Financial targets

Dividend pay-out ratio of 50% of reported earnings per share

Reported group total earnings per share are used.

EBIT growth CAGR1 ≥7% 2016–2018

EBIT improvement excluding impact from changed exchange rates, items affecting comparability2 for the Group and metal price effect due to revaluation of inventories in Sandvik Materials Technology. Metric is calculated for continuing operations excluding Other Operations.

NET Gearing, NET DEBT/Equity <0.8

Net debt is calculated on group total and comprises interest-bearing current and non-current debts less cash and cash equivalents divided by shareholders' equity including non-controlling interests. Excludes major acquisitions.

ROCE improvment2 ≥3% PTS, 2016–2018

ROCE improvement calculated with annual ROCE 2015 as base.

  • Operating profit/loss excludes items affecting comparability2.
  • Capital employed excludes remaining provisions related to items affecting comparability2, however in the event of major impairments, the base – annual capital employed 2015 – is restated to align with the current level of capital employed.

Metric is calculated for continuing operations excluding Other Operations.

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1) Compound Annual Growth Rate.
2) Items affecting comparability: major acquisitions and disposals, restructuring costs and impairments.