Financial position at the end of June 2019

Caverion’s cash and cash equivalents amounted to EUR 103.6 (62.2) million at the end of June. In addition, Caverion has undrawn revolving credit facilities amounting to EUR 100.0 million and undrawn overdraft facilities amounting to EUR 19.0 million.

The Group’s gross interest-bearing loans and borrowings excluding lease liabilities amounted to EUR 128.3 (72.4) million at the end of June, and the average interest rate after hedges was 2.9 percent. Approximately 39 percent of the loans have been raised from banks and other financial institutions, approximately 58 percent from capital markets and approximately 3 percent from insurance companies. A total of EUR 3.3 million of the interest-bearing borrowings will fall due during the next 12 months. Lease liabilities amounted to EUR 134.3 million at the end of June 2019, resulting to total gross interest-bearing liabilities of EUR 262.6 million.

The Group’s net debt excluding lease liabilities amounted to EUR 24.7 (10.2) million at the end of June and including the lease liabilities EUR 158.9 million. At the end of June, the Group’s gearing was 77.3 (3.9) percent and the equity ratio 20.8 (28.2) percent. Excluding the effect of IFRS 16, the gearing would have amounted to 12.0 percent and the equity ratio to 24.0 percent.

At the end of the first quarter, Caverion issued new EUR 75 million senior unsecured fixed rate notes with maturity on 28 March 2023 as well as carried out a voluntary cash tender offer for its EUR 100 million hybrid notes issued on 16 June 2017. The 4-year notes carry a fixed annual interest rate of 3.25% per annum. The use of proceeds from the notes included, in addition to the partial redemption of the hybrid notes, general corporate purposes and investments and acquisitions in accordance with Caverion’s strategy. The final acceptance amount of the hybrid tender offer was EUR 33.94 million and the remaining amount of the hybrid bond outstanding is EUR 66.06 million. The purchase price of the hybrid notes was 101.20%. The rationale of the transactions was to proactively manage the Group’s debt portfolio, to extend the Group’s debt maturity profile and to decrease overall funding costs. Furthermore, Caverion also refinanced its bank loans and undrawn revolving credit facilities at the beginning of February 2019.

Caverion’s external loans are subject to a financial covenant based on the ratio of the Group’s net debt to EBITDA. The financial covenant shall not exceed 3.5:1. At the end of June, the Group’s Net debt to EBITDA was 0.8x according to the confirmed calculation principles. The confirmed calculation principles exclude the effects of the IFRS 16 standard and contain certain other adjustments such as excluding the German anti-trust fine and related legal and advisory fees.


Debt maturity

Net debt (EURm)

Gross debt to net debt

Cash flow and working capital

The Group’s operating cash flow before financial and tax items improved to EUR 59.2 (4.9) million in January-June. The Group’s free cash flow improved to EUR 52.1 (-5.1) million.

The Group’s working capital improved to EUR -80.8 (-57.2) million at the end of June. Excluding the impact of the German cartel fine accrual of EUR 40.8 million in Q2/18, the improvement was EUR 64.4 million. The amount of trade and POC receivables decreased to EUR 502.2 (529.5) million and other current receivables to EUR 25.2 (44.0) million. On the liabilities side, trade and POC payables decreased to EUR 194.5 (207.4) million and advances received increased to EUR 196.5 (170.8) million. Working capital continued to decrease on the Group level during the second quarter. Excluding the impact of the cartel fine accrual in the second quarter of 2018, working capital improved substantially in division Germany. There was also good improvement in divisions Finland and Industrial Solutions compared to the previous year.