NOTE B12 CFROI - 2017 Annual Integrated Report

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In € million

FY 2017

FY 2016⁽¹⁾

As published

Adjustment

As calculated

As published

Adjustment

As calculated

(1)	Reference figures are provided on a non-restated basis.
(2)	Excluding discontinued operations.
(3)	Currently estimated at 2% of replacement value of fixed assets.
(4)	Currently estimated at 30% of underlying EBIT.
(5)	The adjustment reflects the quarterly average over the year.
(6)	The adjustment reflects the difference between the estimated replacement value of goodwill and fixed assets, and the accounting value. The changes over time come from foreign exchange variations, new investments and portfolio moves.

Underlying EBIT

1,527

1,534

Underlying EBITDA

2,230

2,284

Earnings from associates & joint ventures

Dividends received from associates & joint ventures⁽²⁾

–

Recurring capex⁽³⁾

e = -2%*l

(326)

(363)

Recurring income taxes⁽⁴⁾

f = -30%*(a-c)

(437)

(439)

Recurring "CFROI" cash flow data

g = b-c+d+e+f

1,415

1,434

Tangible assets

5,433

6,472

Intangible assets

2,940

3,600

Goodwill

5,042

5,679

Replacement value of goodwill & fixed assets⁽⁵⁾⁽⁶⁾

k = h+i+j

13,415

5,093

18,508

15,751

4,669

20,420

of which fixed assets

16,314

18,134

Investments in associates & joint ventures⁽⁵⁾

466

482

497

(52)

445

Net working capital⁽⁵⁾

1,414

111

1,525

1,396

355

1,751

CFROI invested capital

o = k+m+n

20,515

22,615

CFROI

p = g/o

6.9%

6.3%

CFROI rose to 6.9%, the same level as prior to the Cytec acquisition, and is now in the value-creation zone. The 0.6 percentage point increase on the figure of 6.3% on a non-restated basis in 2016 reflected both volume growth and maintained capital discipline.