Trends: Assets

Increase in Fixed Assets Due to Capital Expenditures and Right-of-Use Assets from Leases

Relative to the end of the previous year, fixed assets (including equity-accounted investments) increased by €235.5 million to €3.36 billion (Dec. 31, 2020: €3.13 billion). Property, plant and equipment rose to €2.47 billion (Dec 31, 2020: €2.39 billion). Capital expenditures increased to €343.8 million (2020: €224.4 million). Investments were focused on WACKER SILICONES and WACKER POLYMERS, as well as on infrastructure measures. Over half of investment spending was in Germany. Current depreciation/amortization amounted to €404.2 million. Changes in exchange rates increased the carrying amount of property, plant and equipment by about €100 million. The effects stemmed from the decline in value of the euro against the US dollar in the course of the year. Right-of-use assets from leases amounted to €138.8 million as of the reporting date (Dec. 31, 2020: €110.8 million). Financing liabilities from leases totaled €153.7 million (Dec. 31, 2020: €122.8 million).

On December 9, 2020, Wacker Chemie AG signed an agreement with GlobalWafers Co. Ltd., a Taiwanese competitor of Siltronic AG, to sell WACKER’s stake of 30.83 percent in Siltronic as part of a takeover bid by GlobalWafers. The offer period ended on February 10, 2021, with more than 50 percent of Siltronic’s shareholders accepting the offer price of €145 per share. Effective December 31, 2020, WACKER reclassified its investment of €550.4 million in Siltronic as assets held for sale. On December 31, 2021, the stake in Siltronic AG was reclassified once again as an equity-accounted investment, with retroactive effect as of December 31, 2020. On the reporting date, sale of the stake was no longer considered to be highly probable, given that 12 months had elapsed and the sale had not yet taken place, and the German authorities’ approval was deemed difficult to obtain. This assessment proved correct when the takeover was ultimately not approved. The takeover bid expired on January 31, 2022 without having been cleared by the German authorities. As a result, the carrying amount of the equity-accounted investment in Siltronic as of December 31, 2021 was €659.0 million (Dec. 31, 2021: €550.4 million), which included the profit of €62.1 million generated by the investment.

Noncurrent Assets

Other noncurrent assets totaled €923.5 million as of December 31, 2021 (Dec. 31, 2020: €794.2 million), up 16.3 percent year over year. This increase was attributable in particular to securities totaling €318.5 million. WACKER invested a portion of its high cash inflow in US$-denominated fixed-interest securities, which are destined for the scheduled repayment of a US-dollar loan. Deferred tax assets declined markedly, from €770.8 million to €569.7 million, reflecting higher discount rates on provisions for pensions.

Working Capital Rises 15 Percent

Current assets grew 27.1 percent year over year and amounted to €3.85 billion (Dec. 31, 2020: €3.03 billion). The increase was due mainly to the build-up of liquid assets. Inventories also grew, with an increase of 33.8 percent, rising from €879.5 million to €1.18 billion, mainly due to higher raw-material prices year over year.

As of December 31, 2021, working capital was up 14.6 percent versus the 2020 reporting date, and amounted to €1.24 billion (Dec. 31, 2020: €1.08 billion). The chief drivers of this growth were an increase of 33.8 percent in inventories and the rise of 31.6 percent in trade receivables to €824.8 million (Dec. 31, 2020: €627.0 million). Trade payables rose 79.6 percent, also due to higher raw-material prices.

Liquidity Increases to €1.98 Billion

Securities, fixed-term deposits, and cash and cash equivalents are major components of other current assets. Current securities and fixed-term deposits amounted to €738.2 million at the end of Q4 2021 (Dec. 31, 2020: €712.0 million) after WACKER invested liquid assets in funds and fixed-term deposits. Cash and cash equivalents reached €926.6 million as of December 31, 2021 (Dec. 31, 2020: €626.0 million). Overall, liquid assets (current and noncurrent securities, cash and cash equivalents) thus grew to €1.98 billion year over year (Dec. 31, 2020: €1.34 million), an increase of 48.2 percent. The main reasons for this growth were very good operating performance and advance payments received for future polysilicon deliveries. In Q4 2021, WACKER paid €250 million to a newly established contractual trust arrangement (CTA). Wacker Chemie AG’s dividend payment of €99.4 million in Q2 2021 (2020: €24.8 million) also reduced liquid assets.