Financial targets
Description: Good sales development and a strong market position are key factors in achieving and maintaining good profitability and value growth.
Outcome: In 2019 the Swedish ICA stores’ growth was in line with market growth in Sweden according to the Food Retail Index. Apotek Hjärtat’s sales in 2019 were somewhat lower than market growth. Rimi Baltic’s sales – affected by store conversions, among other things – increased but at a slower pace than the market.
Description: The target level provides room for investments in the business and a return on invested capital, and is at a good level for the industry. The target is measured excluding items affecting comparability.
Outcome: The operating margin was higher in 2019 than in the previous year. Positive price and product mix effects, along with good volume growth in several operations, were partly offset by higher costs for a number of large improvement and development projects conducted on a broad front within the Group. ICA Sweden’s structural costs in 2018 affected the operating margin for 2018 by –0.1%.
1 In addition to the formal IFRS reports, in Recalculated 2018 amounts are presented as if IFRS 16 had been applied from 1 January 2018, see Note 1. These amounts have not been reviewed by the auditors.
Description: The target level indicates that the Group is using capital effectively. The target was changed at the beginning of 2019 due to accounting changes under IFRS 16.
ICA Bank is not included in the calculation because banking legislation stipulates that its assets and liabilities are not available to the Group. Instead ICA Bank has a target for return on equity that is a more appropriate target for banking operations.
Outcome: The return on capital employed increased to 7.9%. The improvement in earnings during the year explains why the return increased even though average capital employed rose by around SEK 1 billion during the year.
1 In addition to the formal IFRS reports, in Recalculated 2018 amounts are presented as if IFRS 16 had been applied from 1 January 2018, see Note 1. These amounts have not been reviewed by the auditors.
Description: The intention is to provide shareholders with a good dividend while also being able to make value-adding operational investments.
Outcome: The Board of Directors proposes a dividend of SEK 12.00. This is an increase of SEK 0.50 or 4.3%, making the dividend percentage 70% for 2019 assuming that the Annual General Meeting approves the Board’s proposal.
1 In addition to the formal IFRS reports, in Recalculated 2018 amounts are presented as if IFRS 16 had been applied from 1 January 2018, see Note 1. These amounts have not been reviewed by the auditors.
Description: A good balance between earnings and borrowing gives the company the freedom and ability to act, even in times of recession. The target was changed at the beginning of 2019 due to accounting changes under IFRS 16.
Outcome: The key ratio was somewhat lower than last year due to continued strong cash flows from operating activities and thus a lower debt ratio. Simultaneously, EBITDA was also somewhat higher.
1 In addition to the formal IFRS reports, in Recalculated 2018 amounts are presented as if IFRS 16 had been applied from 1 January 2018, see Note 1. These amounts have not been reviewed by the auditors.
