Louis Vuitton 2004 Annual Report Download - page 99

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LVMH annual report 2004
95
NOTES TO THE CONSOLIDATED STATEMENTS OF CASH FLOWS
◆
The consolidated statement of cash
flows, as shown opposite, details the
main cash flows in 2004.
◆
The Group’s net cash provided by
operating activities before changes in
current assets and liabilities amounted
to 2,137 million euros in 2004, an
increase of 10% compared with 1,949
million euros a year before.
◆
Working capital requirements
increased by 174 million euros. In par-
ticular, inventory changes generated
cash flow requirements of 239 million
euros, primarily due to the rebuilding of
Louis Vuitton, Hennessy, and Sephora
US inventories. Accounts receivable
were managed rigorously and made a
positive contribution of 38 million euros
to cash flows.
◆
Overall, net cash provided by opera-
ting activities was 1,963 million euros
◆
Net cash used in investing activities,
i.e. capital expenditures and acquisi-
tions less disposals, represented an
outflow of 958 million euros.
◆
The Group’s capital expenditures
totaled 628 million euros. This amount
illustrates the Group’s selective growth
prospects and the focus on the expan-
sion of the store networks, notably at
Louis Vuitton and the opening of the
DFS Galleria in Okinawa.
◆
Financial investments (acquisition of
investments and change in other non-
current assets) totaled 246 million
euros in the year, and the net effect of
acquisitions and disposals of consolida-
ted companies resulted in 244 million
euros. In particular, the purchase and
the installment payments for certain
minority interests in Fendi had a cash
flow impact of 197 million euros, the
purchase of 30 % of Millennium an
impact of 82 million, and the purchase
of a 9 % minority interest in Donna
Karan and of a 10 % minority interest
in BeneFit Cosmetics an impact of 56
million euros. Conversely, the Group
received the proceeds from the disposal
of Ebel.
◆
Disposals of fixed assets (non-finan-
cial assets and unconsolidated invest-
ments) increased cash flow by 160
million euros.
◆
The Group’s purchase of treasury
shares, net of disposals, generated a
cash outflow of 131 million euros
during the year.
◆
Dividends paid in 2004 by LVMH
S.A., excluding treasury shares, totaled
412 million euros, of which 295
million euros related to the final 2003
dividend paid in May and 117 million
euros to the 2004 interim devidend
paid in December. In addition, the
minority shareholders of the consolida-
ted subsidiaries received 109 million
euros in dividends. This was primarily
Diageo for its 34% equity interest in
Moët Hennessy.
◆
After all operating and investment
activities and after payment of divi-
dends, cash surpluses amounted to
354 million euros.
◆
1,687 million euros in borrowings
and financial debt were amortized, an
amount higher than that of new borro-
wings and financial debt.
◆
Bond issues and new borrowings
provided 1,529 million euros. In July,
the Group notably issued a public 7-
year bond for a nominal amount of 600
million euros. In addition, LVMH conti-
nued to broaden its investor base and to
take advantage of opportunities through
private placements issued under its
Euro Medium-Term Notes program, for
an amount of 671 million euro.
◆
Both long- and short-term debt were
reduced, and the outstanding amount
of the commercial paper program
remained almost stable at 2004 year-
end compared with the previous year.
◆
At the close of the operations for
2004, the net cash position stood at
801 million euros.