Siemens 2007 Annual Report Download - page 146

146 Management’s discussion and analysis
Operating activities provided net cash of €7.328 billion in fi scal 2007, com-
pared to €5.659 billion in fi scal 2006. These results include both continuing opera-
tions and discontinued operations. Within the total, continuing operations pro-
vided net cash of €9.822 billion, up from €5.003 billion a year earlier. Discontinued
operations used net cash of €2.494 billion in the current period, including a build-
up of net working capital, particularly receivables as well as €640 million tax pay-
ments related to the carve-out of SV. A year earlier, discontinued operations pro-
vided net cash of €656 million.
Investing activities used net cash of €11.357 billion in fi scal 2007, a substan-
tial increase from €4.696 billion in the prior-year period. Within these results,
continuing operations were the primary factor in the change year-over-year,
using net cash of €10.068 billion compared to net cash used of €4.315 billion in the
same period a year earlier. Discontinued operations used net cash of €1.289 billion
compared to net cash used of €381 million in the prior-year period, which bene-
fi ted from €465 million in proceeds from the sale of our shares in Juniper Net-
works, Inc (Juniper).
Operating activities provided net cash within continuing Operations of
€6.407 billion in fi scal 2007, substantially up from €3.405 billion the year before.
This increase was driven by a signifi cant higher income from continuing opera-
tions year-over-year as well as by a substantial improvement in net working capi-
tal compared to the prior-year period. Accordingly, cash outfl ows relating to net
inventories improved especially at I&S and SBT and current liabilities increased
primarily due to advanced payments at PG. The current period also includes pay-
ments of €431 million relating to the antitrust investigation involving suppliers of
high-voltage gas-isolated switching systems mentioned earlier, while the prior
period included substantially higher cash outfl ows related to severance payments
at SIS. Within Financing and Real Estate and Corporate Treasury, the change year-
over-year in net cash provided by operating activities from continuing operations
was due primarily to accounts receivable related to the carve-outs of SV and the
carrier activities transferred into NSN. For Siemens overall, net cash provided by
operating activities on a continuing basis amounted to €9.822 billion in fi scal
2007 compared to €5.003 billion in fi scal 2006.
Continuing operations Operations
SFS, SRE and
Corporate Treasury* Siemens
Year ended September 30,
(€ in millions) 2007 2006 2007 2006 2007 2006
Net cash provided by
(used in):
Operating activities A 6,407 3,405 3,415 1,598 9,822 5,003
Investing activities (9,262) (2,995) (806) (1,320) (10,068) (4,315)
Herein: Additions to
intangible assets and
property, plant and
equipment B (2,313) (2,415) (754) (768) (3,067) (3,183)
Free cash fl ow A+B 4,094 990 2,661 830 6,755 1,820
* Also includes eliminations and reclassifi cations.