Cash Flow

Net Cash Flow

In 2020, WACKER clearly achieved its long-term policy of financing investments essentially from its own cash flow. Net cash flow totaled €697.7 million in 2020 (2019: €184.4 million).

Net cash flow is defined as the sum of cash flow from operating activities and cash flow from long-term investing activities (excluding securities).

Net Cash Flow

€ million

Gross Cash Flow

In 2020, cash flow from operating activities (gross cash flow) totaled €873.7 million (2019: €605.0 million). Aside from the net income for the year of €202.3 million (2019: €-629.6 million), gross cash flow was improved by positive changes of €100.0 million in working capital (2019: higher cash outflows of €35.4 million). Operating cash flow was increased by the depreciation/amortization and impairments of €403.5 million (2019: €1.32 billion) included in net income. In the previous year, depreciation/amortization and impairments had included the impairment charge on WACKER POLYSILICON’s fixed assets. The improvement in working capital was due primarily to lower inventories and to the higher level of trade payables at year-end. The profit of €34.9 million from investments in joint ventures and associates (2019: €54.3 million) included in net income for the year reduced gross cash flow. Siltronic AG’s dividend payment of €27.8 million lifted gross cash flow. The special payment of €73.4 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 are the key factors influencing cash flow from long-term investing activities. In 2020, cash payments of €-226.5 million for investments were less than the prior-year figure (2019: €-415.1 million). The WACKER Group reduced its investment spending in the wake of the coronavirus pandemic. More than half of the reported capital expenditures were made in Germany. WACKER received a partial repayment of €50.1 million on a strategic loan made to equity-accounted Dow Siloxanes (Zhangjiagang) Co. Ltd. Cash flow from long-term investing activities amounted to €-176.0 million in 2020 (2019: €-420.6 million).

Cash Flow from Long-Term Investing Activities Before Securities

€ million

Cash Flow from Financing Activities

Cash flow from financing activities totaled €117.1 million in the reporting year (2019: €-26.2 million). It reflects the impact of external financing liabilities for a net amount of €177.1 million (2019: €142.0 million). Wacker Chemie AG’s dividend payment of €24.8 million led to a cash outflow in the third quarter. Repayments of lease liabilities amounted to €-31.8 million (2019: €-34.8 million).

Cash and Cash Equivalents

Cash and cash equivalents increased to €626.0 million (2019: €435.8 million). Liquidity from cash and from current and noncurrent securities rose markedly, from €545.2 million to €1,338.0 million.

High Liquidity Reduces 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 financing liabilities) and existing noncurrent and current liquidity, consisting of securities, cash and cash equivalents. Net financial debt amounted to €67.5 million as of December 31, 2020 (Dec. 31, 2019: €713.7 million), down 91 percent year over year.

The decrease in net financial debt is primarily attributable to the cash inflows from operating activities and to lower investment spending.

Aside from the financing liabilities disclosed in the report on net assets, WACKER has at its disposal an adequate amount (more than €600 million) in unused lines of credit 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 engage in any off-balance-sheet financing.

Net Financial Debt

€ million