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lower limit of an investment grade Rating. Through the

capital infusion fromthe joint venture transaction, our net

corporate debt at the end of March has been practically

equalised. The indebtedness is since defined by our

pension provisions, which amounted to roundabout

1,4 billion € as of March 31. The present financial ratios

permit a return to the “BBB-“ range. Whether the Rating

Agencies will share this view, we will see during summer,

when the yearly talks and reviews will have taken place.

With the further funding of the pensions by 200 mio €,

you will reach a funding ratio of 51 %. The DAX Index 30

Corporations on average have a ratio of 65 %. Are you

striving for the medium term for a higher funding ratio?

The size of the funding ratio is to be seen against the

background, that the pension provisions are breathing

with the interest rates. A swing by 100 basispoints, at

us makes a change of around 250 to 300 mio € at the

pension provisions, although nothing changes as to the

cash flow. Therefore I can live quite well with the present

funding ratio. When looking at the DAX 30 corporations,

one has to be aware, that the financial corporations do

have a very high funding ratio. If one limits the view at

the industrial corporations, we are positioned along the

same level.

How high are the pension provisions, which Arlanxeo is

provided with on its way?

Only low pension provisions have been handed over to

this joint venture, because the majority of the employees

of Arlanxeo is employed abroad. The big synthetic plants

are located in the USA, Brasil, China, Singapore and

Belgium. There exist mostly pension plans, which are

generally not permitting a funding by way of provisions,

as they are customary in Germany. In the balance sheet

of Arlanxeo there are practically no financial debts. This

we have done consciously, in order to show on the one

hand to the employees, that the company is structured

and financed in an orderly way, and on the other hand

that it can participate in the expected consolidation of

the industry.

Pension provisions, one may think perhaps of

ThyssenKrupp, can become a serious problem. Is the

German special way suboptimal?

Pension provisions especially do come along with

volatility. From this point of view, the internal financing is

good only to a certain degree. It is necessary to find the

right balance.

Are pension provisions playing a role when talking to

shareholders, especially to Anglosaxon shareholders?

Anglosaxon shareholders do not look that much on

pension provisions, but rather on the cash flow. It is

especially the Rating Agencies and the debt providers,

who have a precise look at the pension provisions. They

interpret them as a loan given by the employees.

Which view, in your opinion, provides the better


It is the triple accord of the balance sheet, the profit and

loss account, and of the flow of funds statement. For

increasing the corporation value, we must take care of

the cash flow, which means, we must have control over

the costs, and we must make reasonable investments.

But the most beautiful cash flow serves no purpose,

when too much debt is being taken up for this. To

have this in a harmonic accord, at the end results in an

investment grade Rating, and this is how we are steering

the corporation group.

To generate cash is for the share investors only then

attractive, when at the same time a related dividend

is being paid. Especially as concerns the payout ratio,

Lanxess is not very generous, apart from the dividend

for 2014. How do you resolve this contradiction?

We have at last increased the dividend by 20 %. At the

same time we have worded the objective, to hold the

dividend at least stable, but increase it every year if

possible. One has to balance between dividend and

capital expenditure, in order to have at the end a higher

return on the invested capital. We try to get this into a


The payout ratio is thus no relevant measure for you?

Of course we are also looking at the payout ratio. But we

do not commit ourselves to a fixed payout ratio.

With your statement, to pay at least a stable, but

possibly an increasing dividend, you have started to go

on a new path. What are the reasons?

The definition of the payout policy goes along with the

objective, to - based on steady growth - decrease the

cyclicality and to increase the cash flow. We want to be a

reliable payer of dividends for our shareholders.

The most beautiful cash flow serves no purpose,

when too much debt is being taken up for this.