Engineering

2.4 Management report on the Group Financial position
Analysis of the statement of cash flows
The overall amounts taken into account in the statement of cash flows correspond to the item “Cash and
cash equivalents” as reported in the statement of financial position, taking into account the cash and cash
equivalents relating to the disposal groups including the discontinued operations. For the reporting period
and the prior year, the discontinued operations comprise the activities of the Stainless Global business area.
In fiscal year 2010/2011 there was an overall cash inflow from operating activities of €776 million,
compared with €868 million in the prior year. The cash inflow of the continuing operations was level with the
prior year at €1,012 million. A €413 million improvement in other assets/liabilities not related to investing or
financing activities was partly offset by a net €346 million increase in funds tied up in inventories and trade
receivables and payables. In the discontinued operations, the overall higher funds tied up in operating
assets/liabilities in particular resulted in a €73 million reduction in operating cash flows to €(236) million.
The overall cash outflow from investing activities was €612 million lower than a year earlier at
€2,347 million. The €539 million reduction in the continuing operations was the result in particular of two
offsetting effects: Capital expenditure for property, plant and equipment and intangible assets decreased by
€670 million; this was partly offset by the €205 million reduction in proceeds from the disposal of
consolidated companies. The discontinued operations reported a €73 million decrease in cash outflow from
investing activities, mainly due to lower investment in property, plant and equipment.
As in the prior year, the free cash flow of the continuing operations, i.e. the sum of operating cash flows and
cash flows from investing activities, was negative. Compared with a year earlier, however, the negative free
cash flow was €520 million lower at €(1,070) million. The free cash flow attributable to the discontinued
operations was unchanged from the prior year. Overall, the negative free cash flow was €520 million lower
than a year earlier at €(1,571) million.
The cash inflow from financing activities attributable to the continuing operations improved year-on-year by
€1,234 million to €989 million. The increase was mainly due to the sale of treasury shares in July 2011
(€1,624 million) and a reduced cash outflow in connection with the financing of discontinued operations
(€514 million). This was partly offset firstly by the €465 million decrease in proceeds to equity from noncontrolling
interest; in the prior year, proceeds of €500 million were reported in connection with the increase
in Vale S.A.’s shareholding in ThyssenKrupp CSA. Secondly there was a €301 million increase in
repayments of financial debt; this included the €750 million repayment of a bond in fiscal year 2010/2011.
Including the €37 million increase in cash inflow from financing activities to €538 million that was
attributable to the discontinued operations and related in particular to the inclusion of the Stainless Global
business area in the Group financing system, overall cash inflow from financing activities increased by
€1,271 million to €1,527 million.
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