The Bertelsmann consolidated cash flow statement has been prepared in accordance with IAS 7 and is used to evaluate the Group’s ability to generate cash and cash equivalents. Cash flows are divided into those relating to operating activities, investing activities and financing activities. Cash flows from operating activities are presented using the indirect method, with Group earnings before interest and taxes adjusted for non-cash items. Income and expenses relating to cash flows from investing activities are also eliminated.
The management of Group operations of the Bertelsmann Group utilizes indicators that include operating EBITDA and is thus before interest and taxes as well as depreciation, amortization and impairment and special items. Operating results and the resulting cash flow from operating activities should therefore be consistent and comparable. Accordingly, the net balance of interest paid and interest received during the financial year is shown in the cash flow statement as part of financing activities.
Contributions to pension plans are a cash outflow reported as a separate item in the cash flow from investing activities. In the reporting period, a voluntary contribution to plan assets managed by Bertelsmann Pension Trust e. V. was made in the amount of €650 million. The change in provisions for pensions and similar obligations represents the balance of personal expenses for pensions and similar obligations and company payments for these obligations (further explanations are presented in note 19 “Provisions for Pensions and Similar Obligations”).
The consolidated cash flow statement includes the effects of changes in foreign currencies and changes in the scope of consolidation. Items in the consolidated cash flow statement thus cannot be compared with changes in items disclosed on the consolidated balance sheet. Investing activities include payments for fixed assets and purchase price payments for consolidated investments acquired as well as proceeds from the disposal of non-current assets and participations. Further explanations concerning acquisitions made during the financial year are presented in the “Acquisitions and Disposals” section. Disposals during the financial year are also presented separately in that section. Investments in financial assets include, among others, a purchase price payment in the amount of €134 million for the acquired interest in the online education platform HotChalk and a purchase price payment in the amount of €69 million for the acquisition of interest in the online learning provider Udacity. Financial debt of €41 million (previous year: €62 million) was assumed during the financial year.
Cash flow from financing activities includes changes in equity, financial debt and dividend payments affecting cash, as well as interest paid and interest received. The item “Proceeds from bonds and promissory notes” mainly includes payments received from two subordinated hybrid bonds totaling a volume of €1,250 million. The item “Proceeds from/redemption of other financial debt” includes receipts in the amount of €222 million (previous year: €126 million) and payments in the amount of €-377 million (previous year: €-207 million).