Volvo 2001 Annual Report Download - page 24

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Cash flow
Cash flow after net investments, excluding
Financial Services, amounted to SEK 21.3
billion, of which the operating cash flow
(excluding the effects of acquisitions and
divestments) was SEK 3.4 billion. The posi-
tive development during 2001 was mostly
related to a reduction in tied-up working
capital, in particular inventories and receiv-
ables, while net interest and tax payments
had an adverse effect. All business areas
except Volvo Aero reported positive cash
flow in 2001. The transfer of interest-bearing
receivables from the truck operations in
North America to Financial Services had a
positive effect on cash flow of SEK 0.7 bil-
lion.
Cash flow after net investments within
Financial Services was negative in an amount
of SEK 5.3 billion. The divestment of the
holding in Volvofinans had a positive effect
on cash flow of SEK 0.9 billion during the
year while the sale of Volvia’s insurance
operations had an adverse effect of SEK 1.7
billion.
Capital expenditures
Capital expenditures for property, plant and
equipment in 2001 excluding Financial
Sevices amounted to SEK 5.7 billion (5.1).
Capital expenditures in Global Trucks,
which amounted to SEK 4.1 billion (3.2),
were made to increase efficiency in the pro-
duction of axles and cabs in Renault, and to
the development of the new nine-liter diesel
engine, D9 for Volvo Trucks. Investments
were also made relating to the new voca-
tional truck, Mack Granite. Capital expendi-
tures in Buses decreased to SEK 0.2 billion
(0.4). The level of capital expenditures in
Construction Equipment and Volvo Penta
remained at the same level as last year, SEK
0.4 billion and SEK 0.1 billion respectively.
The capital expenditures in Volvo Aero
amounted to SEK 0.7 billion (0.6) and were
made mainly in new engine alliance programs.
Investments in development of new prod-
ucts, production and information systems
amounted to SEK 2.0 billion. The invest-
ments are distributed among Global Trucks
SEK 1.6 billion, Buses SEK 0.2 billion,
Construction Equipment SEK 0.2 billion
and Volvo Penta SEK 0.1 billion.
Investments in leasing assets amounted to
SEK 5.9 billion, including SEK 5.1 billion in
Financial Services. The investments per-
tained mainly to the operations in North
America and Western Europe.
Acquisitions and divestments
Cash flow from investments in shares of
SEK 3.2 billion was mainly related to the
sale of Volvo’s holding in Mitsubishi Motors
Corporation. Investments in shares in 2000
was mainly attributable to additional invest-
ments in Scania and in 1999 to acquisitions
of shares in Scania AB and Mitsubishi
Motors Corporation.
Cash flow from acquired and divested
companies of SEK 14.7 billion mainly per-
tained to the final payment of SEK 12.1 bil-
lion from the sale of Volvo Cars, and
acquired liquid funds within Mack and
Renault V.I. The purchase price paid for
Mack and Renault V.I. did not affect cash
flow, since the payment was made with
Volvo shares held by AB Volvo. In 1999,
acquisitions and divestments of subsidiaries
and other business units resulted in a posi-
tive cash flow of SEK 31 billion, mostly
attributable to the divestment of Volvo Cars.
Cash flow statement
Future capital expenditures, approved
SEK bn
Global Trucks 4.3
Buses 0.3
Construction Equipment 0.1
Volvo Penta 0.0
Volvo Aero 0.7
Other 0.7
Total 6.1
Operating cash flow, excluding
Financial Services
SEK bn 1999 2000 2001
Operating income16.4 5.2 (1.0)
Depreciation and amortization 3.1 3.8 7.0
Other (3.9) (5.4) 3.7
Cash flow from
operating activities 5.6 3.6 9.7
Net investments in fixed
assets and leasing assets (4.4) (5.0) (7.1)
Customer finance
receivables, net 0.1 0.0 0.8
Operating cash flow,
Volvo Group, excluding
Financial Services 1.3 (1.4) 3.4
1 1999: excluding gain on sale of Volvo Cars, SEK 26.7 bn.
THE VOLVO GROUP YEAR 2001