Financial structure
Sound financial foundation
The further increase in free cashflow (+10.7%) allowed the attractive dividend policy and the share buyback programme to be continued while also maintaining the very healthy financial foundation of the Group.
In April 2019, two new CHF bonds of CHF 125 million each were issued, thus enabling an expiring bond to be refinanced and the maturity structure of the debt to be optimised.
Total assets increased from CHF 3,502 million to CHF 3,725 million. Liquid funds (including marketable securities and other short-term investments) grew from CHF 282 million to CHF 428 million. In addition, the Group had access to undrawn operating credit lines for the operating business of CHF 591 million. At CHF 837 million, debt remained at the previous year’s level. Overall, this resulted in a decline in net debt of CHF 146 million to CHF 409 million at the end of 2019.
Debt
(in CHF million; as of 31 December) |
|||
|---|---|---|---|
| 2017 | 2018 | 2019 | |
| Long-term debt | 891 | 683 | 811 |
| Total debt | 895 | 837 | 837 |
| Liquid funds (including marketable securities and other short-term investments) | 413 | 282 | 428 |
| Net debt | 482 | 555 | 409 |
Net working capital dropped by CHF 4 million year-on-year to CHF 202 million. Property, plant and equipment increased from CHF 829 million to CHF 920 million primarily as a result of a change in the IFRS accounting standard. Goodwill and intangible assets declined from CHF 1,652 million to CHF 1,597 million due to amortisation and exchange-rate effects.
The ratio of net debt to equity (gearing) contracted from 31.8% in the previous year to 21.5%. The equity ratio reached a very solid 51.0% (previous year 49.8%). The ratio of net debt to EBITDA dropped slightly to 0.5x (previous year 0.6x). Based on average equity, the return on equity (ROE) came to 35.8% (previous year 34.5%). Average invested operating capital, comprising net working capital, property, plant and equipment, goodwill and intangible assets amounted to CHF 2,810 million at the end of 2019 (previous year CHF 2,823 million). The return on invested capital (ROIC) rose to 23.1% (previous year 22.6%).
The Geberit Group held 1,034,123 treasury shares on 31 December 2019, which equals 2.8% of the shares entered in the Commercial Register. Of these, 764,551 (2.1% of the shares entered in the Commercial Register) originate from the ongoing share buyback programme, while the remaining 269,572 are mostly earmarked for participation plans. The total number of shares entered in the Commercial Register stands at 37,041,427 shares.
The aforementioned share buyback programme began on 6 June 2017. Over a maximum period of three years, shares for a total amount of maximum CHF 450 million will be repurchased, less withholding tax. The shares are repurchased via a separate trading line on the SIX Swiss Exchange for the purpose of a capital reduction. Execution has been delegated to an external third party. By 31 December 2019, 764,551 shares had been acquired at a sum of CHF 323 million. The average purchase price per share was CHF 422.88. During the reporting year, 113,750 shares were acquired as part of the programme at a sum of CHF 47 million.
