The Electrolux Group presents certain measures that are not defined under IFRS (alternative performance measures –” APMs”). These are used by management to assess the financial and operational performance of the Group. Management believes that these APMs provide useful information regarding the Group’s financial and operating performance. Such measures may not be comparable to similar measures presented by other companies. Consequently, APMs have limitations as analytical tools and should not be considered in isolation or as a substitute for related financial measures prepared in accordance with IFRS. The APMs have been derived from the Group’s internal reporting and are not audited.
Computation of average amounts and annualized income statement measures
In computation of key ratios where averages of capital balances are related to income statement measures, the average capital balances are based on the opening balance and all quarter-end closing balances included in the reporting period, and the income statement measures are annualized, translated at average rates for the period. In computation of key ratios where end-of-period capital balances are related to income statement measures, the latter are annualized, translated at end of-period exchange rates. Adjustments are made for acquired and divested operations.
Definitions and reconciliations of alternative performance measures
Growth measures
Change in net sales
Current year net sales for the period less previous year net sales for the period as a percentage of previous year net sales for the period.
Sales growth
Change in net sales adjusted for currency translation effects.
Organic sales growth
Change in net sales, adjusted for currency translation effects, acquisitions and divestments.
Acquisitions
Change in net sales, adjusted for organic sales growth, currency translation effects and divestments. The impact from acquisitions relates to net sales reported by acquired operations within 12 months after the acquisition date.
Divestments
Change in net sales, adjusted for organic sales growth, currency translation effects and acquisitions. The impact from divestments relates to net sales reported by the divested operations within 12 months before the divestment date.
Profitability measures
EBITA
Operating income excluding amortization of intangible assets.
EBITA margin
EBITA expressed as a percentage of net sales.
EBITDA
Operating income excluding depreciation and amortization.
Operating income excluding non-recurring items
Operating income adjusted for non-recurring items.
Operating margin (EBIT margin)
Operating income (EBIT) expressed as a percentage of net sales.
Operating margin (EBIT margin) excluding non-recurring items
Operating income (EBIT) excluding non-recurring items, expressed as a percentage of net sales.
Return on net assets
Operating income (annualized) expressed as a percentage of average net assets.
Return on equity
Income for the period (annualized) expressed as a percentage of average total equity.
Capital measures
Net debt/equity ratio
Net debt in relation to total equity.
Net debt/EBITDA
Net debt at end of period in relation to 12-months rolling EBITDA, excluding non-recurring items.
Equity/assets ratio
Total equity as a percentage of total assets less liquid funds.
Capital turnover-rate
Net sales (annualized) divided by average net assets.
Share-based measures
Earnings per share, Basic
Income for the period attributable to equity holders of the Parent Company divided by the average number of shares excluding shares held by AB Electrolux.
Earnings per share, Diluted
Income for the period attributable to equity holders of the Parent Company divided by the average number of shares after dilution, excluding shares held by AB Electrolux.
Equity per share
Total equity divided by total number of shares excluding shares held by AB Electrolux.
Capital indicators
Liquid funds
Cash and cash equivalents, short-term investments, financial derivative assets and prepaid interest expenses and accrued interest income.
Operating working capital
Inventories and trade receivables less accounts payable.
Working capital
Total current assets exclusive of liquid funds, less non-current other provisions and total current liabilities exclusive of total short-term borrowings.
Net assets
Total assets exclusive of liquid funds and pension plan assets, less non-current assets and related liabilities held for sale, deferred tax liabilities, non-current other provisions and total current liabilities exclusive of total short-term borrowings.
Total borrowings
Long-term borrowings and short-term borrowings, financial derivative liabilities, accrued interest expenses and prepaid interest income.
Total short-term borrowings
Short-term borrowings, financial derivative liabilities1, accrued interest expenses and prepaid interest income.
Interest-bearing liabilities
Long-term borrowings and short-term borrowings exclusive of liabilities related to trade receivables with recourse.
Financial net debt
Total borrowings less liquid funds.
Net provision for post-employment benefits
Provisions for post-employment benefits less pension plan assets.
Net debt
Financial net debt, lease liabilities and net provision for post-employment benefits.
Other measures
Annualized Net Sales
(Net Sales for the period year-to-date/Number of months) x 12.
Operating cash flow
Operating income adjusted for depreciation, amortization and other non-cash items plus/minus change in operating assets and liabilities.
Operating cash flow after investments
Cash flow from operations and investments adjusted for financial items paid, taxes paid and acquisitions/divestments of operations.
Operating cash flow after structural changes
Operating cash flow adjusted for structural changes.
Cash flow excluding change in loans and short-term investments for the period
Cash flow adjusted for change in loans and short-term investments for the period.
Non-recurring items
Material profit or loss items in operating income which are relevant for understanding the financial performance when comparing income for the current period with previous periods.