The net cash inflow from operating activities of €487 million (previous year: €870 million) reflects the operating surplus and also takes into account changes in working capital and noncash income and expenses.
The €383 million decrease in cash flows from operating activities compared with the previous year was mainly attributable to a €331 million decline in EBITDA.
This was offset by a reduction in income tax payments by €27 million as well as a €17 million increase in funds freed up from working capital. The change in working capital was predominantly driven by funds of €202 million freed up from inventories, which compares to funds of €322 million tied up in the previous year. This effect was partially offset by funds of €268 million tied up in trade accounts receivable, compared to funds of €181 million freed up in the previous year.
Net cash outflow for investing activities in 2025 amounted to €1,295 million (previous year: €423 million).
These mainly related to cash outflows for property, plant, and equipment and intangible assets amounting to €770 million (previous year: €781 million), and cash outflows for other current financial assets amounting to €612 million (previous year: cash inflows of €296 million), which primarily resulted from net cash outflows for short-term bank deposits of €546 million and net purchases of money market fund units of €100 million. In addition, payments for acquisitions, net of cash acquired, amounted to €27 million and were made for the acquisition of Pontacol AG, Schmitten FR (Switzerland), a manufacturer of multilayer thermoplastic adhesive films, from LAS Holding AG, Sempach Station (Switzerland).
This was offset by interest and dividend payments of €40 million (previous year: €61 million) and cash inflows from sales of property, plant, equipment and other assets of €78 million (previous year: €76 million), which resulted in particular from the sale of intangible assets amounting to €65 million. In addition, there were cash inflows of €8 million from divestments less divested cash. They came mainly from the sale of the business activities at the East Providence site, Rhode Island (United States) (€6 million).
The cash inflow from financing activities amounted to €968 million in fiscal 2025 (previous year: cash outflow of €565 million). Net loan repayments amounted to €70 million (previous year: €414 million). Short-term borrowing and debt repayment were netted.
As in the previous year, no dividend was paid to Covestro AG shareholders in 2025.
As part of the investment agreement signed between Covestro AG and XRG in October 2024, the Board of Management and Supervisory Board of Covestro AG resolved that, on completion of the transaction, the capital stock of the company was to be increased by 10% (18,900,000 shares). The issuance of 18,900,000 new no-par value bearer shares resulted in cash inflows (net of transaction costs) of €1,172 million.
Total interest payments presented in cash flows from financing activities amounted to €132 million (previous year: €150 million) in fiscal 2025; they were mainly attributable to bonds and liabilities to banks, forward exchange transactions to hedge foreign currency risk, and lease liabilities. In addition, capitalized interest amounting to €18 million (previous year: €15 million) was recognized together with the associated assets under cash outflows for additions to property, plant, equipment, and intangible assets in cash flows from investing activities.
The following table shows the reconciliation of the changes in liabilities from financing activities to the cash flows from financing activities reported in the statement of cash flows. Interest payments are presented as part of the cash changes in liabilities from financing activities.
| Reconciliation of liabilities from financing activities in fiscal 2025 | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Carrying amounts Dec. 31, 2024 |
Cash changes1 | Noncash changes | Other3 | Carrying amounts Dec. 31, 2025 | |||||
| Changes due to exchange rate move-ments | Changes in measure-ment | Acqui-sitions | Lease contracts | Other changes2 | |||||
| € million | € million | € million | € million | € million | € million | € million | € million | € million | |
| Bonds | 1,492 | – | – | – | 2 | 1,494 | |||
| Liabilities to banks | 870 | 131 | (35) | 1 | – | 967 | |||
| Lease liabilities | 736 | (190) | (49) | – | 148 | 29 | 674 | ||
| Receivables / liabilities from forward exchange contracts (recognized assets / liabilities)4 | 11 | (39) | – | (49) | – | – | 53 | (24) | |
| Other financial debt | 41 | (40) | – | – | – | 1 | |||
| Accrued interest on liabilities | 16 | (50) | – | – | 66 | (18) | 14 | ||
| Other miscellaneous financial liabilities5 | – | (3) | – | – | 3 | – | |||
| Total | 3,166 | (191) | (84) | (49) | 1 | 148 | 100 | 35 | 3,126 |
1 In addition to payments related to equity transactions, the difference compared with the statement of cash flows is mainly attributable to the interest payments shown. The interest payments shown in the statement of cash flows also include fees and other financial expenses for obtaining money and credit, as well as payments that do not relate to liabilities from financing activities.
2 In addition to accrued interest, these relate mainly to discount unwinding.
3 Includes cash changes outside cash flows from financing activities.
4 Derivates that do not qualify for hedge accounting.
5 The differences of €21 million (previous year: €24 million) compared with the other financial liabilities presented in note 22 “Other Financial Liabilities” arise from items not related to financing activities.
| Reconciliation of liabilities from financing activities in fiscal 2024 | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Carrying amounts Dec. 31, 2023 |
Cash changes1 | Noncash changes | Carrying amounts Dec. 31, 2024 | ||||||
| Changes due to exchange rate move-ments | Changes in measure-ment | Acqui-sitions | Lease contracts | Other changes2 | Other3 | ||||
| € million | € million | € million | € million | € million | € million | € million | € million | ||
| Bonds | 1,990 | (500) | – | – | 2 | 1,492 | |||
| Liabilities to banks | 657 | 202 | 11 | – | 870 | ||||
| Lease liabilities | 743 | (185) | 22 | – | 126 | 30 | 736 | ||
| Receivables / liabilities from forward exchange contracts (recognized assets / liabilities)4 | (4) | (43) | – | 8 | – | – | 50 | 11 | |
| Other financial debt | 2 | 39 | – | – | 41 | ||||
| Accrued interest on liabilities | 19 | (64) | – | – | 76 | (15) | 16 | ||
| Other miscellaneous financial liabilities5 | – | (3) | – | – | 3 | – | |||
| Total | 3,407 | (554) | 33 | 8 | – | 126 | 111 | 35 | 3,166 |
1 In addition to payments related to equity transactions, the difference compared with the statement of cash flows is mainly attributable to the interest payments shown. The interest payments shown in the statement of cash flows also include fees and other financial expenses for obtaining money and credit, as well as payments that do not relate to liabilities from financing activities.
2 In addition to accrued interest, these relate mainly to discount unwinding.
3 Includes cash changes outside cash flows from financing activities.
4 Derivates that do not qualify for hedge accounting.
5 The differences of €24 million (previous year: €28 million) compared with the other financial liabilities presented in note 22 “Other Financial Liabilities” arise from items not related to financing activities.