Philips 2009 Annual Report Download - page 71

purchase programs, reducing equity by EUR 3,298 million.
The dividend payment to shareholders in 2008 further
reduced equity by EUR 720 million. Additionally a EUR
2,302 million decrease related to total changes in
comprehensive income, net of tax. The decrease was
partially offset by EUR 123 million related to re-issuance
of treasury stock and net share-based compensation
plans.
The number of outstanding common shares of Royal
Philips Electronics at December 31, 2009 was 927 million
(2008: 923 million).
At the end of 2009, the Company held 43.1 million shares
in treasury to cover the future delivery of shares (2008:
47.6 million shares). This was in connection with the 62.1
million rights outstanding at the end of 2009 (2008: 65.5
million rights) under the Company’s long-term incentive
plan and convertible personnel debentures. At the end of
2009, the Company held 1.9 million shares for
cancellation (2008: 1.9 million shares).
4.2.8 Liquidity position
Including the Company’s net debt (cash) position (cash
and cash equivalents, net of debt), listed available for-sale
financial assets, listed equity-accounted investees, as well
as its USD 2.5 billion commercial paper program
supported by the revolving credit facility, and EUR 200
million committed undrawn bilateral loan, the Company
had access to net available liquidity resources of EUR
2,412 million as of December 31, 2009, compared to EUR
2,365 million one year earlier.
Liquidity position
in millions of euros
2007 2008 2009
Cash and cash equivalents 8,769 3,620 4,386
Committed revolving credit facility/
CP program 1,698 2,274 1,936
Liquidity 10,467 5,894 6,322
Available-for-sale financial assets at
market value 1,776 599 244
Main listed investments in equity-
accounted investees at market value 2,688 60 113
Short-term debt (2,350) (722) (627)
Long-term debt (1,213) (3,466) (3,640)
Net available liquidity resources 11,368 2,365 2,412
The fair value of the Company’s listed available-for-sale
financial assets, based on quoted market prices at
December 31, 2009, amounted to EUR 244 million. The
sale of remaining LG Display and Pace Micro Technology
shares contributed the majority of the decrease in
available-for-sale financial assets.
Philips’ shareholdings in its main listed equity-accounted
investees had a fair value of EUR 113 million based on
quoted market prices at December 31, 2009, and
consisted primarily of the Company’s holdings in TPV
Technology.
Philips has a USD 2.5 billion commercial paper program,
under which it can issue commercial paper up to 364 days
in tenor, both in the US and in Europe, in any major freely
convertible currency. There is a panel of banks, in Europe
and in the US, which service the program. The interest is
at market rates prevailing at the time of issuance of the
commercial paper. There is no collateral requirement in
the commercial paper program. Also, there are no
limitations on Philips’ use of the program.
Philips also has USD 2.5 billion committed revolving credit
facilities that could act as back-up for short-term financing
requirements that normally would be satisfied through
the commercial paper program. As of December 31,
2009, Philips did not have any commercial paper
outstanding nor did Philips draw under the revolving
credit facilities.
In addition to the USD 2.5 billion revolving credit facilities,
Philips had a new EUR 200 million committed undrawn
bilateral loan in place as of October 30, 2009. As of
December 31, 2009, Philips did not have any loans
outstanding under these facilities.
Outstanding long-term bonds do not have a material
adverse change clause, financial covenants or credit-
rating-related acceleration possibilities.
As at December 31, 2009, Philips had total cash and cash
equivalents of EUR 4,386 million; Philips pools cash from
subsidiaries to the extent legally and economically feasible.
Cash in subsidiaries is not necessarily freely available for
alternative uses due to possible legal or economic
restrictions. The amount of cash not immediately available
is not considered material for Philips to meet its cash
obligations. Philips had a total debt position of EUR 4,267
million at year-end 2009.
Philips’ existing long-term debt is rated A3 (with negative
outlook) by Moody’s and A- (with stable outlook) by
Standard & Poor’s. It is our objective to manage our
financial ratios to be in line with A3/A-. There is no
assurance that we will be able to achieve this goal. Ratings
are subject to change at any time.
On February 18, 2010 Philips signed a new 5-year EUR 1.8
billion revolving credit facility to replace the existing USD
2.5 billion facility.
4 Our group performance 4.2.7 - 4.2.9
Philips Annual Report 2009 71