Free cash flow and underlying free cash flow are calculated as follows:
| XLS |
|
|
|
|
|
€ million |
2011 |
2010 |
|
Net cash flows from operating activities |
1,271.2 |
1,782.6 |
|
Purchase of intangible assets |
–79.7 |
–104.2 |
|
Purchase of property, plant and equipment |
–366.3 |
–396.2 |
|
Acquisitions |
–161.0 |
–4,843.7 |
|
Investments in financial assets |
–10.5 |
–16.0 |
|
Disposal of non-current assets |
787.4 |
54.8 |
|
Purchase/sale of marketable securities |
–4.7 |
0.2 |
|
Free cash flow |
1,436.4 |
–3,522.5 |
|
|
|
|
|
External financing of pension obligations Merck KGaA (CTA) |
301.9 |
– |
|
Acquisition-related payments |
168.1 |
4,941.9 |
|
Payments related to divestments of business |
–511.8 |
250.4 |
|
Underlying free cash flow |
1,394.6 |
1,669.8 |
Free cash flow and underlying free cash flow are indicators that we use internally to measure the contribution of our divisions to liquidity. Free cash flow includes all net cash flows from operating activities as well as investing activities performed in connection with operating business. We do not include in free cash flow pure financial investments and similar monetary deposits of more than three months, which are also to be reported as net cash flows from investing activities under IFRS.
In the reconciliation of free cash flow to underlying free cash flow, the net payments for the external financing of the pension obligations of Merck KGaA (CTA) amounting to € 301.9 million as well as cash flows for both acquisitions and divestments are taken into account. The acquisition-related payments of € 168.1 million (2010: € 4,941.9 million) consist of acquisitions amounting to € 161.0 million (2010: € 4,843.7 million) as well as further payments amounting to € 7.1 million. These relate mainly to payments made in 2011 in connection with the acquisition of Millipore. In 2011, we received payments totaling € 200.9 million from the divestment of the Crop BioScience business, € 270.2 million from the divestment of Théramex, and € 40.7 million in connection with the divestment of the Generics business in 2006.