Financial targets
The aims of Nobia’s financial targets are to generate favourable financial returns for shareholders and long-term healthy value growth. The company has been steered towards three financial targets for a number of years.
1. Growth in earnings
Earnings per share shall increase on average by 12 per cent per year over a business cycle.
Nobia will achieve this by:
- attaining organic growth that is 2–3 per cent higher than market growth
- growing through acquisitions
- achieving an operating margin (EBIT) that amounts to at least 10 per cent at Group level over a business cycle.
2. Financial strength
The debt/equity ratio shall not exceed 100 per cent. A temporary elevation of the debt/equity ratio is acceptable in conjunction with acquisitions. A long-term, significantly lower debt/equity ratio shall be adjusted by an extra dividend to shareholders or the buy-back of own shares.
3. Dividends
Dividends to shareholders shall on average comprise at least 30 per cent of net profit after tax. However, decisions regarding the amount of the dividend will be made in relation to the company’s capital structure at the time.
Special focus
An historic, deep recession began at the end of 2008. As a result, Nobia was forced to make some short-term adjustments to the financial targets. A major focus was shifted to cash flow, resulting in a favourable cash flow in both 2009 and 2010. The focus on maintaining profit margins was increased, partly by strengthening the cost focus. Overall, these measures entailed that Nobia now stands firmly equipped for leveraging the new business opportunities that a strong economy offers. As the situation normalises, the focus is returning to the financial targets described above.
Latest update: 16 May 2012