Volvo 2007 Annual Report Download - page 50
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Please find page 50 of the 2007 Volvo annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Cash-fl ow statement
– strong cash fl ow in
operating activities
Operating cash fl ow in the Industrial Operations increased to SEK 15.2 billion
in 2007 compared with SEK 12.6 billion in 2006. The improvement was
mainly due to lower operating capital and a positive earnings trend.
the cab factory in Umeå, Sweden, as well as
investments related to the US07 emission
standards. Trucks’ investments also included
continued renewal of the Renault Trucks sites,
a new crankshaft plant in Spain and invest-
ments related to renewals and improvements
in the product program. Capital investments
for Construction Equipment increased to SEK
2.6 billion from SEK 1.7 billion previous year.
The main part of the investments refers to
capacity increases within the axle and trans-
mission production as well as to accommodate
a rapidly expanding excavator business. The
investments made within Volvo Aero remained
at the level of SEK 1.0 billion. The main part of
the investments refers to the new GEnx
engine in cooperation with General Electrics
and capacity and effi ciency increasing
investments in the production facilities. The
investments in Buses remained at the level of
SEK 0.3 billion and were mainly related to the
investment in the body plant in India, quality
improving investments in the Polish factory
and part of the new product program. The
level of investments in Volvo Penta rose to
SEK 0.4 billion (0.2) and consisted mainly of
capacity increasing investments in the Vara plant
in Sweden and test equipment. Approved future
capital expenditures in property, plant and equip-
ment amounted to SEK 10.4 billion (6.8) for the
Volvo Group. Investments in leasing assets in the
Industrial Operations amounted to SEK 0.2 billion
(0.5).
Acquisitions and divestments
In 2007 Petro Stopping Centers and Sörred
Energi as well as a few dealers were divested.
Investments and divestments in shares and
participation had a positive impact on cash
flow of SEK 0.4 billion (negative 5.8).
Acquired and divested companies 2007
had a negative impact on cash flow of SEK
15.0 billion (positive 0.5). The acquisition of
Nissan Diesel had a negative impact of SEK
6.5 billion and the acquisition of Ingersoll
Rand’s road development operations had a
negative impact of SEK 8.8 billion. Other
investments and divestments had a net posi-
tive impact of SEK 0.3 billion.
Cash fl ow
The Industrial operations’ operating cash
fl ow amounted to SEK 15.2 billion. The posi-
tive development during 2007 was mainly
related to a decrease of SEK 3.0 billion in
operating capital compared with 2006 and a
positive earnings trend of SEK 1.9 billion in
2007. Financial items and paid income taxes
had a SEK 6.0 billion negative effect on cash
fl ow, mainly through income tax payments.
Operating cash fl ow within Financial
Services was a negative SEK 8.6 billion in
2007 (negative 1.8) as a result of continued
growth in the credit portfolio.
Investments
The Industrial operations’ in fi xed assets dur-
ing 2007 amounted to SEK 10.1 billion (9.7).
Capital expenditures in Trucks amounted to
SEK 5.3 billion (6.0). The capital expenditures
within Trucks included to a large extent expan-
sion of the dealer network and workshops,
mainly in Europe, investments to improve pro-
ductivity and increase capacity, as example in
Capital expenditures, SEK bn
Capital expenditures, % of
net sales
0706050403
10.19.79.97.25.8
3.63.94.33.63.3
0706050403
265235173268243
Cash-flow from
operating activities
divided by net
investments in fixed
assets and leasing
assets.
1 Years 2004–2007 are reported in accordance with IFRS and 2003 in
accordance with Swedish GAAP. See Note 1 and 3.
Capital expenditures1, Industrial operations Self-fi nancing ratio1, Industrial operations, %
46 Board of Directors’ Report 2007