Financial targets

To support BillerudKorsnäs’ target for profitable growth and a good return for shareholders, the company has established five financial targets, as well as a number of sustainability targets within its respective commitments.

Long-term target for growth of 3–4% per year. The full year 2018 saw strong growth and the target was achieved due to higher selling prices and a positive currency impact.

Yeat Percent
2016: 0% 0
2017: 3% 3
2018: 6% 6
3
Target 3-4%
6
Outcome 6%

The EBITDA margin should exceed 17%. The target was not achieved for the full year 2018 mainly due to higher raw material costs. If adjusted EBITDA is used the margin would be 15%.

Year Percent
2016: 17% 17
2017: 17% 17
2018: 12% 12
17
Target >17%
12
Outcome 12%

Return on capital employed (ROCE) should exceed 13%. The target was not achieved for the full year 2018 due to higher raw material costs and large investments, mainly related to the new board machine KM7.

Year Percent
2016: 12% 12
2017: 12% 12
2018: 7% 7
13
Target >13%
7
Outcome 7%

Long-term interest-bearing net debt in relation to EBITDA should be less than a multiple of 2.5. At the end of 2018 this multiple was 3.17, if adjusted EBITDA is used the number would be 2.68 (note 6).The multiple has increased mainly due to increased debt related to investments in the new board machine in Gruvön.

Yeae Interest-bearing net debt/EBITDA
2016: 1,1 1.1
2017: 1,5 1.5
2018: 3,2 3.2
2.5
Target < 2.5
3.2
Outcome 3.2

The dividend should amount to 50% of net profit. The Board’s proposed dividend of SEK 4.30 per share for 2018 entails fulfilment of the dividend target through paying out 86% of net income as dividend, and 56% using adjusted net profit.

Year Percent
2016: 59% 59
2017: 54% 54
2018: 86% 86
50
Target 50%
86
Outcome 86%