Financial Definitions

Financial Definitions

Trelleborg uses the following alternative performance measures relating to its financial position: return on shareholders’ equity and return on capital employed, net debt, debt/equity ratio and equity/assets ratio. The Group believes that these performance measures can be utilized by users of the financial statements as a supplement in assessing the possibility of dividends, making strategic investments and assessing the Group’s ability to meet its financial commitments. Trelleborg also uses the cash flow metrics of operating cash flow and free cash flow to provide an indication of the funds generated by the operations in order to conduct strategic investments, carry out amortizations and generate a return for its shareholders. Trelleborg uses the performance metrics of EBITDA, EBITA and EBIT excluding items affecting comparability, which the Group considers to be relevant for investors seeking to understand its earnings generation before items affecting comparability. The Group defines its key figures as follows.

For further description and calculation of key figures download the excel file

Average number of employees
Average number of employees during the year based on hours worked. Excluding insourced staff. 

Capital employed
Total assets less interest-bearing receivables and non-interest-bearing operating liabilities and excluding tax assets and tax liabilities.

Cash conversion ratio
Operating cash flow as a percentage of EBIT.

Debt/equity ratio, %
Net debt divided by total equity. 

Discontinuing operations
Profit from discontinuing operations is recognized net in the consolidated income statement in the item “Net profit in discontinuing operations”.

Earnings per share
Profit for the period, attributable to shareholders of the Parent Company, divided by the average number of shares outstanding.

Operating profit including items affecting comparability.

EBIT excluding items affecting comparability
Operating profit excluding items affecting comparability.

EBIT margin excluding items affecting comparability, %
EBIT excluding items affecting comparability as a percentage of net sales.

Operating profit excluding amortization and impairment of intangible assets and excluding items affecting comparability.

EBITA margin, %
EBITA as a percentage of net sales.

Operating profit excluding depreciation/amortization and impairment of PPE (including right-of-use assets) and intangible assets and excluding items affecting comparability.

EBITDA margin, %
EBITDA excluding participations in the profit/loss of jointly owned/associated companies as a percentage of net sales.

EBITDA/Net interest income/expense
EBITDA divided by net interest income/expense (interest income less interest expenses).

Equity/assets ratio, %
Total equity divided by total assets. 

Equity method
Associated companies and joint ventures in the Group are recognized in line with the equity method, implying that the initial participation is changed to reflect the Group’s share in the company’s profit or loss and for any dividends.

Free cash flow
Operating cash flow reduced by cash flow from financial items, taxes and the effect of restructuring measures on cash flow.

Free cash flow per share
Free cash flow divided by the average number of shares outstanding.

Items affecting comparability
The total of the restructuring costs approved by the Board of Directors and major non-recurring items. 

Net debt
Interest-bearing liabilities less interest-bearing assets and cash and cash equivalents.

Net debt/EBITDA
Net debt divided by EBITDA calculated on a 12-month revolving basis.

Number of employees at year-end
Including insourced staff and temporary employees.

Operating cash flow
EBITDA excluding non-cash items, capital expenditures, divested PPE, amortization of lease liabilities and changes in working capital. The performance measure excludes cash flow from items affecting comparability.

Operating cash flow per share
Operating cash flow divided by the average number of shares outstanding.

Organic growth
The sales growth in comparable exchange rates that is generated by the Group itself on its own merits and in the existing structure. An acquisition, or a divestment, is only included in the calculation of organic growth if it is included in an equal number of months in the current period and the corresponding of previous years. Otherwise, it is included in the calculation of structural growth.

P/E ratio
Market price divided by earnings per share. 

Pro forma
Pro forma calculations include total Group consolidation from the most recent 12-month period plus acquisitions and divestments in order to reflect current continuing operations.

Rate of capital turnover
Net sales as a percentage of average capital employed.

Return on capital employed, %
EBIT divided by the average capital employed calculated on 12 months revolving basis.

Return on shareholders’ equity, %
Profit for the period calculated on 12 months revolving basis, attributable to shareholders of the Parent Company divided by average equity, excluding non-controlling interests.

Dividend as a percentage of the market price.

Western Europe
Austria, Belgium, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Luxembourg, Malta, the Netherlands, Norway, Portugal, Sweden, Switzerland, Spain, the U.K.