Supplementary definitions of financial ratios
Supplementary definitions of financial ratios
The financial information in this annual report is supplemented by certain financial ratios which are not defined in the Swiss GAAP FER. These help the management to assess and quantify the company’s performance. They may differ from similar metrics used at other companies, and should not be regarded as replacing the Swiss GAAP FER ratios. They are defined as follows:
Growth rate
The growth rate is the increase or decrease in a ratio, expressed as a percentage of the corresponding value for the prior period.
Changes at constant currency
Changes at constant currency are calculated by translating the ratios in question using the exchange rates valid in the prior period.
Gross profit / gross profit margin
Gross profit is calculated as:
+ Net sales
+ Other operating income
+ Change in inventories
- Cost of materials
- Cost of energy
Gross profit margin is gross profit as a percentage of net sales.
EBITDA / EBITDA margin
EBITDA (operating result before depreciation and amortization) is calculated as follows:
+ Operating result (EBIT)
+ Depreciation on tangible fixed assets
+ Amortization on intangible assets
+ Impairment of fixed assets
EBITDA margin is EBITDA as a percentage of net sales.
EBIT / EBIT margin
EBIT (earnings before interest and taxes) is the operating result. EBIT margin is EBIT as a percentage of net sales.
EBIT before impairment / EBIT margin before impairment
EBIT before impairment is calculated as follows:
+ Operating result (EBIT)
+ Impairment of fixed assets
EBIT margin before impairment is EBIT before impairment as a percentage of net sales.
Return on equity
Return on equity is calculated by dividing the net result by average shareholders’ equity. Average shareholders’ equity is the average of the shareholders’ equity at the beginning and at the end of the reporting period.
Cash flow
Cash flow (before change in non-financial net working capital) is calculated as follows:
+ Cash flow from operating activities
+ Change in trade receivables
+ Change in inventories
+ Change in other receivables, prepayments and accrued income
+ Change in trade payables
+ Change in other payables, accrued expenses and deferred income
Free cash flow
Free cash flow is calculated as follows:
+ Cash flow from operating activities
+ Cash flow from investing activities
Net liquid assets
Net liquid assets are calculated as follows:
+ Cash and cash equivalents
- Current and non-current financial liabilities
Net debt
Net debt is calculated as follows:
+ Current and non-current financial liabilities
- Cash and cash equivalents
Net-debt-to-EBITDA ratio
The net-debt-to-EBITDA ratio is calculated by dividing net debt by EBITDA (operating result before depreciation and amortization).
Equity ratio
The equity ratio is shareholders’ equity (including minorities) as a percentage of total assets.
Capital employed
Capital employed is calculated as follows:
+ Trade receivables
+ Other receivables
+ Inventories
+ Prepayments and accrued income
+ Tangible fixed assets
+ Financial assets
- Deferred income tax assets
+ Intangible assets
- Trade payables
- Other current and non-current liabilities
- Current and non-current provisions
+ Deferred income tax liabilities
- Accrued expenses and deferred income
Net operating profit after tax (NOPAT)
+ EBIT (earnings before interest and taxes) before impairment
- Income tax calculable thereon at the tax rate expected for the period
Return on capital employed (ROCE)
Return on capital employed (ROCE) is calculated by dividing net operating profit after tax (NOPAT) by average capital employed. Average capital employed is the average of the capital employed at the beginning and at the end of the reporting period.