Cash flows

In CHF million
  1st half-year
  1st half-year
Operating income before depreciation and amortisation (EBITDA)   2,208   2,240   (32)
Lease expense   (150)   (137)   (13)
EBITDA after lease expense (EBITDA AL)   2,058   2,103   (45)
Capital expenditure   (1,075)   (1,297)   222
Operating free cash flow proxy   983   806   177
Change in net working capital   (87)   (161)   74
Change in defined benefit obligations   29   26   3
Net interest payments on financial assets and liabilities   (11)   (5)   (6)
Interest payments on finance lease liabilities   (22)   (15)   (7)
Income taxes paid   (156)   (293)   137
Other operating cash flow   25   18   7
Free cash flow   761   376   385
Net expenditures for company acquisitions and disposals   (25)   (288)   263
Other cash flows from investing activities, net   (3)   17   (20)
Issuance of financial liabilities   887   957   (70)
Repayment of financial liabilities   (543)   (35)   (508)
Dividends paid to equity holders of Swisscom Ltd   (1,140)   (1,140)  
Other cash flows from financing activities   (16)   (6)   (10)
Net decrease in cash and cash equivalents   (79)   (119)   40

Operating free cash flow proxy increased by CHF 177 million to CHF 983 million, mainly due to lower capital expenditure. In the previous year, capital expenditure included CHF 196 million for mobile radio frequencies in Switzerland. Excluding the expenditure for mobile radio frequencies, the operating free cash flow proxy decreased by CHF 19 million or 1.9%.

Free cash flow increased year-on-year by CHF 385 million to CHF 761 million. Adjusted for expenditure for mobile radio frequencies, free cash flow rose by CHF 189 million. The increase is due to deferred income tax payments and net working capital development. Net working capital grew by CHF 87 million compared with the end of 2019 (prior year: increase of CHF 161 million).

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 31% share in Swisscom Directories Ltd.

In the second quarter of 2020, Swisscom became the first listed company in Switzerland to issue a Green Bond in EUR. The amount borrowed amounts to EUR 500 million. The coupon is 0.375% and the term 8.5 years. The funds will be used according to the Green Bond Framework. The selection of projects is closely aligned with Swisscom’s sustainability strategy and at the same time takes into account the UN’s Sustainable Development Agenda 2030 and its objectives (Sustainable Development Goals, SDGs). A particular focus is on increased energy efficiency, renewable energies, climate protection (SDGs 7 and 13) and the provision of a state-of-the-art and resilient grid infrastructure (SDG 9).