Securing liquidity, minimizing risks

The financial management of the K+S Group follows three overriding objectives:

• secure liquidity and manage it efficiently throughout the company,
• to maintain and optimize the ability to finance,
• to reduce financial risks also by using financial instruments.

Through centralized cash management, we control liquidity and optimize cash flows within the company. In order to maintain our financing capability and to achieve favorable costs for debt and equity, we aim to achieve a long-term capital structure based on the criteria and ratios for an investment grade rating. We manage our capital structure on the basis of the following key figures:

¹ For the year 2020, the figures relate to the continuing and discontinued operations of the K+S Group; from 2021, the figures relate to the continuing operations of the K+S Group.
² There are no net financial liabilities as of December 31, 2022.
³ Net debt also includes non-current provisions for mining obligations due in more than 10 years in the amount of €966,5 million. Excluding these obligations from net debt, the key indicator amounts to 7.2%.

Currency and interest rate management is carried out centrally for all major Group companies. Derivative financial instruments are only concluded with banks of good credit standing, spread across several banks to reduce the default risk and monitored regularly.

Rating agencies assess the creditworthiness of companies - their so-called credit rating. A rating describes the assessment of a company's ability to meet its future interest and repayment obligations on time. The higher the rating, the lower the estimated potential risk. A company with a good rating can therefore generally borrow capital on the capital market at better terms than a company with a weak rating.

You will find more information on the rating definitions at Standard & Poor's.

* or earlier due to 3-months par call