Net assets

Overview of the DEUTZ Group’s net assets

€ million      
  31 Dec 2018 31 Dec 2017 1) Change (%)
Non-current assets 582.1 588.5 –1.1
Current assets 666.8 609.3 9.4
Assets classified as held for sale 0.4 0.4 0.0
Total assets 1,249.3 1,198.2 4.3
       
Equity 619.1 584.3 6.0
Non-current liabilities 212.3 240.4 –11.7
Current liabilities 417.9 373.5 11.9
Total equity and liabilities 1,249.3 1,198.2 4.3
       
Working capital 2) (€ million) 276.2 222.2 24.3
Working capital ratio (31 Dec, %) 15.5 15.0
Working capital ratio (average, in %) 15.8 13.4
Equity ratio 3) (%) 49.6 48.8
1) Figures as at 31 December 2017 adjusted as a result of the write-downs on the DEUTZ Dalian joint venture.
2) Inventories plus trade receivables less trade payables.
3) Equity/total equity and liabilities.

DEUTZ Group: Balance sheet structure

DEUTZ-Group_Balance_sheet_structure 0 30 60 90 2017 2018 2018 2017 % (2017 figures) 40.5 (43.3) Non-current assets 6.1 (5.8) Deferred taxes 26.7 (24.0) Inventories 12.6 (11.9) Trade receivables 3.5 (3.0) Other receivables and assets 10.6 (12.0) Cash and cash equivalents Assets 49.6 (48.8) Equity 7.2 (6.0) Other liabilities 17.2 (17.3) Trade payables 3.1 (3.8) Financial liabilities 13.3 (14.7) Pension provisions 9.6 (9.4) Other provisions Equity and liabilities Assets Equity and liabilities

Non-current assets

The change in the DEUTZ Group’s non-current assets can mainly be explained by two countervailing effects. Firstly, we disposed of our shares in the DEUTZ Dalian joint venture in the fourth quarter of 2018 after they had been written down in the middle of the year. Secondly, DEUTZ granted a loan of €13.8 million to the new owners of the business of Neue Halberg-Guss GmbH in November 2018.

Working capital

Working capital as at 31 December 2018 had increased to €276.2 million. The main reason for this was the rise in inventories and trade receivables, which was driven primarily by the higher volume of business. The working capital ratio 1) as at 31 December 2018 had therefore deteriorated to 15.5 per cent in spite of the increase in revenue. The average working capital ratio 2) went up. As at 31 December 2018, it stood at 15.8 per cent, which was the forecast for this key figure at the beginning of the year.

Equity

As at 31 December 2018, equity had risen to €619.1 million because of the net income generated in the reporting year. The equity ratio therefore increased to 49.6 per cent (31 December 2017: 48.8 per cent). It thus remains well above our target of above 40 per cent.

Non-current liabilities

The €28.1 million fall in non-current liabilities was largely attributable to the reduction in financial debt and provisions for pensions and other post-retirement benefits. Financial debt decreased as planned by €8.8 million to €19.3 million. The decline in provisions for pensions and other post-retirement benefits was mainly due to ongoing pension payments.

1) Working capital (inventories plus trade receivables less trade payables) as at the balance sheet date divided by revenue for the previous twelve months.
2) Working capital ratio (average, %): average working capital at the four quarterly reporting dates divided by revenue for the previous twelve months.