Business free cash flow of the Merck Group in 2013 amounted to € 2,960 million (2012: € 2,969 million), thus remaining at the previous year’s high level. The composition of this figure is presented in the Group management report under “Internal Management System”.
The distribution of business free cash flow across the individual quarters as well as the percentage changes in comparison with 2012 were as follows:
Merck Group | Business free cash flow and change by quarter1
Merck Group | Business free cash flow by division – 2013
The Merck Serono division generated business free cash flow amounting to € 1,876 million (2012: € 1,880 million), thus raising its contribution to Group business free cash flow to 58% (2012: 57%). This excludes the decline of € –281 million due to Corporate and Other. Performance Materials contributed € 788 million (2012: € 798 million) to Group business free cash flow, which once again represented 24%. Taken together, the Merck Millipore and Consumer Health divisions contributed 18% (2012: 19%) to Group business free cash flow.
Investments in property, plant, equipment and software included in the calculation of business free cash flow as well as advance payments for intangible assets increased in 2013 by 21.7% to a total of € 446 million (2012: € 367 million). In 2013, investments in property, plant and equipment included in this figure amounted to € 408 million (2012: € 329 million), corresponding to an increase of € 79 million or 24.0% compared with 2012. Investments in property, plant and equipment, which totaled € 408 million, included € 248 million in numerous smaller investment projects (total volume of each project below € 2 million). At the beginning of 2013, Merck acquired six office buildings in Darmstadt, which the company had previously leased. The buildings also house the headquarters of the Merck Serono division. In addition, major projects to expand production were also approved in 2013. Special mention is made here of an investment by Merck Serono in a new production plant in China with a total volume of € 80 million. The new facility will become Merck Serono’s second-largest pharmaceutical production site worldwide. Commercial production is scheduled to begin in 2017. In December 2013, work began on a major investment project for the Allergopharma unit in Reinbek near Hamburg. The estimated investment of around € 40 million will, in particular, serve to expand production capacities for products to diagnose and treat type 1 allergies. Within the scope of “Fit for 2018”, extensive investment projects to raise efficiency, particularly in the Merck Millipore and Performance Materials divisions were approved that relate to sites in Germany, the United States as well as Ireland and Spain.
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