Bayer AG - Stockholders' Newsletter Second Quarter 2007 - Bayer Group Consolidated Statements of Cash Flows

3 of 8

Financial Statements

Bayer Group Consolidated Statements of Cash Flows

	2nd Quarter 2006	2nd Quarter 2007	1st Half 2006	1st Half 2007
€ million
Income from continuing operations after taxes	451	413	1,013	1,069
Income taxes	198	247	475	548
Non-operating result	228	257	438	475
Income taxes paid	(284)	(342)	(500)	(685)
Depreciation and amortization	392	655	779	1,254
Change in pension provisions	(50)	(86)	(180)	(182)
(Gains) losses on retirements of noncurrent assets	(7)	(6)	(8)	6
Non-cash effects of the remeasurement of acquired assets (inventory work-down)	-	49	-	113
Gross cash flow	928	1,187	2,017	2,598

Decrease (increase) in inventories	11	38	(103)	(175)
Decrease (increase) in trade accounts receivable	25	(52)	(864)	(1,063)
(Decrease) increase in trade accounts payable	(40)	16	(271)	(98)
Changes in other working capital, other non-cash items	(42)	(373)	141	(71)
Net cash provided by (used in) operating activities (net cash flow), continuing operations	882	816	920	1,191
Net cash provided by (used in) operating activities (net cash flow), discontinued operations	120	(36)	210	2
Net cash provided by (used in) operating activities (net cash flow) (total)	1,002	780	1,130	1,193

Cash outflows for property, plant, equipment and intangible assets	(340)	(440)	(759)	(641)
Cash inflows from sales of property, plant, equipment and other assets	24	13	44	31
Cash inflows from divestitures less divested cash	39	230	39	4,903
Cash outflows for acquisitions less acquired cash	(14,110)	(235)	(14,130)	(257)
Cash inflows from noncurrent financial assets	43	3	69	8
Interest and dividends received	375	376	482	469
Cash inflows/outflows from current financial assets	133	0	227	23
Net cash provided by (used in) investing activities (total)	(13,836)	(53)	(14,028)	4,536

Bayer AG dividend, dividend payments to minority stockholders, reimbursements of advance capital gains tax payments	(692)	(766)	(527)	(775)
Issuances of debt	13,493	1,159	13,762	1,603
Retirements of debt	(20)	(3,542)	(413)	(5,496)
Interest paid	(461)	(740)	(689)	(985)
Net cash provided by (used in) financing activities (total)	12,320	(3,889)	12,133	(5,653)

Change in cash and cash equivalents due to business activities (total)	(514)	(3,162)	(765)	76

Cash and cash equivalents at beginning of period	3,026	6,143	3,290	2,915

Change in cash and cash equivalents due to changes in scope of consolidation	0	(3)	(2)	(4)
Change in cash and cash equivalents due to exchange rate movements	(21)	2	(32)	(7)

Cash and cash equivalents at end of period	2,491	2,980	2,491	2,980