- Average operating capital
Opening plus closing operating capital divided by 2.
- Average shareholders’ equity
Opening plus closing equity attributable to the equity holders of the Parent divided by two.
- Dividend pay-out ratio (%)
100 x Dividend (proposed after year-end) ÷ Earnings per share from continuing operations, basic
Dividend payout ratio is used to measure the percentage of net profits distributed as a dividend to the shareholders.
- Dividend yield (%)
100 x Dividend (proposed after year-end) ÷Year-end share price
Dividend yield is used as a measure of the cash return to shareholders.
- Earnings per share
Profit for the year attributable to equity holders of the Parent divided by average number of shares outstanding (excluding treasury shares).
Earnings excluding net finance cost, tax, amortization and impairments of intangible assets
EBITA is, based on the assumption that depreciations are a fair measure for capital expenditures, used as a proxy for the free cash flow available for payment of financial obligations.
- EBITA interest coverage ratio
EBITA ÷ (Interest expense – interest income)
EBITA interest coverage ratio is used to measure the ability to fund interest expenses.
Earnings excluding net finance cost, tax, depreciation, amortization and impairments of tangible and intangible assets
EBITDA is used as an alternative measure of operating performance that is not impacted by historical investments and the related accounting treatment of such investments. This measure sometimes serves as a better comparison of operating performance between companies than operating profit (EBIT).
- EBITDA margin, %
100 × EBITDA ÷ Sales
EBITDA margin is used as an alternative measure of operating profitability.
- Equity per share
Equity attributable to equity holders of the Parent divided by number of shares outstanding at year-end (excluding treasury shares).
- Equity/assets ratio (%)
Total equity as a percentage of total assets.
- Larger one-time items
Larger one-time items are separately disclosed non-recurring income and cost
Disclosures of one-time items are used to provide a better measure of underlying performance and a better comparison between periods.
- Net debt
Interest-bearing liabilities, adjusted for hedges relating to these liabilities + net provisions for pensions and similar obligations – cash and cash equivalents and other investments
Net debt is used as a measure of net financial obligations.
- Net debt/EBITA
Net debt/EBITA is used as an indication of the duration (in years) required to fund existing net financial obligations with the Company’s free cash flows.
- Operating capital
Current operating assets + intangible assets + tangible assets + other non-current operating assets – current and non-current operating liabilities
Operating capital is used to measure the capital employed within operations.
- Operating margin (%)
100 × Operating profit ÷ Sales
Operating profit margin is used to measure the operational profitability.
- Operating profit (EBIT)
Earnings excluding net finance cost and taxes
Operating profit is used to measure the operating performance, excluding the impact of financing and corporate income tax.
- Operating profit (EBIT) from product areas
Earnings from product areas excluding net finance cost and tax
Operating profit is used to measure the operating performance of the product areas, excluding the impact of financing and corporate income tax.
- P/E ratio
Share price at year-end ÷ Earnings per share
P/E ratio is used to measure the market valuation in relation to the net profit generation.
- Return on operating capital (%)
100 × Operating profit ÷ Average operating capital
Return on operating capital is used to measure how efficiently capital is employed within the operations.
- Share turnover rate (%)
Annual turnover of shares as a percentage of total number of shares.
- Total return (%)
100 × (Share price at year-end – share price at preceding year-end) + (dividend paid + return on reinvested dividend) ÷ Share price at preceding year-end
Total return is used to measure the Company’s total value creation for the shareholder, including cash returns and share price appreciation/depreciation.