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Cash flows

In CHF million   31.03.2020   31.03.2019   Change
Operating income before depreciation and amortisation (EBITDA)   1,111   1,119   (8)
Lease expense   (75)   (68)   (7)
EBITDA after lease expense (EBITDA AL)   1,036   1,051   (15)
Capital expenditure   (516)   (518)   2
Operating free cash flow proxy   520   533   (13)
Change in net working capital   (205)   (41)   (164)
Change in defined benefit obligations   14   12   2
Net interest payments on financial assets and liabilities   (5)   (3)   (2)
Income taxes paid   (119)   (242)   123
Other operating cash flows   (16)   (15)   (1)
Free cash flow   189   244   (55)
Net expenditures for company acquisitions and disposals   (8)   (246)   238
Other cash flows from investing activities, net   1   14   (13)
Issuance of financial liabilities   1,574   222   1,352
Repayment of financial liabilities   (562)   (310)   (252)
Other cash flows from financing activities   (33)   (6)   (27)
Net increase (net decrease) in cash and cash equivalents   1,161   (82)   1,243

Operating free cash flow proxy declined by CHF 13 million to CHF 520 million, owing mainly to lower EBITDA after lease expense (EBITDA AL). At CHF 516 million, capital expenditure was practically unchanged from the previous year’s level.

Free cash flow declined year-on-year by CHF 55 million to CHF 189 million. The decrease was mainly attributable to the change in net working capital. Net working capital grew by CHF 205 million compared with the end of 2019 (prior year: increase of CHF 41 million). Deferred income tax payments partially offset this effect.

In the first quarter of 2020, Swisscom took on short-term bank loans from unconfirmed credit lines to secure liquidity. Swisscom also has two confirmed lines of credit totalling CHF 2.0 bil­lion, which had not been used as at 31 March 2020. Net expenditure for company acquisitions and disposals in the previous year includes the purchase price of CHF 240 million paid to Tamedia for the acquisition of the outstanding share of 31% in Swisscom Directories Ltd.