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Structure of the statement of financial position

As of March 31, 2013, the LANXESS Group had total assets of €7,603 million, up €84 million, or 1.1%, from €7,519 million on December 31, 2012. The main reasons for the increase were the higher levels of net working capital and of property, plant and equipment. These were partly offset by a decrease in liquid assets.

Non-current assets rose by €102 million to €3,849 million. The intangible assets and property, plant and equipment included in that figure increased by €99 million to €3,483 million. Cash outflows for purchases of property, plant, equipment and intangible assets, at €93 million in the first quarter of 2013, were at the level of the prior-year period’s €92 million. Depreciation and amortization in the first three months totaled €102 million, against €88 million in the prior-year period. LANXESS-TSRC (Nantong) Chemical Industrial Co., Ltd., China, previously accounted for using the equity method, was fully consolidated for the first time, leading to additions in the mid-double-digit million range. The carrying amount of investments accounted for using the equity method decreased to €8 million. The ratio of non-current assets to total assets was 50.6%, up slightly from 49.8% on December 31, 2012.

Current assets amounted to €3,754 million, down by €18 million or 0.5%. Inventories rose by €114 million to €1,641 million compared to year end 2012 due to higher volumes. Trade receivables rose by €127 million against year end 2012, to €1,244 million. The total of cash and cash equivalents and near-cash assets decreased by €268 million to €529 million, mainly due to the sale of money market funds. The ratio of current assets to total assets was 49.4%, against 50.2% as of December 31, 2012.

The LANXESS Group has significant internally generated intangible assets that are not reflected in the statement of financial position because of accounting rules. These include the brand equity of LANXESS and the value of the Group’s other brands. A variety of measures were deployed in the reporting period to continually enhance these assets. These measures contributed to our continued success in positioning the business units in the market.

Our established relationships with customers and suppliers also constitute a significant intangible asset, which cannot, however, be reflected in the statement of financial position. The long-standing, trust-based partnerships with customers and suppliers, underpinned by consistent service and product quality, enable us to set ourselves apart from our competitors. Our competence in technology and innovation, also a valuable asset, is rooted in our specific knowledge in the areas of research and development and custom manufacturing. It enables us to generate significant added value for our customers.

Our commercial success is also founded on the knowledge and experience of our employees. In addition, we have sophisticated production and business processes that create competitive advantages for us in the relevant markets.

Equity rose by €56 million from December 31, 2012 to €2,386 million, predominantly due to the net positive effect of currency translation differences. The ratio of equity to the Group’s total assets amounted to 31.4% as of March 31, 2013, against 31.0% as of December 31, 2012.

Non-current liabilities grew by €70 million to €3,629 million as of March 31, 2013. The €22 million increase in pension provisions to €915 million was attributable mainly to additional vested rights and also to the change in the interest rates used for measurement. Other non-current financial liabilities rose by €33 million to €2,200 million, largely as the result of an increase in liabilities to banks. The ratio of non-current liabilities to total assets was 47.7%, compared with 47.3% as of December 31, 2012.

Current liabilities came to €1,588 million, down by €42 million or 2.6% from December 31, 2012. The change was primarily due to lower trade payables. By contrast, other current provisions increased. The ratio of current liabilities to total assets was 20.9% as of March 31, 2013, against 21.7% at the end of 2012.

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