Statement of cash flows

(€ million)Note 20092010
Net profit 732 1,106
Adjustments for reconciling profit for the year with cash flows from operating activities:
Amortisation and depreciation (24) 613 668
Impairment losses 10
Equity method valuation effect (26) (21) (47)
Net capital losses on asset sales, cancellations and eliminations 6 8
Interest income (9) (4)
Interest expense 212 260
Income taxes (27) 347 532
Other changes 4
Changes in working capital:
- Inventories 51 (7)
- Trade receivables (164) (39)
- Trade payables (12) (3)
- Provisions for risks and charges 23 18
- Other assets and liabilities (15) 65
Working capital cash flows (117) 34
Change in provisions for employee benefits (1) (1)
Dividends collected 34
Interest collected 10 4
Interest paid (204) (258)
Income taxes paid net of reimbursed tax credits (408) (571)
Net cash flows from operating activities 1,164 1,775
- of which with related parties (30) 1,134 1,663
Investments (*):
- Property, plant and equipment (1,053) (1,056)
- Intangible assets (168) (366)
- Change in consolidation scope and business units (4,478) (137)
- Change in payables and receivables relating to investments 16 152
Cash flows from investment activities (5,683) (1,407)
Divestments (*):
- Property, plant and equipment 8 4
- Intangible assets 10 10
- Equity investments 12
- Change in payables and receivables relating to divestments
Cash flows from divestments 30 14
Net cash flows from investment activities (5,653) (1,393)
- of which with related parties (30) (4,596) (220)
Taking on long-term financial debt 12,407 1,020
Repaying long-term financial debt (10,564) (915)
Increase (decrease) in short-term financial debt (313) 259
1,530 364
Net equity capital injections 3,445 2
Dividends paid to Snam Rete Gas shareholders (450) (776)
Net cash flows from financing activities 4,525 (410)
- of which with related parties (30) 3,209 (66)
Net cash flow for the period 36 (28)
Cash and cash equivalents at start of period 0 36
Cash and cash equivalents at end of period 36 8

(*) As a result of the reclassifications carried out in response to the implementation of international accounting standard IFRIC 12 (see “Changes to accounting criteria”) and of the change in the way payments for balancing and stock replenishment are recorded, the related cash flows for 2009 were reclassified respectively from “Property, plant and equipment” to “Intangible assets” and from “Provisions for risks and charges” to “Other assets and liabilities”.

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