Free cash flow of the Merck Group amounted to € 1,436 million in 2011 compared to € –3.522 million in 2010. While the 2010 figure was characterized by the purchase price payment for Millipore, cash inflows of € 201 million from the divestment of the Crop BioScience business were recorded in 2011. In addition, the receipt of the purchase price payment for Théramex, our former women’s health business which we sold in 2010, had a positive impact of € 270 million on free cash flow in 2011. In 2011, € 161 million was spent on acquisitions. Moreover, in 2011, free cash flow was lowered by payments of € 119 million in connection with litigation. The corresponding provisions had been set up for this amount. Payments to externally finance the pension obligations of Merck KGaA (CTA) lowered free cash flow by € 302 million. The balance of interest paid and interest received also resulted in a decline in free cash flow compared to 2010. The cash outflow from interest paid increased in 2011 to € 163 million (2010: € 97 million). This increase is due to the interest payment date in March 2011 for major bonds issued in 2010 in order to finance the Millipore acquisition.
Underlying free cash flow, i.e. adjusted for the payments to externally finance pension obligations of Merck KGaA (CTA) as well for effects of acquisitions and divestments, decreased by 16% to € 1,395 million from € 1,670 million in 2010. This decline is mainly attributable to Corporate and Other, which also includes interest and tax payments, as well as to the Pharmaceuticals business sector. The cash outflow of Corporate and Other increased significantly by 31% from € –496 million to € –652 million. The contribution of the Pharmaceuticals business sector to underlying free cash flow decreased in 2011 by 8.0% to € 1,245 million. At € 801 million, the contribution of the Chemicals business sector to underlying free cash flow remained at the same level as in 2010 (€ 812 million).
Free cash flow and underlying free cash flow
back
