HSBC 2007 Annual Report Download - page 342

HSBC HOLDINGS PLC
Financial Statements (continued)
340
Consolidated cash flow statement for the year ended 31 December 2007
2007 2006 2005
Notes US$m US$m US$m
Cash flows from operating activities
Profit before tax ................................................................................... 24,212 22,086 20,966
Adjustments for:
– non-cash items included in profit before tax ............................... 40 21,662 14,956 11,404
– change in operating assets ............................................................ 40 (176,538) (175,317) (91,753)
– change in operating liabilities ...................................................... 40 250,095 237,378 72,212
– elimination of exchange differences1 ........................................... (18,563) (12,114) 2,580
– net gain from investing activities ................................................. (2,209) (2,014) (692)
– share of profits in associates and joint ventures .......................... (1,503) (846) (644)
– dividends received from associates .............................................. 363 97 114
– contribution paid to defined benefit plans ................................... (1,393) (547) (2,547)
– tax paid ......................................................................................... (5,088) (4,946) (4,619)
Net cash from operating activities ....................................................... 91,038 78,733 7,021
Cash flows from investing activities
Purchase of financial investments ....................................................... (260,980) (286,316) (378,103)
Proceeds from the sale and maturity of financial investments ........... 238,647 273,774 368,696
Purchase of property, plant and equipment ......................................... (2,720) (2,400) (2,887)
Proceeds from the sale of property, plant and equipment ................... 3,178 2,504 620
Proceeds from the sale of loan portfolios ............................................ 1,665 2,048 –
Net purchase of intangible assets ........................................................ (950) (852) (849)
Net cash outflow from acquisition of and increase in stake of
subsidiaries ...................................................................................... (623) (1,185) (1,662)
Net cash inflow from disposal of subsidiaries .................................... 187 62 705
Net cash outflow from acquisition of and increase in stake
of associates ..................................................................................... (351) (585) (2,569)
Net cash inflow from the consolidation of funds ................................ 1,600 – –
Proceeds from disposal of associates .................................................. 69 874 422
Net cash used in investing activities ................................................... (20,278) (12,076) (15,627)
Cash flows from financing activities
Issue of ordinary share capital ............................................................. 474 1,010 690
Issue of preference shares .................................................................... – 374 1,298
Net purchases and sales of own shares for market-making and
investment purposes ........................................................................ 126 46 (55)
Purchases of own shares to meet share awards and share
option awards .................................................................................. (636) (575) (766)
On exercise of share options ............................................................... 104 173 277
Subordinated loan capital issued ......................................................... 5,705 5,948 2,093
Subordinated loan capital repaid ......................................................... (689) (903) (1,121)
Dividends paid to shareholders of the parent company ...................... (6,003) (5,927) (5,935)
Dividends paid to minority interests ................................................... (718) (710) (508)
Net cash used in financing activities ................................................... (1,637) (564) (4,027)
Net increase/(decrease) in cash and cash equivalents .................... 69,123 66,093 (12,633)
Cash and cash equivalents at 1 January .............................................. 215,486 141,307 160,956
Exchange differences in respect of cash and cash equivalents ........... 12,400 8,086 (7,016)
Cash and cash equivalents at 31 December ........................................ 40 297,009 215,486 141,307
1 Adjustment to bring changes between opening and closing balance sheet amounts to average rates. This is not done on a line-by-line
basis, as details cannot be determined without unreasonable expense.
The accompanying notes on pages 344 to 452, the audited sections of the ‘Report of the Directors: The Management of Risk’ on pages
192 to 288, ‘Critical accounting policies’ on pages 132 to 134 and ‘Off-balance sheet arrangements and special purpose entities’ on pages
183 to 191 form an integral part of these financial statements.