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, irrespective of the current non-investment grade rating. We manage our capital structure on the basis of the following key figures:
Key figures for managing the capital structure
|Value 2021*||Value 2020||Value 2019||Value 2018||Value 2017|
|Net financial debt / EBITDA||0.6||7.2||4.9||5.3||5.2|
|Net debt / equity (in %)||34.1||209.5||101.6||107.2||99.5|
|Net debt ratio (in %)||60.6||26.5||42.4||41.6||42.7|
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.
Current rating classification
|Rating agency||Rating||Outlook||Date of the last update|
|Standard & Poor's||BB+||positive||
November 25, 2022
K+S Aktiengesellschaft issued corporate bonds on the capital market on 11 July 2018 and 31 March 2017. These enable longer-term financing at attractive conditions and offer lenders an interesting investment opportunity.
Bond buy-back successfully completed
K+S has completed the buy-back of the outstanding bonds maturing in 2024 (ISIN: XS1854830889) as planned. The Company is therefore reducing its financial liabilities by a further €116.4 million.
Meanwhile, on November 25, the Standard & Poor's (S&P) rating agency upgraded the long-term rating of K+S to BB+ (previously: BB). This is just one notch below investment grade. The rating outlook was also raised from stable to positive.
|March 2017 bond||July 2018 bond|
|Listing:||Stock exchange Luxembourg||Stock exchange Luxembourg|
|Issue volume:||625 million EUR||600 million EUR|
|Outstanding volume:||396.385 million EUR||283.700 million EUR|
|Denomination:||1,000 EUR||100,000 EUR|
|Maturity:||April 6, 2023||July 18, 2024|