Notes to the Consolidated Financial Statements
1. Basic information and principles of the report
2. Changes in Group structure
3. Summary of significant accounting policies
4. Risk assessment and management
5. Management of capital
The objectives of the Group regarding the management of the capital structure are as follows:
- ensure sufficient liquidity to cover all liabilities
- ensure an attractive return on equity (ROE) and return on invested capital (ROIC)
- ensure a sufficient debt capacity and credit rating
- ensure an attractive distribution policy
In order to maintain or change the capital structure, the following measures can be taken:
- adjustment of the distribution policy
- share buyback programmes
- capital increases
- draw or repay debt
Further measures to guarantee an efficient use of the invested capital and therefore also to achieve attractive returns are:
- active management of net working capital
- demanding objectives regarding the profitability of investments
- clearly structured innovation process
The invested capital is composed of net working capital, property, plant and equipment, goodwill, and intangible assets.
The periodic calculation and reporting of the following key figures to the management ensures the necessary measures in connection with the capital structure can be taken in a timely manner.
The relevant values as of December 31 are outlined below:
| 2016 | 2015 | |
|---|---|---|
| MCHF | MCHF | |
| Gearing | ||
| Debt | 970.9 | 1,139.2 |
| Liquid funds and marketable securities | 509.7 | 459.6 |
| Net debt | 461.2 | 679.6 |
| Equity | 1,635.2 | 1,482.2 |
| Net debt/equity | 28.2% | 45.9% |
| Return on equity (ROE) | ||
| Equity (rolling) | 1,526.3 | 1,530.2 |
| Net income | 548.2 | 422.4 |
| ROE | 35.9% | 27.6% |
| Return on invested capital (ROIC) | ||
| Invested capital (rolling) | 2,704.6 | 2,504.9 |
| Net operating profit after taxes (NOPAT) | 545.8 | 425.6 |
| ROIC | 20.2% | 17.0% |