Financial position

Continued strong financial position

Net debt in the Volvo Group's Industrial Operations amounted to SEK 23.0 billion at December 31, 2012, equal to 29.3% of shareholders’ equity. Excluding provisions for post-employment benefits the Industrial Operation’s net debt amounted to SEK 19.0 billion, which was equal to 24.3% of shareholders’ equity.

The Volvo Group’s cash, cash equivalents and marketable securities combined, amounted to SEK 28.9 billion at December 31, 2012 which includes SEK 0.2 billion not available for use by the Volvo Group and SEK 9.4 billion where other limitations exist, mainly liquid funds in countries where exchange controls or other legal restrictions apply. In addition to this, granted but not utilized credit facilities amounted to SEK 33.1 billion.

Total assets in the Volvo Group amounted to SEK 338.7 billion as of December 31, 2012, a decrease of SEK 14.5 billion compared to year-end 2011. The decrease is mainly a result of changes in currency rates and the divestment of Volvo Aero which is offset by  increased customer financing receivables due to portfolio growth in the Customer Finance Operations and an increase in assets under operating lease mainly related to the construction equipment rental operation.  

The Volvo Group’s intangible assets amounted to SEK 40.4 billion as of December 31, 2012. Investments in research and development amounted to SEK 5.4 billion in 2012, resulting in a net value of capitalized development costs of SEK 13.4 billion at the end of the year. The Volvo Group’s total goodwill amounted to SEK 23.3 billion as of December 31, 2012, an decrease by SEK 0.6 billion compared to year-end 2011 as a result of translation differences. 

The tangible assets increased by SEK 5.6 billion during 2012, mainly related to the expansion in the construction equipment rental operation.

The value of the inventories decreased by SEK 4.2 billion during 2012. The decrease is mainly related to finished products within trucks and construction equipment.

The net value of assets and liabilities related to pensions and similar obligations amounted to SEK 4.0 billion as of December 31, 2012, a decrease of SEK 0.4 billion compared to year-end 2011. Post-employment benefits valued at SEK 13.9 billion were reported outside the Volvo Group’s balance sheet. For further information see Note 20.

At year-end, the equity ratio in the Industrial Operations was 30.9% and in the Volvo Group 25.7%. Equity in the Volvo Group amounted to SEK 86.9 billion at December 31, 2012.