DHL 2012 Annual Report Download - page 195

e following table shows the calculation of free cash ow:
Calculation of free cash flow
 m
2011 2012
Net cash from / used in operating activities 2,371 –203
Sale of property, plant and equipment
and intangible assets 211 225
Acquisition of property, plant and equipment
and intangible assets –1,716 –1,639
Cash outflow arising from change in property,
plant and equipment and intangible assets –1,505 –1,414
Disposals of subsidiaries and other business units 58 39
Acquisition of subsidiaries and other business units – 84 –57
Cash outflow arising from acquisitions / divestitures –26 –18
Interest received 72 46
Interest paid –163 –296
Net interest paid –91 –250
Free cash flow 749 –1,885
Free cash ow is considered to be an indicator of how much
cash is available to the company for dividend payments or the
repay ment of debt. Free cash ow declined from  million in
the previous year to –, million in the year under review. is
is primarily due to the negative cash ow from operating activities,
which was exceptionally and signicantly reduced by the funding
of pension obligations mentioned above.
. Net cash from financing activities
Financing activities led to a cash inow of , million in the
year under review, compared with a cash outow of , million
in the previous year. In particular, the conventional corporate bond
and convertible bond issues resulted in proceeds of , million
from the issuance of non-current nancial liabilities. In addition
to the continued funding of pension obligations, part of the funds
raised was used to repay a bond that fell due in October . is
made a signicant contribution to the cash outow from repay-
ments of non-current liabilities, in the amount of  million.
e dividend payment to the shareholders of Deutsche Post ,
which rose once again, by  million to  million, was the
largest payment in nancing activities. Proceeds from issuing
shares or other equity instruments amounted to  million. e
equity component of the convertible bond is recognised in this
item. e  million rise in interest payments to  million is
due in particular to the interest payments related to the additional
 payment required by the tax authorities.
. Cash and cash equivalents
e cash inows and outows described above produced
cash and cash equivalents of , million; Note . is repre-
sents a year-on-year reduction of  million.
OTHER DISCLOSURES
 Risks and financial instruments of the Group
. Risk management
As a result of its operating activities, the Group is exposed to
nancial risks that may arise from changes in exchange rates, com-
modity prices and interest rates. Deutsche Post DHL manages these
risks centrally through the use of non-derivative and derivative
nancial instruments. Derivatives are used exclusively to mitigate
non-derivative nancial risks, and uctuations in their fair value
should not be assessed separately from the underlying transaction.
e Group’s internal risk guidelines govern the universe of
actions, responsibilities and necessary controls regarding the use
of derivatives. Financial transactions are recorded, assessed and
processed using proven risk management soware, which also
regularly documents the eectiveness of hedging relationships. To
limit counterparty risk from nancial transactions, the Group may
only enter into this type of contract with prime-rated banks. e
conditions for the counterparty limits individually assigned to the
banks are reviewed on a daily basis. e Group’s Board of Manage-
ment is informed internally at regular intervals about existing
nancial risks and the hedging instruments deployed to mitigate
them. Financial instruments are accounted for and measured in
accordance with  .
Liquidity management
e ultimate objective of liquidity management is to secure
the solvency of Deutsche Post DHL and all Group companies. Con-
sequently, liquidity in the Group is centralised as much as possible
in cash pools and managed in the Corporate Center.
e centrally available liquidity reserves (funding avail-
ability), consisting of central short-term nancial investments and
committed credit lines, are the key control parameter. e target is
to have at least  billion available in a central credit line.
e Group had central liquidity reserves of . billion
( previous year: . billion) as at  December , consisting
of central nancial investments amounting to . billion plus a
syndicated credit line of  billion.
Deutsche Post DHL Annual Report 
Consolidated Financial Statements
Notes
Other disclosures
191