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Liquidity analysis

In addition to cash of €386 million and investments in highly liquid AAA money market funds of €411 million, LANXESS has additional sizeable liquidity reserves in the form of undrawn credit facilities. The investments in money market funds are undertaken only at European Group companies that are not subject to restrictions on foreign exchange and capital transfers. We can therefore freely dispose of the funds. Around 93% of our cash is held in Group companies in countries with no restrictions on foreign exchange and capital transfers. Only about 7% of our cash is held in companies in regulated capital markets where cash transfers are restricted.

Thanks to our strong liquidity position, our solvency was assured at all times in fiscal 2012.

By far the most important of our credit lines is the syndicated credit facility of €1.25 billion that is valid until February 2018 and has two one-year extension options. This facility was largely undrawn at the end of 2012. It is designed as an operating line of credit and to provide funds for capital investment. It corresponds to market requirements in the European syndicated loan market for investment-grade companies with a BBB rating. Another important credit line is the €200 million facility we have with the European Investment Bank. None of our major loan agreements contains a financial covenant. LANXESS had unused credit lines totaling around €1.5 billion as of December 31, 2012, against €1.8 billion at the end of the previous year.

The total of liquid assets and undrawn credit lines gives us a liquidity scope of around €2.3 billion, which is the same as the prior year. Given the ongoing volatility of the capital markets and in view of our growth targets, this liquidity reserve is an expression of our forward-looking and conservative financial policy. Our solvency is safeguarded for the short and long term.



Key Figure Analyser