Nederman Channel and Partner Program

Definitions

Return on equity
Net profit for the year after tax divided by average equity.
Return on equity shows the return on owners’ capital in accounting terms. This measure is primarily used to analyse owner profitability over time.

Return on operating capital
Adjusted operating profit as a percentage of average operating capital.
A profitability measure that shows the return on the capital used to operate the core business. Return on operating capital is one of Nederman group’s long-term financial targets.

EBITA
Operating profit before amortisation and impairment of intangible assets.
EBITA is reported because this is a measure often monitored by investors, analysts and other stakeholders to measure the company’s financial results. The measure excludes the amortisation and impairment of intangible assets.

EBITA margin
EBITA as a percentage of sales.

EBITDA
Operating profit before depreciation, amortisation and impairment.
EBITDA is reported because this is a measure often monitored by investors, analysts and other stakeholders to measure the company’s financial results. The measure excludes depreciation, amortisation and impairment, thereby showing the business’s capacity to generate resources for investments and payment to financiers.

EBITDA margin
EBITDA as a percentage of net sales.

Equity per share
Equity divided by the average number of shares outstanding.
This measure shows how much equity is represented by each share.

Adjusted EBITA
Operating profit before amortisation and impairment of intangible assets, excluding acquisition and restructuring costs and discontinuation of the Norwegian defined-benefit pension plan.
Adjusted EBITA is deemed to provide a fair view of the underlying operation’s earnings, whereby earnings exclude amortisation and impairment of intangible assets and non-recurring items. This is a primary performance measure within the Nederman group in the internal control of the group and the segments.

Adjusted EBITA margin
Adjusted EBITA as a percentage of sales.
The adjusted EBITA margin is one of the Nederman group’s long-term profitability targets. Adjusted EBITA margin is deemed to provide a fair view of the underlying operation’s profitability, when this profitability excludes depreciation, amortisation and impairment, as well as income items that are non-recurring. This is a primary performance measure within the Nederman group in the internal control of the group and the segments.

Adjusted EBITDA
Operating profit before depreciation, amortisation and impairment, excluding acquisition and restructuring costs and discontinuation of the Norwegian defined-benefit pension plan.
Adjusted EBITDA is recognised because this is a measure often monitored by investors, analysts and other stakeholders to measure the company’s financial results. The measure excludes depreciation, amortisation and impairment, as well as non-recurring items. The measure shows the business’s capacity for investments and payment to financiers.

Adjusted EBITDA margin
Adjusted EBITDA as percentage of sales.

Adjusted EBITDA/Net financial items
Adjusted EBITDA divided by net financial items
The performance measure shows how many times current earnings (adjusted EBITDA) covers the company’s net financial items.

Adjusted operating profit
Operating profit excluding acquisition and restructuring costs and discontinuation of the Norwegian defined-benefit pension plan.
Shows the result from operational activities excluding non-recurring items.

Adjusted operating margin
Adjusted operating profit as a percentage of net sales.

Capital turnover rate
Net sales divided by average operating capital.
Shows the efficiency of the use of operating capital.

Net debt
Interest-bearing liabilities (including pensions) less cash and cash equivalents.
The measurement shows debt and is used to monitor the debt trend and to identify the need for refinancing. This measure comprises a component of the debt ratio.

Net debt/adjusted EBITDA
Net debt divided by adjusted EBITDA.
The performance measure shows how many times greater net debt is in relation to adjusted EBITDA. This is a performance measure monitored by investors, analysts and other stakeholders.

Net debt/equity ratio
Net debt divided by equity.
A measure that shows the loan-to-value ratio, which comprises the correlation between debt and equity. This makes it a measure of financial position and stability. A good level of net debt/equity ratio provides favourable conditions for growth opportunities, while the dividend policy can be upheld.

Operating capital
Equity plus net debt.
Operating capital shows how much capital there is in the operation. This measure is mainly used to calculate the return on operating capital.

Organic growth
Growth rate that does not come from acquisitions or currency effects, compared with the corresponding period in the preceding year.
Organic growth enables a comparison over time for the companies that have been a part of the Nederman group for more than 12 months, excluding effects of changed exchange rates. The measure is used to show the ability to generate growth in existing operations.

Earnings per share (before dilution)
Net profit for the year attributable to parent company shareholders in relation to the average number of shares outstanding.
Earnings per share shows how much of the period’s earnings that each share provides entitlement to.

Earnings per share (after dilution)
Net profit for the year attributable to parent company shareholders in relation to the average number of shares outstanding plus the average number of convertibles and warrants, as calculated in accordance with IAS 33.

Interest-coverage ratio
Profit before tax with a reversal of financial expenses and acquisition costs in relation to financial expenses.
The performance measure shows the capacity to cover the financial expenses. The performance measure states how many times the group’s earnings cover the financial expenses.

Operating profit
Operating profit after depreciation, amortisation and impairment.
Shows the earnings from operational activities.

Operating margin
Operating profit as a percentage of net sales.

Equity/assets ratio
Equity divided by total assets (balance sheet total).
This performance measure reflects the company’s financial position and thus its long-term payment capacity. A healthy equity/assets ratio, in other words, a strong financial position, provides the requirements to be able to manage weak economic periods and to capitalise on future growth opportunities.

Currency-neutral growth
Currency-neutral growth is the growth rate that does not come from currency effects, compared with the corresponding period in the preceding year.
Currency-neutral growth comprises organic growth plus growth from acquired subsidiaries, which are deemed to provide a fair view of the operations’ development. Currency-neutral growth is one of Nederman group’s long-term financial targets.

Annual average
Average of the balance at the beginning and end of the year.