Statement of Cash Flows

• Cash flows from operating activities and free cash flow lower year on year

Cash flows from operating activities amounted to €7,474 million, €465 million below the 2018 figure. The decrease was mainly due to lower net income after accounting for the reclassification of disposal gains from divestitures in the amount of €5,874 million to cash flows from investing activities. This was partly offset by the contribution from the change in net working capital, which improved by €1,940 million. This development was driven by the cash released from the €1,208 million reduction in trade accounts receivable in 2019, compared with cash tied up of €188 million in the previous year. In addition, inventories were reduced in 2019, after significant inventory growth in the previous year.

Cash flows from investing activities amounted to minus €1,190 million in 2019, compared with minus €11,804 million in 2018. Payments made for intangible assets and property, plant and equipment amounted to €3,824 million, only slightly lower than in the previous year. The change mainly resulted from acquisitions and divestitures. Payments received for divestitures in 2019 were €2,493 million higher than in the previous year. This was primarily attributable to the total inflow of €2,393 million from the merger of Wintershall and DEA’s oil and gas businesses, largely due to the repayment of internal loans and the implementation of capital measures. Payments made for acquisitions amounted to €239 million in 2019, compared with €7,362 million in the previous year. In the previous year, these mainly related to the purchase price payment to Bayer, which amounted to €7,208 million including liquid funds assumed.

Cash released from changes in financial assets and miscellaneous items amounted to €273 million in 2019, after cash tied up of €655 million in 2018. This was mainly attributable to higher disposals of intangible assets and property, plant and equipment, as well as of other financing-related receivables compared with the previous year.

Cash flows from financing activities amounted to minus €6,405 million in 2019, after minus €52 million in 2018. The net cash outflow from the change in financial and similar liabilities was €3.3 billion in 2019. This was largely due to the €1.7 billion reduction in U.S. dollar commercial paper by BASF SE and the repayment of bonds in the amount of €2.0 billion. The net cash inflow of €3.0 billion in the previous year was mainly from the issue of U.S. dollar commercial paper by BASF SE with a carrying amount of around €2.5 billion. In 2019, dividends of €2,939 million were paid to shareholders of BASF SE and €125 million to noncontrolling interests, on a level with the previous year overall.

Cash and cash equivalents amounted to €2,455 million as of December 31, 2019. They declined by a cash-effective amount of €121 million in 2019.

Free cash flow, which remains after deducting payments made for intangible assets and property, plant and equipment from cash flows from operating activities, represents the financial resources remaining after investments. It declined to €3,650 million compared with €4,045 million in the previous year due to the decrease in cash flows from operating activities.

Cash flow

Billion €