DEBT AND FINANCING RATIOS
In the period under review, the debt of the Group posed no threat to its going concern and capacity to meet liabilities on time. The ratio of net debt to EBITDA remained negative, the same as in 2014, due to negative net debt (cash exceeds interest-bearing liabilities), combined with an increase of EBITDA. The debt to equity ratio decreased year on year in 2015 due to an increase in equity. The Group did not raise additional borrowed capital in 2015. However, it bought back part of its series A and B bonds at face value of PLN 124.5 million and issued new series C bonds at PLN 125 million.
LIQUIDITY RATIOS
The current liquidity ratio was 10.3 as at 31 December 2015; its increase was due to a decrease in current liabilities year on year in 2015.
The coverage ratio of interest costs under the bond issue increased in 2015 year on year due to the Group’s higher EBITDA and lower interest costs. Consequently, the Group generated cash flows from operating activities which were several times higher than necessary to cover current liabilities under the bond issue.
PROFITABILITY RATIOS
The profitability ratios improved year on year in 2015, driven by a higher sales revenue and lower operating expenses, as reflected in the improving return and cost/income ratios as well as ROE and ROA of the Group.
Key financial indicators of GPW Group
| As at / For the 12-month period ended | ||||
|---|---|---|---|---|
| 31 December 2015 | 31 December 2014 | 31 December 2013 | ||
| Debt and financing ratios | ||||
| Net debt / EBITDA for 12 months | 1). 2) | (0.6) | (0.9) | (0.6) |
| Debt to equity | 3) | 33.9% | 34.9% | 38.3% |
| Liquidity ratios | ||||
| Current liquidity | 4) | 10.3 | 7.0 | 7.7 |
| Coverage of interest on bonds | 5) | 23.5 | 17.3 | 12.9 |
| Return ratios | ||||
| EBITDA | 6) | 54.7% | 51.7% | 50.9% |
| Operating profit margin | 7) | 46.6% | 42.6% | 41.8% |
| Net profit margin | 8) | 37.7% | 35.4% | 40.0% |
| Cost / income | 9) | 53.2% | 57.2% | 58.6% |
| ROE | 10) | 17.4% | 16.8% | 19.0% |
| ROA | 11) | 12.1% | 11.5% | 12.8% |
1) Net debt = interest-bearing liabilities less liquid assets of GPW Group (as at balance-sheet date)
2) EBITDA = GPW Group operating profit + depreciation and amortisation (for a period of 12 months); net of the share of profit of associates
3) Debt to equity = interest-bearing liabilities / equity (as at balance-sheet date)
4) Current liquidity = current assets / current liabilities (as at balance-sheet date)
5) Coverage of interest on bonds = EBITDA / interest on bonds (interest paid and accrued for a period of 12 months)
6) EBITDA margin = EBITDA / GPW Group revenue (for a period of 12 months)
7) Operating profit margin = GPW Group operating profit / GPW Group revenue (for a period of 12 months)
8) Net profit margin = GPW Group net profit / GPW Group revenue (for a period of 12 months)
9) Cost / income = GPW Group operating expenses / GPW Group revenue (for a period of 12 months)
10) ROE = GPW Group net profit (for a period of 12 months) / Average equity at the beginning and at the end of the last 12 month period
11) ROA = GPW Group net profit (for a period of 12 months) / Average total assets at the beginning and at the end of the last 12 month period