42. Notes to the cash flow statement

In accordance with IAS 7 (Statement of Cash Flow), the consolidated cash flow statement describes changes in the group’s cash and cash equivalents through cash inflows and outflows during the reporting period.

The item cash and cash equivalents includes cheques and cash on hand as well as cash in transit and bank deposits with a remaining term of up to three months.

The cash flow statement distinguishes between changes in cash levels from operating, investing and financing activities. Cash flows from discontinued operations are shown separately where they concern discontinued business operations.

Cash flows from discontinued operations relate to the sale of the Galeria Kaufhof group.

During the reporting period, net cash provided by operating activities amounted to €1,595 million (2013/14: €1,754 million). Impairment losses concern property, plant and equipment at €888 million (2013/14: €948 million), goodwill at €457 million (2013/14: €88 million), other intangible assets at €104 million (2013/14: €110 million) and investment properties at €38 million (2013/14: €16 million). On the other hand, reversals of impairment losses amount to €22 million (2013/14: €11 million).

The change in net working capital amounts to €–305 million (2013/14: €3 million) and includes changes in inventories, trade receivables and receivables due from suppliers included in the item other financial and non-financial assets, credit card receivables and prepayments made on inventories. In addition, the item includes changes in trade liabilities and liabilities to customers, deferred sales related to vouchers, customer loyalty programmes, provisions for customer loyalty programmes and rights of return as well as prepayments made on orders.

Other operating activities resulted in a total cash inflow of €381 million (2013/14: cash outflow of €12 million). This item includes changes in other assets and liabilities as well as deferred income and prepaid expenses. In addition, it includes changes in the assets and liabilities held for sale, adjustments of unrealised currency effects and the elimination of deconsolidation results recognised in EBIT.

The change compared with the previous year is essentially due to adjustments of unrealised currency effects in the amount of €170 million and other taxes in the amount of €145 million.

Investing activities led to a cash inflow of €1,187 million (2013/14: cash outflow of €593 million). This includes payments for the acquisition of the Classic Fine Foods group in the amount of €241 million and additional shares in the iBOOD group in the amount of €10 million. Cash inflows from divestments essentially result from the sale of the wholesale business in Greece. In the previous year, cash flow from investing activities included payments related to the sale of Real’s Eastern European business of €89 million. Cash inflows of €1,981 million related to the sale of the Galeria Kaufhof group are shown in cash flow from investing activities of discontinued operations and comprise the purchase price of €2,362 million net of cash and cash equivalents disposed of in the amount of €381 million.

Other investments include cash outflows in the amount of €415 million for short-term financial investments > 3 months as well as €82 million for a joint venture with Carlton Investment and for various investments in the amount of €6 million.

The amount of investments in property, plant and equipment shown as cash outflows differs from the inflows shown in the asset statement in the amount of non-cash transactions. These essentially concern additions from finance leases, currency effects and changes in liabilities from the acquisition of miscellaneous other assets.

During the reporting period, the cash outflow from financing activities totalled €718 million (2013/14: cash outflow of €1,352 million).

As in the previous year, there were no restrictions on titles for cash and cash equivalents.