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33. Net cash provided by (used in) operating activities

The gross cash flow for 2008 of €5,295 million (2007: €4,784 million) is the cash surplus from operating activities before any changes in working capital. The cash flows by segment are shown in the table in Note [1].

The net operating cash flow from continuing operations of €3,608 million (2007: €4,281 million) takes into account the changes in working capital and other non cash-relevant transactions. The €2 million net cash flow from discontinued operations in 2007 comprised operating cash flows from the H. C. Starck and Wolff Walsrode business units and the diagnostics business. The total net cash flow for 2008 was €3,608 million (2007: €4,283 million).

The line “Non-cash effects of the remeasurement of acquired assets (inventory work-down)” has been inserted in the cash flow statement in order to eliminate the effects of the Schering purchase price allocation from gross cash flow. Thus, the non-cash effect of the work-down of the step-up from the remeasurement of Schering inventories to fair value as of June 23, 2006, the date of acquisition, on the gross cash flow is reversed. In 2008, €208 million (2007: €215 million) was transferred to this line from “Decrease/Increase in inventories.”

Income-tax-related cash flows of €1,073 million are reflected in the net cash flow for 2008 (2007: €1,151 million). The changes in income tax liabilities, income tax provisions and claims for reimbursement of income taxes are shown in the line “Changes in other working capital, other non-cash items.”

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