Philips 2012 Annual Report Download - page 46

5 Group performance 5.1.22 - 5.1.23
46 Annual Report 2012
to the delivery of treasury shares and a EUR 84 million
increase in share premium due to share-based
compensation plans.
Shareholders’ equity decreased by EUR 2,691 million in
2011 to EUR 12,316 million at December 31, 2011. The
decrease was mainly as a result of a EUR 1,291 million net
loss and EUR 447 million losses related to pension plans,
as well as EUR 751 million related to the purchase of
treasury shares. The dividend payment to shareholders in
2011 reduced equity by EUR 263 million. The decrease
was partially offset by a EUR 46 million increase related
to the delivery of treasury shares and a EUR 56 million
increase in share premium due to share-based
compensation plans.
The number of outstanding common shares of Royal
Philips Electronics at December 31, 2012 was 915 million
(2011: 926 million).
At the end of 2012, the Company held 28.7 million shares
in treasury to cover the future delivery of shares (2011:
33.6 million shares). This was in connection with the 52.3
million rights outstanding at the end of 2012 (2011: 47.1
million rights) under the Company’s long-term incentive
plan and convertible personnel debentures. At the end of
2012, the Company held 13.8 million shares for
cancellation (2011: 49.3 million shares).
5.1.22 Liquidity position
Including the Company’s net debt (cash) position (cash
and cash equivalents, net of debt), listed available-for-
sale financial assets, as well as its EUR 1.8 billion
committed revolving credit facility, the Company had
access to net available liquid resources of EUR 1,220
million as of December 31, 2012, compared to EUR 2,597
million one year earlier.
Liquidity position
in millions of euros
2010 2011 2012
Cash and cash equivalents 5,833 3,147 3,834
Committed revolving credit facility/
CP program/Bilateral loan 2,000 3,200 1,800
Liquidity 7,833 6,347 5,634
Available-for-sale financial assets at
fair value 270 110 120
Short-term debt (1,840) (582) (809)
Long-term debt (2,818) (3,278) (3,725)
Net available liquidity resources 3,445 2,597 1,220
The fair value of the Company’s available-for-sale financial
assets amounted to EUR 120 million.
Philips has a EUR 1.8 billion committed revolving credit
facility that can be used for general corporate purposes
and as a backstop of its commercial paper program. In
January 2013, the EUR 1.8 billion facility was extended by
2 years until February 18, 2018. The commercial paper
program amounts to USD 2.5 billion, under which Philips
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. As at December 31, 2012,
Philips did not have any loans outstanding under these
facilities.
Philips’ existing long-term debt is rated A3 (with negative
outlook) by Moody’s and A- (with negative outlook) by
Standard & Poor’s. It is Philips’ objective to manage its
financial ratios to be in line with an A3/A- rating. There is
no assurance that Philips will be able to achieve this goal.
Ratings are subject to change at any time. Outstanding
long-term bonds and credit facilities do not have a
repetitive material adverse change clause, financial
covenants or credit-rating-related acceleration
possibilities.
As at December 31, 2012, Philips had total cash and cash
equivalents of EUR 3,834 million. Philips pools cash from
subsidiaries to the extent legally and economically feasible.
Cash not pooled remains available for local operational or
investment needs. Philips had a total gross debt position
of EUR 4,534 million at year-end 2012.
Philips believes its current working capital is sufficient to
meet our present working capital requirements.
5.1.23 Cash obligations
Contractual cash obligations
Presented below is a summary of the Group’s contractual
cash obligations and commitments at December 31, 2012.