Volvo 2006 Annual Report Download - page 58

Cash-flow statement
Operating cash fl ow, excluding Financial Services, increased to
SEK 12.6 billion in 2006 compared with 6.8 billion in 2005.
During the year, transfers were made to pension foundations
of SEK 3.3 billion (4.4).
ment of production sites within Renault Trucks
including the move from Villaverde to Bourg-
en-Bresse. Trucks’ capital expenditures also
included investments related to the new emis-
sion standards Euro4 and US’07, the final stage
of the modification in the Hagerstown plant for
engines and transmissions in North America
and also investments related to new products.
Investments within Construction Equipment
increased to SEK 1.7 billion from SEK 0.9 bil-
lion. The main part of the investments refer to
capacity increases and a new generation of
Excavators, the C-series. The investments
within Volvo Aero increased during 2006 to
SEK 1.0 billion from SEK 0.8 billion. A major
part of those investments refers to entrance
fees for phase two of the new GEnx engine in
cooperation with General Electrics. In
Trollhättan, Sweden, an extensive renewal of
FMS cells has been completed. The invest-
ments in Buses remains at the level of SEK 0.3
billion and were mainly related to the new gen-
eration of engines, and a new product program.
The level of investments remains in Volvo Penta
with SEK 0.2 billion and consist mainly of
capacity increasing investments and a new
paint shop in the Vara plant in Sweden.
Approved future capital expenditures in
property, plant and equipment amounted to
SEK 6.8 billion (7.8).
Investments in leasing assets amounted to
SEK 0.5 billion (0.3).
Cash flow
Operating cash flow, excluding Financial
Services, amounted to SEK 12.6 billion. The
positive development during 2006 was mainly
related to an increase in earnings. During the
year transfers were made to pension founda-
tions, which is reported in the item ”Change in
working capital”, in the amount of SEK 3.3
billion.
Operating cash flow within Financial Ser-
vices was a negative SEK 1.8 billion in 2005
(negative 4.4) as a result of continued growth
in the credit portfolio.
Investments
Investments in fixed assets during 2006,
excluding Financial Services, amounted to SEK
9.7 billion (9.9). Capital expenditures in Trucks
amounted to SEK 6.0 billion (6.7). The invest-
ments within Trucks were made in a new top
coat line for cabs in Umeå, Sweden, increasing
the number of Volvo Truck Centers (mainly in
Europe), energy saving investments in the
Macungie-plant in North America and develop-
Future capital expenditures,
approved1
SEK bn
Trucks 4.8
Buses 0.1
Construction Equipment 0.7
Volvo Penta 0.2
Volvo Aero 0.5
Other 0.5
Total 6.8
1 In property, plant and equipment.
Condensed cash-flow statements,
Financial Services
SEK bn 2004 2005 2006
Cash flow from
operating activities (2.5) (4.2) (1.4)
Net investments (3.0) (0.2) (0.4)
Operating cash flow (5.5) (4.4) (1.8)
05
10.2
06
10.2
03
5.9
02
6.4
04
7.5
4.4 4.13.43.6 3.7
Capital expenditures,
SEK bn
Capital
expenditures,
% of net sales
Capital expenditures
1,
excluding Financial Services
Self-financing ratio
1,
excluding Financial Services, %
1 Years 2004, 2005 and 2006 are
reported in accordance with IFRS
and 2002 and 2003 in accordance
with Swedish GAAP. See Note 1
and 3.
05
173
06
235
03
243
02
196
04
268
Cash-flow from operating activities
divided by net investments in fixed
assets and leasing assets.
1 Years 2004, 2005 and 2006 are
reported in accordance with IFRS
and 2002 and 2003 in accordance
with Swedish GAAP. See Note 1
and 3.
54 Board of Directors’ Report 2006