Statement of Cash Flows

Cash flows from operating activities amounted to €8,111 million, compared with €7,709 million in the previous year. The improvement was primarily due to cash inflow from net working capital.

Net income increased by €852 million year on year to €225 million. Depreciation and amortization of property, plant and equipment and intangible assets were €740 million above the prior-year figure, in particular due to impairments. The non-cash-effective equity results improved by €4,577 million. In the previous year, these included the negative earnings contribution of -€4,853 million from Wintershall Dea AG, Kassel / Hamburg, Germany. The adjusted earnings for the aforementioned noncash items therefore decreased by €2,985 million compared with the previous year.

In 2023, dividends received from investments accounted for using the equity method amounted to €622 million following €1,629 million in the previous year. The main reason for the decline was the €716 million decrease in dividend payments from Wintershall Dea AG.

The reduction in inventories in 2023 released cash amounting to €1,896 million. In contrast, €1,991 million was tied up in an inventories buildup in the previous year. The change in trade accounts receivable led to a cash inflow of €1,443 million, an increase of €1,223 million compared with the previous year. The cash outflow from the trade accounts payable change amounted to €1,544 million, compared with an inflow of €451 million in the previous year. Funds amounting to €1,918 million were released from other operating assets, an increase of €1,621 million compared with 2022. The increase in cash released was mainly the result of a stronger reduction in precious and industrial metal trading items and tax receivables. The change in other operating liabilities and pension provisions led to a cash outflow of €730 million, an increase of €246 million compared with the previous year.

Cash flows from investing activities totaled -€4,991 million in 2023, after -€3,778 million in the previous year. Payments made for property, plant and equipment and intangible assets rose by €1,020 million to €5,395 million, mainly due to investments in the new Verbund site in Zhanjiang, China. In 2023, cash flows from investing activities included payments made for acquisitions of €5 million. As in the previous year, these related to an adjusted purchase price payment for Solvay’s polyamide business. Payments received for divestitures in the amount of €32 million resulted from minor transactions. In the previous year, payments received in the amount of €691 million resulted primarily from the sale of shares in the Hollandse Kust Zuid wind farm and the sale of the kaolin minerals business.

Cash flows from financing activities amounted to -€2,905 million. In addition to the payment of dividends in the amount of €3,094 million (2022: €3,248 million), BASF bought back own shares worth €70 million (2022: €1,331 million). This was partially offset by net additions to financial and similar liabilities of €259 million (2022: €565 million).

Free cash flow, which remains after deducting payments made for property, plant and equipment and intangible assets from cash flows from operating activities, represents the financial resources remaining after investments. It amounted to €2,715 million in 2023 following €3,333 million in the previous year.

• For more information on the statement of cash flows, see Note 26 to the Consolidated Financial Statements

Cash flow

Billion €