Nokia 2007 Annual Report Download - page 85

availableforsale investments, liquid assets of EUR 4 798 million, compared with EUR 3 219 million in
2006 and EUR 7 277 million in 2005. Net cash from acquisitions of group companies due to acquired
cash in an otherwise noncash transaction was EUR 253 million in 2007 compared with EUR 517 million
net cash used in acquisitions of Group companies in 2006 and EUR 92 million in 2005. Additions to
capitalized R&D expenses totaled EUR 157 million, representing an increase compared with
EUR 127 million in 2006 and EUR 153 million in 2005. Longterm loans made to customers increased
to EUR 261 million in 2007, compared with EUR 11 million in 2006 and EUR 56 million in 2005. Net
cash from investing activities in 2006 included EUR 276 million relating recovery of impaired long
term loans made to customers. Capital expenditures for 2007 were EUR 715 million compared with
EUR 650 million in 2006 and EUR 607 million in 2005. Major items of capital expenditure included
production lines, test equipment and computer hardware used primarily in research and
development, office and manufacturing facilities as well as services and software related intangible
assets. Proceeds from maturities and sale of current availableforsale investments, liquid assets,
decreased to EUR 4 930 million, compared with EUR 5 058 million in 2006, and EUR 9 402 million in
2005.
Net cash used in financing activities decreased to EUR 3 832 million in 2007 compared with
EUR 4 966 million in 2006, primarily as a result of increase in proceeds from stock options exercises of
EUR 941 million and in proceeds from shortterm borrowings of EUR 798 million offset by an increase
in the purchases of treasury shares with EUR 448 million during 2007. Net cash used in financing
activities decreased to EUR 4 966 million in 2006 compared with EUR 5 570 million in 2005, primarily
as a result of a decrease in the purchases of treasury shares with EUR 887 million during 2006.
Dividends paid increased to EUR 1 760 million in 2007 compared with EUR 1 553 million in 2006 and
EUR 1 531 million in 2005.
At December 31, 2007, we had EUR 203 million in longterm interestbearing liabilities and
EUR 1 071 million in shortterm borrowings, offset by EUR 11 753 million in cash and other liquid
assets, resulting in a net liquid assets balance of EUR 10 479 million, compared with EUR 8 221 million
at the end of 2006. For further information regarding our longterm liabilities, see Note 23 to our
consolidated financial statements included in Item 18 of this annual report. Our ratio of net
interestbearing debt, defined as shortterm and longterm debt less cash and other liquid assets, to
equity, defined as shareholders’ equity and minority interests, was negative 61%, negative 68% and
negative 77% at December 31, 2007, 2006 and 2005, respectively.
Our Board of Directors has proposed a dividend of EUR 0.53 per share for the year ended December 31,
2007, subject to shareholders’ approval, compared with EUR 0.43 and EUR 0.37 per share paid for the
years ended December 31, 2006 and 2005, respectively. See “Item 3.A Selected Financial Data—
Distribution of Earnings.”
We have no potentially significant refinancing requirements in 2008. We expect to incur additional
indebtedness from time to time as required to finance acquisitions and working capital needs. We
plan to finance the pending acquisition of NAVTEQ with a combination of cash and debt. At
December 31, 2007, Nokia had a USD 500 million US Commercial Paper, or USCP, program, a
USD 500 million Euro Commercial Paper, or ECP, program and a EUR 3 000 million Euro Medium Term
Note, or EMTN program. In addition, at the same date, we had a Finnish local commercial paper
program totaling EUR 750 million. At December 31, 2007, we also had committed credit facilities of
USD 2 000 million maturing in 2008, EUR 500 million maturing in 2011, USD 2 000 million maturing
in 2012, and a number of shortterm uncommitted facilities.
We have historically maintained a high level of liquid assets. Management estimates that the cash and
other liquid assets level of EUR 11 753 million at the end of 2007, together with our available credit
facilities, cash flow from operations, funds available from longterm and shortterm debt financings, as
well as the proceeds of future equity or convertible bond offerings, will be sufficient to satisfy our
future working capital needs, capital expenditure, research and development, acquisitions and debt
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