16, increased profit for the period and lower interest paid, which was partly offset by changes in provisions. Full-year 2019 Pension pre-funding concerns the €161 million of pre-funding payments into an escrow account for the Akzo Nobel (CPS) Pension Scheme. Full-year 2019 changes in pension provisions include top-up payments of €481m (2018: €187 million).
Net cash from investing activities in Q4 2019 resulted in an inflow of €546 million (2018: outflow of €5,599 million). Net cash from investing activities was mainly impacted by an outflow for acquisitions and the net cash inflow from the short-term investments of €834 million.
Net cash from financing activities in Q4 2019 resulted in an outflow of €936 million (2018: outflow of €1,879 million). Net cash from financing activities was mainly impacted by the repayments of loans, the interim dividend 2019, the share buyback (€314 million) and the impact of the implementation of IFRS 16 leading to €25 million redemption of lease liabilities.
At December 31, 2019, net debt was positive €802 million versus negative €5,861 million at year-end 2018. This was mainly due to the share buyback (€2.5 billion), a capital repayment (€2.0 billion), a special cash dividend payment (€1.0 billion), pension related payments (€642 million), the final dividend 2018 (€315 million), capital expenditures (€214 million) and net cash outflow for acquisitions and divestments (€120 million).