Capital structure and dividend policy for SCA’s hygiene business
- Press release
SCA has decided on capital structure and dividend policy targets for the Group’s hygiene business.
The capital structure target for SCA’s hygiene business is to have an effective capital structure at the same time that the long-term access to debt financing is ensured. Cash flow in relation to net debt shall take into account the target to maintain a solid investment grade rating.
Dividend policy: SCA’s hygiene business aims to provide long-term stable and rising dividends to its shareholders. When cash flow from current operations exceeds what the company can invest in profitable expansion over the long term, and under the condition that the capital structure target is met, the surplus shall be distributed to the shareholders.
As per September 30, 2016, SCA’s net debt, including pension liabilities, amounted to SEK 40,281m, allocated pro forma as follows: SEK 35,281m attributed to the hygiene business and SEK 5,000m to the forest products business. The complete pro forma balance sheet and income statement for the hygiene business are included in this press release.
SCA's current lenders will be given the possibility to switch counterparty to SCA Hygiene AB, the Parent Company of SCA’s hygiene business or its subsidiaries. Due to this SCA informs that the company is currently participating in a process relating to a potential corporate acquisition. The process is still in an early phase but no decisions have been made. However, any potential acquisition by SCA will be made without prejudice of the capital structure targets. SCA will not provide any further information concerning this process.
| Pro forma Condensed Consolidated Balance Sheet September 30, 2016 |
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SEKm |
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| Non-current assets | |||
| Intangible assets | 26,447 | ||
| Buildings, land, machinery and equipment | 45,755 | ||
| Shares and participations | 1,067 | ||
| Financial and other non-current assets | 2,690 | ||
| Total non-current assets | 75,959 | ||
Current assets |
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| Inventories | 11,318 | ||
| Trade receivables and other current assets | 19,039 | ||
| Current financial assets, cash and cash equivalents | 5,820 | ||
| Total current assets | 36,177 | ||
| Total assets | 112,136 | ||
Equity |
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| Owners of the parent | 33,408 | ||
| Non-controlling interest | 6,172 | ||
| Total equity | 39,580 | ||
Non-current liabilities |
|||
| Non-current financial liabilities | 31,280 | ||
| Provisions for pensions | 8,450 | ||
| Other non-current liabilities | 4,433 | ||
| Total non-current liabilities | 44,163 | ||
Current liabilities |
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| Current financial liabilities | 2,219 | ||
| Other current liabilities | 26,174 | ||
| Total current liabilities | 28,393 | ||
| Total liabilities | 72,556 | ||
| Total equity and liabilities | 112,136 | ||
Pro forma Condensed Consolidated Income Statement January 1, 2016 - September 30, 2016 |
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SEKm |
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| Net sales | 74,465 | ||
| Cost of goods sold | -53,335 | ||
| Items affecting comparability | -484 | ||
| Gross profit | 20,646 | ||
| Sales, general and administration | -12,550 | ||
| Items affecting comparability | -1,654 | ||
| Share of profits of associates and joint ventures | 108 | ||
| Operating profit | 6,550 | ||
| Financial items | -570 | ||
| Profit before tax | 5,980 | ||
| Tax | -2,910 | ||
| Net profit for the period | 3,070 | ||
For additional information please contact:
Linda Nyberg, Vice President Media Relations, +46 (0)8 - 788 51 58
Johan Karlsson, Vice President Investor Relations, +46 (0)8 - 788 51 30