Cash Flow

In 2009, the Group funded its investments almost entirely out of its own cash flow. At €767.5 million, cash inflow from operating activities was 23.7% lower than 2008 (€1.01 billion) due not only to a marked drop in the net result for the year, but also to lower customer advance payments for future polysilicon shipments compared to a year earlier. Cash inflows from advance payments were €36.9 million (2008: €197.7 million). Adjusted for non-cash expenses and income from provisions and depreciation, the net result declined by €241.4 million to €663.8 million, down 26.7% from 2008. Cash inflow benefited from inventories being lower than in 2008. Here, WACKER systematically adjusted inventories to match production quantities. Other liabilities declined in 2009 because profit-sharing was below 2008’s level. As a result, gross cash flow decreased. WACKER’s obligation to assume a share of the losses when exiting WACKER SCHOTT Solar and to repay pro rata the advance payments received led to a total cash outflow of €64.0 million.

Investments Funded almost Entirely out of Own Cash Flow

Cash Flow from Operating Activities (Gross Cash Flow) Cash Flow from Operating Activities (Gross Cash Flow) (bar chart)

In 2009, liquidity outflows for investments in intangible assets, property, plant and equipment, and financial assets fell to €800.4 million (2008: €983.7 million). Funds primarily flowed into the expansion of our production facilities for polysilicon, siloxane and dispersible polymer powder. Spending on new production facilities amounted to €770.5 million. In addition, WACKER made capital contributions of €32.1 million to joint ventures. In the prior-year period, €171.2 million had been spent on the complete acquisition of shares in Air Products Polymers and Wacker Polymer Systems, our former joint ventures.

Cash Flow from Investment Activities Cash Flow from Investment Activities (bar chart)

All of the German government securities (“Bundeswertpapiere”) acquired in 2008 were sold, which boosted our investment-activity cash flow by €101.1 million.

Net cash flow (the difference between cash inflow from operating activities and cash outflow due to noncurrent investment activities) amounted to €-32.9 million in 2009 – a decline of €54.6 million compared to 2008 (€21.7 million).

Net Cash Flow Net Cash Flow (bar chart)

In 2009, cash inflow from financing activities totaled €92.5 million (2008: €-87.7 million). This includes minority shareholder Dow Corning’s capital contributions to a joint venture in China. The distribution of €90.1 million in dividends to shareholders (primarily €89.4 million to Wacker Chemie AG’s shareholders) reduced cash flow from financing activities. Increased bank liabilities resulted in a cash inflow of €215.7 million. Bank liabilities rose mainly because WACKER took out long-term loans amounting to €180.0 million.

Cash and cash equivalents resulting from cash flows and adjusted for exchange-rate fluctuations went up by €159.4 million to €363.6 million as of year-end 2009.