Supplementary information
– Financial reporting – Consolidated financial statements – Supplementary information
Alternative performance measures (APM)
The financial information included in this report includes certain alternative performance measures (APMs), which are not accounting measures as defined by IFRS. These APMs should not be used instead of, or considered as alternatives to, the group’s consolidated financial results based on IFRS. These APMs may not be comparable to similarly titled measures disclosed by other companies. All APMs presented relate to the performance of the current reporting period and comparative periods.
Definition of alternative performance measures (APM)
Order intake from continuing operations
Order intake from continuing operations includes all registered orders from continuing operations of the period that will be recorded or have already been recorded as sales. The reported value of an order corresponds to the undiscounted value of sales that the group expects to recognize following delivery of goods or services subject to the order, less any trade discounts and excluding value added or sales tax. Adjustments, corrections and cancellations resulting from updating the order backlog are respectively included in the amount of the order intake.
Order intake gross margin from continuing operations
The order intake gross margin from continuing operations is defined as the expected gross profit of order intake from continuing operations divided by order intake from continuing operations.
Order backlog from continuing operations
Order backlog from continuing operations represents the undiscounted value of sales the group expects to generate from orders from continuing operations on hand at the end of the reporting period.
Return on sales (ROS) from continuing operations
ROS from continuing operations measures the profitability from continuing operations relative to sales. ROS from continuing operations is calculated by dividing EBIT from continuing operations by sales.
Operational profit from continuing operations
Operational profit from continuing operations is used to determine the profitability of the business, without considering impairments, restructuring expenses and other non-operational items and before interest, taxes and amortization. Other non-operational items include significant acquisition-related expenses, gains and losses from sale of businesses or real estate, and certain non-operational items that are non-recurring or do not occur in similar magnitude.
Operational profitability from continuing operations
Operational profitability from continuing operations measures how the group turns sales from continuing operations into operating profits. Operational profitability is calculated by dividing operational profit from continuing operations by sales from continuing operations.
Operational ROCEA (operational return on capital employed adjusted)
Operational ROCEA measures how the group generates operational profits from its capital employed. Operational ROCEA is calculated by dividing operational profit by average capital employed.
Capital employed
Capital employed refers to the amount of capital investment the group uses to operate and provides an indication of how the group is investing its money. For the calculation of the capital employed, please refer to the reconciliation statement below.
EBITDA (earnings before interest, taxes, depreciation and amortization)
The group uses EBITDA to determine the net debt/EBITDA ratio. EBITDA is defined as EBIT before depreciation and amortization.
Core net income from continuing operations
Core net income from continuing operations is used to determine the dividend proposal. Sulzer’s long-term target is to maintain a dividend payout ratio of approximately 40% to 70% of core net income from continuing operations with due consideration to liquidity and funding requirements as well as continuity. Core net income from continuing operations is defined as net income from continuing operations before tax-adjusted effects on restructuring, amortization, impairments and non-operational items.
Free cash flow (FCF)
FCF is used to assess the group’s ability to generate the cash required to conduct and maintain its operations. It also indicates the group’s ability to generate cash to finance dividend payments, repay debt and to undertake merger and acquisition activities. FCF is calculated based on the IFRS cash flow from operating activities and adjusted for capital expenditures (investments in property, plant and equipment and intangible assets).
Net debt
Net debt is used to monitor the group’s overall short- and long-term liquidity. Net debt is calculated as the sum of total current and non-current borrowings and lease liabilities less cash and cash equivalents and current financial assets.
Net debt/EBITDA ratio
Net debt/EBITDA is a ratio measuring the amount of income generated and available to pay down debt before covering interest, taxes, depreciations and amortization expenses. The net debt/EBITDA ratio is used as a measurement of leverage. It is calculated as net debt divided by EBITDA.
Gearing ratio (borrowings-to-equity ratio)
The gearing ratio compares the borrowings and lease liabilities relative to the equity. The gearing ratio represents the group’s leverage, comparing how much of the business’s funding comes from borrowed funds (lenders) versus company owners (shareholders). The gearing ratio is defined as borrowings and lease liabilities divided by equity attributable to shareholders of Sulzer Ltd.
Currency-adjusted growth
Certain percentage changes in the financial review and the business review divisions have been calculated using constant exchange rates, which allow for an assessment of the group’s financial performance with the effects of exchange rate fluctuations eliminated. The currency-adjusted growth is calculated by applying the previous year’s exchange rates for the current year and calculating the growth without currency effects.
Organic growth
Organic growth measures changes with the same period in the previous year after adjusting for effects arising from acquisitions, divestments and foreign exchange differences.
The impact of the organic growth is determined as follows:
- Currency-adjusted growth as described above
- For the current-year acquisitions, by deducting the currency-adjusted amount generated during the current-year by the acquired entities
- For prior-year acquisitions, by deducting the currency-adjusted amount generated over the months during which the acquired entities were not consolidated in the previous year
- For current-year disposals, by adding the currency-adjusted amount generated by the divested entities in the previous year over the months during which those entities were no longer consolidated in the current year
- For the prior-year disposals, by adding for the current year the currency-adjusted amount generated in the previous year by the divested entities
Reconciliation statements for alternative performance measures (APM)
For reconciliation statements of operational profit, operational profitability, core net income and free cash flow, please refer to the section “Financial review”, for EBITDA, net debt and gearing ratio to note 6 and for operational ROCEA to the table below.
Operational ROCEA reconciliation statement
|
millions of CHF |
|
2021 |
|
2020 1) |
|
Total assets |
|
5’010.4 |
|
5’367.0 |
|
./. Other intangible assets |
|
–276.5 |
|
–401.0 |
|
./. Cash and cash equivalents |
|
–1’505.4 |
|
–1’123.2 |
|
./. Current financial assets |
|
–26.7 |
|
–305.1 |
|
./. Total current and non-current income and deferred tax assets and liabilities |
|
–64.3 |
|
–56.0 |
|
./. Total non-current liabilities |
|
–1’568.8 |
|
–1’976.0 |
|
./. Total current liabilities |
|
–2’162.3 |
|
–1’973.8 |
|
Non-current borrowings |
|
1’164.6 |
|
1’491.3 |
|
Current borrowings |
|
345.5 |
|
231.8 |
|
Liability related to the purchase of treasury shares |
|
98.1 |
|
103.4 |
|
Outstanding dividend payments |
|
201.1 |
|
157.6 |
|
Adjustment for average calculation and currency translation differences |
|
74.4 |
|
–321.3 |
|
Average capital employed from continuing operations |
|
1’290.1 |
|
1’194.6 |
|
|
|
|
|
|
|
Operational profit from continuing operations |
|
293.3 |
|
255.0 |
|
Average capital employed |
|
1’290.1 |
|
1’194.6 |
|
Operational ROCEA |
|
22.7% |
|
21.3% |
1) Comparative information has been re-presented due to discontinued operations (details are described in note 7 to the consolidated financial statements).
– Financial reporting – Consolidated financial statements – Five-year summaries
Five-year summaries of key financial data
Key figures from consolidated income statement and statement of cash flows
|
millions of CHF |
|
2021 |
|
2020 1) |
|
2019 1) |
|
2018 1) |
|
2017 1) |
|
Order intake from continuing operations |
|
3’167.6 |
|
3’049.2 |
|
3’322.1 |
|
3’081.9 |
|
2’729.4 |
|
Currency-adjusted growth order intake from continuing operations |
|
3.6% |
|
–1.1% |
|
n/a |
|
n/a |
|
n/a |
|
Order intake gross margin from continuing operations |
|
33.1% |
|
32.6% |
|
32.0% |
|
31.4% |
|
32.9% |
|
Order backlog from continuing operations |
|
1’724.1 |
|
1’676.8 |
|
1’731.8 |
|
1’721.9 |
|
1’526.7 |
|
Sales from continuing operations |
|
3’155.3 |
|
2’967.8 |
|
3’307.9 |
|
2’911.0 |
|
2’627.5 |
|
Operating income (EBIT) from continuing operations |
|
221.8 |
|
132.5 |
|
202.8 |
|
120.9 |
|
73.3 |
|
Operational profit from continuing operations |
|
293.3 |
|
255.0 |
|
283.1 |
|
226.8 |
|
168.6 |
|
Operational profitability from continuing operations |
|
9.3% |
|
8.6% |
|
8.6% |
|
7.8% |
|
6.4% |
|
Net income attributable to shareholders of Sulzer Ltd |
|
1’416.7 |
|
83.6 |
|
154.0 |
|
113.7 |
|
83.2 |
|
– in percentage of equity attributable to shareholders of Sulzer Ltd (ROE) |
|
111.2% |
|
6.0% |
|
9.7% |
|
7.0% |
|
5.0% |
|
Basic earnings per share (in CHF) |
|
41.93 |
|
2.46 |
|
4.52 |
|
3.56 |
|
2.44 |
|
Depreciation from continuing operations |
|
–81.0 |
|
–78.3 |
|
–79.7 |
|
–52.2 |
|
–50.9 |
|
Amortization from continuing operations |
|
–50.2 |
|
–46.7 |
|
–45.5 |
|
–49.4 |
|
–36.8 |
|
Impairments of tangible and intangible assets from continuing operations |
|
–4.2 |
|
–9.4 |
|
–3.1 |
|
–0.7 |
|
–15.4 |
|
Research and development expenses from continuing operations |
|
–64.4 |
|
–63.8 |
|
–62.7 |
|
–63.9 |
|
–57.2 |
|
Personnel expenses from continuing operations |
|
–1’018.1 |
|
–1’014.4 |
|
–1’078.7 |
|
–1’241.9 |
|
n/a |
|
Capital expenditure (incl. lease assets) from continuing operations |
|
–119.4 |
|
–88.0 |
|
–100.8 |
|
–64.7 |
|
–52.3 |
|
Free cash flow (FCF) from continuing operations |
|
210.5 |
|
262.6 |
|
156.8 |
|
115.5 |
|
n/a |
|
FCF conversion (free cash flow/net income) from continuing operations |
|
1.50 |
|
3.67 |
|
1.18 |
|
1.80 |
|
n/a |
|
Employees (number of full-time equivalents) from continuing operations as of December 31 |
|
13’816 |
|
13’197 |
|
14’685 |
|
13’708 |
|
13’016 |
1) Comparative information has been re-presented due to discontinued operations (details are described in note 7).
Key figures from consolidated balance sheet
|
millions of CHF |
|
2021 |
|
2020 1) |
|
2019 |
|
2018 |
|
2017 |
|
Non-current assets |
|
1’834.2 |
|
2’279.9 |
|
2’172.0 |
|
2’057.7 |
|
1’990.5 |
|
– thereof property, plant and equipment |
|
394.0 |
|
545.3 |
|
544.4 |
|
527.0 |
|
531.6 |
|
Current assets |
|
3’176.2 |
|
3’087.1 |
|
2’937.5 |
|
2’840.6 |
|
2’126.8 |
|
– thereof cash and cash equivalents |
|
1’505.4 |
|
1’123.2 |
|
1’035.5 |
|
1’095.2 |
|
488.8 |
|
Total assets |
|
5’010.4 |
|
5’367.0 |
|
5’109.5 |
|
4’898.3 |
|
4’117.3 |
|
Equity attributable to shareholders of Sulzer Ltd |
|
1’273.8 |
|
1’404.3 |
|
1’580.7 |
|
1’629.9 |
|
1’680.1 |
|
Non-current liabilities |
|
1’568.8 |
|
1’976.0 |
|
1’644.1 |
|
1’646.8 |
|
900.1 |
|
– thereof non-current borrowings |
|
1’164.6 |
|
1’491.3 |
|
1’199.2 |
|
1’316.3 |
|
458.7 |
|
– thereof non-current lease liabilities |
|
64.5 |
|
90.2 |
|
82.3 |
|
– |
|
– |
|
Current liabilities |
|
2’162.3 |
|
1’973.8 |
|
1’871.5 |
|
1’610.4 |
|
1’514.8 |
|
– thereof current borrowings |
|
345.5 |
|
231.8 |
|
131.0 |
|
18.0 |
|
255.1 |
|
– thereof current lease liabilities |
|
24.3 |
|
29.5 |
|
27.4 |
|
– |
|
– |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net debt |
|
66.8 |
|
414.5 |
|
346.9 |
|
239.0 |
|
225.0 |
|
Net debt/EBITDA ratio |
|
0.15 |
|
1.26 |
|
0.84 |
|
0.73 |
|
0.81 |
|
Equity ratio 2) |
|
25.4% |
|
26.1% |
|
30.9% |
|
33.3% |
|
40.8% |
1) Comparative information has been re-presented due to discontinued operations (details are described in note 7). The balance sheet as of December 31, 2020, has been adjusted following the finalization of the purchase price accounting and measurement period adjustments related to acquisitions in 2020. A reconciliation to the previously published balance sheet is provided in note 4. Defined benefit assets are presented as non-current assets and comparative information is re-presented. Further details are available in note 9.
2) Equity attributable to shareholders of Sulzer Ltd in relation to total assets.
Five-year summaries by division
|
|
|
Order intake from continuing operations |
|
Sales from continuing operations |
||||||||||||||||
|
millions of CHF |
|
2021 |
|
2020 1) |
|
2019 1) |
|
2018 1) |
|
2017 1) |
|
2021 |
|
2020 1) |
|
2019 1) |
|
2018 1) |
|
2017 1) |
|
Flow Equipment |
|
1’324.7 |
|
1’297.6 |
|
1’458.9 |
|
1’372.1 |
|
1’180.2 |
|
1’389.0 |
|
1’296.3 |
|
1’477.0 |
|
1’284.2 |
|
1’120.0 |
|
Services |
|
1’163.4 |
|
1’130.8 |
|
1’193.2 |
|
1’109.7 |
|
1’047.7 |
|
1’117.7 |
|
1’078.3 |
|
1’167.0 |
|
1’063.7 |
|
1’029.5 |
|
Chemtech |
|
679.5 |
|
620.8 |
|
670.0 |
|
600.1 |
|
501.5 |
|
648.5 |
|
593.1 |
|
664.0 |
|
563.2 |
|
478.0 |
|
Total |
|
3’167.6 |
|
3’049.2 |
|
3’322.1 |
|
3’081.9 |
|
2’729.4 |
|
3’155.3 |
|
2’967.8 |
|
3’307.9 |
|
2’911.0 |
|
2’627.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
|
|
Order backlog from continuing operations |
|
Employees from continuing operations 2) |
||||||||||||||||
|
millions of CHF |
|
2021 |
|
2020 1) |
|
2019 1) |
|
2018 1) |
|
2017 1) |
|
2021 |
|
2020 1) |
|
2019 1) |
|
2018 1) |
|
2017 1) |
|
Flow Equipment |
|
811.5 |
|
845.0 |
|
924.3 |
|
982.9 |
|
847.0 |
|
5’325 |
|
5’362 |
|
5’759 |
|
5’713 |
|
5’453 |
|
Services |
|
479.5 |
|
435.0 |
|
422.2 |
|
393.1 |
|
364.4 |
|
4’571 |
|
4’449 |
|
4’900 |
|
4’721 |
|
4’485 |
|
Chemtech |
|
433.2 |
|
396.9 |
|
385.3 |
|
345.9 |
|
315.3 |
|
3’734 |
|
3’221 |
|
3’803 |
|
3’063 |
|
2’878 |
|
Divisions |
|
1’724.1 |
|
1’676.8 |
|
1’731.8 |
|
1’721.9 |
|
1’526.7 |
|
13’631 |
|
13’032 |
|
14’463 |
|
13’497 |
|
12’816 |
|
Others |
|
|
|
0.0 |
|
0.0 |
|
–0.0 |
|
– |
|
185 |
|
165 |
|
222 |
|
211 |
|
200 |
|
Total |
|
1’724.1 |
|
1’676.8 |
|
1’731.8 |
|
1’721.9 |
|
1’526.7 |
|
13’816 |
|
13’197 |
|
14’685 |
|
13’708 |
|
13’016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operational profit from continuing operations |
|
Operational profitability from continuing operations |
||||||||||||||||
|
millions of CHF |
|
2021 |
|
2020 1) |
|
2019 1) |
|
2018 1) |
|
2017 1) |
|
2021 |
|
2020 1) |
|
2019 1) |
|
2018 1) |
|
2017 1) |
|
Flow Equipment |
|
81.4 |
|
55.2 |
|
59.7 |
|
41.4 |
|
–3.7 |
|
5.9% |
|
4.3% |
|
4.0% |
|
3.2% |
|
–0.3% |
|
Services |
|
158.7 |
|
150.3 |
|
164.5 |
|
146.1 |
|
144.0 |
|
14.2% |
|
13.9% |
|
14.1% |
|
13.7% |
|
13.9% |
|
Chemtech |
|
64.8 |
|
56.9 |
|
63.8 |
|
50.0 |
|
25.0 |
|
10.0% |
|
9.6% |
|
9.6% |
|
8.9% |
|
5.2% |
|
Divisions |
|
304.9 |
|
262.4 |
|
288.0 |
|
237.5 |
|
165.3 |
|
9.7% |
|
8.8% |
|
8.7% |
|
8.2% |
|
6.3% |
|
Others |
|
–11.6 |
|
–7.4 |
|
–4.9 |
|
–10.7 |
|
3.3 |
|
n/a |
|
n/a |
|
n/a |
|
n/a |
|
n/a |
|
Total |
|
293.3 |
|
255.0 |
|
283.0 |
|
226.8 |
|
168.6 |
|
9.3% |
|
8.6% |
|
8.6% |
|
7.8% |
|
6.4% |
1) Comparative information has been re-presented due to discontinued operations (details are described in note 7).
2) Number of full-time equivalents as of December 31.
Five-year summaries by region
Order intake from continuing operations by region
|
millions of CHF |
|
2021 |
|
2020 1) |
|
2019 1) |
|
2018 1) |
|
2017 1) |
|
Europe, the Middle East and Africa |
|
1’281.2 |
|
1’211.6 |
|
1’375.8 |
|
1’275.9 |
|
1’176.8 |
|
Americas |
|
1’051.8 |
|
1’009.5 |
|
1’134.6 |
|
1’144.8 |
|
902.3 |
|
Asia-Pacific |
|
834.6 |
|
828.2 |
|
811.7 |
|
661.2 |
|
650.2 |
|
Total |
|
3’167.6 |
|
3’049.2 |
|
3’322.1 |
|
3’081.9 |
|
2’729.4 |
1) Comparative information has been re-presented due to discontinued operations (details are described in note 7).
Sales from continuing operations by region
|
millions of CHF |
|
2021 |
|
2020 1) |
|
2019 1) |
|
2018 1) |
|
2017 1) |
|
Europe, the Middle East and Africa |
|
1’297.5 |
|
1’198.1 |
|
1’306.9 |
|
1’203.5 |
|
1’172.8 |
|
Americas |
|
978.1 |
|
1’027.1 |
|
1’165.3 |
|
964.4 |
|
865.9 |
|
Asia-Pacific |
|
879.7 |
|
742.6 |
|
835.8 |
|
743.1 |
|
588.7 |
|
Total |
|
3’155.3 |
|
2’967.8 |
|
3’307.9 |
|
2’911.0 |
|
2’627.5 |
1) Comparative information has been re-presented due to discontinued operations (details are described in note 7).
Employees from continuing operations by company location1)
|
millions of CHF |
|
2021 |
|
2020 |
|
2019 |
|
2018 |
|
2017 |
|
Europe, the Middle East and Africa |
|
5’795 |
|
5’709 |
|
6’246 |
|
5’943 |
|
5’899 |
|
Americas |
|
4’207 |
|
3’960 |
|
4’429 |
|
4’211 |
|
3’748 |
|
Asia-Pacific |
|
3’815 |
|
3’528 |
|
4’010 |
|
3’555 |
|
3’369 |
|
Total |
|
13’816 |
|
13’197 |
|
14’685 |
|
13’708 |
|
13’016 |
1) Number of full-time equivalents as of December 31.