Report on Economic Position – Results of Operations, Financial Position, and Net Assets of the Covestro Group
Net Assets
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Dec. 31, 2020 |
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Dec. 31, 2021 |
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€ million |
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€ million |
Noncurrent assets |
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6,734 |
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8,610 |
Current assets |
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6,190 |
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6,961 |
Total assets |
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12,924 |
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15,571 |
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Equity |
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5,644 |
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7,762 |
Noncurrent liabilities |
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4,916 |
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4,203 |
Current liabilities |
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2,364 |
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3,606 |
Liabilities |
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7,280 |
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7,809 |
Total equity and liabilities |
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12,924 |
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15,571 |
Total assets increased by €2,647 million to €15,571 million as of December 31, 2021 (December 31, 2020: €12,924 million).
Noncurrent assets were up by €1,876 million to €8,610 million (previous year: €6,734 million) and accounted for 55% (previous year: 52%) of total assets. This increase is largely attributable to the property, plant, equipment, and intangible assets acquired as part of the RFM business and recognized at fair value along with the resulting goodwill recognized in this process.
Current assets were up €771 million to €6,961 million (previous year: €6,190 million), and their ratio to total assets was 45% (previous year: 48%). This change occurred as a result of the increase in inventories and trade accounts receivable, whereas current financial assets and cash and cash equivalents declined year over year.
Covestro Group’s balance sheet structure
Equity increased by €2,118 million to €7,762 million as of December 31, 2021 (previous year: €5,644 million). The equity ratio at the reporting date was 50% (previous year: 44%). The growth in equity is mainly attributable to income after income taxes for fiscal 2021, the remeasurement of pension obligations, and positive foreign exchange differences. The dividend distribution for fiscal 2020 had the opposite effect.
Noncurrent liabilities decreased by €713 million to €4,203 million as of the reporting date (previous year: €4,916 million) and accounted for 27% (previous year: 38%) of total capital and 54% (previous year: 68%) of liabilities. This is primarily due to lower provisions for pensions and other post-employment benefits.
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Dec. 31, 2020 |
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Dec. 31, 2021 |
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€ million |
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€ million |
Provisions for pensions and other post-employment benefits |
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2,123 |
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1,199 |
Net defined benefit asset |
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(2) |
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(4) |
Net defined benefit liability for post-employment benefits |
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2,121 |
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1,195 |
The net defined benefit liability for post-employment benefits (pension obligations less plan assets) was down by €926 million in the reporting year to €1,195 million (previous year: €2,121 million). This was due to actuarial gains, especially those attributable to the increase in the discount rate in Germany and the United States as well as the November 2021 contribution of money market fund units totaling €500 million to pension plan assets.
Current liabilities increased by €1,242 million to €3,606 million (previous year: €2,364 million) and accounted for 23% (previous year: 18%) of total equity and liabilities and 46% (previous year: 32%) of liabilities. This increase was attributable chiefly to trade accounts payable and other provisions. The early repayment of the €500 million euro bond placed in fiscal 2016 had the opposite effect.