Philips 2007 Annual Report Download - page 43

Philips Annual Report 2007 49
Additionally, EUR 1,640 million cash was generated from
the sale of interests in businesses, including the sale of
46.4 million shares in LG.Philips LCD, resulting in a cash
inow of EUR 1,547 million, as well as the divestments
of the remaining parts of Optical Storage and Mobile
Phones. Furthermore, a net amount of EUR 385 million
cash was generated from maturing currency hedges.
During 2007, a total of EUR 1,502 million was utilized
for acquisitions, notably PLI (EUR 561 million) and Color
Kinetics (EUR 515 million), as well as DLO, Health
Watch and Raytel Cardiac Services.
In 2006, a total of EUR 2,498 million was used for
acquisitions, notably Intermagnetics (EUR 993 million),
Avent (EUR 689 million), Lifeline (EUR 583 million) and
Witt Biomedical (EUR 110 million). The divestment of
businesses, primarily within Innovation & Emerging
Businesses, generated EUR 384 million cash.
Cash flows from acquisitions, divestments and derivatives
in millions of euros
divestments and derivatives acquisitions
8,000
6,000
4,000
2,000
0
(2,000)
(4,000)
1,801
1,424
20031)
2,318
(371)
1,947
20041)
3,346
(1,153)
2,193
20051) 20061)
6,130
(1,502)
4,628
2007
(2,498)
(2,114)
384
(377)
1) Restated to present the MedQuist business as a discontinued operation
Cash ow from discontinued operations
In 2007, EUR 115 million cash was used by discontinued
operations, the majority of which related to tax
payments in connection with the 2006 sale of Philips’
majority stake in the Semiconductors business and
operating cash ows of MedQuist in 2007.
In 2006, discontinued operations generated cash ows
of EUR 7,114 million, predominantly related to the sale
of a majority stake in the Semiconductors division, which
generated EUR 7,059 million.
Cash ows from nancing activities
Net cash used for nancing activities in 2007 was
EUR 2,368 million. The impact of changes in debt
was a reduction of EUR 281 million, including a EUR
113 million repayment of long-term bank borrowings.
Philips’ shareholders were paid EUR 659 million in
dividend. Additionally, cash outows for share repurchase
totaled EUR 1,609 million. This included EUR 810 million
related to hedging of obligations under the long-term
employee incentive and employee stock purchase programs,
and a total of EUR 823 million related to the repurchases
of the shares for cancellation, offset by EUR 24 million
representing dividend tax credit facility. Partially offsetting
these cash outows was a net cash inow of EUR 161
million due to the exercise of stock options.
Net cash used for nancing activities in 2006 was
EUR 3,715 million. The impact of changes in debt was
a reduction of EUR 437 million, including a EUR 208
million scheduled bond repayment. Philips’ shareholders
were paid EUR 523 million in dividend. Additionally, cash
outows for share repurchase totaled EUR 2,899 million.
This included EUR 414 million nal repurchases related
to the EUR 1.5 billion share repurchase program
announced in August 2005 that was completed in
February 2006, a total of EUR 118 million related to
98 Risk management 112 Our leadership 116 Report of the Supervisory Board 126 Financial Statements