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Financial structure

Solid financial foundation

In spite of the share buyback program that continued until the end of the reporting year, free cashflow made a substantial contribution to the very solid financial foundation of the Geberit Group.

Total assets declined from CHF 2,122.7 million to CHF 2,007.4 million as the strong Swiss franc again had a dampening effect on many balance sheet items.

The cash reserve shrunk appreciably as a result of the buyback of own shares and the scheduled repayment of debts. In addition to liquid funds and marketable securities of CHF 423.1 million (previous year CHF 542.0 million), the Group had access to an undrawn operating credit line of CHF 197.9 million. In the wake of the repayment of debts mentioned above, debt decreased by CHF 60.9 million to CHF 14.7 million. This resulted in a positive net cash level in the form of net debt of CHF -408.4 million at the end of 2012 (previous year CHF -466.4 million).

Net working capital grew by CHF 20.3 million to CHF 134.4 million, mainly as a result of sales growth. Property, plant and equipment strengthened slightly from CHF 516.2 million to CHF 521.2 million, while goodwill and intangible assets contracted from CHF 645.2 million to CHF 638.1 million.

The ratio of net debt to equity (gearing) declined from -32.9% in the previous year to -28.5%. The equity ratio improved from 66.9% to a very solid 71.3%. Based on average equity, the return on equity (ROE) was 28.1% (previous year 26.0%). Average invested operating capital, comprising net working capital, property, plant and equipment, goodwill and intangible assets amounted to CHF 1,346.0 million at the end of 2012 (previous year CHF 1,327.6 million). The return on invested capital (ROIC) was 29.3% (previous year 28.8%). For details on the gearing, ROE and ROIC calculations, please refer to the  Financial Statements of the Geberit Group, Notes to the Consolidated Financial Statements, 5. Management of Capital.

The Geberit Group held 1,235,345 treasury shares on December 31, 2012, which equals 3.2% of the shares entered in the Commercial Register. Of these, 1,022,578 (2.6% of the shares entered in the Commercial Register) were acquired as part of the share buyback program that started at the beginning of 2011. The remaining 213,000 treasury shares are mostly earmarked for share participation plans. The share buyback program ended prematurely on December 20, 2012. In total, 2,048,578 registered shares in the amount of CHF 390,172,725, corresponding to 5.28% of the share capital currently entered in the Commercial Register, were repurchased as originally planned. The buyback program was carried out through a second trading line set up specially for this purpose. The average purchase price per share was CHF 190.46. The General Meeting of April 4, 2012, approved a share capital reduction in the amount of the shares repurchased in 2011. The capital reduction was carried out on June 29, 2012, following expiry of a two-month deadline and the publication of three notices to creditors in the Swiss Commercial Gazette. The total number of shares entered in the Commercial Register now stands at 38,821,005 shares. As far as the remaining 1,022,578 shares repurchased in 2012 are concerned, the intention is to propose a share capital reduction to the General Meeting on April 4, 2013, and to cancel these shares.