Page 180 - 2012 Annual Report

180 VIVENDI l 2012 l Annual Report
FINANCIAL REPORT – CONSOLIDATED FINANCIAL STATEMENTS – STATUTORY AUDITORS’ REPORT ON THE
CONSOLIDATED FINANCIAL STATEMENTS – STATUTORY AUDITORS’ REPORT ON THE FINANCIAL STATEMENTS –
STATUTORY FINANCIAL STATEMENTS 4
4
I - 2012 FINANCIAL REPORT
SECTION 3 CASH FLOW FROM OPERATIONS ANALYSIS
SECTION 3 CASH FLOW FROM OPERATIONS ANALYSIS
Preliminary comment:
Vivendi considers that the non-GAAP measures cash flow from operations (CFFO), cash flow from operations before capital expenditures (CFFO before
capex, net) and cash flow from operations after interest and taxes (CFAIT) are relevant indicators of the group’s operating and financial performance.
These indicators should be considered in addition to, and not as substitutes for, other GAAP measures as reported in Vivendi’s cash flow statement,
contained in the group’s Consolidated Financial Statements.
In 2012, cash flow from operations before capital expenditures (CFFO
before capex, net) generated by business segments amounted to
€7,872 million (compared to €8,034 million in 2011), a €162 million
decrease (-2.0%). This change included the increase in EBITDA after
changes in the group’s net working capital (+€277 million), notably
thanks to the good performances of Activision Blizzard (+€338 million),
Canal+ Group (+€108 million), and Maroc Telecom (+€94 million), despite
the decline in the performance of SFR (-€407 million). Moreover, it also
reflected the increase in content investments (-€286 million), restructuring
charges (-€75 million, primarily the impact of the voluntary redundancy
plan at Maroc Telecom), as well as the impact of the dividend received in
January 2011, as part of the completion of the sale of Vivendi’s interest in
NBC Universal (-€70 million).
In 2012, capital expenditures, net amounted to €4,490 million (compared
to €3,340 million in 2011), a €1,150 million increase. This change included
SFR’s acquisition of 4G mobile spectrum for €1,065 million in January 2012
and €150 million in October 2011. Excluding the acquisition of mobile
spectrum in 2012 and 2011, capital expenditures, net increased by
€235 million (+7.4%), primarily attributable to the geographical expansion
of GVT’s telecommunication network and to the development of its pay-TV
business (+€242 million).
After capital expenditures, net, cash flow from operations (CFFO)
generated by business segments amounted to €3,382 million (compared
to €4,694 million in 2011), a €1,312 million decrease. Excluding the
acquisition of mobile spectrum in 2012 and 2011, CFFO generated
by business segments amounted to €4,447 million (compared to
€4,844 million in 2011), a €397 million decrease (-8.2%), primarily
reflecting the decline in SFR’s performance.
In 2012, cash flow from operations after interest and income taxes paid
(CFAIT) amounted to €1,954 million (compared to €2,884 million in 2011),
a €930 million decrease (-32.2%). The decrease in CFFO (-€1,312 million)
and the increase in interest expense (-€87 million) were partially offset
by the €141 million decrease in cash payments of other items related to
financial activities and by the €328 million decrease in income taxes paid,
net. The change in income taxes paid, net mainly reflected the change
from one fiscal year to another of the amount of income tax installments
for the current fiscal year and final settlements for the previous fiscal year
paid by the group’s entities in the course of the given year.
Cash payments of other items related to financial activities notably
included the net premium paid in connection with borrowings issued
and the early unwinding of interest rate hedging derivative instruments
(-€74 million) and the settlement of the past disputes between GVT and
various Brazilian States regarding the application of the ICMS tax on
Internet and Broadband services (€7 million paid in 2012, compared to
€164 million paid in 2011). In addition, hedging currency risk transactions
generated a net cash outflow of €52 million in 2012 (including a €78 million
foreign exchange loss attributable to the redemption in April 2012 of a
$700 million bond), compared to an €8 million net cash inflow in 2011.