Annual Report 2011

60 Financial Commentary
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assets, of which CHF 6.8 million was spent on
upgrading European plants and on expanding and
integrating IT platforms and CHF 3.4 million was
spent on expanding capacity by building a new
factory in Bangalore, India.
Free cash flow, defined as operating cash flow
minus capital expenditure, amounted to CHF 9.3
million or 2.6 % of sales revenues (previous year
CHF 28.0 million or 14.0 %). The decline is attributed
to the greater amount of capital tied up in
inventory and the capacity expansion in India.
The acquisition of the Dörries Scharmann Group
for a cash consideration of CHF 85.7 million
resulted in a net cash outflow of CHF 60.0 million
after taking into account the CHF 25.7 million in
cash and cash equivalents acquired through this
transaction. The acquisition of Dörries Scharmann
Group was refinanced by means of a capital increase
conducted in May 2011. Including the sale
of treasury shares and transaction costs of
CHF 1.6 million (2.4 % of transaction volume), the
net proceeds of the capital increase amounted to
CHF 67.0 million.
Based on the net profit reported for 2010, a with-
holding-tax-free distribution from capital contribution
reserves in the amount of CHF 2.5 million
was paid in April 2011, which corresponded to a
payout ratio of 31 %.