Wacker Chemie AG’s total assets came to €5.15 billion (Dec. 31, 2015: €5.14 billion). The individual balance-sheet items did not develop uniformly.

In 2016, fixed assets increased to €3.86 billion (Dec. 31, 2015: €3.29 billion), with property, plant and equipment, on the one hand, and financial assets, on the other, following different paths. Property, plant and equipment decreased year over year, as depreciation in the amount of €291.9 million (Dec. 31, 2015: €307.8 million) exceeded investment spending of €141.7 million (Dec. 31, 2015: €135.2 million). Financial assets grew from €2.00 billion to €2.72 billion. This item contains a €600 million loan to Wacker Chemical Corporation, a subsidiary, to replace the previous short-term financing for the new production site in Charleston, Tennessee. In addition, Wacker Chemie AG’s stake in a closed-end securities fund was increased in 2016. The fund assets came to €106.4 million as of the reporting date (Dec. 31, 2015: €6.4 million). The ratio of fixed assets to total assets was 75 percent, compared with 64 percent in the prior year.

The level of inventories remained almost constant year over year at €424.8 million (Dec. 31, 2015: €428.3 million). On the other hand, trade receivables rose from €357.7 million to €414.0 million.

Other receivables and other assets fell by 60 percent to €361.7 million as of the closing date (Dec. 31, 2015: €920.6 million). They included significantly lower receivables from affiliated companies amounting to €296.6 million (Dec. 31, 2015: €868.1 million), chiefly due to the long-term financing for the production site in Charleston, Tennessee.

Statement of Financial Position

The fixed-term deposits amounting to €20 million and with maturities of more than three months that had been made in the preceding year matured in 2016. Wacker Chemie AG’s cash on hand and demand deposits came to €88.7 million as of December 31, 2016 (Dec. 31, 2015: €118.1 million).

Equity amounted to €2.65 billion as of the reporting date (Dec. 31, 2015: €2.63 billion), corresponding to an equity ratio of 51.4 percent (Dec. 31, 2015: 51.1 percent). At Wacker Chemie AG’s annual shareholders’ meeting, a resolution was passed to distribute a dividend of €99.4 million from the profit carried forward from 2015. The remaining retained profit of €1,122.4 million was carried forward. Retained profit as of December 31, 2016 totaled €1,243.8 million and primarily comprised the current net income of €121.4 million for 2016 and the non-distributed profit carried forward from the preceding year.

Provisions for pensions and similar obligations rose by a slight €12.2 million to €705.8 million (Dec. 31, 2015: €693.6 million). 2016 was the first year in which discounting was based on the average market interest rate over the past ten fiscal years. Other provisions increased by €84.7 million to €413.5 million in 2016 (Dec. 31, 2015: €328.8 million) and primarily comprised provisions for taxes, personnel and environmental protection. The main reasons for this increase were to secure future financing of the Pensionskasse der Wacker Chemie VVaG pension fund and to establish a provision relating to the contract manufacturing of polysilicon. Tax provisions, in particular, also rose. Overall, provisions accounted for 22 percent of total equity and liabilities, following 20 percent in the prior year.

As of the reporting date, financial liabilities amounted to €647.0 million (Dec. 31, 2015: €855.3 million), down 24 percent. This decrease was chiefly due to the repayment of bank loans. As of the reporting date, bank loans raised amounted to €545.2 million (Dec. 31, 2015: €756.1 million). Liabilities due to affiliated companies rose by €2.6 million to €98.3 million as of the reporting date (Dec. 31, 2015: €95.7 million). Overall, the share of financial liabilities in total equity and liabilities declined to 13 percent (Dec. 31, 2015: 17 percent).

Trade payables increased by €36.2 million year over year to €184.2 million (Dec. 31, 2015: €148.0 million). As of the reporting date, other liabilities amounted to €516.5 million (Dec. 31, 2015: €450.0 million). This rise was primarily due to as-yet unpaid obligations relating to a polysilicon manufacturing contract with the subsidiary Wacker Polysilicon North America, L.L.C. The decline in advance payments received under polysilicon contracts had the opposite effect.

Accruals and deferrals amounted to €38.2 million as of year-end 2016 (Dec. 31, 2015: €38.8 million) and mainly concerned a payment by Siltronic AG to Wacker Chemie AG in return for the transfer of employees to the latter.

Cash flow from operating activities improved to €520.7 million (2015: €501.3 million), chiefly due to higher liabilities in connection with contract manufacturing. Lower net income for the year had the opposite effect. In addition, higher non-cash expenses incurred to increase provisions had a positive impact in the reporting year. As expected, advance payments received for polysilicon deliveries declined by € –161.1 million in line with the deliveries made and the advance payments retained in connection with terminated contracts.

At € –223.8 million, Wacker Chemie AG’s cash outflow from investing activities was somewhat higher (2015: € –182.1 million). Cash not immediately needed was used to increase the closed-end fund, which led to a cash outflow of €100.0 million. In contrast, the cash inflow from the sale of securities equaled €20 million. Funds also went toward ongoing investments in property, plant and equipment. At €137.0 million, these were somewhat lower year over year (2015: €144.6 million).

Net cash flow – defined as the sum of cash flow from operating activities excluding the change in advance payments received and cash flow from long-term investing activities (before securities) – rose substantially again in the year under review, coming in at €537.9 million (2015: €352.9 million).

Cash flow from financing activities totaled € –326.3 million (2015: € –304.9 million). In 2016, the available funds were used to reduce liabilities to banks by €200.0 million (2015: €150.0 million). The amount of intra-Group financing rose only slightly. The dividend for fiscal 2015 led to a cash outflow of € –99.4 million.

Liquidity – defined as the sum of securities in current assets, shares in closed-end investment funds, and cash on hand and demand deposits – increased slightly, from €144.5 million to €195.1 million as of December 31, 2016. Net financial debt – which is the balance of liquidity as defined above and liabilities to financial institutions – fell substantially due to investment in the closed-end fund and the continued repayment of liabilities to banks. Here, the improved net cash flow had a particularly positive impact. At year-end 2016, net financial debt amounted to €350.1 million (2015: €611.6 million).