Structure of the statement of financial position

As of September 30, 2014, the LANXESS Group had total assets of €7,360 million, up €549 million, or 8.1%, from €6,811 million on December 31, 2013. This was mainly attributable to the increase in working capital and to capital expenditures for property, plant and equipment. The equity ratio increased to 32.1%, particularly as a result of the capital increase in the second quarter.

Non-current assets rose by €313 million to €3,905 million, with intangible assets and property, plant and equipment increasing by €234 million to €3,460 million. Cash outflows for purchases of property, plant and equipment and intangible assets in the reporting period were €374 million, below the prior-year level of €398 million. Depreciation and amortization in the first nine months of 2014 totaled €302 million and was thus below the prior-year level despite capital expenditures, mainly because of the lower depreciation and amortization base following impairments of intangible assets and property, plant and equipment at year end 2013. The ratio of non-current assets to total assets was 53.1%, up from 52.7% on December 31, 2013.

Current assets increased by €236 million, or 7.3%, compared with December 31, 2013 to €3,455 million. The inventory growth of €228 million, or 17.6%, to €1,527 million was largely volume-related, slightly intensified by currency effects. Trade receivables were €85 million, or 7.9%, higher at €1,155 million. Cash and cash equivalents decreased by €152 million to €275 million. By contrast, near-cash assets increased by €135 million to €241 million following the acquisition of shares in money market funds. The ratio of current assets to total assets was 46.9%, against 47.3% as of December 31, 2013.

The LANXESS Group has significant internally generated intangible assets that are not reflected in the statement of financial position in light of accounting rules. These include the brand equity of LANXESS and the value of the other brands of the Group. A variety of measures was deployed in the reporting period to continually enhance these assets.

Our established relationships with customers and suppliers also constitute a significant intangible asset. These long-standing, trust-based partnerships with customers and suppliers, underpinned by consistent service quality, enable us to compete successfully even in a more challenging business environment. Our competence in technology and innovation, also a valuable asset, is rooted in our specific knowledge in the areas of research and development and custom manufacturing. It enables us to generate significant added value for our customers.

The know-how and experience of our employees are crucial factors for our corporate success. In addition, we have sophisticated production and business processes that create competitive advantages for us in the relevant markets.

Equity amounted to €2,364 million, up by €464 million or 24.4% compared with December 31, 2013. This increase resulted particularly from the 10% capital increase in the second quarter and from the total comprehensive income in the reporting period. The dividend payment in particular reduced equity. The ratio of equity to the Group’s total assets was 32.1% as of September 30, 2014, against 27.9% as of December 31, 2013.

Non-current liabilities increased by €345 million to €3,374 million as of September 30, 2014. Provisions for pensions and other post-employment benefits rose by €199 million compared with the end of 2013, to €1,142 million. The increase resulted particularly from the change in the interest rates used for measurement. Other non-current financial liabilities amounted to €1,780 million, up by €131 million against December 31, 2013. This increase resulted primarily from the partial refinancing of the €500 million Eurobond issued in 2009 that matured in the reporting period. The ratio of non-current liabilities to total assets was 45.9%, up from 44.5% as of December 31, 2013. 

Current liabilities came to €1,622 million, down by €260 million or 13.8% from December 31, 2013. This decline resulted mainly from the repayment of the aforementioned Eurobond issued in 2009. Trade payables, at €688 million, were level with the end of 2013. Other current provisions increased by €75 million to €430 million. The ratio of current liabilities to total assets was 22.0% as of September 30, 2014, against 27.6% at the end of 2013.