Cash Flow
Net Cash Flow
In 2019, WACKER complied with its long-term policy of financing investments essentially from its own cash flow. Net cash flow totaled €184.4 million in 2019 (2018: €86.2 million), demonstrating that long-term investments are covered largely by cash flow from operating activities.
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€ million |
2019 |
2018 |
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Cash flow from operating activities (gross cash flow) |
605.0 |
509.6 |
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Cash flow from long-term investing activities before securities |
-420.6 |
-423.4 |
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Additions from finance leases |
– |
– |
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Net cash flow |
184.4 |
86.2 |
Net cash flow is the sum of cash flow from operating activities and cash flow from long-term investing activities (before securities). In 2019, WACKER changed its definition of net cash flow, with the change in advance payments received no longer being eliminated from gross cash flow. The comparative figure was adjusted accordingly and is thus €38.5 million lower.
Net Cash Flow
€ million
Gross Cash Flow
In 2019, cash flow from operating activities (gross cash flow) totaled €605.0 million (2018: €509.6 million). Aside from the negative net result for the year of €-629.6 million (2018: €260.1 million), gross cash flow was reduced by cash outflows of €35.4 million from working capital (2018: €182.7 million). The depreciation/amortization and impairments of €1.32 billion (2018: €540.4 million) in the net result includes the impairment charge on WACKER POLYSILICON’s fixed assets. Cash outflows from working capital were mainly due to payments made to settle trade payables. Lower tax payments of €10.5 million (2018: €152.0 million) benefited gross cash flow. The profit from investments in joint ventures and associates of €54.3 million (2018: €131.7 million) included in the net result reduced gross cash flow. Siltronic AG’s dividend payment of €46.2 million lifted gross cash flow. The insurance compensation of €112.5 million and the special payment of €70.7 million to the pension fund also influenced gross cash flow.
Cash Flow from Operating Activities (Gross Cash Flow)
€ million
Cash Flow from Long-Term Investing Activities
The Group’s investment projects influence cash flow from long-term investing activities. In 2019, cash payments of €-415.1 million for investments were on par with the year-earlier figure (2018: €-408.8 million). WACKER made over half of these capital expenditures in Germany. In the prior year, WACKER BIOSOLUTIONS paid €21.0 million to acquire a biologics production site in Amsterdam. Cash flow from long-term investing activities amounted to €-420.6 million in the 2019 reporting year (2018: €-423.4 million).
Cash Flow from Long-Term Investing Activities Before Securities
€ million
Cash Flow from Financing Activities
Cash flow from financing activities totaled €-26.2 million in the reporting year (2018: €-240.5 million). It reflects the balance of external financial liabilities of €142.0 million (2018: €-7.9 million). The dividend of €124.2 million paid by Wacker Chemie AG in Q2 2019 was a key component of cash outflows. The new accounting standard for leases meant that repayments of lease liabilities increased to €-34.8 million (2018: €-4.3 million).
Cash and Cash Equivalents
Cash and cash equivalents increased to €435.8 million (2018: €341.1 million). Liquidity from cash and from current and noncurrent securities rose as well, from €387.5 million to €545.2 million.
IFRS 16 Affects Net Financial Debt
WACKER defines net financial debt – which is one of its financial indicators – as the balance of gross financial debt (current and noncurrent financial liabilities) and existing noncurrent and current liquidity, consisting of securities, cash and cash equivalents. Net financial debt amounted to €713.7 million as of December 31, 2019 (Dec. 31, 2018: €609.7 million), up 17 percent year over year.
The main reason for the rise of €120.3 million in net financial debt was the new method of lease accounting introduced by IFRS 16.
Aside from the financial liabilities disclosed in the report on net assets, WACKER has at its disposal adequate unused syndicated loans for around €600 million, with maturities of over one year. Our existing lines of credit provide us with enough financial scope to secure the Group’s continued growth. The Group does not use any off-balance-sheet financing instruments.
Net Financial Debt
€ million
